The Korea-ASEAN FTA has upgraded to the next level to greatly improve the convenience of Korean export firms.
Yoon Sang-jik, the minister of trade, industry and energy, and trade ministers in the 10 ASEAN countries signed the revised commodity protocol in a meeting of ASEAN Economic Ministers held in Malaysia on Aug. 23.
The Korea-ASEAN FTA is the fourth free trade agreement signed by South Korea. This revised protocol includes new regulations to improve the current somewhat protective system, and to simplify trade procedures.
Once the protocol takes effect, domestic export companies will make much better use of the FTA through the introduction of a business-friendly system, and exports to the ASEAN countries will expand, based on the Korea-ASEAN FTA.
The revised commodity protocol includes the introduction of regulations for trade facilitation, the improvement of the reciprocity system, and the materialization of the tariff reduction plan by year.
First of all, electronic certificates of origin will be officially recognized under the agreement. Under the existing agreement, companies have to choose a method to calculate added value within the region between either the direct or the build-down way, according to its country. However, it will be changed to a more flexible direction that each company can choose the method to its own advantage.
Also, the Korea-ASEAN FTA is newly adopting the “preliminary review system” so that firms can check the possibility in advance to enjoy benefits from the FTA before export and import. Moreover, it is now mandatory to disclose information related to customs and enquiries. So, companies using the FTA are expected to have easier access to information.