JUSFTA 2018-06-21T08:44:34+00:00

Jordan – U.S. Free Trade Agreement

The U.S.-Jordan Free Trade Agreement (FTA), signed on October 24, 2000 and entered into force on December 17, 2001. Jordan and the US also have a Bilateral Investment Treaty. These agreements provide Jordanian exports with a comparative advantage in the large US market and helps boost foreign direct investment from the United States.

President Clinton and King Abdullah II signed the JUSFTA on October 24, 2000.
Source: SUSAN A. WALSH/AP

At the time, it was the first U.S. FTA with an Arab country. Currently the US also has FTAs with Bahrain, Morocco and Oman, which came as part of the U.S. Middle East Free Trade Area Initiative (MEFTA initiative) first proposed in May 2007. The MEFTA initiative “is a plan of graduated steps for Middle Eastern nations to increase trade and investment with the United States and with others in the world economy, with the eventual goal of a regional free trade agreement.

https://ustr.gov/trade-agreements/other-initiatives/middle-east-free-trade-area-initiative-mefta

Side by Side Comparison of U.S. FTA with Arab Courtiers:

Provisions

Jordan

Bahrain

Morocco

Oman

Agreement Name US-Jordan Free Trade Area US-Jordan Free Trade Area US-Jordan Free Trade Area US-Jordan Free Trade Area
Implementation Date December 17, 2001 August 1, 2006 January 1, 2006 January 1, 2009
Expiration None None None None
Duty Phase-Out January 1, 2010 (10 years) January 1, 2015 (10 years) January 1, 2023 (18 years) January 1, 2018 (10 years)
Merchandise Processing Fee
(MPF)
Not exempted Exempt for originating goods; Not exempted Exempt for originating goods;
19 Code of Federal Regulation (CFR) 24.23(c)(9) 19 Code of Federal Regulation
(CFR) 24.23(c)(11)
Direct Shipment
Imported Directly
Transit & Transshipment
Third Country Transportation
Imported Directly: May NOT enter the
commerce of a 3rd country except for non-retail sale where the importation is the result of the original transaction, may not undergo further
production in a 3rd country; GN
18(c)(vi); 19 CFR 10.711
Imported Directly: May leave customs’ control, may not undergo further production in a 3rd country, limited operations specified; GN 30(d)(v); 19 CFR 10.817 Imported Directly: May leave
customs’ control, may not undergo
further production in a 3rd country,
limited operations specified; GN
27(d)(v); 19 CFR 10.777
Imported Directly: May leave
customs’ control, may not undergo
further production in a 3rd country;
GN 31(d)(v); 19 CFR 10.880
Primary Responsibility for
Compliance
Importer Importer Importer Importer
Rule of Origin citation General Note 18(b)
19 CFR 10.709, 10.710
General Note 30(b)
19 CFR 10.810
General Note 27(b)
19 CFR 10.770
General Note 31(b)
19 CFR 10.873
Rule of Origin “Wholly the growth, product, or
manufacture” or Value Content +
Substantial Transformation
“Wholly the growth, product, or
manufacture” or Value Content + 19
CFR 102 or Product-Specific Tariff
shift
“Wholly the growth, product, or
manufacture” or Value Content + 19
CFR 102 or Product-Specific Tariff
shift
“Wholly the growth, product, or
manufacture” or Value Content +
Substantial Transformation or
Product-Specific Tariff shift



https://www.cbp.gov/document/forms/side-side-comparison-free-trade-agreements-and-selected-preferential-trade

United States has 14 FTAs in force with 20 countries. U.S. FTA Partner Countries: Australia; Bahrain; Chile; Colombia; DR-CAFTA: Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, & Nicaragua; Israel; Jordan; Korea; Morocco; NAFTA: Canada & Mexico; Oman; Panama; Peru; and Singapore.

Promoting trade is a key aspect of Jordan’s economic development policy. The Jordan U.S. FTA represents a milestone in the development of Jordan’s trade policy. Jordan has been a member of WTO since 11 April 2000, and has signed multiple bilateral and multilateral FTAs with its major trading partners.

The table below lists Jordan’s current FTAs:

Agreement

Date of Signature

Date of Entry into Force

Greater Arab Free Trade Agreement (GAFTA) 19 Feb. 1997 1 Jan. 1998
Jordan-EU Association Agreement 24 Nov. 1997 1 May 2002
Jordan-US Free Trade Area Agreement 24 Oct. 2000 17 Dec. 2001
Jordan-EFTA Free Trade Agreement 21 June 2001 1 Jan. 2002
Agadir Agreement 25 Feb. 2004 6 July 2006
Jordan-Singapore Free Trade Agreement 16 May 2004 22 Aug. 2005
Jordan-Turkey Free Trade Agreement 1 Dec. 2009 1 Mar. -2011
Jordan Canada Free Trade Agreement 28 Jun. 2009 1 Oct. 2012
Source: http://rtais.wto.org/

http://mit.gov.jo/EchoBusV3.0/SystemAssets/PDFs/EN/Departments/ForeignTradePolicy/Greater%20Arab%20Free%20Trade%20Area.pdf

Jordan continues to pursue ongoing liberalization with key partners, this includes the establishment of a “Deep and Comprehensive Free Trade Areas” with the EU, and negotiations with Mexican and Pakistan.

Brief of the FTA Provisions:

The Free Trade Agreement has seven major sections:

• Tariff Elimination: The FTA provided for the gradual eliminate of tariffs on virtually all trade between the two countries within a10 years, which came into full effect by 2010. The table below provides of the schedule of tariff elimination.

Removal of tariffs between Jordan and the U.S. as per the FTA

2000 Tariff level (%)

Phase-out period (by 2010)

2000 Tariff level (%) Phase-out period (by 2010)
<5 2 years
5 – 10 4 years
10 – 20 5 years
>>20 10 years

• [1]JUSFTA Fact Sheet 2000


• Services:

Jordan already enjoys near complete access to the U.S. services market. The FTA will open the Jordanian services market to U.S. companies. Specific liberalization has been achieved in many key sectors, including energy distribution, convention services, printing and publishing, courier services, audiovisual, education, environmental, financial, health services, tourism, and transport services.

• Intellectual property rights :

These provisions incorporate the most up-to-date international standards for copyright protection. Among other things, Jordan has undertaken to ratify and implement the World Intellectual Property Organization’s (WIPO) Copyright Treaty and WIPO Performances and Phonograms Treaty within two years. These two treaties, sometimes referred to as the “Internet Treaties,” establish several critical elements for the protection of copyrighted works in a digital network environment, including creators’ exclusive right to make their creative works available online.

• Electronic commerce :

For the first time in a free trade agreement, Jordan and the U.S. have each committed to promoting a liberalized trade environment for electronic commerce that should encourage investment in new technologies and stimulate the innovative uses of networks to deliver products and services. Both countries agreed to seek to avoid imposing customs duties on electronic transmissions, imposing unnecessary barriers to market access for digitized products, and impeding the ability to deliver services through electronic means.

• Labor provisions :

For the first time in a U.S. trade agreement, rather than in a side agreement, the Jordan FTA includes in the body of the agreement key provisions that reconfirm that free trade and the protection of the rights of workers can go hand in hand. These provisions reaffirm the parties’ support for the core labor standards adopted in the 1998 International Labor Organization’s Declaration on Fundamental Principles and Rights at Work. The countries also reaffirmed their belief that is inappropriate to lower standards to encourage trade, and agreed in principle to strive to improve their labor standards. Each side agreed to enforce its own existing labor laws and to settle disagreements on enforcement of these laws through a dispute settlement process.

• Environmental provisions :

Again, for the first time in the body of a free trade agreement, the Jordan FTA includes a separate set of substantive provisions on trade and the environment. Specifically, each country agreed to avoid relaxing environmental laws to encourage trade. The United States and Jordan affirmed their belief in the principle of sustainable development, and agreed to strive to maintain high levels of environmental protection and to improve their environmental laws. Each side also agreed to a provision on effective enforcement of its environmental laws, and to settle disagreements on enforcement of these laws through a dispute settlement process. Both countries are conducting environmental reviews, which were extremely useful in developing some of the provisions of the agreement.

The United States and Jordan also agreed on an environmental cooperation initiative, which establishes a U.S.-Jordanian Joint Forum on Environmental Technical Cooperation for ongoing discussion of environmental priorities, and identifies environmental quality and enforcement as areas of initial focus.

The environmental elements of the FTA package also include language on transparency and public input, and on environmental exceptions. Finally, the FTA includes a “win/win” initiative — an initiative that is good for both business and the environment by eliminating tariffs on a number of environmental goods and technologies and liberalizing Jordanian restrictions on certain environmental services.

• Consultation and dispute settlement :

The United States envisions most questions on the interpretation of the agreement or compliance with the agreement being settled by either informal or formal government-to-government contacts. The FTA provides for dispute settlement panels to issue legal interpretations of the FTA, but only if the countries have first consulted and failed to resolve the dispute. The process includes strong provisions on transparency. The report of such dispute settlement panels is non-binding, and the affected country is authorized to take appropriate measures if the parties are still unable to resolve a dispute once a panel has issued its recommendations.


Text of the Jordan – US Free Trade Agreement

Annex 2.1: Tariff Elimination (the complete U.S. and Jordanian tariff schedules, total of 800 pages)

• United States Tariff Schedule
Link: https://www.usitc.gov/tata/hts/index.htm

Hashemite Kingdom of Jordan Tariff Schedule
Link: https://services.customs.gov.jo/JCcits/sections.aspx

Website of Jordan Customs: https://www.customs.gov.jo

General Notes to the U.S Tariff Schedule

Annex to the General Notes to the US Tariff Schedule

• Schedule of the United States of America

• Jordanian Schedule

General Notes to the Jordanian Tariff Schedule

• Schedule of the Hashemite Kingdom of Jordan

Annex 2.2: Rules of Origin

Annex 2.3: Article 2

Annex 3.1: Services Schedules

Annex 3.2: U.S. – Jordan Understanding Concerning Certain Reciprocity Requirements

Joint Statements and MOUs

Side Letters