# Korean Filings — Sungho Park's Obligations

These are Sungho Park's obligations under Korean law (외국환거래법). **Junwon cannot do these — Sungho must do them personally at his Korean bank.**

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## 1. 해외직접투자 신고 (Overseas Direct Investment Report)

### Status
- [ ] Sungho Park files 해외직접투자 신고

### When
**BEFORE the wire transfer.** This is a precondition to the wire. If they wire without this, it is a violation of the Foreign Exchange Transactions Act (외국환거래법).

### Why Required
Sungho Park owns >10% of Palace Fund LLC (a foreign entity). Any Korean resident acquiring ≥10% of a foreign entity must report this as 해외직접투자 to their designated foreign exchange bank before transferring funds.

### How
1. Go to 하나은행 (Hana Bank) — his designated foreign exchange bank — in person or online
2. Submit 해외직접투자 신고서 with:
   - Palace Fund LLC formation documents (Articles of Organization)
   - Investment amount: as agreed
   - Purpose: member investment in US fund
3. Bank reviews and accepts (typically 1–3 business days)
4. Receive acceptance confirmation before wiring

### Penalty for Non-Filing
- Violation amount ≤ ₩2B: fine up to ₩100M
- Violation amount > ₩2B: up to 1 year imprisonment or fine up to ₩100M

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## 2. 외화증권취득보고서 (Foreign Currency Securities Acquisition Report)

### Status
- [ ] Sungho Park files 외화증권취득보고서

### When
After the wire transfer completes.

### How
Filed at the same designated Korean bank. Reports that the foreign security (LLC membership interest) has been acquired.

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## 3. 연간사업실적보고서 (Annual Business Performance Report)

### Status
- [ ] Filed annually while fund operates

### When
Annually. Filed with the designated Korean bank each year.

### What
Reports the fund's annual performance and financial status to the Korean bank, which forwards to the Bank of Korea.

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## 4. 투명단체 선택신청 (Transparent Entity Election)

### Status
- [ ] Filed by May 31 after the first income year

### What
Korea treats a US LLC as an opaque entity by default (세법상 외국법인). Sungho Park can elect to treat it as a transparent entity (조합 과세), which means income is taxed at the partner level as it accrues rather than at distribution. This is generally favorable.

### Deadline
By May 31 of the year following the first year in which the fund earns income.

### Who Files
Sungho Park files this election with the Korean National Tax Service (NTS / 국세청). Ace prepares all forms and instructions.

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## Notes

- All Korean filings are Sungho Park's responsibility — Junwon cannot file on his behalf
- Ace prepares all forms, instructions, and reference materials for Sungho Park
- Items 1 and 2 are done at the bank directly
- Do not wire before item 1 is accepted