Since the establishment of General Agreement on Tariffs and Trade in 1947 and the launch of the World Trade Organization multilateral trading system in 1995, trade liberalization has led to an increase in global trade and the internationalization of production through the globalization of supply chains. More recently, however, as non-trade values such as national security, domestic industry development, labor rights, and environmental protection have become important considerations, supply chains have become an end in themselves rather than a means of pursuing efficiency, and are subject to regulation to achieve various policy goals pursued by governments. Major trading partners, including the United States, are moving away from supply chains based on efficiency and focusing on building supply chains that share values and ideologies, and as economics and security are closely linked, major countries are strengthening their national-level responses by announcing economic and security strategies and utilizing various policy measures, including subsidies, to build their own local production and supply chains.

The problem then lies in the fact that traditional WTO/FTA international trade rules do not adequately address the proliferation of such unilateral measures that regulate global supply chains linked to various non-trade issues, including national security, environment, labor, and human rights. Due to the legal limitations of international trade rules, affected companies are facing increased compliance costs from emerging supply chain regulations, despite their legitimate expectations of market access (previously) promised in trade agreements under existing bilateral agreements. In light of these issues, this study identifies and characterizes the phenomenon of global supply chain regulation, whether international (mainly bilateral) or unilateral, and identifies the status and limitations of current international trade rules in this regard, and draws policy implications for the future direction of our foreign trade policy and domestic legislation.

Chapter 2 identifies the various legal, institutional, and policy efforts aimed at regulating global supply chains and characterizes the emerging phenomenon of unilateral supply chain regulation. Given the current geopolitical and geoeconomic conflicts, nationalism, and the trend of strengthening domestic industry protection, most unilateral supply chain regulations are focused on supply chains such as key minerals and raw materials, industrial subsidies, and high-tech industries, as well as national security, labor rights, and environmental protection. In light of this, Chapter 2 examines the main areas of recent unilateral supply chain regulation, categorized by supply chain and security, environment, labor, and other issues, and provides a detailed review of the measures.

Chapters 3 and 4 examine unilateral supply chain regulation itself and the trade law issues that arise from its implementation. Chapter 3 discusses the current state of international trade rules governing supply chain regulation and their limitations, focusing on the WTO’s multilateral trade rules. It focuses on the role that international trade rules have played in the formation of unilateral supply chain regulation in terms of who, what, and how it is formulated and implemented, its categorization according to the legal nature of the measures, and its legitimacy, as well as the extent to which it is applicable and whether it is actually deterrent. It also looks at the possible evolution of the case law on the legality of trade measures based on non-product-related process or production methods or “NPR PPMs” and the future development of the national security exception.

Further this study reviews the current state of disciplines in bilateral and multilateral trade rules, including FTAs, on unilateral supply chain regulation, focusing on the chapters on trade in goods. Overall, FTAs’ chapters on trade in goods directly incorporate or contain similar provisions as the WTO’s multilateral trade rules, but in some cases provides for “WTO plus” provisions that go beyond the disciplines of the WTO agreements. This study assesses whether this bilateral and multilateral approach may have the effect of reducing incentives for unilateral supply chain regulation.

For more recent examples of sectoral agreements and memoranda of understanding that are specific to supply chain issues, this study reviews the critical minerals sector. Leading examples include the IPEF Supply Chain Agreement, the U.S.-Japan Critical Minerals Agreement (CMA), the U.S.-EU CMA under negotiation, the Minerals Security Partnership (MSP), and the EU’s Strategic Partnership. Characterize recent developments in the formation and discussion of supply chain-related international rules and draw implications for the development of new components of national trade agreements and new types of international (trade) agreements to promote security of critical minerals and related supply chain stability.

Chapter 4 discusses (i) trade secret protection issues in the course of unilateral supply chain regulations, and (ii) what should be prepared for in light of the increasing involvement and influence of private actors in supply chain regulatory regimes. As major supply chain regulation cases have demonstrated that regulators are leveraging their markets to demand information from regulated companies on a fairly comprehensive range of production and processing methods throughout their supply chains, this paper will examine the current state of trade secret issues in international law and in the national laws of major countries, and suggest responses at the international and national law levels. The phenomenon of private actors’ participation in supply chain regulation at the government level is not a case of unilateral supply chain regulation, but it is indirectly related. It focuses on the trend of public participation and emphasis on corporate responsibility that has been in full swing since the Facility-Specific Rapid-Response Labor Mechanism or “RRM” under the USMCA.

Chapter 5 provides the following policy implications for how to respond to each type of unilateral supply chain regulation, both as recipients and as designers and addressers of domestic policies that may affect global supply chains. Firstly, as an addressee of unilateral supply chain regulation, it is important to have sufficient information prior to the adoption of a particular country's policy that may affect our supply chain and to respond quickly at the pre-policy formulation stage to minimize concerns for our companies and industries. In order to reduce dependence on certain raw materials in the supply chain and to ensure stable supply and demand of key minerals important for clean technology and semiconductor production, it is necessary to diversify import lines, actively participate in international agreements and consultations on key minerals, and strengthen linkages and cooperation among similarly positioned countries. It is necessary to consider how to design and utilize bilateral and multilateral agreements as an international legal policy instrument that can effectively support Korea’s core mineral supply chain policy direction and cooperation among countries. Regarding supply chain regulations related to forced labor, companies may have limitations in assessing the actual presence of forced labor and monitoring various partners scattered within global supply chains, so the government should consider ways to support companies by proactively assessing the risk of forced labor in countries and providing the results to relevant companies. Given that minimizing the risk of forced labor in supply chains may be the duty of the state as well as companies in the context of sustainable development, it is also necessary to consider strengthening domestic legislation to meet global standards so that Korean companies do not face additional burdens in their overseas operations.

As for the exposure of corporate trade secrets to unilateralist supply chain regulation, Article 1.9 of the U.S.-China Phase 1 trade agreement signed in 2020 during the Trump administration can be referenced in multilateral and bilateral negotiations and discussions in which Korea participates. This agreement is the only example of a trade secret protection provision that includes a separate section on “trade secrets and confidential business information” and protects trade secrets from potential leakage in regulatory proceedings. Regarding the trend toward greater public participation and corporate responsibility for labor standards compliance, which is being led by some trading partners such as the United States through domestic legislation or multilateral agreements, efforts should be made through multilateral channels to secure a common understanding among countries on public participation in the international trading environment to ensure a common and uniform standard that is acceptable to all countries, and institutional improvements should be made to safeguards to prevent abuses, and transparency mechanisms to ensure the right of reply and access to information for companies under investigation.

Finally, as an addresser of domestic policies that may affect global supply chains, there is a need for strategic use of policy discretion to the extent permitted under current international trade rules and for institutional design to pursue multiple policy objectives, particularly within climate, labor, and supply chain policies. When pursuing multiple objectives, i.e., where industrial objectives and non- traditional value objectives coexist, careful consideration should be given to the design of measures to ensure that non-traditional value objectives are set as the primary objective. Korea also needs industrial support policies centered on core items and industries, but should be cautious about introducing laws and systems similar to the U.S. Inflation Reduction Act. This study stresses careful design of domestic industry support policies regarding the use of subsidies related to local parts usage requirements (LCRs) and encourages ‘commercial considerations’ in the design of domestic industrial support policies. Further it suggests that the Korean government make efforts to strengthen the external ‘durability’ of domestic legislation and policies in the face of various new trade issues, including new types of industrial support policies, including preparations for possible WTO complaints and consideration of countervailing duties that may be imposed by major trading partners.

국문요약

제1장 서론
1. 연구의 배경 및 필요성
2. 연구의 목적ㆍ범위ㆍ구성

제2장 일방주의 공급망 규제의 주요 내용과 특징
1. 개관
2. 공급망 및 안보 관련 규제
3. 환경 관련 규제
4. 노동 관련 규제
5. 그 밖의 이슈
6. 소결

제3장 일방주의 공급망 규제의 통상법적 쟁점
1. 개관
2. 일방주의 공급망 규제에 대한 국제통상규칙의 규율 현황 및 한계
3. 새로운 현상으로서의 공급망 특화 부문별 단독 협정ㆍ양해각서
4. 소결

제4장 일방주의 공급망 규제의 이행으로 인한 통상법적 쟁점
1. 개관
2. 일방주의 공급망 규제와 영업비밀 보호
3. 공급망 규제와 공공참여ㆍ기업책임
4. 소결

제5장 결론 및 시사점
1. 일방주의 공급망 규제의 유형별 대응 방향
2. 한국의 대내외 공급망 정책의 통상법적 유의사항

참고문헌

Executive Summary