WT/REG308/1  
 
14 April 2014  
(14-2320)  Page: 1/56  
Committee on Regional Trade Agreements   
 
 
 
FACTUAL PRESENTATION 
FREE TRADE AGREEMENT BETWEEN PERU AND MEXICO 
(GOODS AND SERVICES) 
Report by the Secretariat 
This report, prepared for the consideration of the Free Trade Agreement between Peru 
and Mexico has been drawn up by the WTO Secretariat on its own responsibility and in full consultation with the Parties. The report  has been drawn up in accordance with the 
rules and procedures contained in the Decision for a Transparency Mechanism for 
Regional Trade Agreements (WT/L/671). 
Any technical questions arising from this report may be addressed to Maria Donner 
Abreu (tel: +41 22 739 5244). Any statistical questions arising from this report may 
be addressed to Ms. Alejandra Barajas (tel: +41 22 739 6425). WT/REG308/1 
 
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TABLE OF CONTENTS 
Page 
1   TRADE ENVIRONMENT ................................................................................................. 4  
1.1   Overview .................................................................................................................. 4  
1.2   Merchand ise trade ..................................................................................................... 4  
1.3   Trade in servic es and inve stment ................................................................................. 6  
2   CHARACTERISTIC ELEMEN TS OF THE AG REEMENT ...................................................... 9  
2.1   Background  Information ............................................................................................. 9  
3   PROVISIONS ON TRADE IN GOODS ........................................................................... 10  
3.1   Import duties and charges,  and quantitative  restrict ions ................................................ 10 
3.1.1   Genera l provisions ................................................................................................. 10 
3.1.2   Liberalization of  trade and ta riff lines ........................................................................ 12 
3.1.3   Liberali zation schedule............................................................................................ 14 
3.1.3.1   Peru .................................................................................................................. 14 
3.1.3.2   Mexico ............................................................................................................... 15 
3.1.4   Tariff-rate quotas ................................................................................................... 17 
3.2   Rules of origin .......................................................................................................... 17 
3.3   Export duties and charges,  and quantitative  restrictions ................................................. 19 
3.4   Regulatory provisions on trade in goods ....................................................................... 19 
3.4.1   Standards ............................................................................................................. 19 
3.4.1.1   Sanitary and phytosanitary measures .................................................................... 19 
3.4.1.2   Technical barriers to trade .................................................................................... 20 
3.4.2   Safeguard mechanisms ........................................................................................... 21 
3.4.2.1   Global safeguards ............................................................................................... 21 
3.4.2.2   Bilateral safeguards ............................................................................................. 21 
3.4.3   Anti-dumping and countervailing measures ............................................................... 22 
3.4.4   Subsidie s and State-aid .......................................................................................... 23 
3.4.5   Customs-re lated procedures .................................................................................... 23 
4   PROVISIONS ON TRADE IN SERVICES AND IN VESTMENT ......................................... 24  
4.1   Scope and definitions ................................................................................................ 24 
4.2   Denial of benefits ..................................................................................................... 25 
4.3   General provisions on trade in services ........................................................................ 26 
4.3.1   Mark et acce ss ....................................................................................................... 26 
4.3.2   National and MFN tr eatment .................................................................................... 26 
4.3.3   Commercial presence ............................................................................................. 28 
4.3.4   Movement of  natural persons .................................................................................. 28 
4.3.5   Performanc e requirements ...................................................................................... 29 
4.3.6   Senior management  and board of  direct ors ............................................................... 30 
4.4   Liberalization commitments ........................................................................................ 30 WT/REG308/1 
 
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  4.4.1   Peru's libera lization co mmitments ............................................................................ 31 
4.4.2   Mexico's liber alization co mmitments ......................................................................... 34 
4.5   Regulatory provisions ................................................................................................ 37 
4.5.1   Domestic regulation ............................................................................................... 37 
4.5.2   Recognition ........................................................................................................... 38 
4.5.3   Subsidies .............................................................................................................. 38 
4.5.4   Safeguards ........................................................................................................... 38 
4.5.5   Other investment -related pr ovisions ......................................................................... 39 
4.6   Sector specific provis ions on trade in services ............................................................... 39 
4.6.1   Financial Services .................................................................................................. 39 
5   GENERAL PROVISIONS  OF THE AGREEMENT ............................................................. 40  
5.1   Tran sparency ........................................................................................................... 40 
5.2   Current payments and capital movements .................................................................... 40 
5.3   Exceptions ............................................................................................................... 41 
5.4   Accession and Withdrawal .......................................................................................... 41 
5.5   Institutio nal framework ............................................................................................. 41 
5.6   Disput e settlement ................................................................................................... 42 
5.7   Relationship with other agr eements concluded by the Parties .......................................... 44 
5.8   Intellectual property rights ......................................................................................... 46 
5.9   Ot hers .................................................................................................................. .. 47 
ANNEX 1 ....................................................................................................................... . 48 
ANNEX 2 ....................................................................................................................... . 53 
ANNEX 3 ....................................................................................................................... . 54 
 WT/REG308/1 
 
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Key Facts 
 
Parties to the Agreement:  Mexico and Peru 
 
Date of Signature:   6 April 2011 
 
Date of Entry into Force: 1 February 2012 
 
Date of Notification:  22 February 2012 
 
Full implementation :  1 January 2023 
 
 
1  TRADE ENVIRONMENT 
1.1  Overview 1.1.  The Free Trade Agreement (here after "the Agreement") between Peru and Mexico is the 
twelfth Regional Trade Agreement (RTA) notified by  Peru to the WTO and the sixteenth notified by 
Mexico.
1 
1.2.  The size of Mexico's and Peru's economies differ greatly. In 2012, the GDP of Mexico totalled 
US$1,178.0 billion, which is 6 times bigger than that of Peru (US$197.0 billion).2 Mexico and 
Peru's participation in world trade also differs significantly. With merchandise exports of US$370.8 billion and imports of US$380.5 billion in 2012 (2.02% in world exports and 2.05% in world imports), Mexico ranked as the world's 16
th largest exporter and 14th larger importer. As for 
Peru, it ranked as the world's 60th largest exporter and 59th largest importer, with exports 
amounting to US$45.6 billion and imports US$42.5 billion in the same year (0.25% and 0.23% in world exports and imports, respectively). 
1.3.  With regard to services, Mexico was the 43
rd largest exporter and 34th largest importer in 
2012. In that year, its exports in services reached US$16.0 billion, while imports were much higher at US$25.2 billion (0.37% in world exports and 0.61% in world imports). In the same year, 
Peru ranked as the world's 75
th and 66th largest services exporter and importer accounting for 
0.10% of world exports - at US$4.2 billion - an d 0.16% of world imports - at US$6.3 billion. 
1.2  Merchandise trade 1.4.  Trade flows between the Parties are low and,  with the exception of Peruvian imports from 
Mexico, represent a small share in each Party's trade. In 2012, Peru was Mexico's 14
th and 15th 
largest export and import partner, with 0.4% of its total exports and imports. Mexico was Peru's 
21st largest exporter, but a significant shift occurs as regards imports, with Mexico being Peru's 7th 
main supplier of imports, accounting for 0.9% and 4% of its total exports and imports, 
respectively. 
1.5.  Chart 1.1 present the trends in global and intra-Party merchandise between 2000 and 2012. 
Exports to, and imports from, the world for both Mexico and Peru have steadily increased over this 
period, with the exception of 2009 and the global economic crisis. By 2010, however, trade levels 
had in the case of Peru already by-passed those of 2008, while those of Mexico had returned to 
their 2008 levels. Peru has since 2002 been in trade surplus vis-à-vis the world. Mexico, in turn, 
has had a small deficit with the world throughout the period under review, though since 2009 
imports and exports are at about the same level. 
1.6.  As for bilateral trade, figures show in ge neral a trade surplus for Mexico during the period 
under consideration. Peruvian imports from Mexico continued to increase during the whole period 
                                               
1 Source : WTO Regional Trade Agreements Database, 
http://rtais.wto.org/UI/PublicMaintainRTAHome.aspx.  
2 The source for statistics in this section is the WTO Trade Profiles (2012) and the WTO Statistics 
Database. GDP data are given in current prices. Data used in merchandise trade charts are from Comtrade. WT/REG308/1 
 
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  with the exception of 2009 - year in which trade with world has also decreased - while exports 
have fluctuated.  
Chart 1.1 Peru and Mexico: Bilateral an d total merchandise trade, 2000-2012 
0.000.250.500.751.001.251.501.752.00
0612182430364248
2000 2002 2004 2006 2008 2010 2012A. Peru (2000-2012)
(USD Billions)
Imports from Mexico (Right Axis)
Exports to Mexico (Right Axis)
Total Imports
Total Exports
0.000.250.500.751.001.251.501.752.00
050100150200250300350400
2000 2002 2004 2006 2008 2010 2012B. Mexico (2000-2012) 
(USD Billions)
Imports from Peru (Right Axis)
Exports to Peru (Right Axis)
Total Imports
Total Exports
 
 
Source: UNSD Comtrade.  
1.7.  The commodity structure of trade among th e Parties and with the world in 2009-2011 by 
HS Section is reported in Chart 1.2. In the case of Peru, three of the four main categories of 
imports are equally important in bilateral and global imports - namely machinery, chemicals and vehicles - while minerals are important in its global imports and base metals in bilateral imports. 
Peruvian imports of the former three categories from Mexico account for around three-quarters of 
bilateral imports. In the case of Mexico, the structure of its global imports differs from that of its imports from Peru; though two of the four main categories are the same, they have significantly 
different levels of importance. Mexican imports of minerals and base metals (the two common 
categories) and articles of wood account for a little less than three-quarters of its imports from Peru.  
1.8.  While Mexico and Peru have significantly different global export structures, their three main 
export categories account for around 70% of expo rts to the world. Mexico's three main global 
exports are machinery, vehicles and minerals, while Peru's global exports are mainly minerals, precious stones and base metals.  WT/REG308/1 
 
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  Chart 1.2 Peru and Mexico: product compositi on of merchandise trade, annual average 
(2009-2011) 
 
38
231187527Peru's Global Exports(%)
38
98887333210Mexico's Global Imports(%)
46
121075532
9Mexico's imports from Peru (%)37
17155333332223Mexico's Global Exports (%)
25
15
10 109754438Peru's Global Imports (%)
42
16169449Peru's imports from Mexico(%)
Total: US$ 1.1 billion Total: US$ 30 billion
Total: US$ 296 billion Total: US$ 36 billionTotal:  US$ 293 billion
Total:  US$ 425 million
Vegetables
Prepared foods
MineralsChemicals
Plastics, rubber
Wood ArticlesPulp, Paper
Precious stonesBase metals
VehiclesOptical
OtherMiscellaneous Machinery Textiles
 
 
Source: UNSD Comtrade. 
 
1.3  Trade in services and investment 
1.9.  In 2011, as indicated in paragraphs 1.2 and 1.3.   above, and in Tables 1.1 and 1.2 below, 
Peru's services exports, at US$4.6 billion, was around 11 times smaller than the exports of goods, 
while the ratio for imports (US$6.7 billion) was 6 times smaller. The corresponding ratio for Mexico 
was 22 times smaller for exports, and 14 times smaller for imports. However, there remain substantial gaps in services data for both countries. Global services trade for both Parties shows that during 2009-2011 they were constant net impo rters of services, and also that both imports 
and exports have been increasing. While data on trade in commercial services are available, 
neither Party reports bilateral trade data.  WT/REG308/1 
 
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  Table 1.1 Peru: Trade in commercia l services with world, 2000-2011 
Billion $  
Service Item Total Commercial Services Exports 2000 
2001 
2002 
2003 
2004 
2005 
2006 
2007 
2008 
2009 
2010 
2011 
Total exports 1.4 1.3 1.3 1.6 1.9 2.2 2.5 3.0 3.5 3.5 3.8 4.6 
Transportation services 0.2 0.3 0.3 0.3 0.4 0.4 0.5 0.6 0.8 0.8 0.9 1.0 
Travel 0.8 0.7 0.8 1.0 1.1 1.3 1.6 1.7 2.0 2.0 2.3 2.7 
Communications 0.1 0.1 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
Construction … … … … … … … … … … … … 
Insurance 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.3 0.2 0.3 0.2 0.2 
Financial 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 
Computer and 
information … … … … … … … 0.0 0.0 0.0 0.0 0.0 
Royalties and licence 
fees 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 
Other business services … … … … … … … … … … … … 
Personal, cultural, and 
recreational … … … … … … … 0.0 0.0 0.0 0.0 0.0 
Service Item Total Commercial Services Imports 2000 
2001 
2002 
2003 
2004 
2005 
2006 
2007 
2008 
2009 
2010 
2011 
Total imports 2.2 2.3 2.3 2.5 2.6 3.0 3.3 4.2 5.6 4.6 5.8 6.7 
Transportation services 0.9 0.9 0.9 0.9 1.1 1.3 1.4 1.8 2.6 1.7 2.5 2.8 
Travel 0.4 0.5 0.6 0.6 0.6 0.8 0.8 1.0 1.1 1.1 1.3 1.4 
Communications 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 
Construction … … … … … … … 0.1 0.2 0.0 0.1 0.1 
Insurance 0.1 0.2 0.2 0.3 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.6 
Financial 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 0.1 
Computer and 
information … … … … … … … 0.1 0.2 0.2 0.2 0.2 
Royalties and licence 
fees 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2 
Other business services … … … … … … … 0.6 0.8 0.8 0.9 1.1 
Personal, cultural, and 
recreational … … … … … … … 0.0 0.0 0.0 0.0 0.0 
 Source: UNCTADStat.  
Table 1.2 Mexico: Trade in commerc ial services with world, 2000-2011 
Billion $  
Service Item Total Commercial Services Exports 2000 
2001 
2002 
2003 
2004 
2005 
2006 
2007 
2008 
2009 
2010 
2011 
Total exports 12.8 11.9 12.0 12.2 13.6 15.6 15.8 17.1 17.6 14.7 15.2 15.3 
Transportation services 1.1 1.0 0.9 0.9 1.1 1.4 1.5 1.5 1.8 1.3 1.1 0.8 
Travel 8.3 8.4 8.9 9.4 10.8 11.8 12.2 12.9 13.4 11.5 12.0 11.9 
Communications 1.2 0.8 0.6 0.4 0.4 0.5 0.5 0.4 0.3 0.2 0.2 0.2 
Construction … … … … … … … … … … … … 
Insurance 1.8 1.4 1.2 1.2 0.9 1.6 1.3 2.0 2.0 1.6 1.8 2.3 
Financial … … … … … … … … … … … … 
Computer and information … … … … … … … … … … … … 
Royalties and licence fees 0.0 0.0 0.0 0.1 0.1 … … … … … … … 
Other business services … … … … … … … … … … … … 
Personal, cultural, and 
recreational 0.3 0.3 0.4 0.3 0.4 0.4 0.4 0.3 0.1 0.1 0.1 0.1 WT/REG308/1 
 
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  Service Item  Total Commercial Services Imports  2000 
2001 
2002 
2003 
2004 
2005 
2006 
2007 
2008 
2009 
2010 
2011 
Total imports 15.0 15.1 15.3 15.8 17.6 19.1 20.3 21.8 23.6 20.5 21.6 24.9 
Transportation services 6.2 6.0 5.7 5.7 6.7 8.1 8.9 9.9 11.9 9.3 10.8 12.1 
Travel 5.5 5.7 6.1 6.3 7.0 7.6 8.1 8.5 8.6 7.2 7.3 7.8 
Communications 0.4 0.3 0.2 0.3 0.2 0.1 0.1 0.1 0.1 0.1 0.1 0.1 
Construction … … … … … … … … … … … … 
Insurance 1.4 1.9 2.2 2.3 2.3 2.3 2.0 2.8 2.7 3.2 2.6 4.1 
Financial 0.9 0.6 0.2 0.4 0.4 0.5 0.4 0.3 0.1 0.4 0.5 0.5 
Computer and information … … … … … … … … … … … … 
Royalties and licence fees 0.4 0.4 0.7 0.6 0.8 0.1 0.5 … … … … … 
Other business services … … … … … … … … … … … … 
Personal, cultural, and 
recreational 0.2 0.2 0.3 0.2 0.2 0.3 0.3 0.3 0.2 0.3 0.3 0.3 
 
Source: UNCTADStat.  
1.10.  As regards inward foreign direct investment (FDI), as can be seen in Tables 1.3 and 1.4 
below, for stocks for Peru, as well as both inward and outward stocks for Mexico, there has been a constant upward trend. Bilateral FDI data is only available from Peru. 
Table 1.3 Peru and Mexico's foreign dire ct investment with the world, 2000-2011 
Billion $  
Year Peru Mexico 
FDI flow FDI stock FDI flow FDI stock 
Outward Inward Outward Inward Outward Inward Outward Inward 
2000 - 0.8 0.5 11.1 0.4 18.1 8.3 102.0 
2001 0.1 1.1 0.6 11.8 4.4 29.9 55.6 141.9 
2002 - 2.2 0.7 12.5 0.9 23.9 48.2 139.7 
2003 0.1 1.3 0.8 12.9 1.3 18.7 44.6 148.2 
2004 - 1.6 0.9 13.3 4.4 24.8 51.4 181.6 
2005 - 2.6 1.0 16.5 6.5 24.4 64.2 226.6 
2006 - 3.5 1.5 20.5 5.8 20.1 72.0 256.6 
2007 0.1 5.5 2.3 26.8 8.3 31.5 85.4 290.2 
2008 0.7 6.9 1.7 32.3 1.2 27.1 66.8 231.0 
2009 0.4 6.4 2.3 34.5 7.0 16.1 81.2 277.9 
2010 0.3 8.5 3.3 43.0 13.6 20.7 104.3 330.2 
2011 0.1 8.2 3.1 51.2 8.9 19.6 112.1 302.3 
 
- Not available. 
 Source: UNCTADStat. 
 
Table 1.4 Peru's foreign direct investment with Mexico, 2009-2011 Billion $  
FDI Mexico 
Outward Inward 
2009 2010 2011 2009 2010 2011 
Total FDI stocks … …  … 0.47 0.47 …  
Total FDI flows 0.0 0.0 … 0.01 0.0 … 
 
- Not available.  Note: FDI bilateral data was collected using Proinversi on's Foreign Investment re gistry forms for firms/ 
investors following the dispositions under Article 19 from the legislative decree No°662.  
 Source: Banco Central de la Reserva del Perú, Proinversion. WT/REG308/1 
 
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  2  CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
2.1  Background Information 2.1.  The Agreement between Peru and Mexico was signed on 6 April 2011 and entered into force 
on 1 February 2012, following ratification by both Parties.
3 The Agreement was concluded in the 
context of the Latin American Integration Association (LAIA), where it is registered as the 
Economic Complementarity Agreement number 67 (ACE No 67). Prior to that, their bilateral 
relations were mainly conducted under the auspices of LAIA's bilateral ACE No 8, in force since 
March 1987.4 Given the limited scope of the latter,5 the parties agreed in December 2005 to 
launch negotiations towards the conclusion of a free-trade agreement also encompassing services and investment.  
2.2.  The Agreement was notified to the WTO jointly by its Parties on 22 February 2012, under 
Article XXIV:7(a) of the GATT 1994 for its goods aspects, and Article V of the GATS for its services 
aspects (WT/REG308/N/1 and S/C/N/616). 
2.3.  The Agreement consists of 19 Chapters and five Annexes which form an integral part of the 
Agreement (see Box 2.1). 
Box 2.1 Structure of the Agreement 
Chapters, Sections 
& Annexes Title 
CHAPTER I: INITIAL PROVISIONS 
CHAPTER II: GENERAL DEFINITIONS 
CHAPTER III: MARKET ACCESS 
Section A Definitions 
Section B National Treatment  
Section C Tariff Elimination 
Section D Non-Tariff Measures 
Section E Special Customs Regimes  
Section F Committee on Market Access  
CHAPTER IV: RULES OF ORIGIN AND PROCED URES RELATED TO ORIGIN 
CHAPTER V: RECOGNITION AND PROTECTION OF  DENOMINATIONS OF ORIGIN 
CHAPTER VI: SAFEGUARD CLAUSES 
Section A Global Safeguard Measures  
Section B Bilateral Safeguard Measures  
CHAPTER VII: SANITARY AND PHYTOSANITARY MEASURES  
CHAPTER VIII: TECHNICAL BARRIERS TO TRADE 
CHAPTER IX: UNFAIR PRACTICES IN INTERNATIONAL TRADE 
                                               
3 By Peru and Mexico in July and December 2011. Final Decrees approving the Agreement can be found 
at http://www.acuerdoscomerciales.gob.pe/images/stories/mexico/DS_001_2012_MINCETUR.pdf  for Peru and 
http://dof.gob.mx/nota_detalle.php?codigo=5228290&fecha=09/01/2012  for Mexico.  
4 The LAIA's Regional Agreement on a Regional Tariff Preference (PAR No 4) was never applied on trade 
between these two countries. 
5 Mexico granted preferences on 613 HS 8 digit-lines, of which 157 were duty-free; the corresponding 
figures for Peru were 252 and 102. However, in some case s, they only applied partially to the line or were 
subject to TRQs. According to the LAIA Secretariat, if  MFN duty-free trade is deducted from bilateral trade, 
2010 trade carried out under the ACE No 8 preferences amounted, at the maximum, to 13.1% of Mexican 
imports from Peru and 1.2% of Peruvian imports from Mexico,5 with a part of that benefiting for complete tariff 
elimination. WTO figures show that, at the same year, Mexican imports from Peru benefiting from MFN duty-free reached 71.2% and 55% vice-versa. WT/REG308/1 
 
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  Chapters, Sections 
& Annexes Title 
CHAPTER X: CROSS-BORDER TRADE IN SERVICES 
CHAPTER XI: INVESTMENT 
Section A General Provisions 
Section B Protection of the Investment 
Section C Dispute Settlement between a Party an d an Investor of the Other Party 
CHAPTER XII: FINANCIAL SERVICES 
CHAPTER XIII: TEMPORARY ENTRY AND STAY FOR BUSINESS PERSONS 
CHAPTER XIV: MUTUAL RECOGNITION OF ACADEMICAL CERTIFICATES, TITLES AND/OR 
DEGREES 
CHAPTER XV: DISPUTE SETTLEMENT 
Section A Dispute Settlement 
Section B Internal Procedures 
CHAPTER XVI: TRANSPARENCY 
CHAPTER XVII: ADMINISTRATION OF  THE AGREEMENT 
CHAPTER XVIII: EXCEPTIONS 
CHAPTER XIX: FINAL PROVISIONS 
  
Annex I Non-conforming measures (Peru and Mexico) 
Annex II Future measures (Peru and Mexico) 
Annex III Market-access (Peru and Mexico) 
Annex IV Exceptions to Most-Favoured Nation Treatment (Mexico only) 
Annex V Activities reserved to the State (Mexico only) 
Annex VI Financial Services (Peru and Mexico) 
 
Source: WTO Secretariat based on the Agreement. 
 
3  PROVISIONS ON TRADE IN GOODS 
3.1  Import duties and charges,  and quantitative restrictions 
3.1.1  General provisions 
3.1.  The Parties agree to establish a free trade area within a maximum transition period of 11 
years, with the latest instalment foreseen for 1 January 2023.6  
3.2.  The Parties reconfirm the rights and ob ligations in force between them under the WTO 
Agreement and other agreements to which they are party; in cases of incompatibility, the provisions of the Agreement take precedence. 
3.3.  All national treatment provisions of this Ag reement, whether in respect of goods, services or 
investment, are to be interpreted, as far as state or regional levels of government are concerned, 
to mean a treatment no less favourable than the most favoured treatment granted by such local government to products/services suppliers/investors or investments of the Party it is an integral 
part of. 
                                               
6 While originally for Peru the last instalment was also foreseen for 2023, an unilateral liberalization has 
modified this and the last instalment will now take place in 2021. WT/REG308/1 
 
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  3.4.  National treatment on trade in goods applies as per Article 3.3, at all levels of government. 
However, it does not apply with respect to products for which import or export restrictions are allowed, as per the Annex to Articles 3.3 and 3.6. For Mexico, these products include mineral fuels, retreaded tyres, worn clothes, diamonds, used vehicles, chassis for vehicles and used goods. For 
Peru, these products include worn clothes, used vehicles and engines (including part of the 
vehicles), retreaded tyres and machinery and equipment using radioactive energy.  
3.5.  Article 3.4 prohibits increasing, or adopting new, import duties on originating products 
included in the Tariff Elimination Programme (TEP). TEP details are included in the Annex to 
Article 3.4-A and the Parties' individual Annexes. For products not included in the TEP, the Agreement makes clear that WTO rights and obligations apply.  
3.6.  Article 3.4.5 clarifies that imports of used goods may be denied preferential treatment under 
the Agreement, irrespective of whether or not their HS classification so specifies; that exclusion 
does not however apply to products listed in Annex to Article 3.4-B - namely certain used automotive products and other automatic regulating or controlling instruments and apparatus.
7 
3.7.  The Article also specifies that duty may be increased (i) if it had been unilaterally reduced, 
and up to levels not higher that those specified under the TEP; and (ii) if authorized following a WTO dispute. Further, nothing in the Agreement prohibits Peru from maintaining the specific duties 
resulting of the application of its price-band system for certain basic foodstuffs 
(see paragraph 3.17.   below). 
3.8.  The first tariff reduction took place on 1 Fe bruary 2012; future reductions will take place on 
1 January of each year. Reductions will take place on the base rate, that corresponds to the MFN 
rate of 2006.   
3.9.  No automatic rendezvous clause is provided for with respect to trade liberalization. However, 
upon a Party's request, consultations will take plac e regarding acceleration of the TEP; in case of 
agreement, the Administrative Commission is to adopt a decision.  
3.10.  Article 3.6 includes a general prohibition on restrictions on imports from the Parties, 
including quantitative restrictions (QRs);
8 the exceptions are as follows: 
a. QRs explicitly allowed elsewhere in the Agreement; 
b. QRs authorized under Article XI of the GATT 1994 and its interpretative notes, which are 
made an integral part of the Agreement9; 
c. price undertakings agreed in the context of dumping and subsidies proceedings; 
d. measures listed in Annex to Articles 3.3 and 3.6 (see paragraph 3.4.   above); and 
e. restrictions authorized by the WTO Dispute Settlement Body. 
3.11.  Article 3.7 incorporates in the Agreement the WTO Agreement on Import Licensing 
Procedures, but reduces the maximum period for th e granting and expedition of the licence to 
20 working days, from a maximum of 30 or 60 days.10 
3.12.  In accordance with Article 3-8, Parties reaffirm the rights and obligations of Article VIII of 
the GATT 1994. Parties also agree to a mutual exemption of consular transactions or 
requirements, including fees and charges connected with importation, on imports from the other 
                                               
7 These are 8407.34, 8407.90, 8408.10, 8408.20, 8408.90, 8409.91, 8409.99, 8411.11, 8411.82, 
8413.30, 8427.20, 8428-8430,8436, 8474, 8479, 8701-87.05, 8708.40 and 9032.89. 
8 The Article also prohibits export rest rictions, as explained in Section 3.3. 
9 The relevance of Article XI is to be seen in light of  stricter disciplines in force since the entry into force 
of GATT 1994. 
10 For non-automatic licensing, the periods foreseen in the WTO Agreement is 30 days on a first-come- 
first-served basis and 60 days if all applications are considered simultaneously, with automatic licence being granted within 10 working days. WT/REG308/1 
 
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  Party. Parties are to make available through Internet information on fees and charges imposed in 
relation to importation and exportation.   
3.13.  Articles 3.10-3.13 deal with special customs regimes, including temporary entry of goods. 
Article 3.10 prohibits new, or increase in existing, tariff exemptions if these are based on 
compliance with performance requirements, as we ll as its maintenance in mutual trade.  
3.14.  A Committee on Market Access is established as per Article 3.14. 3.1.2  Liberalization of trade and tariff lines 
3.15.  As noted earlier, the TEP provides for the ca lendar of mutual tariff dismantling, as follows: 
a. five categories - A, B3, B, B7 and C - provide for tariff elimination, either immediate or 
up to a 10 year transition period; 
b. category F provides product-specific tariff treatment (in accordance with Sections 2 
(Mexico) and 3 (Peru) of the Annex to Articl e 3.4-A) that may involve tariff elimination 
within a transition period up to 11 years, TR Qs and/or the granting of a tariff preference 
(Annex 3). Products benefitting from these preferences are the same for both parties. 
Reductions were originally foreseen either in specific years, starting in 2011 or in equal 
instalments. Given that the Agreement only entered into force in 2012, reduction commitments which were to start in 2011 were skipped, with the 2012 rate being that 
originally foreseen for 2012; in the other cases, all instalments were maintained. 
Identical TRQs are provided for evaporated milk and "dulce de leche"; beans; organic bananas; avocado; oranges; lemons and grapefruits; paprika; corn; cocoa beans; cocoa paste, cocoa butter, fat and oil, cocoa powder; dairy preparations;
11 preserved pepper; 
and shoes. Other preferential treatment that falls short of full tariff elimination include a 
seasonal preference or a margin of preference - which is provided for onions; garlic; asparagus; potatoes; olives; mangoes; mandarins; grapes; papaya; and ethyl alcohol.  
c. finally, two categories ("EXCL " and "PROH") involve products excluded from liberalization 
and for which imports are prohibited. 
3.16.  Liberalization under by the Agreement is depicted in Tables 3.1.A and 3.1.B below. It should 
be noted that unilateral liberalization has taken place in both parties since the beginning of the 
negotiations in 2006; thus, the base rate upon which reductions are foreseen (2006 MFN) may in some instances be very different from the 2012 MFN rate, and some of the commitments may have been overtaken by the applied rate.
12 In such cases, it is for the importer to choose which 
trade instrument fits best its interests.  
3.17.  Also of relevance with respect to Table 3.1.A is the fact that Peru maintains the specific duty 
resulting from the application of the price-band system for certain basic foodstuffs, totalling 47 
tariff lines, including certain dairy products, corn, rice and sugar (a complete list is found in 
Annex 2).13 Out of these 47 lines: 
a. 11 are subject to the TEP, but only two of them (corn starch and dextrins and other 
modified starches) were not duty-free on an MFN basis in 2012. However, they remain 
subject to the specific duties resulting from the application of the price band, except for 
                                               
11 For dairy preparations of HS 1901, the TEP of both Peru and Mexico combined both TRQs increased 
yearly during 12 years (2'662 tons in 2012, increased yearly by 10% up to 2022) with reductions of the out-of-quota tariff rate to achieve full liberalization by 2023. For Peru, this has become redundant given Peru's 
unilateral liberalized of the item, wh ich was already duty-free in 2012.  
12 For Mexico, this occurs for vegetable oils, medica ments, rubber, wood, paper,  graphic arts, acrylic, 
steel and toys. Also, e.g. for corn, for which a TRQ had been negotiated when Mexico had a MFN rate of 194%; 
in 2008, the MFN rate became MFN duty-free. 
13 Under that system, tariffs may be adjusted to price on an international reference market in relation to 
the "band", composed of "floor" and "ceiling" prices determined on the basis of previous prices. When the price 
on the international referenc e market is below the floor price, a tariff surcharge is imposed; when it rises 
above the ceiling price, a tariff reduction is applied; and lastly if it is between the ceiling and floor prices, the corresponding tariff rate applies. Description extracted from Peru's 2007 TPR. WT/REG308/1 
 
- 13 - 
 
  the TRQs applying to evaporated milk and "d ulce de leche", and corn - i.e. in-quota 
imports which are not subject to the specific duties resulting from the application of the price-band system;  
b. as regards the 36 lines excluded from the Agreement, only one (potato starch) was not 
MFN duty-free in 2012; 
c. in the tables and charts below, the 44 tariff lines with MFN duty-free in 2012 were 
treated as fully liberalized.  
3.18.  In 2012 55% of Peru's tariff (4,054 lines, excluding the MFN duty-free remaining subject to 
the application of the price band system) were fully liberalized on an MFN basis; this corresponds to around three-fifths of its imports from Mexico (on the basis of 2009-2011 import average). As of the Agreement's entry into force in April 2012, these figures have increased to 84.2%, covering 
more than four-fifths of imports. Full liberalizati on of additional lines will take place in 2013, 2016 
(the second biggest liberalization under the TEP), 2018, and 2021.
14 At the end of the transition 
period, 97.6% of Peruvian tariff lines will be duty -free for Mexican imports,  covering virtually all 
bilateral imports. Of the 47 tariff lines subject to Peru's price band system, the ad valorem duties 
are eliminated for all but three lines; however, th ey will all remain subjec t to the specific duty 
component under the price band system.   
Table 3.1 Tariff elimination commitments under the Agreement and corresponding 
average trade A. Peru  
Duty phase-out 
period Number of 
lines % of total lines in 
Peru's tariff 
schedule Value of Peru's imports 
from Mexico (2009-2011) 
in million $ % of Peru's total 
imports from Mexico 
2009-2011 
MFN duty free 
(2012) 4,054 55.0 638.4 59.1 
2012 2,149 29.2 247.3 22.9 
2013 4 0.1 0.0 0.0 
2016 506 6.9 121.3 11.2 
2018 11 0.1 45.9 4.3 
2021 469 6.4 18.9 1.8 
Remain dutiablea 177 2.4 8.0 0.7 
Total 7,370 100.0 1,079.7 100.0 
 
a This number includes the lines (i.e. 47) subject to a specific duty under Peru's price band system.  Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines under Pe ru's price band system, only the ad valorem  part is included in 
the calculation of averages. 
 Based on HS 2007 nomenclature.   Source: WTO estimates based on  data provided by Peru. 
 
3.19.  In 2012, 58.3% of Mexico's customs tari ff was duty-free on an MFN basis and 75.8% of 
imports from Peru benefitted from this regime. At the entry into force of the Agreement, 86.6% of 
tariff lines and 89.4% of imports were liberalized for Peru. Liberalization continues until 2023, with 
the second largest number of lines being liberalized at mid-term in 2016. By the end of the transition period, 97.7% of the tariff lines will be  duty-free, encompassing 94.8% of imports from 
Peru. 
                                               
14 As explained earlier, the final liberalization foreseen for 2023 had become redundant given Peru's 
unilateral liberalization. WT/REG308/1 
 
- 14 - 
 
  Table 3.1 Tariff elimination commitments under the Agreement and corresponding 
average trade  B. Mexico 
Duty phase-out 
period Number of 
lines % of total lines in 
Mexico's tariff 
schedule Value of Mexico's 
imports from Peru 
(2009-2011) in 
million US$ % of Mexico's 
total imports from  
Peru 
2009-2011 
MFN duty free (2012) 7,062 58.3 313.1 75.8 
2012 3,423 28.3 55.8 13.5 
2013 5 0.0 0.0 0.0 
2014 1 0.0 0.0 0.0 
2016 592 4.9 14.3 3.5 
2018 15 0.1 0.0 0.0 
2021 733 6.1 8.1 2.0 
2023 2 0.0 0.0 0.0 
Remain dutiable 274 2.3 21.5 5.2 
Total 12,107 100.0 412.8 100.0 
 
Note: There are 22 prohibited lines that are excluded from the average calculation but are included in the 
counting.  Based on the HS 2007 nomenclature. 
 Source: WTO estimates based on  data provided by Mexico. 
 
3.1.3  Liberalization schedule 
3.1.3.1  Peru 3.20.  Table 3.2 illustrates Peru's liberalization vis-à-vis  Mexican imports by HS Section. Products 
remaining dutiable are mainly agricultural,
15 and concern 16% of agricultural lines; as regards 
industrial products, only worn clothing of heading 6309 remain dutiable.16 While for industrial 
products about three-quarters of liberalization took place at entry into force, for agricultural products it is in the year of 2021 that largest percentage of lines will be liberalized, though 
liberalization at entry into force follows closely (respectively 44% and 41% of agricultural lines 
liberalized). If all products subject to price-band system are counted as subject to restrictions, a 16.4% of agricultural lines would remain subject to restrictions by the end of the transition period. 
Table 3.2 Peru: Tariff elimination un der the Agreement, by HS section 
HS 
section MFN 
average
% Total 
No. of 
lines MFN duty-
free (2012) Number of duty-free lines 
No. of lines 
remaining 
dutiable Avg. Final Tariff 
(Dutiable) 
% 2012 
2013 
2016 
2018 
2021 
I 2.3 308 185 44 3 5   20 51a 7.9 
II 4.4 384 121 97   19   81 66a 5.8 
III 2.6 64 36 9   1   14 4a 6.0 
IV 3.8 301 113 28   37   72 51 6.1 
V 1.8 214 151 62   1         
VI 2.0 1,465 970 381 1 97   12 4a 6.0 
VII 2.2 312 196 29   58   29     
VIII 5.3 79 9 29   20   21     
IX 4.4 107 28 51   23   5     
X 3.7 246 93 22   36   95     
XI 9.2 966 63 853   49     1 11.0 
XII 8.8 56   26   11   19     
XIII 2.3 174 106 44   17   7     
XIV 3.5 57 24 23   10         
XV 1.0 700 581 29   36 7 47     
                                               
15 I n  t h i s  S e c t i o n ,  a g r i c u l t u r a l  p r o d u c t s  a r e  t h o s e  o f  H S  S e c t i o n s  I - I V ,  a n d  i n d u s t r i a l  t h o s e  o f  
HS Sections V-XXI. 
16 Products remaining dutiable of HS VI refer to  albumin and glues of Chapter 35, classified as 
agricultural products as  per the WTO definition. WT/REG308/1 
 
- 15 - 
 
  HS 
section MFN 
average
% Total 
No. of 
lines MFN duty-
free (2012) Number of duty-free lines 
No. of lines 
remaining 
dutiable Avg. Final Tariff 
(Dutiable) 
% 2012 
2013 
2016 
2018 
2021 
XVI 1.1 1,195 991 147   50   7     
XVII 1.2 226 181 17   1 4 23     
XVIII 2.4 290 175 110   5         
XIX 6.0 69   69             
XX 4.8 150 31 72   30   17     
XXI 6.0 7   7             
Total 3.2 7,370  4,054 2,149  4 506 11 469 177 6.4 
 
Note: Based on the HS 2007 nomenclature.  Source: WTO estimates based on  data provided by Peru. 
 
3.21.  Chart 3.1 presents a comparison of the tariffs on remaining dutiable products by HS Chapter. The Agreement reduces the average M FN tariff only with respect to vegetables and 
fruits of Chapters 7 and 8, by around 25% for the former and 10% for the latter. 
Chart 3.1 Peru: Average of duti able rates, by HS Chapter 
MFN PreferentialHS 01-97
024681012
02
*04
070809
†10
*11
121516
*17
18
*19
20
†21
22
*23
24
†35
63Average rate of duty (%)
 
 
*  Includes lines under Peru's price band system, with an ad-valorem  fix component of 0%.  
†  Includes lines under Peru's price band system, with an ad-valorem  fix component of 6%. 
 Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines under Pe ru's price band system, only the ad valorem  part is included in 
the calculation of averages. 
 Source: WTO estimates based on  data provided by Peru.  
 
3.1.3.2  Mexico 
3.22.  The vast majority of products remaining duti able at the completion of the transition period 
(see Table 3.3) are agricultural products - 2 40 out of 274. With the exception of vehicles 
(Section XVII), the highest peaks are found for ag ricultural products. Products excluded from 
liberalization include e.g. poultry meat, pig fat,  dairy products, sugar, potatoes, coffee and used 
automotive products (which face a 50% MFN rate).  WT/REG308/1 
 
- 16 - 
 
  Table 3.3 Mexico: Tariff elimination under the Agreement, by HS section HS 
section MFN 
average 
% Total No. 
of lines MFN 
duty-
free 
(2012) Number of duty-free lines 
No. of lines 
remaining 
dutiable Avg. Final 
Tariff 
(Dutiable)  
% 2012 
2013 
2014 
2016 
2018 
2021 
2023 
I 32.9 333 37 79 5   14 8 108   82 61.2 
II 14.6 468 100 122     26   140   80 35.1 
III 16.4 69 14 17     4   32   2 132 
IV 23.3 341 8 63     60   132 2 76 47.7 
V 0.4 211 202 9     0           
VI 1.6 2,859 2,251 495     86   12   15 6.7 
VII 4.3 566 343 157     47   12   7 15 
VIII 4.8 124 92 9         22   1   
IX 7.3 186 63 69     21   33       
X 2.8 318 182 30     55   49   2   
XI 12.4 1,255 159 1.029     66       1 20 
XII 17.3 104 15 38     8   43       
XIII 5.9 311 159 122     21   9       
XIV 4.2 65 43 11     11           
XV 2.7 1,272 953 169     79 6 65       
XVI 3.1 2,480 1,849 582     39   10       
XVII 7.8 402 194 181     4 1 14   8 50 
XVIII 2.8 453 319 128     1   5       
XIX 11.2 33 2 31                 
XX 9.9 243 63 82   1 50   47       
XXI 0 14 14                   
Total 6.1 12,107 7,062 3,423  5 1 592 15 733 2 274 44 
 
Note: There are 22 prohibited lines falling under sections I, II, VI, VIII and X. These lines are excluded 
from the average calculation but are included in th e counting. For tariff lines subject to TRQs, only 
the out-of-quota duty is included in the tariff-related calculations; for the calculation of averages, specific rates are excluded and the ad valorem  parts of alternate rates are included. 
Based on the HS 2007 nomenclature. 
 Source: WTO estimates based on  data provided by Mexico. 
 
3.23.  Chart 3.2 presents a comparison of the tariffs on products remaining dutiable by 
HS Chapter. The highest tariffs are applied in Chapters 15 (in particular pig and poultry fat of 
HS 1501.00.01, with a rate of 254%), followed by coffee preparations and meat of Chapters 21 and 2, respectively. The Agreement's preferences falling short of tariff elimination, though not 
significantly altering MFN tariff peaks, result in tariff peaks in preferential trade being reduced by 
around 10% as regards vegetables, fruits, food an d milk preparations, beverages (HS Chapters 7, 
8, 16, 19, 22), and almost negligibly as regards meat (HS Chapter 2). 
Chart 3.2 Mexico: Average of dutiable rates, by HS Chapter 
MFN Preferential0102030405060708090
01
020407080910111215161718
19
2021222435406387Average rate of duty (%)HS 01-24 HS 25-97
 
 WT/REG308/1 
 
- 17 - 
 
  Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for the calculation of averag es, specific rates are excluded and the ad valorem  parts of 
alternate rates are included. 
 There are 3 prohibited lines falling under chapter 12 which are excluded from the average 
calculation.  
 Source: WTO estimates based on data provided by Mexico.   
3.1.4  Tariff-rate quotas 
3.24.  There are a few TRQs provided for under the Agreement for some of the products in 
category "F", as explained in 3.15.   above. These,  along with products subject to tariff reductions 
and seasonal duties, are detailed in Annex 3. 
3.2  Rules of origin 3.25.  Rules of origin are set out in Chapter IV. The basic requirements for a good to be considered 
originating, as in Article 4.2, are: 
a. The good is wholly obtained or produced entirely in the Parties; or 
b. the good is produced entirely in the Parties from originating materials only; or 
c. the good is produced entirely in the Parties by using non-originating materials which 
comply with the specific rules of origin contained in Annex to Article 4.2, as follows: 
i. it goes through a change in tariff classification (CTC), or 
ii. it meets a minimum regional value content (RVC) benchmark, 
iii. in fewer cases than ii above, it goes through a CTC and meets requirements 
concerning a minimum RVC, or 
iv. for tariff headings 2710 and 7308 and for apparel of Chapters 61, 62 and 63, specific 
processing requirements are fulfilled, and  
d. in any of the before mentioned cases, the good meets all other applicable criteria 
contained in Chapter IV. 
3.26.  The main criterion for a good produced by using non-originating materials to acquire 
originating status is a CTC. The CTC applies generally at the HS heading level, but requirements at the subheading and chapter levels are also frequent (the latter in particular for agricultural and mineral products). Article 4.3 provides a list of non-qualifying operations that do not confer origin. 
3.27.  In the case of sets or assortments (Article 4.12), each good part of the set has to fulfil the 
origin requirements. According with the tolerance rule, a set or assortment will be considered originating if the value of all non-originating elements (adjusted on a c.i.f. basis) does not exceed 
10% of its transaction value (adjusted on a f.o.b. basis).  
3.28.  No outward processing is authorized under  this Agreement (Article 4.16). Transit through 
non-Parties is authorized only if the good remains under the surveillance of the customs 
authorities, with or without transhipment, provided that the good is not traded nor used in the 
transit country and no processing takes place outside the territory of the Parties other than loading, unloading or any other operation necessary to preserve it in good condition or to transport it (Article 4.17). 
3.29.  Article 4.4 provides that the RVC is the di fference between the transaction value of the good 
(f.o.b. basis) and that of the non-originating mate rials divided by the transaction value of the good WT/REG308/1 
 
- 18 - 
 
  (f.o.b. basis).17 The RVC threshold of is 50%, with very few exceptions, so that originating status 
is granted (i) for automotive products under HS  8701-8707, if they comply with an RVC of 35%; 
(ii) for petroleum oils in HS2710, if they comply with an RVC of 40%; and (iii) for padlocks and locks of HS8301.10 and 8301.50, and other electric apparatus of HS8535.90, if they comply with 
an RVC of 60%. In addition, for ce rtain automotive products under (i),
18 the producer may choose 
to average costs when calculating the RVC; averag ing over the fiscal year may be done for three 
different categories,19 either on the basis of all motor vehicles of that category or only those in a 
category that are exported to the other Party. There is a provision for intermediate materials in 
order to benefit the vertical integrated producers (Article 4.6). 
3.30.  The value of non-originating materials incorporated in another good that has acquired 
originating status is not added into the RVC calculation (Article 4.5:2); this is also the case for 
those materials which have been designated as "intermediate material" by the producer. 
3.31.  Bilateral cumulation applies between the two Parties (Article 4.7). Article 4.8 deal with 
diagonal cumulation ("extended cumulation of origin"); it provides for diagonal cumulation in cases 
where both Parties have a "preferential trade agr eement" with another country and when the input 
is originating in the context of the Mexico-Peru RTA.20 In addition, equivalent clauses shall also 
apply in the context of these pref erential agreements with third-parties; other conditions may also 
be agreed between the Parties in order to implem ent diagonal cumulation. The following countries 
are able to benefit from extended cumulation.  
3.32.  A flexible provision also applies to certain elastomeric yarns (HS 5402.44) from the United 
States and Brazil used in the production of certain textiles and apparel, as follows: 
a. for goods classified under headings 5111-5113, 5204-5212, 5407-5408, 5508-5516, 
5601-5609, 5801-5811, 5901-5911, 6001-6006, 6301-6310, the elastomeric yarns are imported from, and produced in, the United States;  
b. for goods classified under headings 6101-6117 and 6201-6217, the elastomeric yarns 
are imported from, and produced in, either the United States or Brazil; and 
c. in both cases, the rules of origin of the Agreement applying to elastomeric yarns are 
fulfilled. 
3.33.  A de minimis  rule (Article 4.9) applies so that the good is considered originating if the value 
of all non-originating materials that do not comply with the required CTC is less than 10% of the transaction value. Any additional RVC requirement will apply without any change. De minimis  does 
not apply to the following: 
a. textiles goods in HS Chapters 50 to 63; however, if the good is non-originating because 
the fibres and yarns used in the production  of the component which defines the tariff 
classification of the good do not comply with the CTC requirements, it will nonetheless 
be considered originating if their total weight of such fibres and yarns does not represent more than 10% of the material's total weight; and 
b. a non-originating material used in the production of goods of Chapters 1 to 27, unless 
the material is of a subheading different from the one for which origin is being determined. However, de minimis  may still be applied for non-originating material from 
the same subheading whenever the materials are distinct from the final good; 
                                               
17 Valuation of goods is done on the basis of the WTO Agreement on Implementation of Article VII of the 
GATT 1994. Adjustments may however differ when non-originating materials are bought already in the territory of the Party. 
18 Headings 8702 and 8706 and subheadings 8701.20, 8703.23-8703.90, 8704.21, 8704.22, 8704.23, 
8704.32, 8704.90, 8705.40, 8707.10. 
19 The categories are: the same model line of motor ve hicles in the same class of vehicles produced in 
the same plant; the same class of motor vehicles produced  in the same plant; or the same model line of motor 
vehicles produced in a Party. 
20 Diagonal cumulation could take place with produc ts from the United States, Canada, Chile, Japan, 
EFTA and the European Union; these are howeve r not specifically name d in the Agreement. WT/REG308/1 
 
- 19 - 
 
  3.34.  Chapter IV provides for the creation of two bodies; these are described in Section 5.5 of this 
document. 
Box 3.1 Rules of Origin at a Glance 
Basic Characteristics 
 
 Product-specific general criteria: 
o  Wholly obtained goods 
o  CTC, generally a change of heading 
o  RVC: 50%. 
 
 Bilateral cumulation; diagonal cumulation under certain conditions 
 
 Tolerance rules. 
 
 No outward-processing authorized. 
 
3.3  Export duties and charges,  and quantitative restrictions 
3.35.  Article 3.6 includes a general prohibition on restrictions on exports from the other Party, 
including quantitative restrictions (QRs); the exceptions are as follows: 
a. QRs explicitly allowed elsewhere in the Agreement; 
b. QRs authorized under Article XI of the GATT 1994 and its interpretative notes, which are 
made an integral part of the Agreement; 
c. price undertakings agreed in the context of dumping and subsidies proceedings; 
d. measures listed in Annex to Articles 3.3 and 3.6. In practice, that only concerns Mexico's 
exports of certain mineral fuels21 - for which an export licence scheme is in place - and 
of rough diamonds, in the context of the Kimberley Process Certification Scheme; and 
e. restrictions authorized by the WTO Dispute Settlement Body. 
3.36.  Article 3.9 imposes a general prohibition on duties and charges connected to exports, unless 
these are also applied on the domestic consumptio n of the same goods, or otherwise included in 
the exceptions list of Annex to Article 3.9. Thus, Mexico is authorized to apply duties and charges 
on the export of certain basic foodstuffs, their ingredients or derivatives, that are part of a 
domestic food aid programme or of price stabilization mechanism, or applied on a temporary basis 
in order to relieve critical shortage of foodstuffs.22 
3.4  Regulatory provisions on trade in goods 
3.4.1  Standards 
3.4.1.1  Sanitary and phytosanitary measures 3.37.  The rights and obligations of the WTO Agreement on Sanitary and Phytosanitary (SPS) 
Measures are incorporated into the Agreement, unless otherwise specified in Chapter VII that deals 
with these issues (Article 7.3).  
3.38.  The Parties may adopt or maintain any measure offering a level of protection that is higher 
than that deriving from international regulations, principles or recommendations, whenever 
scientific justification exists, provided they do not constitute a disguised restriction on international 
                                               
21 Comprising 13 tariff lines of HS 2709-2711. 
22 I.e. vegetal oil, rice, canned tuna, sugar, coffee, boneless beef meat, beer, chocolate, beans, corn 
flour, eggs, milk, animal and vegetal butter, molasses, potatoes, pasta, ch eese, salt, tomatoes, carrots, canned 
sardines, canned peppers, chicken broth, wheat flour, low-priced cookies, gelatine, beef liver, oat flakes, 
cooked ham, bread, crackers, French rolls, soup paste, soft drinks, beef remnants and bones, corn tortilla and dough. WT/REG308/1 
 
- 20 - 
 
  trade nor have as objective or effect the creati on of unnecessary obstacles to trade between the 
parties. 
3.39.  Article 7.5 promotes the equivalence of sanitary standards, and defines mechanisms for 
evaluating and accepting SPS measures as equivalent. As of end-July 2013, no progress has been 
achieved regarding the equivalence of sanitary standards. 
3.40.  Transparency provisions are contained in Article 7.9. The Parties must inform each other 
about the adoption or application of SPS measur es in accordance with the WTO SPS Agreement. 
Besides, immediate notification is to occur in cases of animal health, establishment or spread of 
vegetable pests, and emergency situations relating to control of food traded between the Parties. 
Direct mutual notification is also provided for various SPS-related issues, such as scientific discoveries of epidemiological importance and significant changes with respect to other pests and 
diseases. The Agreement foresees the possibility of  establishing an information system, details of 
which could be agreed in the "Committee on SPS Measures", established under Article 7.10. Finally, transparency provisions foresee the supply of information on progress on investigations 
related to a measure taken that affects the other Party. 
3.41.  The Parties may have recourse to the Agreement's dispute settlement provisions with 
respect to SPS measures, once consultations held  in the context of the SPS Committee have not 
sufficed to resolve the problem under consideration.  
3.4.1.2  Technical barriers to trade 3.42.  Chapter VIII applies to technical barrier s to trade (TBT) as defined by the WTO's TBT 
Agreement, which is incorporated into the Agreem ent unless otherwise specified (Article 8.3). The 
disciplines of this Chapter apply to the elaboration, adoption and application of all technical 
regulations, standards and conformity assessment procedures that may affect, directly or indirectly, trade in goods between the Partie s, but not to SPS measures nor government 
procurement. They apply both at the central and local levels of government. (Article 8.5).  
3.43.  Each party is free to establish a level of protection it considers appropriate to achieve its 
legitimate objectives; thus, it may elaborate, adopt or maintain measures necessary to ensure 
compliance with its domestic technical regulations, standards and conformity assessment 
procedures, in accordance with the WTO TBT Agreement (Article 8.4). None of these measure shall have the goal or effect of creating unnecessary obstacles to trade. International standards shall generally be used as a basis for the Party's domestic standards, unless they do not constitute an 
efficient and adequate means to achieve legitimate objectives.  
3.44.  The equivalence of the Parties' technical regulations are recognized through a common 
declaration formalized by a decision of the Agreement's Commission (Article 8.6). A Party is to 
consider favourably the possibility of accepting as equivalent the other Party's technical regulations 
whenever it is convinced that they comply adequately with the legitimate objectives of its own technical regulations. The refusal to grant equivalence requires due justification. 
3.45.  Equivalence of conformity assessment procedures is also encouraged, as well as the 
negotiation of mutual recognition agreements (Article 8.7). A refusal to initiate or to complete negotiations for such agreements, or to reject the results of a conformity assessment carried out in the territory of the other Party, shall be duly justified. The application of national treatment for 
accreditation, authorization or recognition of conf ormity assessment entities in the territory of the 
other Party is reaffirmed; any deviation from that principle shall be duly justified. 
3.46.  Transparency provisions are contained in Article 8.8; in particular, they provide for the 
electronic transmission of notifications regarding projects of technical regulations and conformity 
assessment procedures, at the time these are notified to countries with which the Parties have an RTA; notification 60 days prior to publication (as in the WTO) is required for any proposals to 
adopt new technical regulations and conformity assessment procedures; in cases of urgency, this 
timeframe may be reduced but an electronic notification shall be made at the time of announcement for partners in RTAs. Notification shall also include technical regulations and conformity assessment procedures of a technical content that conform with international WT/REG308/1 
 
- 21 - 
 
  regulations, principles and recommendations. The disciplines on transparency are to be 
implemented within a two-year timeframe, i.e. by January 2014.  
3.47.  Technical assistance measures are contained in Article 8.9. Article 8.10 establishes 
a "Committee on Technical Barriers to Trade", consisting of representatives from each Party's 
competent authorities. Technical consultations may be conducted either in that Committee, or in 
the context of a dispute; Article 8.11 details its procedures and timeframes. 
3.48.  Finally, information is to be exchanged either in a printed or electronic format within a 
reasonable period, with a best endeavour timeframe of 60 days (Article 8.11). 
3.4.2  Safeguard mechanisms 3.49.  Chapter 6 authorizes the use of global and bilateral safeguard measures (respectively 
Sections A and B). Simultaneous application (on the same product under the same period) of a 
global and a bilateral safeguard is prohibited (Article 6.2:2).  
3.50.  As of end-July 2013, neither Mexico nor Peru have adopted a safeguard measure under the 
scope of this Agreement. 
3.4.2.1  Global safeguards 
3.51.  Global safeguards (Articles 6.2 and 6.3) are to be applied in accordance with the rights and 
obligations of the WTO Agreement on Safeguards  and Article XIX of the GATT 1994. They may 
only be imposed on originating products of the other Party if such imports: 
a. are "substantial" - i.e. the other Party is one of the five main suppliers of the product (on 
the basis of the last three preceding years) to the importing Party; and  
b. contribute "importantly" to the injury or threat thereof increase of imports which caused 
the serious. This will not be the case if thei r participation in the absolute growth rate of 
the import volume of the product concerned during the period under review is substantially lower than the participation of other suppliers. 
However, imports from the other Party may subsequently be subject to a global safeguard 
from which they were initially excluded if the investigating authority determines that a significant import increase from that Party reduces the efficiency of the safeguard measure 
in such a way as to limit the real or potential growth of the domestic industry. 
3.4.2.2  Bilateral safeguards 3.52.  Bilateral safeguards (Articles 6.4-6.11) may take the form of a temporary suspension of 
further tariff reductions or of a tariff increase, with the maximum rate being the lowest between 
the current MFN rate and that prevailing the day before the Agreement's entry into force. These 
are authorized as exceptional measures during the transition period applying to the product concerned; any extension beyond that date requires acceptance from the other party. 
3.53.  Subject  to an investigation, in cases where imports of an originating product for which 
tariffs had been reduced or eliminated according to the TEP have increased to such an extent - both in absolute terms and relative to domestic production - and under such conditions that they 
cause, or threaten to cause, serious injury to the domestic industry of similar or directly 
competitive goods, the imposition of bilateral safeguards is authorized provided this is necessary to prevent or counter the injury, and to facilitate adjustment of the domestic industry. 
3.54.  The initial application of a safeguard measures may last a maximum of two years, with a 
possible extension of one year; the maximum du ration cannot go beyond three years. Re-
imposition of safeguards is only authorized if an interval equal to the duration of the previous measures has elapsed. 
3.55.  The imposition of a safeguard measure is to be accompanied by a TRQ, whereby the 
in-quota rate is the preferential tariff in force at that time and the quantity is equivalent to the WT/REG308/1 
 
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  average imports of the three-years or 36-month pe riod preceding the determination of injury or 
threat thereof, unless a clear justification is provided on the need for a different quantity 
(Article 6.4:4). 
3.56.   Compensation shall be provided upon the definitive application or extension of a safeguard 
measure. The compensation, of equivalent trade effect, is to be mutually agreed with the 
exporting Party; if no such agreement is reached within 30 days, retaliation is authorized (Article 6.10). 
3.57.  Upon termination of the safeguard measure, the applied tariff will be that resulting from the 
normal application of the TEP or the preferential ta riff in force at the time of the imposition of the 
safeguard, but with a re-scheduling of the tariff dismantling programme through equal annual instalments so that the tariff elimination will take place on the same date. 
3.58.  Provisional measures of a maximum duration of 180 days are allowed in critical 
circumstances, upon a preliminary determination of injury or threat thereof (Article 6.9). Following final determination, amounts paid in excess will be reimbursed with interest without delay upon 
the request of the affected Party (Article 6.11).  
3.59.  Detailed procedures, including specific timeframes, for the launching and conduct of an 
investigation as well as the imposition of safeguard measures are detailed in Articles 6.5-6.7. The 
investigation, carried out by the Party's competent authorities, may be initiated on the Party's own 
initiative or upon the request of the "domestic industry" accounting for at least 25% of domestic production of similar or directly competing goods. The investigating authority can only determine the existence of serious injury or threat thereof if a direct "causality link" between the rise in 
imports and the serious injury or threat thereof to a Party's domestic production can be 
demonstrated. The investigation's final determination shall take place and be made public within a maximum period of one year, and within 18 months in exceptional circumstances. The timeframes 
are as follows: notification of any resolution within five days from publication of the determination, 
30 days for reply to questionnaires and for comment s on the imposition of a provisional measure. 
3.4.3  Anti-dumping and countervailing measures 
3.60.  Chapter IX deals with unfair trade practices.  The procedures relating to investigation for the 
application of anti-dumping (AD) and countervailing measures (CVM) are those of the WTO Agreements on Subsidies and Countervailing Measures  and on Implementation of Article VI of the 
GATT 1994; adjustments of both a procedural and substantial nature are however made. As 
regards transparency, these involve: 
a. clarification of the publication of information and of the information to be made available 
to exporters and to investigating authorities of the other Party (Article 9.4); 
b. upon request, the investigating authority is to hold a technical information meeting on 
the methodology used for the resolution determination (Article 9.5); 
c. possibility for interested parties to get accreditation and to take part in public hearings 
(Articles 9.6 and 9.7). 
3.61.  As regards differences on the substance, they are as follows: 
a. an AD or CVM amount that is lesser than the margin of dumping or amount of the 
subsidy, respectively, is to be applied (the WTO Agreement refers to the application of 
such a lesser amounts as "desirable"), if this is adequate to remove the injury to the 
domestic industry (Articles 9.8 and 9.9). In order to do so, the authorities shall compare the import price of the product under investigation with a non-harmful price, calculated 
through one out of four methodologies, and requiring a justification for the use of the 
methodology chosen (Article 9.9); WT/REG308/1 
 
- 23 - 
 
  b. higher  de minimis  margins of dumping23 as compared to those under the WTO 
Agreement, namely below 5% of the export pr ice of the product subject to investigation 
(Article 9.10, the relevant margin is of 2% in the WTO); 
c. higher thresholds for considering that the volume of subsidized imports from the other 
party is negligible - if the import volume of products subject to dumping is below 5% 
(3% in the WTO) of the imported volume or below 2% of the domestic market, investigations are terminated; 
d. while the timing for the sunset clause (5 years) and the fact that extensions are possible 
constitute obligations as in the WTO, the Agreement clarifies that these extended anti-dumping measures or CVM can be applied on the same product only after a 12 months interval (Articles 9.11 and 9.12; the WTO refers to after "a reasonable period 
of time"); 
e. the investigating authority informing  the exporters or interested Government (i) of its 
right to offer a price undertaking prior to issuing a preliminary determination of injury 
caused by dumping or subsidies; and (ii) of the measures that are to be taken in cases 
where violations of undertakings would have been detected (Article 9.13).  
3.62.  Disputes regarding unfair trade practices are to be resolved through the Agreement's 
dispute settlement provisions; the Parties may however decide instead to use the WTO dispute 
settlements procedures (Article 9.18). 
3.63.  Finally, the Parties agree to increase co-operation in matters related to unfair trade 
practices and their respective domestic legislation, and establish a Working Group to carry out 
activities with that aim (Articles 9.15 and 9.16). 
3.4.4  Subsidies and State-aid 3.64.  Article 9.3 prohibits the use of subsidies on  the export of products towards the other Party 
as specified in Article 3.1 of the WTO Agreement on Subsidies and Countervailing Measures. 
3.4.5  Customs-related procedures 3.65.  Customs procedures are dealt with in the sa me chapter of rules of origin - i.e. Chapter 4. 
The Certificate of Origin, which provides the basis fo r the granting of preferential tariff treatment, 
is to be filled in and signed by the producer or exporter and validated by the competent authority of the exporting Party, which can delegate this auth ority to public or private entities (Article 4.18). 
The focal point of each competent authority will be duly notified by each party; names, stamps and 
signatures of the delegated entities and accredited officials will be notified to the LAIA Secretary 
General. In cases where the exporter is not the producer, the former may request the issuing of a Certificate of origin on the basis of a declaration of origin supplied by the producer, either to the 
exporter or directly to the competent authority. Future use of digital certificates of origin are 
envisaged.  
3.66.  The Certificate of Origin has a duration of 12 months from its emission; details of 
information and documents to be attached to the certificate are also included in Article 4.18. 
Obligations with respect to imports and exports are contained in Articles 4.19 and 4.20, respectively. A Certificate of Origin is not requ ired when the import value is under US$1,000 or 
when the importing Party exempts a good from the certificate of origin requirement (Article 4.21), 
unless such imports are aimed at circumventing obligations under the rules of origin chapter. 
3.67.  Rules relating to verifying the origin of a good are contained in Articles 4.26-4.32. The 
competent authorities of the importing Party may submit a written questionnaire to, or visit, 
exporters or producers in the territory of the expo rting Party. Questionnaires are to be answered 
within 30 days from the date of receipt, extendable by 30 days upon request; in case of delay, the importing Party may deny preferential tariff treatment further to a decision to that effect. Any visit 
                                               
23 As in the WTO, a determination of de minimis  levels of dumping shall terminate the investigation and 
no measure shall be applied. WT/REG308/1 
 
- 24 - 
 
  from the importing Party's authorities shall be preceded by a written notice of at least 10 days, to 
be sent to the exporter or producer to be visited and, to the Party's competent authorities where the visit will take place. The exporter or producer  may request, within 15 days from receipt of the 
notification, a postponement of the visit for a period up to 30 days. If the exporter or producer 
does not confirm the visit within 20 days from receipt of the notification, the importing Party may 
deny preferential tariff treatment on the good subject to verification. 
3.68.  The result of the verification, includin g its reasoning, shall be communicated by the 
competent authority of the importing Party to the exporter or producer within 365 days from the 
beginning of the verification process; failure to do so will result in granting preferential treatment. 
The competent authority of the exporting Party is to be informed of the verifi cation result within 30 
days from its emission. If originating status is certified, any temporary measure would have to be 
withdrawn within 90 days from the importer's request to do so; in exceptional cases, a 30 days 
extension may be granted. Failure to issue the resu lt within the 365 days. If originating status is 
denied, the importing party may apply sanction s in accordance with the Agreement and its 
domestic legislation. In cases where the exporter or producer has provided more than once false 
or incorrect information on the good's origin, the competent authority of the importing Party may suspend preferential tariff treatm ent of identical goods from the same exporter or producer until 
such time as it can prove that it fulfils the requirements of Chapter 4. 
3.69.  Advanced rulings (Article 4.36) are issued by the importing authorities following a written 
request by the importer, exporter or producer, within 150 days from the receipt of all needed 
information.   
4  PROVISIONS ON TRADE IN SERVICES AND INVESTMENT 
4.1  Scope and definitions 4.1.  Trade in services is governed by Chapter X (Cross-Border Trade in Services) together with 
Chapter XII on Financial Services, Chapter XIII on the Temporary Entry of Business Persons; 
Chapter XIV on Mutual Recognition of Academic Certificates, Titles and/or; Investments are covered by Chapter XI.  
4.2.  Chapter X applies to measures affecting trade in services by service suppliers of a Party, 
adopted or maintained by the other Party at the federal or national level, state or regional level and municipal or local level, and by non-government al bodies in the exercise of powers delegated 
by government authorities. Three out of the fo ur GATS modes of supply - namely cross-border 
trade, consumption abroad and temporary move ment of natural persons - are covered in 
Chapter X (Article 10.1). Mode 3 on right of esta blishment/commercial presence is covered in the 
investment Chapter, though market access and domestic regulation disciplines applying to the 
right of establishment in the context of an investment are those of Chapter X (but not with respect 
to dispute settlement).  
4.3.  As regards Chapter X exceptions: 
a. as in the GATS, the following cross-border trade in services are excluded from the 
Chapter's coverage (Article 10.2): 
i. government procurement;  
ii. traffic rights and services directly related to the exercise of traffic rights, except 
aircraft repair and maintenance services, the selling and marketing of air transport 
services and computer reservation systems services; and 
b. Chapter X does not impose any obligation on the Parties with respect to a national of the 
other Party seeking access to its employment market or already employed on a 
permanent basis in its territory, nor confer any right on that national with respect to that access or employment;  
c. no provision of Chapter X may be subject to dispute settlement between a Party and an 
investor of the other Party in accordance with Section C of Chapter XI; and WT/REG308/1 
 
- 25 - 
 
  d. Chapter X does not apply to services supplied in the exercise of governmental authority 
on a non-commercial basis and not in competition with another service supplier. 
4.4.  Chapter XI on investments consists of three sections - general provisions, protection of the 
investment of the other Party, and an investor-P arty dispute settlement mechanism (Sections A, B 
and C, respectively). It provides a definition of investment (Article 11.1) as assets owned or 
controlled by investors of a Party, acquired in the other Party in conformity with its laws and regulations and provides a list of those assets. It  specifies the scope of the Chapter (Article 11.2) 
as applying to measures:
24 
a. adopted or maintained by a Party relating to (i) investors of the other Party; (ii) their 
investments in the Party; and (iii) all investments in the territory of the Party with respect to performance requirements and environment-related measures (respectively 
Articles 11.7 and 11.17); and 
b. measures adopted by a State-trading enterprise or a person, whenever any of them 
operate through a governmental delegation of authority. 
4.5.  As regards Chapter XI exceptions, Article 11.10 clarifies that the Parties are free to negate 
the establishment of investments in its territory in sectors that are reserved to the State and listed 
in Annex V to the Agreement. In this Factual Presentation, detailed information presented is 
generally limited to the scope of the GATS as it refers to investment - namely only as it relates to 
right of establishment; a brief overview of other investment-related disciplines are however included in paragraph 4.73.   
4.6.  Chapter XII on Financial Services applies to measures adopted by a Party related to (a) 
financial institutions of the other Party; (b) cross-border trade in financial services; and 
(c) investors of the other Party, and their investments, in financial institutions in the Party's territory as well as investments from such ente rprises that provide complementary or auxiliary 
services towards fulfilling their social objective. In  case of incompatibility between this Chapter and 
any other Agreement's clause, the former prevails to the extent of the incompatibility. 
4.7.  Chapter XII excludes (Article 12.2): 
a. special exceptions applying to financial services, as explained in paragraph 4.78.   
below;  
b. activities/services within public schemes related to retirement or social security; 
c.  the use of financial resources owned by the other Party; and 
d. other activities/financial services on behalf of the Party or its public entities benefitting 
from State guarantees. 
4.8.  As regards future developments, the Pa rties agree to consult annually on Chapter X 
improvements, in particular the possibility of removing nationality/permanent residence 
requirements for the granting of licences or certifications to service suppliers of each Party, and improving transparency regarding non-conforming me asures that are either to be modified or for 
which a Party has reserved its rights to future application. 
4.2  Denial of benefits 4.9.  Under Articles 10.13 and 11.14, a Party can deny the benefits provided in the relevant 
Chapter to a cross-border service supplier or to an investor from of the other Party, respectively, if 
it determines that the service in being supplied by, or the investment of such an investor is, an 
enterprise owned or controlled by persons of a third party and: 
                                               
24 Also clearly specified is the fact that the Inve stment Chapter does not ap ply to measures already 
covered under the Financial Services Chapter. WT/REG308/1 
 
- 26 - 
 
  a. -the Party denying the benefits either (i) do not have diplomatic relations with the third 
party or (ii) applies measures prohibiting transactions with that enterprise which would thus be circumvented; or 
b. the enterprise has no substantial business operations in its territory. 
4.10.  Prior notification of the denial of benefits is required in all cases except under (a) above as 
relates to investors from the other Party.  
4.11.  Subject to communication and consultations, the Parties can also deny the benefits provided 
in Chapter XII to financial institutions or cross-border financial services providers of the other 
Party, if the institution in question has no substantial business operations in the other Party or is owned or is under the control of persons of a third party (Article 12.16).  
4.12.  Denial of benefits can be challenged th rough Chapter XV dispute settlement provisions as 
regards cross-border trade in services and, subject to Articles 12.19 and 12.20, as regards 
financial services (see paragraph 5.18.   below). For investments, the applicable provisions are those of Section C of Chapter XI.  
4.13.  The Agreement does not contain an express definition of the scope of the term "substantial 
business operations" or of the issues related to "control".  
4.3  General provisions on trade in services 
4.3.1  Market access 
4.14.  Market access commitments have been undertaken for cross-border trade in services and 
establishment in services sectors. For financial services, obligations are yet to be developed with respect to market access and quantitative restrictions (Article 12.22); as of end-July 2013, no 
timeframe had been set for initiating this work.  
4.15.  As regards cross-border trade in services, a positive list of market access commitments, as 
in the GATS, is in force; the disciplines are contained in Article 10.6 and sectors committed are 
listed in Annex III. Such market access disciplines cover all the four modes of supply, since 
Article 10.2.4 extends to them to the right of es tablishment in the context of an investment; any 
dispute settlement between a Party and an investor of the other Party is however regulated by 
Section C of Chapter XI. 
4.16.  For committed sectors, market access discipl ines and prohibited limitations generally mirror 
those of the GATS, including the fact that under both Agreements (otherwise) prohibited market 
access limitations are authorized if they are specifically mentioned in a Party's list of commitments.  
4.17.  The GATS general prohibition on foreign eq uity limitations as regards investment from the 
other Party is generally maintained, given that national treatment apply to investments and investors of the other Party, excepted as explained in paragraph 4.21.   below.  
4.3.2  National and MFN treatment 
4.18.  The general principle is that both national and MFN treatment are granted across-the-board; 
non-conforming existing measures constitute however exceptions to these disciplines.  
4.19.  National treatment and MFN disciplines apply as follows: 
a. to cross-border services suppliers of the other Party (Articles 10.4 and 10.5), 
irrespective of whether or not market a ccess commitments have been undertaken in a 
service sector; 
b. to investors of the other Party and their inve stments (Articles 11.3 and 11.4). Further, in 
accordance with the "standard of treatment" under Article 11.5, an investor of the other 
Party and the investment of the investor of the other Party has the right to the better of 
national or MFN treatment; and WT/REG308/1 
 
- 27 - 
 
  c. as regards financial services, to the following (Article 12.6): 
i. investors of the other Party with respect to their engagement in similar financial 
institutions as well as their investments in similar financial institutions; 
ii. financial institutions of the other Party, as well as to investments from investors of 
the other Party in financial institutions located in the territory of the Party; and 
iii. providers of cross-border financial services.  
4.20.  Non-conforming measures constituting except ions to these principles are as follows (as per 
Articles 10.8, 11.9 and 12.21): 
a. existing measures, as well as their continuation, renewal or modification, provided their 
level of non-conformity is not increased - i.e. the "ratchet" clause, as follows: 
i. for financial services, the non-conforming measures applied by a Party listed in 
Section A of Annex VI; 
ii. for all other trade in services covered by the Agreement, the non-conforming 
measures applied by national or federal governments listed in Annex I. 
Non-conforming measures at state or regional levels of government only applies to 
Mexico (Peru has an unitary State). Mexico's list of such measures has been incorporated in Annex I in early 2013; pending that incorporation, measures applied 
at the time of the Agreement's entry into force also constituted exemptions. Finally, 
all non-conforming measures applied at the local or municipal level of government are exempted;  
b. future measures applied on any sector, sub-sector or activities included in Section B of 
Annex VI with respect to financial services, an d in Annex II for all other trade in services 
covered by the Agreement. In the latter case, however, nationality requirements cannot be applied retroactively as regards existing investments from investors of the other Party 
(Article 11.9:4); and 
c. finally, those national treatment and/or MFN non-conforming measures listed in either 
Annexes I or II will also apply respectively to financial services to the extent the 
measure/sector/subsector or activity specified therein is covered under the Financial 
Services Chapter. 
4.21.  Other specific derogations from MFN and national treatment are as follows: 
a. national treatment and MFN do not apply to foreign investments/investors in the context 
of (i) government procurement of a Party, or procurement from a State-trading 
enterprise; and (ii) subsidies or grants, granted by a Party or by a State-trading enterprise (Article 11.10); 
b. MFN treatment does not apply in cases of treatment granted through GATS Article V-
type agreements nor to measures included in Annex IV on MFN exceptions (Article 11.10). Only Mexico has an Annex IV, in which the following preferential treatment are 
exempted from MFN obligation: (a) those granted under agreements in force prior to 1 
January 1994; (b) for agreements concluded after that date, those granted as regards aviation, fishing and maritime issues; and (c) existing or future treatment in the context 
of international co-operation aimed at economic development.   
c. national treatment does not apply in cases where a Party has granted exclusive rights to 
a financial institution as regards public schemes related to retirement or social security (Article 12.9). WT/REG308/1 
 
- 28 - 
 
  4.3.3  Commercial presence 
4.22.  The right of establishment/commercial presen ce applies with respect to those cross-border 
trade in services sectors for which market access commitments have been undertaken, as included in Annex III. 
4.23.  Under Article 10.7, a cross-border service provider of a Party will not be required by the 
other Party to set up or maintain a representative o ffice or other form of enterprise or be resident 
in its territory in the context of a cross-border supply of service. Exceptions to this principle, 
contained in 4.20.   above apply, mutatis mutandis . 
4.24.  Article 12.4 provides investors of one Party the right to establish a financial institution in the 
territory of the other Party in accordance with the latter's domestic legislation; terms and conditions compatible with national treatment requirements may be imposed at the time of the 
establishment of the institution. Such right of establishment does not extend to non-conforming 
measures listed in Sections A and B of Annex VI, in accordance with the terms and conditions presented in paragraph 4.20.   above, mutatis mutandis (Article 12.21). 
4.3.4  Movement of natural persons 
4.25.  Chapter XIII lays out the conditions for the temporary entry of four categories of business 
persons in the Parties' territories and associated timeframes for such entry,
25 subject to 
compliance with their immigration requirements. It aims at facilitating the temporary entry of 
business persons on the basis of reciprocity while considering the need to establish transparent criteria and procedures in this area. It also reflects the need to ensure border security, and the protection of the domestic labour force and of permanent employment in their respective 
territories (Article 13.2).  
4.26.  According to the Annex to Article 13.4, each Party commits to grant an authorization of 
temporary entry to: 
a. Business visitors (Part I, Section A) engaged in certain business activities (research and 
development, farming, manufacturing, production , trading, sales, distribution, after sales 
and general services). Such authorization will not require a work certificate or any other 
procedure with similar effects and will be issued as long as the business person (i) 
presents proof of citizenship of a Party; (ii) presents documents proving the activity to be carry out and the purpose of the entry; and (iii) demonstrates the international nature of the proposed business activity and that the person is not seeking to enter the 
local labour market; the last condition will normally be considered fulfilled through an 
oral declaration that both the remuneration and the profits accrued are mainly from a foreign country. The stay is set for 183 days . A stay of at least 183 days without any 
work certificate will also be granted to bu siness visitors engaged in other activities. 
b. Traders seeking to conclude an important deal  relating to trade in goods or services 
between the Parties and investors (Part I, Section B) seeking to establish, develop or 
administer an investment to which the business person or its company has committed, 
or is in the process of committing, a substantial amount of capital
26 and who has 
essential abilities in that respect, provided  the person complies with the applicable 
immigration regulations. The Parties cannot apply quantitative restrictions in that 
respect, but may require a visa prior to such entry.  
                                               
25 Article 13.1 defines "business person" as a citizen of a Party who is engaged in trade in goods, the 
provision of services or investment activities. As such, it goes beyond the GATS Annex on Movement of Natural Persons supplying services, as the latter covers only persons who are service suppliers of a Member, and persons of a Member who are employed by a service supplier of a Member. 
26 In the text of the Agreement there is no definition of the concept of "a substantial amount of capital"; 
this is subject to the legislation of the Parties. According to Colombian domestic legislation and, in particular, 
Resolution No. 4700 of 2009, Decree No. 2622 of 2009, Decree No. 4000 of 2004 and the general investment 
and exchange regime, a "substantial amo unt of capital" is foreign direct investment of an amount not less than 
US$100,000. WT/REG308/1 
 
- 29 - 
 
  c. Intra-company transferees (Part I, Section C) who seek to work in a managerial or 
executive position, or one that requires specialized knowledge. While the Parties may require acceptance of the work contract by the competent authority prior to granting the temporary entry authorization, they also ag ree to attempt to make more flexible or 
eliminate such requirement by January 2014; as  of end-July 2013, no progress has been 
achieved in this area. The Parties cannot apply quantitative restrictions in that respect, but may require a visa prior to such entry. 
d. Professionals and certain professionals of a technical nature listed in Appendix 13.4.D 
(Part I, Section D) that will work on the basis of a personal contract in the territory of the other Party. Such authorization will be issued as long as the business person presents (i) a proof of citizenship of a Party, (ii) documents describing the purpose of 
entry and the activities the person will engaged in, and (iii) documents proving his/her 
qualifications. The temporary entry of a professional does not imply the recognition of degrees and certificates, nor the issuing of work licences. The Parties cannot apply 
quantitative restrictions in that respect, but may require a visa prior to such entry. 
4.27.  Part II to Annex to Article 13.4 states that the temporary stay under (b)-(d) is one year, 
subject to extensions up to a maximum of 4 years, except that for traders or investors that are to 
make an investment the stay will be up to 183 days.  
4.28.  According to Article 13.7, a Party cannot initiate a dispute settlement procedure under 
Article 15.4 following the refusal of a temporary entry, unless the case is recurrent practice and the business person has exhausted all possible administrative remedies available.
27 
4.29.  The Agreement creates a Working Group on Temporary Entry and Stay (Article 13.66) which 
will meet at least once a year to examine the application of Chapter XIII, the elaboration of measures aimed at facilitating the temporary entry of business persons and proposals on changes 
or amendments to that Chapter; as of end-July 2013, this Group had not yet met. 
4.3.5  Performance requirements 4.30.  The prohibitions in Article 11.7 of certai n performance requirements, or of conditioning 
advantages upon their fulfilment, apply as regards investments
28 of investors not only from the 
other Party, but also from any third party, thus mu ltilateralizing such preferential treatment. Both 
lists of prohibited performance requirements ar e of an exhaustive nature. These provisions, 
however, apply to the scope of investments per se  rather than the GATS mode 3 "right of 
establishment"; they are however presented for the sake of completeness.  
4.31.  Seven categories of performance requirem ents are prohibited; while some of them (i.e. 
those relating to goods) are in any case already prohibited under the WTO Trade-Related 
Investment Measures (TRIMs), others are not - su ch as, for example, the prohibition of measures 
such as export obligations and technology transfer requirements. In addition, it is forbidden to condition the grant or receipt of an advantage - such as subsidies and tax exemptions - to 
investments of investors from the other Party or any other Party on the fulfilment of any of the 
four types of performance requirements listed in paragraph 3, including e.g. domestic content and 
trade balancing. 
4.32.  Paragraphs 2 and 4 of Article 11.7, respecti vely, make clear that the following requirements 
are not prohibited: (i) the mandatory use of technology for complying with health, security or 
environment requirements, or (ii) linking the rece ipt of an advantage for an investment on the 
requirement to locate the production, employ and train employees, or conduct research and 
development activities in its own territory. Para graph 6 in turn allows the use of measures, 
including environmental measures, to (i) ensure compliance with laws and regulations not in contradiction with the Agreement's disciplines; (ii) protect human, animal or plant life or health; 
(iii) protect exhaustible natural resources, provided they are not applied in an arbitrary or 
                                               
27 Administrative remedies are considered to be exha usted if a final determination on the matter has not 
been issued by the competent authority within one year  from the beginning of the administrative procedure, 
and that the failure to reach a verdict is not attributable to a delay caused by the business person. 
28 This applies to the establishment, acquisition, expansion, management, conduct or operation of an 
investment.  WT/REG308/1 
 
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  unjustified manner, or do not constitute a disguised trade or investment restriction. In addition, 
specific exceptions to this Article's disciplines, contained in paragraph 4.20.   above apply mutatis 
mutandis . 
4.33.  Other exceptions to the performance requirements prohibition are stated in Article 11.9:5; 
these allow that some of the above-mentioned specific TRIMs, or the granting of advantages 
conditional on some TRIMs, be applied when these are related to export promotion or external (tied-) aid, and procurement by a Party or a State-trading enterprise. Further, linking the grant of 
an advantage to certain TRIMs remains possible when the imported product benefits from a 
preferential tariff or a preferential quota.  
4.3.6  Senior management and board of directors 4.34.  For an enterprise established through an investment from investors of the other Party: 
a. as regards senior management, nationality requirements are prohibited; 
b. as regards the board of directors or its subsidiary bodies, nationality as well as residency 
requirements are authorized for the majority  of their representatives, provided such 
requirements do not significantly impair the investor's capacity to control its investment 
(Article 11.8) 
c. as regards the board of directors of a financial institution, Article 12.15 makes clear that 
nationality and/or residency requirements may be required vis-à-vis  a simple majority of 
the board, at most, unless the non-conformi ng measures say otherwise (Article 12.21, 
as reflected in paragraph 4.20.   above, mutatis mutandis).  
4.35.  Other exceptions to the prohibition on  nationality requirements are as follows:  
a. those contained in 4.20.   above, mutatis mutandis (Article 11.9); and  
b. foreign investments/investors in the context of (i) government procurement of a Party, 
or procurement from a State-trading enterprise ; and (ii) subsidies or grants, granted by 
a Party or by a State-trading enterprise (Article 11.10). 
4.4  Liberalization commitments 4.36.  The Agreement uses a hybrid approach; while market access commitments only apply to a 
positive list of services sectors covered, a negative list applies vis-à-vis  other disciplines. That 
means that, as regards all sectors or sub-sectors covered by chapters X-XII, the services suppliers of one Party operating in the market of the other Party benefit from non-discrimination - in terms of national treatment, MFN, local-presence  requirements, performance requirements and 
restrictions regarding representatives of senior management and boards of directors - except as 
otherwise provided in the Parties' lists of non-conforming measures. That constitutes per se a major distinction vis-à-vis  the GATS, in which the national treatment requirement is applied only in 
relation to covered services. These structural differences between the GATS and the trade in 
services provisions of the Agreement, combined with the hybrid approach used for the commitments, have to be taken into account when considering this section.  
4.37.  As indicated earlier, as of end-July 2013 Parties had not yet undertaken market access 
commitments with respect to financial services.  
4.38.  Tables 4.1 and 4.2 below summarize the specific commitments made by the Parties under 
the Agreement, by main sectors and subsectors, and compare them with the Parties' GATS 
Schedules; some salient feature of liberalization  are also briefly presented. The Tables also 
indicate, for cross-border trade in services, the sectors or subsectors to which market access commitments/limitations apply. Improvements in existing GATS commitments are either a 
reduction of the limitations applicable to market access and undertaking national treatment 
commitments in further sub-sectors. Horizontal limitations recorded in the Parties' GATS Schedules of Specific Commitments and reservations covering  all sectors in the Annexes to the Agreement, WT/REG308/1 
 
- 31 - 
 
  as well as MFN reservations or exemptions, are, in principle, not captured in the following Tables 
but are summarized at the beginning. Mode 4 commitments are also excluded from the Tables. 
4.4.1  Peru's liberalization commitments 4.39.  In its GATS schedule, Peru has made commitments in 42 out of 155 services sectors, 
essentially in mode 3, with some commitments in modes 1, 2, and - to a limited extent - 4, in 
telecommunications, and some insurance subsectors.  
4.40.  Peru's GATS MFN exemptions cover measures implementing its reciprocal labour 
agreements or on dual nationality; land and sea transport measures taken in the Andean context; 
land transport measures implementing the Conven tion on International Land Transport, the law 
promoting Latin American artists interpreting Latin American themes and certain measures designed to ensure reciprocity for certain financial intermediation services. Under the Agreement, 
Peru takes MFN reservations on radio transmission services within border areas, subject to 
authorizations, for existing measures. MFN-related general reservations are also registered for existing and future measures in all sectors, that  accord differential treatment to countries under 
any bilateral or multilateral agreements in force on , or signed prior to, the date of entry into force 
of the Agreement. The granting of differential trea tment is also reserved for future bilateral or 
multilateral agreements involving aviation, fisheries, or maritime matters, including salvage.  
4.41.  Moreover, as regards future measures, Peru reserves the right to adopt or maintain any 
measure according rights for the protection of indigenous, native and peasant communities; in matters related to fishing; cultural industries; handicraft; audio-visual industries; jewellery and certain other artistic activities; social services; water and sewage services; certain educational 
services; as well as both domestic and international land transportation of cargo or passengers in 
border areas. Future subsidies or grants by the State are also reserved by Peru for all sectors. 
4.42.  Under the GATS, Peru's horizontal limitations cover mainly modes 3 and 4 (the other modes 
not being covered in most cases) with limitations on the form and modalities applicable to 
commercial presence and foreign investment, including on the repatriation of capital by foreign companies established in Peru, as well as, inter alia , limitations of up to 20% on foreigners 
employed in enterprises established through foreign investment. Under the Agreement, Peru 
registers horizontal limitations covering national treatment and local presence, in addition to the above-mentioned MFN reservations, with regard to future subsidies or grants provided by the State. Other general limitations, applicable for all sectors, reserve to nationals investments in a 
frontier area of 50 km of and require that all empl oyers in Peru, independently of their activities or 
nationality, shall give preferential treatment to nationals when hiring, and that at least 80% of the staff of a company established in Peru be Peruvian, representing at least 70% of the total payroll 
of the company. That limitation is generally reflected in the Agreement's market access limitations, 
which are generally unbound with respect to mode 4 but which in any case remain subject to that requirement, as indicated in Annex III. 
Table 4.1 Peru: comparison between the GATS and the Agreement specific commitments 
in trade in services  
Sectors (CPC Classification) GATS FTA 
Sectoral 
Commit. Compared 
to the 
GATS Market  
access 
commit-
ments  
/limita-
tions NT, MFN, LP, SMBD  
Existing 
non-
conforming 
measure(s) Reser- 
vation(s) 
for future 
measures*  
 
1. Business services      
A. Professional Services Partial Improved L   
B. Computer and Related Services  --- New C   
C. Research and Development Services  --- New L   
D. Real Estate Services  --- New C   
E. Rental/Leasing Servic es without Operators  Partial Improved L   
F. Other Business Servic es Partial Improved L   
2. Communication services       
A. Postal services --- New    
B. Courier services --- New    WT/REG308/1 
 
- 32 - 
 
  Sectors (CPC Classification) GATS FTA 
Sectoral 
Commit. Compared 
to the 
GATS Market  
access 
commit-
ments  
/limita-
tions NT, MFN, LP, SMBD  
Existing 
non-
conforming 
measure(s) Reser- 
vation(s) 
for future 
measures*  
 
C. Telecommunication services  Partial Improved L   
D. Audiovisual services --- New    
3. Construction and related engineering 
services       
A. General construction work for buildings --- New C   
B. General construction work fo r civil Engineering --- New C   
C. Installation and assembly work  --- New C   
D. Building completion and finishing work  --- New C   
E. Other --- New    
4. Distribution services      
A. Commission ag ents' services --- New C   
B. Wholesale trade services Partial Improved C   
C. Retailing services Partial Improved C   
D. Franchising --- New C   
5. Education services      
A. Primary education services --- New    
B. Secondary education services  --- New    
C. Higher education services  --- New    
D. Adult education --- New    
E. Other education services  --- New    
6. Environmental services      
A. Sewage services --- New    
B. Refuse disposal services --- New    
C. Sanitation and similar services  --- New    
D. Other --- New    
7. Financial services      
A. All insurance and insu rance-related services  Partial Improved NYA   
B. Banking and other financial services Partial Improved NYA   
8. Health related and social services      
A. Hospital services --- New    
B. Other Human Health Services --- New    
C. Social Services --- New    
D. Other --- New    
9. Tourism and travel related services       
A. Hotels and restaurants (including catering) Partial Improved C   
B. Travel agencies and tour operat ors services Partial Improved C   
C. Tourist guides services --- New C   
10. Recreational and cu ltural and sporting 
services      
A. Entertainment services Partial Improved L   
B. News agency services --- Improved L   
C. Libraries, archives, museums and other 
cultural services --- Improved L   
D. Sporting and other recreational  services  Partial Improved L   
11. Transport services       
A. Maritime Transport Services Partial Improved    
B. Internal Waterways Transport Partial Improved    
C. Air Transport Services --- New    
D. Space Transport  --- New    
E. Rail Transport Services --- New    
F. Road Transport Services --- New C   
G. Pipeline Transport  --- New    
H. Services auxiliary to all modes of transport  --- New C   
I. Other Transport Serv ices  --- New    
 
Note:   
 NT National treatment. LP Local Presence. SMBD Senior management and board of directors. Partial: GATS commitments subject to some limitation(s ) under market access or national treatment, under 
any of the three modes. WT/REG308/1 
 
- 33 - 
 
  Full: GATS commitments not subject to limitation(s) under market access or national treatment, under 
any of the three modes (excluding "unbound" due to lack of technical feasibility). 
---: No commitments under GATS. New: New commitments made under the Agreement (full or partial, with or without market access 
commitments and/or limitations,). "New" can always be seen as "improved". 
Improved: Overall improved commitments made under the Agreement as compared to those under the GATS. Similar: Similar commitments (Agreement vs GATS); though possibly with limited improvements and/or 
limited additional reservations. 
C: At least partial commitment without limitation (excluding mode 4). L: At least partial commitment but subject to limitations. NYA Not yet agreed. : Reservation listed under the Party's Schedule. 
 Source:  Draft Consolidated GATS Schedule of Spec ific Commitments (S/DCS/W /PER), prepared by the 
Secretariat (in 2003) and Peru's Annexes to the Agreement.  
 
4.43.  Peru's sectoral liberalization under the Agreement goes beyond its GATS commitments. 
Construction and related engineering services - not covered under the GATS - were fully liberalized in terms of both market access (with the exception of "other", for which no market access commitment has been undertaken) and with no non-conforming measures. Tourism and travel 
related services - covered in the GATS only with respect to some sub-sectors and only liberalized 
in mode 3 - is fully liberalized as regards modes 1-3 in market access, and no reservation has been taken.  
4.44.  For postal and courier services, other construction services, refuse disposal services space 
transport services - not covered in the GATS - market access commitments have not been undertaken, but, on the other hand, no reservatio ns have been taken as regards non-conforming 
measures.  
4.45.  As regards business services, Peru covered some sub-sectors under the GATS; under the 
Agreement, full market access liberalization in all sub-sectors has taken place, with very few limitations (e.g. number of notaries related to the population). Non-conforming measures have 
been listed for some legal services, auditing and architectural services, R&D services, advertising 
services, services incidental to fishing, energy di stribution, and investigation and security; as well 
as for future measures in taxation services, services incidental to fishing and printing and 
publishing. Market access limitations apply to certain professional services, including e.g. legal 
services, accounting and auditing, architecture. 
4.46.  Regarding communication services, Peru has covered, under the GATS, some 
telecommunication services only. Market access commitments have been undertaken for additional 
sub-sectors under telecommunication services, as well as audiovisual services. Peru registers, however, limitations for existing measures in telecommunication services, particularly on call-back s e r v i c e s  ( a s  u n d e r  t h e  G A T S ) ,  a s  w e l l  a s  o n  a u d i o - v i s u a l  s e r v i c e s  ( t h r o u g h  a  " c u l t u r a l "  
reservation), and also market access limitations; in particular it reserves the right to impose 
quantitative restrictions regarding long-distance telecommunication services, both nationally and internationally. 
4.47.  For Peru, the financial services sector is bound with limitations under the GATS. Under the 
Agreement, Peru has bound its applied legal framew ork regime for financial services and, given the 
ratchet principle, has committed to bind any future  liberalization in this sector. Peru registers 
existing non-conforming measures for certain forms of asset management and certain types of 
advisory and other auxiliary financial services. Mo reover, it introduces a reservation for future 
measures for obligatory insurance.  
4.48.  Recreational and cultural and sporting services - covered in the GATS only with respect to 
some sub-sectors and only partially liberalized in mode 3 - is fully liberalized as regards modes 1-3 
in market access, but few reservations apply with  respect to percentages of nationals and their 
wages. 
4.49.  For transport services, Peru's specific commitments in the GATS are limited to passenger 
transportation for maritime transport services  and internal waterways transport. In the 
Agreement, no additional market access commitmen ts are undertaken in these sub-sectors, but 
that is the case for road transport and auxiliary transport services, according to which Peru fully WT/REG308/1 
 
- 34 - 
 
  liberalizes modes 1-3, while at the same time listing existing non-conforming measures for both 
sub-sectors. Non-conforming measures apply to freight transportation (for maritime and road 
transport services), support services for road tran sport services, and certain services auxiliary to 
all modes of transport (storage and warehouse services), and services related to passenger 
transportation (maritime transport services and internal waterways transport).  
4.4.2  Mexico's liberalization commitments 4.50.  In its GATS schedule, Mexico has made commitments in 74 out of 155 services sectors, in 
all modes of supply except in mode 4. Regardin g exemptions to the MFN provisions under the 
GATS, Mexico listed two tourism-related activities: the supply of road transport services by foreign providers is reserved to United States vehicles, and a preferential tax treatment (i.e. tax reductions for expenses incurred in Mexican territory) for individuals attending tourism business 
conventions which also apply only to United States individuals. 
4.51.  Compared to its GATS schedule, Mexico's horizontal commitments under the Agreement are 
deeper. In the latter, Mexico expands its commitments in modes 3 and 4, while maintaining a few 
restrictions
29 which, in most cases, echo those in the GATS schedule. With respect to mode 3, the 
Agreement states that the National Commission on Foreign Investment may, according to specific criteria, authorize foreign investment (acquisition or establishment) in restricted activities 
indicated in the List of Reservations.
30 This differs from the GATS, which permits foreign 
investment in activities reserved for Mexican nationals (and therefore restricted) but only through neutral shares (i.e. shares with no voting rights or with limited corporate rights) and with prior authorization. The Agreement also allows (without prior examination) foreign investments of up to 
49% in a Mexican company operating in an unrestricted sector.
31 In another reservation, the 
Agreement limits the acquisition by foreigners of land and water in Mexico, which mirrors the GATS. With respect to mode 4, the Agreement gr ants temporary entry to a broader category of 
business persons (i.e. business visitors, investors, intra-company transferees and professionals). 
In the GATS, market access and national treatment commitments for temporary entry concerns only natural persons who are directly responsibl e for the sale of a service, and executives, 
managers or specialists transferred within the sa me company. In addition, the Agreement applies 
nationality requirements to micro-industry enterprises and to the staff of Mexican cooperative production enterprises. The Agreement, like the GA TS, also specifies that positions related to the 
functioning and management of ships, aircrafts and trains are reserved for Mexican nationals. 
4.52.  Mexico listed 11 reservations on future measures: two horizontal - restricting acquisition or 
sale of governmental bonds and authorizing subsidies or grants by the government and state-enterprises - and nine sector-specific. The restrictions regard national and MFN treatment, 
local presence, and senior management and board of directors and apply in telecommunications 
(including investments in air transit control, aeronautical meteorology, flight control and other air navigation services), social services, minority- and energy-related services, gambling and betting 
services, and two regarding financial services. 
Table 4.2 Mexico: comparison between the GATS and the Agreement specific 
commitments in trade in services  
Sectors (CPC Classification) GATS FTA 
Sectoral 
Commit. Compared 
to the GATS  Market  
access 
commit-
ments 
/limita-
tions NT, MFN, LP, SMBD  
Existing 
non-
conforming 
measure(s) Reser- 
vation(s) 
for future 
measures*  
 
1. Business services      
A. Professional Services Partial Improved C   
B. Computer and Related Services  Partial Improved C   
C. Research and Development Services  Partial Improved C   
                                               
29 Under the GATS, Mexico made horizontal commitments in all modes. Full commitments were made in 
modes 1 and 2, while in modes 3 and 4 commitments were limited. 
30 Restricted sectors are all those activities which appear in the list of State-reserved activities. Such 
activities are restricted to foreign in vestors as well as Mexicans. Furthermor e, the list of reservations includes 
the sectors restricted to foreign particip ation under the Law on Foreign Investment. 
31 Unrestricted sectors are those which do not appear in the list of reservations. WT/REG308/1 
 
- 35 - 
 
  Sectors (CPC Classification) GATS FTA 
Sectoral 
Commit. Compared 
to the GATS  Market  
access 
commit-
ments 
/limita-
tions NT, MFN, LP, SMBD  
Existing 
non-
conforming 
measure(s) Reser- 
vation(s) 
for future 
measures*  
 
D. Real Estate Services  --- New    
E. Rental/Leasing Services without Operators  Partial Improved C   
F. Other Business Services Partial Improved C   
2. Communication services       
A. Postal services --- Similar    
B. Courier services Partial Improved    
C. Telecommunication services  Partial Improved L   
D. Audiovisual services --- New C/L   
3. Construction and related engineering 
services       
A. General construction work for buildings Partial Improved    
B. General construction work for civil Engineering Partial Improved    
C. Installation and assembly work  Partial Improved    
D. Building completion and finishing work  Partial Improved    
E. Other --- New    
4. Distribution services      
A. Commission agents' services --- New C   
B. Wholesale trade services Full Improved C   
C. Retailing services Full Improved C   
D. Franchising --- New C   
5. Education services      
A. Primary education services Partial Improved    
B. Secondary education services  Partial Improved    
C. Higher education services  Partial Improved    
D. Adult education --- New    
E. Other education services  Partial Improved    
6. Environmental services      
A. Sewage services --- New    
B. Refuse disposal services --- New    
C. Sanitation and similar services  --- New    
D. Other --- New    
7. Financial services      
A. All insurance and insurance-related services  Partial Improved NYA   
B. Banking and other financial services Partial Improved NYA   
8. Health related and social services      
A. Hospital services Partial Improved    
B. Other Human Health Services Partial Improved    
C. Social Services --- New    
D. Other --- New    
9. Tourism and travel related services       
A. Hotels and restaurants (including catering) Partial Improved C/L   
B. Travel agencies and tour operators services Partial Improved    
C. Tourist guides services Partial Improved    
10. Recreational and cultural and sporting 
services      
A. Entertainment services --- New C   
B. News agency services --- New C   
C. Libraries, archives, museums and other cultural 
services --- New C   
D. Sporting and other recreati onal services  --- New C   
11. Transport services       
A. Maritime Transport Services --- New    
B. Internal Waterways Transport --- New    
C. Air Transport Services Partial Improved    
D. Space Transport  --- New    
E. Rail Transport Services --- New    
F. Road Transport Services Partial Improved C   
G. Pipeline Transport  --- New    
H. Services auxiliary to all modes of transport  Partial Improved    
I. Other Transport Services  --- New    
Note:   
 * In addition, non-conforming measures on  minority and energy-related services.  
NT National treatment. LP Local Presence. 
SMBD Senior management and board of directors. WT/REG308/1 
 
- 36 - 
 
  Partial: GATS commitments subject to some limitation(s ) under market access or national treatment, under 
any of the three modes. 
Full: GATS commitments not subject to limitation(s) under market access or national treatment, under 
any of the three modes (excluding "unbound" due to lack of technical feasibility). 
---: No commitments under GATS. New: New commitments made under the Agreement (full or partial, with or without market access 
commitments and/or limitations,). "New" can always be seen as "improved". 
Improved: Overall improved commitments made under the Agreement as compared to those under the GATS. Similar: Similar commitments (Agreement vs GATS); though possibly with limited improvements and/or 
limited additional reservations. 
C: Commitment, no limitati on (excluding mode 4). 
L: Committed but subject to limitations. NYA Not yet agreed. : Reservation listed under the FTA Party's Schedule. 
 Source:  Draft Consol idated GATS Schedule of Specific Commitments (S/DCS/W/MEX), prepared by the 
Secretariat (in 2003) and Mexico's Schedule annexed to the Agreement.  
 
4.53.  Mexico's sectoral liberalization under the Agreement goes beyond its GATS commitments. 
Recreational, cultural and sporting services - excl uded from the GATS - are almost fully liberalized 
(partial market access commitments on one subsector and few non-conforming measures). For 
real estate services, other construction services , adult education services, environmental services, 
other health and related services and space transp ort services - not covered in the GATS - market 
access commitments have not been undertaken, bu t, on the other hand, no reservations have 
been taken as regards non-conforming measures.  
4.54.  In the case of business services, Mexico  extended its GATS commitments but maintains 
various reservations. Market access has been fully liberalized in an additional nine subsectors, including all computer and related services, and al so e.g. rental of aircrafts without crew and 
printing services. Market access has been improved with respect to eight sectors, either by fully 
liberalizing modes 1 or 3; these include rese arch and development, placement and supply of 
services of personnel and building-cleaning serv ices. In professional services, Mexico removed 
mainly mode 3 restrictions in architecture, engineering and medicine, and specified reservations 
mainly in the form of local presence and nationality requirements for doctors, customs brokers (also in the GATS), accountants, public brokers, ve terinaries and lawyers. Restrictions on fishing, 
agriculture, energy (oil), manufacturing, and printing and publishing services remain, most of 
which apply to investments and take the form of nationality and performance requirements.  
4.55.  For communications services, no market access commitments are undertaken in postal or 
courier services, both of which were excluded from  the GATS schedule; at the same time, the only 
restriction maintained concerns the provision of first class postal services, which is reserved for the 
Mexican State. As regards market access, audiovisual services - excluded from the GATS - are fully liberalized, while still requiring authorization and classification. Market access in 
telecommunication services - through public networks but excluding radiodiffusion - has also seen 
mode 3 fully liberalized (in GATS only partial liberalization applied); the same applies to mode 1 for facsimile services. International traffic of the former remains however subject to the use of an international port of an operator to whom a concession has been granted. As regards 
non-conforming measures, investments of foreig n governments and state enterprises in Mexican 
companies providing telecommunications is not permitted, and the provision of telegraphy and radiotelegraphy services is reserved for the Mexican State. In the case of audiovisual, reservations 
take the form of nationality and performance re quirements and apply to radio and television 
services. In the case of cable television, in additi on to a nationality requirement, local presence is 
required: cable television providers need a concession which can only be granted to Mexican 
nationals and companies. Moreover, foreign investment in such companies is limited to 49%.  
4.56.  In the case of distribution services, Mexico liberalized commission agents' services and 
franchising, which excluded from the GATS. It also  liberalized wholesale trade-restricted under the 
GATS. In retailing services, it made broader commitments but restricted Peruvian equity 
participation in Mexican companies engaged in arms, cartridges and ammunition trade to 49% - 
less restrictive than in the GATS, where the reta il sales of arms, cartridges and ammunition trade 
by foreigners is prohibited. It also restrictions for petroleum-based fuels - only Mexican nationals 
and Mexican enterprises with a foreigners' exclusion clause can acquire, establish or operate gas 
stations for the distribution or retail sale of gasoline, diesel, lubricants, oils or additives, and for WT/REG308/1 
 
- 37 - 
 
  the retail distribution of liquefied petroleum gas, and market access restrictions regarding retail 
distribution of charcoals, coal and other non-petroleum based fuels. 
4.57.  As for educational services, the Agreement improves commitments by liberalizing mode 4, 
which is restricted across all subsectors under the GATS, and by adding full commitments in adult 
education services. The only reservation under the Agreement mirrors that under the GATS - a 
mode 3 restriction on foreign investment in primary, secondary and higher education of up to 49%, and the need for prior authorization. 
4.58.  In the case of financial services, Mexico added new commitments but liberalization vis-à-vis  
Peruvian suppliers remains subject to 11 existing reservations in Section A, and two in Section B. As regards existing reservations, three apply to both subsectors, seven to banking only and three 
to insurance only. Mexico has bound its applied legal framework regime for financial services, and, 
given the ratchet principle, has committed to bind any future liberalization in this sector.  
4.59.  Regarding transport services, market access commitments are undertaken only on one 
sub-sector of road transport services, namely ma intenance and repair of equipment, with mode 3 
becoming fully liberalized. Other transport services only benefit from non-discrimination subject to 
listed reservations. Reservations include a prohibition on investments by foreign governments and state enterprises in Mexican companies providing transportation services; local presence and 
national treatment limitations regarding maritime, rail and pipeline transport services; reservation 
on the transportation of goods other than fuels for Mexican nationals and enterprises; and in airport and helicopter administration services, the granting of concessions to build and/or operate airports and heliports only for Mexican nationals and companies with foreign equity participation 
limited to 49%, though higher foreign participation is authorized subject to authorization - 
compared to the GATS in which priority is given to Mexicans over foreigners regarding concessions, and foreign equity participation is limited to 30%. In road transport services, 
reservations take the form of MFN treatment, nationality and local presence requirements and 
apply mainly to passenger transportation and supporting services; they include reserving for 
nationals administrative services for passenger bus stations and terminals and the supply of local 
bus and school buses, taxi and collective transportation services - in the latter case, Mexican 
companies with a foreign exclusion clause are also authorized; and reserving specialized staff positions such as captains, pilots or machinists of ships or aircrafts, as well as port captains, harbour pilots, airfields commanders and customs agents for Mexican nationals by birth.  
4.5  Regulatory provisions  
4.5.1  Domestic regulation 4.60.  The disciplines of Article 10.9 cover all the four modes of supply, since Article 10.2.4 
extends domestic regulation disciplines to the right of establishment in the context of an 
investment; any dispute settlement between a Party and an investor of the other Party is however regulated by Section C of Chapter XI. 
4.61.  Article 10.9 provides that, whenever an auth orization is needed for the supply of a services, 
the Party's competent authorities will inform the in terested person within a reasonable period of 
time of the decision made, and, upon request by th e latter, of the progress attained in the request. 
4.62.  The Parties commit to ensure that any measure adopted or maintained on the licensing, 
certification, or technical standards of service suppliers of the other Party does not constitute an 
unnecessary barrier to cross-border trade in services  (covered by Chapter X) as provided in GATS 
Article VI.
32 To this end, measures (a) are based on objective and transparent criteria, such as 
competence and the ability to supply the services; (b) are not more burdensome than necessary to 
ensure the quality of the services; and (c) do not constitute a disguised restriction on the cross-border supply of the services. 
4.63.  Any progress achieved in the GATS with respect to these questions may require an 
adaptation of disciplines in this Article. 
                                               
32 It is worth mentioning that this provision applies to all the sectors covered in Chapter X, while in the 
GATS domestic regulation provisions apply only to sectors where specific commitments were undertaken. WT/REG308/1 
 
- 38 - 
 
  4.64.  Domestic regulation will apply to the right of establishment in the context of an investment, 
as defined in Chapter XI; however, no provision of Chapter X may be subject to dispute settlement 
between a Party and an investor of the other Pa rty, as these are regulated by Section C of 
Chapter XI. 
4.5.2  Recognition 
4.65.  Article 10.11 foresees the possibility that a Party recognizes the training, experience, licence 
and/or certification obtained in another country towards the authorization, granting of licence or 
certification of services suppliers in its own territory. This may be achieved through harmonization 
or other means, and may be based in an agreement or convention concluded with the other country, or may be autonomously granted. No regulation or criterion in that respect may constitute a disguised barrier to trade in services. 
4.66.  Nothing in the Agreement obliges a Party to grant to the other Party MFN treatment as 
regards recognition granted to a third-party. (Article 10.11:2) 
4.67.  Annex to Article 10.11 sets out procedures and criteria to grant licences or certification 
applying to suppliers of professional services, wi th the aim of harmonizing them so that mutual 
recognition can be applied. A Working Group on Prof essional Services is established to pilot such 
work. Up to end-July 2013, this Group had not yet met. 
4.68.  As for financial services, the recognition of prudential measures of the other Party is also 
envisaged, and best endeavour clauses are provided for in that sense (Article 12.8). 
4.69.  Chapter XIV sets out the procedures and criteria for mutual recognition for academic 
certificates, titles and degrees, on the basis of exis ting conventions or agreements on this subject. 
In case of incompatibility between this Chapter and any these other instruments, the former 
prevails to the extent of the incompatibility. It applies to any person having accomplished its studies in any of the Parties, irrespective of its nationality, planning to exercise a profession or 
continue its post-secondary education. 
4.70.  The basic principle of Chapter XIV is that of reciprocal automatic recognition of academic 
certificates, titles and degrees; Article 14.4 however specifies situations where this cannot be 
reasonably granted and criteria to remedy such a situation. The Chapter also addresses questions 
such as pre-professional practice, studies accomplished in another foreign country, and sets a 90 day timeframe for issuing a resolutions as regards equivalence of degrees. Article 14.7 addresses in particular acceptance of the other Party's documents as regards access to certain 
professions. Finally, a Committee on Mutual Recognition (Article 14.9) is established. Up to end-
July 2013, this Committee had not yet met. 
4.5.3  Subsidies 
4.71.  Article 10.3 provides for the exchange of information regarding all types of governmental 
subsidies and grants, both present and future, provid ed to domestic services suppliers; the first of 
such exchange of information is to take place within one year from the Agreement's entry into 
force. Any progress achieved in the GATS with respect to these questions may require an 
adaptation of disciplines of this Article. 
4.5.4  Safeguards 4.72.  The BOP exception to the general freedom  of capital movement is also addressed in 
Article 18.5, which provides that in cases of seriou s difficulties, or threat thereof, regarding BOP or 
the external financial situation of a party, the party may adopt or maintain trade-restrictive measures or price-based measures - namely import surcharges, import deposit requirements or 
other equivalent trade measures with an impact on the price of imported goods - with respect to 
imports of goods and services, payments and ca pital movements, including those referring to 
direct investment. These measures shall be accompanied, as soon as possible, with a calendar for 
their elimination; detailed information on the situation also must be supplied to the other Party. In 
any case, the measures adopted will (i) avoid unnecessary injury to the economic, commercial and financial interests of the other Party; (ii) not exceed what is necessary to address the existing WT/REG308/1 
 
- 39 - 
 
  difficulties; (iii) be of a temporary nature and liberalized progressively; (iv) be applied in 
accordance with the most favourable principle between that of national treatment and MFN; and (v) be compatible with the WTO and the IMF requirements, as well as other internationally-accepted criteria.  
4.5.5  Other investment-related provisions 
4.73.  In addition to the information presented above, Chapter XI on investments includes 
provisions dealing with the granting of the mini mum standards of treatment, including fair and 
equitable treatment, to investments of investors of another Party in accordance with customary 
international law (Article 11.6); compensation for losses (Article 11.11); expropriation and compensation (Article 11.12); transfers (Article 11.13); special formalities and information requirements (Article 11.14); environment-related concerns (Article 11.17), and a fully-fledged 
investment-related dispute settlement mechanism (Articles 11.18-11.35). 
4.6  Sector specific provisions on trade in services 4.6.1  Financial Services 
4.74.  While numerous provisions specific to financial services can be found elsewhere in this 
Factual Presentation, other provisions are presented in paragraphs below. 
4.75.  As regards cross-border trade in financial services, Article 12.5 allows persons located in 
one of the Parties, and its nationals wherever loca ted, to purchase cross-border financial services 
from the other Party located in the territory of that other Party; that however does not oblige a Party to allow such service suppliers to "do business" or "solicit" in its territory, in terms of the Parties' individual definitions of both concepts. If  a Party allows the supply of financial services, a 
registration may be required for the service supplier of the other Party and its financial 
instruments. Nothing in this Article imposes an obligation to allow cross-border supply of financial services by financial institutions of the other Party or by investors or investments from the other 
Party; further, disciplines on right of establishment do not extend to non-conforming measures 
listed in Sections A and B of Annex VI, in accordance with the terms and conditions presented in paragraph 4.20.   above, mutatis mutandis . 
4.76.  The Financial Services Chapter includes an  in-built agenda by committing the Parties to 
mutual "future negotiations" aimed at the gradual liberalization of the non-conforming measures. Additional work regarding disciplines on market access and quantitative restrictions is also foreseen (Articles 12.21 and 12.22, respectively).  As of end-July 2013, no timeframe had been set 
for initiating this work. 
4.77.  The Parties will allow financial institutions of the other Party to supply any new service that 
the Party would permit to its own financial institutions. The Parties reserve the right to decide the 
institutional and juridical form employed to supply such services and to establish an authorization 
requirement (Article 12.13).  
4.78.  With regard to financial services exceptions, Article 12.9 makes clear that: 
a. nothing in Chapters X-XIII shall be interpreted as forbidding a Party to adopt or maintain 
prudential measures, including on transfer restrictions, to protect investors, depositors, claimants or persons to whom a fiduciary duty is owed by a financial institution or a cross-border financial service provider; and to  ensure the integrity and stability of the 
financial system; and 
b. provisions of Chapters X-XIII do not apply to non-discriminatory measures of general 
application adopted by a public entity in the field of credit or currency policies, except for 
the prohibition of performance requirements.  
4.79.  The Agreement establishes a Committee on Financial Services (Article 12.11); its main 
tasks are to monitor the application of the provisions in this Chapter, to consider any issues 
submitted by the Parties, to help to resolve any dispute that may arise between the Parties 
(Article 12.19) and with investors (Article 12.20), to facilitate the exchange of information between WT/REG308/1 
 
- 40 - 
 
  the supervising authorities of each Party, and to assist in matters regarding prudential measures, 
harmonization of standards, as well any other related-policies. The Committee will meet at least once a year to assess the functioning of the Chapter concerning financial services. 
4.80.  Additional rules concerning financial services are provided for in cases of expropriation and 
compensation (Article 12.18). Financial services-specific dispute settlement rules are contained in 
Articles 12.19 and 12.20. 
5  GENERAL PROVISIONS OF THE AGREEMENT 
5.1  Transparency 
5.1.  In addition to a number of transparency provisions disseminated throughout the Agreement 
and referred to elsewhere in the Factual Presentati on, Chapter XVI is dedicated to Transparency; it 
describes the provisions regarding the Parties' focal points, the publication and provision of 
information, as well as those guaranteeing hearings, legality and due process. 
5.2.  Under Article 16.2, each Party will designate a contact point to facilitate communication 
between the Parties on any matter covered by the Agreement. At the request of a Party, the 
contact point of the other Party will indicate the office or official responsible for the matter and 
assist, as necessary, in facilitating communication with the requesting Party. 
5.3.  The Parties will also ensure that their laws, regulations, procedures and administrative rulings 
of general application with respect to any matters under the Agreement are published promptly or 
made available to the Parties and interested persons. Beyond that, each Party has committed "to the extent possible": 
a. to make an advanced publication of any measure that relates to the Agreement, and to 
provide an opportunity to ask for information or make comments (Article 16.3); 
b. to notify the other Party of any measure that the Party considers can significantly affect 
the interests of the other Party under the Agreement, and upon request by the other 
Party, provide information and promptly respond to questions pertaining to any 
measure, whether or not the requesting Party has been previously notified of that measure. Any notification or information provided under this Article shall be without 
prejudice to whether the measure is consistent with this Agreement (Article 16.4). 
5.4.  The Parties confirm the guarantees provided  for hearings, legality and due process in their 
respective legislations. They also commit to ensure that in any administrative and judicial proceeding related to any measure affecting the Agreement, reasonable opportunity will be 
guaranteed for persons to present their respective  positions, and the motivation and legal grounds 
are established. 
5.5.  A specific services provision (Article 10.10) provides for the establishment by each Party of 
"adequate mechanisms" to provide information in respect of regulations on cross-border trade in 
services, in conformity with domestic transparency laws and with due account being taken of limitations that small administrative organizations may face. Specific disciplines are also provided 
for regarding financial services-related measures, including through publication and/or written 
notice (Article 12.10). Further, a timeframe - 180  days - is specified within which a competent 
authority is to make a decision regarding the provision of a financial service following a completed application by an investor in a financial institution, a financial institution or a cross-border financial 
service provider of another Party. 
5.2  Current payments and capital movements 5.6.  The Agreement does not include a specific provision regarding payments and capital 
movements for goods, but it does for cross-border trade in services (Article 10.12), investment 
(Article 11.13) and financial services (Article 12.17). However, paragraph 3 of Article 12.9 authorizes limitations on transfers from a financial institution or a cross-border supplier of financial 
service to a related person or company for prudential reasons. WT/REG308/1 
 
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  5.7.  Under the above-mentioned Articles, the Parties shall permit that all transfers relating to the 
cross-border supply of a service be made freely and without delays, in a currency benefitting from free circulation and under normal current exchange rate. However, limitations on transfers and payments are authorized (Articles 10.12:3, 11. 13:4 and 12.17:4) in cases of bankruptcy, 
insolvency or the protection of the rights of creditors; dealing in securities; criminal or penal 
offences; reports of transfers of currency or other monetary instruments; ensuring the satisfaction of judgments in adjudicatory proceedings and se rious balance-of-payments (BOP) difficulties or 
threat thereof. 
5.3  Exceptions 5.8.  Exceptions to the Agreement's disciplin es are contained in Chapter XVIII, as follows: 
a. General exceptions (Article 18.1) are regulated by incorporating into the Agreement 
Article XX of the GATT 1994 and its interpretive notes - as exceptions to Chapters III-IV 
and VII-VIII - and GATS Article XIV as exceptions to cross-border trade in services.  
b. National security exceptions (Article 18.2) establish that nothing in the Agreement shall 
be interpreted as requiring a Party to provide or allow access to confidential information 
contrary to its security interests, nor to forbid that adoption of measures necessary to protect a Party's essential security interests
33 and to fulfil its obligations in accordance 
with the United Nations Charter on the maintenance of international peace or security. 
c. Exceptions relating to the disclosure of information (Article 18.3) provide that nothing 
under the Agreement obliges the Parties to furnish or allow access to confidential 
information whose disclosure could impede law enforcement or be contrary to a Party's 
laws protecting personal privacy, financial and taxation affairs, and accounts of individual 
customers of financial institutions, as well as be contrary to public interest. 
d. Taxation exceptions (Article 18.4) make clear that generally the Agreement does not 
apply to taxation matters nor affects any taxation convention. The Agreement does 
however apply to Article 3.3 (national treatment), 3.9 (taxes on exports), 11.2 and 12.18 (expropriation and compensation of investments and of financial services), under 
the terms and conditions specified in relevant paragraphs of Article 18.4. 
e. BOP measures, as specified in paragraph 4.72.   above. 
5.4  Accession and Withdrawal 5.9.  The Agreement may be acceded to by any LAIA member country, subject to negotiations 
(Article 19.5). 
5.10.  Either Party can terminate the Agreement. Such termination will take effect 180 days
34 after 
notification to the other Party and the LAIA General Secretary; if in the future other countries join 
the Agreement, such withdrawal will not affect its application between the remaining Parties 
(Article 19.6). For the investments made during the Agreement's application, its investment disciplines will remain in force for 10 years following its termination. 
5.5  Institutional framework 
5.11.  The paragraphs below describe some of the main governing bodies under the Agreement; 
others have already been referred to elsewhere in this Factual Presentation. 
5.12.  The Agreement's main body is the Administrative Commission, established in accordance 
with Article 17.1. The Commission consists of the representatives of Mexico's Secretary of 
Economy and of Peru's Minister of Foreign Trad e and Tourism, or their designees. The Commission 
is responsible for enforcing and implementing  the Agreement and considering and adapting 
                                               
33 Including trade on arms and military equipmen t; war and other emergency situations and the 
non-proliferation of nuclear weapons or other nuclear explosive devices. 
34 The Parties may agree on another period of time. WT/REG308/1 
 
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  decisions towards these aims, including e.g. im provements in market access and adding new 
"denominations of origin"; recommending amendments to the Agreement; develop mechanisms for an active participation of business; seeking to resolve disputes that may arise according to Chapter XV; determining remuneration and expenses related to the latter; supervising the work of 
all bodies established under the Agreement; and any other matter that may affect the operation of 
the Agreement. The Agreement foresees that the Commission establishes its own rules and procedures (as of end-July 2013, not yet adopted); all its decisions are to be taken by mutual 
agreement. The Commission is to meet at least once a year, and will be chaired successively by 
each Party.  
5.13.  The Commission may also establish subsidiary bodies and issue interpretations on the 
Agreement's disciplines according to Article 17.3.  
5.14.  The Committee on Rules of Origin and Origin-Related Procedures (Article 4.38) has, beyond 
its traditional functions of ensuring the effective implementation and administration of the rules or origin chapter and the implementation of any agreed change, assumed an important role relating 
to trade facilitation. It is invited to present proposals for implementing customs procedures aimed 
at e.g. reducing timeframes related to dispatch ing and risk evaluation procedures. Article 4.37 
establishes a Committee on Short Supply to evaluate the difficulties faced by producers in 
accessing certain textiles materials (of HS 50-63) needed for the production of final goods, and to 
decide on allowing temporarily or indefinitely their import from third-parties. The Committee, 
established for an initial period of ten years (extendable through agreement by the Commission), is to adopts its regulations one year from the en try into force of the Agreement. By end-July 2013, 
no such regulations have been adopted.   
5.6  Dispute settlement 5.15.  Chapter XV of the Agreement describes the mechanism for the settlement of disputes 
between the Parties; in the case of settlement of disputes regarding measures in the financial 
services sector few specificities apply, while disputes between a Party and an investor of the other Party are however regulated by Section C of Chapter XI (see paragraphs 5.18.  and 5.19.   below, 
respectively).  
5.16.  The Chapter applies to disputes related to the interpretation or application of the Agreement 
as regards: (a) a measure of the other Party, either  in force or proposed, is inconsistent with the 
Agreement; (b) the other Party has not complied with the obligations of the Agreement; or (c) a 
measure of the other Party may cause nullification or impairment of any benefit that a Party could 
reasonably expect from the Chapters on market ac cess, rules of origin, SPS, TBT and cross-border 
trade in services. The Parties will endeavour to achieve a mutually satisfactory solution to any 
dispute arising from the interpretation and application of the Agreement (Article 15.4). For any 
disputes with respect to the obligations under the Agreement and the WTO, the Parties may select the forum in which to settle the dispute; once th e Party has requested the establishment of panel 
under one or the other, that forum must be used to the exclusion of others (Article 15.3). 
5.17.  The dispute settlement mechanism provides for consultations, intervention of the 
Administrative Commission, possible cumulation of two or more complaints in a single case, and, except for projected measures, the establishment of a Panel (composed of three members) which 
will examine the case and present a final report to  the disputing Parties. The system provides for a 
preliminary report on which the Parties can comment, a final report (on which comments of a form nature are also possible), and an implementation mechanism that may lead to retaliation 
authorization but also a review of these measur es. The Agreement foresees that Model Rules of 
Procedure are to be agreed by July 2012 (Article  15:10); by end-July 2013, this work was still in 
progress. Cross-retaliation in financial services is not authorized. WT/REG308/1 
 
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  Chart 5.1 Dispute Settlement Provisions of the Agreement 
 
Note: Figures in brackets refer to ti ming in cases of perishable goods. Max. 10 (5) days  
Technical advice requested (Art. 15.11)     Technical advice requested (Art. 15.5:4(a))  
Good offices, conciliation, mediation (Art. 15.5:4(b))
 
Issue of recommendations (Art. 15.5:4(c))  
 Max. 30(20) days   Consultations (Art. 15.4.6)  
Referral to Commission (Art. 15.5)  
Meeting of the Commission within 10 days   Max. 30(15) days
 Request for establishment of Panel  (Art. 15.6)
 Preliminary Panel report (Art. 15.12)  Max. 40 days
 90(45) days   Composition of Panel (Art. 15.9)
 15 days
 Max. 15(10) days   Comments by the Parties (Art. 15.12:4)
 Final Panel report transmitted  
to the Parties (Art. 15.13)   Max. 30(25) days  
 Publication  (Art. 15.13:7)   15 days Request for corrections(of form)  by the Parties (Art. 15.13:6) 10 days
 Implementation (Art. 15.14) 20   days
 If compliance/agreement  
 60 days from constitution of Panel    Recourse to Panel  by the other Party   
(Art. 15.15:6)  
 Panel's Final decision (Art. 15.15:7 )  Suspension of benefits  
by the Complaining Party until the  
decision implemented  
(Art. 15.12:2)  If non-compliance/a greement in 30 days   
 Termination   Recourse to Panel  
by Defendant Part y 
Panel composition  Implementation 
review (Art. 15.16)  
Final decision  60 days 
Retaliation 
eliminated  Retaliation 
maintained  Response to 
Consultations  
  (Art. 15.4)   Technical consultations  
  (Art. 7.11 and 8.11)   Request for consultations (Art. 15.4)  WT/REG308/1 
 
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  5.18.  In case of a dispute between the Parties regarding the Financial Services Chapter, the 
Committee on Financial Services will establish a li st of individuals (up to 10), who are competent 
to act as arbitrators in the Panel. Also in this sector, if the dispute is between an investor and a Party (i.e. in accordance with Chapter XI disciplines) and the defendant claims any of the 
exceptions under Article 12.9 (see paragraphs 4.21.  , 4.78.  and 5.6.  ), the Panel will refer the 
case to the Financial Services Committee for a decision. 
5.19.  The mechanism for the settlement of disputes  between a Party and an investor of the other 
Party, which is set forth in Chapter XI (Section C), is established to deal with a presumed breach 
of an obligation in Section B (Articles 11.3-11.17) of Chapter XI leading to damage. It encourages the settlement of the dispute primarily through consultation and negotiation. A claim may be submitted by an investor on its behalf or of a company; a claim by an investment is however not 
allowed. A claim qualifies for the arbitral procedure if the investor has incurred a loss or damage 
by reason of that breach, and the breach has taken place at least six months before (Article 11.20). The claim will be submitted according to th e rules and procedures of the (i) International 
Centre for Settlement of Investment Disputes (ICSID) (if both Parties are signatories to the ICSID 
Convention); (ii) the Additional Facility Rules of ICSID (if either the disputing Party or the Party of 
the investor, but not both, is a party to the ICSID Convention); (iii) Arbitration under the United 
Nations Commission on International Trade Law (UNCITRAL) arbitration rules; or (iv) any other 
arbitration institution or rules agreed between the Parties.
35 A claim may only be subject to 
arbitration upon the complainant's affirmation that the arbitration will be in accordance with procedures established in Chapter XI, and that the right to recourse to any other administrative or 
judicial tribunal in the complaining Party, or any other binding dispute settlement procedure is 
renounced. The arbitration will be guided by the relevant arbitration rules, subject to modifications spelled out in the Section; it includes the settlement of the dispute by an Arbitral Tribunal 
composed of three members and timeframes associated with all stages of the proceedings 
(Article 11.22).
36 When a final award has been made by the tribunal against a respondent, it can 
only award monetary damages and any applicable interest or property restitution. If the claim is 
by an investor on behalf of a company, the award is to be made to the enterprise (Article 11.31). 
If a disputing Party fails to abide by or comply with a final award, the Party whose investor was a party to the arbitration may have recourse to the dispute settlement procedure under Chapter XIX (Article 11.31).  
5.20.  Article 11.35 carves out from dispute settlement provisions - under both Section C and 
Chapter XV - a decision by a Party to prohibit or restrict the acquisition of an investment in its territory by an investor of the other Party, or its investment, on grounds of national security in 
conformity with Article 18.2. Investment-specific dispute settlement provisions (Section C of 
Chapter XI) cannot be used as regards MFN disciplines insofar as these are already provided for in other international trade or investment agreements. Also carved out from dispute settlement is 
any decision taken by Me xico's National Commission on Foreign Investment regarding whether or 
not to permit an acquisition or establishment of a foreign investment in restricted activities.  
5.7  Relationship with other agreements concluded by the Parties 5.21.  The Parties confirm their existing rights and obligations with respect to each other under the 
WTO Agreement and other agreements to which such Parties are party (Article1.3). 
5.22.  Mexico and Peru are Parties to the Pacific Alliance, a free-trade area also comprising Chile 
and Colombia. The Pacific Alliance Framework Agreem ent and its Additional Protocol were signed in 
June 2012 and February 2014, respectively; as of March 2014, they had not entered into force. 
The Alliance is a regional integration area aiming at the free movement of goods, services, capital 
                                               
35 As of end-July 2013, Peru is a Party to ICSID but not Mexico. No claim shall be made if it has already 
been submitted to an administrative or judicial tribuna l in the complaining Party, or any other binding dispute 
settlement procedure (Article 9-17). 
36 Detailed procedural steps are provided for, from the notice to intent to submit a claim to arbitration to 
the decision and enforcement of an award. It includes provisions regarding the conditions preceding the 
submission of a claim to arbitration;  the number of arbitrators and method of appointment; the constitution of 
a Tribunal when a party fails to appoint an arbitrator or  the disputing Parties are unable to agree on a presiding 
arbitrator; consent to the appointments of arbitrators; consolidation of multiple claims; communication/notice; 
Parties' participation; documents; place of arbitration; the interpretation of annexes; provisional and interim measures; and general matters WT/REG308/1 
 
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  and persons. There are 30 Observers States to the Pacific Alliance, of which Costa Rica and 
Panama as "Observer State Candidates".37 
5.23.  Other regional trade agreements to which Mexico and Peru are parties are listed in Table 
5.1.  
Table 5.1 Mexico and Peru: Participation in other RTAs (notified and non-notified in 
force), as of April 2014a 
Partner/ 
Agreement Date of 
entry 
into 
force Type of 
agreement GATT/WTO Notification 
Year WTO Provision 
MEXICO 
Central America b Goods & Services  2014 GATT Art. XXIV & GATS Art. V 
Japan 01.04.05 Goods & Services  2005 GATT Art. XXIV & GATS Art. V 
Uruguay [LAIA, AAP.CE N°60] 15.07.04 Goods & Services  2013 GATT Art. XXIV & GATS Art. V 
EFTA 01.07.01 Goods & Services  2001 GATT Art. XXIV & GATS Art. V 
European Union 01.07.00 
01.10.00 Goods 
Services 2000 
2002 GATT Art. XXIV 
GATS Art. V 
Israel 01.07.00 Goods 2001 GATT Art. XXIV 
Chile 01.08.99 Goods & Services  2001 GATT Art. XXIV & GATS Art. V 
Colombia 01.01.95 Goods & Services  2010 GATT Art. XXIV & GATS Art. V 
NAFTA 01.01.94 Goods 
Services 1993 
1995 GATT Art. XXIV 
GATS Art. V 
GSTP 19.04.89 Goods 1989 Enabling Clause 
LAIA 18.03.81 Goods 1982 Enabling Clause 
PTN 11.02.73 Goods 1971 Enabling Clause 
LAIA – Accession of Panama 03.05.12 Goods Not notified 
MERCOSUR [LAIA, AAP.CE N°55] c Goods  Not notified 
Bolivia [LAIA, AAP.CE N°66] 07.06.10 Goods & Services  Not notified 
Brazil [LAIA, AAP.CE N°53] 02.05.03 Goods Not notified 
Cuba [LAIA, AAP.CE N°51] 28.02.01 Goods Not notified 
LAIA – Cultural Goods [LAIA, 
AR.CEYC N°7] 09.08.90 Goods Not notified 
Ecuador [LAIA, AAP.R N°29] 14.12.87 Goods Not notified 
Argentina [LAIA, AAP.CE N°6] 01.01.87 Goods Not notified 
Paraguay [LAIA, AAP.R N°38] 01.07.84 Goods Not notified 
Panama [LAIA, AAP.A25TM N°14] 24.04.86 Goods Not notified 
LAIA- Preferences in favour of 
Bolivia n.a. Goods Not notified 
LAIA- Preferences in favour of 
Ecuador n.a. Goods Not notified 
LAIA- Preferences in favour of 
Paraguay n.a. Goods Not notified 
                                               
37 For additional information on the Pacific Alliance, see http://alianzapacifico.net/en/. WT/REG308/1 
 
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  Partner/ 
Agreement Date of 
entry 
into 
force Type of 
agreement GATT/WTO Notification 
Year WTO Provision 
PERU 
Costa Rica 01.06.13 Goods & Services  2013 GATT Art. XXIV & GATS Art. V 
European Union 01.03.13 Goods & Services  2013 GATT Art. XXIV & GATS Art. V 
Panama 01.05.12 Goods & Services  2012 GATT Art. XXIV & GATS Art. V 
Japan 01.03.12 Goods & Services  2012 GATT Art. XXIV & GATS Art. V 
Rep. of Korea 01.08.11 Goods & Services  2011 GATT Art. XXIV & GATS Art. V 
EFTA 01.07.11d Goods 2011 GATT Art. XXIV 
China 01.03.10 Goods & Services  2010 GATT Art. XXIV & GATS Art. V 
Singapore 01.08.09 Goods & Services  2009 GATT Art. XXIV & GATS Art. V 
Canada 01.08.09 Goods & Services  2009 GATT Art. XXIV & GATS Art. V 
Chile 01.03.09 Goods & Services  2011 GATT Art. XXIV & GATS Art. V 
United States 01.02.09 Goods & Services  2009 GATT Art. XXIV & GATS Art. V 
GSTP 19.04.89 Goods 1989 Enabling Clause 
Andean Community 25.05.88 Goods 1990 Enabling Clause 
LAIA 18.03.81 Goods 1982 Enabling Clause 
PTN 11.02.73 Goods 1971 Enabling Clause 
LAIA - Accession of Panama 03.05.12 Goods Not notified 
Thailand 31.12.11 Goods Not notified 
Andean Community 14.12.06 Services Not notified 
MERCOSUR [LAIA, AAP.CE N°58] 02.01.06e Goods & Services  Not notified 
Cuba [LAIA, AAP.CE N°50] 09.03.01 Goods Not notified 
LAIA - Seeds [AAP.AG N°2] 21.08.95 Goods Not notified 
 
a For those agreements negotiated under the LAIA  framework, the LAIA reference is included in 
brackets. Details of these agreements can be found at: http://www.aladi.org  
 "Partial scope" agreements are those RTAs no t providing for the establishment of a free trade 
area/customs unions and/or prov iding for a limited coverage. 
b For Mexico - El Salvador/Nicaragua: 01.09.12; for Mexico - Honduras: 01.01.13; for Mexico - Costa 
Rica: 01.07.13 and for Mexico - Guatemala: 01.09.13.  
c For Argentina, Brazil and Uruguay: 01.01.03; for Paraguay: 01.02.11. d For Peru – Switzerland/Liechtenstein: 01.07.11;  for Peru – Iceland:01.10.11; and for Peru – 
Norway: 01.07.12. 
e  For Peru – Argentina/Brazil/Uruguay: 02.01.06; For Peru-Paraguay: 06.02.06. 
LAIA: Latin American Integration Agreement 
EFTA: European Free Trade Association GSTP: Global System of Trade Preferences PTN: Protocol on Trade Negotiations NAFTA: North American Free Trade Agreement AAP.CE: Economic Complementarity Agreements. AAP.AG: Agreements under Article 12 of the Mo ntevideo Treaty on Agricultural Goods. 
 Source: WTO Secretariat.  
5.8  Intellectual property rights 
5.24.  In Chapter V dealing with the recognition and protection of denominations of origin, the 
Parties reaffirm their rights and obligations in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights. Beyond that: 
a. Peru recognizes the "Tequilla" denomination of origin for exclusive use of products 
originating from Mexico; and WT/REG308/1 
 
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  b. Mexico recognizes the "Pisco" denomination of origin for exclusive use of products 
originating from Peru. 
5.25.  Accordingly, the import, production or sale of the above-mentioned products are not 
authorized unless they have been manufactured and certified in the corresponding country, in 
accordance with its domestic laws and regulations. 
5.26.  The Parties may, by mutual agreement, grant protection to other denominations of origin 
upon notification of one of the Parties of new protected denominations under its national 
legislation. Protection will become effective within  a maximum of four months from the timing of 
notification. 
5.9  Others 5.27.  In Article 19.4, the Parties agree to start within one year from the Agreement's entry into 
force - i.e. by February 2013 - negotiations regarding government procurement
38 and trade 
facilitation and customs co-operation. In July 2013,  both Parties remained engaged in negotiation 
processes in two different fora - the Trans-Pacific Partnership (TPP) Agreement and the Pacific 
Alliance -39, which include a chapter each on government procurement. In that context, the Parties 
have stated that "their involvement in those processes began before February 2013, for this reason, the Parties deemed unnecessary to initia te a bilateral negotiation on the subject."  
 
                                               
38 Mexico and Peru are neither Members nor Ob servers to the WTO Agreement on Government 
Procurement. 
39 The TPP involved originally 11 countries, namely Br unei Darussalam, Canada, Chile, Malaysia, Mexico, 
New Zealand, Peru, Singapore, United States and Viet nam. Japan joined the talks in July 2013. The Pacific 
Alliance involves Chile, Colombia, Mexico and Peru. WT/REG308/1 
 
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 ANNEX 1 
1. A comparison between preferential tariff s applied under the scheduled elimination 
programmes of each Party and the MFN applied duties , by total, agricultural (WTO definition) and 
non-agricultural products, is shown in Tables A1.1 (Peru) and A1.2 (Mexico). Applied MFN duty 
rates in 2012 serve as a comparison. 
2. Table A1.1 provides a comparison between prefer ential tariff rates for Peru's imports from 
Mexico and MFN rates applied by Peru at the entr y into force of the Agreement. Peru's average 
applied MFN rate in 2012 was 3.2%. Average tariffs on agricultural products were 4.1% and 3.1% 
on non-agricultural products. In 2012, 55% of tariff lines were MFN duty free (34.8% for agriculture and 58.1% for non-agriculture). At th e date of entry into force of the Agreement 
(1 February 2012), Mexican exporters enjoyed an  absolute margin of preference of 2.2% vis-à-vis  
the prevailing MFN tariff, 1.4% for agricultural goods and 2.3% for non-agricultural products; by 
the end of implementation, 97.6% of the tariff is  expected to have been liberalized for imports 
from Mexico, of which 100% for non-agricultur al products and 81.9% for agriculture.  
Table A1.1. Peru: Indicators of MFN tariff rates and preferential rates for imports from 
Mexico 
Origin 
of 
goods Year ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share 
of 
duty-
free 
tariff 
lines 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) 
MFN 2012 3.2 7.2 55.0 4.1 6.4 34.8 3.1 7.4 58.1 
Mexico 2012 1.0 6.5 84.2 2.7 6.5 56.5 0.8 6.4 88.4 
 2013 1.0 6.5 84.2 2.6 6.6 56.9 0.8 6.4 88.4 
 2014 0.9 5.9 84.2 2.6 6.5 56.9 0.7 5.6 88.4 
 2015 0.7 4.8 84.2 2.5 6.2 56.9 0.5 4.1 88.4 
 2016 0.5 6.4 91.1 2.2 6.6 63.6 0.3 6.1 95.3 
 2017 0.5 5.6 91.1 2.1 6.4 63.6 0.2 4.9 95.3 
 2018 0.4 4.9 91.2 2.0 6.0 63.6 0.2 3.8 95.4 
 2019 0.3 3.9 91.2 1.7 5.2 63.6 0.1 2.5 95.4 
 2020 0.2 2.6 91.2 1.3 4.0 63.6 0.1 1.3 95.4 
 2021 0.1 6.4 97.6 0.9 6.4 81.9 0.0 11.0 100.0 
 
a WTO Definition. 
 Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines under Pe ru's price band system, only the ad valorem  part is included in 
the calculation of averages.  
 Based on the HS 2007 nomenclature.  Source: WTO estimates based on  data provided by Peru.  
 
3. Table A1.2 shows that Mexico's average app lied MFN rate in 2012 was 6.1%. Average tariffs 
on agricultural products were 20.2% and 4.6% on non-agricultural products. In 2012, 58.3% of tariff lines were MFN duty free (21.6% for agriculture and 62.3% for non-agriculture). At the date 
of entry into force of the Agreement, Peruvian ex porters enjoyed an absolute margin of preference 
of 3.6% vis-à-vis  the prevailing MFN tariff, 4.9% for agricultural goods and 3.5% for 
non-agricultural products; by the end of implem entation, 97.7% of the tariff will have been 
liberalized, 99.7% for non-agricultural prod ucts and 44.7% for agricultural products. WT/REG308/1 
 
- 49 - 
 
 Table A1.2. Mexico: Indicators of MFN tariff ra tes and preferential rates for imports from 
Peru 
Origin 
of 
goods Year ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Share of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff Share of 
duty-
free 
tariff 
lines 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) 
MFN 2012 6.1 14.8 58.3 20.2 25.8 21.6 4.6 12.3 62.3 
Peru 2012 2.5 19.0 86.6 15.3 28.4 45.4 1.1 12.7 91.1 
 2013 2.3 17.5 86.6 14.3 26.7 45.8 1.0 11.5 91.1 
 2014 2.0 15.6 86.7 13.3 24.8 45.8 0.8 9.6 91.1 
 2015 1.8 13.5 86.7 12.2 22.9 45.8 0.6 7.3 91.1 
 2016 1.5 18.1 91.5 11.2 25.0 54.1 0.4 10.2 95.6 
 2017 1.4 16.7 91.5 10.7 23.7 54.1 0.4 8.5 95.6 
 2018 1.2 15.4 91.7 10.1 22.9 54.8 0.3 6.9 95.7 
 2019 1.1 13.9 91.7 9.6 21.6 54.8 0.2 5.0 95.7 
 2020 1.0 12.3 91.7 9.0 20.4 54.8 0.1 3.0 95.7 
 2021 0.9 43.6 97.7 8.5 44.3 79.5 0.0 34.0 99.7 
 2022 0.9 43.6 97.7 8.5 44.3 79.5 0.0 34.0 99.7 
  2023 0.9 44.0 97.7 8.5 44.7 79.6 0.0 34.0 99.7 
 
a WTO Definition.  Note: For tariff lines subject to TRQs, only the out- of-quota duty is included in the tariff-related 
calculations; for the calculation of averag es, specific rates are excluded and the ad valorem  parts of 
alternate rates are included. 
 Based on the HS 2007 nomenclature.  Source: WTO estimates based on  data provided by Mexico. 
 
4. Mutual market access conditions for each country's top 25 exports in the 2009-2011 period 
are presented in Tables A1.3 and A1.4, together wi th an indication of the year in which duty-free 
treatment was to be granted. The code and product description are given at the HS six-digit level. 
The tables also show the number of tariff lines covered by the products concerned. 
5. Table A1.3 shows the market access conditions in Peru for Mexico's top 25 exports, covering 
100 tariff lines, which in 2011 accounted for 49.8% of its global exports. Seventeen products, 
accounting for around 33.1% of trade and covering  79 tariff lines, benefitt ed already from duty 
free treatment at the MFN level; the remaining ei ght products would become duty-free by 2021 at 
the latest. Liberalization from entry into force covered in full four extra products, and some lines of 
two other products. Products being liberalized in later years are automotive and refrigerators - though in that case liberalization will take place as of 2016. Only one agricultural product is within 
the top 25 exports - namely beer; this product is not subject to the Peruvian price-band system.  WT/REG308/1 
 
- 50 - 
 
 Table A1.3. Peru: Market access opportunities  under the agreement for Mexico's top 25 
exports 
Mexico's top export products in 2009-2011  Access Conditions to Peru's import 
markets 
MFN (2012) 
Duty-free in HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate (%) No. of 
tariff 
lines Duty-free  
Dutiable 
2012 
2016 
2018 
2021 
270900 Petroleum oils and oils obtained from bituminous minerals, 
crude. 12.7 0.0 1           
852872 Other colour reception apparatus for television, whether/not 
incorporating radio-broadcast receivers/sound/video 
recording/reproducing apparatus, 5.8 6.0   1 1       
870323 Vehicles (excl. of 87.02 & 8703.10) principally designed for the 
transport of persons, with spark-ignition internal combustion reciprocating piston engine, of a cylinder capacity >1500cc but not >3000cc 5.5
 6.0   4 1   3    
851712 Telephones for cellular networks/for other wireless networks, 
other than Line telephone sets with cordless handsets 3.1 0.0 1           
870431 Motor vehicles for the transport of goods (excl. of 8704.10), 
with spark-ignition internal combustion piston engine, g.v.w. not >5tonnes 2.2
 0.0 3           
710812 Gold (incl. gold plated with platinum), in unwrought forms (excl. 
powder) 1.8 0.0 1           
847149 Other automatic data processing machines , presented in the 
form of systems. 1.7 0.0 1           
851770 Parts of telephone sets, incl. telephones for cellular networks/for 
other wireless networks; other apparatus for the 
transmission/reception of voice, images/other data, incl. 
apparatus for communication in a wired/wireless network (such 
as a local/wide ar 1.4 0.0 1           
854430 Ignition wiring sets & othe r wiring sets of a kind used  in 
vehicles/aircraft/ships 1.3 6.0   1 1       
870120 Road tractors for semi-t railers (excl. of 87.09)  1.3 0.0 1           
271019 Petroleum oils & oils obtained from bituminous minerals (other 
than crude) & preparations not elsewhere specified/incld., containing by weight 70 %/more of petroleum oils/of oils obtained from bituminous minerals, these oils being the basic 
constituents of the preparations, other than waste oils and light 
oils & preparations 1.2
 0.0 28           
851762 Machines for the reception, conversion & 
transmission/regeneration of voice, images/other data, incl. 
switching & routing apparatus 1.1 0.0 3           
847150 Processing units other than those of sub-heading 
8471.41/8471.49, whether/not containing in the same housing one/two of the following types of unit : storage units, input units, output units 1.1
 0.0 1           
870829 Parts & accessories of bodies (incl. cabs) of the motor vehicles 
of 87.01-87.05, n.e.s. in 87.08 1.0 0.0 6           
870332 Vehicles principally designed for the transport of persons (excl. 
of 87.02 & 8703.10-8703.24), with C-I internal combustion piston engine (diesel/semi-diesel), of a cylinder capacity 
>1500cc but not >2500cc 1.0
 6.0   4     1  3 
940190 Parts of the seats of 94.01 1.0 6.0   2 2       
710691 Silver (incl. silver plated with gold/platinum), unwrought  1.0 0.0 2           
870899 Other parts & accessories for the motor vehicles of 87.01-87.05, 
exclud. 8708.91/92/93/94/95. 0.8 0.0 12           
841810 Combined refrigerato r-freezers, fitted with separate external 
doors, electric/other 0.7 11.0   4   4     
853710 Boards, panels, consoles, desks, cabinets & other bases, 
equipped with 2/more apparatus of 85.35/85.36, for electric 
control/distribution of electricity, incld. those incorporting 
instruments/apparatus of Ch. 90 & numerical control apparatus, 
other than switching apparatus of heading 85.17, for a voltage 
not >1000V  0.7 0.0 2           
870324 Vehicles (excl. of 87.02 & 8703.10) principally designed for the 
transport of persons, with spark-ignition internal combustion reciprocating piston engine, of a cylinder capacity >3000cc 0.7
 6.0   4 3     1 
870850 Drive-axles with differential, whether/not provided with other 
transmission components, and non-driving axles; parts thereof 
of the motor vehicles of headings 87.01 to 87.05. 0.7 0.0 4           WT/REG308/1 
 
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 Mexico's top export products in 2009-2011  Access Conditions to Peru's import 
markets 
MFN (2012) 
Duty-free in HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate (%) No. of 
tariff 
lines Duty-free  
Dutiable 
2012 
2016 
2018 
2021 
901890 Instruments and appliances used in medical/surgical/veterinary 
sciences, incl. other electro-medical apparatus & sight-testing instr., n.e.s. in 90.18 0.7
 0.0 2           
220300 Beer made from malt  0.7 6.0   1 1       
840991 Parts suitable for use solely/principally with spark-ignition 
internal combustion piston engines 0.6 0.0 10           
Total of above 49.8  79 21 9 4 4 4 
 
Note: Based on HS 2007 nomenclature.  Source: WTO estimates based on data provid ed by Peru and UNSD, Comtrade database. 
 
6. Table A1.4 shows the market access conditions in Mexico for Peru's top 25 exports, covering 
49 tariff lines, which in 2011 accounted for more than four-fifths of its global exports (80.9%). 
Fourteen products, and partially another product (petroleum, 2710.19), accounting for around 64.8% of trade and covering 30 tariff lines, be nefitted already from duty free treatment at the 
MFN level. Three products (5 lines and 4.2% of trade) will remain dutiable at the end of the 
transition period, while all the other seven products will be liberalized - four from entry into force, including the only tariff line of 2710.19 that wa s not MFN duty-free. All the remaining eight 
products would become duty-free by 2021 at the latest. Liberalization at from entry into force will 
cover in full four extra products, and some lines of two other products. All products being liberalized in the later years, or remaining dutiable, are agricultural products.  
Table A1.4. Mexico: Market access opportuniti es under the agreement for Peru's top 25 
exports
 
Peru's top export products in 2009-2011  Access Conditions to Mexico's 
import markets 
MFN (2012) 
Duty-free 
in 
Remain dutiable HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate (%) No. of 
tariff 
lines Duty-free 
Dutiable 
2012 
2016 
2021 
710812 Gold (incl. gold plated with platinum), in unwrought forms 
(excl. powder). 22.7 0.0 1         
260300 Copper ores & concentrates. 16.6 0.0 1      
740311 Cathodes & sections of cathodes, of refined copper, 
unwrought. 6.6 0.0 1         
230120 Flours, meals and pellets, of fish or of crustaceans, molluscs or 
other aquatic invertebrates. 4.5 15.0   1   1  
260700 Lead ores and concentrates. 3.7  0.0 1         
260800 Zinc ores and concentrates. 3.5 0.0 1      
271011 Light oils and preparations. 3.3  0.0 8         
271019 Petroleum oils and oils obtained from bituminous minerals 
(other than crude) and preparations not elsewhere 
specified/included., containing by weight 70 % or more of 
petroleum oils or of oils obtained from bituminous minerals, 
these oils being the basic constituents of the preparations, 
other than waste oil, light oils and preparations. 3.1 0.6 8 1 1    
090111 Coffee, not roasted, not decaffeinated. 2.8  20.0   2     2 
260111 Iron ores & concentrates (excl. roasted iron pyrites), non-
agglomerated. 1.6 0.0 1      
271111 Natural gas, liquefied.  1.5 0.0 1         
270900 Petroleum oils and oils obtained from bituminous minerals, 
crude. 1.3 0.0 2      
261390 Molybdenum ores and concentrates, other than roasted  1.2 0.0 1         WT/REG308/1 
 
- 52 - 
 
 Peru's top export products in 2009-2011  Access Conditions to Mexico's 
import markets 
MFN (2012) 
Duty-free 
in 
Remain dutiable HS number and description of the product  Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate (%) No. of 
tariff 
lines Duty-free 
Dutiable 
2012 
2016 
2021 
610910 T-shirts, singlets and other vests, knitted or crocheted, of 
cotton. 1.2 25.0   1 1    
261610 Silver ores & concentrates 1.0  0.0 1         
150420 Fats, oils and their fractions, of fish, other than liver oils, 
whether or not refined but not chemically modified. 0.8 10.0   2   2  
070920 Asparagus, fresh or chilled. 0.8  10.0   2     2 
740811 Copper wire, of refined copper of which the maximum cross-
sectional dim. exceeds 6mm. 0.7 5.0   2 2    
800110 Tin, not alloyed, unwrought. 0.6  0.0 1         
610510 Men's or boys' shirts, knitted or crocheted, of cotton.  0.6 25.0   2 2    
790111 Zinc, not alloyed, unwrought, containing by weight 99.99% or 
more of zinc. 0.6 0.0 1         
710691 Silver (incl. silver plated with gold or platinum), unwrought.  0.6 0.0 1      
080610 Grapes, fresh. 0.6  45.0   1     1 
200599 Vegetables and mixtures of vegetables (excl. of 2005.10-
2005.91), prepared or preserved other than by vinegar or 
acetic acid, not frozen, other than products of heading 20.06. 0.5 20.0   3  1 2  
030749 Cuttle fish (Sepia officinalis, Rossia macrosoma, Sepiola spp.) 
and squid (Ommastrephes spp., Loligo spp., Nototodarus spp., 
Sepioteuthis spp.), other than live, fresh or chilled. 0.5 20.0   2  1 1   
Total of above 80.9   30 19 6 2 6 5 
 
Note: Based on HS 2007 nomenclature.  Source: WTO estimates based on data provided  by Mexico and UNSD, Comtrade database. WT/REG308/1 
 
- 53 - 
 
  ANNEX 2 
Table A2.1 Peru: Products subject to the price band system 
HS Nomenclature Description MFN 
2012 Base 
Rate Category 
0401100000 
0401200000 Milk and cream 0 - Excluded 
0402101000, 0402109000, 
0402211100, 0402211900, 
0402219100, 0402219900 
0402291100, 0402291900 
0402299100, 0402299900 Powder milk 0 - Excluded  
0402991000 Condensed milk 0 - Excluded  
0404109000 Other whey 0 - Excluded  
0405100000 Butter 0  Excluded  
0405902000 Butteroil 0 - Excluded  
0405909000 Other  0  Excluded  
0406300000 Processed cheese 0 - Excluded  
0406904000, 0406905000 
0406906000, 0406909000 Other chesse 0 - Excluded  
1005901100 Yellow corn 0 12 F 
1005901200 White corn 0  17 F  
1005909000 Other corn 0 17 F 
1006109000 Other rice 0 - Excluded  
1006200000 Husked rice 0 - Excluded  
1006300000 Semi-milled or wholly milled rice 0 - Excluded  
1006400000 Broken rice 0 - Excluded  
1007009000 Other grain sorghum 0 - Excluded  
1103130000 Groats and meals of corn 0 17 C 
1108120000 Corn starch 6 17 C, tariff eliminated 
in 2021 
1108130000 Potato starch 6 - Excluded  
1701119000 Cane sugar 0 - Excluded  
1701120000 Beet sugar 0 - Excluded  
1701999000 Other cane and beet sugar 0 - Excluded  
1702302000 Glucose syrop 0 - Excluded  
1702600000 Other fructose and fructose syrup 0 - Excluded  
1702902000, 1702903000 
1702904000 Other 0 - Excluded  
1901902000 "Manjar blanco" and "dulce de 
leche" 0 17 F  
1901909000 Other food preparations of flour, 
groats, meal, starch or malt extract 0 17 C 
2106907900, 2106909000 Other food preparations 0  12 B  
2309909000 Other preparations of a kind used 
in animal feeding 0 12 B 
3505100000 Dextrins and other modified 
starches 6 17 B, tariff eliminated 
in 2016 
 Notes: For excluded products, the base ra te is not provided in the Agreement. 
 Tariff reductions made in accordance with the cate gory, starting from the base rate; if the TEP rate 
is higher than the corresponding MF N rate, than the MFN rate applies. 
 Source: Section 3 (Peru) of Annex to Article 3.4-A. WT/REG308/1 
 
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  ANNEX 3 
TARIFF-RATE QUOTAS AND PREFERENTIAL TARIFFS WITHIN THE AGREEMENT 
1. The preferential TRQs granted by Mexico to Peruvian imports, and by Peru to Mexican 
imports (products under category "F") are listed in Table A3.1 below. The TRQs are identical, with 
two exceptions as regards Peru: price-band system can be maintained for three products 
(evaporated milk,"dulce de leche" and corn),  and no TRQ is applied in preserved pepper.   
Table A3.1 TRQs provided for in the TEP by  Mexico and Peru in their Mutual Trade 
 In-quota 
rate Quota Out-of quota  
Evaporated milk and 
"dulce de leche" Duty-free 2,000 metric tonnes (MT), excluded from 
price band  Base rate and for Peru also 
the price-band system 
Beans Duty-free 2,000 MT in 2012, yearly increase of 500t 
to reach 4,000 tons as of 2016  Base rate 
Organic bananas, 
Cavendish variety Duty-free 2,000 MT  Base rate 
Avocado Duty-free 8,000 MT  Base rate 
Oranges Duty-free 1,650 MT in 2012, yearly increase of 150t 
to reach 3,000 MT as of 2021  Base rate 
Lemons and 
grapefruits Duty-free 1,100 MT in 2012, yearly increase of 100t 
to reach 2,000 MT as of 2021  Base rate 
Paprika Duty-free 4,000 MT in 2012, yearly increase of 
225MT to reach 4,900 MT as of 2016  Base rate 
Corn Duty-free 100,000 MT, excluded price band  Base rate and for Peru also 
the price-band system 
Cocoa beans Duty-free 1,000 MT  Base rate 
Cocoa paste, cocoa butter, fat and oil, cocoa powder Duty-free 2,000 MT  Base rate 
Dairy preparations Duty-free 2,662 MT in 2012, quantity increased 
yearly by 10% to reach 6,905 MT as of 
2022, then in 2023 the TRQ is unlimited  Progressively reduced from 
10% (M) and 12.5% (P) to 
duty-free in 2023 
Preserved pepper 
(Mexico only) Duty-free 1,000 MT  Base rate 
Shoes Duty-free 200,000 pairs In accordance with TEP 
 
Source: Sections 2 (Mexico) and 3 (P eru) of Annex to Article 3.4-A. 
 
2. The Agreement also provides for other products under category "F" the granting of 
preferential treatment, either eliminated within a transition period or falling short of full tariff 
elimination; the products and terms of these are presented in Table A3.2 below. Products benefiting from these are the same for both Mexi co and Peru; and the treatment involves either a 
seasonal preference or a margin of preference. In some cases, the preference is seasonal and only 
applies to a particular period of the year, for the rest of the year, the MFN rate apply. 
Table A3.2 Preferential Tariff Rates of Category "F" 
Product Preference Notes 
Mexico 
Swine meat 
0203.11.01 
0203.12.01 
0203.19.99 
0206.30.01 
0206.30.99  
Duty-free in 2013  
  
Eggs and derivatives  
0407.00.01& 
0407.00.02& 
0407.00.99& 
0408.11.01& 
0408.19.99&  
7 equal instalments, from 7.2% in 2012 to 
duty-free in 2018  
 
 
  WT/REG308/1 
 
- 55 - 
 
  Product Preference Notes 
0408.99.01& 
0408.99.02& 
0408.99.99 
 
0408.91.01& 
0408.91.99  
 
 
 
5 equal instalments, from 6% in 2012 to 
duty-free in 2016 
Onions 
0703.10.01 & 
0703.10.99 
 
0710.80.01 & 
0712.20.01  
5 equal instalments, from 8% in 2012 to 
duty-free in 2016  
5 equal instalments, from 16% in 2012 to 
duty-free in 2016  
Only from August to December 
Garlic Duty-free Only from November to January 
Asparagus Duty-free Only from September to December 
Potatoes 
0710.10.01  0712.90.03  
4 equal instalments, from 12% in 2012 to 7.5% in 2015 4 equal instalments, from 16% in 2012 to 10% in 2015  
Olives 
0711.20.01 5 equal instalments, from 12% in 2012 to 
duty-free in 2016  Only from May to September 
Mangoes and 
mangosteens 0804.50.01 & 0804.50.03 5 equal instalments, from 16% in 2012 to 
duty-free in 2016 Only from November to February 
Mandarins Duty-free Only from March to September 
Grapes 
0806.10.01 5 equal instalments, from 36% in 2012 to 
duty-free in 2016 Only from November to March 
Papaya  
0807.20.01 Margin of preference of 40% on the base 
rate (final tariff 12%)  
Ethyl alcohol  
2207.10.01 2207.20.01 Margin of preference of 28% on the base 
rate  
Peru 
Swine meat 
0203.11.00.00 
0203.12.00.00 
0203.19.00.00 
0206.30.00.00  
Duty-free in 2013  
  
Eggs and derivatives 
0407.00.90.00& 
0408.11.00.00& 
0408.19.00.00& 
0408.99.00.00 
 
0408.91.00.00 
 
 
3502.19.00.00  
7 equal instalments, from 7.2% in 2012 to 
duty-free in 2018  
 
 
 
5 equal instalments, from 6% in 2012 to 
duty-free in 2016 
 
Duty-free in 2013   
Onions 
0703.10.00.00 0712.20.00.00  
5 equal instalments, from 20% in 2012 to duty-free in 2016   
Only from February to June 
Garlic Duty-free Only from May to July 
Asparagus Duty-free Only from January to April 
Potatoes 
0710.10.00.00  
4 equal instalments, from 20% in 2012 to 
12.5% in 2015  
Olives 0711.20.00.00 5 equal instalments, from 16% in 2012 to 
duty-free in 2016  Only from August to December 
Mangoes and 
mangosteens 
0804.50.20.00 5 equal instalments, from 20% in 2012 to 
duty-free in 2016 Only from April to July 
Mandarins Duty-free Only from October to April 
Grapes 
0806.10.00.00 5 equal instalments, from 20% in 2012 to 
duty-free in 2016 Only from May to September WT/REG308/1 
 
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  Product Preference Notes 
Papaya  
0807.20.00.00 Margin of preference of 40% on the base 
rate   
Ethyl alcohol  
2207.10.00.00 
2207.20.00.10 
2207.20.00.90 Margin of preference of 28% on the base 
rate   
 
Source: Sections 2 (Mexico) and 3 (P eru) of Annex to Article 3.4-A. 
 
__________