Free Trade Agreement Korea Uk

The Free Trade Agreement Between Korea and UK: What You Need to Know

On 10 August 2020, the Republic of Korea and United Kingdom announced the signing of a Free Trade Agreement (FTA) that would replace the existing EU-Korea FTA after the UK`s exit from the European Union. The agreement aims to provide a stable legal framework for trade between the two countries and strengthen their economic relations. In this article, we will look at the key aspects of the FTA and its potential impact on businesses and consumers.

Background

The EU-Korea FTA came into effect in July 2011, and since then, the trade between Korea and the EU has increased significantly. However, with the UK`s withdrawal from the EU, the EU-Korea FTA would cease to apply to the UK. The new Korea-UK FTA guarantees the continuity of trade between the two countries and ensures that products and services will be traded on the same terms as under the EU-Korea FTA.

Key provisions

The FTA covers a wide range of sectors, including goods, services, investment, intellectual property, and e-commerce. Under the agreement, both parties have agreed to eliminate or reduce tariffs on goods traded between them. For instance, Korean tariffs on UK automotive exports will be phased out over three years, while UK tariffs on Korean cars will be eliminated immediately. The FTA also covers the protection of intellectual property rights, including patents, trademarks, and copyrights.

In the services sector, the FTA enables service providers from both countries to access each other`s markets and provide services on a non-discriminatory basis. The agreement also includes provisions on investment protection, including fair and equitable treatment, protection against expropriation, and the right to transfer funds.

In the e-commerce sector, the FTA provides for the protection of personal data and the prevention of spam. It also facilitates the cross-border flow of data, which is essential for the digital economy.

Impact on businesses and consumers

The Korea-UK FTA is expected to benefit businesses in both countries by reducing trade barriers and creating new opportunities for trade and investment. It is estimated that the agreement will increase UK exports to Korea by £2 billion ($2.6 billion) and Korean exports to the UK by £1.36 billion ($1.8 billion) over the long term.

For consumers, the FTA is likely to result in lower prices and greater choice of goods and services. The elimination of tariffs on Korean cars, for instance, could lead to lower prices for UK consumers who purchase Korean-made vehicles. The agreement could also lead to increased competition, which generally benefits consumers.

Conclusion

The Korea-UK FTA is a significant milestone for both countries as they seek to strengthen their economic ties. The agreement is expected to create new opportunities for trade and investment and benefit businesses and consumers in both countries. While the FTA has yet to be ratified by both parties, it is an essential step toward further economic cooperation between the Republic of Korea and the United Kingdom.

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