South Korea - US Orange FTA quota change

US oranges coming into Korea from September 1- February 28 do so under a Tariff Rate Quota (TRQ) negotiated under the Korea-US Free Trade Agreement (KORUS).

The system for allocating these quota will change in Year 11 (2022) from an import license auction system to an import license allocation system. The Ministry of Agriculture, Food, and Rural Affairs (MAFRA) recently clarified how this import license allocation system will be implemented.

US oranges are eligible to be shipped to Korea year-round. From September 1- February 28, US oranges come in under the Korea-US Free Trade Agreement Tariff Rate Quota. Oranges that come in within the quota are duty-free, while the out-of-quota rate is 50 percent. From March 1- August 31, US oranges come in duty-free under a zero percent seasonal duty (since 2018).

The March- August timeframe is considered the regular FTA tariff timeframe. Although the orange TRQ under the KORUS FTA is a small quantity relative to the annual orange imports from the United States, the in-quota quantity increases by three percent every year, compounded annually. The KORUS FTA TRQ also provides a meaningful benefit for importers, as it opens a duty-free quantity outside the regular FTA seasonal duty-free period.

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