18 Oct 2018
Colombia Welcomes WTO Determination on Apparel and Footwear Duties
The Colombian government on 5 October welcomed a determination by a World Trade Organisation panel that Colombia’s revised duties on apparel, footwear and made-up textile products comply with the country’s multi-lateral obligations. Since 2013, Colombia and Panama have been involved in a WTO dispute settlement case concerning Colombia’s duty regime for apparel, footwear and made-up textile products, which allegedly has had a negative impact on Asian goods that are exported to Panama’s Colon free zone to be subsequently distributed to other Latin American countries, including Colombia.
Colombian authorities agreed to modify this regime following adverse WTO rulings and in November 2016 established a new system with import duties of:
- 40 percent on apparel of Chapters 61 and 62 with an FOB price equal to or lower than US$10 per gross kilogramme;
- 35 percent on footwear of headings 6401, 6402, 6403, 6404 and 6405 with an FOB price equal to or lower than US$6 per pair (for headings 6401, 6402 and 6404), US$7 per pair (for heading 6405) or US$10 per pair (for heading 6403); and
- 35 percent on footwear uppers of subheading 6406.10 with an FOB price equal to or lower than US$5 per gross kilogramme
Goods with a price higher than the applicable threshold face the regular 15 percent MFN duty.
Panama subsequently challenged Colombia’s implementation of the WTO recommendations and requested permission to retaliate, but a compliance panel was first established to examine the validity of these allegations. After a significant wait, the compliance panel on 5 October determined that Colombia has implemented the relevant recommendations and rulings of the Dispute Settlement Body to bring its measure into conformity with its obligations under the WTO Agreement.