Director Change in South Korea: Rules & Deadlines

Changing a director in a South Korean company sounds simple, until the paperwork, deadlines, and shareholder rules start piling up. This article walks legal, tax, and compliance professionals through a director change in South Korea, from board procedures to filing obligations. Whether you manage a single entity or a sprawling multinational group, you will find practical guidance grounded in the Korean Commercial Act. Consider this your friendly map through the process, without the usual headaches.

What should you check before you start?

A smooth transition begins with a few basic questions. First, confirm who currently holds representative authority. That person can bind the company in all matters, and any internal limit on this power will not protect you against third parties acting in good faith. Next, look at your Articles of Incorporation. They tell you whether shareholders appoint directors, or whether the board may appoint the representative director instead. Also mind the numbers. A stock company generally needs at least three directors. Smaller companies with capital under KRW 1 billion can manage with one or two. If a resignation would drop the board below the legal minimum, the outgoing director must stay on until a replacement takes office.

Who actually appoints or removes a director?

In most cases, the general meeting of shareholders holds this power. Directors are appointed and removed by shareholder resolution, and the board cannot do this on its own unless the Articles say so. There is one common exception. When the Articles allow it, the board of directors may appoint the representative director from among its members. Therefore, knowing which body is responsible saves you from convening the wrong meeting.

How do you run the meeting properly?

Getting the procedure right matters as much as the decision itself. For a shareholders’ meeting, the company must send notice at least two weeks in advance, stating the agenda clearly. Smaller companies enjoy some flexibility here. The notice period can shrink to ten days, and if every shareholder agrees, a written resolution can replace the meeting entirely. A resolution passes with a majority of the voting rights present, provided those present represent at least a quarter of all issued shares. Shareholders may also vote by proxy, in writing, or electronically where permitted. For a board meeting, the notice period is shorter, usually one week. A valid resolution needs a majority of directors present, with a majority of those voting in favour.

Why do the minutes matter so much?

Because they are your proof. The company must prepare minutes that record the proceedings and the vote result, signed or sealed by the chairperson and attending directors. Board minutes carry an extra detail worth noting. Directors who disagree should record their objection. Otherwise, the law presumes they approved the resolution, which can expose them to liability later. Keep these records at the principal office, where they remain available for inspection.

What if a director resigns or is removed?

Both routes come with their own rules. A director may resign by submitting a written resignation letter. However, if their departure would leave the board short, they must keep performing their duties until a successor arrives. Shareholders can also remove a director at any time by resolution. In addition, the process protects fairness on both sides:

• A director removed without just cause before their term ends may claim compensation for damages.
• If shareholders refuse to remove a director despite serious misconduct, those holding at least 3% of shares may petition the court within one month.

Which documents do you need to prepare?

Quite a few, honestly. The package typically blends meeting records with supporting identity and seal documents. Expect to gather items such as board and shareholder minutes, a resignation letter, an acceptance letter from the incoming director, seal impression applications, and proof of address for both parties. Foreign directors will usually need notarised and legalised documents. Local counsel normally prepares these in the official format, since the forms are not available for public download.

When must you file, and what happens if you are late?

Here comes the deadline that trips people up. You must file the change with the Commercial Registry Office at the competent District Court within 14 days of the effective date. The registry usually processes a complete filing within three business days. Once registered, the change becomes public through the commercial register, which serves as legal notice to third parties. No gazette announcement is required. Miss the window and an administrative fine applies. The good news is that the registry will still register the change after you pay it, so a delay does not block the update.

Does a director change affect the UBO register?

Sometimes, yes. If the new director qualifies as an Ultimate Beneficial Owner, the company must update its UBO records with financial institutions. This matters most when the appointee gains significant control, or becomes the representative director. In that case, update the information within the same 14-day period. Neglecting this step carries real consequences, including regulatory fines, banking restrictions, and closer scrutiny under anti-money laundering rules.

What does the new director actually take on?

Plenty of responsibility. A new director owes the company a duty of care and a duty of loyalty, acting in the company’s interest rather than that of individual shareholders. Directors share liability for damage caused by breaches of the law or the Articles. In addition, they must supervise fellow directors, participate in board meetings, and support the company’s disclosure obligations. For multinationals, remember that a change in one country can ripple outward. Contractual terms, tax positions, and governance arrangements elsewhere may all need a second look.

Can a foreign national serve as director?

Absolutely. Korean law places no nationality or residency restriction on directors. A foreigner may even act as sole director and sole shareholder. No visa is required simply to hold the role. That said, on-site business activity may call for an appropriate visa under immigration law. Foreign directors can also join board meetings remotely, which suits parent companies with leadership abroad.

What’s next?

Managing a director change requires detailed planning and full legal awareness. For more insights into processes in other jurisdictions, explore our article, Italy’s UBO Register: New Access Rules and a Path to Reopening.

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