Product Duty Rates for Korea, Colombia, & Panama FTAs Available
The International Trade Administration, Office of the U.S. Trade Representative, and the Commerce Department all have useful information regarding the free trade agreements with Korea, Colombia, and Panama that are awaiting implementation. ITA has a tool that allows users to search each of the pending FTAs by tariff number to see the resulting duty rates over time for qualifying goods. USTR has information on the pending FTAs by sector, as well as fact sheets, legal texts of the three agreements with duty rates, and the implementing legislation. Commerce also has overviews of each.
On October 21, 2011, the President signed all three FTA implementing bills and since then, officials from the U.S., Korea, Panama, and Colombia have been working on implementation. None of the three FTAs have yet been implemented.
ITA Tariff Tool Has Year-by-Year Duty Rates, Etc. for Each FTA
With the ITA’s FTA Tariff Tool, (http://export.gov/FTA/FTATariffTool/) users can see the current and future tariffs applied to their qualifying products, as well as the year in which those products would become duty-free. As the tariff rates are for qualifying goods, each tariff-specific page includes a link to the rules of origin (such as tariff-shift rules for originating goods) and any product-specific rules of origin.
The database covers both exports and imports under the pending FTAs. For example, U.S.-originating exports of vitamin B12 under the KORUS would become duty-free in the first year, from the current duty of 6.5%; and imports of certain South Korea-originating paints and varnishes would become duty-free in the first year, from a current duty of 3.6%.
Expect to add ag & textile products in coming months. Currently, the database focuses on tariff and trade information for industrial products, with little information on agricultural and textile products. ITA sources state that they expect to add tariff and trade data for agricultural and textile goods to the FTA Tariff Tool within the next couple of months. Once the agricultural and textile goods are added, then the product coverage will be complete (i.e., the tariff tool will cover the entire tariff schedule).
(The site provides the same information for already implemented FTAs. In addition, it has a disclaimer which states that while every effort has been made to ensure accuracy, the actual tariff classification and assessment of duties is up to the customs authorities in the U.S. or the FTA partner countries.)
Many Duty Rates Would Go to Zero Immediately, Others Phase Out over 10 Years
According to Commerce’s overview of each FTA, many duty rates would go to zero immediately with others phasing out over 10 years as follows:
KORUS. Within five years of enactment of the U.S.-South Korea Free Trade Agreement (KORUS), over 95% of bilateral trade in consumer and industrial products would become duty free and most remaining tariffs would be eliminated within 10 years. For agricultural products, KORUS would immediately eliminate or phase out tariffs and quotas on a broad range of products, with almost two-thirds (by value) of Korea’s agriculture imports from the United States becoming duty free upon enactment. KORUS also addresses non-tariff barriers and has provisions on cross-border services, telecommunications, and electronic commerce.
Panama TPA. Under the U.S. Panama Trade Promotion Agreement, over 87% of U.S. exports of consumer and industrial products to Panama will become duty-free immediately, with remaining tariffs phased out over 10 years. U.S. products that will gain immediate duty-free access include information technology equipment, agricultural and construction equipment, aircraft and parts, medical and scientific equipment, environmental products, pharmaceuticals, fertilizers, and agro-chemicals. U.S. agricultural exports will also benefit. Panama will immediately eliminate duties on high-quality beef, frozen turkeys, soybeans, soybean meal, crude soybean and corn oil, almost all fruit and fruit products, wheat, peanuts, whey, cotton, and many processed products.
Colombia TPA. Under the U.S.-Colombia Trade Promotion Agreement, over 80% of U.S. exports of consumer and industrial products to Colombia would become duty free immediately, with remaining tariffs phased out over 10 years. Key U.S. exports would gain immediate duty-free access to Colombia, including almost all products in the agriculture and construction equipment, aircraft and parts, auto parts, fertilizers and agro-chemicals, information technology equipment, medical and scientific equipment, and wood sectors.
