Costa Rica is contesting with the World Trade Organization the Dominican Republic’s decision to put duties on polypropylene bags. The two countries have free trade as part of the Central American Free Trade Agreement.
The Dominican Republic has put what it calls safeguard measures comprising a 38 percent duty for a period of 18 months, according to the Ministerio de Comercio Exterior. This type of trade measure is allowed to protect a local industry from sudden heavy competition. It must be for a fixed time period. In this case it applies to all importers, not just Costa Rica. There was a 30-day period for negotiation before the legal action started.
With the advantage of the free trade agreement Costa Rica has exported $6.5 million in bags and tubes over the last three years, with Costa Rican companies supplying the majority of the market there, the ministry said.
“For our country the imposition of this measure is a violation of WTO rules and a mockery of the preferential terms negotiated as part as the treaties between both countries,” said the vice-minister of foreign commerce, Fernando Ocampo.