WORLD TRADE  
ORGANIZATION  WT/REG134/3 
2 March 2004  
 
(04-0919) 
Committee on Regional Trade Agreements Original:   English 
   
FREE TRADE AREA BETWEEN THE UNITED  STATES AND JORDAN 
 
GOODS ASPECTS
 
 
Communication from the Parties  
 
 
 The following communication, dated 24 February 2004, is being circulated at the request of 
the Delegation of the United States. 
_______________ 
  
I. BACKGROUND INFORMATION ON THE AGREEMENT 
1. Membership And Dates Of Signature, Ratification And Entry Into Force. 
 The Agreement Between the United States of America (United States) and the Hashemite 
Kingdom of Jordan (Jordan) on the Establishment of  a Free Trade Area (Free Trade Agreement) was 
signed on October 24, 2000 and entered into force on December 17, 2001.  The tariff schedules under 
the Agreement went into effect on that date. 
 
2. Type Of Agreement 
 Bilateral Free Trade Agreement. 
 3. Scope 
 The Agreement includes coverage of substa ntially all trade in industrial goods and 
agricultural products and substantially all trade in services.  It incorporates TRIPS-consistent 
standards for copyright protection and contains tr ade-related environmental and labor provisions.  
 
4. Trade Data 
 Statistical data on the evolution of trade betw een the United States and Jordan is presented in 
the Annex.   
II. TRADE PROVISIONS 
1. Import Restrictions 
 1.1     Duties And Charges 
   The Agreement will eliminate tariff and n on-tariff barriers on substantially all trade in 
industrial goods and agricultural products within 10 y ears.  Measuring in terms of either total recent 
bilateral trade in years 2000 and 2001– or in terms of total tariff lines subject to elimination –  the 
Agreement will eliminate all tariff and non-tariff barri ers on over 99 percent of total trade in industrial WT/REG134/3 
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goods and agricultural products.  (T he Agreement exempts only tariffs on tobacco and tobacco 
products from elimination.)  As a general principle, th e tariff reductions will ta ke place in four stages: 
Current tariffs of less than 5 percent ad valorem were phased out by 1 January 2003; those between 5 
and 10 percent will be eliminated by 1 January  2005; those between10 and 20 percent will be 
eliminated by 1 January 2006; and those that are now more than 20 percent will be phased out by 1 
January 2010.  In certain instances, tariffs above 5 percent, including those above 20 percent, may be 
phased out earlier.   The U.S.-Jordanian tariff elimination schedule is available on the USTR website: www.ustr.gov
. The U.S. tariff schedule containing the actua l duties applied is available on the USITC 
website: www.usitc.gov . 
  1.2 Quantitative Restrictions   The Agreement prohibits new quantitative restric tions on trade between the Parties, except as 
permitted by the Agreement.  The Agreement exp licitly allows quantitative restrictions permitted 
under Article XI of GATT 1994, and quantitative rest rictions pursuant to the safeguard provisions 
under the Agreement on Textiles and Clothing.   1.3 Common External Tariff    
 None.  (The Agreement is not a customs union.) 
 
2. Export Restrictions   
 2.1 Duties And Charges 
 
 None apply under the Agreement. 
  2.2 Quantitative Restrictions   The Agreement prohibits new quantitative restric tions on trade between the Parties, except as 
permitted by the Agreement.  The Agreement explic itly allows quantitative controls on U.S. exports 
of logs; quantitative restrictions permitted under Ar ticle XI of GATT 1994; and any other quantitative 
restrictions consistent with WTO rules.  
3. Rules Of Origin 
  The general criteria used for the purpose of dete rmining the origin of products to all articles 
which the Agreement applies include the following.  
  The Agreement’s rules of orig in apply to any article if: 
  1. that article is wholly the growth, product or manufacture of a Party or is a new or 
different article of commerce that has been  grown, produced, or manufactured in a 
Party; 
  2. that article is imported directly fr om one Party into the other Party; and 
  3. the sum of (i) the cost or value of the materials produced in the exporting Party, plus 
(ii) the direct costs of processing operations  performed in the ex porting Party is not 
less than 35 percent of the appraised value of  the article at the time it is entered into 
the other Party. 
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 To meet “country of origin” requirements under the Agreement, an artic le or material, not 
wholly the growth, product, or manufacture of a Pa rty, must be substantially transformed into a new 
and different article of commerce, having a new name, character, or use distinct from the article or material from which it was so transformed.  
 For purposes of determining the 35 percent domestic content requirement under this 
Agreement, the cost or value of materials which are used in the production of an article in one Party, 
and which are products of the other Party, may be  counted in an amount up to 15 percent of the 
appraised value of the article.  Such materials mu st in fact be products of the importing Party under 
the country of origin criteria set forth in this Agreement.   
 
 The Agreement’s rules of origin do not apply to processed citrus products. 
 
4. Standards 
 4.1 Technical Barriers To Trade 
 
 No TBT-specific provisions apply under the Agreement.  WTO rules apply.   4.2 Sanitary And Phytosanitary Measures   The WTO SPS rules apply.  The  Agreement also incorporates Article XX of GATT 1994 and 
its interpretive notes.  The Parties understand th at these measures include environmental measures 
necessary to protect human, animal or plant life or health, as well as measures relating to conservation of living and non-living exhaus tible natural resources.   
 
5.  Safeguards 
 In  Article 10 of the Agreement, both par ties preserve their rights under GATT 1994 and the 
WTO Agreement on Safeguards.  Article 10 of the Ag reement also allows one party to exclude the 
other from global safeguard measures under certain conditions.   Article 10 of the Agreement provides a bila teral safeguard, under which one party may 
temporarily revoke tariff concessions if goods importe d from the other party are a substantial cause of 
serious injury. The procedural rules are very sim ilar to those under the Agreement on Safeguards.  
Use of a bilateral safeguard measure without the consent of the other party is permitted during a 15-
year transition period.  Such a measure may remain in place for a maximum of four years.  The bilateral safeguard measure does not allow a party to raise tariffs to a level higher than its MFN rate.  
 6. Anti-Dumping And Countervailing Measures 
 The agreement contains no provisions for anti-dumping and countervailing measures. 
 
7. Subsidies And State-Aid 
 There are no provisions on subsidies or state aid under the Agreement. 
 8. Sector-Specific Provisions 
 In the Agreement’s  provisions addressing el ectronic commerce contained in Article 7, both 
countries agreed to seek to avoid imposing customs duties on electronic transmissions, imposing unnecessary barriers to market access for digitized products, and impeding the ability to deliver 
services through electronic means.   
 WT/REG134/3 
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 Article 3 of the Agreement covers substantia lly all service and provides for the absence or 
elimination of substantially all discrimination.  Trade in services under the Agreement is described in 
the Parties submission in accordance with the Standard Format for Services (WT/REG/W/14). 
 
9. Other  
 None. 
  
III. GENERAL PROVISIONS OF THE AGREEMENT 
1. Exceptions And Reservations 
 Article 12 states that nothing in the Agreemen t can be construed to require any Party to 
provide information contrary to its essential securi ty interests; to prevent any Party from taking 
necessary actions to protect its security interest s; or to preclude any Party from fulfilling its 
obligations under the United Nati ons Charter for the maintenance of  international peace and security. 
 2. Accession 
 The Agreement does not incl ude provisions for the accession of additional parties.  
 
3. Dispute Settlement Procedures 
 Article 17 of the Agreement creates a multi-step , transparent dispute settlement process.  Any 
dispute that cannot be resolved through consultation may be referred to a pane l of independent experts 
for a non-binding opinion.  If a dispute cannot be settled after panel proceedings are completed, the 
Agreement authorizes the affected party to ta ke any “appropriate and commensurate measure,” 
without specifying the form that this action should  take.  However, the party taking the action must 
act in a manner that is consistent with its WTO obligations.    4. Relation With Other Trade Agreements 
 The Agreement establishes relation with othe r trade agreements in the following areas: 
  Article 1
: Parties establish the Free Trade Agreement consistent with Article XXIV of GATT 
1994 and Article V of the GATS; and reaffi rm obligations under the WTO Agreement. 
 
 Article 2 : Parties accord national treatment consis tent with Article III of GATT 1994 and its 
interpretive notes.   Article 3
: Trade in services under the Agreement is described in the Parties submission in 
accordance with the Standard Format for Services (WT/REG/W/14). 
 
 Article 4 :   The Agreement incorporates provisions on intellectual property rights drawn from 
the WCT, the UPOV Convention, the Patent Cooperation Treaty, the WPPT and the Agreement on Trade-Related Aspects of Intellectual Property Rights (“TRIPS”).    Also in Article 4,  Jordan agrees to acced e to and ratify the World Intellectual Property 
Organization (“WIPO”) Copyright Treaty, 1996 (“WCT”), the WIPO Performances and Phonograms 
Treaty, 1996 (“WPPT”) and the International Conve ntion for the Protection of New Varieties of 
Plants, 1991 (“UPOV Convention”).   WT/REG134/3 
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  Article 6 : The Parties reaffirm their obligations  as members of the International Labor 
Organization (“ILO”) and their commitments under th e ILO Declaration of Fundamental Priniciples 
and Rights at Work and its Follow-up.   Article 9
: The Parties agree to enter into negotiations  with regard to Jordan’s accession to the 
WTO Agreement on  Government Procurement. 
  Article 10
: The Parties preserve their rights under GATT 1994 and the WTO Agreement on 
Safeguards.  
 Article 11
: Parties agree measures imposed for balance of payments purposes must be 
consistent with the WTO Agreement.  
5. Institutional Framework 
 The Agreement establishes a Joint Committee which will meet annually to supervise the 
proper implementation of the Agreem ent and to review the trade re lationship between the Parties. 
  
IV. OTHER 
 In the Agreement’s trade-related environmenta l and labor provisions the two countries affirm 
the importance of not waiving or derogating from their labor or environmental laws in order to 
encourage trade, and commit to effective enforcemen t of their domestic labor  and environmental laws. 
These provisions will not require either country to adopt any new labor or environmental laws, and 
each country retains the right to set its own labor and environmental standards and to change those 
standards.   WT/REG134/3 
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ANNEX 1:  U.S.-JORDAN BILATERAL TRADE 
 
Exports
 
 
• Jordan was the United States’ 73rd largest goods export market in 2002. 
 
• U.S. goods exports to Jordan in 2002 were $404 million, up 19 percent ($65 million) from 
2001, and up 41% from 1994 (the year prior to Uruguay Round). 
 
• The top export categories (2-digit HS) in 2002 were: Cereals (wheat and meslin) ($53 
million), Machinery ($45 million), Aircraft ($43 million), Electrical Machinery ($39 million), 
and Arms and Ammunition ($32 million). 
 
• U.S. exports of agricultural products to Jo rdan totaled $90 million in 2002.  Leading 
categories include: wheat ($42 million), vegetabl es oils (excluding soybean oil) ($10 million), 
and tree nuts ($3 million). 
 
Imports  
 
• Jordan was the United States’ 73rd largest supplier of goods imports in 2002. 
 
• U.S. goods imports from Jordan totaled $412 million in 2002, an 80 percent increase ($183 
million) from 2001, and up 1,321 percent over the last eight years. 
 
• The five largest import categories in 2002 were : Knit Apparel ($275 m illion), Woven Apparel 
($109 million), Precious Stones and Metal (jewel ry and parts) ($12 million), Special Other 
(repaired products) ($3 million), and Salt,  Sulfur, Earth and Stone ($2 million). 
 
Trade Balance  
 
• The U.S. trade balance with Jordan went  from a trade surplus in 2001 ($110 million ), to a 
trade deficit in 2002  of  $8 million . 
 U.S. Goods Trade
 with Jordan (in millions of dollars) 
 
 1980 1985 1990 1994 1997 1998 1999 2000 2001 2002 2003* 
Trade Balance 404 363 298 258 377 337 245 243 110 -8 -194 
Exports 407 377 309 287 402 353 276 317 339 404 482 
Imports 3 14 11 29 25 16 31 73 229 412 676 
 
  
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* Annualized 8 months