How U.S. Companies Can Start Taking Advantage of the U.S.-Korea Trade Agreement
March 6, 2012The Office of Japan and Korea within the Market Access and Compliance unit of the International Trade Administration assists U.S. firms that are encountering trade and investment barriers in Japan and Korea.
The U.S.-Korea Trade Agreement will enter into force on March 15, 2012.
What does that mean for our companies – both those who are already doing business in Korea as well as those who are considering entering the Korean market for the first time? How can companies ensure that their products will receive preferential treatment on or after March 15?
On the first day the agreement takes effect, March 15 of this year, almost 80 percent of U.S. exports to Korea of consumer and industrial products can be imported duty-free. Nearly 95 percent of remaining tariffs will be eliminated within 5 years after that date, and most remaining tariffs will be eliminated within 10 years.
A web-based resource created by the International Trade Administration, the FTA Tariff Tool, is a great way to see if your product would benefit under the agreement. The database conveniently links to the latest U.S. tariff schedule and relevant rules of origin, helping you to determine the exact tariff benefit for your product and the rate at which the tariff is eliminated.
Additionally, nearly two-thirds of all U.S. exports of agricultural products to Korea will become duty-free starting March 15. This agreement also includes a number of significant non-tariff commitments that will come into force on March 15, including obligations to be transparent when developing and passing new regulations and laws that affect bilateral trade.
Commitments on strengthened protections for intellectual property rights benefiting American creators and innovators will also come into force on that day. Finally, commitments opening Korea’s $580 billion services market will also be in effect beginning March 15.
To ensure that your company’s product will benefit under the agreement, you will need to determine that the product is originating in either the territory of the United States or Korea under the rules of the agreement, and claim U.S.-Korea trade agreement benefits when importing.
U.S. Customs and Border Protection (CBP) will soon publicly release implementation instructions and interim regulations regarding U.S. imports under the agreement. Importers should closely monitor CBP’s FTA website and send inquiries on U.S. imports directly to fta@dhs.gov.
For more information, you can also contact your local U.S. Export Assistance Center and the U.S. Commercial Service at the American Embassy in Seoul, Korea.
The International Trade Administration’s U.S.-Korea Trade Agreement Portal should be your next stop!
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