Law and Taxation of Corporate Merger and Division in Korea

16 Pages Posted: 24 Jan 2005

See all articles by Chang Hee Lee

Chang Hee Lee

Seoul National University - College of Law


Traditionally the concept of tax-free corporate reorganization has not existed in Korean law and the rules for merger and division were pervaded by a mystic theory of the fusion of juridical personalities extrapolated from corporate law metaphysics, imported from an old and now defunct German theory. This metaphysical theory proved irrelevant during the economic crisis and the subsequent law reform, following the economic crisis of 1997 and 1998, which introduced a tax-free merger, division and other forms of corporate restructuring. This paper reviews the overall structure of and specific issues about the new tax rules in interaction with new corporate law. It shows that the new rules are based on a juxtaposition of real world problems and metaphysical legal dogma, combined with a superficial and dogmatized understanding of foreign laws. The final outcome of current law is a mere importation of the hard shell of foreign legal concepts, which fails to address the real world problems in the right way.

Keywords: Tax, corporate, law

JEL Classification: K22, K34

Suggested Citation

Lee, Chang Hee, Law and Taxation of Corporate Merger and Division in Korea. Journal of Korean Law, Vol. 3, No. 2, 2003. Available at SSRN:

Chang Hee Lee (Contact Author)

Seoul National University - College of Law ( email )

San 56-1 Kwanak-gu, Shilim-dong
Seoul, 151-742

Register to save articles to
your library


Paper statistics

Abstract Views
PlumX Metrics