WORLD TRADE  
ORGANIZATION  WT/REG212/3 
WT/REG213/3 
WT/REG214/3 
8 September 2009 
 
 (09-4268) 
Committee on Regional Trade Agreements Original:   English/ 
 Spanish  
 
  
FREE TRADE TREATY BETWEEN MEXICO AND THE NORTHERN 
TRIANGLE – EL SALVADOR, GUATEMALA AND HONDURAS 
(GOODS AND SERVICES) 
 
Questions and Replies
 
   The following communication, dated 8 September 2009, is being circulated at the request of 
the delegations of Mexico and the Northern Triangle, El Salvador, Guatemala and Honduras. 
  This document reproduces the questions addressed to the Parties and the responses submitted.  
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Questions from the delegation of Australia
 
 
1. We note that Mexico's tariff schedule contains 11,265 tariff lines with imports under 
17 lines prohibited.  What are the prohibited lines and why are they banned? 
 The prohibition on the importation of the products referred to in the Treaty's Tariff 
Elimination Programme is also provided for in the Tariff of the Law on General Import and Export 
Taxes which Mexico applies to third parties.  Mexico applies these measures for reasons of public 
safety, health and morals.  
 The prohibited products are liste d in Table I, annexed hereto. 
 
2. We note that Guatemala has import price requirements on HS 0207.  What is the price 
requirement and how does it work? 
 Guatemala has stopped applying minimum va lues for valuation purposes for products under 
heading 0207, in compliance with the schedul e established by the WTO Customs Valuation 
Committee in its Decision of 5 December 2001 (G/VAL/43). 
 
Questions from the delegation of Brazil
 
 
3. Regarding the FTA between Mexico and the Northern Triangle - Guatemala, Honduras 
and El Salvador (WT/REG214/2), we would apprec iate to receive further information about the 
possibility of diagonal cumulation, especially between the Parties, the US and CAFTA;  and between the Parties and other countries of Central America. 
 This question is being revised and will be answered shortly. 
 WT/REG212/3 
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  4. Are the preferences granted for goods prod uced with materials imported with 
suspension or elimination of duties and taxes? 
 The preference established in the Treaty is a pplied to products, imported from Party countries, 
which comply with the provisions of Chapter VI (Rules of Origin) of the Treaty. 
 
5. Are there any plans to implement digital certificates of origin, with digital signature? 
 The Free Trade Treaty between Mexico and the Northern Triangle does not contain any 
provisions on the use of digital certificates of origin  with digital signature.  This does not, however, 
prevent the Parties from using such a mechanism, subject to agreement. 
Questions from the delegation of the European Communities
 
 
Liberalization of trade and tariff lines  
 
6. After entry into force in 2001 the yearly tari ff elimination commitments are particularly 
important in the period 2009-2010 with total liberalization to be completed by Mexico in 17.5 per cent of its imports from Guatemala (i n value) and 36 per cent of its imports from 
Honduras.  Complete liberalization will be also achieved in 2009-2010 for significant percentage 
of Mexico's exports to Guatemala (16 per cent), Honduras (20 per cent) and El Salvador (16.7 per cent) in the period 2009-2010. 
 Could the Parties confirm that the impl ementation of the Agreement proceeds as 
foreseen and that comparably sizeable trad e flows will achieve duty-free regime during 
2009-2010? 
 
 The Parties can confirm that this is so.  Im port tariff elimination is proceeding in accordance 
with the corresponding tariff elimination programme.  During the period 2009-2010, 97 per cent of 
Mexico's Tariff is to become duty free.  See the in formation provided in reply to the question below. 
 
7. Charts I.3 and I.4, included in the 'Trade Environment' chapter and based on 
COMTRADE database, show as much as a five-fold increase in the value of imports of Mexico from the Northern Triangle between the yea rs 2000–2007, and a two-fold increase in its exports 
during the same period.  However the percent age of tariff elimination commitments by the 
Parties is measured (cf. tables III.1A, B, C and D) only by reference to the value of trade during 
the period 1998-2000. 
 Could the Parties provide some indications based on more recent bilateral trade data 
regarding the percentage of trade in value which remains dutiable in each of the six possible 
trade directions under the Agreement?  
 See the tables annexed hereto.   WT/REG212/3 
 WT/REG213/3 
 WT/REG214/3 
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  Rules of origin
 
 
8. What are criteria and legal basis for determination of origin, certification requirements 
and customs control procedures in relation to  materials originating or manufacturing or 
processing operations performed in the US or other countries (non-Parties to the Agreement) 
with which diagonal cumulation is allowed? 
 See the reply to question 3 posed by Brazil. 
 
 It is the cumulation clause of the Free Tr ade Agreement between the United States and the 
Dominican Republic, Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua (DR-CAFTA) 
that applies.  This clause provides that a Central American clothing producer may use textile materials 
of Mexican origin in its production process and yet still obtain the tariff preference under the Free 
Trade Agreement.  This preference is limite d to a certain quota of articles of clothing. 
 
 The Customs Cooperation Agreement between  Mexico and the United States allows: 
 
(a) Mexican customs authorities to verify the or igin of textile materials produced in the 
United States and incorporated into articles of clothing assembled in Central America, for which the preferential treatment provided for in the cumulation annexes 
of the Free Trade Agreements with Central America has been requested;  and 
(b) US customs authorities to verify the origin  of textile materials produced in Mexico 
and incorporated into articles of clothing assembled in Central America, for which the preferential treatment provided for in  the DR-CAFTA has been requested. 
Trade in services and investment
 
 
9. Paragraph 150 of the Factual Presentation indicates that, with respect to Honduras, 
"[h]orizontal commitments under the GATS including a ceiling on the number of foreign workers in an enterprise, a limitation on foreign investment on grounds of its impact on local 
economic activity and employment and of its contribution to the training of Honduran 
personnel in their respective a reas of expertise, have been lifted under the Treaty". 
 Could Honduras confirm whether the above- referred statement reflects the overall 
future RTA trade policy of Honduras in the areas of restrictions in the number of workers?  If 
this were not the case, could Honduras explain the reasons for having granted this concession to 
Mexico? 
  The statement referred to by the European Communities appears in the factual presentation 
prepared by the WTO Secretariat on its own responsibility and cannot therefore be attributed to a policy of Honduras.  Nevertheless, this concession is a result of the negotiation process between Honduras and Mexico within the frame work of the Free Trade Treaty. 
 
10. Table IV.1 lists the existing non-conforming me asures in Mexico.  It is indicated that in 
all sectors, "[p]ermission by the National Co mmission on Foreign Investment (NCFI) is 
required for investment above 49 per cent by foreign investors.  From 2003, the threshold for investors from the Northern Tr iangle is increased annually". WT/REG212/3 
WT/REG213/3 WT/REG214/3 
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   Could the Parties elaborate on the reasons for maintaining the existing restrictions of 
ownership for Central American countries in Mexican firms if full liberalization is envisaged at a certain stage? 
 
 Under the Mexican regulatory framework, Article  9 of the Foreign Investment Law provides 
that the approval of the National Commission on Fore ign Investment is required for foreign investors 
to acquire, directly or indirectly, more than 49 pe r cent of a company's capital stock, only when the 
total value of the assets of the targeted company,  at the time of submitting the acquisition request, 
exceeds a threshold amount established annually by the Commission. 
  The above is reflected in our reservations in this and other Treaties.   It should be noted that the approach adopted  for negotiation in respect of the chapter on 
cross-border trade in services is the negative list approach, which means that the various activities 
making up the services sector have been liberali zed, except as indicated in Mexico's list of 
reservations.  This chapter also provides for a ratc het clause which means that if Mexico liberalizes 
certain services unilaterally, such  liberalization is bound, and may not subsequently be reversed by 
Mexico.  Question from the delegation of Japan
 
 
11. The last sentence of paragraph 121 says that  the Party refusing to issue an immigration 
document must give in writing, to the business person, the reasons for the refusal and promptly notify these reasons to the other Party in wr iting.  Japan would like to know whether the 
refusing Party must notify every individual refused  case to the other Party in writing one by 
one, or not. 
 Immigration permit refusals will be notified on a case by case basis.  Permits will be refused 
only on the grounds set forth in paragr aph 2(a) and (b) of Article 13.04. 
  Article 13.04 (Temporary Entry Authorization) of the Free Trade Treaty between Mexico and 
the Northern Triangle, provides that: 
 1. Pursuant to….  2. A Party may refuse to issue an immigration document authorizing employment to a business 
person where the temporary entry of that person might adversely affect: 
 
(a) The settlement of any labour dispute that is  in progress at the place or intended place 
of employment;  or 
(b) the employment of any person who is involved in such dispute. 
3. When, pursuant to paragraph 2, a Party refuses to issue an immigration document authorizing 
employment, it shall: 
 
(a) Inform the business person in writing of the reasons for the refusal;  and 
(b) promptly notify, in writing, the Party who se business person has been refused entry of 
the reasons for the refusal.  WT/REG212/3 
 WT/REG213/3 
 WT/REG214/3 
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  ANNEXES 
 
Table I
 
Mexico's Tariff Elimination Programme  
Prohibited imports  
 
 
Heading 1 Description 
03019901 Predators, in young, youth and adult states 
12119002 Marijuana (Cannabis Indica) 
13021102 Prepared for smoking 
13021902 Of marijuana (Cannabis Indica) 
28332903 Thallium sulphate 
29035903 1,2,3,4,10,10-Hexachloro-1,4,4a,5,8,8a-hexahydro-endo-endo-1,4:5,8-dimethanonaphthalene 
29035905 1,4,5,6,7,8,8-Heptachloro-3a,4,7,7a, tetrahydro-4,7-methanoindene 
29109001 1,2,3,4,10,10-Hexachloro-6,7-epoxy- 1,4,4a,5,6,7,8,8a-octahydro-endo,endo-1,4:5,8- 
dimethanonaphthalene 
29251901 N-Phthalyl glutamic acid imide 
29310005 O-(2,5-dichloro-4-bromophenyl) o-methyl phenyl thiophosphonate 
29391002 Diacetylmorphine 
30034001 Preparations of Cannabis Indica  
30034002 Preparations of acetyl morp hine or its salts and derivatives 
30044001 Preparations of acetyl morp hine or its salts and derivatives 
30044002 Preparations of Cannabis Indica 
49089005 Printed in colour or black and white, put up for sale in envelopes or packages, whether or not 
containing chewing gum, candies or any other type  of article, featuring figures or illustrations 
which depict childhood in a degrading or ridiculous manner, in states that may incite violent, 
self-destructive or any other form of anti-social behaviour, for example "Garbage Pail Kids", 
and marked as having been printed in the USA or in any other country by "Topps Chewing Gum Incorporated" or by any other trading enterprise 
49119105 Printed in colour or black and white, put up for sale in envelopes or packages, whether or not 
containing chewing gum, candies or any other type  of article, featuring figures or illustrations 
which depict childhood in a degrading or ridiculous manner, in states that may incite violent, 
self-destructive or any other form of anti-social behaviour, for example "Garbage Pail Kids", 
and marked as having been printed in the USA or in any other country by "Topps Chewing Gum Incorporated" or by any other trading enterprise  
 
 
 
    
 
    WT/REG212/3 
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Table III.1A – Mexico
 
 
Tariff elimination commitments under the Treaty  
and corresponding average trade  
 
 
Number of lines % of total lines in 
Mexico's tariff 
schedule Value of Mexico's 
imports 
(2004-2006) 
(in US$ million) % of Mexico's total 
imports 
(2004-2006) 
Duty 
phase-out 
period 
El Salvador 
Guatemala 
Honduras 
El Salvador 
Guatemala 
Honduras 
El Salvador 
Guatemala 
Honduras 
El Salvador 
Guatemala 
Honduras 
MFN duty-
free (2001) 152 152 152 1.3 1.3 1.3 0.4 34.3 0.0 0.7 12.9 0.0 
2001 9,077 9,095 7,979 80.6 80.7 70.8 36.9 125.5 25.6 66.9 47.2 27.4 
2004 112 131 134 1.0 1.2 1.2 4.1 9.1 0.9 7.5 3.4 1.0 
2005 418 259 312 3.7 2.3 2.8 9.3 7.4 4.7 16.9 2.8 5.0 
2006 12 16 1,218 0.1 0.1 10.8 0.0 0.3 17.0 0.1 0.1 18.2 
2007 794 955 799 7.0 8.5 7.1 2.2 17.6 1.1 4.0 6.6 1.2 
2008 36 16 43 0.3 0.1 0.4 0.0 1.6 0.0 0.0 0.6 0.0 
2009 362 327 327 3.2 2.9 2.9 1.6 34.3 43.8 2.9 12.9 46.9 
2010 23 29 26 0.2 0.3 0.2 0.0 9.6 0.0 0.0 3.6 0.0 
Remain 
dutiable 279 285 275 2.5 2.5 2.4 0.5 26.3 0.2 1.0 9.9 0.2 
Total 11,265 11,265 11,265 100.0 100.0 100.0 55.2 266.0 93.4 100.0 100.0 100.0
 
Note: No import data;  excludes data beyond HS Chapter 97. 
 
Source:  WTO Secretariat based on data provided by Mexico and WTO IDB. 
  WT/REG212/3 
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  Table III.1B - El Salvador
 
 
Tariff elimination commitments under the Treaty and corresponding average trade  
 
 
Duty phase-out 
period Number of lines % of total lines in 
El Salvador's tariff 
schedule Value of El 
Salvador's imports 
from Mexico 
(2004-2006) 
(in US$ million) % of El Salvador's 
total imports from 
Mexico (2004-2006)
MFN duty-free 
(2001) 2,812 47.0 164.5 32.9 
2001 540 9.0 112.4 22.5 
2002 21 0.4 27.4 5.5 
2003 2 0.0 0.1 0.0 
2005 781 13.0 23.4 4.7 
2006 4 0.1 0.0 0.0 
2007 419 7.0 11.1 2.2 
2008 124 2.1 21.4 4.3 
2010 720 12.0 85.2 17.0 
2011 310 5.2 34.2 6.8 
2012 32 0.5 1.9 0.4 
Remain dutiable 224 3.7 18.8 3.8 
Total 5,989 100.0 500.4 100.0 
 
Note: Calculations exclude im port data under HS Chapter 98. 
 
Source:  WTO Secretariat based on data provi ded by El Salvador and WTO IDB. 
 WT/REG212/3 
WT/REG213/3 WT/REG214/3 
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  Table III.1C – Guatemala
 
 
Tariff elimination commitments under the Treaty  
and corresponding average trade  
 
 
Duty phase-out 
period Number of lines % of total lines 
in Guatemala's 
tariff schedule Value of Guatemala's 
imports from Mexico 
(in US$ million) % of Guatemala's 
total imports from 
Mexico 
MFN duty-free 
(2001)  3,270 54.6 263.21 70.2 
2002  20 0.3 - - 
2003  5 0.1 0.7 0.2 
2004  6 0.1 23.4 6.4 
2005  793 13.2 0.6 0.2 
2006  4 0.1 3.3 0.9 
2007  443 7.4 8.8 2.4 
2008  93 1.6 65.0 17.7 
2009  1 0.0 0.2 0.1 
2010  750 12.5   
2011  289 4.8   
2012  40 0.7   
Remain dutiable  271 4.5 10.0 2.7 
Total  5,985 100.0 375.2 100.0 
 
Source : Ministry of the Economy of Guatemala.  WT/REG212/3 
 WT/REG213/3 
 WT/REG214/3 
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  Table III.1D – Honduras
 
 
Tariff elimination commitments under the Treaty  
and corresponding average trade  
 
 
Duty phase-out 
period Number of lines % of total lines in 
Honduras' tariff 
schedule Value of Honduras' 
imports from Mexico 
(2004-2006) 
(in US$ million) % of Honduras' 
total imports 
from Mexico 
(2004-2006) 
2001 3,941 54.5 130.2 53.2 
2002 3 0.0 0.1 0.1 
2003 4 0.1 0.7 0.3 
2005 372 5.1 10.0 4.1 
2006 625 8.6 1.8 0.7 
2007 74 1.0 0.2 0.1 
2008 558 7.7 15.5 6.3 
2010 875 12.1 56.8 23.2 
2011 137 1.9 3.0 1.2 
2012 209 2.9 10.9 4.5 
Remain dutiable 436 6.0 15.7 6.4 
Total 7,234 100.0 245.0 100.0 
 
Note: Calculations exclude im port data under HS Chapter 99. 
 
Source:  WTO Secretariat based on data provided by Honduras. 
 
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