U.S. – Korea Free Trade Agreement
The United States-Korea Free Trade Agreement (KORUS) entered into force on March 15, 2012. On the day of implementation, almost 80 percent of U.S. industrial goods exports to Korea became duty-free, including aerospace equipment, agricultural equipment, auto parts, building products, chemicals, consumer goods, electrical equipment, environmental goods, travel goods, paper products, scientific equipment and shipping and transportation equipment. Other benefits of the FTA include stronger protection and enforcement of intellectual property rights in Korea and increased access to Korea’s $580 billion services market for highly competitive American companies.
Rules of Origin
For goods that are not wholly obtained, you must meet the product’s rule of origin, usually through Tariff Shift or Regional Value Content. Learn more about how to Read and Apply FTA Rules of Origin. The rules of origin may be found in the final text of the FTA. Occasionally, a particular rule of origin may be revised. For the most updated version of the ROOs consult the Harmonized Tariff Schedule of the United States, General Notes — General Note 33.
In addition to the above rules of origin, there may be other ways to qualify your product:
- Accumulation may allow the producer to reduce the value of the non-originating materials used in the production of the good.
- De Minimis allows the exporter to disregard a very small percentage of non-originating materials the do no meet a tariff shift rule.
- Direct Shipment are goods which must be shipped directly from one FTA party to another FTA party.
- Fungible Goods and Materials refers to goods or materials (components) that are interchangeable for commercial purposes and whose properties are essentially identical.
- Indirect Materials are goods used in the production, testing or inspection of a good but not physically incorporated into the good.
No specific certificate is required for the U.S. – Korea FTA. You may be requested by the importer or the Korean Customs Service to provide information to support a claim of preferential treatment. More information on what to include can be found in Free Trade Agreements Certificates of Origin. Please note that the Korean Customs Service does not mandate a specific Certificate of Origin document under KORUS, nor is there a prescribed form or format for certifying origin. U.S. exporters or producers should be advised that as long as you provide the elements necessary to complete a certification, you should not need to use the Korean Customs Service’s sample Certificate of Origin or any Korean Government prescribed form, although you are free to do so.