Establishment of a branch office places the foreign business on the local state’s tax lists and permits the business to use the legal processes. The Korean parent corporation could establish a branch office in a state with a method to register with the state in order to do interstate or foreign business in the state by certifying the name and address of the resident agent in the state.

A branch office has an advantage to commencing business because it does not need to have a presence of any legal formalities other than qualifying to do business. However, the assets of the Korean Parent Corporation or business owner may be exposed to any liability created by the activities of the branch office.

A Korean business can choose to operate U.S. business through a U.S. subsidiary corporation organized under the law of a state in the U.S. One advantage of establishing a U.S. subsidiary is that the assets of the Korean Parent Corporation is generally protected because only the assets of the U.S. subsidiary are placed at risk by the activities of the U.S. subsidiary. Second, in most instances, a corporation’s officers, directors and shareholders are not liable for the corporation’s debts. Third, for the tax purpose, the establishment of a separate U.S. subsidiary may help clarify what income will be subject to the U.S. and Korean taxation.

If a Korean business wants to enter into a business relationship with a U.S. business to share resources in a common enterprise such as producing goods or supplying services, a joint venture could be a good option. A joint venture can be structured in one of two ways: either the two businesses each contribute capital to a newly formed corporation or the Korean and U.S. businesses enter into a general partnership agreement and operate a joint venture as a partnership.

There are various corporate law and taxation issues relating to the preferred form of organization in particular cases. The choice of business entity is a balance between consideration of expense, protection from personal liability, convenience, where the funding for the project is coming from and often most important, taxation. Law Firm Hanjoong International Business Team has built a plenty of experiences regarding an individval's and corporation's expansion to U.S. business market and is ready to provide a legal advice for Korean corporation and investors in order to satisfy their needs.