United States - Korea Free Trade Agreement

Country / jurisdiction: Korea · Year: 2012 · Status: In force · Level: International · Type: Voluntary

The United States-Korea Free Trade Agreement provides for the elimination of tariffs for the following goods, among others:

Electric generation equipment

Mechanical equipment including pumps, appliances, and other advanced machinery

Electric motors, transformers, batteries, and capacitors

Motor vehicles

Mineral ore and processed products including graphite, manganese, copper, aluminium, and nickel

Various products manufactured using above minerals and metals such as sheets, powders, bars, and plates

Photovoltaic cells (import into Korea only)

The Agreement states goods are counted as originating from each country if they:

are wholly produced or obtained in the country (applicable to minerals, raw materials, and waste and scrap materials)

meet specific standards for the good as defined in the Agreement (applicable largely to manufactured goods) which mainly cover changes in HS codes and minimum regional value content (RVC) requirements

The Investment-related provisions of the Agreement forbids the implementation of pre-conditions such as mandatory export quotas, domestic content requirements, technology transfer, and other non-tariff barriers. National treatment and most-favoured nation treatment provisions also apply to investors from either countries, notably implying they are to be treated equally to domestic investors.

The Agreement allows either party to take temporary safeguard measures in the event of serious financial difficulties, threats, or other exceptional circumstances.

The second renegotiation of the Agreement in 2027 led to :

the introduction of quotas for Korean steel and aluminium imports into the US in exchange for an exemption in US import tariffs on those commodities

increasing waiver quota for safety standards, harmonizing ICE vehicle emissions testing, and providing reprieve for US automakers in meeting Korea fuel economy standards, all favourable to US vehicle imports to Korea.

Official source: https://ustr.gov/trade-agreements/free-trade-agreements/korus-fta/final-text