Trends in Trade Security (Strategic Goods) Legislation and Implications for Defense Industry Security

This study aims to provide implications for defense industry security by examining the defense industry, trade security, and legislative trends on the export and import of strategic goods and by comparing the penalty provisions related to strategic goods under the Foreign Trade Act and the Defense Acquisition Program Act. To achieve the purpose of the study, this paper discusses the latest increases in defense industry exports, export control laws and regulations of the United States and Japan, and the expansion of services of the Korean Security Agency of Trade and Industry. Moreover, this paper compares the provisions regarding the export and import of strategic goods under the amended Foreign Trade Act, effective as of August 21, 2024, and the Defense Acquisition Program Act as well as the penalty provisions under those Acts. In cases where a defense material or national security science and technology constitutes a strategic good, export permission and brokerage permission should be obtained in compliance with the Defense Acquisition Program Act whereas situational permission and transit or transshipment permission should be obtained in compliance with the Foreign Trade Act. Accordingly, this paper suggests that those engaging in the export and import of defense industry goods should understand and comply with the Defense Acquisition Program Act and the amended Foreign Trade Act and that the penalty provisions of the Foreign Trade Act and the Defense Acquisition Program Act should be amended by taking into account the fairness and equity considerations.