WT/REG345/M/1  
 
31 October 2014  
(14-6331)  Page: 1/3  
Committee on Regional Trade Agreements 
Seventy-fourth Session    
 
FREE TRADE AGREEMENT BETWEEN MEXICO AND URUGUAY 
GOODS  
NOTE ON THE MEETING OF 23 SEPTEMBER 2014 
Chairman: Ambassador Francisco Pirez Gordillo (Uruguay) 
1.1.  The 74th Session of the Committee on Regional Trade Agreements (hereinafter 'CRTA' or the 
'Committee') was convened in Airgram WTO/AIR/4338 dated 11 August 2014. 
1.2.  Under Agenda Item B.IV of the session , the CRTA considered the Free Trade Agreement 
between Mexico and Uruguay, (hereinafter "the Agreement"). 
1.3.  The Chairman said that the Agreement had entered into force on 15 July 2004. It had been 
notified to the WTO by the Parties on 28 June 2013 under Article XXIV:7(a) of the GATT 1994 and 
the Understanding on the Interpretation of Article XXIV of GATT 1994 as an Agreement 
establishing a free trade area (document WT/REG345/N/1). The text of the Agreement was 
available, together with its Annexes, on the Partie s' official websites. The Factual Presentation on 
the goods aspects (document WT/REG345/1 dated 14 July 2014) and written questions and replies 
(documents WT/REG345/2 and WT/REG345/3 dated 17 and 19 September 2014, respectively) had 
been issued. He proposed to organize the consideration of the Agreement by first asking the Parties and then other Members to give any general comments. They would then turn to the specifics of the Agreement, using the Factual Pres entation to guide the debate. They would then 
go through the questions and replies document. 
1.4.  The representative of Uruguay said that in April, the WTO had published an interesting study 
(by Fontagné, Fouré and Keck) which concluded with  a probable scenario for the next couple of 
decades (until 2035) in which the importance of regional agreements as opposed to multilateralism 
in trade would tend to diminish. Despite this, in today's world, the clear trend was for countries to seek to secure access to world markets through either regional or bilateral arrangements, 
depending on the case. In this context, Uruguay's strategy of integration in international trade 
consisted of leaving all options open: on the one hand, it favoured the WTO multilateral sphere, but at the same time it had been focusing its efforts – subject to circumstances which he would discuss shortly – on negotiating other types of agreements. The circumstances which determined 
the scope within which Uruguay negotiated trade agreements related to its membership in 
MERCOSUR. Uruguay was a founding member of MERC OSUR, which to a certain extent limited the 
way in which it formulated specific trade policies which might be different from those decided on 
within MERCOSUR. MERCOSUR was a customs union und er construction, so that as a general rule, 
priorities in the area of trade negotiations were first negotiated within the bloc, and then jointly with third parties. In other words, in principle Uruguay did not negotiate agreements individually. 
1.5.  Thus, the priority that Uruguay gave to th e external market in its development strategy was 
linked to its conviction that MERCOSUR should be coupled with open regionalism on as broad a 
scale as possible. Having said this, Uruguay placed special emphasis on the signature and implementation of the Agreement with Mexico that  was being reviewed, since it was the first, and 
for the moment only agreement concluded by Uruguay on an individual basis. The Agreement 
should be seen as an exception, duly negotiated with its MERCOSUR partners. This exception or waiver had been accepted by MERCOSUR in view of the strategic significance of Uruguay's bilateral 
relationship with Mexico. Indeed, for Uruguay this had been an important lesson in the art of 
negotiating trade agreements at the individual level. WT/REG345/M/1 
 
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  1.6.  Turning to the Agreement itself, the FTA between Mexico and Uruguay, which had been in 
force since 2004, had brought about a significant in crease in bilateral trade. In terms of tariff 
reduction, the FTA had succeeded in extending already existing preferences, so that approximately 93% of tariffs were now free of restrictions. This opening was particularly noticeable in the 
industrial sector, where apart from a few exceptions, all tariffs had been fully liberalized. Trade 
rules and disciplines such as rules of origin, safeguards, unfair trade practices and so on were carefully regulated, while in the case of sanitary and phytosanitary measures and technical 
standards, the Agreement provided for cooperation mechanisms between the Parties to ensure 
that such measures did not create barriers to bilateral trade. 
1.7.  Turning briefly to concrete figures, in or der to appreciate the context of Uruguay's foreign 
trade, he recalled that in 2013 Uruguay's exports to the rest of the world reached a record 
US$10 billion. In 2013, using more up to date figures than those in the factual presentation, the 
main exports were soya, bovine meat, cereals, dairy products and cellulose. That same year, 
imports totalled a record US$9.5 billion, excluding petroleum and petroleum products. Uruguay 
and Mexico's overall trade had increased sharply from US$173 million in 2004, when the 
Agreement entered into force, to US$583 million in 2013. Breaking down this total, in 2013 Uruguay's exports to Mexico totalled US$284 million, while imports totalled US$299 million, 
leaving a deficit of about US$15 million. The trend of the past few years deviated from the trade 
patterns of the first decade of the 21st century, when Uruguay had had a bilateral trade surplus. 
In 2013, Mexico ranked 14th among Uruguay's export destinations, accounting for little more than 2% of total exports and about 3% of total im ports. This indicated that Uruguay had steadily 
increased its exports to the world over the past decade, while with Mexico, though there had been 
an increase it had been more irregular, not linear. Regarding trade between the Parties, Mexico's exports to Uruguay were chiefly medium high technology manufactured goods (goods vehicles, 
refrigerators, laminated goods, monitors and cars). Indeed, these five products accounted for 
80% of imports. Uruguay exported chiefly flavouri ngs and essences for drinks, followed by tanned 
hides and skin, leather articles, cheese, rice and w ood. Clearly, there was a difference in the added 
value of the products traded, since Uruguay provided Mexico with raw materials and manufactures 
based on primary goods. He concluded by saying that the FTA with Mexico represented a milestone 
in Uruguay's trade policy and its international integration efforts, not so only in terms of its purely commercial value, but also in terms of its strategic value, which had inspired Uruguay's quest for 
regional integration. 
1.8.  The representative of Mexico thanked the WTO Secretariat for preparing the factual 
presentation, the delegation of Uruguay for its coordination and the delegations of Thailand, the 
European Union and Peru for their expressions of interest in learning more about the Agreement. 
One of Mexico's priorities in recent years had been to strengthen its trade links with the Latin American and Caribbean region. This was reflected in its participation in the Pacific Alliance 
and ECLAC, as well as in the co nvergence and deepening of FTAs with Central American countries. 
The FTA with Uruguay was therefore a lynchpin in in creasing trade flows, with a view to fostering 
development for the benefit of both consumers an d economic operators in the two countries. The 
FTA had now become one of Mexico's most important trade instruments and was part of its linkage 
strategy in the region. Indeed, total bilateral tr ade had grown by 342.2% over the past ten years, 
rising from US$173 million in 2004 to US$592 million in 2013. 
1.9.  He highlighted some of the key features of the disciplines contained in the FTA. The 
provisions on rules of origin met the requirements of new generation agreements. They 
accordingly included clear rules and precise guidelines with a view to avoiding, as far as possible, any differences of interpretation between users and authorities in either country. In terms of 
customs procedures, the Agreement was a legal instrument that afforded users greater certainty 
and security in their trade operations and esta blished clear provisions to ensure its proper 
implementation and the effective granting of nego tiated preferences. Safeguard mechanisms were 
subject to a clear, transparent and time bound pr ocedure that ensured proper protection of the 
domestic industry in the event of serious injury or threat thereof, thus preventing measures of this 
type from being used for protectionist purposes. Rules and procedures to combat unfair practices in international trade had been laid down to make certain that trade remedies were applied in a 
transparent, justified and WTO–consistent manner.  For example, the FTA provided for interested 
parties in an investigation to be directly notified of the time-frames and place for submitting evidence, so as to respect the Parties' right of defence. The FTA afforded conditions of legal 
certainty and assurance for investors and their investments, under disciplines covering national 
treatment, most favoured nation treatment, unrestricted movement of transfers, and WT/REG345/M/1 
 
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  compensation in the event of expropriation. It  also prohibited the imposition of trade or 
investment distorting performance requirements. 
1.10.  In intellectual property, the Agreement in cluded provisions on international conventions, 
national treatment, exceptions to national tr eatment, most favoured nation treatment, and 
cooperation in eliminating trade in goods that infringe IPRs. The Parties had undertaken to adopt 
or maintain measures that prohibit anti-competitive behaviour, and to take appropriate action to that effect. The FTA established an effective mechanism for the prevention or settlement of 
disputes relating to the interpretation or application of the Agreement. Lastly, in 2013 a Protocol 
amending the FTA had been signed, which, inter alia, established annual quotas for powdered milk, modified the specific requirement of origin for lanolin, and introduced a provision on expanded cumulation of origin. He concluded by reiterating his delegation's readiness to expand on 
any point of interest that might arise. 
1.11.  The representative of Paraguay shared wi th Uruguay the joint vision of a wider MERCOSUR. 
His delegation considered this a noble effort in that regard.  The Agreement with Mexico had been 
looked at in terms of the MERCOSUR aspect which was important.  
1.12.  The representative of the European Union said that the EU supported economic and trade 
integration in the region.  The EU had already concluded an FTA with Mexico and was negotiating 
with MERCOSUR.  He thanked the Parties for their swift response to his delegation's questions. 
1.13.  The representative of the United States said that the US had strong economic relations with 
both parties, Mexico in particular. The U.S. had also done interesting bilateral work with Uruguay. 
His delegation was disappointed, however, by the coverage of agriculture in the Agreement, 
particularly in the case of Uruguay. Uruguay had liberalized only 46% of agricultural tariff lines and 
Mexico 77%. Overall the coverage of agriculture was quite low. He also drew attention to the long list of non-notified RTAs for both Parties and he repeated that to the extent that the 
LAIA agreements were individual RTAs with specific market access commitments his delegation 
was firmly of the view that each needed to be notified to the WTO. He did not see the need to belabour this point as that discussion had already been held. His delegation would like to see the 
issue resolved. 
1.14.  The representative of Mexico replied th at the non-notified RTAs referred to by the 
representative of the United States were in the context of the LAIA. Extensive internal discussions 
had been held regarding the notification of these Ag reements.  Mexico's position was to notify such 
agreements taking into account the views of its trading partners. 
1.15.  The Chairman said that consideration of  the Goods Aspects of the Free Trade Agreement 
between Mexico and Uruguay had allowed the Commi ttee to clarify a number of questions and it 
now concluded oral discussion of the RTA in accordance with paragraph 11 of the Transparency 
Mechanism. If any delegations wished to ask follow up questions they were invited to forward submissions in writing to the Secretariat by 30 September 2014 and Parties were asked to submit 
replies in writing by no later than 14 October 2014. In accordance with paragraph 13 of the 
Transparency Mechanism all written submissions, as well as minutes of the meeting would be circulated promptly, in all WTO official languages, and would be made available on the WTO website. 
1.16.  The Committee took note of the comments made. 
 
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