The Office of the U.S. Trade Representative recently requested the first-ever consultations under the U.S.- Korea Free Trade Agreement over concerns that Korea is not complying with the agreement’s provisions on competition-related matters.

According to a USTR press release, KORUS article 16.1.3 states that a party in an administrative hearing related to competition must have a reasonable opportunity to review and rebut the evidence and any other collected information on which the determination may be based. However, USTR states, some competition hearings held by the Korea Fair Trade Commission have denied these rights to U.S. parties. USTR adds that recently drafted amendments to Korea’s “Monopoly Regulations and Fair Trade Act” do not rectify the problem, address U.S. concerns, or comply with KORUS obligations.

USTR is therefore seeking changes necessary to meet these obligations while protecting business confidential information and other appropriate materials from disclosure to third parties. However, press sources note that the KORUS competition provisions are not subject to dispute settlement under the agreement.

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