BOC Korea and Praxair Korea have been added to the list of Korea’s foreign investment zones (FIZs).
In Youngin, Kyunggi province, BOC Korea and Praxair Korea will produce the gas for semiconductor processing by investing $98.7 billion and $54.1 billion, respectively by 2008.
Foreign investment zones are the selected areas in which foreign-owned businesses are granted incentives such as tax reduction and exemption, free or low lease of industrial sites and customs duties exemption.
The Korean government has recently proposed an easing of the regulations governing FIZs in an effort to encourage more multinational companies to establish regional headquarters in Korea.
Companies established in FIZs are exempt from corporate income tax for ten years and are exempt from significant property acquisition and registration taxes normally levied on the purchase of property. The government also provides infrastructure support to FIZs by paying for the costs of road and water systems (100%), waste disposal facilities (50%), and electricity (50%-100%).
FIZs were created under the Foreign Investment Promotion Act.