Free Trade Agreements
Summary of the U.S. - Morocco Free Trade Agreement
Status: Implemented on January 1, 2006
**The information presented on this website is meant to serve as a guide.
Only the agreement text and the customs regulations issued to implement the agreement
are definitive. For complex issues or where interpretation is required, U.S. exporters should seek legal assistance or an advanced ruling from the customs administration in the country to which they are exporting.**
If you have any questions about this Agreement, please contact Maria D'Andrea-Yothers
at the U.S. Department of Commerce Office of Textiles and Apparel at 202-482-1550 or by email.
How U.S. Textile and Apparel Companies Benefit
Through duty elimination, the U.S.-Morocco FTA allows U.S. textile, apparel, footwear and travel goods exporters to be more price-competitive in the Moroccan market when competing with domestic suppliers and with third country suppliers that do not have duty benefits. Through the elimination of a variety of non-tariff barriers, the FTA further opens the Moroccan market to U.S. products. The FTA affords substantial benefits in a broad range of service sectors; enhances the protection of intellectual property; facilitates U.S. investments through predictable access and a stable business environment; and provides for open and fair government procurement.
Under the FTA, duties on the majority of qualifying U.S. textile and apparel products entering into Morocco have been eliminated or will be eliminated in stages by January 1, 2011. All qualifying products will be duty-free by January 1, 2015. The duty-free status and/or staged tariff rates are listed by HS number in the Tariff Elimination Schedule of Morocco. (For importing goods from Morocco to the United States, see the Tariff Elimination Schedule of the United States.) Each line item of the FTA tariff schedules is assigned a letter code that indicates the staging by which the duty for each product is reduced and ultimately eliminated. The staging categories listed below generally apply to textile and apparel products in HS chapters 50-64. U.S. footwear and travel goods exported to Morocco fall into Category F where duties will be eliminated in nine equal stages beginning January 1, 2006, and will be duty free effective January 1, 2014.
See Textiles and Apparel Chapter 4 of the Agreement for more details on the tariff elimination, as well as the exceptions listed below.
- Category A: Goods were duty-free immediately upon the date that the FTA entered into force, i.e., January 1, 2006.
- Category D: Duties were reduced by fifty percent on January 1, 2006. Beginning January 1, 2007 duties were reduced in five equal annual stages, and became duty-free effective January 1, 2011.
- Category F: Duties will be eliminated in nine equal stages beginning January 1, 2006, and will be duty free effective January 1, 2014.
- Category H: Duties will be eliminated in ten stages. On January 1, 2006, duties were reduced by three percent of the base rate, and by an additional three percent of the base rate on January 1 of years 2007, 2008 and 2009. Beginning on January 1, 2010, duties will be reduced in six equal annual stages and products shall be duty-free effective January 1, 2015
Also see ITA's FTA Tariff Tool to determine current and future tariffs for qualifying products, as well as the date on which products are duty-free.
Tariff-Rate Quotas on certain apparel and made up goods--The U.S.- Morocco FTA contains a provision that allows for duty free treatment for certain originating goods (listed in Annex 4-B, page 45 of the Agreement), subject to annual limits. Such goods in excess of the limits are subject to Category D staging until January 1, 2011, at which time they will be duty free. To view the list of goods subject to this provision, please see Annex 4-B, page 45 of Textiles and Apparel Chapter 4 of the Agreement.
Tariff Preference Levels (TPL)--The U.S.- Morocco FTA allowed for a certain quantity of fabric and apparel that did not meet the rules of origin to come in under a preferential tariff rate. These limited allowances for the use of yarn and fabric from a nonparty, referred to as TPL, allowed U.S. fabric and apparel exporters some flexibility in their inputs. The TPL was set at an initial level of 30,000,000 square meters equivalent (sme) for the first four years and was reduced over the next six years and eliminated on January 1, 2016. Any non-originating goods that exceed the quantity limits were subject to the non-preferential (i.e., MFN) rate of duty. Now that the TPL has expired, all trade under the FTA must adhere to the yarn-forward rule of origin. The TPL applied to both FTA partner countries. The TPL quantities for the U.S.-Morocco FTA are listed below. (See Article 4.3, par. 9-11, page 6 of Textiles and Apparel Chapter 4 of the Agreement for more details).
|Year Following Date of Entry into Force of this Agreement||Combined Annual Quantities in Square Meter Equivalents (SME)|
See the U.S. Customs and Border Protection document, Morocco FTA Textile and Apparel TRQs and TPLs, which explains the difference between "originating" goods eligible for a TRQ and "non-originating" goods eligible for a TPL.
Limited Cumulation for Cotton--The FTA also contains a special allowance for U.S. and Moroccan industries to use cotton fibers from least-developed sub-Saharan African countries. Preferential tariff treatment is allowed for certain textile and apparel goods (listed in Annex 4-A of the Agreement) that do not meet the rules of origin, but contain cotton fiber, classified in HS heading 5201.00, that originates in one or more of the least developed sub-Saharan African countries designated in Article 6 of the Bulletin Officiel, No. 4861 bis -6 chaoual 1421 (1.2001), certains pays d'Afrique, as of the date of the entry into force of this Agreement. Goods containing such cotton and provided that the cotton fibers are carded or combed in the territory of a Party or of a designated least developed country may be accorded preferential tariff treatment up to 1,067,257 kilograms annually.
Qualifying Products/Rules of Origin
In order to take advantage of the duty reduction/elimination, products must qualify as "originating" goods under the terms of the Agreement. In general, the product must have sufficient U.S. or Moroccan content or processing to meet the criteria.
Rules of Origin for Textile and Apparel Products:
For textile and apparel products, goods containing only U.S. or Moroccan inputs qualify. Goods containing inputs from other countries still might qualify if they meet specific criteria set out in Chapter 5 - Rules of Origin of the Agreement. Textile and apparel products are subject to specific rules, based on tariff classification (see Chapter 5 - Rules of Origin).
The rules for textile and apparel products are generally referred to as "yarn forward," which requires that the yarn production and all operation forward occur in either Morocco or the United States, but the fiber may be from anywhere. There are some exceptions in the rules requiring "fiber forward," and some requiring "fabric forward".
If a good does not meet the rule of origin requirements as indicated above, a textile or apparel product might be considered originating if all non-originating fibers and yarns make up less than a "de minimis" seven percent of the total weight of the product. Special provisions also apply to textile and apparel goods put up in sets for retail sale. To see more details on these provisions, see Textiles and Apparel Chapter 4 of the Agreement (Article 4.3 - Rules of Origin and Related Matters, page 4).
Rules of Origin for Non-Textile Footwear and Travel Goods:
The direct costs of the processing operations performed and value of each material produced in the territory of Morocco, the United States, or both, must be at least 35% of the appraised value of the good. Also, the article must be substantially transformed such that it is a new or different article.
(Note:Textile travel goods are included under HS numbers: 4202.12, 4202.22, 4202.32, and 4202.92; textile footwear and footwear parts are included under HS numbers: 6405.20, 6406.10 and 6406.99.)
For more information, see the U.S. Customs and Border Protection presentation--How do I Read Tariff Shift Rules.
For qualifying goods, in which U.S.-Morocco FTA duty benefits are requested, the importer must make a claim of preference. The Agreement does not require that the importer provide a certificate of origin in support of the claim of preference. However, both the importer and the exporter have obligations to generate supporting documentation to back-up any claims of preferential treatment under the U.S.-Morocco FTA.
To make a claim for preferential tariff treatment for a good, the importer must submit to the customs authority of the importing Party, on request, a signed declaration setting forth all pertinent information concerning the growth, production, or manufacture of the good. A requested declaration may require the following details:
Moroccan customs officials may verify a claim of preferential treatment up to five years after the date of importation. Therefore, it is recommended that importers and exporters maintain documents relating to the importation of the good and all supporting documents for at least five years.
- a description of the good, quantity, numbers, and invoice numbers and bills of lading
- a description of the operations performed in the growth, production, or manufacture of the good in the territory of one or both of the Parties and, where applicable, identification of the direct costs of processing operations
- a description of any materials used in the growth, production, or manufacture of the good that are wholly the growth, product, or manufacture of one or both of the Parties, and a statement as to the value of such materials
- a description of the operations performed on, and a statement as to the origin and value of, any materials used in the good that are claimed to have been sufficiently processed in the territory of one or both of the Parties so as to be materials produced in the territory of one or both of the Parties, or are claimed to have undergone an applicable change in tariff classification specified in Annex 4-A or Annex 5-A
- a description of the origin and value of any foreign materials used in the good that are not claimed to have been substantially transformed in the territory of one or both of the Parties, or are not claimed to have undergone an applicable change in tariff classification specified in Annex 4-A or Annex 5-A.
For information on common export documents, such as transportation documents, export compliance documents, certificates of origin, certificates for shipments of specific goods, temporary shipment documents, and other export-related documents, see the Export.gov webpage on Common Export Documents.
Measures to Prevent Circumvention of the Agreement’s Rule of Origin
The U.S. Morocco FTA, as with other recent free trade agreements signed by the United States, contains additional measures to ensure that textile and apparel goods are not subject to fraud, such as transshipment. The parties agree that the exporting Party, at the request of the importer Party, shall conduct verification procedures to determine that a claim for origin of a textile and apparel good is accurate, allows the exchange of information between parties when suspicion occurs, and permits the importing party to suspend preferential tariff treatment to the textile and apparel good under suspicion or any textile and apparel good produced or exported by a specific company. (For further information, please see Article 4.4 - Customs and Administrative Cooperation, page 8 of the Textiles and Apparel Chapter 4 of the Agreement for more details).
Measures to Prevent Serious Damage, or Actual Threat Thereof, to the Domestic Industry
The FTA allowed either party to re-impose MFN tariffs if imports from the other party damage domestic production. This provision expired on January 1, 2016.
Intellectual Property Rights (IPR): The FTA’s strong anti-piracy provisions mandate both statutory and actual damages under Moroccan law for IPR violations. Under these anti-piracy provisions, monetary damages can be awarded even when it is difficult to determine the actual amount of economic harm. Each government also commits to granting and maintaining the right for authorities to seize, forfeit, and destroy counterfeit and pirated goods and the equipment used to make them. The agreement also requires each government to provide criminal liability for internet piracy, even if there is no motivation of financial gain. Under its FTA obligations, Morocco will offer increased IPR protection and enforcement for copyrights, trademarks, geographical indications, patents, and undisclosed test data.
Product Standards and Technical Regulations:
As a result of commitments made in the FTA, Morocco has improved transparency in it government rule making. The FTA builds on WTO obligations, which Morocco has applied to improve the transparency of its government rule-making process. In particular, Morocco now invites foreign participation and comment in the development of standards, technical regulations, and conformity assessment procedures. In addition, Morocco includes explanations of how external comments have been treated in the final drafting.
The United States-Morocco FTA requires the use of fair and transparent procurement procedures, including advance notice of purchases and timely and effective bid review procedures for procurement covered by the Agreement. Under the FTA, U.S. suppliers are permitted to bid on procurements for most Moroccan central government entities, as well as the vast majority of Moroccan regional and municipal governments, on the same basis as Moroccan suppliers. The anticorruption provisions in the FTA require each government entity to ensure that bribery in government procurement is treated as a criminal offense or is subject to comparable penalties.