If National Security Risks Are Suspected, Foreign Investment Will Be Reviewed Ex Officio

Enforcement Decree of the Foreign Investment Promotion Act Amendment to Take Effect on the 27th

From now on, administrative authorities will be able to review foreign investments ex officio if they are suspected of posing a threat to national security.

The Ministry of Trade, Industry and Energy announced on the 26th that it will implement the amended Enforcement Decree of the Foreign Investment Promotion Act containing these provisions starting from the 27th.

According to the amendment of the Enforcement Decree, even if foreigners do not voluntarily report, administrative authorities will be able to review foreign investments suspected of threatening national security ex officio. However, to enhance predictability for investors, foreign investments that have voluntarily undergone review will, in principle, not be reviewed again.

Foreign investments in companies possessing national advanced strategic technologies will also be added as subjects of security review to prevent illegal foreign investments from undermining our advanced industrial competitiveness. Additionally, if foreigners have undergone similar review procedures under other laws, grounds have been established to omit the review procedure under the Foreign Investment Promotion Act, thereby reducing the double burden on foreign investors.

Along with this, the review period for the Security Review Expert Committee for examining national security threats posed by foreign investments has been reasonably adjusted from the previous 30 days to 90 days, and the review period for the Foreign Investment Committee has been adjusted from the previous 90 days to 45 days. When foreigners request confirmation on whether their investment is subject to security review before filing an investment report, the administrative authority is required to respond within 30 days.

An official from the Ministry of Trade, Industry and Energy stated, "With this amendment, we expect to effectively regulate foreign investments that raise concerns about national security threats while enhancing the predictability for foreign investors investing in the Republic of Korea. Going forward, the government will continue to actively attract foreign investments that contribute to securing Korea’s advanced industrial technological edge, while continuously improving and supplementing the security review system to minimize national security concerns arising from foreign investments."