G/STR/N/17/KOR  
 
9 July 2018  
(18-4302) Page: 1/9 
Working Party on State Trading Enterprises  Original: English  
 
 
STATE TRADING  
NEW AND FULL NOTIFIC ATION PURSUANT TO AR TICLE XVII:4(A) OF THE  
GATT 1994 AND PARA GRAPH 1 OF THE UNDER STANDING ON  
THE INTERPRETATION O F ARTICLE XVII  
REPUBLIC OF KOREA 
The following communication, dated 2 July 2018, is being circulated at the request of the 
Delegation of the Republic of Korea . 
 
_______________  
 
 
Pursuant to Article XVII:4(a) of GATT 1994 and Paragraph 1 of the Understanding on the 
Interpretation of Article XVII, the Republic of Korea makes the following full and new notificatio n of 
its state trading enterprises for 201 6 and 201 7(G/STR/N/ 17). 
 
 
 
TABLE OF CONTENTS  
 
 
Page 
 
1   MINISTRY OF AGRICULTURE, F OOD AND RURAL AFFAIR S, MAFRA  .............................  2 
2   THE KOREA AGRO -FISHERIES & FOOD TRA DE CORPORATION ( aT) .............................  3 
 
 G/STR/N/17/KOR  
 
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  1  MINISTRY OF AGRICULTURE, F OOD AND RURAL AFFAIR S, MAFRA  
1. Description of Products Affected  
 
Products  HS number  Products  HS number  
Rice 1006.10.0000  
1006.20.1000  
1006.20.2000  
1006.30.1000  
1006.30.2000  
1006.40.0000  
1102.90.2000  
1103.19.3000  Rice 1103.20.2000  
1104.19.1000  
1806.90.2290  
1806.90.2999  
1901.20.1000  
1901.20.9000  
1901.90.9091  
1901.90.9099  
 
2. Reason and Purpose  
 
A. Reason or purpose for establishing and/or maintaining state trading enterprise  
 
The MAFRA  has exclusive rights to the importation of  rice in order to avoid domestic market 
disturbances caused by a sudden influx of imported rice and to ensure a smooth implementation of 
the Uruguay Round commitments.  
 
B. Summary of legal basis for granting the relevant exclusive or special rights or privileges, 
including legal provisions and summary of statutory or constitutional powers  
 
Legal provision:  Articles 12 and 13 of the Grain Management Act.  
 
3. Description of th e Functioning of the State Trading Enterprise  
 
A. Summary statement providing overview of operations of state trading  
 
Imports are conducted within the limit of quotas on rice as established in Korea's Country 
Schedule (C/S) . 
 
B. Specification of exclusive  or special rights or privileges enjoyed by the state trading 
enterprise  
 
The M AFRA  has the exclusive rights to the importation of  rice as established in Korea's C/S in 
accordance with the Grain Management Act.  
 
C. Type of entities other than the state tra ding enterprise that are allowed to engage in 
importation/exportation and conditions for participation  
 
Not applicable . 
 
D. How import/export levels are established by the state trading enterprise  
 
Import in accordance with the tariff quotas set in Korea's  C/S. 
 
E. How export prices are determined  
 
Not applicable . 
 G/STR/N/17/KOR  
 
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  F. How the resale prices of imported products are determined  
 
The domestic sales prices of rice for household use  are determined by open auction.  
 
The domestic sales prices of rice for processin g are determined by the M AFRA based on import 
prices, management costs, domestic consumer prices, consumer preference and the level of 
demand of processing companies .  
 
G. Whether long -term contracts are negotiated by the state trading enterprise or whether  the 
state trading enterprise is used to  fulfill contractual obligations entered into by the 
government  
 
Long-term contracts are not considered, and equal opportunities are provided to all parties 
interested in rice export.  
 
H. Brief description of market structure  
 
Farmers enter into government purchases for public stockholding or sell their crops at their liberty 
in private markets.   
 
4. Statistical Information (see attached Tables I -III) 
 
A. Table I:  Statistical Information, Imports.   
 
B. Table II:  Statistical Information, Exports.   
 
Not applicable.   
 
C. Table III:  Statistical Information, Domestic Activities.  
 
5. Reason why no foreign trade has taken place  
 
Not applicable.   
 
6. Additional Information  
 
Not applicable.   
 
2  THE KOREA AGRO -FISHERIES  & FOOD TRADE CORPORATION ( aT) 
1. Description of Products Affected  
 
Products  HS Number  Products  HS Number  
Genus Capsicum  0904.21.0000  Soya beans  1201.90.3000  
1201.90.9000  
Garlic  0703.20.9000  
0712.90.1000  Green beans  
Small red beans  0713.31.9000  
0713.32.9000  
Onions  0703.10.1000  
0712.20.0000  Buckwheat  1008.10.0000  
Sesam um seeds  1207.40.0000    
 G/STR/N/17/KOR  
 
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  2. Reason and Purpose  
 
A. Reason or purpose for establishing and/or maintaining state trading enterprise  
 
The aT was established in 1967 under the Agro -Fisheries Marketing Corporation Act to stabilize the 
domestic market prices of agricultural and fishery products, promote exports, administer imports, 
improve marketing and foster the food industry.   
 
The aT is desig nated as an import agency to administer tariff quotas on relevant items (small red 
beans, buckwheat, etc.) in order to stabilize the domestic market and to ensure the smooth 
implementation of the UR commitments.   
 
B. Summary of legal basis for granting the  relevant exclusive or special rights or privileges, 
including legal provisions and summary of statutory or constitutional powers  
 
Legal provision:  Article 15  and 16 of the Agro -Fisheries Marketing and Price Stabilization Act/  
Articles 12, 13  and 13-2 of t he Grain Management Act.   
 
3. Description of the Functioning of the State Trading Enterprise  
 
A. Summary statement providing overview of operations of state trading  
 
The aT imports tariff quota quantity specified in Korea's C/S.   
 
B. Specification of exclusive or special rights or privileges enjoyed by the state trading 
enterprise  
 
Imports & sales of items subject to in-quota  tariffs.   
 
C. Type of entities other than the state trading enterprise that are allowed to engage in 
importation/exportation and  conditions for participation  
 
For sesam um seeds , buckwheat, onion,  garlic, green beans, small red beans and soya beans,  
private companies are allowed to import part of the quotas through open bidding.  Open bidding 
refers to a "public auction" where goods are sold to a participati ng company which  offers the 
highest price during the auction . For genus capsicum, green beans , and small red beans, part of 
tariff quota quantity is allocated to private companies on a first -come, first -served basis.  
 
D. How import /export levels are established by the state trading enterprise  
 
Imports are carried out by an annual quota quantity as set in Korea's C/S, and certain items (small 
red beans, soy a beans , sesam um seeds, etc.) are imported by more than the specified quantity in 
Korea's C/S, depending on the changes in domestic supply and demand.   
 
E. How export prices are determined  
 
Not applicable . 
 
F. How the resale prices of imported products are determined  
 
The resale prices of imported products are determined at the op en auction, at a level above 70% 
of the wholesale prices, depending on their quality.   
 
G. Whether long -term contracts are negotiated by the state trading enterprise or whether the 
state trading e nterprise is used to fulfill contractual obligations entered into by the 
government  
 
Long-term contracts are not considered, and equal opportunities are granted to all countries 
concerned.  
 G/STR/N/17/KOR  
 
- 5 - 
 
  H. Brief description of market structure  
 
Farmers generally sell c rops at their will in private markets.   
 
The products imported by the aT are either sold directly by the aT or through an open bidding or a 
wholesale auction system.   
 
4. Statistical Information (see attached Tables I -III) 
 
A. Table I:  Statistical Informat ion, Imports.   
 
B. Table II:  Statistical Information, Exports.   
 
Not applicable.   
 
C. Table III:  Statistical Information, Domestic Activities.  
 
5. Reason why no foreign trade has taken place  
 
Not applicable.   
 
6. Additional Information  
 
Not applicable.   
  G/STR/N/17/KOR  
 
- 6 - TABLE I  
STATE TRADING: MINISTRY OF AGRICULTURE, FOOD  AND RURAL AFFAIRS  
STATISTICAL INFORMATION, IMPORTS  
(unit:  mt, US$, US$/mt)  
Description of product(s)  
(including HS number(s))  Total quantity 
imported  Quantity imported 
by state trading 
enterprises  Average import 
price  
(US$/mt)  Average 
representative 
domestic sales price  
(US$/mt)  Mark -up 
(US$/mt)  National 
production  
1 2 3 4 5 6 7 
Rice 
(1006.20.1000)  '16: 353,700  
'17: 368,700  '16: 353,700  
'17: 368,700  '16: 737.5  
'17: 727.6  '16: 460.4  
'17: 472.5  '16: 0 
'17: 0 
'16: 4,196,691  
'17: 3,972,468  Rice 
(1006.30.1000)  '16: 50,000  
'17: 40,000  '16: 50,00 0 
'17: 40,000  '16: 674.2  
'17: 801.5  '16: 1,100 
'17: 1,059  '16: 425.8  
'17: 257.5  
Rice 
(1006. 40.0000) '16: 5,000  
'17: 0 '16: 5,000  
'17: 0 '16: 383.5  
'17: - '16: 217.6  
'17: - '16: 0 
'17: - 
N.B. 
 Rice: Polished rice basis . 
 Annual average of exchange rate:  '16: W 1, 160.50 /$, '17: W 1,130.84 /$. 
 
 
   
  G/STR/N/17/KOR  
 
- 7 - TABLE III  
 
STATE TRADING: MINIS TRY OF AGRICULTURE, FOOD  AND RURAL AFFAIRS  
STATISTICAL INFORMATION, DOMESTIC ACTIVITIES  
(unit:  mt) 
Description of product(s)  
(including HS number(s))  Domestic purchase by state 
trading enterprises  National production  Domestic sales by state 
trading enterprise  National consumption  
1 2 3 4 5 
Rice 
(1006.20.1000)  
(1006. 30.1000)  
(1006. 40.0000) '16:  0 
'17:  0  '16: 4,196,691  
'17: 3,972,468  '16: 29,131  
'17: 54,142  '16: 4,220,446  
'17: 4,476,742  
N.B. 
 Rice: Polished rice basis. 
   
  G/STR/N/17/KOR  
 
- 8 - TABLE I  
 
STATE TRADING: KOREA AGRO -FISHERIES  & FOOD TRADE CORPORATI ON(AT)   
STATISTICAL INFORMATION, IMPORTS (unit: mt, US$, US$/mt)  
Description of 
product(s)  
(including HS 
number(s))  Total quantity 
imported  Quantity imported 
by state trading 
enterprise  Average import price  
(US$/mt)  Average 
representative 
domestic sales 
price (US$/mt)  Mark up  
(US$/mt)  National production  
1 2 3 4 5 6 7 
1. Soya beans  
(1201. 90.3000) 
(1201. 90.9000) '16: 283,962  
'17: 252,083  '16: 226,427  
'17: 222,314  '16: 649 
'17: 649 '16: 915 
'17: 981 '16: 266 
'17: 332 '16: 90,719  
'17: 85,644  
2. Small red beans  
(0713.32.9000)  '16: 22,351  
'17: 23,974  '16: 19,384  
'17: 20,294  '16: 1,833  
'17: 1,346  '16: 1,982  
'17: 2,034  '14: 149 
'15: 688 '16: 4,028  
'17:  n/a 
3. Green beans  
(0713.31.9000)  '16: 6,025  
'17: 6,405  '16: 3,500  
'17: 3,500  '16: 1,799  
'17: 1,670  '16: 4,140  
'17: 4,570  '16: 2,341  
'17: 2,900  '16: 1,869  
'17: n/a 
4. Buckwheat  
(1008.10.0000)  '16: 1,929  
'17: 2,009  '16: 828 
'17: 828 '16: 823 
'17: 666 '14: 1,965  
'15: 1,937  '16: 1,142  
'17: 1,271  '16: 1,892  
'17: n/a 
5. Genus Capsicum  
(0904.2 1.0000) '16: 2,691  
'17: 2,312  '16: 0 
'17: 0 '16: - 
'17: - '16: - 
'17: - '16: - 
'17: - '16: 85,459  
'17: 55,714  
6. Garlic  
(0703.20.9000)  
(0712.90.1000)  '16: 33,782  
'17: 3,351  '16: 15,900  
'17: 20 '16: 3,929  
'17: 6,978  '16: 3,378  
'17: 3,117  '16: 0 
'17: 0 '16: 275,549  
'17: 303,578  
7. Onions  
(0703.10.1000)  
(0712.20.0000)  '16: 46,987  
'17:150,094  '16: 0 
'17: 11,580  '16: - 
'17: 828  '16: - 
'17: 552 '16: - 
'17: 0 '16: 1,298,749  
'17: 1,144,493  
8. Sesamum seeds  
(1207.40.0000)  '16: 77,906  
'17: 74,993  '16: 35,582  
'17: 35,499  '16: 1,752  
'17: 1,752  '16: 3,269  
'17: 3,167  '16: 1,517  
'17: 1,415  '16: 13,575  
'17: 14,258  
N.B. 
 Annual average of exchange rate:  '16: W 1,160.50 /$, '17: W 1,130.84 /$. 
 Genus Capsicum, Onions : No state trading import in 2016  (Genus Capsicum, Onions) and 2017  (Genus Capsicum) because the import rights auction system was used.  
 National production of small red beans, green beans and buckwheat in 2017 is not available.  
   
  G/STR/N/17/KOR  
 
- 9 - TABLE III  
 
STATE TRADING: KOREA AGRO -FISHERIES  & FOOD TRADE CORPORATI ON(AT)  
STATISTICAL INFORMAT ION, DOMESTIC ACTIVI TIES 
(unit: mt)  
Description of product(s)  
(including HS number(s))  Domestic purchases by state 
trading enterprise  National  
Production  Domestic sales by state 
trading enterprise  National consumption  
1 2 3 4 5 
1. Soya beans  
(1201. 90.3000) 
(1201. 90.9000) '16: 3,200  
'17: 11,694  '16: 75,448  
'17: 85,644  '16: 252,852 
'17: 228,316  '16: 399,000 
'17: 362,000  
2. Small red beans  
(0713.32.9000)  '16: 0 
'17: 0.5  '16: 4,028  
'17: n/a '16: 18,503  
'17: 19,285 '16: 25,500  
'17: 27,600 
3. Green beans  
(0713.31.9000)  '16: 0 
'17: 0  '16: 1,869  
'17: n/a  '16: 4,185 
'17: 3,306  '16: 8,600  
'17: 7,800  
4. Buck wheat  
(1008.10.0000)  '16: 101 
'17: 274  '16: 1,892  
'17: n/a  '16: 1,076 
'17: 925 '16: 3,300  
'17: 3,300  
5. Genus Capsicum  
(0904.2 1.0000) '16: 1,942  
'17: 32 '16: 85,459  
'17: 55,714 '16: 292 
'17: 9,615  '16: 172,500 
'17: 206,000  
6. Garlic  
(0703.20.9000)  
(0712.90.1000)  '16 0 
'17: 2,000  : 275,549  
'17: 303,578  '16 10,163  
'17: 12,476  '16: 386,000  
'17: 382,000  
7. Onions  
(0703.10.1000)  
(0712.20.0000)  '16: 10,327  
'17: 2,000  '16: 1,298,749  
'17: 1,144,493  '16: 22,900  
'17: 6,072  '16: 1,394,000  
'17: 1,331,000  
8. Sesamum seeds  
(1207.40.0000)  '16: 0 
'17: 0  '16: 13,575  
'17: 14,258  '16: 0 
'17: 0 '16: 91,480 
'17: 89,251  
N.B. 
 
 Annual average of exchange rate:  '16: W 1,160.50 /$, '17: W 1,130.84 /$. 
 National production of small red beans, green beans and buckwheat in 2017 is not available.  
 
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