Colombia and Brazil extend for one year the suspension of tariffs on vehicles in bilateral trade

The governments of Colombia and Brazil agreed to extend for one year the suspension of tariffs applicable to trade in vehicles and auto parts between the two countries.

The decision was formalized on November 7, 2025, before the Latin American Integration Association (ALADI), in Montevideo, through a joint document that consolidates the commitment of both nations to maintain the current conditions while a comprehensive review of the bilateral automotive agreement is carried out.

The new understanding, entitled 'Understanding between the governments of the Federative Republic of Brazil and the Republic of Colombia on the deepening of bilateral tariff preferences in the automotive sector', establishes that the suspension will continue to be in effect for an additional twelve months, starting from November 1, 2025. During that period, vehicles and auto parts traded between the two countries will continue to enter with zero tariff.

This extension falls under Economic Complementation Agreement No. 59 (ACE-59), which regulates tariff preferences between the member countries of Mercosur and the Andean Community. Since 2017, Colombia and Brazil have maintained a special regime that allows free trade in automobiles under conditions of reciprocity and specific quotas.

The Colombian delegation to ALADI explained that the extension aims to guarantee stability in the automotive sector, protect jobs, and facilitate an orderly transition to a new framework for productive integration. The document emphasizes that both governments recognize the importance of the automotive sector in strengthening bilateral economic relations and commit to maintaining ongoing technical and political dialogue.

The text also details that, during this additional year, the foreign trade authorities of both countries will evaluate the impact of the current regime, review the lists of products benefiting from it, and analyze possible adjustments to promote a more balanced trade. The intention is to move toward strengthening bilateral tariff preferences to boost regional competitiveness.

The Colombian Ministry of Trade, Industry and Tourism emphasized that this decision provides time to review market access conditions and strengthen the participation of domestic industry in automotive value chains. The extension will allow for market stability while mechanisms to promote productive integration and investment are explored.

For its part, the Brazilian government considered the agreement a sign of confidence and continuity in economic relations with Colombia. The understanding reaffirms both countries' interest in maintaining clear and predictable rules for investors and producers in the sector.

With this decision, bilateral trade in vehicles and auto parts will continue to benefit from zero tariffs until the end of 2026. In the previous period, Colombia had expressed concern about the imbalance in trade flows in the sector, so the technical dialogue that is now opening will allow for discussion of possible adjustments without affecting market stability.

The agreement was officially presented to the Committee of Representatives of ALADI, the body that acts as the depository for regional integration agreements. In closing, the Colombian delegation reiterated the country's commitment to Latin American integration and to seeking conditions that promote production and employment in the automotive sector.