With the entry into force of this agreement, a wider and more secure market for goods and services produced in the aforementioned markets was created. This, recognizing the differences in levels of development and size of the economies.
Its aim is to stimulate the expansion and diversification of trade; this is why tariffs on all goods originating in signatory nations will be deleted. In that sense, Dominican exports benefit from preferential tariffs in markets in the US, Puerto Rico and Central American countries (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua).
For some goods tariffs are phased out, establishing categories and periods of tariff reductions of 5, 10, 15 and 20 years to reach zero duty; there are different relief periods by product and country of the Treaty. The products manufactured in companies established in the free zone regime are beneficiaries of the Agreement.
This agreement legislates aspects related to hygienic production and environmental protection, respect for intellectual property rights and public and private investment, as well as all labor legislation in the States of the CAFTA area. It also specifies the mechanisms to settle disputes and to establish regulations.
CAFTA aims to encourage the growth and diversification of trade in the region, eliminate obstacles and barriers to trade, increase investment opportunities and facilitate the movement of goods and services. The entry of the treaty eliminated 80% of the rates remaining 20%, which will gradually disappear over a period of 10 years from the signing.
The DR-CAFTA, replaced the application of rate preferences granted by the Commercial Law Association of the United States with the countries of the Caribbean Basin (CBTPA) and the Generalized System of Preferences (GSP).