The Free Trade Agreement covers all major areas of trade relations including trade in goods, trade in services, government procurement, competition and intellectual property. A Joint Committee is established for the supervision of the Agreement, and a chapter provides for dispute settlement procedures. Moreover, the EFTA States and Korea concluded bilateral agreements on basic agricultural products. An agreement on investment has been concluded between Korea, on the one hand, and Iceland, Liechtenstein and Switzerland, on the other, as well.
The Agreement consists of ten Chapters, 88 Articles, 13 Annexes and one Record of Understanding. The Agreement covers the following main issues:
- Trade in Goods
- Rules of Origin
- Sanitary and Phytosanitary Measures (SPS)
- Technical Barriers to Trade (TBT)
- Trade Remedies
- Trade in Services
- Protection of Intellectual Property (IPR)
- Government Procurement
- Institutional Provisions
- Dispute Settlement
- Investment Agreement
Trade in Goods
Industrial Goods and Fish and Marine Products
Most industrial goods, including fish and other marine products, will benefit from duty-free access to the respective markets as of the entry into force of the Agreement. For some products imported into Korea, customs duties are to be eliminated after a transitional period or after a joint review by the Parties (Annex V and Annex VI).
Trade in processed agricultural products are covered in Annex IV to the main Agreement. In addition, trade in basic agricultural products is covered in three bilateral agreements on basic agricultural products negotiated between the respective EFTA State and Korea. These agreements form part of the instruments establishing the free trade area. They provide for concessions on both sides.
Rules of Origin
The Agreement provides for liberal rules of origin and allows for the use of up to 60 per cent of non-originating input in the production of certain products (Annex I).
Sanitary and Phytosanitary Measures (SPS)
The Agreement contains a provision on sanitary and phytosanitary measures referring to the relevant WTO Agreement.
Technical Barriers to Trade (TBT)
The Agreement contains provisions on technical regulations, referring to the relevant WTO Agreement and providing for strengthened cooperation, exchange of information and consultations.
The Agreement contains provisions on trade remedies referring to the relevant WTO rules and provides for additional disciplines on such measures including enhanced notifications and consultations.
Trade in Services
Trade in services is covered in a general chapter (Chapter III, Articles 3.1 to 3.20) and in Annexes on specific commitments (Annex VII), most-favoured-nation (MFN) exemptions (Annex VIII), mutual recognition (Annex IX), telecommunication services (Annex X), and co-production of a broadcasting programmes (Annex XI). The Agreement covers all four modes of delivery (supply) of a service, as defined under GATS, and addresses all services sectors.
As in the GATS, the positive lists of specific commitments of each Party are an integral part of the Agreement. These lists will be reviewed every two years, with the objective of further liberalisation of trade in services between the Parties.
Trade in financial services is dealt with in a special chapter (Chapter IV, Articles 4.1 to 4.21) that also establishes a Sub-Committee on Financial Services.
Protection of Intellectual Property (IPR)
The Agreement sets a high standard for the protection of intellectual property rights (Articles 7.1 to 7.3 and Annex XIII), covering areas such as patents, trademarks and copyright, and goes, in certain areas, beyond what is provided for under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and other international conventions and treaties.
In the Chapter on government procurement (Article 6.1 to 6.3 and Annex XII), the Parties recognise that the WTO Agreement on Government Procurement (WTO GPA) governs the rights and obligations of the Parties. The Chapter also ensures that the Parties can have an “early harvest” of the outcome of the negotiations between the Parties in the context of the negotiations aiming at amending the WTO GPA.
The Chapter on competition (Article 5.1) deals mainly with the co-operation, notification, consultation and exchange of non-confidential information between the Parties. In particular, consultations are provided for when important interests of Korea or an EFTA Member State may be adversely affected.
The Agreement establishes a Joint Committee (Article 8.1), which supervises and administers the Agreement and oversees the further elaboration of the Agreement. Information exchanges and consultations can take place in the Joint Committee. The Joint Committee also takes decisions in cases provided for by the Agreement or makes recommendations.
A Chapter on dispute settlement (Articles 9.1 to 9.11) contains rules and procedures for the avoidance or settlement of disputes arising from the Agreement between one or several EFTA States and Korea.
An agreement on investment (Investment Agreement) was separately concluded between Korea, on the one hand, and Iceland, Liechtenstein and Switzerland, on the other. This agreement covers both access to markets and the protection of investments. The three EFTA States and Korea grant each other national treatment for the establishment of investors, except for a few cases where the Parties have lodged reservations based on restrictions in their national legislation. The agreement also foresees the possibility of direct dispute settlement between an investor and the Party of his investment.
Annexes, Record of Understanding, Joint Declarations and Final Act
|Trade in Goods||Annex I||Rules of Origin and Customs Procedures||Explanatory Notes|
|Appendix 1||Introductory Notes|
|Appendix 2||List Rules|
|Appendix 3||Origin Declaration|
|Appendix 4||Exemptions from the Principle of Territoriality|
|Annex II||Territorial Application|
|Annex III||Excluded Products|
|Annex IV||Processed Agricultural Products||Table I|
|Annex V||Fish and Other Marine Products|
|Annex VI||Customs Duties||Appendix|
|Trade in Services||Annex VII||Schedules of Specific Commitments||Appendix 1||Korea|
|Annex VIII||List of MFN-Exemptions|
|Annex IX||Mutual Recognition|
|Annex X||Telecommunications Services|
|Annex XI||Co-production of Broadcasting Programmes|
|Government Procurement||Annex XII||Contact Points Regarding Government Procurement|
|IPR||Annex XIII||Intellectual Property Rights|
|Other||Record of Understanding|
|Joint Declaration - Customs|
|Declaration by Korea and Switzerland on Medical Devices|
|Decision||Subject||Adopted||Entry into force|
|No. 1/2020||Amendment to Annex I to the Agreement on Rules of Origin and Customs Procedures||5.06.2020|
|No. 2/2015||Amendment to Annex I to the Agreement on Rules of Origin and Customs Procedures||1.05.2015||01.01.2017|
|No. 1/2015||Amendment to Annex I to the Agreement on Rules of Origin and Customs Procedures||1.05.2015||01.05.2015|
|No. 1/2012||Amendment to Annex I to the Agreement on Rules of Origin and Customs Procedures||14.03.2012||01.12.2017|
|No. 1/2010||Amendment to Annex I to the Agreement on Rules of Origin and Customs Procedures||21.01.2010||01.01.2012|
|No. 6/2009||Annex VI||21.04.2009||01.11.2010|
|No. 5/2009||Annex V||21.04.2009||01.01.2011|
|No. 4/2009||Annex IV||21.04.2009||01.01.2011|
|No. 3/2009||Annex III||21.04.2009||01.01.2011|
|No. 2/2009||Annex I||21.04.2009||01.11.2010|
|No. 1/2009||Model Rules of Procedure for arbitration||21.04.2009||21.04.2009|
|No. 1/2008||Rules of Procedure of the Joint Committee||28.05.2008||28.05.2008|
For EFTA-Korea trade statistics, see EFTA Trade Statistics Tool