USTR Proposes 12.5% 'Section 301 Tariff' on Korea Over Forced Labor Enforcement

Absence of Forced Labor Import Ban Systems Cited

Government Vows “All-Out Response to Safeguard Balance of Interests Under Korea-U.S. Tariff Agreement”

Yonhap News

The Office of the United States Trade Representative (USTR) has proposed imposing an additional 12.5% tariff on Korean products, citing insufficient enforcement of the import ban on goods produced with forced labor. The Korean government plans to actively explain its domestic systems and voluntary efforts by the private sector to eradicate forced labor, aiming to prevent any disruption to the balance of interests established under the Korea-U.S. tariff agreement.

On June 3, the Ministry of Trade, Industry and Energy announced that, on June 2 (local time), the USTR released its Section 301 investigation report on the import ban of goods produced with forced labor, along with proposed tariff rates by economic bloc. Previously, since March 12, the USTR has been investigating the policies and practices related to the import ban on goods produced with forced labor in 60 trading partner economies, including Korea, China, the European Union (EU), Japan, and the United Kingdom.

The USTR has suggested applying a 12.5% tariff rate to 46 economies—including Korea, Japan, China, Australia, New Zealand, Singapore, India, and Vietnam—on the grounds that they have not effectively enforced the import ban on goods produced with forced labor.

For 14 other economies, including Canada, the EU, Mexico, Taiwan, Indonesia, and the United Kingdom, the USTR proposed a 10% tariff rate, considering the existence of forced labor import ban systems or commitments made through trade agreements with the United States.

However, the USTR explained that products subject to Section 232 of the Trade Expansion Act, certain minerals and raw materials, and some aircraft and pharmaceuticals—where domestic production in the United States is insufficient—will be excluded from the additional tariff, but that other items will require the imposition of extra duties.

The USTR will accept written comments from stakeholders until July 6, and will hold a public hearing on July 7.

The Korean government has reiterated its position that this measure is inappropriate. The Ministry of Trade, Industry and Energy explained that since the start of the investigation, it has worked closely with relevant ministries and major industry associations, submitting a statement asserting that Section 301 action is unnecessary based on the country’s institutional efforts and voluntary measures by companies to eradicate forced labor.

Going forward, the government plans to continue actively presenting its position through additional written submissions and participation in public hearings, while also responding in a manner that will maintain the existing balance of interests under the Korea-U.S. tariff agreement, in connection with the ongoing Section 301 investigations into excess production.

In addition, Han Koo Yeo, Minister for Trade, is expected to meet soon with Jamieson Greer, the U.S. Trade Representative, to discuss countermeasures in relation to this announcement.

This content was produced with the assistance of AI translation services.