Measures taken against Costa Rica’s Safeguard

Nov 23, 2020


The Executive Management Committee of CAMEX (GECEX) published Resolution No. 20, from November 16, 2020,[1] suspending the concessions assumed by Brazil, as a result of the General Agreement on Tariffs and Trade of 1994, in relation to Costa Rica, and establishing an additional percentage to the Import Tax currently in force for products classified under the following NCMs 0510.00.90, 1806.90.00, 2101.20.10, and 2103.90.21.[2]

The measure was adopted in response to the safeguards applied by Costa Rica on August 18, 2020, through Resolution DM-073-2020-MEIC,[3] against imports of solid, granular sugar, known as white sugar, used for both domestic consumption (commercial) and industrial consumption.

The additional percentage adopted by the Brazilian government establishes an increase of 27.68% to the import tax on these four products from Costa Rica and provides a schedule for a gradual reduction of the additional percentage applied by2023, following the system established in the safeguard measure adopted by Costa Rica.

In a published Joint Statement, the Ministries of Economy, Foreign Affairs, and Agriculture, Livestock and Food Supply[4] explained that the Brazilian Government sought to negotiate an agreement that would avoid restrictions on bilateral trade with Costa Rica, which has not been possible until now. Moreover, according to the Statement, the measure adopted by Costa Rica affects Brazilian exports of $3.7 million dollars per year. The measure adopted by Brazil, on the other hand, has fallen back on exports from Costa Rica in the amount of approximately $950 thousand dollars, which can be withdrawn or complemented, according to the evolution of the negotiations between the two countries.

[1] Available at https://www.in.gov.br/web/dou/-/resolucao-gecex-n-120-de-16-de-novembro-de-2020-288535752

[2] The products affected by the suspension adopted by Brazil are: other animal substances, for the preparation of pharmaceutical products (NCM 0510.00.90); other chocolates and food preparations containing cocoa (NCM 1806.90.00); extracts, essences and concentrates and preparations based on these extracts, essences and concentrates, based on teas (NCM 2101.20.10); and condiments and seasonings, composed, in immediate packages of content less than or equal to 1 kg (NCM 2103.90.21).

[3] Available at http://reventazon.meic.go.cr/informacion/gaceta/2020/agosto/DM-073-2020.pdf

[4] Available at https://www.gov.br/economia/pt-br/canais_atendimento/imprensa/notas-a-imprensa/2020/novembro/medidas-adotadas-no-comercio-com-a-costa-rica