The Trump Administration has opened talks with South Korean Government officials to renegotiate the terms of the U.S. - Korea Free Trade Agreement (KORUS). The U.S. has indicated that there is a growing trade deficit with South Korea and that unless this problem is addressed quickly the U.S. may move to terminate the free trade agreement between the two countries.
KORUS came into force in 2012 and since that time trade between the two countries has increased significantly and the trade deficit has increased as well. South Korea is currently the U.S. sixth-largest trading partner with total trade (2016) of over $144 billion USD. The U.S. exported just over $60 billion in goods and service to South Korea and imported just over $80 billion in goods and services.
Under KORUS most goods sourced in South Korea are able to enter the U.S. duty free. As part of the renegotiation process the U.S. may insist on increased tariffs for some goods and that South Korea import a larger volume of U.S. goods.
More information can be found HERE.
As with all free trade agreements, importers are strongly urged to carefully document the eligibility of their imported products for the reduced duty rates as U.S. Customs is closely reviewing imports under the various FTAs to ensure that all claims for reduced duty are valid. A lack of valid documentation can lead to the assessment of duties and penalties against the U.S. importer.
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