"Trump May Appeal Tariffs... Refund Applications Must Be Expedited"

KITA Holds Seminar for Korean Exporters to the U.S.
Guidance on Reciprocal Tariff Refunds Provided
Caution Urged: Errors in Origin, Product Classification, or Declared Value
May Lead to Additional Tariff Assessments and Penalties

As U.S. customs authorities have initiated the process for reciprocal tariff refunds, experts have advised that Korean exporters to the U.S. must act quickly to apply for refunds so as not to miss the golden window of opportunity.

The Korea International Trade Association held an online seminar on May 6, titled "U.S. IEEPA Tariff Refund and Section 232 Tariff Risk Response." The seminar was organized to provide guidance on the application process and key considerations for tariff refunds, following an illegal ruling on reciprocal tariffs under the International Emergency Economic Powers Act (IEEPA) and the subsequent launch of refund procedures by the U.S. government.

During the seminar, experts unanimously emphasized the need to expedite refund applications, noting the possibility of an appeal by the Trump Administration. While the imposition of reciprocal tariffs has been ruled invalid by the Supreme Court, the process of refunding these tariffs to global companies remains legally contentious and open to further litigation.

Kim Taejoo, Executive Director at Samjong KPMG, cautioned that if errors in origin, product classification, or declared value are discovered during the U.S. Customs and Border Protection (CBP)'s refund review process, not only could refunds be withheld, but there could also be additional tariff assessments and penalties. He stressed the need for thorough attention to detail.

Kim further explained, "During the refund application process, CBP may request non-preferential origin information and could determine that the goods are of Chinese origin, subsequently reclassifying them as subject to Section 301 tariffs. Korean companies should therefore re-examine the origin of goods exported to the U.S. after partial processing in Korea, and if risks are identified, establish internal documentation systems to respond to CBP inquiries."

Risks were also raised regarding the recently revised calculation method for steel derivative products. Kim noted, "CBP may request information on the steel and aluminum content of derivative goods exported by Korean companies, and if errors are found, may impose separate assessments based on Section 232 immediately after the reciprocal tariff refund. Each company should proactively review the calculation and reporting of content in their steel derivative products to ensure accuracy."

Shim Jongseon, Partner at Deloitte Anjin, highlighted the recently restructured approach to Section 232 tariffs under the Trade Expansion Act. He pointed out that, in the past, a complex structure existed in which Section 232 tariffs were imposed on the metal content of steel, aluminum, and copper derivatives, while reciprocal tariffs were applied to non-content portions. This has led to ongoing disputes over the calculation of taxable value. He also emphasized the importance of accurate declared value calculations and supporting documentation during the refund application process, noting that reviews of prior customs declarations for metal content value could delay refunds.

Cho Sungdae, Head of the Trade Policy Research Office at the Korea International Trade Association, explained that the 10% tariff imposed under Section 122 of the Trade Act, which replaced reciprocal tariffs, can only be levied for up to 150 days. Cho stated, "To continue imposing tariffs after July 24, cooperation from Congress would be required, but this is unlikely. It appears that the U.S. administration is preparing for this by proceeding with Section 301 of the Trade Act."

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