Costa Rica Wins More Time To Implement CAFTA

by Mike Godfrey, Tax-News.com, Washington

01 October 2008

Costa Rica has been given an additional three months to complete the legislative process that will enable the country to join the Central American Free Trade Agreement (CAFTA).

The news that Costa Rica's CATFA partners had granted the extension was announced by President Oscar Arias following his meetings with fellow Central American leaders and the US President George W. Bush in New York last week.

Although CAFTA was ratified by Costa Rican voters almost a year ago, the Constitutional Court ruled that the Legislative Assembly should not have passed legislative changes affecting the country's intellectual property regime without consulting indigenous groups.

While the legislative assembly has completed work on a dozen other pieces of enabling legislation, ratification cannot be completed until the IP provision is redrafted and approved, a process which could take between 6 weeks and three months from the date of the Constitutional Court's judgment on September 11.

It marks the second occasion that Costa Rica has been granted an extension to the deadline for ratification of CAFTA, having been granted an extra six months to complete the legislative process in February 2008. Arias is nonetheless optimistic that ratification can be completed prior to the US presidential election on November 4. However, this depends on the final bill passing through the assembly without another appeal to the Constitutional Court, which could delay the process further still.

Costa Rica remains the only signatory to the trade pact not to have completed ratification.

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