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KORUS FTA Faces Renegotiation

July 2011 - Tax & Private Client. Legal Developments by Hassans.

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During a meeting with South Korea?s President Lee Myung-bak, the parliamentary opposition leader, Sohn Hak-kyu, has insisted that the text of the South Korea-United States free trade agreement (KORUS FTA) should be renegotiated.

Originally signed in 2007, protracted negotiations last December had permitted both sides to declare that they had successfully resolved all of the outstanding issues surrounding the KORUS FTA, particularly with regard to concerns then being expressed by the US motor industry.

The South Korean government presented a ratification bill to parliament, but then had to withdraw it at the end of April this year for translation corrections to be made. It had still hoped, however, to obtain approval for the agreement this month.

The government had expected that a parliamentary majority would be difficult for the KORUS FTA, largely due to the belief of opposition parties that the supplementary auto agreement now favours the US industry, but the categorical position expressed by Sohn has caused concern.

Sohn is of the view that the trade agreement is now too favourable to the US, and needs to be re-balanced through further negotiation. It is reported that President Lee?s reaction is that such a position is tantamount to outright opposition to the KORUS FTA, in any shape or form.

 


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