[FTA HONG] Summary of the RCEP (FTA utilization rate, FTA utilization by industry, and summary of highlights)
RCEP(Regional Comprehensive Economic Partnership) is the world's largest MEGA FTA, and Korea will be able to enjoy additional tariff benefits in addition to the effects of the existing FTA. It is also significant in that it is the first FTA between Korea and Japan.
RCEP is comprised of 10 ASEAN countries, orea, China, Japan, Australia, and New Zealand. The ASEAN is composed of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Vietnam, Thailand. India is not currently a member of RCEP.
The RCEP has now entered into force with 14 countries, excluding Myanmar.
In the case of RCEP, FTA import/export utilization rate was analyzed only for Japan, as RCEP has different FTAs with all 13 countries except Japan.
In practice, RCEP is mostly utilized in Japan. For exports, 97.4% of the utilization is for the top three countries: Japan (67.3%), China (27.7%), and Thailand (2.4%), while for imports, 98.5% of the utilization is for the top three countries: Japan (48.3%), China (38.7%), and Thailand (11.5%).
As of 2022, the utilization rate of imports and exports with Japan is 39.1% for exports and 25.5% for imports. When looking at FTA utilization by industry, electrical and electronic products are the highest at 70.6%, followed by minerals at 10.2% and miscellaneous products at 0%. On the other hand, chemical industrial products are the highest at 34.9% and electrical and electronic products are the lowest at 8.6%.
(Unit: Thousands of dollars)
Category | FTA | total amount | FTA preference eligible exports and imports | Apply actual FTA preferential tariffs | utilization rate(%) |
amount | amount | ||||
Export | RCEP | 30,630,511 | 4,285,327 | 1,673,851 | 39.1 |
Import | 54,707,489 | 10,646,816 | 2,716,275 | 25.5 |
A brief summary of the provisions of the RCEP related to trade in goods is as follows. However, it is intended as a guide only and companies should refer to the Agreement for the exact Agreement-specific interpretation.
Category | Contents | ||
into force date | 2022. 01. 01. (effective Feb. 1, 2022 in South Korea; may vary by country) | ||
Agreement other party | 10 ASEAN countries, China, Japan, Australia, and New Zealand | ||
Certificate of Origin | Issuing Modality C/O | Authority – Issued or Self - Issued | |
Issuer | Authority – Issued | issuing body of the exporting Party | |
Self - Issued | Exporter, Producer, | ||
Government Authorities | RCEP (Government Authority) Korea (Customs and Chamber of Commerce and Industry) | ||
Form of Certificate | Authority – Issued | Uniform Certificate | |
Self - Issued | contain information which meets the minimum information requirements as set out in Annex 3B(Minimum Information Requirements) | ||
Validity Period (yrs) | 1 | ||
Submission Exemption | the customs value of the importation does not exceed US$ 200 or the equivalent amount in the importing Party’s currency or any higher amount as the importing Party may establish | ||
Value- Content Rule | Requirement | RVC(Regional Value Content) | |
Product Price | FOB | ||
Calculation Modality | Build-down Method, Build-up Method | ||
Origin Verification | verification method | Direct or Indirect verification (a written request for additional information to the issuing body or competent authority of the exporting Party – Indirect) (the written request for information, a verification visit - Direct) | |
Replied within | 30 and 90 days from the date of receipt of the written request (intirect) 90 and 180 days(direct) | ||
Replied by | the issuing body or competent authority of the exporting Party | ||
Information about the Government Authorities is as follows:
Country | Government Authorities |
New Zealand | New Zealand Chamber of Commerce, Trade Window Origin Limited |
Laos | Department of Import and Export Ministry of Industry and Commerce |
Vietnam | Ministry of Industry and Trade |
Brunei | Trade Division, Ministry of Finance and Economy |
Singapore | Singapore Customs |
Japan | he Japan Chamber of Commerce and Industry |
China | China Customs, China Council for the Promotion of International Trade |
Cambodia | Ministry of Commerce |
Thailand | Department of Foreign Trade |
Australia | Ozdocs International (Australian Chamber of Commerce and Industry, Australian Industry Group Ozdocs International) / Trade Window Origin Pty Limited |
Korea | Korea Chamber of Commerce and Industry, Korea Customs Service |
Malaysia | Ministry of International Trade and Industry |
Indonesia | Ministry of Trade |
Myanmar | Department of Trade |
Philippines | The Philippine Bureau of Customs |
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