IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 05 Jun 2014 | Removal date: open ended
Still in force

Financial grant

On 5 June 2014, Ministry of Agriculture, Food and Rural Affairs (MAFRA) designated sorghum, potato, sweet potato, and Korean native calf for the items that are eligible for "FTA compensation for income loss" in 2014. Furthermore, local calf famers are eligible for "compensation for closure". The compensation will be allocated until the end of the year following the applications from the farm. The budget for this measure is KRW 100 billion KRW (ca. 95 million USD). The maximum amount of "compensation for income loss" is 35 million KRW (ca. 33,000 USD) for individual farmer and 50 million KRW (ca. 47,000 USD) for corporation.
 
Through the "FTA compensation for income loss", 90% of a price decline is reimbursed by the government when all of following three requirements are met;
1) Total import quantity exceeds the criteria (Olympic average of 3 years out of last 5 years (2008-2012)); 
2) Import quantity of the FTA Member State exceeds the criteria (Olympic average of 3 years out of last 5 years (2008-2012) * coefficient for import damage); and 
3) Average price drops below the criteria (Olympic average of 3 years out of last 5 years (2008-2012) *0.9)
 
In the "compensation for closure", three years of net gain is being preserved by the government when the farmers cultivating or breeding the items eligible for 'compensation for income loss' want to close their farms and meet one of the following requirements: 
1) High investment cost for cultivation or breeding and difficult to collect the investment upon closure; or 
2) Difficult to gain short-term profit because it takes 2 years or longer to cultivate or breed; or 
3) Other needs to provide the compensation for closure

Both compensations are based on the "Special Act On Assistance To Farmers,Fishermen, etc. Following the Conclusion of Free Trade Agreements", which was passed March 2004. 
 
 

AFFECTED COUNTRIES

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TABLE
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AFFECTED SECTORS AND PRODUCTS

011 Cereals
1007 Grain sorghum.
100790 Other
015 Edible roots & tubers with high starch or inulin content
0701 Potatoes, fresh or chilled.
070190 Other
0714 Manioc, arrowroot, salep, Jerusalem artichokes, sweet potatoes and similar roots and tubers with high starch or inulin content, fresh, chilled, frozen or dried, whether or not sliced or in the form of pellets; sago pith.
071410 Manioc (cassava)
071490 Other
211 Meat & meat products
0201 Meat of bovine animals, fresh or chilled.
020120 Other cuts with bone in
020130 Boneless
0202 Meat of bovine animals, frozen.
020220 Other cuts with bone in
020230 Boneless

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