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Free Trade Zones are generally industrial complexes, airports, ports, distribution complexes or freight terminals. Industrial linkage and synergy are considerable in these zones, as they are open both to manufacturing and logistics industries.

Tax benefits are available in varying scopes depending on the type of industries and size of investment. As these zones are legally considered to be outside KoreaĄŻs customs territory, customs duties on foreign goods and certain domestic goods entering them are deferred, and zero-rated VAT is applied. Manufacturers importing raw materials and exporting finished goods do not need to go through complicated drawback procedures.

Free Trade Zone administration agencies provide a comprehensive administrative portal processing all essential formalities including reporting investment to authorities, obtaining permission to move into the zone, permission to construct a plant and applying for import and export licenses.

Providing lands and plants at extremely affordable rates for long-term lease, free economic zones offers conditions that are especially advantageous for foreign companies in export-oriented manufacturing, logistic businesses, including warehousing, loading and unloading and packaging, and wholesale import and export business. These zones are more particularly suited for large-size foreign-invested companies, combining manufacturing and logistics operations.

 

Free Trade Zones Designated to Date

 

Free Trade Zones are distinguished into those based in industrial complexes, on the one hand, and those developed in the hinterlands of airports and ports, on the other. There are currently 4 industrial complex-based Free Trade Zones, located respectively in Masan, Iksan, Gunsan and Daebul, and 5 airport or port hinterland Free Trade Zones, each located in Incheon IntĄŻl Airport, Port of Gwangyang, Port of Incheon and Port of Gunsan (designation forthcoming). Meanwhile, distribution complexes or freight terminals can also be designated as Free Trade Zones.

Administration of free economic zones are overseen by three different authorities, in charge of managing zones falling into their respective specialty areas; the Ministry of Industry, Commerce and Energy for those based in industrial complexes, the Ministry of Construction and Transportation for those in airport hinterlands, and the Ministry of Maritime Affairs and Fisheries for those in port hinterlands.

 

 

 

 

Masan Free Trade Zone

The MFTZ, according to the special law[Law for Establishment of Free Export Zone], firstly was established in Korea in January of 1970 to contribute to the national and local economy through attracting more foreign investment which focuses on export promotion, employment expansion and technical improvement. 

The Masan FTZ also has a better investment climate, which has brought much more foreign companies in the industrial complex.

The Masan FTZ provides resident companies with excellent administrative businesses - report on foreign investment, permission on new factory buildings and export-import approval - which is under the direct control of the MFTZ Administration Agency, an affiliate of Ministry of Commerce, Industry & Energy.
In case of foreign investment, a wide range of benefits - low rents and supporting facilities, tax incentives and a revision of related laws are given for convenience of export-import activities.

The Masan FTZ had been operated as "Free Export Zone" focused on manufacturing.
Since July.13.2000 it has been operating as "Free Trade Zone" added international trade, distribution, information processing and service according to [Free Trade Zone Act].

 

E-mail : mftz@mocie.go.kr  

FAX : 82-55-294-2665  

Tel : 82-55-294-2773/2666

 

 

 

  Copyright By :  Kish Trade Promotion Center  2002