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

necessary duties within 1 year of importation. Written or electronic certifications of origin
can be required and are valid for 4 years from the date of issuance; records establishing the
origin of goods are to be kept for a minimum of 5 years after entry. The parties are to meet
within 6 months of the FTA’s date of entry into force to discuss whether “common
guidelines for the interpretation, application, and administration” of the rules of origin and
customs administration chapters of the FTA should be developed.
FTA Chapter 7—Customs Administration and Trade
Facilitation
The Chapter 7 commitments of the U.S.-Korea FTA are largely the same as those negotiated
in recent agreements that the United States has concluded with Peru, Colombia, and the
Dominican Republic and CAFTA countries. 21 The chapter supports many of the General
Agreement on Tariffs and Trade (GATT) goals in the areas of fees and formalities 22 and
publication and administration of trade regulations 23 (table 5-1). The provisions of the FTA
are intended to facilitate the goods clearance process 24 through greater use of information
technology, to establish procedures for resolving disputes, and to improve risk management
and cooperation among parties. The parties would commit to immediate cooperation in the
areas of information exchange, technical advice and assistance for trade facilitation, and
enforcement of customs rules and regulations. Additionally, chapter 7 calls for the immediate
implementation of articles that provide for simplified release procedures, 25 advance
publication of customs regulations, 26 confidential information guidelines, 27 review and appeal
of customs matters, 28 and penalties for customs violations. 29 The agreement also includes a
provision for cooperation in the implementation and operation of the Customs Valuation
Agreement. 30 Moreover, with respect to advance rulings, the parties would commit to a 90day
period for the issue of advance rulings following request, 31 compared to the standard
150-day period found in previous agreements.
In the case of express shipments, such shipments would not be limited by a maximum weight
or customs value, and express shipments valued at $200 or less would not be assessed duties
or taxes or be required to have any formal entry documents, except when expressly identified
by each party’s laws and regulations. Moreover, the period for release of express shipments
would be lowered to within 4 hours of the submission of the necessary documents, compared
21 The implementation language in the U.S.-Korea FTA is stronger than that for recent agreements, in
recognition of the greater capabilities of the Korean Customs Service.
22 See Article VIII of the GATT.
23 See Article X of the GATT.
24 Parties are committed to release goods from port within 48 hours, to the extent possible.
25 USTR, “Final - United States - Korea FTA Texts,” 2007, Article 7.2.
26 Ibid., Article 7.1.3.
27 Ibid., Article 7.6.
28 Ibid., Article 7.8.
29 Ibid., Article 7.9.
30 “The Customs Valuation Agreement of the World Trade Organization sets out a fair, uniform and
neutral system for determining the value of imported goods on which customs officials levy duties. This
system bars the use of arbitrary or fictitious customs values.” USDOC, Trade Compliance Center, “WTO
Agreement on Customs Valuation.”
31 USTR, “Final - United States - Korea FTA Texts,” 2007, Article 7.10.
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