The EU agreement that lowers your import duties

Many importers budget their European purchases with the full import duty, unaware that a trade agreement could cut it down to 0%. It's the Association Agreement between Central America and the European Union (AACUE) — and if you import European goods without using it, you are probably overpaying taxes.

What the agreement is

It is the trade agreement between the Central American countries and the European Union. Its trade pillar has applied to Costa Rica since October 1, 2013, and it establishes the progressive elimination or reduction of tariffs for goods originating in the EU entering the region (and vice versa: it also benefits Costa Rican exporters shipping to Europe).

After more than a decade in force, most of the tariff phase-out schedule is already consolidated: today the majority of European industrial products that qualify as originating enter at a preferential rate.

What it does for you as an importer

The tax that gets reduced is the import duty (DAI), which normally ranges from 0% to 15% depending on the product. Under the agreement, if your goods qualify and you present the proof of origin:

• The applicable duty can drop to a preferential rate or straight to 0%, depending on the tariff line.
• The saving compounds, because VAT is calculated on a base that includes the duty: less duty also means less VAT.

The full tax calculation is explained in import duties in Costa Rica.

The requirements: origin and proof of origin

Two conditions must be met:

• 1. The product must be "originating" in the EU. Buying it in Europe is not enough: it must meet the agreement's rules of origin (manufactured or sufficiently transformed in the EU). A Chinese product resold by a German company does not qualify.
• 2. You must present the proof of origin at customs. Two options:
  • EUR.1 movement certificate: issued in the exporting country at the time of export.
  • Invoice declaration: specific wording the supplier includes on its invoice. For higher-value shipments, the supplier normally needs to be registered as an approved exporter.

No proof of origin, no preference — even if the product is 100% European. Customs applies the full tariff.

How to request the document from your supplier

• Ask for it at purchase-order time, not when the cargo is already sailing. Retroactive issuance is possible in certain cases, but it means extra paperwork and delays.
• Use the magic phrase: "Please provide an EUR.1 movement certificate (or invoice declaration) for preferential treatment under the EU–Central America Association Agreement." European exporters know it well.
• Check that the EUR.1's description and quantities match the invoice and packing list exactly — discrepancies are the most common cause of rejection.

Which taxes you still pay

The preference applies to the import duty, not to everything. On an import from Europe you will still pay:

• Law 6946 (1%) on the CIF value, save for specific exceptions.
• VAT (13%) on the accumulated base.
• Selective Consumption Tax, only if your product is on the list of goods subject to it.

* Whether preferential treatment applies depends on each product's tariff line and rules of origin. Always confirm your specific case with your customs broker before budgeting.

Written by: Customer Service Department, VS Logistics S.A.