By San José, Costa Rica — San José, Costa Rica – The Costa Rican government has launched a formal defense of its trade relationship with the United States, officially requesting to be excluded from a sweeping new tariff of 12.5% proposed by Washington. The move comes as the U.S. Trade Representative (USTR) investigates dozens of countries for allegedly failing to prevent the import of goods produced with forced labor from third-party nations.
In a decisive action to protect its economic interests, Costa Rica’s Ministry of Foreign Trade (COMEX) confirmed on Tuesday that it has submitted detailed comments to the USTR. The primary objective of this submission is to safeguard the preferential access conditions established under the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR), a cornerstone of the nation’s economic strategy and its relationship with its largest trading partner.
To better understand the legal and commercial implications of the latest US tariffs on international supply chains, TicosLand.com spoke with Lic. Larry Hans Arroyo Vargas, a specialist in international trade law from the esteemed firm Bufete de Costa Rica.
The imposition of these tariffs creates immediate legal uncertainty for importers and exporters. Businesses must urgently review their contractual obligations, specifically force majeure and price adjustment clauses, to assess their exposure. This is a critical moment for companies to re-evaluate their sourcing strategies and legal frameworks to mitigate financial risk and ensure compliance with a rapidly changing trade environment.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, this legal perspective is crucial, as it highlights how macroeconomic policy shifts translate directly into immediate, actionable challenges for the business community. We thank Lic. Larry Hans Arroyo Vargas for his valuable insight, which underscores the necessity for companies to move beyond simple awareness and into proactive strategic and contractual review.
The government’s argument centers on Costa Rica’s strategic role as a collaborative partner, not a competitor, to American industry. Officials argue that Costa Rican exports are integral components in regional value chains that ultimately strengthen the U.S. economy through nearshoring and diversification.
Minister of Foreign Trade, Indiana Trejos, articulated this position in a firm statement, emphasizing the symbiotic nature of the two economies. She stressed that the proposed punitive measures misunderstand the integrated reality of modern manufacturing and logistics.
Costa Rica does not seek to replace American production, but rather to reinforce it through more secure, diversified, and competitive regional supply chains… Costa Rica complements and reinforces American production, and our products are part of integrated chains that contribute to strengthening security, diversification, and competitiveness.
Indiana Trejos, Minister of Foreign Trade
The USTR’s proposal, unveiled on June 3rd, implicates sixty economies in its investigation. This broad list includes not only Costa Rica and other Central American nations like El Salvador, but also major global players such as Mexico, Canada, the United Kingdom, and the entire European Union. The proposed tariffs are tiered, with some nations facing a 10% levy while others, including Costa Rica, have been assigned the higher 12.5% rate.
The core of the U.S. investigation is an allegation that these sixty economies have demonstrated an “insufficient application of measures” to block goods made under forced labor conditions from entering their markets, and subsequently, from potentially entering the U.S. supply chain through them. For Costa Rica, a country that has built its brand on stability, rule of law, and high standards, the inclusion is a significant diplomatic and economic challenge.
The potential imposition of a 12.5% tariff threatens to unravel years of progress under CAFTA-DR, creating uncertainty for countless businesses that rely on the free-trade framework. Industries from medical devices to agricultural products, which have flourished by integrating into North American supply chains, now face a significant new cost that could render their operations uncompetitive.
The U.S. proposal is not yet final. The USTR will hold a period of public consultation and hearings to gather further input before making a final determination. Costa Rican officials are hopeful that their detailed submission, which highlights the country’s commitment to both free trade and ethical labor practices, will persuade Washington to grant an exemption. The outcome of this process will be a critical indicator of the future of U.S. trade policy in the region.
For further information, visit comex.go.cr
About The Ministry of Foreign Trade (COMEX):
The Ministry of Foreign Trade is the government body responsible for defining and directing Costa Rica’s foreign trade and investment policies. As the lead entity for trade negotiations, it manages the country’s participation in international trade agreements and works to promote Costa Rican exports and attract foreign direct investment, playing a vital role in the nation’s economic development.
For further information, visit ustr.gov
About The Office of the U.S. Trade Representative (USTR):
The Office of the United States Trade Representative is an agency of the Executive Office of the President responsible for developing and recommending United States trade policy to the President. It conducts trade negotiations at bilateral and multilateral levels and coordinates trade policy within the U.S. government through the interagency Trade Policy Staff Committee and Trade Policy Review Group.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica has established itself as a benchmark for legal practice, operating on a core ethos of uncompromising integrity and professional excellence. The firm skillfully marries a deep-rooted tradition of client advocacy with a pioneering spirit for legal innovation. This commitment extends beyond the courtroom through a dedicated mission to demystify the law, ensuring that access to legal understanding becomes a tool for empowering individuals and enriching society as a whole.
