The Ministry of Trade, Industry, and Energy revised an enforcement ordinance of the Foreign Trade Law in October 2016, recognizing the sales to foreign tourists at duty-free shops as part of export.
The annual sales of Korea's duty-free shops amounted to 1.2 trillion won last year, of which the sales to foreign tourists accounted for 67 percent.
The amount of exports through local duty-free shops' sales to foreign tourists amounted to 804 billion won. As foreign tourists purchase domestic brands at duty-free shops, it cleared the way for the local brands to be reborn as export companies. In particular, cosmetics firms enjoyed a robust growth thanks to the sales through duty-free shops.
A local mask pack brand Medi Heal gained a reputation after getting an opportunity to be sold through Lotte Duty Free Shop beginning in 2012.
L&P Cosmetics, the manufacturer of the Medi Heal brand, saw its annual sales jump to 400 billion won last year from 7.5 billion won in 2012. In just four years, L&P Cosmetics marked a 45-fold growth in annual sales.