WORLD TRADE  
ORGANIZATION  WT/REG206/3 
10 August 2010 
 (10-4255) 
Committee on Regional Trade Agreements  
  
 
   
 
 
FACTUAL PRESENTATION 
 
Free Trade Agreement 
between 
Mexico and Nicaragua 
(Goods) 
 
Report by the Secretariat 
 
 
 
 This report, prepared for the considera tion of the Free Trade Agreement between 
Mexico and Nicaragua has been drawn up by the WTO Secretariat on its own 
responsibility and in full consultation with th e Parties.  The report has been drawn up 
in accordance with the rul es and procedures contained in the Decision for a 
Transparency Mechanism for Regiona l Trade Agreements (WT/L/671).  
 Any technical questions arising from this report may be addressed to Ms. Roberta Lascari (tel: +41 22 7396268).  WT/REG206/3 
 Page iii 
 
 
  TABLE OF CONTENTS 
 
  Page 
I. TRADE ENVIRONMENT 1  
II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 7  
A. BACKGROUND INFORMATION  7  
III. NATIONAL TREATMENT AND MARKET ACCESS FOR GOODS 8  
A. IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  8  
1. General provisions 8  
2. Liberalization of tariffs and trade 10  
(a) Liberalization by Mexico 13  
(b) Liberalization by Nicaragua 17  
3. Tariff Rates Quotas 20  
(a) Sugar 20  
(b) Textiles and clothing 21  
B. RULES OF ORIGIN  23  
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  26  
D. REGULATORY PROVISIONS ON TRADE IN GOODS  27  
1. Standards 27  
(a) Technical barriers to trade 27  
(b) Sanitary and phytosanitary measures 28  
2. Safeguard mechanisms 29  
(a) Global safeguards 29  
(b) Bilateral safeguards 30  
3. Anti-dumping and countervailing measures 31  
4. Subsidies and State-aid 31  
5. Other regulations 32  
(a) Customs-related procedures 32  
(b) Government Procurement 33  
(c) Intellectual Property Rights 34  
IV. PROVISIONS AFFECTING TRADE IN GOODS 35  
A. SECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  35  
1. Agricultural products 35  
V. GENERAL PROVISIONS OF THE AGREEMENT 36  
1. Transparency 36  
2. Current payments and capital movements 36  
3. Exceptions 36  
4. Accession and withdrawal 37  
5. Institutional framework 37  
6. Dispute settlement 38  
7. Relationship with other Agreements concluded by the Parties 39  
ANNEX I 41 
ANNEX II 47 
ANNEX III 50  WT/REG206/3 
 Page 1 
 
 
  I. TRADE ENVIRONMENT 
1. The Free Trade Treaty between Mexico and Nicaragua (hereinafter the "Treaty") is Mexico's 
first notification to the WTO of a regional trade agreement (RTA) with a Central America country 
(preceding the agreements with El Salvador, Gu atemala, Honduras and Costa Rica).  It is also 
Nicaragua's first bilateral agreement notified to  the WTO (preceding the one with Chinese Taipei).1  
2. The two economies are of considerably different size and have different trade profiles.  In 
2008, Mexico's GDP was estimated at  US$1 trillion, while that of Ni caragua was significantly smaller 
(US$6.5 billion).  In the same year, Mexico was the 16th  largest exporter and importer of goods, with 
total merchandise exports of US$291 billion, repre senting 1.81% of global e xports, and imports of 
US$318 billion, representing 1.93% of gl obal imports.  Nicaragua ranked 136th and 123rd among the 
world's exporters and importers  of goods.  Its merchandise e xports amounted to US$1.4 billion 
(0.01% of global exports), while imports amounted  to US$4.3 billion (representing 0.03% of global 
imports).  The structure of merchandise exports and imports shows that manufactures are the most 
traded commodities for Mexico, and account for more than half of Nicaragua's total imports, while 
agricultural products dominate Nicaragua's global e xports.  The Parties' overall trade to GDP ratios 
are considerably different, 58.3 for Me xico and 123.6 for Nicaragua (2006-08).2 
3. Since the entry into force of the Treaty, there h as been an increase in th e share of total trade 
between the two partners.  In 1997, just before the entry into force of the Treaty, Nicaragua was 
Mexico's 37th largest destination, with a share of 0.08% of its total exports, and 65th import source, 
with a share of 0.01%.  Mexico represented an impor tant trading partner for Nicaragua since it was its 
tenth export market (1.9% of the total) and fift h import source (5.6%).  In 2008, while Nicaragua 
continued to account for a relatively small share of  Mexico's total imports and exports (0.04% and 
0.13%, respectively), Mexico became Nicaragua's fourth largest export market, accounting for 7.4% 
of its global exports, and its fourth largest source of imports, at 8.1% of total imports.3 
4. Recent developments in global and intra-Party tr ade are presented in Charts I.1 (Mexico) and 
I.2 (Nicaragua).  Over most of the period 1995-2008,  Mexico experienced a slight but constant trade 
deficit with the world which started in 1997.  In contrast, it has a growing trade surplus with 
Nicaragua, peaking in 2007 when exports reach ed US$730 million.  During the same period, 
Nicaragua has recorded an overall deficit on its tr ade with the world, as well as with Mexico where 
imports almost doubled in value between 2005 and 2006. 
5. Data reported to the UNSD Comtrade database pr esents some discrepancies with respect to 
Mexico's exports to Nicaragua, as reported by Me xico, and Nicaragua's imports from Mexico, as 
reported by Nicaragua, in particular from 2005 to  2008.  For instance, in 2005 Mexico reported 
exports of US$324 million and Nicaragua  reported imports of US$215.7 million.4  Similar 
discrepancies concern data reported by Nicaragua with respect to its exports to Mexico and to 
Mexico's imports from Nicaragua, as reported by Mexi co.  In 2005, for instance, Nicaragua reported 
exports of US$44 million and Mexico  reported imports of US$158 million.5  The reason for the 
discrepancies in the data reported by the Parties is not clear. 
                                                      
1 WTO Regional Trade Agreements Database: http://rtais.wto.org/UI/Pu blicMaintainRTAHome.aspx  
2 WTO Statistics Database, Trade Profiles (March 2010). 
3 UNSD, Comtrade Database. 
4 In 2007, the figures correspond to US$730 and US$571 million;  in 2008, to US$372.8 and 
US$517 million. 
5 In 2007, these correspond to US$177 and US$91 million;  in 2008, to US$266.8 and US$119 million.  
Data on exports to Mexico have been submitted by Nicaragua to the WTO Secretariat. WT/REG206/3 
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  050100150200250300350
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080.00.10.20.30.40.50.60.70.80.91.0US$billion US$billionChart I.1 - Mexico: Merchandise imports from and exports to world 
and Nicaragua, 1995-2008
Source : UNSD, Comtrade database.Imports from Nicaragua
Exports to NicaraguaTotal imports
Total exportsLeft hand scale: Right hand scale:
 
0.00.51.01.52.02.53.03.54.04.55.0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080.00.10.20.30.40.50.60.70.80.91.0US$billion US$billionChart I.2 - Nicaragua: Merchandise imports from and exports to 
world and Mexico, 1995-2008
Source:  UNSD, Comtrade database  (1995-2005)  and Nicaragua authorities  (2006-2008) .Imports from Mexico
Exports to MexicoTotal imports
Total exportsLeft hand scale: Right hand scale:
4
 
 
    WT/REG206/3 
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  6. 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 (1995-97) and after ten years of implementation 
(2006-08) is shown in Charts I.3.A and I.3.B resp ectively, on the basis of Harmonized System (HS) 
sections. 
7. During 1995-97, Mexico's imports from Nicara gua were estimated at US$11 million, while 
Nicaragua's imports from Mexico were US$56 million.  Although more than half  of Mexico's imports 
from the world were made of machinery (38%), b ase metals (9.3%), and plastics (8.1%), its imports 
from Nicaragua were dominated by vegetables, which alone accounted for 68.3% of the total, 
followed by live animals (12.5%) and raw hides (9 .6%).  Nicaragua's imports from Mexico more 
closely reflected Mexico's exports to the world, with minerals and vehicles accounting for a large 
share of bilateral imports and Mexico's overall e xports.  Chemicals also accounted for 20.8% of 
Nicaragua's imports from Mexico. WT/REG206/3 
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  Chart I.3.A
Mexico and Nicaragua: product compos ition of merchandise trade, annual 
average (1995-1997)
Mexico's imports from Nicaragua Nicaragua's imports from Mexico
 Source:   UNSD, Comtrade database.Per cent
Total:  US$11 million Total:  US$56 million
Total:  US$91.3 billion Total: US$1.2 billion
Total:  US$95.1 billion Total:  US$0.6 billionMexico's global exportsNicaragua's global exportsMexico's global imports Nicaragua's global importsOther
2.3
Vegetables  
68.3Minerals
27.9Other 
5.4
Wood pulp 5.3
Base metals 7.8
Other 
11.6
Minerals
13.4Machinery 
16.6
Plastics 6.7Other
6.3
Minerals 11.4Vegetables 3.6Machinery
36.8Optical 2.9
Miscellaneous 3.0
Textiles 6.3Vehicles 9.0
Plastics 2.5Vegetables 6.5
Other 
5.7Other 
6.9Base metals
 9.3Chemicals 6.9
Plastics 
8.1Vehicles 7.6
Articles of wood 2.8
Precious stones 5.3Animals
12.5
Chemicals 
16.7 Textiles 2.6Machinery 5.3
Base metals 6.2 Plastics
7.9
Vehicles 
9.6Vegetables 2.0
Wood pulp 3.6Machinery 
38.0
Textiles 5.7Vegetables 3.5
Optical 5.7Raw hides 9.6
Minerals 2.8
Base metals 7.3Prepared foods 5.1Wood pulp 3.6Fats and oils 3.6Optical 2.4
Vehicles  
16.7Chemicals 3.6Optical 2.3Prepared foods 2.0
Vegetables
30.6
Animals
 23.3Prepared foods 
12.7Prepared foods 7.2
Chemicals
20.8Prepared foodss
8.0
Machinery
6.7Miscellaneous 6.0
  WT/REG206/3 
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  8. After ten years of implementation of the Treaty,  Mexico's global imports  have substantially 
increased (from US$91.3 billion to US$282 billion), while its imports from Nicaragua reached US$96 million.  Nicaragua's overall export structure remains largely unchanged, with vegetables and 
animals still accounting for almost half of its expo rts (49.3%) and textiles for 12.8%.  Similarly, 
vegetable products still represent the largest share of Mexico's imports from Nicaragua, although with 
a significantly reduced share (down to 35.9%), fo llowed by live animals (19.5%), and machinery 
(19.2%).  The value of Nicaragua's imports fro m Mexico has also increased significantly (from 
US$56 million to US$527 million).  Minerals are now Nicaragua's main imports from Mexico 
(38.6%);  while the share of chemicals remains si gnificant (11.3%), the share of machinery imports 
has increased substantially from 5.3% to 19.2%.   
9. The change in structure, in particular, the par tial displacement of Mexico's vegetable imports 
from Nicaragua by machinery, may in part be explai ned by the structure of tariff liberalization under 
the Treaty.  For instance, Annex Tables AI.3.A a nd B show that of Nicaragua's top 25 exports to 
Mexico roasted coffee, which accounted for almost  20% of its exports over the period 1995-2007, was 
not liberalized and faced tariffs of 20%.  In contr ast, liberalization of non-agricultural products may 
have allowed Nicaraguan exporters to expand their exports of machinery.  WT/REG206/3 
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  Chart I.3.B
Mexico and Nicaragua: product compos ition of merchandise trade, annual 
average (2006-2008)
Mexico's imports from Nicaragua Nicaragua's imports from Mexico
 Source:   UNSD, Comtrade database.Per cent
Total:  US$96 million Total:  US$527 million
Total:  US$282 billion Total: US$3.7 billion
Total:  US$271 billion Total:  US$1.5 billionMexico's global exportsNicaragua's global exportsMexico's global imports Nicaragua's global importsOther
3.3
Vegetables  
35.9
Machinery 
19.2Minerals
38.6Other 
4.6
Plastics 3.5
Other 
7.8
Machinery
14.1Chemicals 
14.1Plastics 4.2Other
12.8
Vehicles 16.0Miscellaneous 2.9Machinery
37.8Vegetables 2.8
Textiles 2.8
Base metals 5.5Prepared foods 
6.6
Plastics 2.4Vegetables 4.5
Other 
4.8Other 
12.7Vehicles
 9.7Chemicals 7.5
Base metals 
8.9Minerals 8.1
Base metals 2.1
Machinery 3.7Fats and oils
7.1
Minerals 
22.2Textiles 1.8Prepared foods 
5.4
Optical 3.4 Chemicals
11.3Prepared foods 5.0
Machinery 
19.2Vehicles 3.0
Optical 4.3Machinery 
36.5
Plastics 7.1Textiles 3.1
Precious stones 
4.6Textiles 6.8
Wood pulp 2.3
Base metals 6.3Wood pulp 3.1Fats and oils 2.2Miscellaneous 1.9
Minerals  
16.8Chemicals 2.9Vegetables 2.4Prepared foods 2.4
Vegetables
25.3
Live animals
 24.0Prepared foods 
12.8Raw hides 3.1Wood pulp 2.6
Live animals
19.5
Miscellaneous 2.0Base metals 
11.8
Vehicles 6.3
Textiles 
12.8Chemicals 1.9
  WT/REG206/3 
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  II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
A. BACKGROUND INFORMATION  
10. The Free Trade Treaty between Mexico and Nicaragua is one of the bilateral agreements 
concluded by Mexico with each of the members of the Central American Common Market (CACM), comprising also El Salvador, Guatemala, Hondur as and Costa Rica, to promote regional economic 
integration.   
11. The Treaty was signed on 18 December 1997 and entered into force on 1 July 1998.  It was 
notified to the WTO on 17 October 2005 under Ar ticle XXIV:7(a) of the GATT 1994 and the 
Understanding on the Interpretation of Article XXIV of the GATT 1994 
(document WT/REG206/N/1) and under Article V:7 of the GATS (document S/C/N/359).   
12. The Treaty comprises 22 Chapters and various a nnexes – either within the respective chapter 
or at the end of the Treaty - all of which are an inte gral part of it.  Box II.1 provides an outline of the 
Treaty together with its most relevant annexes. 
Box II.1 
Outline of the Mexico-Nicaragua Free Trade Treaty 
 
Preamble  
Part I: General Aspects  
Chapter I Initial Provisions 
Chapter II General Definitions 
Part II: Trade in Goods  
Chapter III  National Treatment  and Market Access for Goods 
     Annex to Articles 3-03 and 3-09: Exceptions to Articles 3-03 and 3-09 
     Annex to Article 3-04: Tariff Reduction Programme – Sections A (Mexico) and B (Nicaragua) 
Chapter IV Agricu ltural Sector  
     Annex 1 to Article 4-04: Exclusions from liberalization 
     Annex 2 to Article 4-04: Trade in Sugar 
Chapter V Sanitary and Phytosanitary Measures 
Chapter VI Rules of Origin  
     Annex to Article 6-03: Specific Rules of Origin 
Chapter VII Customs Procedures Chapter VIII Safe guard Measures 
Chapter IX Unfair Intern ational Trade Practices 
Part III: Trade in Services  
Chapter X General Principles on Trade in Services 
   Annex to Article 10-1 3: Professional Services 
Chapter XI Telecommunications 
Chapter XII Temporary Entry for Business Persons 
Chapter XIII Financial Services 
Part IV: Technical Barriers to Trade 
Chapter XIV Standard-related Measures 
Part V: Government Procurement  
Chapter XV: Government Procurement 
      Annexes to Article 15-02, including list of entities, goods, services, and financial services 
 WT/REG206/3 
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  Part VI: Investment 
Chapter XVI Investment 
Part VII: Intellectual Property 
Chapter XVII Intellectual Property 
Part VIII: Administ rative Provisions 
Chapter XVIII Transparency 
Chapter XIX  Administration of the Treaty 
Part IX: Dispute Settlement  
Chapter XX Dispute Settlement 
Part X: Other Provisions 
Chapter XXI Exceptions 
Chapter XXII Final Provisions  
 
Source:  Free Trade Treaty between Mexico and Nicaragua. 
 
13. While the Treaty does not prov ide a specific time-limit for implementation, the goods 
liberalization programme is to be completed over a transition period of 15 years (1998-2012). 
14. Article 22-07 foresees a periodic evaluation of the development of the Treaty with a view to 
improving it, consolidating the integration process in  the region, and encourag ing active participation 
from productive sectors.6 
III. NATIONAL TREATMENT AND MARKET ACCESS FOR GOODS 
A. IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
1. General provisions 
15. National treatment is granted to goods of the other Party in accordance with Article III of 
GATT 1994, and its interpretative notes, which are inco rporated into the Treaty (Article 3-03).  With 
respect to a state or municipality, national treatme nt means treatment no less favourable than that 
accorded to any similar or directly competitive or  substitutable products of the Party of which the 
state or municipality forms part.  National treatment does not apply to products  listed in the Annex to 
Articles 3-03 and 3-09.7 
16.  Article 3-04.1 prohibits the Parties from increasing any existing, or adopting any new 
customs duties on originating goods, unless otherwis e provided.  However, footnotes 1 and 2 permit 
an increase in the customs duty to a level not great er than that established under the Tariff Reduction 
Programme (TRP) if that customs duty was previously  and unilaterally reduced to a level below that 
indicated in the TRP.  The Parties are also pe rmitted to increase customs duties pursuant to any 
provisions resulting from a WTO dispute settlement procedure between them.   
17. Article 3-05 prohibits duty-drawback and duty deferral in the following cases: 
(a) goods imported into a Party's territory by an amount that exceeds the total duty paid 
or owed on the quantity of the imported good, provided that the good is used either as an input or replaced by identical or similar inputs in the production of originating 
goods that are subsequently re-exporte d to the other Party (Paragraph 2); 
 
                                                     
 
6 The Treaty does not contain a definition of "productive sectors".  The Parties understanding is that 
this means the economic s ectors of a country, such as industry , agriculture, trade, services etc. 
7 A full list of these exceptions is provided in Annex II to this presentation.  WT/REG206/3 
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  (b) in case of re-export, on (i) countervailing duties pursuant to a Party's domestic law;  
(ii) a premium offered or collected on an  imported good arising out of any tendering 
system for the administration of quantitative import restrictions, TRQs, or tariff preferences;  or (iii) duties paid or ow ed on a good imported and substituted by an 
identical or similar good that is sub sequently exported to the other Party 
(Paragraph 3);  and 
(c) as from 1.7.2005, on imported goods, used either as inputs or replaced by identical or 
similar inputs, in the production of origin ating goods subsequent ly re-exported to the 
other Party (Paragraph 4).  In these cases,  the exporting Party shall assess the customs 
duties as if the exported good was destined for domestic consumption and, within 60 
days from the date of export, collect th e duties as if the exported good had been 
destined for domestic consumption (Paragraph 5).  Paragraphs 4 and 5  shall apply (i) 
from the time when Nicaragua applies such prohibitions to a non-party; or (ii) with 
respect to imported goods and for a three-year period, if it can be demonstrated that the refund, waiver, or reduction of customs duties cause simultaneously a "significant 
distortion" to the tariff treatment applied by the Party applying the refund, waiver, or 
reduction of customs duties, and a "damage" to the other Party's production
8 of an 
identical, similar or directly competitive product (Paragraph 6).9 
18. Duty-drawback and duty deferral is permitted for:   (i) goods that entered under bond or 
guarantees for transportation and export to the other Part y's territory;  (ii) goods that are re-exported in 
the same conditions as when imported;  (iii) importe d goods, used either as inputs or substituted by 
identical or similar inputs, in the production of originating goods deemed to be re-exported to the 
other Party, by reason of their delivery to a duty-fr ee shop or for ships stores or supplies for ships or 
aircrafts;  (iv) refunds of customs duties by a Pa rty on a particular re-exported good, where that refund 
is granted 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;  or (v) an originating good that is 
imported into the territory of a Party and subsequently  exported to the territory of the other Party, or 
used as a material in the production of another good th at is subsequently exported to the territory of 
the other Party, or is substituted by an identical or  similar good used as a material in the production of 
another good that is subsequently exported to the territory of the other Party (Paragraph 9).  
19. The Treaty allows duty-free temporary admission for the following goods (Article 3-06):  
professional equipment necessary for business activities;   equipment for the press, sound or television 
broadcasting, and cinematographic equipment;  go ods imported for sports purposes;  goods intended 
for display or demonstration;  commercial samples and advertising films.  Duty-free entry is also granted to commercial samples of no commercial valu e imported from the other Party (Article 3-07).  
20. Article 3-08 prohibits any new waiver of custom s duties whenever it is conditioned, explicitly 
or implicitly, on the fulfilment of a performance require ment.  Any such measure in force at the entry 
into force of the Treaty was eliminated by 1.7.2007.
10  In cases where the waiving of customs duties 
has an adverse impact on the other Party's economy, on the commercial interests of a person or of a 
company owned or controlled 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. 
21. Import restrictions or prohibitions, other than  those authorized under Article XI of the 
GATT 1994 (which is incorporated into the Treaty), are forbidden (Article 3-09.1).  This prohibition 
                                                      
8 The criteria for defining "significant distortion" and "damage" are outlined in Paragraphs 7 and 8 of 
Article 3-05. 
9 Nicaragua informed the Secretariat that, as at June  2010, it has not applied any of these restrictions. 
10 Nicaragua informed the Secretariat th at it does not apply such measures. WT/REG206/3 
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  includes import price requirements, except as pe rmitted in the enforcement of countervailing 
measures (Article 3-09.2).
11  Article 3-09.3 does not prevent a Party that has adopted or maintains 
restrictions or prohibitions on g oods imported from a non-party, from  limiting or prohibiting imports 
of goods of that non-party from the other Party, or  requiring as a condition for the export of such 
goods to the other Party that the goods are being cons umed in the territory of the other Party before 
being re-exported, directly on indirectly, to the non-party.  
22. Quantitative restrictions on imports and exports  are permitted for the following goods:  for 
Mexico, machinery and mechanical appliances, fuels and oil, and some categories of vehicles;  and 
for Nicaragua, rubber, machinery and electrical machin ery, some categories of vehicles, fuels and oil, 
and wood products (Annex to Artic le 3-03 and to Article 3-09).12 
2. Liberalization of tariffs and trade 
23. The TRP is set out in Annex 3-04;  tariff lib eralization is to be completed over 15 years 
(i.e. by 2012).  The Parties may consult each  other on the possibility of accelerating the 
TRP (Article 3-04.2 and 3).13  The tariff reduction programme is based on product categories and is to 
be implemented in annual equal inst alments on 1 July of each year.  The base rates of customs duty to 
which subsequent tariff reductions apply are indicat ed by the Parties in their respective tariff 
schedules. 
24. Products in category A were liberalized by both Parties upon entry into force of the Treaty 
(on 1.7.1998).14  For products in categories B, C, and C15, the Parties shall follow a different phase-
out period for liberalization (see Box III.1). 
25. With respect to goods in category DES NIC (see Table III.1), Nicaragua shall eliminate tariffs 
on the date when Mexico completes its duty eliminat ion in accordance with the TRP.  The tariff rate 
to be applied by Nicaragua to this category duri ng the transition period shall be the lesser between 
Nicaragua's MFN rate and Mexico's preferen tial rate applied to the same product.   
Table III.1 
Products listed under "DES NIC" category  
PRODUCT  
(by HS chapter)  HS CODE  
(10-digit level) 
Meat and edible offal of poultry 0207.11.00.00; 0207.12.00.00; 0207.13.91.00; 0207.13.99.10; 
0207.13.99.20; 0207.13.99.90; 0207.14.91.00; 0207.14.99.10; 
0207.14.99.20; 0207.14.99.90;  0207.26.90.00;  0207.35.00.00. 
Cheese and curd 0406.10.00.00; 0406.20.90.10; 0406.20.90.90; 0406.30.00.00; 
0406.40.00.00; 0406.90.00.10; 0406.90.00.90. 
Birds' eggs 0407.00.20.00;    0407.00.90.00. 
Potatoes, other 0701.90.00.00. 
Leguminous vegetables 0713.33.10.00;    0713.33.20.00;   0713.33.90.00. 
Corn (maize) 1005.90.10.00; 1005.90.20.00; 1005.90.30.00; 1005.90.90.00. 
Pig and poultry fat 1501.00.00.00. 
Animal or vegetable fats and oils 1516.10.00.10; 1516.10.00.90. 
Extracts, essences, concentrates of coffee 2101.11.00.00. 
Beverages, spirits and vinegar 2201.10.00.90;  2201.10.00.90; 2202.10.00.12; 2202.10.00.19; 
2202.90.10.00; 2202.90.90.10; 2202.90.90.90; 2203.00.00.10; 2203.00.00.90; 2207.10.10.00; 2207.10.90.10; 2207.10.90.90; 
2207.20.00.10; 2207.20.00.90; 2208.20.00.00; 2208.30.00.00; 
2208.40.90.10; 2208.40.90.90; 2208.50.00.00; 2208.60.00.00; 2208.70.00.00; 2208.90.10.00;    2208.90.20.00;    2208.90.90.00 
                                                      
11 Nicaragua indicated that it does not apply import restrictions or prohibitions against Mexico. 
12 The exhaustive list of goods subject to restrictions is shown in Annex II to this presentation. 
Nicaragua indicated that, as at June 2010, the measures listed in the Annex are still in force. 
13 As indicated by the Parties, as at June 20 10, no changes to the TRP have been agreed. 
14 Nicaragua confirmed that goods in category A were  liberalized at the entr y force of the Treaty.  WT/REG206/3 
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  PRODUCT  
(by HS chapter)  HS CODE  
(10-digit level) 
Tobacco and tobacco substitutes 2401.10.10.00;  2401.10.20.00; 2401. 10.90.00; 2401.20.10.00; 
2401.20.20.00; 2401.20.90.00; 2401.30.10.00; 2401.30.20.00; 
2401.30.90.00; 2402.10.00.00; 2402.20.00.00; 2402.90.00.00; 
2403.10.10.00;    2403.10.90.00;   2403.99.00.00 
 
Source: Data provided by the Parties. 
 
26. Most of Nicaragua's tariff lines were subject to  the customs duty appearing in the "temporary 
protective tariff" (TPT) column, marked as "ATP" in  its tariff schedule.  The TPT was eliminated on 
1.1.1999, except for 33 lines relating to beverages an d spirits, tobacco and manufactured substitutes, 
and matches (except for pyrotechnic products).15  The TPT ranged from 20% to 35% and was 
reduced, until its complete eliminati on, during the period 1.7.1998 - 1.7.2001.16  
27. Goods included in category TA are subject to  tariff rate quotas (TRQs) by Mexico, provided 
that the TRQs do not have restrictive effects on imports additional to those resulting from their own 
imposition (Article 3-04.5) (See Section on TRQs).  
28. Goods marked as "EXCL" in the Parties' sche dules are excluded from tariff elimination under 
the Treaty (see Annex III to this presentation).  
Box III.1:  Categories of the TRP   
A Elimination of tariffs by the Parties as from entry into force of  the Treaty (1.7.98) 
B Elimination of tariffs by Mexico in 5 instalments, starting from 1998;  duty-free on 1.7.02 
Elimination of tariffs by Nicaragua in 3 instalments, starting from 2000;  duty-free on 1.7.02 
C Elimination of tariffs by Mexico in 10 instalments, starting from 1998;  duty-free on 1.7.07 
Elimination of tariffs by Nicaragua in 8 instalments, starting from 2000;  duty-free on 1.7.07 
C15 Elimination of tariffs by Mexico in 15 instalments, starting from 1998;  duty-free on 1.7.12 
Elimination of tariffs by Nicaragua in 13 instalments, starting from 2000;  duty-free on 1.7.12 
ATP Elimination of tariffs by Nicaragua in 6 instalments, starting from 1998; duty free on 1.7.01 
DES NIC Nicaragua shall apply the lower of its MFN applied rate or the tariff applied by Mexico on the 
same product 
TA TRQs on sugar applied by Mexico  
EXCL Products excluded from the Treaty 
 
Source : Annex 3-04 of the Treaty. 
 
29. The overall tariff elimination under the Treaty, in terms of number of lines and value of trade, 
is shown in Tables III.2.A (Mexico) and III.2.B (Ni caragua).  Mexico's MFN tariff schedule in the 
year of entry into force of the Treaty (1998) compri sed 11,213 tariff lines at the HS 8-digit level, of 
which 72 held non- ad valorem  duties (0.6% of the total).17  In 1997, 1,579 tariff lines, corresponding 
to 14.1% of the total, were already duty-free on an  MFN basis.  This figure corresponded to 73.8% of 
Mexico's total imports from Nicaragua before the entry into force of the Treaty (1995-97) and to 
                                                      
15 These lines, at HS 10-digit level, are:  beverages and spirits (HS 2201.10.00.90, 2202.10.00.11, 
2202.10.00.12, 2202.10.00.19, 2202 .90.10.00, 2202.90.90.10, 2202.90.90. 90, 2203.00.00.10, 2203.00.00.90, 
2207.10.10.00, 2207.10.90.10, 2207 .10.90.90, 2207.20.00.10, 2207.20.00. 90, 2208.20.00.00, 2208.30.00.00, 
2208.40.10.00, 2208.40.90.10, 2208 .40.90.90, 2208.50.00.00, 2208.60.00. 00, 2208.70.00.00, 2208.90.10.00, 
2208.90.20.00, 2208.90.90.00);  tobacco and ma nufactured tobacco substitutes (HS 2402.10.00.00, 
2402.20.00.00, 2402.90.00.00, 2403 .10.10.00, 2403.10.90.00, 2403.91.00. 00, 2403.99.00.00), and matches, 
except pyrotechnic products (HS 3605.00.00.00). 
16 Nicaragua indicated that it has not applied the AT P tariff since 2001, pursuant to Decree No. 51 of 
2001. 
17 Of these, 10 are subject to specific duties, 45 to compound duties, and 17 are prohibited lines. WT/REG206/3 
Page 12  
 
  47.4% of imports in 2003-05.  Upon entry into fo rce, an additional 6,602 tariff lines (58.9% of the 
total) became duty-free, corresponding to 10.4% of  imports from Nicaragua in 1995-97 and to 8.1% 
in 2003-05.  The bulk of liberalization occurred in th e first ten years of implementation:  in 2007, an 
additional 26.4% of Mexico's tariff lines were libera lized, representing nearly half of Mexico's total 
imports from Nicaragua (44.6%).  At the end of the implementation period (2012), 28 lines will 
remain dutiable;  as a result, 99.8% of Mexico's tariffs shall be duty-free, corresponding to 100% of 
trade between the Parties.   
Table III.2 
Tariff elimination commitments under the Treaty and corresponding average trade 
A. Mexico 
Duty phase-out 
period Number 
of lines % of 
total 
lines in 
Mexico's 
tariff 
schedule Value of Mexico's 
imports from 
Nicaragua 
(1995-1997) 
in million US$ % of Mexico's 
total imports 
from 
Nicaragua  
1995-1997 Value of 
Mexico's 
imports from 
Nicaragua 
(2003-2005) 
in million US$ % of Mexico's 
total imports 
from Nicaragua  
2003-2005 
MFN duty free 
(1997) a 1,579 14.1 7.9 73.8 22.3 47.4 
1998 6,602 58.9 1.1 10.4 3.8 8.1 
2002 1,548 13.8 0.1 1.2 1.4 3.1 
2007 1,413 12.6 0.4 3.8 19.5 41.5 
2012 43 0.4 1.2 10.8 0.0 0.0 
Remain dutiable 28 0.2 0.0 0.0 0.0 0.0 
Total 11,213 100.0 10.6 100.0 47.0 100.0 
 
a MFN rate at 18 December 1997.  
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 1996 nomenclature. 
 
Source :  WTO estimates based on data provided by Mexico. 
 
30. In 1998, Nicaragua's MFN tariff schedule comprised 6,228 tariff lines at the HS 10-digit 
level.  Of these, 2,854 were already duty-free on an  MFN basis before the entry into force of the 
Treaty, corresponding to 45.8% of the total.  This  figure corresponded to 56.1% of Nicaragua's total 
imports from Mexico before the entry into force of the Treaty (1995-97) and to 57.4% in 2003-05.  
Upon entry into force, an additional 758 tariff lines (12.2% of the total) became duty-free, 
corresponding to 4.6% of bilateral imports in 1995-97 and to 2.8% in 2003-05.  The bulk of 
liberalization occurred in the first ten years of im plementation:  in 2007, an additional 40.8% of 
Nicaragua's tariff lines were libera lized, accounting for 37.4% its tota l imports from Mexico.  In 2012, 
28 lines will remain dutiable under the Treaty;  as a result, 99.6% of Nicaragua's tariffs shall be 
duty-free, corresponding to 99.8% of trade between the Parties.    WT/REG206/3 
 Page 13 
 
 
  Table III.2 
Tariff elimination commitments under the Treaty and corresponding average trade 
B. Nicaragua 
Duty phase-out 
period Number 
of lines % of total 
lines in 
Nicaragua's 
tariff 
schedule Value of Nicaragua's 
imports from Mexico  
(1995-1997) 
in million US$ % of 
Nicaragua's 
total imports 
from Mexico  
1995-1997 Value of 
Nicaragua's 
imports from 
Mexico 
(2003-2005) 
in million US$ % of 
Nicaragua's 
total imports 
from Mexico  
2003-2005 
MFN duty free 
(1998) 2,854 45.8 29.3 56.1 102.4 57.4 
1998 758 12.2 2.4 4.6 5.0 2.8 
2000 2 0.0 1.9 3.6 0.1 0.1 
2002 1,458 23.4 8.5 16.2 44.0 24.7 
2007 1,084 17.4 9.2 17.6 24.3 13.6 
2012 44 0.7 0.8 1.5 2.3 1.3 
Remain dutiable 28 0.4 0.2 0.4 0.3 0.2 
Total 6,228 100.0 52.3 100.0 178.4 100.0 
 
Note: excludes data beyond HS Chapter 97.  
 Based on the HS 1996 nomenclature. 
 
Source :  WTO estimates based on data provided by Nicaragua. 
 
(a) Liberalization by Mexico 
31. A more detailed perspective of Mexico's tariff elimination is presented in Chart III.1.  In 
1998, when the Treaty entered into force, 14.1% of  Mexico's tariffs were already duty-free on an 
MFN basis.  Of the 6,602 tariff lines that were lib eralized upon entry into force, nearly all (6,564) 
held base rates of up to 20%.  After five years of  implementation (2002), the bulk of liberalization still 
concerned duties of 20% or less.  In 2007, at the en d of the tenth year, 480 lines with duties equal to 
or below 40% were liberalized.  By the end of  the transitional period, 11,185 lines are to be 
liberalized, including 16 lines with duties equal to or below 50% and 46 lines with duties above 50%. WT/REG206/3 
Page 14  
 
  0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,0001998200220072012Chart III.1
Mexico's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Mexico.Number of duty-free lines (cumulative)
≤10% ≤20% ≤30% MFN is: ≤40% ≤50% >50%
 
 
32. Table III.3 shows Mexico's liberalization commitments under the Treaty organized by 
HS section products categories.  Of the 11,213 lines forming Mexico's tariff schedule, 1,579 were already duty-free on an MFN basis in the year befo re the enactment of the Treaty, covering mostly 
chemicals and chemical products (HS section VI) and machinery (HS section XVI), which together 
accounted for more than two-third of all duty-free lines.  Upon entry into force of the Treaty, 
6,602 lines were liberalized;  of these, more than ha lf also consisted of chemicals and related products 
and machinery.  At the end of the tenth year ( 2007), an additional 2,961 lines were liberalized, of 
which 717 covered textiles pr oducts (HS section XI).  In 2012, 43 lines are to be liberalized, of which 
half are machinery and chemical products.  Under th e Treaty, 28 lines remain dutiable:  most of them 
are included in HS section IV (prepared foodstuffs),  while 4 are prohibited lines (HS sections I and 
II).  The average final tariff on dutiable products is 70.3%. 
Table III.3 
Mexico: Tariff elimination under the Treaty, by HS section 
Number of duty-free lines  HS section  MFN 
avg.%  Total No 
of lines  MFN 
1997 a 1998 2002 2007 2012 Remain 
dutiable  Avg. Final 
Tariff 
(Dutiable)  
I Live animals and animal 
products 32.8 277 19 103 54 96 4 1 - 
II Vegetable products 15.2 411 78 148 102 72 1 10 49.7 b 
III Animal or vegetable 
fats and oils 21.1 66 1 3 13 49    
IV Prepared foods etc. 19.9 308 5 25 99 162  17 90.9 c 
V Minerals 8.8 190 28 101 37 22 2   
VI Chemicals and 
chemical products 8.6 2,647 689 1,795 122 30 11   
Table III.3 (Cont'd)   WT/REG206/3 
 Page 15 
 
 
  Number of duty-free lines  HS section  MFN 
avg.%  Total No 
of lines  MFN 
1997 a 1998 2002 2007 2012 Remain 
dutiable  Avg. Final 
Tariff 
(Dutiable)  
VII Plastics and rubber 12.9 510 31 329 34 116    
VIII Hides and skins 15.6 89 8 35 4 42    
IX Wood and articles 15.9 124  56 29 39    
X Pulp, paper etc. 9.6 292 31 195 44 22    
XI Textiles and textiles 
articles 21.2 1,203 20 466 247 470    
XII Footwear, headgear 28.9 97  13 16 68    
XIII Articles of stone 15.1 291 3 224 48 15 1   
XIV Precious stones, etc. 8.7 62 23 19 8 12    
XV Base metals and base 
metals products 12.8 1,143 52 797 247 47    
XVI Machinery 11.3 2,437 495 1,649 225 54 14   
XVII Transport equipment 13.9 350 17 224 83 16 10   
XVIII Precision equipment 11.4 456 64 334 57 1    
XIX Arms and ammunition 16.0 29 2 2 25     
XX Misc. manufactured 
articles 17.4 219 1 84 54 80    
XXI Works of art, etc. 0.0 12 12       
Total 13.3 11,213 1,579 6,602 1,548 1,413 43 28 70.3 
 
- Prohibited tariff line. 
a  MFN rate at 18 December 1997.  b  Average rate is based on ad valorem  duty (excludes tariff lines which are prohibited). 
c  Combination of ad valorem  and specific duties. 
 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 1996 nomenclature. 
 
Source:  WTO estimates based on data provided by Mexico. 
 
33. Chart III.2 shows a comparison of average du tiable rates in those HS sections where 
preferential duties remain.  The comparison is made between Mexico's average preferential and MFN rates for lines which remain subject to preferen tial duties only.  As can be seen from the Chart, 
for HS section II (vegetable products) preferen tial duties are identical to MFN duties (49.7%) 
indicating that no tariff reduction has taken place,  while for HS section IV (prepared foodstuffs, 
beverages and tobacco) preferential duties are six times higher than MFN duties (90.5% compared to 
15%).  WT/REG206/3 
Page 16  
 
  0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0XXIXXXIXXVIIIXVIIXVIXVXIVXIIIXIIXIXIXVIIIVIIVIVIVIIIIII*Chart III.2
Mexico:  Average of dutiable rates, by HS Section
HS Section  
* HS section I contains one tariff line which is prohibited.
Source :  WTO Secretariat estimates, based on data provided by Mexico.Average rate of duty (%)
MFN Preferential
 
34. Chart III.3 shows a comparison of average du tiable rates in those HS chapters where 
preferential duties remain after the entry into force of the Treaty.  The comparison is made between 
Mexico's average preferential and MFN rates for li nes which remain subject to preferential duties 
only.  The Chart shows that no liberalization occurred for products of HS chapters 8 (edible fruits and 
nuts) and 9 (coffee, tea, mate, and spices), since preferential duties under the Treaty are identical to 
the corresponding MFN duties.  On products in HS  chapter 17 (sugar and sugar confectionery), 
Mexico maintains a very high tariff of 90.9% compared to an MFN rate of 15%.  WT/REG206/3 
 Page 17 
 
 
  0 50 100 150 20021*18*1713*12*090803*Chart III.3
Mexico:  Average of dutiable rates, by HS Chapter
HS Chapter  
* HS chapters 3, 12 & 13 contains tariff lines which are prohibited; Preferential rate in HS chapters 18 & 21 contain specific duty.
Source : WTO Secretariat estimates, based on data provided by Mexico.Average rate of duty (%)
MFN Preferential
 
(b) Liberalization by Nicaragua  
35. A more detailed perspective of Nicaragua's tari ff elimination is presented in Chart III.4.  In 
1998, before the Treaty's entry into force, 45.8% of Nicaragua's tariffs were duty-free on an MFN 
basis.  Of the 758 tariff lines that were liberalized upon entry into force, the vast majority held base 
rates of up to 10%;  the rest held duties equal or  below 20%.  After five years of implementation 
(2002), the bulk of liberalization concerned duties e qual or below 10% and 20%.  In 2007, at the end 
of the tenth year, 12 lines with duties of 30% or less and 12 lines with duties above 50% were also 
liberalized.  By the end of the transition period, 6,200 lines will become duty-free, including 13 lines with duties equal to or below 30% and 12 lines with duties above 50%. WT/REG206/3 
Page 18  
 
  0 1,000 2,000 3,000 4,000 5,000 6,000 7,00019982000200220072012Chart III.4
Nicaragua's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Nicaragua.Number of duty-free lines (cumulative)
≤10% ≤20% ≤30% MFN is: >50% duty-free
 
36. Table III.4 shows Nicaragua's liberalizati on commitments under the Treaty organized by 
HS section products categories.  Of the 6,228 lines forming Nicaragua's tariff schedule, 2,854 were 
already duty-free on an MFN basis before the enact ment of the Treaty;  half of them fell in 
HS sections VI (chemicals and chemical products) and HS section XVI (machinery).  Upon entry into force of the Treaty, 758 lines were liberalized.  These mainly covered textiles (HS section XI), 
vegetable products (HS section II), and live animal s and animal products (HS section I).  After ten 
years, further 2,544 lines were liberalized; of these , one third was still made of textile articles,  
followed by prepared foodstuff (HS section IV), a nd base metals (HS section XV).  At the end of the 
implementation period, an additional 44 lines are to be  liberalized, of which half consist of transport 
equipment (HS section XVII).  Under the Treaty , 28 lines remain dutiable divided between HS 
sections II (vegetable products) and IV (prepared fo ods).  The average final tariff on dutiable products 
is 18.8%, with the highest rate applied to prepared foodstuff (27.5%). 
Table III.4 
Nicaragua: Tariff elimination un der the Treaty, by HS section 
Number of duty-free lines  
HS section  MFN 
avg.
% Total 
No of 
lines  MFN 
1998  1998 2000 2002 2007 2012 Remain 
dutiable  Avg. Final 
Tariff 
(Dutiable)  
I Live animals and animal 
products 14.0 270 31 94  59 82 4   
II Vegetable products 10.8 380 75 124  116 48 3 14 10.0 
III Animal or vegetable 
fats and oils 9.6 73 7 2  6 58    
IV Prepared foods etc. 11.4 301 24 6  128 129  14 27.5  
V Minerals 4.7 173 85 10 1 42 33 2   
VI Chemicals and 
chemical products 2.2 943 737 11  144 44 7   
VII Plastics and rubber 4.7 312 127 37  54 94    
VIII Hides and skins 8.8 84 22 15  8 39    
Table III.4 (Cont'd)   WT/REG206/3 
 Page 19 
 
 
  Number of duty-free lines  
HS section  MFN 
avg.
% Total 
No of 
lines  MFN 
1998  1998 2000 2002 2007 2012 Remain 
dutiable  Avg. Final 
Tariff 
(Dutiable)  
IX Wood and articles 7.9 89 26   40 23    
X Pulp, paper etc. 4.3 214 131 12 1 49 21    
XI Textiles and textiles 
articles 11.9 885 104 242  209 330    
XII Footwear, headgear 13.4 62 2 5  18 37    
XIII Articles of stone 6.5 158 70 9  65 13 1   
XIV Precious stones, etc. 7.7 53 14 10  19 10    
XV Base metals and base 
metals products 3.3 679 442 30  164 43    
XVI Machinery 2.7 913 698 46  149 16 4   
XVII Transport equipment 5.8 197 64 23  72 15 23   
XVIII Precision equipment 3.9 253 159 40  53 1    
XIX Arms and ammunition 13.8 17  2  15     
XX Misc. manufactured 
articles 9.9 165 36 33  48 48    
XXI Works of art, etc. 5.0 7  7       
Total 6.5 6,228 2,854 758 2 1,458 1,084 44 28 18.8 
 
Note: Excludes data beyond HS Chapter 97.  
Based on the HS 1996 nomenclature. 
 
Source:  WTO estimates based on da ta provided by Nicaragua. 
 
37. Chart III.5 shows a comparison of average du tiable rates in those HS sections where 
preferential duties remain at the end of the implem entation period.  The comparison is made between 
the average preferential and MFN rates for lines subject  to preferential duties only.  For HS sections II 
(vegetable products) and IV (prepared foodstuff), preferential duties are slightly lower than MFN 
duties.  These correspond to 10% in HS section II, co mpared to an MFN rate of 14.6%, and to 27.5% 
in HS section IV, compared to an MFN rate of 29.3%.  
0 5 10 15 20 25 30 35XXIXXXIXXVIIIXVIIXVIXVXIVXIIIXIIXIXIXVIIIVIIVIVIVIIIIIIChart III.5
Nicaragua:  Average of dutiable rates, by HS Section
HS Section  
Source :  WTO Secretariat estimates, based on data provided by Nicaragua.Average rate of duty (%)
MFN Preferential
 WT/REG206/3 
Page 20  
 
  38. Chart III.6 shows a comparison of average du tiable rates in those HS chapters where 
preferential duties remain at the end of the implem entation period.  The comparison is made between 
Nicaragua's average preferential and MFN rates for lines which remain subject to preferential duties 
only.  For products in HS chapters 8 (edible fruits  and nuts), 9 (coffee, tea, mate and spices), and 
18 (cocoa and cocoa preparations), preferential duti es are reduced by around 5 percentage points with 
respect to MFN duties.  For sugar products (HS ch apter 17), preferential duties remain high:  29.2% 
compared to MFN rate of 30.4%. 
0 5 10 15 20 25 30 3518170908Chart III.6
Nicaragua:  Average of dutiable rates, by HS Chapter
HS Chapter  
Source : WTO Secretariat estimates, based on data provided by Nicaragua.Average rate of duty (%)
MFN Preferential
 
3. Tariff Rates Quotas 
(a) Sugar 
39. The Treaty provides additional market access for sugar and sugar-containing products 
(HS 1701.11.01, 1701.11.99, 1701.12.01, 1701.12.99, 1701.91 (except those containing flavourings), 
1701.99.01 and 1701.99.99) originating in Nicaragua and imported by Mexico through the application 
of TRQs, in accordance with the procedures described in Annex 2 to Article 4-04.  
40. Annex 2 states that when, in a given year, Mexico needs to import sugar it will open a global 
quota and reserve a part of it for sugar originating in Nicaragua.  For the first four years of implementation of the Treaty, a 20% share was a llocated to sugar from Nicaragua receiving duty-free 
treatment (Paragraph 2);  the out-of-quota duty corr esponded to the MFN rate applied by Mexico in 
the year of importation (Paragraph 4).
18  Where Mexico does not need to import sugar in a specific 
                                                      
18 In 2009, the MFN rate applied by Mexico to sugar was 0.338 US$/Kg for tariff lines 1701.11.01 and 
1701.11.99; and 0.36 US$/Kg for tariff lines 1701.12. 01, 1701.12.99, 1701.91.01, 1701.99.01, and 1701.99.99.  WT/REG206/3 
 Page 21 
 
 
  year, it will not open any quota;  as a consequence,  Nicaragua shall not benefit from preferential 
treatment for sugar during that year (Paragraph 3). 
41. On 20 October 2004, the Administrative Commission agreed that, as from 1.1.2005, the quota 
allocated by Mexico to sugar originating in Nicar agua would be reduced to 10% of the overall quota 
quantity.  The in-quota rate continues to be duty -free, provided that the import complies with the rules 
of origin established in Annex 6-03 to the Treat y, whereas the out-of-quota duty corresponds to the 
MFN rate applied by Mexico in the year of importation.19  
42. At multilateral level, Mexico applied a global tari ff rate quota to sugar and products with high 
sugar content listed in its Schedule of concessions  over the period 1995-2004;  the initial quota was 
set at 110,000 tonnes and the final quota at 183,800 t onnes.  Mexico's last WTO TRQs notification for 
products with high sugar content, covering th e period 1996-99, was made in December 2000.20  
Nicaragua is not to apply TRQs on imports from Mexico under the Treaty;  however, at multilateral 
level, Nicaragua reported TRQs on sugar (HS 1701) in 2009 covering the period 2005-08;  these 
amounted to 48.3 short tonnes per year.21 
(b) Textiles and clothing 
43. Article 3-15 provided temporary flexibilities for textile products include d in Chapters 61 and 
62 of the HS that did not meet the Treaty's rule s of origin.  Such products benefited from the 
preferential tariff treatment indicated in the TRP for the corresponding product and from flexible rules 
of origin when being imported within the following periods and values:  
- from 1.7.1998 to 30.6.1999, up to US$125,000; 
- from 1.7.1999 to 30.6.2000, up to US$145,000; 
- from 1.7.2000 to 30.6.2001, up to US$165,000; 
- from 1.7.2001 to 30.6.2002, up to US$170,000;  and 
- from 1.7.2002 to 30.6.2003, up to US$175,000. 
44. Within these quotas, textiles imports were to satisfy  the following origin criteria:  (a) a change 
in tariff classification from headings 61.01 to 61.17 of  any other chapter, and from headings 62.01 to 
62.17 of any other chapter;  and (b) be cut (or m achine woven) and sewn, or otherwise assembled in 
the exporting Party (Paragraph 2).  Exports of produ cts classified under the same tariff heading could 
not exceed 25% of the value of the total annual quota;  if they did, then the normal rules of origin as 
established in Annex 6-03 applied.   
45. As from 1.7.2003 the system of temporary flexibilities had lapsed and only the corresponding 
preferential tariff in the TRP is applied. 
46. The Treaty was supplemented by an Additional Protocol on cumulation for textiles products 
which added Article 3-16 and its re lated Annex to the Treaty.  The Protocol provides preferential 
tariff treatment for textiles products in HS Chapte r 62 which include materials originating in the 
United States.   The Protocol entered into force on 15 August 2008 and forms an integral part of the 
                                                      
19 Source: http://www.sice.oas.org/TPD/ MEX_NIC/Decisions/Dec7_s.pdf  
20 See Document G/AG/N/MEX/11. 
21 See Document G/AG/N/NIC/23. WT/REG206/3 
Page 22  
 
  Treaty.
22  Its provisions have been implemented th rough Decision No 13 of the Administrative 
Commission.23 
47. According to the Protocol, Mexico shall gran t duty-free access annually for up to 70 million 
square metres of textile imports from Costa Rica,  El Salvador, Guatemala, Honduras, or Nicaragua, 
that are considered to be originating in accordan ce with the Annex's provisions and subject to the 
following sub-limits (Articl es 3 and 4 of Annex 3-16):  
(a) up to 31.5 million square metres for trousers and skirts made of cotton, synthetic or 
artificial fibres included in categories 342, 347, 348, 642, 647 or 648, excluding those 
subheadings in paragraph b) below; 
(b) up to 14 million square metres for trousers made of a mixture of materials 
(mezclilla azul ) included in subheadings 6203.42aa or 6204.62aa, and skirts made of 
a mixture of materials included in subheading 6204.52.aa;  and 
(c) up to 1 million square metres for wool pr oducts included in textile categories 433, 
435 (subheading 6204.31 or 6204.33aa, 6204.39aa, or 6204.39.dd), 442-444, 447, or 448 and included in heading 62.03 or 62.04.
24 
48. The global quota shall be increased up to a maximum of 200 million square metres per year 
(Article 5, Annex 3-16).  Where the allocated quot a reaches 90% of the global quota in a given year, 
Mexico shall automatically increase it up to the leve l of the quota allocated by the United States to 
Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua in the framework of the Free Trade Agreement among the Dominican Republic, Centra l America and the Unite d States (CAFTA-DR, 
Appendix 4.1-B) (Article 5, Decision 13).  
49. Mexico shall administer the global quota and a llocate it among the parties on a "first come, 
first served" basis for three years starting on 1.5.2008  (Article 3, Decision 13).  Six months before the 
end of the three-year period, the Parties shall m eet with Costa Rica, El Salvador, Guatemala and 
Honduras, to evaluate and agree on a new administrati ve mechanism;  in the absence of a decision, the 
"first come, first served" method shall con tinue to apply (Article 4, Decision 13).
25 
50. Textiles covered by Article 3-16 must respect the rules of origin established in the Treaty.  
However, textiles which are:  (a) used in the producti on of a good of Chapter 62 in the territory of the 
United States and that qualify as originating under the Treaty;  and (b) produced in the territory of the United States, used in the production of textiles unde r HS Chapters 50-60, and subsequently used in 
the production of a good in Chapter 62 and that qualify as originating under the Treaty, are to be considered as produced in the territory of th e exporting Party (Article 8, Annex 3-16).   
51. The proof of origin of textiles materials orig inating in the United States and used in the 
production of goods in Chapter 62 and that enter Me xico under preferential treatment, shall conform 
                                                     
 
22 The Protocol was approved by the General Assembly of Nicaragua by means of Decree No 5157 and 
ratified by the President of the Republic by means of Decree No 105-2007.  Information provided by the Parties. 
23 Source:  http://www.sice.oas.org/TPD/ME X_NIC/Decisions/Dec13_s.pdf  
24 The categories of textile products concerned by  this provision are liste d in the Appendix to 
Annex 3-16. 
25 Once the Parties have agreed on a "distributio n per country" mechanism, Mexico shall increase 
Nicaragua's quota –where it reaches 90% of utilization - in accordance with the follo wing formula: (maximum 
quota of the United States) – (maximum quota of Mexico) X (the factor of proportion) (Article 6, Decision 13).  
The maximum United States quota is its  quota allocated to Costa Rica, El Salvador, Guatemala, Honduras and 
Nicaragua in accordance with the Appendix 4.1-B of the CAFTA-DR Agreement.  The maximum quota of 
Mexico is the annual global quota.  The factor of proportion corresponds to the quota allocated to Nicaragua.  WT/REG206/3 
 Page 23 
 
 
  with the Agreement between Mexico and the Unite d States on Customs Cooperation in relation to the 
Declaration of Origin made in the framework of the Provisions on Cumulation of certain Free Trade 
Agreements, signed on 26 January 2007.  A model of the certificate of origin is attached to Decision 
No. 13;  it is valid for 90 days following its subm ission to Mexico's competent authorities.  For all 
other goods, the proof of origin shall be made in accordance with the Treat y's provisions in this 
respect (Article 17, Annex 3-16).   
52. Under Article 19 of Annex 3-16, Mexico may deny  preferential tariff treatment when:  (a) the 
producer or exporter of a good classified under HS Chapter 62 does not provide information required 
to verify the origin of the good;  or (b) the prod ucer of textiles from the United States or Nicaragua 
hinders the verification of origin.   
53. In the event of any incompatibility between the Additional Protocol and the Treaty, the 
provisions of the Protocol shall prevail to the extent  of the inconsistency (Ar ticle 26, Annex 3-16).  
Table III.5 
Summary of the TRQs under the Treaty 
Products Country Periods Quotas In-quo ta / ex-quota rate 
1.7.1998-1.7.2001 20% reserved for Nicaragua Duty-free/MFN Sugar 
HS 1701.11.01 
1701.11.99 
1701.12.01 1701.12.99 
1701.91 (except those 
containing flavourings) 1701.99.01 
1701.99.99 Mexico 
as from 1.1.2005 10% reserved for Nicaragua Duty-free/MFN 
1.7.1998-30.6.1999 <= US$125,000 
1.7.1999-30.6.2000 <= US$145,000 
1.7.2000-30.6.2001 <= US$165,000 
1.7.2001-30.6.2002 <= US$170,000 
1.7.2002-30.6.2003 <= US$175,000 Textiles  
HS Chapters 61 and 62 Mexico and 
Nicaragua 
as from 1.7.2003 - Preferential+  
flexible ROO 
 
 
Preferential 
Textiles 
HS Chapter 62 
incorporating materials 
originating in the United States  Mexico as from 15.8.2008 <= 70 million square metres 
+ sub-limits 
(not > 200 million) Duty-free/MFN 
 
Source: The Treaty. 
 
B. RULES OF ORIGIN  
54. Rules of origin are set out in Chapter VI.  A ccording to Article 6-03, a good is considered to 
be originating when:  
(a) it is wholly obtained or entirely produced in the territories of the Parties26; 
                                                      
26 According to Article 6-01, "goods wholly obtained or entirely produced in the territories of the 
Parties" means:  (a) mineral goods extracted in the Par ties' territories;  (b) vegetable goods harvested in the 
Parties' territories;  (c) live animals born and raised in th e Parties' territories; (d) goods obtained from hunting or 
fishing;  (e) fish, shellfish and other marine species taken from the sea by vessels registered or recorded with a 
Party and flying its flag;  (f) goods produced on board factory ships from the goods referred to in subparagraph (e) provided such factory ships are re gistered or recorded with a Party and fly its flag;  (g) goods taken by a 
Party or a person of a Party from the seabed or beneath the seabed outside territorial waters, provided that a WT/REG206/3 
Page 24  
 
  (b) it is entirely produced in the territories of the Parties and exclusively from originating 
materials; 
(c) it is entirely produced in the territories of the Parties and all of the non-originating 
materials undergo a change in tariff classification, comply with the regional value content, or meet the requirements as established in Annex 6-03
27;  or 
(d) unassembled goods and goods classified with their parts which, though not meeting 
specific origin rules, contain not less than 50% of the regional value content (RVC), using the transaction method, or not less th an 41.66%, using the net cost method.  
This does not apply to goods under HS Chapters 61-63, which are regulated by the provisions of Annex 6-03.
28 
55. When a good is produced from non-originating materials, it must undergo a change in tariff 
classification (CTC) and, in some cases, satisfy  the RVC requirement in order to obtain the 
originating status.  The CTC method applies generally at the HS heading level  but requirements at the 
subheading and chapter levels are also frequent.  
56. Bilateral cumulation applies between the Partie s (Article 6-08).  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 adde d into the RVC calculation – also applies, except 
for certain automotive products.  This is also the case for those materials wh ich have been designated 
as "intermediate material" by the producer.  When an intermediate material is subject to a RVC 
requirement, only the net cost method can be used;  further, only one locally produced material 
subject to a RVC requirement may be designate d as intermediate material (Article 6-07). 
57. The RVC is the difference between the value of the good and that of the non-originating 
materials, and can be calculated on the basis of the transaction value method – where non-originating 
materials are valued as a percentage of the total pri ce paid for the good adjusted on a f.o.b. basis – or 
the net cost method – where these are valued as a pe rcentage of net producer's costs (Article 6-04).29  
While the exporter/producer can generally choos e to calculate the RVC under either method, 
paragraph 5 specifies the cases where only  the net cost method can be used.30  Article 6-20 establishes 
that a good produced in the territory of one or bo th Parties (except goods included in Article 6-15) 
should have a RVC of no less than: 
                                                                                                                                                                     
Party has rights to exploit such seabed;  (h) waste and scrap derived from the production in the territory of either 
or both Parties;  or used goods collected in the territory  of either or both Parties,  provided such  goods are fit 
only for the recovery of raw materials;  (i) and goods produced in the territory of either or both Parties exclusively from goods referred to in subparagraphs (a) through (h), or from their derivatives, at any stage of 
production. 
27 Annex 6-03 and its Appendix, and Annex 1 to Article 6-15 have been modified by Decision N.12 
of the Administrative Commission, of 18 February 2008 to comply with the Third Amendment to 
the Harmonized System of Designation and Codification of Goods, Version 2002.  Decision N.12 
entered into force on 30 April 2008, upon comp letion of the Parties' legal procedures. 
http://www.sice.oas.org/TPD/ME X_NIC/Decisions/Dec12_s.pdf  
28 The specific rules of origin for products in HS chap ters 61-63 require a change in tariff classification, 
except for headings, sub-headings, and chapters that contain textile raw materials. 
29 In the net cost method, the value is composed of the total net cost minus costs relating to marketing, 
sales and other after-sales services, etc.  The product's to tal cost results from the addition of the costs of direct 
inputs used in the production, labour and other direct and indirect production costs.  The Annex to Article 6-04 contains detailed rules relating to net cost calculations.   
30 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 price are dependent on some type of counterpart;  the buyer and seller are related and this relationship has influenced the price;  the exporter or producer are cumulating the 
RVC;  the good is a motor vehicle or a part thereof;  or the good has been de signated as an intermediate good.     WT/REG206/3 
 Page 25 
 
 
  (a) 45% under the transaction value method, or 37.5% under the net cost method, from 
1.7.1998 to 30.6.2001; 
(b) 46% under the transaction value method, or 38.5% under the net cost method, from 
1.7.2001 to 30.6.2002;  and 
(c) 47.5% under the transaction value method, or 40% under the cost method, from 
1.7.2002 to 30.6.2003.   
58. Under Annex 6-03, the RVC applicable as from 1.7.2003 is not less than 50%, using the 
transaction method, or not less than 41.66%, using the net cost method. 
59. Article 6-05 stipulates that the value of a material is its transaction value;  where this does not 
exist or is unacceptable under Article 1 of the Custom s Valuation Code, the value will be calculated in 
accordance with the principles of Articles 2-7 of th e Customs Valuation Code.  The value of inputs 
shall also include the price of freight, insurance, packaging and other transport costs, as well as the 
cost of waste and spoilage resulting from the use of the inputs in the production of the good, less any 
costs recovered provided that these do not exceed 30% of the value of the material.  Moreover, to 
calculate the RVC (except for motor vehicles under Article 6-15.3 and their components under 
Annex 6-15.2), the value of non-originating inputs used in the production of a good shall not include 
the value of non-originating inputs used by: (a) another producer in the production of an originating input, which is acquired and used by the producer in the production of the good;  or (b) the producer of the good in the production of an originating intermediate input. 
60. Under Article 6-06, a de minimis  rule applies as follows: 
(a) the CTC requirement is waived if the value of all non-originating materials that do 
not comply with the required CTC is less th an 7% of the transaction value, adjusted 
as appropriate, or, when relevant, the total cost of the good;  in these cases, the good will be considered as originating.  An y 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% of the transaction value or, when rele vant, the total cost of the good;  in these 
cases, the good will be considered as originating. 
61. This rule does not apply for the following: 
(a) textiles goods in HS Chapters 50-63;  howe ver, if the good is non-originating because 
the fibre and the yarns used do not comply with the CTC requirements, the good will nonetheless be considered originating if th eir total weight does not represent more 
than 7% of the material's total weight; 
(b) a non-originating material used in the pr oduction of goods in Chapters 1-27, unless 
the material is from a different sub-headi ng from that for which the origin is being 
determined. 
62. Article 6-16 lists all operations and practices that do not confer  originating status.  Under 
Article 6-17, even if a good satisfies the requirements of Article 6-03, it loses its originating status if it 
undergoes any further processing outside the territory of  the Parties, "other than unloading, reloading 
or any other operation necessary to preserve it in good c ondition or to transport it".  Transit – with or 
without transhipment and storage – is authorized provided the good remains under the surveillance of 
the customs authorities (Article 6-03.2). WT/REG206/3 
Page 26  
 
  63. Article 6-15 provides for specific rules of origin  for the automotive sector, which details the 
manner in which to calculate the RVC (obligatory us e of the net cost method, differentiated treatment 
vis-à-vis  the absorption principle) of different categor ies of automotive products in Paragraph 2.
31  
64. Article 6-18 establishes the "Committee on Rules of Origin", comprising representatives of 
both Parties.  It shall convene at least twice a year, or upon the request of either Party.  Its functions 
are:  (i) ensuring the proper implementation and administration of the Chapter's provisions;  
(ii) resolving issues related to interpretation, im plementation, and administration of the Chapter;  
(iii) reviewing annually, in relati on to non-allowable interest costs, the percentage points above the 
highest interest rate on government bond issu ed by federal or central governments32; and (iv) 
considering any other matter the Parties may agree.  The Committee, following a request by a Party, 
shall decide on modifications to the Treaty and make recommendations. 
Box III.2:  Rules of Origin at a Glance 
• Product-specific criteria 
 - Wholly obtained goods. 
 - CTC, generally at change of heading.  - RVC at 50% on transaction value method, 41.66% at net cost method, generally applied in 
conjunction with the CTC 
• Bilateral cumulation 
• Absorption principle applies with exceptions 
• Tolerance rule applies 
• Duty-drawback applies 
• No outward-processing authorized  
 
Source:   Chapter VI of the Treaty. 
 
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
65. Under Article 3-09, export restrictions or prohibitions other than those authorized under 
Article XI of the GATT 1994 (which is incorporated  into the Treaty) are prohibited;  export prices 
other than those applied in the context of price undert akings are also forbidden.  Nothing in the Treaty 
limits however the possibility of a Party to enforce restrictions applied vis-à-vis  exports from a third 
party in such a way as to avoid circumvention of these restrictions.  Exceptions are provided for in 
Annexes 3-03 and 3-09.33  
66. Export duties, taxes or charges are also prohib ited under the Treaty, unless they are applied on 
goods destined for domestic consumption and on ba sic foodstuffs, their ingredients, or goods from 
which the foodstuffs are derived (Article 3.10).34  In the latter case, export taxes are permitted to 
(a) maintain the benefits of a domestic food pr ogramme, which includes such foodstuffs, for domestic 
                                                      
31 Article 6-15 covers any automotive vehicles included in headings 87.01- 87.06. 
32 The Parties indicated that non-allowable interest co sts are relevant for the calculation of the net cost, 
the methodology used in the calculation of the RVC. 
33 See Annex II to this presentation. 
34 Basic foodstuffs include: beans, beef liver, beef remnants and bones, beef steak or pulp, beer, bread, 
brown sugar, canned peppers, canned sardines, canned tuna, cheese, chicken broth, condensed milk, cooked 
ham, corn, corn dough, corn flour corn tortillas, cracker s, eggs, evaporated milk, fillet of fish, French rolls, 
gelatine, ground beef, instant coffee, low-priced cookies,  margarine, meat of poultry, oak flakes, pasteurized 
milk, powdered chocolate, po wdered milk, powdered milk for children, rice, roasted coffee, salt, soft drinks, 
soup paste, tomato purée, vegetable fat, vegetabl e oil, wheat flour, white sugar (Article 3-10.3).  WT/REG206/3 
 Page 27 
 
 
  consumers;  or (b) ensure the availability of su fficient foodstuffs, their ingredients, or goods from 
which such foodstuffs are derived, to domestic cons umers in the event of a fall in domestic prices 
below world prices due to a government stabilizati on plan, provided that such export taxes do not 
increase the protection afforded to the domestic ma rket and are applied during a period necessary to 
maintain the integrity of the stabilization plan.  Export taxes on foodstuffs are also temporarily 
permitted (up to one year, unless otherwise agreed by the Parties) to relieve critical shortages.35 
D. REGULATORY PROVISION S ON TRADE IN GOODS  
1. Standards 
(a) Technical barriers to trade 
67. Chapter XIV applies to any technical regulations that may affect, directly or indirectly, trade 
in goods and services between the Parties.  The Par ties reaffirm their rights and obligations under the 
WTO Agreement on Technical Barriers to Trade (TBT  Agreement) and all international agreements 
on security, protection of human, animal and plant lif e, and the environment to which they are party 
(Article 14-03).   
68. Measures necessary to comply with  the Chapter's provisions are to be adopted by the Parties' 
central, regional or municipal governments and,  as far as possible, accredited non-governmental 
standardization organizations in their territories (Ar ticle 14-02.2).  Each Part y must ensure that its 
standards-related measures do not create unnecessary ba rriers to trade and do not restrict trade more 
than is necessary to fulfil its legitimate objectiv es, taking into account the risks non-fulfilment would 
create (Article 14-04).  When applying standards-re lated measures, each Party shall accord national 
and MFN treatment to goods and services provide rs of the other Party (Article 14-04.5). 
69. The Parties have committed on a best endeavours basis to make compatible and equivalent 
their respective technical regulations and conformity assessment procedures with existing international standards (Articles 14-06 and 14-07) and, when they act or create unnecessary barriers to 
trade, their metrological standards (Article 14- 11).  They shall also develop common labelling 
requirements based on research and recommendations  by the "Labelling, Packaging and Packing 
Standards Subcommittee" (Article 14-15). 
70. Pursuant to Article 14-08, each Party shall inform  the other of it's technical regulations before 
their entry into force and not  later than its nationals.
36  Each Party shall also establish at least one 
enquiry point in its territory to provide inform ation to interested persons of the other Party 
(Article 14-09).  The Treaty does not require th e Parties to provide information which would 
prejudice the legitimate commercial interests of  a particular enterprise (Article 14-10).  
71. Under Article 14-12, each Party may subject to  national registration procedures, on public 
health protection grounds, the following products:  me dicines;  medical equipment and instruments;  
pharma-chemicals and other goods destined for human, animal and plant health use;  toxic goods and 
substances;  radioactive goods, sources, or equipm ent; and sources and equipment transmitting ionic 
radiations.  Where appropriate, these products shall be registered, recognized and evaluated by the 
Party's competent governmental or non-governmental authorities and obtain a certificate of 
                                                      
35 Nicaragua indicated that, as at June 2010, it has not applied export duties or other charges. 
36 The Treaty establishes that a Party shall notify the other about a measure's adoption or modification 
60 days in advance (30 days in case of perishable goods).  In the event of an urgent problem relating to the 
safety or protection of human, animal and plant life or health, the environment, or customers, a Party may not respect those requirements, provided that it immediately notifies the other Party, or any other interested person 
that so request,  of the measure taken  (Article 14-08.2 and 6).   WT/REG206/3 
Page 28  
 
  compatibility with its compulsory national system.  Each Party may conduc t risk-assessments based 
on international standards in its territory when it d eems appropriate, provided that they do not result in 
arbitrary or unjustifiable discrimination or restrictio ns to bilateral trade (Article 14-13).  The Parties 
shall apply guidelines or recommendations by th e United Nations and re levant international 
agreements on the protection of the environment to wh ich they are party.  They shall also regulate and 
control the production, introduction, and marketing of hazardous substances and waste 
(Article 14-14).   
72. Article 14-16 establishes a Committee on Standards-Related Measures, comprising 
representatives of each Party's competent governmental institutions.
37  The Committee shall convene 
at least once a year and when requested by either Part y and shall take decisions by consensus.  It shall 
establish its own regulations and any other subsidiary bodies it considers appropriate.38  According to 
Article 14-18, where a Party has questions on the interpretation or application of the Chapter's 
provisions, it shall request consultations within th e Committee or the Treaty' s dispute settlement body 
(Article 20-11).39 
(b) Sanitary and phytosanitary measures 
73. Chapter V applies to any sanitary and phytosan itary (SPS) measures which may directly or 
indirectly affect bilateral trade (Article 5-02).  E ach Party may establish, adopt, maintain or apply SPS 
measures, including for food safety, that may result in the prohibition from import of a specific product when it does not comply with the applicab le requirements or with the importing Party's 
approval procedures.  The Parties may also adopt or ma intain a measure that is more stringent than the 
relevant international standard, provided that it is based on scientific principles,  to achieve appropriate 
levels of protection (Article 5-03).  Each Party maintains the right to establish its own level of 
protection of human, animal and plant life and hea lth, providing that the conditions in Article 5-06 
(risk assessment and adequate level of protection) are respected (Article 5-03.5).  The Parties shall 
endeavour, as far as possible, to harmonize their respective SPS measures (Article 5-05). 
74. SPS measures must be based on scientific principles and appropriate risk assessment 
(Article 5-03.2);  not arbitrarily and unjustifiably discriminate between the Pa rties' goods, or between 
goods from a Party and similar goods from any othe r country, where identical or similar conditions 
prevail (Article 5-03.3);  and not constitute a disgui sed restriction on bilateral trade (Article 5-03.4).  
Where a Party maintains that a SPS measure of the other Party adversely affects, or may adversely affect, its exports and is not based on a relevant international standard, it may request information 
about the measure.  The information will be provided within 30 days of the request.   
75. Under Article 5-07, the Parties shall recognize the concept of pest and disease-free areas and 
those with low pest or disease prevalence.  A Party wishing to obtain such recognition shall make a 
request to the other Party and provide it with all the necessary scientific and technical information. 
The other Party shall respond within a mutually agreed time-frame and an y negative response must 
also be accompanied by scientific and technical justification for the decision.   
76. Under Article 5-08, control, inspection and approval procedures must be completed as 
expeditiously as possible.  Transparency provisions under Article 5-09 require each party to notify the 
                                                     
 
37 The Parties indicated that, as at June 20 10, the Committee has not been established. 
38 In particular, the Committee on Standard-Related Measures sha ll set up: the Health Standards 
Subcommittee;  the Labelling, Packaging and Packing Standards Subcommittee;  the Telecommunications 
Standards Committee (Article 14-16.5). 
39 A Party may not use both mechanisms simultaneo usly.  If the technical recommendation issued by 
the Committee does not solve the matter, the Parties may invoke the dispute settlement mechanism under the 
Treaty (Article 14-18.4).  WT/REG206/3 
 Page 29 
 
 
  other of any SPS measure that could affect bilatera l trade 60 days before its adoption or modification 
(30 days for perishable goods).  In case of "urgent problems" a Party may adopt a measure without respecting the notification procedure, providing that  it immediately notifies the other Party of the 
measure adopted.  Where the importing Party denies entry to a good of the other Party into its territory 
because it does not comply with its SPS standards, it shall notify in writing the exporting Party within 
seven days, with an explanation for the denial.  Each  Party shall appoint within 30 days from the entry 
into force of the Treaty a government authority in its territory which is responsible for the 
implementation of the notification.
40  They shall also establish at least one enquiry point 
(Article 5-10).  Article 5-11 does not require the Parties to provide any confidential information 
whose disclosure could prejudice the legitimate commercial interests of an enterprise.   
77. The Committee on Sanitary and Phytosanita ry Measures (SPS Committee) has been 
established under the Treaty (Article 5-12).  To date, the SPS Committee has held several meetings 
(in July 2001, October 2002, August 2003, March 2004, and June 2005), during which it has adopted, 
inter alia , decisions on:  Nicaragua's export requirement s for mango, papaya, melon, and watermelon; 
recognition by Nicaragua of Sinaloa, Sonora, a nd Baja California (excluding Chihuahua) as fruit fly 
free zones;  Mexico's export requirements for pitaha ya and pineapple, and tilapia;  authorization by 
Nicaragua for the Mexican enterprise Tyson for po ultry and meat;  information by Nicaragua on 
future legislation regarding milk products and derivates;  Nicaragua 's requirements for meat products 
from Mexico;  exchange of information on sanitary re quirements for trade in live animals, before their 
shipment;  information by Mexico on its verificat ion and inspection point in Hidalgo, Chiapas;  
technical cooperation in the control procedures of  "gusano rosado" and in the traceability of bovine 
and vegetables;  information by Nicaragua on the verification visit to the enterprise Delmor;  
recognition by Mexico of Nicaragua as a disease -free area for cheese production;  and exchange of 
information on measures adopted for wood packaging.41 
78. The Parties shall provide each other with  technical cooperati on and assistance on SPS 
measures (Article 5-13).  Consultations may take place within either the SPS Committee, ad hoc  
working group, or any other forum for non-binding technical advice or recommendations.  Each Party 
shall also resort to the good offices of releva nt international standardization organizations 
(Article 5-14).  When a Party considers that the ot her Party interprets or applies a SPS measure in a 
manner inconsistent with the Chapter's provisi on, it shall demonstrate such incongruence 
(Article 5-15).  
2. Safeguard mechanisms 
(a) Global safeguards 
79. Chapter VIII deals with global and bilateral sa feguard measures.   The Parties retain their 
rights and obligations under Article XIX of th e GATT 1994 and the WTO Agreement on Safeguards, 
except those regarding compensation or retaliation and exclusion from an action to the extent they are 
inconsistent with the Chapte r's provisions (Article 8-05). 
80. Each Party may apply a global safeguard on imports from the other Party on the condition 
that such imports individually account for a "subs tantial share" of total imports and "contribute 
importantly" to serious injury, or the threat thereof, to the domestic industry of the importing Party (Article 8-06).  Imports from a Party are considered to  be "substantial" if that Party is among the main 
suppliers whose collective exports am ount to 80% of total imports of  similar or directly competitive 
                                                     
 
40 The responsible authority in Ni caragua is the General Director ate of Agriculture Health and 
Protection of the Ministry of Agriculture and Forestry.  Mexico did not provide information on its responsible authority. 
41 Information provided by the Parties. WT/REG206/3 
Page 30  
 
  goods of the importing Party;  and are considered to  "contribute importantly" to serious injury, or the 
threat thereof, if their growth rate during th e period in which the inju rious surge occurred is 
appreciably lower than the growth rate of total im ports of similar or directly competitive products of 
the importing Party from all sources ove r the same period (Article 8-06.2). 
81. The Party taking a global safeguard shall provide the other with  mutually agreed 
compensation in the form of additional concessions  having substantially eq uivalent effects on its 
exports to the safeguard.  If the Parties are unabl e to agree on compensation, the importing Party is 
authorized to apply the safeguard and the exporting Party may impose tariffs with effects equivalent 
to the safeguard (Article 8-07).  
(b) Bilateral safeguards 
82. Bilateral safeguard measures may be applied wh en, as a consequence of the implementation 
of the TRP, one or more goods originating in the territory of a Party are imported into the other Party 
in such increased quantities and under such conditions as to cause, or threaten to cause, serious injury 
to the domestic industry producing a like or direc tly competitive good.  In this case, the importing 
Party may, to the minimum extent necessary to re medy or prevent the injury, adopt temporary and 
exclusively tariff-based bilateral measures.  Under no circumstances may safeguards exceed the lesser 
of the MFN applied duty in effect at the time th e action is taken and on the day immediately preceding 
the date of entry into force of the TRP (Article 8-03).
42 
83. Bilateral safeguards may be applied for one year , renewable once for another year.  They may 
be extended for a third year only in justified cases and if the applying Party determines that the 
domestic industry affected by the measures has made  competitive adjustments and requires renewal of 
the measure (Article 8-03).  A Party that intends to apply bilateral measures shall provide the other 
with mutually agreed compensation in the form of  additional tariff concessi ons having equivalent 
effect on its exports to the bilateral action.  If th e Parties fail to reach an agreement on compensation, 
the importing Party is authorized to apply the saf eguard, and the exporting Party may impose tariff 
measures with equivalent effects on its exports to the safeguard.  
84. The procedure for the adoption of safeguard meas ures, both global and bilateral, is described 
in Section C of Chapter VIII.   The importing Party sh all initiate an investigatio n procedure, either on 
its own initiative or upon request of the other Party, in order to evaluate th e volume and conditions of 
import and verify the existence, or threat of serious injury to the domestic industry43 and the direct 
causality between the increase in imports and the serious injury (Article 8-09).44  Consultations shall 
start the day after the request's receipt by the exporting Party, and shall last 30 working days, unless otherwise agreed (Article 8-14).  The Parties are not required to provide an y confidential information 
during consultations that may violate domestic la ws or damage legitimate commercial interests 
(Article 8-15).  The Treaty provides for the possibility to extend the measure where the importing Party finds a persistence in the conditions that justif ied its application.  The competent authority of the 
importing Party shall notify the exte nsion to the exporting Party at least 60 days before the measure 
expires (Article 8.17).  The extension is subject to the same procedures as for its initial adoption.  
                                                     
 
42 Article 8-03(e) specifies that when the bilateral measure expires, the rate or tariff shall be that 
corresponding to the good subject to the bilateral action at the date under the TRP. 
43 According to Article 8-10, to determine the exis tence of serious injury, or threat thereof, the 
investigating authority shall take into  account:  the rate and amount of incr ease in imports of the goods, in both 
absolute and relative terms;  the share of the domestic market taken by the increased imports;  and the changes 
in the level of sales, domestic prices, production, productivity, capacity utilization, profits and losses, and 
employment. 
44 Article 8-09.2 requires that the request to start th e investigation is supported by domestic producers 
whose collective production represents at least 35% of th e total production of the similar or directly competitive 
product.    WT/REG206/3 
 Page 31 
 
 
  3. Anti-dumping and countervailing measures 
85. The Parties reject any unfair international tr ade practice that is contrary to the Treaty's 
provisions (Article 9-02).  Chapter IX mainly descr ibes the procedures to be followed by the Parties' 
investigating authorities to establish the existence of dumping.45  When the importing Party 
determines the existence of dumping, or export subsid ies, and of injury, or serious injury that are a 
direct consequences of imports of identical or similar products of the other Party, it may apply 
countervailing measures in accordance with its dom estic legislation, the Treaty's provisions, and the 
WTO Agreements (Article 9-05).   
86. The Parties shall publish resolutions launching an d concluding investigations (Article 9-07).46  
During the investigation, any interested person ma y request the investigating authority to hold 
conciliation hearings to reach a sa tisfactory solution (Article 9-13)  and, upon written request, to hold 
information meetings (Article 9- 14) and public hearings for inte rested persons (Article 9-15). 
87. The Parties may not adopt any provisional coun tervailing measures within 60 working days 
from the publication of the resolution launching the in vestigation (Article 9-10) .  Once the provisional 
or final measure has been adopted, interested pe rsons may request the investigating authority in 
writing to determine whether a good is subject to the measure or clarify any aspect of the resolution 
(Article 9-19).  The measures must  be reviewed annually upon written request by interested persons47 
and, at any time, by the competent authorities and must be ratified, modified, or eliminated accordingly (Article 9-20).  A countervailing measure sh all be eliminated automatically if, after five 
years from the day following its publication, the inte rested persons have not requested a review and 
the competent authority has not initiated a re view on its own initiative (Article 9-17).
48 
4. Subsidies and State-aid 
88. Article 9-03 prohibits the Parties from increasing, upon the Treaty's entry into force, subsidies 
above 7% of the f.o.b. export value of the product.   
89. The Treaty provides for the abolition of export s ubsidies on agricultural products once tariffs 
on agricultural products reach zero according to the TRP,  and in no circumstances later than 1.7.2007.  
In addition, at the Treaty's entry into force, neither Party shall maintain export subsidies on 
agricultural products included in Article 5 of the Export Promotion Decree 37-91 by Nicaragua nor on 
products subject to TRQs under the Treaty.49 
                                                      
45 The investigating authorities are: for Mexico, the Unit of International Trade Practices of the 
Ministry of Trade and Industrial Development, or its su ccessor;  and for Nicaragua, the Directorate General of 
Economic Integration of the Ministry of Economic Affairs and Development, or, as appropriate, the directorate 
with jurisdiction over matters relating to Central American economic integration, or the unit responsible for investigating unfair trade practices, or its successor (Annex 2 to Article 9-01). 
46 The resolutions will be published in the Official Gazette of the Federation (Diario Oficial de la 
Federación) for Mexico, and in a daily newspaper with national circulation, without prejudice to its subsequent publication in the Official Gazette for Nicaragua  (La Gaceta, Diario Of icial) (Annex 9-07). 
47 The review may be requested in writing by interested persons that participated in the investigation, or 
by any producer, importer, or exporter which, without having participated in the investigation, can indicate legal interest in writing to the investig ating authority (Article 9-20.3). 
48 For Mexico, the Ministry of Trad e and Industrial Development, or  its successor; and for Nicaragua, 
the Ministry of Economy and Developmen t, or its successor (Annex 9-01.1). 
49 The Parties confirmed that, as at June 2010, they do not have export subsidies on agricultural 
products and that Decree No 37-9 1 elapsed on 31 December 1997. WT/REG206/3 
Page 32  
 
  5. Other regulations 
(a) Customs-related procedures 
90. Customs procedures are described in Chapter V II.  Pursuant to Article 7-02, the Parties 
agreed on the format of the certificate and declara tion of origin by a decision of the Administrative 
Commission, dated 1 July 1998.
50  The importing Party may request exporters of the other Party to 
provide the certificate of origin in order to obtai n preferential tariff treatment.  The certificate of 
origin is not required when:  (i) the value of  imports for commercial and non-commercial purposes 
does not exceed US$1,000 (or its e quivalent in national currency)51;  and (ii) when the importing 
Party exempts a good from the requirement to submit a certificate of origin (Article 7-05). 
91. The origin of a good may be verified by the importing Party's competent authorities through:  
(a) a written questionnaire to the exporter or producer in  the territory of the other Party; or (b) subject 
to prior notification, verification visits to the premis es of the exporter or producer in the territory of 
the other Party (Article 7-07).  The exporter or producer must return the questionnaire or approve the 
visit within 30 days, failing which the importing Pa rty may deny preferential tariff treatment to 
imports from the other Party. 
92. Under Article 7-08, each Party shall grant to exporters or producers of the other Party the 
same rights of review and appeal on determinations  of origin and advance rulings by its competent 
authority as it provides to its own importers.  E ach Party shall establish or maintain measures 
imposing criminal, civil or administrative penalties for violations of its laws and regulations in 
relation to the Chapter's provisions (Article 7-09) .  Article 7-10 describes the procedures for issuing 
advance rulings prior to the import of a good. 
93. A Customs Procedures Committee has been establi shed pursuant to Article 7-11.  It shall 
meet at least twice a year, and at the request of either of the Parties.  The Committee's functions are to seek agreement on:  (i) the interpretation, impl ementation, and administration of the Chapter's 
provisions;  (ii) matters related to product classificat ion and determination of origin;  (iii) procedures 
for submission, approval, expedition, modification, re pealing, and application of advance rulings;  (iv) 
modifications to the certificate of origin;  (v) an y other matters submitted by the Parties;  and to 
examine proposals on administrative or operational modi fications in customs matters that may affect 
trade between the Parties.  In 2004, the Parties ag reed, within the Customs Procedures Committee, an 
understanding on invoicing from third countries, that are considered as valid in order to grant tariff 
preferences under the Treaty.
52 
94. Textiles products in HS chapters 61 and 62 were subject to a system of temporary flexibilities 
as described in Article 3-15 (see Section III.3(b) ab ove).  In order to implement these provisions, the 
Parties adopted a decision of the Administrative Commission, dated 1 July 1998, which entered into force at the same time as the Treaty and was valid for a period of four years.
53  The decision required 
the exporting Party to submit to the importing Part y, upon import, a certificate of eligibility for 
preferential treatment (Paragraph 3).  The preferential treatment would be denied if the certificate was 
                                                      
50 Source:  http://www.sice.oas.org/TPD/ MEX_NIC/Decisions/Dec1_s.pdf  
51 In this case, it may be requested that the invoice co ntains a declaration of origin of the good by the 
importer or the exporter. 
52 Information provided by the Parties. 
53 Source: http://www.sice.oas.org/TPD/ MEX_NIC/Decisions/Dec2_s.pdf   WT/REG206/3 
 Page 33 
 
 
  not provided.  The certificate was issued by the certifying authority of the exporting Party54 and 
contained all the information specified in Paragraph 4.55   
95. The decision of the Administrative Commission lapsed on 1 July 2003. 
(b) Government Procurement 
96. Chapter XV covers all measures maintained or adopted by a Party in relation to the 
procurement of goods, services, and construction servi ces by (i) federal or central entities (listed in 
Annex I);  (ii) government or autonomous bodies (lis ted in Annex II);  or (iii) state, regional or 
municipal government bodies (listed in Annex III) (Article 15-02.1).  Non-contractual agreements or 
any form of government assistance (including c ooperative agreements, transfers, loans, capital 
transfers, grants, fiscal incentives, and governme nt provision of goods and services in favour of 
persons or state, regional, or municipal govern ments) and the acquisition of fiscal agency or 
depository services, liquidation and management servi ces for regulated financia l institutions, and sale 
and distribution services for government debt, are not  covered (Article 15-02.5).  Either Party may 
modify its coverage under the Chapter only in ex ceptional circumstances and after having notified the 
other Party, included the change in the appropr iate annex, and provide d it with appropriate 
compensatory adjustments to maintain the same le vel of coverage as be fore (Article 15-22).  
Article 15-24 provides for future negotiations to fu rther liberalize the Parties' procurement markets.56  
Neither Party is a signatory or an observer to  the WTO Agreement on Government Procurement. 
97. Strategic goods purchased by the Mexican Minist ries of National Defence and the Navy, and 
the Nicaraguan Ministries of Defence and of G overnance are excluded from the provisions of the 
Chapter.57  The Chapter shall apply to all services a nd construction services – except for those listed 
in Article 15-02.5- no later than one year afte r the entry into force of the Treaty (Annexes to 
Articles 15-02.5 and 15-02.6).58 
98. Thresholds vary for different groups of en tities according to the nature of purchases (goods, 
services, or construction services), and are calculate d and adjusted in line with the US rate of 
inflation, once every two years, starting in January 2000.59  The thresholds are:  US$50,000 or above 
for contracts for goods, services, or any combin ation thereof, and US$6.5 million or above for 
contracts for construction services by federal or  central government entities;  US$250,000 or above 
for contracts for goods, services, or a combin ation thereof, and US$8 million or above for 
                                                      
54 According to Paragraph 2 of the decision, "certifying authority" means: for Mexico, the authority 
appointed by the Ministry of Trad e and Industrial Development, or its successor; and for Nicaragua, the 
authority appointed by the Ministry of Economi c Affairs and Development, or its successor. 
55 These are: identification number, date of emission, name of the exporter, name of the importer, 
country of destination, invoice number, tariff classification of the good at 6-digit level, description of the good, 
value of the good in US dollars, eligibility criteria, name and signature of the exporting Party's competent 
authority. 
56 The Parties indicated that, as at June 2010, no further negotiations on government procurement have 
taken place. 
57 They include:  weaponry;  nuclear war material;  fire control equipment;  ammunition and 
explosives;  guided missiles;  aircraft and components of aircraft structures;  components and accessories for 
aircrafts;  equipment for takeoff, la nding, and on-ground handling of aircra ft;  space vehicles;  vessels,  small 
structure, rafts and floating piers;  maritime vesse ls and equipment (Annex to Article 15-02.4).   
58 Annex to Article 15-02.5 further requires the Parties to establish a workgroup to review relevant 
technical issues, including the common classification system for services described in the Annex. 
59 As measured by the Producer Price Index for Finished goods of the U.S. Bureau of Labour Statistics. 
The first adjustment for inflation takes effect on 1 January 2000, using as reference the period from 1 November 
1997 to 31 October 1999.  All subsequent adjustments shall be calculated using two-years periods, each period beginning November and taking effect in January of the year after. The adjustment formula is described in 
Annex to Article 15-02.7. WT/REG206/3 
Page 34  
 
  construction services by government enterprises a nd autonomous bodies.  Thresholds for purchases by 
state, regional, and municipal government entities shall be reviewed in the framework of future 
negotiations pursuant to Article 15-24. 
99. Tendering procedures are described in Section C.  Either Party may opt for an open, selective 
or limited tender, provided that it responds to th e principle of non-discrimination (Article 15-09).   
Time-limits for tendering and delivery shall be no l ess than 40 days from the date of publication.  
Each Party shall ensure that bid challenge proce dures for procurement covered by the Chapter are fair, 
open, and impartial (Article 15-17).  Article 15-07 prohibits offsets,  while Article 15-08 requires the 
Parties to ensure that their entities do not establish technical qualifications aimed at creating unnecessary barriers to trade.   
100. Article 15-04 requires each Party to accord to goods and goods and ser vices suppliers of the 
other Party treatment no less favourable than that accorded to its own goods and services suppliers 
and to goods and services supp liers of the other Party.
60  Neither Party may discriminate between 
locally established suppliers on the basis of degree of  foreign affiliation or ownership, or discriminate 
on the basis that the goods or services offered by that supplier for the particular procurement are 
goods or services of the other Party. Additionally, neither Party shall establish local presence 
requirements. 
101. Upon notification and consultation, the benefits  of Chapter XV may be denied to a services 
supplier of the other Party when it is determined that the service has been supplied by an enterprise 
that does not have important business operations in any of the Parties' territories and the enterprise is 
owned or controlled by persons of a non-party (Article 15-06). 
102. Exceptions to the Chapter's provisions c oncern the prohibition on the disclosure of 
information considered necessary to protect the Pa rties' essential security and is permitted on the 
grounds of: public security, morals or order;  pr otection of human, animal and plant life and health; 
protection of intellectual property;  or protection of handicapped persons, phila nthropic institutions or 
prison labour (Article 15-18). 
103. The Parties agreed to cooperat e, on mutually agreed terms, to understand their respective 
systems and to ensure better ac cess to government procurement markets for their suppliers 
(Article 15-20).  They also committed to promote public procurement opportunities for micro enterprises, and small and medium-si zed businesses through the work of the ad hoc  committee 
(Article 15-21).  
(c) Intellectual Property Rights 
104. Under Chapter XVII each Party shall grant to nationals of the other Party protection of 
intellectual property rights (IPRs) in its territory and shall ensure that measures to protect IPRs do not 
                                                     
 
60 National treatment and non-discrimination principles do not apply to measures on customs duties or 
other charges of any kind imposed on or in connection with the method of levying such duties or charges, nor to 
import regulations including imports restrictions and formalities (Article 15-04.3).  WT/REG206/3 
 Page 35 
 
 
  constitute unnecessary barriers to trade (Article 17-02).61  The Parties commit themselves to 
implement all international conventi ons on IPRs listed in Article 17-03.62  
105. IPRs covered under the Treaty are:  trademar ks and well-know trademarks;  geographical 
indications and appellations of orig in;  and copyrights and related rights.  Protection of undisclosed 
information and programme-carrying satellite si gnals are also addressed.  National and MFN 
treatment are granted to nationals of the Parties (Articles 17-04 and 17-06).  
106. Under Article 17-32 the Parties shall pr ovide technical cooperation to facilitate 
implementation of the Chapter's provisions. In pa rticular, Mexico, in coordination with other 
international cooperation programm es, shall provide technical assi stance to Nicaragua upon request 
and on mutually agreed terms and conditions.  Fi nancial commitments are excluded under the Treaty. 
IV. PROVISIONS AFFECTING TRADE IN GOODS 
A. SECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  
1. Agricultural products 
107. Chapter IV contains specific provisions on trad e in agricultural products (WTO definition).63  
In order to facilitate market access in their respec tive territories, the Parties waive their rights under 
Article XI:2(c) of GATT 1994, as incorporated in Ar ticle 3-09 of the Treaty, with respect to any 
measures adopted or maintained by a Party on im ports of agricultural goods (Article 4-04.2).  
Nevertheless, some products are excluded from liber alization (marked as "E XCL" in the Parties' 
tariffs schedules and shown in Annex III to this presentation) and remain subject to customs duties, in 
accordance with the Parties' rights and obligation under the WTO Agreement (Article 4-04.3).  As 
from the entry into force of the Treaty, the Par ties shall annually review within the Committee on 
Agricultural Trade the possibility of graduall y eliminating customs duties on these products 
(Article 4-04.4).  To date, the Pa rties have not agreed on any further liberalization of agricultural 
products.  
108. With regard to sugar products, the Treaty prov ides for flexible TRQs in accordance with the 
provisions of Annex 2 to Article 4-04 (See Section on TRQs of this presentation).  
109. Article 4-04.7 prohibits, upon entry into force of  the Treaty, refunds of customs duties paid, 
or waivers and reductions of customs duties owed, on any agricultural imports by the Parties that is 
substituted by an identical or similar good that is sub sequently exported to the other Party or used in 
the production of a good subsequently exported to the other Party.  
110. Article 4-05 does not prevent the Parties from adopting domestic support measures which are 
recognized to be of crucial importance for the ag ricultural sector.  However, the measures must not 
                                                      
61 Article 17-01 defines "nationals of the other Party" as persons that fulfil eligibility requirements for 
protection pursuant to the Berne Convention for the Pr otection of Literary and Artistic Works (1971); the 
Geneva Convention for the Protection of Producers of Phonograms 
against Unauthorized Duplication of  their Phonograms (1971);  the Rome Convention for the Protection of 
Performers, Producers of Phonograms and Broadcasting Organizations (1961);  and the Paris Convention for the Protection of Industrial Property (1967). 
62 Nicaragua became a member of the Rome Convention and the Geneva Convention on 10 August 
2000, and of the Berne Convention on 23 August 2000. 
63 Article 4-01 defines agricultural products as pr oducts in HS Chapters 1-24, products listed in 
Paragraph (b), and fisheries produ cts as specified in the Treaty. WT/REG206/3 
Page 36  
 
  distort or result in minimal distortions to trade or production or must be exempt from any reduction 
commitments negotiated by the Parties in the WTO.
64 
111. The Parties endeavour to eliminate export subsid ies on agricultural products in their bilateral 
and multilateral trade relations (Article 4-06).  From  the Treaty's entry into force, neither Party may 
increase subsidies above 7% of the f.o.b export valu e of a product.  In addition, export subsidies 
cannot be used in bilateral trade once tariffs on ag ricultural products are eliminated under the Treaty, 
and no later than 1.7.2007.65 
112. The Committee on Agricultural Trade shall, inter alia , analyse possible mechanisms for 
including in the TRP those products corresponding to HS lines 0901.21, 0901.22, and 0901.90 (roasted coffee), and shall present them to the Co mmission for consideration (Article 4-08).  A 
Committee on Agricultural Grading and Marketing St andards was also set up to review agricultural 
grading and quality standards affecting trade between  the Parties and resolve issues that may arise on 
the operation of those standards (Article 4-07).  Ar ticle 4-07.3 requires the Parties to grant to each 
other national treatment to agricultural imports wh en applying standards for packaging, grading, 
quality and size.  
V. GENERAL PROVISIONS OF THE AGREEMENT   
1. Transparency 
113. The Parties must establish at least one contact poi nt in their respective territories to facilitate 
communications (Article 18-01) and ensure the pub lication of all laws, re gulations, procedures and 
administrative rulings of general application (Article  18-02).  Each Party shall also notify and provide 
information to the other Party, to the extent possible, of any proposed or actual measure that may 
affect or substantially affect the other Party's interests (Article 18-03).   
2. Current payments and capital movements 
114. All transfers related to an investment of an i nvestor of a Party in the territory of the other 
Party are to be made freely a nd without delay (Article 13-17).
66  However, a Party may prevent a 
transfer through the equitable, non-discriminatory and good faith application of its laws in the 
following cases:  bankruptcy, insolven cy or the protection of creditors  rights;  issuing, trading or 
dealing in securities;  criminal or administrative o ffences;  reports of transfers of currency or other 
monetary instruments, as required by the moneta ry authorities of the Parties;  compliance with 
judgments in adjudication proceedings;  or the est ablishment of instruments or mechanisms for the 
payment of income taxes, in relation to divide nds and other items, such as withholding taxes. 
3. Exceptions 
115. The Treaty has incorporated Article XX of GATT 1994 and its interpretative notes with 
respect to Part Two (trade in goods), except provi sions applying to services and investments, and Part 
Four (technical barriers to trade), except provisions applying to services.  The Parties shall adopt or 
                                                      
64 Nicaragua notified the WTO of the application of domestic support measures. See documents 
G/AG/N/NIC/7;  G/AG/N/NIC/11;  G/AG/N/NIC/16;  G/AG/N/NIC/16/Rev.1).  Mexico did not provide any 
information. 
65 Nicaragua confirmed that it does not apply expo rt subsidies on agricultural products under the 
Treaty.  Mexico did not provide any information. 
66 Such transfers are:  profits, di vidends, interest, capital gains, royalties, management fees, technical 
assistance and other fees, returns in kind and other amounts from the investment;  proceeds from the sale of all or any part of the investment;  payments made under a contract by the investor, or investment thereof;  and 
payments from compensation for expropriation pursuant to Ar ticle 16-09 or from a dispute under Article 13-20.    WT/REG206/3 
 Page 37 
 
 
  implement exceptions to provisions of Part Four , Chapter X (trade in services), and Chapter XI 
(telecommunications), unless they contain provisions on trade in goods, that are necessary to:  protect 
public morals and human, animal or plant life or  health;  maintain public order;  and secure 
compliance with laws or regulations which are not inconsistent with the Treaty's provisions.  These 
also include measures for the prevention of deceptiv e and fraudulent practices;  for the protection of 
individuals' privacy;  and for safety, provided they are not applied in a manner that would constitute a 
means of arbitrary or unjustifiable discrimination or a disguised restriction on trade between the 
Parties (Article 21-01). 
116. National security exceptions are addressed in Article 21-02, while Article 21-03 provides for 
exceptions to the disclosure of information. 
4. Accession and withdrawal 
117. Any country or group of countries may accede to the Treaty under the terms and conditions 
agreed between the applying country or group of  countries and the Administrative Commission and 
following completion of the approval procedures in each country (Article 22-05).  The Treaty applies 
between either Party and the acceding country or grou p of countries if, at the time of accession, they 
consent to such application.  Accession shall take e ffect upon exchange of written notifications on the 
completion of necessary legal procedures. 
118. Under Article 22-06, either Party may withdr aw from the Treaty 180 days after having 
notified the other Parties, unless otherwise agreed. 
5. Institutional framework 
119. The Administrative Commission of the Treaty was established to:  supervise the compliance 
and proper implementation of the Treaty and evaluate the results;  resolve any disputes on the Treaty's 
interpretation or application; a nd supervise the work of all the other committees (Article 19-01.2).67 
The Administrative Commission is composed of the Mi nister of Trade and Industrial Development or 
its successor, for Mexico, and the Minister of Ec onomic Affairs and Development or its successor, for 
Nicaragua (Annex 19-01).  It shall convene at least once a year and shall be chaired alternately by 
each Party.  All decisions of the Commission shall be taken by mutual agreement.68  Since the entry 
into force of the Treaty, the Administrative Comm ission established, by decision:  the Administrative 
Subcommittee;  and the Committees on Trade in  Goods, on Services and Investment and on 
Government Procurement. 
120. The Parties have also established the national sec tions of the Secretariat in their respective 
territories to: assist the Commission;  provide admini strative assistance to arbitral panels;  support the 
work of the committees and subcommittees;  be res ponsible for the remuneration of panellists and 
experts appointed under the Treaty;  and carry out any other functions mandated by the Commission.69 
                                                      
67 The other committees are on Agri cultural Trade;  Sanitary and Phytosanitary Measures;  Rules of 
Origin;  Customs Procedures;  Temporary Imports;  Fina ncial Services;  Standards-Related Measures; and on 
Micro-enterprises, and Small and Medium-sized Businesses.   The Subcommittees are for:  Health Standards;  
Labelling, Packaging and Packing Standards;  an d Telecommunications Standards (Annex 19-01.2). 
68 The decisions of the Administrativ e Commission are available at:  
http://www.sice.oa s.org/TPD/MEX_NIC/MEX_NIC_s.asp  
69 The National Section was established pursuant to Decision No 8 of the Administrative Commission, 
dated 27 June 2007.  For Mexico, this is the Mexican Sec tion of the Secretariat of th e Treaties of Free Trade, or 
its successor;  for Nicaragua, this is the Directorate for the Application of Treaties of the General Directorate of 
External Trade. Source: http://www.sice.oas.org/TPD/ MEX_NIC/Decisions/Dec8_s.pdf  WT/REG206/3 
Page 38  
 
  6. Dispute settlement 
121. The Parties shall endeavour to resolve any disput e on the interpretation or application of the 
Treaty through cooperation and consultation to reach a mutually agreed solution (Article 20-01).  The 
Chapter applies to: (i) the prevention or resolu tion of any dispute between the Parties on the 
application or interpretation of the Treaty;  and ( ii) any measures, existing or proposed, that a Party 
considers to be incompatible with the Treaty a nd that may cause nullification or impairment, in 
accordance with Annex 20-02 (Article 20-02).   
122. Disputes can be resolved either through the mechanism under the Treaty or the WTO Dispute 
Settlement Body;  once the forum has been selected, it shall be used to the exclusion of the other 
(Article 20-03).  Consultations sha ll be held upon a written request by either Party (Article 20-05).  If 
after 45 days from the beginning of consultations th e matter has not been resolved, either Party may 
request, in writing, a meeting of the Commission (Article 20-06).  The Commission shall convene within ten days from the request, and may:  (i) ca ll on technical advisers or create groups of experts, 
where necessary;  (ii) have recourse to good offi ces, conciliation, or mediation;  or (iii) make 
recommendations.  In the absence of a resolution within 45 days from the Commission's meeting, 
either Party may request in writing the establis hment of an arbitral panel (Article 20-07). 
123. The arbitral panel consists of five members sel ected from a roster of up to 20 individuals with 
expertise or experience in matters c overed by the Treaty (Article 20-08).
70  The list of panellists was 
decided by the Administrative Commission in its Decision N.11 of 27 June 2007.71  The Parties are to 
agree on the president of the panel within 15 days from the submission of the request;  in the absence 
of an agreement, one of the Parties, chosen by lo t, shall select the president within five days.  The 
president must not be a citizen of the selecting Party.  Within 15 days from the selection of the 
president, each Party is to choose two panellists, who mu st be citizens of the Parties;  if they do not 
agree, the panellists will be chosen by lot from th e roster (Article 20-10).  The panel's rules of 
procedure were established by Decision N.9 of th e Administrative Commission, dated 27 June 2007.72 
124. The preliminary determination shall be issued 90 days after the last panellist has been selected 
and the Parties have 14 days to submit written comme nts to the panel (Article 20-13).  After 30 days 
from the issuance of the preliminary determination, the panel shall submit to the Commission its final 
determination, adopted by majority, and sha ll publish it within 15 days from its submission 
(Article 20-14).  The final determ ination is binding on the Parties.  Where the measure is declared 
incompatible with the Treaty's provisions, the Part y complained against shall not implement or shall 
revoke the measure;  if the measure causes nullifica tion or impairment, the panel shall determine the 
level of nullification or impairment and suggest  a mutually satisfactory adjustment between the 
Parties (Article 20-15).  Where the Party compla ined against fails to comply with the final 
determination within the period established by the pa nel, or if the Parties do not agree on a mutually 
satisfactory solution in case of nullification or im pairment, the complaining Party may suspend the 
benefits under the Treaty.  Benefits can remain suspended while the Party complained against does 
not conform with the final determination or until th e Parties agree on a mutually satisfactory solution. 
The suspension shall concern the same sector or sector s being affected by the measure.  Either Party 
may also request the Commission to establish an ar bitral panel to determine whether the level of 
benefits suspended is excessive;  the panel's determination shall be made within 60 from its 
establishment (Article 20-16).   
                                                      
70 The Administrative Commission agreed on a "Code of conduct" for panellists, by Decision N.10 of 
26 June 2007.Source:  http://www.sice.oas.org/TPD/ME X_NIC/Decisions/Dec10_s.pdf  
71 Source: http://www.sice.oas.org/TPD/ME X_NIC/Decisions/Dec11_s.pdf  
72 Source: http://www.sice.oas.org/TPD/ MEX_NIC/Decisions/Dec9_s.pdf   WT/REG206/3 
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  125. Where an issue of interpretation or application of the Treaty arises in any domestic judicial or 
administrative proceeding of a Party and the other Part y believes it would merit its intervention, or if a 
court or an administrative body of a Party solicits th e views of the other Party, that Party shall notify 
and provide information as soon as possible to the Party and its Section of the Secretariat (Article 20-17).   
7. Relationship with other Agreements concluded by the Parties 
126. Under Article 1-03, the Parties reaffirm their rights and obligations under the WTO 
Agreement and other agreements to which they are pa rty.  In the event on inconsistency between these 
agreements and the Treaty, the latter shall prev ail to the extent of the inconsistency.  
127. All RTAs to which Mexico and Nicaragua are pa rty and which are in force (both notified and 
non-notified) as of August 2010 are listed in Table V.1 below. WT/REG206/3 
Page 40  
 
  Table V.1 
Mexico and Nicaragua:  Participation in other RTAs (n otified and non-notified in force), as of August 2010  
GATT/WTO Notification Partner/ 
AGREEMENT  Date of 
entry into 
force Type of 
Agreement Year WTO Provision 
MEXICO 
Japan 01.04.05 Goods & Services 2005 GATT Art. XXIV & GATS Art. V 
EFTA 01.07.01 Goods & Services 2001 GATT Art. XXIV & GATS Art. V 
Honduras (Northern Triangle) 01.06.01 Goods & Se rvices 2006 GATT Art. XXIV & GATS Art. V 
Guatemala (Northern Triangle) 15.03.01 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
El Salvador (Northern Triangle) 15.05.01 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
EC 01.10.00 Services 2002 GATS Art. V 
 01.07.00 Goods 2000 GATT Art. XXIV 
Israel 01.07.00 Goods 2001 GATT Art. XXIV 
Chile 01.08.99 Goods & Services 2001 GATT Art. XXIV & GATS Art. V 
Costa Rica 01.01.95 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
NAFTA 01.01.94 Goods & Services 1993 GATT Art. XXIV & GATS Art. V 
GSTP 19.04.89 Goods 1989 Enabling Clause 
LAIA 18.03.81 Goods 1982 Enabling Clause 
PTN 11.02.73 Goods 1971 Enabling Clause 
Bolivia 07.01.10 Goods & Services Not notified 
MERCOSUR 05.01.06 Goods Not notified 
Uruguay 15.07.04 Goods & Services Not notified 
Brazil 02.05.03 Goods Not notified  
G3 01.01.95 Goods & Services Not notified 
Argentina 01.01.87 Goods Not notified 
Panama 24.04.86 Goods Not notified 
NICARAGUA  
     
The Separate Customs Territory of Taiwan, 
Penghu, Kinmen and Matsu 01.01.08 Goods & Services 2009 GATT Art. XXIV & GATS Art. V 
CAFTA-DR 01.03.06 Goods & Services 2006 GATT Art. XXIV & GATS Art. V 
GSTP 19.04.89 Goods 1989 Enabling Clause 
CACM 12.10.61 Goods 1961 GATT Art. XXIV 
Panama (Central America) 21.11.09 Goods & Services Not notified 
Dominican Republic (Central America) 03.09.02 Goods & Services Not notified 
CACM 06.01.06 Services Not notified 
Venezuela 18.01.74 Goods Not notified 
 
Source: WTO Secretariat.  
 
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 NEGOTIATIONS AMONG DEVELOPING COUNTRIES. G3:  Group of Three, Colombia, Mexico and Venezuela.  Venezuela withdrew from the Agreement on 19 November 2006 
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. 
  WT/REG206/3 
 Page 41 
 
 
  ANNEX I 
 
Details of tariff liberalization under the Treaty  
  
1. A comparison between the MFN and preferential rates applied by Mexico and Nicaragua to 
their mutual imports over the implementation period  is shown in Tables AI.1 (Mexico) and AI.2 
(Nicaragua), by total products, agricultural produc ts (WTO definition), and non-agricultural products. 
2. Mexico's duty-free lines in the year before the entry into force of the Treaty (1997) accounted 
for 14.1% of the total;  the average applied MFN rate was 13.3%, with the average tariff on 
agricultural products (20.4%) considerably higher than for non-agricultural products (12.6%).  Upon 
entry into force of the Treaty (1998), Nicaragua's e xporters enjoyed an absolute margin of preference 
on agricultural goods of 7.1%  vis-à-vis  the prevailing average MFN tariff in 1997;  on 
non-agricultural goods, this margin was higher (11.6%) since the average tariff applied by Mexico on 
such products fell from 12.6% to 1%.  The share of  duty-free lines in the agricultural sector increased 
from 11.5% to 39.4%;  more significantly, the shar e of duty-free lines in the non-agricultural sector 
grew from 14.3% to 76.5%.  The corresponding figur es in 2007 (the tenth year of implementation) 
were an average applied tariff of 1.1% on agricu ltural products and zero for non-agricultural products.  
At the end of the transition period, in 2012, 99.8% of Mexico's tariff lines are to become duty-free, 
including 97.5% of agricultural lines and 100% of non-agricultural lines.  Under the Treaty, Mexico 
continues to apply an average duty of 0.9% on agricultural products imported from Nicaragua. 
Table AI.1 
Mexico:  Indicators of MFN tariff rates and preferential rates for imports from Nicaragua 
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 1997b 13.3 15.5 14.1 20.4 23.1 11.5 12.6 14.7 14.3 
 2009 9.7 12.5 22.4 20.7 24.4 14.8 8.5 11.1 23.2 
Nicaragua 1998 2.2 8.1 73.0 13.3 22.2 39.4 1.0 4.4 76.5 
 1999 1.8 6.9 73.0 11.6 19.3 39.4 0.8 3.6 76.5 
 2000 1.5 5.6 73.0 9.8 16.3 39.4 0.7 2.8 76.5 
 2001 1.2 4.4 73.0 8.1 13.4 39.4 0.5 2.0 76.5 
 2002 0.9 6.7 86.8 6.8 18.7 62.9 0.3 2.6 89.3 
 2003 0.7 5.6 86.8 5.7 15.6 62.9 0.2 2.1 89.3 
 2004 0.6 4.4 86.8 4.5 12.4 62.9 0.2 1.6 89.3 
 2005 0.4 3.2 86.8 3.4 9.2 62.9 0.1 1.1 89.3 
 2006 0.3 2.0 86.8 2.2 6.1 62.9 0.1 0.6 89.3 
 2007 0.1 21.1 99.4 1.1 60.1 97.0 0.0 1.6 99.6 
 2008 0.1 20.3 99.4 1.1 58.4 97.0 0.0 1.3 99.6 
 2009 0.1 19.6 99.4 1.0 56.8 97.0 0.0 1.0 99.6 
 2010 0.1 18.8 99.4 1.0 55.1 97.0 0.0 0.6 99.6 
 2011 0.1 18.0 99.4 1.0 53.5 97.0 0.0 0.3 99.6 
 2012 0.1 70.3 99.8 0.9 70.3 97.5 0.0 0.0 100.0 
 
a WTO Definition.   
b MFN rate at 18 December 1997. 
 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 1996 nomenclature. 
 
Source : WTO Secretariat estimates based on data provided by Mexico. 
 
 WT/REG206/3 
Page 42  
 
  3. Nicaragua's duty-free lines in the year before the entry into force of the Treaty (1998) 
accounted for 45.8% of the total;  the average app lied MFN rate was 6.5%.  The average tariff on 
agricultural products (11.2%) was twice that on non-agricultural products (5.6%).  Upon entry into force of the Treaty (1998), Mexican exporters enjoye d an absolute margin of preference of 2.4% on 
agricultural goods and of 1.1% on non-agricultural goods vis-à-vis  the prevailing MFN tariffs.  The 
share of duty-free lines increased from 18.8% to 36.9% in the agricultural sector, and from 51% to 
62.1% in the non-agricultural sector.  After ten years of implementation, the average applied tariff fell 
to 0.6% on agricultural products and to zero on non-ag ricultural products.  At the end of the transition 
period, in 2012, 99.6% of Nicaragua's tariff lin es are to become duty-free, including 97.1% of 
agricultural lines and 100% of non-agricultural lines.  Under the Treaty, Nicaragua continues to apply 
an average duty of 0.5% on agricultural products imported from Mexico. 
Table AI.2 
Nicaragua:  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 1998 6.5 11.9 45.8 11.2 13.8 18.8 5.6 11.4 51.0 
 2009 6.0 11.4 47.6 11.5 15.1 23.9 5.0 10.4 51.6 
Mexico 1998 5.2 12.3 58.0 8.8 14.0 36.9 4.5 11.9 62.1 
 1999 4.4 10.4 58.0 7.5 11.8 36.9 3.8 10.0 62.1 
 2000 2.6 6.3 58.0 5.3 8.4 36.9 2.1 5.6 62.1 
 2001 1.9 4.5 58.0 4.1 6.5 36.9 1.5 3.9 62.1 
 2002 1.2 6.2 81.4 3.0 8.4 64.2 0.8 5.3 84.8 
 2003 1.0 5.2 81.4 2.6 7.3 64.2 0.7 4.3 84.8 
 2004 0.8 4.1 81.4 2.2 6.3 64.2 0.5 3.2 84.8 
 2005 0.6 3.1 81.4 1.8 5.1 64.2 0.3 2.2 84.8 
 2006 0.4 2.0 81.4 1.4 3.8 64.2 0.2 1.2 84.8 
 2007 0.1 9.9 98.8 0.6 17.2 96.4 0.0 3.1 99.3 
 2008 0.1 9.5 98.8 0.6 17.0 96.4 0.0 2.5 99.3 
 2009 0.1 9.1 98.8 0.6 16.8 96.4 0.0 1.8 99.3 
 2010 0.1 8.7 98.8 0.6 16.6 96.4 0.0 1.2 99.3 
 2011 0.1 8.2 98.8 0.6 16.3 96.4 0.0 0.6 99.3 
 2012 0.1 18.8 99.6 0.5 18.8 97.1 0.0 0.0 100.0 
 
a WTO Definition. 
 
Note: Excludes data beyond HS Chapter 97.  
Based on the HS 1996 nomenclature. 
 
Source : WTO Secretariat estimates based on data provided by Nicaragua. 
 
4. Table AI.3.A shows market access conditions in  Mexico for Nicaragua's top 25 exports 
(aggregated at the HS 6-digit level), which repr esented 43.9% of its globa l exports during 1995-1997.1  
Before the entry into force of the Treaty, seven tariff lines were duty-free on an MFN basis and 73 
were dutiable.  In 1998, an add itional 52 lines became duty-free for exports from Nicaragua;  half of 
them related to other instruments and appliances (HS 901890 ) and static converters (HS 850440), 
which accounted for only 3% of Nicaragua's total expor ts.  Almost half of Nicaragua's most exported 
products to Mexico (19.9%) cons isted of non-decaffeinated roasted coffee (HS 090111) which does 
not benefit from preferential treatment under the Treaty, since it remains subject to a duty of 20%.  A part from coffee, other tariff lines that remain dutiabl e at the end of the implementation period relate 
to sugar products, subject to TRQs, and to bananas.  
 
 
                                                     
 
1 Nicaragua informed the Secretariat that ribbons (HS 961812) and magnetic discs (HS 852320) are not 
produced in Nicaragua.  WT/REG206/3 
 Page 43 
 
 
  Table AI.3.A:  Mexico: Market ac cess opportunities under the Treaty for  Nicaragua's top 25 exports 
Access Conditions to Mexico's import markets  
MFN (1997) a Nicaragua's top export products in 1995-1997  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 
1998 
2002 
2007 
Remain Dutiable  
090111 Not decaffeinated 19.9 20.0  1    1 
961210 Ribbons 5.9 13.3  3 3    
170111 Cane sugar 5.4 0.39586$/
Kg  2    2 
030613 Shrimps and prawns 5.1 20.0  1  1   
900990 Parts and accessories 4.8 10.0  3 3    
030611 Rock lobster and other sea crawfish 
(palinurus spp., panulirus spp., jasus spp.) 4.6 20.0  1 1    
852320 Magnetic discs 3.7 15.0  1 1    
711319 Of other precious metal,  whether or not plated 
or clad with precious metal 3.4 10.0 1 2  2   
020230 Boneless 3.1 25.0  1   1  
020130 Boneless 3.1 20.0  1   1  
080300 Bananas, including plantains, fresh or dried 2.9 20.0  1    1 
240210 Cigars, cheroots and cigarillos, containing 
tobacco 2.3 45.0  1   1  
120220 Shelled, whether or not broken 2.1 0.0 1      
850440 Static converters 2.1 15.0  15 15    
120740 Sesamum seeds 2.0 0.0 1      
710812 Other unwrought forms 1.4 0.0 1      
071332 Small red (adzuki) bean s (phaseolus or vigna 
angularis) 1.2 10.0  1   1  
020110 Carcasses and half-carcasses 1.2 20.0  1   1  
040610 Fresh (unripened or uncured) cheese, 
including whey cheese, and curd 1.2 125.0  1   1  
160413 Sardines, sardinella and brisling or sprats 0.9 20.0  2   2  
440710 Coniferous 0.9 12.5  4   4  
901890 Other instruments and appliances 0.9 12.4 1 26 26    
030623 Shrimps and prawns 0.9 10.0 1 1  1   
030269 Other 0.9 15.0  2 1  1  
520100 Cotton, not carded or combed 0.8 6.7 1 2 2    
 Total of above  43.9  7 73 52 4 13 4 
 
a MFN rate at 18 December 1997.   
Note: Based on the HS 1996 nomenclature. 
 
Source : WTO estimates based on data provided by  Mexico and UNSD, Comtrade database. 
 
 
5. After ten years of implementation, the share of Nicaragua's top 25 exports to Mexico 
increased to 75.2% of its global exports during 2005- 2007 (Table AI.3.B).  The most of liberalization 
occurred in 2007, when 18 lines enjoyed duty-free tr eatment; nearly half of them concerned cheese 
products (HS 040690).  Further two lines –milk and cream without added sugar or other sweetening 
matter (HS 040221) shall be liberalized by 2012 .  The four dutiable lines remains unchanged:  
non-decaffeinated coffee, cane sugar – the two most  traded products- and bananas are excluded by 
Mexico from liberalization under the Treaty.  
 
   
 
  WT/REG206/3 
Page 44  
 
  Table AI.3B:  Mexico: Market a ccess opportunities under the Treaty  for  Nicaragua's top 25 exports 
Access Conditions to Mexico's import markets  
MFN (1997) a Nicaragua's top export products in 2005-2007  
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 
1998 
2002 
2007 
2012 
Remain Dutiable  
090111 Not decaffeinated 19.0 20.0  1     1 
170111 Cane sugar 5.6 0.39586$
/Kg  2     2 
020230 Boneless 5.4 25.0  1   1   
030613 Shrimps and prawns 5.0 20.0  1  1    
020130 Boneless 5.0 20.0  1   1   
710812 Other unwrought forms 4.6 0.0 1       
120220 Shelled, whether or not broken 4.1 0.0 1       
030611 Rock lobster and other sea crawfish 
(palinurus spp., panulirus spp., jasus 
spp.) 3.7 20.0  1 1     
010290 Other 2.6 7.5 2 2   2   
071332 Small red (adzuki) beans (phaseolus or 
vigna angularis) 2.0 10.0  1   1   
961210 Ribbons 2.0 13.3  3 3     
080300 Bananas, including plantains, fresh or 
dried 1.9 20.0  1     1 
900990 Parts and accessories 1.6 10.0  3 3     
852320 Magnetic discs 1.4 15.0  1 1     
040690 Other cheese 1.3 68.6  7   7   
240210 Cigars, cheroots and cigarillos, 
containing tobacco 1.2 45.0  1   1   
030269 Other 1.2 15.0  2 1  1   
711319 Of other precious metal, whether or not 
plated or clad with precious metal 1.2 10.0 1 2  2    
120740 Sesamum seeds 1.2 0.0 1       
040221 Not containing a dded sugar or other 
sweetening matter 1.1 69.0  2    2  
020110 Carcasses and half-carcasses 1.1 20.0  1   1   
220210 Waters, including mineral waters and 
aerated waters, containing added sugar or other sweetening matter or flavoured 0.9 20.0  1   1   
220840 Rum and tafia 0.8 20.0  2 2     
271000 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 bitumi 0.8 7.3 3 8  8    
691090 Other 0.7 20.0  2   2   
 Total of above  75.2  9 46 11 11 18 2 4 
 
a MFN rate at 18 December 1997.  
 
Note: Based on the HS 1996 nomenclature.  
Source : WTO estimates based on data provided by  Mexico and UNSD, Comtrade database. 
 
6. Table AI.3.C shows market access conditions in  Nicaragua for Mexico's top 25 exports 
(aggregated at the HS 6-digit level) which, in 1 995-1997, accounted for 42.8% of its global exports.  
Before the entry into force of the Treaty, nine tariff lines were duty-free on an MFN basis and 49 were 
dutiable.  In 1998, only two lines relating to parts (HS 870829) and accessories for motor vehicles (HS 870821) were liberalized.  The bulk of libe ralization occurred in 2002, when 39 lines were 
liberalized;  around half of them we re made of motor cars and vehicles for transporting persons.  After 
ten years of implementation, further four lines enjoyed duty-free treatment:  these concerned electric 
conductors, trousers of cotton, and parts of seats.  The four lines that remain subject to duties under 
the Treaty concern not-decaffeinated coffee (HS 090111).  WT/REG206/3 
 Page 45 
 
 
  Table AI.3.C:  Nicaragua: Market  access opportunities under the Trea ty for  Mexico's top 25 exports 
Access Conditions to Nicaragua's import markets  
MFN (1998)  Mexico's top export products in 1995-1997  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 
1998 
2002 
2007 
Remain Dutiable  
270900 Petroleum oils and oils obtained from 
bituminous minerals, crude 10.0 0.0 1      
870323 Of a cylinder capacity exceeding 1,500 cc but 
not exceeding 3,000 cc 6.2 10.0  12  12   
852812 Colour 2.8 15.0  2  2   
854430 Ignition wiring sets and other wiring sets of a 
kind used in vehicles, aircraft or ships 2.6 5.0  1   1  
840734 Of a cylinder capacity exceeding 1,000 cc 2.2 0.0 1      
870431 G.v.w. not exceeding 5 tonnes 2.2 5.0  4  4   
870324 Of a cylinder capacity exceeding 3,000 cc 1.9 12.5  4  4   
852990 Other 1.3 10.0  2  2   
847130 Portable digital automatic data processing 
machines, weighing not more than 10 kg, 
consisting of at least a central processing unit, a keyboard and a display 1.2 0.0 1      
847330 Parts and accessories of the machines of 
heading no. 84.71 1.1 0.0 1      
870322 Of a cylinder capacity exceeding 1,000 cc but 
not exceeding 1,500 cc 1.1 7.5  8  8   
847160 Input or output units, whether or not 
containing storage units in the same housing 0.9 0.0 1      
854441 Fitted with connector s 0.9 15.0  1   1  
870421 G.v.w. not exceeding 5 tonnes 0.9 5.0  4  4   
870829 Other 0.9 10.0  1 1    
090111 Not decaffeinated 0.8 13.8  4    4 
852721 Combined with sound recording or 
reproducing apparatus 0.8 15.0  2  2   
620342 Of cotton 0.7 15.0  1   1  
853223 Ceramic dielectric, single layer 0.7 0.0 1      
940190 Parts 0.7 5.0  1   1  
070200 Tomatoes, fresh or chilled 0.6 15.0  1  1   
720712 Other, of rectangular (other than square) 
cross-section 0.6 0.0 1      
851719 Other 0.6 0.0 1      
853690 Other apparatus 0.6 0.0 1      
870821 Safety seat belts 0.6 10.0  1 1    
 Total of above  42.8  9 49 2 39 4 4 
 
Note: Based on the HS 1996 nomenclature. 
 
Source : WTO estimates based on data provided by Nicaragua and UNSD, Comtrade database. 
 
7. In 2005-2007, after ten years of implementation, the share of Mexico's top 25 exports to 
Nicaragua slightly increased to 47.9% of its globa l exports (Table AI.3.D).  Most liberalization 
occurred in 2007, when 40 lines enjoyed duty-free treat ment.  These mainly related to motor cars and 
vehicles for transporting persons (HS 870323), prepara tions of petroleum oils and oils obtained from 
bituminous minerals (HS 271000).  The latter were also  the most liberalized products at the end of the 
tenth year of implementation, covering 11 lines over 16.  The number of dutiable lines under the 
Treaty remains unchanged:  however, the four lines do not relate to coffee but to motor cars and 
vehicles for transporting persons of a cylinder capacity between 1,500 cc and 2,500 cc (HS 870332). WT/REG206/3 
Page 46  
 
  Table AI.3.D:  Nicaragua: Market  access opportunities under the Trea ty for Mexico's top 25 exports 
Access Conditions to Nicaragua's import markets  
MFN (1998)  Mexico's top export products in 2005-2007  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 1998 2002 2007 2012  
270900 Petroleum oils and oils obtained from 
bituminous minerals, crude 13.7 0.0 1      
852812 Colour 6.3 15.0  2  2   
870323 Of a cylinder capacity exceeding 
1,500 cc but not exceeding 3,000 cc 5.1 10.0  12  12   
852520 Transmission apparatus incorporating 
reception apparatus 2.5 0.0 1      
854430 Ignition wiring sets and other wiring 
sets of a kind used in vehicles, aircraft 
or ships 2.1 5.0  1   1  
870431 G.v.w. not exceeding 5 tonnes 1.6 5.0  4  4   
271000 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 bitumin 1.4 9.3 1 20  9 11  
870829 Other 1.3 10.0  1 1    
870899 Other 1.3 5.0  1 1    
940190 Parts 1.3 5.0  1   1  
847150 Digital processing units other than 
those of sub-headings 8471.41 and 
8471.49, whether or not containing in the same housing one or two of the 
following types of unit : storage units, 
input units, output units 1.1 0.0 1      
870324 Of a cylinder capacity exceeding 
3,000 cc 1.0 12.5  4  4   
847330 Parts and accessories of the machines 
of heading no. 84.71 1.0 0.0 1      
847160 Input or output units, whether or not 
containing storage units in the same 
housing 0.9 0.0 1      
870421 G.v.w. not exceeding 5 tonnes 0.8 5.0  4  4   
870422 G.v.w. exceeding 5 tonnes but not 
exceeding 20 tonnes 0.8 5.0  2  2   
840734 Of a cylinder capacity exceeding 
1,000 cc 0.7 0.0 1      
853710 For a voltage not exceedi ng 1,000 v 0.7 10.0  1  1   
220300 Beer made from malt 0.7 5.0  2   2  
847180 Other units of automatic data 
processing machines 0.7 0.0 1      
840991 Suitable for use solely or principally 
with spark-ignition internal 
combustion piston engines 0.6 0.0 1      
870332 Of a cylinder capacity exceeding 
1,500 cc but not exceeding 2,500 cc 0.6 10.0  4    4 
901839 Other 0.6 0.0 2      
852990 Other 0.6 10.0  2  2   
620342 Of cotton 0.6 15.0  1   1  
 Total of above  47.9  11 62 2 40 16 4 
 
Note: Based on the HS 1996 nomenclature. 
 
Source : WTO estimates based on data provided by Nicaragua and UNSD, Comtrade database. 
 
 
   WT/REG206/3 
 Page 47 
 
 
  ANNEX II  
 
Exceptions to Articles  3-03 and 3-09  
 
 
1. Table AII.1 below shows the exceptions to natio nal treatment (Article 3.03) and prohibition 
of imports and exports restricti ons (Article 3-09) that the Par ties are allowed to apply under the 
Treaty.  In the case of Mexico, both exceptions apply;  for Nicaragua, the only exception concerns 
Article 3-09. 
Table AII.1 Exceptions to Articles 3-03 and 3-09 applied by the Parties under the Treaty 
Mexico Nicaragua 
1. Article 3-03 (National treat ment) does not apply, until 
1.1.2006, to products covered by the Decree for Development and Modernization of the Automotive Industry ("Decreto para el 
Fomento y Modernización de la Industria Automotriz) of 11 
December 1989, and any renewal or amendment thereof, even if inconsistent with the Treaty. 
 
2.  Article 3-09 (Imports and e xports restrictions) does not apply 
with respect to the following products: 
 
(a) Products classified under headings 63.09 and 63.10 of the Tariff Schedule of the General Import Duty Act (Tarifa de la 
"Ley del Impuesto General de Importación"), based on the HS. 
 (b) Products classified under the following headings, subheadings, or tariff items: 
8413.11  Pumps for dispensing fuel or lubricants, of the type 
used in filling stations, service stations or garages; 8413.40  Concrete pumps; 
8426.12  Mobil lifting frames on tyres and straddle carriers; 
8426.19  Other (transporter cranes , gantry cranes and bridge 
cranes); 
8426.30  Portal or pedestal jib cranes; 
8426.41  Cranes, self-propelled, on tyres; 8426.49  Other cranes, self-propelled; 
8426.91 Cranes designed for mounting on road vehicles; 
8426.99  Other (derrick and work s trucks fitted with a crane); 
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 lifting, handling, loading or unloading 
machinery; 
8429.11  Caterpillar type self-p ropelled bulldozers and angle 
dozers;  8429.19  Other self-propelled bulldozers and angle dozers; 
8429.20  Self-propelled graders and levellers; 
8429.30  Self-propelled scrapers; 8429.40  Self-propelled tamping machines and road rollers; 
8429.51  Front-end shovel loaders, self-propelled; 
8429.52  Machinery with a 360degrees revolving superstructure; 
8429.59  Mechanical shovels and other shovel loaders; 
8430.31  Coal or rock cutters and tunnelling machinery, self-propelled; 
8430.39  Other coal or rock cutters and tunnelling machinery; 
8430.41  Other boring or sinking machinery, self-propelled; 8430.49  Other boring or sinking machinery; 
8430.50  Other moving, grad ing, levelling or tamping 
machinery, self-propelled; 8430.61  Tamping or compacting machinery, not self-
propelled; 
8430.62  Scrapers, not self-propelled; 8430.69  Other moving, grading or levelling machinery, not 
self-propelled; 
8452.10  Sewing machines of the household type; 1. Article 3-09 (Imports and expor ts restrictions) does not apply 
with respect to the following products, based on the Central American Tariff System: 
 
(a) Products described in headings  6309 and 6310 (Textile Articles); 
 
(b) Products described in the following headings, subheadings and 
items: 4004.00.00.00 Waste, parings and scrap of unvulcanized rubber, 
including powders and granules;  
4012.10.00.00 Retreaded pneumatic tyres; 4012.20.00 Used pneumatic tires; 
84.09 Electromechanical domestic appliances with self-contained 
electric motor; 8414.5 Fans; 84.15 Air conditioning machines, comprising a motor-driven fan 
and elements for changing th e temperature and humidity; 
84.18 Refrigerators, freezers and other materials, machines and 
apparatus for the production of cold, electric or other; 
84.50 Washing machines, including machines which both wash and 
dry; 84.70 Calculating machines; accounting machines, postage-franking 
machines, ticket-issuing machines and similar machines, 
incorporating a calculating device; cash registers; 84.71 Automatic data processing machines and units thereof; 
magnetic or optical readers, machin es for transcribing data onto data 
media in coded form; 85.16 Electric water heaters and immersion heaters; electric space 
heating apparatus and floor hea ting apparatus; electrothermic 
hairdressing apparatus; electric fl atirons; other electronic domestic 
appliances; electric heating resistors; 
85.19 Turntables, record players, cassette players and other sound 
reproducing apparatus; 85.21 Video recording or reproducing apparatus; 85.27 Reception apparatus for radi otelephony, radiotelegraphy or 
radio broadcasting; 
85.28 Reception apparatus for television; 87.02 Motor vehicles for the transport of ten or more persons 
including the driver; 
87.03 Motor cars and other motor ve hicles principally designed for 
the transport of persons, (other than those of heading 87.02), 
including station wagons and racing cars; 
87.04 Motor vehicles for the transport of goods. 
87.05 Special purpose motor vehicles, other than those principally 
designed for the transport of persons or goods (for example, wagons, 
service trucks, mobile cranes, fire fighting vehicles, concrete mixers, 
road sweepers, spraying vehicles, mobile workshops, mobile 
radiological units); 
87.06 Chassis fitted with engines, fo r the motor vehicles of headings 
87.01 to 87.05; 
87.07 Bodies (including cabs) for the motor vehicles of headings 
87.01 to 87.05; 
87.11 Motorcycles (including mopeds ) and cycles fitted with an 
auxiliary motor, with or without side-cars; 
90.09 Photocopying apparatus incorpor ating an optical system or of WT/REG206/3 
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  Mexico Nicaragua 
8452.21  Sewing machines, automatic units; 
8452.29 Other sewing machines; 
8452.90 Other parts of sewing machines;  
84.71 Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing 
data onto data media in code d form, and machines for the 
treatment or processing of such data not elsewhere specified; 
8474.20 Crushing or grinding machines for mineral 
substances; 
8474.39  Other mixing or kneading machines for mineral substances; 
8474.80  Machinery for agglomerating, shaping or moulding 
mineral products 8475.10 Machines for assembling electric lamps or tubes, in 
glass envelopes; 
8477.10 Injection-moulding machines, for rubber or plastic industry; 8504.40.12 Power supplies recognizable as designed exclusively 
for the automatic data processing machines of heading 84.71; 
8701.30  Caterpillar tractors; 8701.90  Other tractors suitable for agricultural use; 
8711.10  Motorcycles, side-cars, with reciprocating internal 
combustion piston engine not exceeding 50 cc;  8711.20  Motorcycles, side-cars, with reciprocating internal 
combustion piston engine exceeding 50 cc but not exceeding 
250 cc; 8711.30  Motorcycles, side-cars, with reciprocating internal 
combustion piston engine exceeding 250 cc but not exceeding 
500 cc; 8711.40  Motorcycles, side-cars, with reciprocating internal 
combustion piston engine exceeding 500 cc but not exceeding 
800 cc; 8711.90  Other motorcycles, side-cars, with reciprocating 
engine; 
8712.00  Bicycles and other cycles (including delivery tricycles), not motorized; 
8716.10  Trailers and semi-trailers for housing or camping; 
8716.31  Tanker trailers and tanker semi-trailers; 
8716.39  Other trailers and semi -trailers for the transport of 
goods; 
8716.40  Other trailers and semi-trailers; 
8716.80  Other vehicles not  mechanically propelled. 
 
(c) Products classified under the following headings, 
subheadings, or tariff items: 27.07 Oils and other products from the high temperature 
distillation of coal tar, similar products in which the weight of 
aromatic constituents exceeds that  of non-aromatic constituents; 
27.09 Petroleum oils and oils obtained from bituminous 
minerals, crude; 
27.10 Petroleum oils and oils obtained from bituminous, minerals, other than crude; prepar ations not elsewhere specified 
or included, containing by weight 70 per cent; 
27.11  Petroleum gas and other gaseous hydrocarbons; 27.12  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; 27.13  Petroleum coke, petroleu m bitumen & other residues; 
27.14  Bitumen and asphalt natural; bituminous or oil shale and 
tar sands; asphaltites and asphaltic rocks;  2901.10  Saturated acyclic hydrocarbons. 
 
(d) Products classified under the following headings, subheadings, or tariff items: 
8407.34  Reciprocating piston engines of a kind used for the 
propulsion of vehicles of Chapter 87, of a cylinder capacity exceeding 1,000 cc; 
8701.20  Road tractors for semi-trailers; The contact type and thermo-copying apparatus. 
(c) Products described in the following headings, subheadings and 
items: 
2709.00.00.00 Petroleum oils and oils obtained from bituminous minerals, crude; 
2710.00.10.20 Gasoline with antidetonant; 
2710.00.10.30 Gasoline without antidetonant; 2710.00.10.40 Aviation turbo fuel; 
2710.00.10.50 Aviation gasoline (Av gas); 
2710.00.10.90 Other uses; 2710.00.20. Medium oils; 
2710.00.30.10 Gas oil; 
2710.00.30.20 Fuel oil (Energy); 2710.00.30.30 Fuel oil (other); 
2710.00.30.40 Diesel oil; 
2710.00.30.9 Other uses; 2710.00.90.00 Other; 27.11 Petroleum gases and other gaseous hydrocarbons; 
2714.90.00.00 Other uses (Asphalts); 
 (d) Export of wood products -exclusively the cedro and caoba 
species- classified in the following tariff items: 
4401.10.00.00 Fuel wood; 4401.22.00.00 Non-coniferous-Dry; 
4401.30.00.00 Sawdust and wood waste and scrap; 
4403.10.00.00 Painted; 4403.49.00.00 Other; 
4403.99.00.00 Other; 
4404.20.00.00 Non-coniferous; 4405.00.00.00 Wood wool (excelsior);  
4406.10.00.00 Railway or tramway sleepers; not impregnated; 
4406.90.00.00 Railway or tramway sleepers; other 4407.29.00.00 Other (sawn wood); 
4407.99.00.00 Other (sawn wood); 
4408.39.00.00 Other (veneer sheets); 4408.90.00.00 Other; 4409.20.00.00 Wood, continuously shaped, non-coniferous; 
4410.11.00.00 Boards known as waferboard; 
4411.19.00.00 Fibreboards of wood, other; 4411.21.00.00 Not mechanically worked; 
4411.29.00.00 Other; 
4411.31.00.00 Not mechanically worked;  4411.39.00.00 Other; 
4411.91.00.00 Not mechanically worked;  
4411.99.00.00 Other; 4413.00.00.00 Densified wood, in blocks.   WT/REG206/3 
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  Mexico Nicaragua 
87.02  Motor vehicles for the transport of ten or more persons; 
87.03  Motor cars and other motor vehicles principally designed 
for the transport of persons, (other than those of heading 87.02), 
including station wagons and racing cars; 
87.04 Motor vehicles for the transport of goods; 
8705.20 Mobile dr illing derricks; 
8705.40  Concrete mixers; 87.06 Chassis fitted with engines, for the motor vehicles of 
headings 87.01 to 87.05. 
 (e) Products classified under the following headings, 
subheadings, or tariff items: 
8407.34  Reciprocating piston engines of a kind used for the 
propulsion of vehicles of Chapter 87, of a cylinder capacity 
exceeding 1,000 cc; 
8701.20  Road tractors for semi-trailers; 87.02 Motor vehicles for the transport of ten or more persons; 87.03 Motor cars and other motor vehicles principally designed 
for the transport of persons, (other than those of heading 87.02), 
including station wagons and racing cars; 87.04 Motor vehicles for the transport of goods; 
8705.20  Mobile drilling derricks; 
8705.40 Concrete mixers; 87.06 Chassis fitted with engines, for the motor vehicles of 
headings 87.01 to 87.05. 
 
Source: Annex 3-03 and 3-09 of the Treaty.  WT/REG206/3 
Page 50  
 
  ANNEX III 
 
Products that remain dutiable under the Treaty
 
 
 
1. Tables AIII.1 and AIII.2 present the list of produc ts that remain subject to duties under the 
Treaty and the corresponding tariffs (MFN and prefer ential) applied by Mexico and Nicaragua.   
Table AIII.1 - Mexico's produc t exclusions under the Treaty 
TL  Category  Description MFN 1998 MFN 2009 Preferential 
03019901 PROH Other live fish Prohibited Prohibited Prohibited 
08030001 EXCL Bananas and plantains, fresh or dried 20% 20% 20% 
09011101 EXCL Coffee (not roasted, not decaffeinated) 20% 20% 20% 
09011201 EXCL Coffee (not roasted, decaffeinated) 20% 20% 20% 
09012101 EXCL Coffee (roasted, not decaffeinated) 72% 72% 72% 
09012201 EXCL Coffee (roasted, decaffeinated) 72% 72% 72% 
09019001 EXCL Coffee husks and skins 72% 72% 72% 
09019099 EXCL Other 72% 72% 72% 
12119002 PROH Marihuana ( Cannabis Indica ) Prohibited Prohibited Prohibited 
13021102 PROH Preparations for smoking Prohibited Prohibited Prohibited 
13021902 PROH Of marihuana ( Cannabis Indica ) Prohibited Prohibited Prohibited 
17011101 TA US$0.39586/Kg 0.338 US$/Kg 0.338 US$/Kg 
  Sugar, whose content of sucrose by weight, 
in the dry state, corresponds to a polarimeter 
reading of more than 99.3 degrees and less than 
99.5 degrees    
17011199 TA Other US$0.39586/Kg 0.338 US$/ Kg 0.338 US$/ Kg 
17011201 TA 0.39586$/Kg 0.36 US$/ Kg 0.36 US$/ Kg 
  Sugar, whose content of sucrose by weight, 
in the dry state, corresponds to a polarimeter reading of more than 99.3 degrees and less than 
99.5 degrees    
17011299 TA Other 0.39586$/Kg 0.36 US$/ Kg 0.36 US$/ Kg 
17019101 TA Containing added flavouring or colouri ng matter 0.39586$/Kg 0.36 US$/ Kg 0.36 US$/ Kg 
17019901 TA 0.39586$/Kg 0.36 US$/ Kg 0.36 US$/ Kg 
  Sugar, whose content of sucrose by weight, in the 
dry state, corresponds to a polarimeter reading of more than 99.5 degrees and less than 99.7 degrees    
17019999 TA Other 0.39586$/Kg  
0.36 US$/Kg 0.36 US$/Kg 
17022001 EXCL Sugar and maple 15% 15% 15% 
17023001 EXCL 15% 15% 15% 
  Glucose and glucose sy rup, not containing 
fructose or containing in the dry state less than 20 
per cent by weight of fructose    
17024001 EXCL Glucose 15% 15% 15% 
17024099 EXCL Other 15%+ 
0.39586$/Kg 156% 156% 
17025001 EXCL Chemically pure fructose 15% 210% 210% 
17026001 EXCL 15% 210% 210% 
  Other fructose and fructo se syrup, containing in 
the dry state more than 50 percent by weight of fructose    
17029001 EXCL Sugar syrup blend and invert  sugar 0.39586$/Kg 0.39586US$/Kg 0.39586$/Kg 
17029099 EXCL Other 15% 15% 15% 
18061001 EXCL 0.39586$/Kg 0.36 $/Kg 0.36 $/Kg 
  Chocolate and other food preparations containing 
cocoa, containing 90% or more by weight of 
sugar    
21069005 EXCL Syrups containing flavouring or co louring matter 0.39586$/Kg 0.36 $/Kg 0.36 $/Kg 
 
Source:  WTO-IDB and data provided by Mexico. 
 
2. Of the 28 lines excluded by Mexico, 4 are prohi bited lines (cannabis and some live fish), 
while the others are agricultural goods (bananas a nd coffee) and sugar and sugar-containing products, 
the latter being subject to TRQs (category TA).  WT/REG206/3 
 Page 51 
 
 
  Table AIII.2 Nicaragua's product exclusions under the Treaty 
TL  Category  Description MFN 1998 (%) MFN 2009 (%) 
0803.00.11.00 EXCL Bananas, fresh 15 15 
0803.00.12.00 EXCL Bananas, dried 15 15 
0803.00.20.10 EXCL Platanos, fresh 15 15 
0803.00.20.90 EXCL Platanos, dried 15 15 
0803.00.90.00 EXCL Other 15 15 
0901.11.10.00 EXCL Coffee, beans 10 10 
0901.11.20.00 EXCL Coffee, husks 15 15 
0901.11.30.00 EXCL Raw un-roasted coffee (beans) 15 15 
0901.11.90.00 EXCL Other 15 15 
0901.12.00.00 EXCL D ecaffeinated 15 15 
0901.21.00.10 EXCL Grounded coffee, roasted 15 15 
0901.21.00.90 EXCL Other 15 15 
0901.22.00.00 EXCL D ecaffeinated 15 15 
0901.90.00.00 EXCL Other 15 15 
1701.11.00.10 EXCL Raw sugar not containing added flavouring or 
colouring matter, sugar loaf or "dulce de rapadura"  
55  
55 
1701.11.00.90 EXCL Other  55 55 
1701.12.00.00 EXCL Beet sugar 55 55 
1701.91.00.00 EXCL Containing added flavouring or colouring matter 55 55 
1701.99.00.10 EXCL Cane sugar 55 55 
1701.99.00.90 EXCL Other 55 55 
1702.20.00.00 EXCL Maple sugar and maple syrup 10 10 
1702.30.11.00 EXCL Chemically pure glucose 5 0 
1702.30.12.00 EXCL Glucose syrup 5 0 
1702.30.20.00 EXCL Containing fructose, in the dry state, less than 20 
percent by weight  10 40 
1702.40.00.00 EXCL Glucose and glucose syrup, containing in the dry 
state at least 20 percent but less than 50 percent by 
weight of fructose 10 40 
1702.50.00.00 EXCL Chemically pure fructose 0 40 
1702.60.00.00 EXCL Other fructose and fructose  syrup, containing in the 
dry state more than 50 percen t by weight of fructose 10 40 
1702.90.10.00 EXCL Chemically pure maltose 0 40 
1702.90.20.00 EXCL Other sugars and syrups, except sucrose syrup and 
caramelized 0 40 
1702.90.90.00 EXCL Other 15 40 
1806.10.00.00 EXCL Cocoa powder, containing added sugar or other 
sweetening matter 15 15 
 
Source:  WTO-IDB and data provided by Nicaragua. 
 
3. Nicaragua excluded 31 lines from liberalization under the Treaty.  These lines concern all 
agricultural products, i.e. bananas, coffee, sugar and cocoa.  Such products remain subject to 
MFN duty, which ranges from 5% to 55%, the highest duty being applied to six tariff lines related to 
sugar. 
__________