Official Codified Text of the Andean Subregional Integration Agreement
THE COMMISSION OF THE ANDEAN COMMUNITY,
HAVING SEEN: The Amending Protocol of the Andean
Subregional Integration Agreement (Cartagena Agreement of 1997), known as the
�Sucre Protocol,� adopted in Quito on June 25, 1997;
CONSIDERING: That the Sucre Protocol entered into force on
April 14, 2003; and
That article 32 of the Sucre Protocol stipulates that the
Andean Community Commission shall adopt, through a Decision, the amended
consolidated text of the Andean Subregional Integration Agreement (Cartagena
Agreement) that incorporates the amendments introduced by the cited Protocol
and that the necessary changes shall be made in the numbering of the articles;
Article 1.- To approve the codification of the Andean
Subregional Integration Agreement, �The Cartagena
Agreement,� in the terms that appear in the annex to this Decision.
Article 2.- This Decision replaces Decision 406 of June 25, 1997.
Signed in the Quirama Recinto, Antioquia Department,
of the Republic of Colombia, on the twenty-fifth of June of two thousand
ANDEAN SUBREGIONAL INTEGRATION
THE GOVERNMENTS of Bolivia, Colombia, Ecuador, Peru, and
INSPIRED by the Declaration of Bogot� and by the
Declaration of the Presidents of America;
RESOLVED to strengthen the union of their peoples and to
lay the foundations for advancing toward the formation of an Andean
AWARE that integration constitutes a historical, political,
economic, social, and cultural mandate for their countries, in order to
preserve their sovereignty and independence;
BASED on the principles of equality, justice, peace,
solidarity, and democracy;
DETERMINED to attain such goals by creating an integration
and cooperation system that will lead to the balanced, harmonious, and shared
economic development of their countries;
AGREE, through their duly authorized plenipotentiary
representatives, to enter into the following SUBREGIONAL INTEGRATION
OBJECTIVES AND MECHANISMS
Article 1.- The objectives of this Agreement are to
promote the balanced and harmonious development of the Member Countries under
equitable conditions, through integration and economic and social cooperation;
to accelerate their growth and the rate of creation of employment; and to
facilitate their participation in the regional integration process, looking
ahead toward the gradual formation of a Latin American Common Market.
This Agreement also seeks to reduce external vulnerability
and to improve the positioning of the Member Countries within the
international economic context; to strengthen subregional solidarity, and to
reduce existing differences in levels of development among the Member
These objectives are aimed at bringing about an enduring
improvement in the standard of living of the subregion�s population.
Article 2.- Balanced and harmonious development shall
lead to a fair distribution among the Member Countries of the benefits
deriving from integration, so that the existing differences among them are
reduced. The results of that process shall be evaluated periodically, bearing
in mind, among other elements, its effects on the growth of each country�s
total exports, the performance of its balance of trade with the subregion, the
evolution of its gross domestic product, the creation of new jobs, and capital
Article 3.- The following mechanisms and measures shall
be used, among others, to fulfill the objectives of this Agreement:
a) The integration with other economic blocs in the
region will be intensified and political, social and economic-trade
relations will be established with extra-regional systems.
b) Economic and social policies will be gradually
harmonized and national laws with regard to pertinent matters will be
c) Joint programming will be instituted, subregional
industrialization will be intensified, industrial programs will be
implemented, and other means of industrial integration will be applied;
d) A more advanced schedule of trade liberalization than
the commitments derived from the 1980 Treaty of Montevideo will be
e) A Common External Tariff will be adopted;
f) Programs will be carried out to accelerate the
development of the agricultural and agroindustrial sectors;
g) Resources will be channeled from in and outside the
Subregion to finance the investments needed by the integration process;
h) Programs will be conducted in the areas of services
and the liberalization of intra-subregional trade in services;
i) Physical integration will be pursued; and
j) Bolivia and Ecuador will receive preferential
In addition to the mechanisms set out above, the following
economic and social cooperation programs and aims shall be carried out in a
a) Programs to promote scientific and technological development;
b) Border integration measures;
c) Programs in the area of tourism;
d) Activities for the use and preservation of natural resources and the
e) Social development programs: and
f) Efforts in the field of social communications.
Article 4.- To carry out this Agreement in the best way
possible, Member Countries shall make the necessary efforts to seek adequate
solutions to the problems stemming from Bolivia�s landlocked condition.
ON THE ANDEAN COMMUNITY AND THE ANDEAN INTEGRATION SYSTEM
Article 5.- The "Andean Community" is hereby created,
composed of the sovereign States of Bolivia, Colombia, Ecuador, Peru, and
Venezuela, and of the bodies and institutions of the Andean Integration
System, and is established by this Agreement.
Article 6.- The Andean Integration System is made up of
the following bodies and institutions:
- The Andean Presidential Council;
- The Andean Council of Foreign Ministers;
- The Andean Community Commission;
- The Andean Community General Secretariat;
- The Andean Community Court of Justice;
- The Andean Parliament;
- The Business Advisory Council;
- The Labor Advisory Council;
- The Andean Development Corporation;
- The Latin American Reserve Fund;
- The Sim�n Rodr�guez Convention, the Social Conventions
that join the Andean Integration System, and those that are created within
- The Sim�n Bol�var Andean University;
- The Advisory Councils established by the Commission; and,
- All other bodies and institutions that are created
within the framework of Andean subregional integration.
Article 7.- The purpose of the System is to allow for
effective coordination among its component bodies and institutions, in order
to deepen Andean subregional integration, promote its external influence and
consolidate and strengthen actions related to the integration process.
Article 8.- The bodies and institutions of the Andean
Integration System are governed by this Agreement and by their respective
establishing treaties and amending protocols.
Article 9.- In order to achieve the best possible
coordination within the Andean Integration System, the Chairman of the Andean
Council of Foreign Ministers will call and chair the Meetings of
Representatives of the institutions that comprise the System.
The main tasks of the Meeting shall be:
a) To exchange information about the actions taken by the
respective institutions to carry out the Guidelines issued by the Andean
b) To study the possibility and desirability of
arranging, among all or some of the institutions, to carry out coordinated
actions that will contribute to the achievement of the objectives of the
Andean Integration System; and,
c) To present to the Andean Council of Foreign Ministers
meeting in enlarged session, reports about the actions carried out in
fulfillment of the Guidelines that have been received.
Article 10.- The Representatives of the institutions
comprising the Andean Integration System shall meet in regular session at
least once a year and in special session whenever requested to do so by any of
the member institutions, at the site agreed upon before the meeting is called.
The Andean Community General Secretariat shall act as the
Secretariat for the Meeting.
Section A - On The Andean Presidential Council
Article 11.- The Andean Presidential Council is the
highest-level body of the Andean Integration System and is made up of the
Heads of State of the Member Countries of the Cartagena Agreement. It issues
Guidelines on the different spheres of Andean subregional integration, which
are carried out by the System bodies and institutions determined by the
Council, in keeping with the responsibilities and mechanisms established in
their respective Treaties or establishing Agreements.
The bodies and institutions of the System shall guide their
policies in the way directed by the Guidelines issued by the Andean
Article 12.- It is the Andean Presidential Council�s responsibility:
a) To define Andean subregional integration policy;
b) To guide and promote action on matters of interest to
the Subregion as a whole, as well as on those related to the coordination
among the bodies and institutions of the Andean Integration System;
c) To evaluate the development and results of the Andean
subregional integration process;
d) To consider and issue opinions about reports,
initiatives, and recommendations that are submitted by the bodies and
institutions of the Andean Integration System; and
e) To study all issues and matters concerning the course
of Andean subregional integration and its external projection.
Article 13.- The Andean Presidential Council shall meet
regularly once a year, preferably in the country that chairs it. In this
meeting, it shall review the actions taken by the bodies and institutions of
the Andean Integration System, as well as their projects, programs, and
suggestions. The members of the Andean Council of Foreign Ministers and of the
Commission, and representatives of the System bodies and institutions, may
attend the meetings of the Andean Presidential Council as observers.
The Andean Presidential Council may meet in special session
whenever it considers this advisable, at the place agreed upon before the
meeting is called.
Article 14.- The Andean Presidential Council shall have
a Chairman who shall be the Andean Community�s top political representative,
and who shall hold office for a period of one calendar year. That position
shall be filled, successively and in alphabetical order, by each of the Member
The responsibilities of the Chairman of the Andean Presidential Council
a) To convene and chair the regular and special meetings of the Council;
b) To represent the Council and the Andean Community;
c) To ensure that the Guidelines issued by the Council are carried out by
the other bodies and institutions of the Andean Integration System; and,
d) To carry out all tasks requested by the Council.
Section B - On the Andean Council of Foreign Ministers
Article 15.- The Andean Council of Foreign Ministers is
comprised of the Ministers of Foreign Affairs of the Member Countries of the
Article 16.- The responsibilities of the Andean Council
of Foreign Ministers are:
a) To formulate the Member Countries� foreign policy on
matters of subregional interest, as well as to orient and coordinate the
external efforts of the different bodies and institutions of the Andean
b) To formulate, carry out, and evaluate general Andean
subregional integration policy, in coordination with the Commission;
c) To carry out the Guidelines given to it by the Andean
Presidential Council and to ensure the execution of those that are intended
for the other bodies and institutions of the Andean Integration System;
d) To sign Conventions and Agreements with third
countries or groups of countries or with international organizations in
regard to global foreign policy and cooperation issues;
e) To coordinate, within its sphere of responsibility,
the joint position of the Member Countries in international forums and
f) To represent the Andean Community, within the sphere
of its competence, in matters and acts of common interest, according to the
rules and objectives of the Agreement;
g) To recommend or adopt measures within its area of
responsibility that will ensure the accomplishment of the purposes and
objectives of the Cartagena Agreement;
h) To ensure harmonious compliance with the obligations
set out in this Agreement and in the 1980Treaty of Montevideo;
i) To approve and modify its own regulations;
j) To approve the General Secretariat�s Regulations and
all amendments thereto at the proposal of the Commission;
k) To hear and resolve, within its area of
responsibility, all other matters of common interest.
Article 17.- The Andean Council of Foreign Ministers
shall express itself through Declarations and Decisions adopted by consensus.
The latter shall be a part of Andean Community Law.
Article 18.- The Andean Council of Foreign Ministers
shall meet in regular session twice a year, preferably in the country that
chairs the Council. It may also meet in special session, when deemed
advisable, at the request of any of its members, in the place agreed upon
before the meeting is convened.
Article 19.- The Andean Council of Foreign Ministers
shall be headed by the Foreign Minister of the country that chairs the Andean
Presidential Council, who shall hold office for a period of one calendar year.
The coordination work corresponding to the Chairman of this
Council shall be performed by the Foreign Ministry of the country whose Head
of State chairs the Andean Presidential Council, acting as the Pro Tempore
Secretariat of both bodies and with the technical support of the Andean
Community General Secretariat.
Article 20.- The Andean Council of Foreign Ministers
shall meet in enlarged session with the delegation representatives to the
Commission at least once a year and, at the level of alternative
representatives, whenever it considers it necessary, in order to discuss
matters related to the Cartagena Agreement that are of interest to both
bodies, such as:
a) To prepare the meetings of the Andean Presidential Council;
b) To choose and, when suitable, remove the General
Secretary of the Andean Community;
c) To propose to the Andean Presidential Council any
amendments to this Agreement;
d) To evaluate the performance of the General Secretariat;
e) To consider the initiatives and proposals submitted
for its consideration by the Member Countries or the General Secretariat;
f) Any other issues that both bodies decide to address jointly by common
Section C - The Andean Community Commission
Article 21.- The Andean Community Commission shall be
comprised of a plenipotentiary representative from each Member Country�s
government, which shall accredit a representative and an alternate
The Commission shall express its will through Decisions.
Article 22.- It is the responsibility of the Andean Community
a) To formulate, carry out, and evaluate Andean
subregional integration policy in the area of trade and investment and, when
in order, in coordination with the Andean Council of Foreign Ministers;
b) To take the necessary measures to accomplish the
objectives of the Cartagena Agreement and to implement the Guidelines laid
down by the Andean Presidential Council;
c) To coordinate, within its sphere of responsibility,
the joint position of the Member Countries in international forums and
d) To ensure harmonious compliance with the obligations
set out in this Agreement and in the 1980 Treaty of Montevideo;
e) To approve and amend its own regulations;
f) To approve, reject or amend the proposals submitted to
it by the Member Countries, individually or collectively, or by the General
g) To maintain ongoing relations with the bodies and
institutions comprising the Andean Integration System, in order to boost the
coordination of programs and measures aimed at accomplishing its common
h) To represent the Andean Community, within the sphere
of its responsibilities, in matters and acts of common interest, in keeping
with the rules and objectives of this Agreement;
i) To approve the annual budgets and evaluate the
budgetary performance of the General Secretariat and the Andean Community
Court of Justice, and to set the contributions to be paid by each of the
Member Countries; and,
j) To submit the proposed Regulations of the General
Secretariat for consideration by the Andean Council of Foreign Ministers.
In fulfilling its responsibilities, the Commission shall
give special consideration to Bolivia and Ecuador�s situation in terms of the
objectives of this Agreement, the preferential treatment provided in their
favor, and Bolivia�s landlocked status.
Article 23.- The Commission shall have a Chairman, who
shall hold office for one calendar year. That office shall be filled by the
representative of the country that is currently chairing the Andean
Article 24.- The Commission shall meet on a regular
basis three times a year and in special session whenever such a meeting is
called by its Chairman at the request of any of the Member Countries or the
Its sessions shall be held at the headquarters of the
General Secretariat, but they may also take place elsewhere. The Commission
shall meet with the presence of an absolute majority of the Member Countries.
Attendance at Commission meetings is obligatory and failure
to attend shall be considered an abstention.
Article 25.- At the request of one or more of the
Member Countries or of the General Secretariat, the Commission�s Chairman
shall summon the Commission to meet as an Enlarged Commission, in order to
address sector issues, consider regulations for coordinating the development
plans and harmonizing the economic policies of the Member Countries, and hear
and resolve all other matters of common interest.
The meetings shall be presided over by the Commission
Chairman and shall be jointly comprised of the representatives to the
Commission and the Ministers or Secretaries of State of the respective area.
Each country is entitled to cast one vote in order to approve Decisions that
will become a part of Andean Community Law.
Article 26.- The Commission shall adopt its Decisions
by affirmative vote of the absolute majority of the Member Countries. The
exceptions to this general rule are:
a) The matters included in
Annex 1 to this Agreement, in which case the Commission shall adopt its
Decisions by the affirmative vote of the Member Countries with no negative
votes being cast.
The Commission may add new matters to that Annex through
the affirmative vote of the absolute majority of the Member Countries;
b) For the cases listed in Annex II,
General Secretariat proposals shall be approved with the affirmative vote of
the absolute majority of the Member Countries, provided that no negative
vote is cast. Any proposal that receives the affirmative votes of the
absolute majority of the Member Countries, but also a negative vote, shall
be returned to the General Secretariat for consideration of the grounds for
that negative vote. Within a period of no less than two months or more than
six, the General Secretariat shall present the proposal once again for
consideration by the Commission, including any modifications it deems
appropriate. The amended proposal shall be considered approved if it
receives the affirmative vote of the absolute majority of the Member
Countries, with no negative vote. In this case, the vote of the country that
had dissented previously shall not be counted as a negative vote; and
c) Industrial Development Programs and Projects shall be
approved with the affirmative vote of the absolute majority of the Member
Countries, provided that no negative vote is cast.
Article 27.- The General Secretariat or the Member
Countries shall present their proposals at least fifteen days prior to the
corresponding meeting of the Andean Council of Foreign Ministers or of the
Commission. Only in duly justified exceptional cases and in accordance with
Andean Community Law may the required deadlines be waived, provided that both
the proponent and the other Member Countries agree to this.
Proposals that receive the affirmative vote of the absolute
majority of the Member Countries, but also a negative vote, shall be returned
to the proponent for consideration of the grounds that gave rise to that
Within a period of no less than one month or more than
three, the proponent shall once again present the proposal for consideration
by the corresponding body, incorporating any modifications it considers
appropriate. In that case, the amended proposal shall be considered approved
if receives the affirmative vote of the absolute majority of the Member
Article 28.- Any Member Country that falls behind more
than four quarters in the payment of its contributions to the General
Secretariat or to the Andean Community Court of Justice may not exercise its
right to vote in the Commission until it resolves that situation.
In such cases, the quorum for attendance and voting shall
be computed according to the number of contributing countries.
Section D - The Andean Community General Secretariat
Article 29.- The General Secretariat is the executive
body of the Andean Community and, as such, acts solely in accordance with the
interests of the Subregion. The General Secretariat shall give technical
support, when appropriate, to the other bodies and institutions of the Andean
The General Secretariat shall be headed by the General
Secretary. In performing his duties, the General Secretary shall rely on the
Directors General, in accordance with the respective regulations. The General
Secretary shall also enjoy the services of any technical and administrative
staff needed to accomplish his duties. The General Secretariat shall express
itself through Resolutions.
Article 30.- The Andean Community General Secretariat�s
a) To ensure the application of this Agreement and
compliance with the provisions that comprise Andean Community Law;
b) To carry out the tasks assigned to it by the Andean
Council of Foreign Ministers and the Commission;
c) To formulate and put forward draft Decisions to the
Andean Council of Foreign Ministers and the Commission, in accordance with
their respective spheres of responsibility, and initiatives and suggestions
to the enlarged meeting of the Andean Council of Foreign Ministers, aimed at
facilitating or hastening the fulfillment of this Agreement, so that its
objectives may be achieved within the shortest possible time frame;
d) To conduct studies and propose the necessary measures
for applying the special treatments in benefit of Bolivia and Ecuador and,
in general, those regarding the participation of the two countries in this
e) To study and report annually to the Andean Council of
Foreign Ministers and the Commission, on the results of the application of
this Agreement and the achievement of its objectives, paying special
attention to the fulfillment of the principle of fair distribution of the
benefits of integration, and to propose pertinent corrective measures;
f) To perform the technical studies and coordination
entrusted to it by other bodies of the Andean Integration System, together
with any others it considers necessary;
g) To maintain permanent working relations with the
Member Countries, in coordination with the national integration body
appointed by each country for that purpose;
h) To draw up its annual working program, in which it
shall give preference to the tasks assigned to it by other System bodies;
i) To promote periodic meetings of the national
organizations responsible for economic policy formulation or execution and,
particularly, those charged with economic planning;
j) To maintain working relations with the executive
bodies of other regional integration and cooperation organizations, in order
to strengthen their relationship and reciprocal cooperation;
k) To keep the records of the enlarged meetings of the
Andean Council of Foreign Ministers and of the Commission, and to draw up a
tentative agenda of their meetings, in coordination with the chairmen of
l) To be the depository for the records of the meetings
and other documents of Andean Integration System bodies and to certify their
m) To publish the Official Gazette of the Cartagena Agreement;
n) To act as Secretariat for the Meeting of Representatives of the
institutions that comprise the Andean Integration System; and,
�) To carry out all other responsibilities expressly
assigned to it by Andean Community Law.
Article 31.- The General Secretariat shall operate on a
permanent basis and its headquarters shall be located in the city of Lima,
Article 32.- The General Secretariat shall be headed by
a Secretary General who shall be chosen by consensus of the Andean Council of
Foreign Ministers for a five-year term of office and may be reelected a single
The Secretary General shall be a person with broad
representation and acknowledged prestige, and must be a national of one of the
Member Countries. He shall act only in the interests of the Subregion as a
The Secretary General may not carry out any other activity
during his term of office; nor shall he seek or accept instructions from any
government, national institution or international organization.
If the office falls vacant, the Andean Council of Foreign
Ministers, meeting in enlarged session, shall immediately proceed to appoint a
new Secretary General by consensus. Until that time, the Director-General with
the most seniority shall temporarily head the General Secretariat.
Article 33.- The Secretary General may be removed from
office by consensus, at the request of a Member Country, only if, in the
exercise of his duties, he commits the gross negligence foreseen in the
General Secretariat Regulations.
Article 34.- The responsibilities of the Andean
Community Secretary General are:
a) To act as the General Secretariat�s legal representative;
b) To propose initiatives in regard to the General
Secretariat Regulations to the Commission or to the Andean Council of
c) To hire and dismiss technical and administrative
staff, in accordance with the General Secretariat Regulations;
d) To participate with the right to be heard in the
sessions of the Andean Council of Foreign Ministers and the Commission and
in their respective enlarged meetings, and, when invited to do so, in the
meetings of other System bodies;
e) To present the draft annual budget to the Commission for its approval;
f) To present an annual report of the General
Secretariat�s activities to the Andean Council of Foreign Ministers meeting
in enlarged session.
Article 35.- The Secretary General, in consultation
with the Member Countries and in keeping with the General Secretariat�s
functional and organic structure, shall appoint the Directors-General. These
persons shall be top-level professionals, appointed strictly in accordance
with their academic background, suitability, reputation, and experience, and
they shall each be responsible for a specific technical area.
The Directors-General shall be nationals of Member
Countries and the Secretary General shall seek to ensure balanced subregional
geographic distribution in their appointment. The appointment and dismissal of
the Directors-General shall be governed by the General Secretariat
Article 36.- In proceedings where the interests of two
or more Member Countries are in dispute, the Secretary General shall enjoy the
technical assistance of special experts, whose appointment and method of
participation shall be determined according to the General Secretariat
Article 37.- The Secretary General, when hiring
technical and administrative staff, who may be of any nationality, shall bear
in mind strictly the ability, competence, and reputation of the candidates and
shall seek to ensure balanced subregional geographic distribution, provided
that this is compatible with the preceding criteria.
Personnel shall be appointed and dismissed according to the
criteria and grounds established in the General Secretariat Regulations,
without prejudice to what the establishing Treaty of the Court of Justice and
its amending protocols provide for.
Article 38.- The staff of the General Secretariat shall
refrain from taking any action that may be incompatible with the nature of
their duties and shall neither seek nor accept instructions from any
Government, national institution or international organization.
Article 39.- In the case of proceedings that should
conclude with the adoption of a Resolution or Opinion, public or private
individuals or legal entities from the Member Countries shall cooperate in
such investigations as the General Secretariat may make in carrying out its
duties and, in this sense, shall supply any information they are requested for
The General Secretariat shall keep any documents and
information furnished strictly confidential, in accordance with the rules
governing those matters.
Section E - On the Andean Community Court of Justice
Article 40.- The Court of Justice is the judicial
authority of the Andean Community.
Article 41.- The Andean Community Court of Justice is
governed by its establishing Treaty and its amending protocols and this
The Court has its headquarters in the city of Quito, Ecuador.
Section F - On The Andean Parliament
Article 42.- The Andean Parliament is the System�s
deliberating body. It has a community nature, represents the peoples of the
Andean Community and shall be made up of representatives chosen by universal
and direct suffrage, according to the procedure that is adopted through an
Additional Protocol that shall include adequate criteria for national
Until the Additional Protocol instituting direct elections
is signed, the Andean Parliament shall be comprised of representatives of the
National Congresses, in accordance with their internal regulations and the
General Regulations of the Andean Parliament.
The headquarters of the Andean Parliament shall be in the
city of Bogot�, Colombia.
Article 43.- The Andean Parliament�s responsibilities are:
a) To participate in the promotion and guidance of the
Andean Subregional integration process, with a view to consolidating Latin
b) To examine the progress of the Andean subregional
integration process and the fulfillment of its objectives, requesting
periodic information from the System bodies and institutions for that
c) To formulate recommendations regarding the annual
draft budgets of the System bodies and institutions that are financed
through the direct contributions of the Member Countries;
d) To suggest to the System bodies and institutions
actions or decisions, whose goal or effect is the adoption of modifications,
adjustments, or new general guidelines in relation to the programmed
objectives and institutional structure of the System;
e) To participate in the law-making process by suggesting
to the System bodies draft provisions on subjects of common interest, for
incorporation in Andean Community Law;
f) To promote the harmonization of Member Country legislation; and,
g) To promote cooperative and coordinated relations with
Member Country Parliaments, System bodies and institutions, and third
country parliamentary integration or cooperation bodies.
Section G - On the Advisory Institutions
Article 44.- The Business Advisory Council and the
Labor Advisory Council are the consultative institutions of the Andean
Integration System. They are comprised of high-level delegates, who shall be
directly elected by the representative organizations in the business and labor
sectors of each of the Member Countries, according to their respective
regulations, and officially accredited by them.
The responsibilities of the Advisory Councils shall be to
express their opinions to the Andean Council of Foreign Ministers, the
Commission or the General Secretariat, at the request of these bodies or on
their own initiative, with regard to programs or activities of the Andean
subregional integration process that are of interest to their respective
sectors. They can also be summoned to meetings of working groups and of
government experts involved in preparing draft Decisions, and may participate
in meetings of the Commission with the right to take part in the discussions.
Section H - On the Financial Institutions
Article 45.- The Andean Development Corporation and the
Latin American Reserve Fund are the System�s financial institutions and their
purpose is to promote the Andean subregional integration process.
Article 46.- The General Secretariat and the executive
bodies of the Andean Development Corporation and the Latin American Reserve
Fund shall maintain working relations for the purpose of coordinating
activities adequately and, thereby, facilitating the achievement of the
objectives of this Agreement.
Section I - On Dispute Settlement
Article 47.- The settlement of any disputes that may
arise as a result of the application of Andean Community Law shall abide by
the provisions of the Treaty establishing the Court of Justice.
Section J - On the International Legal Capacity and the
Privileges and Immunities
Article 48.- The Andean Community is a subregional
organization with an international legal capacity or status.
Article 49.- The General Secretariat, the Court of
Justice, the Andean Parliament, the Andean Development Corporation, the Latin
American Reserve Fund, and the Social Conventions that are part of the System
shall enjoy, within the territory of each of the Member Countries, the
privileges and immunities required for the fulfillment of their objectives.
Their representatives and international staff shall, likewise, be given the
privileges and immunities required to carry out their duties in relation to
this agreement with independence. Their premises are inviolable and their
goods and property are immune to all judicial proceedings, unless expressly
waived. Nevertheless, such a waiver shall not apply to any judicial measures
Article 50.- The Andean Council of Foreign Ministers
shall formulate the Common Foreign Policy on matters that are of interest to
the subregion. To that end, it shall coordinate joint political positions that
will enable the Community to participate effectively in international
political forums and organizations.
Article 51.- The Andean Council of Foreign Ministers
and the Andean Community Commission shall define and undertake to implement a
community strategy aimed at deepening integration with other economic blocs in
the region and establishing political, social and economic-trade relations
with other groups outside the region.
Article 52.- In order to accomplish the objective
stated in this Chapter, the Andean Council of Foreign Ministers and the Andean
Community Commission shall take the following measures, among others:
a) Strengthen community participation in international,
multilateral, hemispheric and regional economic and trade forums;
b) Coordinate joint negotiations of the Andean Community
with other integration processes or with third countries or groups of
c) Entrust the General Secretariat to perform research,
studies and activities that will make it possible to achieve the objective
and carry out the measures provided for in this Chapter.
HARMONIZATION OF ECONOMIC POLICIES AND COORDINATION
OF DEVELOPMENT PLANS
Article 53.- The Member Countries shall progressively
adopt a strategy to achieve the subregional development objectives envisaged
in this Agreement.
Article 54.- The Member Countries shall coordinate
their development plans in specific sectors and shall gradually harmonize
their economic and social policies, with a view to achieving the integrated
development of the area through planned actions.
This process shall be carried out simultaneously and in
coordination with the creation of the subregional market, by means of the
following mechanisms, among others:
a) Industrial Development Programs;
b) Agricultural and Agroindustrial Development Programs;
c) Physical Infrastructure Development Programs;
d) Intra-subregional Programs for the Liberalization of Services;
e) Harmonization of foreign exchange, monetary,
financial, and fiscal policies, including the treatment of subregional or
f) A common trade policy in relation to third countries; and
g) Harmonization of planning methods and techniques.
Article 55.- The Andean Community shall have a common
system for the treatment of foreign capital and on trademarks, patents,
licenses, and royalties, among other things.
Article 56.- The Andean Community shall have a uniform
regime that Andean multinational enterprises must abide by.
Article 57.- The Commission, at the General
Secretariat�s proposal, shall establish the necessary permanent procedures and
mechanisms for achieving the coordination and harmonization referred to in
Article 58.- The Commission, at the General
Secretariat�s proposal and taking into account the progress and needs of the
subregional integration process, as well as the balanced compliance with the
mechanisms of the Agreement, shall approve provisions and define timeframes
for the progressive harmonization of economic legislation and the instruments
and mechanisms for regulating and promoting the Member Countries� foreign
trade that affect the mechanisms provided for in this Agreement for the
creation of the subregional market.
Article 59.- The Member Countries shall provide in
their national development plans and in the formulation of their economic
policies for the necessary measures to ensure compliance with the preceding
INDUSTRIAL DEVELOPMENT PROGRAMS
Article 60.- The Member Countries bind themselves to
promote a joint industrial development process in order to attain the
following objectives, among others:
a) Expansion, specialization, diversification, and promotion of
b) Profitable use of economies of scale;
c) Optimum utilization of the resources available in the
area, particularly by industrializing the natural resources;
d) Improvement in productivity;
e) Closer relations, interlinkage and complementarity
among the sub region�s industrial enterprises;
f) Equitable distribution of benefits; and
g) Better international participation by subregional industry.
Article 61.- For purposes of the previous Article, the
following shall constitute modes of industrial integration:
a) Industrial Integration Programs;
b) Industrial Complementarity Agreements; and
c) Industrial Integration Projects.
Section A - On Industrial Integration Programs
Article 62.- The Commission, at the General
Secretariat�s proposal, shall adopt Industrial Integration Programs,
preferably to promote new industrial production lines that are sectoral or
intersectoral in scope, and in which at least four Member Countries shall
The programs shall include clauses dealing with:
a) Specific targets;
b) The determination of what products the Program will target;
c) The siting of production facilities in the countries
of the subregion whenever the characteristics of the sector or sectors
involved so require it, in which case, they shall include provisions on the
commitment not to encourage such production in countries that are not
favored by the allocation;
d) A Trade Liberalization Program that may provide for
different rates of implementation by country and by product;
e) A Common External Tariff;
f) Coordination of new subregion-wide investments and
measures to ensure their financing;
g) Harmonization of policies on aspects that affect the Program directly;
h) Complementary measures that may foster greater
industrial linkages and facilitate the fulfillment of Program goals; and
i) The timeframes during which the rights and obligations
arising from the Program shall be maintained in the event the Agreement is
Article 63.- A country that is not participating in an
Industrial Integration Program may request its incorporation at any time, in
which case the Commission shall approve the conditions for that incorporation,
through the voting system provided for in Article 26 b). Any negotiations that
may have been carried out between the participating countries and the
non-participant should be considered in the respective proposals.
Section B - On the Industrial Complementarity Agreements
Article 64.- The aim of Industrial Complementarity
Agreements shall be to promote industrial specialization among the Member
Countries. Such Agreements may be entered into and carried out by two or more
Countries and must be approved by the Commission.
For the purposes of the preceding paragraph, the Agreements
may include measures such as the distribution of production, joint production,
subcontracting of productive capacities, marketing agreements, and joint
foreign trade operations, as well as any other measures that may facilitate
closer coordination of the production processes and entrepreneurial activity.
Industrial Complementarity Agreements shall be temporary in
nature, and in addition to the determination of target products and of the
expiration date of the rights and obligations of the participating Member
Countries, may include special measures concerning tariff treatment, trade
regulation, and the establishment of preferential margins that are not
applicable to non-participant countries, provided that such measures represent
equal or better conditions than those existing for reciprocal trade. In that
case, the duties applicable to third countries shall be determined.
Article 65.- Countries that are not participating in
the Complementarity Agreements may request their incorporation at any time, in
which case the participating countries shall approve the conditions for that
incorporation, which shall be made known to the Commission.
Section C - On Industrial Integration Projects
Article 66.- The Commission shall approve Industrial
Integration Projects at the proposal of the General Secretariat. These
projects shall be carried out for specific products or product families
--preferably new ones--, through policies of collective cooperation and all of
the Member Countries shall be involved.
The following measures, among others, shall be taken for
the execution of these Projects:
a) Feasibility and design studies will be prepared;
b) Equipment, technical assistance, technology, and other
goods and services, preferably of subregional origin, will be supplied;
c) The support of the Andean Development Corporation will
be obtained, in the form of either financing or equity investment; and
d) Joint arrangements and negotiations will be carried
out with international entrepreneurs and government agencies to obtain
foreign funding or the transfer of technology.
Industrial Integration Projects shall include clauses that
deal with the siting of production facilities in the Member Countries whenever
the characteristics of the corresponding sector or sectors require it and may
include clauses to facilitate the access of products to the subregional
In the case of specific projects that are sited in Bolivia
or Ecuador, the Commission shall establish temporary and exclusive tariff
treatment to improve the terms of access by those products to the subregional
market. If products that are not produced in the Subregion are included in
this category, the terms of access shall provide for exceptions to the
principle of irrevocability stipulated in the first paragraph of Article 76.
Section D - Other Provisions
Article 67.- In applying the modes of industrial
integration, the Commission and the General Secretariat shall bear in mind the
situation and requirements of small and medium-sized industry, particularly
those concerning the following aspects:
a) The installed capacity of existing enterprises;
b) Financial and technical needs for the installation,
expansion, modernization, or conversion of production facilities;
c) The prospects for setting up joint marketing and technological
research systems and other forms of cooperation among similar enterprises;
d) Labor training requirements.
Article 68.- Industrial integration methods may provide
for industrial streamlining efforts aimed at making the most of the factors of
production and reaching higher levels of productivity and efficiency.
Article 69.- The General Secretariat may carry out or
promote cooperation efforts, including those aimed at industrial streamlining
and modernization in benefit of any activity in the sector, particularly of
small and medium-sized subregional industry, for the purpose of contributing
to the industrial development of the Member Countries. Priority shall be given
to carrying out these actions in Bolivia and Ecuador.
Article 70.- The General Secretariat, whenever it deems
it advisable and, in any case, in the course of its periodic evaluations,
shall propose to the Commission the measures it considers essential to ensure
the equitable participation of the Member Countries in the modes of industrial
integration that are covered in this Chapter, their execution, and the
attainment of their aims.
Article 71.- It shall be the responsibility of the
Commission and of the General Secretariat to coordinate appropriately with the
Andean Development Corporation, and to arrange for the assistance of any other
national or international institutions whose technical and financial
contribution it considers desirable for:
a) Facilitating policy coordination and joint investment
b) Channeling a growing volume of funds to resolve
problems created for Member Countries by the industrial integration process;
c) Promoting the financing of investment projects that
arise from the execution of the different modes of industrial integration;
d) Expanding, modernizing, or converting industrial
production facilities that may be adversely affected by trade
Article 72.- The purpose of the Liberalization Program
for goods is to eliminate duties and restrictions of all kinds levied on the
importation of products originating in the territory of any Member Country.
Article 73.- "Duties" are understood to be the customs
duties and any other charges with equivalent effects, whether of a fiscal,
monetary or foreign exchange nature, that may affect imports. Not included in
this concept are analogous assessments and surcharges that correspond to the
approximate cost of the services rendered.
"Restrictions of all kinds" are understood to mean any
administrative, financial, or foreign exchange measure whereby a Member
Country, through a unilateral decision, obstructs or hinders imports. Not
included in this concept are the adoption and enforcement of measures to:
a) Protect public morals;
b) Implement laws and regulations on security;
c) Regulate the import or export of weapons, ammunition,
and other war materials, and, under special circumstances, all other
military articles, provided that this does not interfere with the provisions
of treaties in force between Member Countries relating to the freedom of
d) Protect the life and health of human beings, animals, and plants;
e) Import and export metallic gold and silver;
f) Protect national treasures with an artistic,
historical, or archaeological value; and
g) Export, use and consume nuclear materials, radioactive
products, or any other material that may be employed for the development and
utilization of nuclear energy.
Article 74.- For the purposes of the previous articles,
the General Secretariat, on its own initiative or at the request of a party,
shall determine, when necessary, whether a measure adopted unilaterally by a
Member Country constitutes a "duty" or "restriction."
Article 75.- Products originating in a Member Country
shall enjoy, in the territory of another Member Country, treatment that is no
less favorable than that accorded to similar domestic products, insofar as
taxes, assessments and other domestic duties are concerned.
Article 76.- The Liberalization Program shall be
automatic and irrevocable and shall cover the entire product universe, save
for the provisions regarding exceptions that are established in this
Agreement, so that a total liberalization is achieved within the timeframes
and by the methods referred to in this Agreement.
This Program shall apply, in its various forms, to:
a) Products that are targeted by Industrial Integration Programs;
b) Products that are included in the Common List referred
to in Article 4 of the 1960 Montevideo Treaty;
c) Products on the corresponding list that are not
produced in any of the subregion�s countries; and
d) Products that are not covered in the above-cited sections.
Article 77.- Member Countries shall refrain from
levying customs duties and introducing restrictions of any kind on the
importation of goods that originated in the subregion.
Article 78.- Member Countries shall seek to jointly
reach partial-scope trade agreements, economic complementarity agreements,
agricultural agreements, and trade promotion agreements, with the other Latin
American countries in sectors where this is feasible, according to the
provisions of Article 86 of this Agreement and of the 1980 Montevideo Treaty.
INTRA-SUBREGIONAL TRADE IN SERVICES
Article 79.- The Andean Community Commission, at the
proposal of the General Secretariat, shall approve a general framework of
principles and provisions for liberalizing the intra-subregional trade in
Article 80.- The general framework provided for in the
previous article shall be applied to the trade in services provided in the
a) From the territory of one Member Country to the
territory of another Member Country;
b) Within the territory of a Member Country to a consumer
from another Member Country;
c) Through the commercial presence of service enterprises
of one Member Country in the territory of another Member Country; and,
d) By individuals from one Member Country in the
territory of another Member Country.
COMMON EXTERNAL TARIFF
Article 81.- The Member Countries commit themselves to
put a Common External Tariff into effect within the timeframes and according
to the modes the Commission may establish.
Article 82.- The Commission, at the General
Secretariat�s proposal, shall approve the Common External Tariff, which must
provide for adequate levels of protection for subregional products,
considering the Agreement objective of gradually harmonizing the different
economic policies of the Member Countries.
On the date indicated by the Commission, Colombia, Peru,
and Venezuela shall begin the process of aligning the customs duties that are
applicable under their national tariff schedules to the importation of
products that did not originate in the subregion, with the Common External
Tariff in an annual, automatic, and linear way.
Article 83.- The stipulations of Article 82
notwithstanding, the following provisions shall be applied:
a) With respect to products that are targeted by
Industrial Integration Programs, the rules established by those Programs
regarding the Common External Tariff shall govern; and with respect to
products that are targeted by Industrial Integration Projects, the
Commission, whenever appropriate, may specify, when approving the respective
Decision, the levels of customs duties that shall apply to third countries
and the corresponding terms; and
b) Whenever, in fulfilling the Liberalization Program, a
product is freed from customs duties and other restrictions, it shall be
subject to the full and simultaneous application of the customs duties
established in the Minimum Common External Tariff or in the Common External
Tariff, as the case may be.
In the case of goods that are not produced in the
subregion, each country may defer the application of the common customs duties
until the General Secretariat verifies that their production has begun in the
subregion. Even so, if in the General Secretariat�s judgment the new
production is insufficient to meet the normal needs of the subregion, it shall
propose to the Commission that it adopt the necessary measures to reconcile
the need to protect subregional production with that of ensuring a normal
Article 84.- The Commission, at the proposal of the
General Secretariat, may modify the common tariff levels to the extent and at
the time it deems advisable, in order to:
a) Adjust them to the subregion�s needs; and
b) Provide for the special situations of Bolivia and Ecuador.
Article 85.- The General Secretariat may propose to the
Commission the measures it considers essential to ensure normal supply
conditions in the subregion.
Any Member Country undergoing temporary supply shortages
may report the problem to the General Secretariat, which shall verify the
situation within a period commensurate with the urgency of the case. Once the
General Secretariat verifies the existence of the problem in question and so
informs the country adversely affected, the latter may take steps, such as to
temporarily reduce or suspend the External Tariff duties within the necessary
limits to correct the disturbance.
In the cases referred to in the previous section, the
General Secretariat shall call a special meeting of the Commission, if such is
in order, or shall inform it at its following regular meeting regarding the
action that has been taken.
Article 86.- The Member Countries commit themselves not
to unilaterally alter the customs duties set in the Common External Tariff.
They also agree to hold the necessary consultations within the Commission
before assuming tariff obligations with countries outside the subregion. The
Commission, at the General Secretariat�s proposal and through a Decision,
shall state its opinion regarding those consultations and shall establish the
terms with which tariff commitments must comply.
AGRICULTURAL DEVELOPMENT PROGRAMS
Article 87.- In order to boost common agricultural and
agroindustrial development and attain greater subregional food security, the
Member Countries shall carry out an Agricultural and Agroindustrial
Development Program, harmonize their policies, and coordinate their national
plans in this sector, bearing in mind the following objectives, among others:
a) To improve the standard of living of the rural population;
b) To take care to meet the food and nutritional
requirements of the population satisfactorily, in order to reduce to the
utmost dependence on supplies from outside the subregion;
c) To ensure the timely and adequate supply of the
subregional market and protect against the risk of food shortages;
d) To increase the production of staple foods and raise productivity
e) To ensure the complementarity and specialization of
the subregion�s production, with a view to improving the use of its inputs
and increasing the trade in agricultural and agroindustrial products; and
f) To replace the subregion�s imports and diversify and
increase its exports.
Article 88.- The Commission, at the proposal of the
General Secretariat, shall take the following steps, among others, to fulfill
the objectives stated in the previous article:
a) Create an Andean and National Food Security Systems;
b) Carry out joint agricultural and agroindustrial
development programs, by products or product groups;
c) Implement joint agricultural and agroindustrial
technological development programs that include technological research,
training, and transfer activities;
d) Promote intra-subregional agricultural and
agroindustrial trade and sign agreements to supply agricultural products;
e) Conduct joint programs and activities with regard to
agricultural and agroindustrial trade with third countries;
f) Establish and execute common provisions and programs
on plant and animal health;
g) Create subregional funding mechanisms for the
agricultural and agroindustrial sector;
h) Execute joint programs for the profitable use and
conservation of the sector�s natural resources; and
i) Implement joint cooperative technological research and
transfer programs in areas of common interest to the Member Countries, such
as genetics, floriculture, fishing, forestry, and any others the Commission
may decide upon in the future.
Article 89.- The Commission and the General Secretariat
shall take the necessary measures to step up the agricultural and
agroindustrial development of Bolivia and Ecuador, as well as their
participation in the enlarged market.
Article 90.- Any Member Country may apply
non-discriminatory measures to trade in the products added to the list
referred to in Article 92, for the purpose of:
a) Restricting imports to the absolute minimum needed to
cover shortages in domestic production; and
b) Bringing the prices of imported products into line with those of the
In order to implement such measures, the Member Countries
shall, when appropriate, take steps to supply agricultural and agroindustrial
food products through existing national agencies.
Article 91.- The country that imposes the measures
referred to in the previous article shall immediately notify the General
Secretariat, enclosing a report substantiating its action.
These measures shall be applied to Bolivia and Ecuador only
in duly qualified cases and after the General Secretariat has confirmed that
the damage is due essentially to their imports. The General Secretariat is
obliged to express its views within fifteen days after receiving the report
and may authorize the measures to be applied.
Any Member Country that considers itself affected by those
measures may present its objections to the General Secretariat.
The General Secretariat shall study the case and propose to
the Commission the positive measures it deems advisable in the light of the
objectives indicated in Article 87.
The Commission shall decide with respect to the
restrictions that were applied and the measures that are proposed by the
Article 92.- The Commission, at the proposal of the
General Secretariat, shall decide upon the list of agricultural products to
which Articles 90 and 91 may be applied, before December 31, 1970. The
Commission may modify that list at the proposal of the General Secretariat.
Article 93.- the Commission, before December 31, 1971
and at the General Secretariat�s proposal, shall adopt the essential
provisions to guard against or correct practices that may distort competition
within the subregion, such as dumping, improper price manipulations, maneuvers
to upset the normal supply of raw materials, and others with a like effect. In
this respect, the Commission shall consider the problems that could be created
by imposing duties and other restrictions on exports.
It shall be the General Secretariat�s responsibility to
ensure the application of those provisions to the particular cases that are
Article 94.- The Member Countries may not take
corrective measures without prior authorization from the General Secretariat.
The Commission shall regulate the procedures for implementing the provisions
contained in this Chapter.
Article 95.- Any Member Country that has taken measures
to correct an external imbalance may extend those measures, when authorized to
do so by the General Secretariat, temporarily and in a non-discriminatory way,
to intra-subregional trade in the products included in the Liberalization
The Member Countries shall seek to ensure that the
imposition of restrictions due to an adverse balance of payments situation
does not affect trade within the subregion in the products incorporated in the
If the situation envisaged in this Article requires an
immediate response, the Member Country involved may apply the foreseen
measures on an emergency basis. It shall report that action immediately to the
General Secretariat, which shall hand down its decision within the following
thirty days, either authorizing, modifying, or suspending those measures.
If the application of the measures provided for in this
Article continues for a period of over one year, the General Secretariat, on
its own initiative or at the request of any of the Member Countries, shall
propose to the Commission that negotiations be immediately initiated to seek
the removal of those restrictions.
Article 96.- If the implementation of the Agreement�s
Liberalization Program causes or threatens to cause serious economic damage to
a Member Country or to one of its key economic sectors, that country may, with
the prior authorization of the General Secretariat, take temporary and
non-discriminatory corrective steps. If necessary, the General Secretariat may
propose to the Commission that measures of collective cooperation be taken to
surmount the problems that have arisen.
The General Secretariat shall periodically study the
evolution of the situation to keep the restrictive measures from being imposed
any longer than is strictly necessary or to study new formulas for
cooperation, if appropriate.
If the damages dealt with in this Article are so serious
that they require immediate steps to be taken, the injured Member Country may
apply corrective measures temporarily, on an emergency basis, subject to the
subsequent decision of the General Secretariat.
Those measures should damage the Liberalization Program as
little as possible and, so long as they are implemented unilaterally, may not
involve reducing imports of the product or products in question to below the
average for the preceding twelve months.
Any Member Country that takes those measures shall
immediately report them to the General Secretariat and the latter shall issue
its decision within the following thirty days, either authorizing, modifying,
or suspending them.
Article 97.- If products that originated in the
Subregion are imported in such quantities or conditions as to disrupt a Member
Country�s production of specific products, that Country may take
non-discriminatory and temporary corrective measures, subject to the
subsequent decision of the General Secretariat.
A Member Country that takes corrective measures must notify
the General Secretariat within no more than sixty days and present a report
substantiating their application. The General Secretariat, within sixty days
after receiving that report, shall verify the existence of the disruption and
the origin of the imports that caused it and shall issue its decision, either
suspending, modifying, or authorizing those measures, which may be applied
only to the products of the Member Country where the disturbance originated.
The corrective measures that are taken shall guarantee the access of a volume
of trade amounting to no less than the average for the previous three years.
Article 98.- If a currency devaluation made by one of
the Member Countries alters the normal conditions of competition, the country
that considers itself to be adversely affected may bring the case before the
General Secretariat, which should hand down its decision briefly and
summarily. Once the General Secretariat has verified the existence of the
disturbance, the country that is adversely affected may take temporary
corrective measures so long as the condition exists, while abiding by the
General Secretariat�s recommendations. In any case, those measures may not
involve reducing imports to levels below those that existed prior to the
The application of the temporary measures referred to
notwithstanding, any Member Country may request the Commission to hand down a
final decision on the matter.
The Member Country that devalued its currency may ask the
General Secretariat to review the situation at any time, with a view to easing
or eliminating the cited corrective measures. The Commission may amend the
General Secretariat�s decision.
In the situation referred to in this Article, the country
which considers itself to be adversely affected may, in presenting the case to
the General Secretariat, propose protective measures that are commensurate
with the magnitude of the alleged disturbance, accompanied by the technical
substantiation of its proposal. The General Secretariat may request any
supplementary information it deems advisable.
The General Secretariat shall hand down its brief and
summary decision within a period of one month after receiving the request. If
it fails to do so within the stipulated period and the requesting country
feels that the delay may be harmful to its interests, it may take the initial
measures it had proposed; this action shall be immediately reported to the
General Secretariat, which shall decide whether the measures that have been
applied should be maintained, modified, or suspended.
In communicating its decision, the General Secretariat
shall bear in mind, among other criteria, the economic indicators regarding
the conditions of trade competition in the subregion adopted in general by the
Commission, at the General Secretariat�s proposal, the individual
characteristics of the Member Countries� foreign exchange systems and any
studies which the Monetary and Foreign Exchange Council may have made on the
The General Secretariat shall proceed according to its own
criteria until the Commission adopts the system of economic indicators.
Notwithstanding the foregoing, if, during the period
between the presentation in question and the General Secretariat�s decision,
in the opinion of the applicant Member Country, there are background elements
which give reasonable grounds to fear that the devaluation may cause immediate
harmful effects that may have serious implications for its economy that will
require the adoption of protective measures on an emergency basis, it may
present the situation to the General Secretariat; the latter, if it finds the
request to be well-grounded, shall have a period of seven continuous days in
which to authorize suitable measures to be taken. The General Secretariat�s
final decision regarding the disruption of the normal conditions of
competition shall, in any case, determine whether the authorized emergency
measures shall be maintained, modified, or suspended.
Measures that are adopted pursuant to this Article may not
involve reducing trade to levels below those that existed prior to the
The second and third paragraphs of this Article shall be
fully applicable to all of these measures.
Article 99.- No safeguard clauses of any kind shall be
applied to the importation of products originating in the subregion and
included in the Industrial Integration Programs and Projects.
Article 100.- The Commission, at the General
Secretariat�s proposal, shall adopt any special provisions that may be needed
to determine the origin of goods. Those rules shall constitute a dynamic
instrument for the subregion�s development and shall be appropriate for
helping to attain the Agreement�s objectives.
Article 101.- It shall be the General Secretariat�s
responsibility to establish the specific requirements of origin for the
products that require them. If an Industrial Integration Program necessitates
the establishment of specific requirements, the General Secretariat shall
determine those requirements as the corresponding program is being approved.
The Member Countries may request the General Secretariat to
review a specific requirement within a year after its establishment and its
decision must be communicated summarily.
If a Member Country so requests, the Commission shall
examine the requirements and hand down a final decision within six to twelve
months after their establishment by the General Secretariat.
The stipulation of the first paragraph of this article
notwithstanding, the General Secretariat may, at any time, either on its own
initiative or at the request of a party, establish or modify those
requirements in order to adjust them to the subregion�s economic and
Article 102.- In adopting and establishing the special
provisions or specific requirements of origin, as the case may be, the
Commission and the General Secretariat shall seek to ensure that they do not
hinder Bolivia and Ecuador from taking advantage of the benefits stemming from
the Agreement�s implementation.
Article 103.- The General Secretariat shall ensure
compliance with the rules and requirements of origin in subregional trade. It
shall, moreover, propose any measures that are necessary to resolve problems
of origin that obstruct the attainment of the objectives of this Agreement.
Article 104.- The Member Countries shall make a joint
effort to improve the use of the physical space and reinforce the
infrastructure and services that are needed to advance the subregion�s
economic integration. This effort shall be made primarily in the fields of
energy, transportation, and communications and shall cover the necessary
measures for facilitating cross-border traffic between the Member Countries.
To this end, the Member Countries shall seek to establish
multinational entities or enterprises whenever possible and desirable to
facilitate the execution and administration of those projects.
Article 105.- The Commission, at the General
Secretariat�s proposal, shall adopt programs in the fields cited to in the
preceding Article in order to promote a continuous process aimed at expanding
and modernizing the physical infrastructure and the transportation and
communications services of the subregion. These programs shall encompass the
following, insofar as possible:
a) The identification of specific projects for
incorporation in the national development plans and an indication of the
order of priority for their execution:
b) The essential measures for financing the necessary preinvestment
c) The technical and financial assistance needs to ensure
the execution of the projects; and
d) The joint action to be taken with the Andean
Development Corporation and the international lending institutions to ensure
that the required financial resources are provided.
Article 106.- The programs referred to in the foregoing
Article, as well as the Industrial Integration Programs and Projects, shall
include measures of collective cooperation to adequately cover the essential
infrastructure required for their execution and shall give special
consideration to the situation of Ecuador and Bolivia�s territorial and
Article 107.- The Member Countries shall take action
and coordinate their policies on financial matters and payments to the extent
necessary to facilitate the attainment of the Agreement�s objectives.
For that purpose, the Commission, at the General
Secretariat�s proposal, shall provide for the following actions:
a) Recommendations to channel the financial resources
through the appropriate bodies in order to meet the subregion�s development
b) Promotion of investments for the Andean integration programs;
c) Financing of trade among the Member Countries and
between them and countries outside the subregion;
d) Measures to facilitate the movement of capital within
the subregion and particularly the promotion of Andean multinational
e) Coordination of positions to strengthen the reciprocal
payments and lending mechanisms within the framework of ALADI;
f) Establishment of an Andean financing and payments
system that would encompass the Latin American Reserve Fund, a common unit
of account, trade credit lines, a subregional clearinghouse, and a system of
g) Cooperation and the coordination of positions to
handle the Member Countries� external financing problems; and
h) Coordination with the Andean Development Corporation
and the Latin American Reserve Fund for the purposes described in the
Article 108.- If a Member Country experiences problems
with its fiscal revenues as a result of the fulfillment of the Agreement�s
Liberalization Program, the General Secretariat may propose to the Commission,
at the request of the affected country, measures for resolving those
difficulties. The General Secretariat shall take into account in its proposals
the degrees of relative economic development of the Member Countries.
SPECIAL REGIME FOR BOLIVIA AND ECUADOR
Article 109.- Bolivia and Ecuador shall enjoy a special
regime, with a view toward gradually reducing the differences in development
that currently exist in the subregion. This system shall enable them to attain
more rapid economic growth through effective and immediate participation in
the benefits of the area�s industrialization and the liberalization of trade.
The bodies of the Agreement shall propose and take the
necessary measures to fulfill the aim of this Article, in accordance with its
Section A - On the Harmonization of Economic Policies and
the Coordination of Development Plans
Article 110.- In harmonizing the economic and social
policies and coordinating the plans referred to in Chapter IV, differential
treatments and sufficient incentives shall be established to compensate for
Bolivia and Ecuador�s structural weaknesses and ensure the mobilization and
allocation of the essential resources for attaining the objectives envisaged
in the Agreement for their benefit.
Section B - On Industrial Policy
Article 111.- The Industrial Development Programs shall
give special consideration to the situations of Bolivia and Ecuador in
assigning, on a priority basis, the production for their benefit and the
consequent siting of the production facilities in their territories,
particularly through their participation in the modes of industrial
integration stipulated in Article 58. It shall also provide for the
implementation of a program for the comprehensive industrialization of the two
countries� natural resources.
Article 112.- The Industrial Integration Programs and
Projects shall provide for exclusive benefits and effective preferential
treatment for Bolivia and Ecuador to help them take effective advantage of the
Article 113.- The General Secretariat, in proposing to
the Commission the complementary measures envisaged in Article 69, shall
provide for exclusive advantages and preferential treatment for Bolivia and
Ecuador, when necessary.
The Commission, at the General Secretariat�s proposal,
shall take the measures that are necessary to ensure that the allocations
granted to Bolivia and Ecuador are effective and fully utilized, particularly
those aimed at strengthening commitments in respect to the allocations made to
those countries, to the extension of the time periods for maintaining the
allocations, and to the execution of the projects assigned to them under the
Industrial Development Programs.
Section C - On Trade Policy
Article 114.- The corrective measures referred to in
Articles 90 and 96 shall be extended to imports from Bolivia and Ecuador only
in duly qualified cases and when the General Secretariat has been able to
ascertain that the serious adverse effects stem substantially from those
imports. In this case, the General Secretariat shall observe the procedures
stipulated in Articles 91 and 96 and the regulations adopted by the Commission
at the General Secretariat�s proposal with respect to the corresponding
Article 115.- The General Secretariat shall give
special and priority attention, in the cooperation efforts to which Article 69
refers, to the industries of Bolivia and Ecuador whose products are excluded
by those countries from their Liberalization Programs, in order to help equip
them to participate in the subregional market as rapidly as possible.
Section D - On The Common External Tariff
Article 116.- Bolivia and Ecuador shall begin the
process of adopting the Common External Tariff on an annual, automatic, and
linear basis, on the date set by the Commission.
Bolivia and Ecuador shall be required to adopt the Common
Minimum External Tariff for products that are not produced in the Subregion,
as referred to in Article 80. They shall adopt the minimum customs duties for
those products through a linear and automatic process that shall be completed
three years after the date on which these products are first produced in the
The stipulations of the first paragraph of this Article
notwithstanding, the Commission, at the proposal of the General Secretariat,
may determine that Bolivia and Ecuador should adopt the minimum tariff levels
for products of interest to the other Member Countries, provided that the
application of those levels is not detrimental to Bolivia or Ecuador.
The Commission, based on the evaluations referred to in
Article 131, shall determine the procedure and timeframe for the adoption of
the Common Minimum External Tariff by Bolivia and Ecuador. In any case, the
Commission shall bear in mind the problems deriving from Bolivia�s landlocked
situation referred to in Article 4 of this Agreement.
The Commission may also, at the General Secretariat�s
proposal, determine that Bolivia and Ecuador should adopt the minimum tariff
levels for products whose importation from outside of the subregion may cause
serious problems for the Subregion.
In drawing up its proposals on the Common External Tariff,
the General Secretariat shall bear in mind the provisions of Article 4
Article 117.- Bolivia and Ecuador may establish the
exceptions authorized by the Commission, at the General Secretariat�s
proposal, to the alignment of their national tariff schedules with the Common
External Tariff, to enable them to apply their existing industrial development
laws, mainly with respect to the importation of the capital goods,
intermediate goods, and raw materials they need for their development.
Those exceptions may not be applied in any case more than
two years before the Common External Tariff is fully implemented.
Section E - On Financial Cooperation and Technical
Article 118.- The Member Countries commit themselves to
act jointly to secure technical assistance and financing for Bolivia and
Ecuador�s development needs, particularly for projects related to the
integration process, from the Andean Development Corporation and any other
subregional, national, or international organizations.
The resources for those projects shall be allocated in
accordance with the basic objective of reducing the existing differences in
development among the countries by making an attempt to favor Bolivia and
The Member Countries, moreover, shall jointly request the
Andean Development Corporation to allocate its regular and special resources
in such a way that Bolivia and Ecuador are given a substantially larger share
than they would receive if the distribution were to be proportional to their
contribution to the Corporation�s capital.
Section F - General Provisions
Article 119.- In its periodic evaluations and annual
reports, the General Secretariat shall give separate and special consideration
to Bolivia and Ecuador�s situation in the subregional integration effort and
shall propose to the Commission the measures that it deems appropriate to
substantially improve their possibilities for development and increasingly
expedite their participation in the area�s industrialization.
Article 120.- The Commission may establish, for the
benefit of any of the relatively less developed countries, more favorable
conditions and procedures than those considered in this Chapter, in the light
of the degree of development attained and the conditions for taking advantage
of the benefits of integration.
ECONOMIC AND SOCIAL COOPERATION
Article 121.- Member Countries may undertake programs
and measures in the area of economic and social cooperation, which shall be
coordinated within the Commission and shall be limited to the spheres of
competence established in this Agreement.
Article 122.- Member Countries shall undertake external
efforts on matters of common interest, for the purpose of improving their
participation in the international economy.
Article 123.- With respect to the provisions of the
previous Article, the Andean Council of Foreign Ministers and the Commission
shall, within their respective areas of jurisdiction, adopt programs to direct
the joint external actions of the Member Countries, particularly as regards
the negotiations with third countries and groups of countries in the
political, social and economic and trade spheres, as well as their
participation in forums and organizations specialized in international
Article 124.- Member Countries shall promote a joint
scientific and technological development process to attain the following
a) The creation of a subregional capacity to respond to
the challenges of the scientific-technological revolution that is underway;
b) The contribution of science and technology to the
conception and execution of Andean development strategies and programs; and
c) The utilization of economic integration mechanisms to
incentivize technological innovation and the modernization of production.
Article 125.- For purposes of the previous Article, the
Member Countries shall adopt in the fields where there is a community
a) Programs of cooperation and coordinated efforts in
science and technology in areas where it is more effective to train human
resources and to obtain results from research at the subregional level;
b) Technological development programs that shall help to
obtain solutions to common problems in the production sectors, particularly
those aimed at enhancing the competitiveness of the different production
c) Programs for taking advantage of the enlarged market
and of joint physical, human, and financial capacities, in order to boost
technological development in sectors of community interest.
Article 126.- The Member Countries shall undertake
actions to promote the comprehensive development of border regions and their
effective incorporation in the national and subregional Andean economies.
Article 127.- The Member Countries shall conduct joint
tourism programs designed to gain a better understanding of the subregion and
to encourage economic activities connected with this sector.
Article 128.- The Member Countries shall undertake
joint actions to make better use of their renewable and non-renewable natural
resources and ensure the conservation and improvement of the environment.
Article 129.- The Member Countries shall make joint
cooperative efforts to help attain the following social development objectives
of the Andean people:
a) Elimination of poverty among the marginalized classes,
in order to achieve social justice;
b) Strengthening of the cultural identity and formation
of citizenship values for the integration of the Andean subregion;
c) Full participation by the subregion�s inhabitants in the integration
d) Attention to the needs of the predominantly rural depressed areas.
Programs and projects shall be carried out in the areas of
health, social security, low-cost housing, education, and culture, in order to
attain such objectives.
The various organizations of the Andean system shall
coordinate the actions that are taken pursuant to this Article.
Article 130.- For the purposes indicated in the
previous article, the respective Ministers of the social areas, meeting as an
Enlarged Commission, shall adopt the following in the fields of community
a) Educational programs aimed at renewing and improving
the quality of basic education;
b) Programs that seek to diversify and improve the
technical level and coverage of the professional training and job training
c) Programs aimed at securing the recognition of higher
educational degrees at the Andean level, in order to facilitate the
provision of professional services in the subregion;
d) People�s participation programs oriented toward
bringing about the full incorporation of the rural and semi-rural areas in
the development process.
e) Programs to promote social support systems and
projects, aimed at promoting the participation of small enterprises and of
networks of microenterprises and associative enterprises, interlinked within
the enlarged economic space;
f) Programs for promoting initiatives aimed at the
protection and well-being of the working population; and
g) Policy harmonization programs in the fields of women�s
participation in economic activity; of child and family protection and
support; and of attention to the ethnic groups and local communities.
Article 131.- The Member Countries shall take measures
in the area of social communication and action oriented toward disseminating a
fuller understanding of the subregion�s cultural, historical, and geographic
heritage, the economic and social situation of the subregion, and the Andean
Article 132.- The projects, measures, and programs to
which this Chapter refers shall be carried out simultaneously and in
coordination with the perfecting of the other mechanisms of the subregional
ADHERENCE, EFFECTIVE DATE AND DENOUNCEMENT
Article 133.- This Agreement may not be signed with
reservations and shall remain open to the adherence of the rest of the Latin
American countries. The relatively less economically developed countries that
adhere to the Agreement shall be entitled to a treatment similar to that
agreed upon in Chapter XV for Bolivia and Ecuador.
The Commission shall define the terms of adherence, bearing
in mind that the incorporation of new members must comply with the objectives
of the Agreement.
Article 134.- This Agreement shall become effective
when all of the Member Countries that sign it have deposited their respective
instruments of ratification with the Andean Community General Secretariat.
This Agreement may not be signed with reservations and
shall have an indefinite duration.
Article 135.- Any Member Country wishing to denounce
this Agreement shall so inform the Commission. From that moment on it shall
cease to enjoy the rights and have the obligations deriving from its status as
a Member, with the exception of the benefits received and granted in
accordance with the Subregional Liberalization Program, which shall remain
effective for a period of five years after the date of the denouncement.
The time period stipulated in the paragraph above may be
shortened in duly substantiated cases by decision of the Commission and at the
request of the interested Member Country.
Insofar as the Industrial Integration Programs are
concerned, the stipulation of Article 62 paragraph i) shall be applied.
Article 136.- The Andean Council of Foreign Ministers
meeting in enlarged session may, at the proposal of the Andean Commission,
with the interested country having expressed its will, confer the status of
Associate Member on a country that has entered into a free trade agreement
with the Andean Community Member Countries.
Article 137.- Upon granting a country the status of
Associate Member, the Andean Council of Foreign Ministers and the Andean
Community Commission shall, in keeping with their respective spheres of
competence and after having heard the opinion of the General Secretariat,
define the following through the adoption of a Decision:
a) The bodies and institutions of the Andean Integration
System to which the Associate Country shall belong, together with the terms
for its participation;
b) The mechanisms and measures of the Cartagena Agreement
in which the Associate Member Country shall participate; and
c) The provisions that shall be applied to the relations
between the Associate Member Country and the rest of the Member Countries,
as well as the way those relations shall be administered.
The aspects provided for in this article may be revised at
any time, in keeping with the procedures and spheres of competence stipulated
Article 138.-The Commission, at the proposal of the
General Secretariat, and based upon the latter�s periodic reports and
evaluations, shall adopt the necessary mechanisms to ensure the attainment of
the objectives of the Agreement once the process of trade liberalization and
establishment of the Common External Tariff has concluded. Those mechanisms
must provide for special treatment favoring Bolivia and Ecuador so long as the
present differences in degree of development continue to exist.
Article 139.- Any advantage, favor, exemption,
immunity, or privilege that is applied by a Member Country to a product
originating in or destined for any other country, shall be immediately and
unconditionally extended to the similar product originating in or destined for
the territory of the other Member Countries.
Advantages, favors, exemptions, immunities, and privileges
already granted or to be granted by virtue of agreements among Member
Countries or between Member Countries and third countries, for the purpose of
facilitating border traffic, shall be excepted from the treatment referred to
in the previous paragraph.
First.- The stipulations of Article 76 of the Cartagena
Agreement notwithstanding, the Andean Community Commission shall define the
terms of the Liberalization Program to be applied to the trade between Peru
and the rest of the Member Countries, with a view to having the Andean Free
Trade Area fully operational by December 31, 2005 at the latest. Peru shall
not be obliged to apply the Common External Tariff until the Commission
decides on the timeframes and ways and means for Peru�s incorporation in this
Second.- The Member Countries shall provisionally apply
the stipulations of the Chapter on Associate Members and the First Temporary
Provision until the ratification procedures required by their respective
national laws have been completed.
Third.- The Andean Community Commission may establish
an arbitrational mechanism to settle disputes among Member Countries that
extend beyond the General Secretariat�s decision.
Fourth.- Alterations in the tariff level resulting from
Ecuador�s conversion of its National Customs Tariff due to the adoption of the
Brussels Tariff Nomenclature, are excepted from the stipulations of Article
Fifth.- The Commission may situate the products covered
by Decision 120, once it has been derogated, in any of the modes of the
Liberalization Program; it may also add them to the new reserve list referred
to in the Second Temporary Provision.
1. To delegate to the General Secretariat the attributions it deems
2. To approve the draft amendments to this Agreement.
3. To amend the General Secretariat�s proposals.
4. To approve the provisions that are needed to make it possible to
coordinate the development plans and harmonize the economic policies of the
5. To approve the provisions and define the timeframes for
gradually harmonizing the Member Countries� instruments to regulate foreign
6. To approve the physical integration programs.
7. To accelerate the Liberalization Program, by products or product groups.
8. To approve the joint agricultural and agroindustrial
development programs, by products or product groups.
9. To approve and modify the list of agricultural products to which Article
10. To approve the measures for joint cooperation established in Article
11. To approve, not approve, or amend Member Country proposals.
12. To reduce the number of subject matters included in this Annex.
13. To establish the terms for adherence to this Agreement.
14. To approve the Common External Tariff in accordance
with the modes provided for in Chapter VIII, establish the terms for its
application and modify the common tariff levels.
15. To approve the measures referred to in the last
paragraph of Article 91.
1. To approve the terms for the incorporation for
non-participant Member Countries in the Industrial Integration Programs.
2. To approve the list of products that are not produced in
any country of the Subregion.
3. To approve the special rules of origin.