South Korea uses blockchain to fight customs fraud

South Korea’s border authority has partnered with Samsung to implement blockchain technology to decentralise customs while reducing fraud and increasing efficiency.

The Korea Customs Service has signed a memo of understanding (MoU) with the tech giant. Samsung SDS, the conglomerate’s internet technology branch, will apply its Nexledger blockchain to the new platform.

According to a press release, 48 Korean public agencies and shipping and insurance firms have also signed the MoU. These will participate as nodes on the decentralised platform providing greater transparency to the customs process.

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A tool against forgery

The platform is designed specifically to block the forgery of export and import documents as well as to improve efficiency.

The country’s customs agency began working with Samsung in May by joining its newly-launched shipping and logistics consortium.

Fraud and corruption in customs cause huge losses. For example, the UK currently is facing a close to $2.2 billion fine from the European Union for failing to crack down on customs fraud from Chinese clothing importers.

South Korea’s budget for blockchain

South Korea has for some time been pushing forward blockchain adoption in public services. In August, the government announced a whopping $4.4 billion budget for “Growth and Innovation” aimed a blockchain, artificial intelligence and other emerging technologies.

Last year, it granted Samsung SDS a contract to come up with a timeline to apply blockchain technology by 2022 to make public administrative services more efficient and transparent. One of the first application in Samsung’s roadmap is to gather citizens’ private data.