GUIDANCE FOR

THE KOREA ADVANCE MANIFEST SYSTEMTO SECURE AND FACILITATE GLOBAL TRADE

SEP. 2011

KOREA CUSTOMS SERVICE

Contents
1. INTRODUCTION --------------------------------------------------------- 3
1-1

Background ---------------------------------------------------------------------- 3

1-2

Reasons for Introducing AMS --------------------------------------------- 3

1-3

Legal Basis ----------------------------------------------------------------------- 4

2. BASICS -------------------------------------------------------------------- 5
2-1

General Principles ------------------------------------------------------------- 5

2-2

Scope ------------------------------------------------------------------------------ 5

2-3

Definition of Terms ----------------------------------------------------------- 5

2-4

Korea Manifest System ------------------------------------------------------ 6

3. DETAILED GUIDELINES --------------------------------------------- 7
3-1

Person Obliged to Submit Manifests ----------------------------------- 7

3-2

Timeline to Submit Manifests --------------------------------------------- 7

3-3

Data Elements and Preparation Methods ----------------------------- 8

3-4

Data Verification

3-5

Do-Not-Load Actions --------------------------------------------------------- 9

3-6

Cancellation of Declaration ------------------------------------------------ 9

3-7

Application for Amendments --------------------------------------------- 10

3-8

Declaration of Unloading

3-9

Onsite Inspection of Export Goods ------------------------------------- 11--------------------------------------------------------- 9-------------------------------------------------- 10

4. ENFORCEMENT MEASURES ---------------------------------------11
4-1

Date of Enforcement-------------------------------------------------- 114-2

Administrative Sanctions -------------------------------------------------- 111

1. INTRODUCTION
1-1 BackgroundConsidered as a key document for customs administration, manifest refers to a full list ofcargo carried in a sea or air transport-unit which gives particulars such as the description ofimport/export cargos and supply chains, enabling Customs to conduct risk management,
bonded goods management, and loading performance management.

In response to the 9/11 attacks in 2001, the Advance Manifest System has been put forward
as an answer to enhance logistics security, and since then it has become a global norm. In
this context, the WCO adopted “SAFE Framework of Standards to Secure and Facilitate
Global Trade”, encouraging worldwide implementation of advance manifest reporting.

In consideration that major trading partners such as the U.S., EU and China already adopted
the Advance Manifest System, the Korea Customs Service (hereinafter referred to as “the
KCS”), in cooperation with stakeholders in the supply chain, introduced the Advance
Manifest System to abide by WCO guidelines as well as to fulfill its own responsibilities as agovernmental agency of duties collection and border protection.

1-2 Reasons for Introducing the Advance Manifest System(1) To ensure that export goods meet foreign Advance Manifest System requirements byredefining local trade contracts, transportations and customs clearance in compliance withinternational standards(2) To curb illegal exports and commercial fraud ranging from fake goods to false labeling ofcountry of origin of goods, by obtaining loading information of export cargo prior to sea or air
shipping(3) To promote seamless distribution of cargo and reduction of logistics costs by obtaining
loading information of import and transit cargo prior to arrival, which in turn will improvemonitoring high-risk consignments while completing import clearance procedures for normal
consignments in advance, leading to their immediate release after unloading instead ofbeing forwarded to bonded warehouses21-3 Legal Basis
Legal basis under the provisions of the Customs Act related to the Advance Manifest System(hereinafter referred to as “the AMS”) is stated below:(Article 135, Clause 2) If it is required for going through rapid entry and customs
clearance procedure, and conducting efficient supervision and control, the collectorof customs (hereinafter referred to as “customs collector”) may have the shipping or
aviation company to which the ship or aircraft entering into the port submit the list ofpassengers, manifest, etc. prior to the entry, under the conditions as prescribed by
the Commissioner of the Korea Customs Service.

(Article 136, Clause 2) When a foreign trade vessel or aircraft desires to depart froman open port, the captain thereof shall, prior to departure, obtain a departure permit
from customs collector. The captain of a vessel or aircraft shall submit a list of
goods boarded at the open port.

(Article 140, Clause 2) When goods are to be loaded to or unloaded from any
foreign trade vessels or aircraft, a declaration thereon shall be made to customs
collector and confirmation thereon shall be obtained on the spot from customs
officers.

Essential particulars related to the AMS, including timeline of submission, specification
templates, preparation method and application for corrections should comply with the“Notification of Loading and Unloading Procedure of Entry and Departure for Bonded Cargo(2011-7, March 18, 2011)” by the KCS.

2. BASICS
2-1 General Principles
Ocean and air carriers should comply with timeline of manifest submission, and should
complete and submit manifest which should exactly correspond to the list of cargo on board.

Manifest should be submitted in compliance with required items, specification and3

instructions stipulated in the “Message Implementation Guide” issued by the KCS, and also,
ocean and air carriers, in cooperation with forwarders, should be careful not to have any
discrepancies in the contents of submitted manifest.

In case cargo on board is found to be not the same as cargo requested for transportation oris identified as prohibited item for export or import according to the Customs Law, carriers
should report promptly the irregularity to customs collector

2-2 ScopeThis guideline applies to export, import, transit, returning and temporarily unloaded cargo.

In spite of the regulation mentioned above, this guideline does not apply to freight remaining
onboard and leaving for foreign country as its final destination without being unloaded fromvessel or aircraft in the territory of Korea. However, exception may be made by Customs’
own determination in case it considers surveillance or inspection is necessary for
aforementioned shipments.

2-3 Definition of Terms
The definition of terms used in this guideline provides that:"Manifest” is a list of goods comprising cargo carried in a sea or air transport-unit with the
Master B/L information remarked by ocean or air carriers, written and compiled inaccordance with the “Message Implementation Guide” issued by the KCS. It is called“Consolidated Cargo Manifest” if forwarders remark the House B/L list.
“Person obliged to submit manifests” includes maritime shipping lines operating international
trade ships (including freight forwarders, hereinafter referred to as “ocean carriers”) andairlines (in case of freight forwarder and joint operating airline, actual operating airline; andhereinafter referred to as “air carriers”).

“Person in charge of preparation of manifests” comes under one of the following:① Ocean or air carriers collecting and transporting export and import cargo;② In the case of joint operation, ocean or air carriers chartering vessels and aircraft(including freight forwarders); or
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③ In the case of consolidated cargos, forwarders (including its agents)“Master B/L” is the bill of lading issued by ocean carriers or an air waybill issued by air
carriers.

“House B/L” is the bill of lading or an air waybill that forwarders issue directly to shippers.

“Transit goods” are goods stopping by Korea to be transported to other countries, thus not
subject to export/import declaration or return declaration.

“Electronic document” is electronic data designed for transmission between computers,
written and compiled in accordance with the “Message Implementation Guide” issued by the
KCS.

2-4 Korea Manifest System
The KCS runs the Korea Manifest System (hereinafter referred to as “the KMS”) for better
processing of acceptance, handling and risk management of manifests submitted by ocean
carriers or air carriers.

After compiling and completing manifest, ocean and air carriers should submit it to the KMS
through message broker who is designated by the KCS to perform data validation between
the KMS and submitter.

3. DETAILED GUIDELINES

3-1 Person Obliged to Submit Manifests
Ocean and air carriers are obliged to submit manifests for export and import cargo, and arelegally responsible for any breach of submission deadlines as well as the content, accuracy
and completeness of submitted data. Local freight forwarders take responsibility of compilingand correcting export House B/L data as an entity in charge of compiling consolidated cargo
manifests.

5With regard to consolidated cargo, carriers should collect and compile House B/L data fromfreight forwarders (, including those who handle consolidated cargo in the country ofexportation) and submit it after final verification to the KCS in accordance with the “Message
Implementation Guide”.

Carriers can entrust the task of manifest compiling and submission to message broker as
authorized by the KCS according to the Article 327-3 of the Customs Law.

3-2 Timeline to Submit Manifests
Based on the WCO SAFE Framework and in consideration of special circumstance of shortflight or short-sea-shipping and capability of concerned logistics entities, due date ofsubmission defined by the KCS is as following:Type

Deadline(Principle) At least 24 hours before commencement of loading
Importat the port of loading.
(Short sea shipping) Before departure at the port of loading(Bulk) At least 4 hours before arrival at the port of entry

SEA(Principle) At least 24 hours before commencement of loading
Export(Short sea shipping) Prior to loading, 30 minutes before
departure(Bulk, Transit cargo) Before departure(Principle) At least 4 hours before arrival

AIR

Import(Short haul) Before departure at the airport of loading (morespecifically, at time of “wheels up” of aircraft)(Express Cargo) At least 1 hour before arrival

Export Prior to loading, 30 minutes before departure* “Wheels up” is the moment when an airplane’s wheels reach its body after takeoff

The scope of short-haul-flight areas is limited to China, Taiwan, Hong Kong, Japan, and farEastern Russia.

In case of export sea cargo, the Philippines, Vietnam, Cambodia, Thailand, Indonesia,
Malaysia, and Singapore are also regarded as short-sea-shipping areas.
63-3 Data Elements and Preparation Methods
3-3-1 Guide on Electronic Manifest
Data elements and preparation methods for manifests are defined in the “Message
Implementation Guide” issued by the KCS, and the types of manifests are as below.
① Export Manifest of Air Cargo (Appendix Form 1)② Import Manifest of Air Cargo (Appendix Form 2)③ Export Manifest of Sea Cargo (Appendix Form 3)④ Import Manifest of Sea Cargo (Appendix Form 4)-Ocean and air carriers should compile and submit manifests with particulars like item name,definitions, conditions and specifications stipulated in the “Message Implementation Guide.”3-3-2 Instructions on Goods Description
Carriers and freight forwarders should pay special attention to goods description during
manifest preparation in order that common mistakes will not be made.

The column for “Good Description” should not be filled in with any meaningless numbers,
marks or general terms such as:① Meaningless numbers and marks: 0, 1, 11, A, AB, %, $, #, @, etc.
② General terms: PARTS, SAMPLE, ACCESSORY, etc.
Goods description should be described in specific and precise manner as used in tradedeals in order that the KCS can identify the nature of goods. “Examples of Goods
Descriptions Accepted or not Accepted” in Appendix Table 1 can be referred for this purpose.

3-4 Data Verification
Customs collector will verify the content, accuracy and completeness of declared manifest,
and submitted data can be accepted by the KMS only when declared contents are validated
to be free of error.

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When an error is found in declared manifest in the process of verification, customs collectors
should inform concerned carriers of such errors by electronic means. In such case, thecarriers should submit amended version of manifest.

In order to efficiently perform data verification on declared manifests, the KCS may
designate a data verification operator among message brokers and, in this case, should
provide the operator with such information as enforcement regulations, items to verify,
verifying methods and procedures.

Data verification operator must provide enough information on enforcement regulations andthe operation of verification system to users such as ocean and air carriers and forwarders.

3-5 Do-Not-Load Actions
Do-Not-Load (hereinafter referred to as “DNL”) notification may be issued by Customs
against such cargo that is considered risky for security purpose by the KCS.

DNL notification applies only to deep-sea containerized shipments for which manifest should
be submitted at least 24 hours prior to loading.

3-6 Cancellation of Declaration
In principle, ocean and air carriers cannot withdraw their manifests submitted to the KCS.

Customs collector may permit cancellation of declaration after reviewing supporting
documents submitted by carriers, when the reason for cancellation falls into one of thefollowing categories:① Non-arrival of vessels or aircraft due to bad weather or accidents, etc.;② Change in operating schedule of vessels or aircrafts;③ Transmission error of Manifest Reference Numbers (MRN); or④ If customs collector determines that such a provision is necessary.

If ocean and air carriers wish to withdraw their manifests, they should submit an application
for cancellation to customs collector, in accordance with the “Message Implementation Guide(Appendix Form 5)” issued by the KCS.
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3-7 Application for Amendments
In case ocean and air carriers and freight forwarders intend to amend parts of their manifests
after submission, they should submit an application for amendment to customs collector, in
accordance with the “Message Implementation Guide (Appendix Form 6 and 7)” issued by the
KCS.

Customs collectors may permit the amendment of submitted manifest, and check relevant
cargo on the spot if deemed necessary, after reviewing supporting documents submitted bycarriers, when the reason for amendment or the part to be corrected falls into one of thefollowing categories:① Addition of B/L to correct omission on manifests;② Consignee(Shipper);③ Forwarder;④ Freight classification and attributes of cargo; or⑤ If customs collector determines that such a provision is necessary for risk
management.

In case that cargo is classified high-risk one by the KMS, submitted amendment request
should be accepted only after inspection is made on it and the result is filed by Customs.

3-8 Declaration of Unloading
In case ocean and air carriers wish to unload cargo, a declaration of unloading should besubmitted to customs collector, in accordance with the “Message Implementation Guide(Appendix Form 8 and 9)” issued by the KCS.

Ocean and air carriers, or message broker designated by the KCS, should provide
information on import cargo manifest by ship or flight number, so that freight forwarders canapply for unloading or bonded-warehousing plan, etc. for import cargo.

If unloaded cargo does not match with declared manifest, ocean and air carriers should
submit the report of unloading result to customs collector, in accordance with the “Message
Implementation Guide (Appendix Form 10 and 11)” issued by the KCS.

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3-9 On-site Inspection of Export Goods
In line with the implementation of the AMS, and as part of strengthened risk management efforts,
customs collector shall do special inspection on selected export goods at the place of sea-/
airports of loading to verify actual loading status and declared information of those cargo.

Ocean and air carriers and freight forwarders should submit export goods permission
number (EPN), which is one of particulars of export cargo manifest, to the KMS before
loading (except for cargo of which manifests should be submitted 24 hours before loading).

If a cargo is selected by the KCS as an object of special export inspection, ocean and air
carriers should request for inspection to Customs when it is checked in container terminals
at sea ports or cargo terminals at airports.

When ocean and air carriers load cargo and leave sea-/airport without requesting for
inspection to Customs even when the loaded cargo are selected for inspection, they shall be
penalized for violating Article 265 of the Customs Act, Inspection of Goods or Transport, etc.

Detailed operating procedures for inspecting export goods at the port of loading should be
followed in accordance with the “Detailed Regulations about Inspecting Goods at the Port of
Loading” issued by the KCS.

4. ENFORCEMENT MEASURES

4-1 Date of Enforcement
The AMS will be enforced from December 1, 2011 for maritime export cargo and air
export/import cargo.

Regarding maritime import cargo and transit cargo (only for departure), the AMS will be
enforced from a specific date designated by the Commissioner of the KCS.

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4-2 ADMINISTRATIVE SANCTIONSWhen ocean or air carriers fail to submit manifest declarations before the due date ofsubmission, they shall be penalized for violating Article 276 of the Customs Act, False
Declaration.

For smooth transition to the AMS and improvement in trade practices among ocean and air
carriers, freight forwarders, exporters and importers, administrative sanctions (fines andpenalties) will be suspended until June 30. 2012.

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Appendix Table 1.

Examples of Goods Descriptions Accepted or not Accepted

Not Acceptable

Acceptable

ApparelWearing Apparel
Ladies' Apparel
Men's Apparel

Clothing
Shoes
FootwearJewelry (may include watches)

Appliances

Kitchen Appliances
Industrial Appliances
Heat Pump

Auto partsParts

New Auto parts
Used Auto parts

Caps

Baseball Caps
Blasting Caps
Bottle Caps
Hub Caps

Chemicals, hazardous
Chemicals, non-hazardous

Actual Chemical Name (not brand name)Electronic Goods
Electronics

Computers
Consumer Electronics, Telephones
Electronic Toys(can include Gameboys, Game Cubes,
Dancing Elmo Doll etc.)
Personal/Household Electronics (i.e. PDA's VCR's, TV's)

Equipment

industrial Equipment, Oil Well Equipment
Automotive Equipment, Poultry Equipment etc.

Flooring

Wood Flooring, Plastic Flooring, Carpet,
Ceramic Tile,
Marble Flooring

Foodstuffs

Oranges
Fish
Packaged Rice, Packaged Grain, Bulk Grain

Iron

Iron Pipes, Steel Pipes

Steel

Iron Building Material, Steel Building Material

Leather Articles

Saddles
Leather Handbags
Leather Jackets, Shoes

Machinery

Metal Working Machinery
Cigarette Making Machinery12Machines

Sewing Machines
Printing Machines

Pipes

Plastic Pipes
PVC Pipes
Steel Pipes
Copper Pipes

Plastic Goods

Plastic Kitchenware, Plastic Houseware,
Industrial Plastics
Toys, New/Used Auto Parts

Polyurethane

Polyurethane Threads
Polyurethane Medical Gloves
Personal Effects
Household Goods.

Rubber Articles

Rubber Hoses
Tires
Toys
Rubber Conveyor Belts

Rods

Welding Rods
Rebar
Aluminum Rods
Reactor Rods

Scrap

Plastic Scrap
Aluminum Scrap
Iron Scrap

STC (Said to Contain)
General Cargo
FAK (Freight of All Kinds)"No Description"
Tiles

Ceramic Tiles
Marble Tiles

Tools

Hand Tools
Power Tools
Industrial Tools

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