KCCI Begins Issuing 'Domestic Origin Certificates' for Public Procurement Goods
by Jeong Donghoon
Published 11 Apr.2023 12:00(KST)
'Certificate of Origin' will be issued not only for export but also for domestic use.
The Korea Chamber of Commerce and Industry (KCCI) announced that it will start issuing the 'Domestic Certificate of Origin' from the 12th. Until now, certificates of origin have been issued only for export goods by the KCCI and the Korea Customs Service.
The domestic certificate of origin is a document that proves a product is made in Korea when domestic companies bid for public procurement by the Public Procurement Service. The legal basis for issuance was specified in the Foreign Trade Act in June last year. Since then, detailed issuance standards have been established through consultations among government ministries such as the Ministry of Trade, Industry and Energy and the Public Procurement Service, and the KCCI has built an electronic issuance system.
The issuance targets a wide range of manufactured goods (excluding agricultural products and food), including electronic and electrical equipment, machinery and steel products, optical and medical devices, plastics, and clothing. The products must undergo manufacturing processes beyond simple processing in Korea, and the added value generated domestically in the process of making the finished product must be at least 51%.
Until now, certificates of origin have been issued only for export purposes and used for customs clearance and tariff reduction. In contrast, when goods processed and produced domestically were sold in the domestic market, there was no issuing agency for certificates, and companies often self-declared the products as Korean-made, resulting in frequent violations of origin labeling regulations.
With the issuance of domestic certificates of origin, it is expected that companies will reduce the risk of incorrect origin declaration and that trust in excellent domestic products across the industry will increase. It is also expected to reduce cases of falsely labeling products as domestic in public procurement. Last year alone, 287 cases of violations of domestic origin labeling were detected and cracked down on by the Korea Customs Service, amounting to 616.7 billion KRW, with about half occurring in public procurement.
In this regard, the Public Procurement Service plans to select key items for origin management and require mandatory submission of the 'Domestic Certificate of Origin' when contracting for public procurement. In the long term, it plans to link the electronic procurement system of the Korea On-line E-Procurement System (KONEPS) with the KCCI’s domestic certificate of origin system to strengthen origin management of domestic products.
Meanwhile, the KCCI, together with the Ministry of Trade, Industry and Energy and the Public Procurement Service, plans to hold an explanatory session on April 21 at 2 p.m. for companies to introduce the domestic certificate of origin system and public procurement utilization methods. Additionally, the KCCI will operate a consultation lounge for the domestic certificate of origin, providing expert online and offline consultation services.
Kim Jong-tae, head of the Certificate of Origin Center at the KCCI, said, “The Chamber of Commerce and Industry has issued certificates of origin for export since 1952, and now it is meaningful that we can also certify Korean origin for goods produced and distributed domestically.” He added, “We hope that the domestic certificate of origin will increase trust in excellent products made in Korea and serve as an opportunity for our companies to grow further.”
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