The regional value-added standard for South Korean automobiles to receive tariff benefits under the free trade agreement (FTA) with the United Kingdom will be relaxed from 55% to 25%. The online gaming market will also be opened, and the supply chain cooperation channels between the two countries will transition to a permanent system based on the agreement.
The Ministry of Trade, Industry and Energy announced on August 31 that it will release the draft of the English and Korean versions of the revised Korea-UK FTA, which was concluded last December, on the government FTA website from September 1 to 11, and will collect public opinions.
This move aims to enhance the transparency of the trade agreement process and ensure the reliability of the Korean translation. The ministry plans to finalize the Korean version after reviewing the submitted opinions with relevant departments and experts.
The revised agreement features amendments to 10 chapters and annexes, including tariffs and services, from the existing 27 chapters and annexes, and introduces 13 new chapters and annexes covering supply chains, gender equality, and anti-corruption. In the goods sector, regulations related to export and import permits will be strengthened, and provisions to facilitate trade in remanufactured and repaired products will be introduced. A systematic channel for consultation between the two countries will also be established to address supply chain crises, such as export controls on raw materials.
The origin criteria have also been relaxed. For automobiles, the regional value-added standard will be lowered from 55% to 25%. For pharmaceuticals, cosmetics, and plastics, the existing standards of 50-75% will be eased to 40%. Batteries will be eligible for duty-free benefits even if they use components produced outside the region, provided certain conditions are met. However, the current origin criteria for fresh agricultural and fishery products will be maintained due to the sensitivity of the domestic industry.
In the services sector, the UK will include audiovisual services in the agreement for the first time in a bilateral FTA and will open the online gaming service market. This is expected to expand the opportunities for domestic gaming companies to enter the UK market.
A new investment chapter reflecting both investor protection and the government's public regulatory authority has also been established. The two countries have tentatively agreed to terminate the Korea-UK Investment Guarantee Agreement signed in 1976.
After finalizing the Korean version, the Ministry of Trade, Industry and Energy plans to review it with the Ministry of Foreign Affairs and the Legislation Office, and consult with the UK side before formally signing the agreement. Subsequently, it will submit a ratification proposal to the National Assembly in accordance with relevant laws.
* This article has been translated by AI.
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