The current law defines export record as the major occupancy requirements, but  as this definition limits exports to “shipping domestic goods to a foreign country” under Article 2-2 of the Customs Act, so it has been pointed out that suppliers of materials and equipment to finished export goods may be interpreted as ineligible for occupancy in the free trade zone.

In addition, under the current law, there is an indication that if products other than for export among those manufactured and processed from raw materials of agro-livestock products flow into the domestic market, domestic farms and related industries could be damaged.

Accordingly, the Act aims to specify that suppliers of raw materials and equipment for finished export goods to earn foreign  currency are eligible for occupancy in the free trade zones, and to make occupancy in the free trade zones conditional upon shipping raw materials and products entirely out of the country for the enterprises that manufacture and process the raw material of agro-livestock products that are permitted at a rate equivalent to the domestic and foreign price differences under the provisions of the Customs Act, etc., protecting domestic farms and related industries, while at the same time contributing to increasing exports of highly value-added agro-livestock markets, thereby seeking to revitalize the free trade zones by adding and aligning related provisions.

Details

A. Include in the list for occupant enterprises (Article 10) suppliers of raw materials and equipment for finished export goods to earn foreign currency 

B. Designate as the types of business that are ineligible for occupancy those producing goods using as raw materials agro-livestock products that are permitted at a rate equivalent to the domestic and foreign price differences under the Customs Act, and where the goods in question  are shipped entirely out of the country, allow the occupant enterprise status, but organize a systematic goods management system including inventory control computer system, employment of bonded warehouse manager, etc. (Newly inserted Article 10-2 )

C. Ensure organization of a systematic goods management system including inventory control computer system, employment of bonded warehouse manager, etc.(Article 11) for the type of business using agro-livestock products as raw materials other than the type of business that is restricted for occupancy using as raw materials agro-livestock products that are permitted at a rate equivalent to the domestic and foreign price differences under the Customs Act. (Article 11)

D. Have the occupant enterprise report to the head of the customs office in case it intends to use or consume the foreign goods carried into the free trade zone. (Article 29-2, newly established )

E. In case raw materials and products carried in on the condition to ship the entire amount out of the country is carried from the free trade zone out to the customs area, add a case where goods are used without reporting of use or consumption of foreign products brought into a free trade zone. (Article 40-2)

F. Add as a reason of punishment and penalty a case of carrying from the free trade zone to the customs territory raw materials and products that were carried in conditional upon shipping them entirely out of the country or using foreign products brought into a free trade zone without reporting of use or consumption. (Articles 57 and 60 through 70)

Type of business that is restricted from occupancy ( Article 10-2), occupancy contract (Article 11), carrying in or importing goods (Article 29), reporting the use and consumption (Article 29-2), work outside Free Trade Zone (Article 34), shipping out the goods (Article 37), suspension of carrying in (Article 40-2)