Overseas Direct Purchase 'Duty-Free Regulations' Exploited...Massive Seizure of Smuggling Firms Worth 24.1 Billion KRW

Counterfeit golf balls seized while attempting to pass through customs via smuggling. Provided by the Korea Customs Service

[Asia Economy (Daejeon) Reporter Jeong Il-woong] A number of companies attempting to smuggle goods by abusing the duty-free regulations for overseas direct purchase items have been caught in large numbers.

The Korea Customs Service announced on the 18th that during the special crackdown period from September to November targeting overseas direct purchase abuse, 43 companies attempting to smuggle 11.25 million items (worth approximately 24.1 billion KRW) of overseas direct purchase goods were caught and either sent to the prosecution or given warning dispositions.

These companies are suspected of attempting smuggling by abusing the duty-free regulations applied when the overseas direct purchaser imports items for personal use.

For example, the caught companies brought in smartwatches, gaming consoles, hair loss treatments, and other items as listed clearance goods under 150 USD exempt from customs import declaration or imported goods into the country via international mail.

Listed clearance is a system that allows duty-free customs clearance without formal import declaration for goods under 150 USD (200 USD if imported from the United States) intended for personal use only. There were a total of 31 cases abusing this system, and the smuggled goods amounted to 5.56 million items worth approximately 14.9 billion KRW.

The caught companies are also suspected of customs evasion, illegal importation, and intellectual property rights infringement.

Customs evasion was carried out by making consumers who purchase wristwatches, clothing, etc., through overseas direct purchase pay taxes including customs duties and VAT, but the companies reported a lower actual price to customs than the amount paid.

Through this method, the companies cleared 17,701 items while evading 1.8 billion KRW in taxes.

Additionally, items such as oatmeal for sale, digestive medicine, and infant toys were falsely declared as for personal consumption and illegally imported without meeting import requirements, then sold on online shopping malls (52,448 items worth approximately 1.1 billion KRW illegally imported). Furthermore, counterfeit goods such as famous brand golf balls and bags were brought in through listed clearance and international mail and sold on online shopping malls (2,523 items worth approximately 900 million KRW infringing intellectual property rights).

Meanwhile, apart from the special crackdown, the Korea Customs Service conducted joint intensive monitoring activities on illegal online transactions with open marketplaces such as 11st, Naver, Auction, Coupang, and secondhand trading platforms like Danggeun Market and Junggonara during periods of rapid increase in overseas direct purchases such as Guanggunje (November 11) and Black Friday (November 26) last month.

Also, regarding 90,183 sales posts suspected of intellectual property rights infringement detected during the monitoring activities, measures such as suspension of sales and termination of use were taken.

This content was produced with the assistance of AI translation services.