The government will ease the tariff burden on corporations whose freight expense has increased as they detoured the Strait of Hormuz due to the Middle East war. Because tariffs are levied not only on the price of imported goods but also on the value that includes freight, corporations that sailed longer routes or urgently used substitute aircraft face higher tariffs. The government said the reduced burden for these corporations is estimated at 112.3 billion won based on import declarations in April and May.
The Korea Customs Service and other related ministries held the task force (TF) on special management of essential consumer prices on the 7th and released the "inspection and improvement plan for customs clearance of items affected by the Middle East war."
The government plans to support easier inflows of non-Middle Eastern crude. In March–April after the Middle East war began, the share of Middle Eastern crude imports fell by 8.5 percentage points from a year earlier, and non-Middle Eastern crude from Ecuador, Congo, Australia and Malaysia is filling the gap.
Recently, the Korea Customs Service released a joint statement with the Alberta State Governments addressing the origin verification issue that had hindered applying the free trade agreement (FTA) preferential rate (3→0%) to imports of Alberta crude from Canada.
In addition, this time it will push to shorten the issuance period for certificates of origin for Malaysian crude. If there is no certificate of origin at the time of import declaration, the importer must pay tariffs at the general rate without FTA benefits to clear customs, which is a burden. In particular, the average time to issue a Malaysian certificate of origin is 184 days, which is much longer than Australia (57 days) and the Philippines (3 days).
In addition, the government decided to review measures to support imports of Australian condensate, which can be used as a substitute feedstock for naphtha but has limited import volumes. It will also improve unloading procedures for crude oil and liquefied natural gas (LNG) carriers until the Middle East war ends, and for crude oil imports, it will not impose fines even if quantities not in the original plan are additionally discharged.