It’s pop quiz time!
What was the first Free Trade Agreement (FTA) entered into by the United States?
If you said the United States-Israel FTA, you’re correct! Also referred to as the Israel FTA, this agreement continues to serve as the foundation for expanding trade and investment between the United States and Israel.
Here are some interesting facts about our trade relationship with Israel via the Office of the U.S. Trade Representative:
- Israel was the United States' 21st largest goods export market in 2016.
- As of 2016, U.S. goods and services trade with Israel totaled $47.1 billion.
- U.S. goods exports to Israel in 2016 totaled $13.2 billion, which was up 485% from 1984 (pre-FTA).
- The top export categories (two-digit HS code) in 2013 were precious stones—diamonds ($5.1 billion), electrical machinery ($1.6 billion), machinery ($1.4 billion), aircraft ($1 billion), and optic and medical instruments ($653 million).
The U.S. - Israel Free Trade Agreement
The U.S.-Israel FTA was signed into legislation more than 30 years ago. For exports to Israel, this FTA can reduce the tariff to zero by eliminating nearly all tariffs and administrative import licensing requirements.
In order to qualify under the U.S.-Israel FTA your goods must:
- Be grown, produced or manufactured in the U.S. and contain at least 35% U.S. content (materials and labor), and
- Be imported directly from the U.S. into the customs territory of Israel.
Changes to the U.S. - Israel FTA Certificate of Origin
Until April 1, 2018, U.S. exports to Israel that included goods that qualified under the FTA rules of origin required a green COO form. That requirement has now changed and the COO has been replaced by the U.S. Origin Invoice Declaration that must appear on a commercial document—typically the commercial invoice.
This new statement must be signed by the exporter or producer of the goods, depending on who can prove that the goods qualify as duty free under the terms of the agreement. For more information about this change and the full text of the U.S. - Israel FTA, visit the U.S. Trade Agreement Compliance website.
Shipping Solutions has added a new version of the commercial invoice that includes this new declaration to its export documentation and compliance software. Click here to sign up for a free online demonstration of the Shipping Solutions software.
This post was originally published in May 2016 and has been updated to include current information, links and formatting.