WT/REG378/2  
 
12 January 2018 
(18-0393) Page: 1/2 
Committee on Regional Trade Agreements  Original: English  
 
FREE TRADE AGREEMENT  BETWEEN TURKEY AND THE REPUB LIC OF MOLDOVA  
(GOODS)  
QUESTIONS AND REPLIE S 
 The following communication, dated 12 January 2018, is being circulated at the request of 
the delegations of Turkey and the Republic of  Moldova.  
 
_______________  
 
 
Question s from the delegation of Japan  
 
Rules of origin  
 
1.1.  According to paragraph 3.15 of the Factual  Presentation , Annex I of the Turkey -
Moldova FTA  on rules of origin shall be applied temporarily and shall be replaced by the 
rules of origin in the preferential trade arrangement between Moldova and the EU and 
its related annexes.  
a. In case of the replacement, does all PSR of the EU - Moldova FTA replac e PSR of 
the Turkish - Moldova FTA?  
 Yes. Starting with 1 October 2017, the rules of origin applied in the FTA between the 
Republic of Moldova and Turkey will be those from the PEM Convention, without exceptions.  
 
b. If the PSRs to be replaced are not all , we would like to know which PSRs will be 
excluded from the replacement  (in other words, which lines will be excluded 
based on HS code basis) , as well as  the reasons for the limitation (e.g. is one of 
the reasons to keep consistency with the other agreement ?). 
 Please see previous answer.  
 
1.2.  According to paragraph 3.19 of the Factual Presentation , the cumulation 
mechanism between EU and the Parties is introduced in the Turkey -Moldova FTA, and 
we understand that this cumulation mechanism is based on the system o f Pan -Euro -
Mediterranean cumulation of origin.  
a. Under  this system, are all products subject to "diagonal cumulation"?  
 The application of cumulation should be in accordance with Article 3 of Annex I of the 
Convention. The cumulation can be applied within the agreement from the date indicated in the 
notice published in the Official Journal of the European Union (C Series) for all products without 
exception.  
 
b. If target product s are limited, we would li ke to know which products (HS code 
basis) are not subject of "diagonal cumulation"  and the reasons for the 
limitation.  
 Please see previous answer.  WT/REG378/2  
 
- 2 - 
 
  c. Before  adopting "diagonal cumulation" under the system of Pan -Euro -
Mediterranean cumulation of origin, did Turkey and Moldova have consult ations  
with a targeted country (i.e . the EU in this case) on issues, including  
administrative cooperation after the adoption  of the system ? 
 Please see previous answer.  
 
d. Is it necessary to notify a target country of the adoption of "diagonal 
cumulation" after the adoption  of the system?  
 Please see previous answer.  
 
1.3.  According to paragraph 3.19 of the Factual Presentation , in or der to use the 
cumulation mechanism, Turkey, Moldova and the EU have arrangements which allow for 
adequate administrative cooperation procedures ensuring full implementation of the 
cumulation mechanism as well as certification and verification of origin of  the products.  
 If it is necess ary at the time of verification to confirm the originating status of the 
originating materials produced in the E U, w hat kind of procedure s will the Parties take 
under the adequate administrative cooperation ? 
 
 If the exportin g party (Turkey or Moldova) deems necessary to check the real origin of 
materials incorporated into a product exported by the EU to its country, it may send subsequent 
verification request for the proof of origin issued by the EU for this material to the E U in line with 
the provisions of its FTA with the EU.  
 
 The verification procedure of this certificate is foreseen in TITLE VI (Arrangements for 
Administrative Co -Operation) of Annex I of Turkey -Moldova FTA as well as those in FTAs of Turkey 
and Moldova w ith the EU.  
 
Question from the delegation of Thailand  
 
Structural Adjustment   
 
1.4.  Paragraph 3.29: The Parties may take exceptional measures of limited duration in 
the form of increased customs duties for the protection of infant industries, or certain 
sectors undergoing restructuring or facing serious difficulties, particularly where th ese 
difficulties produce important social problems (Article 18). Customs duties introduced 
by these measures may not exceed 25% ad valorem and shall maintain an element of 
preference for products originating in the other Party. The total value of imports o f the 
products subject to such measures may not exceed 15% of total imports of industrial 
products during the last year for which statistics are available. These measures shall be 
applied for a period not exceeding five years unless a longer duration is au thorized by 
the Joint Committee and shall cease to apply at the latest on the expiry of the transition 
period. No such measures can be introduced in respect of a product if more than three 
years have elapsed since the elimination of all duties and quantita tive restrictions or 
charges or measures having an equivalent effect concerning that product.  
 What are the serious difficulties that may produce important social problems? 
Please give an example of both Parties.  
 
 The measures mentioned above may only concern infant industries, or certain sectors 
undergoing restructuring or facing serious difficulties, particularly where these difficulties produce 
important social problems. For example, a reduction in import taxes for certain sector s may create 
deterior ation in employment conditions. Imperfections in the labour market, when combined with 
adjustment costs and unexpected events, could result in an increase in unemployment for that 
sector. In such cases, structural adjustment measures have a role for tempor ary protection and 
flexibilities. A temporary increase in import taxes may thereby draw workers out of unemployment 
into the import -competing sector.  
 
__________