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I사 면세 및 환급 신청
This scenario explores how I Co., a multinational company, navigated Korean Customs regulations while importing chemical raw materials from its European subsidiary for manufacturing Family Care product "ABC".
Duty exemptions are offered by the government through certain specialized programs (NAFTA, GSP, etc.) where specific criteria are met. Importers must be careful to use "reasonable care" in properly assessing eligibility for and in properly documenting a duty exemption.
Introduction & outline
I Co. imports key chemical components from its own subsidiary in Europe, raising concerns about fair pricing due to their relationship.
The imported chemicals are crucial for producing "ABC", which I Co. plans to export.
Customs regulations require accurate valuation and tax compliance, with potential for duty exemptions and refunds under specific conditions.
Challenges
Planning & Analysis
To ensure compliance, I Co. prepared detailed documentation, including a transfer pricing study to justify the import price.
They planned to apply for a customs duty exemption under the Foreign Investment Promotion Act, given the chemicals' role in an export-focused product.
Additionally, I Co. intended to apply for a duty refund for the chemicals used in exported goods, adhering to the Act On Special Cases Concerning The Refund Of Customs Duties.
Documents in need
Transfer Pricing Study, prepared by an independent auditor.
Import Declaration Forms, issued by I Co.'s logistics department.
Invoices and Purchase Orders for the chemical raw materials, issued by the European subsidiary.
Production and Export Records for "ABC", detailing the use of imported chemicals, issued by I Co.'s manufacturing unit.
Application for Customs Duty Exemption, under the Foreign Investment Promotion Act.
Application for Customs Duty Refund, including a detailed report of export activities, issued by I Co.'s finance department.
Compliance Certificates from tax authorities in Europe and Korea, validating I Co.'s tax status.
Take aways
I Co.'s thorough documentation and adherence to Korean Customs policies enabled them to effectively navigate the import process.
The transfer pricing study and additional financial records substantiated the fairness of the import price, satisfying Customs' concerns about the related-party transaction.
By leveraging the Foreign Investment Promotion Act, I Co. successfully obtained a customs duty exemption, reducing the overall cost of importing the chemicals.
Subsequently, I Co. received a customs duty refund for the materials used in exported products, further supporting their export-oriented business model.
This case exemplifies the importance of meticulous planning and comprehensive documentation in ensuring smooth customs processes for multinational corporations.
"We assisted I Co. in their Korean Customs process, ensuring fair pricing and compliance for duty exemptions and refunds for importing chemical materials for "ABC"
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