UK-Republic of Korea Free Trade Agreement: conclusion summary

Q: 1. Introduction

The United Kingdom and the Republic of Korea ( RoK ) have concluded negotiations on an upgraded free trade agreement ( FTA ). This builds upon our existing agreement, carried over from the European Union in 2021. Through this upgraded agreement, the UK has future-proofed its trading relationship with an important strategic partner in the Asia-Pacific. The FTA secures key market access and delivers for British business, making trade with the RoK faster, cheaper and more predictable. This document explains what has been agreed, with chapter summaries outlining terms. Work is continuing to finalise the legal text after which the FTA will be formally signed by UK and Korean ministers. Thereafter, and subject to fulfilling both countries’ domestic processes, including UK parliamentary procedure, the FTA will enter into force.

Question 1

1. Introduction

Accepted Answer

The United Kingdom and the Republic of Korea (RoK) have concluded negotiations on an upgraded free trade agreement (FTA). This builds upon our existing agreement, carried over from the European Union in 2021.

Through this upgraded agreement, the UK has future-proofed its trading relationship with an important strategic partner in the Asia-Pacific. The FTA secures key market access and delivers for British business, making trade with the RoK faster, cheaper and more predictable.

This document explains what has been agreed, with chapter summaries outlining terms. Work is continuing to finalise the legal text after which the FTA will be formally signed by UK and Korean ministers. Thereafter, and subject to fulfilling both countries’ domestic processes, including UK parliamentary procedure, the FTA will enter into force.

Question 2

2. The strategic case for the upgrade FTA with the RoK

Accepted Answer

Securing sustained economic growth is the number one mission of this government. Expanding trade and unlocking new opportunities for UK business is essential to delivering our plan for growth.

The RoK is the 12th largest economy in the world^{[footnote 1]}. Its import market is projected to grow by 26% by 2035, driven by a rising middle class^{[footnote 2]}. This presents a significant opportunity for UK exporters of goods and services to tap into one of Asia’s most dynamic and forward-looking economies.

Since the original agreement with the RoK entered into force in 2011, our trading relationship has strengthened, increasing by 32% in the last decade and reaching £15.8 billion in 2024^{[footnote 3]}. This growth is set against the backdrop of ever-closer ties, including the 2023 Downing Street Accord, which elevated bilateral relations to a Global Strategic Partnership. This was accompanied by a commitment of £21 billion in Korean investment into the UK, including in the infrastructure and renewable energy sectors, supporting over 1,500 highly skilled jobs across the country^{[footnote 4]}.

This built on an established strong relationship, already underpinned by growing investment in UK Industrial Strategy sectors, such as financial services^{[footnote 5]} and digital technologies^{[footnote 6]}.

As well as signalling UK commitment to a strategically vital part of the world and the international rules-based system, the FTA allows us to address aspects of the trading relationship. Chief among them were securing continued preferential tariff access for British business and introducing new and modernised provisions, including on digital trade and services market access.

Question 3

3. Main benefits of the upgrade FTA

Accepted Answer

3.1 Certainty for British business and British exports

New rules of origin have secured continued and permanent tariff-free access across 98% of RoK tariff lines, delivering certainty and predictability for UK exporters: a direct response to the needs of British industry. The FTA ensures that the £2 billion in UK goods exports at risk of additional duties can continue to benefit from reduced tariffs^{[footnote 7]}. This outcome permanently safeguards market access and reinforces the ability of British business to sustain and expand their presence in one of Asia’s most advanced economies.

The FTA provides a stable footing for new market entrants and established exporters to trade goods with the RoK. It ensures manufacturers in key Industrial Strategy sectors like life sciences and automotives – including companies such as GSK and Bentley – remain competitive in the RoK’s market.

Leading UK employers and Business Representative Organisations, including Diageo and the Society for Motor Manufacturers and Traders (SMMT), have welcomed the upgraded FTA as a critical measure to protect the exports of British goods and the skilled jobs they sustain. By locking in long-term market access and removing uncertainty, the UK has reinforced its commitment to supporting British business and export-led growth.

3.2 Delivers opportunities for the UK’s world-leading services sectors

Services are a cornerstone of the UK’s Industrial Strategy and a global competitive strength – the UK is the world’s second-largest exporter of services^{[footnote 8]}. This advantage is reflected in our bilateral relationship with the RoK, where bilateral trade in services has grown by 64% over the past decade^{[footnote 9]}.

Recognising the RoK’s expanding services market, we sought modernised arrangements that reflect today’s economy and unlock future growth. The new FTA delivers on that ambition. By reducing barriers and enhancing competitiveness for UK firms operating in the RoK, DBT modelling indicates UK services exports could increase by £400 million annually in the long term. Deloitte, one of the UK’s leading professional services firms, has welcomed the upgraded arrangements as a valuable step forward for the UK’s services sectors.

In 2024, UK financial and insurance exports to the RoK reached £1.1 billion^{[footnote 10]}. The FTA has secured unprecedented commitments, ensuring the ability for UK insurers to provide a range of specialist insurance products to Korean clients, reinforcing London’s position as a global risk hub. These changes have been welcomed by industry stakeholders like the Association of British Insurers (ABI). Additional commitments on financial data localisation and publication of guidance on domestic data regulations will provide UK firms with greater certainty and operational clarity.

Ease of doing business was a priority throughout negotiations. The agreement simplifies market entry for British service suppliers and investors by improving access to critical information and reducing administrative burdens. Ambitious regulatory commitments streamline licensing and authorisation processes, eliminate unreasonable fees, and enable electronic payments. Ambitious business mobility commitments are included which lock in commitments on transparent visa information, timely processing, and temporary stays, as well as the RoK’s best-ever commitments on the number of UK occupations that can enter the RoK market under contractual service supplier and independent professional routes. Together, these commitments support long-term certainty for UK professionals to travel and supply services in the RoK.

3.3 Delivers for the digital future

With over 70% of services trade between the UK and the RoK now conducted digitally^{[footnote 11]}, the landscape of bilateral trade has evolved significantly since the original agreement. This shift has opened new and evolving routes into the RoK’s market that will now be secured and supported through a dedicated digital trade chapter. Building on our global leadership in digital commerce, this new chapter underscores the government’s commitment to supporting British business to thrive within a technology-driven trading environment.

Among the benefits, we have delivered strong commitments on preventing unjustified data localisation requirements; these provide clarity on how data can move freely between the UK and the RoK and ensure that this becomes easier for business over time. Clearer and more transparent digital regulations will reduce compliance burdens and make it simpler for companies to innovate and expand. Organisations such as techUK and EY have welcomed the digital provisions in the FTA and their contribution to digital service trade.

Importantly, we have agreed shared principles for developing and using artificial intelligence (AI) responsibly, as well as commitments that promote and improve compatibility and interoperability of AI governance and policy frameworks. In practice, this means reducing unnecessary barriers so that the UK’s and the RoK’s businesses can use each other’s technology more easily and at lower cost. By strengthening cooperation with the RoK’s world-leading AI sector, the UK is delivering on its National AI Strategy and showing its ambition to lead global conversations on safe, fair and innovative AI.

3.4 Reduces administrative burden and costs for UK businesses

Before negotiations, businesses were clear: tackling administrative burdens and costs were essential for unlocking the full potential of the bilateral trade relationship. This deal succeeds through delivering measures that make doing business in the RoK faster, cheaper and more predictable. The commitments will make it easier than ever for exporters across the UK to service the RoK’s growing appetite for iconic British brands and goods.

The FTA enhances transparency around customs processes and promotes the provision of paperwork electronically and in English. Alongside this, we have secured increased publication of the RoK’s regulations in English, further helping UK firms to understand and comply with local law – a significant stakeholder ask. These administrative changes are of particular value to small and medium-sized enterprises (SMEs), which account for over 99% of businesses in the UK^{[footnote 12]} and which are under-represented in global trade, in part due to difficulty overcoming non-tariff barriers. SMEs also gain from a dedicated chapter that signposts benefits and promotes cooperation on issues such as access to trade finance.

We have also secured commitments on trade digitalisation, helping to lower costs and open up the RoK’s market to UK business – a particular benefit when trading with a partner beyond our immediate doorstep. The new agreement will help facilitate the transition to digital border processes, making it easier for businesses to trade using e-documents like e-invoices and e-contracts. This not only streamlines operations but also reinforces the UK’s commitment to advancing digital trade standards, the global adoption of which could increase UK gross domestic product (GDP) by up to 0.9%^{[footnote 13]}.

The FTA also includes dedicated provisions to promote faster and more predictable clearance processes for the release of goods, which is particularly important for perishable items. These changes have been welcomed by Salmon Scotland, the voice of the Scottish salmon sector. These provisions aim to ensure clearance within 48 hours, supporting smoother cross-border operations and reducing the risk of products rotting at the border while they wait for release. Furthermore, the updated agreement provides greater certainty for agri-food traders by improving the transparency, communication, and timeliness of sanitary and phytosanitary (SPS) market access processes. All Korean agri-food products will continue to have to comply with our SPS standards and wider import requirements to be placed on the UK market.

3.5 Supply chain resilience

In today’s global economy, supply chains are more complex, interconnected, and exposed to disruption than ever before. The FTA addresses these challenges in several ways.

There are updated rules that simplify how businesses prove where their products come from, reducing paperwork and speeding up processes. The agreement also enables greater diversification across key sectors, such as automotive and pharmaceuticals, by allowing more flexibility in sourcing components of products from other countries. This can support UK businesses to take greater advantage of the global supply chains available, making it easier to establish more resilient and flexible bases of supply. These measures have been welcomed by the likes of GSK and SMMT.

A dedicated Supply Chains Cooperation chapter – a first for any UK FTA – allows the UK government to support businesses by identifying and connecting them with new industry partners in the RoK. This will help them diversify sources of raw materials and critical manufacturing inputs. The chapter also encourages collaboration in key sectors, building shared capacity to strengthen supply chains and respond to future challenges.

In addition, the deal supports the circular economy by allowing goods to move back and forth between both parties more smoothly. Goods that are repaired or modified before being re-exported to the RoK will no longer face customs duties or tariffs, encouraging more manufacturing and servicing activity to take place in the UK. We have agreed that import restrictions on used goods will not be applied to UK remanufactured goods, thereby removing barriers and supporting businesses as they transition to more sustainable trade.

3.6 Expanded government procurement opportunities

The FTA provides access to government procurement opportunities in Sejong City, the RoK’s administrative capital. This is the first time the RoK has offered such access to an international partner. Sejong City is a rapidly developing hub with ambitious infrastructure plans, procuring on average £46.2 million worth of goods and services annually^{[footnote 14]}. This opens up new opportunities for UK transport, education, culture and digital firms.

Under the agreement, UK advertising agencies and media companies can now also compete for Korean government contracts in advertising services. This sector represents an average annual procurement value of £86.2 million^{[footnote 15]}. Furthermore, the deal opens doors to new service areas, including taxation.

To make bidding easier, the RoK will publish certain procurement notices in English and work to improve the accessibility of its e-procurement platform. These changes can help UK businesses find, bid for, and win contracts more easily.

3.7 Strengthening the strategic relationship with an influential partner in the Asia-Pacific

This deal is underpinned by a strong economic partnership, deepened by the 2023 Downing Street Accord. By strengthening ties with the RoK, we have reinforced our strategic presence in regional supply chains and innovation networks, ensuring long-term economic opportunities within the Asia-Pacific.

Beyond commerce, the agreement embeds values of fairness and sustainability through collaboration on gender equality, workers’ rights and environmental protection, underscoring the depth and breadth of this strategic relationship. Through establishing cooperation mechanisms on issues like anti-corruption, regulatory practice and consumer protections, the agreement also works to promote the safe and transparent regulation on which modern trade depends.

Finally, the FTA builds on the strong momentum of the UK’s ambitious Trade Strategy. Following deals with the EU, India, and the United States already this year, this upgraded agreement reinforces our commitment to forging modern partnerships that drive growth, innovation and resilience.

Question 4

4. Chapter summaries

Accepted Answer

The upgraded agreement builds on the strong foundations of the UK-RoK Trade Continuity Agreement (TCA). Following stakeholder consultations, the UK and the RoK agreed an approach focused on modernising and enhancing specific areas where there was clear demand for improvement. Chapters not explicitly listed for upgrade have been retained in their existing form, as they were assessed to already provide a comprehensive scope of commitments.

4.1 Trade in goods

Rules of origin

This chapter and its annexes set out the criteria that a good must meet, along with the necessary compliance documentation, to be recognised as originating and benefit from the preferential tariffs agreed under this deal. The rules of origin included in this chapter are more facilitative, future-proofed to support existing trade, and could allow for greater flexibility in sourcing components from third countries for sectors such as processed food, automotive, and pharmaceuticals. At the same time, the chapter preserves origin requirements for primary agricultural products, safeguarding the interests of British farmers.

The chapter has also been upgraded to enable traders to export goods to the RoK via distribution hubs without losing access to tariff preferences. In addition, updated origin procedures simplify how businesses demonstrate that their products qualify, reducing paperwork and accelerating customs processes.

Customs procedures

The changes to this chapter will improve trade facilitation by simplifying customs procedures and reducing the administrative burden for traders. It will ensure that customs processes are more efficient and accessible, including through reduced data requirements for documentation and the introduction of provisions for electronic payment of duties. These measures will help streamline border procedures and support smoother cross-border trade.

The RoK has agreed to publish customs-related laws, regulations and procedures online in English, to the extent possible and practicable. This will provide traders with greater clarity and transparency about import and export requirements, including details such as enquiry points, customs office operating hours, and procedures for correcting errors in customs transactions.

To provide greater certainty for businesses, the chapter also includes commitments on the treatment and release of goods, including perishable items. These provisions aim to ensure clearance within 48 hours, promoting timely and predictable clearance processes and helping traders understand how their goods will be handled at the border and reducing delays.

Together, these commitments will support more efficient trade flows, reduce costs for businesses, and encourage greater participation in international trade. This chapter, alongside other goods-focused provisions in the agreement, will help unlock new opportunities for UK exporters and importers.

Sanitary and phytosanitary (SPS) measures

The upgraded SPS chapter reflects the modern context in which both countries’ SPS systems operate. It will provide greater certainty for UK businesses by enhancing the transparency, communication and timeliness of SPS market access processes. It includes an upgraded article on Adaptation to Regional Conditions, which will help maintain trade flows and facilitate the safe movement of goods where disease or pest outbreaks are present but safely managed.

The UK and the RoK have also agreed to new provisions on audits, certification, import requirements, and the exchange of information. These commitments will promote greater transparency and support timely evidence-based decision-making, helping traders navigate SPS market access processes with more confidence.

The chapter includes an expanded article on animal welfare, which represents the RoK’s most comprehensive language on this issue in any trade agreement to date. It also includes the RoK’s first-ever commitment on anti-microbial resistance in a free trade agreement, underlining the shared importance both countries place on public and animal health. These provisions will strengthen cooperation and information exchange on these globally important issues.

Together, these commitments will help work towards reducing unnecessary barriers to trade, while protecting the UK’s regulatory autonomy to set our own independent standards, ensuring the UK can continue to uphold our high level of protection for human, animal and plant health.

Government procurement

The UK and the RoK have agreed to an upgraded procurement chapter that expands market access and improves transparency for UK businesses. For the first time, the RoK has offered procurement access to Sejong City – its new administrative capital – to an international partner. This represents a significant opportunity for UK companies, particularly in infrastructure, education, culture, and urban development, that could be worth up to £46.2 million annually^{[footnote 16]}.

Sejong City is expected to become a major procurement hub, with plans to invest in world-class infrastructure. As a certified ‘smart city’, Sejong plans to develop autonomous public transport, smart education systems, and pollution monitoring services. These initiatives will open up new public contract opportunities for UK firms in sectors ranging from transport and technology to education and environmental services.

The chapter also secures new reciprocal access for UK companies to bid for services contracts in the RoK, including taxation services, translation and interpretation services, and full coverage of advertising services. These commitments will be beneficial for UK professional and business services providers, who will now be able to compete for contracts with the legal protections provided by the agreement.

To make it easier for UK businesses to participate in Korean procurement, the chapter includes provisions promoting the use of electronic means. This includes a commitment to publish procurement notices on a single online portal, helping businesses easily locate relevant opportunities. The RoK has also committed to publishing procurement summary notices, primarily in English, further improving accessibility.

The UK and the RoK have also agreed to cooperate on improving the accessibility of each other’s e-procurement platforms – KONEPS in the RoK and the Find a Tender Service in the UK – ensuring that businesses on both sides can engage more easily with public procurement markets.

Together, these commitments will help unlock new opportunities for UK suppliers, improve transparency, and support fair and open competition in public procurement.

Goods Market Access (GMA)

The UK and the RoK have agreed to a strengthened GMA chapter that delivers new benefits for UK manufacturers, exporters, and service providers. The chapter includes a range of first-time commitments from the RoK that will support trade flows, improve transparency, and promote sustainable manufacturing.

The UK has secured tariff-free treatment for goods re-entering the RoK after repair or alteration in the UK. This will support the UK’s manufacturing and aftermarket services sectors by removing duties and customs duties on repaired goods, encouraging more skilled manufacturing activity to take place in the UK, and building on the existing flow of UK-RoK goods sent for repair.

For the first time in any trade agreement, the RoK has agreed to a dedicated article on remanufactured goods. This will ensure that UK remanufactured goods are not subject to the same import restrictions as used goods, helping to distinguish high-quality remanufactured products and supporting industries vital to the circular economy and green transition.

The chapter also includes the RoK’s first-ever commitment on export licensing in an agreement. This provision will improve transparency and provide greater certainty for UK industries that rely on Korean imports, including critical inputs for manufacturing.

In addition, the UK has secured new commitments on temporary admission of goods. This will allow UK businesses to move certain goods into the RoK without incurring tariffs, including enabling luxury car manufacturers to send vehicles for display at showrooms and promotional events.

Together, these commitments will help reduce barriers to trade, support sustainable and high-value manufacturing, and create new opportunities for UK exporters in the Korean market.

4.2 Services and investment

Cross border trade in services (CBTS)

The CBTS chapter will build on the already strong services trade between the UK and the RoK by improving transparency and efficiency of authorisation processes, which can constitute a barrier to supplying a service. We have also agreed clear provisions which ensure that UK services businesses can offer their services across borders without the costly and burdensome need for a physical presence in the RoK.

The chapter will lock in existing levels of market access across services sectors, ensuring long-term certainty for UK suppliers regarding the access they are guaranteed when exporting to the RoK.

This chapter will not compromise the UK’s ability to regulate key public services.

Digital trade

The UK and the RoK have agreed to a dedicated digital trade chapter that reflects the transformation of bilateral trade in recent years. With over 70% of services trade between the UK and the RoK now conducted digitally^{[footnote 17]}, this chapter secures and supports new and evolving routes into the RoK’s market, helping UK businesses thrive in a modern, technology-driven trading environment.

It establishes rules on free and trusted cross-border data flows that provide certainty to businesses, ensuring that they can enter and operate in UK and Korean markets without unjustified data localisation requirements. The UK has secured a standalone article on AI, establishing shared principles for its responsible development and governance. This will promote interoperability and compatibility between systems and affirms UK-RoK cooperation in a globally significant sector.

The inclusion of this article supports the UK’s National AI Strategy and its ambition to shape international standards through collaboration.

The chapter also introduces practical measures that benefit UK businesses operating in the digital space. These include enhanced consumer protections to build trust in online transactions and clearer, more transparent digital regulations to reduce compliance burdens. These provisions will make it easier for companies to innovate, expand, and access new markets.

It also includes commitments on preventing unreasonable or unjustified forced disclosure of source code. The threat of forced transfer of intellectual property such as this can deter UK businesses from entering new markets. Reducing the risks in this way means UK businesses can expand in RoK with greater confidence.

Together, these commitments reflect the government’s ambition to create a safer, more open, and opportunity-rich digital trading environment for UK businesses of all sizes, reinforcing the UK’s position as a global leader in digital commerce.

Investment

The agreement includes a modern investment chapter that will help boost the strong UK-Republic of Korea investment relationship. At the end of 2024, the UK’s international investment in the RoK was £73.8 billion, while the RoK’s international investment position in the UK was £61.1 billion^{[footnote 18]}. The chapter ensures businesses and investors will continue to benefit from guarantees on fair treatment when accessing and operating in the RoK.

A modern and transparent Investor-State Dispute Settlement (ISDS) mechanism will protect investments, providing UK investors with independent legal recourse to resolve disputes if treaty obligations are breached. This chapter includes comprehensive levels of protections for UK investors and their investments, ensuring they receive fair and non-discriminatory treatment, and have their assets protected from expropriation without due compensation, while also protecting the rights of each country to regulate in the public interest.

Telecommunications

This chapter delivers meaningful improvements for UK businesses operating in this sector and represents the RoK’s most ambitious telecommunications agreement, including provisions that it has never agreed to before. It includes an article on international mobile roaming, which further benefits consumers and businesses by promoting cooperation on reasonable and transparent roaming rates. This can prevent consumers suffering from ‘bill shock’ because of a lack of transparency around roaming costs while in the RoK. This will benefit tourists as well as business travellers.

The chapter prevents parties from prohibiting resale of a public telecommunications service and ensures that major suppliers offer resale on reasonable and non-discriminatory conditions. This allows existing suppliers to resell parts of their network or services to non-major suppliers or new entrants and enables easier market entry and expansion for UK providers, supporting effective competition in the market.

Together, these commitments will help create a more open and predictable telecommunications environment, unlocking new opportunities for UK businesses and reinforcing the UK’s position as a global leader in digital and telecoms trade.

Financial services

The strengthened financial services chapter secures both current and improved access to the RoK’s growing financial market. It includes unmatched cross-border commitments allowing UK firms to offer non-life insurance products to Korean customers and new commitments ensuring that UK portfolio managers can manage assets of Korean firms in London. This builds on the £1.1 billion worth of UK financial and insurance exports to the RoK in 2024^{[footnote 19]}, reinforcing the UK’s position as a global leader in financial services. The RoK has agreed to its most ambitious market access commitments for financial services to date, guaranteeing improved certainty to UK firms on access to the Korean market, and supporting business confidence.

For the first time, the RoK has committed to lock in its current domestic rules on the storage and transfer of financial data, preventing more restrictive measures being placed on UK financial services firms in future. The RoK will publish new guidance on its rules governing financial data, giving UK financial services firms greater certainty about the regulatory obligations necessary to operate in the Korean market. This will help reduce compliance risks and support smoother market entry.

Both sides have committed to a high standard of regulatory transparency in financial services. This will ensure that firms have access to clearer and more predictable regulatory information. We have also agreed commitments facilitating bilateral cooperation, including on regulatory supervision, and on the promotion of diversity and sustainable practices in financial services.

The agreement also removes nationality requirements for senior managerial positions and limits requirements for company boards, improving market access and allowing UK financial firms greater flexibility to expand, innovate and compete in the RoK’s growing financial sector.

Entry and temporary stay of businesspersons

The upgraded entry and temporary stay chapter includes a range of new commitments that go beyond the TCA to support the movement of businesspersons between both countries, recognising the vital role this has in facilitating trade, investment and economic growth.

The chapter includes ambitious commitments to minimise administrative burdens and ensure timely visa processing times, making business travel efficient and predictable. These commitments support UK professionals in supplying services and building long-term commercial relationships in the RoK.

In this agreement, the UK has secured the RoK’s best-ever commitments on the number of occupations that can enter the Korean market under the contractual service supplier and independent professional routes. For a range of entry routes and occupations, the RoK has also committed to not impose any numerical limitations on the total number of UK businesspersons entering the country. This provides long-term certainty for UK firms and professionals, ensuring they are not subject to quotas or economic needs testing.

These provisions provide certainty for UK businesses and professionals, supporting commercial engagement and enhancing the UK-RoK economic partnership.

4.3 Thematic chapters

Supply chains

We have agreed to the UK’s first-ever dedicated supply chains chapter in a free trade agreement, marking a major step forward in strengthening economic resilience and strategic cooperation. This chapter is designed to enhance the stability of critical supply chains, particularly in times of disruption, and unlock new opportunities to diversify sources for key inputs across important sectors like advanced manufacturing.

Drawing on lessons from recent global disruptions, the chapter establishes mechanisms for both governments to work together to identify supply chain vulnerabilities, share information, and coordinate responses to supply chain challenges. It promotes deeper government-to-government and private sector collaboration, especially in sectors aligned with the UK’s Industrial Strategy.

The chapter will help businesses connect across borders to identify and source essential inputs – including batteries, medical supplies, and other critical components – while supporting diversification of raw material sources.

Together, these commitments will support supply chain resilience, reduce risk, and create new commercial opportunities for UK businesses in a rapidly evolving global trade environment.

Trade and gender equality

The trade and gender equality chapter is the first of its kind for the RoK. It reflects both countries’ commitment to advancing women’s economic empowerment and ensuring that women can fully benefit from the opportunities created by UK-RoK trade.

The chapter establishes a Committee on Trade and Gender Equality, creating a formal space for cooperation, exchange of best practices, and engagement with women in trade. It includes commitments to review and share policies that support women’s participation in the economy, including access to finance, digital skills development, and leadership opportunities in trade-related sectors.

In addition to the dedicated chapter, gender equality and women’s economic empowerment provisions have been embedded across other chapters of the agreement. These reflect emerging evidence of gender-related impacts and barriers in trade, helping to ensure that gender considerations are integrated into implementation and drive progress over time.

Together, these commitments mark a significant step forward in promoting inclusive trade and supporting a more equitable and opportunity-rich trading environment for women in both the UK and the RoK.

Small and medium-sized enterprises (SMEs)

We have agreed to a dedicated SMEs chapter that recognises the vital role SMEs play in both economies, accounting for over 99% of all businesses in the UK^{[footnote 20]} and the RoK. This chapter is designed to make the FTA more accessible and practical for SMEs, helping them unlock the full benefits of the agreement.

The chapter commits both parties to publish important trade-related information on a free, publicly accessible website, reducing administrative burdens and making it easier for SMEs to navigate export requirements. This transparency will support smaller firms in identifying opportunities and complying with market rules.

In addition, the chapter establishes a framework for UK-RoK cooperation on SME trade issues, including sharing best practices on priority areas such as access to trade finance. These efforts will help SMEs seize new opportunities, expand internationally, and thrive under the upgraded agreement.

Together, these commitments will empower SMEs to play a greater role in UK-RoK trade, driving innovation, job creation, and inclusive economic growth.

Level playing field and consumer protections

This chapter demonstrates the UK’s commitment to working with trading partners to promote free and fair trade and tackle unfair practices. More competitive markets create opportunities for businesses, drive down prices for British consumers, and provide consumers at home and abroad with greater choice.

It includes commitments to manage or prevent anti-competitive behaviour, including cartels, abuse of market dominance, and some mergers. Provisions also ensure that British businesses in the RoK are treated fairly by authorities and have means for self-protection and redress should they be contractually mistreated.

It also contains protections for consumers, including for online transactions, which guard against fraudulent, deceptive, misleading and unfair practices such as false advertising. The chapter also reinforces rights to seek redress, ensuring that consumers can shop with confidence.

This chapter includes mutual commitments on state enterprises operating in British or Korean markets. These commitments:

ensure that internationally recognised standards of corporate governance and the rule of law are applied to these companies
address monopoly behaviour
promote non-discrimination
provide for transparency, cooperation, and consultation to ensure a level playing field for UK business
keep open the possibility for exploring further commitments as our trade relationships develop

This chapter also carries forward the strong subsidy control commitments in our existing agreement, reaffirming and building on the World Trade Organization (WTO) subsidy framework. Unfair practices in providing subsidies undermine trust in the rules-based trading system and prevent UK businesses from competing fairly with foreign businesses. Tackling these practices promotes UK competitiveness and can contribute to economic security and growth.

Good regulatory practice (GRP)

The ambitious GRP chapter builds on both countries’ shared commitment to regulatory transparency, predictability, and stability, while safeguarding each country’s right to regulate.

The chapter emphasises opportunities for regulatory cooperation, highlighting mechanisms such as information exchange and dialogue, which can help address unnecessary regulatory divergence.

To promote a stable and predictable regulatory environment, the chapter includes provisions encouraging the use of proportionate regulatory impact assessments in the development of laws and regulations. This ensures that evidence-based policymaking considers the specific needs of businesses. The chapter also protects UK stakeholder participation in public consultations during the regulatory development process.

Together, these commitments will support good governance, improve the business climate, and contribute to the UK’s broader mission of driving economic growth through high-quality, collaborative regulation.

Trade and sustainable development (TSD)

The upgraded TSD chapter represents the most comprehensive set of environment and climate provisions the RoK has included in any FTA and maintains some of their strongest labour commitments to date.

The chapter includes new articles on a range of issues, such as climate change and the transition to clean energy. The chapter reaffirms our mutual commitments to effectively implement multilateral environmental agreements, including the Paris Agreement and the 1.5°C temperature goal. Recognising the urgent threat of climate change, the UK and the RoK have committed to endeavour to transition to low-carbon economies and phase down unabated coal-fired electricity generation.

The chapter also maintains important provisions on non-derogation and enforcement of environmental laws, recognition of the UK’s right to regulate in pursuit of its ambitious environmental and climate goals, and commitments to provide for and encourage high levels of environmental protection. Provisions to facilitate and promote trade and investment in environmental goods and services will directly benefit UK businesses and support the UK’s Clean Energy Superpower and Growth Missions.

On labour, the chapter retains robust commitments found in high-standard agreements, including provisions on non-derogation and effective enforcement of labour laws, committing each party to not waive or fail to enforce their own labour protections to gain a competitive advantage.

To further demonstrate our commitment to international labour standards, we have enhanced the existing TSD chapter by incorporating a new commitment to ensure ‘a safe and healthy working environment’ for workers. This update reflects the addition of this obligation to the International Labour Organisation’s (ILO) framework of fundamental principles and rights at work in 2022.

We have maintained the existing robust implementation mechanisms. These include a government-to-government specialised committee, a Civil Society Forum and the establishment of a Domestic Advisory Group.

Together, the provisions in this chapter demonstrate the UK and the RoK’s commitment to sustainable trade and will support our high environmental and labour standards

Anti-corruption

This is the first dedicated anti-corruption free trade agreement chapter to which the RoK has agreed. It sets out a shared ambition to tackle bribery and corruption, which remain significant barriers to international trade. Corruption increases the cost of doing business and holds businesses back from making the most of opportunities, posing a risk to both UK and Korean companies operating globally^{[footnote 21]}.

This chapter provides important reassurance to British and Korean businesses by addressing the trade-distorting impact of corruption on trade and investment. It reinforces both countries’ international obligations under key agreements such as the United Nations Convention against Corruption (UNCAC) and the Organisation for Economic Co-operation and Development’s (OECD) Anti-Bribery Convention, helping to uphold global standards of integrity and transparency.

The parties have also agreed to maintain a comprehensive set of anti-corruption measures. These include the criminalisation of bribery and foreign bribery, the prohibition of fraudulent book-keeping practices and facilitation payments, and measures to combat embezzlement and money-laundering. These commitments will help ensure that trade and investment flows are conducted with integrity and accountability.

Together, these provisions will support a fair and transparent trading environment, strengthen investor confidence, and reinforce the UK’s leadership in promoting ethical business practices through trade.

Innovation

This chapter recognises the critical role of innovation in driving economic growth and competitiveness. It establishes an Innovation Sub-Committee which will allow the UK and the RoK to enhance existing collaboration on research and development, technology transfer, and provide support for innovative enterprises.

Discussions under this cooperative framework may cover a range of areas, including future regulatory approaches, the commercialisation of new technologies, and supply chain resilience. This includes commitments to facilitate collaboration between UK and Korean research institutions and support joint innovation projects.

Convening the Innovation Sub-Committee will provide an opportunity for industry, academia and civil society to advise government on key challenges surrounding innovation and trade, and to help shape an appropriate response. We will work with the RoK to achieve the early identification and mutually beneficial resolution of unintended barriers to trade. This will include monitoring regulatory frameworks for new technologies, which will support businesses to maximise their global trading ambitions.

Core text

The core text chapters provide an effective legal and institutional architecture for the agreement.

The Preamble will provide a set of high-level joint statements which articulate the economic objectives of the agreement, as well as reflect important UK priorities for trade with the RoK.

A comprehensive set of exceptions has also been agreed. If necessary, these exceptions allow the UK and the RoK to take various measures to serve the legitimate public policy objectives set out within the exceptions that would not otherwise conform with the commitments made in the FTA. These flexibilities will protect our domestic policy space and preserve the UK’s right to regulate in the public interest.

The chapter will incorporate the General Exceptions found within the WTO’s General Agreement on Tariffs and Trade (GATT) and General Agreement on Trade in Services (GATS), and a dedicated exception relating to national security. It will also provide policymaking discretion in matters of taxation and macroeconomic management, and a provision recalling the exclusions and exceptions elsewhere in the agreement that are applicable to the National Health Service (NHS).

This agreement will continue to be overseen by a joint Trade Committee, which will be chaired by respective trade ministers. This and the wider institutional framework will serve to effectively implement the agreement and provide appropriate forums for future cooperation.

Furthermore, we have ensured the Windsor Framework is fully accounted for in the agreement, and there is a mechanism to extend further chapters to the Crown Dependencies and the whole FTA to the Overseas Territories.

4.4 Annex summaries

Pharmaceutical products and medical devices

The UK and the RoK have updated the pharmaceutical products and medical devices annex. This revised version replaces the previous annex rolled over from the EU-RoK Agreement and provides a clearer framework for UK and Korean stakeholders.

The updated annex is better tailored to reflect the UK system and how we make pricing and reimbursement decisions for pharmaceutical products and medical devices. It helps businesses understand their responsibilities and offers clarity on how pricing and reimbursement is determined, as well as how businesses can expect the systems to work. It will continue to support UK companies in navigating the RoK’s healthcare market more effectively.

The UK and RoK have also committed to encouraging negotiations toward a mutual recognition agreement. Such an agreement could reduce costs and streamline processes for UK businesses seeking to export pharmaceutical products and medical devices to the RoK, helping to unlock new opportunities in a growing and innovative sector.

Geographical indications (GIs)

The UK has secured an agreement from the RoK to initiate the process for recognising and protecting further UK GIs from all 4 nations of the UK, for protection under the upgraded FTA. GIs are food, drink and agricultural products with a geographical connection, or products that are made using traditional methods that can be registered and protected as intellectual property. GI status will ensure that the heritage and quality of produce from across the UK is protected and recognised in the RoK.

Domestic regulation

The UK and the RoK have agreed to a domestic regulation annex that sets a new benchmark for the RoK in its trade agreements. The annex reinforces our mutual commitment to fair, transparent and efficient services trade and builds on the outcomes achieved in the WTO Joint Statement Initiative on Services Domestic Regulation. The annex includes commitments that make the administrative processes for securing authorisation or licensing to supply a service less burdensome and more accessible.

These measures will help reduce delays and costs for UK service providers entering the Korean market, supporting smoother and more predictable market access.

To support modernisation, the annex also promotes the digitalisation of administrative procedures. This includes encouraging the use of electronic payment for authorisation fees and requiring the publication of relevant authorisation procedures and information online. These provisions will improve transparency and make it easier for businesses to navigate regulatory requirements.

Together, these commitments will help create a more open and efficient regulatory environment, supporting UK service exporters and enhancing the ease of doing business in the RoK.

Legal services

As a global leader in professional services, the UK has sought ways to support and promote British firms and professionals operating in the RoK.

Recognising the importance of our world-leading legal services sector, the UK has successfully secured a commitment from the RoK to work towards resolving key barriers faced by UK lawyers and law firms entering and operating in the Korean legal services market, such as those relating to post-qualification experience requirements for lawyers and Foreign Legal Consultant office administration. Such a scenario could create exciting new opportunities for UK and Korean legal services trade.

Recognition of professional qualifications

We have secured agreement on a professional services annex which will streamline existing arrangements, allowing for faster and more efficient recognition of professional qualification agreements between UK and Korean regulators, better facilitating the exchange of expertise and enhancing collaboration.

This annex encourages dialogue on the recognition of professional qualifications (RPQ) between relevant and mutually interested bodies in the UK and the RoK. These arrangements address an important behind-the-border market access barrier for professionals and businesses. They allow professional qualifications to be recognised overseas without the need for requalification, thereby reducing administrative burdens, time and costs.

Professions regulated by law (such as medical and legal services), as well as industry-regulated professions (such as engineering, accountancy and surveying) benefit from these provisions.

Question 5

5. What happens next

Accepted Answer

Now that we have concluded negotiations, the UK and the RoK will work together to finalise the FTA text for signature.

Following this, the UK’s independent Trade and Agriculture Commission (TAC) will be commissioned to scrutinise the FTA and produce a report assessing whether its measures are consistent with the maintenance of UK statutory protections in relation to animal and plant health and life, animal welfare, and the environment.

Informed by the TAC’s advice (as well as advice from the UK’s Food Standard Agencies) the government will lay its own report under section 42 of the Agriculture Act 2020 (s42 report). The s42 report will cover the same topics as the TAC report, with the addition of analysis covering the maintenance of UK statutory protections in relation to human life or health.

We will also endeavour to share the signed agreement, explanatory material, and an independently scrutinised impact assessment with the Business and Trade Select Committee and International Agreements Committee, in confidence, prior to publication, where time allows. We will ensure that the select committees have a reasonable amount of time to scrutinise new agreements and produce any reports on them that they may wish to.

The FTA will then be subject to the usual pre-ratification scrutiny procedures under the Constitutional Reform and Governance Act.

Any legislative changes required to give effect to the agreement will need to be scrutinised and passed by Parliament in the usual ways before ratification can take place. Legislation necessary to implement the FTA will be brought forward and duly scrutinised by Parliament when time allows.

Entry into force will take place once both the UK and the RoK have completed their ratification processes.

The government will then help businesses to benefit from the FTA through the Utilisation Team and Export Support Service. These help businesses understand what has been agreed in the agreements and what it means for their sector, as well as support them to identify new export opportunities.

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