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Product Duty Rates for Korea, Colombia, & Panama FTAs Available

October 6, 2011 by Barbara Chaves|Top News

The International Trade Administration, Office of the U.S. Trade Representative, and the Commerce Department all have useful information regarding the pending free trade agreements with Korea, Colombia, and Panama. ITA has a tool that allows users to search each of the pending FTAs by tariff number to see the resulting duty rates over time for qualifying goods. USTR also has information on the pending FTAs by sector, as well as fact sheets, legal texts of the three agreements with duty rates, and the implementing legislation. Commerce has overviews of each agreement.

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(On October 3, the President sent all three of the FTA implementing bills to Congress and called for their passage, along with H.R. 2832, which contains GSP and TAA renewal and MPF changes. On October 5, the House Ways and Means Committee favorably reported the implementing legislation for the FTAs, clearing the way for their formal consideration on the House floor. See ITT’s Online Archives 11100603 for summary.)

FTA Tariff Tool of Year-by-Year Duty Rates, Etc. from ITA

With the ITA’s FTA Tariff Tool, users can see the current and future tariffs applied to their qualifying products, as well as the year in which those products would become duty-free. As the tariff rates are for qualifying goods, each tariff-specific page includes a link to the rules of origin (such as tariff-shift rules for originating goods) and any product-specific rules of origin.

The database covers both exports and imports under the pending FTAs. For example, U.S.-originating exports of vitamin B12 under the KORUS would become duty-free in the first year, from the current duty of 6.5%; and imports of certain South Korea-originating paints and varnishes would become duty-free in the first year, from a current duty of 3.6%.

In addition, by combining sector and product groups, trade data, and the tariff elimination schedules, users can also analyze how various key sectors are treated under the pending FTAs.

Limited data on ag and textile products. Currently, the database focuses mostly on tariff and trade information for industrial products, with only limited information on agricultural and textile products. ITA states that it is working to add more such products and information to the database.

FTA Tariff Tool is available here.

(The site also provides the same information for existing FTAs. In addition, it has a disclaimer which states that while every effort has been made to ensure accuracy, the actual tariff classification and assessment of duties is up to the customs authorities in the U.S. or the FTA partner countries. See ITT’s Online Archives 11082402 for previous summary of ITA’s FTA tariff tool.)

Complete FTA Texts and All Duty Rates (Including Ag and Textiles) from USTR

The USTR site has the complete text of each of the three pending FTAs as well as the text of the implementing legislation and supporting documentation for each.

Under the legal text of each FTA, there is tariff information for all affected products, national treatment and market access information (including base rates and tariff-reduction staging categories), rules of origin, trade facilitation information, etc. For example:

KORUS Complete Final Text: (partial list of contents follows)

Colombia TPA Complete Final Text: (partial list of contents follows)

Panama TPA Complete Final Text: (partial list of contents follows)

Information by Sector also Available on USTR Site

For each of the pending FTAs, USTR also provides information by sector that profiles the current trade and tariff environment for U.S. exporters, summarizes the sector-specific market access results of the agreements (including the overall duty rate reduction schedule for the sector), assesses foreign competition in that market, and describes non-tariff barriers addressed by the agreement for exporters in each sector.

USTR information on the pending FTAs available here.

Many Duty Rates Would Go to Zero Immediately, Others Phase Out over 10 Years

According to Commerce’s overview of each FTA, many duty rates would go to zero immediately with others phasing out over 10 years as follows:

KORUS. Within five years of enactment of the U.S.-South Korea Free Trade Agreement (KORUS), over 95% of bilateral trade in consumer and industrial products would become duty free and most remaining tariffs would be eliminated within 10 years. For agricultural products, KORUS would immediately eliminate or phase out tariffs and quotas on a broad range of products, with almost two-thirds (by value) of Korea’s agriculture imports from the United States becoming duty free upon enactment. KORUS also addresses non-tariff barriers and has provisions on cross-border services, telecommunications, and electronic commerce.

Panama TPA. Under the U.S.Panama Trade Promotion Agreement, over 87% of U.S. exports of consumer and industrial products to Panama will become duty-free immediately, with remaining tariffs phased out over 10 years. U.S. products that will gain immediate duty-free access include information technology equipment, agricultural and construction equipment, aircraft and parts, medical and scientific equipment, environmental products, pharmaceuticals, fertilizers, and agro-chemicals. U.S. agricultural exports will also benefit. Panama will immediately eliminate duties on high-quality beef, frozen turkeys, soybeans, soybean meal, crude soybean and corn oil, almost all fruit and fruit products, wheat, peanuts, whey, cotton, and many processed products.

Colombia TPA. Under the U.S.-Colombia Trade Promotion Agreement, over 80% of U.S. exports of consumer and industrial products to Colombia would become duty free immediately, with remaining tariffs phased out over 10 years. Key U.S. exports would gain immediate duty-free access to Colombia, including almost all products in the agriculture and construction equipment, aircraft and parts, auto parts, fertilizers and agro-chemicals, information technology equipment, medical and scientific equipment, and wood sectors.

Commerce information available here.