It has been confirmed that the China-based e-commerce platform AliExpress has liquidated its foreign investment corporation status in Korea and has officially transitioned to a Korean corporation. It has moved away from direct control by its parent company, Alibaba Group, and established an independent operational structure.
According to related industry sources on the 21st, AliExpress Korea removed its foreign investment corporation registration in March and changed its name to "AliExpress Korea Co., Ltd." to report itself as a domestic corporation. AliExpress stated, "It is correct that we transitioned to a Korean corporation starting in March."
Under the Foreign Investment Promotion Act, foreign-invested corporations registered in Korea can receive various tax benefits, such as reductions in corporate and income taxes, and preferential treatment regarding visa issuance. However, AliExpress seems to have chosen to transition to a domestic corporation while voluntarily giving up these benefits.
Industry analysis suggests that this decision is not unrelated to the recent strategic collaboration with Shinsegae. Shinsegae's subsidiary Gmarket agreed in December of last year to establish a joint venture with Alibaba Group's global corporation "Alibaba International," each holding a 50% equity stake.
If the operations of the joint venture are solely driven by headquarters' directives, questions regarding transparency in terms of cash flow and tax management may arise. Accordingly, AliExpress is interpreted as demonstrating its willingness to establish a transparent management system by transitioning its corporate structure to a Korean corporation and strengthening trust with its cooperative partners.
An AliExpress representative said, "Giving up the foreign investment corporation status is a significant decision for the corporation," adding, "We see the Korean market as a key market in the mid to long term, and we are determined to grow responsibly as a local corporation."