ACT ON SPECIAL CASES CONCERNING THE REFUND OF CUSTOMS DUTIES LEVIED ON RAW MATERIALS FOR EXPORT
Wholly Amended by Act No. 5197, Dec. 30, 1996
Amended by Act No. 6305, Dec. 29, 2000
Act No. 7210, Mar. 22, 2004
Act No. 8050, Oct. 4, 2006
Act No. 8233, Jan. 11, 2007
Act No. 8829, Dec. 31, 2007
Act No. 8852, Feb. 29, 2008
Act No. 10817, Jul. 14, 2011
Act No. 11121, Dec. 31, 2011
Act No. 12170, Jan. 1, 2014
Act No. 13559, Dec. 15, 2015
Act No. 14466, Dec. 27, 2016
Act No. 15226, Dec. 19, 2017
Act No. 16105, Dec. 31, 2018
Act No. 17339, jun. 9, 2020
The purpose of this Act is to stipulate special provisions for the Customs Act, the Provisional Import Surtax Act, the Individual Consumption Tax Act, the Liquor Tax Act, the Traffic, Energy and Environment Tax Act, the Act on Special Rural Development Tax, the Education Tax Act, the Framework Act on National Taxes and the National Tax Collection Act, thereby contributing to efficient support for export activities and balanced industrial development through proper refund of taxes imposed on raw materials for export such as customs duties, provisional import surtax, individual consumption tax, liquor tax, traffic, energy and environment tax, agricultural and fishing villages special tax and education tax. [This Article Wholly Amended on Jul. 14, 2011]
The terms used in this Act are defined as follows: <Amended on Dec. 31, 2018>
| 1. | The term "customs duties, etc." means customs tax, provisional import surtax, individual consumption tax, liquor tax, traffic, energy and environment tax, agricultural and fishing village special tax and education tax; |
| 3. | The term "export goods" means goods offered for the purpose of export, etc.; |
| 4. | The term "required amount" means the amount of raw materials required to produce export goods (including the processing, assembling, repair, recycling, or remodeling of export goods; hereinafter the same shall apply) including the amount of normal loss and wear from the production process; |
| 5. | The term "refund" means refunding to the exporter or the producer of export goods the customs duties, etc. under this Act, which have been paid at the time of importing raw materials for export as prescribed in Article 3 or are to be paid, notwithstanding the Customs Act, etc.; |
| 6. | The term "settlement of accounts" means offsetting the customs duties, etc., which are to be paid each period in a lump sum pursuant to Article 6 (1) on raw materials for export under Article 3, against the refund amount suspended pursuant to Article 16 (3). |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 3 (Raw Materials Subject to Refund) |
| (1) | Raw materials for which customs duties, etc. may be refundable (hereinafter referred to as "raw materials for export") shall be as follows: <Amended on Dec. 19, 2017> |
| 1. | Where goods are produced and then exported, any of the following materials, the required amount of which can be objectively calculated: |
| (a) | Materials physically or chemically combined with relevant export goods; |
| (b) | Materials expended for the production of relevant export goods: Provided, That materials expended indirectly for the production of export goods, such as those for the operation and maintenance of production machinery, apparatus, etc., shall be excluded; |
| (c) | Packing materials of relevant export goods; |
| 2. | Where goods are imported and then exported without any change made, such export goods. |
| (2) | If domestically produced raw materials and imported raw materials have the same quality and characteristics and are used interchangeably in the production process of export goods, they shall be deemed raw materials for export. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 4 (Export, etc. Subject to Refund) |
Export, etc. for which customs duties, etc. levied on raw materials for export may be refundable shall be any of the following:
| 1. | Export for which an export declaration has been accepted under the Customs Act: Provided, That those exported free of charge shall be limited to such exports as prescribed by Ordinance of the Ministry of Economy and Finance; |
| 2. | Of the sales or construction works which acquire foreign currency in the Republic of Korea, those prescribed by Ordinance of the Ministry of Economy and Finance; |
| 4. | Others recognized as exports, which are prescribed by Ordinance of the Ministry of Economy and Finance. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 5 (Collection of Customs Duties, etc. on Raw Materials for Export) |
| (1) | The head of a customs office shall collect customs duties, etc. on imported raw materials for export at the time of import, notwithstanding the provisions of the Customs Act, etc. |
| (2) | Deleted. <Dec. 31, 2018> |
| (4) | Deleted. <Dec. 31, 2018> |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 6 (Lump-Sum Payment of Customs Duties) |
| (1) | Where a person who imports raw materials for export files an application, as prescribed by Presidential Decree, notwithstanding the provisons of the Customs Act, etc., the head of a customs office may designate him or her as a person who may pay customs duties, etc. on such raw materials in a lump sum (hereinafter referred to as "enterprise for lump-sum payment of customs duties, etc.") for each period prescribed by Presidential Decree within a period of six months (hereinafter referred to as "lump-sum payment period") and allow him or her to pay such customs duties, etc. in a lump sum. In such cases, where a person who intends to be designated as an enterprise for lump-sum payment of customs duties, etc. falls under any of the following, the head of a customs office may require him or her to provide collateral the value of which is equivalent to the amount of tax which he or she intends to pay in a lump sum, as prescribed by Presidential Decree: |
| 1. | A person in whose case two years have not passed since his or her imprisonment with prison labor was completely executed (including cases where he/she is deemed to have served his/her sentence in prison) or exempted as declared by a court for violating Article 23 or the Customs Act; |
| 2. | A person who is under the suspension of the execution of imprisonment with prison labor as declared by a court for violating Article 23 or the Customs Act; |
| 5. | A person in whose case it is difficult for the head of a customs office to secure claims for customs duties prescribed by Presidential Decree in consideration of the volume of imports brought in, the rates of customs duties, etc. on imported goods. |
| (2) | Where the head of a customs office intends to designate an enterprise for lump-sum payment of customs duties, etc. pursuant to paragraph (1), he or she shall set the limit on the amount of tax that may be paid in a lump sum. |
| (3) | The payment deadline on customs duties, etc. under paragraph (1) shall be the 15th of the month following the month includes the day the relevant lump-sum payment period expires. |
| (4) | Where a person who was designated as an enterprise for lump-sum payment of customs duties, etc. intends to obtain adjustment of the limit on the amount of customs duties that may be paid in a lump sum, he or she shall file an application for adjustment of the limit on the amount of such customs duties with the head of a customs office. In such cases, the head of the customs office may require him or her to provide additional collateral. |
| (5) | Where a person who was designated as an enterprise for lump-sum payment of customs duties, etc. falls under any of the subparagraphs of paragraph (1), the head of a customs office shall revoke his or her designation. |
| (6) | Where a person whose designation was revoked pursuant to paragraph (5) pays the whole amount of customs duties, etc. or files an application for designation of an enterprise for lump-sum payment of customs duties, etc. again after the ex officio settlement of account is completed pursuant to Article 8 (1), the head of a customs office may require him or her to provide collateral pursuant to the latter part of paragraph (1). |
| (7) | The Commissioner of the Korea Customs Service may establish standards and procedures necessary for the designation of enterprises for lump-sum payment of customs duties, etc. under paragraph (1). |
[This Article Wholly Amended on Dec. 31, 2018]
| Article 7 (Settlement of Accounts of Customs Duties, etc. and Refund Amount on Raw Materials for Export) |
| (1) | The head of a customs office shall settle the accounts of the customs duties, etc. to be paid in a lump sum by an enterprise for lump-sum payment of customs duties, etc. pursuant to Article 6 (1) and the refund money, the payment of which is suspended under Article 16 (3), and shall notify the enterprise for lump-sum payment of customs duties, etc. of the results of such settlement (hereinafter referred to as "notification of settlement of accounts") by the day prescribed by Presidential Decree. <Amended on Dec. 31, 2018> |
| (2) | If any customs duties, etc. are found uncollected upon the settlement of accounts under paragraph (1), the head of a customs office shall deliver a duty payment notice pursuant to Article 39 (3) of the Customs Act within the period of notification under paragraph (1). |
| (3) | The enterprise for lump-sum payment of customs duties, etc. which has received the duty payment notice under paragraph (2) shall pay the customs duties, etc. by the 15th of the month following the month in which the lump-sum payment period expires. |
| (4) | If any refund money is found upon the settlement of accounts under paragraph (1), the head of a customs office shall immediately pay the relevant amount pursuant to Article 16 (1) and (4). |
| (5) | When the head of a customs office becomes aware of any excess or deficiency in the amount resulted from the settlement of accounts after the notification, he/she may rectify it. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 8 (Ex Officio Settlement of Accounts) |
| (1) | If any of the grounds prescribed by Presidential Decree occurs, the head of a customs office shall immediately settle the accounts of customs duties, etc. (hereinafter referred to as "ex officio settlement of accounts"), in order to ensure the collection of customs duties, which are not due until the date under Article 6 (3) and the refund money, the payment of which is suspended pursuant to Article 16 (3). <Amended on Dec. 31, 2018> |
| (2) | If the head of a customs office finds refund money payable as a result of the ex officio settlement of accounts, he/she shall immediately pay such refund money under Article 16. |
| (3) | If the head of a customs office finds customs duties, etc., to be collected as a result of the ex officio settlement of accounts, he/she shall deliver a duty payment notice pursuant to Article 39 (3) of the Customs Act. In such cases, the person who receives the duty payment notice shall pay the tax amount to the head of the relevant customs office within 10 days from the date when he/she receives such notice. |
| (4) | If an enterprise for lump-sum payment of customs duties, etc. who has provided collateral fails to pay customs duties, etc., after receiving the duty payment notice under paragraph (3), the head of a customs office shall use the collateral to offset the customs duties, etc. concerned. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 9 (Refund of Customs Duties, etc.) |
| (1) | If goods are used for export, etc., the head of a customs office shall refund the customs duties, etc. on the raw materials for export, which are used for such goods and imported within two years retroactive to the date prescribed by Presidential Decree: Provided, That if it is inevitable to delay the export, etc. of goods which require a long time to be used for export, etc. and are prescribed by Presidential Decree, due to unforeseen circumstances prescribed by Presidential Decree, the head of the customs office shall refund the customs duties, etc. on the raw materials for export, used for such goods and imported within three years retroactive to the date prescribed by Presidential Decree. <Amended on Dec. 15, 2015> |
| (2) | If raw materials for export are traded by a local letter of credit, etc. and such trade occurs, within the period prescribed by Presidential Decree from the date of the immediately preceding trade by a local letter of credit, etc. (if there is no immediately preceding trade by a local letter of credit, etc., it refers to the import), the period from the date of import of the raw materials for export to the date of the final trade by a local letter of credit, etc. shall not be included in counting the period under paragraph (1): Provided, That if the raw materials for export are traded in the same condition as imported, the same shall not apply. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 10 (Calculation of Refund Money, etc.) |
| (1) | An applicant for refund shall prepare a document in which the amounts of raw materials expended for export goods are calculated (hereinafter referred to as "statement of accounts for the amount required"), as prescribed by Presidential Decree, and shall calculate the refund money on the basis of such statement of accounts for the amount required. |
| (2) | Notwithstanding paragraph (1), if deemed necessary to simplify the process of calculating the required amount, the Commissioner of the Korea Customs Service shall determine and publicly notify the standard required amount on the basis of the average required amount for each export goods and may allow the applicant for refund to apply it as an option. |
| (3) | Where two or more different types of goods are produced by using one kind of raw material for export, the customs duties, etc. shall be refunded on the basis of the price of goods produced, as prescribed by the Commissioner of the Korea Customs Service. |
| (4) | Where any of the following events occurs and where it is deemed likely that the amount of refund of customs duties, etc. on raw materials for export is substantially higher or lower than the amount of customs duties paid at the time such raw materials are imported (in cases falling under subparagraph 2, subparagraph 1 applicable to the raw materials imported shall also be considered), the Commissioner of the Korea Customs Service may shorten the term of validity of an import declaration certificate referred to in Article 9 (1) which constitutes the basis for refund; or determine the quantity of raw materials for export subject to refund, based on the inventory of raw materials for export and import/export ratio of each company, as prescribed by Ordinance of the Ministry of Economy and Finance: <Amended on Jan. 1, 2014; Dec. 15, 2015> |
| 1. | Where any of the following causes is applicable to raw materials for export (limited to the raw materials imported): |
| (a) | Changes in the rates of customs duties; |
| (b) | Changes in import price; |
| (c) | Application of at least two different rates of customs duties; |
| 2. | Where domestically produced raw materials and imported raw materials, all of which are deemed raw materials for export pursuant to Article 3 (2), are used both for export and domestic consumption in the production process. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 10-2 (Application, etc. for Advance Examination on Required Amount) |
| (1) | Any person who intends to obtain a refund of customs duty, etc. may submit to the head of a customs office an application for advance examination as to whether the required amount is accurately calculated under Article 10 (1) and the method of calculating the required amount is appropriate (hereinafter referred to as “advance examination on the required amount”) before applying for the refund pursuant to Article 14. |
| (2) | Upon receipt of an application for advance examination on the required amount under paragraph (1), the head of a customs office shall examine whether the required amount is accurately calculated and the method of calculating the required amount is appropriate within the period prescribed by Presidential Decree; and then notify the result of such advance examination to the applicant: Provided, That where it is impracticable to conduct an advance examination due to incomplete data the applicant has submitted, the head of the customs office may notify the applicant of such fact, and then reject an advance examination on the required amount or require the applicant to correct the incomplete data. |
| (3) | Where a person who has been notified of the result of an advance examination on the required amount pursuant to the main clause of paragraph (2) has an objection against such result, he/she may file an application for re-examination with the head of the customs office not later than 30 days from the date of notification of the result. In such cases, paragraph (2) shall apply mutatis mutandis to the period for re-examination and notification of the result thereof. |
| (4) | Where a person who intends to obtain a refund of customs duty, etc. files an application for the refund pursuant to Article 14 based upon the result of an advance examination on the required amount notified under paragraph (2) or (3), the head of a customs office shall calculate the required amount based upon such result and refund the customs duty, etc. |
| (5) | The result of an advance examination on the required amount notified under paragraph (2) or (3) shall be valid for one year from the date of notification of the result: Provided, That where any event prescribed by Presidential Decree occurs, such as a change in facts or circumstances on which the advance examination on the required amount is based, such result shall be null and void from the date of occurrence of the event. |
| (6) | Except as otherwise provided in paragraphs (1) through (5), the procedures and methods for conducting an advance examination on the required amount and other necessary matters shall be prescribed by Presidential Decree. |
[This Article Newly Inserted on Dec. 19, 2017]
| Article 11 (Certificate of Average Tax Amount) |
| (1) | Where deemed necessary to simplify the refunding business of customs duties, etc. on raw materials for export, the head of a customs office may issue a document certifying the quantity of each item and the average tax amount per unit of the raw materials for export which have been imported each month by a person, at the request of the person who imports raw materials for export (including purchases by local letters of credit, etc; hereafter the same shall apply in this Article and Article 12), as prescribed by Presidential Decree (hereinafter referred to as "certificate of average tax amount"). In such cases, the relevant raw materials for export shall be deemed to have been imported on the first day of the month in which the date of import falls, with regard to applying this Act. |
| (2) | Notwithstanding paragraph (1), the head of a customs office may have any of the following persons, who shall meet the standards determined by the Commissioner the Korea Customs Service, issue a certificate of average tax amount, as prescribed by Presidential Decree: |
| 1. | A person who has imported raw materials for export; |
| 2. | A licensed customs broker (limited to a person who has been entrusted by a person falling under subparagraph 1). |
| (3) | If a person, who has received a certificate of average tax amount from the head of a customs office or a licensed customs broker pursuant to paragraph (1) or (2) 2, or a person, who has issued a certificate of average tax amount pursuant to paragraph (2) 1, has imported goods for purposes other than export, such goods having the same commodity description of ten digits on the schedules of tariff rates under Article 50 (1) of the Customs Act as the raw materials for export described in the certificate of average tax amount, the customs duties, etc. may be refunded only when the customs duties, etc. on the raw materials for export described in the certificate of average tax amount have been refunded. In such cases, the refund amount for each item may not exceed the average tax amount of the raw materials for export described in the certificate of average tax amount for the month in which the goods concerned are imported (if, in the month of import, there is no raw materials for export in the certificate of average tax amount, the average tax amount shall refer to the average tax amount of the raw materials for export described in the certificate of average tax amount for the month in which raw materials for export having the same item name as the relevant goods are imported for the first time retroactively from the month in which the goods concerned are imported). |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 12 (Certificate of Tax Payment on Basic Raw Materials, etc.) |
| (1) | Where raw materials for export have been traded by local letters of credit, etc. (excluding any case to which Article 5 (3) applies), the head of a customs office may issue a document certifying the tax amount paid with respect to the raw materials for export traded after being manufactured or processed (hereinafter referred to as "certificate of tax payment on basic raw materials"), or a document certifying tax amount paid with respect to the raw materials for export which have been traded in the same condition as they are imported (hereinafter referred to as "certificate of divided import tax amount"), as prescribed by Presidential Decree, for the purpose of more effective performance of the refunding business of customs duties, etc. |
| (2) | Notwithstanding paragraph (1), the head of a customs office may have the following persons, who shall meet the standards determined by the Commissioner of the Korea Customs Service, issue a certificate of tax payment on basic raw materials or a certificate of divided import tax amount: |
| 1. | A person who has supplied goods by means of local letters of credit, etc.; |
| 2. | A licensed customs broker (limited to a person who has been entrusted by a person falling under subparagraph 1). |
| (3) | Tax amount certified at the time of issuance of a certificate of tax payment on basic raw materials or a certificate of divided import tax amount under paragraph (1) or (2) shall be based on the calculation method of refund money pursuant to Article 10, and Article 14 (2) and (3) shall apply mutatis mutandis to the examination of the correctness of the tax amount certified. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 13 (Fixed Amount Refund Rates Table) |
| (1) | If deemed necessary to simplify the refund procedure on the customs duties, etc. on export goods under extraordinary production process such as when two or more products are simultaneously produced from one raw material for export and on export goods produced by small and medium enterprises, the Commissioner of the Korea Customs Service may determine and publicly notify a fixed amount refund rates table by each item of the export goods on the basis of the average refund money of the customs duties, etc. or the average paid tax amount on the raw materials for export. |
| (2) | The amount provided in the fixed amount refund rates table pursuant to paragraph (1), shall be regarded as customs duties, etc. paid when the raw materials for export needed for producing the goods concerned were imported, and thus be refunded. |
| (3) | A person who may be eligible for the application of the fixed amount refund rates table under paragraph (1) may ask the Commissioner of the Korea Customs Service to determine and publicly notify the fixed amount refund rates table, as prescribed by Presidential Decree. |
| (4) | If it is deemed inappropriate to apply the fixed amount refund rates table because the refund money in the fixed amount refund rates table is larger or smaller due to changes in the export structure, the import structure of raw materials, tariff rates, and exchange rates, the Commissioner of the Korea Customs Service may suspend the application of the fixed amount refund rates table or may make proper adjustments to all or part of the fixed amount refund rates table and notify the public thereof. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 14 (Application for Refund) |
| (1) | A person who intends to have customs duties, etc. refunded shall apply for the refund to a customs office designated by the Commissioner of the Korea Customs Service within two years from the date on which the goods are offered to export, etc. as prescribed by Presidential Decree: Provided, That where any of the following reasons occurs, he/she may file an application for refund within two years from the date when such reason occurs: <Amended on Dec. 31, 2011> |
| 3. | Collection or voluntary declaration and payment of the refund money or excess refund money under Article 21. |
| (2) | Upon receipt of the application for refund pursuant to paragraph (1), the head of a customs office shall examine the items described in the written application for refund and the matters to be verified under this Act and shall determine the refund money, the correctness of which may be verified after the refund as prescribed by Presidential Decree. |
| (3) | Notwithstanding paragraph (2), the head of a customs office shall examine the correctness of the refund money before the refund, in cases determined by Ordinance of the Ministry of Economy and Finance where it is deemed inappropriate to conduct the examination after the refund because of a risk of an excessive refund. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 15 (Use of Computer Processing System) |
| (1) | The head of a customs office may order a report, payment, application, etc. under this Act (hereinafter referred to as "electronic report, etc.") or notify, deliver a tax payment notice, deliver, issue, designate, approve, etc. (hereinafter referred to as "electronic delivery") by using a computer processing system as determined by the Commissioner of the Korea Customs Service. |
| (2) | When an electronic report, etc. is made pursuant to paragraph (1), the head of a customs office may have relevant documents submitted by using the computer processing system, as determined by the Commissioner of the Korea Customs Service, and may have such submission omitted or made in a simple way. |
| (3) | An electronic report, etc. made pursuant to paragraph (1) shall be regarded as having been received by the customs office at the time when it is entered in the computer processing system designated by the Commissioner of the Korea Customs Service, and an electronic delivery shall be considered to have reached the person requiring the delivery at the time when it is entered in the computer designated in advance by the person requiring such delivery or in the computer processing system designated by the Commissioner of the Korea Customs Service upon an application of the person requiring the delivery. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 16 (Payment of Refund Money) |
| (1) | Notwithstanding Article 17 of the National Finance Act, the amount of customs duties, etc. refundable under this Act shall be paid by the Bank of Korea incorporated under the Bank of Korea Act (hereinafter referred to as the "Bank of Korea") with funds from the revenue account under the control of the head of the customs office who determines the payment of refund money. In such cases, procedures for payment shall be prescribed by Presidential Decree. |
| (2) | If the balance of the revenue account under the control of the head of the customs office under paragraph (1) is insufficient, the Commissioner of the Korea Customs Service may request the Bank of Korea to make an adjustment between the revenue accounts under the control of the head of the customs office, as prescribed by Presidential Decree. |
| (3) | Notwithstanding paragraph (1), the head of the customs office shall defer the payment of the refund money determined upon an application for refund by an enterprise for lump-sum payment of customs duties, etc. until the date when a settlement of accounts pursuant to Article 7 (1) is made for each lump-sum payment term to which the relevant refund money determination date belongs. |
| (4) | If an applicant for refund is liable to pay any of the following customs duties, etc. to a customs office, the head of the customs office may appropriate the refund money determined for the following amounts in the following order; and shall pay the remainder after such appropriation to the relevant applicant: <Amended on Dec. 31, 2011; Dec. 27, 2016; Dec. 31, 2018> |
| 1. | Delinquent customs duties, etc. (including value-added taxes), additional charges, additional taxes, and expenses for disposition on delinquency; |
| 2. | The following amounts: |
| (a) | The amount which should be collected, which is the difference between the amount of customs duties declared and that paid based on the provisional dutiable value pursuant to Article 28 (4) of the Customs Act and the amount of customs duties payable based on the final dutiable value; |
| (b) | The amount which should be collected pursuant to Article 21 (1) and (2). |
| (5) | The head of a customs office shall appropriate the refund money determined for the amount provided for in paragraph (4) 2, upon a request from the applicant for refund. In such cases, the amount of customs duties payable shall be deemed paid on the date the applicant for refund files a request for such appropriation. <Newly Inserted on Dec. 27, 2016> |
| (6) | The Commissioner of the Korea Customs Service may establish methods and procedures necessary for appropriation of customs duties, etc. under paragraphs (4) and (5). <Newly Inserted on Dec. 31, 2018> |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 17 (Restriction on Refund) |
| (1) | Notwithstanding Article 9, if deemed necessary to promote the use of domestically produced raw materials for the production of export goods, the refund may be restricted as prescribed by Presidential Decree. |
| (2) | Goods subject to restrictions pursuant to paragraph (1), and the rate of restriction shall be prescribed by Ordinance of the Ministry of Economy and Finance. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 18 (Collection of Customs Duties, etc. where Goods Are Used for Any Purpose other than That Specified) |
| (1) | Where the goods for which the customs duties, etc. are refunded are found to have been used for any purpose other than that prescribed in subparagraph 2 of Article 4 within the period determined by the Commissioner of the Korea Customs Service, which shall not exceed three years after the date on which the goods are offered for the concerned purpose, the head of a customs office shall immediately collect the refunded customs duties, etc. from the person who has used the goods for any purpose other than such purpose: Provided, That when the goods are destroyed due to unavoidable circumstances such as a disaster, or are destroyed with the prior approval by the head of the customs office, the same shall not apply. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 19 (Reduction in Tax Rates of Customs Duties, etc. in place of Refund) |
| (1) | With respect to goods imported for use mainly in the production of goods offered for export, etc., tax rates of customs duties, etc. may be reduced taking the ratio offered for such export into consideration. |
| (2) | The goods subject to a reduction in tax rates of customs duties, etc. and the tax rates thereof under paragraph (1) shall be prescribed by Presidential Decree. |
| (3) | With respect to goods for which tax rates of customs duties, etc. are reduced pursuant to paragraph (1), the lump-sum payment and refund of the customs duties, etc. under this Act shall not be granted. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 20 (Custody and Submission of Documents, etc.) |
| (1) | All documents designated by the Presidential Decree from among the documents concerning the refund of the customs duties, etc. under this Act shall be kept for a period designated by the Presidential Decree, which shall not exceed five years after the date of the application for the refund, etc. |
| (2) | The documents under paragraph (1) may be kept in the form of microfilm, optical disks or other media for preservation of data, as determined by the Commissioner of the Korea Customs Service. |
| (3) | If deemed necessary for the examination as to the appropriateness of refund money pursuant to Article 14, the Commissioner of the Korea Customs Service or the head of a customs office may ask a person who receives the refund, a person who imports raw materials for export, a person who offers such raw materials for export by local letters of credit, etc. and other related persons to submit the documents under paragraph (1) and other related data. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 21 (Collection of Excess Refund Money, etc.) |
| (1) | Where the refund money paid pursuant to Article 16 falls under any of the following subparagraphs, the head of a customs office shall collect the relevant refund money or excess refund money from the person who has received the refund of customs duties, etc. pursuant to Article 47 (1) of the Customs Act (including any person who has been issued with a certificate of tax payment on basic raw materials or a certificate of divided import tax amount; hereafter the same shall apply in this Article): |
| 1. | Where the refund has been made in excess of the amount that shall be refunded under this Act; |
| 2. | Where the excess customs duties, etc. is certified on the certificate of tax payment on basic raw materials, etc. under the Article 12, and the relevant certificate of tax payment on basic raw materials, etc. has been used for the refund, etc., thereby making it impossible to correct or reissue it; |
| 3. | Where the customs duties, etc. have already been refunded without loading onto a ship or an aircraft: Provided, That where the loading onto a ship or an aircraft was done before the collection of the amount in question, the same shall not apply; |
| 4. | Where the refund is received according to the fixed amount refund rates table with respect to the goods to which the fixed amount refund rates table under Article 13 (1) does not apply. |
| (2) | When the refund money or excess refund money is collected pursuant to paragraph (1), the amount calculated based on the interest rate prescribed by the Presidential Decree shall be added to the refund money or excess refund money for the period from the day following the day of refund to the day when the collection is determined: Provided, That where the refund money or excess refund money is collected due to the difference between the amount of customs duties declared and paid on the basis of the temporary price pursuant to Article 28 of the Customs Act and the determined price, the amount of money calculated based on the interest rate prescribed by the Presidential Decree shall not be added to the refund money or excess refund money. <Amended on Dec. 31, 2011> |
| (3) | When the refund money or excess refund money and the amount added thereto pursuant to paragraphs (1) and (2) are intended to be collected, the details thereof shall be notified in advance by a letter to the person who has received the refund of customs duties, etc. In such cases, Article 118 of the Customs Act shall apply mutatis mutandis. |
| (4) | When a person who has received a refund of customs duties, etc. or a person who has received a notification of settlement of accounts pursuant to Article 7 (1) becomes aware that he/she falls under any of the subparagraphs of paragraph (1) or that a miscalculation in the settlement of accounts has resulted in a shortage of customs duties payable after the notification of the settlement of accounts, he/she may voluntarily report such facts to the head of a customs office as prescribed by the Presidential Decree and pay the refund money, the excess refund money, or the customs duties, etc.: Provided, That any of the following cases shall be excluded: |
| 1. | Where the head of a customs office has notified in writing the details of the collection of the refund money or the excess refund money pursuant to paragraph (3); |
| (5) | When the refund money, excess refund money or customs duties, etc. is paid under paragraph (4), the amount calculated in accordance with the period, interest rate, etc. prescribed by the Presidential Decree shall be added thereto and paid: Provided, That where the refund money, excess refund money or customs duties, etc. is paid due to the difference between the amount of customs duties declared and paid on the basis of the temporary price pursuant to Article 28 of the Customs Act and the determined price, the amount of money calculated according to the period, interest rate, etc. prescribed by the Presidential Decree shall not be added thereto. <Amended on Dec. 31, 2011> |
| (6) | Any person who falls under a case where a refund has been received in excess of the amount that should be refunded under paragraph (1) 1 and therefore has paid the amount added to the excess refund money (hereinafter referred to as "additional amount") under paragraph (2) or (5) may file an application for the payment of any of the following amounts out of such additional amount, within the period specified in the proviso to Article 14 (1). In such cases, Articles 14 and 16 (1), (2), and (4) shall apply mutatis mutandis to the application for payment of the following additional amounts and the payment thereof: <Newly Inserted on Jan. 1, 2014> |
| 1. | In the case of an application for refund for a reason referred to in Article 14 (1) 3, the additional amount equivalent to the refund money; |
| 2. | In the case of having been already refunded for a reason referred to in Article 14 (1) 3, the additional amount equivalent to the refund money. |
| (7) | Where the application for payment under paragraph (6) is related to the additional amount paid for a reason that an excess refund has been received by fraud or other improper means, the head of a customs office may choose not to pay the additional amount. <Newly Inserted on Jan. 1, 2014> |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 22 (Payment of Shortage of Refund Money) |
| (1) | The head of a customs office shall pay the shortage of refund money concerned without delay when he/she learns the fact that the refund money paid pursuant to Article 16 is significantly less than the amount payable pursuant to the provisions of this Act. |
| (2) | When the shortage of refund money is paid pursuant to paragraph (1), the amount calculated based on the interest rate prescribed by the Presidential Decree pursuant to Article 21 (2) shall be added to the shortage of the refund money for the period from the day following the day of the refund to the day when the decision to make up for the shortage is made. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 23 (Penalty Provisions) |
| (1) | A person who has received the refund of the customs duties, etc. by fraud or other improper means shall be punished by imprisonment with labor for not more than three years, or by a fine of not more than five times the amount of the tax refunded. |
| (2) | Any of the following persons shall be punished by imprisonment with labor for not more than three years or by a fine not exceeding 20 million won: <Amended on Jan. 1, 2014> |
| 1. | A person who has prepared a false statement of accounts for the required amount referred to in Article 10 (1); |
| 2. | A person who has obtained, from the head of a customs office or a licensed customs broker, a certificate of tax payment on basic raw materials or a certificate of divided import tax amount under Article 12 (1) or (2) by fraud or other improper means; |
| 3. | A person who is in charge of issuing a certificate of tax payment on basic raw materials or a certificate of divided import tax amount under Article 12 (2) and has issued a false certificate of tax payment on basic raw materials or a certificate of divided import tax amount. |
| (3) | A person who violates Article 20 (1) without justifiable grounds shall be punished by a fine not exceeding 20 million won. |
| (4) | A person who fails to submit documents and other data required by the Commissioner of the Korea Customs Service or the head of a customs office pursuant to Article 20 (3) without justifiable grounds, shall be punished by a fine not exceeding 10 million won. |
| (5) | In the cases of paragraphs (1) and (2), the head of the customs office shall immediately collect the customs duties, etc. refunded. |
[This Article Wholly Amended on Jul. 14, 2011]
| Article 23-2 (Attempts to Commit Offenses, etc.) |
| (1) | Any person who knowingly abets or aids any offense provided for in Article 23 (1) or (2) shall be punished by the penalty with which any principal offense is punishable. |
| (2) | Any person who attempts to commit any offense provided for in Article 23 (1) shall be deemed to commit such offense and punished by the penalty with which such offense is punishable. |
| (3) | Any person who prepares to commit any offense provided for in Article 23 (1) shall be punished by half of the penalty with which any principal offense is punishable. <Amended on Jun. 9, 2020> |
[This Article Newly Inserted on Dec. 15, 2015]
| Article 23-3 (Concurrent Imposition of Imprisonment with Labor and Fines) |
Imprisonment with labor and an fine may concurrently be imposed on a person who commits an offense provided for in Article 23 (1) or (2) considering extenuating circumstances. <Amended on Jun. 9, 2020> [This Article Newly Inserted on Dec. 15, 2015]
| Article 23-4 (Partial Exclusion from Application of the Criminal Act) |
The provisions governing restricted aggravation with respect to concurrent fines under Article 38 (1) 2 of the Criminal Act shall not apply to a person who commits an offense provided for in this Act. [This Article Newly Inserted on Dec. 15, 2015]
| Article 23-5 (Joint Penalty Provisions) |
If the representative of a legal entity, or an agent or employee of, or any other person employed by, a legal entity or an individual commits any offense provided for in Article 23 in connection with the duties of the legal entity or private individual, not only shall such offender be punished, but the legal entity or individual also shall be punished by a fine prescribed in the corresponding provisions, respectively: Provided, That the same shall not apply where the legal entity or private individual has not been negligent in giving due attention or supervision concerning the relevant duties to prevent such offense. [This Article Newly Inserted on Dec. 15, 2015]
| Article 24 (Examination and Disposition) |
[This Article Wholly Amended on Jul. 14, 2011]
ADDENDA <Act No. 5197, Dec. 30, 1996>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 1997.
Article 2 (General Transitional Measures)
Matters in force pursuant to the previous provisions before this Act enters into force, shall be governed by the previous provisions.
Article 3 (Examples of Application Subject to Lump-Sum Payment of Customs, etc.)
Lump-sum payment of the customs duties, etc. pursuant to Article 5 (2) shall apply to the raw materials for export, the import declaration of which is made on July 1, 1997. Article 4 (Examples of Application to Refund of Customs Duties, etc.)
The calculation period on the raw materials for export pursuant to Article 9 (1) shall apply to the raw materials for export, the import declaration of which is made on July 1, 1997. Article 5 (Transitional Measures concerning Drawing Up of Statement of Accounts of Amount Required)
Drawing up of the statement of accounts for the amount required pursuant to Article 10 (1) shall be regarded as if the export declaration is received or offered by a local letter of credit after July 1, 1997 (where a transaction by a local letter of credit is executed more than twice, the first day offered shall be the standard): Provided, That in a case where an applicant for refund fails to calculate the required amount by June 30, 1998, the statement of accounts for the amount required, etc. pursuant to the previous provisions before this Act enter into force may be used. Article 6 (Examples of Application to Payment Suspension of Refund Money)
The payment suspension of the refund money pursuant to Article 16 (3) shall apply to the submitted application for the refund of customs duties, etc. by the lump-sum enterprise of the customs duties, etc., on July 1, 1997. Article 7 (Examples of Application to Collection where Goods Are Used for Any Purpose other than That Specified)
The provisions of Article 18 (1) shall apply to the purpose as prescribed in subparagraph 2 of Article 4 after July 1, 1997. Article 8 (Examples of Application to Custody of Documents)
The provisions of Article 20 (1) and (2) shall apply to the refund-related documents after July 1, 1997. Article 9 (Examples of Application to Collection of Excess Refund Money, etc. and Payment of Shortage of Refund Money)
The provisions of Articles 21 and 22 shall apply to applications for refund after July 1, 1997.
ADDENDA <Act No. 6305, Dec. 29, 2000>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2001.
Articles 2 through 8 Omitted.
ADDENDA <Act No. 7210, Mar. 22, 2004>
Article 1 (Enforcement Date)
This Act shall enter into force three months after the date of its promulgation.
Articles 2 through 16 Omitted.
ADDENDA <Act No. 8050, Oct. 4, 2006>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2007. (Proviso Omitted)
Articles 2 through 12 Omitted.
ADDENDA <Act No. 8233, Jan. 11, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on April 1, 2007.
Article 2 (Application Examples regarding Raw Materials Subject to Refund)
The amended provisions of Article 3 (1) 1 shall apply starting with raw materials for export which is declared for import first after this Act enters into force or traded within the Republic of Korea by means of a local letter of credit, etc. after this Act enters into force. Article 3 (Application Examples regarding Export, etc. Subject to Refund)
The amended provisions of subparagraph 2 of Article 4 shall apply starting with a sales contract or construction contract concluded first after this Act enters into force. Article 4 (Application Examples regarding Lump-Sum Payment Period and Notification of Settlement of Accounts of Customs Duties, etc.)
The amended provisions of the latter part of Articles 5 (2), 7 and 16 (3) shall apply starting with the lump-sum payment period which is terminated first after this Act enters into force. Article 5 (Application Examples regarding Period for Application for Refund)
The amended provisions of the proviso of Article 14 (1) shall apply starting with the revision, correction or rectification made first after this Act enters into force, with respect to the tax amount of customs duties, etc. with regard to raw materials for export. Article 6 (Application Examples regarding Collection of Excess Refund Money, etc.)
The amended provisions of Article 21 (3) and (5) shall apply starting with the cases of collection of excess refund money, etc. collected first after this Act enters into force.
ADDENDA <Act No. 8829, Dec. 31, 2007>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2008.
Articles 2 through 12 Omitted.
ADDENDA <Act No. 8852, Feb. 29, 2008>
Article 1 (Enforcement Date)
This Act shall enter into force on the date of its promulgation. Provided, That ... (Proviso Omitted) ... among the Acts amended pursuant to Article 6 of the Addenda, the amendments to the Acts promulgated before this Act enters into force, but the enforcement dates of which have yet to arrive, shall enter into force on the dates on which the respective Acts take effect. Articles 2 through 7 Omitted.
ADDENDUM <Act No. 10817, Jul. 14, 2011>
This Act shall enter into force on the date of its promulgation.
ADDENDA <Act No. 11131, Dec. 31, 2011>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2012.
Article 2 (Applicability to Application for Refund)
The amended provision of Article 14 (1) 3 shall apply beginning with the first refund money or excess refund money which the head of a customs house collects or an applicant for refund voluntarily declares and pays after this Act enters into force. Article 3 (Applicability to Appropriation for Payment of Customs Duties, etc. in Arrears)
The amended provisions of Article 16 (4) shall apply beginning with the first refund money which the head of a customshouse appropriate for payment after this Act enters into force. Article 4 (Applicability to Exemption, etc. from Collection of Additional Dues)
| (1) | The amended provision of the proviso to Article 21 (2) shall apply beginning with the first refund money or excess refund money which the head of a customs house collects after this Act enters into force. |
| (2) | The amended provision of the proviso to Article 21 (5) shall apply beginning with the first refund money, excess refund money or customs duties, etc. which an applicant for refund voluntarily declares and pays after this Act enters into force. |
ADDENDA <Act No. 12170, Jan. 1, 2014>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2014.
Article 2 (Applicability to Payment of Amount Added to Excess Refund Money)
The amended provisions of Article 21 (6) and (7) shall apply from an application for payment of additional amount filed after this Act enters into force.
ADDENDA <Act No. 13559, Dec. 15, 2015>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2016.
Article 2 (Applicability to Refund of Customs Duties, etc.)
The amended proviso to Article 9 (1) shall begin to apply from the first customs duties, etc., imposed on the raw materials used for goods for export, etc. after this Act enters into force. Article 3 (Applicability to Calculation of Refund Money, etc.)
The amended provisions of Article 10 (4) shall begin to apply from the amount of tax on raw materials used for goods for export, etc. or raw materials for export traded by local letters of credit (applicable only where a certificate of tax payment on basic raw materials is issued pursuant to Article 12), refunded or certified as paid after this Act enters into force.
ADDENDA <Act No. 14466, Dec. 27, 2016>
Article 1 (Enforcement Date)
This Act shall enter into force on January 1, 2017.
Article 2 (Applicability to Allocation of Refund Money)
The amended provisions of Article 16 (4) and (5) shall begin to apply from the amount of tax determined to be refunded after this Act enters into force.
ADDENDUM <Act No. 15226, Dec. 19, 2017>
This Act shall enter into force on July 1, 2018: Provided, That the amended provisions of Article 3 (1) 1 shall enter into force on January 1, 2018.
ADDENDA <Act No. 16105, Dec. 31, 2018>
Article 1 (Enforcement Date)
This Act shall enter into force on July 1, 2019: Provided, That the amended provisions of Article 16 (4) 2 and (6) shall enter into force on January 1, 2019. Article 2 (Transitional Measures concerning Credit-Backed Enterprises)
Notwithstanding the amended provisions of Articles 5, 6, and 8, the previous provisions shall apply to a person who was designated as a credit-backed enterprise pursuant to the former Articles 5 (2) and 6 at the time this Act enters into force until the designated period expires.
ADDENDA <Act No. 17339, Jun. 9, 2020>
This Act shall enter into force on the date of its promulgation. (Proviso Omitted.)