Waste charges, prove irrelevance or pay.

Once importers of products pay taxes levied by Customs (e.g. customs duties, VAT) and receive customs-cleared products, they may think that there are no further bills to pay related to the imported products. Then, they may be puzzled at the notice from the Korea Environment Corporation (K-eco) regarding waste charges (폐기물부담금).

Waste charges are imposed by the K-eco entrusted by the Minister of Environment under the ACT ON THE PROMOTION OF SAVING AND RECYCLING OF RESOURCES (자원의 절약과 재활용촉진에 관한 법률, APSRR) for the products, materials, and containers which may contain specific air pollutants, specific water pollutants or poisonous substances, or which are difficult to be recycled or likely to cause problems in waste management such as gums, disposable diapers, cigarettes, ice pacts containing super absorbent polymer as a refrigerant, etc.

 

Importers of chemicals not containing such regulated substances may think that the imported goods are not subject to waste charges and they have nothing to do with them.  But it is not true.

 

If the HS Code used for the import declaration of the goods is listed in the Table 11 attached to the CONSOLIDATED PUBLICE NOTICE (통합공고), the imported goods are presumed to be subject to waste charges. Their importer can be exempt from waste charges when documentary evidence proving that the imported goods are irrelevant, that is, not containing the regulated substance is submitted to and recognized by the K-eco.

 

Under Article 12 of the ENFORCEMENT DECREE OF THE ACT ON THE PROMOTION OF SAVING AND RECYCLING OF RESOURCES (자원의 절약과 재활용촉진에 관한 법률 시행령), importers of the goods subject to waste charges shall submit the previous year’s import data to K-eco by March 31. Import data can be submitted through the online waste charge system (https://wcs.budamgum.or.kr/wcs/usr/index.do). 

Waste charges shall be calculated as follows:

Waste charges

= Submitted shipping/import volume of products, materials, and containers × Calculation standard × Charge calculation index

 

It is not easy to apply Calculation standard as prescribed in Table 2 attached to the ENFORCEMENT DECREE OF THE ACT ON THE PROMOTION OF SAVING AND RECYCLING OF RESOURCES and Charge calculation index which shall be determined by multiplying the charge calculation index for the previous year by the price fluctuation index publicly notified by the Minister of Environment. However, the waste charge system provides the waste charge calculator as below and we can get the amount by uploading type of product, material, or containers, import volume, usage of recycled raw materials, and amount of plastic input onto the system.

In any of the following cases, even if the imported goods are relevant, their importers can be exempt from waste charges by filing  the Statement of Confirmation of Exemption from Waste Charges accompanied by documentary evidence of qualification and basic data for calculating exemption from waste charges for each product (in cases of plastic products, including data to prove the amount of synthetic resin input) with the K-eco:

· Products, packing materials and products made of biodegradable resin provided for in Article 16 of the APSRR;

· Products, materials or containers made of plastics, which can be recovered and recycled at not less than a percentage prescribed by Presidential Decree, and the products, materials and containers manufactured or imported by a manufacturer or an importer who concluded a voluntary agreement (the duration of the agreement shall not exceed five years) with the Minister of Environment for the recovery and recycling and has fulfilled such agreement;

· Products, materials, and containers produced or imported by any manufacturer or importer for export;

· Samples of products, materials, and containers imported for research by any institution or organization referred to in Article 14 (1) of the Basic Research Promotion and Technology Development Support Act;

· Products produced by a manufacturer of plastic products whose annual turnover of plastic products is less than 1 billion won;

· Products imported by an importer whose annual import amount of plastic products is less than 90,000 U.S. dollars;

· Products produced by a business operator, which contain plastics whose annual volume does not exceed 10 tons;

· Products imported by an importer, which contain plastics whose annual volume does not exceed 3 tons;

· Following products whose owners have obligations imposed following acquisition, keeping, use, and disposal thereof:

 i. Motor vehicles (excluding two-wheeled vehicles) defined in subparagraph 1 of Article 2 of the Motor Vehicle Management Act;

ii. Automobiles acquired pursuant to Article 11 of the Act on the Management of Military Supplies;

iii. Construction machinery defined in Article 2 (1) 1 of the Construction Machinery Management Act;

iv. Korean ships referred to in Article 2 of the Ship Act;

v. Fishing vessels defined in subparagraph 1 of Article 2 of the Fishing Vessels Act;

vi. Aircraft registered pursuant to Article 7 of the Aviation Safety Act;

vii. Railroad cars managed by a business operator licensed pursuant to Article 5 of the Railroad Service Act;

viii. Medical devices publicly notified by the Minister of Environment, such as disposable syringes, disposable needles, disposable blood collection needles, and blood collection sets, among the medical devices defined in Article 2 (1) of the Medical Devices Act which are supplied to medical institutions discharging the medical wastes under subparagraph 5 of Article 2 of the Wastes Control Act;

 

Based on the submitted import data and documents, the K-eco gives a notice of payment of waste charges by April 30, then the importer shall pay the waste charges by May 20.

 

So, be sure to prove irrelevance by March 31 if the HS Code listed in the Table 11 attached to the CONSOLIDATED PUBLICE NOTICE has been used to import goods not subject to waste charges.