Company: OSRH
Filing Date: 2025-04-22
Form Type: 10-K
Source: 0001213900-25-034116
Chunk: 107

Company: OSR Holdings, Inc.
Filing Date: 2025-04-22
Form: 10-K
Item: Item 1
Chunk 107
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 (ii) most of the members of the board of directors of our largest subsidiary, OSR, are Korean; and (iii) after
the Closing, important documents, including the accounting documents of our domestic business, may be maintained and controlled in Korea.
If we are deemed to have a “place of effective management” in Korea, we will be required to file annual corporate income tax
returns with the Korean tax authorities and be subject to Korean corporate income tax. Currently, the applicable rates are 11% (inclusive
of local corporate taxes) for taxable income up to 200 million Korean Won, 22% (inclusive of local corporate taxes) for taxable income
exceeding 200 million Korean Won and less than 20 billion Korean Won, 24.2% (inclusive of local corporate taxes) for taxable
income greater than 20 billion won and less than 300 billion Korean Won, and 27.5% (inclusive of local corporate tax) for taxable
income greater than 300 billion Korean Won. Taxable income would include any worldwide income, such as dividends we receive from
our Korean operating company and any interest income earned outside of Korea. If we are required to pay Korean corporate income tax, it
may reduce our cash flow and negatively impact the returns to investors.

55

If we are deemed to have a “permanent establishment” in
Korea, we will be subject to Korean corporate income tax with regards to any Korean source income attributable to or effectively connected
with such permanent establishment.

Under Korean law, where a foreign corporation has a fixed place for
the operation of all or part of its domestic business, the foreign corporation shall be deemed to have a “permanent establishment”
in Korea. In addition, even if a foreign corporation does not have a physical fixed place of business in Korea, it is deemed to have a
“permanent establishment” in Korea if it operates the business in Korea through persons (the “Dependent Agent(s)”)
who are authorized to conclude business contracts under the name of the foreign corporation.

According to the Supreme Court of Korea, in order for a foreign corporation
to be considered to have a physical “permanent establishment” in Korea, the foreign corporation must have a fixed place of
business, such as a building or facility in Korea that the foreign corporation has the right to dispose of or use, and the employees or
persons under its direction must carry out essential and important business activities, rather than