CARICOM/DOMINICAN REPUBLIC FREE TRADE AGREEMENT
Under the CARICOM/Dominican Republic Free Trade Agreement all goods except three (3) lists of products are eligible for Duty Free Entry when traded between the More Developed Countries (MDCs) and the Dominican Republic. Special provisions have been made for the Less Developed Countries (LDCs), which will not be required to grant duty free access to goods from the Dominican Republic until 2005.
The exception lists to the Agreement mentioned above are as follows:
- Goods which shall be subject to phased reduction of Most Favoured Nation (MFN) rate of duty;
CARICOM has proposed that these goods should be subject to a phased reduction of duty over a three-year period except for rum, which would be phased over a five-year period.
The phasing period would begin December 1, 2002 with a reduction of 33% of the MFN duty, these goods will therefore become duty free on December 1, and 2004.For rum the reduction would begin with a 20% reduction and would become duty free on December 1, 2006. (Until both Parties have agreed, the goods will be subject to the Most Favoured Nation (MFN) rate of duty).
- Goods which shall be subject to Most Favoured Nation (MFN) rate of duty;
These goods are subject to the MFN rate of duty and are not eligible for duty free treatment.
- List of selected agricultural products which shall be subject to Special Trade Arrangements;
These goods are subject to special arrangements, which would allow the MFN rate of duty to apply in times of glut. (The Parties have not yet agreed to these arrangements, the goods will therefore be subject to MFN rate of duty).
Certification of E xports
All goods that are eligible for duty free preference must comply with the qualifying criteria and be certified by the designated Governmental Authority.(Trade Board Limited in Jamaica)
Qualifying Criteria
- Wholly Produced; goods must either be grown within CARICOM or the Dominican Republic or manufactured from raw materials originating in CARICOM or the Dominican Republic
- Change of Tariff Heading; raw material originating outside of CARICOM and The Dominican Republic must be classified in four-digit headings of the Harmonised Commodity Description System (HS) which are different from the four-digit heading of the finished product.
- Change of Sub-heading; raw material originating outside of CARICOM and the Dominican Republic must be classified in six-digit sub-headings of the HS, which are different from that of the finished product.
- Change of Chapter; raw material originating outside of CARICOM and the Dominican Republic must be classified in chapters of the HS, which are different from the Chapter in which the finished product is classified.
- Chemical Reaction or Purification; these qualifying conditions are specifically for chemical products classified in Chapters 28 & 29 of the HS.
The following are definitions of the above –
- Chemical Reaction – a process (including the biochemical processes) which results in a molecule with a new structure due to the breaking of the intra-molecular bonds and the formation of new ones, or due to the alteration of the position of the atoms in a molecule.
For the purposes of the present definition, the under mentioned processes are not considered as being chemical reaction.
- dissolving in water or other solvents;
- the elimination of solvents, including water from dissolution;
- the addition or removal of crystallisation
- Purification – a process which causes the elimination of 80% of the content of existing impurities or the reduction or elimination which produces a chemical substance with a minimum degree of purity, in order to make the product suitable for uses such as:
- pharmaceutical substances or food products that satisfy national rules or the international standards;
- reactive chemical products for chemical analysis or for use in laboratories;
- elements and components for use in microelectronics;
- different optical uses;
- human or veterinary usage
- Produced by Specific Process . For a number of products in the Origin Rules the qualifying condition to be complied with specifies the material which may or may not be used if the products are to qualify for duty free treatment.
For example, the qualifying condition for chocolate confectionery of HS heading 1806.31 and 1806.32 is production in which all the non-originating materials used are classified in headings of the HS different from this heading, excluding Chapter 17 (sugar) and Headings 18.01 (cocoa beans), 18.02 (cocoa shells), 18.03 (cocoa paste), 18.04 (cocoa butter) and 18.05 (cocoa powder). This means that the local producer must utilise sugar and cocoa products originating in CARICOM and the Dominican Republic in order to qualify for duty free treatment.
PS. The qualifying criteria for products in Chapters 84 –94 and Chapter 62 of the HS have not yet been finalised; therefore these products will be subject to MFN Treatment when traded between CARICOM and the Dominican Republic.