China

SKorea Uncovers $20.8M in Origin Fraud From Mostly US-Bound PRC Goods

Published APR 21 2025

Story

Above: A CMA CGM SA vehicle carrier cargo ship docked at the port of Ulsan at dusk in Ulsan, South Korea, on March 30, 2025. Image credit: SeongJoon Cho/Contributor/Bloomberg via Getty Images

The Facts

The Korea Customs Service discovered 29.5 billion won (US $20.8 million) worth of country-of-origin violations in Q1 2025, with 97% of shipments bound for the United States, marking a significant increase from 2024 when U.S.-bound shipments accounted for 62% of violations.
Reuters
Firstpost
Predominantly Chinese companies are reportedly mislabeling products as "Made in Korea" to leverage South Korea's U.S. free trade agreement and evade the current 145% tariff rate on Chinese goods. South Korea currently faces a temporarily suspended 25% U.S. tariff.
CNA
Tech in Asia
Investigators uncovered 3.3 billion won (US $2.3 million) worth of Chinese battery cathode materials and 19.3 billion won (US $13.6 million) of surveillance cameras that were illegally relabeled or reassembled in South Korea to bypass U.S. restrictions.
The Straits Times
The Economic Times
The investigation revealed sophisticated circumvention methods, including strategic disassembly-reassembly processes and false documentation, designed to qualify products as substantially transformed under trade rules.
Regtechtimes
Tech in Asia
The surge in violations coincides with U.S. President Trump's return to office in January 2025 and his implementation of new tariff policies targeting various countries, particularly China, beginning in February.
Tech in Asia
Firstpost
South Korean customs officials have formed a special task force and are working with U.S. authorities to prevent illegal exports and protect domestic companies from fraud. Meanwhile, detected violations are being referred to prosecutors.
CNA
Ukrainian National News (UNN)

Sources Split

LEFT

CENTER

RIGHT

ESTAB
CRIT

CENTER

PRO
ESTAB

The Spin

Narrative A

The sharp rise in tariff evasion — driven by falsely labeling Chinese goods as Korean-made to bypass U.S. trade rules — poses a threat to global trade integrity and national security. This surge undermines legitimate Korean manufacturers and demands swift, coordinated action.

Regtechtimes

Narrative B

New U.S. tariffs are shaking South Korea’s export economy, disrupting key industries like autos, electronics, and petrochemicals. These measures risk straining U.S.-Korea trade ties, raising consumer prices, and forcing Korean firms to rethink supply chains and market strategies.