WORLD TRADE
ORGANIZATIONWT/REG99/R/B/1
G/L/365
17 April 2000
(00-1538)
Original:  English
CO-OPERATION AGREEMENT BETWEEN THE
EUROPEAN COMMUNITY AND ISRAEL
Biennial Report on the Operation of the Agreement
Communication from the Parties
The report below presents the information rece ived from the Permanent Delegation of the
European Commission, dated 21 March 2000.  It is organized in accordance to the Standard Format
for Information on Regional Trade Agreements (WT/REG/W/6).
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I. BACKGROUND INFORMATION ON THE AGREEMENT
1. Membership and Dates of Signature, Ratification and Entry into Force
The first trade agreement between the European Community and Israel was concluded in
1964.  Subsequent agreements were agreed in 1970 and 1975.
An Euro-Mediterranean Agreement Establishing an Association between the
European Communities and their Member States of one part and the State of Israel of the other part(hereinafter the Association Agreement) was signed on 20 November 1995.  Pending conclusion of
the ratification procedures for the Euro-Mediterranean Agreement and its entry into force, the
European Community and Israel concluded an Inte rim Agreement on trade and trade related matters.
This Interim Agreement was signed on 18 December 1995 and entered into force on 1 January 1996.
4. Trade Data
Statistical data on the evolution of trade between the European Communities and Israel is
presented in the Annex.
II. TRADE PROVISIONS
1. Import Restrictions &
2. Export Restrictions
Under the provisions of the 1975 agreement, trade in all non-agricultural goods has been
duty-free since 1 January 1989.  The EC for its part had abolished tariffs and quotas on imports of all
industrial products by July 1977, in addition to the tariff reductions granted on most of Israel’s
agricultural exports.  The Interim Agreement strengthens and widens the relations between the
Community and its Member States and Israel established by the 1975 Co-operation Agreement.WT/REG99/R/B/1
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The Interim Agreement reinforces the free trade area between the parties already established
under the 1975 Co-operation Agreement.  Its main features in this regard are:
- the Agreement confirms that all trade in industrial products between the parties is
duty- and quota-free;1
- the Parties agree to extend additional tariff concessions to trade in agricultural
products from 1 January 1996.  Furthermore, the European Community and Israel
agree to progressively establish a greater liberalisation of their trade in agricultural
products.  Measures in accordance with this objective should be applied from
1 January 2001;
- the Parties also agree to examine the possibility of granting mutual concessions on
trade in fisheries products at the latest three years after entry into force of the
Euro-Mediterranean Agreement.
3. Rules of Origin
The provisions of the Interim Agreement the on rules of origin include the possibility of
bilateral cumulation.
7. Subsidies and State-aid
The Interim Agreement includes provisions on competition  and establishes a transparency
mechanism for the exchange of information on State-aids (annual reporting on the total amount and
distribution of aid given).  Information on speci fic individual cases can also be requested.
IV. OTHER
Property rights
The Agreement confirms that both parties will grant and ensure adequate and effective
protection of intellectual, industrial and commercial  property rights in accordance with the highest
international standards including effective means of enforcing such rights.  In this context, it is
foreseen that Israel shall accede to those relevant multilateral conventions to which it is not already
party.
Public procurement
Separately from the Interim Agreement, the Eu ropean Community and Israel have concluded
two agreements on public procurement which entered into force in August 1997.  The first of these
relates to procurement by telecommunications operators and the second to government procurementmore broadly.
                                                     
1 This has been the case since January 1989.WT/REG99/R/B/1
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The Agreement on telecommunications procurement provides for a mutual opening of
procurement by telecommunications operators through granting an exchange of national treatment.  In
Israel the provisions of Chapter 2 of the regulations of the Mandatory Tenders Law will not be applied
to bids comprising products of EC origin.  In th e EU, the provisions of Article 36 of the Utilities
Directive (93/38 EEC) will not be applied against tenders comprising products of Israeli origin.WT/REG99/R/B/1
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Page 4ANNEX2
Table 1 - EU Imports from World and Israel, 1980-1998
(Million ECU)
S I T C :0 123 4 56789 T O T A L
1980 (EU 9)
      WORLD 23,908 1,929 27,501 85,384 1,579 11,374 37,648 37,853 22,176 20,502 269,853
      Israel 369 1 173 81 1 184 389 67 236 59 1,560
1984 (EU 10)
      WORLD 33,643 2,810 36,139 107,594 2,803 19,968 48,969 71,432 34,537 24,205 382,100
      Israel 589 1 322 24 1 378 461 172 347 68 2,363
1988 (EU 12)
      WORLD 32,221 2,152 35,752 47,393 1,499 25,067 59,078 106,689 49,968 27,937 387,757
      Israel 529 2 282 17 1 488 613 331 410 214 2,885
1992 (EU 12)
      WORLD 34,580 3,215 32,218 65,183 1,748 33,888 69,355 146,277 76,771 23,900 487,135
       Israel 485 3 288 48 1 607 727 517 571 90 3,336
1996 (EU 15)
      WORLD 41,305 3,599 34,829 75,910 2,423 44,328 75,479 189,056 93,962 20,131 581,065
      Israel 495 4 345 33 2 841 1,533 1,152 733 86 5,257
1997 (EU 15)
      WORLD 44,248 4,072 40,131 85,155 2,554 51,485 87,685 229,346 108,779 17,690 672,413
      Israel 509 5 360 78 2 1,074 1,828 1,398 901 59 6,270
1998 (EU 15)
      WORLD 45,198 4,458 39,370 64,843 2,891 55,290 94,672 264,153 116,092 22,676 709,643
      Israel 536 4 369 102 3 1,119 1,843 1,733 987 46 6,886
                                                     
2 The source for all the tables is Eurostat (COMEXT).WT/REG99/R/B/1
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Page 5Table 2 - EU Exports to World and Israel, 1980-1998
(Million ECU)
S I T C : 0 1 2 345 6 7 8 9 T O T A L
1980 (EU 9)
      WORLD 13,662 3,422 4,327 10,071 717 23,228 46, 455 84,154 21,333 13,716 221,084
      Israel 86 5 20 6 5 163 650 502 85 153 1,676
1984 (EU 10)
      WORLD 21,120 5,784 7,319 18,087 1,343 38,465 65,412 129,088 39,835 24,806 351,259
      Israel 161 21 41 13 13 403 1,275 1,119 250 182 3,477
1988 (EU 12)
      WORLD 19,588 6,205 7,602 8,232 1,158 44,449 65, 673 141,249 48,507 20,256 362,917
      Israel 198 16 60 16 13 526 1,981 1,354 377 172 4,712
1992 (EU 12)
      WORLD 24,887 8,778 8,068 10,552 1,491 54,200 71,091 180,838 59,247 16,939 436,091
      Israel 245 22 68 16 19 745 2,713 2,035 522 174 6,558
1996 (EU 15)
      WORLD 30,646 10,339 11,414 15,431 1,998 79,14 4 102,957 283,081 79,287 12,695 627,011
      Israel 383 39 137 62 19 1,179 4,003 3,282 1,040 107 10,443
1997 (EU 15)
      WORLD 33,504 12,374 13,084 17,109 2,575 93,04 6 114,927 331,113 88,686 13,717 721,109
      Israel 455 53 172 47 22 1,351 4,494 3,480 1,146 54 11,512
1998 (EU 15)
      WORLD 31,772 12,005 11,554 13,833 2,831 95,88 5 112,815 343,435 89,424 16,869 730,423
      Israel 425 53 156 39 23 1,440 3,854 3,340 1,248 109 10,926WT/REG99/R/B/1
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Page 6Table 3 - EU Trade with Israel by HS Section
(Million ECU)
EXPORTS IMPORTS
SECTION 1988 1992 1996 1997 1998 SECTION 1988 1992 1996 1997 1998
TOTAL 4,712 6,558 10,481 11,549 10,926 TOTAL 2,885 3,336 5,258 6,271 6,886
I 26 26 51 58 63 I 22 22 18 22 21
II 65 67 70 96 80 II 333 408 529 553 587
III 14 20 16 16 20 III 1 1 2 2 3
IV 133 186 321 380 371 IV 291 224 167 164 168
V 28 43 99 85 68 V 101 110 94 130 159
VI 384 556 920 1,084 1,142 VI 397 472 652 826 849
VII 239 330 455 499 539 VII 154 231 363 445 481
VIII 17 19 24 25 23 VIII 11 4 10 10 11
IX 14 26 118 154 145 IX 12 14 8 8 8
X 88 127 264 300 320 X 20 24 34 49 51
XI 207 333 486 525 505 XI 393 474 475 516 493
X I I 2 53 8 8 49 18 9 X I I 71 1 1 11 51 4
XIII 115 156 266 284 261 XIII 14 12 37 35 41
XIV 1,277 1,694 2,420 2,870 2,347 XIV 379 410 1,066 1,325 1,273
XV 367 482 768 741 666 XV 85 138 234 256 315
XVI 811 1,322 2,169 2,283 2,453 XVI 305 468 1,067 1,312 1,636
XVII 547 720 1,155 1,255 963 XVII 16 37 58 62 83
XVIII 112 135 256 273 352 XVIII 96 141 246 355 420
XIX 2 5 5 6 2 XIX 3 5 1 31 7
XX 76 103 229 263 269 XX 23 37 57 60 72
XXI 49 26 55 39 81 XXI 43 30 48 43 52WT/REG99/R/B/1
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Page 7Table 4 - EU Trade with World by HS Section
(Million ECU)
EXPORTS IMPORTS
SECTION 1988 1992 1996 1997 1998 SECTION 1988 1992 1996 1997 1998
TOTAL 362,917 436,091 627,011 721,109 730,423 TOTAL 387,757 487,135 581,065 672,413 709,643
I 7,060 8,001 9,980 10,897 10,062 I 8, 349 10,300 10,897 12,227 13,296
II 6,372 8,511 8,819 9,757 9,145 II 17,55 5 17,353 23,130 25,437 24,992
III 1,341 1,673 2,286 2,977 3,156 III 1,542 1,781 2,250 2,390 2,693
IV 13,817 19,194 24,510 27,744 27,279 I V 13,638 15,595 18,511 19,019 19,518
V 9,723 12,152 17,487 19,630 16,711 V 55,920 73,081 84,793 95,737 75,508
VI 37,393 46,951 68,968 81,772 85,215 V I 22,179 29,303 39,774 46,234 49,432
VII 15,521 16,914 23,128 27,148 27,504 V II 10,125 13,862 17,132 19,323 21,043
VIII 4,119 4,084 7,159 7,375 6,435 VIII 6,121 5,701 7,590 8,498 8,224
IX 1,771 2,035 4,045 4,927 5,182 IX 9, 615 10,926 9,118 10,973 11,434
X 7,937 10,271 18,033 19,764 19,803 X 17,605 19,227 11,110 11,996 12,571
XI 20,244 25,208 31,611 34,724 35,221 X I 28,639 39,478 47,467 55,248 57,903
XII 3,440 4,526 5,922 6,313 6,043 XII 3,325 5,451 7,029 8,308 8,274
XIII 7,153 8,120 11,257 12,916 12, 894 XIII 2,593 3,883 4,386 5,090 5,648
XIV 13,026 12,425 16,992 19,285 17,990 X IV 17,526 15,037 21,620 23,890 26,981
XV 30,826 30,864 42,214 46,944 45,623 X V 26,101 29,345 33,661 40,312 44,472
XVI 93,666 120,842 193,730 226,482 234,539 XVI 81,389 106,397 146,298 173,122 195,378
XVII 46,674 59,351 89,086 104,705 110,049 XVII 25,240 40,386 42,797 56,275 68,476
XVIII 14,107 17,067 23,982 28,129 29,109 XVIII 14,869 19,652 24,343 27,814 29,926
XIX 402 388 1,097 1,326 1,656 XIX 118 194 466 603 510
XX 7,819 9,378 13,350 15,177 15,242 XX 6 ,655 12,072 14,394 17,529 19,046
XXI 8,204 5,727 13,354 13,115 11,565 XXI 5,733 5,511 14,298 12,387 14,318
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