AliExpress Becomes a Korean Company Ahead of Shinsegae Joint Venture... Forfeits Foreign Investment Benefits

Foreign-Invested Enterprise Status Canceled in March
Preliminary Step for Joint Venture with Shinsegae

Chinese e-commerce platform AliExpress Korea has recently dissolved its status as a foreign-invested enterprise and has become a Korean company.

According to industry sources on July 21, AliExpress Korea canceled its registration as a foreign-invested enterprise and filed for business closure in March. Subsequently, it registered as a Korean business entity under the name "AliExpress Korea Yuhan Hoesa."

Currently, in the Ministry of Trade, Industry and Energy's foreign-invested enterprise information, Alibaba.com and Alibaba are still listed as foreign-invested enterprises, but AliExpress Korea is not. The business entity registered on the Korean AliExpress website is also confirmed as "AliExpress Korea Yuhan Hoesa." The representatives are listed as Lei Zhang (Zhang Rui) and Hui Yat Sin Cindy.

No changes are expected in the company's Korean business or services. An AliExpress spokesperson explained, "We have already been operating in Korea and complying with Korean laws, so there will be no business changes."

The registration as a Korean company is interpreted as a move in consideration of establishing a joint venture with Shinsegae Group. Previously, in December last year, Shinsegae Group announced the formation of a joint venture, "Grand Opus Holdings," with Alibaba Group to jointly operate Gmarket and AliExpress.

At that time, the operating entity of AliExpress Korea was "Alibaba.com Singapore E-Commerce Private Limited," which was planned to handle financial, tax, and related matters from Alibaba Group headquarters. However, with this new business registration, it appears that AliExpress Korea will independently handle transactions, payments, financial processing, and tax payments.

The Korea Fair Trade Commission is currently reviewing the business combination related to this matter.

Meanwhile, by becoming a Korean company, it has given up the benefits of being a foreign-invested enterprise. Foreign-invested enterprises are eligible for exemptions from corporate and income taxes under the Foreign Investment Promotion Act, and receive preferential treatment for visa issuance. As a Korean company, these benefits are forfeited, and the company must fulfill legal obligations such as business disclosures and audits.