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Korea, Britain sign upgraded FTA deal easing rules of origin for Korean cars, consumer goods

Published: 16 Dec. 2025, 08:57 Updated: 16 Dec. 2025, 14:32

Yeo Han-koo, right, trade minister at the Ministry of Trade, Industry and Resources, and Chris Bryant, minister of state at Britain's Department for Business and Trade, pose for a photo in London on Dec. 15 after announcing the conclusion of talks to improve the Korea-Britain free trade agreement. [YONHAP]

Korea and Britain have signed an upgraded FTA aimed at easing rules of origin for Korean automobiles and consumer goods, as well as opening up the latter's high-speed rail and online game markets, Seoul's Ministry of Trade, Industry and Energy said Tuesday.

The deal was jointly signed by Korean Trade Minister Yeo Han-koo and his British counterpart, Chris Bryant, during their bilateral meeting in London, following two-year negotiations between the two countries.

The original FTA between Seoul and London was signed in 2019 and implemented in 2021.

Under the renewed deal, Britain decided to ease rules of origin for automobiles, beauty and food products exported by Korea, according to the Trade Ministry.

Currently, Korean carmakers are eligible for tariff-free treatment only if they prove that at least 55 percent of a vehicle's value, including parts and materials, was generated within Korea.

But the revised agreement will lower the requirement for tariff exemption to 25 percent, making it easier for automakers to qualify for preferential treatment.

Automobiles are one of Korea's key export items to Britain, accounting for 36 percent of Korea's total exports to the European nation last year, according to the ministry.

Korean beauty products, which are subject to 8 percent duties, will be able to get tariff exemptions if manufacturing procedures, such as chemical reactions, purification, mixing and blending, are carried out in the exporting country.

Processed food products exported from Korea, including dumplings, tteokbokki (spicy rice cakes), gimbap (seaweed rice rolls) and kimchi, will receive the preferential treatment even in cases where products were made domestically using major ingredients sourced from third countries. Currently, they can only face zero tariffs when key ingredients originate from Korea.

In the government procurement sector, Britain has agreed to open up its high-speed rail market. Until now, Korea has been the only side to grant access to this market.

In the service sector, the European nation pledged to additionally open up its online game market, an area in which Korean companies show global competitiveness, and markets related to emerging technologies, such as artificial intelligence.

The ministry said the two sides also streamlined their visa system under the upgraded FTA to facilitate the entry of Korean engineers and special workforces responsible for building manufacturing plants in Britain.

The move is aimed at preventing disruptions similar to an incident in the U.S. state of Georgia, where hundreds of Korean nationals were arrested in an immigration raid at a car battery plant in early September and later released.

Meanwhile, the two countries also agreed to adopt regulations for digital trade, including those related to liberalization of cross-border data transfers and online consumer protection.

They also agreed to deepen bilateral cooperation in AI and advanced technologies by setting up the so-called innovation committee, and bolster supply chain collaboration, the ministry said.

"This agreement will help reinforce the free market order amid growing uncertainties in the global trade environment driven by the spread of protectionism and serve as an opportunity to strengthen economic cooperation with Britain, Korea's major partner in Europe," Yeo said in a press release, vowing to swiftly carry out remaining procedures for the official implementation of the trade deal.

Yonhap