FATF status

South Korea is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The latest follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in South Korea was undertaken by in 2024. According to that Evaluation, South Korea was deemed Compliant for 13 and Largely Compliant for 20 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 5 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

The Republic of Korea (ROK) has implemented various measures to combat corruption, including the 1983 Public Service Ethics Act, which mandates asset disclosure by high-ranking officials, and the 2008 Anti-Corruption Act that focuses on reporting corruption and protecting whistleblowers. Despite these efforts, political corruption remains a significant issue, highlighted by the conviction of four former presidents and the enactment of strict anti-corruption laws such as the Kim Young-ran Act. The ROK continues to enhance its anti-corruption framework, with recent reforms aimed at increasing transparency and accountability in both public and private sectors.

South Korea boasts a dynamic economy characterized by political stability, a skilled workforce, and significant foreign investment opportunities, particularly following market liberalization in the 1990s. However, foreign investors face challenges due to a complex regulatory framework and competition from lower-cost producers, prompting the government to implement reforms aimed at improving the investment climate and aligning regulations with global standards.

South Korea's investment climate is characterized by political stability, a skilled workforce, and a welcoming attitude towards foreign investment, bolstered by the revised U.S.-Korea Free Trade Agreement (KORUS) that provides U.S. investors with broad market access. However, foreign investors face challenges due to a complex regulatory framework and issues such as regulatory opacity and labor policies. The government has initiated reforms, including the establishment of a Foreign Investment Ombudsman and a regulatory sandbox program, to enhance the investment environment and align regulations with global standards.