As part of the Korean government’s latest move to take part in the US export controls against Russia and Belarus, the Ministry of Trade, Industry, and Energy (“MOTIE”) partially amended and issued the Public Notice on Trade of Strategic Items (“Public Notice”) on March 25, 2022, to take effect starting March 26, 2022.
This partial amendment to the Public Notice reflects the addition of 57 categories of goods that are currently not strategic items under Korean law but are items subject to the expanded US export controls targeting Russia imposed by the US Department of Commerce dated February 24, 2022. MOTIE added all 57 categories to Annex 2-2 of the Public Notice, which sets forth items subject to situational license (i.e., license under catch-all controls) under the Notification. The followings are the areas to which the added 57 categories belong.
- Electronics and semiconductor, computers, telecommunications, information security, sensors and lasers, navigation and avionics, marine, and aerospace and propulsion
Accordingly, Korean companies that export, or plan to export, to Russia or Belarus items, software or technology that fall under any of the 57 categories, must obtain a situational license from MOTIE. Although MOTIE has not officially stated its position, it would be prudent to expect that MOTIE will apply extra scrutiny when reviewing whether to grant a license to export these relevant goods to Russia or Belarus. In addition, it is important to note that Korea being newly included in the list of “exempt countries” – as agreed between the Korean government and the US government – will be limited to exemption from the new, Russia/Belarus-specific Foreign Direct Product Rule (“FDPR”) that the US government recently implemented. Therefore, companies should review on a case-by-case basis whether their transactions comply with the existing US Export Administration Regulations (“EAR”), from which Korea is not exempt.
Please find attached an unofficial English translation of the amended Annex 2-2 (Items Subject to Situational License) of the Public Notice (link). In addition, the Korean Security Agency of Trade and Industry (“KOSTI”), an agency tasked with determining whether a certain item is a strategic item, published on its webpage (link, in Korean) the “Guidelines on Application for Export License for 57 Categories.” The guidelines provide detailed information regarding the 57 categories added as being subject to situational license.
As Russia’s military actions in Ukraine have continued, additional multilateral sanctions and export control restrictions are being imposed against Russia. We are closely monitoring and will issue further updates in the event of material developments concerning any additional measures taken by the Korean government.
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