CONTENTS
- 1. Trade Dispute | Key Changes in the 2026 National Trade Estimate Report
- 2. Trade Dispute | Issues Raised With Respect to Korea
- - Specification of Non-Tariff Barriers by Sector
- 3. Trade Dispute | Points of Change Compared With 2025
- - Sector-Specific Impacts and Response Strategies
- - Daeryun's Response to Trade Disputes
1. Trade Dispute | Key Changes in the 2026 National Trade Estimate Report
The 2026 National Trade Estimate Report is the 41st annual report, and its length increased significantly compared with the previous year, with its scope of analysis broadened.
The discussion of Korea likewise expanded, indicating that the United States' level of interest in Korea has grown.
●Key Features
- Increase in the report's length: 397 pages → 534 pages
- Expansion of Korea-related content: 7 pages → 10 pages
- Change in evaluation criteria: focus on tariffs and market access => expanded to regulation, institutions, supply chains, and ESG
This report shows a clear difference from prior reports in both form and substance.
First, its length itself increased substantially compared with the previous year, and the discussion of Korea also expanded.
The more fundamental change lies in the broadening of the evaluation criteria.
Whereas evaluations in the past centered on tariff levels and market accessibility, this report introduces new items such as non-market policies, labor, the environment, and supply chain transparency as common evaluation criteria.
In particular, the fact that these criteria were applied equally not to a specific country but also to major allies such as Korea, the European Union, and Japan suggests that trade issues are being reshaped beyond bilateral trade disputes into part of a global supply chain strategy.
●Trade Status (as of 2025)
- Goods trade deficit with Korea: approximately USD 56.4 billion (a decrease from the previous year)
- Services trade balance: approximately USD 11.3 billion surplus
- Korea's position: the United States' 9th-largest goods export market and 15th-largest services export market
Looking at the trade data as of 2025, the United States' goods trade deficit with Korea was approximately USD 56.4 billion, a decrease from the previous year, while in services trade it recorded a surplus of USD 11.3 billion.
Korea remains highly significant as one of the United States' major export markets; however, separate from this economic relationship, the raising of issues regarding the regulatory and institutional spheres is instead showing a trend of expansion.
2. Trade Dispute | Issues Raised With Respect to Korea
While USTR positively assessed the fact that Korea has eliminated a substantial number of tariffs under the Korea–U.S. Free Trade Agreement, it identified the following elements as potential non-tariff barriers.
●Principal Points Raised
- Maintenance of tariff-rate quotas (TRQs) on certain agricultural products
- Digital regulation and restrictions on data transfers
- Restrictions on the entry of foreign companies in government procurement and certification systems
- Insufficient standards for labor, environmental, and supply chain management
In addition, this report makes clear that it will continuously review whether the Korea–U.S. Strategic Trade and Investment Agreement announced in July 2025 is subsequently implemented.
This means that, in the event of future trade disputes and tariff-related disputes, specific changes to Korea's institutions may be demanded during the negotiation process.
Specification of Non-Tariff Barriers by Sector
●Agriculture and Livestock and SPS (Sanitary and Phytosanitary Measures)
· Maintenance of the ‘30-month age limit’ on U.S. beef
· Multiple-review structure for GMO and gene-edited products
· Divergence from international standards due to pesticide residue standards (PLS)
In the agriculture, livestock, and sanitary and phytosanitary (SPS) sector, the lack of transparency in the operation of the tariff-rate quota system for rice and soybeans, together with the 30-month age limit applied to U.S. beef, was raised as a continuing concern.
In addition, the multiple-review structure for genetically modified and gene-edited products, as well as the fact that the method of setting pesticide residue standards diverges from international standards, were mentioned as principal points of contention.
These elements may have a substantial effect on business activities, in that they can lead to reduced predictability throughout the import process.
●Digital, Data, and IT Services
· Penalty surcharges and transfer restrictions based on the Personal Information Protection Act
· Obligation to process financial data domestically
· Restrictions on the use of overseas cloud services by companies holding national core technologies
· Global platform regulation and network usage fee issues
In the digital and data sector, the intensity of regulation was emphasized to an even greater degree.
Restrictions on the cross-border transfer of location-based data, the penalty surcharge framework following the amendment of the Personal Information Protection Act, and the obligation to process financial data domestically are assessed, from the perspective of global companies, as regulations of a level that requires redesigning their data strategies.
With the addition of restrictions on cloud use linked to national core technologies, as well as legislative movements relating to platform regulation and network usage fees, the regulatory risk across the digital industry as a whole is structurally expanding.
●Government Procurement and Security Certification
· Requirement for domestic encryption algorithms
· Structure restricting foreign companies in the public market
In the government procurement and security certification sphere, the cloud security certification system and the requirement for domestic encryption algorithms were identified as principal factors restricting foreign companies' entry into the public market.
These may operate as elements that structurally restrict market access itself.
●Supply Chains, Labor, and the Environment
· Illegal, unreported, and unregulated (IUU) fishing issues
· Failure to conclude an agreement to prevent tariff circumvention
The items relating to labor, the environment, and supply chains are areas newly emphasized in this report.
Insufficient systems relating to forced labor, illegal fishing issues, and a lack of frameworks to prevent tariff circumvention were mentioned, and these are highly likely to lead to trade pressure linked to ESG standards going forward.
In particular, the demand for supply chain transparency warrants attention, in that it may have a direct effect even on companies' internal management systems.
●Pharmaceuticals and Automobiles
· Ambiguity in the certification criteria for innovative pharmaceutical companies
· Unclear certification criteria for automobile parts
· Existence of criminal risk relating to imported vehicles
In the pharmaceuticals and automobiles sector as well, uncertainty in the operation of the relevant systems was identified as a core problem.
The lack of transparency in the method of calculating drug prices and in the negotiation structure, and the ambiguity in the certification criteria for automobile parts, are examples that illustrate risks arising from the interpretation and enforcement of regulations rather than from the regulations themselves.
3. Trade Dispute | Points of Change Compared With 2025
This report shows that the structure of trade policy itself is changing.
●Core of the Change
Category | 2025 | 2026 |
Evaluation criteria | Focused on market access | Including supply chains and ESG |
Target countries | Some major countries | Expanded to include allies |
Purpose | Identifying trade barriers | Policy pressure and use in negotiations |
The United States is no longer aiming merely to resolve its trade deficit; it is moving toward a stage of demanding even policy coherence from its allies in the process of restructuring global supply chains.
This means that Korea is being recognized as a cooperative partner that must share a particular policy direction.
At the same time, such demands may, from the perspective of companies, operate as a risk of policy change that is difficult to predict.
Sector-Specific Impacts and Response Strategies
For IT and platform companies, cloud certification and data regulation are operating as core variables that affect the very structure of their business.
In particular, for companies considering entry into the public market, designing certification requirements and a localization strategy in advance is indispensable.
In the pharmaceutical, medical device, and automobile industries, regulatory uncertainty is operating as the greatest risk factor.
Because there is a possibility that particular systems may become the subject of future trade negotiations, scenarios of policy change should be considered together when making decisions on product launches or investments.
For the agri-food and bio industries, the need to reexamine the structure of raw material procurement and overall distribution strategy is growing as a result of reductions in tariff-rate quotas and the strengthening of labeling systems.
The change common to all industries is the strengthening of supply chain management standards.
The United States is directly linking forced labor, circumvention exports, and ESG issues to trade matters, and accordingly companies need to enhance their due diligence systems across the entire supply chain.
●Practical Checklist for Companies
Daeryun's Response to Trade Disputes
Companies have entered a stage in which they must build an integrated response system that brings together trade, legal, and business strategy.
Changes in regulation can lead directly to changes in business models, and proactively managing this will be a key element in securing future competitiveness.
Accordingly, this is a point at which it is indispensable for companies to build an integrated response system that brings together their trade, legal, and business divisions.
To respond to these changes, Daeryun Law Firm LLP, based on an advisory framework that integrates the fields of international trade, corporate legal affairs, fair trade, and data and IT regulation, identifies the trade risks that companies may face in advance and designs response strategies.
In particular, with respect to the restructuring of global supply chains, it presents practical response measures, including legal review of matters such as ESG standards, forced labor risks, circumvention exports (tariff avoidance), and trade disputes, together with the establishment of internal corporate control systems and improvements to contract structures.
In addition, with respect to digital regulation, it provides advisory services that analyze the possibility of conflicts among the regulations of different countries, such as cross-border data transfer, restrictions on cloud use, and personal information protection issues, and that design data operation structures suited to a company's business model.
In addition, through customized advice reflecting the regulatory characteristics of each industry, including pharmaceuticals and bio, automobiles, and agri-food, it supports companies in reducing business risks arising from policy changes and in proactively reorganizing their contract structures and supply chain strategies.
Daeryun Law Firm LLP will help companies carry out their business stably amid the changing global trade order through legal risk management and strategic decision-making support.
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