US exempts Korea from export restrictions on Russia

The US government has formally exempted South Korea from its expanded export restrictions on Russia over its invasion of Ukraine, the Ministry of Trade, Industry and Energy said on Tuesday.

The US Department of Commerce added Korea to the list of countries to be excluded from license requirements, including from the foreign direct product (FDP) rules for Russia and Belarus.

Also on the list are member states of the European Union, Japan, Canada, Australia, the UK and New Zealand.

“Providing exclusions to partner countries enhances the multilateral effort to implement strong export controls,” read the joint statement issued by Seoul and Washington on Monday.

The US government last month announced the FDP rule for all of Russia, requiring companies to receive a license for tech-related items using US technology before they can be shipped to Russia.

South Korea was initially not on the list of nations that were exempted from the FDP rule, raising concerns over the impact on its major exporters that use US technology and software, but won an exemption last week after negotiations with the US government.

“We welcome the Republic of Korea (ROK)’s commitment to stand with us against authoritarianism and with the Ukrainian people as they fight to defend the principles and values of democratic self-determination, freedom, and peace,” US Secretary of Commerce Gina Raimondo was quoted as saying in the joint statement.

“This unprecedented multilateral coordination on export controls is an essential component to ensuring our response to Russia’s invasion is swift, severe and successful. I’m proud to accept the ROK’s commitment to that effort.”

Earlier, South Korea announced a series of sanctions against Russia, including halting financial transactions with seven major Russian banks and their affiliates slapped with US sanctions, in line with the global efforts to remove Russia from the SWIFT global payment network.

The Seoul government also decided to ban exports of strategic items to Russia while strongly recommending local public and financial institutions halt their investment in Russian government bonds.

“Our strong commitment on export controls against Russia as well as the addition of ROK to the list of excluded countries of FDP rules for Russia/Belarus demonstrate ironclad alliance and reciprocal partnership between the ROK and the US,” Minister of Trade, Industry and Energy Moon Sung-wook was quoted as saying in the joint statement.

By Kim So-hyun (sophie@heraldcorp.com)

By Cho Chung-un (christory@heraldcorp.com)