RESTRICTEDWORLD TRADE
ORGANIZATIONWT/REG53/3
12 November 1998
(98-4463)
Committee on Regional Trade Agreements Original:  English
CUSTOMS UNION BETWEEN THE EUROPEAN COMMUNITY
AND THE PRINCIPALITY OF ANDORRA
Communication from the European Community
The following communication has been received with the request that it be distributed to
WTO Members.
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I. BACKGROUND INFORMATION ON THE AGREEMENT
1. Membership and Dates of Signature, Ratification and Entry into Force
The Agreement between the European Economic Community and the Principality of Andorra
in the form of an exchange of letters was signed on 28 June 1990 and entered into force on1 July 1991 (OJ N° L 374 of 31.12.1990, p.16).
The Agreement replaces the provisions applied by the Community and in particular France
and Spain, prior to the Agreement's entry into force, under the 1867 Exchange of Letters with
Andorra.
The Agreement is concluded for an unlimited duration. Within five years of its entry into
force, the two Parties shall begin consultations to examine the results of its application and, if
necessary, to open negotiations on its amendment in the light of that examination.  Until today, no
consultation has been put forward by the two Parties.
2. Type of Agreement
The Agreement establishes a customs union applying to products falling within Chapters 25
to 97 of the Harmonised System (HS).  The Agr eement also includes provisions applicable to
products falling within Chapters 1 to 24 of the HS (which are not covered by the customs union).
3. Scope
The Agreement contains provisions for all se ctors. However, only products falling within
HS Chapters 25-97 are subject to a customs union. For products within HS Chapters 1-24 the
agreement contains special arrangements under Title II.
4. Trade Data
EU imports from Andorra reached 10.2 Mio EC U in 1997, whereas exports from the EU to
Andorra amounted to 19.5 Mio ECU. The biggest share of the 15 EU member states trade withWT/REG53/3
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Andorra is held by France and Spain. Tables on EU  trade with Andorra in for the years 1993-97 are to
be found in the Annex to this document.
II. TRADE PROVISIONS
1. Import Restrictions
1.1 Duties and charges
For products covered by the customs union (HS chapters 25-97):
The EC and Andorra refrain from introducing any new customs duties on imports or charges
having equivalent effect, and from increasing those already applied to their trade with each other on
1 January 1989.
- EC: all duties and charges were abolished on 1/1/91 (with the exception of those still
applied by Spain and Portugal at the same level as applied in respect of theCommunity).
The maximum transition period for Spain and Portugal following accession is 10
years (ending 31/12/95).  From that date, all imports from Andorra should have been
duty-free and without restriction.
- Andorra: all duties and charges were abolished on 1/1/91.
For products not covered by the customs union (HS chapters 1-24):
- Products covered by HS Chapter 1-24 which originate in Andorra are exempt from
import duties when imported into the Community.
- Products covered by HS Chapter 1-24 which originate in the Community pay the
MFN rate when imported to Andorra, except products covered by headings 24.02 and24.03 which pay 60% of the MFN duty upon entry into Andorra.
Common provisions:
Exemptions from import duties, turnover tax and excise duties levied on imports by travellers
between the contracting parties and contained in the personal luggage of travellers (for strictly
non-commercial use) are foreseen (cf. Article 13 of the Agreement).
1.2 Quantitative RestrictionsQuantitative restrictions and all measures having equivalent effect between the Community
and Andorra are prohibited from 1 January 1991.
1.3 Common External TariffThe Agreement provides for the application by Andorra of the common external tariff.WT/REG53/3
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2. Export Restrictions
2.1 Duties and charges
The Agreement requires the EC and Andorra to refrain from introducing any new customs
duties on exports or charges having equivalent ef fect, and from increasing those already applied to
their trade with each other on 1 January 1989.
2.2 Quantitative RestrictionsQuantitative restrictions and all measures having equivalent effect between the Community
and Andorra are prohibited from 1 January 1991.
3. Rules of Origin
The Customs Union applies to all products which are in free circulation in either Andorra or
the Community, whether or not they are produced in  Andorra, the Community or in third countries.
Rules of origin applicable in trade be tween the EC and Andorra and methods of
administrative co-operation are set out in the Appendix to the Agreement (currently only
HS Chapters 1 to 24 are applicable).  Provisions are contained in the relevant articles of the
Agreement as well as in the Annexes and the Appendix concerning the definition of "originating
products" and methods of administrative co-operation.
The general criterion is that of wholly obtai ned products either in Andorra or in the
Community (Article 1 of the Appendix). There are no cumulation rules in the current appendix.
4. Standards
The Agreement does not provide for any provisions on standards to be applied in trade
between the Parties nor for co-operation to reduce differences in the fields of conformity assessment.
4.1 Technical barriers to tradeThe Agreement does not include any provisions in this regard.4.2 Sanitary and phytosanitary measuresThe Agreement does not include any provisions in this regard.
5. Safeguards
For products falling under HS Chapters 25 to 97 and which are thus covered by the customs
union, the Parties can take the following measures (Article 10):
(a) in case that one Party considers that disparities arising from the other Party's
application, in respect of imports from third countries, of customs duties, quantitative
restrictions or any measures having equivalent effect, or of any other measure of
commercial policy, threaten to deflect trade or to cause economic difficulties on its
territory, it can bring the matter before the Joint Committee. The Joint Committee cantake recommendations for appropriate measures for avoiding any harm liable to result
therefrom.WT/REG53/3
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(b) In emergency cases, where deflections occur or economic difficulties arise and the
Party concerned considers that they call for immediate action, that party may itself
take the necessary surveillance or protection measures. It has to notify this to the Joint
Committee without delay. The Joint Committee may recommend that these measures
be amended or abolished.
(c) By choosing such measures preference shall be given to choose those measures which
least disturb the operation of the Customs Union.
6. Anti-Dumping and Countervailing Measures
Article 7 of the Agreement requires Andorra to adopt, for products covered by the Customs
Union, the laws, regulations and administrative provisions applicable to customs matters in theCommunity and necessary for the proper functioning of the customs union. Consequently, the EC and
Andorra apply a common anti-dumping and countervailing regime vis-à-vis third countries.
7. Subsidies and State-Aid
There are no provisions on subsidies and state aids foreseen in the Agreement.
8. Sector-Specific Provisions
Except for the distinction between products covered by the Customs Union and those not
covered by the Customs Union, there are no sector sp ecific provisions the Agreement.  Title I applies
to products of HS Chapters 25 to 97 (within the customs union), whereas Title II provides
arrangements for products not covered by the customs union (HS Chapters 1 to 24).  Title III covers
common provisions applicable to all products.
Quantitative limits for certain duty-free products for travellers are referred to in Article 13.
9. Other
Co-operation in customs administrationThe Appendix to the Agreement contains specific provisions concerning the definition of
"originating products" and methods of administrative co-operation (Title II of the Appendix).
III. GENERAL PROVISIONS OF THE AGREEMENT
1. Exceptions and Reservations
Article 16 contains a standard exceptions clause applicable to all products (HS
Chapters 1-97).  The Agreement does not preclude prohibitions or restrictions on imports, exports or
goods in transit justified on grounds of public morality, public policy or public security, the protectionof health and life of humans, animals or plants, the protection of national treasures possessing artistic,
historic or archaeological value, the protection of industrial or commercial property or controls
relating to gold and silver.  Such prohibitions or restrictions should not, however, constitute a means
of arbitrary discrimination or a disguised restriction on trade between the Contracting Parties.
2. Accession
There is no provision for other countries to accede to the Agreement.WT/REG53/3
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Each Party may denounce this Agreement by notifying the other Contracting Party in writing.
In that case, the Agreement shall cease to have effect six month after the date of such notification.
3. Dispute Settlements Procedures
Any disputes arising between the Parties over the interpretation of the Agreement shall be put
before the Joint Committee (Article 18).  If the Joint Committee does not succeed in settling the
dispute at its next meeting, each Party may notify the other of the designation of an arbitrator.  The
other Party is then required to designate a second arbitrator within two months.  The Joint Committee
should then designate a third arbitrator.  Decisions by the arbitrators shall be taken by majority vote
and each Party involved in any dispute is requir ed to take the measures needed to ensure the
application of the arbitrators’ decision.
4. Relations with Other Trade Agreements
The provisions of the Agreement shall replace those applied by the Community, and in
particular France and Spain, prior to the Agreement's entry into force, under the 1867 Exchange of
Letters with Andorra (Article 25).
5. Institutional Framework
According to Article 17 of the Agreement, a Joint Committee shall be set up with the
responsibility for administering the Agreement and ensuring that it is properly implemented.  To thatend it has the power to formulate recommendations. It shall take decisions in the cases provided for in
the Agreement.WT/REG53/3
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ANNEX
EC/Andorra:  Customs Union
Trade Data
Note:  The following tables show the developmen t of trade between the EC and Andorra over the
period 1993-97.  For ease of comparison, figures are also given for the development of EC trade with
all third countries
Table 1
SHARE OF ANDORRA IN TOTAL EU  TRADE 1993-97 (B illion ECU)
Year Extra-EU Andorra
Exports Imports Total Exports Imports Total
1993 409.1 445.8 854.9 0.708 0.027 0.736
1994 453.5 489.6 943.1 0.665 0.034 0.6991995 476.8 491.8 968.6 0.697 0.031 0.7281996 523.5 522.8 1046.3 0.675 0.027 0.7021997 608.2 604.3 1212.5 0.830 0.039 0.869
Table 2
SHARE OF ANDORRA IN TOTA L EU TRADE 1993-97 (%)
Year Extra-EU Andorra
Exports Imports Total Exports Imports Total
1993 47.85% 52.15% 100.00% 0.08% 0.00% 0.09%
1994 48.09% 51.91% 100.00% 0.07% 0.00% 0.07%
1995 49.23% 50.77% 100.00% 0.07% 0.00% 0.08%1996 50.03% 49.97% 100.00% 0.06% 0.00% 0.07%1997 50.16% 49.84% 100.00% 0.07% 0.00% 0.07%WT/REG53/3
Page 7Table 3:  EU Exports to Extra-EU  and Andorra 1993-97 by HS Section
EU EXPORTS TO EXTRA-EU EU EXPORTS TO ANDORRA
EU TRADE BY HS SECTION MECU 1993 = 100 97 %
shareMECU 1993 = 100 97 %
share
HS Section 1993 1994 1995 1996 1997 1994 1995 1996 1997 1993 1994 1995 1996 1997 1994 1995 1996 1997
I     animals & animal products 8,401 8,933 9,652 9,768 10,564 106 115 116 126 2% 62.5 59.9 57.2 51.5 56.9 96 91 82 91 7%
II     vegetable products 8,406 8,386 7,917 8,311 9,341 100 94 99 111 2% 15.4 14.5 13.5 6.1 12.7 94 88 40 82 2%
IIl    animal or vegetable fats 1,375 1,628 2,098 1,906 2,250 118 153 139 164 0% 5.7 5.8 11.9 8.5 6.5 102 209 150 114 1%
IV    prepared foodstuffs 17,212 18,663 18,157 19,371 22,174 108 105 113 129 4% 92.0 81.7 84.7 88.8 133.9 89 92 96 145 16%
V   - mineral products 16,503 17,565 14,534 16,393 18,550 106 88 99 112 3% 43.7 39.2 44.5 40.5 56.7 90 102 93 130 7%
VI    chemical products 47,774 53,168 53,654 60,026 71,897 111 112 126 150 12% 70.3 66.7 72.6 71.4 76.7 95 103 102 109 9%
VII   plastics & rubber 17,426 19,898 19,775 21,327 25,658 114 113 122 147 4% 18.4 16.8 18.2 16.9 19.2 91 99 92 104 2%
VIII  hides & skins 4,361 5,361 5,709 6,721 6,911 123 131 154 158 1% 10.7 10.9 11.6 12.1 14.3 101 109 113 133 2%
IX    wood & wood products 2,117 2,535 3,681 3,990 4,862 120 174 188 230 1% 6.9 7.3 8.0 7.4 9.7 105 116 107 141 1%
X     wood pulp products 10,751 12,156 17,517 17,625 19,484 113 163 164 181 3% 17.0 16.5 16.4 15.7 20.0 97 96 92 118 2%
XI    textiles & textile articles 22,271 25,109 23,544 25,549 28,724 113 106 115 129 5% 58.6 52.9 54.6 56.8 64.7 90 93 97 110 8%
XII   footwear, headgear 4,522 5,309 5,003 5,611 5,938 117 111 124 131 1% 20.8 21.0 21.1 21.0 23.6 101 101 101 113 3%
XIII articles of st one, plaster, cement,
asbestos8,541 9,673 9,932 10,725 12,293 113 116 126 144 2% 16.5 17.0 17.5 15.5 19.1 103 106 94 116 2%
XIV pearls, precious or semiprecious
stones, metals13,856 15,044 14,893 16,308 18,643 109 107 118 135 3% 11.4 10.6 11.4 13.8 19.9 92 100 121 174 2%
XV   base metals & articles thereof 32,610 35,323 35,522 38,191 42,755 108 109 117 131 7% 29.0 25.8 24.8 23.7 27.7 89 85 82 95 3%
XVI machinery  & mechanical
applicances117,424 131,391 146,566 165,167 191,376 112 125 141 163 31% 108.1 100.1 103.5 99.9 121.9 93 96 92 113 15%
XVII  transportation equipment 40,752 44,936 48,471 53,548 66,229 110 119 131 163 11% 48.2 51.5 57.7 60.4 69.7 107 120 125 144 8%
XVIII  instruments – measuring, musical 16,481 17,861 18,696 20,414 23,977 108 113 124 145 4% 33.6 31.4 30.9 29.7 31.1 94 92 88 93 4%
XIX  arms & ammunition 756 741 774 1,018 1,249 98 102 135 165 0% 1.0 0.9 1.0 0.9 1.4 83 100 89 134 0%
XX   miscellaneous 9,999 11,368 11,968 12,838 14,576 114 120 128 146 2% 37.4 34.1 34.6 32.8 42.9 91 93 88 115 5%
XXI   works of art 2,159 2,360 2,380 2,204 2,816 109 110 102 130 0% 0.2 0.4 0.1 0.6 0.2 207 57 297 111 0%
Others (outside HS 01-97) 5,452 6,058 6,315 6,481 7,908 111 116 119 145 1% 0.5 0.5 0.5 1.3 1.0 109 109 258 206 0%
TOTAL 409,149 453,466 476,758 523,492 608,175 111 117 128 149 100% 708.1 665.5 696.6 675.3 829.7 94 98 95 117 100%
Note:   1993-95 EU12, 1996-97 EU15
Source   Eurostat COMTEXTWT/REG53/3
Page 8Table 4:  EU Imports from Extra-EU and Andorra 1993-97 by HS Section
EU IMPORTS FROM EXTRA-EU EU IMPORTS FROM ANDORRA
EU TRADE BY HS SECTION MECU 1993 = 100 97 %
shareMECU 1993 = 100 97 %
share
HS Section 1993 1994 1995 1996 1997 1994 1995 1996 1997 1993 1994 1995 1996 1997 1994 1995 1996 1997
I    animals & animal products 9,443 10,176 10,223 10,751 11,994 108 108 114 127 2% 0.6 0.7 0.6 0.4 0.4 111 99 74 68 1%
II    vegetable products 16,669 20,027 22,918 22,870 24,981 120 137 137 150 4% 0.0 0.0 0.0 0.0 0.0 59 84 38 85 0%
III   animal or vegetable fats 1,575 2,033 2,296 1,888 1,861 129 146 120 118 0% 0.0 0.0 0.0 0.0 0.0 0%
IV   prepared foodstuffs 14,815 16,122 15,672 17,841 18,106 109 106 120 122 3% 3.2 2.4 1.5 1.7 2.3 76 46 55 71 6%
V    mineral products 69,968 71,926 73,138 84,566 93,793 103 105 121 134 16% 0.4 3.4 0.4 0.5 0.4 832 98 132 94 1%
VI   chemical products 27,386 31,717 34,159 36,141 41,988 116 125 132 153 7% 0.9 1.4 1.1 1.2 1.7 151 128 132 188 4%
VII  plastics & rubber 13,195 15,074 16,294 16,326 18,347 114 123 124 139 3% 0.5 0.6 0.7 1.0 1.1 115 151 213 230 3%
VIII hides & skins 5,741 7,012 7,065 7,358 8,204 122 123 128 143 1% 0.3 0.4 0.3 0.3 1.1 131 99 85 363 3%
IX   wood & wood products 10,953 13,226 9,880 9,092 10,934 121 90 83 100 2% 0.1 0.1 0.2 0.3 0.3 169 428 542 516 1%
X    wood pulp products 17,417 20,306 12,489 10,921 11,733 117 72 63 67 2% 2.7 4.1 4.9 4.9 6.1 149 178 179 222 16%
XI   textiles & textile articles 35,943 38,683 38,522 40,250 47,850 108 107 112 133 8% 7.8 6.8 5.2 5.4 6.2 88 67 69 80 16%
XII  footwear, headgear 5,466 5,912 5,878 6,528 7,688 108 108 119 141 1% 0.2 0.1 0.2 0.1 0.2 54 72 41 98 1%
XIII articles of st one, plaster, cement,
asbestos3,845 4,240 4,105 4,205 4,842 110 107 109 126 1% 0.2 0.3 0.1 0.2 0.2 118 47 78 99 1%
XIV pearls, precious or semiprecious
stones, metals20,145 19,390 19,885 20,892 23,135 96 99 104 115 4% 0.8 1.1 0.7 0.3 0.3 136 85 40 32 1%
XV  base metals & articles thereof 25,781 32,741 35,636 31,707 37,506 127 138 123 145 6% 0.8 1.5 0.7 0.6 0.7 192 85 81 95 2%
XVI machinery & mechanical
applicances93,892 106,930 111,807 119,672 142,440 114 119 127 152 24% 3.1 4.3 4.2 5.4 10.1 137 135 173 325 26%
XVI  transportation equipment 34,610 33,961 30,985 34,342 46,029 98 90 99 133 8% 3.3 4.3 9.1 2.8 4.3 130 273 84 129 11%
XVIII instruments - measuring,
musical17,383 18,527 19,649 21,200 24,234 107 113 122 139 4% 0.3 0.2 0.2 0.1 0.7 72 63 45 206 2%
XIX   arms & ammunition 344 354 381 396 534 103 111 115 155 0% 0.0 0.0 0.0 0.0 0.0 1,065 54 51 173 0%
XX    miscellaneous 12,359 12,509 12,642 13,912 17,076 101 102 113 138 3% 1.1 1.4 0.6 0.9 1.8 123 55 83 160 5%
XXI   works of art 2,103 2,061 1,537 1,235 1,682 98 73 59 80 0% 0.0 0.3 0.0 0.0 0.0 1,296 25 67 179 0%
Others (outside HS 01-97) 6,749 6,679 6,591 10,737 9,374 99 98 159 139 2% 1.0 0.4 0.7 0.7 1.0 40 69 65 100 3%
TOTAL 445,782 489,606 491,752 522,830 604,331 110 110 117 136 100% 27.5 33.7 31.4 27.0 38.9 123 115 98 142 100%
Note:     1993-95 EU12, 196-97 EU15
Source:  Eurostat COMEXT
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