WT/COMTD/PTA/2/2  
 
2 June 2015  
(15-2890)  Page: 1/3  
Committee on Trade and Development 
Dedicated Session on Preferential Trade Arrangements  Original: English/Spanish  
 
   
CHILE - DUTY-FREE AND QUOTA-FREE SCHEME FOR LEAST DEVELOPED COUNTRIES 
 
QUESTIONS AND REPLIES 
 
 The following communication, dated  2 June 2015, is being circulated at the request of the 
delegation of Chile.  
 The document reproduces the questions addr essed to Chile and the responses submitted. 
  
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 Questions from the delegation of the United States 
  Section 2: Regulatory and Procedural Framework  
Question 1 
 
Section 2.4 states that the Ministry of Finance will review the list of beneficiary 
countries every three years, to ensure consis tency with the UN list of least developed 
countries (LDCs). Do changes to the UN list require automatic changes to the list of beneficiaries under Chile’s duty-free and quota-free (DFQF) programme, or can 
beneficiary countries remain on the list at the discretion of the Minist ry of Finance? If a 
country graduates from LDC status in between re views by the Ministry of Finance, is that 
country removed as a beneficiar y immediately, or does it remain a beneficiary until the 
next triennial review? Will Samoa remain eligib le until the next review by the Ministry of 
Finance? Are similar adjustments made if a country is newly designated as an LDC? 
 Reply:  
 The DFQF programme took effect in Chile in 2014 under Law No. 20.690, which eliminates import tariffs on goods from LDCs, with the exception of wheat, wheat flour and sugar. Pursuant to this 
Law, the list of countries benefiting from the programme shall be determined by the Ministry of 
Finance on the basis of the list of LDCs drawn up by the UN in accordance with the criteria established by that organization.  
In order to comply with this legal provision, the Ministry of Finance drafted regulations containing 
the UN's list of LDCs. These regulations, which also govern how the programme operates, are contained in Ministry of Finance Supreme Decree No. 1.432 of 2013 (hereinafter referred to as the 
"Regulations"). 
 In order to ensure that the list of LDCs established by the Ministry of Finance is regularly updated, 
the Regulations provide that every three years the Minister of Finance shall review the Regulations 
and amend them in the event of any changes to the UN's LDC list. However, it should be noted that the Ministry of Finance has the authority to  review and amend these Regulations whenever it 
considers it necessary, following the procedures established for this purpose. 
 WT/COMTD/PTA/2/2 
 
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  Therefore, the review and amendment of the LDC lis t every three years serves only to ensure that 
the list is kept properly up to date, without prejudice to the fact that the Ministry of Finance may amend or alter the LDC list and the Regula tions at any time if deemed necessary. 
 
Accordingly, if a country graduates from LDC st atus following a decision made by the UN, the 
Ministry of Finance will proceed to amend the Regulations so as to update the list as soon as it becomes aware of this fact. In the case of Samoa, this country will soon be excluded from the 
Regulations. 
 Question 2 
 
Box 1 describes the rule of or igin requirements for the programme. Is accumulation of 
inputs among LDCs permitted under the programme?  
Reply:  
 
Decree No. 1.432 does not provide for accumulation among the various LDCs. 
 
Question 3 
 Section 2.8 describes the three categories of  beneficiary countries. Would Chile explain 
why these categories were created? 
 Reply:  
 The Regulations entered into effect progressively among the LDCs, with a view to minimizing the 
internal impact and following up on any problems that might arise from their implementation so 
that adjustments could be made. All this was done to ensure a minimum impact on the application 
of this benefit.  Accordingly, it was decided to categorize the count ries into three groups on the basis of objective 
criteria, taking into account the level of concentration of their exports. The application of the 
benefit began with those countries with the highest export concentration level, as the higher the concentration, the higher the level of vulner ability to changes in external trade flows. 
 
The index used is the merchandise export concentration index described at http://unctadstat.unctad.org/EN . The values used for grouping LDCs are those identified as 
"export concentration" values in the Excel table containing the 2012 data on LDCs and developing 
countries. (http://www.un.org/en/development/des a/policy/cdp/ldc/ldc_data.shtml ) 
 
The first group comprised countries with an export product concentration index greater than 
0.75%; the second group consisted of LDCs with an export product concentration of less than 
0.75% but more than 0.49%; and the third group comprised LDCs with an export product 
concentration of less than 0.49%. 
 The Regulations entered into force in February 2014. During the month of January 2015, the 
benefit took effect for all the LDCs listed. 
 Section 4: Trade Environment  
Question 4 
 
We recognize that the programme entered into force just over a year ago 
(28 February 2014), and most of the bene ficiary countries became eligible on 
1 January 2015. The statistics cited in the factual presentation only cover the period 
ending in 2013. Can Chile provide any update on the early effects of the programme on 
its imports from LDCs, including volu me of trade and product breakdown? 
 WT/COMTD/PTA/2/2 
 
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  Reply:  
 
Chile is presently in contact with the WTO Secretariat concerning its submission of import statistics for 2014 to the Integrated Database. Once the Secretariat has processed the data, Chile will, on 
the basis of this data, circulate a communication pr oviding updated figures relating to imports from 
LDCs.  
Question 5 
 
What does Chile do to inform exporters in  eligible countries of the opportunities 
available under this programme? What is Chile  doing to improve utilization of its DFQF 
programme? 
 Reply:   
 
On 2 May 2014, the Mission of Chile to the WTO submitted a communication to the WTO LDC Group Coordinator (Uganda), informing it  of the Government of Chile's decision to 
eliminate import tariffs for LDCs and asking that this be communicated to the members of the 
group.  Other steps have also been taken with a view to raising awareness of this mechanism: 
 
- Dissemination of Decree No. 1.432 of 28 Februa ry 2014 to Chilean embassies and ambassadors 
in LDCs, with instructions to inform the competent authorities of this mechanism. 
 
- Dissemination of the mechanism during presidenti al events, such as the Chilean President's tour 
of South Africa, Angola and Mozambique in August 2014. 
 
- Activities with ambassadors of African countries in Brazil, to raise awareness of the existence of 
the mechanism and provide information on its benefits for LDCs.  
 
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