U.S.-Colombia Trade Promotion Agreement

CUSTOMS ADMINISTRATION AND TRADE FACILITATION

In administering customs procedures, the U.S.-Colombia TPA establishes rules that are designed to encourage predictability and efficiency. The specific and cutting-edge customs obligations will maximize the gains for Colombian and U.S. exporters once the customs administration and trade facilitation provisions are fully implemented.

Businesses frequently complain that unclear rules, inconsistent interpretation of customs regulations and directives, and arbitrary clearance procedures often result in lengthy delays for the importation of goods into Colombia. The commitments established in the Customs chapter of the U.S. Colombia TPA will ensure that the aforementioned concerns are addressed by the following improvements made to the Colombian customs measures.

Improved Customs Procedures and Rules of Origin

Each day saved in shipping time is worth an estimated 0.8 percent ad-valorem for manufactured goods.* U.S.-Colombia TPA customs and trade facilitation measures will provide significant savings to U.S. exporters in terms of time and money.

*Time as a Trade Barrier by Hummels, David, July 2001

Comprehensive rules of origin- Rules of origin will ensure that only U.S. and Colombian goods receive preferential tariff treatment under the U.S.-Colombia TPA. Rules are designed to be as easy as possible to administer.

Enhanced Transparency – The U.S.-Colombia TPA requires transparency and efficiency in administering customs procedures, including rules of origin. Colombia commits to publish laws and regulations on the Internet, and will be required to take other steps that will promote certainty and fairness in customs administration. This will make it easier for U.S. exporters to understand the Colombian Customs process.

Heightened Predictability. The Agreement will allow exporters to obtain binding advance rulings on tariff classification, origin of goods and other customs matters. This important provision will provide an increased predictability and certainty to exporters, importers and customs administrators, which will minimize delays at the port of entry. The advance rulings will address an existing problem of customs officials issuing varying interpretation of product classification and minimize opportunities for customs officers to misuse authority.

Greater Accountability. Under the Agreement, companies will be guaranteed to have access to both administrative and judicial review of initial customs decisions.

Improved Procedures for Express Delivery Shipments. The demand for express-delivery services is increasing rapidly as a result of the growth of electronic commerce, the globalization of business, and rising demand by manufacturers for outsourced logistic services. The Colombia-TPA responds to that demand by requiring that, within two years after the date the Agreement takes effect, Colombia must provide a separate, expedited customs procedure for express shipments through electronic submission and processing of customs information needed for the release of an express shipment prior to the arrival of the shipment itself. Most importantly, the Agreement obligates Colombia to clear express shipments from the port within six hours of submission of all necessary documents and with no maximum weight or value limitations.

Greater Customs Efficiency through Information Technology. Responding to U.S. exporters’ requests, the Agreement promotes the use of information technology, including the electronic submission of information and automated release of goods. This will help expedite procedures for the release of goods, thereby saving companies time and money.

Information Sharing - Both the U.S. and Colombia agree to share information to combat illegal trans-shipment of goods.