Peru Signs Free Trade Agreement with Korea

By Francisco Espinosa

Such agreement, which provides the frame for bilateral trade and commercial relations between the two countries, contains provisions on different topics such as Sanitary and Fitosanitary Measures, Custom procedures, Telecommunications, Foreign Investment, Electronic Commerce, Intellectual Property, Competition Policies, Environment, among others.

In relation with Intellectual Property there are some important provisions referred to enforcement and border measures, as well as copyright, all in the effort to combat counterfeiting and piracy.

A special regulation provides a mechanism to recognize and protect each country’s geographical indications in the other country.

Additionally, in line with Peru’s policy in recent FTA processes, a text was included for recognition and protection of genetic resources and traditional knowledge, mostly reaffirming some provisions contained in the Convention about Biologic Diversity. A cooperation mechanism was also incorporated for exchanging information to identify eventual patent filings that may be based on genetic resources and traditional knowledge from Peru or Korea.

Finally, cooperation mechanisms between the respective competent authorities were also agreed, including training projects and information exchange, among other complementary measures.

In 2009, the bilateral commercial exchange amounted to US$ 1.341,3 millions, from which Peru exports to Korea were around US$ 750 millions, which represented a growth of 38% respect to year 2008. Korean exports to Peru were around US$ 648 millions.

Peru exports to Korea primarily consist of mining products, oil, fishing and textiles, from which mining products represent 88% of the total exports, with zinc, copper and lead as the main minerals.

Korean imports in Peru consist mainly of machinery, vehicles and cell phones.

This Free Trade Agreement is expected to increase such commercial relationship in the upcoming years, while reducing the cost of their respective goods and services in the other country’s corresponding market.

The process, which began in March 2009, consisted of five negotiation rounds and three specific meetings between rounds.

After the corresponding political steps it is expected to enter into force halfway through 2011.

Peruvian Intellectual Property law firms also expect to receive an increase in IP work from Korea, in anticipation of the new business fronts that should originate from this new FTA.