Foreign Universities and Hospitals in the Special Economic Zones Permitted to Remit Profits to Home

The government is likely to permit the branches of foreign colleges and hospitals in the special economic zones to be established in metropolitan areas, Busan and Gwangyang in early next year to send profits to their own countries. Then, branches of famous foreign colleges and multinational hospital chains would show interests in moving into the special economic zones.

According to the Ministry of Finance and Economy (MOFE), the Ministry of Education and Human Resources Development (MOE) and the Ministry of Health and Welfare (MHW) on the 19th, the government is considering permitting schools and hospitals to remit the fruits to home as a measure to make Korea a business hub in northeast Asia.

MOFE decided to prepare the `regulations on the establishment of special economic zones` (tentative title) containing specific contents by the end of June, and get approval of the Congress within this year.

An authority from MOFE said, “we are considering such measures to attract the branches of foreign colleges and pharmacies into the special economic zones of Busan, Gwangyang, and the metropolitan area, which covers Youngjongdo, Gimpo reclaimed land site, Songdo New Town and Sangamdong, ”

The authority explained, “it might reduce the leakage of the national wealth for the quality medical services and the college education. It might be operated just within the areas the special law permits avoiding social stirs. ”

Moreover, the government decided to consider permitting the remittance to home by the educational institutions and hospitals established by foreign foundations in Jeju Island after revising the special law on Jeju Free International City put into force from early this year.

However, the permit of remittance by educational institutions and large hospitals may cause protests of domestic schools and hospitals creating a stir, as it is an exception to current law that allows only nonprofit schools and hospitals.

Current education law and medical law regulate that profit organization cannot establish and run schools or hospitals, and that the yielded profit should be reinvested.

Joong-Hyun Park sanjuck@donga.com