WORLD TRADE  
ORGANIZATION  WT/REG218/2/Rev.1 
22 October 2010 
 (10-5514) 
Committee on Regional Trade Agreements  
  
 
  
 
 
FACTUAL PRESENTATION 
 
Free Trade Treaty between 
Costa Rica and Mexico 
(Goods and Services) 
 
Report by the Secretariat 
 
Revision 
 
 
 
 
This report, prepared for the consideration of the Free Trade Treaty between Costa Rica and Mexico, has been drawn up by the WTO Secretariat on its own responsibility and in full consultation with the Parties.  The report has been drawn 
up in accordance with the rules and pro cedures contained in the Decision for a 
Transparency Mechanism for Regi onal Trade Agreements (WT/L/671). 
 
Any technical questions arising from this report may be addressed to Maria Pillinini (Tel.:  +41 22 739 52 44).  WT/REG218/2/Rev.1 
 Page iii 
 
 
  TABLE OF CONTENTS 
 
  Page 
 
I. TRADE ENVIRONMENT ........................................................................................................... .........1 
 A. O VERVIEW ............................................................................................................................... ...1 
 B. M ERCHANDISE TRADE ................................................................................................................1 
 C. T RADE IN SERVICES ....................................................................................................................6 
II. CHARACTERISTIC ELEME NTS OF THE TREATY...................................................................10 
 A. B ACKGROUND INFORMATION ...................................................................................................10 
III. TRADE IN  GOODS ............................................................................................................ .................12 
 A. N ATIONAL TREATMENT AND MARKET ACCESS PROVISIONS ON TRADE IN GOODS ..................12 
 1. Import duties and charges, and quantitative restrictions............................................12 
 (a) General provisions.......................................................................................12  (b) Liberalization of ta riff lines and trade .........................................................14 
 (c) Tariff-ra te quotas.........................................................................................17 
 (d) Costa Rica's libe ralization sc hedule ............................................................17 
 (e) Mexico's libera lization schedule..................................................................21 
 2. Rules of origin ...........................................................................................................2 4 
 3. Export duties and charges,  and quantitative restrictions............................................26 
 B. R
EGULATORY PROVISIONS ON TRADE IN GOODS ......................................................................27 
 1. Standards .................................................................................................................. .27 
 (a) Technical barri ers to trade ...........................................................................27 
 (b) Sanitary and phyt osanitary measures...........................................................28 
 2. Safeguard mechanisms ..............................................................................................28  (a) Global safeguards........................................................................................28 
 (b) Bilateral safeguards .....................................................................................29 
 3. Anti-dumping and c ountervailing measures ..............................................................29 
 4. Subsidies and State aid ..............................................................................................30 
 5. Customs-related procedures.......................................................................................30 
 6. Sector-specific provisio ns on trade in goods .............................................................32 
 (a) Agricultura l products...................................................................................32 
 (b) Textile s products .........................................................................................32 
IV. TRADE IN SERVICES AND INVESTMENT ..................................................................................33 
 A. S
COPE AND DEFINITIONS ..........................................................................................................33 
 B. D ENIAL OF BENEFITS ................................................................................................................34 
 C. G ENERAL PROVISIONS ON TRADE IN SERVICES ........................................................................34 
 1. Market  access ............................................................................................................34  
 2. National and MFN treatment .....................................................................................35  3. Local presence ...........................................................................................................35  
 4. Movement of natural persons ....................................................................................35 
 5. Performance requirements .........................................................................................36  6. Requirements for senior manage ment and board of directors....................................37 
 7. Other investme nt provisions ......................................................................................37 
 D. L
IBERALIZATION COMMITMENTS .............................................................................................37 
 1. Cost a Rica................................................................................................................. .37 
 2. Mexico,......................................................................................................................41 
E. R EGULATORY PROVISIONS ON TRADE IN SERVICES ................................................................................46 
 1. Domestic regulation...................................................................................................46 
 2. Reco gnition................................................................................................................ 46 WT/REG218/2/Rev.1 
Page iv  
 
  V. GENERAL PROVISIONS  OF THE TREATY.................................................................................47 
 1. Transparency .............................................................................................................47  
 2. Current payments and capital movements .................................................................47 
 3. Exceptions ................................................................................................................. 47 
 4. Accession.................................................................................................................. .48 
 5. Institutiona l framework..............................................................................................48 
 6. Dispute settleme nt .....................................................................................................48 
 7. Relationship with other agreem ents concluded by  the Parties...................................50 
 8. Government procurement ..........................................................................................53 
 9. Intellectual pr operty rights.........................................................................................54 
ANNEX I ........................................................................................................................ .....................................56 
ANNEX II....................................................................................................................... .....................................63 
ANNEX III ...................................................................................................................... ....................................67 
 
 
 
  WT/REG218/2/Rev.1 
 Page 1 
 
 
   
Basic data 
 
Parties to the Treaty:   Costa Rica and Mexico 
 
Date of signature:   5 April 1994 
 Date of entry into force:   1 January 1995 
 Date of notification:  17 July 2006 
 
 
I. TRADE ENVIRONMENT 
A. OVERVIEW  
1. The Free Trade Treaty between Costa Rica and Mexico (hereinafter the "Treaty") is 
Costa Rica's fourth regional trade agreement (R TA) notified to the WTO (following agreements with 
Chile, Canada and the United States and the Domi nican Republic under the CAFTA-DR Agreement).  
It is Mexico's sixth bilateral agreement with a La tin American country notified to the WTO (following 
those with Chile, Nicaragua, and El Salvador, Guatemala and Honduras).  This Treaty however 
predates all of the above-mentioned agreements, having entered into force on 1 January 1995. 
2. In 2007, Costa Rica's GDP was estimated at  US$25,225 million, and that of Mexico at 
US$893,364 million.  In the same year, Costa Rica ranked 80th in terms of both world exports and 
imports;  its total merchandise exports amounted to US$9,337 million, representing 0.07 per cent of 
global exports, while imports amounted to US$12,95 2 million and represented 0.09 per cent of global 
imports.  Mexico ranked 15th among world exporters of goods and 14th among world importers.  Its 
merchandise exports amounted to US$271,821 milli on (1.94 per cent of global exports), while its 
imports amounted to US$295,201 million (represen ting 2.07 per cent of global imports).  The 
structure of their merchandise exports and imports is  very similar;  manufactures are the most traded 
commodity, followed by fuel and mining products, and agricultural goods.1 
3. With regard to services, Costa Rica was the 69th largest exporter and 96th largest importer in 
2007, with total exports of US$3,598 million and im ports of US$1,799 million (representing a share 
of 0.11 per cent and 0.06 per cent of world exports  and imports, respectively).  In the same year, 
Mexico ranked 36th and 33rd as regards world exports and imports  of commercial services, exporting 
US$17,647 million and importing US$23,231 million (r espectively 0.53 per cent and 0.74 per cent of 
world exports and imports).  The Parties' overall trade-to-GDP ratio s are considerably different, 105.1 
for Costa Rica (2005-2007) and 64.5 for Mexico (2005-2007).2 
B. MERCHANDISE TRADE  
4. In 2008, Costa Rica was Mexico's 18th largest export destination and 31st largest source of 
imports, accounting for 0.3 per cent of its total e xports and imports.  Mexico was Costa Rica's 
                                                      
1 WTO Statistics Database, Trade Profiles (April 2009). 
2 WTO Statistics Database, Trade Profiles (April 2009). WT/REG218/2/Rev.1 
Page 2  
 
  11
th largest merchandise export market, with 2.7 per cent of its total exports, and its second largest 
merchandise import source, accounting for 6.2 per cent of its total imports.3,4 
5. Developments in global and intra-Party me rchandise trade during the period 1992-2008 are 
shown in Charts I.1 (Costa Rica) and I.2 (Mexico).  Costa Rica has run a constant trade deficit in its 
global and bilateral trade since 1992, with the exception of 1999 when its exports to the world 
exceeded its imports.  By the end of the tenth year of implementation of the Treaty (2004), 
Costa Rica's imports from and exports to Mexico ha d grown annually by an average of 9 per cent and 
27 per cent, respectively.  The annual growth ra te over the period 1995-2008 was 14 per cent for 
imports and 24 per cent for exports. 
 
 
6. Mexico has experienced a slight but constant trade deficit with the world since 1997;  with 
Costa Rica, it moved from being a net exporter to a net importer in 2002.  By the end of the tenth year of the Treaty's implementation (2004), Mexico's imports from and exports to Costa Rica had grown annually by 49 per cent and 9 per cent, respectiv ely.  The annual growth rate over the period 
1995-2008 was 35 per cent for imports and 15 per cent for exports. 
 
                                                     
 
3 United Nations Statistics Division (U NSD), Comtrade database (2008). 
4 There are discrepancies between the figures for exports from Costa Rica to Mexico and for imports 
from Costa Rica notified by Mexico because of the logistics of Costa Rican exporting enterprises, which 
consolidate products in the US, from  where they are then redirected to  other markets, including Mexico.   
0   2   4   6   8   10   12   14   16   18   20   
1992   1993   1994   1995 1996   1997   1998 1999 2000 2001 2002 2003 2004 2005   2006   2007   20080.00.20.40.60.81.01.21.41.61.82.0US$ billion    US$ billionChart I.1  -  Costa Rica:  merchandise imports from and exports to 
world and Mexico, 1992  - 2008    
Source:   UNSD, Comtrade database.  
Imports from Mexico
Exports to MexicoTotal imports    
Total exports    Left - hand scale:    Right - hand scale: WT/REG218/2/Rev.1 
 Page 3 
 
 
  050100150200250300350
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080.00.51.01.5US$billion US$billionChart I.2 - Mexico:  merchandise imports from and exports to world 
and Costa Rica, 1992-2008
Source:  UNSD, Comtrade database.Imports from Costa Rica
Exports to Costa RicaTotal imports
Total exportsLeft hand scale: Right hand scale:
 
 
7. The commodity structure of trade between the Par ties, as well as of their imports and exports 
to the world before the entry into force of the Treaty (1992-1994) and during the most recent period 
for which data are available (2006-20 08) is shown in Charts I.3.A and I.3.B, respectively, on the basis 
of Harmonized System (HS) sections.  The figures show, for Costa Rica in particular, a significant change in the structure of trade, both globally as well as with Mexico. 
8. In 1994, Costa Rica's four largest import categories from the world were machinery, 
chemicals, vehicles and minerals, which accounted  respectively for 19.9 per cent, 14.1 per cent, 
9.6 per cent and 9.3 per cent (together accounting for 52.9 per cent) of its to tal imports.  Minerals, 
chemicals and machinery were also its three la rgest imports from Mexico, accounting for 67.3 per 
cent of total imports.  Vegetable products accounted for half of Co sta Rica's global exports (51.1 per 
cent), followed by food preparations (7.9 per cent) and animal products (6.7 per cent).  During the period 1992-1994, Mexico's top import categories from the world were machinery (33.8 per cent), and 
base metals and related articles (8.8 per cent).  In contrast, its imports from Costa Rica were fats and 
oils (36.3 per cent), textiles (18.5 per cent) and m achinery (11.3 per cent).  Machinery also accounted 
for 36.9 per cent of Mexico's global exports, followe d by mineral products (15 per cent) and vehicles 
(13.7 per cent). 
 WT/REG218/2/Rev.1 
Page 4  
 
  Chart I.3.A
Costa Rica and Mexico:  product composition of m erchandise trade, annual 
average (1992-1994*)
Costa Rica's imports from Mexico Mexico's imports from Costa Rica
* Mexico (average trade 1992-1994); Costa Rica (1994 trade).
Source:  UNSD, Comtrade database.Per cent
Total:  US$137 million Total:  US$20 million
Total:  US$3,024 million
Total:  US$2,220 millionCosta Rica's global exportsMexico's global exportsCosta Rica's global imports Mexico's global importsOther
4.9
Prepared foods 3.7Other 
9.9
Base metals 2.2
Other 
10.4Minerals
33.1
Plastics 9.1
Base metals 2.6Vegetables
51.1Textiles 4.0
Chemicals 4.5Textiles 
4.4Plastics 4.1Vehicles 3.7
Other 
12.0Vegetables 5.8
Chemicals
 14.1
Base metals 
8.4Pulp of wood 7.9Miscellaneous 2.9
Machinery 3.3 Prepared foods 3.5
Plastics 7.2Machinery 
19.9
Vehicles
 9.6Machinery 16.4Pulp of wood 4.6Chemicals 4.8
Pulp of wood  1.6
Animal products
6.7Other 
9.3
Vehicles
 10.1Base metals 
8.4Plastics 8.0Machinery 
38.8Other 
9.3
Vehicles
 10.1Base metals 
8.4Plastics 8.0Machinery 
38.8Other 
14.8
Vegetable 3.5
Textiles 5.0
Chemicals 
6.6Base metals 
8.8
Plastics
 6.7Minerals 2.7Machinery 
33.8
Vehicles 4.4Pulp of wood 3.8
Minerals 15.0Optical  2.3
Machinery
36.9
Chemicals 4.0
Textiles 4.3Plastics 2.8Other 
6.8
Base metals 5.6 
Vehicles  
13.7Miscellaneous 2.9
Vegetable 4.0Prepared foods 1.7Total:  US$68,844 million
Total:  US$52,900 millionFats and oils  
36.3
Prepared foods 
7.9Optical 3.1Chemicals 17.8
Minerals 9.3
Precious stones 1.7Textiles 18.5Machinery 11.3Animal products 
7.5Plastics 6.6
Animal products 2.5Prepared foods 2.2Miscellaneous 2.0Base metals 3.5Textiles 3.1
 
  WT/REG218/2/Rev.1 
 Page 5 
 
 
   
Chart I.3.B
Costa Rica and Mexico:  product composition of m erchandise trade, annual 
average (2006-2008)
Costa Rica's imports from Mexico Mexico's imports from Costa Rica
 Source:  UNSD, Comtrade database.Per cent
Total:  US$752 million Total:  US$768 million
Total:  US$13 billion
Total:  US$8.6 billionCosta Rica's global exportsMexico's global exportsCosta Rica's global imports Mexico's global importsOther
5.2
Machinery  
20.1 Stone, cement 3.0Other 
4.4
Miscellaneous 2.1
Other 
5.7Chemicals 
19.7Plastics 7.7
Animals 2.1
Machinery
32.5Vegetable 4.8
Chemicals 5.3Textiles 3.3Base metals 
19.2
Plastics 4.5Vegetables 2.3
Other 
7.5Prepared foods 3.5
Chemicals
 10.9Base metals 
7.7Plastics 7.1Base metals 3.5
Pulp of wood 9.1
Base metals 3.8 Textiles 3.7Raw Hides 4.2
Vehicles 5.2Machinery 
32.5
Minerals
 11.2Vehicles 4.5
Pulp of wood 4.9Prepared foods 6.9 Fats and oils
 12.9
Pulp of wood  1.9
Vegetable
 22.0Prepared foods
7.6Other 
9.3
Vehicles
 10.1Base metals 
8.4Plastics 8.0Machinery 
38.8Other 
9.3
Vehicles
 10.1Base metals 
8.4Plastics 8.0Machinery 
38.8Other 
7.8
Pulp of wood 2.3
Vehicles
 9.7Chemicals 7.5
Base metals 
8.9Minerals 8.1Optical 4.3Machinery 
36.5
Plastics 7.1Vegetables 2.8
Minerals 16.8Optical  3.4Machinery
37.8Chemicals 2.9Textiles 2.8Vegetables 2.5Other 
4.8
Base metals 5.5 
Vehicles  
16.0Miscellaneous 2.9Plastics 2.4Prepared foods 2.4Total:  US$282 billion
Total:  US$271 billionTextiles 2.3
Machinery  
69.4
Optical 2.7
Optical  9.5Textiles 3.1Plastics 1.7Animals 1.7
Miscellaneous 2.0
 WT/REG218/2/Rev.1 
Page 6  
 
  9. Over the last ten years, Costa Rica's Trade Policy Reviews (TPRs) have signalled both a 
significant shift in its export structure and a sharp export expansion, largely based on an export-oriented strategy supported by tariff and ot her fiscal concessions.  In this context, the 
importance of the free zone regime - Costa Rica 's most important export promotion scheme, 
accounting in 2005 for just over half of its exports of goods - has been underlined.
5  As a result, there 
has been an expansion in exports of electronic components and a loss of momentum in  agricultural 
exports6;  agricultural exports to the world fell from around 67 per cent of total merchandise imports 
in 1992-1994 to 33 per cent in 2006-2008.  The changes to its structure of exports are reflected in Chart I.3.B, with machinery being the largest e xport category in 2006-2008 (32.5 per cent), followed 
by vegetables (22 per cent).  This change is also re flected in Mexico's imports from Costa Rica, with 
machinery accounting for 69.4 per cent of total imports in 2006-2009. 
10. Costa Rica's three largest imports from the worl d were machinery and minerals, the shares of 
global imports of which increased to 32.5 per cen t and 11.2 per cent, respectively, and chemicals 
(10.9 per cent).  Mexico's top three import categories from the world continued to be machinery (36.5 per cent) and minerals (9.7 per cent), while vehicles, aircraft and vessels accounted for 8.9 per 
cent.  On the export side, machinery and minerals made up half of Mexico's  global exports (54.6 per 
cent), followed by vehicles (16 per cent). 
C. T
RADE IN SERVICES  
11. Chart I.4 shows the breakdown of commercial services trade for Costa Rica in 2000-2008.  
Total exports of commercial services decreased betw een 2000 and 2002, but have since risen steadily.  
On average, during 2000-2008, travel services account ed for more than 60 per cent of Costa Rica's 
total exports;  other important sectors were transp ortation, computer and information, and other 
business services.  Transport and travel services also  accounted for 69.5 per cent of Costa Rica's total 
imports.  Imports of commercial services decreased in 2001, but have increased since then, albeit less 
rapidly than exports. 
 
                                                      
5 See document WT/TPR/S/180/Rev.1 of 2 August 2007, paragraph 8 of Section III:1.  In 1999, exports 
from free zones represented 53.5 per cent of total exports of goods, and in 1995 only 13 per cent.  See document WT/TPR/S/83 of 9 April 2001, paragraph 137 of Section III:3(ix). 
6 See document WT/TPR/S/83 of 9 April 2001, paragraphs 1 and 5 of the "Summary observations".  WT/REG218/2/Rev.1 
 Page 7 
 
 
  0.00.51.01.52.02.53.03.54.04.55.0
2000 2001 2002 2003 2004 2005 2006 2007 20080.00.51.01.52.02.53.03.54.04.55.0
2000 2001 2002 2003 2004 2005 2006 2007 2008Chart I.4
Costa Rica:  total commercial services trade, 2000-2008
Exports Imports
Transport services
Travel services
Source :  Banco Central de Costa Rica.Telecommunications servicesUS$ billion
Financial services
Computer and information services
Royalties and license feesOther business services
Personal and cultural and 
recreational servicesUS$ billion
 Insurance services Government services
 
 
12. Chart I.5 shows the breakdown of commercial services trade for Mexico in 1999-2007.  
Exports fluctuated during the period 1999-2003, but have increased constantly since then.  Imports 
have increased steadily since 2002.  On average, dur ing 1999-2007, travel services accounted for the 
bulk of Mexican exports (70 per cent), followed by transport services and telecommunications services.  On the import side, insurance, travel and transport services accounted for 84.5 per cent of total imports. 
 WT/REG218/2/Rev.1 
Page 8  
 
  0510152025
1999 2000 2001 2002 2003 2004 2005 2006 20070510152025
1999 2000 2001 2002 2003 2004 2005 2006 2007Chart I.5
Mexico:  total commercial services trade, 1999-2007
Exports Imports
Transport services
Travel services
Source :  IMF, BOP CD-Rom.Telecommunications servicesUS$ billion
Financial services
Government services Royalties and license feesOther business services
Personal and cultural and recreational 
servicesUS$ billion
 Insurance services
 
 
13. Chart I.6 shows Costa Rica's net flow of FDI from Mexico and the world in the period 
2000-2008.  The net inflow of FDI from Mexico was erratic over the period surveyed;  it more than 
doubled in 2007 compared with the previous year, reaching US$63.8 million, and again increased by almost 75 per cent between 2007 and 2008.  Costa Ri ca's net inflow of FDI from the world has grown 
constantly, especially in 2006. 
  WT/REG218/2/Rev.1 
 Page 9 
 
 
  0102030405060708090100110120
2000
2001 2002
2003
2004
2005 2006
2007
2008Chart I.6
Costa Rica:  foreign direct investment flow (net) with Mexico and world, 2000-2008
Mexico WorldUS$ millionUS$ million
Sources:  Central Bank of Costa Rica (BCCR), Costa Rican Coalition for Development Initiatives (CINDE), Foreign Trade 
                Promotion Body (PROCOMER), Ministry of Foreign Trade (COMEX) and Costa Rican Tourism Insitute (ICT).02004006008001,0001,2001,4001,6001,8002,0002,200
2000200120022003 2004 2005 2006 2007 2008
 
 
14. Chart I.7 shows Mexico's net inflow of FDI from Costa Rica and the world in the period 
1999-2008.  The bilateral trend was erratic during this period surveyed, with a peak in 2005.  In 2002, 
Mexico's net FDI inflows from Costa Rica were ne gative (-US$1.3 million).  FDI from the world also 
fluctuated, peaking in 2001 and 2007. 
 
 WT/REG218/2/Rev.1 
Page 10  
 
  -505101520
1999
2000
20012002
2003
2004
2005
2006
2007
200805,00010,00015,00020,00025,00030,000
1999
20002001
2002
200320042005200620072008Chart I.7
Mexico:  foreign direct investment flow (n et) with Costa Rica and world, 1999-2008
Costa Rica WorldUS$ millionUS$ million
Note:     Negative flow with Costa Rica in 2003 (-US$ 1,300,000)
Source: Secretaria de Econom ía. Direcci όn General de Inversi όn Extranjera. 
 
II. CHARACTERISTIC ELEMENTS OF THE TREATY7 
A. BACKGROUND INFORMATION  
15. On 20 August 1992, Costa Rica, jointly with its  four partners in the Central American 
Common Market (CACM, also comprising El Salv ador, Guatemala, Honduras and Nicaragua), signed 
a framework agreement setting common guidelines fo r separate bilateral talks with Mexico.  The 
objective was to boost intra-regional trade and investment, as well as to attain economic 
complementarity between the six economies.  The Free Trade Treaty between Costa Rica and Mexico 
was the first Treaty to be concluded8;  it was signed on 5 April 1994 and entered into force on 
1 January 1995, following ratification by Costa Rica on 19 December 1994 and Mexico on 8 June 1994. 
16. The Treaty was notified to the WTO on 17 July 2006.  Notification of the goods aspects was 
done under Article XXIV:7(a) of the GATT 1994 and the Understanding on the Interpretation of 
Article XXIV of the GATT 1994 in document WT/R EG218/N/1/Rev.1;  the services aspects were 
notified under Article V:7 of the GATS and circulated in document S/C/N/374. 
                                                     
 
7 The information in this report generally refers to the text of the Treaty on the date of its signature in 
1992. 
8 The two other Treaties were with Nicaragua - signed in December 1997 and in force since 
1 July 1998 - and with the Northern Triangle countries (El Salvador, Guatemala and Honduras), signed in June 2000 and in force since 15 March 2001 for El Salvador, Guatemala and Mexico and 1 June 2001 for 
Honduras.  WT/REG218/2/Rev.1 
 Page 11 
 
 
  17. The Treaty comprises 19 Chapters and various a nnexes - either within the respective chapter 
or at the end of the Treaty, all of which are an integral part of the Treaty.  Box II.1 provides an outline of the Treaty, including its most relevant annexes. 
Box II.1 
Outline of the Costa Rica-Mexico Free Trade Treaty 
 
Preamble 
 
First Part: General Aspects 
Chapter I Initial Clauses 
Chapter II General Definitions  
Second Part: Trade in Goods  
Chapter III National Treatment and Market Access for Goods 
 Annex to Article 3-04:  Tariff Elimination Programme - Sections A (Costa Rica) and 
 B (Mexico) 
Chapter IV Agricultural Sector and Ph ytosanitary and Zoosanitary Measures 
Chapter V Rules of Origin 
 Annex to Article 5-03:  Specific Rules of Origin Chapter VI Customs Procedures 
Chapter VII Safeguard Measures 
Chapter VIII Clauses regarding Compensatory Quotas  
Third Part: Trade in Services  
Chapter IX  General Principl es on Trade in Services 
Chapter X  Temporary Entry for Business Persons 
 
Fourth Part: Technical Barriers to Trade 
Chapter XI  Standards, Technical Regulations and Conformity Assessment Procedures 
 
Fifth Part: Government Procurement  
Chapter XII Government Procurement 
 Annexes to Article 12-02, including lists of entities, of goods, and of services 
Sixth Part: Investment 
Chapter XIII Investment 
 
Seventh Part: Intellectual Property 
Chapter XIV Intellectual Property 
 
Eighth Part: Administrative Clauses 
Chapter XV Publication, Notification and Guaranteed Hearing and Legality 
Chapter XVI Administration of the Treaty 
 
Ninth Part: Dispute Settlement  
Chapter XVII Dispute Settlement 
 
Tenth Part: Other Clauses 
Chapter XVIII Exceptions 
Chapter XIX Final Clauses 
Annexes 
 Annex I: Reservations relating to existi ng measures and liberalization commitments - 
  Lists of Costa Rica and Mexico 
 Annex II: Economic activities reserved for each Party - Lists of Costa Rica and Mexico 
 Annex III: Exceptions to MFN treatment - Lists of Costa Rica and Mexico 
 Annex IV: Non-discriminatory quantitative restrictions - Lists of Costa Rica and Mexico  WT/REG218/2/Rev.1 
Page 12  
 
  18. While the Treaty does not prov ide a specific time-limit for implementation, the goods 
liberalization programme provides for a maximum transition period of 15 years. 
19. The Treaty is of indefinite duration.  Trade in goods is regulated by Chapters III to VIII and 
XI, trade in services by Chapter IX and X, and inv estment by Chapter XIII;  Chapters I and II and XV 
to XIX are of general application.  The regulat ory framework of the Treaty is complemented by 
country-specific Annexes providing for tariff elimin ation (Annex to Article 3-04), and reservations 
and exceptions for services (Annexes I to IV).  Gene ral definitions, included in Article 2-01, are 
complemented by country-specific definitions of  "territory" (Annex to Article 2-01) and by 
Chapter-specific definitions, included in th e first article of Chapters III to XIV. 
20. In Article 1.03, the Parties reaffirm th eir rights and obligations under the GATT.
9  In case of 
incompatibility, the provisions of the Treaty prevail. 
III. TRADE IN GOODS 
A. NATIONAL TREATMENT AND MARKET ACCESS PROVISIONS ON TRADE IN GOODS  
1. Import duties and charges, and quantitative restrictions 
(a) General provisions 
21. Article 3-03 reaffirms that national treatment, as provided for in Article III of the GATT - 
which is incorporated into the Treaty - is granted to goods of the other Party.  This does not apply to products listed in the Annex to Article 3-03 and to Article 3-09.
10 
22. Paragraph 1 of Article 3-04 includes a genera l prohibition on increasing or adopting any new 
customs duties on originating goods, unless otherwise specified elsewhere in the Treaty.  Footnotes 
clarify that this prohibition does not apply to orig inating goods for which preferential treatment was 
not being claimed, and that duties can be raised up to the level provided for in the tariff elimination 
programme (TEP) if the rate had previously been uni laterally reduced or the increase is the result of a 
dispute settlement procedure under the GATT. 
23. Article 3-04(2) and the Annex to Article 3-04 contain the TEP for originating products.  At 
the request of either of the Parties, consultations  will take place on the possible acceleration of the 
planned tariff elimination;  if an agreement is re ached, this shall replace any rate or category initially 
established (paragraphs 6 and 7).  In 1999, both Parties signed an agreement to accelerate tariff 
elimination for a list of products.11  Tariff elimination was accelerated  for products such as evaporated 
and condensed milk12;  cornflake-type cereals;  petroleum oils;  liquefied gases;  varnish for graphic 
arts;  certain vegetable oils;  steel nails;  soya sauce;  foam;  plastic hoses, inter alia .  Furthermore, 
Mexico granted quotas for packaged UHT milk, m eat of bovine animals and powder for the 
preparation of beverages, while Costa Rica granted quotas for natural honey and avocados.13 
                                                      
9 The Treaty predates the Agre ement Establishing the WTO. 
10 The lists of exceptions include, fo r Costa Rica, petroleum, petroleum oils, gas, and electrical energy;  
and for Mexico, automotive products.  A full list of these exceptions is in Annex II to this document. 
11 The outcomes of this agreement were not  included in the analysis of liberalization in this Factual 
Presentation, which was drawn up on  the basis of the original TEP. 
12 Both products were originally  excluded from the Treaty. 
13 This Agreement is available for consultation at:   
http://www.comex.go.cr/acuerdos/me xico/Desiciones%20de%20la%20comision%20administradora/decreto%2
027931.pdf  
  WT/REG218/2/Rev.1 
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  24. Paragraph 5 of Article 3-04 authorizes the a pplication of measures needed to implement 
tariff-rate quotas (TRQs) authorized elsewhere in the Treaty.14 
25. Article 3-05 specifies the restrictions that apply vis-à-vis  duty-drawback and duty-deferral 
programmes in relation to re-export, as follows: 
(a) It is authorized  to provide duty-drawback, duty deferral and duty reductions on 
imported materials used in the production of a final good that is subsequently 
exported, provided  the amount reimbursed, waived or reduced is not higher than the 
amount received (paragraph 2 of the Article); 
(b) in the case of re-export, it is prohibited  to provide duty-drawback,  duty deferral and 
duty reductions on (i) anti-dum ping or countervailing duties;  (ii) a premium collected 
on an imported good arising out of any tendering system in respect of the 
administration of quantitative import restricti ons, TRQs or tariff preference levels;  
and (iii) duties paid on a good imported and substituted by an identical or similar 
good that is subsequently exported to the other Party (paragraph 3); 
(c) at the earliest on 1 January 2002, duty-dr awback and duty-deferral programmes will 
be prohibited  for imported goods, used either as materials or replaced by similar 
materials, in the production of origina ting goods subsequently re-exported to the 
other Party, once (i) Costa Rica applies similar prohibitions vis-à-vis  a third-party;  or 
(ii) with respect to these imported goods a nd for a three-year period, if it can be 
demonstrated that these programmes cause simultaneously a significant distortion to the tariff treatment applied by the Party applying the programme and an injury to the 
other Party's production of a like product (paragraph 4)
15; 
(d) the prohibitions listed in (b) and (c) above do not apply in certain cases 
(paragraph 6)16; 
(e) the restrictions referred to above are a pplied in accordance with the procedures and 
the transparency and consultation provisi ons described in paragraphs 11 to 15 of 
Article 3-05. 
26. Article 3-08 prohibits the adoption of any measure for the waiving of customs duties 
whenever the waiver is conditioned, explicitly or  implicitly, on the fulfilment of a performance 
requirement.  Any such measure in force at the entry into force of the Treaty shall be eliminated at the 
latest by 1 January 2002.  In cases where the waiver  of customs duties has an adverse impact on the 
other Party's economy, on the commercial interests of a person of the other Party, or on the 
commercial interests of a company owned or contro lled by a person of the other Party, the Party 
granting the waiver shall either cease to grant it or make it generally available to any importer. 
27. Import restrictions or prohibitions, other than  those authorized under Article XI of the 
GATT 1994 (which is incorporated into the Treaty), are forbidden (Article 3-09);  import prices other 
                                                      
14 That is, TRQs applied by Costa Rica to natural honey and by Mexico to sugar-containing products, 
inter alia . 
15 The criteria for defining "significant distortion to the tariff treatment" and "injury" are included in 
paragraphs 9 and 10 of Article 3-05. 
16 These are:  goods in transit;  goods re-exported in the same condition as when imported;  goods 
destined for duty-free shops;  ship's stores or supplie s for ships or aircraft;  cu stoms duties refund for goods 
re-exported by reason of the failure of such good to conform to sample or specification, or by reason of the shipment of such good without the consent of the consignee;  and originating goods imported and subsequently 
re-exported to the other Party, with or without transformation or substituted by an identical or similar good. WT/REG218/2/Rev.1 
Page 14  
 
  than those applied in the context of undertaki ngs relating to the imposition of penalties or 
countervailing measures are also explicitly prohibited.   Nothing in the Treaty, however, limits the 
possibility of a Party enforcing restrictions on im ports from a third party in such a way as to avoid 
circumvention of these restrictions. 
28. Exceptions to the prohibition of quantitative rest rictions (QRs) are included in the Annex to 
Article 3-03 and to Article 3-09.
17 
(b) Liberalization of tariff lines and trade 
29. The TEP provides for a maximum transition period of  15 years, applicable both to Costa Rica 
and Mexico.  Elimination of tariffs takes place unde r 12 categories, as in Box III.1 - with category C2 
providing a different phase-out for Costa Rica and Mexico - plus another category (AE), specific to 
sugar, providing for the establishment of tariff-rate q uotas but not for the elimination of tariffs.  In 
addition, various products are excluded from the Treaty. 
Box III.1:  Categories of Tariff Elim ination in the Costa Rica-Mexico FTT  
A Elimination of tariffs as from entry into force of the Treaty. 
B Elimination of tariffs in 5 annual instalments;  duty free on 1.1.99. 
Bp No reduction until 31.12.98, duty free on 1.1.99. 
C Elimination of tariffs in 10 annual instalments;  duty free on 1.1.04. 
C1 Elimination of tariffs in 10 annual instalments;  duty free on 1.1.04.  The reduction in the 
first 5 instalments will be equivalent to 3% of the base rate, following which it will take 
place in 5 equal annual inst alments starting on 1.1.99. 
C2 (Costa Rica) Elimination of tariffs in 10 annual instalments;  duty free on 1.1.04. 
C2 (Mexico) Elimination of tariffs in 6 annual instalments starting on 1.1.97;  duty free on 1.1.02. 
C3 Elimination of tariffs in 2 annual instalments starting on 1.1.03;  duty free on 1.1.04. 
D Remain duty free. 
E Elimination of tariffs in 15 annual instalments;  duty free on 1.1.09. 
E1 Elimination of tariffs in 15 annual instalments;  duty free on 1.1.09.  The reduction in the 
first 6 instalments will be equivalent to 2.5% of the base rate, following which it will take 
place in 9 equal annual inst alments starting on 1.1.99. 
E2 Elimination of tariffs in 10 annual instalments starting on 1.1.00;  duty free on 1.1.09. 
E3 Elimination of tariffs in 4 annual instalments starting on 1.1.06;  duty free on 1.1.09. 
AE Trade in sugar conducted in a ccordance with Annex 3 to Article 4-04 (tariff-rate quota 
introduced as a result of lack of supply). 
EXCL Products excluded from the Treaty. 
Note: Unless otherwise specified, ta riff reductions start on January 1995. 
30. The base rate upon which reductions are made a nd which is specified in the Annex on the 
countries' tariff elimination is the MFN tariff for 1994, except in the case of certain agricultural goods 
for which the tariff preferences are bound under the par tial scope agreement signed by both countries.  
Liberalization takes place on 1 January of each year. 
31. Tariff elimination under the Treaty is depict ed in Tables III.1.A and III.1.B.  For both 
countries, liberalization is front-loaded, the greatest liberalization taking place at entry into force, with 
further significant liberalization in years five and te n, and coverage reaching at least 96.9 per cent in 
terms of both tariff lines and trade.  The list of excl uded products is similar for both countries, with 
                                                      
17 The lists of exceptions include, for Costa Rica, pe troleum, petroleum oils, gas, electrical energy, 
worn clothing and used or new rags, used cars and other automotive products, including tyres;  and for Mexico, used machinery, petroleum, petroleum oils, gas, worn clothing and used or new rags, new or used cars and other 
automotive products.  A full list of these exceptions is included in Annex II to this document.  WT/REG218/2/Rev.1 
 Page 15 
 
 
  the vast majority in the agricultural sect or - including poultry meat, dairy products18, potatoes, fresh 
bananas, onions, coffee, sugar, sweetened cocoa pow der, ice cream, tobacco a nd certain beverages.  
Industrial products that are excluded are certain pr oducts in Chapter 29 (Organic chemicals) and rags 
and worn clothing and articles in Chapter 63. 
32. At entry into force, Costa Rica had no tariff lin es that were duty free on an MFN basis, but as 
from that day Mexico benefited from duty-free treatm ent for around three-quarters of Costa Rica's 
tariff lines, equivalent to around one-third of its exports in 1994.  By year five, around half of the imports from Mexico in 1994 benefited from duty-fr ee treatment, with an additional 45.9 per cent 
benefiting from year ten.  Costa Rica excludes fro m the Treaty 104 tariff lines, accounting for 1.8 per 
cent of its tariff and 3.1 per cent of imports in 1994
19, and 1.1 per cent in terms of trade in 2003-2005.  
A comparison of Costa Rica's imports from Mexico in 1994 and 2003-2005 shows that trade has 
diversified;  in particular, the 740 tariff lines liber alized in 2004 represented 63.1 per cent of imports 
from Mexico in 1994, but only 22.5 per cent in 2003-2005. 
Table III.1 
Tariff elimination commitments under the Treaty 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 
Mexico 
(1994) in 
US$ million % of 
Costa Rica's 
total imports 
from Mexico 
(1994) Value of 
Costa Rica's 
imports from 
Mexico 
(2003-2005) in 
US$ million % of Costa Rica's 
total imports 
from Mexico 
(2003-2005) 
MFN duty free (1995) - - - - - - 
1995 4,191 73.3 48.4 35.2 188.7 44.5 
1999 638 11.2 19.2 14.0 115.1 27.1 
2002 6 0.1 0.8 0.6 11.1 2.6 
2004 740 12.9 63.1 45.9 95.6 22.5 
2009 36 0.6 1.8 1.3 8.9 2.1 
Remain dutiable 104 1.8 4.3 3.1 4.8 1.1 
Total 5,715 100.0 137.6 100.0 424.0 100.0 
Note: Based on the HS 1992 nomenclature. 
Figures for imports from Mexico are only presented for 1994 in stead of a 1992-1994 average, due to significant changes in 
Costa Rica's tariff nomenclature in 1994. 
Source : WTO estimates based on data provi ded by Costa Rica and WTO-IDB. 
                                                      
18 Evaporated and condensed milk (respectively 0402.91.10 for Costa Rica and 0402.91.01 for 
Mexico), originally excluded from the Treaty's coverage , became duty free for both Pa rties following the 1999 
acceleration agreement. 
19 Figures for imports from Mexico are only presented for 1994 instead of a 1992-1994 average, due to 
significant changes in Costa Ri ca's tariff nomenclature in 1994. WT/REG218/2/Rev.1 
Page 16  
 
  Table III.1 
Tariff elimination commitments under the Treaty and corresponding average trade 
B.  Mexico 
Duty phase-out period Number 
of lines % of total 
lines in 
Mexico's 
tariff 
schedule Value of Mexico's 
imports from Costa Rica 
(1992-1994) in 
US$ million % of Mexico's 
total imports 
from Costa Rica
(1992-1994) Value of 
Mexico's 
imports from 
Costa Rica 
(2003-2005) 
in US$ million % of Mexico's 
total imports 
from Costa Rica 
(2003-2005) 
MFN duty free (1995) 1,067 9.0 0.9 4.3 580.1 75.1 
1995 8,771 74.1 6.3 30.0 69.5 9.0 
1999 829 7.0 9.0 42.4 55.9 7.2 
2002 8 0.1 0.0 0.0 1.2 0.2 
2004 1,015 8.6 4.9 23.3 62.2 8.1 
2009 11 0.1 0.0 0.0 0.0 0.0 
Remain dutiable 134 1.1 0.0 0.0 3.3 0.4 
Total 11,835 100.0 21.1 100.0 772.1 100.0 
Note: Excludes data beyond HS Chapter 97.  
 Tariff lines subject to in-quota rates are excluded in the com putation;  for the calculation of averages, specific rates are e xcluded 
 and the ad valorem  part of alternate rates are included. 
 Based on the HS 1992 nomenclature. 
Source : WTO estimates based on data provided by Mexico.  The list of preferential duties applied during the transition 
period was prepared by the Secretariat and verified by the Mexican authorities. 
33. At entry into force, 9 per cent of Mexico's  tariff lines were duty free on an MFN basis, 
allowing 4.3 per cent of Costa Rica's exports in 1 992-1994 to enter duty free.  An additional 74.1 per 
cent of tariff lines became dut y free at entry into force20,21, allowing around one-third of imports from 
Costa Rica to benefit.22  By year five, more than three-quart ers of such trade was carried out on a 
duty-free basis and at year ten, virtually all liber alization was completed (only an additional 11 lines 
were liberalized in year 15).  Mexico exclud es from the Treaty liberalization of 133 tariff lines, 
accounting for 1.1 per cent of its tariff, 0.0 per cen t in terms of imports in 1992-1994 and 0.4 per cent 
in terms of imports in 2003-2005. 
34. An analysis of the tariff elimination based on trade in more recent years - i.e. 2003-2005 - 
shows, however, a different picture.  In particular , the percentage of imports that entered duty free on 
an MFN basis jumped to 75.1 per cent.  This major shift can be explained by the significant change in 
Costa Rica's export structure (see paragraph 9 above) during this period.  Table III.2 below illustrates 
in greater detail the evolution of trade patterns in  this bilateral trade.  By 2003-2005, integrated 
circuits (HS 8542.11 and 8542.19) had become Mexico's top imports from Costa Rica, accounting for 
64.1 per cent of imports in 2003-2005;  in 1995, th ree out of the four tariff lines under these headings 
were duty free on an MFN basis, and all three lines were among the top ten imports from Costa Rica. 
                                                      
20 Mexico unilaterally expanded the number of duty-free items from under 300 in 1992 to close to 
1,600 in 1996.  See document WT/TPR/S/29 of 2 September 1997, paragraph 30 of Section III(iv)(a). 
21 The list of preferential duties applied during the tr ansition period was prepared by the Secretariat and 
verified by the Mexican authorities. 
22 In this Section, computation of figures related to Me xico exclude tariff lines subject to in-quota rates;  
for the calculation of averages, sp ecific rates are excluded and the ad valorem  part of alternate rates are 
included.  WT/REG218/2/Rev.1 
 Page 17 
 
 
  Table III.2 
Mexico - Ten major products imported from Costa Rica, 1992-1994 and 2003-2005 
Total Imports 
1992-1994 
(%) MFN Rate Duty free on Total Imports 
2003-2005 
(%) 
Ten major import products 64.9%   84.4% 
Agricultural 48.2%   6.1% 
Industrial 16.7%   78.3% 
     
of which     
Palm oil 32.3% 10% 1.1.99 5.1% 
Bovine meat, fresh or ch illed 15.9% 20% 1.1.04 0.0% 
Other agricultural 0.0% 20% 1.1.95 1.0% 
     
Woven fabrics of polyester 11.3% 15% 1.1.95 0.0% 
Integrated circuits 0.0% 0 1.1.95 64.1% 
Parts and accessories of heading 8471 0.0% 0 1.1.95 8.9% 
Other industrial products 5.4% 35%-20% -15%-10% 1.1.95-1.1.99-1.1.04 5.3% 
Source : Ministry of Economy with data from Bank of Mexico. 
(c) Tariff-rate quotas 
35. Article 3-04(5) specifies that tariff-rate quotas (TRQs) are allowed, in accordance with the 
TEP and the Annex to Article 4-04 (trade in sugar,  see paragraph 78 below).  However, TRQs shall 
not have trade restrictive effects additional to tho se intrinsic to their imposition.  In addition, TRQs 
are also permitted for textiles produced in a Party th at do not comply with the rules of origin (see 
paragraph 79 below).23 
(d) Costa Rica's liberalization schedule 
36. Costa Rica's tariff in 1995 had a total of 5,715 tariff lines, reflecting, for the vast majority of 
lines, the applied CACM common tariff system (see pa ragraph 139 below).  At the Treaty's entry into 
force, there were no duty-free lines, 65.4 per cent had a rate of up to 10 per cent and 25.9 per cent of 
lines had rates of up to 20 per cent;  for 61 lines (poultry meat, dairy products, bodies for motor 
vehicles), tariffs were higher than 50 per cent.  No tariff lines had specific rates of duty.  As illustrated 
by Chart III.1, the bulk of Costa Rica's liberaliza tion was up-front.  A total of 3,126 tariff lines with 
an MFN rate of up to 10 per cent were liberalized i mmediately;  only tariffs above 40 per cent did not 
benefit from at least some tariff elimination at th e Treaty's entry into force.  At the end of the 
transition period, all tariff lines having an MFN ra te of between 30 per cent and 50 per cent would 
become duty free;  for the others, a few lines will rema in dutiable, especially those with rates of above 
50 per cent, where only 25 out of 61 lines will be fully liberalized. 
                                                      
23 Annex III gives details concerning the quota limitations. WT/REG218/2/Rev.1 
Page 18  
 
   
0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,0001995 1999 2002 2004 2009 Chart III.1  
Costa Rica's duty elimination under the Agreement  Year of duty-free treatment    
Source:  WTO Secretariat estimates, based on data provided by Costa Rica.Number of duty-free lines (cumulative)
<10%  
 <20%
 <30% MFN is:  
 <40%
 <50%
 >50%  
 
 
37. Table III.3 shows Costa Rica's trade libera lization commitments under the Treaty at the 
HS 8-digit level, organized by HS Section produc t categories.  Of the 5,715 tariff lines in its tariff 
schedule, 4,191 lines covering products in all HS sections were liberalized upon the Treaty's entry 
into force, with twice the number of industrial pr oducts being liberalized as agricultural products 
(79.1 per cent of industrial products became duty free in 1995, as against 40.8 per cent for 
agriculture).  Liberalization in years 5 and 10 also applied to almost all HS Sections, whereas in years 
8 and 15 it focused on fewer Sections.  A small numb er of lines - 104 - will remain dutiable, covering 
mainly agricultural products as well as some industria l products.  The average final applied tariff for 
these excluded products will be 50.2 per cent, ra nging from 6 per cent for chemical products in 
Section VI to 106.1 per cent for animal products in  Section I.  Figures show that, in relation to 
Mexico's main products of export interest inte nded for the Costa Rican market in the periods 
1992-1994 and 2006-2008 - namely machinery, chemi cals, base metals and minerals, as shown in 
Charts I.3.A and I.3.B - liberalization w as virtually complete and front-loaded. 
  WT/REG218/2/Rev.1 
 Page 19 
 
 
  Table III.3 
Costa Rica:  Tariff elimination under the Treaty, by HS Section 
Number of duty-free lines  
HS Section  MFN 
avg. 
(%) Total 
number 
of lines  1995 1999 2002 2004 2009 Remain 
dutiable  Avg. final 
tariff 
(dutiable)
I Live animals and animal 
products 31.0 241 93 46  42 21 39 106.1 
II Vegetable products 15.1 344 184 83  59 3 15 17.7 
III Animal or vegetable fats and 
oils 14.0 57 13 4  39 1   
IV Prepared foodstuffs, etc. 17.3 223 63 50 1 63 2 44 16.7 
V Minerals 9.4 168 137 5  23 3   
VI Chemicals and chemical 
products 7.1 837 631 138  65  3 6.0 
VII Plastics and rubber 9.5 268 146 33  89    
VIII Hides and skins 14.0 81 35 2  44    
IX Wood and articles of wood 13.8 84 11 34  39    
X Pulp, paper, etc. 9.7 191 149 27  15    
XI Textiles and textile artic les 21.9 865 826 20  10 6 3 22.7 
XII Footwear, headgear, et c. 24.6 63 25 7  31    
XIII Articles of stone 13.0 149 117 10  22    
XIV Precious stones, etc. 11.9 53 53       
XV Base metals and articles of 
base metals 8.8 662 499 47 2 114    
XVI Machinery 8.9 845 758 48 3 36    
XVII Transport equipment 15.1 175 97 74  4    
XVIII Precision equipment 11.0 236 233   3    
XIX Arms and ammunition 12.1 17 17       
XX Misc. manufactured articles 15.3 149 97 10  42    
XXI Works of art, etc. 6.0 7 7       
Total  13.3 5,715 4,191 638 6 740 36 104 50.2 
Note: Based on the HS 1992 nomenclature. 
Source : WTO estimates based on data  provided by Costa Rica. 
38. Chart III.2 shows a comparison of average du tiable rates in those HS Sections where 
preferential duties are to remain at the end of the implementation period.  The comparison is made between the average preferential and MFN rates only for lines subject to preferential duties.  As can 
be seen, tariff peaks for preferential duties in HS S ection IV (Prepared foodstu ffs;  beverages, spirits 
and vinegar;  tobacco and manufactured tobacco s ubstitutes) are lower than those applying on an 
MFN basis;  however, in the case of HS Sections I, II, VI and XI, tariff peaks remain unchanged.  In terms of average dutiable rates by HS Chapter, show n in Chart III.3, lower preferential rates apply in 
Chapters 16, 18, 21 and 22 (all in HS Section IV), and in particular in Chapter 18 (Cocoa and cocoa 
preparations) - with an average preferential rate of 6.7 per cent instead of 20 per cent - and Chapter 16 
(Preparations of meat, of fish and of crustaceans) - with an average preferential rate of 12 per cent 
instead of 20 per cent.  The highest rates apply in  HS Chapter 4 (Dairy produce), which is excluded 
from the Treaty's coverage in the original TEP. 
 WT/REG218/2/Rev.1 
Page 20  
 
  0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0XXIXXXIXXVIIIXVIIXVIXVXIVXIIIXIIXIXIXVIIIVIIVIVIVIIIIIIChart III.2
Costa Rica:  average of dutia ble rates, by HS SectionHS Section  
Source :  WTO Secretariat estimates, based on data provided by Costa Rica.Average rate of duty (%)
MFN Preferential
 
 
0 1 02 03 04 05 06 07 08 09 0 1 0 0 1 1 0 1 2 063292422212019181716090807040302Chart III.3
Costa Rica:  average of dutiable rates, by HS Chapter
HS Chapter  
Source :  WTO Secretariat estimates, based on data provided by Costa Rica.Average rate of duty (%)
MFN Preferential
  WT/REG218/2/Rev.1 
 Page 21 
 
 
  (e) Mexico's liberalization schedule 
39. Mexico's tariff in 1995 had a total of 11,835 tariff lines, of which ten lines (from Chapter 17) 
had specific duties and 36 had compound rates.  Upon the entry into force of the Treaty, the vast 
majority of tariff lines - 87.3 per cent - had a rate of up to 20 per cent, and 9 per cent of tariff lines 
were duty free.  Higher tariffs of up to 35 per cent (326 lines) or above 50 per cent applied to some 
agricultural products, including pig and poultry meat, pig fat, coffee, dairy products and tobacco.  As 
with Costa Rica, liberalization was front-loaded;  at  entry into force of the Treaty, all tariff ranges - 
with the exception of three lines at 25 per cent a nd those above 50 per cent - benefited from tariff 
elimination, and a total of 82.2 per cent of tariffs with rates of up to 20 per cent became duty free.  A 
similar percentage (83.7 per cent) of lines with a rate  of 35 per cent were also liberalized at entry into 
force of the Treaty.  For lines with tariffs above  40 per cent or with specific rates, the major 
elimination of tariffs took place in 2004 (jointly with  1999 for the latter category).  At the end of the 
transition period, all three lines at 25 per cent, virtually all other lines up to 40 per cent, and about one-third of lines above 40 per cent will become duty free. 
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,00019951999200220042009Chart III.4
Mexico's duty elimination under the Treaty
Year of duty-free treatment   
Source: WTO Secretariat estimates, based on data provided by Mexico.  The list of preferential duties applied during the   
transition period has been prepared by the Secretariat and verified by Mexican authorities.Number of duty-free lines (cumulative)
<10% <20% <30% MFN is: <40% <50% >50% non ad valorem duty-free
 
 
40. Table III.4 shows Mexico's trade liberali zation commitments under the Treaty at the 
HS 8-digit level, organized by HS Section prod uct categories.  Around three-quarters of Mexico's 
tariff lines were liberalized at entry into force, w ith a significantly higher percentage of industrial 
rather than agricultural products - respectively 78 per cent and 33.5 per cent - becoming duty free.  
More than 90 per cent of lines in three HS Sections  - covering textiles, precision equipment and arms 
and ammunition - became duty free at that time.   The second major liberalization took place in 
year 10, when tariffs under 15 HS Sections beca me zero.  Following that, a few additional lines - 
covering vegetables, fats and oils, prepared foods, minerals and tex tiles - were liberalized in 2009.  
Duties remain in place with respect to 134 lines - 120 on agricultural products and 14 on industrial products.  The average final applied tariff for tho se excluded products will be  58.6 per cent, ranging WT/REG218/2/Rev.1 
Page 22  
 
  from 5.9 per cent for chemical products in Section VI to 83 per cent for animal products in 
Section I. With regard to the main products of e xport interest to Costa Rica and intended for Mexico 
in 1992-1994 and 2006- 2008 - namely machinery, textiles, and fa ts and oils, as shown in Charts I.3.A 
and I.3.B - liberalization was virt ually complete and front-loaded vis-à-vis  the first two product 
categories. 
Table III.4 
Mexico:  Tariff elimination unde r the Treaty, by HS Section a 
Number of duty-free lines  
HS section  MFN 
avg. 
(%) Total 
number 
of lines  MFN 
1995  1995 1999 2002 2004 2009 Remain 
dutiable  Avg. final 
tariff 
(dutiable)  
I Live animals and animal 
products 31.8 259 11 84 52  58  54 83.0 b 
II Vegetable products 15.3 405 73 163 74  82 2 11 60.3 c 
III Animal or vegetable fats 
and oils 20.0 75 1 17 11  45 1   
IV Prepared foodstuffs, etc. 19.2 295 4 82 75 1 76 2 55 42.6 b 
V Minerals 8.8 220 30 156 5  27 2   
VI Chemicals and chemical 
products 10.3 2,761 288 2,140 255  69  9 5.9 b 
VII Plastics and rubber 13.1 527 26 355 36  110    
VIII Hides and skins 15.2 98 8 34 3  53    
IX Wood and articles of 
wood 15.9 124  17 43  64    
X Pulp, paper, etc. 9.6 335 38 239 37  21    
XI Textiles and textile 
articles 19.8 1,076 5 1,010 31  21 4 5 30.0 
XII Footwear, headgear, et c. 24.9 71  34 4  33    
XIII Articles of stone 15.3 350 3 312 13  22    
XIV Precious stones, etc. 9.4 81 23 58       
XV Base metals and articles 
of base metals 12.9 1,325 37 1,039 68 2 179    
XVI Machinery 11.5 2,583 448 1,988 54 5 88    
XVII Transport equipment 13.5 360 13 286 56  5    
XVIII Precision equipment 12.2 545 45 496   4    
XIX Arms and ammunition 17.2 27  27       
XX Misc. manufactured 
articles 17.7 304  234 12  58    
XXI Works of art, etc. 0.0 14 14        
 Total 13.4 11,835 1,067 8,771 829 8 1,015 11 134 58.6 
a Calculations relating to the MFN average only include ad valorem  duties, while those for the average final tariff (dutiable) also 
include lines with specific or compound duties.  Thus, compar ison between the MFN and preferential averages is biased. 
b Combination of ad valorem  and specific or compound duties. 
c Average rate is based on ad valorem  duty (excludes prohibited tariff line). 
Note: Excludes data beyond HS Chapter 97.  
 Tariff lines subject to in-quota rates are excluded in the com putation;  for the calculation of  averages, specific rates are 
excluded and the ad valorem  part of alternate rates are included. 
Based on the HS 1992 nomenclature. 
Source : WTO estimates based on data provided by Mexico. 
41. Chart III.5 shows a comparison of average du tiable rates in those HS Sections where 
preferential duties are to remain at the end of the implementation period.  The comparison is made 
between the average preferential and MFN rates only for lines subject to preferential duties.  As can 
be seen, tariff peaks for preferential duties in HS Secti ons I, II, VI and XI are slightly lower than those 
applying on an MFN basis.  Agricultural sections ha ve high MFN rates, and the relative margin of 
preference is 4.4 per cent in Section I and 2.6 per cent in Section II.  Section IV presents an unusual 
situation where preferential rates are higher than MFN rates;  this is due to the fact that the 
corresponding MFN rates for the products concerned are either of a specific or a compound nature 
(and only the ad valorem  component is taken into account in the Chart), whereas for preferential rates, 
one product is only subject to an ad valorem  rate (of 156 per cent).  Table III.5 presents, for the lines  WT/REG218/2/Rev.1 
 Page 23 
 
 
  remaining dutiable, a comparison between the MFN a nd the preferential rates for products subject to 
specific and/or compound rates. 
0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0XXIXXXIXXVIIIXVIIXVIXVXIVXIIIXIIXIXIXVIIIVIIVIVIVIIIIIIChart III.5
Mexico:  average of dutiable rates, by HS Section
HS Section  
Note:      Consists of tariff lines containing remain dutiable rates that are only ad valorem .
Source :  WTO Secretariat estimates, based on data provided by Mexico.Average rate of duty (%)
MFN Preferential
 
 
Table III.5 
Mexico:  Average of remaining dutiable rates of a specific and/or compound nature, by HS Section 
MFN Preferential rate in 2009 HS 
Section HS 
Chapter Numb
er of 
lines Description 
Ad valorem  
component Specific duty Ad valorem  
component Specific duty 
I 4 4 Live animals and 
animal products 16.25% US$0.39586/kg. 16.25% 0.36 Dl per kg. of sugar 
II 12 1 Vegetable products  Prohibited  Prohibited 
IV 17 1 Prepared foodstuffs, 
etc.  15% US$0.39586/kg. 156%  
 17 8   US$0.39586/kg.  US$0.3589825/kg. of sugar 
 17 3   10% US$0.39586/kg. 10% US$0.36/kg. of sugar 
 18 1   US$0.39586/kg.  US$0.36/kg. of sugar 
 19 1    10% US$0.39586/kg. 10% US$0.36/kg. of sugar 
 20 2  20% US$0.39586/kg. 20% US$0.36/kg. of sugar 
 21 1   US$0.39586/kg.  US$0.36/kg. of sugar 
 21 2  17.5% US$0.39586/kg. 8.75% US$0.36/kg. of sugar 
 22 4   15% US$0.39586/kg. 15% US$0.36/kg. of sugar 
VI 29 1 Products of the 
chemical or allied 
industries 10%  7% US$0.36/kg. of sugar 
  2  10% US$0.39586/kg. 7% US$0.36/kg. of sugar 
Note: Consists of tariff lines with a combination of ad valorem /specific duties either at the MFN or preferential level. 
Source : WTO Secretariat estimates based on data provided by Mexico. WT/REG218/2/Rev.1 
Page 24  
 
  2. Rules of origin 
42. Rules of origin are set out in Chapter V. Th e basic requirements for a good to be considered 
originating, as in Article 5-03, are the following: 
(a) The good is wholly obtained or pro duced entirely in the Parties;  or 
(b) the good is produced entirely in the Parties from originating materials only;  or 
(c) the good is produced entirely in the Parties and all of the non-originating materials 
meet the specific criteria contained in the Annex to Article 5-03;  or 
(d) unassembled goods and goods classified with their parts which, though not meeting 
specific origin rules, contain not less than  50 per cent of regional value content 
(RVC) using the transaction method (or 41.66 per cent using the net cost method).  
This does not apply to goods under HS Chapters 61 to 63. 
43. The main criterion for a good produced from non-or iginating materials to acquire originating 
status is a change in tariff classification (CTC), us ed either alone or jointly with a RVC requirement 
for the good.  In certain cases, only a RVC requireme nt applies.  The CTC applies generally at the 
HS heading level, but requirements at the subheadi ng and chapter levels are also frequent.  Finally, in 
a small number of cases, specific product or process requirements apply, alwa ys in conjunction with 
another method.
24 
44. In the case of sets or assortments (Article 5-10), each part of the set has to fulfil the origin 
requirements.  Notwithstanding this, a set or asso rtment will be originating if the value of all 
non-originating elements does not exceed 7 per cent of  its transaction value or, for those goods valued 
under the net-cost method, 7 per cent of its total cost. 
45. Once originating status has been granted to a product, any processing outside the territory of 
the Parties, "other than unloading, reloading or any other operation necessary to preserve it in good 
condition or to transport it...", will result in a loss of  such status (Article 5-17).  Transit - with or 
without transhipment and storage - is authorized, provided the good remains under the surveillance of 
the customs authorities.25 
46. Article 5-04 provides that the RVC, which is th e difference between the value of the good and 
that of the non-originating materials, can be cal culated on the basis of the transaction value method - 
where non-originating materials are valued as a pe rcentage of the total price paid for the good 
adjusted to a f.o.b. basis - or the net cost met hod - where these are valued  as a percentage of net 
producer costs.26  While the exporter/producer can generally choose to calculate the RVC under either 
method, paragraph 5 specifies the cases where only the net-cost method can be used.27 
                                                      
24 In the "Explanatory Document to the Treaty" of the Ministry of Foreign Trade of Costa Rica, it is 
specified that the CTC method applies, in a decreasing order, at the HS heading, subheading, chapter and finally tariff item levels in respectively 500, 141, 139 and 42 ru les, that CTC and RVC are jo intly used in 300 rules, 
that RVC is used alone in 60 rules, and that product or processing requirements are used in 23 rules.  See 
http://www.comex.go.cr/acuerdos/mexi co/Paginas/docexplicativo.aspx. 
25 See the provisions of the Uniform Re gulation of the Treaty (http://srv-share-
02:8400/acuerdos/mexico/Desiciones%20de%20la%20comision%20administradora/Anexo%20Decisión%20N
%2021%20RU.pdf). 
26 In the net-cost method, calculations are more complex where the value is composed of the total net 
cost minus costs relating to marketing, sales, after-sales services, etc.  The product's total cost results from the  WT/REG218/2/Rev.1 
 Page 25 
 
 
  47. Article 5-05 stipulates that the value of a materi al is its transaction value;  in cases where this 
does not exist or cannot be determined, the value is calculated in accordance with the 
WTO Agreement on Implementation of Article VII of  the GATT 1994.  Article 5-05 clarifies that, in 
any case, the value of materials shall include the price of freight, insurance, packaging and other 
transport costs.  In accordance with Article 5-27, during a six-year transition period, the 
RVC thresholds applicable to certain products28 using the net-cost method 33.33 per cent would be 
40 per cent using the transaction-value method a nd from 1 January 1995 until 31 December 1997 and 
45 per cent and 37.50 per cent, respectively, from 1 January 1998 until 31 December 2000. 
48. Bilateral cumulation applies betw een the two countries.  The absorption principle - i.e. when 
incorporated into a final good, the value of non-originating materials incorporated in another good 
that has acquired originating status is not added into the RVC calculation - also applies, except for 
certain automotive products.  This is also the case fo r those materials which have been designated as 
"intermediate material" by the producer (Article 5-05(4 )).  When an intermediate material is subject to 
a RVC requirement, only the net-cost method can be used;  further, only a material locally produced 
in either Party and subject to a RVC requirement may be designated as intermediate material 
(Article 5-07). 
49. A de minimis  rule (Article 5-06) applies as follows: 
(a) The CTC requirement is waived and the good considered originating if the value of 
all non-originating materials that do not co mply with the required CTC is less than 
7 per cent of the transaction value, adjust ed as appropriate, or, when relevant, the 
total cost of the good.  Any additional  RVC requirement will apply without any 
change; 
(b) the RVC requirement is waived if the valu e of all non-originating materials is less 
than 7 per cent of the transaction value or, when relevant, the total cost of the good. 
50. This rule does not apply to the following: 
(i) Textiles goods in HS Chapters 50 to 63;  however, if the good is 
non-originating because the fibres and ya rns used do not comply with the 
CTC requirements, it will nonetheless be c onsidered originating if their total 
weight does not represent more than 7 pe r cent of the material's total weight; 
(ii) a non-originating material in HS Chapter 4 (dairy produce, eggs, honey, and 
edible products of animal origin) or Ch apter 15 (animal or vegetable fats and 
oils and animal or vegetable waxes) or falling under headings 0901 (coffee), 
1701 (sugar), 1901 (malt extract, food preparations of flour, meal, starch or 
malt extract), 2105 (ice cream) or 2202 (waters containing added sugar or flavoured and other non-alcoholic bevera ges, not including fruit juices) used 
in the production of goods of Chapters 1 to 24;  and 
                                                                                                                                                                    
 
sum of the costs of direct materials used in production, labour, and other direct and indirect production costs.  
The Annex to Article 5-01 contains detailed rules relating to net-cost calculations. 
27 Including if there is no trans action value for the good or it ca nnot be determined because of 
restrictions on the use of the good;  the sale or its pr ice are dependent on a counterpart;  the buyer and seller are 
related and this relationship has influenced the price;  the exporter or producer are accumulating the RVC;  the 
good is a motor vehicle or a part th ereof;  or the good has been design ated as an intermediate material. 
28 These products are listed in the Annex to Article 5-27.  It includes 38 tariff sub-headings of 
HS Chapters 34 (soaps and shoe polishes and creams), 35 (glues and adhesives), 38 (insecticides, herbicides, 
fungicides) and 39 (plas tics and articles thereof). WT/REG218/2/Rev.1 
Page 26  
 
  (iii) a non-originating material used in the production of goods of Chapters 1 to 
27, unless the material is of a sub-heading different from the one for which origin is being determined. 
51. In addition to the different rules applied to automotive products mentioned above (obligatory 
use of the net-cost method, differentiated treatment vis-à-vis  the absorption principle), Article 5-15 
contains other clauses relating to rules of origin specific to these products.  These rules detail how to 
calculate the RVC of different categories of automotive products. 
52. Article 5-16 provides an exhaustive list of mini mal, non-qualifying operations and clarifies 
that its provisions prevail upon any of the specific rules of origin in Annex 5-03. 
53. The Chapter on rules of origin provides for th e creation of two bodies, namely the Committee 
on Rules of Origin (Article 5-18) - meeting at least twice a year or at the request of a Party - and the 
Committee on Regional Integration of Inputs (CIRI, Artic le 5-20).  The aim of the CIRI is to evaluate 
the difficulties faced by producers in accessing certain ma terials needed (as specified in the rules of 
origin) for the production of final goods, for export to  the other Party, under appropriate conditions (in 
terms of opportunity, vol ume, quality and price).
29  The CIRI is established for a period of ten years, 
subject to extension upon agreement by the Parties.   Articles 5-22 to 5-25 state how the investigating 
role of the CIRI is to be implemented following a Party's request, and the required follow-up with the 
Treaty's Commission.  Rules relating to the operation of the Committee, due to be agreed by 1 January 1995, were finally agreed on 15 January 1999, pursuant to Decision No. 9 of the Treaty's 
Administrative Commission, and entered into force on 1 March 1999. 
Box III.1:  Rules of Origin at a Glance 
Basic Characteristics 
• Product-specific criteria: 
o Wholly obtained goods. 
o CTC, generally a change of heading. 
o RVC:  50% at transaction value method and 41.66% at net-cost method, generally applied in 
conjunction with the CTC but in certain cases used alone. 
o Specific requirements applied in a few cases. 
• Bilateral cumulation. 
• Absorption principle applies with exceptions. 
• Tolerance rule. 
• Duty-drawback. 
• No outward-processing authorized. 
 
3. Export duties and charges, and quantitative restrictions 
54. Export restrictions or prohibitions, other than  those authorized under Article XI of the 
GATT 1994, are forbidden (Article 3-09);  export pri ces are also forbidden.  Nothing in the Treaty, 
however, limits the possibility of a Party enforcing r estrictions applied on exports from a third party in 
such a way as to avoid circumvention of these restric tions.  Article 3-10 prohibi ts the levying of taxes 
on goods being exported to the other Party, unless these are also applied on the domestic market. 
                                                      
29 Products of the chemical and allied industries;  plastics and articles thereof;  textiles;  iron and steel 
and articles thereof;  copper an d articles thereof;  aluminium a nd articles thereof;  respectively 
HS Chapters 28-38, 39, 50-63, 72-73, 74 and 76.  These products are listed in the Annex to Article 5-21, which 
may be modified at any time u pon agreement by the Parties.  WT/REG218/2/Rev.1 
 Page 27 
 
 
  B. REGULATORY PROVISIONS ON TRADE IN GOODS  
1. Standards 
(a) Technical barriers to trade 
55. Chapter XI applies to any technical regulations th at may affect, directly or indirectly, trade in 
goods and services between the Parties.  It does no t apply to sanitary and phytosanitary measures 
under Section B of Chapter IV of the Treaty (Article 11-02).  Each Part y must ensure that its technical 
regulations, standards and conformity assessment procedures do not restrict trade more than is necessary to fulfil a Party's legitimate objective, taking into account the risks that non-fulfilment 
would create (Article 11-05).  The Parties reaffirm their rights and obligations under the GATT and all international treaties related to security, pr otection of human, animal and plant life, and 
environmental protection to which they are a party (Article 11-04). 
56. Measures necessary to comply with  the Chapter's provisions are to be adopted by the Parties' 
central or federal governments or by authorized  non-governmental bodies (Article 11-03).  The 
Parties have undertaken a best endeavours commitment  to ensure the compatibility, on the basis of 
existing international standards, of their respec tive technical regulations and conformity assessment 
procedures (Article 11-07) and, when they act as or create unnecessary barriers to trade, their 
metrological standards
30 (Article 11-12).  A best endeavours co mmitment has also been undertaken to 
work to ensure the consistency of conformity asse ssment systems and procedures with a view to their 
mutual recognition (Article 11-08).  Transparen cy provisions are contained in Article 11-09 
("Notification, publication and deliver y of information");  each Party is to be informed of the other 
Party's technical regulations before their entry into force and not later than the other Party's nationals.  
Each Party is also required to establish at least one enquiry point in its territory to provide information 
to the other Party's interested persons.  Article  11-11 specifies that no provisions under Chapter XI 
require a Party to provide information contrary to its essential security interests or to the legitimate 
commercial interests of certain companies. 
57. Under Article 11-13, each Party may, on the groun ds of protection of public health, subject 
the following to national registration procedures:  medicines;  medical equipment and instruments;  
pharma-chemical products and other products intended for human, animal or plant health use;  toxic 
goods and substances;  radioac tive products, sources or equipment;  and sources and equipment 
emitting ionic radiation.  When such registration is required in a Party's territory, the product shall be 
registered, recognized and evaluated by the competent authority of that Party in conformity with its 
compulsory national system, either at the central or federal level, in order to obtain a certificate of 
compatibility.  As provided for in the Treaty, the Par ties have established a system of mutual technical 
cooperation and created an ad hoc Sub-Committee.  Under Article 11-15 on th e management of toxic 
and hazardous substances, the Parties shall apply th e international conventions to which they are 
Party;  when a toxic or hazardous product or substa nce requires a permit or is subject to a registration 
procedure for its management or transport, such a pe rmit shall be issued or registration carried out by 
the Party's competent authority, at the central or federal level. 
58. Article 11-17 establishes a "Committee on Standa rdization Measures", which consists of 
representatives from each Party's competent authorities.  It is required to convene at least once a year, 
but also at the request of a Party or in the event of an emergency.  Where a Party needs clarification 
on the interpretation or application of the Chapter's provisions, it shall request consultations within the 
Committee or the dispute settlement body estab lished under the Treaty (Article 11-20). 
                                                      
30 The Annex to Article 11-12 specifies that Costa Rica is exempted from obligations relating to 
metrological standards for three years as  from the Treaty's entry in to force.  Metrological standards are currently 
already consistent with existing international standards. WT/REG218/2/Rev.1 
Page 28  
 
  (b) Sanitary and phytosanitary measures 
59. Section B of Chapter IV deals with sanitary  and phytosanitary measures.  The Parties may 
adopt or maintain any measure that is more restri ctive than international regulations, principles or 
recommendations where this is necessary to protect human, animal or plant life and health (Article 4-13(1)).  Such a measure includes the pr ohibition to import a specific product when it does 
not comply with the applicable requirements or  does not satisfy the importing Party's approval 
procedures.  Sanitary and phytosanitary measures must:  (a) be based on scientific principles and 
appropriate risk assessment;  (b) be applied in a non-discriminatory manner;  and (c) not constitute 
unnecessary barriers to trade between the Parties.  Ac cording to Article 4-13(8), each Party retains the 
right to establish its own level of protection of hum an, animal and plant life and health, in accordance 
with the conditions in Article 4-16 ("Risk asses sment and adequate leve l of protection") are 
respected.
31  Article 4-15 promotes the equivalence of sanitary standards and, where possible, the 
establishment of identical rules. 
60. Transparency provisions are contained in Article 4-19.  Each Party is required to inform the 
other about the adoption or modification of a phytosan itary or zoosanitary measure at least 60 days in 
advance of its adoption or modification.  The establishment of an enquiry point in each Party's 
territory is required under Article 4-20.  The Parties are not required to provide each other with information that may (a) prevent the investigati on, surveillance or control of activities aimed at 
fulfilling a Party's legislation;  or (b) be contrary to public interests;  or (c) affect commercial interests 
protected under national legislation.  The "Comm ittee on Phytosanitary and Zoosanitary Measures" is 
created under Article 4-22 with the aim of, inter alia :  providing recommendations (Article 4-22(1)), 
facilitating technical cooperation, and improving food safety conditions (Article 4-22(3)).  Section B 
of Chapter IV is subject to the Treaty's dispute settlement provisions. 
2. Safeguard mechanisms 
(a) Global safeguards 
61. Article 7-04 reaffirms the rights and obligations of the Parties in accordance with Article XIX 
of the GATT.
32  Paragraphs 2 to 5 of this Article indicate the circumstances for applying global 
safeguards on imports from the other Party;  these are described in the paragraph below.  The 
procedural aspects of safeguard measures are dealt with in paragraph 65 below. 
62. The application of a global safeguard to the ot her Party is circumscribed in the Treaty to cases 
where imports from the other Party, considered i ndividually, represent a "subs tantial part" of total 
imports and contribute "significantly" to "serious in jury" in the importing Party (Article 7-04(2)), in 
particular: 
                                                      
31 Article 4-16 requires that each Party take the following into account when carrying out risk 
assessment procedures:  available scientific and technical  information;  appropriate risk assessment methods and 
technologies;  critical control points in production processes or operating methods, management, packing, inspection, demonstration or proof;  existence of pests or diseases, including the existence of pest- or 
disease-free areas or areas of low pest or disease pr evalence;  ecological or ot her relevant environmental 
conditions;  and applicable quarantine measures a nd treatments that satisfy the other Party's import 
requirements.  Each Party shall also take into account production or sales lo sses due to pests or disease;  the 
costs of pest or disease control and eradication in the Party's territory;  and the cost-efficiency ratio of other 
possible options to limit risks. 
32 The Treaty was concluded prior to the establishm ent of the WTO and the en try into force of the 
Agreement on Safeguards.  WT/REG218/2/Rev.1 
 Page 29 
 
 
  (i) Imports originating in the other Party are "substantial" if they are among 
imports from the main suppliers, which collectively amount to at least 80 per cent of the imports of the product concerned; 
(ii) normally, imports originating in the other Party will not be considered as 
contributing significantly to serious injury if their growth rate during the 
period in which the serious injury occu rred is substantially lower than the 
growth rate of imports from all other countries during the same period;  and 
(iii) changes affecting the other Party's import share, both in terms of value and 
volume, will be taken into account. 
63. In cases where a global safeguard measure is also  applied to the other Party, these may only 
be imposed following notification a nd consultations.  The affected Party may obtain mutually agreed 
compensation in the form of a concession with commercial effect equiva lent to the safeguard 
measure. 
(b) Bilateral safeguards 
64. A bilateral safeguard measure (Article 7-03) ma y be applied up to two years following the 
completion of the TEP, if the import volume incr eases at a pace and under conditions that cause or 
threaten to cause serious injury to the domestic i ndustry.  Bilateral measures must (i) be necessary to 
prevent serious injury;  (ii) be of limited durati on (one year, renewable only once for another year);  
and (iii) consist of a rise in customs duties to the MFN rate prevailing at the time of the adoption of the safeguard measure or the applied customs duty the day before the entry into force of the TEP, 
whichever is the lower.  Where a Party decides to apply a bilateral safeguard measure, it must inform 
the other Party in writing and enter into consultati ons.  Mutually agreed compensation will be offered 
to the affected Party in the form of additional tari ffs concessions with equivalent commercial effect to 
the safeguard measure. 
65. The procedure for the adoption of safeguard meas ures, both global and bilateral, is described 
in Article 7-05.  It is necessary to demonstrate a direct "causality link" between the rise in imports and 
the serious injury to a Party's domestic production.  The investigation is to be carried out by the 
Party's competent authorities.
33  Consultations between the Parties will last 45 days from the 
submission of the request, unless otherwise agreed.  If the importing Party maintains that the conditions for application of a safeguard measure pers ist, it must notify the other Party of its intention 
to extend the measure at least 60 days before it expires. 
3. Anti-dumping and countervailing measures 
66. The Parties shall apply their national legisla tion on anti-dumping in a manner consistent with 
the GATT principles, the Agreement on Implemen tation of Article VI of the GATT, and the 
Agreement on Subsidies and Countervailing Measures (Article 8-04). 
67. The investigation procedure for the determina tion of dumping is to be carried out by the 
Parties' competent authorities;  the preliminary ruling must be issued within 130 days from the 
beginning of the procedure, but in no case before 45 days (Article 8-13).  The importing Party must 
                                                     
 
33 According to the Annex to Article 7-01, the competent authority for Costa Rica is currently the 
Ministry of the Economy, Industry and Trade ( Ministerio de Economía, Industria y Comercio );  and for Mexico, 
the Ministry of Commerce and Industrial Development ( Secretaría de Comercio y Fomento Industrial ), or its 
successor. WT/REG218/2/Rev.1 
Page 30  
 
  terminate the investigation when:  (i) the margin of dumping or subsidy is de minimis
34;  (ii) no proof 
of dumping, subsidy or injury exis ts;  or (iii) the volume of impor ts subject to dumping, subsidy or 
injury is negligible (Article 8-05).  Any decision by a Party's competent authorities must be published 
(Article 8-09) and notified, in writing, to the inter ested persons (Article 8-10).  While the threshold for 
the de minimis  margin of dumping is the same as in  the WTO Agreement on Implementation of 
Article VI of the GATT 1994 (i.e. less than 2 per cent of the export price), for subsidies, it is higher in 
the Treaty (less than 1.5 per cent, compared to l ess than 1 per cent in th e WTO Agreement).  The 
Treaty defines negligible injury as when the impor t volume is less than 1 per cent of the internal 
demand or less than 3 per cent of total imports of id entical or similar products by the importing Party;  
in the WTO Agreements, no reference is made to "n egligible" in terms of internal demand, the same 
percentage applies in terms of imports in the Anti-Dumping Agreement, but no precise definition is 
given in the Agreement on Subsidies and Countervailing Measures. 
68. According to Article 8-17, a countervailing duty will be reviewed annually by the competent 
authorities upon request by the interested Party, or ex officio  whenever a change in the circumstances 
that justified the adoption of the measure occurs .  The review may result in the confirmation, 
modification or elimination of the countervailing du ty;  in any case the countervailing duty will be 
automatically revoked after five years from its imposition or last review, the same duration as 
provided for in the WTO Agreement on Subsidies and Countervailing Measures. 
69. Chapter VIII on anti-dumping is subject to the Treaty's dispute settlement provisions 
(Article 8-25). 
4. Subsidies and State aid 
70. Article 8-03 prohibits the Parties from adop ting any new direct export subsidies on goods 
destined for the other Party's territory as from the Treat y's entry into force.  It also requires the Parties 
to eliminate any existing export subsidies on goods subj ect to tariff elimination in accordance with the 
TEP.  All subsidies are to be eliminated on 1 January 1999. 
71. However, during the period in which subsid ies remain applicable, a Party may impose 
countervailing duties on subsidized exports when im ports of such goods create adverse effects on its 
trade (Article 8-03(4)).35  Each Party must submit a written request for consultations, which must be 
concluded within 30 days of receipt of the request .  In cases where the Parties cannot find a mutually 
agreed solution and the exporting Party does not susp end the application of subsidies within 30 days 
from the end of the consultations, the importing Party may adopt the countervailing duties necessary 
to eliminate the adverse effects of  the subsidy on its trade.  The exporting Party has 60 days from the 
beginning of consultations to provi de the other Party with evidence of  the absence of negative effects 
of the export subsidies. 
5. Customs-related procedures 
72. Chapter VI deals with customs procedur es (Section A) and cooperation in customs 
administration (Section B).  According to Article 6-02, the importing Party may require exporters of 
the other Party to provide a certificate of origin in order for their exports to obtain preferential tariff 
treatment.  The certificate of origin, on which agre ement had been reached upon the entry into force 
                                                      
34 The margin is defined as de minimis  when:  (a) for dumping, it is less than 2 per cent of the export 
price;  (b) for a subsidy, it is less than 1.5 per cent of the ad valorem  component;  and (c) for injury, the import 
volume is less than 1 per cent of the internal demand or less than 3 per cent of the total imports of identical or 
similar products by the importing Party. 
35 Paragraph 5 defines "adverse effects" on trade as:  an adverse change in the market share of an 
identical or similar product in the importing Party;  a major price reduction or constraint of the identical or 
similar product in the importing Party;  or a major and su stained increase in the subsidized imports' growth rate.  WT/REG218/2/Rev.1 
 Page 31 
 
 
  of the Treaty, was adopted by the Parties.36  The certificate of origin is not required when:  (i) the 
value of imports (for commercial and non-comme rcial purposes) does not exceed US$1,000 (or its 
equivalent in national currency)37;  and (ii) when the importing Party exempts a good from the 
requirement of a certificate of origin (Article 6-05). 
73. The procedure for verifying the origin of a good is described in Article 6-07.38  T h e  
competent authorities of the importing Party may subm it a written questionnaire to, or visit, exporters 
or producers in the territory of the exporting Party.  With regard to the questionnaire, the exporter or 
producer has 30 days from the date of receipt to respond;  in case of delay, the importing Party may deny preferential tariff treatment further to a decisi on to that effect.  The importing Party must notify 
its intention to visit in writing 30 days in advance.   The notification will be sent to the exporter or 
producer to be visited, to the Party's competent authorities and, upon request, to the Embassy of the 
importing Party.  If the exporter or producer does not  confirm the visit within 30 days from receipt of 
the notification, the importing Party may deny pref erential tariff treatment on the good subject to 
verification.  Within 120 days from verification, the competent authorities of the importing Party must 
issue a written decision on the origin of the good and notify it to the exporter or producer.  If the 
importing Party considers that the exporter or produ cer has provided false or incorrect information on 
the good's origin, it may suspend preferential tariff tr eatment until the good is in conformity with the 
rules of origin established under the Treaty.  Article 6-10 sets out the conditions for the establishment, in advance, of written criteria for the import of g oods into each Party's territory.  Pursuant to 
Article 6-08, each Party must grant to exporters or  producers of the other Party the same right to 
review and challenge any decision on the determinati on of origin as that granted to importers in its 
territory. 
74. Under Article 6-11, the Parties establishe d a "Committee on Customs Procedures", which 
consists of representatives from both Parties a nd is to convene at least twice a year. 
75. Section B of Chapter VI deals with customs administration.  The Parties have undertaken to 
cooperate and assist each other in customs matters (A rticle 6-13);  to expedi te the transit of goods 
within their territories (Article 6-14);  to ensure th e immediate shipping of goods (Article 6-15);  to 
create a registry of temporary transport units aut horizing them to circulate within the Parties' 
territories for a duration of 30 days (Article 6-16);  and to provide facilities for fairs, exhibitions or 
other similar events (Article 6-17) and for promoti onal activities (Article 6-18).  The Parties have also 
undertaken to exchange information on customs matters (Article 6-21). 
76. A "Committee on Customs Coordination" has been established under Article 6-22.  The 
Committee's functions are described in Article 6-23.  It is to convene at least once a year and, upon 
request by any Party, within 30 days from such a request. 
77. In addition to these provisions, in 2008 the Par ties approved the Uniform Regulations of the 
Free Trade Treaty.
39 
                                                      
36 The format of this certificate is  available on the website of Cost a Rica's Ministry of Foreign Trade 
(http://www.comex.go.cr/acuerdos/ mexico/Paginas/certificado.aspx ) and on the website of Mexico's Ministry of 
the Economy http://www.economia.gob.mx/swb/work/models/economia/Resource/411/1/images/CER--
COST.doc . 
37 In this case, it may be requested that the invoice contain a declaration of or igin of the good by the 
importer or the exporter. 
38 Provisions in this regard are also contained in the Uniform Regulations. 
39 Available on the website of Costa Rica's Ministry of Foreign Trade at:  
http://www.comex.go.cr/acuerdos/me xico/Desiciones%20de%20la%20comision%20administradora/Anexo%20
Decisi per centC3 per centB3n%20N%2021%20RU.pdf. WT/REG218/2/Rev.1 
Page 32  
 
  6. Sector-specific provisions on trade in goods 
(a) Agricultural products 
78. A special category of the TEP (AE), and Annex 3 to Article 4-04, deal with trade in sugar.  
The "AE" category - which provides that preferentia l treatment for trade in sugar is regulated by 
Annex 3 - applies to four tariff lines in the case of  Costa Rica, and seven in the case of Mexico.  
Given that the Annex only deals with imports by Me xico from Costa Rica, no preferential treatment is 
provided by the latter vis-à-vis  imports from the former;  thus, for Costa Rica, sugar is de facto 
excluded from the Treaty and trade is carried out under MFN rates.  As regards Mexico, the Annex 
provides for a flexible TRQ system for imports from Costa Rica, based on the following principles: 
(a) If Mexico opens up a global sugar quota, 19 pe r cent of the quota must be allocated to 
Costa Rica
40; 
(b) if, in the context of another trade agreemen t, Mexico also grants a preferential quota 
to another country, then the 19 per cent quot a allocation will be modified - unless the 
countries benefiting from the preferential quota are either Colombia or Venezuela - in accordance with a formula provided for in the Annex; 
(c) in no case shall the preferential quota allocation be below 8 per cent of the total 
quota; 
(d) the in-quota rate is duty free;  the out-of-quota rate is the MFN rate; 
(e) sales are subject to a reference price (Contract 14, New York Coffee, Sugar and 
Cocoa Exchange, CSCE);  and 
(f) in accordance with paragraph 10, the pr ovisions of the Annex were valid until 
31 December 2007.  Once the deadline established in the Annex expired, sugar was 
excluded from the preferences under the Treat y and its entry into Mexico became 
subject to the payment of import duties. 
(b) Textiles products 
79. Article 3-14 provides for "levels of temporary fl exibility" for certain textile products.  This 
provision allows preferential treatment to be grante d to certain textiles products that do not meet the 
Treaty's origin criteria;  preferential treatment remain s, however, subject to certain less strict rules of 
origin
41 and is granted on the basis of pre-defined quotas.  More specifically, for certain textile 
products, the use of non-originating threads, yarns or  fibres is authorized, subject to value limitations.  
These quotas increased progressively from 1 January  1995 until 31 December 1999, when this 
temporary arrangement lapsed and only the TEP applie d.  Exports of products classified under the 
same tariff heading cannot be higher than a 30-per-cent share of the yearly quota (in value terms);  if 
that is the case, then the normal, more stringent, ru les of origin would apply.  Annex III gives details 
concerning the quota limitations. 
                                                      
40 If no imports are needed, the quota will be zero. 
41 That is, the rules of origin are not th ose listed in the Annex to Article 5-02.  WT/REG218/2/Rev.1 
 Page 33 
 
 
  IV. TRADE IN SERVICES AND INVESTMENT 
A. SCOPE AND DEFINITIONS  
80. Trade in services provisions are contained in Chapter IX, "General Principles on Trade in 
Services" and Chapter X, "Temporary Entry of Business Persons";  investment provisions are contained in Chapter XIII, "Investment". 
81. Chapter IX covers all four modes of supply:   cross-border (mode 1), consumption abroad 
(mode 2), commercial presence (mode 3) and temporar y movement of natural persons (mode 4, also 
covered in Chapter X) for all services sectors (Art icle 9-02(2)), excluding those listed in paragraph 3 
of Article 9-02 (see below).  An Annex on prof essional services limits the applicability of the 
Chapter's provisions to what is stipulated therei n.  Chapter IX applies to measures adopted or 
maintained by the Parties at federal, central or state levels and by non-governmental authorities in the 
exercise of powers delegated to them by government  authorities (Article 9-02(5)).  The Chapter does 
not, however, create any obligation regarding the righ t of nationals from the other Party to access a 
Party's employment market or those already employed on a permanent basis in its territory, nor impose any obligation or grant any right regardin g government procurement by a Party or a State 
enterprise. 
82. Chapter IX does not apply to (Art. 9-02(3)): 
(a) Air transport services, including domestic and international, scheduled and 
non-scheduled air transport services, as well as related services in support of air 
services.  Aircraft repair and maintenance services during the period in which an aircraft is withdrawn from service, specialty air services and computerized 
reservation systems are, however, included in the Treaty's scope; 
(b) financial services; 
(c) subsidies and donations by a Party or a State enterprise, including governmental 
loans, guarantees and insurance;  and 
(d) services provided by a Party in the exercise of governmental authority, such as 
services related to retirement, social security and public education. 
83. Chapter XIII on investment applies to measur es adopted or maintained by each Party with 
respect to: 
(a) Investors of the other Party and their investments; 
(b) investments in the Party's territory by inv estors of the other Party as from the Treaty's 
entry into force;  and investments made pr ior to the Treaty's entry into force where 
such investments qualify as foreign invest ments.  However, Chapter XIII does not 
apply to disputes or claims that arose, or were settled, prior to the Treaty's entry into force or related to events preceding the Tr eaty' enactment which continue to produce 
their effects after its entry into force;  and 
(c) all investments of investors from a Party in the territory of the other Party with 
respect to Article 13-06 (performance requirements). WT/REG218/2/Rev.1 
Page 34  
 
  84. Chapter XIII does not apply to economic activities reserved for a Party, as listed in Annex II, 
any measure taken or maintained in relation to financial services, or measures taken to restrict 
activities of the other Party's investors for reasons of public order or national security. 
B. D
ENIAL OF BENEFITS  
85. Subject to previous notification and consulta tion, each Party may deny the benefits of 
Chapter IX to a services supplier of the other Part y when it determines that the service is being 
provided by an enterprise that has no important busin ess operations in its territory and, in accordance 
with the legislation of that Party, the enterpri se is owned or controlled by persons of a non-party 
(Article 9-15). 
86. Article 13-13 allows a Party to deny the benefits of the investment Chapter, subject to prior 
notification and consultations, to an investor of the ot her Party that is an enterprise of the Party and its 
investments, when such an enterprise is owned by  investors of a non-party (in accordance with the 
definition in Article 13-01), and the enterprise do es not have business activities in the other Party's 
territory. 
C. GENERAL PROVISIONS ON TRADE IN SERVICES  
87. The Treaty adopts a "negative-list" approach, whereby the key provisions of the services 
Chapter apply to all covered sectors and modes of supply, unless otherwise provided.  Article 9-06 provides a time-frame
42 for the Parties to specify, in annexes, their reservations - i.e. non-conforming 
measures - to the principles of national treatment, MFN treatment and local presence applied at the federal, central and Stat e levels of government.  On 27 July 2000, pursuant to Decision No. 12 of the 
Treaty's Administrative Commission, the commitme nts referred to in Article 9-06 (Binding of 
measures) were considered to be finalised.  As at June 2010, Mexico's services and investment 
schedules have not been published in the Official Jo urnal since the relevant internal legal procedures 
have not been completed;  they are not ther efore considered to be in force in Mexico. 
88. The Treaty provides for future liberalization th rough negotiations to be convened by the 
Administrative Commission, as well as for commitmen ts to liberalize non-discriminatory quantitative 
restrictions (Articles 9-08 and 9-09, respectively).  With regard to the commitments established in 
these Articles, the Parties have not further liberalized  services sectors to eliminate the restrictions, in 
accordance with paragraphs 2 and 3 of Article  9-06, nor have they drawn up a schedule of 
commitments to liberalize quantitative restrictions, requirements concerning authorizations, permits or 
licences, or other non-discriminatory measures. 
1. Market access 
89. No provision of the type under GATS Article XVI exists in the Treaty.  In accordance with 
Article 9-07, Parties are to list their non-discrimin atory quantitative restrictions on the provision of a 
service.  This list was also established through the above-mentioned Decision, and is included in 
Annex IV to the Treaty.
43 
                                                      
42 The original time-frame provided that this should be done within one year from the entry into force 
of the Treaty;  this deadline was not met. 
43 The one-year deadline was also not met in this case.  WT/REG218/2/Rev.1 
 Page 35 
 
 
  2. National and MFN treatment 
90. National treatment is granted under Article 9-04.   Each Party undertakes to accord to the 
services and service providers of the other Party treatment no less favourable than that it accords, in similar circumstances, to its own like services and like service providers. 
91. Under Article 9-03, a Party agrees to immedi ately and unconditionally accord to cross-border 
services and service providers of the other Party treatment no less favourable than it accords to like 
services and like service providers of any other c ountry.  Nothing in Chapter IX shall prevent the 
Parties from according commercial preferences to nei ghbouring countries in order to facilitate trade in 
services that are produced or consumed locally. 
92. National treatment is granted to the other Pa rty's investors and investments under Article 
13-03.  Each Party undertakes to accord these inv estors and investments treatment no less favourable 
than that it accords, in lik e circumstances, to its own investors and investments.  
Most-favoured-nation (MFN) treatment is granted to the other Party's investors and investments under 
Article 13-04.  Each Party undertakes to accord th ese investors and investments treatment no less 
favourable than that it accords, in like circumstances, to the investors and investments of non-Parties.  
The provisions of Chapters 9 and 13 are applicable to persons acting as service providers or investors, 
respectively. 
93. National and MFN treatment provisions do not apply: 
(a) To the reservations included in Annex I (existing measures).  The level of 
non-conformity of such measures cannot be increased (Articles 9-06 and 13-08); 
(b) to any measure in relation to economic activ ities reserved for the Parties, as included 
in Annex II (Articles 9-06 and 13-02); 
(c) to the agreements or sectors listed in Anne x III (MFN):  aviation, fisheries, maritime 
affairs, including rescue, and tax issues (Article 13-08); 
(d) to acquisitions made by a Party or by a State enterprise or subsidies granted by a 
Party or a State enterprise (Article 13-08(3)). 
3. Local presence 
94. Under Article 9-05, neither Party may require a service provider of the other Party to establish 
or maintain a representative office or other form of  enterprise or be resident in its territory as a 
condition for the supply of a service, without prejudice  to the existing measures set forth in Annex I. 
4. Movement of natural persons 
95. Chapter X deals with the temporary entry of certain categories of business persons.
44  I t  
reflects the preferential trading relationship betw een the Parties, the desirability of facilitating 
temporary entry on a reciprocal basis and the need to establish transparent criteria and procedures for 
temporary entry, while at the same time ensuring border security, the protection of the domestic labour force, and permanent employment in their respective territories (Article 10-02). 
                                                     
 
44 Pursuant to Article 10-01, "business person" means a citizen of a Party who is engaged in trade in 
goods, the provision of services or the conduct of investment activities. WT/REG218/2/Rev.1 
Page 36  
 
  96. Each Party is committed to granting temporar y entry to business persons in the following 
categories, as established in the Annex to Article 10-04
45: 
• Business visitors must present proof of citi zenship of a Party;  accredit a prior request 
by an enterprise established in the territory of  a Party;  declare that they are engaged 
in a business activity and describe the pur pose of entry;  demonstrate that the 
proposed business activity is international in  scope and that the business person is not 
seeking entry to the local labour market;  a nd comply with the applicable immigration 
measures. 
• Investors must prove that they are seeking to  establish, develop, administer or provide 
advice or key technical services, in a capacity that is supervisory, executive or 
involves essential skills, to the operation of  an investment to which the business 
person or the business person's enterprise h as committed, or is in the process of 
committing, a substantial amount of capital, and must also comply with the applicable 
immigration measures. 
• Intra-company transferees who seek to render services in a capacity that is 
managerial, executive or involves speciali zed knowledge may be required to have 
been employed continuously by the enterp rise for one year within the three-year 
period immediately preceding the date of the application for admission, and also to comply with the applicable immigration measures. 
97. A Party may refuse to issue an immigration doc ument authorizing employment to a business 
person where the temporary entry of that person mi ght 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 the di spute.  In this case, the Party refusing to issue an 
immigration document must notify the business pers on in writing of the reasons for the refusal 
(Article 10-04). 
98. A Committee for the Temporary Entry of Business  Persons is establishe d under Article 10-06.  
Article 10-07 limits the Party's rights to recourse to dispute settlement to situations where the refusal 
to grant authorization for temporary entry is a recurrent practice and the business person concerned 
has exhausted all possible administrativ e recourse for the issue concerned. 
5. Performance requirements 
99. Article 13 06 prohibits the Parties from imposing requirements or commitments in respect of 
an investment of an investor of another Party, as well as the receipt of an incentive for such an 
investment.  The following requirements are prohibited: 
(a) Export requirements relating to a give n level or percentage of goods; 
(b) local content requirements; 
(c) the granting of preferences to domestically  produced goods, or acquisition of goods 
from domestic producers;  and 
                                                     
 
45 Annex A.3 to Article 10-04 indicates the national legislation relevant to this Chapter, namely the 
General Immigration Law ( Ley General de Migración y Extranjería ) of 1986 for Costa Rica, and the General 
Population Act ( Ley General de  Población ) of 1974 for Mexico, in both cases with their amendments and 
regulations).  WT/REG218/2/Rev.1 
 Page 37 
 
 
  (d) requirements relating the volume or value of imports to the volume or value of 
exports or to capital inflows resulting from the investment. 
100. The requirements described above do not apply to  any measure contained in Annex I.  These 
measures may be modified, provided that the level of non-conformity does not increase 
(Article 13-08(1)). 
6. Requirements for senior management and board of directors 
101. Article 13-07 prohibits restrictions on the na tionality of senior management, but permits 
nationality requirements in respect of the majority of the members of the governing bodies of an enterprise.  Notwithstanding the above, the nationa lity requirements set forth in Annex I may be 
applied (Article 13-08). 
7. Other investment provisions 
102. Other disciplines of Chapter XIII include, inter alia , transfers, expropriation and 
indemnification, extraterritorial application of a Part y's legislation, and promotion of investments.  In 
cases of inconsistency between a provision of this Ch apter and any other Chapter, the provision of the 
latter shall prevail.  The Chapter also includes a mechanism to settle disputes between a Party and 
investors from another Party. 
D. L
IBERALIZATION COMMITMENTS  
1. Costa Rica46 
103. In its Annex I, Costa Rica has listed reserva tions for existing non-conforming measures in a 
number of sectors (Table IV.1) including restrictions  on the national treatment obligation, generally in 
the form of nationality or establishment requirements.   Ten MFN reservations have also been listed, 
the majority reflecting reciprocity arrangement s in place among Central American countries in 
activities such as professional services, transportation and telecommunications services.  All limitations listed operate at the national level. 
104. The two horizontal limitations under the GATS are maintained under the Treaty in 
reservations I-CR-1, I-CR-10 and I-CR-68. 
Table IV.1 
Non-conforming measures listed by Costa Rica in Annex I 
Sector/Subsector Obligations Mode De scription/Reduction of Restriction 
All NT/MFN/SM CBTS/I Nationality requirements.   Exceptions established, including for 
nationals of Central American count ries.  Restrictions do not apply 
to SMBD provided no more than 2 foreigners at each higher 
position. 
All NT/LP CBTS Establishment of an agent with general powers required. 
Construction services NT/LP CBTS Preferences fo r domestic companies in the execution of public 
work. 
Professional services NT/MFN/LP CBTS/I Reciprocity and/or  residency requirements.  In some cases, a certain 
number of years of practice is required;  the residency requirement 
is waived for architects and engineers from Central America. 
Construction services NT CBTS Higher registration fees for foreign companies. 
                                                      
46 Costa Rica has only once modified its Schedule of Specific Commitments (SSC) under the GATS, 
with the integration of commitments in the financial sector in February 1998. WT/REG218/2/Rev.1 
Page 38  
 
  Sector/Subsector Obligations Mode De scription/Reduction of Restriction 
Commercial and distribution 
services NT/LP CBTS Residency requirements.  Exceptions provided for in respect of 
international treaties or conventions. 
Hotels and restaurants NT/LP CBTS/ I Nationality requirements for tourist activities in the maritime land 
zone.  Concessions in this area are based on nationality, residency, 
domicile, incorporation and equity requirements. 
Rail transport services LP CBTS C onstruction, modification, transport and other railway services are 
reserved for the State, which can grant concessions.  Establishment 
requirements for the granting of a concession. 
Land transportation services - 
transportation of passengers NT/MFN CBTS/I Preferences for domestic companies.  Reciprocity requirement.  
Equity requirements for internati onal transportation;  preferential 
treatment for Central American nationals. 
Land transportation services - 
freight transportation NT/MFN/SM CBTS/I Nationality requirements.  Registration requirements, with certain 
exceptions for Central American vehicles.  Equity and nationality 
requirements relating to the eff ective control of the company. 
Water transport services NT/LP CBTS/I Nationality a nd equity requirements.  Registration required. 
Water transport services and 
auxiliary water transport services NT/LP CBTS/I Construction and exploitation of ports are reserved for the State, 
which can grant concessions. 
Air transport services - specialty services and airport services NT/MFN/LP/ 
SM CBTS/I Construction and exploitation of airports are reserved for the State, 
which can grant concessions.  Na tionality, equity, residency and 
reciprocity requirements.  These requirements focus in particular on investments.  
Tourist guides and travel 
agencies NT CBTS/I Nationality and equity requirements. 
Telecommunications - wireless 
international services NT CBTS/I Concessions granted by the State, with nationality requirements. 
Telecommunications - radio and 
television NT/MFN/SM CBTS/I Concessions for wireless se rvices granted by the State.  Radio 
services for military and official use reserved for the State.  All 
other services granted through concessions, with nationality, equity 
and reciprocity requirements. 
Research and development 
services NT CBTS Nationality requirements.  Preferential treatment granted to 
nationals. 
Advertising services NT/MFN CBTS/I Domestic cont ent requirements regarding advertisement in favour 
of companies benefiting from government subsidies.  Nationality 
requirements for speakers;  preferential treatment given to Central American nationals of countries  providing for reciprocity. 
Audiovisuals - advertising, 
services of cinema, radio, 
television and other shows NT/MFN CBTS Nationality and domestic content requirements.  Preferences given 
regarding rules of origin for adve rtisements from Central American 
countries. 
Services incidental  to agriculture, 
hunting and forestry NT CBTS Licensing requirement, with treatment differentiated for 
non-resident foreigners. 
Fisheries and services incidental to fishing NT CBTS/I Exclusive sovereignty and nationality requirements.  Preferential 
treatment for nationals. 
Services incidental to mining - 
hydrocarbon exploration and 
radioactive minerals NT/MFN/LP CBTS/I State monopoly, or conce ssion required;  may involve partnership 
with a foreign State.  Establishment and nationality requirements. 
Electric energy NT I State monopoly, or concession required.  Equity requirements. 
Higher education services NT CBTS Nationality requirements. 
Health services NT CBTS Nationality re quirement for senior nursing positions. 
Sporting and other recreational 
services - services of cinema, 
radio, television and other shows NT/MFN CBTS Nationality and local-content requirements.  Preferential treatment 
for productions from a Centra l American country providing 
reciprocity. 
News agency services NT CBTS Residency requirement s;  exceptions allowed for restricted time and 
subject to previous authorization. 
Sporting and other recreational services NT/LP CBTS/I Nationality requirements for tourist activities in the maritime land 
zone.  Concessions in this area are based on nationality, residency, 
domicile, incorporation and equity requirements. 
Sporting and other recreational 
services - shows and other 
entertainment services NT CBTS Foreign shows require a national promoter. 
Note: CBTS:  Cross-border trade in services;  I:  Investment;  LP:  Local presence re quirements;  MFN:  Restriction to MFN trea tment;  
 NT: National treatment restriction;  SM:  Senior mana gement restriction;  PR:  performance requirements. 
Source : Annex I to the Costa Rica-Mexico FTT.  WT/REG218/2/Rev.1 
 Page 39 
 
 
  105. Economic activities reserved for th e Parties are listed in Annex II;   Costa Rica has specified 
the following: 
• Crude oil and its derivatives:  import, refining, distribution and wholesale trade; 
• alcohol production; 
• postal services; 
• wire and wireless services; 
• energy exploitation; 
• water supply services;  sewage and industr ial liquid waste collection and disposal 
services;  water supply and sewerage services; 
• social services. 
106. The quantitative restrictions listed in Annex IV by Costa Rica apply to the following 
subsectors: 
• Crude petroleum and derivatives, asphalt a nd naphtha:  sale, maintenance and repair 
services of motor vehicles and motorcycles;  commission agents' and wholesale trade services, except of motor vehicles and motorcycles;  land transport services; 
• liquor production:  commission agents' and wholesale trade services, except of motor 
vehicles and motorcycles; 
• supply of liquor for consumption:  hotel and restaurant services 
• national railways, docks and airports:  land transport services and supporting and 
auxiliary transport services; 
• land transport services, water transport services and air transport services; 
• cargo handling services:  supporting and auxiliary transport services; 
• travel agency, tour operator and touris t guide services:  supporting and auxiliary 
transport services; 
• post and telecommunication services; 
• rental/leasing services without operators; 
• placement and supply services of personnel, other business services, n.e.c.; 
• services incidental to agriculture, mining, and manufacturing; 
• education services (higher education); 
• sewage and refuse disposal services, sa nitation and similar services;  and WT/REG218/2/Rev.1 
Page 40  
 
  • recreational, cultural and sporting services. 
107. The above demonstrates that Costa Rica's commitments under the Treaty go significantly 
beyond its commitments under the GATS, which are lim ited to 5 of the 11 sector groups in the W/120 
classification.  However, the Treaty does not cover fi nancial services, nor does it contain an obligation 
like Article XVI of the GATS.
47 
108. Costa Rica's commitments under the GATS for bu siness services are limited to a partial 
coverage of computer and related services;  these are fully liberalized under the Treaty.  All other 
sub-sectors are opened up;  some reservations appl y to professional, research and development and 
some other business services, generally nationality, reciprocity and/or residency requirements.  Real 
estate and rental/leasing services without operators are fully liberalized under the Treaty.48 
109. Costa Rica has no GATS commitments on communication services.  The Treaty reserves 
postal activities for the State;  fully liberalizes courier services;  requires a concession and imposes 
nationality requirements for the provision of telecommunication wireless services as well as radio and TV services;  and imposes nationality and domestic  content requirements on certain audiovisual 
services.  Concessions for radio and TV are granted on the basis of various requirements. 
110. Construction and related engineering services;  distribution services;  environmental services;  
recreational, cultural and sporting services;  and transport services are also not subject to 
commitments under the GATS.  Construction services are not subject to any specific reservation for Mexican companies under the Treaty, with the exception of the preference given to national 
companies for public works, and any State-reserve d activity (specified in Annex II).  As for 
distribution services, wholesale and franchising are fully opened to Mexicans, while retailing and 
Commission agents' services are opened to Mexican s established in the country for more than 
ten years unless otherwise specified in any internati onal agreement.  Distribution services for crude oil 
and derivatives as well as energy are, however, reserved for the State, and the number of fuel concessions can be limited.  Few environmental se rvices are actually liberalized, given that sewage, 
water supply and refuse disposal services are reserved  for the State or subject to QRs.  Certain 
recreational, cultural and sporting services are s ubject to reservations under Annexes I and IV. 
111. All transport services other than air transport have  been incorporated in the Treaty.  However, 
both land and water transport services are subject to  various reservations under Annexes I and IV.  
Only a few air transport services sub-sectors are covered by the Treaty;  these are subject to Annex I reservations.  Construction and e xploitation of railroads  and ports are reserved for the State and 
national treatment reservations are established in the freight and passenger sectors. 
112. With respect to education - in which Costa Rica has partial commitments under the GATS 
-the Treaty reserves public education and training to the State.  Higher education is opened up, subject 
to a requirement (Annex I) that at least 85 per cent  of certain levels of staff of private higher 
educational institutions must be Costa Rican nationals, and a series of other requirements vis-à-vis  the 
qualifications of professors of private universities (Annex IV). 
113. Costa Rica has liberalized tourism and trav el-related services under the Treaty;  however, 
tourism activities in coastal land zones supplied by Me xicans remain subject to various requirements.  
Further, a nationality requirement applies for touris t guides;  travel agencies are subject to equity 
(Annex I) and numerical limitations (Annex IV);  the latter also applies to establishments selling 
                                                     
 
47 At the time of the Treaty's entry in to force, financial services were not yet part of Costa Rica's GATS 
commitments.  These were integrated into the GATS in 1998 and cover banking and other financial services. 
48 Annex IV however requires a minimum number of vehicles and a minimum investment for being 
able to benefit from incentives.  WT/REG218/2/Rev.1 
 Page 41 
 
 
  liquor for consumption on the premises.  This improves upon GATS commitments, which are often 
unbound, for example as regards hotel services under m ode 3 or travel agency services under mode 1. 
2. Mexico49,50 
114. Mexico has listed existing reservations at the le vel of both federal and state governments;  the 
former (totalling 69) are summarized in Table IV.2.51  These represent limitations on MFN and 
national treatment and local presence in Annex I, generally in the form of  nationality requirements 
and/or ownership interests.  Mexico has adopted  seven MFN reservations in respect of fishing, 
professional, and transportation services. 
115. As regards GATS horizontal commitments, commercial presence limitations - providing 
conditions for foreign participation in activities re served for Mexican nationa ls - and land ownership 
on the coastline and along frontiers, are maintained.  In relation to the presence of natural persons, the 
commitments under the Treaty are more liberal than under the GATS.  The GATS limitation on 
maximum foreign ownership, normally up to 49 per cent of the registered capital of enterprises, may be waived, subject to prior authorization, for investments from Costa Rica above a given threshold 
(US$150 million in 2003, increasing annually). 
Table IV.2 
Existing non-conforming measures  (at the Federal level of governme nt) listed by Mexico in Annex I 
Sector Obligations Mode Description/Reduction of Restriction 
All NT I Limitation on property right s over land and water for foreign 
nationals or enterprises. 
All NT I Criteria for permitting invest ment:  (a) effects on employment and 
training of workers;  (b) technologi cal contribution;  (c) compliance 
with environmental provisions;  and (d) contribution to the 
competitiveness of Mexican production. 
All NT I Permission required for investme nt above 49% by foreign investors.  
From 1999, the threshold for investors from Costa Rica increases 
annually. 
All NT/SMBD I Maximum limit of 10% for foreigners and for foreign ownership in a 
Mexican production cooperative.  No  foreign nationals in general 
administrative functions or managerial activities. 
All NT I Nationality requirement for mi cro-industry enterprises;  no foreign 
partners. 
Agriculture, livestock, forestry, and 
lumber activities NT I Nationality requirement to own land for these activities.  Maximum of 
49% participation by foreign investors through shares. 
Communication (leisure services, radio and TV) NT/PR CBTS/I Imports of radio and TV programmes subject to previous 
authorization. 
Communication (leisure services, 
radio and TV) NT/LP CBTS/I Concessionª required.  Only Mexican nationals and Mexican 
companies with foreign exclusion cl auses can provide such services.  
Reservation does not apply to producti on, sale or authorization rights 
for radio and TV programmes. 
Communication (leisure services, radio and TV) NT/PR CBTS/I Requirements for the use of Sp anish;  majority of programming based 
on nationality requirements.  Prev ious authorization required for 
non-Mexican nationals. 
Communication (leisure services 
radio and TV) NT/PR CBTS/I Requirements for the use of Spanish or Spanish subtitles in 
advertisements, except when pr ogrammes are retransmitted from 
abroad. 
                                                      
49 Mexico modified its Schedule of Specific Co mmitments (SSC) under the GATS in July and 
October 1995 (changes to financial services), April 1997 (changes to telecom services) and finally in 
February 1998 (further changes to financial services). 
50 See paragraph 87 above. 
51 A total of 111 reservations have been adopted at the level of the State government;  they are also 
listed in Annex I to the Treaty. WT/REG218/2/Rev.1 
Page 42  
 
  Sector Obligations Mode Description/Reduction of Restriction 
Communication (leisure services) - 
cable TV NT I Equity requirements. 
Communication (leisure services) - 
cable TV NT/LP CBTS Concession by the SCT required for constructing and/or operating 
cable TV, given only to Mexican nationals and Mexican companies. 
Communication - cinemas NT/PR CBTS/I Domestic content requirements. 
Communications, 
telecommunications and transport NT I Restrictions on foreign investme nt in communications, transportation 
and other general means of communication. 
Energy, including basic petrochemical goods NT CBTS Services reserved for Mexican s and Mexican companies with foreign 
exclusion clauses. 
Communications - telecommunications for 
aeronautical services NT/LP CBTS/I Services reserved for Mexi cans and Mexican companies with foreign 
exclusion clauses. 
Communications - first class postal services, telegraphy and 
radiotelegraphy services, maritime telecommunications NT/LP CBTS Reserved for the Mexican State. 
Telecommunications services and 
public networks (commercial 
agencies) NT/LP CBTS/I Permit required from the SCT;  only granted to companies established 
under Mexican law. 
Telecommunication services and 
public networks NT/LP CBTS/I Concession required;  reserved  for Mexicans and Mexican companies.  
Exclusive rights granted to " Telecomunicaciones de Mexico " for links 
with Intelsat and Inmarsat.  Equity  requirements.  Registration needed 
for facsimile services. 
Telephone services, i.e. mobile and public telephone services, and 
telecommunication installation NT/LP CBTS/I Concession or permit require d and granted only to Mexican nationals 
and Mexican companies.  Exclusive rights granted to 
"Telecomunicaciones de Mexico" for li nks with Intelsat and Inmarsat.  
Equity requirements;  permission required for foreign investments 
above the threshold in mobile phone services. 
Construction services NT I Permit required for fo reign investments above the equity threshold.  
This restriction is lifted as of 1 January 1999.  
Construction - petroleum and 
petroleum-derivative pipelines;  
drilling of oil and gas wells NT I Prohibition on risk-sharing contract s.  Otherwise, permit required for 
foreign investments above the equity threshold. 
Education services - private schools NT CBTS/I Permit required for foreign inve stments above the equity threshold. 
Energy - retail trade in 
liquefied-gas fuels NT CBTS/I Services reserved for Mexican  nationals and Mexican companies with 
foreign exclusion clauses. 
Fishing - in ocean;  coastal waters;  
and inland waters NT/MFN CBTS/I Permit required for foreign investments above the equity threshold. 
Manufacture of goods - automotive 
products NT I Equity requirements.  These do not  apply if investors/investments are 
considered "national" or if they do not apply for government benefits. 
Manufacture of goods - automotive 
products PR I Requirements that are incompatible with Article 13-06 on PR.  
Reduction of restriction in accordan ce with deadlines under domestic 
law. 
Manufacture of goods - "maquilladoras " PR I Limitation on sales in the domes tic market in terms of value of 
exports.  Reductions of restricti on as of 1.1.1997, restriction 
eliminated on 1.1.2001. 
Manufacture of goods PR I Export requirements for "direct" and "indirect" exporters;  
discontinued on 1.1.2001. 
Manufacture of goods PR I Export requirements for authorized exporters eliminated on 1.1.2001. 
Manufacture of goods - explosives 
and fireworks;  firearms and 
cartridges NT I Equity requirements. 
Printing, editing and associated 
industries - periodicals NT I Equity requirements for periodi cals printed and/or published only in 
Mexico;  these do not apply for printing and/or distribution of 
periodicals published simultaneously outside the Mexican territory. 
Professional, technical and 
specialized services:  medical 
doctors - medical and dental services 
provided by the private sector NT CBTS Nationality/licence requirements for in-house medical services in 
Mexican enterprises.  WT/REG218/2/Rev.1 
 Page 43 
 
 
  Sector Obligations Mode Description/Reduction of Restriction 
Professional, technical and 
specialized services - customs 
services and representative 
agencies NT CBTS Nationality and au thorization requirements for a customs broker. 
Professional services NT/MFN/LP CBTS The provision of pr ofessional services by foreigners in the Federal 
District is subject to the provisions of international treaties subscribed 
to by Mexico.  In the absence of these, reciprocity is required.  Foreigners are to have an address in Mexico. 
Professional services - accounting 
services NT/LP CBTS Nationality and licence require ments for the accounting of certain 
companies.  As of 1.1.1996, certain foreigners are also allowed in 
accordance with treaties in force. 
Professional, technical and specialized services - public 
brokers NT CBTS/I Association with  non-public brokers is not allowed;  nationality (by 
birth) and permanent residency requi rements.  Latter restrictions 
eliminated as of 1.1.1997, but foreigners are to be domiciled in 
Mexico. 
Professional, technical and specialized services - public notary NT/LP CBTS/I Association is not allowed;  nationality (by birth) and establishment 
requirements 
Professional, technical and 
specialized services - private 
veterinary services NT/LP CBTS Nationality requirements.  Requi rement eliminated two years after the 
entry into force of the Treaty, but a requirement remains for a 
domicile in Mexico. 
Trade of arms and ammunition NT I Equity requirements. 
Religious services - services of religious organizations LP/SMBD CBTS/I Nationality requirement for repr esentatives of religious associations.  
Registration of religious organizations is subject to establishment 
requirements. 
Services to agriculture NT/LP CBT S Concession by authorities required for spraying pesticides based on 
nationality requirement. 
Air transport - scheduled air 
transport services on domestically 
registered aircraft, non-scheduled 
air transport (air taxis) NT/SMBD I Equity requirements.  Nationality requirement for the chairman, the 
board of directors and managing officers.  Only companies complying 
with these restrictions may register an aircraft in Mexico.  
Specialty air services NT/LP/ 
SMBD CBTS/I Equity requirements.  Nationality requirement for the chairman, the 
board of directors and managing officers.  Permit required, and 
granted for foreigners for certain listed services only;  certain other 
services liberalized on 1.1.97 and 1.1.2000. 
Air transport - aeronautical navigation services, airport and 
heliport management services NT/LP CBTS/I Concession, granted only to  nationals and Mexican commercial 
companies.  Equity requirements;   permission required for foreign 
investments above the threshold. 
Land transport - establishment or 
operation of bus or truck stations or 
terminals NT/LP CBTS/I Permit reserved for Mexica n nationals and Mexican companies with 
foreign exclusion clauses;  all foreign investment forbidden.  
Progressive liberalization planned;  as of 18.12.95 thresholds for 
equity requirements established a nd progressively liberalized, with 
equity restrictions eliminated on 1.1.04. 
Land transport - railway crew NT CBTS Nationality requirement. 
Land transport - road and bridge management services and auxiliary 
services NT/LP CBTS Concession required and gran ted only to Mexican nationals and 
Mexican companies. 
Land transportation:  local bus;  school bus;  and taxi and other 
collective transportation NT CBTS/I Reserved for Mexican nationals  and Mexican companies with foreign 
exclusion clauses. 
Land transportation:  construction 
materials transport, moving, other 
specialized freight transport, 
general freight transport, long-distance passenger bus and 
coach transport, tourist transport 
services NT/MFN/LP CBTS/I Reserved for Mexican nati onals and Mexican companies with foreign 
exclusion clauses;  foreign investme nt forbidden.  Permit needed for 
certain services.  Progressive libera lization planned;  as of 18.12.95 
thresholds for equity established and progressively liberalized, with 
equity restrictions eliminated on 1.1.04. 
Transportation - road and water transports NT/LP CBTS Concession required for constructing and/or operating works in 
relation to road and water transpor t, given only to Mexican nationals 
and Mexican companies. WT/REG218/2/Rev.1 
Page 44  
 
  Sector Obligations Mode Description/Reduction of Restriction 
Transportation - construction and 
operation of pipelines carrying 
goods other than energy or basic 
petrochemicals NT/LP CBTS Concession required, given onl y to Mexican nationals and Mexican 
companies. 
Professional, technical and 
specialized services - customs 
agents NT I Reserved for Mexican investors and investment. 
Fishing NT/MFN/LP CBTS Concession/permit requi red, given only to Mexican nationals and 
Mexican companies using boats flying Mexican flag. 
Water transport - construction and 
repair of ships NT/LP CBTS Concession required, granted only to Mexican nationals and Mexican 
companies. 
Water transport - services of international maritime 
transportation, cabotage maritime, 
international and cabotage towing, 
internal port water transportation, river and lake transportation NT/MFN CBTS/I Restrictions regarding the nationality of the shipping company apply 
for various services, including th e possibility of reserving them 
exclusively for Mexican companie s.  Equity requirements;  
permission required for forei gn investments above 49% for 
exploitation of ships for interna tional maritime transportation. 
Water transport - port management NT/LP CBTS Nationality requirements for all port workers. 
Water transport - loading and 
unloading services NT I Permission required for fo reign investments above 49%. 
Water transport - loading and 
unloading services NT/LP CBTS Concession required, granted only to Mexican nationals and Mexican 
companies.  Permit required for st orage and stowing services, granted 
only to Mexican nationals and Mexican companies. 
Water transport - integral port 
management NT I Equity requirements. 
Water transport - piloting port 
services NT I Equity requirements. 
Rail transport NT I Equity requirements;  permission required for foreign investment 
above the threshold. 
Energy - supply of fuel and 
lubricants for aircraft and railway 
equipment NT I Equity requirements. 
Water transport - ocean navigation NT/MFN/PR CBTS/I For automo tive products, if freight and in surance are contracted with 
Mexican companies, their value will be accounted within the value of 
exports and subtracted from the value of imports. 
Professional, technical and 
specialized services - legal services NT/MFN/LP CBTS/I Only lawyers authorized to  practice in Mexico can participate in a 
settlement;  lawyers authorized to ex ercise in Costa Rica can associate 
themselves with those exercising in Mexico, subject to numeric 
limitations and to reciproc ity.  Equity requirements. 
Transport - specialized personnel, 
i.e. captains, pilots, owners, 
machinists, mechanics and crew of ships and planes of Mexican flag, 
port captains, port pilots and 
airfields commanders NT CBTS Restricted to Mexicans by birth. 
Minorities NT/LP CBTS Any measure granting rights or  preferences to disadvantaged social or 
economic groupings. 
Social services - law execution, 
social readaptation, retirement 
pensions, unemployment insurance, social security, social welfare, 
public education, public training, 
health and childcare NT/LP CBTS Any measure related to these services maintained for reasons of 
public interest. 
Note: CBTS:  Cross-border trade in services;  I:  Investment;  LP:  Local presence re quirements;  MFN:  Restriction to MFN trea tment;  
NT:  National treatment restriction;  SMBD:  Senior manageme nt and Boards of Directors restriction;  PR:  Performance 
requirements. 
a In the case of Mexico's reservations, a "concession" means an authorization provided by the State to a person to exploit a na tural 
resource or provide a service, for which Mexican nationals a nd Mexican enterprises are granted priority over foreigners.  
Source : Annex I to the Costa Rica-Mexico FTT.  WT/REG218/2/Rev.1 
 Page 45 
 
 
  116. Economic activities reserved for the Parties are listed in Annex II;  Mexico has listed the 
following sectors under monopoly: 
• Crude oil, other hydrocarbons and their derivatives:  exploration, refining, 
production, transport, storage, distribution, wholesale trade and external trade; 
• nuclear energy and treatment of radioactive minerals:  exploration, transformation, 
generation, transport and storage of nucl ear waste, use and reprocessing of nuclear 
fuel, production of heavy water; 
• postal services;  telegraph services;  radiotelegraph services; 
• emission of notes and minting of coins; 
• control, inspection and surveilla nce of maritime and land ports; 
• air traffic control services, aeronautical meteorological services, aeronautical 
telecommunications services, other air-navigation telecommunications-related services; 
• social services:  law execution, social re adaptation, and the following social services 
maintained for reasons of public inter est:  retirement pensions, unemployment 
insurance, social security, social welfare, public education, public training, health and 
childcare; 
• in addition, Mexico has taken national treatment reservations for those sectors that 
were reserved for the State prior to 1992;   these reservations, (equity/nationality 
requirements) were to be relaxed within a three-year period from its application, at 
the end of which national treatment obligati ons apply, but subject to any reservations 
and exceptions under Article 13-8. 
117. All QRs listed in Annex IV apply at the State level.  A horizontal limitation applying to all 
sectors in all but two federal entiti es (Tlaxcala and Zacatecas) applies vis-à-vis  authorizing works or 
activities that might modify the environment, cause ecological disequilibrium or undermine State laws 
and regulations aimed at protecting the environment.  Other State QRs apply in the following sectors:  
(a) wholesale trade and food and beverages;  retaili ng services;  (b) construction services;  (c) health 
services;  (d) private education;  (e) security services;  and (f) land transport services. 
118. Sectoral liberalization under the Treaty goes beyond that under the GATS, encompassing a 
significantly higher number of sub-sectors.
52  Two sectors - namely environmental services and 
recreational, cultural and sporting services - are completely excluded from the GATS but fully liberalized in the Treaty with the exception of hori zontal limitations.  Fina ncial services - generally 
limited to financial intermediation services - are c overed by the GATS but not by the Treaty, while 
the Treaty's limited coverage of air transport services is similar to that in the GATS. 
                                                     
 
52 In the GATS, Mexico has specific commitments in 10 of the 12 GATS sectors;  among these, 
however, commitments cover about half of all sub-sectors.  Mexico participated in the negotiations on basic 
telecommunications and financial services that fo llowed the Uruguay Round, and the corresponding 
commitments are featured in  the Fourth and Fifth GATS Protocols.  Mexico also undertook to abide by the 
Reference Paper on Telecommunications. WT/REG218/2/Rev.1 
Page 46  
 
  119. Various additional business services sub-sectors are liberalized;  reservations - in the form of 
nationality and licensing requirements - may apply in  some sub-sectors of professional services and 
other business services. 
120. As far as communication services are concerne d, postal, telegraph and radiotelegraph 
services - not included in GATS commitments - are reser ved for the State.  Courier services are fully 
liberalized.  As regards telecommunication servi ces, the GATS commitments for which only included 
other value-added services, reservations grant exclus ive rights to the State enterprise for links with 
Intelsat and Inmarsat.  Telecommunications servi ces and public networks require concessions, which 
are reserved for Mexican companies and subject to  general equity requirements, except for mobile 
phone services where the threshold may be increased upon authorization.  In the case of 
telecommunication services and public networks for commercial agencies, the restriction stipulates 
that only a permit (instead of a concession) is re quired and that the company has to be established 
under Mexican law. 
121. Construction services have been fully liberali zed as from 1999, with the exception of the 
construction of pipelines and drillin g of oil and gas wells.  Regarding educational services, equity 
limitations applied under the GATS (49 per cent) may not apply for investments from Costa Rica. 
122. Maritime, inland waterways and rail trans port services, for which Mexico has no GATS 
commitments, are partially liberalized under the Treat y, but remain subject to various restrictions, 
which may reserve some sub-sectors for Mexican nationals (e.g. port workers and loading and 
unloading services).  GATS commitments in road transport services are limited to vehicle maintenance and repair, while under the Treaty th ey cover all sub-sectors, although these may be 
subject to limitations that either reserve certain services for Mexican nationals (e.g. road and bridge 
construction and management services, and local and school bus services) or progressively open up 
certain services to nationals from Costa Rica (e.g . freight transport and long-distance passenger bus 
transport). 
E. R
EGULATORY PROVISIONS ON TRADE IN SERVICES  
1. Domestic regulation 
123. With a view to ensuring that measures relating to qualification requirements and procedures, 
technical standards and licensing requirements do not constitute unnecessary barriers to trade, the 
Treaty provides that each Party should en sure that such measures:  (a) are based on objective and 
transparent criteria, such as  competence and the ability to supply th e service;  (b) are not more burdensome 
than necessary to ensure the quality of the service;  and (c) are not a disguised restriction on the 
cross-border supply of a service (Article 9-12). 
2. Recognition 
124. Article 9-13 makes clear that, in cases where a Party grants recognition to qualifications 
obtained in another country, the Treaty does not oblige the Party to extend such recognition to qualifications obtained in the other Party.  In su ch cases, however, opportunity shall be given for the 
latter to pursue discussions to that end. 
125. Article 9-13 also provides for a three-year tran sition period for the elimination of nationality 
and/or permanent residence requirements to obtain the recognition of qualifications and the granting 
of professional licences for professional services providers of the other Party.  In cases where this is 
not done, the maintenance of an e quivalent requirement in the same  sector and for the same time 
period is allowed, or, alternatively, the Party can  re-establish - subject to prior notification - any 
federal or central requirement previously eliminat ed in accordance with this Article or any State  WT/REG218/2/Rev.1 
 Page 47 
 
 
  requirement in force on the date of the Treaty's entry into force.  Mexico has eliminated the 
nationality and/or permanent residency requirements set forth in this Article, except in respect of 
public notaries and public brokers, for whom a nationalit y requirement continues to exist.  As of June 
2010, Costa Rica continues to impose this type of requirement.   The Annex to Article 9-13 sets out 
the rules to be observed by the Parties in order to  reduce and gradually eliminate the barriers to the 
provision of professional services that exist in their territory. 
V. GENERAL PROVISIONS OF THE TREATY 
1. Transparency 
126. Transparency obligations are addressed in Chapte r XV.  Each Party must establish an enquiry 
point to facilitate the exchange of information on  any matter related to the Treaty (Article 15-01).  
The Parties are required to promptly publish or ma ke available their laws, regulations, procedures and 
administrative rulings of general application (Artic le 15-02).  An appeal mechanism must also be 
maintained by the Parties through their tribunals  and juridical and administrative procedures 
(Article 15-04). 
2. Current payments and capital movements 
127. Article 13-09 provides that a Party will allow tran sfers related to investments in one Party by 
an investor from another Party to take place free of barriers and without delay.  Transfers may be made in convertible currencies, at market rates of  exchange.  In certain cases, and provided national 
legislation is applied in a fair and non-discriminat ory manner, transfers may however be prohibited;  
these include:  bankruptcy;  securities emission, tr ade and operations;  penal or administrative 
infractions;  forwarding transfers of currency or other monetary instruments;  ensuring the 
enforcement of judgements or awards in the even t of a dispute;  and mechanisms for ensuring the 
payment of taxes. 
128. Temporary limitations may be imposed on transfers in cases of exceptional or serious 
balance-of-payments difficulties.  Any such li mitation has to be applied in a fair and 
non-discriminatory manner in accordance with internationally accepted criteria.  Its application and 
withdrawal are to be promptly notified to the other Party. 
3. Exceptions 
129. General exceptions are listed in Chapter XVIII.   Article 18-01 incorporates GATT Article XX 
and its interpretative notes with respect to:  (a) trad e in goods (Second Part), except where it applies to 
services and investment;  and (b) technical barriers to  trade (Fourth Part), except where it applies to 
services.  General exceptions relating to trade in  services are included in the Trade in Services 
Chapter, Article 9-16.  Provided that they are not  applied in a manner constituting a means of arbitrary 
and unjustifiable discrimination between countries wh ere the same conditions prevail, exceptions are 
established for the protection of morals and public orde r;  for the protection of human, animal or plant 
life or health;  for implementing international agr eements aiming at preserving the environment;  the 
protection of national treasures of artistic, historic or  archaeological value;  for fiduciary reasons;  or 
for ensuring compliance with rules or regulations  not inconsistent with the Treaty's provisions, 
including on deceptive and fraudulent practices. 
130. Nothing in the Treaty's Second, Third and Fourth Parts (respectively trade in goods, trade in 
services, and TBT) shall prevent the Parties fro m adopting or implementing measures necessary to 
ensure the application of laws and regulations with  respect to public health, security and consumer 
protection, providing that such measures are co mpatible with the Treaty, are applied in a 
non-discriminatory manner and do not constitute unnecess ary barriers to trade.  Security exceptions, WT/REG218/2/Rev.1 
Page 48  
 
  which mirror those of the WTO, and prohibitions on  the disclosure of information are contained in 
Articles 18-02 and 18-03, respectively. 
4. Accession 
131. Article 19-05 allows any Central American c ountry or group of countries to accede to the 
Treaty in accordance with the terms and conditions agreed between the interested country and the 
Treaty's Commission and in conformity with national juridical procedures.  The accession will take 
effect once the completion of intern al procedures has been notified. 
5. Institutional framework 
132. Under Article 16-01, the Parties have estab lished an Administrative Commission for the 
administration of the Treaty.  The Commission consists  of representatives of Costa Rica's Ministry of 
External Trade and of Mexico's Ministry of Comme rce and Industrial Development (now Ministry of 
the Economy) (Annex 16-01).  It convenes once a year  in ordinary session and, upon request by any 
Party, in extraordinary session. 
133. The Commission will establish and supervise the Se cretariat (Article 16-02).  Each Party is 
required to designate its national permanent office a nd to provide for its operation and costs.  The 
Secretariat's functions are to assist the Commission;  to provide administrative support to arbitral 
tribunals;  and, upon instruction by the Commi ssion, to support the wo rk of other committees 
established under the Treaty. 
6. Dispute settlement 
134. The dispute settlement mechanism is described in Chapter XVII.  The Parties endeavour to 
achieve a mutually satisfactory solu tion to any dispute arising from the interpretation or application of 
the Treaty (Article 17-01).  Disputes can be solv ed either through the mechanism established under 
the Treaty or under the GATT;  once the forum has been  selected, it must be used to the exclusion of 
others (Article 17-03).  According to Article 17-04, in disputes relate d to perishable goods, the Parties 
may reduce the time-frames established in the Chapter.  Table V.1 provides a synopsis of the dispute 
settlement provisions of the Treaty. 
135. A Party may request, in writing, consultations w ith the other Party on any measure adopted or 
to be adopted that may affect the functioning of th e Treaty.  The request for consultations is to be 
addressed to the Secretariat's national section and to the other Party (Article 17-06).  If the Parties fail 
to reach an agreement through consultations, they may request, within 45 days of the submission of 
the request for consultation, the intervention of  the Commission.  The Commission shall convene 
within ten days.  WT/REG218/2/Rev.1 
 Page 49 
 
 
  Table V.1 
Synopsis of the Dispute Settlement Provisions under the Treaty 
Consultations  
(Art. 17-05) 
Request for establishment of AT (Art. 17-07) 
Provisional AT report  (Art. 17-13) Composition of AT (Art. 17-10) 
90 days  
Final AT report (Art. 17-14:1) Referral to Commission (Art. 17-06)  
Meeting of the Commission (within 10 days) 
AT examination  (Art. 17-11/17-13 ) 
Implementation  (Art. 17-16) 
Possibility of retaliation upon 
authorization by AT (Art. 17-16) Recourse to AT by a Party 
(Art. 17-16:4) 
AT determination (Art. 17-16:5) Comments by Parties  (Art17-13:4) 
Time-frame as in award  15 days 
60 days from constitution of AT  Technical consultations  
(Art. 4-25, 5-25, 11-20) 
Good offices, conciliation, mediation  (Art. 17-06:4(b)) Technical advice requested (Art. 17-06:4(a)) 
Issue of recommendations  (Art. 17-06:4(c)) 
14 days 
Transmittal to the 
Commission  (Art. 17-14:3) Publication 
(Art. 17-14:3) Max. 30 days Max. 45 days Max. 30 days 
Max. 35 days 
Max. 30 days 
15 days 
 WT/REG218/2/Rev.1 
Page 50  
 
  136. If the Commission fails to resolve the dispute w ithin 45 days, a Party may request, in writing, 
the establishment of an Arbitral Tribunal (AT).  The Commission will set up the AT (Article 17-08) and decide on its rules of procedure (Article 17-11).  The AT will consist of five members, selected 
from a roster of 20 arbitrators appointed by both Parties for a period of three years (with the possibility of re-election);  the roster must also include non-nationals of the Parties.  The AT will 
issue its preliminary decision within 90 days from its constitution (Article 17-13).  The Parties have 
14 days to provide the tribunal with written comment s on the preliminary decision.  The final decision 
must be sent to the Commission within 30 days from the submission of the preliminary decision;  it is 
binding on the Parties and must be executed in accordance with the terms and conditions established 
therein.  If the final decision rules that a measu re is incompatible with the Treaty, the Party 
complained against must refrain from implementing it or  revoke it;  if the final decision rules that the 
measure causes nullification or impairment, it will sugg est a satisfactory adjustment for both Parties.  
The complaining Party may suspend the benefits gr anted under the Treaty to the other Party when the 
tribunal concludes that:  (a) the measure is incomp atible with the Treaty obligations and the Party 
complained against does not comply with the fina l decision within the deadline established by the 
tribunal;  or (b) the measure causes nullification or impairment and the Parties do not reach a mutually 
satisfactory solution (Article 17-16).  The suspension of benefits will last until the Party complained 
against complies with the tribunal's final decision or the Parties find a mutually satisfactory solution.  Upon request by a Party, the Administrative Commi ssion shall establish an AT to determine whether 
the level of benefits suspended is excessive;  the AT  shall issue its final decision within 60 days from 
its constitution or by any other deadline est ablished by the Parties (Article 17-16(5)). 
137. Article 17-18 provides for alternative proce dures for the settlement of private commercial 
disputes.  To this end, each Party must promote and facilitate arbitration or other procedures in 
conformity with the United Nations Convention on the Recognition and Enforcement of Foreign 
Arbitral Awards (1958) or the Inter-American C onvention on International Commercial Arbitration 
(1975).  The Commission can also establish an  "Advisory Committee on Private Commercial 
Disputes", consisting of experts on the issue, th at will submit reports or recommendations to the 
Commission on the existence, use or effectiven ess of arbitration or other dispute settlement 
procedures. 
7. Relationship with other agreements concluded by the Parties 
138. In 1963, Costa Rica signed the General Treaty on Central American Economic Integration 
which established the Central American Common Ma rket (CACM);  it has also signed the two legal 
instruments that updated the General Treaty, namely  the Tegucigalpa Protocol - which created the 
Central American Integration System, aimed at achi eving effective Central American integration - and 
the Guatemala Protocol - defining the objectives,  principles and measures for achieving a Central 
American Economic Union.
53  As of July 2009, intra-regional trade was free with respect to all 
originating products except those included in Annex A to the General Treaty54;  the common external 
tariff - which encompasses 6,389 tariff lines excluding vehicles and provides for tariff levels at rates 
of 0, 5, 10 and 15 per cent - was harmonized for 95. 7 per cent of the items with exceptions applying to 
products such as medicines, metals, petr oleum and certain agricultural products, inter alia .55 
                                                      
53 Both instruments were also signed by Panama, but to date that country has ratified and put into force 
only the Tegucigalpa Protocol. 
54 Sugar and unroasted coffee for all five countries, petroleum derivates between El Salvador and 
Honduras, ethylic alcohol between El Salvador and Honduras and Costa Rica, distilled alcohol beverages 
between El Salvador and Honduras, and roasted co ffee between Costa Rica and the other countries. 
55 Figures extracted from the report of the Centra l American Economic Integration Secretariat on the 
Central American Customs Union, available online at  http://www.sieca.org.gt/site/VisorDocs.aspx?IDDOC= 
Cache/17990000003052/17990000003052.swf.  WT/REG218/2/Rev.1 
 Page 51 
 
 
  139. The Treaty on Investment and Trade in Serv ices between the Republics of Costa Rica, 
El Salvador, Guatemala, Honduras and Nicaragua  was signed on 24 March 2002, and entered into 
force on 6 January 2006 in some of these countries;  as of September 2010, it was in force in all of the 
countries except Costa Rica, where ratification is still pending.  The objectives of the Treaty are to 
(a) establish a legal framework for the liberalizat ion of trade in services and for investments, 
consistent with the General Treaty, the GATS,  and other relevant b ilateral and multilateral 
instruments;  (b) encourage the expansion and dive rsification of trade in services and investment;  
(c) facilitate the circulation of services;  (d) promot e, protect and increase substantially investments in 
each Party;  and (e) create efficient procedures for Treaty application and administration and for 
dispute settlement.  The Treaty liberalized services through a negative list approach, and the Parties 
agreed to complete the lists of reservations follow ing its signing;  these had not been completed at 
entry into force, but were established subsequently. 
140. Five years later, on 22 February 2007, a Pr otocol amending the Treaty was signed by the 
same parties.  The Protocol was drafted in order to  adapt the previously negotiated instrument to other 
related instruments concluded after the Treaty;  it al so includes the lists of exceptions and reservations 
of all Parties.  As at June 2010, the Protocol w as in force for El Salvador, Guatemala and Honduras;  
ratification by Costa Rica and Nicaragua  is still pending. 
141. Article 3-04(4) indicates that those preferences negotiated in the context of the Second 
Protocol to the Partial Scope Agreement between Me xico and Costa Rica have been integrated into 
the Treaty, and therefore these became inactive as from the entry into force of the Treaty.56 
142. Mexico has signed agreements similar to this Tr eaty with Costa Rica's partners in the CACM, 
namely one with Nicaragua and the other with th e Northern Triangle countries - i.e. El Salvador, 
Guatemala and Honduras.57 
143. All RTAs signed by Costa Rica and Mexico which are in force as of October 2009 are listed 
in Table V.2 below. 
                                                      
56 Agreement concluded under Article 25 of the Treaty of Montevideo, the basic instrument 
establishing the Latin American Integration Association.   While this Agreement has not been notified to the 
GATT/WTO, information on the original 1982 Agreement and on the Additional Protocols has been regularly 
submitted by the LAIA Secretariat in the context of the biennial reports ;  the most recent information was 
submitted in WT/COMTD/7 of 30 September 1996. 
57 All of these have also been subject to Factual Presentations, see WT/REG212-214/2 of 6 July 2009, 
and WT/REG260/3, forthcoming. WT/REG218/2/Rev.1 
Page 52  
 
  Table V.2 
Participation in other RTAs (notified a nd non-notified in force), as of July 2009  
GATT/WTO Notification Partner/Agreement Date of entry 
into force Type of agreement 
Year WTO provision 
COSTA  RICA 
Panama 23.11.08 Goods and Services 2009 GATT Art.  XXIV and GATS Art.  V
CAFTA-DR 01.03.06 Goods and Services 2006 GATT Art.  XXIV and GATS Art.  V
Canada 01.11.02 Goods 2003 GATT Art.  XXIV 
Chile 15.02.02 Goods and Services 2002 GATT Art.  XXIV and GATS Art.  V
CACM 29.07.63 Goods 1961 GATT Art.  XXIV 
CARICOM 15.11.05 Goods Not notified  
Dominican Republic 07.03.02 Goods Not notified 
MEXICO 
Japan 01.04.05 Goods and Services 2005 GAT T Art.  XXIV and GATS Art.  V 
Honduras 01.06.01 Goods and Services 2006 GATT Art.  XXIV and GATS Art.  V 
El Salvador 15.03.01 Goods and Services 2006 GATT Art.  XXIV and GATS Art.  V 
Guatemala 15.03.01 Goods and Services 2006 GATT Art.  XXIV and GATS Art.  V 
     
EFTA 01.07.01 Goods and Services 2001 GATT Art.  XXIV and GATS Art.  V 
EC 01.10.00 Services 2002 GATS Art.  V 
EC 01.07.00 Goods 2000 GATT Art.  XXIV 
Israel 01.07.00 Goods 2001 GATT Art.  XXIV 
Chile 01.08.99 Goods and Services 2001 GATT Art.  XXIV and GATS Art.  V 
Nicaragua 01.07.98 Goods and Services 2005 GATT Art.  XXIV and GATS Art.  V 
Colombia* 01.01.95 Goods and Services 2010 GATT Art.  XXIV and GATS Art.  V 
NAFTA 01.04.94 Goods and Services 1993 GATT Art.  XXIV and GATS Art.  V 
GSTP 19.04.89 Goods 1989 Enabling Clause 
LAIA 18.03.81 Goods 1982 Enabling Clause 
PTN 11.02.73 Goods 1971 Enabling Clause 
Bolivia** 10.06.10 Goods Not notified 
Uruguay 15.07.04 Goods and Services Not notified 
* Originally, the "Group of Three", which also included Venezu ela.  Since 19 November 2006, only Mexico and Colombia are 
members. 
** The FTA between Mexico and Bolivia, signed in 1994 a nd in force since 1 January 1995, expired on 7 June 2010. 
Source : WTO Secretariat.  
CAFTA-DR: Dominican Republic-Central America-United States - in  force for the Dominican Republic, El Salvador, Guatemala, 
 Honduras, Nicaragua and the United States. 
CACM:  Central American Common Market 
CARICOM: Caribbean Community and Common Market EFTA:   European Free Trade Area 
NAFTA:  North American Free Trade Agreement 
GSTP:   Global System of Trade Preferences LAIA:  Latin American Integration Association 
PTN: Protocol relating to Trade Ne gotiations among Deve loping Countries  WT/REG218/2/Rev.1 
 Page 53 
 
 
  8. Government procurement 
144. Chapter XII and related annexes contain disci plines on government procurement.  The Treaty 
covers procurement of goods, services and cons truction services by central entities (listed in 
Annex 1), public companies (Annex 2) and sub- central entities (Annex 3).  Annex 4 lists goods 
procured by specific entities58 that are excluded from the Chapter's coverage.  These include:  
weapons;  nuclear ordnance;  fire-c ontrol equipment;  ammunitions a nd explosives;  guided missiles;  
aircrafts and airframe structural components;  aircraft launching, la nding and ground-handling 
equipment;  space vehicles;  ships, small craft,  pontoons, and floating doc ks;  ships and marine 
equipment.  Annexes 5 and 6 (respectively Lists of se rvices and of construction services) specify that 
Chapter XII will apply to procurement of servi ces and construction services only once the list of 
reservations in services - i.e. Annexes I to IV - is  in force;  pending that, each Party will apply its 
existing legislation at the time of the Treaty's entry into force.59  Annex 7 includes the formula for 
adjusting the thresholds, Annex 8 establishes a tr ansitional mechanism for procurement by specific 
entities listed by Mexico and for procurement of pharmaceutical goods, and Annex 9 contains 
additional exceptions to government procurement provisions under the Treaty.60  Within one year 
from the Treaty's entry into force, Parties are to  establish a common system for the classification of 
services and of construction services. 
145. Thresholds vary for different groups of en tities according to the nature of purchases (goods, 
services, or construction services) and are based on the US rate of inflation;  they are to be adjusted every two years starting on 1 January 1997.  For procurement of goods and services by central entities, the threshold shall be US$50,000 and above;  for procurement of construction services it shall 
be US$6.5 million and above.  In the case of public companies, the threshold shall be US$250,000 
and above for goods and services and US$8 million fo r construction services (Article 12-02).  The 
threshold for procurement by sub-central entities is subject to future negotiations pursuant to 
Article 12-24. 
146. National treatment and non-discrimination principl es are contained in Article 12-04.  Benefits 
granted under this Chapter may be denied to a services supplier of a Party, upon notification and 
consultations, when the other Party determines that the service is provided by an enterprise that does 
not have important business activities in its territory  and the enterprise is owned or controlled by 
persons of a non-party (Article 12-06). 
147. Tendering procedures are described in Section B of Chapter XII.  They may be open, 
selective or limited, providing that all these methods  guarantee fair competition (Article 12-09).  
Under Section C, each Party must establish and main tain an administrative challenge procedure for 
procurement activities covered under the Treaty (Artic le 12-17).  The Parties ar e required to set up an 
impartial and independent review body with no interest in the out come of the procurement activities.  
Exceptions to the Chapter's provisions are detailed in  Article 12-18.  Neither Party is required to 
                                                     
 
58 These entities are:  for Costa Rica, the Ministry of Governance ( Ministerio de la Gobernación ), 
municipalities and the Ministry of Security ( Ministerio de Seguridad );  for Mexico, the Ministry of National 
Defence ( Secretaría de la Defensa Nacional ) and the Ministry of the Navy ( Secretaría de Marina ). 
59 Modifications of coverage is limited to exceptional circumstances, and requires compensation.  
However, formal modifications or minor amendments to Annexes 1 to 6, 8 and 9 and to Article 12-02 are allowed upon notification to the other Party;  in the absence of objections within 30 days, compensation is not 
required. 
60 Including procurement made with the aim of commercial resale by governmental stores;  in 
conformity with multilateral and regional financial ins titutions, to the extent that  these instruments accord 
different procedures;  and between national entities.  Proc urement of transportation serv ices, which are part of a 
contract or are connected with it, and procurement realized pursuant to security exceptions (safeguard of nuclear 
material and technology) are also exem pted from the Chapter's obligations.  Mexico shall also exempt contracts 
which account for 5 per cent of its total procurement contracts per year. WT/REG218/2/Rev.1 
Page 54  
 
  provide information contrary to its essential in terests with regard to the purchase of arms, 
ammunitions or war material, or to any other c ontract necessary for ensuring national security or 
national defence.  A general exception, in line with Article XX of the GATT, also applies. 
148. Each Party shall ensure transparency in its respective laws, regulations and administrative 
rulings of general application.  The Parties end eavour to cooperate in or der to achieve a better 
understanding of their public procurement system s and to facilitate access for their respective 
suppliers;  to this end, each Party will provide the other Party and its suppliers information on training 
and guidance programmes on public procurement.  Under Article 12-21, th e Parties established a 
"Committee for Micro, Small and Medium Enterp rises (SMEs)" with the objective of promoting 
procurement opportunities in their respective mark ets.  Government procurement provisions are 
subject to dispute settlement provisions under the Treaty.  Article 12-24 provides for future 
negotiations on government procurement;  in pa rticular, it recalls the importance of including 
procurement by sub-central entities in the Chapter. 
9. Intellectual property rights 
149. Provisions on intellectual property rights (IPRs) are contained in Chapter XIV.  Each Party 
grants to nationals of the other Party protection of IPRs in its territory and ensures that measures for 
IPR protection do not constitute unnecessary barriers to trade (Article 14-02).  In addition, the Parties 
undertook to implement, at least,  all international conventions on IPRs listed under Article 14-03;  
Costa Rica endeavours to accede as soon as possible, but no later than 18 months from the Treaty's 
entry into force, to the Paris Convention (1967) a nd, no later than three years from the Treaty's entry 
into force, to the Lisbon Ag reement for the Protection of Appellations of Origin and their 
International Registration (1967) (Annex 14-03).  Costa Rica ratified the Paris Convention for the 
Protection of Industrial Property in 1995 and the Lisbon Agreement for the Protection of Appellations 
of Origin and their International Registration in 1996. 
150. National treatment is granted to nationals of the Parties, with the exception of reservations 
provided for in the Berne Convention (1971), the Ro me Convention (1961), and the Paris Convention 
(1967) (Article 14-04).  Neither Party may accord nati onal treatment to nationals of the other Party on 
the condition that they comply with formalities to obtain copyright or related rights.  Exceptions to 
national treatment with regard to judicial and ad ministrative procedures for the protection and defence 
of IPRs - including the designation of an address for service or the appointment of an agent in a 
Party's territory - are admitted only when they are necessary to comply with measures not inconsistent 
with the Chapter's provisions and when they do not restrict trade between the Parties (Article 14-05).  
Most-favoured-nation treatment is immediately and unconditionally granted to nationals of the 
Parties, except when any advantage, favour, privile ge or immunity is granted by a Party (i) under 
international agreements on judicial assistance and on observance of a law of general application not 
limited to the protection of IPRs;  (ii) pursuant to the provisions of the Berne Convention (1971) and 
the Rome Convention (1961);  or (iii) to rights-hol ders not covered under the Treaty (Article 14-06). 
151. IPRs covered under the Treaty are:  trademarks;  geographical or origin indications and 
appellation of origin;  and copyright and related rights.  The Parties undertake to protect encrypted programme-carrying satellite signa ls from unauthorized decoder activities within one year from the 
Treaty's entry into force (Article 14-32).  Registrati on of trademarks is granted for ten years from the 
date of the request or its concession, and can be re newed for ten years indefinitely (Article 14-14).  
Exceptions to trademarks-related rights are permitted  on the condition that they take into account 
right-holder and third-party interests;  situations where a Party may deny registration of trademarks 
are detailed in Articles 14-09(2) and 14-11.  Prot ection of geographical indications and denomination 
of origin is granted under Article 14-18.  Copy rights covered under the Treaty are those listed in 
Article 2 of the Berne Convention (1971), and incl ude computer programmes and compilation of data 
(Article 14-20).  The protection of copyright is granted for the author's life and no less than 50 years  WT/REG218/2/Rev.1 
 Page 55 
 
 
  after the author's death, in line with the TRIPS Ag reement.  Protection of IPRs may be extended to 
categories listed in Article 14-26 (publications, fic titious or symbolic characters, artistic characters 
and professional names, original commercial art and advertising, inter alia ), as established in the 
legislation of each Party. 
152. Civil and administrative procedures and remedi es are addressed in Article 14-28;  they 
include, inter alia , the application of precautionary measures.   Criminal procedures and penalties are 
provided for in cases of wilful trademark counterfeiting or copyright piracy on a commercial scale.  WT/REG218/2/Rev.1 
Page 56  
 
  ANNEX I 
 
Products which Remain Dutiable under the Treaty
 
  
1. A comparison between preferential tariffs applied under the scheduled elimination 
programmes of each Party and the MF N applied duties, by total, agricultural (WTO definition) and 
non-agricultural products, is shown in Tables AI.1  (Costa Rica) and AI.2 (Mexico).  Applied 
MFN duty rates in 1995 serve as a comparison. 
2. In 1995, Costa Rica had a variable tariff struct ure and no tariff lines were duty free on an 
MFN basis.  Its (unweighted) average MFN rate wa s 13.3 per cent on all goods, with the tariff for 
agricultural goods being on average two-thirds high er than for non-agricultural products.  Upon the 
entry into force of the Treaty, Mexico's exporters enjoyed a relative margin of preference of 79.3 per 
cent on non-agricultural products vis-à-vis  the prevailing average MFN tariff in 1995, and a relative 
margin of preference of 82.6 per cent on agricultural goods.  At entry into force, the share of duty-free 
lines increased to 73.3 per cent of all products.  By the end of the transition period in 2009, the 
average tariff faced by Mexico's e xporters on all products is  set to be 0.9 per cent, with the share of 
duty-free tariff lines increasing to 98.2 per cent.  Ho wever, the average applied rate on lines which 
continue to be dutiable after the implementation of the Treaty is 50.2 per cent, and, at 52.4 per cent, 
higher for agricultural products. 
Table AI.1 
Costa Rica:  Indicators of MFN tariff rates a nd preferential rates for imports from Mexico 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 1995 13.3 13.3 0.0 20.1 20.1 0.0 12.1 12.1 0.0 
Mexico 1995 4.1 15.3 73.3 13.5 23.9 43.6 2.5 11.7 78.5 
 1996 3.6 13.4 73.3 12.4 21.9 43.6 2.1 9.8 78.5 
 1997 3.1 11.5 73.3 11.3 20.0 43.6 1.7 7.9 78.5 
 1998 2.5 9.6 73.3 10.1 18.0 43.6 1.3 6.0 78.5 
 1999 2.0 13.1 84.5 9.0 24.3 62.8 0.9 7.5 88.3 
 2000 1.8 11.8 84.5 8.6 23.0 62.8 0.7 6.1 88.3 
 2001 1.6 10.4 84.5 8.1 21.7 62.8 0.5 4.7 88.3 
 2002 1.4 9.1 84.6 7.6 20.5 62.9 0.4 3.3 88.4 
 2003 1.2 7.7 84.6 7.1 19.1 62.9 0.2 1.9 88.4 
 2004 1.0 39.4 97.6 6.5 51.4 87.3 0.1 7.0 99.2 
 2005 1.0 39.0 97.6 6.5 51.3 87.3 0 6.0 99.2 
 2006 0.9 38.6 97.6 6.5 51.1 87.3 0 5.1 99.2 
 2007 0.9 38.2 97.6 6.5 50.9 87.3 0 4.2 99.2 
 2008 0.9 37.8 97.6 6.4 50.6 87.3 0 3.2 99.2 
 2009 0.9 50.2 98.2 6.4 52.4 87.8 0 14.3 99.9 
a WTO definition. 
Source : WTO Secretariat estimates based on data provided by Costa Rica. 
3. In 1995, Mexico had a variable MFN tariff structure.  Its (unweighted) average MFN tariff 
(1995) was 13.4 per cent, with the average for agricu ltural products reaching 19.9 per cent and that for 
industrial products 12.8 per cent.  Mexico's share of duty-free lines at the MFN level was 9 per cent in 1995.  On entry into force of the Treaty, Costa Rica's exporters enjoyed a relative margin of 
preference of 91.4 per cent on non-agricultural products vis-à-vis  the prevailing average MFN tariff in  WT/REG218/2/Rev.1 
 Page 57 
 
 
  1995, and a relative margin of preference of 32. 7 per cent on agricultural goods.  The share of 
duty-free lines for all products increased to 83 per cen t.  By the end of the transition period in 2009, 
the average tariff faced by Costa Rica's exporters on all products is set to be 0.6 per cent, with the 
share of duty-free tariff lines increasing to 98.9 per cen t.  However, in that same year, the average 
applied tariff on those lines which remain dutiable is 58.6 per cent, and 64.2 per cent for agricultural 
products. 
Table AI.2 
Mexico:  Indicators of MFN tariff rates and preferential rates for imports from Costa Rica 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 1995 13.4 14.7 9.0 19.9 22.0 9.5 12.8 14.1 9.0 
Costa Rica 1995 2.2 13.0 83.0 13.4 25.2 46.2 1.1 8.4 86.7 
 1996 1.9 11.4 83.0 12.5 23.4 46.2 0.9 6.9 86.7 
 1997 1.7 9.9 83.0 11.5 21.6 46.2 0.7 5.5 86.7 
 1998 1.4 8.3 83.0 10.6 19.8 46.2 0.5 4.0 86.7 
 1999 1.1 11.6 90.1 9.6 25.8 62.3 0.3 4.8 92.9 
 2000 1.0 10.6 90.1 9.1 24.4 62.3 0.3 3.9 92.9 
 2001 0.9 9.5 90.1 8.5 22.9 62.3 0.2 3.0 92.9 
 2002 0.9 9.0 90.2 8.5 22.9 62.3 0.2 2.2 93.0 
 2003 0.8 7.8 90.2 7.9 21.3 62.3 0.1 1.3 93.0 
 2004 0.6 56.7 98.8 7.2 64.2 87.9 0.0 14.1 99.8 
 2005 0.6 56.2 98.8 7.1 63.7 87.9 0.0 13.9 99.8 
 2006 0.6 55.7 98.8 7.1 63.3 87.9 0.0 12.4 99.8 
 2007 0.6 55.4 98.8 7.0 62.9 87.9 0.0 12.3 99.8 
 2008 0.6 54.3 98.8 6.9 61.7 87.9 0.0 12.0 99.8 
 2009 0.6 58.6 98.9 6.9 64.2 88.4 0.0 14.5 99.9 
a WTO definition. 
Note: Excludes data beyond HS Chapter 97.  
 Tariff lines subject to in-quota rates are excluded in the com putation;  for the calculation of averages, specific rates are e xcluded 
and the ad valorem  part of alternate rates are included. 
Based on the HS 1992 nomenclature. 
Source : WTO Secretariat estimates based on data provided by Mexico. 
4. Mutual market access conditions for each c ountry's top 25 exports in the 1992-1994 (data 
only available for 1994 for Mexico) and 2005-2007 periods are presented in Tables AI.3 to AI.61, 
together with an indication of the year in which du ty-free treatment was to be granted.  The code and 
product description are given at the six-digit level.   The tables also show the number of tariff lines 
covered by the products concerned. 
5. Table AI.3 shows the market access conditions in Costa Rica for Mexico's top 25 exports, 
covering 60 tariff lines, and which in 1992-1994 account ed for 43.9 per cent of its global exports.  
Although none of these products will  be subject to the longest transition period of 15 years, one 
product will remain dutiable at the end of the transition period.  As Costa Rica had no MFN duty-free lines at entry into force, all tariff lines were subject to duties on an MFN basis.  Ten products, 
accounting for 12 tariff lines and 9.1 per cent of Mexico's global exports, became duty free upon the 
entry into force of the Treaty;  eight further products - corresponding to 20 lines
2 and 15.8 per cent of 
                                                      
1 Two periods are presented given the period of time that has elapsed between the Treaty's entry into 
force and the preparation of  the Factual Presentation. 
2 For two products, one line wa s became duty free in 1994. WT/REG218/2/Rev.1 
Page 58  
 
  global exports - became duty free in 1999, a nd 6 products - corresponding to 20 lines and 18.4 per 
cent of global exports - became duty free in 2004;  one product - coffee, accounting for 0.6 per cent of 
Mexico's global exports - will remain dutiable at an MFN rate of 17.5 per cent.  The margin of 
preference granted to Mexico by Costa Rica under the Treaty ranges from 6 per cent to 21 per cent. 
Table AI.3 
Costa Rica:  Market access opportunities under the Treaty for Mexico's top 25 exports in 1992-1994 
Access conditions to Costa Rica's import markets  Mexico's top export products in 1992-1994  
MFN (1995)  Duty free in  
HS number and description of the product  Share in 
global 
exports MFN 
average
(%) No. of 
dutiable 
tariff lines1995 1999 2004 
Remain 
Dutiable  
270900 Petroleum oils and oils obtained from 
bituminous minerals, crude3 12.9 10.0 1   1  
870323 Of a cylinder capacity exceeding 1 500 cc 
but not exceeding 3 000 cc 5.6 21.0 3  3   
852810 Colour 3.6 15.0 2  2   
840734 Of a cylinder capacity exceeding 1 000 cc 2.6 6.0 1 1    
854430 Ignition wiring sets a nd other wiring sets of 
a kind used in vehicles, aircraft or ships 2.4 10.0 1   1  
870322 Of a cylinder capacity exceeding 1 000 cc 
but not exceeding 1 500 cc 2.3 21.0 3  3   
852990 Other 1.8 15.0 2 1 1   
854441 Fitted with connect ors 1.1 20.0 1   1  
852739 Other 1.0 15.0 2 2    
847330 Parts and accessories of the machines of 
heading No 8471 0.9 6.0 1 1    
870829 Other 0.9 11.0 1 1    
854800 Electrical parts of machinery or apparatus, 
not specified or included elsewhere in this 
chapter 0.8 10.0 1 1    
392690 Other4 0.8 8.2 10 1 1 8  
870821 Safety seat belts 0.7 11.0 1 1    
010290 Other: 0.7 10.0 1  1   
870431 Of a gross vehicle weight not exceeding 
5 tonnes 0.7 21.0 5  5   
870421 Of a gross vehicle weight not exceeding 
5 tonnes 0.6 21.0 5  5   
070200 Tomatoes, fresh or chilled 0.6 15.0 1   1  
847120 Digital automatic data processing machines, 
containing in the same housing at least a central processing unit and an input and 
output unit, whether or not combined 0.6 6.0 1 1    
870899 Other 0.6 11.0 1 1    
853650 Other switches5 0.6 13.3 8   8  
090111 Not decaffeinated 0.5 17.5 4    4 
852721 Combined with sound recording or 
reproducing apparatus 0.5 15.0 2 2    
740200 Unrefined copper;   copper anodes for 
electrolytic refining 0.5 10.0 1 1    
853690 Other apparatus 0.5 6.0 1  1   
 Total  43.9  60 14 22 20 4 
Source : WTO estimates based on data provi ded by Costa Rica and the United Na tions Statistics Division (UNSD), 
Comtrade database . 
                                                      
3 Included in the 1999 acceleration agreemen t;  duty free since its entry into force. 
4 One line (3926.90.99, cassettes and video cassettes without magnetic tape) included in the 1999 
acceleration agreement;  duty free since its entry into force. 
5 See footnote 3 above.  WT/REG218/2/Rev.1 
 Page 59 
 
 
  6. In Table AI.4, the evolution of trade shows th at 12 out of Costa Rica's top 25 exports in 
1992-1994 remain on the list for 2003-2005.  All pr oducts, accounting for 56 tariff lines, became 
duty free by 2004 at the latest.  All three major agricultural exports in 1992-1994 are no longer on the list of Costa Rica's top 25 exports to Mexico in  2003-2005, but beer - which benefited in 2002 from 
duty-free treatment with a margin of preference of  20 per cent - was part of the list in 2003-2005.  
Two textiles products - men's and women's cotton trou sers and shorts - have also become top exports 
(no textile product was among the t op 25 exports in 1992-1994);  both products became duty free on 
the entry into force of the Treaty, thus bene fiting from a 35 per cent margin of preference. 
Table AI.4 
Costa Rica:  Market access opportunities under the Treaty for Mexico's top 25 exports in 2003-2005 
Access conditions to Costa Rica's import markets  
MFN (1995)  Mexico's top export products in 2003-2005  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Number of 
dutiable tariff 
lines  1995 1999 2002 2004 
270900 Petroleum oils and oils obtained from bituminous 
minerals, crude6 11.7 10.0 1    1 
852810 Colour 4.3 15.0 2  2   
870323 Of a cylinder capacity exceeding 1 500 cc but not 
exceeding 3 000 cc 4.1 21.0 3  3   
854430 Ignition wiring sets and other wiring sets of a kind 
used in vehicles, aircraft or ships 2.5 10.0 1    1 
870324 Of a cylinder capacity exceeding 3 000 cc 2.2 21.0 3  3   
847192 Input or output units, whether or not presented with 
the rest of a system and whether or not containing 
storage units in the same housing 1.9 6.0 1 1    
852520 Transmission apparatu s incorporating reception 
apparatus 1.7 10.0 1 1    
870431 Of a gross vehicle weight not exceeding 5 tonnes 1.5 21.0 5  5   
940190 Parts 1.5 10.0 1    1 
847330 Parts and accessories of the machines of heading 
No. 8471 1.4 6.0 1 1    
870829 Other 1.4 11.0 1 1    
870899 Other 1.2 11.0 1 1    
847191 Digital processing units, whether or not presented 
with the rest of a system, which may contain in the 
same housing one or two of the following types of 
unit:  storage units, input units, output units 1.2 6.0 1 1    
271000 Petroleum oils and oils obtained from bituminous 
minerals, other than crude;  preparations not elsewhere specified or incl uded, containing by weight 
70% or more of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the prep arations;  waste oils 1.1 10.7 15    15 
870421 Of a gross vehicle weight not exceeding 5 tonnes 1.0 21.0 5  5   
847120 Digital automatic data processing machines, 
containing in the same housing at least a central 
processing unit and an input and output unit, whether or not combined 1.0 6.0 1 1    
840734 Of a cylinder capacity exceeding 1 000 cc 1.0 6.0 1 1    
870422 Of a gross vehicle wei ght exceeding 5 tonnes but not 
exceeding 20 tonnes 0.8 21.0 3  3   
620342 Of cotton 0.8 35.0 1 1    
853710 For a voltage not exceeding 1 000 volts 0.8 15.0 1  1   
852990 Other 0.8 15.0 2 1 1   
847199 Other 0.7 6.0 1 1    
                                                      
6 See footnote 3 above. WT/REG218/2/Rev.1 
Page 60  
 
  Access conditions to Costa Rica's import markets  
MFN (1995)  Mexico's top export products in 2003-2005  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Number of 
dutiable tariff 
lines  1995 1999 2002 2004 
220300 Beer made from malt 0.7 20.0 1   1  
620462 Of cotton 0.7 35.0 1 1    
852721 Combined with sound recording or reproducing 
apparatus 0.7 15.0 2 2    
 Total  46.8  56 14 23 1 18 
Source : WTO estimates based on data provided by  Mexico and UNSD, Comtrade database. 
7. Table AI.5 shows the market access conditions in Mexico fo r Costa Rica's top 25 exports, 
covering 82 tariff lines, which in 1994 accounted fo r 63.5 per cent of its global exports.  Although 
none of these products will be subject to the longest transition period of 15 years, five products (of 
which two only partially) will remain dutiable at the end of the transition period.  Also, none of them 
benefited from duty-free treatment in Mexico's market  prior to the Treaty's entry into force.  Five 
products, accounting for 14 tariff lines7 and 6 per cent of Costa Rica's global exports, became 
duty free upon the Treaty's entry into force.  In  1999, an additional six products - representing 
31 tariff lines and 5.2 per cent of global exports - be came duty free.  Liberalization will terminate with 
ten products, accounting for 17 tariff lines8 and 11.6 per cent of global exports, becoming duty free in 
2017.  Dutiable products - which included the top tw o exports, namely banana and coffee - will face 
an average MFN rate of 14.4 per cent or 20 per cen t, while sugar (HS 1701.11) will remain subject to 
a specific tariff rate.  The margin of preference granted to Costa Rica by Mexico under the Treaty 
ranges from 8.3 per cent to 35 per cent. 
Table AI.5 
Mexico:  Market access opportunities under the Treaty for Costa Rica's top 25 exports in 1994 
Access conditions to Mexico's import markets  
MFN (1995)  Costa Rica's top export products in 1994  
Number of 
tariff lines  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Duty free 
Dutiable 
1995 
1999 
2004 
Remain Dutiable  
080300 Bananas, including plantains, fresh or dried 24.5 20.0  1    1 
090111 Not decaffeinated 13.9 20.0  1    1 
080430 Pineapples 2.5 20.0  1   1  
080710 Melons (including waterm elons) 1.9 20.0  3  1 2  
711319 Of other precious metal, whether or not plated 
or clad with precious metal 1.7 10.0 1 1 1    
020230 Boneless 1.4 25.0  1   1  
030613 Shrimps and prawns 1.3 20.0  1   1  
170111 Cane sugar 1.3 US$0.39586
/kg.  2    2 
060299 Other 1.3 8.3 1 5 5    
401693 Gaskets, washers and other seals 1.3 13.8  4 4    
060491 Fresh 1.1 20.0  2  2   
300490 Other 1.1 13.7 1 22  22   
620462 Of cotton 1.1 35.0  1 1    
200799 Other 1.0 20.0  5 3   2 
                                                      
7 For two products, one line was already MFN duty free. 
8 Eight tariff lines became duty free at an earlier date.  WT/REG218/2/Rev.1 
 Page 61 
 
 
  Access conditions to Mexico's import markets  
MFN (1995)  Costa Rica's top export products in 1994  
Number of 
tariff lines  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Duty free 
Dutiable 
1995 
1999 
2004 
Remain Dutiable  
160414 Tunas, skipjack and Atlantic bonito 
(Sarda spp.) 1.0 20.0  2   2  
060310 Fresh 0.9 20.0  2   2  
071410 Manioc (cassava) 0.9 10.0  1  1   
020130 Boneless 0.9 20.0  1   1  
071490 Other 0.8 10.0  2  2   
060499 Other 0.7 20.0  2  2   
310229 Other 0.6 10.0  1 1    
210690 Other 0.6 14.4  10 3 2 3 2 
151110 Crude oil 0.6 10.0  2  2   
701090 Other 0.6 15.0  5 2  3  
030410 Fresh or chilled 0.6 20.0  1   1  
 Total  63.5  3 79 20 34 17 8 
Source : WTO estimates based on data provided by  Mexico and UNSD, Comtrade database. 
8. In Table AI.6, the evolution of trade shows that ten out the top 25 exports in 1994 remain on 
the list for 2003-2005.  Three products, of which one partially, will remain subject to duties at the end 
of the transition period.  Of the 25 top exports, onl y seven are agricultural products (in 1994, there 
were 19 agricultural products).  The main produc t of export interest - parts and accessories of 
machinery under HS heading 8471 - already benef ited from an MFN duty-free rate;  the other new 
products on the list were all liberalized at the latest in 2004. 
Table AI.6 
Mexico:  Market access opportunities under the Tr eaty for Costa Rica's top 25 exports in 2003-2005 
Access conditions to Mexico's 
import markets  
MFN (1995)  Costa Rica's top export products in 2003-2005  
Number of 
tariff lines  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Duty free 
Dutiable 
1995 
1999 
2004 
Remain Dutiable  
847330 Parts and accessories of the machines of heading No 8471 15.6 0.0 2      
080300 Bananas, including plantains, fresh or dried 8.5 20.0  1    1 
901839 Other 6.8 13.3 1 5 5    
854211 Digital 4.9 0.0 2      
080430 Pineapples 4.2 20.0  1   1  
090111 Not decaffeinated 3.5 20.0  1    1 
300490 Other 3.1 13.7 1 22  22   
210690 Other 2.2 14.4  10 3 2 3 2 
610821 Of cotton 1.4 35.0  1 1    
080710 Melons (including waterm elons) 1.2 20.0  3  1 2  
620711 Of cotton 1.1 35.0  1 1    
401693 Gaskets, washers and other seals 0.9 13.8  4 4    
401110 Of a kind used on motor cars  (including station wagons and 
racing cars)9 0.9 20.0  1   1  
901890 Other instruments and appliances 0.9 12.5 1 25 25    
                                                      
9 See footnote 3 above. WT/REG218/2/Rev.1 
Page 62  
 
  Access conditions to Mexico's 
import markets  
MFN (1995)  Costa Rica's top export products in 2003-2005  
Number of 
tariff lines  Duty free in  
HS number and description of the product  Share in 
global 
exports Average 
MFN 
applied 
rate 
(%) 
Duty free 
Dutiable 
1995 
1999 
2004 
Remain Dutiable  
851850 Electric sound amplifier sets 0.8 20.0  1 1    
060491 Fresh 0.8 20.0  2  2   
420500 Other articles of leather or of composition leather 0.8 35.0  1   1  
481840 Sanitary towels and tampons, napkins and napkin liners for 
babies and similar sanitary articles 0.8 10.0  3   3  
151110 Crude oil 0.7 10.0  2  2   
060299 Other 0.7 8.3 1 5 5    
853650 Other switches10 0.7 12.9  14  4 10  
854459 Other 0.7 14.4  8   8  
701090 Other 0.7 15.0  5 2  3  
620342 Of cotton 0.6 35.0  1 1    
200919 Other 0.6 20.0  2   2  
 Total  63.2  8 119 48 33 34 4 
Source : WTO estimates based on data provided by  Mexico and UNSD, Comtrade database. 
 
                                                      
10 See footnote 3 above.  
   WT/REG218/2/Rev.1
 Page 63ANNEX II 
 
Products Listed in the Annex to Article 3-03 and Article 3-091 
  
Costa Rica Mexico 
1. Products to which Article 3-03 does not apply  
 
Products covered by Law No. 7356 of 6 September 1993 (State monopoly on crude petroleum and derivatives, asphalt and naphtha), as listed below (in the 
Central American Nomenclature, CAN): 
 2709.00.00  Petroleum oils and oils ob tained from bituminous minerals, crude 
2710   Petroleum oils and oils obtained from bituminous minerals, other 
  than crude;  etc. 2710.00.1  Light oils: 
2710.00.12  Gasoline without antiknock 
2710.00.13  Motor gasoline, leaded 2710.00.14  Motor gasoline with other antiknock 
2710.00.15  Aviation gasoline 
2710.00.19  Other 
2710.00.2  Medium oils, including kerosene: 
2710.00.29  Other 2710.00.3  Heavy oils: 
2710.00.31  Gas oil 
2710.00.32  Fuel oil 2710.00.33  Diesel oil 
2711.00.00  Natural gas (liquefied) 
2711.12.00  Propane 2711.13.00  Butanes 
2711.19.00  Other 
2711.21.00  Natural gas (in gaseous state) 2711.29.00  Other 
2714.90.00  Other (asphalt) 
 Tariff item 2716.00 .00 (Electrical energy),  in accordance with Article 121:14 of the 
Constitution
. 1. Products to which Article 3-03 does not apply  
 
Until 1 January 2006, products covered by the Decree for the Promotion and Modernization of the Automotive Industr y (of 11 December 19 89), including any 
extension or modification thereof. 
                                                      
1 As indicated in the Treaty, descrip tions associated with the relevant ta riff are for reference purposes only.  
  WT/REG218/2/Rev.1 
Page 64 Costa Rica Mexico 
2. Products to which Article 3-09 does not apply  
 
Products under CAN headings 6309 (worn clothing and other worn articles) and 6310 (used or new rags, scrap twine, cordage, rope and cables and worn-out articles 
of twine, cordage, rope or cables, of textile materials). 
 All products listed under (1) above, plus CAN 4012.10.00 (retreaded tyres) and 
CAN 4012.20.00 (used tyres). 
 
Used goods of the tariff codes listed below: 
8702 Motor vehicles for the transport of ten or more persons, including the driver. 
8703 Motor cars and other motor vehicles principally designed for the transport of 
 persons (other than those of heading 8702), including station wagons and 
 racing cars. 8704  Motor vehicles for the transport of goods. 
8705  Special-purpose motor vehicles, other than those principally designed for the 
 transport of persons or goods (for example, breakdown lorries, crane lorries,  fire-fighting vehicles, concrete-mixer lorries, road sweeper lorries, spraying 
 lorries, mobile workshops, mobile radiological units). 
8706  Chassis fitted with engines, for the motor vehicles of headings 8701 to 8705.8707  Bodies (including cabs), for the motor vehicles of headings 8701 to 8705. 
8711  Motorcycles (including mopeds) and cycles fitted with an auxiliary motor, 
 with or without side-cars;  side-cars. 2. Products to which Article 3-09 does not apply
 
 
Products under the Tariff of the General Import Tax law ( Tarifa de la Ley del Impuesto 
General de Importación , TIGI) headings 6309 (worn clothing and other worn articles) 
and 6310 (used or new rags, scrap twine, cordage, rope and cables and worn-out articles 
of twine, cordage, rope or cables, of textile materials). 
 
Used goods of the tariff codes (TIGI) listed below: 
8407.34 Of a cylinder cap acity exceeding 1,000 cc. 
8413.11  Pumps for dispensing fuel or lubricants, of the type used in filling-stations 
 or in garages. 8413.40  Concrete pumps. 
8426.12  Mobile lifting frames on tyres and straddle carriers. 
8426.19  Other. 8426.30  Portal or pedestal jib cranes. 
8426.41  On tyres. 
8426.49  Other. 8426.91  Designed for mounting on road vehicles. 
8426.99  Other. 
8427.10  Self-propelled trucks powered by an electric motor. 8427.20  Other self-propelled trucks. 
8428.40  Escalators and moving walkways. 
8428.90  Other machinery and apparatus. 8429.11  Track-laying. 
8429.19  Other. 
8429.20  Graders and levellers. 8429.30  Scrapers. 
8429.40  Tamping machines and road rollers. 
8429.51  Front-end shovel loaders. 
8429.52  Machinery with a 360° revolving superstructure. 
8429.59  Other. 8430.31  Self-propelled. 
8430.39  Other. 
8430.41  Self-propelled. 8430.49  Other. 
8430.50  Other machinery and apparatus, self-propelled. 
8430.61  Tamping or compacting machinery and apparatus. 8430.62  Scarifiers. 
8430.69  Other.  
   WT/REG218/2/Rev.1
 Page 65Costa Rica Mexico 
 8452.10  Sewing machines of the household type. 
8452.21  Automatic units. 
8452.29  Other. 8452.90  Other parts of sewing machines. 
8471.10  Analogue or hybrid automatic data processing machines. 
8471.20 Numerical or digital automatic data  processing machines, comprising in the 
 same housing at least a central processing unit and an input and output unit, 
 whether or not combined. 
8471.91  Numerical or digital processing unit, whether or not containing in the same 
 housing one or two of the following types of unit:  storage units, input units, 
 output units. 8471.92  Input or output units, whether or not containing storage units in the same 
 housing, including presented in the form of system. 
8471.93  Storage units, including presented in the form of system. 8471.99  Other. 
8474.20  Crushing or grinding machines and apparatus. 
8474.39  Other. 8474.80  Other machinery and apparatus. 
8475.10  Machines for assembling electric or  electronic lamps, tubes or valves or 
 flashbulbs, in glass envelopes. 8477.10  Injection-moulding machine. 
8701.30  Track-l aying tractors. 
8701.90 Other. 8711.10  With reciprocating internal combustion piston engine of a cylinder capacity 
 not exceeding 50 cc. 
8711.20  With reciprocating internal combustion piston engine of a cylinder capacity  exceeding 50 cc but not exceeding 250 cc. 
8711.30  With reciprocating internal combustion piston engine of a cylinder capacity 
 exceeding 250 cc but not exceeding 500 cc. 
8711.40  With reciprocating internal combustion piston engine of a cylinder capacity 
 exceeding 500 cc but not exceeding 800 cc. 8711.90  Other. 
8712.00  Bicycles and other cycles (including delivery tricycles), not motorised. 
8716.10 Trailers and semi-trailers of the caravan type, for housing or camping. 8716.31  Cisterns. 
8716.39  Other. 
8716.40  Other trailers and semi-trailers. 8716.80  Other vehicles.  
  WT/REG218/2/Rev.1 
Page 66 Costa Rica Mexico 
 Products of the tariff codes (TIGI) listed below: 
2707  Oils and other products of the di stillation of high temperature coal tar; 
 similar products in which the weight of the aromatic constituents exceeds  that of the non-aromatic constituents. 
2709  Petroleum oils and oils obtained from bituminous minerals, crude. 
2710  Petroleum oils and oils obtained from bituminous minerals, other than crude;  preparations not elsewhere specified or  included, containing by weight 70% 
 or more of petroleum oils or of oils obtained from bituminous minerals, 
 these oils being the basic constituents of the preparations;  waste oils. 
2711  Petroleum gases and other gaseous hydrocarbons. 
2712  Petroleum jelly;  paraffin wax, micro-crystalline petroleum wax, slack wax,  ozokerite, lignite wax, peat wax, other mineral waxes, and similar products 
 obtained by synthesis or by other processes, whether or not coloured. 
2713  Petroleum coke, petroleum bitumen and other residues of petroleum oils or  of oils obtained from bituminous minerals. 
2714  Bitumen and asphalt, natural;  bituminous or oil shale and tar sands; 
 asphaltites and asphaltic rocks. 2901.10  Saturated acyclic hydrocarbons. 
 
Used goods of the tariff codes listed below: 
8407.34  Reciprocating piston engines of a kind used for the propulsion of vehicles of 
 Chapter 87, of a cylinde r capacity exceeding 1,000 cc
3. 
8701.20  Road tractors for semi-trailers. 8702  Motor vehicles for the transport of ten or more persons, including the driver. 
8703  Motor cars and other motor vehicles principally designed for the transport of 
 persons (other than those of heading 8702), including station wagons and  racing cars. 
8704  Motor vehicles for the transport of goods. 
8705.20  Mobile drilling derricks. 
8705.40  Concrete-mixer lorries. 
8706  Chassis fitted with engines, for the motor vehicles of headings 8701 to  8705. 
Until 1 January 2006, used goods of the tariff positions listed above.
 
 
   WT/REG218/2/Rev.1 
 Page 67 
 
 
  ANNEX III 
 
Tariff-Rate Quotas under the Treaty  
  
1. The various schemes for the maintenance of pr eferential tariff-rate quotas between the Parties 
provided for upon the conclusion of the Treaty ar e described in Tables AIII.1 and AIII.2 below. 
Table AIII.1 
Costa Rica:  Tariff-rate quotas for products originating in Mexico 
HS Code (description) In-quota rate Out-of-quota rate Quantity 
Natural honey 
0409.00.00 Duty free 18% in 1995, progressively 
reduced to duty free in 2004 80 metric tons 
Avocados 
0804.40.00 Duty free 18.67% in 1995, progressively 
 reduced to duty free in 2009 6,000 metric tons 
Source : TEP supplied by the authorities of Costa Rica. 
Table AIII.2 
Mexico:  Tariff-rate quotas for products originating in Costa Rica 
HS Code (description) In-quota rate Out-of-quota rate Quantity 
Cane or beet sugar and chemically 
pure sucrose, in solid form 
1701.11.01, 1701.11.99, 1701.12.01, 
1701.12.99, 1701.91.01, 1701.99.01, 
1701.99.99 Duty free MFN If Mexico opens up a quota for sugar 
imports, 19% shall be allocated to 
Costa Rica;  this percentage may be 
modified in the event of the conclusion 
of preferential arrangements with other countries (see paragraph 78 above). 
Cases 
4202.11.01 Duty free 4.5% in 1995, progressively 
reduced to duty free in 2004 US$300,000 per year, with an annual 
increase of 20% 
Footwear 
6402.20.01 and 6402.99.99 Duty free 2.7% in 1995, progressively 
reduced to duty free in 2004 Joint quota of 50,000 pairs per year, 
with an annual increase of 20% 
Iron or steel plates with zinc or 
plastics 
7210.31.01 and 7210.70.01 Duty free 2.7% in 1995, progressively 
reduced to duty free in 2004 Joint quota of US$200,000 per year, 
with an annual increase of 20% 
Backed aluminium foil 
7607.20.01 Duty free 6.7% in 1995, progressively 
reduced to duty free in 2004 US$50,000 per year, with an annual 
increase of 20% 
Source : Annex to Article 3-04 and Annex 3 to Article 4-04 of the Treaty. 
Table AIII.3 
Levels of temporary flexibility for textile products exported in to Costa Rica from Mexico and into Mexico from Costa Rica 
Period In-quota rate  Limitation 
1.1.1995-31.12.1995 TEP US$5,000,000 
1.1.1996-31.12.1996 TEP  US$5,750,000  
1.1.1997-31.12.1997 TEP  US$6,612,500 
1.1.1998-31.12.1998 TEP  US$7,604,375 
1.1.1999-31.12.1999 TEP  US$8,745,031 
Source : Annex to Article 3-14 of the Treaty. 
 
__________