WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO WT/TPR/M/136/Add.2 
24 January 2005 
 (05-0273) 
Trade Policy Review Body 
25 and 27 October 2004 Original:  English/ 
                 anglais/                  inglés 
  
TRADE POLICY REVIEW 
EUROPEAN COMMUNITIES 
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Mrs. Puangrat Asavapisit (Thailand) 
 This document contains the a dvance written questions, and rep lies provided by the European 
Communities.1 
__________________________________________________________________________________  
Organe d'examen des politiques commerciales 
25 et 27 octobre 2004 
 
EXAMEN DES POLITIQUES COMMERCIALES 
COMMUNAUTÉS EUROPÉENNES 
Compte rendu de la réunion
 
Addendum  
Présidente:  S.E.  Mme Puangrat Asavapisit (Thaïlande)  
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par les Communautés européennes.1 
__________________________________________________________________________________  Órgano de Examen de las Políticas Comerciales 25 y 27 de octubre de 2004  
EXAMEN DE LAS POLÍTICAS COMERCIALES 
COMUNIDADES EUROPEAS 
Acta de la reunión
 
Addendum  
Presidente:  Excma. Sra Puangrat Asavapisit (Tailandia) 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por las Comunidades Europeas.1 
 
                                                      
1 In English only./En anglais seulement./En inglés solamente. WT/TPR/M/136/Add.2 
Page 3 
 
 
 ADVANCE WRITTEN QUESTIONS 
AND REPLIES  
  QUESTIONS FROM INDIA 
 
Issues related to EC expansion
 
 Q1.  India has existing trade with 10 new member s who have joined EC with effect from 1-5-04.  
This trade has been on the basis of their exis ting regulation governing registration or market 
approval of drugs and medicines, import of drugs and pharmaceuticals, patents and patent law. It 
is gathered that in respect of each of these matte rs, the existing regulations are likely to undergo 
substantial changes as per EC requirements.  It is requested to inform as to by when such changes 
are likely to be effected. There is an apprehen sion that existing liberal regulations in these 
countries can become protective and stringent.  Can EC give an indication regarding the likely 
direction of changes?  
A: New Member States were required to adopt th e existing Community acquis in the field of IP 
subject to specific provisions set out in the Act of Accession (see eg Annex II particularly OJ No. L 236, 23.9.2003, pages 342 - 344 and Annex IV par ticularly OJ No. L 236, 23.9.2003, page 797).  
These relate to Community Trade Marks (new Ar ticle 142a in Council Regulation (EC) No 40/94), 
Community designs (new Article 110a in Council Regulation (EC) 6/2002), Supplementary 
Protection Certificates (new Articles 19a and 20 (2) of Council Regulation (EEC) No 1768/92 and 
Council Regulation (EC) 1610/96) and the specific mechanism allowing for the prevention of parallel imports of patented pharmaceuticals into th e EU15 under certain circumstances (such as non-
availability of pharmaceutical product patents prior to 1991/92 in certain jurisdictions) .   
 
Q2. Upon EC’s expansion, there are some broad issues of concern for India. These are (i) 
increase in the tariff rates of acceding countries consequent upon their accession to the EC (for 
which compensation would be required), (ii) extens ion of textiles/clothing quotas to the acceding 
countries, and (iii) extension of trade defen ce measures invoked in the EC to the acceding 
countries and vice versa. How does EC propose to address these concerns.  
 
A: As concerns textiles the EC takes the view that no compensation is due for the geographical 
extension of already existing quotas. On overall te rms the benefits from free circulation within an 
expanded community of 25 members will in the medium and longer term far outweigh alleged short-
term disadvantages 
 
Q3. In the context of EC’s notification conseque nt to its expansion, we request information 
about the time frame in which EC would provide tari ff equivalents for goods which attract specific 
or mixed rates of duty? 
 
A: The EC is not in the position to convert th e specific or mixed rates of duty into tariff 
equivalents. In our view the specific duties are more transparent than ad valorem duties since AV 
duties are calculated as a percentage of the customs va lue, not always declared in a reliable manner by 
the operators.  Instead of using ad valorem equivalents, the EC has compared the duty rates applied for each 
tariff line in the NMSs and the EC for the actual im ports into the NMSs with in the reference period. 
Specific duties have been applied to trade vol umes and ad valorem duties to trade values. 
 WT/TPR/M/136/Add.2 
Page 4  
 
Q4. In Article XXIV of GATT 1994 there is no mention of enlargement or `expansion of an 
existing customs union. Could EC indicate the speci fic provisions in WTO acquis which mentions 
or permits enlargement or expansion of existing customs union?  
 
A: The EC does not agree with India that there is no mention in Article XXIV of enlargement or 
expansion of existing customs unions. While the id ea may have been implicit in GATT Article XXIV 
and referred to through the concep t of "adjustment", the introductory  part of the WTO Understanding 
on Article XXIV of GATT 1994 expl icitly refers to "enlargement" thus making the concept no longer 
implicit.  Q5. In India’s view, application of quantitative restriction to imports of textile products from 
third countries into the new member States fr om May 2004 constitutes new restrictions under 
Article 2.4 of the ATC.  These restrictions viol ate provisions of Article XI and XIII of GATT 1994 
and those of Article 2.4 of the ATC.  The introduction of any such otherwise GATT / WTO incompatible import restriction is not permitted by  Article XXIV of GATT 1994. Can EC indicate 
the relevant provision under the ATC or GATT 1994 which permits a member to extend the 
geographical scope of the existing quota? 
 
A: The justification to extend the regime as fro m enlargement and until the rest of the year 2004 
when quotas will be abolished was obviously to ensure  that the expanded internal market of EU 25 
could function satisfactorily, also in the interest of third countries. If the geographical scope of the 
already existing (i.e. not new) quotas for EU15 had not been expanded to cover the ten new member 
countries it might have been necessary to exclude im ports into the latter from free circulation within 
the EU and this would on overall term s have been detrimental to the interests of third countries and to 
trade. 
Incidentally EC does not consider the issue of  enlargement as falling within the remit of the 
ATC, which – and this should be noted – in article  2.4 foresees that restrictions may be introduced 
under  “… relevant GATT 1994 provisions ...”. Apart from the reference made to article 2.4 of the 
ATC EC is not arguing that ATC provisions cover th e question of enlargement since it is obvious that 
this issue falls outside the remit of the ATC, whic h was not conceived to cover such situations nor 
does it purport to do so.  Q6. Article XXIV:8 (a) of GATT 1994 specifies that a customs union shall be understood to mean the substitution of a single customs territory  for two or more customs territories. When ten 
new members acceded to EU 15, a single customs territory (EU 25) substituted the customs territory 
of EU 15 and that of the ten new member states. Would EC agree that EU-25 is a new customs union which is different from EU 15? If not, why not?  
 
A: The EC does not agree with India that the customs union including 25 Member States is a new customs union vis-à-vis the one with 15. Th is would be the case only if the EC customs union 
had dissolved and subsequently been  substituted for by the creation of a new entity (EU25). In reality, 
the EC customs union – incidentally the customs union of a Member of the WTO, i.e. the EC – has merely enlarged, just as when the members of th e EC customs union increased from 12 to 15 on 1 
January 1995. The EC Customs Union has not dissolved  nor been substituted. This is only the case for 
the ten new Member States’ individual customs terri tories since these entities ha ve been absorbed in 
the customs territory of the EC. As a result, the customs territory of the EC has been expanded by 
these countries and 25 Member States make up the single customs territory of the EC.  
 
NTBs related to SPS Issues
 
 Q7. The maximum level of benzoic acid (genera l level) permitted as food additive in cooked 
shrimps is 0.2 per cent as per the Directive of the European Commission. While the EC members WT/TPR/M/136/Add.2 
Page 5 
 
 
 namely, Netherlands, Belgium etc. are permitted to  use benzoic acid at a higher level (0.6%), 
Indian shrimps are permitted only 0.2%. EC is requested to explain the rationale behind this discriminatory treatment.  
 
A: Please refer to multiple previous correspondence on this issue. 
 
Q8. In the case of cooked shrimp, the maximu m level of preservatives permitted in EU is 2000 
mg/kg.  A higher level of 6000 mg/kg is allowed by EC for two species (caught in the European 
waters) of smaller shrimps (e.g. Crangon) which ca n only be peeled by hand and therefore present 
a higher risk of contamination. This is ho wever not applied to Indian shrimps such as 
Metapeanaeus Dobsonii and M. Brevicornis which co nstitute an important fishery in the west coast 
of India and grow to a maximum of 125 mm as against crangon which grow upto 80mm. It is requested to remove this type of NTB urgently. 
 
A: Please refer to multiple previous correspondence on this issue 
 
Q9. India has several concerns regarding SPS related issues as highlighted below: 
(i)  EC standards are often found to be higher than the international standards. Such regulations should be in conformity with the in ternational standards and in relation to the risk 
assessment and should not be used as NTBs for shutting out exports from developing  countries; 
(ii) Standards in a number of areas within  EC countries have not been harmonized, creating 
uncertainty and confusion within the exporting community;  
(iii)  The EC border inspection posts have also b een testing under the food safety standards for 
parameters which have not been specified in EC reg ulations. For example, the norm for minimum 
quantity to be tested for any food product to test negative for any bacteria is 25 gm; (iv) There is no adequate provision for appeal m echanism in case of rejection of consignments;  
(v) There is no adequate transition period before introduction of higher standards and before 
EC resorts to testing with more sophisticated equipments; (vi) The regulations on residues are not based on analysis but on the efficiency of analytical 
instruments.    We request  EC’s comments on how they plan to address the above concerns which are 
serious market access problems.  
 
A: All EC standards are based on scientific risk assessments, carried out by independent scientists.  In certain fields international standards  ar e not available.  In this case it is up to the EC to 
develop its own standards, bearing in mind the ri ght balance between scientific assessment and the 
least restrictive effect on trade.  However it should be taken into account that consumer protection is 
of utmost importance in the EC. 
 EC Member States have especially in the fiel d of food safety still a large responsibility due to 
subsidiarity.  In this respect, indeed in some fiel ds there is no harmonisation.  However, it should be 
noted that the Commission is taking its responsib ility and recognises that they sometimes may be 
difficult to deal with for trading partners.  In th is respect, EC has worked towards harmonisation e.g. 
in the field of ochratoxin A, and in the near future also in the field of microbiological standards.  On 
the other hand, sometimes harmonisation can distort tr ade and this should also be avoided at all times. 
 On the testing levels of prohibited or non- authorised substances, there has been some 
different interpretations by EC Member States in the past.  Some Member States interpreted it as the 
lowest possible analytical level the residue of the s ubstance could be traced at.  In  view of the fact 
that it concerns a substance that should not be used in the first place, it is justified that not any trace 
thereof should be found by an analytical method, even if advanced.  
 On 21 September last the EC Member States have voted in favour of a Decision laying down harmonised standards for the testing for certain resi dues in products of animal origin imported from WT/TPR/M/136/Add.2 
Page 6  
 
third countries.  This Decision provides for the possi bility to redispatch consignments that contain 
residues at or above the minimum required perfo rmance level (MRPL), whereas previously these 
consignments should have been destroyed.  It is  this MRPL that has been fixed as reference point, 
irrespective of the sensitivity of the analytical e quipment. This risk management measure has been 
taken in order to clarify the interpretation of the MRPL.  
 
Destruction of Consignments
 
 Q10. Several EC Member States have been not only holding up consignments of seafood exports 
from India to EC on the ground of detection of microbiological contamination and presence of 
antibiotics banned in EC but also destroying the same on  the ground of risk of public health in EC.  
In the past two years, there are at least two conf irmed destruction of marine consignments in 
France and one consignment of spices destroyed in Germany on account of contamination by 
chemical. This action of the EC Members seems to be discriminatory, arbitrary and unjustified on 
the following grounds: 
 The existing EC directive allows member stat es to return such consignments to the 
exporting country. Furthermore, EC Members actio n seems to be at variance with the Codex 
guidelines.  While developing its “The Guidelines for Exchange of Information Between Countries 
on Rejection of Imported Foods” C odex not only highlighted about information to be exchanged in 
cases of rejected consignments,  but also said a bout taking into account different options, namely, 
return of consignment to the country of export, re-export to a third country in case the same is 
acceptable to them or destruction.  
EC Member States therefore, should not destroy the consignments as per its own laws as 
the concepts of safety may vary across nations. Instead, it should return them to exporting country 
to be dealt with as per the laws in the orig inating country. India’s Competent Authority (Export 
Inspection Council) has already evolved procedures to handle products(as far as marine products 
are concerned), when such products are rejected by the EU Member countries and returned back to 
India.  
European Commission claim that while destroyi ng the consignments they are extending a 
national treatment as they also destroyed such consignments produced in the Member states. EU 
Members may require to destroy the products pr oduced in the EU because the producers always 
have the possibility to send such products to other Member states through the la nd route. In case of 
imported products they always have the option of re jecting the consignments before entering the 
EU and inform other border posts about such cons ignments so that these cannot be sent to other 
member countries. This may be facilitated  by furnis hing of a certificate by the consignor that the 
consignment shall not be re-routed or re-exported to  the EU countries. If necessary, the certificate 
could even be endorsed by the Government author ities or the Export Inspection Agencies. Thus the 
possibility of re-entry of rejected consignments to  the EU Member countries may be eliminated and 
hence destruction of the same can be avoided. 
When EU Member Country’s rejected consignmen ts are allowed to come back (as per EC 
regulations) to the originating country(EC) after getting refusal from a third country,  then there 
seem to be little justification why the same should  not hold good with any third country when the 
consignment is refused by EC. 
Arbitrary destruction without provision of re-testing/appeal mechanism deprives Indian 
agencies of the opportunity to identify the probl em for remedial action and regain their own 
products. What action does EC propose to take  to address this issue? Cooperation between 
testing/inspection institutions and laboratories for Mutual Recognition Agreements and initiatives 
for self certification can be a solution.  
We seek EC’s view on the above.  
A: On 21 September last the EC Member States have voted in favour of a Decision laying down harmonised standards for the testing for certain resi dues in products of animal origin imported from WT/TPR/M/136/Add.2 
Page 7 
 
 
 third countries.  This Decision provides for the possi bility to redispatch consignments that contain 
residues at or above the minimum required perfo rmance level (MRPL), whereas previously these 
consignments should have been destroyed.  It is  this MRPL that has been fixed as reference point, 
irrespective of the sensitivity of the analytical e quipment. This risk management measure has been 
taken in order to clarify the interpretation of the MRPL.  
 In addition to this, the new TRACES system, an  integrated computerised veterinary system, 
aims at providing an integrated structure for the existing computerised network linking veterinary 
authorities - Animo - and the upcoming database covering import requirements - SHIFT.  In this sense, all Border Inspection posts will know immediat ely what consignments have been refused and 
what samples need to be taken in the future. 
 
Spices consignments
 
 Q11. Under the EC regulations, chilli and chili products imported into EC need to be 
accompanied by a certificate to the effect that th e consignment is free from Sudan I to IV (added 
colour) and products which are found to be contam inated by Sudan dye is to be destroyed. The 
above decision was a sequel to a Rapid Alert Notific ation (RASFF) occasioned by the detection of 
Sudan 1 in a consignment of chili powder importe d into France in the year 2002. So far some 45 
rapid alerts (RASFFs) have been received with respect  to chilli or chilli products claimed to have 
originated from India. On this, Indi a has the following observations to make: 
 There is no evidence forthcoming from the au thorities issuing the RASFFs to show that the 
processor or the importer in EC  have exclusively u sed products of Indian origin or that they have 
imported chilli or chilli  products only from Indi a and that the samples were drawn from lots 
positively identified as shipped from India.  In a number of cases, though it is stated that  the material is of Indian origin, an Indian 
source is not named. 
In some RASFFs, the alleged presence of the offending substances is not quantified. In a 
number of RASFF, the reported presence of Sudan 1 are either at ppbs (parts per billion) or less 
than 15 ppm (parts per million) which would not enhance the colour of the chilli and hence tests 
would have a likelihood of showing a false positive result.   There were conflicting laboratory certificate reports from Italy and France.  In view of this, it is felt that to make the trade in Chilli and Chilli products less  restrictive, 
following steps could be taken by EC: 
Not to rush to publish a Rapid Alert (RASFF ) in those cases where the public health 
authority of the importing country claims to det ect presence of the offe nding substances at low 
levels. 
All samples testing positive for Sudan dye be su bjected to confirmatory tests in a reputed 
laboratory in another country of the EC. 
Where the confirmatory tests are positive, provide to the Spices Board of India an official sample 
and details of test methods employed to verify the findings to take appropriate corrective action. 
 Dispense with the system of mandatory cer tification of all exports of chilli/chilli products 
into EU in view of the fact that adulteration if any was a solitary instance.    We request EC’s response on these suggestions.  
 
A: Up to now there are more than 300 notifications concerning the presence of Sudan dyes in food products.   a) In 21% of the notifications, India is explicitely  identified as the origin of the product. India is 
the third most important exporter of chilli
 to the European Union but no consignements from Brazil 
and Hungary (before enlargement on 1/05/2004)  were found positive when  tested (Brazil and 
Hungary are respectively the first and the second exporte rs to the European union). India is also the 
most important exporter of curry  to the European Union.  WT/TPR/M/136/Add.2 
Page 8  
 
b) The tracing back of the precise origin of sp ices is extremely difficult because of the numerous 
exchanges on these particular goods. Actually, 25% on ly of the notifications mentioning India as the 
origin of the product does not provide the establishment of origin. These notifications concern almost only processed products.  c) The lowest levels of contamination are gene rally found in processed products, which is logic 
considering that a very small quantity of chilli is us ed in the process. In addition raw spices in powder 
can be mixed which can explain certain low levels. The probability of having false positive with the 
analytical method used is very small, 0.25% of the notifications (almost only raw material) show 
results from 1 to 10000 ppb.  d) The conflicting laboratory certificates should be  sent to RASFF in order to be discussed with 
the Member States involved.  
i) The notion of low level cannot be used in  the case of a banned dye which is fraudulently 
introduced in a food product: it should not be present whatever the level.  ii) The opportunity to have a counter analysis w ill be discussed with the Member States.  This 
should therefore apply also to tests performed in the third country establishing the certificates of "non-
presence" of Sudan dyes.  
iii) The analytical test is performed according to similar protocols in all MS (Cf. Detail of analytical test for Sudan dyes) which was s ubmitted to Indian authorities some time ago. 
 
MRL for pesticides in tea by infusion
 
 
Q12. Germany is a major market and destination for Indian tea. Indian tea exports to Germany 
face considerable non tariff barrier in the form of SPS requirements. Germany in particular has 
strict and higher standards for pesticide residue in tea. There is a need for defining the MRLs on tea on infusion basis rather than on dry matter.   Part of residue found in dry matter would be 
absorbed by the tea waste and left over infusion.  In dry matter analysis, the whole incidence of 
residue would be accounted whereas in reality th e same does not get into the tea which is 
consumed.  The pesticide residue analysis carried out by using “dry tea” may not provide the actual 
information regarding the content of the residue.  Detailed technical study data with reference to  the transfer of pesticide residues from made 
tea to tea infusion has been provided to the EC side and Indian side is interested in getting 
information from EC regarding scientific informa tion to demonstrate the equivalence of systems 
employed for testing on dry tea and liquid tea.    
A: The EC has established a sampling method b ased on a risk assessment technique developed 
by Codex Alimentarius.  The rele vant international organisation fo r determining analytical methods 
and setting appropriate levels for pesticide r esidues in tea, as recognised by the SPS Committee 
Members, is Codex Alimentarius.  This body h as established a standardised method (ref. Codex 
STAN 229 and CAC/GL 33-1999), which allows to test th e level of pesticide residues in tea.  In this 
respect the EC is fully in line with Article 5.1 of the SPS Agreement.  
The method foresees to analyse tea leaves (bulk pr oduct) instead of liquid tea, because for the 
latter there is a lack of scientific evidence underpinning the standardised analysis of the product.  The 
objective of minimizing negative trade effects (as s tipulated in Art. 5.4 of the SPS Agreement) is 
taken into account as the EC is fully in line w ith the internationally accepted methodology.  Sound 
risk assessment studies carried out by independent sci entists have demonstrated that the appropriate 
level of consumer  protection is as laid down in EU legislation, moreover also several other WTO 
Members currently review their pesticide legislati on.  Modifying the method of analysis would not 
change this level of protection.   
The EC is also fully in line with the pr ovisions of Annex C of the SPS Agreement as all 
legislative modifications have all been notified through the SPS Channel and apply both within the 
Community as for imports from Third Countries.Th e European Commission recommends India to 
submit a scientific risk assessment on a standardi sed method of analysis in liquid tea to Codex WT/TPR/M/136/Add.2 
Page 9 
 
 
 Alimentarius for its consideration. At the Agri culture and Marine Products  Working Group in Dehli 
on 11 October India agreed to do so.  
Ochratoxin-A (OTA) in Coffee
 
 
Q13. EU wide limits for Ochratoxin-A (OTA) a re proposed only for cereals while in respect of 
coffee and spices, the member states’ legislation would apply.  EU has proposed a maximum OTA 
limit of 3-4 ppb for roasted coffee and 6-10 ppb for soluble coffee.  A harmonized level of OTA for 
the EC would facilitate trade and help to minimise its effect as a barrier to exports/ trade with EC 
Member State. Does EC plan to harmonise OTA levels for all its member States? 
 
A: Indeed, EC has notified on 1 Septembe r a draft Commission Regulation amending 
Commission Regulation (EC) n°466/2001 as regard s ochratoxin A (OTA) under the notification 
referenced G/SPS/N/EEC/247. This  Regulation will  harmonise existing levels of OTA in different 
Member States.  It concerns roast ed coffee beans and ground roasted coffee, soluble coffee, wine and 
other wine and/or grape must based beverages, grape juice and grape juice ingredients in other 
beverages.  OTA has also been observed in dried fruit other than dried vine fruit, cocoa and cocoa 
products, spices and licorice. The appropriaten ess of setting a maximum level for OTA in these 
foodstuffs, including green coffee, as well as a re view of the existing maximum levels will be 
considered after the availability of the European  Food Safety Authority (EFSA) assessment of the 
research results on OTA toxicology.  This review is foreseen to be concluded by 30 June 2006. 
 
Pesticide residues  
 Q14. There are disparities in plant protection chem icals allowed for use in different countries of 
the EC for gherkins and other vegetables and fruits . A Gherkin exporter from India needs to supply 
his customers in different countries with a different pesticide usage from the same crop grown in 
India. This condition is just impossible to observe . Will EC take steps to bring the regulations 
prevailing in all the 25 members EC countries at par to remove such disparity and thus facilitate 
trade? 
 
A: The new Regulation is removing the disparity between EU Member States. 
 
Q15. In UK, the list of chemicals/pesticides a llowed on ‘gherkins’ in the two parts, dried and 
fresh or frozen differs. It is inconceivable that fruit meant for preserving would be spared from the 
pest/disease attack, while selectiv ely attacking fruits meant for consumption in fresh, dried 
uncooked or frozen form. EC may please explain th e rationale for maintaining such differential 
standards.  
A: For fruit sold on the fresh market there are higher requirements for their appearance, while 
some damage on processed fruits can be tolerated. Th is is probably the rationale for the difference in 
the UK.  Q16.  The European Communities has strict health & hygiene rules for import of spices such as Black Pepper and Red Chilies. Moreover, ETO treatm ent which is allowed in countries such as 
USA & Australia is not permitted for imports into EC countries. Will EC take steps to modify their 
health & hygiene rules so that ETO treatmen t is permissible as in USA & Australia?  
 A: The EC is not planning to modify its approach towards the use of ETO. 
 
 WT/TPR/M/136/Add.2 
Page 10  
 
Unreasonable approach of Irish residu e testing Government laboratory:
 
 Q17. Irish Government Laboratory has reported that Indian table grapes shipped by Indian 
Company Sam Agri Tech, possess pesticide residue called Omethoate even though the same has 
been certified by Eurepgap, a quality certification Or ganisation. Further, these are also checked by 
laboratories of the Netherlands and UK who have confirmed that these varieties of grapes are 
pesticides free. This is causing severe loss to the In dian exporters. By when is EU likely to have a 
harmonized system for laboratory testing of pestic ide residue levels in different Member countries 
of EU? 
 A: EU Member States test fo r pesticide residues on random samp les or targeted samples at 
border and in the supermarket irrespective of certific ation or other findings on similar lots elsewhere. 
A positive finding, when confirmed shows that th e consignment was not complying despite the 
certification. 
The following methods are most commonly used, up to the MS discretion: 
 - Gas Chromatography method [1]: ethyl acetate extraction in the presence of sodium 
sulfate, filtration, addition of more sodium sulfat e, evaporation, re-dissolution in cyclohexane and 
determined by GC-MS/MS.  - Liquid Chromatography method [2]: ethyl acetate extraction in the presence of sodium sulfate and addition of sodium hydroxide,  filtration, addition of more sodium sulfate, 
evaporation, re-dissolution in meth anol, and determined by LC-MS/MS. 
 
Rejection of consignments
 
 Q18. When a consignment is reported to be rejected by a member state, neither the reports nor the method of testing is intimated to the export ers, even on demand. Hence, the credibility of the 
method and test results are doubted and it also se ems to be contrary to the principles of natural 
justice.  There is no appeal provision in the EC norms and cargo is not permitted to return on 
rejection. Exporting country have a right to know the reason for rejection of consignment and also 
return of rejected goods.  Does EC propose to revise its  regulations to take care of these concerns? 
 
A: The above-mentioned new Decision provides for re-dispatching of consignments in case that 
they are not in conformity with EU legislation. 
 
Lack of harmonisation and common standards
 
 Q19.  EC border posts have been testing importe d food item under the food safety standard for 
parameters that have not been specified in the EC regulations. For instance, the EC regulation do 
not seem to specifically ban the use of “bacterial inhibitor” and hence this cannot be cited as a 
reason for rejecting the consignment and putting the unit on rapid alert. However, this has 
happened in Spain. Could EC explain the rationale for such action?  
 
A: It is clear that with “bacterial inhibitor” is meant "antibiotics or antibiotic substances".  It is 
very likely that in this particular case the consi gnment has been rejected due to excessive levels of 
residues of antibiotics.  
Differential levels of pesticide residue
 
 
Q20. A problem being faced by Indian exporters of grapes, gherkins etc., is the differential 
pesticide residue levels followed by different member st ates of the EC, in spite of the fact that there 
are EC wide harmonized levels prescribed by the EC as  well as Codex.   Besides, frequent reduction 
in maximum residue levels of pesticides and without adequate notice creates problems for WT/TPR/M/136/Add.2 
Page 11 
 
 
 exporters. Would the EC indicate a time frame by which they would have harmonized residue 
norms? 
 
A: The EC is preparing a proposal for a Regula tion of the European Parliament and of the 
Council on maximum residue levels of pesticides in products of plant and animal origin.  The Council 
has adopted a 'Common position' on 19 June 2004, which has been fo rwarded to the Parliament for a 
second reading. It is impossible to inform about a co rrect calendar for further steps.  The Regulation is 
likely to be adopted in early 2005.  The app lication however will depend upon the transition of 
temporary maximum residue limits into Community legi slation. In this respect the application will be 
most likely by summer 2007.  
 
Problems relating to health certificate  
 Q21. For export of certain products like crus hed bones, ossein and gelatin to EC meant for 
human consumption, the European Communiti es has specified certain conditions to avoid 
contamination, and regular inspection by the co mpetent authority of the same. Since name of 
vessel is required to be indicated in the Health Certificate, if due to overbooking and other reasons, 
some shipping companies shut out the cargoes an d export consignment are eventually shipped by 
other vessels, then the exporters have to obtain fresh  Health Certificates.  This results in delays in 
exports and loss of market access. Will EC consider modifying  this requirement to make it more 
trade facilitative? 
 
A: When the health certificate is not correctly filled in indicating all  information, it will be impossible for the inspection services to  carry out pr oper inspection.  In this respect the EC cannot 
commit itself to allow incorrectly filled health certificates.  Q22. The Indian exporters are facing difficulty in the export of Ossein and Gelatin and other livestock and poultry products due to the categorization of India in GBR II in spite of the fact that 
India is free from TSE group of disease and have provided all the technical data on the import of 
MBM and cattle during the last 20 years from the Eu ropean countries to EC. However, EC has not 
upgraded India’s GBR status. Would EC clarify the reasons for the same? 
 A: Based on the geographical BSE risk assessment of India, carried out by a group of 
independent scientists in the Scientific Steeri ng Committee, India has b een classified in GBR II 
mainly because of the instable in ternal situation in India.  As India only carries out passive 
surveillance, it will be impossible to trace back any potential case , especially in view of the potential 
recycling of the BSE agent, due to MBM imports in the critical period. 
 
Varying procedures for rapid alert notices
 
 Q23. Under the current system, out of the 25 countries of the EU, if an alert is issued by one member state and the concerned exporter is exportin g to mainly 3 EU countries, even after these 3 
countries have lifted the alert after clearing of the stipulated number of consignments, in practice, 
the alert will still be in force in the remaining 22 countries.  This would affect the credibility of the 
exporter as these alerts may remain perpetually in force in the 22 countries.  This is irrational and 
should be modified.  Normally the alert should be lifted by the other countries once the same has 
been lifted by the country where it originated.  Varying MRLs prevailing in the Member States for 
agricultural products also result in issuing of more rapid alerts against Indian products. 
Does EU propose to modify its curr ent systems to meet this concern? 
 WT/TPR/M/136/Add.2 
Page 12  
 
A: Yes, as already stated the implementation of the TRACES system will overcome this difficulty.  
Equivalence arrangements for Indian accreditat ion agencies for export of organic products
 
 
Q24. In accordance with Regulation 2092/91 of the EC, India has requested the EC on 5.7.2001 
to approve 4 accreditation agencies (APEDA, Tea Boar d, Spices Board and Co ffee Board) of India 
for export of organic products to EU.  The no tified Indian accreditation agencies will have the 
powers to accredit certification and inspection agencies to certify the quality and conformity of the 
products meeting EC requirements.    India ha s carried out the necessary amendments in its 
regulations which, in most cases, are on the lines of amendments carried out by the EC in its own 
regulations. Would EC take early action to gran t accreditation to the 4 Indian agencies as a 
measure for smoother trade flow between India and EC? 
 
A: Work on recognition of Indian organic sta ndards and controls is well advanced. An EC 
inspection team has just returned [27.10.04] from I ndia examining the practical application of organic 
rules and advance the discussions with the aut horities in New Delhi, including APEDA, the Spices 
Board, the Tea Board, the Coffee Board, and the Coconut Board. Subject to any recommendations the 
inspection team makes and the response of India, we foresee taking a decision on recognition of Indian organic rules in the next few months.  Genetically modified Foods
 
 Q25. During November, 2002 the EC Farm Mini sters reached an agreement on the safety and 
labelling on food and feed derived from GMO.  Under the agreement, the presence of 0.9% GM 
material in food and feed requires specific labelling.   A tolerance threshold of 0.5% was set for the 
accidental presence of GM material in food and f eed. It is not clear what happens if the presence is 
between 0.5% to 0.9%. We request EC to clarify the same. 
 
A: There is a major confusion here, it concerns two different tresholds.  The treshold of 0.9% 
refers to traceability and labeling.  When the presen ce of GM material in conventional food is not 
higher than 0.9%, then this food does not need to be labelled as containing GM material.  This 
automatically refers to authorised GM material. 
Under current legislation, there is no tolerance tr eshold for the adventitious presence of GM material 
in food or feed which has not yet been authorised  but which has received a favourable EU scientific 
risk assessment.  The EC has endorsed a 0.5% treshol d for the adventitious or technically unavoidable 
presence of such GM material. Above this treshold the product will not be allowed on the market as it 
is illegal use. 
 
Issues related to Pharmaceuticals
 
REACH  
 Q26. The EC proposal for a Regulation for regis tration and evaluation of notified chemicals 
manufactured or imported into EC will make it man datory for about 30,000 chemicals imported in 
quantities above one ton a year to be subject to re gistration, testing and certification in EC and 
regulate authorisation for import/sale of these su bstances in the EC. This is likely to result in 
additional cost for the exporters.   Under the proposed regulation,  the responsibility of ensuring that the chemicals imported 
into EC conform to the REACH regulation devolves on the EC based importer.  
EC may indicate the present status of the pr oposals and how they are going to simplify the 
procedures for exporters and in what manner they wo uld protect the interests of SMEs?   What are 
the further ways of lightening the registration and safety obligations for businesses being WT/TPR/M/136/Add.2 
Page 13 
 
 
 considered by the EU? Will EU consider a single re gistration obligation per chemical or substance 
so as to allow businesses to get together in co nsortia to register just once where all produce the 
same chemical or substance. 
 
A: It is important to note that although  REACH requires around 30 000 substances to be 
registered – over a period of 11 years, onl y a small proportion of these (about 2000 to 2500 
substances) must be authorized for use. These are the substances of highest concern. Moreover, the 
registration requires information of the properties of substances to be sent in, but there is no automatic 
requirement for the testing of all chemicals, rath er the opposite, as REACH requires all available data 
to be used before any testing should be carried out. 
Non-EU based manufacturers can choose either to leave the re sponsibility for the registration 
with their importers, or they can  use the facility set out in article 6a to establish an “only 
representative” in the EU to register on their behalf.  
In order to assist registrants, the European  Commission has started a major programme of 
work to develop guidance, in co-operation with stak eholders, to ensure consistent, cost-effective and 
smooth operation of the system, explaining the many  flexible elements in REACH available to 
companies. The Commission intends that appropriate guidance will be available at the time each part 
of the REACH system comes into force. 
In addition, the European Communities recogni ses its obligations under Article 12.3 of the 
TBT Agreement to take account of the special devel opment, financial and trade needs of developing 
country Members, with a view to ensuring that REACH does not create unnecessary obstacles to 
exports from developing country Members. In a ddition to the provision of extensive guidance 
material, we aim to do our best to help devel oping countries to familiarise themselves with REACH 
and comply with it. This will be achieved in part  through technical assistance and capacity building 
but also through training and provision of information by the proposed Chemicals Agency. The REACH proposal encourages consortia to be form ed in order to allow different companies to 
share data and costs. When it concerns data orig inating from tests on vertebrate animals, the data-
sharing is mandatory.   During the ongoing discussion in the Council of Ministers and in the European Parliament of 
the Commission proposala system of “one regist ration one substance” – involving mandatory sharing 
of non-animal test data and other core data – h as been proposed by some EU Member States and is 
currently under discussion under the EC decision-making procedures. It is still possible to take into 
account proposals for changes to REACH which would reduce costs and bureaucracy as long as the 
timetable, objectives and scope of REACH are reta ined. In relation to the “one substance one 
registration” proposal, the Commission has conc erns about the workability of such a scheme, 
particularly in relation to the compulsory requireme nt foreseen for industry consortia to agree core 
technical data.   Marketing approval for Pharmaceuticals/drugs
 
 Q27. There are price, volume an d access controls placed on marketing of medicines by the 
national governments in EU as there is no comp lete harmonisation of the policy for approvals. 
Marketing approvals in EU are granted at the EU  level by the European Agency for Evaluation of 
Medicinal Products based in the UK as also by  the respective member states. The process involves a 
lot of investigations into the composition, quality, manufacturing process, pre-clinical 
documentation, clinical data and pharmacologi cal data at several stages. There are testing 
obligations which are costly and time-consuming.   EC is requested to provide details about the procedures for marketing approvals at the EC 
level and at the level of member states. Information is also requested about the patents for 
pharmaceuticals/drugs that are expiring in EU. Wi ll  EU explain whether it is willing to accept the 
field trials or clinical trials in India as the data for approval of drugs ?        WT/TPR/M/136/Add.2 
Page 14  
 
A: The fundamental principle of the EC pharmace utical legislation is that no medicinal product 
may be placed on the market of a Member State unl ess a marketing authorization has been issued by 
the competent authorities of that Member State in accordance with the provisions of Directive 
2001/83/EC (medicinal products for human use) or  of Directive 2001/82/EC (veterinary medicinal 
products) or an authorization has been granted by the European Commis sion in accordance with 
Regulation (EEC) No 2309/93 (replaced by Regulatio n (EC) No 726/2004 as of 20 November 2005). 
 Whether the marketing authorisation is granted by the Member States or by the European Commission, the above mentioned legislation lays down detailed criteria for the scientific assessment 
of medicinal products, based on the quality, safety, and efficacy of the product concerned. In turn, in 
order to prove the safety and efficacy of the medici nal product, the applicant can choose a number of 
routes: it can provide the results of all necessary pre-c linical tests and clinical trials; it can refer to the 
pre-clinical and clinical information of an existi ng already authorised product (the so-called informed 
consent and generic applications), or it can rely  on the well-established medicinal use of the active 
substance contained in the medicinal product.  All relevant legislation governing the approva l of medicines is publicly available in the 
following website:  http://pharmacos.eudra.org/F2/home.html. 
Besides, it should be pointed out that all d ecisions taken in this area by the European 
Commission and the Member States conform to the principles of the WTO agreement since they do 
not differentiate between EC and non-European manufacturers/im porters, nor do the procedures 
constitute access barriers. 
As regards pricing and reimbursement decisions, these fall under the exclusive competence of 
the Member State, and in any event they do not  interfere with the safety, efficacy and quality 
assessment necessary for granting a marketing authorization. 
With regard to the expiry of patents, the Commission does not monitor the expiry of patents.  
As to the acceptability of clinical trials performed  in India, the only requirement contained in the 
Community legislation is the inclusion in the appli cation for marketing authorization of a statement to 
the effect that clinical trials carried out outside the European Union meet the ethical requirements of 
Directive 2001/20/EC of the European Parliament  and of the Council of 4 April 2001 on the 
approximation of the laws, regulations and administ rative provisions of the Member States relating to 
the implementation of good clinical practice in the conduct of clinical trials  on medicinal products for 
human use.  Q28. The manufacturing sites of Indian phar ma industry are inspected and approved by EC 
Regulatory Agencies before granting them market  authorization (MA) for any product. However, 
even after such registration, the industry still need  to have each batch of every product sent to a 
batch release site (approved laboratory) in EC be fore the batch is allowed to be marketed. This 
results in delay in product launching, additional co sts incurred due to additional testing, transport 
of goods first to batch release site and then to  distribution to warehouses in various EC member 
states. For corresponding exports to India from  EC member states, once the manufacturing site 
and the product is registered, India does not insist on testing of each batch of a drug before its 
release in the Indian market. EC is requested to ex plain the rationale for its current regulation.  Is 
there any proposal to review these requirements?  
A: According to Article 51(1)(b) of Directiv e 2001/83/EC and Article 55(1)(b) of Directive 
2001/82/EC, in the case of medicinal products coming from third countries, each production batch must undergo in the importing Member State a full qualitative analysis, a quantitative analysis of at 
least all the active constituents and all the other tests or checks necessary to  ensure the quality of 
medicinal products in accordance with the requirements of the marketing authorization.  
The rationale for this provision is to ensure that each batch released in market of the 
Community fulfils the requirements of the releva nt legislation concerning the quality of medicinal 
products. The provision has been amended recently  (by Directive 2004/27/EC amending Directive WT/TPR/M/136/Add.2 
Page 15 
 
 
 2001/83/EC and by Directive 2004/28/EC amending Di rective 2001/82/EC) to specify that it applies 
even in the case of imported products whic h were manufactured in the Community.  
 There is no intention to review this pr ovision, which in any event places the same 
requirements of quality on products manufactured inside or outside the Community and between 
Community and imported products. 
 
NTBs faced in medicinal plant exports  
 Q29. Even though several medicinal plants a re widely used since ages in India for human 
ailments, many of these plants are not in the approved list of EC countries. The procedure for 
inclusion of such Indian plants in their approved  list is very time consuming and a costly affair. 
Will the EC initiate steps to reduce cost and time factor so that medicinal plant exporters from 
India do not face this NTB in export of medicinal plants? EC Regulation on Ayurveda traditional system of medicines 
 A: As stated above, all medicinal products to be placed on the Community market have to be 
granted a marketing authorization by either the Member States or the European Commission. The 
time and cost involved are the same for all me dicinal products wishing to be placed on the 
Community market. 
The situation of herbal medici nal products, and the need to im prove their routes for marketing 
in the EU, has been addressed in recent legislati on, namely Directive 2004/24/EC of the European 
Parliament and the Council of 31 March 2004. The dir ective aims at addressing the fact that many 
herbal medicinal products have been in use for lo ng period of time. Still, there are often no or no 
sufficient tests and trials for the product so that th e requirements for a “normal” authorisation are not 
fulfilled. 
The new Directive adds a third possibility for obtaining the permission to market a herbal 
medicinal product. The three possibilities available would therefore be: 
• marketing authorisation on the basis of a dossier containing a full set of pre-clinical tests and 
clinical trials on the product’s safety and efficacy; 
• marketing authorisation on the basis of the well established medicinal use of the substance 
concerned demonstrated by reference to publishe d scientific literature on the product’s safety and 
efficacy;  
• a new simplified registration procedure introdu ces by Directive 2004/24/EC on the basis of 
information on the traditional use of the substance. 
• The simplified registration procedure of the new Directive will be applicable where the 
medicinal product concerned fulfils certain criteria:  
• it must be a medicinal product that contains only active substances of herbal origin;  
• it must be in medical use for 30 years (at least 15 years in the Community);  
• Information on the traditional use of the product must be sufficient to conclude on the 
product’s safety and efficacy;   
• only those therapeutic indications which do not require the prescription by a doctor are 
allowed.  Directive 2004/24/EC has to be transposed by the Member States by 30 October 2005.  Q30. EC has proposed a regulation that requires the imported ayurvedic products to prove bibliographic or expert evidence to the effect that  the product in question has been in medicinal use 
throughout a period of at least 30 years including at least 15 years within the EC. If the product 
has been in use in EC for at least 15 years, fast  track marketing approvals are allowed. EC has so 
far not allowed marketing of ayurveda products and medicines. Hence, the requirement of at least 
15 years use in an EC country imposed by EC Regula tion is contradictory in nature and cannot be WT/TPR/M/136/Add.2 
Page 16  
 
fulfilled. This regulation is thus a market access ba rrier.  India requests for the rationale for this 
regulation.  Seizure of Indian Pharma Products by EU as ‘Counterfeit’  
 
A: The legislation mentioned is Directive 2004/24 /EC (see reply to the previous question), which 
creates a simplified registration procedure for trad itional herbal products. We  understand that certain 
ayurvedic products (namely those of herbal orig in) could benefit from the provisions of the new 
Directive.  To be eligible for the proposed simplified re gistration of Directive 2004/24/EC, the medicinal 
product has been in medicinal use in the Community for at least 30 years. To open the new procedure 
for products with medicinal use (also) outside the Community, the Direc tive provides that it is 
sufficient that at least 15 years of use fall within  the Community, if the rest of the 30 years has 
occurred outside the Community.  Hence, the proposal requires a certain use with in the Community and does not go as far as to 
consider any use even if occurred only outside the Community. The key reason is that the effects of a 
medicinal product as well as its side-effects can vary  according to the circumstances of its use (like 
physical particulars of the human beings, availa bility and prevalence of therapeutic treatments or 
medicinal products etc.). Bearing in mind that the applicant generally does not have to run any pre-clinical or clinical trials on the product, it therefor e is inevitable to demand at least a certain period of 
use within the Community where the product shall be authorised. 
 However, the Directive goes one step further towards facilitating the use of herbal medicinal 
products with a tradition outside the Community. To maintain a high level of health protection, it 
upholds the minimum requirement of 30 years of traditional use. But where this period cannot be demonstrated within the Community, the product ca n be referred to the new Committee for Herbal 
Medicinal Products established within the European Me dicines Agency. On the basis of an analysis of 
the product, the Committee will establish a Community herbal monograph, on whose basis the 
Member States shall grant or refuse the registration. 
 In any event, it should be noted that, in t hose cases where ayurvedic medicinal products do 
not fulfil the requirements for simplified registrati on of Directive 2004/24/EC, they can still apply for 
a marketing authorization through one of the routed for authorization described  in the answer to the 
previous question (application on the basis of a dossi er containing a full set of pre-clinical tests and 
clinical trials on the product’s safety and efficacy or application on the basis of the well established 
medicinal use of the substance concerned demonstrat ed by reference to published scientific literature 
on the product’s safety and efficacy).   
Q31. The French Customs have seized an in tran sit merchandise of ‘Venegra’  exported by an 
Indian firm. The seizure was apparently made on a complaint filed by M/s Pfizer Ltd, 
manufacturers of ‘Viagra’, who claim that the consignment was counterfeit produced by an Indian 
pharmaceutical company and did not have the properties of Viagra.  The action of the French authorities raises issues about interpretation of patent protection laws in Europe and India.  The pharmaceutical product was manufactured by Indian manufacturer with necessary licence from the Drug  Control Authorities of India and exported to 
Guinea. It will apparently have the legal protectio n in India where process patents are allowed.  
Product patents will have protection in India only with effect from 1.1.2005. 
 Since the consignment was in transit and wa s not meant for EC market, it does not stand to 
reason that the consignment violated any of the IPR provisions of EC patents law, which permits 
only product patents.  Would EC clarify its understanding on this issue? 
 A: First of all, the Community customs code  and its Implementing provisions enables EU 
customs authorities to undertake any necessary control from the moment a good is placed under 
customs supervision within the European custom s territory. This includes cases in which a good is WT/TPR/M/136/Add.2 
Page 17 
 
 
 placed under a transit procedure within the European  customs territory, as transit is a suspensive 
customs procedure where goods are under customs supervision.  Moreover, in the framework of customs acti on against goods suspected of infringing certain 
intellectual property rights, the customs authorities concerned have an obligation to detain the goods 
for which an application has been lodged. If the right holder does not initiate proceedings within 10 
working days, release of goods is granted subject to completion of customs formalities. 
 
Customs Procedures
 
 Q32. It is served (refer paragraph 11 of the Summary Secretariat Report) that although customs 
procedures are harmonized among the EC Member States, however, their uniform implementation 
is still awaited. We request the EC to provide an  indicative timeframe fo r uniform implementation 
of the customs procedures among EC’s Member States? 
 
A: The Community Customs Code lays down common rules for customs procedures, and the 
Commission's objective has always been to ensure uniform application of all customs rules and to 
ensure a level playing field in the treatment of  economic operators. The Community has in place all 
the necessary legal, institutional and administrative measures to ensure harmonised practice. Those 
measures ensure effective coordination between EU Member States in order to have uniform 
implementation. The EC customs Union is indeed  supported and equipped to function as a single 
entity. There is adequate legislation (e.g. the EC Customs Code and its Implementing Provisions), 
there is regulatory and supervisory structure a nd they are various operational tools and common 
procedures  
Tariff related issues – Basmati Rice.
 
 
Q33. After the issuance of EC Regulation No. 2294/2003 of 23 December 2003, it was ruled that 
w.e.f 01 January 2004 only 6 Indian and 1 Pakistani Traditional Basmati variety would be entitled to 250 ECUs derogation of duty. Accordingly, Cer tificate of Authenticity (COA) when issued by 
EIA, the Competent Authority containing the mix of these 6 Indian Traditional basmati varieties 
were accepted in EU  and given the necessary rebate of 250 ECUs. Suddenly EC issued another instruction that any COA issued by EIA afte r 15 April 2004 for export of Traditional Brown 
Basmati Rice should only mention ONE variety in Box 6. 
The Basmati trade of India treats this action as a clear case of Non -Tariff Barrier or a 
Technical Barrier since it does not matter whether the rice is Basmati 370 or Taraori or Type 3 or 
Basmati 386 or Ranbir Basmati  or Basmati 217 as  all of them are entitle d to 250 ECUs derogation 
of duty following inevitably that the blend of a ll these very 6 varieties too are eligible for 250 ECU 
derogation of duty. Will EC clarify the reasons for imposing this new condition? Is it likely to 
review this condition?  
 
A: In early 2004 a list of approved Basmati va rieties eligible for import duty reduction was 
published in Commission Regulation (EC) No 2294/2003 . Authenticity certificates must declare one 
approved Basmati variety per shipment. The la test Commission Regulation on Basmati (No) 
1549/2004 follows this principle as well. It has comm ercial and control reasons. Worldwide trading in 
rice is based on exact varieties. Moreover different Basmati varieties have different merits, prices and 
customers. Moreover the biological control of Basmati shipments is facilitated only if one 
consignment consists of one single variety. In an Agreement in the form of an exchange of letters 
between the EC and India on GATT Article XXVIII (28/8/2004, OJ L 279, p. 19) India has agreed 
that ‘Indian authorities shall continue to issue th e authenticity certificates… meaning that the current 
system of administration of the certificates of authentic ity shall be maintained’. Basmati rice is in high 
demand in the EU. It is in the very best interest of producers, suppliers and importers to protect the WT/TPR/M/136/Add.2 
Page 18  
 
image of Basmati and to guarantee the authenticity  of each Basmati shipment, including the exact 
identification of the Basmati variety supplied in a given shipment of rice.  
 
Q34. The Report by the Secretariat in par agraphs 9 and 10 of the Summary, read with 
paragraphs 15 to 19 of Section III, draws attentio n to the complexities in the EC’s tariff structure 
on agricultural products, with possibilities of varying  the duty applicable due to seasonal, technical 
content, or “entry price” (variable) considerations.   We note that variable levies are not consistent 
with the EC’s obligations arising from the WTO Ag reements.  We further request the EC to lower 
its tariffs on agricultural products, simplify its tariff regime and to impart due transparency.  Not 
only do agricultural products attract the highest ta riff rates, with over 200% for some products and 
a vast array of products of export interest to developing countries attracting duties of 100% or more 
(refer paragraph 20 of Section III of Secretariat Report), our attention has been drawn to the fact that the EC has not revised downwards its tariff st ructures since the last TPR.  We believe that 
continuous and progressive reform provides a useful policy tool to enhance domestic 
competitiveness, and urge the EC to address the leg itimate concerns of its trading partners in the 
agriculture sector.    
A: The prices for agricultural goods are submitte d to greater variations than the prices for 
industrial goods. Consequently, it is difficult to ev aluate several months in advance the amount of 
duties which will have to be paid for a certain quan tity of agricultural goods to import. With specific 
duties, this evaluation is easy to do in a reliabl e way, due to the fact that specific duties are 
transparent, predictable and simple: So many stuff so much duty. In this respect, specific duties make 
trade easier for operators. This justify that a high pe rcentage of EC agricultural tariffs are expressed in 
non ad- valorem tariffs. 
Moreover, we consider that specific duties  are  more transparent than ad valorem duties due 
to the fact that the ad valorem duties have to be calculated as a percentage of the custom value which 
is often declared in not a reliable way by the ope rators (import values which are declared are often 
under-invoiced or over-invoiced for different reas ons such as payment of VAT, frauds, exodus of 
capital)  
Q35. The Secretariat Report has identified (by reference to paragraph 14 of the Summary and 
paragraph 23 of Section IV) that higher tariff protection for agricultural products and domestic 
support coupled with limited liberalization of trade in agricultural products under the EC’s 
preferential trade agreements, have insulated EC’s production from competition and generated 
surpluses.  The policy thus has made subsidies indi spensable for exports of these surpluses, as well 
as of downstream agricultural products. The S ecretariat Report has also observed that EC’s export 
subsidies have remained relatively high.  It is fe lt that such measures adversely affect exports of 
other countries particularly developing countries.  We request the EC to provide a timeframe for 
discontinuing these measures whic h limit foreign competition.  
 
A: The EC is fully committed to further negotiati ng on the basis of the Ag reed framework, with a 
view to reaching agreement on modalities in Hong K ong at the end of the year 2005. Regarding the 
question raised here, it is an issue for further nego tiations as indicated in paragraph 18 of annex A of 
the Agreed Framework. 
 
Q36. Paragraphs 26 through 31 of Section II of the Secretariat Report draw attention to the 
complex web of preferential trade agreements of th e EC, and to the limited liberalisation of trade in 
agricultural goods thereunder. In fact, the Report is  categorical that the limited liberalisation of 
agriculture under the agreements has hindered its exposure to competition and more significantly, 
that liberalisation on a multilateral MFN basis would eliminate the existing adverse trade diversion effects of EC’s PTAs.  We urge the EC to adopt an approach consistent with this recommendation. 
 WT/TPR/M/136/Add.2 
Page 19 
 
 
 A: One of the EC’s main trade policy objectives is to promote sustainable development more 
broadly by ensuring that all countries are capable  of harnessing globalization and of benefiting from 
the expansion of trade. Therefore, the increased participation of developing and least developed 
countries in the international trading system is a strong priority for the EC. Preferential arrangements are, as a complement to the WTO, important instruments to that end.  
 Just as the ongoing Doha Development Agenda plays a vital role for the modernization and 
imrpovement of global trading regime, WTO memb ers preferential arrangements could be improved 
further. The Secretariat’s Report refer to that eval uations of preferential trad e agreements in general 
(including also agreements concluded by the EC) provide ambiguous result, but that most studies find a positive, albeit small, welfare impact on countri es participating in preferential trade agreements. 
This is also why the EC is continuously assessi ng the effectiveness of its preferential trading 
agreements. The conclusion of the Cotonou Agreemen t was e.g. based on studies analyzing the effects 
of the Lomé Convention. Similarly, the propo sal for a revised GSP was based on underlying 
examinations of the impact of the current GSP. The EC has also evaluated the effectiveness of its 
trade measures towards other group of countries or regions. 
 While preferences certainly is no panacea, it shoul d be stressed that the EU today is by far the 
largest market for products originating in developi ng countries, including agricultural products. The 
EC would like to recall the fact that the frame work agreement on agriculture dated 1. August 2004 
fully recognized the importance of long-standing preferences for developing countries.   
Market Access Issues
 
Preferential Quota for Sugar  
 Q37. The level of import of quota sugar in the EC under the Tariff Rate Quota (TRQ) regime has remained constant even though sugar consum ption in EC countries has gone up over the years 
and new members have joined the EC. The existin g TRQ regime for sugar does not also take into 
account the shortfalls in utilization of quotas by the quota-holding countries which can be 
allocated to other countries.  In view of this Indi a feels that EC needs to review its TRQ regime on 
sugar and give higher quota allocation to countries  like India, which is the largest producer of 
sugar in the world.  
We request EC’s comment on this issue. 
 A: Over the last years, sugar consumption in the Community has remain ed largely stable as a 
consequence of a slight decline in the per capita  consumption being offset by modest population 
growth.   The quota allocated to new EU Member States is  line with their consumption and lower that 
current production levels. Consequently, the su gar absorption capacity of the EU after the 
enlargement has remained practically unchanged.  
The ACP Protocol and the Agreement with India already include provisions for reallocation of possible shortfalls in delivery obligations.   
Approval of milk products producing/exporting units:  
 
 
Q38. Currently 39 Indian milk processing units are awaiting approval of EC.  In the absence of 
approval of the EC, the export of milk/milk based  products cannot be made to EC.  The Residue 
Monitoring Plan (RMP) has also been submitted to  the EC.   The delay in such approvals impedes 
market access for milk and milk  based products. Does EC proposed to streamline its procedure for 
approvals so that these are granted in a time bound manner?  
 
A: Commission refers to the negative outcome of  the FVO inspection mission end of 2003 on the 
control of residues in live animals and animal products .  Apart from the fact that a  residue monitoring WT/TPR/M/136/Add.2 
Page 20  
 
plan for dairy products has been submitted fo r 2004, which shows several gaps,  a Food and 
Veterinary Office mission should be scheduled.  In  view of the outcome of the 2003 inspection 
mission, such inspection visit has been postponed , but such inspection is now scheduled for the 
second half of 2005, pending the satisfactory response to the pre-mission questionnaire. 
During the Agriculture and Marine Products  Working Group (AGMPWG) meeting on 
11 October 2004, India indicated it is currently collecting all necessary information and will come 
back to EC in due time.  
Approval of egg products producing/exporting units
 
 
Q39. 3 egg products producing/exporting units is awaiting approval for more than five years.  
The EC has not approved the units apparently on the ground that it needs to harmonize its standards and procedures for member states befo re granting the approvals.  By when does EC 
propose to complete harmonization exercise? Woul d the accession of new members to EC further 
delay this process? Are any time limits be ing fixed for completing harmonization? 
 
A: The information in this question is not correct .  India can export eggs and egg products to EU, 
but they have to agree upon it with individual Member States as trade is not harmonised.  At the AGMPWG India complained about the situation of havi ng to deal with individual MS to export their 
egg products, mainly because of the practical pr oblem that they ship egg products to Rotterdam, 
which need then to be transported to Greece. This transport takes too long in relation to the shelf-life 
of the products. Therefore they want a harmonised system of listing of egg products establishments.  
It should be mentioned that several gaps have b een detected in the 2004 residue monitoring plan and 
the results for 2003.  Commission explained that moving towards harmonisation should carefully watch that it doesn’t have any adverse trade effects.  Anyway th e Commission is prepared to consider the proposal, 
but it is not foreseen on the short term. Commission al so highlighted that a proper residue monitoring 
plan be implemented.  
Approval of India for export of poultry meat
 
 Q40.  A proposal to approve India as a third country eligible for export of poultry meat to EC is 
pending for more than four years on account of  completion of formalities like exchange of 
documents and inspection results. Does EC propo se to standardize a timeframe for approval 
procedures and also indicate a timeframe  by which approval would be granted?  
 
A: At present the Commission is awaiting the additi onal information that India is preparing for 
submission, as mentioned at the AGMPWG.  Standa rdising a timeframe for approval procedures is 
not an issue as all depends on the completeness an d accuracy of the information provided by the 
potential importer. As soon as the Commission receives the appropriate information, it can envisage a 
FVO inspection mission.  For this purpose it is r ecommended to India to already submit a request for 
such inspection to the Food and Veterinary Office, as  such a visit is not foreseen in the FVO program 
for 2005. 
 
Outward processing
 
 Q41. In case of textiles, Outward Processing Trade (OPT) of EC with East European countries is done without any quantitative restriction and duty. For example, fabrics sent from EC to East 
European countries for converting into garments, assumes special status. Garments made out of 
fabrics originating in EC return back to the Co mmunity without any quantitative restrictions or 
any duties. As against this, garments made of Indian  fabrics attract a duty of 12.2% on the garment WT/TPR/M/136/Add.2 
Page 21 
 
 
 value. This puts the Indian fabrics at a disadvant age to the extent of 25-35% vis-a-vis fabric of 
European community origin. Will EC explain the rationale for such differential treatment? 
 
A: The fabric of EC origin sent for processing keep s its origin status and reenters the Community 
as such 
 
Problems in realizing payments against L/Cs  
 Q42. Indian exporters of leather & leather products of late are facing difficulties in realizing payments from overseas buyers particularly from Italian buyers even if the export shipments are 
effected under irrevocable and confirmed Letter of  Credit opened by Banks in Italy. The buyers 
generally obtain Court decree from the local Courts  in Italy directing L/C opening banks to stop 
payments. 
Stoppage of payment of L/Cs does not appear to be a fair trade practice as banks are bound 
to honor the L/Cs, if the documents submitted under the L/Cs are in total conformity. The practice 
of resorting to Court decree to stop payment under  the L/Cs appears to be against the letter and 
spirit of Uniform Customs and Practices in Documentary (UCCP).  
EC is requested to inform in what manner this problem can be overcome. 
 
A: The EC notes the explanation given. As the EC  does not know the details of this matter, the 
EC cannot recommend to India how to overcome the issue. 
 
Trade Defence Measures
 
Anti-dumping  
Repeated recourse to AD/AS actions against India  
 
Q43. Over the years, European Communities has been taking frequent recourse to anti-
dumping/subsidy investigations especially on India’ s textile products. The use of such measures by 
the EC far outweighs the trade proportion. While In dia’s total market share in EC’s global imports 
is 1.36%, the trade defence measures of EC target almost 3.5% of India’s total exports to EC. While 
Art. 15 of the Agreement on anti-dumping provid es for special & differential treatment to the 
developing countries in the use of such measur es by the developed countries and suggests that 
constructive remedies must alwa ys be explored by the developed countries to address the relevant 
concerns, the EC has failed even to reflect this prov ision in the domestic laws of the member states 
of the EC. In the textile sector, certain product  categories, namely Unbleached Cotton Fabrics 
(UCF), Cotton Type Bed-linen, and Polyester Staple Fibre (PSF) originating inter-alia, from India 
have been subjected to repeated anti-dumping/su bsidy actions. This is perceived as a systematic 
campaign targeting at India’s textile exports in which India enjoys a measure of comparative 
advantage.  This has had a debilitating effect on  In dia’s textile industry. We would request EU to 
be sensitive to India’s concerns on this issue. In  this context we would also like to know what 
constructive remedies its explores before imposin g anti-dumping measures against developing 
countries.  
 A: Generally speaking the EU is a moderate u ser of the antidumping - antisubsidy instrument. 
Over the last 5 years also the number of new inv estigations has gone back significantly from 88 new 
investigations to 28 in 2004. This trend is underlined  by the fact that less than 0,1% of the value of 
total EU imports are concerned by trade defense measures. The comparatively higher number of cases against Indian exporters reflects the number of comp laints made by EU industries and the affirmative 
findings of dumping and subsidies in the investiga tions. However, out of 47 cases 6 have expired and 
15 have been terminated out of which 8 without me asures. Out of presently 26 measures in place only WT/TPR/M/136/Add.2 
Page 22  
 
6 concern textile products. Therefore one cannot speak  about a systematic campaign targeting India's 
textile exports.   The EU standards for investigations in rega rd to injury and dumping are very high and 
developing country specificities are duly taken into consideration in the evaluation of questionnaires 
and at verification visits. Furthermore the criterion of  Community interest has to be fulfilled in order 
to have measures introduced. One of the possib ilities of constructive remedies for exporters from 
developing countries is the signing of an undertaking after dumping or subsidisation has been found to 
exist.   
Q44. EC has initiated and conducted anti-absorptio n proceedings. Could EC indicate the specific 
provision of the ADA/Article VI of GATT 1994  under which such action against dumping is 
justified? 
 
A: The ADA and Article VI of GATT 1994 do  not contain any explicit provision on anti-
dumping absorbtion, The anti-absorbtion procedure fo llowed by the EC aims at re-establishing the 
effectiveness of the measures when, in the period closely following the imposition of anti-dumping or 
countervailing duties, it is shown that the duties ar e being absorbed. From the GATT point of view 
this is to be seen as a form of review whose primary objective is to reassess the export price. 
 
Q45. Could EC separately provide details of the financial contribution provided by the 
Commission and Member States for the following: 
 - Research and development 
 - Environment purposes  - Aid to disadvantaged region  The data may be provided fo r the period 2001-2003 annually. 
 A: The details of the financial contributions provided by the Commission and Member States in 
2001 and 2002 can be found in the relevant chapters  of the EU New and Full Subsidy Notification 
G/SCM/N/95/EEC. Those for 2003 and 2004 will be  contained in next years notification. 
 
Q46. WTO Member made a commitment at Doha Mini sterial Meeting in para 4.2 of the Decision 
on Implementation Related Issues and Con cerns that members will exercise particular 
consideration before initiating investigations in the context of anti-dumping remedies on textile & 
clothing exports from developing countries previo usly subject to quantitative restrictions under the 
Agreement for a period of two years following full integration of this Agreement into the WTO. EC  
may please  explain the  action taken in their domes tic regulations to give effect to this commitment 
at Doha. 
 
A: The EC will fully honour its commitment as  set out under Doha Declaration para 4.2 to 
exercise particular consideration before initiating investigations in the context of antidumping 
remedies on textile and clothing exports from devel oping countries previously subject to quantitative 
restrictions.   
Indeed, it is standard practice of the EC institutions to observe all
 international commitments 
when taking antidumping action, regardless of wh ether these commitments are explicitly reproduced 
in the applicable EC legislation. As an example of this approach, the EC consistently fulfils its 
obligations under Article 15 ADA even  though this provision is not transposed into the applicable EC 
laws and regulations.   
The EC intends to follow the same line with re gard to the commitments made under the Doha 
Declaration.   
 
 
 WT/TPR/M/136/Add.2 
Page 23 
 
 
 Subsidies and Countervailing Measures  
 Q47. The EC may explain as to how it calculates the subsidy margin while examining the Indian 
duty neutralisation schemes etc. The EC must establish in each and every case how the duty 
neutralisation schemes are utilised and take into account for its calculation only that portion of 
benefit which exceeds the amount of duty paid/payable instead of countervailing the entire scheme.  
It may please be indicated whether such an approach is followed . 
 
A: In examining any duty neutralisation scheme (note: it is presumed that India is referring to schemes which provide for the remission or drawback of import charges, taxes, etc on inputs which 
are consumed in producing goods which are sub sequently exported), the EC has regard to the 
provisions of Annexes I and II of Council Regul ation (EC) No 2026/97 on protection against 
subsidised imports from countries not members of the European Community (which essentially 
reproduce Annexes I and II of the Agreement on Su bsidies and Countervailing Measures (ASCM)). It 
is first determined whether the country concerne d has a verification system/procedure in place to 
confirm which inputs are consumed in the production of the exported product and in what amounts. In 
cases where no system/procedure exists, where the system/procedure is not reasonable or where it 
exists but is not applied effectively, the exportin g country concerned would normally need to carry 
out a further examination of the actual inputs in volved to determine wh ether an excess payment 
occurred. In the absence of a reliabl e system/procedure or one which is  applied effectively and in the 
absence of the afore-mentioned “further examination” , the EC considers that the investigated scheme 
is not a permissible duty drawback system or s ubstitution drawback system within the meaning of 
Article 2(1)(a)(ii) of the above-mentioned Regulation (which is based on Article 1.1(a)(1)(ii) of the 
ASCM (including footnote)). In such circumstances,  the EC countervails the full benefits under the 
scheme. It is only in situations where a reliable and effectively applied system/procedure exists and 
where it is established that an excess payment has ari sen, that the EC would countervail the excess 
payment.  
 
Q48. In disregard of its well established practi ce of taking the depreciation period from the 
accounts of the company and overlooking the us eful life of the product, the EC has taken a 
different period of depreciation much more onerou s or in certain cases disadvantageous to the 
company.  EC is requested to clarify its exis ting practice and the circumstances under which it 
takes the accelerated period of depreciation instea d of depreciation from the books of account of 
the concerned producer/exporter.  
 
A: The EC is not in a position to provide comments on individual Antisubsidy proceedings. In 
term of EC’s policy in this area the following pr inciples laid down in the EC’s basic antisubsidy 
Regulation are applied: 
 “Article 7 (3) - Where the subsidy can be li nked to the acquisition or future acquisition of 
fixed assets, the amount of the countervailable subsid y shall be calculated by spreading the subsidy 
across a period which reflects the normal depreciation of such assets in the i ndustry concerned. The 
amount so calculated which is attributable to th e investigation period, including that which derives 
from fixed assets acquired before this period, sh all be allocated as described in paragraph” 
 
Q49. There is no provision in GATT 1994, the Anti-Dumping Agreement or the Agreement on 
Subsidies and Countervailing Measures which permits  a member to geographically stretch the 
applicability of anti-dumping measures to cover im ports into territory of countries which were not 
subjected to an anti-dumping/countervailing duty investigation.  Could EC indicate the relevant 
provisions in the WTO acquis which permits it to  extend   trade remedy measures which were 
applicable in EC-15 to cover imports into the entire territory of EC-25? 
 WT/TPR/M/136/Add.2 
Page 24  
 
A: It is true that there are no trade defence sp ecific WTO provisions that regulate the procedures 
to be undertaken in a situation of the enlargement of  customs union. In this situation the EC has made 
efforts to find an approach that would best preserve  the rights of all interested parties and, on this 
basis, considered that enlargement falls into a category of situations  that can be best addressed under 
the provisions of Article 11.2 ADA. In its most recent enlargement of May 2004 the EC has been 
consistent with the approach taken in the previous enlargement in 1995. 
It is clear that enlargement by itself does not  automatically vary the dumping, subsidy and 
injury parameters, which form the basis of every tr ade defence measure. In the vast majority of cases, 
imports of the product concerned into the new EU Member States are small co mpared to those into 
the EU-15. In addition, the overall industrial outpu t of the new Member States represents less than 5-
7% of the industrial output of the EU-15. All of this suggests that it would be legally unreasonable 
and superfluous to open automatica lly reviews of all existing trade defence measures, creating a 
significant burden for a great number of operators invo lved and resulting in no change for most of the 
measures. The EU’s approach is to open reviews fo r those cases where interested parties request such 
reviews and submit evidence that the measures would have been significantly different if they were 
based on information including the new Member Stat es. Accordingly, exporting producers in third 
countries were encouraged and are still welcome to  submit such requests for enlargement-related 
interim reviews. Alternative approaches, e.g., automatic suspension of measures or automatic ex 
officio  reviews, would be less appropriate for addressi ng the situation of the enlargement of a customs 
union, i.e., less compatible with the principles of the ADA including rights of domestic industry to be 
protected from injurious dumping. 
 
Textile-related issues
 
Lack of meaningful integration  
 Q50. The integration programme implemented by the importing countries has not been in line 
with the spirit of the ATC though it may have conformed to the narrow technical and legal 
requirements of the Agreement.   
It is ironical that while India has removed a ll import restrictions on textile products, save 
for a small list of  10 tariff lines at 8-digit level on account of safety and health exceptions, EC has 
kept the bulk of restrained products (about 79%) fo r integration till the very end i.e. on 31.12.2004. 
According to a recent EC Study, EC import restrictio ns on textiles and clot hing cost consumers 
almost EUR 25 billion every year, which means an extra annual cost of EUR 270 for a family with 
two children.  In this view, will EC explain the rea sons for deferring the integration till 31.12.04. 
 
A: For the record and to put things into perspec tive it is noted that India’s export of T&C to the 
Community in 2003 amounted to over 4 billion $ whereas EU’s exports to India amounted to 
220 mio. 
 The Community has faithfully adhered to the provisions of the ATC’s integration programme 
and in so doing respected the percentages and produ ct mix during each phase of integration With this 
in mind decisions to integrate products were ma de at the discretion of the importing country 
 
Issue of year-end shipments in 2004
 
 
Q51. There can be no dispute that trade into 2005 would have to be free of any restrictions.  GATT Article XI clearly provides that “No prohib itions or restrictions-whether made effective 
through quotas, import or export licences or other me asures, shall be instituted or maintained by 
any Member on the importation of any product of the territory of any other Member-“ Further, 
ATC provides that all restrictions shall stand terminated on 1
st January, 2005 and on this date, the 
sector shall be fully integrated into the GATT. This implies that all quota restrictions as well as all requirements relating to these restrictions would stand abolished on 1
st January, 2005. WT/TPR/M/136/Add.2 
Page 25 
 
 
 It may also be recalled that in previous in tegration stages, the categories which were 
integrated, the EC had not instituted any mechanism to check imports of integrated categories in 
the ensuing year.  It may also be worth mentio ning that additional levels of quotas due to 
enlargement of EC membership to 25, goods shipped before 1st May 2004 but reaching these 
countries after this date will be quota free.  For co nsignments which start arriving in the quota free 
situation of 2005 would need to be shipped in the final months of 2004 and any requirement of 
export visa would be uncalled for.  There would be hardly any legal ground to deny entry to those 
shipments reaching on or after 1st January, 2005. 
In order to provide predictability and conf idence to both exporters and importers, it is 
requested that the EC authorities issue fresh inst ructions to their respective customs authorities 
accordingly. We request EC’s  reaction to this request. 
EC is also requested to give a clarification to the effect that concurrent with the phase out of quota 
regime, the administrative requirement of the visa certificates would also be dispensed with effect 
from. 1st January 2005. 
 A: It is correct that restrictions shall stand terminated by the end of 2004. 
It is equally correct that exporting countries shall administer restrictions and that importing 
members shall not be obliged to accept shipments in excess of restrictions notified. The date of 
shipment has for decades according to bilateral agreements and sub sequently under the administrative 
arrangements been the determining factor for the setting off against quota. Consequently, shipments 
made during 2004 but with arrival in 2005 have to  be set off against the 2004 quota which the 
exporting country is bound to respect and the impor ting country entitled to enforce. If this were not 
the case provisions of article 4.1 would indeed be meaningless. Any other interpretation of the ATC 
would open an invitation to exceed bilaterally agreed quotas  
Textile/Clothings Quotas
 
 
Q52. EC has allotted some additional textile and cl othing quota based on the average of last 3 
years textile and clothing exports from India to these countries.  This methodology does not appear to be correct as it does not even protect the previou s years exports as it takes average of last 3 years.  
A better method would have been to take the highest import figure of the last 3 years and provide for at least 6% growth on that. We would request EC’s comments on this suggestion. 
 
A: In applying the method of the average of imports of the three last known years EC resorted to a well tested principle which diminished the risk of   the erratic fluctuations in trade patterns and 
consequently statistically provid es a safer basis for adjustment 
 Services Issues
 
Burden of social security contributions on short term Indian IT professionals working in EU 
countries  
 Q53. As per the local rules and regulations, Indian IT professionals on short-term assignment to their own branch offices/ subsidiaries or liaison o ffices are subjected to deduction of social security 
contributions from their wages drawn in the EU country concerned but because they are employed 
on a short term basis - say for a period of 3-4 years.  Such persons are deprived of the social security 
benefits when they return to India because, they are not entitled for the benefits, in case of a  
change in residence, in the absence of any bilateral social security agreement between India and the EU country concerned. 
The EU member countries follow varying practices in this regard. The U.K. allows 
exemption to all foreigners from social security contributions for up to 52 weeks of employment. 
Finland and Sweden allow repatriation of benefits after fulfilling the qualifying period to all WT/TPR/M/136/Add.2 
Page 26  
 
persons irrespective of their residence. Rest allo w this on the basis of bilateral social security 
agreements.   Will EU explain if it has any plans to take measures to ensure that the EU member States follow a common policy and provide the necessary benefits as mentioned above on a non-
discriminatory basis to all third country nationals .  
 
A: As regards natural persons, only EC citizens are beneficiaries of the internal market freedoms. 
Access of non-EC citizens to each Member St ate is governed by EC GATS commitments 
 
Need to make ENTs more transparent.
 
 
Q54. Can the EC clarify the conditions on the bas is of which ENTs are imposed while permitting 
entry of foreign service providers? What steps are being taken to make the ENTs transparent and 
objective? 
 A: The application of ENTs is an issue to be addressed in services negotiations under the DDA. 
 
Visas/Work Permit Issues
 
 Q55. Indian businessmen and professional seeking entry to the EU member countries in connection with work have to sa tisfy varying requirements for obtaining visas from different 
countries. Apart from the normal documentatio n, some countries require medical certificate, 
income-tax certificate, policy verification certificat e etc. which are unnecessarily burdensome for 
normal travellers seeking entry for business fo r work. These problems are especially acute for 
companies wishing to depute technical staff and pr ofessionals at various sites in the EU countries, 
including for fairs and exhibitions organized in  Europe. Such lack of harmonisation and the 
nature of the documentation requirement are found to be actual market access barriers for Indian 
professionals and businessmen. This is so even in  sectors wherein the EU has taken commitments 
for access for business travellers, for contra ctual service suppliers and for Intra-Corporate 
Transferees. How does the EU pr opose to tackle these issues? 
In connection with business visa, many EU  member countries also require letters of 
invitation from local companies, to accompany the initial application. This essentially means that 
Indian companies and professionals are denied the opportunity to carry out exploratory visit to 
markets of interest. How does this approach ge l with ECs commitments regarding access for 
business visitors who are representatives of the foreign service suppliers and seeking temporary 
entry for the purpose of negotiating for sale of  services and for setting-up a commercial presence of 
the service supplier in an EC member state.  
 
A: In relation to entry visa policy, attenti on is drawn to the GATS Annex on Movement of 
Natural Persons, and in particul ar paragraph 4 thereof which exclude entry visa measures and 
procedures from the scope of the GATS.  Notwithstanding this, the EC and their Member States are continuously working to improve visa processing procedures generally and to address specifi c problems which are brought to our attention, 
whilst at the same time ensuring that the integrit y of our visa systems and our external borders are 
maintained.  Entry visas procedures for persons entering an EU Member State to carry out an 
economic activity are determined by individual Me mber States and not at a Community level.   
 
Q56. Many Indian companies have multiple offices within the EU and need to post their 
employees, both Indian and third country nationals, seamlessly between these offices. It is 
understood that under the common market rules, co mpanies operating in an EU member country 
and wishing to supply short time services in another member country using either EU nationals or non-EU nationals, can do so on the basis of memb er state in which the company is established. WT/TPR/M/136/Add.2 
Page 27 
 
 
  However, despite this rule some member countries require that the companies obtained 
separate residence permits from the countries where the professionals are being posted. This 
requirement, clearly and unnecessarily burdensome one, that the company being hindered in the 
profession of services in the most efficient manner. Can the EU explain whether it intends to simplify and harmonise these rules so that such market access barriers are not regularized against 
service suppliers from country such as India.   
A: As regards natural persons, only EC citizens are beneficiaries of the internal market freedoms. 
Access of non-EC citizens to each Member St ate is governed by EC GATS commitments 
 Q57. Can it be confirmed that the EC’s commitm ents on Business Visas extended to persons 
visiting the EC for business discussions, project review meetings, short-term training on client platform studies to bring the project to off-sho re development centre, installation support & user 
training at client site fo r software development off-shore? 
 A: This is an issue to be addressed in services negotiations under the DDA. 
 
Q58. Companies carrying out out-sourced projects on behalf of EU companies naturally need 
access for their employees for short visits. This is often necessary for a clearer understanding of the 
requirements of the client company. However, even  for the entry of such service providers, some of 
the EU member countries need a regular work permit.  It is not legal to carry-out any work relating 
to installation of the system, harmonization of the systems of the clients and the customer etc. while 
on a business visa. This is, also seems to be unnecessarily onerous restriction. Can the EU 
respond? 
 
A: This is an issue to be addressed in services negotiations under the DDA 
 
Q59. Many of the EU member countries insi st upon imposing minimum salary requirements 
while granting work permits for foreign prof essionals for work. This condition is imposed 
particularly for the “highly qualified personnel” cate gory. The salary bench-mark is fairly high in 
such cases. This places burdenso me obligation and severely affect s the competitive advantage of 
the companies involved. Moreover, the definition of “highly qualified personnel” is not clear and is 
apparently open to interpretative discretion. This is unwarranted particularly since the EC has 
undertaken commitments providing access for contra ctual service suppliers in which there is no 
reference to any wage parity restriction. We request EU to indicate whether such requirement are likely to be done away with in order to fully e xploit comparative advantage in the services sectors. 
 A: This is an issue to be addressed in ser vices negotiations under the DDA. However, we note 
that access of non-EC citizens to each Member St ate is governed by EC GATS commitments, which 
includes definitions for key personnel.    
 
Q60. Local investment conditions: In a few EU  countries e.g. Luxembourg, the grant of work 
permits are often subject to restrictions in  terms of numerical ceiling on the number of 
professionals, and are linked, in some cases, to a certain minimum level of capital investment being 
made in the region or State before the permits are granted.  Besides, there is also a requirement of 
recruiting a certain minimum number of local employees for the Indian companies to establish a commercial presence in the Member’s territory and bring Indian professionals for their work.  The 
ratio of foreign to local employment expected by the authorities can be as high as 3:1.  This puts an 
extra and unwarranted burden on the Indian companies engaged in providing services in EU.  
There is no such market access lim itation in the EC’s GATS commitments in Mode 3 and Mode 4.  
 How does the EC explain this? WT/TPR/M/136/Add.2 
Page 28  
 
A: Access of non-EC citizens to each Member State is governed by EC GATS commitments. 
 
Delay in issue of visas/work permits
 
 Q61. No time-frame has been fixed for issue of visas causing avoidable inconvenience and 
disruption to the applicants’ work schedules.  It takes about 4-6 weeks to get a 3-month (or more) 
work permit approved by most EU Member-States, each of which has its own regulation on the 
subject. Usually, a client company has to wait for periods ranging from 3 weeks to 3 months to 
obtain a work permit. Sometimes, the applications a re rejected after this long wait. In a situation 
where the processing period is more than a month at the most, the client companies lose interest in 
the offer of the service provider and the contract falls. Such non-transparent and slow procedures 
act as a real market access barrier to the provision of services by companies/professionals in India. The period of processing should be standardized and reduced to a maximum of three weeks. We 
request EU’s comment on this issue. 
 A: The EC and their Member States are continuo usly working to improve procedures generally 
and to address specific problems which are brought to our attention, whilst at the same time ensuring 
that the integrity of our systems is maintained.  In 2001, the European Commission made a pr oposal to simplify and harmonise application 
procedures for work and residence permits thr oughout the EU, based on common definitions and a 
“one-stop shop” procedure. In the course of 2002 and 2003, the relevant Council Working Group 
worked on a first reading of this proposal. The Justice and Home Affairs Council of 27/28 November 
2003 took note of the state of play of the - difficult - negotiations. The Commission is currently considering publishing a Green Book on economic mi gration, with the aim of stimulating a broad 
consultation procedure with all interested parties and facilitating the drafting of a possible modified 
proposal  
Work permit for outsourced work
 
 Q62.  Even in the case of out-sourced proj ects, service providers entering Luxembourg for the 
purpose of commissioning/installing their system  require a regular work permit. Such service 
providers or professionals can not legally provide a service while they are on a business visa. A solution needs to be found by al lowing the persons on business visas to provide necessary services 
to their clients through the parent companies. We request EU to respond to this suggestion. 
 A: Schengen entry visas are only issued to pers ons who will not carry out an economic activity 
in the EU.  Persons who intend to carry out an economic activity, including service provision of the type mentioned above require a na tional visa and a work permit, within the limits imposed by the 
relevant Member State’s visa and immigration policies 
 
Professional Cards
 
 Q63. Self-employed non-EEA nationals and qua lified professional (doctors, lawyers, creative 
artists and sales people) need a professional card in order to practise their profession and/or 
provide consultancy in Belgium (and also other EU member-States).  The concerned person has to 
apply to the relevant authorities for such permit on an individual basis.  The card, which is valid 
for five years, is issued in Belgium by the go vernment agency the Federal Public Services for the 
Economy, SMEs Self-employment and Energy. In obtaining and renewing the professional cards, 
problems similar to those noticed as in case of obtaining work permits are encountered.   How does 
EU propose to reduce barriers by simplifying the procedure? 
 WT/TPR/M/136/Add.2 
Page 29 
 
 
 A: The EC and their Member States are continuo usly working to improve procedures generally 
and to address specific problems which are brought to our attention, whilst at the same time ensuring 
that the integrity of our systems is maintained. 
 Entry of third country nationals to carry out an economic activity is cu rrently permitted within 
the limits of the EC’s GATS commitments. In 2001,  the European Commission made a proposal to 
simplify and harmonise application procedures for work and residence permits throughout the EU 
including for self-employed persons, based on common definitions and a “one-stop shop” procedure. 
In the course of 2002 and 2003, the relevant Council Working Group worked on a first reading of this 
proposal. The Justice and Home Affairs Council of 27/28 November 2003 took note of the state of 
play of the - difficult - negotiations. The Commission is currently considering publishing a Green Book on economic migration, with the aim of stim ulating a broad consultation procedure with all 
interested parties and facilitating the drafting of a possible modified proposal.  
Data Privacy
 
 
Q64. There are data privacy norms in EU which are likely to come in the way of India’s e-
commerce with EU and process outsourcing of data operations to India. EU permits free transfer 
of personal data (Article 25 of the Data Protectio n Directive no 46/95) in electronic or other form 
from EU/EEA sources to the third countries only if the data protection regime in the concerned 
third countries EU is judged adequate i.e. the level of protection for data offered is the same as 
offered in the EU. It is understood that an EC offi cial must necessarily appr ove all proposals by EU 
companies to out-source any activity. This is done on the basis of a subjective analysis of the EU company, the foreign counterpart, the nature of the data etc. This provision can become a serious 
obstruction to the flow of data in the course of  business transactions and can even check BPO 
activities. As it is, many of the Indian small an d medium enterprises have virtually withdrawn from 
the BPO business in the EU because of difficu lties faced in proving compliance with the EC 
requirements. How does the EC propo sed to reduce barriers and restrict the impact of this measure 
to the actual requirement of data protection?  EU insists on such safeguards being a part of contractual arrangements between the parties involved. While the Indian companies are, in the short run, conducting their work on the 
basis of contractual agreements with their European  counterparts, this is likely to delay and cast 
additional burden on the exporting companies in developing countries like India. Does EU  
propose to grant recognition to Indian data protection regime to enable a more conducive  business environment ? 
 A: The 95/46 EC data protection Directive allows transfers of personal data to non-EU countries 
if either the destination country ensures an adequate  level of protection (Artic le 25 of the Directive) 
or, by way of derogation from Article 25, if adequate  safeguards are put in place (Article 26) so that 
personal data transferred also enjo y an adequate of protection, even  if the destination country as a 
whole does not ensure such level.  The possible adequacy afforded by the third country shall be assessed in the light of all 
circumstances surrounding the transfer operation, acco rding to Article 25 (2) of the Directive. The 
notion in Article 25 according to which the level of protection shall be ‘a dequate’ does however not 
require that it shall be ‘equal’ or the ‘same’ in th e third country in question, but that a number of key 
data protection principles are set up and applied.  As regards the procedure to be followed fo r an adequacy findi ng, the Commission, upon 
request of the third country and in close co-operati on with the Working Party 29 (composed of the EU 
Member States’ independent data protection comm issioners and established under Article 29 of the 
data protection Directive) and the Member States, will assess the level of protection in the third country in question and, in case this level is adequate, will decide so. WT/TPR/M/136/Add.2 
Page 30  
 
India should therefore enact a data protection law th at provides for such ade quate protection and, once 
this law is applied in practice, make a requ est for an adequacy finding to the Commission. 
 In the absence of such adequacy  finding, data transfers to India will have to take place under 
Article 26 of the Directive, with contractual clau ses under Article 26 (2) being a possible legal basis 
for transfers. It is however not to the Commission to authorize such transfers in any way, but this is 
left to Member States, with no authorization be ing required when use is made of the Commission 
standard contractual clauses.   (See http ://europa.eu.int/comm/in ternal_market/privacy/ 
modelcontracts_en.htm ).  The attached document gives an overview of how the Article 29 Working 
Party applies Articles 25 and 26 of the data protection Directive. http://europa.eu.int/comm/ 
internal_market/privacy/docs/wpdocs/1998/wp12_en.pdf 
 
Professional Services:
 
 Q65. In architectural services, many member countries of the EC impose a residency stipulation 
for grant of license to provide architectural se rvices. This requirement appea rs to be inconsistent 
with the EC’s GATS commitments since a limitation of residency has been imposed only in respect 
of Italy and Greece. How does the EC justify this? Likewise in Accounting Service (other than auditing) the only countries with a residency stipul ation are Denmark and Italy. Yet, residency is a 
requirement for license to practice in several EU states.  
Furthermore, many countries make prior residency a requirement for eligibility for 
registration with the licensing body. However, visa s are often not granted to foreign professionals 
who wish to enter in order to fulfil the resi dency requirement for licensing. How does the EC 
explain this contradiction? 
 
A: Access of non-EC citizens to each Member  State is governed by EC GATS commitments. 
Nevertheless, the EC and their Member States are continuously working to improve procedures 
generally and to address specific problems which are br ought to our attention, whilst at the same time 
ensuring that the integrity of our systems is maintained. 
 
Q66. EU also does not grant recognition to its ow n professional degrees e.g. dentistry if it was 
obtained by a non-EU national. In a specific ca se, an Indian national holding such a degree 
obtained from the University of Semmelweise in Bu dapest has not been allowed to be registered by 
the General Dental Council (GDC) of the UK despit e the existence of the EU directives on mutual 
recognition of such degrees. This has been denied on  the ground that a European degree held by a 
non-EEA national is not valid for registration as dentist in the UK unless she or he passes further 
International Qualifying Examination. Ho w does EU intend to address such cases?  
 
A: As regards natural persons, only EC citizens are beneficiaries of the internal market freedoms. 
This is expressly mentioned in a horizontal limitation in the EC GATS schedule of commitments. 
 
QUESTIONS FROM BRAZIL 
 
I) Import prohibitions, restrictions and licensing
 
 
Q1. In Chapter III (Trade Policies and Practices  by Measure), Paragraph 45 of document 
WT/TPR/S/136, it is stated that "The EC al so implements import prohibitions, licensing 
requirements, and other restrictive trade measures  in accordance with international conventions 
and treaties (...) The EC also applies import prohib itions, surveillance, and controls on grounds of 
technical requirements (including standards, sanitary and phytosanitary, and environmental 
requirements)". It is mentioned that the EC applies technical barriers to trade under TBT. How 
does the EC apply these procedures? WT/TPR/M/136/Add.2 
Page 31 
 
 
 A: The interpretation of paragraph 45 of Document WT/TPR/S/136 made by Brazil is 
misleading. Brazil draws the conclusion that “ it is mentioned that the EC applies technical barriers to 
trade under TBT ”, but this is not the case. 
 The EC is concerned by the protection of huma n health and safety, animal or plant life or 
health, and the environment, and other legitimate objectives. However, EC technical regulations are 
not more trade-restrictive than necessar y to fulfil such legitimate objectives. 
 The EC is undoubtedly a fairly open market, as far as technical regulations, standards and 
conformity assessment are concerned. Especially in  the New Approach areas, the conformity of a 
wide number and range of products  can be certified by means of a Supplier Declaration of Conformity 
issued by the manufacturer without third party or public authority intervention. 
 In order to be placed on the market, products  must fulfil the essential health and safety 
requirement foreseen in the applicable EC legisla tion. Member States’ market surveillance authorities 
have the responsibility to take action against not compliant products, notably by withdrawing them 
from the market. This is done in a open and tran sparent way, and manufacturers have the right to 
oppose such actions and contest their legitimacy. 
 
Q2. In the Secretariat Report, Paragraph 48 of Chapter III (Trade Policies and Practices by 
Measure), it is stated as follows: "The EC has bilateral arrangements on trade in textile and 
clothing products with the following WTO Me mbers: Armenia; Bangladesh; Croatia; Egypt; 
Kyrgyz Republic; Moldova; Mongolia; and Sri La nka. Under these arrangements, the EC applies 
double-checking surveillance without quantitativ e restrictions. The EC applies quantitative 
restrictions, on an autonomous basis, on impor ts from Bosnia and Herzegovina, Democratic 
People's Republic of Korea, and Serbia and Mont enegro. Furthermore, surv eillance of imports of 
textile and clothing products under the double-chec king system also applies under agreements with 
certain countries not members of the WTO..." Does the EC intend to continue adopting the 
"double checking" surveillance after the end of th e ATC? Is it under consideration to suspend at 
least one of the required documents? 
 A: As from 2005 double checking will be maintain ed for Vietnam, Uzbekistan, Serbia and 
Montenegro, North Korea and Belarus, it being point ed out that this may be subject to alteration 
following negotiations. 
 
II) Rules of Origin
 
 
Q3. In accordance with WT/TPR/S/136, Chapter III (Trade Policies and Practices by Measure), 
Paragraph 37, "The EC applies both non-preferentia l and preferential rules of origins. Its non-
preferential rules of origin are contained in the customs code and corresponding implementing regulations; the preferential rules of origin are set out in the relevant preferential trade 
agreements/arrangements (...)". Since the EC adopt s preferential and non-preferential rules of 
origin, could the EC please inform us which are the authorities responsible for the issuing of the certificate of origin? 
 A: Competent authorities or authorized agen cies of the Member States are the authorities 
responsible for the issue of certificates of or igin for goods originated in the Community. 
 III) Safeguards and antidumping
 
 
Q4. Chapter III (Trade Policies and Practices by Measure), Paragraph 55, of document 
WT/TPR/S/136 affirms that "Separate safeguard provisions apply to non-WTO members, and to 
imports of textile products from certain third countries. On 3 March 2003, the EU adopted a 
regulation, that amended its regulation on non- WTO Members, to bring into line its safeguard WT/TPR/M/136/Add.2 
Page 32  
 
provisions on imports from th e People's Republic of China with the transitional provisions 
contained in China's Protocol of Accession to the WTO". What kind of amendments have the EU authorities adopted as regards the abov e-mentioned safeguard provisions? 
 A: EC Regulation No 519/94 contains safeguard  provision applying to non WTO Members. It 
applies only to selected countries that  are specified in a list attached thereto. This regulation has been 
modified by EC Regulation No 427/03 of 3 Marc h 2003, which provided for the deletion of China 
from the list of subject countries following its acce ssion to the WTO. Since that date, China falls 
under the rules of EC Regulation No 32852/94. EC Regulation No 427/03 also provided for the incorporation into EC legislation of the Trans itional Product Specific Safeguard Mechanism contained 
in Paragraph 19 of China’s Protocol of Accession to the WTO has been incorporated. Finally, EC 
Regulation No 138/03 of 21 January 2003 provided for the incorporation into EC legislation of the 
special safeguard provision on textiles contained in  paragraphs 241 and 242 of the Report of the 
Working Party on China’s accession to the WTO.  
Q5. Regarding the Secretariat Report, Chapter III (Trade Policies and Practices by Measure) 
paragraph 60, "(...) anti-dumping duties are to be im posed if three conditions are met: (i) a finding 
of dumping; (ii) a determination of material injury to the Community industry; and (iii) it is in the interests of the Community..." Could the EC pr ovide a more specific definition of the term 
"interests of the Community"? 
 
A: The community interest is defined in Artic le 21(1) of Council Regulation (EC) No 384/96 of 
22 December 1995 on protection against dumpe d imports from countries not members of the 
European Community.  
“Article 21- Community interest 
1. A determination as to whether the Community  interest calls for intervention shall be based 
on an appreciation of all the various interests taken as a whole, including the interests of the domestic 
industry and users and consumers; and a determination pu rsuant to this Article shall only be made 
where all parties have been given the opportunity to make their views known pursuant to paragraph 
 2. In such an examination, the need to elim inate the trade distorting effects of injurious 
dumping and to restore effective competition shall be given special consideration. Measures, as 
determined on the basis of the dumping and inju ry found, may not be applied where the authorities, 
on the basis of all the information submitted, can cl early conclude that it is not in the Community 
interest to apply such measures[…].  Information on community interest is gath ered from the interested parties i.e. the 
complainants, importers and their representative associations, representative users and representative 
consumer organization and additional informati on will be sought if necessary (ex. statistics). 
 It has to be noted that the community interest is not mandated in the WTO ADA 
Nevertheless, the community applies this test in all trade defense proceedings to ensure a high 
standard in applying trade defense instruments.   
Q6. Still regarding Chapter III of the above mentioned document, Paragraph 62 states that "At 
the time of their accession, new members must apply EC anti-dumping measures in place; their 
own measures will lapse". Could the EC explain wh ether these measures are automatically lapsed? 
 A: We can confirm that the national AD legislati on, measures and on-going investigations of the 
countries that joined the EC automatically la psed as of 1 May 2004. This occurred because upon 
accession to the EC these countries automatically became subject to th e EC Common Commercial 
Policy and trade defence actions are within  the exclusive competence of the EC. 
   WT/TPR/M/136/Add.2 
Page 33 
 
 
 IV) Trade Regime  
 Q7. In the Secretariat Report, Paragraph 15 of  Chapter I (Economic Environment), it is stated 
that "Long-term sustainability of  public finances in the EC-15 is hampered by the relatively high 
levels of government debt, partly due to ageing po pulations. In 2003, public  debt remained above 
60% of GDP in six member States, particularly  Italy (106.2%), Greece (103%), and Belgium 
(100.5%). Despite recent pension system reforms un dertaken by Austria, Finland, France, Greece, 
Portugal, and the UK, the ratio of government debt to GDP in the EC-15 increased from 63% in 
2001 to 64.1% in 2003, while in the euro zone, it ro se from 69.4% to 70.4%. Overall, the ratio in the 
EC-15 and in the euro zone is above that of the C-10; Cyprus (72.2%) and Malta (72%) exceed the 60% benchmark". In the Commission’s view, what is the specific role of the trade policy in order to 
diminish such debts and improve public finance across the EC?  
A: Unlike in some other WTO Members, tariff duti es constitute only a marginal source of public 
revenue in the EC. Furthermore, collected tariff du ties are used to fund the EC budget, and are not a a 
source of revenue financing the budget of th e Member States. Likewise, export refunds for 
agricultural products are financed by the EC budge t and have no impact on the public deficit of its 
Member States. It should also be noted that the EC  is not allowed to run deficits or to borrow to 
finance its budget, which represents less than 1.5% of  the GDP of the EC and is always balanced. The 
EC trade policy as therefore no direct impact on the public finances of the EC Member States. 
The EC trade policy might have an indirect impact on the sustainability of public finance of 
EC Member States through its incidence on growth and interest rates. One of the objectives of the trade policy is to promote increased growth, which in  turn has a positive impact on the sustainability 
of public debt. Another traditional objective of trade policy is to contribute to balancing external 
accounts, which is a condition for keeping interest rates low and thereby reduce the burden of debt 
repayment on public budgets. 
In sum, although it can indirectly contribute to reduce public deficits and improve the 
sustainability of public debt of the EC and its Memb er States, the EC trade policy has no specific role 
in that respect.   Q8. Document WT/TPR/S/136, Chapter II (Trade Regime), Paragraph 28, affirms that "The 
EC's web of preferential trade agreements, with different trade liberalization agendas and trading 
rules (including rules of origin), further complic ates its trade regime. The limited liberalization (so 
far) of agriculture under the agreements has hind ered its exposure to competition. Furthermore, 
for preferential trading partners, absence of, or dela ys in, the alignment of their regime may lead to 
trade diversion to the detriment of their exports". Since the EC has long argued that agricultural 
subsidies should be dealt with on a multilateral basi s, what specific aspects in agricultural market 
access should be negotiated in the WTO, and what sh ould be left for preferential trade agreements? 
 
A: One of the EC’s main trade policy objectives is to promote sustainable development more 
broadly by ensuring that all countries are capable  of harnessing globalization and of benefiting from 
the expansion of trade. Therefore, the increased participation of developing and least developed 
countries in the international trading system is a strong priority for the EC. Preferential arrangements 
are, as a complement to the WTO, important instruments to that end.  
Just as the ongoing Doha Development Agenda pl ays a vital role for the modernization and 
imrpovement of global trading regime, WTO memb ers preferential arrangements could be improved 
further. The Secretariat’s Report refer to that eval uations of preferential trad e agreements in general 
(including also agreements concluded by the EC) provide ambiguous result, but that most studies find a positive, albeit small, welfare impact on countri es participating in preferential trade agreements. 
This is also why the EC is continuously assessi ng the effectiveness of its preferential trading 
agreements. The conclusion of the Cotonou Agreemen t was e.g. based on studies analyzing the effects WT/TPR/M/136/Add.2 
Page 34  
 
of the Lomé Convention. Similarly, the propo sal for a revised GSP was based on underlying 
examinations of the impact of the current GSP. The EC has also evaluated the effectiveness of its 
trade measures towards other group of countries or regions.  While preferences certainly is no panacea, it shoul d be stressed that the EU today is by far the 
largest market for products originating in developi ng countries, including agricultural products. The 
EC would like to recall the fact that the frame work agreement on agriculture dated 1. August 2004 
fully recognized the importance of long-standing preferences for developing countries.  
Q9. In WT/TPR/S/136, Paragraph 41 of Chapter II (Trade Regime), it is stated that "Several 
studies confirm that the Europe Agreements stimul ated substantial growth in trade between the EC 
and acceding countries. (...) In general, given th at EC tariffs are lower than acceding countries', 
the adoption of the CCT is expected to put downw ard pressure on prices in new member States. 
However, for acceding countries with  relatively lower customs duties (see Annex I.1 for statistical 
tables on Estonia, Latvia, Lithuania, and Malta), there could be a rise in prices. Furthermore, prices of certain agricultural products are expect ed to rise as a result of the adoption of the 
common agricultural policy (CAP)". In the Commission’s view, how would the trade impacts 
deriving from the accession of ten new memb ers affect EC’s willingness to further pursue 
preferential trade agreements?  
A: The framework agreement on agriculture of 1 August 2004 fully recognizes the importance of 
long-standing preferences for developing countries.  The subject needs, however, to be further 
elaborated and therefore it is impossible to speculate on the outcome.  V) Services
 
 
Q10. The first footnote related to paragraph 91 of  Chapter IV (Trade Policies by Sector) of the 
Secretariat Report states that "In 2002, a Co mmission report listed 92 remaining barriers 
encountered by companies wishing to offer servi ces in more than one EC country, 'Financial 
Times', 18 November 2003". Could the Commission pr ovide the list of those barriers and indicate 
the regulations related to them? 
 
A: "The Commission's report, published in July 2002, found that barriers (within the meaning of the EC Treaty, as interpreted by the European Court of  Justice) affected a very wide range of sectors. 
Such barriers arise not only from regulatory or administrative action by Member States  but also from 
self-regulation, or the practices of professional bodies. They may include, for example, complex, lengthy and burdensome authorisation procedures, highly detailed and divergen t rules on advertising, 
burdensome and complex administrative formalities relating to employment law in the context of 
cross-border posting of workers, or, simply the dup lication of requirements such as for deposits and 
guarantees, professional insurance or quality controls  which the service provider has already fulfilled 
in his Member State of origin. The information in  the report, and the further consultation and legal 
and economic analysis which followe d it, were important factors in determining the shape and content 
of the Commission's proposal for a Directive on Serv ices. Further information can be found at the 
Commission's Internal Market website:  http://e uropa.eu.int/comm./internal_market/en/services/ 
services/index.htm.   
 
Q11. In the Secretariat Report, Paragraph 93 of  Chapter IV (Trade Policies by Sector), it is 
stated that "The EC-15 has tabled its initial cond itional offer in the ongoing services negotiations". 
Regarding the "initial conditional offer", please indicate: a) the criteria and definitions applied to Ec onomic Needs Test (ENT) in the following 
services: 
 - Computer and Related Services (CPC 84) - Italy  - Higher education services (CPC 923) - Spain, France, Italy WT/TPR/M/136/Add.2 
Page 35 
 
 
  - Entertainment services (CPC 9619) - Italy 
 - Limousine services (CPC 71222) - Italy and Portugal  - Maritime Auxiliary Services – Italy 
b) the elements utilized in the definition of the following criteria on ENT: 
(i) Local demand:  -  Medical services (CPC 9312) and midwives services (CPC 93191) - Germany 
 -  Freight transportation (CPC 7123) - Italy 
 -  Passenger transportation (CPC 7122) - Spain 
 -  Taxi services (CPC 71221) - All Member States 
 -  Assessment of the labour market s ituation - Research and Development Services 
(CPC 851-853) - France 
 -  Construction and related engineering services (CPC 511-518) - France and United 
Kingdom (ii) the population and the geographical density: 
 -  Retailing Services (CPC CPC 631, 632,  633, 61112, 6113, 6121 excluding 63211) - 
Belgium, Denmark, France, Ireland, Portugal  - Services provided by pharmacists (Supply and retail distribution of pharmaceutical 
goods - (part of CPC 63211) - Belgium, Germany, Denmark, Spain, France, Ireland, Portugal 
 -  Wholesale pharmacies (part of CPC 622) – France c) the regulations that cover all ENT applied by EC Members; 
d) the definition of 'public utilities', mentioned in horizontal commitments; 
e) the elements that will be considered in th e application of numerical ceiling in "Independent 
Professionals", mentioned in horizontal commi tments, including its distribution among the 
activities (eg. Architectural services, Engineering and Computer services, etc.)  A: These questions raise issues that are to be  adressed in services negotiations under the DDA, 
for which the TPRM is not a substitue.  
VI) Government Procurement
 
 
Q12. In document WT/TPR/S/136, Chapter III (Trade Policies and Practices by Measure), 
Paragraph 99, it is affirmed that "The last TPR of the EC referred to two proposals for new 
directives on public procurement, one on the coor dination of procedures for the award of public 
works contracts, public supply contracts, and pu blic service contracts, and the other coordinating 
the procurement procedures of entities operating in the water, energy, transport and postal services 
sectors..." Which are the main changes that brough t simplification in comparison with the previous 
text on the coordination of procedures "for th e award of public works contracts, public supply 
contracts, and public service contracts" (Directives 93/37/EEC, 93/36/EEC, 92/50/EEC) and of 
"entities operating in the water, energy, tran sport and postal services sectors" (Directives 
92/13/EEC, 93/38/EEC)? Does this modification concern Directive 89/665/EEC?  
A: One of the main objectives of the EC public procurement reform was to make the new EC 
directives on public procurement more understanda ble to anyone involved in public purchasing 
whether as a purchaser or as an economic operator. As a consequence , current Public Procurement 
directives were codified and redesigned to form two coherent texts. Just to give an example of the 
simplification achieved: 
 Currently, there are 4 Public Sector Directives (92/50/EEC, 93/36/EEC, 93/37/EEC and 
97/52/EEC) with a total of 117 Articles. The new “Classic” Directive (2004/18/EC), which replaces 
all four, contains just 84 Articles. WT/TPR/M/136/Add.2 
Page 36  
 
 The new Directives are more user-friendly: ne w provisions follow the logical order of an 
award procedure. The new structure, like the new provisions, is conceived as a genuine vade-mecum  
intended to guide the users through a ll the stages of the award procedure. 
 Thresholds, which determine th e application of the new Directives, were also simplified and 
are from now on expressed in Euro instead of in "Special Drawing Rights".  These modifications do not affect Directive 89/665/EEC. 
 
Q13. Regarding the above mentioned paragraph 99, why, after enlisting water, energy, and 
transport sectors, is it mentioned postal services se ctors instead of the telecommunications sector, 
as it used to be the case in the text s concerning Directives 92/13/EEC and 93/38/EEC? 
 A: Due to the effective liberalization of the telecommunication sector at EU level, it was 
considered no longer necessary to regulate purchases by entities operating in this sector. As for postal 
services, given that postal services are provided thro ugh a network, it was considered that contracts 
awarded by contracting entities providing postal servi ces should be subject to the rules of the new 
“utilities” directive (2004/17/EC).  Q14. Paragraph 92 of Chapter III (Trade Policies and Practices by Measure) asserts that "Under the current legislative framework, there a re directives on public supplies, works, and 
services, complemented by a remedies directive. An other directive concerns the procurement by 
publicly owned entities and private entities with special or exclusive rights operating in the water, 
energy, transport, and telecommuni cation areas (utilities directive); this  is also complemented by a 
remedies directive...". What does th is “remedies dire ctive” refer to? 
 
A: “Remedies” Directives are Directives  89/665/EEC and 92/13/EEC. Under “Remedies” 
Directive 89/665/EEC, an unsuccessful applicant or te nderer is entitled to challenge contract award 
procedures by contracting authorities before nationa l review bodies such as Courts or specialized 
administrative bodies. In respect of the remedies av ailable prior to the signature of the contract, 
national review bodies must be empowered to take  at the earliest opportunity and by way of 
interlocutory procedures, interim measures incl uding the suspension of the award procedure. 
According to the EC remedies directives, national reme dies must also provide fo r the possibility to set 
aside illegal decisions, i.e. by removing discriminatory specifications or canceling the award decision. 
For utilities only (directive 93/38/EC), and pursuant to Directive 92/13/EEC, some Member States 
have replaced these two remedies by such measures as the payment of daily fines with the aim of 
correcting infringements and preventing injury to the interests concerned.  Under both remedies 
directives  some Member States have used the optio n to limit the remedies available to the award of 
damages to aggrieved tenderers when  the contract is signed. Furthermore, in some Member States, the 
claim for damages has to be brought before  a distinct body such as a Civil Court.  
 
Q15. In The Secretariat Report, Chapter III (Trade Policies and Practices by Measure), 
Paragraph 98, it is stated that "According to th e Commission, the EC's public procurement market 
is still not sufficiently open and competitive; public purchasers, particularly at the local government level, are unaware of the full extent of the rules, which may a ccount for the low level 
of cross-border procurement...". What is the strategy  that the EC intends to implement to inform 
the rules that local government should observe in order to implement commitments that the EC has 
undertaken in its international agreem ents on government procurement? 
 
A: The Internal Market Strategy 2003-2006 c ontains the actions the Commission suggested in 
2003 to improve the functioning of the EU proc urement markets (document COM(2003) 238 final of 
7.5.2003). The Commission regularly reports on the im plementation of the Internal Market Strategy 
(cf. the Report on the implementation of In ternal Market Strategy (2003-2006) (document 
COM(2004) 22 final of 21.1.2004). The most important recent actions are the following: WT/TPR/M/136/Add.2 
Page 37 
 
 
 • On 31 March 2004, the “legislative package” that consolidates and modernizes the current EU 
public procurement rules was adopted. The legisla tive package consists of Directive 2004/17/EC of 
the European Parliament and of the Council of  31 March 2004 coordinating the procurement 
procedures of entities operating in the water, energy, transport and postal services sectors (OJ L 134 
of 30.04.2004, p. 1) and Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply 
contracts and public service contracts (OJ L 134 of 30.04.2004, p. 114). The EU Member States are 
required to implement these directives into na tional law by 31 January 2006 at the latest. 
• On 30 April 2004, the Commission presented a gr een paper on public-pri vate partnerships 
and Community law on public contracts and concessions . The aim of this paper is to launch a debate 
on the application of Community law on public contracts and concessions to the public-private 
partnership phenomenon. 
• On 23 September 2004, the Commission adopted  a green paper on defense procurement 
(COM(2004)608 final) to develop a debate on the gr adual creation of a European defense equipment 
market.   Work on the other procurement-related topics incl uded in the Internal Market Strategy 2003-
2006, such as the review of the procurement remedies directives and the action plan on e-
procurement, is in progress.  Q16. It used to be estimated that the bila teral agreement between the EU and the US on 
procurement, signed on 15th April 1994, would open  around 200 billion ECU of public contracts to 
competitive bidding. What amount has the EU e ffectively accessed in government procurement 
contracts of the US in 2002 and 2003, after ten years of the agreement? 
 A: Please see below. 
 
Q17. With regard to the Free Trade Agreement EU-Mexico on government procurement, what 
participation do Mexican suppliers have in governm ent procurement contracts at the EU in 2002 
and 2003? 
 A: Please refer to statistical reports published or to be published in relevant Committees (for 
instance GPA committee).  VII) Competition Policy
 
 
Q18. In the Secretariat Report, Paragraph 115 of Chapter III (Trade Policies and Practices by 
Measure), it is stated that "During the period under review, major reforms have taken place in 
most areas of the EC's competition policy in order to meet the challenges of an enlarged union, as 
well as to address the structural problems that limit the competitiveness and hamper the growth 
opportunities of the European economy". What are those reforms? How does the EC intend, 
henceforth, to tackle the competition exper tise and economic gaps between the EC-15 and C-10? 
 
Q19. Will the new members be under the same EC’s competition rules and enforcement or will 
they be under S&D treatment and technical assi stance? May the Commission undertake special 
and separate cooperation agreements with the new acceding members? 
 Q20. Which are the Commission initiatives and plans to promote competition advocacy and 
culture within the ten new countries?  
 
 WT/TPR/M/136/Add.2 
Page 38  
 
A: Combined Answer to Qs 18, 19 and 20
 
 The Enlargement of the EU on 1 May 2004 coin cided with the entry into force of major 
reforms of the internal competition rules of the EU , in particular a radically reformed procedural 
regulation on anti-trust matters and a new merg er regulation. These reforms are described and 
explained in a special edition of the Competition policy newsletter, which can be provided on paper, 
and which is also available online, at the follo wing URL:  http://europa.eu.int/comm/competition/ 
publications/special/special_toc.html  A key element of the reforms has been the creation of the European Competition Network (ECN), of which all competition authorities in the EU  are members. It is the framework for the intense 
cooperation required to ensure a correct case allocation and a consistent application of the rules. The 
authorities have the power to exchange confidential information, to use such  information as evidence 
in their respective proceedings an d are subject to various informat ion obligations in their cases. The 
ECN is a flexible and informal network: it does not  take ‘decisions’ and cannot compel its members to 
act in a certain way. It is, however, expected that  the constructive character of the discussions will 
help solve most of the issues which may arise. Sh ould a deadlock occur, the Commission retains the 
power to relieve national competition authorities of their competence by opening proceedings. 
 It should be emphasised that, before enlargement took place, there was a long period of preparation of the ten new Member States in the field of competition policy, with significant amounts 
of technical assistance. Areas covered included th e establishment of a full market economy with a 
competition culture, the adoption of competition rules,  the creation of an independent and adequately-
resourced competition authority, the training of st aff and the creation of an adequate enforcement 
record. It was only possible for the ten new Member States to join the EU once all of those criteria 
were fulfilled.  For that reason, the new member states are equal partners with the EU15 as regards competition policy. It should not be considered th at there is any “gap” in competition culture or 
competition enforcement between the EU15 and the ten new member States, and there are no 
exclusions or special rules in force for the ten new Member States as concerns anti-trust policy. 
Separate agreements between the Commission and certain Member States are not possible; co-operation between the Commission and the national competition authorities of the member states takes place via the ECN.   Regarding competition advocacy, this is important for all EU member states, not just the ten 
new member states. Advocacy is a key part of the role of any competition au thority, and involves two 
tasks: firstly making sure that the government and public authorities take into account fully the 
requirements of competition in their decisions, and making the wider public and business community 
fully aware of the requirements and benefits of co mpetition law. For linguistic  and cultural reasons, 
this task is best carried out at a national level within the member States. However, one EU-level 
advocacy initiative which should be emphasised is the organisation of an annual European 
competition day, normally in the EU member State which holds the presidency of the EU. Furthermore, two important advocacy tools produced  by the European Commission, and available in 
all Community languages are:  The Communication “a proactive competition po licy for a competitive Europe” (available at 
the following URL:  http://europa.eu.int/comm/competition/publications/#proactive). 
The brocure on “European Competition policy and th e citizen” (available at the following URL:  
http://europa.eu.int/comm/competition/pub lications/competition_policy_and_the_citizen/). 
 
Q21. Are imports of new, used, recapped or refor med tires subject to any special procedures by 
the EC (technical regulation observan ce, environmental requirements)? 
 
A: Tyres in the European Union are subject  to the following European legislation: 
• Directive 92/23/EEC + amendment 2001/43/EC; UN Regulations 30, 54 
• UN Regulation 64 (spare wheels/tyres) 
• Directive 97/24/EC, UN Regulation 75 (tyres for motorcycles and mopeds) WT/TPR/M/136/Add.2 
Page 39 
 
 
 • UN Regulation 106 (tyres for tractors) 
• UN Regulations 108, 109 (retreaded tyres)1. 
 The UN Regulations cited above refer to Re gulations concluded under the United Nations 
Economic Commission for Europe's (U N/ECE's) Revised 1958 Agreement. 
 The above-mentioned Regulations and Directives are applicable to tyres, irrespective of 
whether they are imported or manufactured in the Community. 
 
VIII) AGRICULTURE  
 Q22. The reform process of the CAP is well underw ay, despite some initial political hurdles that 
led to delays in its launching. The overall direc tion to lower distortions and greater market 
orientation is in the right way. Nevertheless, th e reform pace is rather slow and the assessment of 
its impact in terms of commodities is difficult to be evaluated. Indeed, the CAP involves an exceptionally large number of measures and variabl es to be taken into account. Finally, some key 
sectors are yet to have the framework for its reform completed. a) In the dairy sector, which responds for a sizeable share of EC´s farm production, the quota 
system will be prolonged until 2015. The intervention price cuts appear not to be sufficient to bring 
European prices in line with international pri ces thus making it difficult to eliminate export 
subsidies for dairy products. Is a further reform for the dairy sector envisaged? 
 
A: Annex I of Council Regulation (EC) No 1788/200 3, establishing a levy in the milk and milk 
products sector, establishes reference quantities fo r Member States until the 2014/2015 twelve-month 
period, beginning on 1 April 2004. 
 At the time of the adoption of the 2003 CAP Reform, the Commission engaged itself to present a market outlook report for the EU dairy sector  once the reform is fully implemented, on the 
basis of which a decision will be taken on an a dditional general quota increase in 2007 and 2008. 
 
b) The CMO for sugar is a blatant example of ma rket distortions. The Secretariat reports that 
European intervention price is three times higher than international prices. Notwithstanding, the 
EC is the second largest exporter of sugar and th e third largest producer. When will Commissioner 
Fischler´s proposal for sugar reform be taken up for decision-making?  
 
A: The average trading price on the world market  does not necessarily reflect the right level of 
the average costs and prices of the sugar on the world market. Therefore the EU price is not 
necessarily a blatant example of market distortion.  The reform of the EU sugar CMO is needed to put this sector in line w ith the principle of the 
newly designed Common Agricultural Policy. Co mmunication [COM(2004) 499 final] of 14 July 
2004, from the Commission to the Council and the Eur opean Parliament, accomplishing a sustainable 
agricultural model for Europe through the reform ed CAP and presenting the sugar sector reform, is 
currently under discussion in the Institutions of th e EU. In light of the pressing need to lay the 
foundations of a new sugar regime, the Commission h as proposed that the reform be of immediate 
application, beginning in the 2005/06 campaign for a period of three years, subject to a review in 2008. In view of the need to await the appointment of the new Commission, the legal text relating to 
the proposal outlined in the Communication ca nnot be adopted before the end of 2004. 
 
c) In the sugar sector, production quotas are presently much larger than EC’s internal consumption. The project of reform proposes a cut on  the intervention price that will keep it twice 
                                                     
 
1 The EC has acceded to these two Regulations, but has not made them mandatory yet (this is pending); 
however, in some Member States, they are already ma ndatory. In all Member States, they are accepted as 
alternatives to any other national legislation. WT/TPR/M/136/Add.2 
Page 40  
 
as high as the international prices and the reduc tion would be compensated by direct payments to 
beet producers. In the absence of an internal co mmon market based on free competition, is there 
any intention to reduce production quotas in or der to adapt them to EC’s commitments concerning 
domestic support and export subsidies? 
 A: The reform proposal as laid down in the Commission’s Communication [COM(2004) 499 
final] of 14 July suggests not only price cuts by one third of the current institutional price but also quota cuts by 16 % of the current quota level. Such a combination of price and quota cuts will allow 
the Community to reach a sustainable balance on th e EU sugar market. Such a change is, however, 
not motivated by existing WTO requirements with  which the Community is in full compliance. 
 Notwithstanding any particular outcome of the proposed reform in the EU sugar sector, as 
outlined in the above-mentioned Communication, the EU will respect in the sugar sector, as in all 
other agricultural sectors, its commitments re garding domestic support a nd export subsidies. 
 
Q23. The Single Farm Payment is a key featu re of the CAP reform. It is due to be fully 
implemented by Member States until 31 December 2006. 
a) What is the current status of the Member St ates decisions in relatio n to the transitional 
period?  
 
A: Where specific agricultural conditions so wa rrant, Member States could decide, by August 
2004, to apply the single payment scheme after a tr ansitional period which shall expire either on 31 
December 2005 or on 31 December 2006. 
According to Member States’ notifications, out of the former EU-15, ten Member States will implement the single payment scheme from January  2005 onwards and five Member States from 2006 
onwards. 
 
b) In document http://europa.eu.int/sc adplus/leg/en/lvb/111089.htm, the Commission 
indicates that during the transition period Memb er States "will apply a direct payment system in 
compliance with the EU´s compe tition rules and international obligations". What will be the 
instruments in place to ensure that the nationa l payments will not go beyond EC´s commitment 
levels?  
 A: Title V of Council Regulation (EC) No 1782/2003 establishing common rules for direct 
support schemes under the common agricultural policy
2 lays down transitional rules.  During the 
transition period Member States who decided to pos tpone the implementation of the single payment 
scheme go on implementing the corresponding current ai d schemes, as adjusted to take account of 
changes decided under the 2003 CAP.  As it is current ly the case, these aid schemes fully comply with 
the corresponding WTO discipline on domestic support (generally blue box). Expenditure for direct 
payments is subject to various ceilings, be it unde r the single payment scheme or under the other aid 
schemes.  
c) From document http://europa.eu.int/scadpl us/leg/en/lvb/111089.htm, it appears that there 
are various exceptions from the single farm  payment: regional implementation, partial 
implementation and optional exclusion, thus, creating large differences among Member States on 
the way they are going to implement the Single Farm Payment. How does the Commission intend 
to implement these various mechanisms so as  to ensure compliance to EC´s international 
obligations? 
 A: See reply to question d) below. 
 
                                                     
 
2 Official Journal of the European Union  L 270 of 21 October 2003 WT/TPR/M/136/Add.2 
Page 41 
 
 
 d)  Is there any mechanism of notification to  the Commission of payments made at national 
level? Are these payments included in the calcula tion of payments made under amber, blue and 
green boxes? In cases where natio nal government payments go beyo nd agreed levels, are they 
deducted from the EC’s budget? 
 A: Options available to Member States in th e framework of the single payment scheme must 
comply with detailed regulatory provisions, including  notification to the Commission, and are subject 
to close monitoring by the Commission. In additio n, Member States must respect clear budgetary 
limits. In particular, a national ceiling has been  fixed for the sum of the single payment scheme 
(Annex VIII of Council regula tion n° 1782/2003 and Annex VIIIA  of Council Regulation n° 
583/2004). If, in a given year, the sum of the refe rence amounts is higher than this national ceiling, 
the individual reference amounts will be reduced.  
e)  With regard to products and sectors included in the reform for which “coupled” payments 
are still allowed, the combination of “coupled” and “decoupled” payments may have an influence 
on farmer’s decisions, es pecially because high border protec tion still represents an incentive to 
keep producing. In those cases, “decoupled” direct  payments could not be considered as “less 
distorting” as long as payments linked to production remain. Is there any timetable established by the EU for the elimination of remaining “coupled” payments? 
 
A: The reformed CAP is an additional step in the reform process foreseen in Article 20 of the 
Agreement on Agriculture, since it considerably  reduces existing amber support, which is by 
definition coupled, as well as coupled payments under production-limiting programs (blue) and it 
introduces decoupled payments. The conditions and ti meframe to implement either coupled payments 
(amber or blue) or decoupled payments (gr een) are well defined in the EU Regulations. 
 Green box payments have by definition no or at most minimal trade-distorting effects on 
production. Blue box payments are allowed und er production-limiting programs. The different 
support measures target different objectives and resp ect the criteria set out by the Agreement on 
Agriculture. The different types of support can th erefore not be cumulated per commodity and should 
be consider separately, in agre ement with both the letter and the spirit of the WTO Agreement on 
Agriculture. 
 
f) Commissioner Franz Fischler has sent letters  to Ministers of Agriculture of the member 
states concerning the intention of some of them to  make large use of exceptions — such as regional 
implementation — and the impact that this could have on the expected results of the CAP reform. Regional implementation may distort the dist ribution of payments among sectors and makes 
difficult to check compliance with EC rules and wi th international commitments. Are there specific 
disciplines for the use of that exceptio n and ways to monitoring its impacts? 
 
A: Except in the limited cases of partial implementation, support under the single payment 
scheme will be decoupled in accordance with Annex 2 of the Agreement on Agriculture. Therefore, 
support will generally be non-commodity specific, be it under the general implementation scheme or 
under the regional option. As par tial implementation, re gional implementation of the single payment 
scheme is subject to detailed notification and monitoring rules. The Commission will submit reports to the EU Council of Ministers on the consequences of Member States’ choices, including for regional implementation.   
Q24. The CAP reform places emphasis on the so-called second pillar — rural development — 
which covers measures regarding agri-enviro nmental issues, early retirement schemes, 
afforestation and payments to assist  farmers in least-favored areas,  as well as additional measures 
such as investment, training, promotion and conversion of agriculture are also envisaged WT/TPR/M/136/Add.2 
Page 42  
 
(paragraph 12 of report WT/TPRS/S/136). These actions will be co-financed by Member States. 
How will the EC ensure compliance of such activities by Member States with the notion that rural 
development measures should be "no or at most minimally trade-distorting", in accordance with 
paragraph 1 of Annex 2 of the Agreement on Agriculture? 
 A: The rural development measures mentioned in  the question are not new. They have been 
implemented for more than ten years and notified to the WTO as support falling under Annex 2 of the 
Agreement on Agriculture. They have been co-financed  in the past and this co-financing occurred and 
will occur under strict rules.  Q25. The EU enlargement will bring under the CAP additional four million farmers. Paragraph 
28 of the report WT/TPR/S/136 states that to the C-10 countries the mechanisms of financial discipline and modulation will not be applicable un til 2013. In the absence of financial discipline 
mechanisms, how does the EC expect that its level of  spending will abide by its commitments at the 
WTO, particularly in light of substantial cuts in  trade-distorting support deriving from the July 
package?  
A: In October 2002, EU Heads of States and Governments agreed on a new ceiling for  EU-25 expenditure on market and direct payments over the years 2007 to 2013. The mechanism of financial 
discipline ensures that this ceiling is respected.  Financial discipline and modulation do not apply to 
the New Member States as long as their level of dir ect payments does not reach to common level. If 
the financial discipline mechanism needs to be activated before, it will apply to direct payments 
granted to farmers in the former EU-15. The refo rmed CAP complies with th e framework agreed in 
the July package.  
Q26. Being the world´s leading trader (paragraph 10, Chapter IV, WT/TPR/S/136) of 
agricultural products, the EC occupies the highest rank in terms of support despite recent steps to 
reduce its farmers´ over-reliance on subsidies. As  a consequence, it is not by accident that the 
highest rate of self-sufficiency of the EC is fo und among the more subsidized commodities (dairy 
products and sugar) and that the individual commodities that respond for a substantial share of world trade (wine, pig-meat, cheese, milk powd er and sugar) also benef it from export subsidies 
(paragraph 10, passim). In market access, despite low average tariffs, high tariffs and TRQs are an 
important feature of the EC´s tariff structure. Add itionally, the tariff lines that concentrate most of 
the trade have TRQ commitments (38% of the EC´s  production, according to the World Bank). 
They also count with the Special Safeguard Mechan ism, and most tariffs are expressed in non-ad 
valorem terms. All these measures, which to a large extent are redundant, represent a bias against 
imports. In agriculture negotiations, the EC claims  that these commodities, particularly those that 
compete with domestic production, are "sensitiv e". Despite two CAP reforms, these products — 
which in the past were largely subject to quantita tive restrictions — continue to be so considered. 
a) As a measure to expedite the long-term reform process, does the EC consider the abolition 
and/or expansion of the TRQs that show permanent underfill?  
 
A: The question of the improvement of the TRQ management has to be addressed in the 
framework of the DDA negotiations. 
 
b) What measures can the EC envisage in order to simplify its TRQ administration procedures?  
 A: Same answer as for a). 
 
  WT/TPR/M/136/Add.2 
Page 43 
 
 
 c) How C-10 imports will be taken into account  in calculating the amount of TRQs after 
enlargement? 
 
A: The EC is currently adressing this matter in the context of the negotiations launched pursuant 
to Article XXIV.6 (GATT). During the  previous  enlargement the following approach was applied.  
TRQs resulting from the EC15 schedule and from the schedules of NMS are consolidated through a 
process of netting-in and netting-out, based on trade statistics.  The NMS TRQ volume is split within the tariff lines according to the trade share. Since data 
concerning the actual inside quota imports is not c onsistently available, netting-in of TRQs is 
calculated by taking into account the effective im ports to each NMS from WTO members within the 
tariff lines that are covered by a WTO tariff quota. 
The individual trade shares of WTO countries and EC24 are calculated separately in order to do the netting-out.  
Q27. EC´s resistance to open up its markets is not limited to WTO negotiations, as liberalization 
of agricultural products continues to be lim ited in regional trade agreements. How does the EC 
expect to carry out free trade agreements with de veloping countries in view of the fact that its 
difficulties to liberalize agricultural trade will hinder the attainment of the benchmark of 
"substantial part of the trade"? 
 
A: The EC is already widely opened to im ports of agricultural products from developing 
countries. A significant share of trade in agricultu ral products from developi ng countries already takes 
place at low or zero duties, in particular in the framework of ACP agreements or GSP, including EBA 
but also on an MFN basis for a number of products. For some countries, this already represents a significant part of the trade. This is notably th e case for non sensitive agricu ltural products such as 
coffee, cocoa or cotton. When it comes to sensitiv e products, the EU has already made substantial 
concessions notably to least developed countries.  The EU wishes other developed or advanced 
developing countries could follow the EU example.  The EC has negotiated several FTAs, in whic h it has also liberalized trade agricultural 
products  following the WTO rules (s ubstantially all trade); these agre ements are asymmetrical in the 
sense that our partners have liberalized a lower part of their imports.   Concerning the discussions for an Association agreement with Mercosur (of which Brazil is 
part ) the EC is following an even more ambiti ous approach, offering liberalization of 99% of our 
imports of agricultural products; surprisingl y enough Mercosur has presented a quite poor 
liberalization offer, covering  67 % of their impor ts in a very long time frame (for the remaining 
agricultural products Mercosur offe rs a reduction of 20% of their duties). This is more surprising 
given that the Mercosur imports represent only 4% of the total trade between the parties on 
agriculture. 
 Following this question in the TPRM exercise, we  hope that Mercosur w ill be able to improve 
their offer in our bi-regional negotiations, which w ould facilitate the conclusion of the negotiations.   
 
IX) SPS
 
 
Q28. In accordance to document WT/TPR/S/136,  Chapter III (Trade Policies and Practices by 
Measure), Paragraph 79, "Five ge neral principles are laid down by Regulation (EC) No. 178/2002 
for the EC's food safety regime: (i) a high level of food safety at all stages of the food chain, from 
primary production to the consumer; (ii) risk anal ysis as a fundamental component of food safety 
policy; (iii) full responsibility of operators for the safety of products they import, produce, process, 
place on the market or distribute; (iv) traceability of products at all stages of the food chain; and (v) 
entitlement of citizens to clear and accurate inform ation from public authorities (...) Furthermore, 
the regulation allows for risk management actions not only based on scientific assessment, but also WT/TPR/M/136/Add.2 
Page 44  
 
on other factors "legitimate" to the matter under consideration. This provision has attracted some 
criticism, however, as the definition of "other factors" is not clearly defined". Under this 
regulation, what parameters for risk management ac tions based on "other factors" can be expected 
to be used?  
A: The European Commission in his risk ma nagement proposal takes into account Codex 
standards, recommendations and guidelines as r ecommended by the SPS Agreement. Concerning 
other factors see “ Procedural manual of the Codex Alimentarius Commission , 13 Ed. pag.181-183 
“Statements of principle concerning the role of science in the Codex decision-making process and the 
extent to which other factors
 are taken into account ” adopted in the 21st Session of the Codex 
Commission (1995).  Q29. Paragraph 81, Chapter III (Trade Policies and Practices by Measure) of the Secretariat Report, affirms that "Various Community-wide le gislation has been adopted, in the area of 
sanitary and phytosanitary standards, on, inter alia, animal feeding stuff, animal health conditions, 
and plant health (...) Some of these regulations  have been the subject of several criticisms from 
third countries, including that they are much stri cter than international regulations (e.g. Codex 
Alimentarius and OIE), and there are high administrative costs in meeting them". As some of the 
regulations are considered much stricter than in ternational ones, what countries and products will 
be subject to these stricter regulations? Which criteria will be used to select products and countries? 
 
A: In the two year object of this review (2002 & 2003) the EC submitted 119 notifications to the 
WTO Agreement on SPS measures and has disseminated the notified texts to long list of WTO members prior to any request; Brazil has two addr esses on this list. The requested information on 
products and affected countries ca be found on the notifications (See annex I) and corresponding full 
text. In determining the appropria te level of sanitary or phytosanitary protection, the EC applies 
criteria set by Article 5(1) to 5(8) of the SPS Agreement.  
Q30. Still according to Paragraph 81 of Chapter III  of the Secretariat Report, the EC has been 
criticized by third countries for implementing SPS measures that "are much stricter than 
international regulations (e.g. Codex Alimentarius and OIE)". One example of  this practice is the 
proposed regulation that revises Maximum Residue Levels (MRLs) for pesticides on animal and 
plant products, notified to the WTO SPS Committee as G/SPS/N/EEC/196. The proposed regulation will revoke the authorization for 400 acti ve principles for which the MRLs will be set at 
the determination level (0,01mg/kg), regardless the existence of a different MRL defined by the 
Codex Alimentarius. The EC has also indicated that  these substances are removed from the market 
for economic rather than safety reasons. Could the EC please explain how this kind of measure is 
consistent with the WTO SPS Agreement, if: a) there is not "sufficient scientific evidence"  supporting the new MRLs (Article 2.2 of the 
WTO SPS Agreement); b) the measure is taken on economic rather than safety grounds; and 
c) there is not a risk assessment appropriate to th e circumstances, as required by Article 5.1 of 
the WTO SPS Agreement. 
 
A: In the EC, all CODEX’ MRL’s for PPP are ma intained unless new data indicates they are 
potentially dangerous what is in compliance with  Article 2.2 of the SPS Agreement and no measures 
are taken (sic. b above): “ on economic rather than safety grounds ”; all EC SPS related measures 
comply with the SPS Agreement.   The EC insist on this and, furthe rmore on that is fully transparent
 on its MRL policy and do 
not discriminat e against third countries producers.  WT/TPR/M/136/Add.2 
Page 45 
 
 
  As a way of example, in notice G/SPS/N/EEC/196 (11 April 2003) the EC announced a 
proposal for a Regulation of the European Parliame nt and of the Council on maximum residue levels 
of pesticides in products of plant and animal origin whose key points are:   To facilitate trade
. The proposal simplifies the existing legislation by unifying in a single text 
the four existing basic Council Directives on MRLs  for Plant Protection Products (PPP) namely:  
• Council Directive 76/895/EEC of 23 November 1976, on the fixing of maximum levels for 
pesticide residues in and on fruit and vegetables. (O. J. L 340, 09/12/1976 pp.:26-31) 
• Council Directive 86/362/EEC of 24 July 1986 on the fixing of maximum levels for pesticide 
residues in and on cereals (O. J. L 221, 07/08/1986 pp.:37 -42) 
• Council Directive 86/363/EEC of 24 July 1986 on the fixing of maximum levels for pesticide 
residues in and on foodstuffs of animal origin (O. J. L221, 07/08/1986 pp.:43 -47) 
• Council Directive 90/642/EEC of 27 November  1990 on the fixing of maximum levels for 
pesticide residues in and on certain  products of plant origin, incl uding fruit and vegetables (O. J. L 
350, 14/12/1990 pp.:71-79). 
 The consequence will be that all MRL’s will become harmonized through all member States 
of the European Community after a transitional period, and will thenceforth only be set at the 
European Community level. In all cases where a particular PPP is not authorized  on a commodity or 
when no data are available  to demonstrate that its residues do not endanger consumer health, no 
residues may be permitted on this commodity at levels higher than 0. 01 mg/kg which is an 
enforceable default for zero. However, import tolera nce can be applied for. Exceptions will be made 
for substances where a level of 0.01 mg/kg is not safe for the consumer by setting MRLs at a lower 
level.  To ensure control:
 On a pesticide there is an active ingred ient that is effective against a target 
pest that usually is the only component of the fo rmulation listed on its label, but other active or 
inactive isomers of this active, contaminants and impurities are also present which are too responsible 
for product hazards; as a way of example, Dioxin and DDT are contaminants which have not been 
purposefully added to pesticide formulae but are a function of the “production process”. In view of 
this and to ensure enforcement , the EC national governments require data concerning the synthesis 
process, the ratio between the active molecule and its isomers, and also the impurities that may be 
present. Furthermore, to be able to ensure saf ety for any imported product, the Health control 
Authorities must know the identity of the molecule , impurities, the marker residues and the maximum 
tolerance for it.  To clarify third Country’ MRL authorizations
: Any third country (including Brazil) willing to 
obtaining MRL’ for combinations drug and plants  products, may submit data to the EC to ensuring 
that each and every intended use of a crop prot ection product pose no unacceptable risks to humans 
and the environment. These data should include e sufficient information to ensure control3 by national 
Authorities. (see point 2 above)  
 
Annex to Answer to Q 30  
Notifications to the WTO Agreement on SPS Measures in the period 2002 and 2003. 
 
• G/SPS/N/EEC/147 (7 Jan. 2002) SANCO/4538/2001 Rev.3 : Draft Commission Decision 
laying down special conditions on the import from thir d countries of star anise star anise Emergency 
Measures. (SANCO/D02) 
• G/SPS/N/EEC/148 (11 Jan.2002) SANCO/3662/01 rev.4 Provisional MRL for existing active 
substances Bentazone & Pyridate. Draft Commissi on Directive amending the Annexes to Council 
Directives 86/362/EEC, 86/363/EEC and 90/642/EEC on th e fixing of maximum levels for pesticide 
                                                      
3 Molecule identification, ma in product isomers, impurities, method of analysis etc… WT/TPR/M/136/Add.2 
Page 46  
 
residues in and on cereals, foodstuffs of animal orig in and certain products of plant origin, including 
fruit and vegetables (SANCO/3662/01) (SANCO E01) 
• G/SPS/N/EEC/111 Add.2 (14 February 2002) Informs of  that the validity period of the animal 
health certificate established by Commissi on Decision 2001/393/EC notified under document 
G/SPS/N/EEC/111 (8 Feb. 2001) is extended from five to 15 days to take into account delivery days 
due to transport difficulties (SANCO/E02) 
• G/SPS/N/EEC/149 (14 Feb. 2002) COM(2001)425 final "Proposal for a Regulation of the 
European Parliament and of the Council on gene tically modified food and feed" (40 pages). 
(SANCO/D01) 
• G/SPS/N/EEC/150 (14 Feb. 2002) COM(2001)182 ‘Proposal for a Regulation of the 
European Parliament and of the Council concer ning the labelling and traceability of genetically 
modified organisms and traceability of food and feed  products produced from genetically modified 
organisms and amending Directive 2001/18/EC’ (8 pages). (ENV/02) 
• G/SPS/N/EEC/151 (14 Feb 2002) SANCO/3678/ 01 Draft Commission Regulation amending 
Regulation (EC) N° 466/2001 of 8 March 2001 setting ma ximum levels for certain contaminants in 
foodstuffs (SANCO/D03) 
• G/SPS/N/EEC/152 (14 Feb 2002) SANCO/2001/3828/Rev. 4  ‘Draft Commission Decision 
laying down public health requirements for fresh  meat and fresh poultry meat imported from third 
countries; Commission Decision 2001/471/EC and amending Decision 94/984.’ (SANCO /D02) 
• G/SPS/N/EEC/153 (14 Feb 2002) COM(2001) 433 final (2001/0199 (COD)) Proposal for a 
Directive of the European Parliament and of the Council amending Directive 2000/13/EC regarding 
the ingredients present in foodstuffs; (SANCO/D04) 
• G/SPS/N/EEC/154 (14 Feb 2002) SANCO/3654/01 Draft Commission Directive amending 
the Annexes to Council Directives 86/362/EEC,  86/363/EEC and 90/642/EEC on the fixing of 
maximum levels for pesticide residues in and on ce reals, foodstuffs of animal origin and certain 
products of plant origin, including fruit and vegetables (SANCO/E01) 
• G/SPS/N/EEC/155 (14 Feb 2002) (Emergency measures) : Commission Decision 2002/69/EC 
of 30 Jan. 2002 concerning certain protective measures with regard to  the products of animal origin 
imported from China (Official Journal of the Euro pean Communities No L30 of 31 Jan. 2002, pp.50-51) 
(SANCO/E03) 
• G/SPS/N/EEC/156. (2 April 2002) Doc. SANCO/2891/2001 rev 2 raft Commission 
Regulation establishing deadlines for the submission of information for the evaluation of chemically defined flavouring substances used in or on foodstuffs (SANCO/D03) 
• G/SPS/N/EEC/133 Rev.1 (27 March 2002) SANCO/4372/2001 Rev.9, Commission 
Regulation amending Regulation (EC)  No 999/2001 of the European Parliament and the Council as 
regards specified risk material and epidem ic-surveillance for transmissible spongiform 
encephalopathies and amending Regulation (EC) No  1326/2001 as regards animal feeding and the 
placing on the market of ovine and caprine animals and products thereof (SANCO/D02) 
• G/SPS/N/EEC/108 Ad.1 (27 March 2002): S ANCO/2001/4809 Rev.4 amending Council 
Decision 2000/766/EEC (notified as G/SPS/N/EEC/108) concerning certain protection measures with 
regard to transmissible spongiform encephalopathi es and the feeding of animal protein (Official 
Journal of the European Communities, Number  L306 of 7 Dec. 2000, pages 32-33) and Council 
Decision 2001/9/EC, with regards to Transmissible Spongiform Encephalopathy and the feeding of animal proteins (not notified to the SPS Committee).(SANCO/D02) 
• G/SPS/N/EEC/157 (2 April 2002) ): SANC O/4030/01 Rev.9 "Commission Regulation 
establishing a list of feed materials whose circulatio n or use for animal nutrition purposes is restricted 
or prohibited and amending Commission  Decision 91/516/EEC" (SANCO/D01) 
• G/SPS/N/EEC/158 (2 April 2002) SANCO/516/2002 Rev. 4; Draft Commission decision 
amending Commission Decision 1999/283/EC laying down the animal health conditions and 
veterinary certification for imports of fresh meat from certain African countries and in particular as 
regards Botswana, and amending Commission Decisi on 2000/585/EC laying down the animal health WT/TPR/M/136/Add.2 
Page 47 
 
 
 conditions and veterinary certifica tion for imports of wild and farm ed game meat and rabbit meat 
from third countries (SANCO/E02) 
• G/SPS/N/EEC/159 (2 April 2002) SANCO/4369/01 Rev.5 Draft Commission directive on the 
labelling of foodstuffs containing quinine, and of foodstuffs containing caffeine (SANCO/D04) 
• G/SPS/N/EEC/149 Ad.1 (2 April 2002) The final date for comments on this notification is 
extended to 30 March 2002  
• G/SPS/N/EEC/150 Ad .1 (2 April 2002) The final date for comments on this notification is 
extended to 30 March 2002  
• G/SPS/N/EEC/156 Ad.1 (2 April 2002) The final date for comments on this notification is 
extended to 12 April 2002  
• G/SPS/N/EEC/160 (8 April 2002) SANCO/3865/01 rev4 Draft Commission Directive 
amending the Annexes to Council Directives 86/362 /EEC, 86/363/EEC and 90/642/EEC on the fixing 
of maximum levels for pesticide residues (dimet hoate and oxydemeton-methyl) in and on cereals, 
foodstuffs of animal origin and certain products  of plant origin, including fruit and vegetables 
(SANCO/E01) 
• G/SPS/N/EEC/161 (8 April 2002) SANCO/228/02 rev2 Draft Commission Directive 
amending the Annexes to Council Directives 86/362 /EEC and 90/642/EEC on the fixing of maximum 
levels for pesticide residues (metsulphuron-methyl )in and on cereals and certain products of plant 
origin, including fruit and vegetables (SANCO/E01) 
• G/SPS/N/EEC/162 (8 April 2002) SANCO/2505/01 rev6, Draft Commission Directive 
establishing Community methods of sampling for the official control of pesticide residues in and on 
products of plant and animal origin and repealing Directive 79/700/EEC (SANCO/E01) 
• G/SPS/N/EEC/163 (8 April 2002) Draft Commission Directive amending the Annexes to 
Council Directives76/895, 86/362/EEC, 86/363/EE C and 90/642/EEC on the fixing of maximum 
levels for pesticide residues in and on cereals, foodstu ffs of animal origin and certain products of plant 
origin, including fruit and vegetables (SANCO/2504/01 rev6, (SANCO/E01) 
• G/SPS/N/EEC/164 EMERG (12 April 2002) SANCO/362/2002 Commission Decision 
suspending the placing on the market and the import of  jelly confectionery containing the food additive 
E 425 konjac (SANCO/D03) 
• G/SPS/N/EEC/165 (18 April 2002) COM(2002)153 fi nal “Proposal for a Regulation of the 
European Parliament and of the Council on additives for use in animal nutrition” 
• G/SPS/N/EEC/166 (18 April 2002) SANCO/844/2002 rev2, “Draft Commission Directive 
amending the Annexes to Council Directives 86/362 /EEC, 86/363/EEC and 90/642/EEC on the fixing 
of maximum levels for pesticide residues (2,4 D, triasulfuron and thifensulfuron- methyl)in and on 
cereals, foodstuffs of animal origin and certa in products of plant origin, including fruit and 
vegetables”.  
• G/SPS/N/EEC/160 Corr.1 (1 July 2002): SANCO/3865/01 rev5 11 pages “Draft Commission 
Directive amending the Annexes to Council Directives 86/362/EEC, 86/363/EEC and 90/642/EEC on the fixing of maximum levels for pesticide r esidues (dimethoate, formothion, nitrofen and 
oxydemeton-methyl) in and on cereals, foodstuffs of  animal origin and certain products of plant 
origin, including fruit and vegetables. (SANCO/E01) 
• G/SPS/N/EEC/167 (3 July 2002) SANCO/2001/0998-rev1 Draft Commission Directive 
relating to plastic materials and articles intended to  come into contact with foodstuffs (legislative 
consolidation of Directive 90/128/EEC and its amendments , 61 pages. (SANCO/D03) 
• G/SPS/N/EEC/168 (3 July 2002) SANCO/779/2002, Draft Commission Directive amending 
Commission directive 96/77/EC laying down specifi c purity criteria on food additives other than 
colours and sweeteners. 60 pages. (SANCO/D03)  
• G/SPS/N/EEC/169 (3 July 2002) SANCO/1040/2 002 rev.1, Draft Commission Directive 
amending the Annex to Council Directive 90/642/EEC on the fixing of maximum levels for pesticide WT/TPR/M/136/Add.2 
Page 48  
 
residues (azoxystrobin)in and on certain products of plant origin, including fruit and vegetables 
respectively. 9 pages , in English (SANCO/E01) 
• G/SPS/N/EEC/157/Corr.1 (23 July 2002) As a consequence of the ongoing discussion 
concerning the legislative proposal notified in G/SPS/N/EEC/103
4, (24 Nov. 2000), also covering 
these products the Commission modifies the dates of a doption, entry into force and application of the 
draft notified in G/SPS/N/EEC/157 (2 April 2002). SANCO/D01   
• G/SPS/N/EEC/94/Rev.1 (23 July 2002) COM(2002) 377 of 11 July 2002 "Proposal (presented 
by the Commission) for a Regulation of the European Parliament and of the Council laying down specific rules for the organisation of official contro ls on products of animal origin intended for human 
consumption" . SANCO/D02. 
• G/SPS/N/EEC/170 (25 July 2002) SANCO/4366/ 2001-Rev.6 Draft Pr oposal for a 
Commission Decision amending Council Directiv e 92/118/EEC as regards requirements for collagen 
(14 pages). SANCO/D02 
• G/SPS/N/EEC/171 EMRG (25 July 2002) Commission Decision 2002/537/EC of 2 July 2002 
concerning protection measures relating to Newcastle disease in Australia
5 (OJ L173, 3/7/02 pp.33-
38). SANCO/E02   
• G/SPS/N/EEC/172 EMRG (25 July 2002) SANC O/10332/2002-Rev. 2 Pr oposal for a Draft 
Commission decision concerning protective measu res relating to avian influenza in Chile. 
SANCO/E02   
• G/SPS/N/EEC/167 Ad.1 (18 Sept. 2002) “Consolidated version of Commission Directive 
90/128/EEC of 23 Feb. 1990 relating to plastic materials and articles intended to come into contact 
with foodstuffs. (OJ L75 21/3/90 p.19 - 40). 
• G/SPS/N/EEC/173 (1 Oct. 2002) SANCO/10262/2002 – Rev.2 – Draft Commission Decision 
amending Decision 2001/751/EC as regards imports of  live ratites and hatching  eggs from Botswana 
(5 pages). SANCO/E02  
• G/SPS/N/EEC/174 (1 Oct. 2002) SANCO/10429/20 02 -Rev.2 (Draft Commission Decision 
amending Decision 2002/607/EC concerning protection measures relating to avian influenza in Chile. 
SANCO/E02  
• G/SPS/N/EEC/175 (1 Oct. 2002) SANCO/2002/2051 Proposal for a Directive of the 
European Parliament and of the Council amending Di rective 95/2/EC as regards the conditions of use 
for a food additive E 425 konjac . SANCO/D03   
• G/SPS/N/EEC/176 (2 Oct. 2002): Document COM(2002) 400 final – 2002/0163 (COD) 
Proposal for a European Parliament and Council Re gulation on smoke flavouri ngs used or intended 
for use in or on food. SANCO/D02  
• G/SPS/N/EEC/177 EMRG (9 Oct. 2002) Commission Decision 2002/757/EC of 19 
September 2002 on provisional emergency phytosan itary measures to prevent the introduction into 
and the spread within the Community of Phytophtho ra ramorum Werres, De Cock &Man in ’t Veld 
sp. nov. (OJ L252, 20.9.2002, pp. 37-39) SANCO/E01   
• G/SPS/N/EEC/178 (15 Oct. 2002) Document  SANCO/ 2074/2002 rev 3 Draft Commission 
Directive amending Directive 91/321/EEC on infa nt formulae and follow-on formulae (7 p.) 
SANCO/D03  &  
• G/SPS/N/EEC/179 (15 Oct. 2002) SANCO/ 2075/2002 rev 3 Draft Commission Directive 
amending Directive 96/5/EC on proc essed cereal-based foods and baby foods for infants and young 
children SANCO/D03. 
• G/SPS/N/EEC/103 Add.2 (23 Oct. 2002) The proposal notified in document 
G/SPS/N/EEC/103 (24 November 2000), i.e. Docume nt COM(2000)574 final has been adopted as 
"Regulation (EC) No 1774/2002 of the European Parliament and of the Council of 3 October 2002 
                                                      
4 Comment period extended to 28 February 2001 by G/SPS/N/EEC/103/Add.1, dated 7 February 2001. 
5 Unadvertedly not notified.  WT/TPR/M/136/Add.2 
Page 49 
 
 
 laying down health rules concerning animal by-pro ducts not intended for human consumption", O. J. 
No L273 of 10 October 2002, pages 1 to 95. (Initiative of EC Notification Authority) 
• G/SPS/N/EEC/180 EMRG (20 Dec. 2002) SANCO/00/ 1986 Rev.9 Draft Commission 
Directive establishing the list, concentration limits and labelling requirements for the constituents of 
natural mineral waters and the c onditions for using ozone-enriched ai r for the treatment of natural 
mineral waters and spri ng waters. (SANCO/D04) 
• G/SPS/N/EEC/181 EMRG (20 Dec. 2002) Commission Decision of 14 November 2002 
amending Decision 96/301/EC by renewing the Memb er States' authorization to take emergency 
measures against the dissemination of Pseudomona s solanacearum (Smith) Smith as regards Egypt 
(Official Journal of the European Communities L 312 of 15 November 2002, page 28). SANCO/E01  
• G/SPS/N/EEC/182 (8 January 2003) SANCO/ 10469/2002 Rev.2 Draft Commission Directive 
amending the Annexes to Council Directives 86/ 362/EEC, 86/363/EEC and 90/642/EEC as regards the 
fixing of maximum levels for certain pesticide residu es in and on cereals, foods tuffs of animal origin 
and certain products of plant origin, incl uding fruit and vegetables (SANCO/E01)  
• G/SPS/N/EEC/183 (8 January 2003) SANCO/ 10538/2002 Rev.2, Draft Commission Directive 
amending Council Directives 86/362/EEC, 90/642/EEC in respect of maximum residue levels for 
hexaconazole, clofentezine, myclobut anyl and prochloraz (SANCO/E01) 
• G/SPS/N/EEC/184 (8 January 2003) SANCO/ 3926/2002 Rev.2 Draft Commission Regulation 
amending Regulation (EC) No.999/2001 of the European  Parliament and of the Council as regards the 
import of live ovine and cap rine animals. (SANCO/D02) 
• G/SPS/N/EEC/185 (8 January 2003) Pr oposal for a Directive of the European Parliament and 
of the Council amending Directive 95/2/EC on food a dditives other than colours and sweeteners (Doc 
COM /2002) 662 final – 2002/0274 (COD) 24 pages). (SANCO/D02) 
• G/SPS/N/EEC/098 Ad.1 (16 January 2003) Final Rule . Legislative proposal notified in 
G/SPS/N/EEC/98 (13/10/2000) has been adopt ed and published as Commission Decision 
2002/657/EC of 12 August 2002 implementing C ouncil Directive 96/23/EC concerning the 
performance of analytical methods and the inte rpretation of result (OJ L221 17/08/02, pp.: 8-36). 
(SANCO/D02 ) 
• G/SPS/N/EEC/186 (16 January 2003) SANCO/3 955/2002  Draft Commission decision 
amending Commission Decision 2002/657/EC of 12  August 2002 implementing Council Directive 
96/23/EC concerning the performance of analytical me thods and the interpretation of result, as regards 
the setting of minimum required pe rformance limits (MRPLs) for cert ain residues in food of animal 
origin (SANCO/D02 ) 
• G/SPS/N/EEC/187 (16 January 2003) Consolidat ed versions. Rule European Commission 
Notice No 2002/C329/01 "List of the authorised additi ves in feedingstuffs published in application of 
Article 9t (b) of Council Directive 70/524/EEC c oncerning additives in feedingstuffs".  (Official 
Journal Series C.  Vol 45 No 329, 31 December 2002, pp 1–142) SANCO/D01) 
• G/SPS/N/EEC/188 (6 February 2003) Council Directive 2002/89/EC of 28 November 2002 
amending Directive 2000/29/EC on protective measur es against the introduction into the Community 
of organisms harmful to plants or plant products and against th eir spread within the Community 
(SANCO/E01 ) 
• G/SPS/N/EEC/189 (6 February 2003) Commissi on Decision 2003/64/EC of 28 January 2003 
on provisional measures to prevent the introduction into and the spread within the Community of 
pepino mosaic virus as regards tomato plan ts, intended for planting (SANCO/E01) 
• G/SPS/N/EEC/094 Rev1 Ad.1 (11 February 2003)  Final Rule: Council Directive 2002/99/EC 
of 16 December 2002 laying down the animal he alth rules governing the production, processing, 
distribution and introduction of products of animal  origin for human consumption (Official Journal 
L18 of 23/01/2003 pp.:11-20) (SANCO/E02). 
• G/SPS/N/EEC/190 (03 March 2003) Live bovine, sw ine, ovine and caprine animals. Draft 
Commission Decision of - on Community health co nditions on imports of animals and fresh meat WT/TPR/M/136/Add.2 
Page 50  
 
including minced meat from third countries and amending Council Decision 79/542/EEC, and 
Commission Decisions 2000/572/EC and 2000/585/EC SANCO/10167/2002-Rev. 13 (SANCO/E02) 
• G/SPS/N/EEC/191 (03 March 2003) Foodstuff or f eedingstuff of animal or plant origin 
COM(2003) 52 final (2003/0030 (COD)) Proposal for a Regulation of the European Parliament and of the Council on official feed and food  controls (114 pages). (SANCO/D02 ) 
• G/SPS/N/EEC/192 (03 March 2003) Live bovine, ov ine and caprine animals Draft Regulation 
of the European Parliament and of the Council amending Regulation (EC) No 999/2001 as regards the 
extension of the period for transitional measures Doc.SANCO/3663/2002. (SANCO/D02) 
• G/SPS/N/EEC/193 (03 March 2003) Meat of bovine animals, sheep or goats Draft Proposal 
for a Commission Regulation amending Annexes III, X and XI to Regulation (EC) no 999/2001 of the 
European Parliament and of the Council as regards monitoring programmes, rapid tests and specified 
risk material. Doc.SANCO/3920/2002   (SANCO/D02) 
• G/SPS/N/EEC/194 (21 March 2003) Commission Directive amending the Annexes to 
Council Directives 76/895, 86/362/EEC, 86/363/EEC and 90/642/EEC as regards the fixing of 
maximum levels for certain pestic ide residues in and on cereals, foodstuffs of animal origin and 
certain products of plant origin, including fru it and vegetables.(SANCO/10022/2003 rev. 4) MRL is 
set at detection level for acephate, metalaxyl & parathion-methyl (SANCO/E01) 
• G/SPS/N/EEC/195 (21 March 2003) Commission Directive amending Council Directives 
86/362/EEC, 86/363/EEC and  90/642/EEC in respect  of maximum residue levels for chlormequat, 
fenamiphos, lambda-cyhalothrin, kresoxim-meth yl, azoxystrobin and mancozeb Document 
SANCO/10533/2002 (SANCO/E01) 
• G/SPS/N/EEC/191 Add.1 (07 April 2003) Foodstuff or  feedingstuff of animal or plant origin 
COM(2003) 52 final (2003/0030 (COD)) Proposal for a Regulation of the European Parliament and of the Council on official feed and food controls (114 pages) . Extension to comment period. 
(SANCO/D02) 
• G/SPS/N/EEC/196 (11 April 2003) COM(2003) 117  final;  2003/0052 (COD) “Proposal for a 
Regulation of the European Parliament and of the Council on maximum residue levels of pesticides in 
products of plant and animal origin.” (SANCO/E01) 
• G/SPS/N/EEC/149/Add.2 (11 April 2003) "Common position with a view to the adoption of 
Regulation of the European Parliament and of the Council on genetically modified food and feed". 
• G/SPS/N/EEC/150/Add.2  (11 April 2003) "Commo n position with a view to the adoption of 
a regulation of the European Parliament and of  the Council concerning the labelling and traceability 
of genetically modified organisms and traceab ility of food and feed products produced from 
genetically modified organisms a nd amending Directive 2001/18/EC". 
• G/SPS/N/EEC/197 (1/05/2003) SANCO/10078/2002 Rev. 8, Draft Commission Decision 
laying down the animal health conditions and certif ication requirements for imports of live molluscs, 
their eggs and gametes for furthe r growth, fattening, relaying, or human consumption. (SANCO/E02) 
• G/SPS/N/EEC/198 (1/05/2003) SANCO/10145/2002 Rev.9Draft Commission Decision 
laying down the animal health conditions and certific ation requirements for imports of live fish, their 
eggs and gametes intended for farming, and live fi sh of aquaculture origin and products thereof 
intended for immediate human consumption or fo r further processing before human consumption 
(SANCO/E02) 
• G/SPS/N/EEC/198/Corr.1 (09/05/2003) Live fish  - Corrigendum to CN headings (WTO 
error). 
• 
G/SPS/N/EEC/199 (09/05/2003) Host plants for Er winia amylovora (Burr.) Winsl. et al., the 
causal agent of fireblight Draft Commission Directive amending Council Directive 2000/29/EC on protective measures against the introduction into the Community of organisms harmful to plants or 
plant products and against their spread with in the Community (SANCO/316/02-Rev5, 10 pages). 
(SANCO E/1)  WT/TPR/M/136/Add.2 
Page 51 
 
 
 • G/SPS/N/EEC/149/Add.2/Corr.1 (20/05/2003) Genetically modified food and feed - 
Corrigendum The Commission anticipates that the EP' s 2nd reading is likely to be finalised by 
July 2003. (SANCO/D04). 
• G/SPS/N/EEC/150/Add.2/Corr.1 (20/05/2003) Food containing genetically modified 
organisms – Corrigendum The Commission anticipates that the EP's 2nd reading is likely to be finalised by July 2003(SANCO/D04). 
• G/SPS/N/EEC/103/Add.3 (28/05/2003) Animal by-products – Addendum In response to 
comments received from third countries, and with a vi ew to help them to fully comply with all its 
provisions, the Commission adopted recently Regu lation (EC) No.812/2003 of 12 May 2003 on 
transitional measures under Regulation (EC) No.1774/ 2002 of the European Parliament and of the 
Council as regards the importation and transit of certain products from third countries (Official 
Journal L117, 13 May 2003 pp.19-21) that set down a general "transitional period" for third countries 
lasting until 31 December 2003.  During this period,  the existing EU rules on imports continue to 
apply. (SANCO/D02) 
• G/SPS/N/EEC/200 (06/06/2003) Animal Fe edingstuffs (COM (2003) 180 (2003/0071 
(COD)) Proposal for a Regulation of the Europ ean Parliament and of the Council laying down 
requirements for feed hygiene (52 pages). (SANCO D/01) 
• G/SPS/N/EEC/201 (13/06/2003) Live animals and th eir meat and meat products, of bovine, 
ovine, caprine origin, and of aquatic invertebrates Draft Proposal for a Commission Regulation amending Regulation (EC) No 999/2001 of the Eur opean Parliament and of the Council as regards 
rules for importation of live animals and produc ts of animal origin.  (Doc. SANCO/2065/2003 
(SANCO E02) 
• G/SPS/N/EEC/202 (17/06/2003) Food additives  other than colours and sweeteners. 
SANCO/2118/2003 Draft Commission Directive amending Commission Directive 96/77/EC laying down specific purity criteria on food additives ot her than colours and sweeteners (SANCO D03) 
• G/SPS/N/EEC/203 (20/06/2003) Apple products  and food preparation containing apple 
SANCO/03139/2002 – Rev.1, Draft Commission Regul ation amending Regulation (EC) No 466/2001 
setting maximum levels for certain cont aminants in foodstuffs (SANCO D/03) 
• G/SPS/N/EEC/204 20/06/2003 Apple products and food preparation containing apple 
Analysis SANCO/3140/2002 Draft Commission Directive laying down the sampling methods and the methods of analysis for the official control of the levels of patulin in foodstuffs (SANCO D/03) 
• G/SPS/N/EEC/205 (23/06/2003) Emergency Measur es -  Fruits of Capsicum spp. Draft 
Commission Decision on emergency measures with regard  to adulteration by Sudan red 1 of hot chilli 
and hot chilli products (SANCO/2723/2003) SANCO D03) 
• G/SPS/N/EEC/206; 02/07/2003; - Cereals, foodstuffs of animal origin, fruits and vegetables :  
Draft Commission Directive amending the Annexes to Council Directives 86/362/EEC, 86/363/EEC and 90/642/EEC regarding the fixing of maximum le vels for certain pesticide residues in and on 
cereals, foodstuffs of animal origin  and certain products of plant orig in, including fruit and vegetables 
(SANCO/10018/2003 Rev 4) (SANCO/E01) 
• G/SPS/N/EEC/207; 09/07/2003; - Brazil nuts in shell . Draft Commission Decision on 
imposing special conditions on the import of Brazil nuts in shell originating in or consigned from 
Brazil (SANCO/0038/2003 – Rev.1) (SANCO D/03) 
• G/SPS/N/EEC/144/Add.1; 16/07/2003; - Breeding pigs, live poultry and turkeys, fresh 
poultry meat, hatching eggs and shell eggs – Addendum Common Po sition (EC) No.14/2003 of 20 
February 2003 adopted by the Council, acting in acco rdance with the procedure referred to in Article 
251 of the Treaty establishing the European Community, with a view to adopting a regulation of the 
European Parliament and of the Council on the cont rol of salmonella and other specified food-borne 
zoonotic agents (O.J. Series C, Number C90E , of 15.04.2003, pages 25 to 43). (SANCO/D02) 
• G/SPS/N/EEC/208; 25/07/2003; - Bees (Apis mellifera), hives, queens with or without 
attendants, and bee-keeping material.  SANCO/10399/2003 Rev.5 Draft Commission Decision WT/TPR/M/136/Add.2 
Page 52  
 
concerning the animal health conditions and certifi cate for imports of bees/hives, queens and their 
attendants from certain third countries and repea ling Commission Decision 2000/ 462/EC. (SANCO E/2)   
• G/SPS/N/EEC/209; 31/07/2003; - Maize grain : Aflatoxins :  SANCO/ 0061/2003 Rev.1 Draft 
Commission Regulation amending Regulation (EC) No.466/2001 as regards aflatoxins (SANCO D/03) 
• G/SPS/N/EEC/210; 31/07/2003; - Maize grain : aflatoxins Analysis: SANCO/ 0073/2003 
Rev.1 Draft Commission Directive amending Commis sion Directive 98/53/EC of 16 July 1998 laying 
down the sampling methods and the methods of analysis for the official control of the levels for certain 
contaminants (SANCO D/03) 
• G/SPS/N/EEC/211 (05/08/2003) - Canned food and/or beverages SANCO/1034/2002-1 rev.4 
Draft Commission Regulation amending Regulation (E C) N° 466/2001 as regards inorganic tin in 
foods. (SANCO D/03) 
• G/SPS/N/EEC/212 (22/08/2003) - Chemical ly defined flavouring substances. 
SANCO/2495/2003-rev.3 Draft Commission Decision amending Commission Decision 1999/217/EC 
adopting a register of flavouring substances used in or on foods); (SANCO/D2) 
• G/SPS/N/EEC/213 (04/09/2003) - All active substances used in biocidal products.  
SCB/03/03-Rev3 Draft Commission Regulation (EC) No …/... of (...) on the second phase of the 10-year work programme referred to in Article 16(2) of Directive 98/8/EC of the European Parliament 
and of the Council concerning the placing of bi ocidal products on the market, and amending 
Regulation (EC) No 1896/2000. (ENV C/3) 
• G/SPS/N/EEC/103/Add.4 (16/09/2003)  - Animal by-products - Addendum 
SANCO/2442/2003 R6 Draft Commission regulation am ending certain Annexes to Regulation (EC) 
No. 1774/2002 of the European Parliament and of  the Council, as regards the importation from third 
countries of animal by-products (document) (SANCO D2) 
• G/SPS/N/EEC/214 (25/09/2003) - Materials and articles in contact with food - Draft 
Commission Directive amending Directive 2002/16/EC on the use of certain epoxy derivatives in materials and articles intended to  come into contact with foodstuffs (SANCO/2003/960, 5 pages) 
(SANCO D/03)  
• G/SPS/N/EEC/103/Add.5 (30/09/2003) Draft Commission Decision on transitional sanitary 
and certification rules under Regulation (EC) No. 1774/2002 of the European Parliament and of the 
Council, as regards import from certain third count ries of photographic gelatine, which may contain 
bovine vertebral column and is therefore classifi ed as Category 1 material under that Regulation 
(document SANCO/3280/2003 R2), (SANCO D/02) 
• G/SPS/N/EEC/170/Add.1 (09/10/2003) Collage n for human consumption – Addendum 
SANCO/10459/2003-Rev.2 Draft Commission Decision amending Council Directive 92/118/EEC as 
regards requirements for collagen intended fo r human consumption and repealing Decision 
2003/42/EC (SANCO D/02) 
• G/SPS/N/EEC/215; 09/10/2003; Regenerate d cellulose film SANCO/2002/10055 Draft 
Commission Directive amending Directive 93/10/EEC relating to materials and articles made of regenerated cellulose film intended to come into contact with foodstuffs (SANCO D/03) 
• G/SPS/N/EEC/216; 09/10/2003; Amitraz and plant protection products containing amitraz. 
SANCO/10322/2003 Rev 2:  Draft Commission Decision Concerning the Non-inclusion of Amitraz 
as Active Substance in Annex I to Directive 91/414/ EEC and the Withdrawal of Authorisations for 
Plant Protection Products Containing this Active Substance (SANCO E/01) 
• G/SPS/N/EEC/217; 13/10/2003; Pesticides and agrochemicals SANCO/10300/2003 Rev 5 
Draft Commission Decision concerning the non-incl usion of certain active substances in Annex I to 
Council Directive 91/414/EEC and the withdrawal of  authorisations for plant protection products 
containing these substances  (SANCO E/01) 
• G/SPS/N/EEC/218; 13/10/2003; Plastic materi als and articles in contact with food 
SANCO/2003/949  Draft Commission Directive ame nding Directive 2002/72/EC relating to plastic 
materials and articles intended to come into  contact with foodstuffs  (SANCO D/03)  WT/TPR/M/136/Add.2 
Page 53 
 
 
 • G/SPS/N/EEC/219; 15/10/2003; Malachite green in fish from aquaculture 
SANCO/4163/2003.  Draft Commission decision amending Commission Decision 2002/657/EC of 12 August 2002 implementing Council Directive 96/23/EC  concerning the performance of analytical 
methods and the interpretation of results, as re gards the setting of minimum required performance 
limits (MRPLs) for certain residues in food of animal origin. (SANCO D/03 ) 
• G/SPS/N/EEC/102/Rev.1/Add.1; 23/10/2003; Live fa rm and aquaculture animals; meat and 
meat products – Addendum "Direc tive 2003/74/EC of the European Parliament and of the Council of 
22 September 2003 amending Council Directive 96/ 22/EC concerning the prohibition on the use in 
stockfarming of certain substances having a hormona l or thyrostatic action and of beta-agonists" 
(Official Journal of the EU, L262 of 14 October 2003, pp. 17-21).  
• G/SPS/N/EEC/208/Add.1; 27/10/2003; Bees a nd bee-keeping material - Addendum 
Document SANCO/10399/2003 Rev.6 Draft Commission Decision concerning the animal health conditions and certificate for imports of bees/hiv es, queens and their attendants from certain third 
countries and repealing Commission Decision 2000/462/EC (SANCO E/02 ). 
• G/SPS/N/EEC/220; 31/10/2003; Liquid oils and fa ts transported in bulk. SANCO/0073/2003 
Rev.1 Draft Commission Directive amending Commission Directive 98/53/EC of 16 July 1998 laying down the sampling methods and the methods of analys is for the official control of the levels for 
certain contaminants. (SANCO E/02) 
• G/SPS/N/EEC/103/Add.6; 11/11/2003; Animal by -products and products derived therefrom - 
Addendum a Draft proposal on transitional measure s under Regulation (EC) No 1774/2002 of  the 
European Parliament and of the Council, as regard s the import and transit of certain products from 
certain third countries (SANCO/4076/2003 R4) (SANCO D/02)  
• G/SPS/N/EEC/221; 11/11/2003; Wood and wood packaging material SANCO/ 1460/03 
Rev.12  Draft Commission Directive amending Anne xes II, III, IV and V to Council Directive 
2000/29/EC on protective measures against the introd uction into the Community of organisms harmful 
to plants or plant products and against thei r spread within the Community (SANCO E/1).  
• G/SPS/N/EEC/149/Add.3; 19/11/2003. Genetica lly modified food and feed - Addendum 
Regulation (EC) No 1829/2003 of the European Parliament and of the Council on genetically 
modified food and feed" (OJ, L268, 18 October 2003, pp.: 1-23).  
• G/SPS/N/EEC/150/Add.3; 19/11/2003; Food and feed products produced from genetically 
modified organisms – Addendum. Re gulation (EC) No 1830/2003 of the European Parliament and of 
the Council concerning the traceability and labelling of genetically modified organisms and the 
traceability of food and feed products produced fro m genetically modified organisms and amending 
Directive 2001/18/EC" (OJ L268, 18 October 2003, pp.: 24-28). 
• G/SPS/N/EEC/165/Add.1; 19/11/2003; Feed a dditives – Addendum. Regulation (EC) No 
1831/2003 of the European Parliament and of the Council on additives for use in animal nutrition" 
(OJ L268, 18 October 2003, pp.: 29-43). 
• G/SPS/N/EEC/219/Corr.1; 19/11/2003; Fish from aquaculture – Corrigendum (error in date 
of coming into force) 
• G/SPS/N/EEC/222; 19/11/2003; Baby foods SANCO/2002/1027 Rev 3  Draft Commission 
Regulation amending Regulation (EC) No 466/2001 as regards nitrate in foods for infants and young 
children (SANCO/D03) . 
• G/SPS/N/EEC/223 (2 December 2003 SANCO/0983/2002 Rev.5 Draft Commission 
Regulation amending Regulation (EC) No.466/2001 as regards aflatoxins and ochratoxin A in foods 
for infants and young children (SANCO/D03) . 
• G/SPS/N/EEC/224 (8 December 2003 SANCO/2003/4653, Draft Commission Directive 
amending Directive 2002/72/EC relating to plastic mate rials and articles intended to come into contact 
with foodstuffs (SANCO D/03)  
• G/SPS/N/EEC/225 (8 December 2003) SANC O/2492/2003 Draft Commission Directive 
amending Commission Directive 94/54/EC concerning the compulsory indication on the labelling of WT/TPR/M/136/Add.2 
Page 54  
 
certain foodstuffs of particulars other than tho se provided for in European Parliament and Council 
Directive 2000/13/EC. (SANCO D/04) 
• G/SPS/N/EEC/103/Add.7 (23/12/2003); Animal by -products and products derived therefrom 
- Addendum  SANCO/5096/2003 Rev.1:  Draft Commi ssion Regulation of extending the validity of 
Regulation (EC) No 812/2003 on  transitional measures under Regul ation (EC) No 1774/2002 as 
regards the importation and transit of certain  products from third countries. (SANCO D01 
• G/SPS/N/EEC/149/Add.5 (23/12/2003); Genetically  modified food and feed – Addendum : 
SANCO/2003/05304 "Draft Commission Regulation on  detailed rules for the implementation of 
Regulation (EC) No 1829/2003 of the European Parliament and of the Council as regards the 
preparation and the presentation of the application fo r the authorisation of new genetically modified 
food and feed, the notification of existing produc ts and adventitious or technically unavoidable 
presence of genetically modified material which h as benefited from a favourable risk evaluation"  
(SANCO D02) 
• G/SPS/N/EEC/184/Add.1 (23/12/2003); Live sheep and goats – Addendum: 
SANCO/4560/2003 Rev.5) Draft Commission Regulati on amending Annex VIII to Regulation (EC) 
No 999/2001 of the European Parliament and of the Council as regards trade in ovine and caprine 
animals for breeding) (SANCO D02)  
• G/SPS/N/EEC/226 (16/12/2003); Pesticides - Mefluidide : SANCO/10650/2003 Draft 
Commission Decision concerning the Non-inclusion of Mefluidide as Active Substance in Annex I to 
Council Directive 91/414/EEC and the Withdrawal of  Authorisations for Plant Protection Products 
containing this Active Substance (SANCO E/01).  
• G/SPS/N/EEC/227 (16/12/2003) Fruits of capsicum and curry powders : SANCO/4341/2003 
Draft Commission Decision on emergency measures with regard to adulteration by Sudan dyes of 
chilli and chilli products (SANCO D03).  
• G/SPS/N/EEC/228 (18/12/2003); Cereals: SANCO/10694/2002 Rev.5 Commission Directive 
amending the Annexes to Council Directives 86/ 362/EEC, 86/363/EEC and 90/642/EEC as regards 
maximum residue levels for certain pesticides prohibited for use in the European Community 
(SANCO E/01).  
• G/SPS/N/EEC/229 (23/12/2003); Foods for par ticular nutritional uses : SANCO/5143/2003 
Rev.3 Draft Commission Directive amending Direc tive 2001/15/EC to include certain substances in 
the Annex  (SANCO D/04)  
• G/SPS/N/EEC/230 (23/12/2003); Foods for partic ular nutritional uses:  SANCO/5144/2003 
Rev.3 Draft Commission Directive derogating from Directive 2001/15/EC to postpone the application 
of the prohibition of trade to certain products (SANCO D/04) 
• G/SPS/N/EEC/234. 29/01/2004; Poultry meat a nd eggs. Commission Decision of 23 January 
2004 concerning protection measures relating to avian influenza in Thailand (SANCO E/02)  
 
QUESTIONS FROM THAILAND  
 
GSP Drug Regime
 
 Q1. Could the European Communities confirm that its drug regime will be modified to be compatible with the DSB rulings by 1 July 2005?  Is it likely to result in more countries getting the 
drugs benefit or will it be removed altogether?  
A: On 1 July 2005, the drug arrangement will not be modified, it will be repealed, according to 
the WTO's decision. A new regime will then enter into force, based on objective criteria that will be 
published in the future GSP. This  criteria will be published, when the new GSP will be adopted, most 
likely in February/March 2005. At this moment, the beneficiary countries which consider that they fit 
with this published criteria will have  to make a formal application. It is of course too early to make 
any list of beneficiaries. Nevertheless, it may alr eady be noted that this regime will target the GSP WT/TPR/M/136/Add.2 
Page 55 
 
 
 beneficiaries most in need, i.e those facing "speci fic development needs", according to the Indian's 
panel jurisprudence. This countries will be the most  vulnerable ones (smallest beneficiaries, not listed 
as High income countries, not diversified econo mies, and having ratified and implemented the 
international conventions that makes up the sustai nable development). The Commission consider that 
the sustainable development has a cost, and that  it should make a special effort for the most 
vulnerable countries facing that specific burden. So, th is future "GSP+" is the appropriate answer to 
the "special development need" these countries are facing.  
Q2. Thailand is a country which is widely accepted as having undertaken a successful anti-
narcotic drugs programme to combat drugs traffickin g.  In view of this, we would like to know 
whether or not Thailand, being a developing country, could be eligible for inclusion in the list of 
countries qualified for the preference s under the Drug Arrangements.   
 
A: As said, the "drug arrangement" dedicated to the fight against drug production and trafficking 
will be repealed and will no longer exist after the en try into force of the ne w GSP regime, on 1 July 
2005. This regime has been declared as discriminatory by the Indian/panel's ruling. There is no option 
but repealing it. 
 
Textile Quotas  
(Secretariat’s Report, pp.53 para.49)  
  On 1 May 2004, the EC automatically extend ed EC’s textile quotas to the 10 acceding 
countries.  This took place despite the fact that Article 2.4 of the ATC requires that no new restrictions in terms of products or members can be introduced.   
 Remark: The quotation of article 2.4 above  omits the following: “… except under the 
provisions of this agreement or  relevant GATT 1994 provisions …” 
 
Q3. How does the EC reconcile the fact that new restrictions have been adopted by the acceding 
countries with the prohibition on new restrictions in Article 2.4 of the ATC?  
 
A: In the view of the Commission, restricti ons are not “new” but already existing ones being 
geographically expanded to cover th e territory of the enlarged EU. 
 Q4. If the EC affirms that Article XXIV of GA TT 1994 justifies such restrictions, how did the 
EC establish that the formation of the customs uni on implied by the enlargement would have been 
prevented if the introduction of the textiles quotas  to the new member states had not been allowed?  
 
A: Without covering also the ten new member st ates there would by definition have existed the 
possibility to evade existing restrictions unless fre e circulation within the expanded internal EU 
market of 25 members had been prohibited. Furt her, the common commercial policy acquis was taken 
over by the ten new members of the EU.  
Q5. If Article XXIV was the basis for the new textile quotas, what alternatives to applying 
textiles quotas in the new member states were explored?  
 
A: As implied in the answer to question 4 exemption from free circulation of imports into the ten new members states was an option, which, howev er was discarded since it was found that the 
advantages  free circulation in the expanded market  of EU 25 by far outwei ghed short term possible 
and alleged disadvantages for all parties involved.  WT/TPR/M/136/Add.2 
Page 56  
 
Q6. How does the EC expand the textile quotas for 10 new member countries? What is the 
calculation method used in determining tex tile quota allocation for the 10 new members?  
 
A: Calculations were based on data available on imports into the new member states during the 
three year period from 2000 to 2002. Average imports were added on a pro rata basis for 8 months to 
existing restrictions in application for EU 15 as fro m 1 May 2004. All restrictions will fall according 
to ATC provisions at the end of 2004.  
Anti-dumping
 
(Secretariat’s Report, pp.54-59)  
 
 Article 11(5) of the Council Regulation No . 384/96 on protection against dumped imports 
from companies not members of the EC, as amende d by the Council Regulation (EC) No 461/2004, 
states that expiry and interim reviews shall normal ly be concluded within 12 months of initiation 
and, in all cases, within 15 months. However, the EC has, in the amended regulation Article 11 (5), 
set a mandatory time limit of 15 months for both expiry and interim reviews.   
Q7. Does the EC anticipate that the majority of expiry and interim reviews will now be concluded before a 15-month mandatory time limit? 
 
A: Before the amendment to the Basic regulation,  review investigations were subject to an 
indicative period of completion of 12-month. Experien ce gained in the past shows that reviews have 
lasted longer than the normal timeframe. From now on, investigations aimed at reviewing existing 
anti-dumping or anti-subsidy measures and changes in form or in the level of such measures (review 
investigations) will be subject to strict mandatory deadlines. This should put an end to concerns about 
uncertainty regarding measures that remain in fo rce while - sometimes lengthy – reviews are ongoing. 
This responds to calls from economic operators (in particular importers an d exporters from third 
countries) for greater foreseeability. 
 In particular, “expiry reviews”, ie those that may take place at the end of the 5-year period of 
validity of the measures will now need to be c oncluded within 15 months .  From 2006, “interim 
reviews”, ie those that take place at the request of any party any time during the 5-year period of 
validity of the measures will also take place within a maximum duration of 15 months.  
 Q8. The recital 12 of the preamble to the amende d regulation argues that in the EC experiences 
expiry review and interim reviews “present the same complexity as new proceedings.”  Could the EC explain why this could be the case in term s of its procedural and/or legal matters?  
 
A: During the investigation for an interim or an expiry review the dumping and injury 
calculations have to be carried out with the si milar high standards as for initial investigations 
including the right of parties to submit information and comment our findings. That is why in certain 
circumstances, as stated in Recital 12 of the quot ed amended Regulation, expiry and interim reviews 
can be as complex as new proceeding especially where there are numerous interested parties involved. 
 
Q9. When the EC determines that circumvention is occurring in a third country, the normal 
practice is that duties are imposed on all product s concerned from the third country except those 
that have applied for, and been granted, an exemp tion on the basis that they are not involved in 
circumvention. How does the EC reconcile the requirement of Article VI and the WTO anti-
dumping agreement to establish dumping, injury and causal link when applying anti-dumping duties to products that have, in fact, not been  involved in circumvention practices yet have not 
applied for exemption?  
A: See reply under 13  WT/TPR/M/136/Add.2 
Page 57 
 
 
 Q10. Article 13(1) of the Council Regulation No. 384/96 on protection against dumped imports 
from companies not members of the EC as amende d by the Council Regulation (EC) No 461/2004, 
states that anti-dumping duties may be extended to products that have been modified so as to make 
them fall under customs codes which are not norm ally subject to the measures. Even if the 
essential characteristics of the product have no t changed, how does the EC reconcile the WTO 
requirement to establish dumping, injury and causal link with the fact that no such determination 
would have been made for such products legitimate ly classified under a no n-subject customs code? 
 
A: See reply under 13  Q11. How does the EC justify the expansion of collecting anti-dumping duty from non-EC members in 10 new member countries without reviewing the investigation?  
 Q12. How does the EC justify the elimination of  AD duty collection from 10 new members while 
continuing and expanding duty collection fr om non-EC members, which could result in the 
decreasing of competitiveness of non-EC memb ers that are subjected to AD measures?  
 
A: Combined reply to Qs 11 and 12
 
It is clear that enlargement by itself does not  automatically vary the dumping, subsidy and 
injury parameters, which form the basis of every tr ade defence measure. In the vast majority of cases, 
imports of the product concerned into the new EU Member States are small co mpared to those into 
the EU-15. In addition, the overall industrial outpu t of the new Member States represents less than 5-
7% of the industrial output of the EU-15. All of this suggests that it would be legally unreasonable 
and superfluous to open automatica lly reviews of all existing trade defence measures, creating a 
significant burden for a great number of operators invo lved and resulting in no change for most of the 
measures. The EU’s approach is to open reviews fo r those cases where interested parties request such 
reviews and submit evidence that the measures would have been significantly different if they were 
based on information including the new Member Stat es. Accordingly, exporting producers in third 
countries were encouraged and are still welcome to  submit such requests for enlargement-related 
interim reviews. 
Alternative approaches, e.g., automatic  suspension of measures or automatic ex officio  
reviews, would be less appropriate for addressing the situation of the enlargement of a customs union, 
i.e., less compatible with the principles of the ADA including rights of domestic industry to be 
protected from injurious dumping.  The EC would like to point out that, in orde r to ensure full transparency and a smoother 
transition for everyone in the area of trade defenc e due to EU enlargement, the EC approach was 
widely communicated, in particular via the following measures: 
 The EC launched an enlargement website “Enlargement – Impact on Trade Defence”. 
 Already in 2003 the EC set up a special Help Desk to answer questions on the impact of 
enlargement on trade defence and its contact information was published on the above-mentioned 
website and circulated to administrations and ec onomic operators in the EU acceding countries, the 
EU Member States and in third countries.  Seminars with the economic operators in the new Member States (producers, importers, users 
which were to be potentially be affected by  EU AD measures) were organised. Everybody was 
informed, so that they could react and ask for a review, in case it was thought to be necessary. 
 The EC also published a notice in the Official Journal OJ C 91/2 of 15.4.2004. The notice again set out the principles of the approach and re-ite rated an invitation to interested parties to request 
reviews. 
 The enlargement approach w as already three times discu ssed in this WTO Committee. 
 In addition, a further step was taken to ensure  that enlargement runs smoothly in terms of AD. 
The EC set up an enlargement task force. This taskforce contacted all countries with which the EC has WT/TPR/M/136/Add.2 
Page 58  
 
significant measures in force. Signi ficant has been interpreted in a very broad sense: 32 delegations 
were contacted, out of a total of 33 against which the EC has measures in fo rce. The Taskforce looked 
at all measures in force on the basis of a number of  parameters: the level of the duty, the significance 
of the level of imports into the acceding States, the level of production and the level of prices in the 
acceding States. As a result of this exercise we received 50 communications. On 20 March 2004 the 
EC initiated on its own initiative eight Article 11. 2 ADA reviews (Official Journal C 70/15), which 
led to the amendments of measures in force concerning eight products. 
 The national AD legislation, measures and on-going  investigations of the countries that joined 
the EU lapsed as of 1 May 2004 because these countri es automatically became part of the EU single 
market including the EU Common Commercial Policy. In the EU, the EU Member States do not have 
legal competence to pursue national commercial policies, which also means no legal basis for national 
trade defence actions. The principle of uniform app lication of trade defence measures across the entire 
customs union is in full conformity with the treatment of customs unions under GATT.  
Q13. Article 13 (1) of the amended Basic Regulation states that slight modification of the 
product resulting in reclassification in new custom s code may be subject to anti-circumvention 
measures, though now reclassified customs codes are not subject to AD measures in the original 
investigation.  Given that there is no agreement in WTO on circumvention, how could, in the EC 
views, the notions of dumping, injury and causal link in respect of the products under investigation 
be reconciled with the WTO’s requirement?  
 A: Combined reply for Qs 9, 10 and 13
 
  As a general matter, the EC is of the view th at the anti-circumvention provisions in its trade 
defense legislation are fully compatible with WTO ru les. In this regard, the EC would like to recall 
that a ministerial decision acknowledges that the Mini sters could not reach an agreement on this issue 
during the ministerial meeting in Marrakech. They had referred the issue to the antidumping practices 
Committee. Even though, up to now, no agreement h as been reached on this i ssue in this Committee, 
no provision prevents a WTO Member to take measures to address circumvention practices.  Council Regulation N° 461/2004 amending Artic le 13 (1) of Council Regulation  384/96 and 
Article 23 of Council Regulation (EC) No 2026/97 has introduced clearer rules to fight against circumvention of antidumping/antisubsidy measures. In particular, the new rules give more precise 
indications about what practises constitute circ umvention and about exemptions which may be 
granted to parties which can show that they were  not involved in circumvention practices.     
 The anti-circumvention provisions adopted by the EC aim at counteracting the effects of the circumvention of anti-dumping and anti-subsidy me asures in place, by ensuring that such measures 
are also applied to products that should normally be subject to those measures but, due to 
circumvention, would not be subject to the duties. Since the aim of the circumvention investigation is 
thus only to remedy the circumvention of the measures in place, it is not a new proceeding requiring a full analysis of dumping, injury and causal link. Ra ther is its scope limited to the question whether 
circumvention took place. Under EC law this requires an investigation of whether there is a change in 
the pattern of trade, insufficient  due cause or economic  justification for the cha nge in pattern of trade, 
evidence of injury or that the reme dial effects of the duty are being undermined in terms of the prices 
and/or quantities of the like product, and evid ence of dumping in relation to the normal values 
previously established for the like product.  All interested parties have the possibility to  cooperate in anti-circumvention investigations, 
the initiation of which is made known to the Govern ment of each country concerned. A party which 
decides not to cooperate knows that extended duties ma y be applied. It is the EU’s experience that 
those parties which circumvent anti-dumping measures are those which do not cooperate. 
 
  WT/TPR/M/136/Add.2 
Page 59 
 
 
 Sanitary and Phytosanitary Measures (SPS)  
(Secretariat’s Report, pp.64 para. 81)  
 
As pointed out in the Report, some of th e regulations in the area of sanitary and 
phytosanitary standards are much stricter than international regulations (e.g. CODEX and OIE) 
and there are high administrative costs in complying with them.  
In addition, the contamination levels required  are varied across EC member countries, for 
instance, the United Kingdom stipulates the contamination level of Nitroflurans at 1 ppb, whereas Germany is stricter than other EC member countries , goods will be eradicated immediately without 
sending them back to the exporting countries. 
Q14. Please clarify the rationale for imposing such a high standard.   
A: All Sanitary or Phytosanitary (SPS) measure s adopted by the EC are applied only to the 
extent necessary to protect human, animal or plant lif e or health and are based on scientific principles; 
furthermore, all proposed measures adopted in the pe riod object of this Trade Policy review have been 
notified to the WTO SPS Agreement for comments by other members. Only in very few instances the 
EC choose a level of SPS protection higher than the level that would have been achieved by measures 
based on the relevant international standards. In a ll these, the EC complied with Article 5(3) of the 
SPS Agreement and if requested, provided the scientific justification of such measure. 
 
Q15. Does the EC take into account the scientific test generally available and costs involved that 
is commercially viable when setting the standard?  
 
A: Yes.  
Q16. Where there are discrepancies in the level  of contamination in EC member countries, 
would the EC consider bringing them to the same standard so that there will be a consistency in 
implementing measures and regulatio ns for all EC member countries?  
 
A: The question is not understood well.  If the meaning is “if the EC contemplates harmonizing existing national standards for residues of 
contaminants ” the reply is “Yes”. In fact articles 94 and 95 of the Treaty provide that the Council on 
proposals from the Commission will issue directives for the approximation of laws of the Member 
States affecting the functioning of the common mark et. Indeed, third countries benefit also of the 
harmonized marketing conditions.  
Q17. Does the EC have the intention of relaxing those regulations to th e international level?  
 
A: If the meaning of “relaxation” is lowering the level of sanitary protection the reply is “no”. In 
fact Article 152 of the EC Treaty provides that , in the definition and implementation of all 
Community policies and activities a high level of  human health protection shall be ensured.
 
Community actions should hence improve public health ; this includes measures in the veterinary and 
phytosanitary fields.  
 If the meaning of “relaxation” is “facilitati ng access to EC markets”, the response is “yes”. 
Actually the EC has started numerous actions to si mplify access to EC markets of products of plant or 
animal origin from third countries.  
 
 
  WT/TPR/M/136/Add.2 
Page 60  
 
The REACH (Registration, Evaluation a nd Authorization of Chemicals) Proposal
  
(Secretariat’s Report, pp.114 para.84)  
  The ongoing development of the EC’s chem ical regulation called REACH poses serious 
concerns for its future adverse impact on a wide range of Thai industrial exports to the EC.  Most 
of the exporters of these products are downstream users of chemicals and are SMEs who have 
difficulties adjusting or preparing themselves to m eet the increased costs of registering, testing 
chemicals, conducting risk assessment, etc. in order to comply with REACH. 
While we support the EC’s intention to protect human health and the environment, Thailand 
continues to urge that EC’s legislation approv al process of the REACH be a balanced, cost-
effective workable approach, and not to pose unnecessary obstacles to trade.   
Q18. Does the EC have any plans to assist exporters in developing countries who may be 
adversely affected by REACH, such as bearing of hi gher costs, depriving of competitive edge due to 
a switch to required higher priced substances fo r producing export products to the EC market?  
What are (or will be) the features incorporat ed in REACH to accommodate these concerns?  
 
A: The European Communities recognises its obligations under Article 12.3 of the TBT Agreement to take account of the special devel opment, financial and trade needs of developing 
country Members, with a view to ensuring that REACH does not create unnecessary obstacles to exports from developing country Members. In a ddition to the provision of extensive guidance 
material, we aim to do our best to help devel oping countries to familiarise themselves with REACH 
and comply with it. This will be achieved in part  through technical assistance and capacity building 
but also through training and provision of information by the proposed Chemicals Agency.  
Q19. How does the EC plan to address the potential adverse effects caused by REACH on 
individual Members?  
 
A: See answer given above to question 18.  
Q20. Can the EC make sure that the developme nt of REACH conform to the GHS (UN Globally 
Harmonised System of Classification and Labellin g of Chemicals), and other criteria set by the 
IFCS (the Inter-Government Forum on Chemical Safety) as well as other relevant international 
conventions?  
 
A: REACH is fully compatible with the GHS. The European Commission is preparing 
complementary proposals for the implementation in  the Community of the GHS alongside REACH. 
We note that the REACH proposal is also comple mentary to other ongoing international efforts, 
providing a significant input to some, making best u se of the information made available in others, 
and avoiding duplication. REACH Annex I, section 0.4 specifically allows the use of available 
information from assessments carried out under ot her international and national programmes.  
 
Q21. With inadequate funds and limited level of economic development of the majority of 
developing countries, could time frame be extended for them to adapt their products or production 
methods before the EC regulation is strictly applied?  
 
A: REACH does not distinguish between the oblig ations on EU manufacturers and importers to 
the EU. The same time frame (up to 11 years after adoption of REACH, depending on tonnage) 
applies equally to all. There are no plans to change this. 
 
 
 WT/TPR/M/136/Add.2 
Page 61 
 
 
 Q22. How does the EC ensure that the standard evaluation is only for a good practice and by no 
means causing trade barriers?  
 
A: Evaluation should not cause trade barriers. Both “dossier evaluation” and “substance 
evaluation” are structured means by which regist ration dossiers are examined by the competent 
authorities of the Member States. In order to assure  consistent interpretation across the EU, the new 
Chemicals Agency will have powers to ensure cons istent decision-making and registrants have the 
opportunity to appeal against decisions.  
Q23. Could recognised institutions in other count ries, for example, the US’ EPA Evaluation be 
accredited?  
 
A: REACH does not require data to be genera ted from “recognized” or “accredited” institutions. 
Any existing information can be used for registra tion purposes, as long as it is fit for purpose. If new 
information must generated, and if this new in formation can only be provided following laboratory 
tests, then, in accordance with article 12, good laboratory practice (GLP) must be applied in its 
generation.    In addition, Annex I of REACH allows info rmation from available in ternational assessments 
of chemicals, such as those undert aken by the US EPA, to be taken into account and used where 
appropriate in the completion of Chemical Safety  Assessments. Also, Artic le 117 enables authorities 
to share their assessments. 
 
Q24. Article 26 Point 2 (b) “the deadline laid down in Article 21 (2) for phase-in substances 
manufactured or imported in quantities of 1 tonne or more per year
” does not correspond with 
Article 21(2) which states “in quantities reaching 100 tonnes or more per year ”. Could the EC 
clarify this difference?  
 
A: Article 26 sets out the requirement for potential registrants to pre-register substances in order 
to benefit from the phase-in deadlines. There are tw o pre-registration deadlines and three registration 
deadlines. The second pre-registration deadline is set out  in article 26(2). It is 18 months before the 
phase-in deadline for substances manufactured or  imported in quantities above 100 tonnes (article 
21(2)). Because there is no third pre-registration d eadline, the second pre-registration deadline covers 
all substances above 1 tonne.  
 
Enlargement and Non-Uniform Practices among Member States  
 Q25. How does the EC intend to tackle problems that continue to impede bilateral trade with 
Thailand, such as non-uniform practices among member states, inconsistent application and 
interpretation by member states of legislation,  complications and overlaps among directives?   
 
A: As of 1 May 2004 external trade between thir d countries and the enlarged EU of 25 Member 
States follows the same rules and practices as trade be fore this date with the then 15 Member States. 
We are not aware of such problems as referred to by Thailand. It can, however, not be excluded that, immediately after 1 May 2004, some provisional diffi culty in this regard might have occurred in 
isolated cases. One has to bear in mind that the individual foreign trade regimes of ten previously 
entirely autonomous European economies in respect of  foreign trade had to be merged and integrated 
into the trade regime of the EC of 15 existing Me mber States as governed by the Customs Union and 
the Community Commercial Policy. Since 1 May 20 04 the EC of 25 Member States has one single 
customs territory and the common external trade regime  is applied uniformly to this territory in its 
entire extension. Due to entirely free circulati on within the whole Community of now 25 Member 
States, the goods arriving from Thailand may be declared  in the first sea port or airport of arrival (for WT/TPR/M/136/Add.2 
Page 62  
 
example, Hamburg, Amsterdam, Frankfurt or Naples) and after customs clearance can then be transferred without any further customs duties or other impediments to their final destinations. 
Services
 
Q26. Some members (France and maybe Italy) have indicated in the Schedule of Specific 
Commitments under GATS that for establishing indu strial, commercial or artisanal activities, a 
‘specific authorization’ is needed if the managi ng director is not holder of a permanent residence 
permit. We would like to seek clarification on detailed criteria and procedures for granting such 
‘specific authorization.’  
A: Foreign citizens that want to undertake in  France an industrial, commercial or artisanal 
activity in their name, need to be holder of an identity card as specified by the “Décret no 98-58 du 28 
janvier 1998 and “circulaire intermin istérielle du 8 juin 1998”. The detailed criteria and procedures 
for granting such authorisation can be f ound under the following link:  http://admi.net/jo/ 
19980131/ECOA9730014D.html. 
Q27. Concerning the entry into and temporary stay within the EC of natural persons who 
provide services, the EC has indicated in her initia l offer that Contractual service suppliers (CCS) 
are subject to the application of a ‘numerical ce iling’ whose modalities of application and level to 
be determined, we would like to inquire about th e progress, as well as brief details, of such 
modalities resulting in the numerical ceiling.  
A: This is an issue to be addressed in services negotiations under the DDA. 
Q28. In some cases, for establishing business or  professional services, some Member States have 
restricted the access to ‘Natural persons,’ we woul d like the EC to clarify the meaning of ‘access 
through natural persons.’  
A: Access through natural persons means that the services in question cannot be provided by 
juridical persons. 
Q29. In connection with public health insurance, we would like to ask the EC whether the 
citizens of the Member States can reimburse th eir expenses arising fr om consuming private 
hospital services within the EC or not. If so , how much can they reimburse, and on what 
conditions? Also, if such expenses arising outsid e the EC, are such reimbursement and conditions 
still the same as in the case of within the EC?  If not, what is the difference?  
A: Persons entitled to receive health care benef its in their own Member State are pursuant to 
certain conditions entitled to have the cost of that  care assumed also when it is received in other 
Member States. The conditions under which the care is delivered and level of assumption is regulated 
by national law and thus varies between the di fferent Member States. Community Law does not 
regulate access to care outside the EEA- area. The qu estion of access to care outside the EEA- area is 
thus regulated by national law of the Member States. 
Agriculture  
CAP Reform  
Q30. To better understand the CAP reform and its effects on EC’s agricultural production and 
trade, we would like to request detailed info rmation on the breakdown of domestic support 
measures (Amber, Blue and Green Boxes) accord ing to the CAP reform, together with their 
respective values for individual ma jor agricultural commodities, in particular rice and sugar.   WT/TPR/M/136/Add.2 
Page 63 
 
 
 A: Measures contained in the reformed CA P will be notified to WTO’s Committee on 
Agriculture as foreseen in Art. 18 of the Agreement on Agriculture 
Rice  
Q31. The Secretariat Report (page 95, Table IV .5) mentions the mandate for negotiation on 
tariff quotas on rice imports.  As Thailand is in the process of negotiating with the EC under 
Article XXVIII of the GATT, we would appreciate clar ification from the EC regarding its plan to 
further the negotiation.  We urge the EC to conclude the negotiation soonest.  
A: The EC confirms its intention to conclude the negotiation as soon as possible.    
Sugar subsidies  
Q32. Could the EC elaborate on how it intends to  implement its sugar regime, and whether or 
not there are different phases of implementation and whether or not it is in any event linked to the 
DDA? 
A: There is no sugar reform legislation to implem ent yet. A proposal is currently under way with 
respect to the reform of the CAP for this item. 
Waste portable batteries  
Q33. Regarding the revised Directive on Batteries and Accumulators, which include producer 
responsibility for the collection and recycling of used batteries, do EC importers have any 
responsibility for the cost incurred  in battery collection and recycling?  
A: Yes.  The Commission's Proposal for a new Battery Directive (COM (2003) 723final) 
establishes financial producer responsibility for the w aste management of batteries.  It follows from 
the definition of "producer" that this applies to ba ttery producers established in the European Union as 
well as to professional importers of batteries from third countries into the EU.  This Proposal, 
including the financial producer responsibility, is  currently being discussed in the European 
Parliament and Council, in view of its formal adoption on the basis of a co-decision procedure. 
New Initiatives on EC Trade-Preference Scheme  
Q34. The EC is poised to launch a new trade-preference scheme aimed at giving duty-free access 
for about 7,200 product lines originating in smaller countries with vulnerable and poorly diversified economies.  The new scheme, which is  to take effect from January 2006, is geared 
towards developing countries that implement the Ky oto protocol and other international treaties on 
human rights, labour standards and the environment.  In this regard, we would be interested in 
receiving further information about the new trade-preference scheme, as well as the EC views as to how it will ensure the scheme’s full complia nce with WTO’s rules and regulations.  
A: As stated in question 1, the new regime Th ailand is referring to is the so-called future 
"GSP+". It will provide a positive discrimination (b etter preferential treatment) to those of the 
beneficiaires facing "special development needs". Th e beneficiaries that are both the most vulnerable 
ones on one hand, and that accept to pave the way for a more sustainable development on the other, 
have to face special burdens/costs, that may hamper ed their economic development. Because of this 
situation, the EC considers that it is fully in line with the WTO's ruling, which allows for any special 
treatment as far as they are based on "objective crite ria" and are not discriminatory between countries 
being in the same conditions. 
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