WT/REG376/M/1  
 
29 August  2018 
(18-5402) Page: 1/5 
Committee on Regional Trade Agreements  
Eighty -ninth Session    
 
COMPREHENSIVE ECONOM IC AND TRADE AGREEME NT BETWEEN  
COSTA RICA AND COLOM BIA  
(GOODS AND SERVICES)  
NOTE ON THE MEETING OF 19-20 JUNE 2018 
Chairman: Ambassador Julian BRAITHWAITE (United Kingdom)  
1.1.  The 8 9th Session of the Committee on Regional Trade Agreements (hereinafter 'CRTA' or the 
'Committee') was convened in Airgram WTO/AIR/RTA/1 4/Rev.1 dated 7  June 2018.  
1.2.  Under Agenda Item E.III of the Session, the CRTA considered the Free Trade Agreement 
between Costa  Rica and Colombia , goods  and services , (hereinafter  "the Agreement").  
1.3.  The Chairman  said that the Agreement had entered into force on 1 August 2016.  It had been 
notifie d to the WTO by the Parties on 31  October 2016 under Article  XXIV:7(a) of the GATT  1994 
and the Understanding on the Interpretation of Article  XXIV of GATT 1994 as an Agreement 
establishing a free trade area (document  WT/REG3 76/N/1)  and under GATS  Article  V:7(a) as an 
Agreement providing for the liberalization of trade in services within the meaning of Article V of the 
GATS (document S/C/N/ 870). The text  of the Agreement wa s available, together with its Annexes, 
on the Parties' official websites.  The Factual Presentation on the goods and services aspect s 
(document  WT/REG 376/1 dated 10 April 2018) and questions and replies on this Agreement 
(document WT/REG376 /2 dated 13 June 2018) had been distributed.  
1.4.  The presentations of the Agreement by the Parties were supported by a PowerPoint 
presentation.  
1.5.  The representative of Colombia  thank ed the WTO Secretariat and the officials and colleagues 
from Costa Rica for the work carried out to produce the documents and respond to the questions 
raised on the factual presentation.  The Parties  had received questions from three Members , 
focusing  mainly on rules and procedures of origin, customs procedures and requirements, 
cross-border trade in services, telecommunications, and the protection of intellectual property 
rights. She thanked the  Members for their interest in the A greement.  
1.6.  In June  2012, Colombia and C osta Rica had begun  negotiating a free trade agreement, which 
had entered into force on 1  August  2016.  Costa Rica was one of the most dynamic and attractive 
economies in Latin America, and was a country with which Colombia had  maintained strong 
cultural, d iplomatic and trade ties for many years. Furthermore, the Agreement  was an essential 
and natural step towards the consolidation of trade relations with Central America.  
1.7.  Throug h the Agreement, Colombia had gained  access to the market with the  fifth greatest 
purchasing power in Latin America and to an economy that had grown  by 3.9% in 2017.  One of 
the advantages of the A greement was that it had provided  new instruments that allow ed for 
competition in a sophisticated market, the main suppliers of whic h were the United States, China 
and Mexico, while, before the Agreement, Colombia had faced an average MFN tariff of 5.6% 
(11.3% in agriculture).  
1.8.  The Ag reement was particularly relevant, given that Costa Rica was the second largest 
destination for Colombia n exports to Central America, after Panama. Furthermore, since 97% of WT/REG376/M/1  
 
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  sales to this market were goods that were not related to mining or oil, the Agreemen t had helped  
to diversify and expand the country's exportable supply.  
1.9.  The agreed provisions had establ ished the reduction of tariffs for 81% of agricult ural 
products, of which 60% had  had duty -free access since the entry into force of the agreement.  
Moreover, tariff benefits had been  agreed upon for 98% of non -agricultural goods, and over 70% 
of these prod ucts already had duty-free access.  
1.10.   In addition to tariff reductions, and taking into account the importance of trade facilitation 
measures for optimizing the use of agreements, the Agreement allowed  for the issu ance of 
certificates of origin b y digital mea ns, and established  provisions to strengthen cooperation 
between customs authorities through the exchange of information prior to, during and after 
clearance.  Furthermore, it included  specific provisions on the consolidation and mutual recognition 
of autho rized economic operator programmes in each country.  
1.11.   In cross -border trade in services, service providers benefit ed from the principles of national 
and most -favoured -nation treatment; there were deeper transparency commitments, and 
provisions to facilitate payments and transfers between the two countries. Furthermore, specific 
chapters had been  created on financial services, telecommunications, electronic commerce and the 
facilitation of the phys ical movement of individuals providing services.   
1.12.   The A greement was innovative insofar as it contained  a series of clauses on moving towards 
the mutual recognition of degrees and professional licenses.  
1.13.   Bilateral investments were also protected and benefit ed from non -discriminatory treatment 
for investments and investors, the right to the freedom to transfer incoming and outgoing capital , 
and mechanisms to settle disputes between investors and the Government, which had a strong 
focus on non -contentious solut ions. 
1.14.   She emphasize d that the Agreement included  commitments on corporate social 
responsibility  and the obligation to not reduce protection levels with regard to health, safety, the 
environment and labour rights as a means of attracting investment.  The Agr eement was a dynam ic 
free trade agreement that had  been fully utilized by entrepreneurs . Although  only a short amount 
of time had  passed since it had entered i nto force, positive results had  already been observed. In 
2017, Colombia's exports had amounted t o US$240  million, representing an increase of 4% 
compared with the previous year.  In 2017, there had been further development s in the Agreement  
took place , and 20  new tariff lines had been incorporated into the tariff reduction timetables , 
specifically to address the interests of entrepreneurs.  
1.15.   Colombia was grateful  to the WTO Secretariat  and to the Members for their active 
participation, and for the seamless work with  the Costa Rican delegations in Geneva and San José.   
1.16.   The representative of Costa Rica  thanked the Committee for this opportunity to present the 
Free Trade Agreement between Costa Rica and Colombia. Over the past twenty years, Costa Rica 
had been building a strong foreign trade platform; a strategy which, in turn, had become a key 
engine of the  country's growth and had enabled it to boost and diversify its exports. In this 
context, Costa Rica had decided to negotiate a free trade agreement with Colombia. The 
negotiating process had ended in February 2013 and the Agreement had entered into force in 
2016.  
1.17.   He stated that the Agreement was a modern trade instrument that established a legal 
framework with clear, stable and transparent rules that generated confidence and security in trade 
relations between the two Parties. It had  opened up significant opportunities for increasing and 
diversifying Costa Rica's  export s to a country that had figured prominently among its strategic 
partners. Under th e Agreement, Costa Rican exports had access to the Colombian market as a 
whole, thus consolidating the countr y's presence in South America. From the consumer's 
standpoint, the Agreement provided that raw materials and intermediate goods may enter freely, 
which directly enhanced the competitiveness of domestic production. It also established an 
environment conduci ve to increased investment and production linkages. Another tremendously 
valuable feature of interest to Costa Rica was that Colombia was a leader in vital global economic WT/REG376/M/1  
 
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  sectors such as pharmaceuticals, plastic and rubber products, textiles and footwear,  and 
agricultural products. Colombia was also a major source of foreign investment for Costa Rica.  
1.18.   Cost Rica had high expectations in terms of the impact on trade of  the Agreement. Costa 
Rica's  trade with Colombia had remained variable in the last decade, with annual trade averaging a 
value of US$415 million. In 2017, exports had amounted to US$57 million and had involved mainly 
unwrought lead; artificial body parts; tyres; syringes, needles, ca theters and the like; food 
preparations; dosed medicines; articles of iron or steel wire; and caps, lids, stoppers and bung 
covers used in packaging. In the same year, 411 products had been exported, 201 of which had 
been new products. Furthermore, 132 com panies had entered the Colombian market, 48 of which 
had not done so in the previous three years. Efforts were being made to take greater advantage of 
the many opportunities offered by the Agreement. Leading imports included medicines, 
polypropylene, perfu mes and toilet waters, carbon, make up and skincare preparations, and 
fungicides.  
1.19.   During the period 2013 -2017, investment inflows from Colombia had amounted to a total of 
US$692 million or 5% of the total investment received by the country. In 2017, invest ment from 
Costa Rica had amounted to US$184 million and had been destined mainly for the financial, 
industrial, commercial and real estate sectors.  
1.20.   As almost two years had gone by since the Agreement had entered into force, he was  
pleased to take part in t his tr ansparency exercise, which bore  witness to the genuine 
strengthening and expansion of trade links and bilateral investment flows between Costa Rica and 
Colombia. Costa Rica was committed to the multilateral trading system. Trade agreements, as part 
of the system, were a valuable tool for integrating the various economic actors, boosting trade, 
promoting development, and contributing to poverty reduction. An agreement such as the one 
under consideration today, based as it was on WTO disciplines, promot ed economi c growth and 
efficiency in the P arties concerned, thus complementing multilateral trade liberalization.  
1.21.   The Agreement contained  a number of elements that were innovative for Costa Rica, such 
as the interoperability of foreign trade single windows  and the incorporation, for the first time, of 
consumer protection through mechanisms that enable d the relevant authorities to cooperate with 
and notify each other and share information in relation to competition and consumer protection. 
Regarding financia l services, a new commitment had  been introduced whereby both countries 
undertook  to maintain a r egulatory framework that pursued  the integration of their securities 
markets. The Agreement also expanded  upon Authorized Economic Opera tor (AEO) programmes, 
experience  sharing in the field of electronic commerce, and corporate social resp onsibility 
commitments; this had  all been possible thanks to the marked willingness of both countries to 
cooperate using their strengths and to focus on pursuing development.  
1.22.   He concluded by  thank ing not only the WTO Secretariat for the work it had  done, and 
Colombia, but also the delegations that had submitted questions fo r the interest they had  shown in 
this process. He remained  at the Committee's disposal to answer any furthe r questions relating to 
this instrument.  
1.23.   The representative of the European Union  thanked the Parties for the interesting 
presentations and the Secretariat for preparing the Factual Presentation. She also appreciated that 
the Parties had highlighted the no vel features  of the Agreement , such as the AEO scheme. That 
type of information was particularly fruitful to exchange in the CRTA. She recalled that the EU had 
submitted a number of advance questions seeking more information on customs related provisions 
as well as a clarification on the admission of intra -company transferees. Information had also been 
sought  on the non -notified agreements listed in Table 5.1 of the Factual Presentation. The EU 
noted that 6 out of the 10 non-notified agreements were listed in the document WT/REG/W/130 
discussed under the agenda item earlier. The EU commended the Parties for the detailed and 
interesting replies received. They were still under review and the EU reserved its right to submit 
additional questions. The EU had two additional questions. First, regarding paragraph 3.38 of the 
Factual Presentation, w here it was stated that "under the Agreement, the Parties need to notify in 
parallel to the notification submitted to the WTO, all proposed or new technical regulations and  
conformity assessment procedures", t he EU was interested in the  rational e for requiring this 
bilateral notification obligation. Second, concerning cumulation , which was laid down in 
paragraph  3.23, which read: "Based on these conditions, the Parties indic ated that diagonal 
cumulation could be applied to goods originating in the European Union and Mexico but discussions WT/REG376/M/1  
 
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  for its im plementation are still ongoing", t he question by the EU was: "Could the Parties clarify 
how it would affect the diagonal cumulati on process for the rest of Central American countries and 
especially Panama (not a full member of the Central America Economic Integration System) since 
the Agreement between the EU and Central America has a regional scope (6 Central American 
countries)?".   
1.24.   Referring  to the replies to one of its advance questions, the EU commended the Parties for 
the detailed replies they had submitted o n Table 5.1  and looked  forward to receiv ing similar replies 
to the EU's outstanding questions to the LAIA members. The replies received were a good starting 
point to continue a constructive discussion on this issue. Based on the replies, it appeared to the 
EU that some RTAs would need to be notified  such as  Panama's  accession to the Andean 
Community. She also noted that  some RTAs appeared to fall outside the notification obligations 
under  Article XXIV  such as  LAIA cultural goods. For the remaining RTAs, the EU would need more 
clarifications on the chapters on rules of origin, SPS, TBT, and safeguards to know if they were  
identical in all the listed agreements and if they mirrored the same chapters contained in the 
MERCOSUR. The EU would be happy to come back on this kind of exchange in another forum and 
would submit these  in writing.  
1.25.   The representative of Japan  thanked th e Parties for their presentations as well as the 
Secretariat for its comprehensive Factual Presentation. In terms of trade in goods, he commended 
both Parties that had committed to a broad range of liberalization compared to  on an MFN basis. 
He noted that according to the Agreement, the Parties would review some of the lines excluded 
from the Agreement in accordance with future negotiations under the Pacific Alliance. In terms of 
trade in services, the Parties had adopted a negative list approach and appear ed to have achieved 
a higher level of market access. Regarding commitments in financial services, Japan was 
interested in the h ybrid approach which combined both positive and negative list approaches. 
Japan would like to follow -up with the Parties on how t hey would implement the Agreement, in 
particular in the sectors mentioned.  
1.26.   The representative of the United States  thanked the Parties under review and the 
Secretariat for their efforts to prepare the Factual Presentation and to bring this important regio nal 
trade agreement to the Committee for review. She also appreciated the presentations provided by 
the Parties that  had provided useful context on how th e Agreement supported the overall bilateral 
trade relationship and helped to understand the important and ambitious integration efforts under 
way between and among Central and South American economies. On a general note, she 
recognized the broad scope of many elements the United States considered essential components 
of a modern and ambitious trade agreeme nt, including trade facilitation, TBT and SPS, IPRs, 
government procurement, investment and cross -border services, as well as separate chapters on 
telecommunications, financial services and e -commerce. On goods, the factual presentation had  
reflected that,  prior to the Agreement, tariff s applied  to almost all goods trade, with very little 
trade covered by MFN zero duty rates, and therefore the Agreement had had a significant impact 
on reducing tariff level s across a wide range of products. At the end of the retrospective 
implementation periods , coverage  of 95.8% of lines for Costa Rica and 94.6% for Colombia would 
be achieved . She understood that further tariff elimination was possible under future Pacific 
Alliance negotiations. The United States encouraged the Parties to remain ambitious in these 
negotiations. On services, important features of a modern Free Trade Agreement (FTA)  were 
noted,  such as the prohibition of performance requirements and a negative list approach 
scheduling the liberalization of cross -border services and investment. The United States  was 
particularly pleased to see the additional commitments that both Parties had undertaken with 
respect to their existing GATS commitments. She noted th e inclusion of important digital trade 
rules in the Agreement, including the prohibition on applying customs duties to digital products. 
She was encouraged to see many Members including this kind of provision directly in their FTAs , 
and demonstrat ed a clea r common understanding of the WTO's moratorium on customs duties on 
electronic transmissions. The United States was also interested in the inclusion of provisions on 
Governmen t procurement in the Agreement. Noting that both Parties were observers to the GP A, 
she was interested in knowing  if either Party had plans to accede to the GPA. She also drew 
Colombia's attention to Table 5.1 listing participation in other RTAs  which showed that Colombia 
was a party to 10 RTAs that had not been notified to the WTO and  had never benefited from the 
necessary transparency review in the CRTA or the CTD. She urged Colombia to make these 
notifications as expeditiously as possible. She concluded by thanking the Parties for the 
opportunity to review and discuss this important Agreement.  WT/REG376/M/1  
 
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  1.27.   The representative of Costa Rica  thanked the Members for their questions and comments. 
He had taken due note of them so as to follow -up as appropriate . Regarding the question put 
forward by the EU, he gave a preliminary answer. On the notificati on of technical regulation and 
conformity assessment , when a new regulation was notified to the WTO, it had to be submitted at 
the same time to the TBT contact point of the other Party. The objective  was to receiv e the 
information on time and not to wait f or the WTO Secretariat to publish it, which sometimes could 
take a week. For example, if a new regulation was proposed by Costa Rica, when the notification is 
submitted to the WTO it would need to be also sent to the contact point of Colombia. On the issue 
of cumulation of origin Article 3.6,  paragraph 4 of the Agreement state d that "f or the application of 
[cumulation], each Party must have agreed on provisions equivalent to those indicated in 
paragraph 3 [of Article 3.6] with the country or group of non -parties, as well as the conditions that 
the Parties consider necessary for the purposes of their application". According to this provision, 
diagonal cumulation would be applicable to originating products from the EU and Mexico. In the 
case of the other count ries of Central America, including Panama, the Central Am erican Regulation 
on the Origin, did not have an equivalent disposition agreed upon in the Agreement . Consequently , 
the application of cumulation with Central American countries would not be possible in the 
framework of the Agreement . 
1.28.   The representative of Colombia  also thanked the Members for their comments and questions  
which  had been noted and would be transmitted to  her capital. On technical barriers to trade, she 
added that the obligation of transmitting to the contact points of the other Party the information 
when the notification was submitted to the Secretariat of the WTO according to the WTO TBT 
Agreement, was e quivalent to the obligation contained in other trade agreements, including in the 
FTA concluded between the EU and Colombia and Peru. She clarified that t he type of information 
that was to be notified under this provision corresponded  to technical regulati ons, conformity 
assessment procedures  and other  TBT-related  provisions . This benefit ed both Parties as it allowed 
them to understand first -hand what would be included in projected future  technical regulations or  
conformity assessment procedures before these would be notified to the WTO . These were parallel 
process es.    
1.29.   The Chairman  said that consideration of the Goods Aspects of the Free Trade Agreement 
between Costa Rica and Colombia  had allowed the Committee to clarify a number of  questions and 
it could now conclude oral discussion of the RTA in accordance with paragraph 11 of the 
Transparency Mechanism. If any delegations wished to ask follow -up questions they were invited 
to forward submissions in writing to the Secretariat by 26  June 2018 and Parties were asked to 
submit replies in writing by no later than 10 July 2018. In accordance with paragraph 13 of the 
Transparency Mechanism all written submissions, as well as minutes of the meeting would be 
circulated promptly, in all WTO official languages, and would be made available on the WTO 
website.  
1.30.   The Committee took note  of the comments made.  
 
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