Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Customs agency to crack down on country-of-origin fraud in US exports
A senior Korea Customs Service (KCS) official speaks on the crackdown on deceptive labeling of foreign goods as made in Korea for exports to the United States during a press briefing at a KCS branch office in Seoul, Monday. Courtesy of KCS
By Yi Whan-woo
Korea will carry out a sweeping crackdown on foreign goods that are deceptively labeled as Korean-made before export to the United States in a bid to lessen the tariff burden imposed by the U.S. government, the Korea Customs Service (KCS) said Monday.
The customs agency said the crackdown will center on goods from countries where the U.S. levies higher rates of import duties than Korea, such as China, in light of U.S. President Donald Trump’s widening tariff war.
The KCS has so far seized 28.5 billion won ($20 million) worth of goods this year that were shipped from overseas and disguised as being manufactured in Korea before attempts to export them to the U.S.
That amount already surpasses the total amount of goods confiscated throughout all of 2024 due to fraudulent origin labeling. Last year, the total value was 21.7 billion won.
“It can seriously damage Korean exporters’ credibility in the U.S. and even result in toughened regulations against our products if foreign goods are falsely labeled as ‘Made in Korea’ to bypass the U.S. tariff policy for illicit gains,” KCS Commissioner Ko Kwang-hyo said. “We therefore will take corresponding measures to protect our firms and industries.”
The KCS said it launched a special investigation unit at its headquarters in Daejeon to thoroughly monitor transshipment of goods from overseas and their country of origin when exported to the U.S.
The unit will oversee a total of eight teams at customs checkpoints across the country.
The KCS will also enhance information sharing and other collaborative efforts with Seoul’s National Intelligence Service along with Washington’s Homeland Security Investigations and the Customs and Border Protection.
While forging countries of origin for foreign goods has happened before in Korea, it was mainly for marketing purposes, exploiting Korean products’ reputation in the U.S., according to the KCS.
It said that foreign goods have increasingly been falsely labeled in recent months due to shifts in U.S. trade policy, which vary considerably by country in terms of antidumping duties, reciprocal duties and other forms of import taxes.
Trump has been threatening major U.S. trading partners with tariff hikes, as he promised in his presidential election campaign.
The top target has been China, whose goods are currently levied with baseline tariffs of 145 percent.
In comparison, the U.S. reciprocal tariffs on Korean goods are set at 25 percent. Moreover, the Trump administration declared a 90 day tariff pause on Korea and other trading partners, with the notable exception of China.
The KCS caught a Chinese mattress company falsifying certificates of origin and other documents needed for exports to the U.S. last November.
In January, a company established in Korea by a Chinese national was caught illegally exporting Chinese-made cathode materials for secondary batteries to the U.S. and other countries, declaring them to be Korean-made products.