U.S.-Korea Free Trade Agreement: Potential Economy-wide ... - USITC

use of TBTs to protect Korea’s auto market from imports. 49 As such, this would be the first
time a TBT chapter of an FTA negotiated by the United States would contain provisions that
address TBTs with respect to a specific industry. 50 Other U.S. product sectors that would
potentially benefit from the provisions include pharmaceuticals, medical devices,
biotechnology, cosmetics, transportation equipment, telecommunications and other IT
equipment, electrical equipment and household appliances, construction materials and
equipment, food and beverage products, and energy services and equipment. 51
U.S. industry and government officials indicate that in their view Korea’s application of its
certification, testing, regulatory, labeling, and other standards-related practices often do not
conform with WTO guidelines and, thus, serve as TBTs. 52 The United States and other
Korean trading partners contend that “lack of transparency and insufficient coordination
[have] generated a rather complex standardization and certification system,” with Korean
regulatory agencies’ rules too often overlapping one another. 53 The Korean government
reportedly sometimes issues new regulations without adequate public consultation and
comment opportunities. 54 The FTA addresses these issues by increasing both transparency
and opportunities for U.S. industry participation in the Korean standards process. 55 This
should reduce the likelihood of duplicative or discriminatory technical regulations being
developed in Korea that could serve as technical barriers to U.S. exports.
U.S. industry officials contend that Korea’s technical regulations and conformity assessment
procedures currently apply differently to imports than to domestic products. 56 They state that
Korean regulatory authorities often require that imported products such as medical devices,
pharmaceuticals, chemicals (and chemical products), and electronics, and information
technology equipment have prior regulatory approval in their home countries before they
may be submitted for approval consideration in Korea. 57 Further, Korea reportedly
sometimes requires use of “standards unique to Korea even when international standards
49 Stangarone, “Anatomy of a Deal: The U.S.-Korean FTA,” April 2007, 1.
50 Although not as extensive as the automotive provisions, the proposed FTA also includes a provision
requiring each party to take steps to implement Phase II of the APEC Mutual Recognition Arrangement for
Conformity Assessment of Telecommunications Equipment with respect to the other party as soon as
possible for the purpose of reducing technical and regulatory barriers to trade in this sector. USTR, “Final -
United States - Korea FTA Texts,” 2007, Article 9.5.5.
51 USCIA, “Korea, South,” June 19, 2007, 1; EIU, “Country Commerce: South Korea,” July 2006, 106;
USTR, “Korea,” 2006 National Trade Estimate Report on Foreign Trade Barriers, March 31, 2006,
358–361; and U.S. industry officials, telephone interviews by Commission staff, May 7–9, 2007. For
additional information on tariff and nontariff measures in Korea potentially affecting the U.S. automotive
industry, see the sector-specific analysis on motor vehicles in chap. 3.
52 Kiyota and Stern, “Economic Effects of a Korea-U.S. Free Trade Agreement,” 2007, 8; USFCS, “Korea
Trade Regulations and Standards,” 2005, 76–81; and U.S. industry officials, telephone interviews by
Commission staff, May 7–9, 2007.
53 WTO, Trade Policy Review Body (TPRB), “TPR, Republic of Korea, Report by the Secretariat,”
September 17, 2004, 58.
54 USFCS, “Korea Trade Regulations and Standards,” 2005, 76–81.
55 Dawson, testimony before the USITC, June 20, 2007, 71.
56 Primosch, testimony before the Trade Policy Staff Committee, Office of the USTR, March 14, 2006, 5;
Dawson, testimony before the USITC, June 20, 2007, 127; and U.S. industry officials, telephone interviews
by Commission staff, May 7–9, 2007.
57 EIU, “Country Commerce: South Korea,” July 2006, 106; USTR, “Korea,” 2007 National Trade
Estimate Report on Foreign Trade Barriers, April 2, 2007, 358–361; Gross and Minot, “Medical Device
Registration in Korea: An Overview,” January 2007, 1–4; and U.S. industry officials, telephone interviews
by Commission staff, May 7–9, 2007.
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