The Brazilian Government will inform the Chilean Government, in accordance with Article 29 of the Agreement on Maritime Transport between Brazil and Chile, of its decision to denounce the accord so that it will not be renewed. By this measure, the agreement will expire at the end of January 7, 2020. The communication will implement the July 25 deliberation of the Chamber of Foreign Trade (CAMEX).
The agreement, which establishes the preference for Brazilian and Chilean flag vessels in maritime cargo transportation between the two countries (known as ‘cargo reserve’), entered into force in 1975 and has been renewed ever since. Once the agreement expires, the maritime transportation of goods between the two countries will be carried out by vessels of any flag.
The adoption of this measure will open maritime cargo transportation between Brazil and Chile to more competition and shall reduce its costs, thus raising the competitiveness not only of companies directly involved in bilateral trade, but also of those that use raw materials that are exported and imported by both countries. The termination of the agreement will also promote greater integration of productive processes of companies established in Brazil and Chile.
Additionally, CAMEX has decided to extend the period of validity of cargo reserve waivers for ‘roll on-roll off’ and ‘break bulk’ maritime transport methods, in view of the reduced availability of Brazilian and Chilean flag vessels in these categories.
As it prepares the full liberalization of the maritime cargo transport between the two countries, CAMEX's decision, by setting a known and fixed expiration date to the agreement, provides users and operators of the bilateral maritime transportation with predictability and legal security, to the benefit of an increasingly appropriate business environment.