1. DUTY CUSTOMS REFUND MEANING

Depends on the reason, there are several types of duty refund, but generally it refers to the refund by Act of special Cases concerning the refund of customs, levied on raw materials for export.
According to Customs Law, the Refund mainly is a payment back of overpaid taxes, caused by wrong export or import contract declaration.

2. Customs duty refund in accordance with Act on Special cases concerning the refund of customs duty.

Customs duty on importing raw materials, which has already paid or has to be paid, in spite of the Customs Act Rule, can be refunded to exporter or manufacturer, according to Act on Special cases.
Duty refund is the rebate of duty chargable on imported material or excisable materail used in the manufacturing of goods in and is exported.
In case of re-export goods, it should be done within 2 years from the date of payment of duty, when they were imported.

3. Raw Materials Subject to Refund.

Raw materials for which customs duties, etc. may be refundable (hereinafter referred to as the "raw materials for export") shall be those which fall under any one of the following subparagraphs:

1. Where export goods are produced, those falling under any one of the following items:
   - Materials combining physically or chemically with relevant export goods.
   - Materials put in the process producing relevant export goods and consumed: Provided, That materials put in the production of export goods indirectly and consumed, such as those for the operation and maintenance of machinery, apparatus, etc. for producing export goods, shall be excluded.
   - Packing materials of relevant export goods.
2. Export goods offered for export in the same condition as imported.
   - If raw material produced domestically having the same quality and characteristics as that of imported raw material is used indiscriminately in the production process of export goods because it is mutually substitutable, it shall be deemed that raw materials for export have been used.

4. Export, subject to Refund

Export, for which customs duties on raw materials for export may be refundable shall be those falling under any one of the following subparagraphs:

1. Export for which an export report has been accepted according to the Customs Act: Provided, That those exported free of charge shall be limited to such exports as prescribed by Ordinance of the Ministry of Strategy and Finance;
2. Of the sales or construction works which acquire foreign currency in the Republic of Korea, those prescribed by Ordinance of the Ministry of Strategy and Finance;
3. Supplies to a resident enterprise in a district prescribed by the Ordinance of the Ministry of Strategy and Finance from among the bonded areas referred to in the Customs Act or a free trade zone under the Act on Designation and Management of Free Trade Zones; and
4. Others recognized as exports which are prescribed by Ordinance of the Ministry of Strategy and Finance.

5. Collection of Customs Duties on Raw Materials for Export

1. The head of a customhouse shall, notwithstanding the provisions of the Customs Act, etc., collect customs duties, etc. on imported raw materials for export at the time of import thereof.
2. Where a person who imports raw materials for export files an application, the head of a customhouse may, notwithstanding the provisions of the Customs Act, etc., have him/her pay customs duties, etc. on relevant raw materials in a lump sum by the specified period prescribed by Presidential Decree (hereinafter referred to as the "lump-sum payment period") within the limit of 6 months. In this case, the payment period of customs duties, etc. shall be by the 15th of the month following the day on which relevant lump-sum payment period is terminated.
3. Where the Commissioner of the Korea Customs Service acknowledges that a lump-sum payment of customs duties, etc. pursuant to paragraph (2) and a settlement of accounts are possible for a transaction in which raw materials for export are traded by means of local letters of credit or other documents similar thereto as prescribed by Ordinance of the Ministry of Strategy and Finance (hereinafter referred to as the "local letters of credit, etc."), the supply of raw materials for export by local letters of credit, etc. may be regarded as export and the receipt of such supply may be regarded as import, notwithstanding the provisions of the Customs Act, etc.
4. The Commissioner of the Korea Customs Service may provide the standards and procedures necessary for the lump-sum payment of the customs duties, etc. pursuant to paragraph (2)

6. Settlement of Accounts of Customs Duties, etc. and Refund Amount on Raw Materials for Export

1. The head of a customhouse shall settle the accounts of the customs duties, etc. which a lump-sum payment enterprise of customs duties, etc. has to pay in a lump sum under Article 5 (2) and the refund money the payment of which has been reserved under Article 16 (3) under the conditions prescribed by Presidential Decree, and notify the lump-sum payment enterprise of customs duties, etc. of the result of the settlement of accounts thereof (hereinafter referred to as the "notification of settlement of accounts") by the day prescribed by Presidential Decree.
2. The head of a customhouse shall, when there are customs duties, etc. to be collected as a result of the settlement of accounts pursuant to paragraph (1), give notice for tax payment within the period of notification referred to in paragraph (1) pursuant to the provisions of Article 39 of the Customs Act.
3. The lump-sum payment enterprise of customs duties, etc. which has received the notice for tax payment under paragraph (2) shall pay the customs duties, etc. by the 15th of the month following the day on which the period of lump-sum payment is terminated.
4. The head of a customhouse shall, when there is any refund money payable as a result of the settlement of accounts pursuant to paragraph (1), pay immediately relevant amount of money under the provisions of Article 16 (1) and (4).
5. The head of a customhouse may, when he/she finds any excess or deficiency in the amount obtained from the settlement of accounts after the notification of settlement of accounts, rectify it.