WORLD TRADE  
ORGANIZATION  WT/COMTD/1/Add.15 
24 May 2005 
 (05-2098) 
Committee on Trade and Development  
  
 
SOUTHERN COMMON MARKET (MERCOSUR) 
 
Weighted Average Tariff Rates and Customs Duties Collected
 
 
Addendum  
 
Note by the Secretariat1 
  
1. The terms of reference for the examination of MERCOSUR provide that MERCOSUR will 
be examined " ... in the light of the relevant pr ovisions of the Enabling Clause and of the GATT 1994, 
including Article XXIV ...".
2 
2. In the context of "[t]he evaluation under pa ragraph 5(a) of Article XXIV of the general 
incidence of the duties and other regulations of comme rce applicable before a nd after the formation of 
a customs union", paragraph 2 of the Understanding on the Interpretation of Article XXIV of the 
GATT 1994 (the Understanding) directs the Secretariat to calculate "the weight ed average tariff rates 
and customs duties collected" and elab orates on the approach to be used. 
3. As applied to the case of MERCOSUR, the outcome  of the mandated calc ulations consists of 
two sets of comparable figures: 
• Import-weighted average tariff rates:  one reflecting the pre-cust oms union situation;  
the post-customs union situati on is calculated for 1995 and 2006.3 
 • The corresponding estimated valu es of customs duties collected. 
4. The Committee on Regional Trade Agreements , through its Chairman, has instructed the 
Secretariat to perform those calculations, on the basis of information provided by the parties and 
according to the methodology described below. 
                                                      
1 This note has been prepared under the Secretaria t's own responsibility and without prejudice to the 
positions of Members and to their rights and obligations under the WTO. 
2 See document WT/COMTD/5/Rev.1 of 25 October 1995, and the decision adopted by the General 
Council on 31 January 1995 on the Avoidance of Proce dural and Institutional Duplication, document WT/L/29 
of  7 February 1995, paras. 2-4. 
3 This dual evaluation of the post-customs union situation was agreed in informal consultations that 
followed the last examination meeting of MERCOSUR, held on 1st May 1997 (see paragraph 57 of document 
WT/COMTD/1/Add.12).  
  WT/COMTD/1/Add.15 
Page 2  
 
 Data and methodology used in the calculations
 
5. The following data were used in the calculations: 
(a) Tariff rates, by tariff line, for Argentina, Brazil, Paraguay and Uruguay: 
(i) Pre-customs union situation: 
- Applied rates at 1 January 1994. 
(ii) Post- customs union situation: 
- Applied rates at 1 January 1995. 
- Common external tariff rates agreed in 1999 for the completion of the 
customs union in 2006. 
(b) Average of imports, in value and quantity a nd by tariff line, into each of the four 
parties, from WTO partners for the 1992-94 period.4 
(c) Concordance tables linking 1994 tari ff nomenclature to 1995 tariffs.5 
6. The calculations were done in accordance with "t he methodology used in  the assessment of tariff 
offers in the Uruguay Round" (see paragraph 2 of the Understanding) and the following definitions: 
(a) Average tariff rates:  
(i) Pre-customs union situation :  average of Argentina, Brazil, Paraguay and 
Uruguay's applied tariff rates in 1994, weighted by aggregated 1992-94 import values of the four parties.
4 
(ii) Post-customs union situation:   average of Argentina, Brazil, Paraguay and 
Uruguay's applied tariff rates in 1995, weighted by aggregated 1992-94 import values of the four parties.
4 
(iii) Post-customs union situation:   average of Argentina, Brazil, Paraguay and 
Uruguay's applied tariff rates in 2006, weighted by aggregated 1992-94 import values of the four parties.
4 
In instances where it was not possible to establish a unique relationship between 1994 and 
1995 tariff lines (which applied only in the case of Uruguay and Brazil), two tariff values were 
calculated for each subheading with unmatched tariff lines.6  
                                                      
4 For Uruguay the years 1993-1994 are used. 
5 The implementation of the customs union in 1995 resulted in many changes vis-à-vis  the parties' 1994 
tariff nomenclature, e.g. Argentina moved from a 9-digit tariff nomenclature to 8-digits, Brazil moved from 10 
digits to 8 digits and Paraguay increased from an almost 6 digits-only nomenclature to 8 digits.  Correlation 
tables were provided by Argentina and Brazil to track their respective changes.  No table was required for 
Paraguay given the kind of changes made. 
6 These calculations consisted of the average an d the maximum value of the corresponding 1995 
subheading, respectively, which were th en weighted with the trade value of the unmatched 1994 tariff line.  The 
calculation using maxima values represents the hypotheti cal upper limit that a trad e weighted tariff average 
could possibly attain.  WT/COMTD/1/Add.15 
 Page 3 
 
 
 (b) Customs duties collected :  estimates derived from the average tariff rates obtained 
under (a) and annual average import values in 1992-94. 
Results of the calculations  
7. Major parameters underlying the results are shown below: 
National 
weighted average 
tariff rates** Average customs duties collected in 
1992-1994*** 
Post-CU 
(1995) CET 2006 Post CU 
(1995) CET (2006)  Average 
imports 
1992-
94* 
($ m ) Pre-
CU 
Max. Avg. Max. Avg. Pre-
CU 
Max. Avg. Max. Avg. 
Argentina 12,886 9.8 11.2 11.2 12.4 12.4 1,260 1,437 1,437 1600 1,600 
Brazil 22,900 14.5 13.0 12.5 9.2 8.8 3,310 2,967 2,863 2,108 2,025 
Paraguay 929 8.8 10.7 10.7 15.3 15.3 82 99 99 142 142 
Uruguay 1,305 8.9 13.2 11.2 15.0 13.6 116 173 146 195 178 
*    Total imports (incl. petroleum), annual averages.  (See paragraph 4(b) above.) 
**   Based on rates described in paragraph 4(a) above and 1992-94 import weights. 
***  Annual averages.  Estimated on the basis of 1992-94 import values and average tariff rates. 
 
8. The mandated calculations for the MERCOSUR Cu stoms Union, according to the described 
methodology and on the basis of available data, brought out the following results: 
 Pre-Customs 
Union 1995 applied tariff 
rates CET 2006 
Weighted average tariff rates (%) 12.5 12.0 10.4 
Average customs duties collected 
(million USD) 4,768 4,545 3,945 
 
 
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