Quick Hit
- Digital nomad visas, which give individuals the legal right to work remotely while leaving their country of permanent residence, are gaining popularity in East Asia.
- South Korea’s aim in introducing the digital nomad visa is to encourage high-income foreigners to work and live in South Korea, stimulating growth in the country’s local economy.
- Japan introduced the Digital Nomad Visa in April 2024, allowing holders to work remotely in Japan for up to six months.
As working from home becomes more commonplace due to the COVID-19 pandemic and advances in technology, employers are seeing a surge in employees wanting to work remotely from their home countries. As a result, many countries, especially popular destinations for tourists and digital nomads (such as the United States, Spain, and Italy), have introduced digital nomad visas to allow employees to work remotely in their home countries without the usual obstacles and headaches that come with work permits and tax issues.
Several East Asian countries, including Japan and South Korea, have begun pilot programs, but their initial digital nomad visa programs contain strict eligibility requirements and appear to be more focused on monitoring interest and the economic impact of the visas than on seriously welcoming digital nomads.
South Korea launched a pilot program for digital nomad visas for foreigners on January 1, 2024, and Japan introduced its first digital nomad visa program on April 1, 2024.
South Korea Testing Program
The Digital Nomad Visa is known by different names in different countries. In South Korea, the Digital Nomad Visa is officially called the Workcation Visa. Government officials have suggested that one of the main aims of introducing this work visa is to encourage high-income foreigners (and their families) to work and live in South Korea for an extended period of time (up to two years), hopefully boosting the local economy. (At the same time, South Korea’s conservative approach recognizes that the Digital Nomad Visa may have a negative economic impact on areas outside of major cities.) Applicants for a Workcation Visa must meet certain eligibility requirements. Applicants must:
- They will earn an annual income of 85 million won (about US$66,000) in 2023, double South Korea’s per capita gross national income for the previous year.
- Applicants must be 18 years of age or older and have at least one year of work experience in the same industry.
- Work for an overseas company.
These are by no means easy requirements, but not impossible to meet. Applicants from the United States may be required to submit a job offer letter, pay slips, and bank statements to prove employment and annual income. In addition, applicants may need to submit a clean criminal record as evidenced by a criminal record certificate (e.g., a summary of identity history issued by the Federal Bureau of Investigation (FBI) for U.S. citizens) and proof of private medical insurance with coverage of at least 100 million won (approximately 75,000 USD).
Individuals who meet the requirements can submit the documents to a Korean consulate in their country of residence. Once the visa is approved, the holder can bring it into Korea and apply for a residence card or Korean identity card (known as an Alien Registration Card), which is mandatory for foreigners who plan to stay in Korea for more than 90 days. It is not yet clear whether a residence card is required before starting to work for a foreign employer in Korea. As the visa becomes more widely used, this issue may be addressed by further regulations and court cases.
Japan Digital Nomad Visa
Japan’s Ministry of Justice has launched a new Digital Nomad Visa program starting April 1, 2024. Similar to the South Korean pilot program, the Digital Nomad Visa sets out several requirements for each applicant, including:
- Applicants must be nationals of a country on the Immigration Services Agency’s list of permitted countries.
- Applicants will be required to work remotely in Japan for a period not to exceed six months.
- Applicants must have an annual income of 10 million yen (approximately US$64,000).
Applicants must submit the following documents to the Japanese embassy or consulate in their country of residence: passport, tax receipt, income certificate, employment contract or job offer letter, and proof of insurance covering death, injury or sickness during their stay in Japan for at least 10 million yen (approximately US$64,000).
It is worth noting that South Korea’s workcation visa scheme allows holders to stay in South Korea for one year with an option to extend for up to two years, while Japan’s digital nomad visa limits stay to six months with no option to extend.
Implications and Considerations for Employers
Digital Nomad Visa do not have It is a solution for employers who have a business interest in employing employees abroad to perform tasks related to Korea or Japan and to generate profits in the respective markets. Rather, the Digital Nomad Visa is designed for the narrow purpose of the holder working for a foreign employer. Visa holders are strictly prohibited from being employed by local Korean or Japanese companies or engaging in commercial activities to earn income in these territories.
Given these limitations, employers may need to be cautious about using digital nomad visas if they are sending employees to South Korea or Japan to work with local offices or engage in activities that could generate lucrative business in the local market.
Additionally, both South Korea and Japan provide local legal instruments that apply to employment relationships where work is typically performed within their territories. This could create significant complications for employers, as South Korea and Japan’s employment laws are known to be very protective of employees, especially when it comes to termination rights. Time will tell how these countries’ new digital nomad visa programs will interact with the existing employment law landscape in South Korea and Japan.
Therefore, despite recent trends in East Asia, the digital nomad visa has limited scope and may not necessarily be a foolproof option for foreign companies sending employees to these regions. If companies allow their employees to go abroad for personal reasons on a digital nomad visa, they run the risk of having to comply with the laws of the host country. For example, the implications are different when a US company sends a US employee abroad for business purposes, as they are not expected to comply with the employment laws of that country.
