Sustainable Development and the Environmental Goods Negotiations

As from 1999 Estudio López Dardaine has become part of the efforts on behalf of Sustainable Development, a problem that with the turn of the century became, more and more, a significant part of the international agenda. And more recently, within this framework, our consulting group has been studying the complex matter of Environmental Goods at the WTO level. And also at the level of MERCOSUR. As a result of our involvement, we carried out specific studies on Environmental Goods and Services in 2005, 2006 and 2007. We also attended meetings dealing with this question in Cartagena de Indias and Geneva. Through this contribution, our group has been getting ready to face our share of the challenge posed today by Global Warming.

 

Negotiations within MERCOSUR and regarding MERCOSUR with other economic blocks

Ever since MERCOSUR was created in 1991, one of the consulting services that contributed to the prestige of our firm is that related to negotiating import tariff rebates on behalf of our clients. These rebates aim at specific products or group or products, and the actual negotiating process takes place either within the framework of Free Trade Agreements negotiated by MERCOSUR, or through Economic Complementation Agreements (as they are called within the A.L.A.D.I.).

 

Here are a couple of examples of the sort of consulting work we do in this field:
Inclusion of foodstuffs within the structure of the MERCOSUR-Chile Agreement, with a view to the progressive tariff rebate of their respective import duties.
Obtainment of import tariff rebates in order to export textile goods to Argentina and Brazil, on behalf of companies manufacturing their goods in the Andean Community, within the context of the MERCOSUR-Andean Community negotiations.

 

Consulting work in MERCOSUR Tariff description modification and import duty rebate within MERCOSUR

This is a rather complex field of consulting work where Estudio López Dardaine has been active for many years.
 

Here are some examples of consulting work done in this field:
Through internal negotiations within the administrative structure of MERCOSUR, we achieved a permanent import external common tariff reduction from 14 to 2 percent. The product involved is a vital raw material for the synthetic textile sector. The rebate thus granted meant savings for our client of 1,000,000 US dollars during the first year of enforcement.
Having recourse to local negotiations through official administrative channels our client got reference values enforced over a certain period, in order to protect their market from disloyal competition. Together with the enforcement of reference values, the respective chamber was authorised a chamber observer at customs level to cooperate with customs officials during clearance.
Enforcement of waivers for the importation into Argentina of key raw materials for the chemical industry, during a period of ten years, renewable every six months. This meant temporary duty exemptions regarding the MERCOSUR external common tariff, and huge savings for the client on behalf of whom we carried out these negotiations.
MERCOSUR external tariff description modification for a number of special types of papers.

Description modification and external common tariff increase from zero to 14 percent regarding a series of mechanisms locally produced in Argentina by an international firm. This meant enforcement of a significant level of MERCOSUR tariff protection. Said corporation produce these mechanisms and market them in all MERCOSUR countries within the cosmetics and cleaning sectors.
 

 

Negotiation within the A.L.A.D.I. (Latin American Integration Association)

Our group has represented and represents companies aiming at obtaining tariff rebates in order to export from one ALADI country to others or to import from them within the Latin American block. In some cases the opposite target is sought: preventing their own country from granting specific tariff preferences in order to protect their industries. This involves both raw material and end products.

 

A few examples:
Preferences granted for a number of industrial products during the last bilateral round of negotiations between Mexico and Argentina, in order to export to Mexico. Preferences granted are between 60 and 100 percent.
Preventing the inclusion of a relevant plastic material in the abovementioned agreement, which was bound to affect the respective local industry in Argentina.

Also, within same series of rounds, increasing the existing import preference to 100 percent for the importation of a key petrochemical into Argentina.

 

Tariff preference surveys

Among many such studies carried out by our firm, we should like to mention one referred to a series of petrochemicals done on behalf of a Brazilian Group. In essence it consists of the tariffs, the actual import duties and the respective preferences granted among the Latin American countries members of the ALADI, for each product in the family. Although part of this information exists, it is not always available for each of the 12 countries involved and is seldom actually up to date. Furthermore, the national tariffs for each product vary from sub-block to sub-block, such as the ones within MERCOSUR, the ones in the Andean Community, and the Chilean and the Mexican tariffs. If a company is planning their marketing strategy with a view to conquering one or more of the ALADI markets, when exporting from plants sited in an ALADI country, knowing the exact tariff position in each country of destination, the actual import duty and what preferences the country of origin –an their competitors in other ALADI countries- are granted, are essential elements in order to define marketing plans. Not the only ones, but elements without which operating within the block and the sub-blocks would be like flying blindfolded.


Marketing Research

Some of the marketing surveys carried out by our consulting group in the Americas refer to the following products:

  1. Ethylene oxide derivatives in Argentina
  2. Agro-chemical raw material in Argentina
  3. Raw material for the synthetic textile industry in Brazil
  4. Special plastic containers for fisheries in Brazil
  5. Analysing canned fish distribution of Brazilian origin in the Uruguay
  6. Photographic cameras in the State of São Paulo, Brazil
  7. Copybooks and writing material in the State of São Paulo, Brazil
  8. Copybooks and writing material in Chile
  9. Alcoholic beverages in Argentina and Uruguay
  10. Car mufflers for the aftermarket in Florida, US
  11. Cleaning items in Argentina
Top quality Argentine wines in Florida, US    

 

Market Development

Some of the marketing development strategies carried out by our consulting group refer to the following products:
Writing material, photographic cameras, alcoholic beverages, chemicals and petrochemicals, plus the establishment of foundations for the commercial development of a series of both industrial and end-use goods in Argentina, Brazil, Uruguay and the US.   

 

Analysing logistics

We carried out a series of successive analysis based on a model including: FOB prices, import duty preferences, means of transportation, freight, insurance, taxes to be paid in the country of destination, with a view to defining prices at the distribution level. This analysis covered dozens of items and different origins and destinations within South and North America. In a broader sense, in 2008, we surveyed a series of aspects concerning logistics within MERCOSUR, within the framework of Trade Facilitation.

 

Consulting related to internal questions referred to Mercosur

In this field, our consulting group has, for instance, advised the respective producers’ association on technical rules copybooks must adhere to in order to be sold in all MERCOSUR countries. And has accordingly, participated in the respective MERCOSUR internal negotiations.
Similarly, we have done specialised consulting work regarding Mercosur increasing number of internal rules for manufacturers of cleaning articles, cosmetics, petrochemicals and matches.

 Also consulting work for our clients regarding the complex rules of origin MERCOSUR goods still need to comply with.