1. The Parties establish a Committee on Rules of Origin (hereinafter "the Committee"), composed of representatives of each Party.
2. The functions of the Committee shall include:
(a) monitor the implementation and administration of this Chapter;
(b) report to the Commission on the implementation and administration of this Chapter, as appropriate,
(c) to cooperate in the effective, uniform and consistent administration of this Chapter, and to encourage cooperation in this regard,
(d) review and recommend to the Commission any modifications to Annex 3.1, including when amendments are made to the Harmonized System;
(e) propose to the Parties, through the Commission, modifications to this Chapter. The proposed modifications shall be submitted at the request of one or both Parties, who shall submit the proposals with the corresponding technical support and studies; and
(f) to deal with any other matter related to this Chapter.
3. Unless otherwise agreed by the Parties, the Committee shall meet every two years in ordinary session, on a date mutually agreed by the Parties. The Parties shall determine those cases in which extraordinary meetings may be held.
4. The meetings may be held in person or by any technological means. When they are face-to-face, they shall be held alternately in the territory of each Party, and the host Party shall be responsible for organizing and chairing the meeting, unless they agree otherwise. The first meeting of the Committee shall be held no later than one year after the date of entry into force of this Agreement.
5. Unless otherwise agreed by the Parties, the Committee shall be of a permanent nature and shall develop its working rules.
Article 3.34. Definitions
For the purposes of this Chapter:
aquaculture means the cultivation or farming of aquatic species, including, among others, fish, mollusks, crustaceans, other invertebrates and plants, covering their complete or partial life cycle, from seed such as eggs, fish, shellfish, shellfish, crustaceans, and other invertebrates, and plants, covering their complete or partial life cycle, from seed such as eggs, fish, crustaceans, crustaceans, other invertebrates, and plants, immature fish, fry (3) and larvae. It is carried out in a selected and controlled environment, in natural or artificial water environments, in marine, fresh or brackish waters. It includes stocking or seeding, restocking or replanting, cultivation, as well as research activities and the processing of the products derived from this activity;
CIF means the value of the imported merchandise including insurance and freight costs to the port or place of introduction in the country of importation by whatever means of transport;
shipping containers and packing materials means goods used to protect merchandise during transportation and does not include containers and materials in which merchandise is packaged for retail sale;
authorized entity means:
(a) for Costa Rica, the Promotora de Comercio Exterior de Costa Rica (PROCOMER), or its successor; and.
(b) for Ecuador, the Ministry of Production, Foreign Trade, Investment and Fisheries or its successor, which is the competent authority for the issuance of Certificates of Origin, granting the authorization of authorized exporter and other powers contained in this Chapter. In turn, it may delegate the issuance of Certificates of to authorized entities, in accordance with its national legislation;
exporter means a person located in the territory of a Party from which the good is exported;
FOB means the value of the goods free on board, including the cost of transportation to the final port or place of shipment, regardless of the means of transport;
importer means a person located in the territory of a Party into which the good is imported;
material means a good that is used in the production of another good, including any component, ingredient, raw material, part or piece;
intermediate material means an originating material that is produced by the producer of a good and used in the production of that good;
fungible goods or materials means goods or materials that are interchangeable for commercial purposes and whose properties are essentially identical and which cannot be distinguished from one another by simple visual examination;
identical goods means identical goods as defined in the WTO Customs Valuation Agreement;
non-originating good or non-originating material means a good or material that does not qualify as originating under this Chapter, including materials or goods of unknown origin;
Generally Accepted Accounting Principles means recognized consensus or substantial support authorized and adopted in the territory of a Party with respect to the recording of revenues, expenses, costs, assets and liabilities, the disclosure of information and the preparation of financial statements. Generally Accepted Accounting Principles may encompass broad guidelines of general application, as well as those detailed standards, practices and procedures;
production means the cultivation, extraction, harvesting, fishing, breeding, trapping, hunting, hunting, manufacturing, processing, or assembling of a commodity;
producer means a person who engages in the production of a good in the territory of a Party; and
preferential tariff treatment means the tariff applicable under this Agreement to an originating good.
Chapter 4. Trade Facilitation and Customs Procedures
Article 4.1. General Provisions
1. The Parties reiterate their commitment to implement the Trade Facilitation Agreement, set out in Annex 1A of the WTO Agreement, by ensuring that their import, export and transit operations of goods are applied in a predictable, uniform and transparent manner.
2. Each Party shall employ information technology, to the extent possible, to make its controls more efficient and facilitate legitimate trade.
Article 4.2. Publication
1. Each Party shall publish, including on the Internet, its laws, regulations, and procedures for the import, export, and transit of goods; as well as the forms, required documents, the schedule of personnel operating at ports, airports, land border posts, and other points of entry; the duties and taxes and any other payments applicable to the import, export, and transit of goods, as well as the procedures for appeal or review and penalties.
2. Each Party shall designate or maintain one or more consultation points to address inquiries from interested persons on customs matters, and shall make available on the Internet information regarding the procedures to be followed in making such inquiries.
3. To the extent possible, each Party shall publish in advance any regulations of general application on customs matters that it proposes to adopt, and shall provide interested persons with an opportunity to comment prior to their adoption.
4. Each Party shall ensure that its customs laws, regulations and procedures are transparent and non-discriminatory.
5. Information on fees and charges related to the supply of foreign trade services provided by a Party shall be published, including on the Internet.
Article 4.3. Dispatch of Goods
1. In order to facilitate trade between the Parties, each Party shall adopt or maintain simplified customs procedures for the efficient clearance of goods.
2. Pursuant to paragraph 1, each Party shall adopt or maintain procedures that:
(a) provide for the release of goods within a period no longer than that required to ensure compliance with their customs legislation and, to the extent possible, within 48 hours of arrival;
(b) allow goods to be cleared at the point of arrival, without compulsory transfer to warchouses or other premises, except when the customs authority needs to exercise additional controls, for reasons of infrastructure, acts of God or force majeure; and
(c) allow importers, in accordance with their national legislation, to withdraw the goods from their customs, before and without prejudice to the final determination the customs authority of the applicable customs duties, taxes and charges, for which a guarantee may be required for release prior to payment, provided that this guarantee does not exceed the amount of the final payment and is released after the payment of the obligations has been satisfied.
3. Each Party shall ensure, to the extent possible, that its competent authorities in the control of export and import of goods coordinate, inter alia, the requirements for information and documents, establishing a single place and time for physical verification, without prejudice to the controls that may apply in the case of post-clearance audits.
4. With a view to preventing loss or deterioration of perishable goods, provided that all regulatory requirements have been complied with, each Party shall arrange for the release of perishable goods:
(a) in normal circumstances, as soon as possible after the arrival of the goods and the submission of information required for the release of the goods; and
(b) in exceptional circumstances where it would be appropriate to do so, outside the working hours of your customs authority.
5. Each Party shall give due priority to perishable goods when scheduling any revisions that may be necessary.
6. Each Party shall allow, to the extent possible, the electronic submission of any entry process documents, including licenses, permits, authorizations and other required documents.
Article 4.4. Automation
1. Each Party shall endeavor to use information technology that makes the procedures for the import, export and transit of goods expeditious and efficient. To this end, each Party shall:
(a) will strive to use internationally recognized norms, standards and practices;
(b) will make electronic systems accessible to its customs users;
(c) shall allow the electronic transmission and processing of information and data prior to the arrival of the goods, in order to allow their clearance in accordance with the provisions of article 4.3;
(d) use electronic or automated systems for risk analysis and management, except in duly justified cases;
(e) work on the development of compatible electronic systems between the Parties! customs authorities to facilitate the exchange of international trade data between them;
(f) work to develop the set of common data elements and processes in accordance with the World Customs Organization (hereinafter "WCO") Data Model and related WCO recommendations and guidelines; and
(g) provide for the possibility of adopting procedures that allow the option of electronic payment of duties, taxes, fees and charges for the import, export or transit of goods.
2. Each Party shall adopt or maintain procedures to enable expeditious control of means of transport of goods leaving or entering its territory.
Article 4.5. Risk Administration or Risk Management
1. Each Party shall endeavor to adopt or maintain risk management systems that enable its customs authority to focus its inspection activities on high-risk goods, and that simplify the clearance and movement of low-risk goods, while respecting the confidential nature of information obtained through such activities.
2. In implementing risk management, each Party shall inspect imported goods based on appropriate selectivity criteria, avoiding physical inspection of all goods entering its territory, and to the extent possible, with the aid of non-intrusive inspection instruments.
Article 4.6. Transit of Goods
Each Party shall grant free transit to goods of the other , in accordance with Article V of the GATT 1994, including its interpretative notes.
Article 4.7. Expedited Delivery Shipments
1. Each Party shall adopt or maintain special customs procedures for fast delivery shipments, while maintaining appropriate control and selection systems in accordance with their nature.
2. The procedures referred to in paragraph 1 shall:
(a) provide for separate and expedited customs procedures for fast delivery shipments;
(b) provide for the presentation of the cargo manifest for the clearance of a fast delivery shipment, prior to the arrival of the shipment;
(c) to allow the presentation of a single cargo manifest covering all the goods contained in a shipment transported by an express delivery service, through electronic means;
(d) provide for the clearance of quick delivery shipments of lower risk and/or value with a minimum of documentation required for their release;
(e) under normal circumstances, to the extent possible, provide for the clearance of expedited shipments within 6 hours of presentation of the necessary customs documents, provided the shipment has arrived;
(f) under normal circumstances, to provide that no tariffs shall be fixed for the expedited delivery of correspondence, documents, newspapers and periodicals for non- commercial purposes; and
(g) under normal circumstances, provide that no customs duties shall be levied on expedited in respect of a de minimis value, fixed by each Party in its national legislation. Formal entry documents shall be simplified in accordance with the national legislation of each Party.
Article 4.8. Authorized Economic Operator
1. The Parties shall promote the implementation and strengthening of Authorized Economic Operator (AEO) programs in accordance with the WCO Framework of Standards to Secure and Facilitate Global Trade (SAFE Framework of Standards), in order to facilitate the clearance of their goods. Their obligations, requirements and formalities shall be established in accordance with the national legislation of each Party.
2. The customs authorities of the Parties shall move forward, in accordance with their respective legal systems, in the subscription and effective implementation of Mutual Recognition Agreements between them.
Article 4.9. Foreign Trade Single Window
The Parties shall promote the creation of a Foreign Trade Single Window to expedite and facilitate trade. The Parties shall seek interoperability between their Single Windows.
Article 4.10. Review and Appeal
Each Party shall ensure, with respect to administrative acts concerning the import, export and transit of goods, that persons subject to such acts have access to:
(a) a level of administrative review that is independent of the official or office that issued the act; or
(b) at least one level of judicial review.
Article 4.11. Sanctions
Each Party shall adopt or maintain measures that allow for the imposition of administrative sanctions and, where appropriate, criminal sanctions, for the violation of national legislation on customs matters.
Article 4.12. Advance Rulings
1. Each Party shall issue in writing an advance ruling prior to the importation of a good into its territory, when an importer in its territory, or an exporter or producer in the territory of the other Party has so requested in writing, with respect to:
(a) tariff classification;
(b) the application of customs valuation criteria for a particular case, in accordance with the application of the provisions contained in the WTO Customs Valuation Agreement;
(c) whether a good is originating under Chapter 3 (Rules of Origin and Origin Procedures) of this Agreement;
(d) such other matters as the Parties may agree.
2. Each Party shall issue the advance ruling within 60 calendar days of the filing of the request, provided that the applicant has submitted all information to the satisfaction of the customs authority, including, if requested, a sample of the good for which the applicant is requesting the advance ruling. In issuing the advance ruling, the Party shall take into account the facts and circumstances submitted by the applicant.
3. Each Party shall provide that advance rulings shall take effect from the date of their issuance, or such other date specified in the ruling provided that the facts or circumstances on which the ruling is based have not changed.
4. Each Party shall endeavor to make its advance rulings publicly available, including on the Internet, subject to confidentiality requirements under its national law.
5. The advance rulings issued and in force may be annulled, modified or revoked by the same authorities that issued them, ex officio or at the request of the applicant, when one of the following situations arises:
(a) the competent authority has knowledge that the resolution was issued based on information provided by the applicant in a false, incorrect or inaccurate manner or omits circumstances or facts relevant to the decision making process. In such cases, the effects of the annulment shall be applicable as of the date on which the advance tuling was issued and the appropriate civil, criminal and administrative penalties may be applied in accordance with the national legislation of each Party;
(b) the competent authority considers it appropriate to apply different criteria on the same facts and circumstances that were the object of the initial advance ruling. In this event, the modification or revocation shall be applied as from the date of the change and in no case may it be opposed to situations presented while the resolution was in force; or
(c) when the decision must be modified due to changes introduced in the rules that served as basis, it shall apply only as of the date on which the changes in the rules were generated and in no case may it be opposed to situations presented while the decision was in force.
With respect to subparagraph (a), the Competent Authority shall notify the applicant of the respective resolution. In the cases provided for in subparagraphs (b) and (c), the Competent Authority shall make the revised information available to the interested persons sufficiently in advance of the date on which the amendments become effective.
Article 4.13. Committee on Trade Facilitation and Customs Procedures
1. The Parties establish a Committee on Trade Facilitation and Customs Procedures (hereinafter "the Committee"), composed of representatives of each Party.
2. The functions of the Committee shall include:
(a) monitor the implementation and administration of this Chapter;
(b) report to the on the implementation and administration this Chapter, as appropriate;
(c) promptly deal with matters proposed by a Party with respect to the development, adoption, application or implementation of the provisions of this Chapter;
(d) to promote the joint cooperation of the Parties in the development, application, implementation, execution and improvement of all matters pertaining to this Chapter, as well as to serve as a forum for consultation and discussion on such matters;
(e) at the request of a Party, resolve consultations on any matter arising under this Chapter within 30 days,
(f) propose solutions to the Commission on issues related to:
(i) interpretation and application of this Chapter;
(ii) customs tariff classification matters; and
(iii) other matters relating to practices or procedures adopted by the Parties under this Chapter; and
(g) to deal with any other matter related to this Chapter.
3. Unless otherwise agreed by the Parties, the Committee shall meet every two years in ordinary session, on a date mutually agreed by the Parties. The Parties shall determine those cases in which extraordinary meetings may be held.
4. The meetings may be held in person or by any technological means. When they are face-to- face, they shall be held alternately in the territory of each Party, and the host Party shall be responsible for organizing and chairing the meeting, unless they agree otherwise. The first meeting of the Committee shall be held no later than one year after the date of entry into force of this Agreement.
5. Unless otherwise agreed by the Parties, the Committee shall be of a permanent nature and shall develop its working rules.
Article 4.14. Cooperation
1. In order to facilitate the effective operation of this Chapter, each Party shall endeavor to give prior notice to the other Party of any significant changes in its customs legislation that may affect the implementation of this Chapter.
2. The Parties shall cooperate to achieve compliance with their respective legislation with respect to:
(a) the implementation and operation of the provisions of this Chapter in matters imports or exports, transit of goods;
(b) the implementation and operation of the WTO Customs Valuation Agreement;
(c) restrictions or prohibitions on imports or exports;
(d) training of staff and users; and
(e) such other customs matters as the Parties may agree.
3. In order to facilitate trade between the Parties, each Party shall endeavor to provide the other with technical advice and assistance for the purpose of improving risk assessment and risk management techniques, simplifying and expediting customs procedures for the timely and efficient clearance of goods, improving the technical skills of personnel, and increasing the use of technologies that may lead to better compliance with a Party's customs legislation.
4. The Parties shall make efforts to cooperate in:
(a) strengthen each Party's ability to enforce customs legislation;
(b) improve coordination in matters related customs issues;
(c) facilitate the exchange of information between the Parties regarding their experiences in the implementation and strengthening of the Foreign Trade Single Windows; and
(d) exchange experiences in the national committees on trade facilitation, their functions, and their work to facilitate internal coordination and implementation of commitments under the WTO Trade Facilitation Agreement.
5. The Parties agree to enter into an Agreement on Cooperation and Mutual Assistance in Customs Matters.
6. Each Party shall designate and notify a focal point for matters arising under this article. The Parties shall notify without delay of any changes important in contact information. They may also establish and maintain other channels of communication in order to facilitate the secure and rapid exchange of information.
Chapter 5. Good Regulatory Practices
Article 5.1. Definitions
For the purposes of this Chapter:
(a) Regulatory impact analysis is the systematic process of analyzing and determining the impact of regulatory measures based on the definition of a problem. This analysis is a fundamental public policy tool for evidence-based decision making, allowing to present alternatives so that the regulatory authority can choose the option it deems appropriate to solve the problem and maximize social welfare;
(b) good regulatory practices refers to the use of tools in the process of planning, drafting, adopting, implementing, reviewing and monitoring regulatory measures;
(c) public consultation is the participatory mechanism, of a consultative and non- binding nature, by means of which the State, during a reasonable period of time, collects data and opinions from society in relation to a draft regulatory measure; and
(d) regulatory measures refer to measures of general application determined in accordance with Article 5.3, related to any matter covered by this Agreement, adopted by the regulatory authorities, and the observance of which is mandatory.
Article 5.2. General Objective
The general objective of this Chapter is to reinforce and encourage the adoption of good regulatory practices, in order to promote the establishment of a transparent regulatory environment with predictable procedures and stages, both for citizens and economic operators.
Article 5.3. Scope of Application
Each Party shall, in accordance with its domestic legislation and planning, determine and make publicly available the regulatory measures to which the provisions of this Chapter shall apply.
Article 5.4. General Provisions
1. The Parties reaffirm their commitment to adopt good regulatory practices in order to facilitate trade in goods and services, as well as the flow of investment between them.
2. The provisions of this Chapter shall not affect the right of the Parties to: