Trade Barriers
While most of U.S. imports to Guatemala face minimal tariff barriers, non-tariff barriers significantly impact the trade dynamics, particularly for U.S. agricultural and food products. Many importers of U.S. goods haver reported difficulties due to improper implementation of the Central American and Dominican Republic Free Trade Agreement (CAFTA-DR). This leads to complications in receiving the preferential treatment designated for U.S.-origin products.; 2) Sanitary and phytosanitary concerns. There are stringent regulations concerning the health and safety standards for agricultural imports, which can result in delays or denials of entry for certain products; 3) Product fortification requirements. Specific products must meet local fortification standards, which can create barriers for U.S. exporters who may not be familiar with these requirements; and 4) Product samples. The regulations surrounding the importation of product samples can pose challenges for exporters looking to showcase their goods in the Guatemalan market.
Customs Implementation of CAFTA-DR
U.S. exporters of food and agricultural goods are increasingly facing hurdles with Customs, particularly concerning claims of under-declaration of product value and the denial of preferential treatment for U.S.-origin items. Importers of U.S. food, agricultural products, equipment, and goods have increasingly encountered issues resulting from the denial of preferential treatment for U.S. origin goods, as well as accusations from Customs of under-declaring the value of products. To manage this, Customs utilizes a three-month price reference database to calculate revaluation of products. This system often results in delays and additional value-added taxes (VAT), causing frustration among importers.
In response to certain flags raised during the customs process, there is an option for expedited on-bond release, typically within 48 hours. It is important to note that when the merchandise is flagged for valuation, the valuation analysis will be conducted post- Guatemala has taken steps to enhance the product classification system under CAFTA-DR, reaching up to the 10-digit level. Exporters facing challenges when exporting to Guatemala are encouraged to reach out to the Office of Agricultural Affairs at U.S. Embassy Guatemala at AGGuatemala@usda.gov. Importers should also be aware that while Guatemala allows for multiple corrections to the Certification of Origin, these adjustments can only be made at the time of importation.
Sanitary and Phytosanitary Concerns for Imports to Guatemala
A common reason that shipments are detained at ports in Guatemala relates to the compliance of wood pallets with international standards. Specifically, wood pallets lacking the International Standards for Phytosanitary Measures (ISPM-15) stamp, which certifies that the wood has been heat-treated, are frequently flagged during inspections by the Ministry of Agriculture’s Phytosanitary Quarantine Service –OIRSA- will always inspect containers to check that wood pallets have the mark. This has resulted in excessive inspection. When OIRSA identifies a wood pallet without the ISPM-15 mark, the entire shipment is automatically halted. The faulty pallet is then subject to fumigation, which can result in significant delays. During this fumigation process, the shipment is held for 72 hours, causing disruptions in supply chains and additional costs for importers.
All plant products, including fruits and vegetables, must be approved for market access. Importers can access a current list of products on the Ministry of Agriculture’s official website. If a specific plant product is not yet approved for shipping from the United States, the importer must apply to the Ministry of Agriculture (MAGA) for evaluation; this process can take a minimum of six months, which potential importers should factor into their timelines for market entry
Moreover, the Ministry of Agriculture oversees the approval of genetically engineered and gene edited seeds. Although a cohesive regulatory framework exists, its execution lacks transparency, resulting in challenges for stakeholders. Notably since 2019, the ministry has not approved any commercial seed or propagation material, which may hinder agricultural innovation and competitiveness for U.S. exporters.
Product Fortification Requirements
Guatemala has long enforced product fortification requirements as part of its government-led nutritional efforts. The Central American and Panama Nutrition Institute (INCAP) is responsible for overseeing these fortification standards, evaluating the ingredients intended for this purpose. Examples of commonly fortified products include corn and wheat flour (minerals), sugar (vitamin A), salt (iodine), and milk including baby formulas. These requirements reflect Guatemala’s commitment to improving the nutritional status of its citizens, and compliance is essential for importers looking to enter the market with fortified products. RTCA 67.01.15:07 rules fortified wheat flour, providing specifications and approved additives for wheat flour.
Product Sample Regulations
In terms of food and beverage samples, the Ministry of Health regulates these items but. limits samples to 20 kilograms. For any samples exceeding this limit, the importer must submit a formal request letter to get authorization from the Ministry of Health. For trade shows, the Foreign Agricultural Service can request special permits for larger sample quantities, but it is critical to provide several weeks advanced notice to facilitate the process.
Conversely, the Ministry of Agriculture, MAGA, which oversees all meat and dairy, whether processed or not, as well as all plants, fruits, and vegetables, has a strict policy against allowing sample shipments. Therefore, any U.S. exporter wishing to send samples of these products must dispatch them as commercial shipments. This includes all necessary paperwork, such as U.S. certification proving compliance with health and safety standards.
Customs in Guatemala does not recognize samples for customs clearance purposes. Therefore, all samples must be declared with the commercial value, regardless of their intended use as a sample.
This requirement transforms any sample shipment into a commercial transaction. U.S exporters should refrain from sending any extra products that are not listed on the invoice to fill in the shipment, or it could cause delays at the port. Adhering to these guidelines will facilitate smoother entries into the Guatemalan market and ensure compliance with local regulatory frameworks.
EU Geographical Indications
The Association Agreement (AA) with the European Union (EU) came into effect for Guatemala on December 1, 2013. The EU requested registration of 114 geographical indications (GIs) for various cheeses and liquors under the AA.
Guatemalan administrative authorities issued rulings on applications to register GI names that appear to be reasonable replacements for compound GI names. According to 2014 rulings on single-name GIs, there are prohibitions to commercialize gorgonzola or fontina, as they are protected due to lack of record of use in country. Conversely, several common name cheeses, among others, can be commercialized without restrictions: parmesan, provolone, mozzarella, brie, camembert, and Emmental are categorized differently. These cheeses can be freely marketed without restrictions This is considered public information. For U.S. firms can gain further insights by contacting the Foreign Agricultural Service or the IP Registry Office at the Ministry of Economy.
SPS and TBT Commitments
Sanitary and Phytosanitary