U.S.-Korea Trade Deal Details Released

Oct. 30, 2025
By: Pietro N. Bianchi

The South Korean and U.S. governments have announced details of a trade deal between the two countries following President Trump’s visit to Asia. The Blue House’s press release focuses on the benefits to Korea, while the White House’s fact sheet focuses on Korean pledged investments in the U.S.

The Blue House states that International Emergency Economic Powers Act (“IEEPA”) trade deficit tariffs will remain at 15% but emphasized that Section 232 tariffs on automobiles and automobile parts will be reduced to 15%. Automotives is one of Korea’s top exports to the U.S. and this tariff reduction brings them in line with competitors such as Japan and the E.U. Pharmaceuticals and wood products will receive most-favored-nation (“MFN”) treatment. Pharmaceuticals have a Section 232 investigation and wood products are currently subject to Section 232 duties. So, it appears that Korean pharmaceuticals and wood products will be excluded from Section 232 and from IEEPA tariffs. Aircraft and parts, generic drugs, and natural resources not produced in the U.S. will enter tariff-free. Further, a 15% tariff will be imposed on goods qualifying under the U.S.-Korea FTA, even if an item exceeds the MFN of 15%. Because the U.S.’s average MFN rate is approximately 3.3%, this does not seem to be an advantage unless it refers to a combined MFN and IEEPA rate.

The White House fact sheet simply lists Korean investment promises and figures, which include civilian and military aerospace contracts, rare-earth refining, U.S. liquid natural gas and energy, AI, cloud infrastructure, and American shipbuilding capacity. The Blue House stated that Korean investments will be capped at an annual contribution limit of $20 billion and Korea will invest only in projects that are "commercially reasonable" – projects that will generate sufficient cash flow to recoup the investment amount. Korea stated that it is stipulated to share the profits 50/50 with the U.S. until the principal and interest are repaid.

While both parties claim that a deal has been reached, there is little overlap in their statements. Time will tell if a deal has been reached or if, like previous deals, misunderstanding persists. If you have questions about IEEPA tariffs, trade remedies, or free trade agreements, do not hesitate to contact an attorney at Barnes Richardson, & Colburn LLP.