"Customs Service Promotes Duty-Free Industry Activation: 'Duty-Free Goods Can Also Be Collected at Arrival Halls'"

[Asia Economy (Daejeon) Reporter Jeong Il-woong] The Korea Customs Service is promoting measures to revitalize the duty-free industry, including online purchases at duty-free shops and duty-free product pickup at arrival halls.

On the 14th, the Korea Customs Service presented plans to revitalize the duty-free industry at the ‘Duty-Free Industry Development Meeting’ held at Shinsegae Duty-Free Shop in Jung-gu, Seoul, with duty-free industry representatives, related government departments, and institutions.

The revitalization plans are summarized as ▲ enhancing convenience for citizens using duty-free shops ▲ expanding the revenue base of duty-free shops ▲ easing the burden on duty-free shops through regulatory innovation.

First, the Korea Customs Service will allow online purchases of duty-free goods at departure and arrival duty-free shops, enabling overseas travelers to pre-order and prepay for products from downtown duty-free shops and departure/arrival duty-free shops online.

In particular, in the first half of next year, a pilot ‘arrival hall delivery area’ will be installed and operated at Busan Port to reduce the inconvenience of having to carry duty-free goods during travel, thereby expanding domestic duty-free shop sales.

This means revising the system so that duty-free goods purchased during departure can be received upon arrival. According to the Korea Customs Service, such systems are already in operation in major advanced tourist countries such as Hong Kong, Australia, and New Zealand.

To enhance convenience for citizens, the Korea Customs Service plans to allow online purchases of duty-free ‘alcohol’ at downtown duty-free shops and establish a mobile service system for automatic calculation and payment of customs duties on carried goods.

Expanding the revenue base of duty-free shops involves enabling online sales without restrictions on sales channels such as open markets and metaverse platforms at all duty-free shops, including downtown duty-free shops.

Previously, online sales were not allowed at departure and arrival duty-free shops, and even downtown duty-free shops were only permitted to sell online through their own exclusive online sites.

However, the Korea Customs Service expects that allowing online sales on all online platforms will activate duty-free transactions and strengthen the revenue base.

Additionally, considering the recent deterioration in profitability of the duty-free industry due to COVID-19 and other factors, the Korea Customs Service is reviewing, in consultation with the Ministry of Economy and Finance, extending a 50% reduction in license fees this year. The 50% reduction in license fees was already applied to sales from 2020 to 2021, but no decision has been made yet for this year.

Efforts to ease the burden on duty-free shops through regulatory innovation will also be pursued. By establishing a ‘preliminary license system,’ new license holders will be able to prepare for business by bringing in duty-free goods to their premises before the license date. Restrictions that allowed sales only when there was inventory in stock will be relaxed to permit sales even if there is no immediate inventory, thereby reducing the operational burden on the duty-free industry.

Furthermore, small and medium-sized enterprises (SMEs) and mid-sized companies operating both departure and arrival duty-free shops will be allowed to use a single warehouse for integrated management of goods, reducing logistics costs for SMEs, mid-sized duty-free shops, and downtown duty-free shops.

In cases where downtown duty-free shop products are returned, they will be allowed to be brought directly into the integrated logistics warehouse without passing through the selling duty-free shop.

Yoon Tae-sik, Commissioner of the Korea Customs Service, said, “We have prepared ‘Duty-Free Industry Revitalization Measures’ to ease the difficulties faced by the duty-free industry due to the impact of COVID-19, rising exchange rates, and intensified international competition.” He added, “We hope these measures, combined with recent increases in duty-free limits and the abolition of pre-arrival PCR tests, will serve as a catalyst to revitalize the duty-free industry.”

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