WORLD TRADE  
ORGANIZATION  WT/REG181/1 
22 December 2004 
 
 (04-5633) 
Committee on Regional Trade Agreements Original:   English 
 
  
FREE TRADE AGREEMENT BETWEEN ALBANIA AND BOSNIA AND HERZEGOVINA 
  
 The following communication, dated 9 December 2004, is being circulated at the request of 
the Delegation of Albania.
1 
_______________ 
  
FREE TRADE AGREEMENT BETWEEN  
THE REPUBLIC OF ALBANIA AND BOSNIA AND HERZEGOVINA 
  
 The Republic of Albania and Bosnia and Herzegovina  (hereinafter "the Contracting Parties"), 
 
 Recalling  their intention to participate actively in  the direction of economic integration in 
Europe and expressing their preparedness to co-operate in seeking ways and means to strengthen that process,  
 Reaffirming  their firm commitment to contribute st rengthening of the European integration 
processes in Southeast Europe, 
 
 Reaffirming  their commitments to the principles of a market economy and respect for 
fundamental principles of democracy and human rights, 
 
 Resolved to eliminate progressively the obstacles to their mutual trade in accordance with the 
provisions of the General Agreement on Tariff s and Trade (hereinafter “GATT 1994”) and the 
Agreement establishing the World Trade Organisatio n (hereinafter “WTO”), Bosnia and Herzegovina 
having objective to become a member of the WTO,  
 Firmly convinced  that this Agreement will improve mutually beneficial trade co-operation, 
and contribute to the process of integration in Europe, 
 
 Considering  that no provision of this Agreement may be interpreted as exempting the 
Contracting Parties from their obligations  under other international agreements,  
 
 Have Agreed  as follows: 
                                                     
 
1 The Annexes of the Agreement have been submitted to the Secretariat for consultation by interested 
Members (office 1174). WT/REG181/1 
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 Article 1 
 
Objectives
 
 
1. The Contracting Parties shall gradually establis h a free trade area on substantially all their 
bilateral trade in a transitional period ending on 31  December 2007, in accordance with the provisions 
of this Agreement and in conformity with Article XXIV of the GATT 1994 and the WTO. 
2. The objectives of this Agreement are: 
(a) to promote through the expansion of mutual trade the harmonious development of 
economic relations between the Contractin g Parties and thus to foster in the 
Contracting Parties the advance of econom ic activity, the improvement of living 
standards, increase of employment, and financial stability; 
(b) to provide fair conditions of competition fo r trade between the Co ntracting Parties; 
(c) to contribute by the removal of barriers to  trade, to the harmonious development and 
expansion of world trade; 
(d) to improve trade and co-operation of the Co ntracting Parties in the third countries 
markets. 
Article 2 
 
Basic Duties  
 1. For each product the basic duty to which the su ccessive reductions set out in this Agreement 
are applied shall be the Most Favoured Nation rate of duty in force on the date of entry into force of 
this Agreement. 
2. If, after the date of entry into force of this Agreement, any tariff reduction is applied on an 
erga omnes  basis, in particular reductions resulting from the agreement on tariffs concluded by the 
GATT direction of the Uruguay Round of multilateral ne gotiations on trade, such reduced duties shall 
replace the basic duty referred to in paragraph 1 of this Article as from the date when such reductions 
are applied. 
3. In Bosnia and Herzegovina, the reduced duties calculated in accordance with paragraph 2 of 
this Article shall be rounded to the first decimal place.  
4. In the Republic of Albania, the reduced duties , calculated in accordance with paragraph 2 of 
this Article, shall be rounded without decimal number s, in accordance with arithmetical rules. This, 
decimal additions from 0.1 - 0.4 should be avoided, while decimal 0.5 - 0.9 shall increase the 
principal by 1.  
5. The Contracting Parties shall communicate to  each other their respective basic duties.  
  WT/REG181/1 
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 CHAPTER I 
 
INDUSTRIAL PRODUCTS 
   
Article 3 
 
Scope  
 
1. The provisions of the Chapter I of this Agreement, shall apply to industrial products 
originating in the Contracting Parties. 
2. The term "industrial products" for the purposes of this Agreement refers to the products listed 
in Chapters 25 to 97 of the Harmonised Commodity Description and Coding System, with the 
exception of the products listed in Annex 1 of this Agreement. 
Article 4 
 
Customs Duties On Imports  
 
1. No new customs duties on imports, charges having an effect equivalent to customs duties and 
other import duties of a fiscal nature  shall be introduced in trade in  industrial products between the 
Contracting Parties, as from the date of entry into force of this Agreement. 
2. Customs duties on imports, charges having equivalent effect to customs duties and other 
import duties of a fiscal nature applicable to industr ial products originating in the Republic of Albania 
and in Bosnia and Herzeg ovina shall be reduced progressively, as follows: 
 - on the date of entry into force of this Agreement  to 80% of their value 
 
 - on 1 January 2004  to 60% of their value   - on 1 January 2005  to 40% of their value 
   - on 1 January 2006  to 20% of their value 
 
 - on 1 January 2007  fully abolished. 
 
Article 5 
 
Customs Duties On Exports And Charges Having Equivalent Effect
 
 1. No new customs duties on exports or charges havi ng equivalent effect to customs duties, and 
other export duties of a fiscal nature shall be in troduced in trade between the Contracting Parties, as 
from the date of entry into force of this Agreement.  
2. The Contracting Parties shall abolish all customs duties on exports or charges having 
equivalent effect to custom duties, and other export dut ies of a fiscal nature on the date of entry into 
force of this Agreement. 
   WT/REG181/1 
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 Article 6 
 
Quantitative Restrictions On Exports And Impor ts And Measures Havi ng Equivalent Effect
 
 
1. No new quantitative restrictions on exports and imports or meas ures having equivalent effect 
shall be introduced in trade between the Contracting Par ties as from the date of entry into force of this 
Agreement. 
2. All quantitative restrictions on exports and im ports and measures having equivalent effect 
shall be abolished on the date of entry into force of this Agreement. 
Article 7 
 
Technical Barriers To Trade  
 
1. The rights and obligations of the Contracting Pa rties, relating to technical barriers to trade 
(technical regulations, standards and conformity assessment procedures) and the respected measures, shall be governed by the WTO Agreemen t on Technical Barriers to Trade. 
2. The Contracting Parties shall co-operate an d exchange information in the field of 
standardisation, metrology, conf ormity assessment a nd accreditation with the aim of eliminating 
technical barriers to trade. 
3. Each Contracting Party, upon request of the other Contracting Party, shall provide 
information and in individual cases on sta ndards, technical norms or related measures. 
4. The Contracting Parties shall conclude an agreement on mutual recognition in the field of 
conformity assessment, in the spirit of the re commendations of the WTO Agreement on Technical 
Barriers to Trade. 
 
CHAPTER II 
 
  AGRICULTURAL PRODUCTS  
 
Article 8 
 
Scope
 
 
1. The provisions of the Chapter II of this Ag reement shall apply to agricultural products 
originating in the Contracting Parties. 
2. The term "agricultural products" for the purposes of this Agreement refers to the products 
listed in Chapters 1 to 24 of the Harmonised Commodity Description and Coding System, including 
products listed in Annex 1 of this Agreement.  
  Article 9  
 
Customs Duties On Imports  
 
1. No new customs duties on imports, charges having an effect equivalent to customs duties and 
other import duties of a fiscal nature shall be intr oduced in trade in agricultural products between the 
Contracting Parties as from the date of  entry into force of this Agreement.  WT/REG181/1 
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 2. Customs duties on imports, charges having an e ffect equivalent to customs duties and other 
import duties of a fiscal nature applicable to ag ricultural products specif ied in Annex 2 to this 
Agreement, originating in the Republic of Albania a nd in Bosnia and Herzegovina, shall be abolished 
on the date of entry into force of this Agreement. 
3. Customs duties on imports, charges having an e ffect equivalent to customs duties and other 
import duties of a fiscal nature applicable to ag ricultural products specif ied in Annex 3 to this 
Agreement, originating in the Republic of Alba nia and in Bosnia and Herzegovina, shall be 
progressively reduced, as follows: 
 - on the date of entry into force of this Agreement  to 90% of their value 
 
 - on 1 January 2004  to 80% of their value 
 
 - on 1 January 2005  to 70% of their value 
 
 - on 1 January 2006  to 60% of their value   - on 1 January 2007  to 30% of their value 
 
 - on 1 January 2008  fully abolished. 
   
Article 10 
 
Customs Duties On Exports And Charges Having Equivalent Effect
 
 
1. No new customs duties on exports or charges havi ng equivalent effect to customs duties, and 
other export duties of a fiscal nature shall be in troduced in trade between the Contracting Parties, as 
from the date of entry into force of this Agreement.  
2. The Contracting Parties shall abolish all customs duties on exports or charges having 
equivalent effect to custom duties, and other export dut ies of a fiscal nature on the date of entry into 
force of this Agreement. 
Article 11 
 
Quantitative Restrictions On Exports And Impor ts And Measures Havi ng Equivalent Effect  
 
1. No new quantitative restrictions on exports and imports or meas ures having equivalent effect 
shall be introduced in trade between the Contracting Par ties as from the date of entry into force of this 
Agreement. 
2. All quantitative restrictions on exports and im ports and measures having equivalent effect 
shall be abolished on the date of entry into force of this Agreement.  
  Article 12  
 
Agricultural Policy  
 
1. Without prejudice to the provisions under Article 2 of this Agreement, the provisions of the 
Chapter II of this Agreement shall not restrict in an y way the pursuance of the respective agricultural 
policies of the Contracting Parties or the taking of  any measures under such policies, including and 
the implementation of the results of the Uruguay Round agreements. WT/REG181/1 
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 2. The Contracting Parties shall notify to the Joint Committee changes in their respective 
agricultural policies pursued or measures which may affect the conditions of trade in agricultural 
products between them. On the request of either Contracting Party, prompt consultations shall be held 
within the Joint Committee, to examine the situation. 
Article 13 
 
Specific Safeguards
 
 
 Notwithstanding other provisions of this Agre ement, and in particular Article 26 of this 
Agreement, and given the particular sensitivity of the agricultural products, if imports of products originating in a Contracting Party, which are subj ect to concessions granted under this Agreement, 
cause serious disturbances to the markets of th e other Contracting Party, the Contracting Party 
concerned shall immediately enter into consultation s to find an appropriate solution. Pending such 
solution, the Contracting Party concerned may take the measures it deems necessary. The type and 
duration of the measure should not go beyond what is strictly necessary to remedy the situation. 
 
Article 14 
 
Sanitary And Phytosanitary Measures
 
 
1. The Contracting Parties shall apply their regulati ons in sanitary and phytosanitary matters in a 
non-discriminatory fashion and shall not introduce any 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 WTO Agreement on the Application of Sanitary and Phytosanitary Measures. 
3. The phytosanitary measures and the work of th e plant protection service will be in accordance 
with the WTO Agreement on the Application of Sanitary and Phytosanitary Measures. 
4. The measures related to the veterinary and phytosanitary control between the Contracting 
Parties shall be harmonised in accordance with the legislation of the EU.  
5. The Contracting Parties undertake the obligation to exchange regularly the information on the 
level of sanitary and phytosanitary protection of animals, plants and products. 
 
CHAPTER III 
 
  GENERAL PROVISIONS  
 
Article 15 
 
Rules Of Origin And Co-Operation In Customs Administration  
 
1. The Contracting Parties agree to apply the ha rmonized Pan European preferential rules of 
origin in the mutual trade, including all existing and further amendments thereto. In case the Pan 
European rules of origin are amended, the Joint Committee shall make a decision on amending rules 
of origin. 
2. Protocol 1 to this Agreement lays down the rules of origin and related methods of 
administrative co-operation.  WT/REG181/1 
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 3. The Contracting Parties shall take appropriat e measures, including regular reviews by the 
Joint Committee and arrangements for administra tive co-operation, to ensure effective and 
harmonised application of the European rules of origin and Articles 2, 4 to 7, 9 to 12, 16, 26 to 28 of 
this Agreement, 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. 
Article 16 
 
Internal Taxation  
 
1. The Contracting Parties shall refrain from any meas ure or practice of an internal fiscal nature 
establishing, whether directly or indirectly, discrimination betwee n the products originating in the 
Contracting Parties. 
2. Products exported to the territory of one of the Contracting Parties may not benefit from 
repayment of internal taxation in excess of the amount of indirect taxation imposed on them. 
Article 17 
 
General Exceptions  
 
 This Agreement shall not preclude prohibitions or  restrictions on imports, exports or traffic of 
goods in transit justified on grounds of public morality, public order or public security; the protection 
of health and life of humans, animals or plants; the protection of national treasu res of artistic, historic 
or archaeological value; the protection of intellectual property or the rules relating to gold and silver, 
the protection of environment or the conservation of  exhaustible natural resources, if such measures 
are applied in conjunction with restrictions on dome stic production or consum ption. Such prohibitions 
or restrictions shall not, however, constitute a mean of arbitrary discrimination or a disguised 
restriction on trade between the Contracting Parties.  
Article 18 
 
Security Exceptions
 
 
 Nothing in this Agreement shall prevent a Contracting Party from taking any appropriate 
measure which it considers necessary:  
(a) to prevent the disclosure of information cont rary 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, ammun ition and implements of war, provided 
that such measures do not impair the conditions of competition in respect of 
products not intended for specifically milita ry 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 explosive devices; or 
(iii) taken in time of war or other serious international tension.  WT/REG181/1 
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   Article 19 
 
State Monopolies
 
 
1. The Contracting Parties shall adjust progressively any state monopoly of a commercial 
character so as to ensure that by the date of en try into force of this Ag reement, no discrimination 
regarding the conditions under which goods are proc ured and marketed exists between nationals of 
the Contracting Parties.  
2. The Joint Committee shall be informed about the measures adopted to implement this 
objective. 
3. The provisions of this Article shall appl y to any body through which the competent 
authorities of the Contracting Parties, in law or in  fact, either directly or indirectly supervise, 
determine or appreciably influence imports or exports between the Contracting Parties. These 
provisions shall likewise apply to monopolies delegated by the State to other bodies. 
  Article 20  
 
Payments  
 
1. Payments in freely convertible currencies relati ng to trade in goods between the Contracting 
Parties and the transfer of such payments to the te rritory of the Contracting Party where the creditor 
resides shall be free from any restrictions.  
2. The Contracting Parties shall refrain from any fo reign exchange or administrative restrictions 
on the grant, repayment or acceptance of short or  medium term credits to trade in goods in which 
person residing in one of the Contracting Parties participates.  
3. Notwithstanding the provisions of paragraph 2 of  this Article, all measures concerning current 
payments connected with the movement of goods shall be in conformity with the conditions laid down 
under Article VIII of the Agreement of the Intern ational Monetary Fund and shall be applied on a 
non-discriminatory basis. 
Article 21 
 
Rules Of Competition C oncerning Undertakings  
 
1. The following are incompatible with the proper functioning of this Agreement insofar as they 
may negatively affect trade between the Contracting Parties: 
(a) all agreements between undertakings, decisions by associations of undertakings or 
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 whole territory of 
one of the Contracting Parties or in a 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 Contracting Parties grant special or 
exclusive rights. Undertakings entrusted with the oper ation of services of general economic interest or 
those having the character of a revenue-producing monopoly, shall be subject to provisions of  WT/REG181/1 
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 paragraph 1 of this Article insofar as the applic ation of these provisions does not obstruct the 
performance, in law or in fact, of the pa rticular public tasks assigned to them. 
3. With regard to products referred to in Chap ter II of this Agreement the provisions of 
paragraph 1 a) of this Article shall not apply to such agreements, decisions and practices which form 
an integral part of a national market organisation. 
4. If either Contracting 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 Contracting Party or material injury to its  domestic industry, it may take appropriate measures 
under the conditions and in accordance with the proce dure laid down in Article 30 of this Agreement. 
Article 22 
 
State Aid  
 
1. Any aid granted by a Contracting Party or through state resources in any form whatsoever 
which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, insofar as it may affect trad e between the Contracting Parties, be incompatible 
with the proper functioning of this Agreement. 
2. For agricultural products the provisions of paragraph 1 of this Article shall comply with the 
relevant WTO Agreements. 
3. The Contracting 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 to the other Contracting Party, up on request, information on aid schemes and on 
particular individual cases of state aid.  
4. If a Contracting Party considers that a particular practice: 
- is incompatible with the terms of  paragraph 1 of this Article, or 
- causes or threatens to cause serious prejudice to the interest of that Contracting Party or 
material injury to its domestic industry, 
 it may take appropriate measures under the conditions of and in accordance with the 
provisions laid down in Article 30 of this Agreement. 
 
5. Such appropriate measures may only be taken in conformity with the procedures and under 
the conditions laid down by the Agreement estab lishing WTO, particularly the GATT 1994 and any 
other relevant instrument negotiated under thei r auspices, which are applicable between the 
Contracting Parties. 
Article 23 
 
Public Procurement
 
 1. The Contracting Parties consider the liberali zation of their respective public procurement 
markets as an objective of this Agreement. The Contracting Parties aim at opening up of the award of 
public procurement on the basis of non-discrimination and reciprocity. WT/REG181/1 
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 2. The Contracting Parties will progressively de velop their respective rules, conditions and 
practices on public procurement and shall grant su ppliers of the other Contracting Party access to 
contract award procedures on their respective pub lic procurement markets not less favourable than 
that accorded to companies of any third country.  
3. The Joint Committee shall examine developments related to the achievement of the objectives 
of this Article and may recommen d practical modalities of implementing the provisions of paragraph 
2 of this Article so as to ensure free access, transparency and full balance of rights and obligations. 
During the examination referred to this paragraph from th is article, the Joint Committee may consider, 
especially in the light of international regulati ons in this area, the possibility of extending the 
coverage and/or the degree of the market opening provided for in paragraph 2 of this Article. 
4. The Contracting Parties shall en deavour to accede to the relevant Agreements negotiated 
under the auspices of the GATT 1994 and the Agreement establishing the WTO. 
Article 24 
 
Intellectual Property Rights
 
 
1. The Contracting Parties shall grant and ensure adequate and effective protection of 
intellectual property rights on a non-discriminatory ba sis, including effective measures for enforcing 
such rights against infringement, and particularly against counterfeiting and piracy. The Contracting 
Parties agree to comply with the substantive standards of the multilate ral agreements listed in Annex 4 
of this Agreement. 
2. For the purpose of this Agreement the term "i ntellectual property" refers to: protection of 
copyright and related rights, including computer programs and databases, the rights of inventors, 
design creators, the patent rights an d inventions or utility models, trade marks, industrial designs and 
topographies of integrated circuits, geographical indications including mark of origin, as well as 
undisclosed information including “know-how”. 
 
3. In fulfilment of their commitments under intern ational agreements and legislation in the field 
of intellectual property rights, the Co ntracting Parties to this Agreemen t shall not grant to nationals of 
the state of the other Contracting Party treatment le ss favourable than that accorded to nationals of 
any third state.  
4. The Contracting Parties shall co- operate in matters of intellectua l property. Upon request of a 
Contracting Party, they shall hold expert consulta tions on these matters, in particular on activities 
relating to the existing or to future internat ional conventions concerning the harmonisation, 
administration and enforcement of intellectual property and on activities in international 
organisations, such as the WTO, World Intellectual Property Organisation, as well as on the relations 
of the Contracting Parties w ith any third country on intellectual property matters. 
5. The implementation of this article shall be re gularly assessed by the Contracting Parties. 
Upon difficulties in trade in relation with the rights  of intellectual property, any of the Contracting 
Parties may request urgent co nsultations for finding mutually satisfactory solution.  WT/REG181/1 
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   Article 25  
 
Antidumping And Countervailing Measures  
 
 Nothing in this Agreement shall prejudice or affect in any way the taking, by either 
Contracting Party of anti-dumping or countervailing  measures in accordance with the Agreement on 
Implementation of Article VI of the GATT 1994 and the Agreement on Subsides and Countervailing 
Measures. 
 
  Article 26  
 
General Safeguards  
 
 Where any product is being imported in such increased quantities and u nder conditions as to 
cause or threaten to cause: 
 
(a) serious injuries to domestic producers of lik e or directly compe titive products in the 
territory of the importing Contracting Party, or 
(b) serious disturbances in any related sector of the econom y or difficulties which could 
bring about serious deterioration in the economic situation of a certain region; 
the Contracting Party concerned may take appr opriate measures under the conditions and in 
accordance with the procedure laid down  in Article 30 of this Agreement. 
Article 27 
 
Structural Adjustment  
 1. Exceptional measures of limited duration which are not in accordance with the provisions of 
Article 4 of this Agreement may be taken by any of  the Contracting 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, part icularly where these diffi culties produce important 
social problems. 
3. Customs duties on imports applicable in one of the Contracting Parties to products originating 
in the other Contracting Party introduced in accord ance with the paragraphs 1 and 2 of this Article 
may not exceed 25% ad valorem  and shall maintain an element of preference in customs duties for 
products originating in the other Contracting Party.  The total value of imports of the products which 
are subject to these measures may not exceed 15% of total imports of industrial products from the other Contracting Party as defined in Chapter I of this Agreement, during the last year for which 
statistics are available.  
4. Temporary measures may be applied for a period not exceeding the transitional period 
determined in paragraph 1, Ar ticle 1 of this Agreement. 
5. The Contracting Party concerned shall inform the other Contracting Party of any exceptional 
measures it intends to take and, at the request of the other Contracting Party, consultations shall be 
held immediately within the Joint Committee on such  measures and the sectors to which they apply. 
When taking such measures the Contracting Party concerned shall provide the Joint Committee with a 
schedule for the elimination of the customs duties in troduced under this Artic le. This schedule shall WT/REG181/1 
Page 12  
 
 provide for a phasing out of these duties starting at the latest two years after their introduction, at 
equal annual rates. The Joint Committ ee may decide on a different schedule. 
  Article 28  
 
Re-Export And Serious Shortage
 
 
 Where compliance with the provisions of Articles 5 and 6 of this Agreement leads to: 
 
(a) re-export towards a third country agains t which the exporting Contracting Party 
maintains for the product concerned quantitative export restrictions, export duties or measures or charges having equivalent effect; or 
(b) a serious shortage, or threat thereof, of a product essential to the exporting 
Contracting Party;  
and where the situations referred to above give  rise or are likely to give rise to major 
difficulties for the exporting Contracting Party,  it may take appropriate measures under the 
conditions and in accordance with the procedures laid down in Article 30 of this Agreement.  
  Article 29  
 
Fulfilment Of Obligations
 
 
1. The Contracting Parties shall take any measures required to fulfil their obligations under this 
Agreement to ensure that the objectives set out in this Agreement are attained. 
2. If one Contracting Party considers that the ot her Contracting Party has failed to fulfil an 
obligation under this Agreement, the Contractin g Party concerned may take  appropriate measures 
under the conditions and in accordance with the proce dure laid down in Article 30 of this Agreement. 
Article 30 
 
Procedure For The Application Of Safeguard Measures  
 
1. Before initiating the procedure for the applica tion of safeguard measures set out in the 
following paragraphs of this Article , the Contracting Parties shall e ndeavour to solve any differences 
between them through direct consultations. 
2. In the event of either Contracti ng Party subjecting imports of products liable to give rise to 
the situation referred to in Article 26 of this Agre ement to an administrative procedure having as its 
purpose the rapid provision of information on the trade flows, it shall inform the other Contracting 
Party. 
3. (a) With regard to Articles 25, 26 and 28 of this Agreement, 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 Contracting Part y concerned. In the case of the absence 
of such decision within 30 days from the date of the matter being referred to the Joint 
Committee, the Contracting Party concerned may adopt the necessary measures in 
order to remedy the situation. 
 
(b) As regards Article 29 of this Agreement, the Contracting Party concerned may take 
appropriate measures after the consultations have been concluded or a period of three  WT/REG181/1 
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 months has elapsed from the date of the first written notification to the other 
Contracting Party. 
(c) With regard to Articles 21 and 22 of this Agreement, the Contracting Party concerned 
shall give the Joint Committee all the assist ance required in order to examine the case 
and, where appropriate, eliminate the practice objected to. If the Contracting 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 thirty 
working days of the matter being referred to it, the Contracting Party concerned may 
adopt the appropriate measures  to deal with the difficulties resulting from the practice 
in question. 
4. The safeguard measures taken shall be immediat ely notified to the other Contracting Party. 
With regard to their extent and to their duration, meas ures shall be limited to what is strictly necessary 
in order to rectify the situation giving rise to thei r application and shall not be in excess of the injury 
caused by the practice or the difficulty in question. Priority shall be given to  measures which will least 
disturb the functioning of this Agreement. The m easures taken by a Contracting Party against an 
action or an omission of the other Contracting Party may only affect the trade with that Contracting Party. 
5. The safeguard measures taken shall be the object  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.  
6. Where exceptional circumstances requiring immediate action make prior examination 
impossible, the Contracting Party concerned may, in the cases of Articles 25, 26 and 28 of this 
Agreement, apply forthwith the provisional measur es necessary to remedy  the situation. Those 
measures taken shall be notified to the other C ontracting Party without delay, and consultations 
between the Contracting Parties sh all take place as soon as possi ble within the Joint Committee. 
7. Without prejudice to paragraph 6 of this Article, a Contracting Party which considers 
resorting to safeguard measures shall promptly notify in writing th e other Contracting Party thereof 
and supply all relevant information. Consultations between the Contracting Parties shall take place 
without delay within the Joint Committee with a view to finding a solution acceptable to both 
Contracting Parties. 
  Article 31  
 
Balance Of Payments Difficulties
 
 
1. The Contracting Parties shall endeavour to avoid the imposition of restrictive measures 
including measures relating to imports for balance of payments difficulties.  
2. Where one of the Contracting Parties is in seri ous balance of payments difficulties, or under 
imminent threat thereof, the Contracting Party co ncerned may, in accordance with the conditions 
established under the GATT 1994 an d Article VIII of the Articles of  Agreement of the International 
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 rela xed as balance of payments conditions improve and 
they shall be eliminated when conditions no longe r justify their maintenance. The Contracting Party 
concerned shall inform the other Contracting Party forthwith of their introduction and, whenever 
practicable, of a time schedule for their removal. WT/REG181/1 
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   Article 32  
 
Evolutionary Clause
 
 
1. Where one Contracting Party considers that it would be useful in the interests of the 
economies of the Contracting Par ties to develop and deepen the relations established by this 
Agreement by extending them to fields not covere d thereby, it shall submit a reasoned request to the 
other Contracting Party. The Joint Committee shall examine such request and, where appropriate, 
shall make recommendations, particularly  with a view to opening negotiations. 
2. Agreements resulting from the procedure referred to in paragraph 1 of this Article will be 
subject to ratification by the Contracting Parties in accordance with their internal legislation. 
Article 33 
 
Services And Investment  
 1. The Contracting Parties recognise the growing impo rtance of certain areas, such as services 
and investments. In their efforts to gradually develop and broaden their cooperation, in particular in 
the context of the European integration, the Cont racting Parties will co-ope rate with the aim of 
achieving a progressive liberalisation and mutual opening of markets for investments and trade in 
services, taking into account relevant provisions  of the General Agreement on Trade in Services. 
2. The matter related to the opening of markets for investments and trade in services shall be 
regulated by the specific  bilateral agreements.  
  Article 34  
 
Customs Unions, Free Trade Zones And Frontier Trade
 
 1. This Agreement shall not prevent the maintenance or establishment of customs unions, free 
trade zones or arrangements for fron tier trade to the extent that thes e do not negatively affect the trade 
regime between the Contracting Parties and in  part icular the provisions concerning rules of origin 
provided for by this Agreement. 
2. Upon request the Contracting Parties shall info rm each other of any agreement establishing 
customs union or free trade areas. 
  Article 35  
 
The Joint Committee
 
 1. A Joint Committee is hereby established and sha ll be composed of the representatives of the 
Contracting Parties. 
2. The implementation of this Agreement shall be supervised and administered by the Joint 
Committee. 
3. For the purpose of the proper implementation of this Agreement, the Contracting Parties shall 
exchange information and, at the request of either  Contracting Party, shall hold consultations within 
the Joint Committee. The Committee shall keep under review the possibility of further removal of the 
obstacles to trade between the Contracting Parties.  WT/REG181/1 
 Page 15 
 
 
 4. The Joint Committee may take decisions in the ca ses provided for in this Agreement. In other 
cases the Committee may make recommendations. 
Article 36 
 
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 Contracting Party may request that a meeting be held. 
2. The Joint Committee shall take decisions and recommendations by consensus. 
3. If the representative of either Contracting Party in the Joint Committee has accepted, under 
reservation, a decision subject to the fulfilment of internal legal requirements, that decision shall enter 
into force, if no later date is contained therein, on  the date of the receipt of a written notification as to 
the fulfilment of such requirements.  
4. For the purpose of this Agreement the Joint Committee shall adopt its rules of procedure 
which shall inter alia  contain provisions for conveying meeting and for the designation of the 
Chairman and his term of office. 
5. The Joint Committee may decide to set up subc ommittees and working groups as it considers 
necessary to assist it in accomplishing its tasks. 
  Article 37  
 
Amendments  
  Amendments to this Agreement may be propos ed by either Contracting Party and shall enter 
into force as set out in Ar ticle 40 of this Agreement. 
 
  Article 38  
 
Annexes And Protocols
 
 
1. Annexes and Protocols to this Agreem ent are an integral part of it. 
2. The Joint Committee may decide to amend the Annexes and Protocols to this Agreement in 
accordance with the provisions of paragr aph 2, Article 36 of this Agreement. 
3. In this case the amendments shall enter into for ce on the date of a receipt of the last written 
notification through diplomatic channels confirming th at the internal legal requirements for the entry 
into force of the amendmen ts have been fulfilled.  
Article 39 
 
Duration And Denunciation  
 
1. This Agreement is concluded for an indefinite period of time. 
2. Each Contracting Party may denounce this Agreement by a written notification through 
diplomatic channels to the other Contracting Party.  The denunciation shall enter into force on the first 
day of the seventh month after the date of  receipt the notification of denunciation. WT/REG181/1 
Page 16  
 
 3. The Contracting Parties agree that in the event of any Contracting Party becoming a member 
of the European Union, that Contracting Party will wi thdraw from this Agreement at the latest the day 
before membership takes effect and without any co mpensation to the other Contracting Party subject 
to the altered conditions of trade.  
Article 40 
 
Entry Into Force
 
 
 This Agreement is subject to ratification. It sha ll enter into force on the first day of the second 
month following the date of the receipt of the la st written notification by which Contracting Parties 
inform each other through diplomatic channels th at all necessary requirements foreseen by their 
internal legislation for the entry into forc e of this Agreement have been fulfilled. 
 
 
 IN WITNESS WHEREOF the undersigned plenip otentiaries, being duly authorized thereto, 
have signed this Agreement.  
 Done at _____________ this _____ day of _____________ 2002, in two originals in the 
Albanian, official languages of Bosnia and He rzegovina: Bosnian/Croa tian/Serbian and English 
languages, all texts being equally authentic. In case of divergence in  interpretation, the English text 
shall prevail.   
For the Republic of Albania      For Bosnia and Herzegovina 
 
 
__________