WORLD TRADE
ORGANIZATIONWT/REG128/1
4 October 2001
(01-4762)
Committee on Regional Trade Agreements Original:  English
FREE TRADE AGREEMENT BETWEEN HUNGARY AND ESTONIA
The following text reproduces the Agreement between Hungary and Estonia.1
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FREE TRADE AGREEMENT BETWEEN HUNGARY AND ESTONIA
PREAMBLE
The Republic of Hungary and the Republic of Estonia , hereinafter called respectively
"Hungary", "Estonia" or "the Parties",
Reaffirming  their firm commitment to pluralistic democracy based on the rule of law, respect
of human rights and fundamental freedoms,
Recalling their intention to participate actively in the process of economic integration as an
important dimension of the stability on the European continent and expressing their preparedness to
co-operate in seeking ways and means to strengthen this process,
Reaffirming  their firm commitment to the principles of a market economy, which constitutes
the basis for their relations,
Having  regard to the Treaty on Friendship and Cooperation between the Republic of Estonia
and the Republic of Hungary, signed on 8 August 1992 in Tallinn,
Recalling  their firm commitment to the Final Act of the Conference on Security and
Co-operation in Europe, the Paris Charter and, in particular, the principles contained in the final
document of the Bonn Conference on Economic Co-operation in Europe,
Resolved  to this end to eliminate progressively th e obstacles to substantially all their mutual
trade, in accordance with the provisions of the General Agreement on Tariffs and Trade 1994 and the
Agreement establishing the World Trade Organization (WTO), Estonia having objective to become a
member of the WTO,
Firmly  convinced that this Agreement will foster the intensification of mutually beneficial
trade relations between them and contribute to the process of integration in Europe,
                                                     
1 The Annexes and Protocol thereto have been su bmitted to the Secretariat for consideration by
interested Members (Office 3006).WT/REG128/1
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Determined  to implement this Free Trade Agreement with the objective to preserve and
protect the environment and to ensure an optimal use of natural resources in accordance with the
principle of sustainable growth,
Hereby  agreed as follows:
Article 1
Objectives
1. The Parties shall gradually establish during a transitional period a free-trade area in
accordance with the provisions of this Agreemen t and in conformity with Article XXIV of the
General Agreement on Tariffs and Trade 1994 and with the Understanding on the Interpretation of
Article XXIV of the Agreement establishing the World Trade Organization.
2. The objectives of this Agreement are:
(a) to promote through the expansion of mutual trade the harmonious development of the
economic relations between the Parties,
(b) to provide fair conditions of competition for trade between the Parties,
(c) to contribute in this way, by the removal of barriers to trade, to the harmonious
development and expansion of world trade,
(d) to enhance co-operation between the Parties.
CHAPTER I
Industrial Products
Article 2
Scope
The provisions of this Chapter shall apply to industrial products originating in the Parties.
The term "industrial products" means for the purpos e of this Agreement the products falling within
Chapters 25 to 97 of the Harmonized Commodity Description and Coding System, excluding the
products listed in Annex I.
Article 3
Customs Duties on Imports and Charges having Equivalent Effect
1. No new customs duties on imports or charges ha ving equivalent effect shall be introduced in
trade between the Parties.
2. The Parties shall abolish between them on the date of entry into force of this Agreement all
customs duties on imports and all charges having equivalent effect, except those listed in Annex II.WT/REG128/1
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Article 4
Basic Duties
1. For commercial exchanges covered by this Agreement, the Hungarian Customs Tariffs shall
be applied to the classification of goods for import into Hungary.  The Estonian Customs Tariffs shall
be applied to the classification of goods for import into Estonia.
2. For each product the basic duty to which successive reductions set out in this Agreement are
to be applied shall be the MFN duty that was in force on the date of 1 January 1998.
3. If after entry into force of this Agreement any tariff reduction is applied on an erga omnes
basis in particular reductions resulting from the tariff agreement concluded as a result of the GATT
Uruguay Round, such reduced duties shall replace the basic duties referred to in paragraph 2 as from
that date when such reductions are applied.
Article 5
Fiscal Duties
The provisions of Article 3 (Customs Duties on Imports and Charges having Equivalent
Effect) shall also apply to customs duties of a fiscal nature.
Article 6
Customs Duties on exports and Charges having equivalent Effect
1. No new customs duties on exports or charges having equivalent effect shall be introduced in
trade between the Parties.
2. The Parties shall abolish between them on the date of entry into force of this Agreement all
customs duties on exports and all charges having equivalent effect.
Article 7
Quantitative Restrictions on Imports and Measures having Equivalent Effect
1. No new quantitative restrictions on imports or measures having equivalent effect shall be
introduced in trade between the Parties.
2. All quantitative restrictions and measures having equivalent effect on imports of products
originating in the Parties shall be abolished on the da te of entry into force of this Agreement, except
those listed in Annex III, which shall be progressively abolished by 31 December 2000 at the latest.
Article 8
Quantitative Restrictions on Exports and Measures having Equivalent Effect
1. No new quantitative restrictions on exports or measures having equivalent effect shall be
introduced in trade between the Parties.WT/REG128/1
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2. All quantitative restrictions and measures having equivalent effect on exports of products
originating in the Parties shall be abolished on the da te of entry into force of this Agreement, except
those that might be required for the administration of international obligations and listed in Annex IV.
CHAPTER II
Agricultural Products
Article 9
Scope
The provisions of this Chapter shall apply to ag ricultural products originating in the Parties.
The term "agricultural products" means for the purpose of this Agreement the products falling within
Chapters 1 to 24 of the Harmonized Commodity Descriptions and Coding System and the products
listed in Annex I.
Article 10
Exchange of Concessions
The Parties to this Agreement grant each other the following concessions:
1. Hungary shall grant preferential treatment to the agricultural products originating in Estonia
listed in Annex V.
2. No customs duties are applied in Estonia to products originating in Hungary from the date of
entry into force of this Agreement.
3. Taking into account the Estonian customs tariff structure on the date of entry into force of this
Agreement, where no customs duties are applied for agricultural products, in the event that as a result
of Estonia's accession to the WTO a new tariff regime for the agricultural products is established,
Estonia may, by way of derogation from the provisions of this Article and pursuant to theimplementation of its agricultural policy introduce customs duties on a limited number of agricultural
products originating in Hungary.
4. In such cases Estonia shall ensure a sizeable margin of preference for products originating in
Hungary granting them treatment not less favour able, than granted by Hungary to the products
originating in Estonia ensuring at the same time the overall balance of mutual concessions.
Article 11
Concessions and Agricultural Policies
1. Without prejudice to the concessions granted under this Agreement, the provisions of this
Chapter shall not restrict in any way the pursuance of the respective agricultural policies of the Parties
or the taking of any measures under such policies, including the implementation of the respective
provisions of the Agreement on Agriculture within  the framework of the World Trade Organization.
2. The Parties shall notify each other of changes in their respective agricultural policies pursued
or measures applied which may affect the conditions of agricultural trade among them as provided forWT/REG128/1
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in this Agreement.  Prompt consultations shall be held, upon request of any Party, to examine the
situation.
Article 12
Special Safeguards
Notwithstanding other provisions of this Agr eement and, in particular, Article 25 (General
Safeguards), if, given the particular sensitivity of the agricultural markets, imports of products
originating in a Party, which are subject to concessions granted under this Agreement, cause serious
disturbance to the markets of the other Party, the Party concerned shall enter into consultations
immediately to find the appropriate solution.  Pending such solution, the Party concerned may take themeasures it deems necessary.
Article 13
Veterinary, Health and Phytosanitary Measures
1. The Parties shall apply their regulations in sanitary and phytosanitary matters in
nondiscriminatory fashion and shall not introduce any new measures that have the effect of unduly
obstructing trade.
2. The veterino-sanitary measures and the work of the veterinary services will be in accordance
with the Office International des Epizooties Codex and other international conventions in this field.
3. The phytosanitary measures and the work of the plant protection service will be in accordance
with the International Plant Protection Convention a nd other international conventions in this field.
CHAPTER III
General Provisions
Article 14
Rules of Origin and Co-operation in Customs Administration
1. The Protocol to this Agreement lays down the rules of origin and related methods of
administrative co-operation.
2. The Parties shall take appropriate measures, including regular reviews by the Joint Committee
and arrangements for administrative co-operation, to ensure that the provisions of this Protocol to this
Agreement and Articles 3 (Customs Duties on Im ports and Charges having Equivalent Effect),
4 (Basic Duties), 5 (Fiscal Duties), 6 (Customs Duties on Exports and Charges having EquivalentEffect), 7 (Quantitative Restrictions on Imports and Measures having Equivalent Effect) and
8 (Quantitative Restrictions on Exports and Measures having Equivalent Effect), 15 (Internal
Taxation) and 26 (Structural Adjustments) of this Agreement are effectively and harmoniously
applied, and to reduce, as far as possible, the formalities imposed on trade, and to achieve mutually
satisfactory solutions to any difficulties arising from the operation of those provisions.WT/REG128/1
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Article 15
Internal Taxation
1. The Parties shall refrain from any measure or practice of an internal fiscal nature establishing,
whether directly or indirectly, discrimination between the products originating in the Parties.
2. Products exported to the territory of one of the Parties may not benefit from repayment of
internal taxation in excess of the amount of direct or indirect taxation imposed on them.
Article 16
General Exceptions
This Agreement shall not preclude prohibitions or restrictions on imports, exports or goods in
transit justified on the grounds of:  public morality, public policy or public security;  the protection of
human, animal or plant life or health;  the protection of environment;  the protection of nationaltreasures possessing artistic, historic or archaeological value;  the protection of intellectual property;
the rules relating to gold or silver;  the conversation of exhaustible natural resources if such measures
are made effective in conjunction with restrictions on domestic production or consumption.  Such
prohibitions or restrictions shall not, however, cons titute a means of arbitrary discrimination or a
disguised restriction on trade between the Parties.
Article 17
Security Exceptions
Nothing in this Agreement shall prevent a Party from taking any appropriate measure which it
considers necessary:
(a) to prevent the disclosure of information contrary to its essential security interests;
(b) for the protection of its essential security interests or for the implementation of
international obligations or national policies:
(i) relating to the traffic in arms, ammunition and implements of war, provided
that such measures do not impair the conditions of competition in respect of
products not intended for specifically military purposes, and to such traffic in
other goods, materials and services as is carried on directly or indirectly for
the purpose of supplying a military establishment;  or
(ii) relating to the non-proliferation of biological and chemical weapons, nuclear
weapons or other nuclear devices;  or
(iii) taken in time of war or other serious international tension.
Article 18
State Monopolies
1. The Parties shall adjust progressively any State monopoly of commercial character so as to
ensure that by 1 July 1999 no discrimination regarding the conditions under which goods are procuredWT/REG128/1
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and marketed exists between nationals of the Parties.  The Parties shall inform each other about the
measures adopted to implement this objective.
2. The provisions of this Article shall apply to any body through which the competent
authorities of the Parties, in law or in fact, eith er directly or indirectly supervise, determine or
appreciably influence imports or exports between the Parties.  These provisions shall likewise apply to
monopolies delegated by a Party to other bodies.
Article 19
Payments
1. Payments in freely convertible currencies relating to trade in goods between the Parties and
the transfer of such payments to the territory of  the Party to this Agreement, where the creditor
resides, shall be free from any restrictions.
2. The Parties shall refrain from any exchange or administrative restrictions on the grant,
repayment or acceptance of short and medium term credits related to trade in goods in which a
resident of a Party participates.
3. Notwithstanding the provisions of paragraph 2, any measures concerning current payments
connected with the movement of goods shall be in  conformity with the co nditions laid down under
Article VIII of the Articles of the Agreement of the International Monetary Fund.
Article 20
Rules of Competition concerning Undertakings
1. The following are incompatible with the proper functioning of this Agreement in so far as
they may affect trade between the Parties:
(a) all agreements between undertakings, decisions by associations of undertakings and
concerted practices between undertakings which have as their object or effect the
prevention, restriction or distortion of competition;
(b) abuse by one or more undertakings of a dominant position in the territories of the
Parties as a whole or in substantial part thereof.
2. The provisions of paragraph 1 of this Article shall apply to the activities of all undertakings
including public undertakings and undertakings to which the Parties grant special or exclusive rights.
Undertakings entrusted with the operation of services or general economic interest or having thecharacter of a revenue-producing monopoly, shall be subject to provisions of paragraph 1 in so far as
the application of these provisions does not obstruct the performance, in law or in fact, of the
particular public task assigned to them.
3. With regard to products referred to in Chapter II the provisions stipulated in paragraph 1(a) of
this Article shall not apply to such agreements, decisions and practices which form an integral part of
a national market organization.
4. If a Party considers that a given practice is incompatible with paragraphs 1, 2 and 3 of this
Article and if such practice causes or threatens to cause serious prejudice to the interest of that Partyor material injury to its domestic industry, it may take appropriate measures under the conditions andWT/REG128/1
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in accordance with the procedure laid down in Ar ticle 29 (Procedure for the Application of Safeguard
Measures).
Article 21
State Aid
1. Any aid granted by a Party to this Agreement or through state resources in any form
whatever, which distorts or threatens to distort competition by favouring certain undertakings or the
production of certain goods shall, in so far as it ma y affect trade between the Parties, be incompatible
with the proper functioning of this Agreement.
2. The provisions of paragraph 1 of this Article shall not apply to products referred to in
Chapter II.
3. The Parties shall ensure transparency in the area of state aid, inter alia , by reporting annually
to the Joint Committee on the total amount and the distribution of the aid given and by providing tothe other Party, upon request, information on aid schemes and on particular individual cases of state
aid.
4. If a Party considers that a particular practice:
- is incompatible with the terms of paragraph 1;  or
- causes or threatens to cause serious prejudice to the interest of that Party or material
injury to its domestic industry,
it may take appropriate measures under the conditions of and in accordance with the provisions of
Article 29 (Procedure for the Application of Safeguard Measures).  Such appropriate measures may
only be taken in conformity with the procedures and under the conditions laid down by the General
Agreement on Tariffs and Trade 1994 and by the Agreement establishing the World Trade
Organization and any other relevant instruments negotiated under their auspices which are applicable
between the Parties.
Article 22
Public Procurement
1. The Parties consider the liberalization of their respective public procurement markets as an
objective of this Agreement.
2. The Parties shall progressively develop their respective regulations for public procurement
with a view to grant suppliers of the other Party, on 1 January 2001 at the latest, access to contract
award procedures on their respective public procurem ent markets according to the provisions of the
Agreement on Government Procurement in Annex IV to the Agreement establishing the World Trade
Organization.
3. The Joint Committee shall examine developments related to the achievement of the objectives
of this Article and may recommend practical modalities of implementing the provisions ofparagraph 2 so as to ensure free access, transparency and full balance of rights and obligations.WT/REG128/1
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4. During the examination referred to in paragraph 3, the Joint Committee may consider,
especially in the light of international developments  and regulations in this area,  the possibility of
extending the coverage and/or the degree of the market opening provided for in paragraph 2.
5. The Parties shall endeavour to accede to the relevant Agreements negotiated under the
auspices of the General Agreement on Tariffs and Trade 1994 and the Agreement establishing the
World Trade Organization.
Article 23
Protection of Intellectual Property
1. The Parties shall grant and ensure the protection of intellectual property rights on a non-
discriminatory basis, including measures for granting and enforcing such rights.  The protection shall
be gradually improved on a level corresponding to the substantive standards of the multilateral
agreements which are specified in Annex VI to this Agreement by 1 January 1999 at the latest.
2. For the purposes of this Agreement, "intellectual property protection "includes, in particular,
protection of copyright, comprising computer programs and databases, and neighbouring rights,
trademarks for goods and services, geographical indications including appellation of origin, industrial
designs, patents, topographies of integrated circuits, as well as undisclosed information on know-how.
3. The Parties shall co-operate in matters of intellectual property.  They shall hold, upon request
of any Party, expert consultations on these matters, in particular, on activities relating to the existing
or to future international conventions on harmonization, administration and enforcement of
intellectual property and on activities in international organizations, such as the World Trade
Organization and the World Intellectual Property Organization, as well as relations of the Parties withany third country on matters concerning intellectual property.
4. The Parties may conclude further agreements exceeding the requirements of this Agreement
which are not contrary to TRIPS Agreement.
Article 24
Dumping
If a Party finds that dumping within the meaning of Article VI of the General Agreement on
Tariffs and Trade 1994 is taking place in trade relations governed by this Agreement, it may take
appropriate measures against that practice in accordance with Article VI of the General Agreement onTariffs and Trade 1994 and the Agreement on Implementation of Article VI of the General Agreement
on Tariffs and Trade 1994 under the conditions and in accordance with the procedure laid down in
Article 29 (Procedure for the Application of Safeguard Measures).
Article 25
General Safeguards
Where any product is being imported in such increased quantities and under such conditions
as to cause or threaten to cause:
(a) serious injury to domestic producers of like or directly competitive products in the
territory of the importing Party;  orWT/REG128/1
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(b) serious disturbances in any related sector of the economy or difficulties which could
bring about serious deterioration in the economic situation of a region;
the Party concerned may take appropriate measures under the conditions and in accordance with the
procedure laid down in Article 29 (Procedure for the Application of Safeguard Measures).
Article 26
Structural Adjustment
1. Exceptional measures of limited duration which derogate from the provisions of Article 3
(Customs Duties on Imports and Charges having Equivalent Effect) may be taken by any of the
Parties in the form of increased customs duties.
2. These measures may only concern infant industries, or certain sectors undergoing
restructuring or facing serious difficulties, particularly where these difficulties produce important
social problems.
3. Customs duties on imports applicable in the Party concerned to products originating in the
other Party introduced by these measures may not exceed 25 per cent ad valorem  and shall maintain
an element of preference for products originating in the other Party.  The total value of imports of the
products which are subject to these measures may not exceed 15 per cent of total imports of industrial
products from the other Party as defined in Chapter I during the last year for which statistics areavailable.
4. These measures shall be applied for a period not exceeding two years, unless longer duration
is authorized by the Joint Committee.  They shall cease to apply on 1 January 2001 at the latest.
5. No such measures can be introduced in respect of a product if more than three years have
elapsed since the entry into force of this Agreement or elimination of all customs duties and
quantitative restrictions or charges or measures having an equivalent effect concerning that product.
6. The Party concerned shall inform the other Party of any exceptional measures it intends to
take and, upon request of the other Party, consultations shall be held within the Joint Committee on
such measures and the sectors to which they apply prior their introduction.  When taking suchmeasures the Party concerned shall provide the Join t Committee with a schedule for the elimination of
the customs duties introduced under this Article.  This schedule shall provide for a phasing out of
these customs duties starting at the latest one year after their introduction.  The Joint Committee may
decide on a different schedule.
Article 27
Re-Export and Serious Shortage
Where compliance with the provisions of Articles 6 (Customs Duties on Exports and Charges
having Equivalent Effect) and 8 (Quantitative Restrictions on Exports and Measures having
Equivalent Effect) leads to:
(a) re-export towards a third country against which the exporting Party maintains for the
product concerned quantitative export restrictions, export duties or measures orcharges having equivalent effect;  or
(b) a serious shortage, or threat thereof, of a product essential to the exporting Party;WT/REG128/1
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and where the situations referred to above give rise or are likely to give rise to major difficulties for
the exporting Party, that Party may take appropriate measures under the conditions and in accordance
with the procedure laid down in Article 29 (Pro cedure for the Application of Safeguard Measures).
Article 28
Fulfilment of Obligations
1. The Parties shall take any general or specific measures required to fulfil their obligations
under this Agreement.  They shall see to it that the objectives set out in this Agreement are attained.
2. If a Party considers that the other Party has failed to fulfil an obligation under this Agreement,
the Party concerned may take appropriate measures under the conditions and in accordance with the
procedure laid down in Article 29 (Procedure for the Application of Safeguard Measures).
Article 29
Procedures for the Application of Safeguard Measures
1. Before initiating the procedure for the application of safeguard measures set out in the
following paragraphs of this Article, the Parties shall endeavour to solve any differences between
them through direct consultations.
2. In the event of a Party subjecting imports of products liable to give rise to the situation
referred to in Article 25 (General Safeguards) to an administrative procedure having as its purpose the
rapid provision of information on the trend of trade flows, it shall inform the other Party.
3. Without prejudice to paragraph 7 of this Article, a Party which considers resorting to
safeguard measures shall promptly notify the other Party thereof and supply all relevant information.
Consultations between the Parties shall take place without delay in the Joint Committee with a view to
finding a solution.
4.
(a) With regard to Articles 24 (Dumping), 25 (General Safeguards) and 27 (Re-Export
and Serious Shortage), the Joint Committee shall examine the case or the situation
and may take any decision needed to put an end to the difficulties notified by the
Party concerned.  In the case of the absence of such decision within thirty days of the
matter being referred to the Joint Committee the Party concerned may adopt the
measures necessary in order to remedy the situation.
(b) With regard to Article 28 (Fulfilment of Obligations), the Party concerned may take
appropriate measures after the consultations have been concluded or a period of three
months has elapsed from the date of the first notification to the other Party.
(c) With regard to Articles 20 (Rules of Competition concerning Undertakings) and
21 (Staid Aid), the Party concerned shall give the Joint Committee all the assistancerequired in order to examine the case and, where appropriate, eliminate the practice
objected to.  If the Party in question fails to put an end to the practice objected to
within the period fixed by the Joint Committee or if the Joint Committee fails to reach
an agreement within forty five days of the matter being referred to it, the Party
concerned may adopt the appropriate measures to deal with the difficulties resultingfrom the practice in question.WT/REG128/1
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5. The safeguard measures taken shall be immediately notified to the other Party.  They shall be
restricted with regard to their extent and to their duration to what is strictly necessary in order to
rectify the situation giving rise to their application and shall not be in excess of the injury caused by
the practice or the difficulty in question.  Priority shall be given to such measures which will least
disturb the functioning of this Agreement.
6. The safeguard measures taken shall be the subject of periodic consultations within the
Joint Committee with a view to their relaxation as soon as possible, or abolition when conditions no
longer justify their maintenance.
7. Where exceptional circumstances requiring immediate action make prior examination
impossible, the Party concerned may, in the cases of Articles 20 (Rules of Competition concerning
Undertakings), 21 (State Aid) and 30 (Balance- of-Payments Difficulties), apply forthwith the
provisional measures strictly necessary to remedy the situation.  The measures shall be notified
without delay and consultations between the Parties shall take place as soon as possible within the
Joint Committee.
Article 30
Balance-of-Payments Difficulties
1. The Parties shall endeavour to avoid the imposition of restrictive measures including
measures relating to imports for balance-of-payments purposes.
2. Where one of the Parties is in serious balance-of-payments difficulties, or under imminent
threat thereof, the Party concerned may, in accordance with the relevant provisions of the General
Agreement on Tariffs and Trade 1994 and with Article VIII of Articles of the Agreement ofInternational Monetary Fund adopt restrictive measures, including measures related to imports, which
shall be of limited duration and may not go beyond what is necessary to remedy the
balance-of-payments situation.  The measures shall be progressively relaxed as balance-of-payments
conditions improve and they shall be eliminated when conditions no longer justify their maintenance.
The Party concerned shall inform the other Party forthwith of their introduction and, whenever
practicable, of a schedule for their removal.
Article 31
Evolutionary Clause
1. Where a Party considers that it would be useful in the interests of the economies of the Parties
to develop and deepen the relations established by this Agreement by extending them to fields not
covered thereby, it shall submit a reasonable request to  the other Party.  The Parties may instruct the
Joint Committee to examine such a request and, where appropriate, to make recommendations,
particularly with a view to opening negotiations.
2. Agreements resulting from the procedure referred to in paragraph 1 will be subject to the
ratification or the approval by the Parties in accordance with their own internal legal requirements.WT/REG128/1
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CHAPTER IV
Institutional and Final Provisions
Article 32
The Joint Committee
1. The Joint Committee is hereby established and shall consist of representatives of the
Government of the Republic of Hungary on the one ha nd, and of representatives of the Government of
the Republic of Estonia, on the other hand.
2. The Joint Committee shall be responsible for the administration of this Agreement and shall
ensure its proper implementation.
3. For the purpose of the proper implementation of this Agreement, the Parties shall exchange
information and, upon request of any Party, shall hold consultations within the Joint Committee.  TheJoint Committee shall keep under review the possibility of further removal of the obstacles to trade
between the Parties.
4. The Joint Committee may, in accordance with the provisions of paragraph 3 of Article 33
(Procedures of the Joint Committee), take decisions in  the cases provided for in this Agreement.  On
other matters the Joint Committee may make recommendations.
Article 33
Procedures of the Joint Committee
1. For the proper implementation of this Agreement the Joint Committee shall meet whenever
necessary but at least once a year.  Each Party may request that a meeting be held.
2. The Joint Committee shall act by common agreement.3. If a representative in the Joint Committee of a Party has, under the reservation, accepted a
decision subject to the fulfilment of internal lega l requirements the decision shall enter into force, if
no later date is contained therein, on the day the lifting of the reservation is notified.
4. For the purpose of this Agreement the Joint Committee shall adopt its rules of procedure
which shall, inter alia , contain provisions for convening meetings and for the designation of the
Chairman and the term of office.
5. The Joint Committee may decide to set up such subcommittees and working groups as it
considers necessary to assist it in accomplishing its tasks.
Article 34
Customs Unions, Free-Trade Areas and Frontier Trade
This Agreement shall not prevent the maintenance or establishment of customs unions,
free-trade areas or arrangements for frontier trade to the extent that these do not negatively affect the
trade between the Parties and, in particular, the provisions concerning rules of origin provided for by
this Agreement.WT/REG128/1
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Article 35
Annexes, Protocols and Amendments
1. Annexes and the Protocol to this Agreement are an integral part of it.2. The Joint Committee may decide to amend the Annexes and Protocol to this Agreement.  In
this case the amendments shall enter into force on the date of a receipt of the latter diplomatic note
confirming that their internal legal requirements fo r the entry into force of the amendments have been
fulfilled.
Article 36
Entry into Force
1. This Agreement shall enter into force on the first day of the second month following the date
of receipt of the latter diplomatic note confirming th at their respective internal legal requirements for
the entry into force of this Agreement have been fulfilled.
2. This Agreement shall be applied provisionally from 1 January 1999.
Article 37
Validity and Termination
1. This Agreement is concluded for an unlimited period of time.
2. Either Party may terminate this Agreement by a written notification to the other Party.  The
termination shall take effect on the first day of the seventh month following the date on which the
notification was received by the other Party.
IN WITNESS WHEREOF the undersigned plenipotentiaries, being duly authorized thereto,
have signed this Agreement.
Done at Budapest this fourth day of Novemb er one thousand nine hundred and ninety eight,
in two originals, each in the English language.
For the Republic of Hungary For the Republic of EstoniaWT/REG128/1
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RECORD OF UNDERSTANDINGS
1. The Parties shall continue in their efforts with a view to achieve further liberalization of trade
in agricultural products within the framework of their respective agricultural policies and theirinternational commitments.
2. Measures concerning veterinary and phytosanitary control will be harmonized with the
European Union legislation and between the Parties.
3. With reference to Article 10 paragraph 3 customs duties on imports may be introduced by
Estonia during the first year following the entry into force of this Agreement on the basis of thedecision of the Joint Committee.
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