Yoo Som-Na, 47, was arrested Tuesday at her Paris residence under an international arrest warrant issued in connection with the investigation into a disaster that claimed around 300 lives, most of them schoolchildren.
A judge will decide later on Wednesday whether she should be detained in custody pending a decision on whether to extradite her to South Korea, which could take several months or longer if she contests it.
Yoo Som-Na is the daughter of Yoo Byung-Eun, the head of the family which controls Chonghaejin Marine Co., the company which owned and operated the Sewol ferry that capsized and sunk on April 16 with hundreds of high-school students on board.
Yoo and his eldest son Yoo Dae-Kyun are being hunted by Korean authorities who suspect breaches of legal safety standards may have led to a tragedy that moved the whole world.
South Korean President Park Geun-Hye on Tuesday denounced fugitive members of the family as the "root cause" of the disaster. The government has offered a half-million dollar reward for information leading to the arrest of the father and 100,000 dollars for Yoo Dae-Kyun.
Korean prosecutors want to question the two men, Yoo Som-Na and another son who lives in the United States in connection with possible charges of embezzlement, tax fraud and criminal negligence.
Yoo has no direct stake in Chonghaejin, but his children and close aides control it through a complex web of holding companies.