Only Export-Import Performance Required for Port Hinterland Area Entry... "25% Reduction in Logistics Costs"

Resolution of Partial Amendment to the 'Port Act' at the Cabinet Meeting on the 24th
Export-Import Performance Required to Settle in Port Hinterland Areas
Scope of Performance Recognition Expanded from Jurisdictional Ports to Nationwide Ports

Panoramic view of Busan New Port hinterland complex. (Photo by Ministry of Oceans and Fisheries)

[Sejong=Asia Economy Reporter Moon Chaeseok] The government has approved a bill at the Cabinet meeting to relax the eligibility criteria for manufacturing companies to enter port hinterland complexes, aiming to increase cargo volume. Previously, only export-import performance at the jurisdictional port was recognized when determining company eligibility, but the scope has been expanded to include all ports nationwide. The government expects that if the amendment passes, companies entering port hinterland complexes will be able to save about 25% on logistics costs.

On the 24th, the Ministry of Oceans and Fisheries announced that the partial amendment to the 'Port Act,' which includes these provisions, was approved at the Cabinet meeting. Port hinterland complexes are places where companies can install cargo storage warehouses, parking lots, accommodation facilities, research facilities, and more. From the government's perspective, these facilities can attract corporate investment, increase the added value of port logistics, and boost new cargo volume.

The issue was with the legal provisions. Due to Article 69 of the Port Act, only companies that had export-import performance through the jurisdictional port could enter port hinterland complexes. Accordingly, the Ministry of Oceans and Fisheries decided to amend the law to expand the area for calculating export-import performance, which is the eligibility criterion for entering port hinterland complexes, from the jurisdictional port to all ports nationwide.

Additionally, the amendment includes incentives to enhance the benefits for port development operators (non-administrative authorities) other than the Minister of Oceans and Fisheries or provincial governors. ▲ It allows extension of the start time for port development projects, and ▲ provides grounds to establish rental fee collection standards when leasing port facilities for exclusive purposes installed by non-administrative authorities. It also establishes grounds for designating and entrusting an agency responsible for building and operating an integrated port construction information system to support stable project management.

The Ministry of Oceans and Fisheries expects that if the amendment passes the National Assembly, logistics costs for manufacturing companies entering hinterland complexes will be reduced by about 25%, and the activation of entry into eight port hinterland complexes nationwide will lead to the creation of new cargo volume. The ministry plans to actively respond to the National Assembly's review of the bill, aiming to complete the amendment by the end of this year.

Kim Chang-gyun, Director of the Port Bureau at the Ministry of Oceans and Fisheries, said, "We will actively persuade during the National Assembly review stage to ensure the bill is passed quickly and to highlight the effects of regulatory relaxation after the amendment," adding, "We will continue to devote ourselves to proactive administration so that companies entering port hinterland complexes can create more added value."