WT/REG342/1/Rev.1  
26 June 2014  
(14-3689)  Page: 1/48  
Committee on Regional Trade Agreements   
 
 
 
 
 FACTUAL PRESENTATION 
FREE TRADE AGREEMENT BETWEEN  COSTA RICA AND PERU 
(GOODS AND SERVICES) 
Report by the Secretariat 
Revision 
This report, prepared for the considerat ion of the Free Trade Agreement between 
Costa Rica and Peru 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 52 44) or Alejandra Barajas Barbosa (tel: +41 22 739 64 25). 
 
 WT/REG342/1/Rev.1 
 
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 TABLE OF CONTENTS 
 
Page 
1   TRADE ENVIRONMENT ................................................................................................. 4  
1.1   Merchand ise trade ..................................................................................................... 4  
1.2   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............................................................................................ 13 
3.1.4   Tariff rate quotas ................................................................................................... 16 
3.2   Rules of origin .......................................................................................................... 16 
3.3   Export duties and charges,  and quantitative  restrictions ................................................. 18 
3.4   Regulatory provisions on trade in goods ....................................................................... 18 
3.4.1   Standards ............................................................................................................. 18 
3.4.2   Safeguard mechanisms ........................................................................................... 20 
3.4.3   Anti-dumping and countervailing measures ............................................................... 21 
3.4.4   Subsidie s and State-aid .......................................................................................... 21 
3.4.5   Customs-re lated procedures .................................................................................... 21 
3.4.6   Other regulations ................................................................................................... 23 
4   PROVISIONS ON TRADE IN SERVICES ....................................................................... 23  
4.1   Scope and definitions ................................................................................................ 23 
4.2   Denial of benefits ..................................................................................................... 25 
4.3   General provisions on trade in services ........................................................................ 25 
4.3.1   Mark et acce ss ....................................................................................................... 25 
4.3.2   National treatment and MFN .................................................................................... 25 
4.3.3   Commercial presence ............................................................................................. 26 
4.3.4   Movement of  natural persons .................................................................................. 26 
4.3.5   Performanc e requirements ...................................................................................... 27 
4.3.6   Senior management  and board of  direct ors ............................................................... 28 
4.4   Liberalization commitments ........................................................................................ 28 
4.4.1   Co sta Ri ca ............................................................................................................  28 
4.4.2   Peru .................................................................................................................. .. 31 
4.5   Regulatory provisions ................................................................................................ 34 
4.5.1   Domestic regulation ............................................................................................... 34 
4.5.2   Recognition ........................................................................................................... 35 
4.5.3   Subsidies .............................................................................................................. 35 
4.5.4   Safeguards ........................................................................................................... 35 WT/REG342/1/Rev.1 
 
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 4.5.5   Other investment -related pr ovisions ......................................................................... 35 
5   GENERAL PROVISIONS  OF THE AGREEMENT ............................................................. 35  
5.1   Tran sparency ........................................................................................................... 35 
5.2   Current payments and capital movements .................................................................... 36 
5.3   Exceptions ............................................................................................................... 36 
5.4   Accession and Withdrawal .......................................................................................... 37 
5.5   Institutio nal framework ............................................................................................. 37 
5.6   Disput e settlement ................................................................................................... 37 
5.7   Relationship with other agr eements concluded by the Parties .......................................... 40 
5.8   Government  procurement .......................................................................................... 41 
5.9   Intellectual property rights ......................................................................................... 42 
5.10   Competition policy .................................................................................................. 43 
ANNEX 1 ....................................................................................................................... . 44 
ANNEX 2 ....................................................................................................................... . 48 
 WT/REG342/1/Rev.1 
 
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Key Facts 
 
Parties to the Agreement:  Costa Rica and Peru 
 
Date of Signature:   26 May 2011 
 
Date of Entry into Force: 1 June 2013 
 
Date of Notification:  5 June 2013 
 
Full implementation :  1 January 2027 
 
 
1  TRADE ENVIRONMENT 
1.1.  The Free Trade Agreement between Costa Rica  and Peru (hereinafter "the Agreement") is 
Costa Rica's 10th and Peru's 16th RTA notified to the GATT/WTO; to a very large extent, these RTAs 
involve the same preferential partners. 
1.2.  In 2012, Costa Rica's GDP was US$45.15 billion while that of Peru was about more than four 
times that amount, at US$196.96 billion. Peru's per capita GDP, at US$6,567, was around two-
thirds that of Costa Rica. 
1.3.  Regarding trade in goods, Costa Rica ranks 61 in world exports and 59 in world imports 
(excluding intra-EU trade); for Peru, the ranks are 43 and 41, respectively. The trade of both 
countries represents a small share of world trade, with Peruvian exports representing the largest 
share (0.25%) and Costa Rica's imports the smallest (0,09%). As regards world trade in services, 
Costa Rica ranks 44th as regards exports and 82nd as regards imports; Peru in turn has a lower 
rank as regards exports - 48th - but a higher rank as regards imports - 46th.  
1.1  Merchandise trade 
1.4.  Chart 1.1 shows the evolution of trade during 2000-2012 of both Parties vis-à-vis the world 
as well as with regards to bilateral trade. Peru has constantly been a net exporter with respect to both bilateral and world trade; for Costa Rica, the opposite situation applies.
1 During the period 
concerned, the trade of both Costa Rica and Peru  has generally shown an upward trend, with the 
exception of 2001 and in particular of 2009, which saw a plunge in trade figures due to the world financial crisis. In 2009, only Peruvian exports to Costa Rica increased;
2 all other figures show a 
decrease in trade.  
                                               
1 Costa Rica has indicated that discrepancies rega rding trade figures can be explained by transfer 
pricing, namely differences regarding the valuation of exports and imports. 
2 In particular due to a considerable increase in exports of cotton apparel. WT/REG342/1/Rev.1 
 
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 Chart 1.1 Costa Rica and Peru: bilatera l and total merchandise trade, 2000-2012 
0.000.030.060.090.120.15
048121620
2000 2002 2004 2006 2008 2010 2012A. Costa Rica* 2000-2012
(US$ Billions)
Imports from Peru (Right Axis)
Exports to Peru (Right Axis)
Total Imports
Total Exports
0.000.030.060.090.120.15
01020304050
2000 2002 2004 2006 2008 2010 2012B. Peru 2000-2012 
(US$ Billions)
Imports from Costa Rica (Right Axis)
Exports to Costa Rica (Right Axis)
Total Imports
Total Exports
 
* Imports include flows from export processing zones. 
 
Note:  Data from Costa Rica excludes trade on products falling on chapter 98 of the HS 2007 classification. 
 Source: IMF - DOTS for Costa Rica  and UNDS Comtrade for Peru. 
 WT/REG342/1/Rev.1 
 
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 1.5.  The commodity structure of trade between the Part ies, as well as of their imports and exports 
for the last three representative years (all prior to the Agreement's entry into force) is shown inChart 1.2 on the basis of Harmonized System (H S) sections. While one of the three main imports 
of Costa Rica from Peru - chemicals - is also of importance as regards its global imports, the other 
two categories - plastics and prepared foods - do not match either Costa Rica's global imports nor 
Peru's global exports. For Peru, a different situation applies, with machinery being the main import category in bilateral and global terms (in the former case, accounting for almost half of the total 
bilateral imports) - and also the main export of Costa Rica towards the world. The other main 
products imported by Peru from Costa Rica incl ude plastics, optical and prepared food products.
 
Chart 1.2 Peru and Costa Rica: Product co mposition of merchandise trade, annual 
average (2010-2012) 
47
1110108663Peru's imports from Costa Rica (%)Total: US$44 million Total: US$17 billion
Total: US$ 37 billion Total: US$ 10 billionTotal:  US$ 42 billion
Total:  US$ 29 million
MiscellaneousAnimal 
products
Vegetables
Prepared 
FoodsChemicals
Plastics, 
rubberWood Pulp
Textiles
MachineryOpticalMinerals VehiclesPrecious stones
Articles of stoneBase metalsOther25
13
12 11655553224Costa Rica's imports from Peru (%) 
28
13
10 877544337Costa Rica's Global Imports (%)
41
221077527Peru's Global Exports (%)
25
15
11109744429Peru's Global Imports(%)
26
22
1296543227Costa Rica's Global Exports(%)
 
Costa Rican Authorities, UNDS Comtrade. 
 
1.2  Trade in services and investment 
1.6.  Tables 1.1A and 1.1.B below show th e breakdown of trade in commercial services vis-à-vis 
the world, as well as the Parties' data on foreign direct investment (FDI) for the period 2008-2012. Trade in commercial services of both Costa Rica and Peru has grown over the period, setting aside the year of 2009. Throughout this period, Costa Rica was a net exporter of commercial services, 
while Peru was a net importer. While figures on exports are comparable, Peru's services imports 
are around 3.5 times bigger than those of Costa Rica, and Peruvian imports of transportation 
services alone are higher than Costa Rica's total services imports. WT/REG342/1/Rev.1 
 
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 Table 1.1 Trade in commercial services  and investment with world, 2008-2012 
A. Costa Rica 
Unit: in million US$ 
Services Exports Imports 
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 
Total Services 4,083.3 3,592.9 4,320.0  4,988.2  5,501.0  1,882.4  1,404.8  1,782.7 1,780.3 2,012.5  
Transportation 
services 371.0 289.3 307.9 366.6 452.3 683.2 504.0 666.5 739.6 884.3 
Travel 2,282.9 1,815.0 1,998.7  2,152.3  2,299.3  593.5 367.3 423.6 405.3 428.8 
Communications 
services 39.2 45.2 41.5 28.8 25.3 109.7 100.0 99.3 84.5 81.5 
Construction .. .. .. .. .. .. .. .. .. .. 
Insurance services .. .. .. .. .. 148.7 119.1 131.3 141.4 155.4 
Financial services 13.9 16.4 25.7 28.6 33.6 11.7 9.6 18.0 21.3 32.1 
Computer and 
information services 683.5 758.2 1,216.5  1,571.1  1,855.4  6.1 11.6 21.6 30.4 29.9 
Royalties and 
licence fees 0.6 0.6 7.5 4.1 4.4 62.2 64.6 63.6 59.5 86.0 
Other business 
services 662.0 642.3 690.4 811.0 800.6 263.1 222.7 351.8 282.2 304.9 
Personal, cultural 
and recreational services 0.1 0.1 0.1 0.1 0.3 0.1 1.6 2.6 7.3 2.7 
Government 
services n.i.e. 30.2 26.0 31.7 25.5 29.9 4.1 4.2 4.4 8.8 7.1 
Investment Outward Inward 
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 
Total FDI stocks  531 545 649 1,106 1,570 10,878  12,386  14,066 16,201 18,713  
Total FDI flows 6 7 25 58 426 2,078 1,347 1,466 2,156 2,265 
.. Not available. 
 Source: Costa Rican auth orities, UnctadStat.  
 
Table 1.1 Trade in commercial services  and investment with world, 2008-2012 
B. Peru 
Unit: in million US$  
Services Exports Imports 
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 
Total Services 3,648.8 3,635.6 3,692.7  4,364.4  5,129.9  5,704.4  4,811.6  6,038.2 6,496.8 7,387.9  
Transportation 
services 818.3 757.7 854.1 996.6 1,222.7  2,559.7  1,737.1  2,453.2 2,517.4 2,852.4  
Travel 1,991.0 2,014.0 2,008.1  2,359.7  2,657.2  1,121.5  1,087.6  1,268.2 1,351.6 1,489.5  
Communications 
services 125.4 91.4 101.9 131.8 146.9 133.1 160.8 180.0 178.6 221.3 
Construction .. .. .. .. .. 155.8 48.6 56.1 114.7 42.2 
Insurance services 227.2 271.0 166.3 229.9 361.4 378.8 447.1 491.5 588.5 727.7 
Financial services 46.7 47.7 58.5 67.4 59.5 86.4 71.7 37.5 52.3 86.1 
Computer and 
information services 19.8 18.3 23.4 26.4 45.9 168.8 152.6 207.7 196.1 179.9 
Royalties and 
licence fees 1.5 2.2 3.1 5.4 11.5 159.5 152.4 196.8 215.8 229.5 
Other business 
services 280.4 293.3 333.3 398.8 469.1 783.8 789.7 978.0 1,107.7 1,378.4  
Personal, cultural 
and recreational services 3.9 3.4 3.9 5.3 10.0 19.1 17.8 19.1 21.0 23.8 
Government 
services n.i.e. 134.5 136.5 140.3 143.1 145.6 137.9 146.2 150.2 153.2 157.1 
Investment Outward Inward 
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 
Total FDI stocks  1,694 2,282 3,319 3,099 3,986 32,340  34,521  42,976 51,208 63,448  WT/REG342/1/Rev.1 
 
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 Services Exports Imports 
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 
Total FDI flows 736 411 266 113 57 6,924 6,431 8,455 8,233 12,240  
..  Not available. 
 Source: Banco Central de la Rese rva del Perú (BCRP), UnctadStat. 
 
1.7.  The tables above also show that world inward FDI stocks have constantly increased in both 
Parties. Costa Rica has seen inward flows of FDI being reduced only in 2009, while Peru has seen a 
more erratic situation – though by 2012 inward flows were almost twice those of 2008. Also of 
interest is the very high outward flows of FD I in 2012 for Costa Rica – which, at US$426 million, 
was 24 times the average of 2008-2011.3 Data included in Table 1.2 regarding the Parties' 
bilateral FDI show that their bilateral stocks and flows of FDI are negligible; during the period 
under consideration, only in one instance the bilateral FDI was above 1% - namely Costa Rica's flows of FDI to Peru in 2011 reached 1.4%. 
Table 1.2 Costa Rica and Peru: Bilateral Fo reign Direct Investment Flows and Stocks, 
2010-2012 
Unit: in million US$ 
Sector Costa Rica Peru 
Outward Inward Outward Inward 
2010  2011 2012 2010  2011  2012  2010  2011  2012 2010 2011  2012  
Total FDI Flows 0.0  0.8 1.3 3.213  3.928  6.361  0 0 0 0 0  0 
  Retail Trade .. .. .. 3.0 1.5 0.0 .. .. .. .. .. .. 
  Manufacturing ..  .. .. 0.2 0.0 0.3 .. .. .. .. .. .. 
  Real State .. .. .. 0.0 2.0 5.1 .. .. .. .. .. .. 
  Services ..  .. ..   1.0  .. .. .. .. .. .. 
  Tourism .. .. ..  0.4  .. .. .. .. .. .. 
Total FDI Stocks 0.0  1.0 2.3 5.4  7.9 14.4 .. .. .. 2.5 2.5  2.5 
Manufacturing .. .. .. .. .. .. .. .. .. 2.5 2.5 2.5 
Food products ..  .. .. .. .. .. .. .. .. 2.5 2.5  2.5 
..  Not available. 
Note:  FDI bilateral data from Peru was collected us ing PROINVERSION 's Fore ign Investment registry 
forms for firms/investors followin g the dispositions under Article 19 from the Legislative Decree  
 N° 662.  Source: Costa Rican Authorities,  PROINVERSION and UnctadStat. 
 
1.8.  Table 1.3 provides some information regard ing the movement of natural persons in the years 
2010-2012, including also tourists. Information regarding the movement of business persons is 
only available for Costa Rica 's nationals entering Peru. 
Table 1.3 Peru: Movement of natural persons, 2010-2012 
Migration 
category Peruvian' Nationals going to 
Costa Rica Costa Rican' nationals co ming from Costa Rica 
entering Peruvian territory 
2010 2011 2012 2010 2011 2012 
Business .. .. .. 301 311 228 
Work a .. .. .. 150 147 186 
Total b 14,789 13,472 13,356 8,298 9,219 9,034 
..  Not available. 
a Includes General workers, professional workers and contractual service suppliers.  
b Includes all types of travel purposes, such as tourism.   Source: Superintendencia Nacional de Migraciones del Perú.   
                                               
3 In particular due to a signif icant investment abroad  in the wholesale and retail trade sector. WT/REG342/1/Rev.1 
 
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 2  CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
2.1  Background Information 2.1.  In September 2010, negotiations aiming at the establishment of free trade agreements 
between Peru on one side, and, on the other side, Costa Rica, El Salvador, Honduras and Panama 
were launched; in November 2010, Guatemala joined in the negotiations. While negotiations were 
conducted jointly by all Parties, it was agreed that they would result in separate bilateral agreements. As of January 2014, agreements between Peru and Panama, Costa Rica and 
Guatemala had been signed, of wh ich the former two are in force.
4 The Free Trade Agreement 
between Costa Rica and Peru was signed on 26 Ma y 2011. Following the conclusion of ratification 
procedures by both countries,5 the Agreement entered into force on 1 June 2013.  
2.2.  The Agreement was notified to the WTO on 5 June 2013 under both Article XXIV of the 
GATT 1994 and Article V of the GATS as regards its goods and services aspects, respectively 
(WT/REG342/N/1 - S/C/N/696).  
2.3.  It consists of 19 Chapters, three Annexes and various Article-specific Annexes which form an 
integral part of the Agreement (see Box 2.1). 
Box 2.1 Structure of the Agreement 
Chapters, Sections & Annexes Title 
Preamble  
Chapter 1: Initial Provisions and General Definitions 
Section A Initial Provisions 
Section B General Definitions 
Chapter 2: Market Access of Goods 
Section A National Treatment  
Section B Tariff Elimination 
Section C Special Regimes 
Section D Non-Tariff Measures 
Section E Other Measures  
Section F Agriculture 
Section G Institutional Provisions 
Section H Definitions 
Chapter 3: Rules of Origin and Procedures of Origin 
Section A Rules of Origin 
Section B Procedures of Origin 
Chapter 4: Trade Facilitation and Customs Procedures  
Chapter 5: Cooperation and Mutual Assistance in Customs Issues  
Chapter 6: Sanitary and Phytosanitary Measures  
Chapter 7: Technical Barriers to Trade 
Chapter 8: Trade Defence 
Section A Bilateral Safeguard Measures  
Section B Global Safeguard Measures  
                                               
4 The Factual Presentation of the Free Trade Agreem ent between Peru and Panama has been circulated 
in WT/REG313/1/Rev.1. Guatemala has ratified its agreemen t with Peru in July 2013, but Peru's ratification is 
pending. 
5 The Agreement was ratified by Costa Rica on 22 April 2013 and by Peru on 26 March 2012. WT/REG342/1/Rev.1 
 
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 Chapters, Sections & Annexes Title 
Section C Anti-dumping and Countervailing Measures 
Section D Cooperation 
Chapter 9: Intellectual Property 
 Annex 9.4  Geographical Indications 
Chapter 10: Government Procurement 
 Annex 10.8.1  Procurement Documentation 
Chapter 11: Competition Policy 
Chapter 12: Investment 
Section A Substantive Obligations 
Section B Dispute Settlement Investor-State  
Section C Definitions 
Chapter 13: Cross-Border Trade in Services 
Chapter 14: Temporary Entry For Business Persons 
Chapter 15: Dispute Settlement 
Chapter 16: Transparency 
Chapter 17: Administration of the Agreement 
Chapter 18: Exceptions 
Chapter 19: Final Provisions 
  
Annex I Non-conforming measures (Costa Rica and Peru) 
Annex II Non-conforming measures (future measures, Costa Rica and Peru) 
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 Agreement establishes a free trade area to be formed within a maximum transition 
period of 13 years and 7 months; the last instalment will take place on 1 January 2027. The first 
tariff reduction took place on 1 June 2013; future reductions will take place on 1 January of each 
year from the base rate. The base rate is the MFN rate applied as of 30 June 2010, except for 160 tariff lines on which Peru considers the MFN rate applied as of 1 January 2008. 
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 
Agreement's provisions take precedence. The Part ies are to ensure that all necessary measures 
are adopted to ensure the Agreement's application by all levels of government. 
3.3.  National treatment on trade in goods applies (Article 2.2) except with respect to import or 
export restrictions allowed under Article 2.8 and Annex 2.2 (see paragraphs 3.8 below).  
3.4.  The main disciplines regarding tariff liberalization (Article 2.3) are twofold: WT/REG342/1/Rev.1 
 
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 a. For products included in the Tariff Elimination Programme (TEP), the liberalization 
programme is included in Annex 2.3 and in the Parties' individual lists;6 and 
b. A standstill commitment for all products (including those not covered by the TEP 
(Article 2.3), except that a Party may: 
i. increase its tariff up to the level foreseen in the TEP following an unilateral reduction; 
or 
ii. maintain or increase the tariff if au thorized under a WTO dispute settlement. 
3.5.  Besides, consultations aiming at improving the TEP may be launched upon a Party's request. 
3.6.  Further, the Agreement explicitly authorizes Peru to maintain specific duties resulting from its 
price-band system ("Sistema Peruano de Franjas de Precios, SPFP") for certain basic foodstuffs (paragraph 9 of Annex 2.3), as identified in Peru's list (see paragraph 3.16.   below). 
3.7.  No automatic rendezvous clause is provided for with respect to trade liberalization. However, 
upon a Party's request, consultations will take pl ace regarding acceleration of the TEP; if agreed, 
the new tariff will apply once it is legally approved by the Parties.  
3.8.  Article 2.8 includes a general prohibition on restrictions on imports from the Parties, including 
quantitative restrictions (QRs);
7 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;8 
c. price undertakings agreed in the context of dumping and subsidies proceedings; 
d. measures listed in Annex 2.2:  
i. for Costa Rica, import controls on crude oil and derivatives and ethanol and crude 
rums; 
ii. for Peru, import controls on worn clothes and shoes, used vehicles and engines 
(including part of the vehicles), retreaded tyres, used goods and machinery and 
equipment using radioactive energy. 
3.9.  The Agreement prohibits the Parties from subj ecting an authorization to import, to any type 
of relation with a domestic distributor. 
3.10.  Article 2.9 incorporates in the Agreement the WTO Agreement on Import Licensing 
Procedures. Additional transparency disciplines ar e to notify: (i) at the Agreement's entry into 
force existing import licensing procedures; (ii) new procedures or changes to existing ones at least 
60 days prior to their entry into force;9 in the absence of such notifications, the licensing scheme 
cannot be applied. 
3.11.  In accordance with Article 2.10, the Parties reaffirm the rights and obligations of Article VIII 
of the GATT 1994. They also agree to a mutu al exemption of consular transactions or 
requirements, including fees and charges connected with importation, on imports from the other Party. They are to make available through the In ternet information on fees and charges imposed 
in relation to importation and exportation.  
                                               
6 The TEP does not apply to used goods, but applie s to recycled goods (footnote 1 to Article 2.3, 
paragraph 3). 
7 The Article also prohibits export rest rictions, as explained in Section 3.3. 
8 The relevance of Article XI is to be seen in light of  stricter disciplines in force since the entry into force 
of GATT 1994. 
9 The WTO Agreement requires notification 60 days after publication. WT/REG342/1/Rev.1 
 
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 3.12.  Articles 2.4-2.7 deal with special customs regimes, including temporary entry of goods. 
Article 2.4 prohibits new, or increases in existing, tariff exemptions if these are based on compliance with performance requirements, as we ll as its maintenance in mutual trade.  
3.13.  A Committee on Trade in Goods is established as per Article 2.16. 
3.1.2  Liberalization of trade and tariff lines 
3.14.  As noted earlier, the TEP provides for the ca lendar of mutual tariff dismantling, as follows: 
a. seven categories - A, B3, B5, B7, B10, B 12 and B15 - provide for tariff elimination, 
either immediately or gradually (in equal inst alments), with a maximu m transition period 
of 13 years and 7 months; 
b. category C - which only applies to 44 tariff lines for Peru - also provides for tariff 
elimination, but with specific staged reductions up to a maximum of 15 instalments. 
Reductions were originally foreseen in to start in 2011; given that the Agreement only 
entered into force in 2013, the reductions foreseen for 2011 and 2012 were skipped, with the 2013 rate being that originally foreseen; 
c. for products under category D, no tariff elimination is scheduled but TRQs are provided 
(see Section 3.1.4  );  
d. finally, category E involves products exclud ed from liberalization and for which the MFN 
rate applies. 
3.15.  Costa Rica's liberalization under the Agreement is depicted in Table 3.1.A below. A 
significant change in market access is provided from the Agreement's entry into force, with duty-free tariffs increasing to three-quarters of its tariff lines and 62.9% of its imports from Peru 
(on the basis of 2010-2012 import average), from 2.2% and 0.2% respectively on an MFN basis 
prior to that date. The second biggest liberalization  will take place 10 years from entry into force; 
by the end of the transition period, 1.4 % of its tariff lines accounting for 4.9% of imports will 
remain dutiable.  
Table 3.1 Tariff elimination commitments under the Agreement and corresponding 
average trade 
A. Costa Rica 
Duty phase-out 
period Number of lines % of total lines in 
Costa Rica's tariff 
schedule Value of Costa Rica's 
imports from Peru 
(2010-2012) in 
million US$ % of Costa Rica's 
total imports from 
Peru 
(2010-2012) 
MFN Duty Free 
(2013) 142 2.2 0.1 0.2 
2013 4,968 75.7 27.8 62.9 
2017 235 3.6 7.6 17.2 
2022 825 12.6 3.5 7.8 
2024 132 2.0 0.6 1.2 
2027 173 2.6 2.5 5.7 
Remain dutiable 91 1.4 2.2 4.9 
Total 6,566 100.0 44.1 100.0 
 
Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations.  
 Based on the HS 2007 nomenclature.  Source: WTO estimates based on data provid ed by Costa Rica and WTO-IDB Database.  
 
3.16.  Peru's liberalization is portrayed in Table 3.1.B below; its starting point was distinct from 
that of Costa Rica, as more than half of its lines, accounting for around three-quarters of 2010-2012 imports, were already duty-free on an MFN basis prior to the Agreement's entry into force. 
From that date on, these figures will increase to 83.6% and 88.3%, respectively. Gradual tariff WT/REG342/1/Rev.1 
 
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 elimination will continue, with th e second larger liberalization taking place in 2022, ten years after 
entry into force. At the end of the transition peri od, 87 tariff lines, accounting for 1.2% of the total 
and 0.5% of imports will remain dutiable; out of these, 47 lines are those subject to the 
price-band system. The system applies with respec t to basic foodstuff totalling 47 tariff lines, 
including certain dairy products, corn, rice and sugar. Out of these 47 lines, 25 are fully excluded 
from liberalization, for 19 only the ad valorem  component is eliminated - either at entry into force 
or within varying transition periods - while for the remaining 3 lines TRQs are provided.10 The 
other 40 lines remaining dutiable relate to either  products excluded from the TEP or those under 
category "D" providing for TRQs (bovine meat).  
Table 3.1 Tariff elimination commitments under the Agreement and corresponding 
average trade 
B. Peru 
Duty phase-out 
period Number of lines % of total lines in 
Peru's tariff 
schedule Value of Peru's 
imports from  
Costa Rica (2010-
2012) in million US$ % of Peru's total 
imports from  
Costa Rica 
(2010-2012) 
MFN Duty Free 
(2013) 4,054 55.0 21.8 74.3 
2013 2,108 28.6 4.1 14.0 
2015 1 0.0 1.3 4.4 
2016 1 0.0 0.0 0.0 
2017 450 6.1 1.6 5.5 
2018 2 0.0 0.0 0.0 
2019 2 0.0 0.0 0.0 
2022 525 7.1 0.2 0.6 
2023 1 0.0 0.0 0.0 
2024 50 0.7 0.0 0.1 
2025 3 0.0 0.0 0.0 
2027 86 1.2 0.2 0.7 
Remain dutiable 87 1.2 0.2 0.5 
Total 7,370 100.0 29.4 100.0 
 
Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines subject to the 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 prov ided by Peru and WTO-IDB Database.  
 
3.1.3  Liberalization schedule 
3.1.3.1  Costa Rica 
3.17.  Table 3.2 illustrates Costa Rica's liberalization vis-à-vis  Peru's imports by HS Section. The 
majority of products remaining dutiable are agricultural (WTO definition); these have also the highest final average tariffs, up to 47.4%, also combined with the absence of any duty-free line 
prior to entry into force. Products excluded from liberalization are presented in terms of 
HS Chapters in Chart 3.1, which also shows the average MFN and preferential tariffs for lines remaining subject to duty. Beef, dairy, coffee, rice, potatoes, beans, sugar and beer are among 
the excluded agricultural products; as for industri al products, these include plastic articles, paper 
labels, ceramic sanitary and fixtures, iron angles, iron or steel pipes, and aluminium bars and structures. Out of the 19 Chapters containing excl uded products, only beverages (Chapter 22) has 
an average preferential tariff differing from the MFN rate.  
                                               
10 At the time of entry into force of the Agreement,  44 out of these 47 tariff lines were MFN duty-free. WT/REG342/1/Rev.1 
 
- 14 - 
 
 Table 3.2 Costa Rica: Tariff elimination under the Agreement, by HS section HS 
Section MFN 
average 
% Total 
No. of 
lines MFN 
duty-free 
(2013) Number of duty-free lines under the 
Agreement No. of lines 
remaining 
dutiable Avg. Final 
Tariff 
(Dutiable)  
% 2013 
2017 
2022 
2024 
2027 
I 20.7 299 145 4 96 5 6 43 47.4 
II 9.5 376 303 11 36 3 23 27.5 
III 8.9 54 20 7 3 7 17 
IV 13.9 274 121 42 51 6 45 9 33.6 
V 3.4 178 10 158 5 5 
VI 2.8 962 2 840 17 103 
VII 5.1 335 184 21 84 42 4 11.3 
VIII 8.8 108 47 41 20 
IX 8.8 138 26 13 99 
X 5.6 294 208 22 44 18 1 1 15.0 
XI 9.9 920 901 3 16 
XII 12.8 64 47 9 8 
XIII 7.0 176 87 2 56 4 21 6 11.7 
XIV 7.5 54 54 
XV 3.9 697 474 13 106 74 25 5 13.0 
XVI 2.8 974 116 774 15 51 8 10 
XVII 5.8 234 2 231 1 
XVIII 4.6 237 12 225 
XIX 15.0 21 21 
XX 10.9 162 114 10 25 10 3 
XXI 8.2 9 9 
Total 6.8 6,566 142 4,968  235 825 132 173 91 40.7 
 
Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations.  
 Based on the HS 2007 nomenclature. 
 
Source: WTO estimates based on data provid ed by Costa Rica and WTO-IDB Database.  
 
3.1.3.2  Peru 
3.18.  Table 3.3 illustrates Peru's liberalization vis-à-vis  Costa Rica's imports by HS Section. As 
regards products remaining dutiable, only six are non-agricultural (WTO definition)11 - plastic 
articles, paper labels and glass bottles for packing, all of which have a tariff of 6%. For agricultural 
products, the highest average rate is 8.1% for HS Section I. By the end of the transition period, 
7.7% of agricultural lines will remain subject to restrictions; the average tariff rate ranges from 
duty-free (but subject to a price-band system) to 8.1%. HS Chapters remaining dutiable are 
shown in Chart 3.1; the average MFN and preferenti al tariffs are the same with the exception of 
wheat and maize starch in Chapter 11, for which the 6% MFN rate is eliminated at entry into force. 
The highest rate of 8.9% applies to coffee, tea, mate and spices in Chapter 9. 
Table 3.3 Peru: Tariff elimination un der the Agreement, by HS section HS 
Section MFN 
average 
% Total 
No. of 
lines MFN 
duty-
free 
2013 Number of duty-free lines under the 
Agreement No. of 
lines 
remain 
dutiable Avg. 
Final 
Tariff 
% 2013 
2015 
2016 
2017 
2018 
2019 
2022 
2023 
2024 
2025 
2027 
I 2.3 308 185 71   1  1 2    2 1    1  3 41 8.1 
II 4.4 384 121 210     8   1 17       3 24 7.5 
III 2.6 64 36 13     2     3   2   8     
IV 3.8 301 113 82     55     20     2 14 15 6.0 
V 1.8 214 151 41     22                   
VI 2.0 1465 970 310 1   90   1 92         1 SPFP+ 
0.0*  
                                               
11 Products remaining dutiable of HS VI refer to dext rins of HS 3505, classified as agricultural products 
as per the WTO definition. The dextrins have 6% ad valorem  tariff and the tariff line 3505.10.00.00 is subject 
to the price band system. WT/REG342/1/Rev.1 
 
- 15 - 
 
 
 
HS 
Section MFN 
average 
% Total 
No. of 
lines MFN 
duty-
free 
2013 Number of duty-free lines under the 
Agreement No. of 
lines 
remain 
dutiable Avg. 
Final 
Tariff 
% 2013 
2015 
2016 
2017 
2018 
2019 
2022 
2023 
2024 
2025 
2027 
VII 2.2 312 196 9     22     59       23 3 6.0 
VIII 5.3 79 9 17     31     22             
IX 4.4 107 28 8     39     32             
X 3.7 246 93 29     75     32   15   1 1 6.0 
XI 9.2 966 63 883     3     17             
XII 8.8 56   40     8     8             
XIII 2.3 174 106 8     17     27   2   12 2 6.0 
XIV 3.5 57 24 33                         
XV 1.0 700 581 29     33     29   21   7     
XVI 1.1 1,195 991 128     17     45   1   13     
XVII 1.2 226 181 2     5     38             
XVIII 2.4 290 175 115                         
XIX 6.0 69               69             
XX 4.8 150 31 73     22     13   9   2     
XXI 6.0 7   7                         
Total 3.2 7,370 4,054 2,108 1 1 450 2 2 525 1 50 3 86 87 7.5 
*  The remaining dutiable line for section VI is subj ect to the price band system, SPFP. At the end of the 
implementation period, only its ad-valorem component will be liberalized. 
 Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines subject to the 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 prov ided by Peru and WTO-IDB Database.  
 
Chart 3.1 Costa Rica and Peru: Average of dutiable rates, by HS Chapter 
010203040506070
02 04 07 09 10 11 17 19 21 22 23 39 48 69 70 72 73 76a. Costa Rica
(HS 01-97)
MFN
Preferential
012345678910
02 *04 07 09 *10 *11 *17 *19 21 22 *23 *35 39 48 70b. Peru
(HS 01-97)
MFN
Preferential
 
* Subject to price band, with an ad-valorem fix component of 0%. 
 Note: For tariff lines subject to TRQs, only the out-of-quota duty is included in the tariff-related 
calculations; for tariff lines subject to the 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 provid ed by Costa Rica and Peru, and WTO-IDB. 
 WT/REG342/1/Rev.1 
 
- 16 - 
 
 3.1.4  Tariff rate quotas 
3.19.  Both Parties provide a number of tariff-rate qu otas (TRQs) for agricultural products (12 tariff 
lines for Peru and 6 for Costa Rica); their implementation and administration is in accordance with Article XIII of the GATT 1994 and the WTO Import  Licensing Agreement (Appendix 1 to Annex 2.3 
provides all the details; Annex 2 of this document provides the details of the TRQs). In particular, 
it specifies that only government authorities can administer the quotas, that no quota allocation can be made on a group-specific basis nor contingent on the purchase of domestic production or 
on the re-exportation of an agricultural product. 
3.20.  Under category D, both Parties provide TRQs on bovine meat, while Peru also provides TRQs 
for dairy products and food complement. These TRQs provide minimum access, but no tariff 
elimination is provided for at the end of the transition period. None of these products were traded 
between the Parties during 2010-2012. 
3.2  Rules of origin 3.21.  Rules of origin are set out in Section A of  Chapter 3. The basic requirements for a good to 
be considered originating, as in Article 3.1, are: 
a. the good is wholly obtained or produced entirely in the territory of one or both Parties; 
b. the good is produced entirely in the territory of one or both Parties from originating 
materials only; or 
c. the good is produced entirely in the territory of one or both Parties by using 
non-originating materials which comply with the specific rules of origin contained in Annex 3, as follows: 
i. it goes through a change in tariff classification (CTC), or 
ii. in much fewer cases, it meets a minimum regional value content (RVC) benchmark, 
iii. in very few cases, it goes through a CTC and meets requirements concerning a 
minimum RVC, or 
iv. for Chapters 27-29, as well as for some  apparel of Chapters 61-63, specific 
processing requirements are fulfilled, and  
d. in any of these cases, the good meets all other applicable criteria contained in Chapter 3. 
3.22.  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 chapter and subheading levels are also frequent (the former in particular for agricultural and 
mineral products). Article 3.4 provides a list of minimal operations that do not confer origin. 
3.23.  A "softer" rule of origin - allowing the use of non-originating mechanically de-boned fowl 
meat - apply for imports up to a 100 metric tonnes of sausages, food preparations and other 
prepared or preserved meat of HS 1601 and 1602; imports above this quantity are subject to the 
normal, stricter rule. In the case of Costa Rica , MFN 2013 rates for these products vary from 14% 
to 150%, with liberalization to be complete either within 10 or 15 years, except prepared or 
preserved meat and offal of poultry other than fo wls, which are duty-free as from the Agreement's 
entry into force. For Peru, MFN 2013 rates for these products vary from 6% to 11%, with liberalization expected either within 10 or 15 ye ars, except prepared or preserved meat and offal 
of poultry other than fowls, which are duty-free as from the Agreement's entry into force. During 
2010-2012, no bilateral imports of these products were recorded.  
3.24.  In the case of sets or assortments (Article 3.10), each part of the set has to fulfil the origin 
requirements. According to the tolerance rule, a set or assortment will be considered originating if 
the value of all non-originating elements do es not exceed 15% of its f.o.b. value.  WT/REG342/1/Rev.1 
 
- 17 - 
 
 
 3.25.  No outward processing is authorized, and direct transport is required. Transit through 
non-Parties is authorized, with or without transhipment or temporary storage, only if the goods remain under the surveillance of the customs auth orities 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 3.14); proof of compliance with those requirements is 
required, as stipulated in the Article. 
3.26.  Article 3.3 provides that the RVC is the difference between the fob value of the good and 
the c.i.f. value of the non-originating materials divided by the fob value multiplied by 100.
12 The 
RVC threshold is 50%; very few exceptions apply, so that originating status is granted for tea, electric ovens, seats and toys and games if they comply with an RVC of 40%; and for some domestic appliances if they comply with an RVC of 45%.  
3.27.  While the rules of origin include a provision for intermediate materials - so that 
non-originating materials included in an intermediate material are not taken into account in the determination of origin of the final good (Article 3.5), thus benefitting vertical integrated 
producers, the absorption principle - disregar ding the value of non-originating materials 
incorporated in another good that has acquired originating status - is not provided for.  
3.28.  Bilateral cumulation applies between the two Parties (Article 3.6). Diagonal cumulation 
applies as follows: 
a. cumulation with El Salvador, Guatemala, Honduras or Panama is allowed under the 
following circumstances: 
i. a trade agreement is in force between Peru and the above-mentioned countries, and 
the corresponding rules of origin are fulfilled according to this Agreement;
13 
ii. the material being cumulated is not excluded from the tariff liberalization programme 
under the agreement between the importing Party and the cumulating Party; 
iii. for textiles in HS 50-63, diagonal cumulation only applies if the both the material and 
the good are duty-free under the Agreement and all other agreements between the importing Party and the beneficiary of this extended cumulation;  
b. subject to negotiations of other conditions that each Party may deem necessary for its 
application, cumulation could be also extend ed to goods/materials from countries/group 
of countries with whom both Parties have a "preferential trade agreement".
14 This 
includes in particular the negotiation of equivalent provisions.  
3.29.  A de minimis  rule (Article 3.7) 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 fob value. As regards textiles in HS Chapters 50 to 63, de minimis  is modified so that if the good is 
non-originating because the fibres and yarns us ed 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. 
3.30.  Chapter 3 provides for the creation of a Committee on Rules of Origin (Article 3.33).  
                                               
12 Valuation of goods is done on the basis of the WT O Agreement on Implementation of Article VII of the 
GATT 1994. 
13 As of January 2014, the only other agreement in fo rce was that with Panama. See paragraph 2.1.   
14 The list of RTAs in force for Costa Rica  and Peru can be found in Section 5.7.  WT/REG342/1/Rev.1 
 
- 18 - 
 
 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: threshold is 50%. 
 Bilateral cumulation; diagonal cumulation under certain conditions. 
 Tolerance rules. 
 Direct transport and no outward-processing authorized. 
 
3.3  Export duties and charges,  and quantitative restrictions 
3.31.  Article 2.8 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 2.2 - i.e. controls imposed by Costa Rica on exports of wood in 
logs and boards, hydrocarbons, coffee, et hanol and crude rums, and minimum export 
price for bananas; and 
e. restrictions authorized by the WTO Dispute Settlement Body. 
3.32.  Article 2.9 provides that a Party is to notify in due time the other Party of the establishment 
of export licensing procedures. 
3.33.  Article 2.11 imposes a general prohibitio n on export taxes and charges connected to 
exports, with the exception of Costa Rica's export  taxes on bananas, coffee and meat (included in 
Annex 2.11). 
3.4  Regulatory provisions on trade in goods 
3.4.1  Standards 3.4.1.1  Sanitary and phytosanitary measures 3.34.  Through Chapter 6, the Parties reaffirm th e rights and obligations of the WTO Agreement on 
Sanitary and Phytosanitary (SPS) Measures (Article 6.3) and engage themselves to further its 
implementation.  
3.35.  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 trade nor create unnecessary obstacles to trade. 
3.36.  Article 6.5 promotes the equivalence of sani tary standards, and provide that the Parties are 
to define within the SPS Committee mechanisms for evaluating and accepting SPS measures as equivalent. [As of March 2014, the SPS Committee had not addressed the equivalency of SPS 
measures. Article 6.6 provides that SPS measures applied by a Party are based on an adequate 
risk-assessment taking into account international regulations, principles or recommendations. 
These will also guide the Parties in taking measures to facilitate the evaluation of SPS services, whenever such a request is made. Building on  the WTO SPS Agreement, Article 6.7 provides 
inter alia  that the SPS Committee is to develop appropriate procedures to grant recognition of 
pest- or disease-free areas and areas of low pest or disease prevalence.  WT/REG342/1/Rev.1 
 
- 19 - 
 
 
 3.37.  Transparency provisions are contained in Article 6.9. The Parties must inform each other 
about the adoption or application of SPS measur es in accordance with the WTO SPS Agreement. 
Besides, notification is also due with respect to: 
a. emergency measures or their modification are to be notified within 3 days, in accordance 
with Annex B of the WTO SPS Agreement;  
b. a sanitary alert with respect to control of food traded between the Parties, whenever a 
risk exists in relation to human health protection; 
c. non-compliance detected vis-à-vis  certification of export products subject to SPS 
measures; 
d. exotic or unusual cases of pests or diseases; and 
e. upon request by a Party, updated information on import requirements - applied or being 
developed - for specific products under the SPS Agreement. 
3.38.  A "Committee on SPS Measures" is established under Article 6.11, which details its 
functions. Any dispute shall be first referred to the Committee; only if a solution cannot be found 
in the Committee can the dispute be subject to the dispute settlement mechanism of Chapter 15. 
3.4.1.2  Technical barriers to trade 3.39.  Chapter 7 applies with respect to the prep aration, adoption and application of technical 
barriers to trade (TBT), defined to include standards, technical regulations and conformity 
assessment procedures, including those relating to metrology, that may affect, directly or indirectly, trade in goods between the Parties; it does not apply to SPS measures nor to government procurement. The WTO's TBT Agreem ent is incorporated into the Agreement, 
mutatis  mutandis  (Article 7.3).  
3.40.  International standards shall generally be used as a basis for the Party's domestic standards 
and conformity assessment procedures (Article 8. 4). Cooperation between the Parties' domestic 
standardization bodies is encouraged. 
3.41.  In the Agreement, TBT is also dealt with fr om a trade facilitation angle. Beyond highlighting 
some areas of work, Article 7.4 states that in cases where imports from the other Party have been 
blocked at an entry point due to non-compliance with a technical regulation, the importer shall be 
immediately notified of the reasons of such blockage.  
3.42.  The TBT Chapter aims at encouraging recognition and equivalence of technical regulations 
and/or conformity assessment procedures, as well as the conclusion of mutual recognition 
agreements. In cases where the former are not pr ovided, or if there is a refusal to initiate 
negotiations on the latter, the Party shall, upon request by the other Party, explain the reasons for that refusal (Articles 7.6 and 7.7). The applicat ion of national treatment for accreditation, 
authorization or recognition of conformity assessment entities in the territory of the other Party is 
reaffirmed; any deviation from that principle shall also be duly justified upon request by the other 
Party. 
3.43.  Transparency provisions are contained in Article 7.8 and provide for the electronic 
transmission of notifications regarding projects of technical regulations and conformity assessment 
procedures at the time these are notified to the WTO's Central Registry of Notifications. Notification 60 days prior to publication (as in the WTO) is required for any proposals to adopt new 
technical regulations and conformity assessment procedures. Technical regulations and conformity 
assessment procedures with a technical content that conform with international regulations, principles and recommendations are to be made available on the website of the competent 
national authority. The Parties agreed on an interval of six months between publication and entry 
into force of technical regulations and conformity assessment procedures (exceptions may WT/REG342/1/Rev.1 
 
- 20 - 
 
 apply).15 The disciplines on transparency are to be  implemented within three years, i.e. by 
June 2016. 
3.44.  Technical assistance measures are contained in Article 7.9. Article 7.10 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. 
3.45.  Information to be supplied upon the request of a Party is to be provided in a printed or 
electronic format within 30 days from the request. Otherwise, the exchange of information is to be 
in accordance with the recommendations of the WTO TBT Committee.16 
3.4.2  Safeguard mechanisms 3.46.  Chapter 8 on trade remedies authorizes th e use of bilateral and global 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 pr ohibited (Article 8.8:3). Beyond that, a general 
balance-of-payments (BOP) safeguard clause is also  provided for; see paragraph 4.63.   below. 
Section D (Article 8.10) establishes a cooperation mechanism between the Parties' investigating 
authorities relating to all trade defence measures  (safeguards, anti-dumping and countervailing 
measures).   
3.47.  As of March 2014, no safeguard measure has been imposed between the Parties. 
3.4.2.1  Global safeguards 3.48.  Section B of Chapter 8 addresses global safeguard measures (Article 8.8). The Agreement 
stipulates that Parties retain their rights and obligations under the WTO Agreement on Safeguards 
and Article XIX of the GATT 1994. The Agreement do es not confer new rights or obligations in 
respect of global safeguard actions, except that the Party taking the global safeguard measure may exclude the other Party's originating imports if such imports are not the "substantial cause" of 
the serious injury or threat thereof. 
3.49.  Unless for simultaneous application of a bilateral and global safeguard, the Agreement's 
dispute settlement cannot be applied for global safeguard actions. 
3.4.2.2  Bilateral safeguards 
3.50.  Bilateral safeguard measures (Articles 8.1-8.6) are authorized as exceptional measures 
during the "transition period". For products for which tariffs are eliminated in less than 5 years (77.7% and 83.6% of lines for Costa Rica and Peru, respectively), the transition period lasts until 
May 2018 (5 years from the entry into force of the Agreement). For products for which tariffs are 
eliminated in 5 or more years, the transition period expires two years after the product's full 
liberalization - i.e. at the latest in December 2028. Bilateral safeguards may take the form of a 
temporary suspension of further tariff reductions or of a tariff increase to a level that will not 
exceed the lesser of the MFN applied rate in effect at the time the action is taken and the base rate as provided in the schedule of duty elimin ation set out in Annex 2.3. TRQs or quantitative 
restrictions are explicitly prohibited.  
3.51.  Subject to an investigation, a bilateral safeguard may be imposed in cases where imports of 
an originating product for which tariffs had been reduced or eliminated according to the TEP have 
increased in absolute terms or relative to domestic production and under such conditions that they 
constitute a substantial cause of serious injury, or of threat thereof, to the domestic industry of 
like or directly competitive goods; provided this is necessary to prevent or counter the injury, and 
to facilitate adjustment by the domestic industry. Article 3 and paragraph 2 of Article 4 of the 
WTO's Safeguards Agreement (procedures of investigation and transparency) are integrated into 
                                               
15 The same time-frame applies in the WTO for technical regulations, as per the 2001 Ministerial 
Decision on Implementation-Related Issues and Concerns, WT/MIN(01)/17. Subsequently, the WTO TBT 
Committee encouraged an interval of more than six months, see G/TBT/1/Rev.10, p.26. 
16 As of January 2014, the relevant document is to be found in G/TBT/1/Rev. 11.  WT/REG342/1/Rev.1 
 
- 21 - 
 
 
 the Agreement; the definition s are those of the Agreement.17 The timeframes related to 
investigations are those of the relevant national legislation. Additional transparency provisions require prompt written notification of the init iation of a bilateral safeguard proceeding, the 
imposition of a provisional bilateral safeguard measure and the adoption of a final decision for the 
application/extension of a bilateral safeguard. The public version of a report by the investigating 
authority shall be transmitted to the other Party. Upon request by the affected Party, consultations shall be held to review notifications or public information regarding the case concerned 
(Article 8.5). 
3.52.  A bilateral safeguard measures may last a maximum of two years,
18 with a possible 
extension of one year under certain conditions. The maximum duration is in any case limited by the transition period. If the measure lasts more than a year, it shall be progressively liberalized. 
Re-application of safeguards is only authorized if an interval equal to the duration of the previous 
measures has elapsed; the non-application period must be of the least one year. Upon termination of the safeguard measure, the applied tariff will be  that resulting from the normal application of 
the TEP. 
3.53.  Compensation shall be provided upon the application of a bilateral safeguard measure, and 
consultations to that end shall take place within 30 days after the imposition of the bilateral 
safeguard. The compensation, of equivalent trad e effect, is to be mutually agreed with the 
exporting Party within 30 days from the beginning of the consultations; if no such agreement is 
reached within this period retaliation is authorized (Article 8.6). 
3.54.  Provisional measures of a maximum duration of 200 days are allowed in critical 
circumstances upon a preliminary determination of injury or threat thereof to the domestic 
industry; this time is to be included in the duration of the definitive safeguard measure (Article 8.4). Following final determination, amounts paid in excess will be reimbursed without delay.  
3.4.3  Anti-dumping and countervailing measures 
3.55.  Section C of Chapter 8 addresses anti-dumping and countervailing measures. The 
Agreement stipulates that the Parties retain their rights and obligations under Article VI of the 
GATT 1994 and the WTO Agreements on Anti-Dum ping and on Subsidies and Countervailing 
Measures. Article 8.9:3 provides that without prejudice to WTO Agreements, the investigating authority will disclose all essential information used for the determination of an antidumping or countervailing measure. This information shall be sent in writing to the interested parties, who 
shall be given enough time to provide their comments in writing and orally.  
3.4.4  Subsidies and State-aid 3.56.  The Agreement prohibits the granting of ex port subsidies on intra-trade in agricultural 
products, and dispute settlement applies in this respect (Article 2.15). There are no other 
disciplines on subsidies and State-aid. 
3.4.5  Customs-related procedures 
3.57.  The Agreement addresses three major issues as regards customs-related procedures: origin 
procedures, dealt with in in Section B of Chapter 3; trade facilitation and customs procedures, dealt with in Chapter 4; and customs cooperation, dealt with in Chapter 5.  
3.4.5.1  Origin procedures 
3.58.  Proof of origin is granted either by a Certificate of Origin
19 or a Declaration of Origin,20 both 
of which are valid for one year (Articles 3.16 and 3.17, respectively). While the former is to be 
                                               
17 "Substantial cause" is defined as  an important cause and no less im portant than any other; "serious 
injury" means a general damage to a domestic industry. No definition or numeric benchmark is provided as 
regards "domestic industry". 
18 Any provisional safeguard measure applied will be also counted in this period. 
19 Included in Annex 3.16, available at: 
http://www.comex.go.cr/tratados/proceso_legislativ o/peru_tlc/textol_tratado/capitulo%203/01_Anexo%203.1
6%20Certificado%20de%20Origen.pdf  WT/REG342/1/Rev.1 
 
- 22 - 
 
 filled in by the exporter and submitted to the en tity competent to issue it, the latter is a self-
declaration by an "authorized exporter"; the cond itions and requirements for being designated as 
such by the exporting Parties' competent authority or, when applicable, by its authorized entity are included in Article 3.18. Future use of digital certificates of origin are envisaged; as of March 2014, 
progress had not been achieved in this respect.  
3.59.  Both documents can only be issued for originating goods prior to or at the time of loading 
for export; in exceptional cases, a Certificate of Origin can be issued after the exportation.
21 In 
cases where the exporter is not the producer, the former may request the issuing of a Certificate 
of Origin on the basis of either information provided by the producer or of a Declaration of Origin supplied by the producer.
 When the good is not originating, the exporter to whom a Certificate of 
Origin was issued shall promptly notify the competent authority in the importing Party, with copies 
to the exporting Party's authorized entity and competent authority, as well as the importer.  
3.60.  At the Agreement's entry into force, the Pa rties will notify each other of their authorized 
entities and accredited officials, including their stamps and signatures (Article 3.19). Equally, 
information on authorized exporters will be supp lied by the Parties' competent authority or, when 
applicable, by its authorized entity to the importing Party's competent authority. 
3.61.  Obligations with respect to imports are contained in Articles 3.21; Articles 3.22-3.25 deal 
with reimbursement of customs duties, supporting documents and specifies that these, as well as 
other proof of origin have to be kept for at least five years from their emission. Proof of origin is not required when the import value is under US$1,000 or when the importing Party exempts a 
good from the proof of origin requirement (Article 3.25), unless such imports are aimed at 
circumventing obligations under the rules of origin chapter. 
3.62.  Rules relating to verifying the origin of a good are contained in Articles 3.26-3.30. The 
competent authorities of the importing Party may submit a written request for information or a 
written questionnaire to the importer and exporter or producer, or visit the exporters or producers 
in the territory of the exporting Party. Requests for information or 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 from the importing Party's authorities shall be preceded by a written notice of at least 30 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 ex porter 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 15 days from receipt of the notification, the importing Party may deny preferential tariff tr eatment on the good subject to verification. 
3.63.  The result of the verification, including its reasoning, shall be notified in writing by the 
competent authority of the importing Party to the exporter or producer within 365 days from the 
receipt of the notification of the initiation of the verification process (Article 3.26:11). Notification 
of the importer and of the competent authority of  the exporting Party is also required. If the 
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. If the originating status is denied, the importing Part y may also suspend preferential tariff treatment 
of any subsequent importation of identical goods from the same exporter or producer until such 
time as it can prove that it fulfils the requirements of Chapter 3 and apply sanctions in accordance with the Agreement and its domestic legislation. 
3.64.  The Parties are to ensure that importers, exporters and producers have access to review 
and appeal procedures. As of March 2014, Uniform regulations relating to the interpretation, application and administration of Chapter 3 had no t been adopted. Finally, any reexport from the 
Colon Free Trade Zone in Panama requires, beyond its corresponding proof of origin, a 
"reexportation certificate" issued by Panama's authorities and validated by the administrative authorities of the Zone certifying that the goods have remained under customs control and no processing had taken place except those necessary to preserve them in good conditions; goods 
                                                                                                                                               
20 Included in Annex 3.17, available at: 
http://www.comex.go.cr/tratados/proceso_legislativo/ peru_tlc/textol_tratado/capitulo%203/02_Anexo%203.1
7%20Declaracion%20de%20Origen.pdf  
21 In case of errors or involuntary omissi ons or for any other ju stified circumstance. WT/REG342/1/Rev.1 
 
- 23 - 
 
 
 accompanied by these two documents will retain the benefits of the corresponding preferential 
treatment.  
3.65.  A Committee on Rules of Origin, to meet at least once a year, is established. 3.4.5.2  Trade facilitation 
a. Chapter 4 of the Agreement deals with trade facilitation. Among its disciplines, it 
provides: 
i. that clearance take place within 48 hours whenever possible and directly from the 
entry point unless additional controls are needed from the customs authorities or for 
infrastructure reasons;  
ii. that risk management be undertaken selectively; 
iii. that special customs procedures be implemen ted to deal with expedited shipment, so 
that clearance can take place within 6 hours in normal circumstances; 
iv. the establishment of "authorized economic operators" (in accordance with the World 
Customs Organization framework) in orde r to facilitate clearance of goods;  
v. the creation in the Parties of a "single window" for foreign trade; 
vi. access of natural and juridical persons to review and to administrative and judicial 
appeal procedures of administrative acts related to customs;  
vii. advanced rulings of tariff classification, customs valuation, originating status, 
whether it qualifies for duty exemption as it has been reimported after repair or a l t e r a t i o n  o r  a n y  o t h e r  a g r e e d  i s s u e ,  t o  b e  p r o v i d e d  w i t h i n  1 5 0  d a y s  f r o m  t h e  request by an importer in a Party's territory or by an exporter or producer in the 
territory of the other Party; and 
b. the establishment of a Committee on Trade Facilitation and Customs Procedures. 
3.4.5.3  Customs cooperation 
3.66.  The Chapter provides the framework for facilitating cooperation and mutual assistance 
between the Parties' authorities on subjects related to customs, covering issues such as technical and administrative assistance for the appropriate implementation of customs legislation; 
prevention, investigation and sanction against illicit customs activities and customs offenses; and 
the facilitation of customs procedures.  
3.67.  The Chapter provide disciplines related to the supply of information, including on national 
legislation and customs procedures, transparency, and verification. 
3.4.6  Other regulations 
3.68.  The Parties rights and obligations as rega rds State-trading enterprises are in accordance 
with Article XVII of the GATT 1994, its interp retative notes and the Understanding on the 
Interpretation of Article XVII of the GATT 1994,  which are incorporated into the Agreement 
(Article 2.12). 
4  PROVISIONS ON TRADE IN SERVICES 
4.1  Scope and definitions 
4.1.  Trade in services is governed by Chapter 13 on Cross-Border Trade in Services together with 
Chapter 12 on Investment and Chapter 14 on the Temporary Entry of Business Persons. The Agreement adopts a negative-list approach.  WT/REG342/1/Rev.1 
 
- 24 - 
 
 4.2.  Chapter 13 applies to measures affecting trade in services by service suppliers of a Party, 
adopted or maintained by the other Party at the central, regional or local level, and by non-governmental bodies in the exercise of powe rs delegated by government authorities. Three 
out of the four GATS modes of supply - cross-bo rder trade, consumption abroad and temporary 
movement of natural persons - are covered in Chapter 13 (Article 13.15). Mode 3 on right of 
establishment/commercial presence is covered in the investment Chapter (Article 12.30), though Chapter 13 disciplines on subsidies, market access, transparency and domestic regulation apply in 
the context of a covered investment.  
4.3.  The following are excluded from the Chapter's coverage (Article 13.1:3): 
i. air transport services, including 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;  
ii. government procurement; and 
iii. subsidies and donations granted by a Party.  
4.4.  Financial services, as defined by GATS Article I:2 - i.e. all modes of supply - are excluded for 
the Agreement's coverage (Article 13.1:8). 
4.5.  Article 13.1 also clarifies that Chapter 13: 
a. does not impose any obligation on the Parties with respect to a national of the other 
Party seeking access to its employment mark et or already employed on a permanent 
basis in its territory. It also does not confer any right on that national with respect to that access or employment, nor does it apply to any measure relating to acquisition of 
citizenship, right of residence, nor migration measures; and 
b. 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. 
4.6.  Chapter 12 on investments consists of three sections - substantive obligations, dispute 
settlement investor-State and definitions (Section s  A ,  B  a n d  C ,  r e s p e c t i v e l y ) .  I t  p r o v i d e s  a  
definition of investment (Article 12.30) as assets owned or controlled by investors of a Party, and 
provides a list of forms that investment may take; "covered investments" are defined as the 
investment in a Party's territory of an investor from the other Party existing at the time of the 
Agreement's entry into force or afterwards. The scope of the Chapter (Article 12.1) is as follows: 
a. measures adopted or maintained by a Party relating to (i) investors of the other Party; 
(ii) covered investments; and (iii) all investments in the territory of the Party with 
respect to performance requirements and environment-related measures (respectively Articles 12.6 and 12.8). However, measures maintained by a Party in relation to 
investors of the other Party, and their investment, in financial institutions in its own 
territory are not covered by this Chapter; and 
b. measures adopted by a State-trading enterprise or a person, whenever any of them 
operate through a governmental delegation of authority. 
4.7.  In this Factual Presentation, detailed info rmation 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 4.64.   
4.8.  Beyond the exclusion of investment measur es related to financial institutions, Chapter 12 
also does not oblige a Party (i) to privatize any State-controlled investment, (ii) to protect investment with capital from illegal activities, nor (iii) to forbid a Party to take measures needed to 
preserve public order or for national security (Article 12.1). 
4.9.  An annual review, or otherwise if agreed, of the implementation of Chapter 13 is foreseen 
(Article 13.14). WT/REG342/1/Rev.1 
 
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 4.2  Denial of benefits 
4.10.  Under Articles 13.13 and 12.12, respectively, a Party can deny the benefits provided to a 
service-supplier, or to an investor from the other Party that is an enterprise of the other Party and its investments, if: 
a. the enterprise is owned or controlled by persons of a third party and the enterprise has 
no substantial business operations in the territory of the other Party; or 
b. the enterprise is owned or controlled by a person of the Party denying the benefit and 
the enterprise has no substantial business operations in the territory of the other Party. 
4.11.  Denial of benefits relating  to trade in services require prior notification and consultations.  
4.12.  Denial of benefits as regards cross-bord er trade in services can be challenged through 
Chapter 15 dispute settlement provisions; for investments, the applicable provisions are those of 
Chapter 15 on dispute settlement provisions and Section B of Chapter 12.  
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.  The negative-list approach also applies as regards market access for cross-border trade in 
services and right of establishment; the disciplin es are contained in Article 13.5. Such market 
access disciplines cover all the four modes of supply, since Article 13.1:4 extends to them the right of establishment in the context of an investment. However, according to the footnote included in Article 13.1:4, the Investor-State dispute settlement mechanism does not apply with respect to 
the market access obligation for the right of establishment (mode 3); any dispute settlement 
between a Party and an investor of the other Party is regulated by Section B of Chapter 12. 
4.15.  Market access disciplines and prohibited limitations generally mirror those of the GATS. 
4.16.  The GATS general prohibition on foreign eq uity limitations as regards investment from the 
other Party is generally maintained, given that national treatment applies to investments and investors of the other Party, except as explained in paragraph 4.21.   below.  
4.3.2  National treatment and MFN 
4.17.  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.  
4.18.  National treatment and MFN disciplines apply as follows: 
a. to cross-border services suppliers of the other Party (Articles 13.3 and 13.4); and 
b. to investors of the other Party and their covered investments (Articles 12.2 and 12.3), in 
accordance with the "standard of treatment" as defined in Article 12.4 – i.e. in 
accordance with international customary law, including fair and equitable treatment and 
full protection and security. The dispute settl ement provisions of the investment Chapter 
are not subject to the MFN obligation.  
4.19.  Non-conforming measures affecting trade in services, investors and investments covered by 
the Agreement that constitute exceptions to thes e principles are as follows (as per Articles 12.7 
and 13.7): 
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. The non-conforming WT/REG342/1/Rev.1 
 
- 26 - 
 
 measures applied by central or regional governments are listed in Annex I, those applied 
at the local level are not listed but also constitute derogations from the Agreement. Given Peru's unitary State, non-conforming measures only apply at the central level of government, for Costa Rica the non-conforming measures apply to the local level but 
they do not have to be listed. 
b. future measures applied on any sector, sub-sector or activities included in Annex II. 
Requirements to sell or use existing investments which are based on nationality cannot 
be applied to investments existing at the time when the measure enters into force 
(Article 12.7:4). 
4.20.  Amendments or modifications made on an y non-conforming measure under Annex I will be 
notified to the other Party as soon as possible; measures adopted as per Annex II will be notified 
to the other Party whenever possible (Article 13.8). None of these disciplines may be challenged 
through the Agreement's dispute settlement. 
4.21.  Further, national and MFN treatment do not apply to foreign investments/investors in the 
context of (i) measures adopted in accordance with Articles 3, 4 and 5 of the WTO TRIPS 
Agreement; (ii) government procurement of a Party; and (iii) subsidies or grants by a Party (Article 12.7). 
4.3.3  Commercial presence 
4.22.  Under Article 13.6, a cross-border service supplier 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 cross-border supply of service. Exceptions to this principle, in 
4.19.  -4.20.   above apply, mutatis mutandis . 
4.3.4  Movement of natural persons 4.23.  Chapter 14 lays out the conditions for the temporary entry of three categories of business 
persons
22 in the Parties' territories and associated timeframes for such entry - 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 14.1).  
4.24.  Annex 14.3.2 sets the period of stay for each category of natural persons. While for Peru, 
these are specifically set, for Costa Rica the stay  is established in a discretionary manner by the 
authorities within the maximum time-frame provided therein. 
4.25.  According to the Annex 14.3.1, each Party commits to grant an authorization of temporary 
entry to: 
a. Business visitors (Section A) engaged in certain business activities (meetings and 
consulting work; research and developmen t; farming, manufacturing, production; 
trading; sales; after sales services; general services). Such authorization will not require 
a work permit or employment authorization, but may require a pre-entry visa; entry will be authorized as long as the business person (i) presents proof of citizenship of a Party; 
(ii) presents documents proving the business ac tivity to be carry out and the purpose of 
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 a declaration that both the primary source of 
remuneration and the principal place of busi ness and profits accrued are mainly from a 
foreign country. A written declaration is required for Costa Rica, and the time of stay 
                                               
22 Article 14.10 defines "business person" as a national of a Party who is engaged in trade in goods, the 
supply 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. WT/REG342/1/Rev.1 
 
- 27 - 
 
 
 may vary between 1-30 days, with a possible 30-90 day extension and a longer stay of 
1 year with a possible extension of up to 2 years. For Peru, the duration is 183 days.  
b. Traders seeking to conclude an important deal  relating to trade in goods or services 
between the Parties, and investors (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,23 provided the person 
complies with the applicable immigration regulations. The Parties cannot require a proof 
of working certification or similar elements nor apply quantitative restrictions in that 
respect, but may require a visa prior to such entry. For Costa Rica, the period of stay for traders is the same as a. above; for investors it is between 90 days to 2 years, with a possible extension of up to 2 years. For Peru, the same duration as a. above applies to 
traders and investors who are seeking to commit an investment, while investors who are 
granted the migratory condition of independents are allowed a stay up to 1 year, with possible extensions conditional on the maintenance of the conditions underlying its 
grant.  
c. Intra-company transferees (Section C) who work in an executive and managerial 
position, or one that requires specialized knowledge. The Parties may require acceptance 
of the work contract by the competent authority prior to granting the temporary entry 
authorization as well as a visa prior to such entry. The Parties remain free to apply quantitative restrictions in that respect. For Costa Rica, the time of stay is 1 year with a possible extension of up to 2 years, while for Peru, the duration is the same as 
independent investors under b. above.  
4.26.  According to Article 14.7, a Party cannot initiate a dispute settlement procedure under 
Chapter 15 following the refusal of temporary entry, unless the case is recurrent practice and the 
business person has exhausted all possible administrative remedies available.
24 
4.27.  Additional transparency clauses are incl uded in Articles 14.4 and 14.9; they include 
enhanced commitments regarding availability of information on measures related to Chapter 14 in 
general, as well as to individual requests so that each Party committed itself to have mechanisms 
for replying to consultations by interested person s on requests and procedures applying temporary 
entry for business persons and to inform the person concerned of the decision taken within a reasonable time-frame, and upon his/her request,  endeavour to provide information without undue 
delay regarding the progress of the request. 
4.28.  The Agreement creates a Committee on Temporary Entry for Business Persons (Article 14.5) 
which will meet at least once every three years to  examine the application of Chapter 14, charged 
inter alia  with considering measures aimed at facilitating the temporary entry for business persons 
as well as establishing mechanisms for the exchange of information about these measures. 
4.3.5  Performance requirements 
4.29.  The prohibitions in Article 12.6 of certai n performance requirements, or of conditioning 
advantages upon their fulfilment, apply as regards investments
25 of investors not only from the 
other Party, but also from any third party, thus multilateralizing such preferential treatment. The 
list of prohibited performance requirements is 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.  
4.30.  Seven categories of performance requirem ents are prohibited; while some of them (i.e. 
those relating to goods) are in any case alre ady prohibited under the WTO Agreement on Trade-
Related Investment Measures (TRIMs), others are not - such as, for example, the prohibition of 
                                               
23 In the case of Costa Rica, the minimum capital of  the investment should be $200,000; in the case of 
Peru, the current amount is US$ 30,000. However, this is not bound in the Agreement. 
24 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. 
25 This applies to the establishment, acquisition, ex pansion, management, conduct, operation, sale or 
other, of an investment.  WT/REG342/1/Rev.1 
 
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 measures such as export obligations and technology transfer requirements. In addition, it is 
forbidden to condition the grant or receipt of an  advantage to investments of investors from the 
other Party or any other Party on the fulfilme nt of any of the four types of performance 
requirements listed in paragraph 5, including e.g. domestic content and trade balancing. 
4.31.  Paragraphs 2, 4 and 6 of Article 12.6, respectively, make clear that the following 
requirements are not prohibited: (i) the mandatory use of technology for complying with health, security or environment requirements; (ii) an authorisation by a Party to use an intellectual 
property right in accordance with article 31 and measures compatible with article 39 of WTO TRIPS 
Agreement; (iii) that the Chapter's advantages for a covered investment or an investment from an 
investor from a non-Party be made conditional on  the training of employees; and (iv) linking the 
receipt of an advantage for an investment on the requirement to locate the production, supply 
services, employ and train employees, build or enlarge installations, or conduct research and 
development activities in its own territory. Para graph 9 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 unjustified manner, or do not constitute a disguised trade or investment restriction. In addition, 
specific exceptions to this Article's disciplines, contained in paragraph 4.19.  -4.20.   above apply 
mutatis mutandis . 
4.32.  Other exceptions to the performance requirements prohibition are stated in Article 12.6:8; 
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, or in the context of qualifyi ng for preferential tariffs or quotas.  
4.3.6  Senior management and board of directors 
4.33.  For an enterprise of a Party that is a covered investment: 
a. as regards senior management, nationality requirements are prohibited; and 
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 12.5). 
4.34.  Other exceptions to the prohibition on nationality requirements are in Annexes I and II of 
the Agreement, as well as to government procurement and subsidies or grants by a Party 
(Article 12.7:5). 
4.4  Liberalization commitments 
4.4.1   Costa Rica 
4.35.  Under the Agreement, Costa Rica has listed three horizontal restrictions in Annex I, namely 
associations located abroad that want to operate in Costa Rica and foreign juridical persons that 
have or want to open branches in Costa Rica may be obliged to constitute and maintain a power of 
attorney for the branch's business; activities in the coastal areas; and preferential treatment to 
nationals in case of tenders for a concession, which also requires the constitution of a corporation ("sociedad anónima")." Finally, performance requir ements applying to enterprises established in 
free-trade zones with respect to the sales of goods and services to the domestic market can also 
be considered as a horizontal limitation.  
4.36.  Annex II reservations allow MFN discrimination for future bilateral or multilateral 
agreements involving aviation, fisheries, or maritime matters, including salvage, and cultural 
industries. Other Annex II reservations, which al low various non-conforming measures including 
QRs, are taken in respect of minorities and indigenous-related issues; social services - i.e. law 
enforcement and social readaptation, retirement, services related to income security, insurance, 
social security, social welfare, public education and training, health, childcare, sewage and water supply -; electrical energy; betting and lottery; railways, ports and airports; and natural resources WT/REG342/1/Rev.1 
 
- 29 - 
 
 
 excluding fish (already covered in Annex I). Other Annex II reservations are sector-specific and 
are reflected in Table 4.1. 
4.37.  In terms of sectoral coverage, Costa Rica's commitments under the GATS are limited to 5 of 
the 12 sector groups in the W/120 classification ; the Agreement goes significantly beyond its 
commitments under the GATS, as can be seen in the Table below.  
Table 4.1 Costa Rica: Sector-specific liber alization under the Agreement, excluding 
mode 4  
Sectors (CPC Classification) GATS RTA 
Sectoral 
Commit Compared 
to the 
GATS Existing non-
conforming 
measures Reservations for 
future measures 
NT, MFN, 
LP, 
SMBD, PR QRs NT, MFN, 
LP, SMBD, 
PR QRs 
1. Business services       
A. Professional Services Partial Improved  L   
B. Computer and Related Services Partial New     
C. Research and Development Services --- New     
D. Real Estate Services --- New      
E. Rental/Leasing Serv ices without Operators Partial Improved      
F. Other Business Services --- New   L  L 
2. Communication services       
A. Postal services --- Similar    L 
B. Courier services --- New     
C. Telecommunication services --- New   L   
D. Audiovisual services --- Similar   L  L 
E. Other --- New      
3. Construction & related engineering 
services       
A. General construction wo rk for buildings --- New     L 
B. General construction work for civil 
Engineering --- New    L 
C. Installation and assembly work --- New     L 
D. Building completion and finishing work --- New    L 
E. Other --- New     L 
4. Distribution services       
A. Commission agents' services --- New      
B. Wholesale trade services --- New  L   
C. Retailing services --- New   L    
D. Franchising --- New     
E. Other --- New      
5. Educational services       
A. Primary education services Partial Improved     L 
B. Secondary education services Partial Improved     L 
C. Higher education services Partial Improved    L 
D. Adult education --- New    L 
E. Other education services --- New     L 
6. Environmental services       
A. Sewage services --- Similar     L 
B. Refuse disposal services --- Similar    L 
C. Sanitation and similar services --- Similar    L 
D. Other --- Similar    L 
7. Financial services Not covered by the Agreement 
8. Health related and social services       
A. Hospital services Partial Similar     L 
B. Other Human Health Services --- New    L 
C. Social Services --- New     L 
D. Other --- New    L 
9. Tourism and travel related services       
A. Hotels and restaurants (including 
catering) Partial Improved     
B. Travel agencies and tour operators 
services Partial Improved  L   
C. Tourist guides services Partial improved     
D. Other Partial Improved     WT/REG342/1/Rev.1 
 
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 Sectors (CPC Classification) GATS RTA 
Sectoral 
Commit Compared 
to the 
GATS Existing non-
conforming 
measures Reservations for 
future measures 
NT, MFN, 
LP, 
SMBD, PR QRs NT, MFN, 
LP, SMBD, 
PR QRs 
10. Recreational, cultural and sporting 
services       
A. Entertainment services --- New  L   
B. News agency services --- New     
C. Libraries, archives, museums and other 
cultural services --- New     
D. Sporting and other recreational services --- New  L   
E. Other --- New     
11. Transport services       
A. Maritime Transport Services --- Similar   L  L 
B. Internal Waterways Transport --- Similar   L  L 
C. Air Transport Services Partial Similar    L 
D. Space Transport --- New     
E. Rail Transport Services --- Similar     L 
F. Road Transport Services --- New  L   
G. Pipeline Transport --- New   L   
H. Services auxiliar y to all modes of 
Transport --- Similar   L   
I. Other Transport Services --- New      
12. Other services not included 
elsewhere --- New     
 
Note:    NT National treatment. LP Local Presence. SMBD Senior management and board of directors. PR Performance requirements. 
Partial: GATS commitments subject to some limitation(s ) under market access or national treatment, under 
any of the three modes. 
---: 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. 
L: Committed but subject to  market access limitations. 
: Reservation listed under the Party's Schedule. 
 Source:  WTO I-ITIP Services and Costa Rica's Annexes to the Agreement.  
 
4.38.  Costa Rica's commitments under the GATS for business services cover mainly computer and 
related services and rental/leasing services withou t operators, which are fully liberalized under the 
Agreement. All other subsectors are opened up, with reservations – normally nationality or 
residency requirements, but also the possibility to apply QRs – applying only on professional, 
research and development, private security se rvices and services incidental to fishing. 
4.39.  Costa Rica has no GATS commitments on communication services. The Agreement reserves 
postal activities for the State but fully liberalizes courier services. Telecommunication services are 
exploited through concessions, authorizations and permits; wireless services will remain under 
State control and will also be exploited through co ncessions. Radio and TV broadcasting (excluding 
contribution links between operators) are comp letely reserved as per Annex II. Audiovisual 
services suppliers are subject to registrati on requirements, and numerous non-conforming 
measures are applied vis-à-vis  advertisements, such as domestic content requirements, nationality 
of the speaker and discrimination among foreign speakers. Further, an Annex II reservation has been taken for any measure with respect to cultural industries. 
4.40.  Construction and related engineering se rvices; distribution services; environmental 
services; and recreational, cultural and sporting services are also not subject to commitments under the GATS. As regards construction services, the reservations that apply are those derived WT/REG342/1/Rev.1 
 
- 31 - 
 
 
 from certain reserved services (e.g. electrical energy, crude oil, ports). Restrictions apply to the 
distribution of crude oil and derivatives and elec trical energy, reserved for the State. As for 
environmental services, a broad Annex II reservation allows Costa Rica to take any measure relating to environmental services in general, while for collection and treatment of refuse services, 
limitations are narrower since non-conforming measures relating to performance requirements and 
senior management and boards of directors are no t allowed. Recreational, cultural and sporting 
services are opened up with exceptions: tourism marinas and related services are subject to 
reservations, news agency services are subject to residency requirements, administration and 
distribution of lotteries is reserved for the State and electronic betting services is listed in Annex II (as are services of cultural industries). QRs a pply regarding the number of shops that sell liquor. 
4.41.  Costa Rica has partial commitments in all levels of education under the GATS; under the 
Agreement, the sector has been fully liberalized with the single restriction that the Dean of a public 
para-university ("institución parauniversitaria pública") is a national of Costa Rica. However, Costa Rica introduces a general reservation for the whole sector in relation to possible future measures 
connected with public education. Health services are partially included under the GATS; under the 
Agreement, public health and social services are reserved in Annex II. 
4.42.  Costa Rica  has a limited commitment on some auxiliary air transport services under the 
GATS; all transport services other than air transport (with the exception aircraft repair and 
maintenance services, the selling and marketing of air transport services and computer reservation systems services which are covered) have been incorporated into the Agreement subject to various limitations. Construction and exploitation of railways, ports and airports are listed in Annex 
II. The air transport services subsectors cove red by the Agreement are subject to various 
limitations on investment in terms of both nation al and MFN treatment. Land transport services of 
both passengers and freight, and water transport services on domestic routes are not open for 
enterprises from Peru. Various other reservations apply, with nationality, equity or reciprocity 
requirements; in many instances, local presence is also mandatory.  
4.43.  With respect to tourism and travel-related  services, 49% foreign equity limitation in the 
GATS in tourism and travel agencies has been generally lifted to Peru; however Costa Rica is 
authorized to limit their number. As regards tourist guides, Peruvians with a residency in Costa Rica may supply these services; in the GATS, on ly nationals are allowed in these services. 
Restrictions apply with respect to the operation of marina services. 
4.4.2  Peru 
4.44.  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.  
4.45.  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 lists MFN non-conforming measures on radio transmission services within border areas, 
subject to authorizations, for existing measures. MFN 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.  
4.46.  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 and to deviate 
from obligations as regards social services. Future non-conforming measures could also be adopted in matters related to fishing; cultural industries; handicraft; audio-visual industries; jewellery and certain other artistic activities; water and sewage services; certain educational 
services; domestic and international land transportation of cargo or passengers in border areas; 
and public telecommunication services.  WT/REG342/1/Rev.1 
 
- 32 - 
 
 4.47.  Peru's horizontal limitations under the GATS are maintained in the Agreement: all 
employers in Peru, independent of their activities or  nationality, shall give preferential treatment to 
nationals when hiring; at least 80% of the staf f of a company established in Peru shall be 
Peruvian, and that shall represent at least 70% of the total payroll of the company; investments in 
a frontier area of 50 km are reserved for nationals. Further, a horizontal limitation in Annex II 
(reservation 16) allows Peru to apply market access limitations in all services sectors, except for some sectors/sub-sectors for which modes 1, 2 and 3 are generally liberalized; thus in practice 
only some sectors are effectively opened up for Costa Rica's suppliers ("L" or "C" in the last 
column of Table 4.2).  
Table 4.2 Peru: comparison between the GATS and the Agreement's specific 
commitments in trade in services  
Sectors (CPC Classification) GATS RTA 
Sectoral 
Commit. Compared 
to the 
GATS Existing 
non-
conforming 
measures: 
NT, MFN, 
LP, SMBD, 
PR Reservations for 
future measures 
NT, MFN, 
LP, 
SMBD, PR Market  
Access  
1. Business services      
A. Professional Services Partial Improved   L 
B. Computer and Related Services  --- New    
C. Research and Development Services  --- New   L 
D. Real Estate Services  --- New    
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   Q 
B. Courier services --- New   Q 
C. Telecommunication services  Partial Improved   L 
D. Audiovisual services --- New   Q 
E. Other --- New   Q 
3. Construction and related engineering 
services       
A. General construction work  for buildings --- New   Q 
B. General construction work for civil 
 Engineering --- New   Q 
C. Installation and assembly work  --- New   Q  
D. Building completion and finishing work  --- New   Q 
E. Other --- New   Q  
4. Distribution services      
A. Commission agents' services --- New    
B. Wholesale trade services Partial Improved    
C. Retailing services Partial Improved    
D. Franchising --- New    
5. Education services      
A. Primary education services --- New   Q 
B. Secondary education services  --- New   Q 
C. Higher education services  --- New   Q 
D. Adult education --- New   Q 
E. Other education services  --- New   Q 
6. Environmental services      
A. Sewage services --- New   Q 
B. Refuse disposal se rvices --- New   Q  
C. Sanitation and similar services  --- New   Q 
D. Other --- New   Q  
7. Financial services Not covered by the Agreement 
8. Health related and social services      
A. Hospital services --- New   Q 
B. Other Human Health Services --- New   Q  
C. Social Services --- New   Q 
D. Other --- New   Q  
9. Tourism and travel related services       
A. Hotels and restaurants (including  catering) Partial Improved    
B. Travel agencies and tour operators services Partial Improved    
C. Tourist guides services --- New    WT/REG342/1/Rev.1 
 
- 33 - 
 
 
 Sectors (CPC Classification) GATS RTA 
Sectoral 
Commit. Compared 
to the 
GATS Existing 
non-
conforming 
measures: 
NT, MFN, 
LP, SMBD, 
PR Reservations for 
future measures 
NT, MFN, 
LP, 
SMBD, PR Market  
Access  
D. Other --- New    
10. Recreational and cultural and sporting 
services      
A. Entertainment services Partial Improved   L 
B. News agency services --- Improved    
C. Libraries, archives, museums and other 
cultural services --- Improved    
D. Sporting and other recreation al services  Partial Improved    
E. Other --- New   Q 
11. Transport services       
A. Maritime Transport Services Partial Improved   Q 
B. Internal Waterways Transport Partial Improved   Q 
C. Air Transport Services --- New   L 
D. Space Transport  --- New   Q 
E. Rail Transport Services --- New   Q 
F. Road Transport Services --- New   L 
G. Pipeline Transport  --- New   Q 
H. Services auxiliary to all modes of transport  --- New   C 
I. Other Transp ort Services  --- New   Q 
 
Note:    
NT National treatment. 
LP Local Presence. SMBD Senior management and board of directors. PR Performance requirements. 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. 
L: Committed but subject to  market access limitations. 
Q: Fully free to impose QRs. : Reservation listed under the Party's Schedule. 
 Source:  WTO I-ITIP Services and Peru's Annexes to the Agreement.  
 
4.48.  Peru's sectoral liberalization under the Agreement goes beyond its GATS commitments. 
Tourism and travel related services, and distributi on services - covered in the GATS only with 
respect to some sub-sectors - is fully liberalized as regards modes 1-3 in market access and no 
reservation has been taken. Postal and courier services; construction and related engineering 
services; refuse disposal services; health-relat ed services; space, pipeline and other transport 
services, all not covered under the GATS, are libe ralized except that the possibility to impose 
future QRs remains. Investment in education, sewage and sanitation and social services has been 
liberalized, but reservations apply on for future measures limiting cross-border trade, and the possibility to impose future QRs is also maintained.  
4.49.  As regards business services, Peru covered some sub-sectors under the GATS; under the 
Agreement, non-conforming measures have been listed for some legal services, auditing and 
architectural services, R&D services, advertising services, services incidental to fishing, energy distribution, and investigation and security; as well as for future measures in services incidental to 
fishing and printing and publishing. For these sectors, some market access is provided with few 
limitations (e.g. number of notaries related to the population).  WT/REG342/1/Rev.1 
 
- 34 - 
 
 4.50.  Regarding communication services, Peru has covered under the GATS some 
telecommunication services only. In the Agreement, market access commitments have been undertaken for additional sub-sectors of telecommunication as well as audiovisual services, subject however to limitations. These apply to existing measures in telecommunication services, 
particularly on call-back services (as under the GATS) as well as on audio-visual services (through 
a "cultural" reservation). Market access limitations on telecommunications are restricted to the need for having a concession, authorization or registry; for other communication services, Peru 
does not assume market access commitments. 
4.51.  Recreational and cultural and sporting services - covered in the GATS only with respect to 
some sub-sectors and only partially liberalized in mode 3 - are fully liberalized as regards modes 1-3 in market access, but few reservations apply with respect to the share of nationals and 
their wages. 
4.52.  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 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).  
4.5  Regulatory provisions  
4.5.1  Domestic regulation 4.53.  The disciplines of Article 13.10 on domestic regulation, as well as enhanced transparency 
relating to them (Article 13.9) cover all the four modes of supply, since Article 13.1:4 extends 
these 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 B 
of Chapter 12. The Parties commit themselves to ensure a reasonable, objective and impartial 
administration of measures of general application for cross-border trade in services, with the exception of those measures under Annexes I and II. 
4.54.  Services-specific transparency measures (Article 13.9) commit each Party to (i) have 
mechanisms for replying to consultations by intere sted persons on regulations applying to trade in 
services and domestic establishment of a covered investment, taking into account budgetary and resource constraints; (ii) provide a written re ply, whenever possible, to substantive comments 
made by interested persons regarding draft regula tions; and (iii) whenever possible, provide for a 
reasonable time-frame between publication and entry into force of a regulation. 
4.55.  Article 13.10 provides that, whenever author ization is needed for the supply of a service, 
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 the latter, of the progress attained in the request 
without undue delay. These disciplines do  not apply however to Annex II measures. 
4.56.  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 13) as provided in GATS 
Article VI. 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. 
4.57.  Any progress achieved in the GATS with respect to these questions may require an 
adaptation of disciplines in this Article. WT/REG342/1/Rev.1 
 
- 35 - 
 
 
 4.5.2  Recognition 
4.58.  The Agreement has recognition as an aim, but sets no time-frame nor a specific plan or 
schedule to achieve this. 
4.59.  Article 13.11 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 autonomous or granted through an agreement or convention 
concluded with the other country; in that case, it could be open for accession for the other Party, 
or the negotiation of a similar instrument could be envisaged. No regulation or criterion in that respect may constitute a disguised barrier to trade in services, nor constitute a way to discriminate among countries. 
4.60.  Nothing in the Agreement obliges a Party to grant to the other Party MFN treatment as 
regards recognition granted to a third-party. (Article 13.11:2). 
4.61.  The Annex to Article 13.11 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. It is envisaged that working groups on professional services, reporting 
to the Commission, may be established to pilot such work; as of March 2014, these had not been 
established.  For mutually agreed professional services of an individual nature, each Party shall 
encourage professional bodies to develop proced ures for the granting of temporary licences for 
service suppliers of the other Party. An in-built clause provides for a review of the Annex every 
three years. 
4.5.3  Subsidies 
4.62.  Article 13.2 provides for that any progre ss achieved in the GATS with respect to these 
questions which would apply to both Parties may requir e an adaptation of disciplines of this Article. 
4.5.4  Safeguards 
4.63.  A BOP safeguard to the general freedom of  capital movement, applying to trade in goods 
and services alike, is included in Article 18.5. It provides that temporary, non-discriminatory 
safeguard measures with respect to payments and capital movements may be adopted or 
maintained by a Party in cases of serious difficulties, or threat thereof, on the BOP or the external financial situation of a Party; or the macroeconomic environment, in particular monetary and exchange rate policy. 
4.5.5  Other investment-related provisions 
4.64.  In addition to the information presented above, Chapter 12 on investments includes 
provisions dealing with the granting of the minimum standards of treatment, including fair and 
equitable treatment, to investments of investors of another Party in accordance with customary 
international law (Article 12.4); environment related concerns (Article 12.8); compensation for 
losses (Article 12.9); expropriation and compensation (Article 12.10); transfers (Article 12.11); 
special formalities and information requirements (Article 12.13); subrogation (Article 12.14) and a 
fully-fledged investor-State dispute settlement mechanism (Section B, Articles 12.15-12.29). 
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 16 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 16.1, each Party will designate a contact point to facilitate communication 
between the Parties on any matter covered by the Agreement within 60 days from its entry into WT/REG342/1/Rev.1 
 
- 36 - 
 
 force; as of March 2014, this had not been done. 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 other Party and to interested persons. Beyond that, each Party has committed "to the extent possible" to publish any proposed law, regulation, procedure and 
administrative ruling of general application that relates to the Agreement, and to provide the other 
Party and interested persons with the opportunity make comments (Article 16.2). Upon request by the other Party and within the limits set out by domestic legislation, a Party is to provide information and promptly respond to questions pertaining to any measure that could substantially 
affect the Agreement (Article 16.3), without prejudice to whether the measure is consistent with 
the Agreement. 
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 (Article 16.4). 
5.2  Current payments and capital movements 5.5.  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 13.12) and investment 
(Article 12.11). Under the above-mentioned Articles, the Parties shall permit all transfers relating 
to the cross-border supply of a service, or to a covered investment, freely and without delays, in a currency benefitting from free circulation and under normal current exchange rates. However, 
limitations on transfers and payments are authoriz ed (paragraph 3 of both Articles) 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; serious BOP difficulties or threat thereof are 
also an exception to this freedom (see paragraph 4.63.   above). 
5.3  Exceptions 5.6.  Exceptions to the Agreement's disciplines are contained in Chapter 18, 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 2-7, and GATS Article XIV as exceptions to Ch apters 13 and 14 on trade in services.  
b. essential/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 information contrary to its security interests, nor to forbid the adoption of measures 
necessary to comply with its obligations relating to the maintenance or restoration of 
international peace or security, or to protect its security essential interests. 
c. taxation exceptions (Article 18.3) make clear that the Agreement does not apply to 
taxation measures nor affect the rights and obligations of any Party under any taxation 
convention. However, and subject to the terms and conditions specified in paragraphs 3 
to 7 of Article 18.3: 
i. national treatment applies with respect to taxation measures on trade in goods and 
to the taxation of income, capital gains or the taxable capital of corporations that 
relate to the purchase or consumption of particular services; 
ii. export taxes disciplines under the Agreemen t's Article 2.11 (Costa Rica authorized 
export taxes, see paragraph 3.33.  ) shall apply to taxation measures; WT/REG342/1/Rev.1 
 
- 37 - 
 
 
 iii. national treatment and MFN disciplines also apply with respect to taxation measures 
on investment and cross-border trade in services, except to those relative to income, capital gains or capital, or taxes on estates, inheritances, grants and generation-skipping transfers;  
iv. without prejudice to the rights and obligations of the Parties under paragraph i. and 
ii. above, certain disciplines relating to performance requirements shall apply to taxation measures; and 
v. disciplines relating to expropriation and compensation, and to the submission of a 
claim to arbitration shall apply to a taxation measure alleged to be an expropriation.  
d. exceptions relating to the disclosure of information (Article 18.4) provide that nothing 
under the Agreement obliges the Parties to furnish or allow access to confidential 
information whose disclosure could impede law enforcement, be contrary to public 
interest or that could be prejudicial to legitimate trade interests of public or private enterprises. 
5.7.  Finally, the BOP exception to the general fr eedom of capital movement is also addressed in 
Chapter 18, Article 18.5; it provides that temporary, non-discriminatory safeguard measures with respect to payments and capital movements may be adopted or maintained by a Party in cases of 
serious difficulties, or threat thereof, on the BOP or the external financial situation of a Party; or 
the macroeconomic environment, in particul ar monetary and exchange rate policy.  
5.8.  The Agreement also allows the Parties to take or maintain any measure to regulate the 
manufacture, use, sale, storage, transport, tr ade and possession of arms and explosives 
(Article 18.2 and Explanatory note of the Annex II).  
5.4  Accession and Withdrawal 5.9.  The Agreement has no provision regarding accession by a third-party. Either Party can 
terminate the Agreement (Article 19.6); the termination will take effect 180 days
26 after 
notification to the other Party.  
5.5  Institutional framework 
5.10.  The paragraphs below describe some of the main governing bodies under the Agreement; 
others have already been referred to elsewhere in this Factual Presentation. 
5.11.  The Agreement's main body is the Free Trade Commission, established in accordance with 
Article 17.1. The Commission consists of the representatives of Costa Rica's Ministry of Foreign 
Trade and of Peru's Minister of Foreign Trade and Tourism, or their successors. The Commission is 
responsible for enforcing and implementing the Ag reement and considering and adapting decisions 
towards the Agreement's objectives, including e.g. improvements in market access; 
recommending amendments; supervising the work of  all bodies established under the Agreement. 
The Agreement foresees that the Commission establishes its own rules and procedures; all its decisions are to be taken by mutual agreement. The Commission is to meet at least once a year.
27  
5.6  Dispute settlement 
5.12.  The Agreement provides for a mechanism to settle disputes between the Parties 
(Chapter 15) and between a Party and an investor  of the other Party (Chapter 12, Section B). 
Except as specified otherwise in the Agreement,  Chapter 15 applies to any dispute between the 
Parties related to the interpretation or application of the Agreement or wherever a Party considers 
that (Article 15.2) (i) an actual or proposed me asure of the other Party may be inconsistent with 
its obligations under the Agreement; or (ii) the other Party has otherwise failed to carry out its 
obligations under the Agreement. 
                                               
26 The Parties may agree on another period of time. 
27 The Commission may agree on another period of time. WT/REG342/1/Rev.1 
 
- 38 - 
 
 5.13.  For disputes regarding any matter arising under the Agreement and the WTO Agreement (or 
any other agreement of which both Parties are members) the complaining Party may select the forum for the settlement of the dispute. Once the forum has been selected, it must be used to the exclusion of the other (Article 15.3).  
5.14.  The dispute settlement mechanism provides for consultations and, except for proposed 
measures, the establishment of a Panel (composed of three members) which will examine the case 
and present a final report to the disputing Parties. Only a single report is foreseen. An 
implementation mechanism is also provided for; it may lead to retaliation authorization but also a 
review of the retaliatory measures; this is to be done by reconvening the original Panel. The Rules 
of Procedure are to be agreed (Article 15:8) in the first meeting of Free Trade Commission, unless the Parties otherwise agree (Article 17.1:2(d)). Also  foreseen is the possibility that the dispute be 
solved by arbitration or other means or for a su spension of the work of the Panel by mutual 
agreement, at any time (Article 15.15 and 15.16, respectively). WT/REG342/1/Rev.1 
 
- 39 - 
 
 
 Chart 5.1 Dispute Settlement Provisions of the Agreement 
 
Source: Chapter 15 of the Agreement. 
      Suspension of the benefits by the Complaining Party  (Art.15.11)   Implementation    
(Art. 15.10)   
 Non  -compliance    Termination   A compensation   
is requested  
(Art.15.11)    No compensation   
is requested  
(Art.15.11)    
 Compensation  
agreed but  non- 
compliance     No com pensation  
agreed     Max. 30 days    
  (a) agreement     (b) disagreement      
 Max. 30 days   15 days      Consultations   
(Art. 15.4)   Max. 30 days o r  
  15 days in cases of urgency   
 Max. 37 days     Request for establishment of DS Panel  
(Art. 15.5)  
  Composition of DS Panel  (Art. 15.7)  
Panel selection  : within 15 days    
Chair selection: within 30 days  
  Panel report    
(Art. 15.9)    Max. 120 days o r 
Max. 90 days in cases of urgency   
 Report Publication   
(Art. 15.9)    Request for consultations  
(Art. 15.4)  
 Max. 40 days o r  
  25 days in cases
of urgency   Technical advice (Art. 15.4:5 ) 
Alternative dispute 
resolution (Art. 15.15)  
(c) implementation review 
New Panel: 
(b) 60 days, 
(c) 90 days (Art. 15.12) WT/REG342/1/Rev.1 
 
- 40 - 
 
 5.7  Relationship with other agreements concluded by the Parties 
5.15.  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). In case of incompatibility, the provision of this Agreement will prevail to the extent of the incompatibility, 
unless otherwise provided for in the Agreement. 
5.16.  Other regional trade agreements to which Costa Rica and Peru are parties are listed in Table 
5.1.  
5.17.  Peru is a Party to the Pacific Alliance, a free-trade area also comprising Chile, Colombia and 
Mexico. The Pacific Alliance Framework Agreement 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 
and persons. There are 30 Observers States to the Pacific Alliance, of which Costa Rica - as an 
"Observer State Candidate".
28 
Table 5.1 Costa Rica and Peru: Participation in  other regional trade agreements (notified 
and non-notified, in force), as of 7 March 2014 
RTA Name Date of 
entry into 
force Type of 
Agreement Year of 
notification WTO Provision 
COSTA RICA 
European Union - Central America 01-Oct-13a Goods & 
Services 2013 GATT Art. XXIV & 
GATS Art. V 
Mexico - Central America 01-Jul-13b Goods & 
Services 2013 GATT Art. XXIV & 
GATS Art. V 
Costa Rica - Singapore 01-Jul-13 Goods & 
Services 2013 GATT Art. XXIV & 
GATS Art. V 
China - Costa Rica 01-Aug-11 Goods & 
Services 2012 GATT Art. XXIV & 
GATS Art. V 
Panama - Costa Rica (Panama - Central 
America) 23-Nov-08 Goods & 
Services 2009 GATT Art. XXIV & 
GATS Art. V 
Dominican Republic - Central America - United States Free Trade Agreement (CAFTA-DR) 01-Jan-09 Goods & 
Services 2006 GATT Art. XXIV & 
GATS Art. V 
Canada - Costa Rica 01-Nov-02 Goods 2003 GATT Art. XXIV 
Chile - Costa Rica (Chile - Central America) 15-Feb-02 Goods & 
Services 2002 GATT Art. XXIV & 
GATS Art. V 
Dominican Republic - Central America 07-Mar-02 Goods & 
Services 2012 GATT Art. XXIV & 
GATS Art. V 
Central American Common Market (CACM)  04-Jun-61 Goods 1961 GATT Art. XXIV 
CACM - Accession of Panama 06-May-13 Goods Not notified 
CARICOM - Costa Rica 15-Nov-05 Goods Not notified 
Venezuela - Costa Rica [LAIA, AAP.A25TM 
N°26] 27-Jul-94 Goods Not notified 
PERU 
European Union - Colombia and Peru 01-Mar-13c Goods & 
Services 2013 GATT Art. XXIV & 
GATS Art. V 
Panama - Peru 01-May-12 Goods & 
Services 2012 GATT Art. XXIV & 
GATS Art. V 
Japan - Peru 01-Mar-12 Goods & 
Services 2012 GATT Art. XXIV & 
GATS Art. V 
Peru - Mexico 01-Feb-12 Goods & 
Services 2012 GATT Art. XXIV & 
GATS Art. V 
Peru - Republic of Korea 01-Aug-11 Goods & 
Services 2011 GATT Art. XXIV & 
GATS Art. V 
EFTA - Peru 01-Jul-11d Goods 2011 GATT Art. XXIV 
Peru - China 01-Mar-10 Goods & 
Services 2010 GATT Art. XXIV & 
GATS Art. V 
Peru - Singapore 01-Aug-09 Goods & 
Services 2009 GATT Art. XXIV & 
GATS Art. V 
                                               
28 For additional information on the Pacific Alliance, see http://alianzapacifico.net/en/. WT/REG342/1/Rev.1 
 
- 41 - 
 
 
 RTA Name Date of 
entry into 
force Type of 
Agreement Year of 
notification WTO Provision 
Canada - Peru 01-Aug-09 Goods & 
Services 2009 GATT Art. XXIV & 
GATS Art. V 
Peru - Chile 01-Mar-09 Goods & 
Services 2011 GATT Art. XXIV & 
GATS Art. V 
United States - Peru 01-Feb-09 Goods & 
Services 2009 GATT Art. XXIV & 
GATS Art. V 
Global System of Trade Preferences among Developing Countries (GSTP) 19-Apr-89 Goods 1989 Enabling Clause 
Andean Community (CAN) 25-May-88 Goods 1990 Enabling Clause 
Latin American Integration Association 
(LAIA) 18-Mar-81 Goods 1982 Enabling Clause 
Protocol on Trade Negotiations (PTN) 11-Feb-73 Goods 1971 Enabling Clause 
LAIA - Accession of Panama 03-May-12 Goods Not notified 
Thailand - Peru (Early Harvest) 31-Dec-11  Goods Not notified 
Andean Community 14-Dec-06 Services Not notified 
MERCOSUR - Peru [LAIA, AAP,CE N°58] 02-Jan-06e Goods & 
Services Not notified 
Cuba - Peru [LAIA, AAP.CE N°50] 09-Mar-01 Goods Not notified 
LAIA - Seeds [AAP.AG N°2] 21-Aug-95 Goods Not notified 
Source: WTO Secretariat. 
 a  EU-Central America: The notifications made in February 2013 (see WT/REG332/N/1 and S/C/N/680) 
states that: "Provisional application of the Agreem ent by all signatory parties is expected in the 
course of the second quarter 2013"; Further notifications to confirm the specific date of entry into force between the EU and Costa Rica, and othe r Central American countries are awaited. 
b  Dates of entry into force differ: Mexico-Costa Rica as indicated in the table; with El Salvador and 
Nicaragua on 1 September 2012; with Honduras on 1 January 2013; with Guatemala on 1 September 2013.  
c  Dates of entry into force differ: EU-Peru as indicated in the table, EU-Colombia on 1 August 2013. 
d  Dates of entry into force differ: with Switzerlan d and Liechtenstein as indi cated in the table; with 
Iceland on 1 October 2011; with Norway on 1 July 2012. 
e  Dates of entry into force differ: with Argentina, Brazil and Uruguay as indicated in the table; with 
Paraguay on 6 February 2006. 
 Note: For those agreements negotiated under the LA IA framework, the LAIA reference is included in 
brackets. Details of these agreements can be found at: http://www.aladi.org .  
 
5.8  Government procurement 
5.18.  Chapter 10 and related annexes contain disciplines on government procurement.29 The 
Agreement covers procurement of goods and services by central and sub-central Government 
entities and other public entities listed in Annex 10.1; goods/services- excluded from the coverage are also included therein (e.g. clothes and shoes fo r the army, school restaurants, betting services, 
procurement in the context of programmes aiming  at favouring small and medium enterprises, 
etc.). This annex also states that any covered service remain however subject to the list of non-conforming measures related to services and investment.  
5.19.  Thresholds are specified in terms of the IMF special drawing rights (SDR). For construction 
services, a single threshold at SDRs 5,000,000 app lies for any procurement. Otherwise, for central 
government entities, the threshold is at 95,000 SDRs; this is set at SDRs 355,000 for sub-central entities and either at SDRs 160,000 or 400,000, for the other entities.
30 Modification of coverage, 
and the provision of compensation, is addressed in Article 10.16. Article 10.18 foresees the 
possibility for extending the Chapter's scope upon the request of one Party.  
5.20.  National treatment and non-discrimination principles are contained in Article 10.3; they 
apply in respect of goods and services from the other Party. Non-compliance with "originating 
status" in goods or in services, as provided for in the relevant Chapters, allows the denial of the Agreement's benefits (Article 10.3)  
                                               
29 The Parties are neither Members nor observers in the WTO Government Procurement Agreement. 
30 In the WTO Government Procurement Agreement, fo r a number of Parties the thresholds are set at 
130.000 SDR for goods and services procured by centra l government, and at 5,000,000 SDR for construction 
services. WT/REG342/1/Rev.1 
 
- 42 - 
 
 5.21.  Tendering procedures are described in Article 10.10-10.12; open tendering shall be the 
norm, but other tendering forms may to be applied under certain circumstances, provided they are 
not used as a way of distorting competition and discriminate between domestic and foreign suppliers (Article 10.10). Each Party must establish and maintain a domestic challenge procedure 
for procurement activities covered under the Agreement (Article 10.15), and the Parties are to 
establish or designate at least one impartial administrative or judicial authority, independent from the contracting authorities, to receive and review any complaint.  
5.22.  Numerous provisions (Articles 10.4-10.6, 10.13-10.14) deal with the dissemination of 
information relating to procurement, emphasizing th e importance of the use of electronic means to 
that end. Neither Party is required to provide information contrary to its public interests. The Parties endeavour to cooperate in order to achieve a better understanding of their public 
procurement systems and to facilitate access for thei r respective suppliers; to this end, each Party 
will provide the other Party and its suppliers information on training and guidance programmes on public procurement (Article 10.20). Under Articl e 10.21, the Parties establish a "Committee on 
Government Procurement. 
5.9  Intellectual property rights 5.23.  In its Chapter 9, the Agreement reaffirms the Parties' rights and obligations under inter alia  
the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and its 
related instruments, including e.g. the 2001 Ministerial Declaration on TRIPS and Public Health. National treatment and MFN are provided for; except ions to such principles are in accordance with, 
respectively, Articles 3 and 5, and 4 and 5, of the TRIPS Agreement (Article 9.2). The Chapter 
includes provisions on trademarks, geographical indications, biodiversity and traditional 
knowledge, copyrights and related rights, enfo rcement of IPRs, cooperation and science and 
technology. 
5.24.  The Parties remain free to provide wider protection than that under Chapter 9, in 
accordance with domestic legislation. 
5.25.  The Parties commit to protect trademarks and well-known marks in accordance with the 
TRIPS agreement (Article 9.3). They also extend the protection given in Article 16.3 of the TRIPS 
to well-known marks for dissimilar goods and services, irrespective of whether they are registered or not; well-known marks are specified as those known amongst the sector of the public dealing 
with relevant goods or services, determined in  accordance with their respective national 
legislation. Further, the Parties also commit to developing a system for the registration of 
trademarks in which (i) the applicant shall be notified in writing of the reasons for a refusal to register a trademark; (ii) interested people will be given an opportunity to oppose a registration 
request; (iii) decisions regarding registration and nu llity be explained in writing; and (iv) a right of 
appeal is provided for. 
5.26.  Costa Rica recognizes the following Peru vian geographical indications (GIs): "Pisco", 
"Cusco's giant white corn", "Chulucanas", "Pallar de  Ica", "Café Villa Rica", "Loche de Lambayeque" 
and "Café Machu-Picchu-Huadquiña". Peru recognizes "Banano de Costa Rica" as a Costa Rican GI. The Parties commit to protect each other's GIS, and thus to prohibit imports, production or sale of such products unless they are produced following the regulations governing their manufacture. The 
Parties remain however free to maintain or adopt, in their national legislation, measures related to 
homonymic GIs (Article 9.4). The Parties may grant protection to other GIs protected in the Parties, including denominations of origin, upon noti fication of one of the Parties of the protection, 
in accordance with the regular domestic procedures; no time-frame is specified for when such 
protection will become effective.  
5.27.  The Parties are free to determine the conditions of access to its genetic and biological 
resources (Article 9.5), in accordance with domestic and international rules; in particular, access 
will be subject to previous consent by the Part y based on mutually agreed terms. They also 
commit to respect, preserve and maintain the tr aditional knowledge, innovations and practices of 
their indigenous and local communities; access to the traditional knowledge associated with 
biological and genetic resources will also be subject to previous consent by their holders also on 
mutually agreed terms. Any IPR granted in connection to these will be in accordance with relevant domestic and international rules; in particular, the Agreement specifies that proof of legal access WT/REG342/1/Rev.1 
 
- 43 - 
 
 
 to such resources or knowledge and the disclosure of their origin shall be required in the context of 
a patent application, if domestic legislation so requires. The Parties are encouraged to cooperate in the exchange of available public information in the context of an investigation of illegal access of genetic resources and traditional knowledge in their territories.  
5.28.  Compared to the TRIPS Agreement, the Agreement widens the protection of authors and 
performers (Article 9.6) by providing for the prot ection of an author's/performer's moral rights 
after protection has expired, and also after deat h and at least until the expiry of the economic 
rights (as under Article 6bis of the Berne Convention), which are not included under the TRIPS 
Agreement. Further, each Party shall ensure that a broadcasting organization within its territory will at least have the exclusive right to authorize the fixation, reproduction and retransmission of its broadcasts.
31  
5.29.  Regarding enforcement (Article 9.7), the Parties may develop in their national legislation the 
measures, procedures and remedies to ensure the enforcement of IP rights. Right holders shall present "adequate evidence" in order to ask fo r the suspension of the release of suspected 
infringing merchandise. This adequate evidence mu st prove, to the satisfaction of the competent 
authority, that under the importing party legislation there is a presumption of IPR infringement to the rights of the right holder. Further, the righ t holder shall also provide sufficient information 
reasonably known by him so that the merchandise can be easily identified by the competent 
authorities;
32 the requirement to present such information shall not unreasonably deter the 
recourse to these procedures. In addition, the Parties' competent authorities have the authority to inform the right holder of the names and addresses of the consignor, the importer and the 
consignee and of the quantity of the goods when goods are counterfeit or pirated. The Agreement 
also allows the Party's competent authorities to initiate ex officio border measures if there are reasons to suspect that trade in counterfeit or pirated goods is taking place.  
5.10  Competition policy 
5.30.  Chapter 11 provides disciplines regarding competition policy, aiming at ensuring that 
benefits under the Agreement are not nullified th rough anti-competitive practices. The Chapter 
provides for inter alia  (i) the adoption or maintenance by each Party of a competition policy 
legislation, and a responsible authority; (ii) the notification of any competition-related activity applied in a Party that may be of interest to the other Party, at an early stage if possible; (iii) cooperation among responsible competition author ities on the enforcement of their respective 
legislation; (iv) exchange of information according to its domestic legislation; and (v) the 
possibility for consultations. Article 11.7 clarifies that no Party may have recourse to dispute settlement - either under the Dispute Settlement or Investment Chapters with respect to any issue 
under this Chapter. 
                                               
31 Under the TRIPS (Article 14), "broadcasting organiza tions shall have the right to prohibit the following 
acts when undertaken without their authorization: the fixation, the re production of fixations, and the 
rebroadcasting by wireless me ans of broadcasts, as well as the communication to the public of television 
broadcasts of the same". 
32 These requirements are more specific than those under Article 43 of the TRIPS Agreement, while the 
Agreement's requirement for the provision of a security or equivalent is similar to that under the TRIPS. WT/REG342/1/Rev.1 
 
- 44 - 
 
 ANNEX 1 
1. A comparison between preferential tariff s applied under the scheduled elimination 
programmes of each Party and MFN applied duties, by total, agricultural (WTO definition) and 
non-agricultural products, is shown in Tables A1.1 (Costa Rica) and A1.2 (Peru). Applied MFN duty 
rates in 2013 serve as a comparison. 
2. Table A1.1 shows that Costa Rica's average applied MFN rate in 2013 was 6.8%, with 13.6% 
on agricultural products and 5.6% on non-agricultural products. In 2013, only 2.2% of tariff lines 
were MFN duty free (zero for agriculture and 2.5% for non-agriculture). At the date of entry into 
force of the Agreement, Peruvian exporters enjoye d on average an absolute margin of preference 
(MOP) of 4.1% vis-à-vis the prevailing MFN tariff - 6% for agricultural goods and 3.7% for 
non-agricultural products; the share of duty free lines increased to 77.8% overall for imports from 
Peru (65.5% for agricultural products and 79.9% for non-agricultural products). By the end of 
implementation, 98.6% of the tariff lines are expected to have been liberalized for imports from Peru. 
Table A1.1 Costa Rica: Indicators of MFN tari ff rates 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 2013 6.8 6.9 2.2 13.6 13.6 0.0 5.6 5.8 2.5 
Peru 2013 2.7 12.4 77.8 7.6 22.1 65.5 1.9 9.6 79.9 
  2014 2.5 11.2 77.8 7.2 20.8 65.5 1.7 8.5 79.9 
  2015 2.2 10.0 77.8 6.7 19.4 65.5 1.5 7.3 79.9 
  2016 2.0 8.8 77.8 6.2 18.0 65.5 1.2 6.2 79.9 
  2017 1.7 9.1 81.4 5.7 21.5 73.3 1.0 5.9 82.8 
  2018 1.5 8.1 81.4 5.5 20.5 73.3 0.8 4.9 82.8 
  2019 1.3 7.1 81.4 5.2 19.5 73.3 0.7 3.9 82.8 
  2020 1.1 6.1 81.4 5.0 18.6 73.3 0.5 2.9 82.8 
  2021 0.9 5.1 81.4 4.7 17.6 73.3 0.3 1.9 82.8 
  2022 0.8 12.6 94.0 4.4 25.7 82.7 0.1 3.5 95.8 
  2023 0.7 11.8 94.0 4.3 24.9 82.7 0.1 2.7 95.8 
  2024 0.7 16.4 96.0 4.1 27.0 84.7 0.1 3.7 97.9 
  2025 0.6 15.6 96.0 4.0 26.1 84.7 0.1 3.0 97.9 
  2026 0.6 14.8 96.0 3.9 25.2 84.7 0.0 2.3 97.9 
  2027 0.6 40.7 98.6 3.7 46.8 92.0 0.0 12.2 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.  
 Based on the HS 2007 nomenclature.  Source: WTO estimates based on data provid ed by Costa Rica and WTO-IDB Database.  
 
3. Peru's average applied MFN rate in 2013 was 3.2%, with 4.1% on agricultural products and 
3.1% on non-agricultural products (Table A1.2). In 2013, 55% of tariff lines were MFN duty free 
(34.8% for agriculture and 58.1% for non-agriculture). At the date of entry into force of the 
Agreement, Costa Rica's exporters enjoye d on average an absolute MOP of 2.2% vis-à-vis  the 
prevailing MFN tariff – 2.7% for agricultural good s and 2.1% for non-agricultural products and the 
share of duty free lines increased to 83.6% overall (75.3% for agriculture and 84.9% for 
non-agriculture). By the end of implementation, 98.8% of the tariff lines are expected to have 
been liberalized for imports from Costa Rica.  
 
 WT/REG342/1/Rev.1 
 
- 45 - 
 
 
 Table A1.2 Peru: Indicators of MFN tariff rates and preferential rates for imports from 
Costa Rica 
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 2013 3.2 7.2 55.0 4.1 6.4 34.8 3.1 7.4 58.1 
Costa 
Rica 2013 1.0 6.3 83.6 1.4 6.5 75.3 1.0 6.3 84.9 
  2014 1.0 6.1 83.6 1.3 6.3 75.3 0.9 6.1 84.9 
  2015 0.9 5.4 83.6 1.2 5.5 75.3 0.8 5.3 84.9 
  2016 0.7 4.4 83.6 1.0 4.6 75.4 0.7 4.3 84.9 
  2017 0.5 5.2 89.7 0.7 6.0 83.4 0.5 5.0 90.7 
  2018 0.4 4.4 89.8 0.7 5.6 83.7 0.4 4.1 90.7 
  2019 0.3 3.5 89.8 0.6 5.2 83.8 0.3 3.2 90.7 
  2020 0.3 2.7 89.8 0.6 4.7 83.8 0.2 2.3 90.7 
  2021 0.2 1.8 89.8 0.5 4.2 83.8 0.1 1.4 90.7 
  2022 0.1 3.9 96.9 0.4 6.0 88.2 0.0 2.7 98.3 
  2023 0.1 3.4 96.9 0.4 5.6 88.4 0.0 2.0 98.3 
  2024 0.1 3.9 97.6 0.4 5.3 88.6 0.0 2.4 99.0 
  2025 0.1 3.4 97.7 0.3 5.0 88.9 0.0 1.8 99.0 
  2026 0.0 2.9 97.7 0.3 4.6 88.9 0.0 1.2 99.0 
  2027 0.0 7.5 98.8 0.3 7.8 91.8 0.0 6.0 99.9 
 
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 subject to price band, only the ad valorem  part is included in the 
calculation of averages. 
 Based on HS 2007 nomenclature.  
 
Source: WTO estimates based on data prov ided by Peru and WTO-IDB Database.  
 
4. Mutual market access conditions for each country's top 25 exports in the 2010-2012 period 
are presented in Tables A1.3 and A1.4, together with  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. WT/REG342/1/Rev.1 
 
- 46 - 
 
 5. Table A1.3 shows the market access conditions in Costa Rica for Peru's top 25 exports, 
covering 49 tariff lines, which in 2010-2012 accounted for around 80% of its global exports. None of these were fully free prior to the entry into fo rce of the Agreement, though two were partially 
liberalized (petroleum, 2710.11 and 2710.19). These two products, jointly with the other 21 – 
accounting in total for 37 tariff lines - were fully liberalized at entry into force, and an additional 
one line will become free in 2022. One product – coffee - accounting for 4 lines and 2.8% of trade will remain dutiable at the end of the transition period. 
Table A1.3 Costa Rica: Market access opport unities under the Agreement to Peru's top 
25 exports 
Peru's top export products in 2010-2012 Access Conditions to Costa 
Rica's import markets 
MFN (2013) Duty-
Free 
in 
Remain Dutiable HS number and description of the product Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) No. of 
tariff 
lines 
2013 
2022 Duty-free 
Dutiable 
710812 -- other unwrought forms 21.5 6.0  1 1   260300 Copper ores and concentrates. 17.7 1.0  1 1   740311 -- cathodes and sections of cathodes 5.7 1.0  1 1   230120 - flours, meals and pellets, of fish or of crustaceans, 
molluscs or other aquatic invertebrates 4.1 3.5  2 1 1  
260700 Lead ores and concentrates. 4.0 1.0  1 1   271011 -- light oils and preparations 3.4 3.6 1 6 6   271019 -- other 3.4 3.1 6 7 7   260800 Zinc ores and concentrates. 2.9 1.0  1 1   090111 -- not decaffeinated 2.8 13.8  4   4 
271111 -- natural gas 2.3 1.0  1 1   260111 -- non-agglomerated 1.8 1.0  1 1   270900 Petroleum oils and oils obtained from bituminous 
minerals, crude. 1.3 1.0  2 2   
261390 - other 1.2 1.0  1 1   261610 - silver ores and concentrates 1.2 6.0  1 1   610910 - of cotton 1.1 15.0  1 1   150420 - fats and oils and their fractions, of fish, other than 
liver oils 0.9 1.0  1 1   
070920 - asparagus 0.7 15.0  1 1   790111 -- containing by weight 99.99% or more of zinc 0.7 1.0  1 1   740811 -- of which the maximum cross-sectional dimension 
exceeds 6 mm 0.7 1.0  1 1   
080610 - fresh 0.7 15.0  1 1   710691 -- unwrought 0.7 10.0  1 1   251010 - unground 0.6 1.0  1 1   610510 - of cotton 0.6 15.0  1 1   800110 - tin, not alloyed 0.5 1.0  1 1   030749 -- other 0.5 5.5  2 2   Total of above 80.6  7 42 37 1 4 
 
Note: Based on HS 2007 nomenclature.  Source: WTO estimates based on data provided by Costa Rica and UNSD, Comtrade database. 
 WT/REG342/1/Rev.1 
 
- 47 - 
 
 
 6. Table A1.4 shows the market access conditions in Peru for Costa Rica's top 25 exports, 
covering 83 tariff lines, which in 2010-2012 accounted for 57.9% of its global exports. Seven products, accounting for around 6.9% of trade and covering 18 tariff lines, benefitted already from 
MFN duty free treatment prior to the Agreement's entry into force; two others were partially free. 
Seven other products, accounting for 29.3% of Costa Rica's exports and covering 11 tariff lines, 
became fully duty-free at entry into force; again two others were partially liberalized. A total of six products (two of which non-agricultural) – including one subject to the Peruvian price-band system 
- will remain dutiable at the end of the transition period (one only partially); that accounts for 12 
lines and 14.2% of Costa Rica's global exports.  
Table A1.4 Peru: Market access opportunities under the Agreement to Costa Rica's top 
25 exports  
Costa Rica's top export products in 2010-2012 Access Conditions to Peru's import 
markets 
MFN (2013) Duty-Free in  
Remain Dutiable HS number and description of the product Share in 
global 
exports 
(%) Average 
MFN 
applied 
rate 
(%) No. of 
tariff 
lines 
2013 
2015 
2017 
2022 Duty-free 
Dutiable 
080430 - pineapples 11.7 6.0  1 1     080300 Bananas, including plantains, fresh or dried. 11.4 6.0  5 5     090111 -- not decaffeinated 5.7 11.0  2     2 
210690 - other 4.7 1.5 9 5 1  2  2 
300490 - other 3.0 6.0  7 6 1    
401110 - of a kind used on motor cars (including 
station wagons and racing cars) 2.2 0.0 2       
151110 - crude oil 2.1 6.0  1 1     
481840 - sanitary towels and tampons, napkins and 
napkin liners for babies  and similar sanitary 
articles 1.8 6.0  3   3   
620711 -- of cotton 1.5 11.0  1 1     
170111 -- cane sugara 1.2 0.0 
SPFP+0%b 1 1     1 
080719 -- other 1.1 6.0  1 1     701090 - other 1.1 6.0  4    2 2 
300210 - antisera and other blood fractions and 
modified immunological products, whether or not obtained by means of biotechnological processes 1.0 6.0  8   8   
060290 - other 0.9 0.0 2       071410 - manioc (cassava) 0.9 6.0  1 1     210390 - other 0.9 0.0 3       720449 -- other 0.9 0.0 1       200949 -- other 0.9 6.0  1   1   392690 - other 0.8 6.0  8    7 1 
030429 -- other 0.8 0.0 8       401693 -- gaskets, washers and other seals 0.7 6.0  1   1   
040221 -- not containing added sugar or other 
sweetening matter 0.7 SPFP+0%b  4     4 
060491 -- fresh 0.6 6.0  1 1     151190 - other 0.6 0.0 1       721041 -- corrugated 0.6 0.0 1       Total of above 57.9 4.0 28 55 18 1 15 9 12 
a In 2013, this subheading has duty-free access at the MFN level. However, it includes tariff line 
1701.11.90.00 which is subject to the price band system. 
b Tariff lines subject to price band system.   
Note: Based on HS 2007 nomenclature. 
 Source: WTO estimates based on data provid ed by Peru and UNSD, Comtrade database. WT/REG342/1/Rev.1 
 
- 48 - 
 
 ANNEX 2 
TRQS UNDER THE AGREEMENT 
Party/Product Initial /Final Quota In-quota Rate Notes 
Costa Rica 
Bovine meat 
0201.10.00, 0201.20.00, 
0201.30.00, 0202.10.00, 
0202.20.00,y 0202.30.00 2013:899 MT  
as of 2022:1,200 MT Duty-free Annual increases of 23 MT, 
117 MT increase at last 
instalment. 
 
Peru 
Bovine meat 
0201.10.00.00, 
0201.20.00.00,  
0201.30.00.10, 
0201.30.00.90, 
0202.10.00.00, 
0202.20.00.00, 
0202.30.00.10, 
0202.30.00.90 2013:899 MT  
as of 2022:1,200 MT Duty-free Annual increases of 23 MT, 
117 MT increase at last 
instalment. 
 
MFN 2013: duty-free, MFN 
2014: 6% and 11%. 
Dairy products 
0402.91.10.00, 0402.99.10.00 2013:1,500 MT  
as of 2023:2,500 MT Duty-free Annual increases of 100 MT. 
 MFN 2013: duty-free; for products subject to the price-band system, duty-free only on the ad-valorem  part of the 
tariff. 
Food complements 
2106.90.79.00, 
2106.90.90.00 As of 2013: 3,200 MT Duty-free No annual increase. 
MT: metric tons.  Source: Annex 2.3, Appendix 1 to the Agreement. 
 
__________