Enhanced Monitoring Report on the Implementation of the Standard on Transparency and Exchange of Information on Request 2025

Korea

Korea joined the Global Forum in 2009. Korea underwent its Second Round of EOIR Peer Review in 2020 (Korea’s 2020 Report),1 which assessed the legal and regulatory framework in force as at 28 April 2020 and its practical implementation, including in respect of EOI requests received and sent, during the review period from 1 January 2016 to 31 December 2018. Korea received an overall rating of Largely Compliant and the individual Elements were rated as follows:

 

	A.1	A.2	A.3	B.1	B.2	C.1	C.2	C.3	C.4	C.5	Overall
Determinations	i.p.b.	i.p	i.p.b.	i.p	i.p.	i.p.	i.p.	i.p	i.p.	n.a.	LC
Ratings	PC	LC	LC	C	C	C	C	C	C	C

Status of implementation of recommendations issued in the peer review report

Korea received six in-box recommendations in relation to Elements A.1, A.2, A.3, C.1 and C.5.

This monitoring report assesses the actions taken by Korea to address the recommendations issued in its EOIR Peer Review Report and the peer input received for the monitoring period 2023-2024.

The report concludes that two recommendations are “in the process of being addressed”, while the remaining four recommendations “have not been addressed” so far, and it advises on actions required.

Element A.1: Availability of ownership and identity information

1. Identification of beneficial owners and availability of beneficial ownership information

 

Recommendation (A.1, framework)	Korea is recommended to ensure that comprehensive beneficial ownership information in line with the standard is available in respect of all relevant legal entities and arrangements.
Underlying factor	While the vast majority of companies, partnerships and trusts would have an account with a Korean financial institution, which is required to keep beneficial ownership information, there is no obligation for companies, partnerships or trustees of personal trusts to engage a financial institution. The definition of beneficial ownership for companies applied by financial institutions is in line with the standard; however, the determination for partnerships follows the approach for companies, including taking a 25% threshold as a starting point, which is not always in accordance with the form and structure of partnerships. For trusts, it is not clear whether information on “any other natural person exercising ultimate control over the trust” will be available. A considerable amount of information relevant for the identification of beneficial owners will be available with the tax administration; however, the scope of this information may not match the definition of beneficial owner under the standard. (see paragraphs 66 et seq., 105 et seq., 129 et seq. of Korea’s 2020 Report for more information)
Summary of actions reported	Pursuant to a legislative amendment introduced in February 2022, the tax authorities have the power to seek information of representative(s) and executive(s) and a person who actually controls the company or organisation, when it is difficult to determine the actual owner based on the ownership stock or investment interest. Further, the Ministry of Economy and Finance is in discussions with relevant agencies to – i) set up a system that requires taxpayers to report and regularly update a business bank account within a specified period after filing for a business licence; and ii) amend the AML/CFT Regulations to include “any other natural person exercising ultimate control over the trust” in the method for identifying beneficial owners of trusts.
Conclusion	The access power available to the tax authorities does not compensate definitional gaps on beneficial ownership. Korea has taken preliminary steps to address the recommendation, but no material progress has been reported for more than three years since the recommendation was issued. It is urged to make substantive progress before the next self-assessment.
Status determined	Has not been addressed
Actions required	Korea should submit a schedule for completion of steps to address the recommendation and an update on the progress made by 31 March 2026. In particular, Korea should – Provide the actions taken to address the recommendation, i.e. relevant changes in the legal and regulatory framework that ensure the availability of beneficial ownership information of all relevant legal entities and arrangements. Provide the actions taken to ensure that beneficial owners of partnerships and trusts are identified in line with the standard. Report actions and supporting implementation details taken to enforce changes to the legal and regulatory framework.

2. Ownership information of inactive entities

 

Recommendation (A.1, practice)	Korea is recommended to review its system, whereby a significant number of inactive companies remain with legal personality on the commercial register, to ensure that legal and beneficial ownership information is available.
Underlying factor	There are a large number of inactive companies that maintain legal personality but are not being supervised by the tax administration. This raises concerns that legal and beneficial ownership information might not be available in all cases. (see paragraphs 83 et seq. of Korea’s 2020 Report for more information)
Summary of actions reported	A legislative amendment has entered into effect on 28 February 2025, whereby information on annual corporate registrations will be shared with the tax authorities by 31 March each year. Procedurally, the tax authorities must send a request to the Register Office for the data. The first of such exchanges was completed on 26 May 2025. This will enable the tax authorities to identify the inactive entities and to monitor them effectively.
Conclusion	Korea has taken preliminary steps to address the recommendation through legislative changes to allow the Register Office to, upon request, exchange companies’ registration data with the tax authorities, but no material progress has been reported for more than three years since the recommendation was issued. It is urged to make substantive progress before the next self-assessment.
Status determined	Has not been addressed
Actions required	Korea should submit a schedule for completion of steps to address the recommendation and an update on the progress made by 31 March 2026. In particular, Korea should – Report substantive steps towards reducing the risk that the significant number of inactive companies that retain legal personality, pose to the availability of ownership information, including details on the supervisory measures taken by the tax authorities and their outcomes. Report material progress on addressing the recommendation to ensure that legal and beneficial ownership information is available in all cases.

Element A.2: Availability of accounting information

3. Accounting records of inactive entities

 

Recommendation (A.2, practice)	Korea is recommended to review its system, whereby a significant number of inactive companies remain with legal personality on the commercial register, to ensure that accounting records are available.
Underlying factor	There is a large number of inactive companies on the commercial register that maintain legal personality and may not be complying with the obligation to maintain accounting records. (see paragraphs 163 et seq. of Korea’s 2020 Report for more information)
Summary of actions reported	A legislative amendment has entered into effect on 28 February 2025, whereby information on annual corporate registrations will be shared with the tax authorities by 31 March each year. Procedurally, the tax authorities must send a request to the Register Office for the data. The first of such exchanges was completed on 26 May 2025. This will enable the tax authorities to identify the inactive entities and to monitor them effectively.
Conclusion	Korea has taken preliminary steps to address the recommendation through legislative changes to allow the Register Office to, upon request, share companies’ registration data with the tax authorities, but no material progress has been reported for more than three years since the recommendation was issued. It is urged to make substantive progress before the next self-assessment.
Status determined	Has not been addressed
Actions required	Korea should submit a schedule for completion of steps to address the recommendation and an update on the progress made by 31 March 2026. In particular, Korea should – Report substantive steps towards reducing the risk that the significant number of inactive companies that retain legal personality, pose to the availability of accounting information, including details on the supervisory measures taken by the tax authorities and their outcomes. Report material progress on addressing the recommendation to ensure that accounting records are available in all cases.

Element A.3: Availability of banking information

4. Identification of beneficial owners of bank accounts

 

Recommendation (A.3, framework)	Korea is recommended to ensure that beneficial ownership information in line with the standard is available in respect of partnerships and trusts.
Underlying factor	Financial institutions hold a significant amount of information on the beneficial owners of a partnership and a trust; however, the determination for partnerships follows the approach for companies, including taking a 25% threshold as a starting point which is not always in accordance with the form and structure of partnerships. For trusts, it is not clear whether information on “any other natural person exercising ultimate control over the trust” will be available. (see paragraphs 174 and 175 of Korea’s 2020 Report for more information)
Summary of actions reported	Korea considers that since February 2022, the power available to tax authorities to seek information of representative(s) and executive(s) and a person who actually controls the company or organisation, when it is difficult to determine the actual owner based on the ownership stock or investment interest addresses the recommendation. Further, the Ministry of Economy and Finance is in discussions with relevant agencies to amend the AML/CFT Regulations to include “any other natural person exercising ultimate control over the trust” in the method for identifying beneficial owners of trusts.
Conclusion	No material progress has been reported for more than three years since the recommendation was issued. The access power available to the tax authorities does not compensate definitional gaps on beneficial ownership (more so in respect of bank accounts as bank accounts may also be held by persons who do not fall into the category of “taxpayers” in Korea). Korea has taken preliminary steps to address the recommendation. It is urged to make substantive progress before the next self-assessment.
Status determined	Has not been addressed
Actions required	Korea should submit a schedule for completion of steps to address the recommendation and an update on the progress made by 31 March 2026. In particular, Korea should – provide the actions taken to address the recommendation as applicable in the context of banks, i.e. relevant changes in the legal and regulatory framework that will allow identification of beneficial owners of all bank account holders in line with the standard. report actions and supporting implementation details undertaken to enforce changes to the legal and regulatory framework.

Element C.1: EOIR instruments

5. Interpretation of foreseeable relevance

 

Recommendation (C.1, practice)	Korea is recommended to continue clearly communicating with all of its EOI partners to ensure that its interpretation of the foreseeable relevance standard is consistent with Article 26(1) of the OECD Model Convention.
Underlying factor	Korea had problems communicating with one EOI partner regarding the interpretation of the foreseeable relevance standard in 3.5% requests received during the review period. (see paragraphs 231 et seq. of Korea’s 2020 Report for more information)
Summary of actions reported	Korea has been engaging with EOI partners to enhance mutual understanding of foreseeable relevance of requests. In all cases where the foreseeable relevance of the request was not established, clarifications were sought from partners. If no clarifications were received in 30 days, the requests were recorded as “declined for valid reasons”. During the monitoring period, clarifications were sought in 6.55% cases (i.e. 15 requests).
Conclusion	Korea has made progress to address the recommendation and has been engaging with EOI partners to have a mutual understanding of foreseeable relevance. Nevertheless, no internal guidelines are available on establishing foreseeable relevance of incoming requests.
Status determined	In the process of being addressed
Actions required	In its next self-assessment in 2028, Korea should – provide internal guidelines on establishing foreseeable relevance of incoming requests.

Element C.5: Effective exchange of information

6. Provision of status updates

 

Recommendation (C.5, practice)	Korea is recommended to continue to ensure that it provides status updates in all cases where it takes over 90 days to provide a response.
Underlying factor	Korea did not provide any status updates in the first year of the review period. Korea introduced updates to its computer system which increased the number of status updates being provided in the last year of the review period to 65%.
Summary of actions reported	Korea provides status updates in all cases where it takes over 90 days to provide a response.
Conclusion	Korea has made progress to address the recommendation. Although Korea reported that status updates are provided in all cases, the statistics provided show that status updates were only provided in 26 out of 34 cases (76%) for which they should have been provided; thus, there is room for improvement. Korea should report further progress in the next self-assessment.
Status determined	In the process of being addressed
Actions required	In its next self-assessment in 2028, Korea should – provide updated timeliness statistics, including on status updates

EOIR experience

Over the monitoring period, Korea received 229 requests and sent 194 requests. Japan, China and Viet Nam were the top three treaty partners in respect of both incoming and outgoing requests. In addition, two requests sent by a peer in 2023 were not received by Korea. The peer resent the requests in 2025, and Korea considers these requests as a part of its 2025 inventory.

Korea reported providing full and final responses in 96% of all the received requests. The peer input indicates that generally tax, accounting and asset related information of companies was exchanged during the monitoring period. The timeliness of responses has improved since the 2020 Report, most notably on the proportion of responses provided within 90 days – from 33% to 85%. One remaining request received during 2023 continues to be pending.

Ten peers provided input on Korea. Nine peers, including one peer for whom Korea is one of the top five partners in terms of volume of exchanges, considered the bilateral EOI relationship to be generally satisfactory and found it easy to contact Korea. Four peers who received requests from Korea during the monitoring period confirmed that the quality of requests was satisfactory. Five peers who had sent EOI requests to Korea during the monitoring period expressed satisfaction with the responses provided by Korea.

New developments having a bearing on the EOIR standard

No recent developments that could have a bearing on the EOIR standard (other than those reported to address recommendations) have been reported by Korea or have otherwise come to light.

Next steps

Korea should continue taking actions towards implementing the standard effectively.

The following next steps are expected from Korea:

• For the four recommendations where lack of material progress has been identified for more than three years since the last review, Korea should submit to the PRMG - i) a schedule for completion of steps to address the recommendation and ii) an update, including details on the progress on such recommendations by 31 March 2026.

  • Recommendation 1, on identification of beneficial owners and availability of beneficial ownership information (Element A.1)

  • Recommendation 2, on ownership information of inactive entities (Element A.1)

  • Recommendation 3, on accounting records of inactive entities (Element A.2)

  • Recommendation 4, on identification of beneficial owners of bank accounts (Element A.3).

• Submit its next self-assessment in 2028 under the second round of enhanced monitoring.

Views/response of the monitored jurisdiction

Korea would like to express its appreciation for the hard work done by the Secretariat in preparing the monitoring report. Korea would also like to thank the Peer Review Monitoring Group (PRMG) for their valuable contributions to this report.

Korea is of the view that this monitoring report of the enhanced monitoring process gives us an opportunity to see more closely and assess our legal and administrative processes at this stage and enable us to seek what to be done more to improve our system overall.

Taking note of the status determined and the actions required, Korea will continue updating its progress with the Global Forum by March 2026 and in the next Self-Assessment in 2028.

In the meantime, Korea remains fully committed to the global standard for EOIR and will continue our effort to bring both legislations and practices of Korea to be fully in line with the standard requirements.

Note

← 1.  OECD (2020), Global Forum on Transparency and Exchange of Information for Tax Purposes: Korea 2020 (Second Round): Peer Review Report on the Exchange of Information on Request, Global Forum on Transparency and Exchange of Information for Tax Purposes, OECD Publishing, Paris, https://doi.org/10.1787/97daef15-en.