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Country Commercial Guide for U.S. Companies

Chapter 5: Trade Regulations and Standards

International Copyright, U.S. Department of State, 2012. All rights reserved outside of the United States.

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In this chapter

Import Tariffs

As a member of the Central American Common Market (CACM), Nicaragua applies a harmonized external tariff on most items at a maximum of 15% with some exceptions. Approximately 95% of tariff lines are harmonized at this rate or lower. In response to rising prices, in 2007, Nicaragua issued a series of decrees to unilaterally eliminate or reduce to 5% tariffs on many basic foodstuffs and consumer goods. These decrees have been extended every six months and are currently in effect through June 30, 2012. The Nicaraguan Customs Authority maintains an online database of import tariffs, including tariffs applicable under CAFTA-DR.

Under CAFTA-DR, approximately 80% of U.S. industrial and consumer goods now enter Nicaragua duty-free, with remaining tariffs phased out by 2015. Nearly all textile and apparel goods that meet the Agreement's rules of origin now enter Nicaragua duty-free and quota-free, promoting new opportunities for U.S. and regional fiber, yarn, fabric, and apparel manufacturing companies.

More than half of U.S. agricultural exports now enter Nicaragua duty free thanks to CAFTA-DR. Nicaragua will eliminate its remaining tariffs on nearly all agricultural goods by 2025, including those on pork, rice, and yellow corn. Nicaragua will eliminate its tariffs on chicken leg quarters and rice by 2023 and on dairy products by 2025. For certain products, such as poultry leg quarters, tariff-rate quotas (TRQs) allow duty free access for increasing quantities as tariffs are phased out. Nicaragua will liberalize trade in white corn through expansion of a TRQ, but there is no tariff phase out.

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Trade Barriers

The U.S. Embassy receives numerous reports from U.S. businesses and nongovernmental organizations that the Nicaraguan Customs Authority regularly subjects shipments of commercial and even donated goods to bureaucratic delays and arbitrary valuation. Importers and exporters alike accuse customs officials of regularly assessing exorbitant fines for minor administrative discrepancies on paper work. In some cases, shipments are illegally held for days, weeks, months or even years, with no justification provided by customs agents. The U.S. Embassy rarely has success in obtaining information from the Nicaraguan Customs Authority concerning these cases.

The government levies a selective consumption tax (ICS) on many items, as described in Chapter 3 of the Country Commercial Guide: Selling U.S. Products and Services. The tax is not applied exclusively to imports, but imports are taxed on the cost, insurance, and freight value, while domestic goods are taxed on the manufacturer's price. All alcoholic beverages and tobacco products are taxed on the price charged to the retailer.

For motor vehicles, the Nicaraguan Customs Authority levies the ICS according to engine size. New and used automobiles with engines greater than 4000 cc face a tax of 30%, while those with engines less than 4000 cc pay 25%, 3000 cc pay 20%, 2,600 cc pay 15% and less than 1,600 cc pay 10%. U.S. cars with larger engines may face stiff price competition from manufacturers of small cars. The ISC is applied to other motor vehicles based on engine size as well.

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Import Requirements and Documentation

An importer must present the following documentation to the Nicaraguan Customs Authority:

  • bill of lading
  • packing list
  • original invoice
  • declaration of invoice authenticity
  • permits issued by Nicaraguan authorities (if necessary, see below)
  • certificate of origin (to determine applicability of CAFTA-DR and other trade agreements)

Importers must also register as a taxpayer with the Nicaraguan Tax Authority. Once they have their tax identification number, they must register it with the Nicaraguan Customs Authority, Legal Affairs Division, which also requires importers to present proof of fiscal solvency on a monthly basis.

The process for sending donations to Nicaragua is to request authorization from the Ministry of Foreign Relations. The donating organization may wish to hire a local customs broker familiar with local customs procedures in order to ensure that the donation is not lost. Customs may seize a shipment if it is not removed from their warehouses after 20 days, but the importer can pay a fine in order to avoid it being auctioned off.

Food and Beverages

  • If a product is imported in bulk and packaged in Nicaragua, a phytosanitary or sanitary certificate is required from the country of origin and the Nicaraguan Ministry of Health, Food Inspection Office.

Medicines and Cosmetics

  • The Ministry of Health, Pharmaceutical Office, issues import permits for medicines, cosmetics and hygiene products. Importers must present documentation demonstrating safety and effectiveness and pay fees to obtain a sanitary registration, plus as well as fees for laboratory analysis (this fee varies if the products are made in Nicaragua). To ascertain fee amounts, please contact the Ministry of Health.

For more information on registering a product or the documents required for importing pharmaceutical products, please contact:

Ministerio de Salud
Dirección de Farmacias
Complejo Nacional de Salud "Dra. Concepción Palacios" costado oeste, Colonia Primero de Mayo, Módulo 4, Managua
Tel: (505) 2289-4700, ext. 222
Fax: (505) 2289-4401
div-far@minsa.gob.ni

Laboratorio Nacional de Control de Calidad de Medicamentos
Donde fue la Pepsi 2 c. al Sur, 3 c. Abajo, Managua
Tel: (505) 2244-1925
lnccm-cndrminsa@hotmail.com

Agriculture and Livestock

Telecommunications

Containers for Liquefied and Compressed Gasses

  • The Fire Department, Fire Prevention Office, issues import permits for new and used cylinders or containers for liquified or other compressed gases.

Firearms

  • The National Police, Firearms and Ammunition Office administers an import permit system for firearms, ammunition, and explosives under the Special Law for Control and Regulation of Firearms, Ammunition, Explosives, and Related Materials (amended 2006/591).

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U.S. Export Controls

U.S. firms must secure a permit from the U.S. Department of State, Directorate of Defense Trade Controls, to export arms and ammunition to Nicaragua. For exports of other sensitive goods that may have both commercial and military uses, U.S. firms must seek authorization from the U.S. Department of Commerce, Bureau of Industry and Security.

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Temporary Entry

Under the National Treatment and Market Access for Goods Chapter of CAFTA-DR, Nicaragua must provide duty-free temporary admission for products such as professional equipment, goods for display or demonstration, and commercial samples. The Chapter also includes specific provisions on the international transit of vehicles and containers.

The Ministry of Development, Industry and Trade, through the National Export Commission is responsible for administering Nicaragua's Temporary Admission Law, which defines the circumstances under which merchandise may be imported duty free, primarily in the case of re-export after a transformative process, repair, or alteration. This law only applies to companies that directly or indirectly export at least 25% of total production (no lower than US $ 50,000 per year). The Nicaraguan Customs Authority is responsible for applying this law, and additional information is available by writing to cnpe@mific.gob.ni.

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Labeling and Marking Requirements

The Nicaraguan Technical Standard on Prepackaged Foods for Human Consumption (1999/03-021) requires that prepackaged foods be labeled in Spanish and indicate product origin, contents, price, weight, production date, and expiration date. The Ministry of Development, Industry and Trade, Standards Office, will determine if the product complies with the labeling requirements, once the product has been registered with the Sanitation Office at the Ministry of Health.

The Ministry of Health, Pharmaceutical Office, requires that pharmaceutical products be packaged and labeled in Spanish for retail distribution and that their dosages be clearly indicated.

For those companies that are interested in participating in government tenders, sample products must be submitted with the required labels in Spanish.

Nicaragua is a signatory of the Cartagena Protocol on Biosafety. As mandated by the protocol, Nicaragua requires that agricultural goods containing more than 5% living modified organisms (LMOs) be labeled to indicate that they "may contain" LMOs.

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Prohibited and Restricted Imports

The Ground Transportation Law (2005/524) prohibits the import of motor vehicles that are more than 10 years old, with the exception of antique cars and donations to the fire department, Red Cross, and religious organizations.

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Customs Regulations and Contact Information

The Customs Administration and Trade Facilitation Chapter of CAFTA-DR establishes rules designed to encourage customs transparency, predictability, and efficiency. Under the agreement, Nicaragua must promptly publish its customs measures, including on the Internet. Nicaragua must also release goods from customs promptly and expeditiously clear express shipments.

The Central American Uniform Customs Code establishes harmonized customs procedures for Guatemala, El Salvador, Nicaragua, and Honduras, including uniform documents, electronic transmission of customs information, and electronic prepayment of charges, tariffs and taxes.

Importers must use the services of a licensed customs broker. Nicaragua applies the World Trade Organization Agreement on Customs Valuation to determine customs duties. Many importers report, however, that the Nicaraguan Customs Authority misclassifies goods in order to apply a higher duty rate. They also allege that officials apply arbitrary reference prices. Several U.S. companies have reported having property stolen from a bonded warehouse at the port of Corinto, while port authorities and Customs officials refuse to intervene. Information on current customs regulations can be obtained from the Nicaraguan Customs Authority at Tel: (505) 2249-5719 or (Fax) 505-2249-5720 (fax).

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Standards

Overview
Standards Organizations
Conformity Assessment
Accreditation
Publication of Technical Regulations

Overview

The Technical Barriers to Trade Chapter of CAFTA-DR requires that Nicaragua build on the WTO Agreement on Technical Barriers to Trade to promote transparency, accountability, and cooperation on standards and regulatory issues.

Standards Organizations

The Technical Standards and Quality Law (1996/219) establishes a National Standards and Quality Commission, including public and private sector members, to develop standards and regulations. The Ministry of Development, Industry and Trade, Technology, Standards, and Measurement Office, serves as secretariat for the commission.

NIST Notify U.S. Service
Member countries of the World Trade Organization (WTO) are required under the Agreement on Technical Barriers to Trade (TBT Agreement) to report to the WTO all proposed technical regulations that could affect trade with other Member countries. Notify U.S. is a free, web-based e-mail subscription service that offers an opportunity to review and comment on proposed foreign technical regulations that can affect your access to international markets. Register online at Internet URL: http://www.nist.gov/notifyus/

Conformity Assessment

The Technical Barriers to Trade Chapter of CAFTA-DR requires that Nicaragua recognize conformity assessment bodies located in the United States on terms equivalent to those located in Nicaragua. Conformity assessment in Nicaragua is limited to export products such as coffee and peanuts.

Product Certification

The Ministry of Development, Industry and Trade, National Accreditation Office, publishes technical standards and requirements governing standards certifying organizations.

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Acreditation

The Technical Standards and Quality Law (1996/219) establishes the Ministry of Development, Industry and Trade, National Accreditation Office, as the government entity responsible for accrediting standards certifying organizations.

The Technical Standards and Quality Law (1996/219) establishes the Ministry of Development, Industry and Trade, National Accreditation Office, as the government entity responsible for accrediting standards certifying organizations.

Publication of Technical Regulations

The Ministry of Development, Industry and Trade, Technology, Standards, and Measurement Office, publishes Obligatory Nicaraguan Technical Standards as well as Standards Subject to Public Consultation.

Labeling and Marking

Many of the standards requirements for labeling and marking in Nicaragua can be found in the Consumer Defense Law (1994/182), or by contacting the Ministry of Development, Industry and Trade, Technology, Standards, and Measurement Office.

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Contacts

The Ministry of Trade, Industry, and Development, Technology, Standards, and Measurement Office employs the following contacts:

  • Department of Standards and Measurements
    Telephone: 505-2267-4551 Ext. 1276
    Email: dtnm@mific.gob.ni
  • Department of Standards
    Head of the Standards Department
    Telephone: 505-2267-4551 Ext. 1238

  • CODEX Alimentarius Point of Contact
    Telephone: 505-2267-4551 Ext. 1258
    Email: codex@mific.gob.ni
  •  Information Center on Technical Barriers to Trade
    Telephone: 505-2267-4551 Ext. 1230

The U.S. Department of Commerce’s International Trade Administration employs a regional expert in standards, based in Mexico City:

Commercial Officer/Standards Attaché
Office of Standards Liaison for Canada, the Caribbean, Central America and Mexico
Telephone: 52-55-5140-2603

Trade Agreements

Nicaragua, along with Costa Rica, El Salvador, Guatemala, Honduras, and the Dominican Republic, signed the Central America - Dominican Republic - United States Free Trade Agreement (CAFTA-DR) in August 2004. The agreement entered into force for Nicaragua and the United States on April 1, 2006.

The Secretariat for Central American Economic Integration (SIECA) provides technical and administrative support to Nicaragua, Costa Rica, El Salvador, Guatemala, and Honduras in their efforts to establish a Central American Common Market. Nicaragua has signed bilateral trade agreements with Chile, the Dominican Republic, Panama, Mexico, and Taiwan. In 2010, Central American countries, including Nicaragua, signed a trade agreement with the European Union.  Nicaragua, along with Honduras, Guatemala and El Salvador, remains in the process of negotiating a free trade agreement with Canada, a process begun in 2001.

The Ministry of Development, Industry and Trade, International Trade Office, is responsible for the negotiation and implementation of trade agreements.

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