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Mercosur Extends Mechanism to Increase Duties on Up to 100 Tariff Lines, Higher Duties on Toys and Dairy Products

The Mercosur Common Market Council recently took a number of trade-related actions of potential interest to Hong Kong and mainland Chinese exporters. Of particular importance is the extension through 31 December 2021 of the mechanism that allows Mercosur countries (Argentina, Brazil, Paraguay, Uruguay and Venezuela) to temporarily increase their import duties on a limited number of products above the levels established in the common external tariff. The new mechanism is limited to a maximum of 100 tariff lines at the eight-digit level, down from 200 tariff lines under the mechanism that expired at the end of last year.

Any Mercosur member state that wishes to increase its import duties must submit a request to the other member states, which will have 15 working days to consider that request and raise any objections. If no objections are raised during the stipulated period, the member state requesting the duty increase may implement it immediately for up to 12 months, with the possibility of annual renewals.

Also of importance is the extension through 31 December 2021 of the higher (35 percent) duties currently in place on toys classified under NCM 9503.00.10, 9503.00.21, 9503.00.22, 9503.00.31, 9503.00.39, 9503.00.40, 9503.00.50, 9503.00.60, 9503.00.70, 9503.00.80, 9503.00.91, 9503.00.97, 9503.00.98 and 9503.00.99. Similarly, the higher (28 percent) duties in place on certain dairy products classified under NCM 0402.10.10, 0402.10.90, 0402.21.10, 0402.21.20, 0402.29.10, 0402.29.20, 0402.99.00, 0404.10.00, 0406.10.10, 0406.90.10 and 0406.90.20 have been extended through 31 December 2023, although Paraguay and Venezuela will be able to maintain their current duties on some or all of these products. Finally, the higher (35 percent) duties in place on peaches classified under NCM 2008.70.10, 2008.70.20 and 2008.70.90 have also been extended through 31 December 2023, although Paraguay, Uruguay and Venezuela will be able to maintain their current duties on some or all of these products.

It is also worth mentioning that the mechanism that allows Mercosur countries to have a national list of exceptions to the common external tariff has been extended through 31 December 2021 for Argentina and Brazil (up to 100 tariff lines each), 31 December 2022 for Uruguay and Venezuela (up to 225 tariff lines each), and 31 December 2023 for Paraguay (up to 649 tariff lines). Mercosur members will also be able to continue to use drawback and temporary importation regimes for intra-regional trade through 31 December 2023. In addition, the regional bloc has vowed to update its common regime for the importation of capital goods not made in the region with the goal of implementing a harmonised regime by 1 January 2022, for Argentina and Brazil, and 1 January 2024, and for all other member countries.

Content provided by Picture: HKTDC Research
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