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Guide to Customs Administration

Necessity of AEO Authorization and the Benefits of AEO Status

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Why is AEO authorization necessary?

Necessity may be said to be the highest value of all systems. The necessity of AEO authorization is based on the following requirements:

First: Terms and conditions of trade

As the international society has recently been getting more and more interested in logistics security, the terms and conditions of trade are also becoming more and more complicated. In addition to requiring fulfillment of the existing trade conditions, a growing number of companies define AEO authorization as a prerequisite for trade. Therefore, companies failing to satisfy the AEO criteria may experience the scope of their trading partners or activities getting narrower or face unexpected disadvantages.

Second: Enhancement of export competitiveness

Swift customs clearance is a matter of greatest concern for exporters. A private company has limitations in its ability to solve the customs clearance problems by itself because it is difficult for private companies to control these problems, they lack understanding of local laws and regulations or systems, and different countries implement different customs administrations and have different logistics infrastructure environments. However, AEOs can solve these problems. Since AEO-certified companies are trusted by the Korea Customs Service and recognized by the international society, we can resolve trade barriers and enhance our export comprehensiveness through AEOs.

Third: Various benefits for AEOs

As AEOs are state-certified reliable companies, they can be guaranteed swifter and more simplified trade procedures when exporting or importing goods. In addition, once mutual recognition arrangements (MRA) are concluded with other countries implementing the AEO system, AEOs will be provided with diverse benefits including the convenience of swift customs clearance such as reduced inspection rates also in the MRA counterpart countries. As a result, AEOs can reduce the lead times and various costs for international trade.

What benefits are provided for AEOs?

The Korea Customs Service provides AEO companies with a variety of benefits including simplified inspections and procedures, eased financial burdens and diverse conveniences. Through these benefits, the KCS implements differentiated risk management for AEOs compared to non-AEO companies. In addition, the KCS is exerting efforts to unearth further benefits for AEO companies. If you have any good ideas for unearthing additional benefits, suggesting them to the KCS is a good method to unearth various new benefits.

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