South Korea’s 2026 Standard Venture Investment Contracts: What Changed
Venture Investment Contracts: What Changed
Contents
- 1. What are the standard venture contracts, and who issues them?
- 2. What is the biggest change in the 2026 revision?
- 3. How do the SPA and the SHA differ?
- 4. What changes in practice under the split structure?
- 5. Which contract type should you use?
- 6. Can you use the standard forms as-is?
- 7. What does this mean for foreign investors?
- Download all 8 standard contracts
- Frequently Asked Questions
“The investor sent us a draft standard contract, and the structure looks completely different from the old one. Where do we even start?”
This is an increasingly common question from founders preparing a seed or Series A round in South Korea. In April 2026, the Korea Venture Capital Association (KVCA) comprehensively revised its standard venture investment contracts, changing the very skeleton of the agreements that had long been used in practice. This article explains what changed and why from a practitioner’s perspective, and lets you download all eight revised standard contracts below.
1. What are the standard venture contracts, and who issues them?
South Korea’s standard venture investment contracts are the model forms used when a venture capital (VC) firm invests in a startup. They are issued by the Korea Venture Capital Association (KVCA). This set is the latest version, comprehensively revised in April 2026 with input from Korea Venture Investment Corp. and the association.
The standard forms are not mandatory law. But because they serve as a common starting point familiar to both investors and portfolio companies, practitioners widely use them as a baseline and then adjust for the specifics of each deal. They also reflect current statutes such as the Venture Investment Promotion Act, the Korean Commercial Act, and the Financial Investment Services and Capital Markets Act, which makes them an important practical reference point.
2. What is the biggest change in the 2026 revision?
The biggest change is the introduction of a split structure. Previously, a single investment agreement combined the terms for “executing the investment” and the terms for “the relationship among shareholders after the investment.” The 2026 revision divides these into two separate contracts.
- Stock Purchase Agreement (SPA) — issuance and subscription of new shares, payment of the investment, conditions precedent, and representations and warranties (the “execution” of the investment).
- Shareholders Agreement (SHA) — prior consent rights, director designation, rights of first refusal, tag-along and drag-along rights, redemption and conversion, and penalty provisions (the “post-investment shareholder relationship”).
The revision also introduces a clause-by-clause risk grading that flags the importance and risk level of each provision, and it updates frequently disputed issues — prior consent rights, redemption rights, conversion rights, IPO provisions, and the joint and several liability of interested parties (founders) — against current 2026 statutes and case law.
3. How do the SPA and the SHA differ?
The two contracts differ in timing and purpose. The SPA governs “the moment the money comes in,” while the SHA governs “the relationship after the money is in.”
| Category | Stock Purchase Agreement (SPA) | Shareholders Agreement (SHA) |
|---|---|---|
| Core purpose | Executing the investment | Post-investment shareholder relations |
| Key clauses | Share issuance, price, payment date, conditions precedent, reps & warranties | Consent rights, director designation, first refusal, tag-along/drag-along, redemption/conversion |
| Period | Mainly through closing | Throughout the holding period (until exit) |
| Follow-on rounds | Signed anew each round | Coordination issues arise as rounds accumulate |
4. What changes in practice under the split structure?
The benefit of the split structure becomes clear when follow-on rounds repeat. If each round packs “investment execution + shareholder relations” into one agreement, the shareholder-relations clauses tend to overlap and conflict across successive Series A, B, and C agreements.
Separating the SPA and SHA lets you draft the execution terms fresh for each round while organizing and consolidating the shareholder-relations terms on a single framework. This also aligns with global contracting practice, such as in the United States. That said, the split structure creates a new management point: keeping the definitions and terms consistent between the two contracts so they do not conflict — something easy to miss in practice.
5. Which contract type should you use?
The 2026 standard contracts come in several types depending on the investment instrument. The contract you use depends on the type of security through which you receive the investment.
| Instrument | Contracts used | Typical situation |
|---|---|---|
| Common stock | Common Stock Investment Agreement + Shareholders Agreement | Simple early-stage investment |
| Convertible preferred stock (CPS) | CPS Investment Agreement + Shareholders Agreement | Preferred equity investment |
| Redeemable CPS (RCPS) | RCPS Investment Agreement + Shareholders Agreement | The most common VC investment, adding a redemption right |
| Convertible bond (CB) | Convertible Bond Investment Agreement | Debt investment with a conversion right |
| Bond with warrant (BW) | Bond with Warrant Investment Agreement | Debt investment with a warrant |
Each type’s detailed clauses and negotiation points are covered one by one in the following articles of this series. You can download every type of standard contract at once below.
6. Can you use the standard forms as-is?
The standard forms are a well-built starting point, but they are not a finished document you can sign as-is. They are drafted to be neutral, so real deals always leave clauses that need adjustment from each side’s perspective — the investor’s and the founder’s.
In particular, the scope of the founder’s joint and several liability, the range of prior consent rights, the terms of redemption rights and penalties, and the scope of representations and warranties are clauses that often lead to disputes. Understanding what these clauses mean for your specific company before signing is the surest way to reduce major downstream risk. Atlas Legal has handled numerous investment contract reviews and negotiations in its corporate counseling practice, and supports clause-by-clause review and negotiation strategy built on the standard forms.
7. What does this mean for foreign investors?
For foreign investors and foreign-invested companies in South Korea — including those in the Incheon Free Economic Zone (IFEZ), spanning the Songdo International Business District, Cheongna International City, and Yeongjong International City — one point deserves attention: the standard contracts and the downloadable forms below are in Korean, and are governed by Korean law. Terms such as redemption rights and founder joint-and-several liability can operate differently than an investor might expect from a U.S.-style term sheet. Reviewing the Korean-language forms with Korean counsel before signing is strongly advisable.
These files are the standard contract forms distributed by the Korea Venture Capital Association (KVCA), revised April 2026. The documents are in Korean. Actual transactions require review and tailoring to the specifics of each deal; these materials are provided as reference forms and do not constitute legal advice on any particular matter.
Frequently Asked Questions
Q. Are the standard venture contracts mandatory in South Korea?
A. No. The standard contracts are not mandatory law but widely used model forms. Because they are a common reference point familiar to both investors and founders, the usual approach is to use them as a starting point and adjust for each deal.
Q. What does the “split structure” mean?
A. It refers to dividing the terms once combined in a single investment agreement into two contracts: the “investment execution” (SPA) and the “post-investment shareholder relationship” (SHA). This is the defining feature of the 2026 revision.
Q. How do RCPS and CPS differ?
A. Redeemable convertible preferred stock (RCPS) is convertible preferred stock (CPS) with an added redemption right. Because RCPS allows the investor to seek repayment under certain conditions, it is the most widely used instrument in Korean VC investment.
Q. Can we simply sign the standard forms?
A. It is not recommended. In particular, the founder’s joint and several liability, the scope of prior consent rights, the terms of redemption and penalties, and the scope of representations and warranties can impose very different burdens depending on your company’s situation, so review before signing is essential.
Q. What format are the downloadable contracts in?
A. They are editable Word (.docx) files, in Korean. Click the type you need in the list below to download it directly.
To consult Atlas Legal on reviewing or negotiating a venture investment contract in South Korea, please contact us at +82-32-864-8300 or info@atlaw.kr.
