ANDEAN COMMUNITY OF NATIONS
CAN

The Common External Tariff (CET) is the tariff rate uniformly applied to third countries' imports by all Andean Common Market  members.

The CET has been applied since January 31st, 1995.  It was approved in November, 1994 by all its member countries, except Peru, which has not adopted it yet.  (Decision 370).

It has four tariff levels: 5%, 10%, 15%, and 20%, according to products elaboration degree, i.e., the most added value a product has, the highest tariff level will have.

Ecuador has a special regime, through which it can have a 5 points difference comparing with the CET levels, for a not higher than 990 tarif subsectors list.  While Bolivia can apply its 5% and 10% national tariff to third countries' imports.

Exemption regimes, through specific lists, are applied on behalf of Ecuador (with 400 subsections) and Colombia and Venezuela (with 230 subsections each one).  It will be in force until January 1999, after which the general regime will be fully applied.

There is a list that identifies other than Andean Subregion goods.  This is permanently revised and has approximately 2,000 subsections.  The community agreement has been established in order to allow these CET products to be reduced to 5%, and relating capital assets and raw materials, reduction could reach to 0%.

For an agricultural commodities group, the CET could be automatically reduced or increased based on procedures established by the Price Band Andean Band.

- The Common External Tariff let gradually harmonize its member countries economic policies and improve the custom union, making easy the enlonged market performance.  Moreover the CET unifies protections applied to member  countries products entrance.

- It impedes trade triangulation in the Andean Community free zone, thus, avoids distortions.

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