Costa Rica - El Salvador Arbitration Over Tires and Juices

A dispute over the failure to implement tariff benefits on the part of El Salvador on tires and juices exported by Costa Rica has not been resolved using other methods.

Tuesday, January 7, 2014

The Costa Rican Minister of Foreign Trade, Anabel Gonzalez confirmed that on January 20th El Salvador will be taken to court for not applying the tariff benefits negotiated in the FTA between the U.S., Central America and the Dominican Republic on tires and juices.

According to Gonzalez, the only thing they are waiting for is for the end of the time period established in the trade agreement for requesting the establishment of the panel. The dispute is centered on the fact that the Central American nation "...has not implemented the tariff reduction process on those products exported by the free zone regime," reported Nacion.com.

"There is a need for the countries to clarify the rules of the game and for everything to function in an expeditious manner ," said Mario Montero, executive director of the Chamber of Food Industry.

"This could affect not only tires, but other companies who see the impossibility of using this mechanism because of El Salvador's ban," said executive vice president of the Chamber of Industries, Martha Castillo.



More on this topic

Tires and Juices From Costa Rica with Zero Tariffs in El Salvador

July 2015

As of July 1 the arbitration panel ruling which came down on the side of Costa Rica will be put into practice, and from now on all Costa Rican exports to the Salvadoran market will enjoy the preferences stated in the DR-CAFTA.

From a statement issued by the Ministry of Foreign Trade of Costa Rica:

El Salvador Calls For Regional Support in Tariff Conflict with Costa Rica

January 2014

The Salvadoran President has asked the SIECA to intervene in a trade dispute with Costa Rica.

President Mauricio Funes, believes that a regional agency should resolve the trade dispute with Costa Rica, which has requested the creation of an international arbitration group. The problem, Funes said, should be resolved by the Secretariat for Central American Economic Integration (SIECA).

U.S. Not Respecting Costa Rica's Ethanol Quota

December 2013

Exporters of dehydrated ethanol claim that the U.S. is applying an ad valorem tax of 2.5% which is outside of the provisions of DR-CAFTA.

According to Anabel González, the Minister of Foreign Trade (Comex), Costa Rica has not exported the product during the second half of 2013, because the annual quota for receiving the benefits is 31 million gallons.

Costa Rica Accuses El Salvador of Violating FTA

September 2013

The country has invoked the dispute settlement mechanism of the CAFTA-DR, over alleged violation by El Salvador of the tariff reduction program.

From a press release issued by the Ministry of Foreign Trade of Costa Rica (COMEX):

The Ministry of Foreign Trade has requested the consultations mechanism against El Salvador, under the dispute settlement process of the Free Trade Agreement between Central America, the Dominican Republic and the United States of America (CAFTA), after a refusal, on the part of Salvadoran authorities to implement the tariff reduction program outlined in the aforementioned treaty on the import of products originating in Costa Rica.

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