Summary of the rules of origin under the U.S.-Colombia TPA.
Last Published: 10/25/2016
Determining Eligibility for Preferential Treatment under the U.S.-Colombia TPA
The information provided here gives general guidance on how to locate the relevant rules of origin and determine whether your product may qualify for a reduced tariff (or “duty”) benefit under the U.S.-Colombia TPA. Special rules apply for textile and apparel products and certain agricultural and industrial products.

Only the Colombian Customs Service can definitively determine whether a product qualifies for preferential treatment. Additional information can be found by contacting your local U.S. Export Assistance Center.

Rules of origin (ROOs) are used to define which products may qualify for preferential tariff rates under a trade agreement. These rules vary by trade agreement and product. In general, the importer is responsible for claiming preferential treatment from the importing country’s customs authority.

Additionally, make sure that you are permitted to export your product and that your product complies with U.S. export licensing requirements and regulations, as well as with the foreign regulations and standards of Colombia.

For questions relating to customs requirements for importing into the United States under the U.S.-Colombia TPA, please refer to U.S. Customs and Border Protection interim regulations and implementing instructions or contact CBP at fta@dhs.gov.

Determine your product’s classification
Determining your product’s classification can be a multi-step process. Only the Colombian Customs Service can definitively determine whether a product is classified correctly under Colombia’s tariff schedule. Provided here are steps that should help you get reasonably close to classifying your product in order to determine whether to claim tariff preferences under the TPA.

The first step is to look up your U.S. Schedule B classification. This serves two purposes. The first is that it may be required on your export documentation. Second, the initial six-digits (referred to as the HS Code) will tend to be, if not the same, in the same neighborhood as your product’s classification in the Colombian tariff schedule and its listing in the U.S.-Colombia TPA Rules of Origin. Since HS Codes are largely standardized from country-to-country, identifying your product’s HS Code under the U.S. Schedule B puts you well on the path to finding your product’s classification in Colombia. However, despite this standardization, it is ultimately up to the Colombian Customs Service to determine how your product will be classified.

To find your Schedule B classification, we recommend starting with the U.S. Census Bureau’s Schedule B database. The FTA Tariff Tool is another resource available. Enter the first six-digits of your product’s U.S. Schedule B classification (the HS Code), into the FTA Tariff Tool with “FTA Partner” set to “Colombia”. This will pull up all the 10-digit tariff codes containing those six digits from Colombia’s tariff schedule, in order. Note that because the Colombian tariff schedule often does not identify products at greater detail than that described by the six-digit HS Code, it is likely that you will only get one result from this search (i.e the six-digit HS Code with four zeros [“0”] on the end). But, if you do get more than one result, looking at all the results that start with the same six digits will show you how Colombia sub-divides your product’s HS Code when assigning tariff rates. You will need to determine whether your product is likely covered by the product descriptions attached to one of those lines. The 10-digit code in the first column should be your product’s tariff classification in the Colombian tariff schedule. From the results page in the FTA Tariff Tool, click on View Details to see the FTA-negotiated preferential tariff rate (FTA rate) and phase-out schedule for your product.

Determine whether there is an advantage to claiming preferential treatment under the U.S.-Colombia TPA
Sometimes a country’s tariff on an imported product from all countries (MFN rate) can be as low as or lower than the currently applicable FTA-negotiated preferential tariff rate (FTA rate). Since there are time and record-keeping costs associated with claiming preferential treatment, the MFN rate should be compared to the FTA rate.

There are two resources that will have pieces of the information you need: the FTA Tariff Tool shows you the FTA rate, including for future years, while the Customs Info Database show you the current MFN tariff rates.

FTA Tariff Tool - You can input the HS Code or tariff classification into the FTA Tariff Tool to identify the FTA rate agreed to for the product for this year and for future years. Colombian TPA rates for most products were set at zero as of May 15, 2012, but rates on some products are staged down in increments from their starting rates to zero over a period of years. Note: Textile and apparel products and agricultural products are not yet included in this tool.

Customs Info Database - This database allows users to look up the current Colombian MFN tariff rate for shipments originating in the United States and (coming soon) compare it with the FTA rate, using the first four to six digits of the product’s HS Code. Users of Export.gov are offered a free trial of the system with registration. This database also includes the Value Added Tax for Colombia for your product. Here are instructions for setting up an account for Customs Info Database.

If the MFN rate is less than or equal to the FTA rate, there is most likely no advantage to qualify your product. However, if the FTA rate is lower, then you should determine if your product may qualify for the FTA rate. For U.S.-originating products to enter Colombia under the preferential tariff rate, the importer must submit a claim for the FTA rate. This may be done by submitting a certification of origin or an importer attestation.

Identify the Rule of Origin under U.S.-Colombia TPA
The rules of origin define which products qualify for the FTA-negotiated preferential tariff rate (FTA rate) under the U.S.-Colombia TPA.

Broadly speaking, products that are originating in either the United States or Colombia are eligible for the FTA rate – although only the Colombian Customs Service can definitively make a determination about FTA eligibility for imports into Colombia. A product is originating under the U.S.-Colombia TPA if it is a) wholly produced or obtained entirely in the United States or Colombia, b) produced entirely in the United States and Colombia and each of the non-originating materials (inputs) that are part of the good (product) being exported have met the relevant product-specific rule of origin; or c) produced entirely in the U.S. or Colombia from originating materials (inputs).

A wholly obtained or produced good is defined as:
(a) plants and plant products harvested or gathered in the territory of one or more of the Parties;
(b) live animals born and raised in the territory of one or more of the Parties;
(c) goods obtained in the territory of one or more of the Parties from live animals;
(d) goods obtained from hunting, trapping, fishing, or aquaculture conducted in the territory of one or more of the Parties;
(e) minerals and other natural resources not included in subparagraphs (a) through (d) extracted or taken from the territory of one or more of the Parties;
(f) fish, shellfish, and other marine life taken from the sea, seabed, or subsoil outside the territory of one or more of the Parties by vessels registered or recorded with a Party and flying its flag;
(g) goods produced on board factory ships from the goods referred to in subparagraph (f), provided such factory ships are registered or recorded with that Party and fly its flag;
(h) goods taken by a Party or a person of a Party from the seabed or subsoil outside territorial waters, provided that a Party has rights to exploit such seabed or subsoil;
(i) goods taken from outer space, provided they are obtained by a Party or a person of a Party and not processed in the territory of a non-Party;
(j) waste and scrap derived from:
i. manufacturing or processing operations in the territory of one or more of the Parties, or
ii. used goods collected in the territory of one or more of the Parties, provided such goods are fit only for the recovery of raw materials;
(f) recovered goods derived in the territory of one or more of the Parties from used goods and utilized in the territory of one or more of the Parties in the production of remanufactured goods; and
(h) goods produced in the territory of one or more of the Parties exclusively from goods referred to in subparagraphs (a) through (j), or from their derivatives, at any stage of production.
 
A simplistic illustration of this might be a wooden bowl, which to be originating could be a) made in the United States from U.S. wood; b) made in the United States from Argentine wood, but because the wood has been transformed into a bowl, it now meets the rule of origin for a bowl; or c) made in the United States from Colombian wood.

Product specific rules are listed by HS Code in Annex 4.1 of the Agreement or according to Chapter 3, Article 3.3 (textiles and apparel). If your product is produced in the United States or Colombia and contains non-originating inputs (non-US and non-Colombian content, including content from an unknown origin), you will need to look at the specific rule of origin for your product to determine whether it is originating under the U.S.-Colombia TPA. There is a limited de minimis exception (Chapter 4, Article 4.6) available for most products where the non-originating inputs do not exceed 10 percent of the adjusted value of the product. However, there are restrictions on this exception for various agricultural products and a different rule applies for textiles and apparel products (Article 3.3.8 and 3.3.9).

Although rules of origin under the U.S.-Colombia TPA differ by product, they typically fall within three general categories, consisting of:
1) A change in tariff classification (tariff-shift); or
2) A regional value-content requirement (RVC); or
3) A combination of change in tariff classification and regional value content.

Prepared by the International Trade Administration. With its network of 108 offices across the United States and in more than 75 countries, the International Trade Administration of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



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