Due to the Canada – Korea agreement (CKFTA), there has been increased opportunity for Canadian companies selling to South Korea. Virtually all Canadian origin goods - from pharmaceuticals and cosmetics to plastic products and machinery - can be sent from Canada for duty free clearance in Korea.
International shipments to Asia have grown exponentially and the CKFTA will contribute to further growth. The free trade agreement with Korea is Canada’s first free trade agreement in Asia helps Canadian businesses and online sellers reach their Korean customers.
This post provides a deeper dive and explores of the main elements of international shipping between Canada and Korea
Disclaimer: The information in this post and all Jet Worldwide content is for general information only
Low cost shipping possibilities for parcels and online orders to Korea from Canada with duty free clearance via CKFTA free trade agreement
Canada post is the preferred option for individuals sending personal items to South Korea.
Shipping small parcels to South Korea
Shipping South Korea from Canada FedEx and UPS
FedEx and UPS are North America's largest carriers and offer, along with DHL, air express shipping services to South Korea from Canada. FedEx and UPS shipping Korea from Canada options include
Shipping to South Korea via Purolator
Purolator Courier is a leading Canadian domestic carrier and offers international shipping options from Canada to Korea via carrier partners- such as UPS.Purolator is a division of Canada Post.
The default option for shipping internationally from Canada is delivery duty unpaid. Common carriers use the term EXW which essentially assigns all import related costs (duty, taxes, and other fees) to the receiver/ importer. Shippers from Canada can choose to pay the import fees on behalf of the receiver via a Delivery Duty Paid (DDP) options that many carriers offer. Useful information regarding shipping terms for packages and online orders.
The disadvantage of paying import fees on behalf of the receiver is that the bulk of the import fees are often from a value added tax that the importing business may otherwise be able to claim back.
Goods shipped to South Korea must be accompanied by an invoice for customs or other supporting documents.Most import aspects include the complete address of the receiver, a correct phone number and exact description and value of each item being sent.
Duties are assessed on a Cost-Insurance-Freight (CIF) basis. The main mode of customs value assessment is the transaction value method. Other methods under the WTO appraisement hierarchy may be used if there are doubts about Korean Customs valuation methods on the stated value.
A Value Added Tax rate of 10 percent is applied on imports based on customs value plus duties.
The “Deminimis Value” in South Korea – or the value of shipments that can enter the country free of duty and tax – is $150 USD. However, Korean customs is very strict in screening such shipments. International shipments sent to Korea must have an accurate consignee address (including telephone number and email) and concise description of the item being imported.
International Shipments to Korea between $150 USD and $2,000 USD
Informal Entry Import to Korea
Shipments valued from US$100.00 to US$2,000.00 including cost, declared value, and freight (CIF) are granted express clearance. However, shipments of restricted commodities and shipments with insufficient descriptions or other discrepancies are often delayed and require an explanation letter prior to clearance.
International Shipments to Korea valued over $2,000 USD
Formal Entry. To expedite Customs clearance, shipments valued greater than US$2,000.00 require an explanation letter from the consignee explaining the purpose of the import as well as the content of the shipment. This procedure is applicable to all courier companies importing shipments to Korea.
Items that do not qualify for duty free Canada origin are subject to duty rates that averages between 6% (for jewelry) and 13% for fashion items.
It is important to check with the consignee to ensure they have the necessary licensing before sending your international shipment to South Korea. An example of restricted items include:
Most Favoured Nation (MFN) tariff rates are generally applicable for good traded between South Korea and Canada. Goods that meet the Canada-Korea Free Trade Agreement(CKFTA) rules of origin can benefit from preferential duty free import. The MFN tariff rates of Canada and Korea apply to goods that do not meet the rules of origin (non-originating goods) under CKFTA.
To qualify for preferential treatment of Canadian origin goods, the shipment must be accompanied by supporting paperwork that includes a certificate origin. A CKFTA certificate of origin must be prepared by the exporter and be presented upon import in South Korea.
The necessary information for a CKFTA certificate of origin include:
The declarative statement - with an authorized signature - should include the following elements:
Common carrier Shipping options from South Korea to Canada include Korean Post (regular parcel post options and Express Mail Service/ EMS), Jet DHL and North America's mega carriers FedEx and UPS.
FedEx and UPS air options for shipping Canada from South Korea include:
Consignments imported from South Korea to Canada are subject to duty and taxes. Most imports valued under CAD 20 can be cleared duty-free and tax-free. Shipments under CAD 3 300 can be imported under Courier Low-Value Shipment (CLVS) processes.
Consignments containing Korean origin goods may benefit from preferential duty free entry under the CKFTA free trade agreement (as discussed in other sections of this blog).
Contact Jet’s logistics team to get an estimate of import fees
Common import fees for consignments shipped via air to Canada from Korea can include duty, taxes and entry preparation fees.
The value for duty amount for all of Canada's free trade agreements (including from Korea under CKFTA) for which the proof of origin / certificate of origin is waived was changed to $3,300 CAD in July 2020. This change was made to harmonize the regulations with the new NAFTA/ CUSMA.
For imports not exceeding $3,300 to Canada, the requirement for proof of origin is waived. The requirement on the importer to maintain records (for example, commercial invoice and B3) applies even if the CBSA does not require a certification of origin or if a requirement for a certification of origin has been waived.
Jet Worldwide gives access to all companies seeking shipping quotes between South Korea (and the APAC region) and Canada for parcels pallets, and online orders. For a quote for shipping online orders, provide details including shipping volume, item(s) being shipped, average value and weight of each parcel. The more details the better :).