WORLD TRADE  
ORGANIZATION  WT/REG282/1 
18 April 2011 
 (11-1986) 
Committee on Regional Trade Agreements  
  
 
   
 
 
FACTUAL PRESENTATION 
 
Free Trade Agreement  
between  
Turkey and Montenegro 
(Goods) 
 
Report by the Secretariat 
 
 
 
 This report, prepared for the considera tion of the Free Trade Agreement between 
Turkey and Montenegro has been draw n up by the WTO Secretariat on its own 
responsibility and in full consultation with the Parties.  The report has been drawn 
up in accordance with the rules and pro cedures contained in the Decision for a 
Transparency Mechanism for Regiona l Trade Agreements (WT/L/671).  
 Any technical questions arising from this  report may be addressed to Ms. Rohini 
Acharya (tel: +41 22 739 5874).  WT/REG282/1 
 Page iii 
 
 
  TABLE OF CONTENTS 
 
 
 Page 
 
I.  TRADE ENVIRONMENT 1  
II.  CHARACTERISTIC ELEMENTS OF THE AGREEMENT 4  
A.  BACKGROUND INFORMATION  4  
III.  PROVISIONS ON TRADE IN GOODS 5  
A.  IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  5  
1.  General provisions 5  
2.  Liberalization of trade and tariff lines 6  
3.  Turkey's liberaliz ation schedule 7  
4.  Montenegro's liberalization schedule 10  
5.  Tariff Rate Quotas 13  
B.  RULES OF ORIGIN  14  
C.  EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  16  
D.  REGULATORY PROVISIONS OF THE AGREEMENT  16  
1.  Standards 16  
(a)  Sanitary and phytosanitary measures 16  
(b)  Technical barriers to trade 16  
2.  Safeguard mechanisms 17  
(a)  Global safeguards 17  
(b)  Bilateral safeguards 17  
(c)  Special safeguard for agricultural products 18  
3.  Anti-dumping and coun tervailing measures 18  
4.  Subsidies and State-Aid 18  
5.  Other regulations 18  
(a)  Customs-related procedures 18  
(b)  Services and Investment 19  
(c)  Transfers and payments 19  
(d)  Competition 19  
E.  SECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  20  
IV.  GENERAL PROVISIONS OF THE AGREEMENT 20  
A.  TRANSPARENCY  20  
B.  EXCEPTIONS  20  
C.  ACCESSION AND WITHDRAWAL  20  
D.  INSTITUTIONAL FRAMEWORK  21  
E.  DISPUTE SETTLEMENT  21  
F.  RELATIONSHIP WITH OTHER AGREEMENTS CONCLUDED BY THE PARTIES  21  
G.  GOVERNMENT PROCUREMENT  22  
H.  INTELLECTUAL PROPERTY  22  
ANNEX I 24  WT/REG282/1 
 Page 1 
 
 
   
Key Facts 
 
Parties to the Agreement: Turkey and Montenegro 
 
Date of Signature:  26 November 2008 
 Date of Entry into Force: 1 March 2010 
 Date of Notification:  12 March 2010 
 
  
I. TRADE ENVIRONMENT 
1. The Free Trade Agreement between Turkey and Mo ntenegro (hereinafter "the Agreement") is 
the fifth regional trade agreement (RTA) concluded by Turkey with a Balkan country and notified to 
the WTO.  It is the first bilatera l agreement concluded by Montenegro.
1 
2. In 2009, Turkey's GDP was US$617 billion, w ith a population of 72.5 million, whereas 
Montenegro's GDP was US$4 billion, with 624,000 inhabitants.  Turkey ranked 33rd and 23rd among 
the world's exporters and impor ters of goods, with exports of  US$102.1 billion and imports of 
US$140.9 billion.  These represented 0.82% and 1.11% of world merchandise exports and imports.  In 
comparison,  Montenegro was the world's 157th largest exporter and 148th largest importer of goods, 
with total exports of US$585 million and imports  of US$1.8 billion (0.00% and 0.01% of world 
exports and imports).  Bilaterally, in 2009, Montenegro was the 93rd import source for Turkey and its 
90th export destination.  The trade structure of the two countries is similar with manufactures 
accounting for almost half of their exports and im ports, followed by fuels and mining and agriculture.2   
3. Recent developments in global and intra-Party tr ade are presented in Charts I.1 (Turkey) and 
I.2 (Montenegro).  During 2001-2009, Turkey's overa ll trade deficit continued to widen.  There was a 
sharp fall in both exports and imports in 2009, bot h globally and with Montenegro.  Over the same 
period, Montenegro's trade deficit increased especi ally as imports increased sharply until 2008.  
Turkey has run a significant surplus in its trade w ith Montenegro, with a peak in exports in 2008.3   
4. The commodity structure of trade between the Par ties, as well as of their imports and exports 
to the world in the period 2007-2009 is shown in Ch art I.3, on the basis of the Harmonized System 
(HS) sections.  Turkey's imports from Montenegro, valued at US$2.4 million, were dominated by base 
metals, which accounted for 81.6% of its imports from Montenegro, and 69% of Montenegro's global 
exports.  Montenegro's imports from Turkey amount ed to US$18.9 million and were more diversified 
with machinery, vehicles, textiles and base metals  accounting for 67.8% of bilateral imports.  These 
four categories were also Turkey's main exports to the world.  
                                                      
1 WTO RTA Database, http://rtais.wto.org/UI/Pu blicMaintainRTAHome.aspx  
2 WTO Statistics Database, Trade Profiles (October 2010). 
3 There are significant differences in  the bilateral trade reported by the Parties to the UNSD Comtrade 
database.  The reason for the discrepancy is not clear. WT/REG282/1 
Page 2  
 
  0100200300
2001 2002 2003 2004 2005 2006 2007 2008 200901020304050US$billion US$millionChart I.1 - Turkey: Merchandise impo rts from and exports to the world 
and Montenegro, 2001-2009
Note: trade data with Montenegro available since 2006.
Source : UNSD, Comtrade database.Imports from the Montenegro
Exports to the MontenegroTotal imports
Total exportsLeft hand scale: Right hand scale:
 
 
 
05001,0001,5002,000
2001 2002 2003 2004 2005 2006 2007 2008 2009051015202530US$million US$millionChart I.2 - Montenegro: Merchandise imports from and exports to the 
world and Turkey, 2001-2009
Source : Montenegro authorities.Imports from Turkey
Exports to TurkeyTotal imports
Total exportsLeft hand scale: Right hand scale:
  WT/REG282/1 
 Page 3 
 
 
  Chart I.3
Turkey and Monteneg ro: product composition of merchandise trade, annual 
average 2007-2009
Turkey's imports from Montenegro Montenegro's imports from Turkey
Source:  UNSD, Comtrade database and Montenegro authorities.Per cent
Total:  US$2.4 million Total:  US$18.9 million
Total:  US$170,964 million Total: US$1,477 million
Total:  US$113,804 million Total:  US$272 millionTurkey's global exports Montenegros's global exportsTurkey's global imports Mo ntenegro's global imports 
Machinery
16.6
Machinery 
19.8
Vegetables 4.2Minerals 2.4
Textiles
19.1Other 
5.7Other 
6.3
Minerals 7.4Base metals 15.0
Prepared foods 3.6
Base metals
69.0 Miscellaneous 4.1
Vehicles 15.8Articles of wood 4.2Other
2.0Other 
3.4
Minerals 3.7Other 
5.6Machinery 29.1
Minerals 22.6
Plastics 6.0Textiles 5.4Plastics 3.5Vegetables 2.0Other 
9.4
Base metals  9.5Textiles 2.7
Minerals 16.3
Chemicals 2.8Base metals 81.6Chemicals 3.7
Prepared foods 9.4Vehicles 11.1Vegetables 3.2
Articles of stone 3.7
Precious stones 4.1Raw hides 8.4Vehicles 8.0 Vegetables 3.4
Base metals 11.3
Chemicals 3.0Vehicles 
14.3Plastics 5.0
Vegetables 1.9
Prepared foods 7.7Machinery 4.4Chemicals 9.0Vehicles 8.2Precious stones 2.6
Chemicals 7.1Live animals; Animal 
products 5.0Textiles 13.1Prepared foods 6.5Articles of stone 4.0Miscellaneous 3.8
Wood pulp 3.3
Base metals 
16.1
Machinery 14.4Plastics 4.2Articles of stone 2.4
 WT/REG282/1 
Page 4  
 
  II. CHARACTERISTIC ELEMENTS OF THE AGREEMENT 
A. B
ACKGROUND INFORMATION  
5. The Free Trade Agreement between Turkey an d Montenegro was signed on 26 November 
2008 and entered into force on 1 March 2010.  It was notified by Turkey to the WTO on 12 March 2010 as an agreement establishing a free-trade area  pursuant to Article XXIV:7(a) of GATT 1994.  
The Agreement was notified by Turkey on behalf of both Parties since Montenegro is not a member to 
the WTO.
4 
6. The text of the Agreement, together with its  Annexes and Protocols, is available on the 
Parties' official websites [Please confirm] : 
- Turkey: 
http://www.dtm.gov.tr/dtmadmin/upload/AB/SerbestTicaretDb/Montenegro.pdf  
- Montenegro: 
http://www.mek.gov.me  
7. The Agreement consists of four chapters, two annexes, two protocols with their respective 
annexes and a Joint Declaration.  All the protoc ols and annexes form an integral part of the 
Agreement and the Joint Committee may amend them , in accordance with the legislation of the 
Parties (Article 35). 
Box II.1: Contents of the Agreement  
Preamble  
  
Chapter I  Industrial Products  
Chapter II    Agricultural and Fishery Products  
Chapter III  Services and Investments  
Chapter IV  Common Provisions  
 
Annex I   List of products referred to in Articles 3 and 9
 
Annex II  Montenegrin tariff concessions for industrial products originating in Turkey  
Protocol I  Referred to in Article 10 
Protocol II    
 
Joint Declaration 
 Concerning the definition of the concept of  "originating products" and methods of 
administrative cooperation 
 
Source: The Agreement 
 
8. The Agreement gradually establishes a free-trad e area between the Parties over a transition 
period of five years, which started on the Agreemen t's entry into force (1 March 2010), in accordance 
with Article XXIV of GATT 1994 and other WTO Agreem ents on trade in goods.  It shall also take 
into account Turkey's obligations under the Custom s Union with the European Union (EU) as well as 
Montenegro's obligations under the Associa tion Agreement with the EU (Article 1.1). 
 
                                                      
4 On 4 March 2006, the Committee on Regional Trade Agreements (CRTA) agreed  that regional trade 
agreements (RTAs) between WTO Members and non-Member s shall also be subject to the procedures of the 
General Council Decision to establish a Transparency Mechanism on RTAs (document WT/L/671), whose 
Paragraph 7(b) requires the WTO Secretariat to prep are a Factual Presentation of such agreements.    WT/REG282/1 
 Page 5 
 
 
  9. Where a Party considers that it would be useful and in the interest of the Parties' economies to 
develop the relations established by the Agreement by extending its scope, it shall submit a reasoned 
request to the other Party.  The Joint Committee shall examine the request and make appropriate 
recommendations, particularly with a view to commencing negotiations.  Any agreement resulting 
from such a process shall be subject to ratification or approval by the Parties in accordance with their 
national legislation (Article 33).  According to the Parties there have been no developments in this 
regard.  
III. PROVISIONS ON TRADE IN GOODS  
A. IMPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
1. General provisions 
10. The Agreement provides two different liber alization programmes for non-agricultural 
products, covered by Chapter 1, and agricultural and fishery products, dealt with in Chapter 2.   
11. Chapter 1 applies to products of Chapters 25 to  97 of the HS, with the exception of products 
listed in Annex I which are treated as agricultural products (WTO definition) (Article 3).  Turkey 
eliminated all customs duties on non-agricultural impo rts from Montenegro upon entry into force of 
the Agreement (1 March 2010) (Article 4.2).  Libera lization by Montenegro is also immediate, except 
for non-agricultural products listed in Annex II of th e Agreement that are subject to progressive tariff 
elimination ending five years after the entry into forc e of the Agreement (1 January 2015), at the latest 
(Article 4.3 and 4).  
12. Turkish products listed in Annex II shall be granted treat ment no less favourable than that 
accorded by Montenegro to like products of the Europ ean Union, including the automatic extension of 
any favourable change in the treatment accorded to th e EU;  Turkey shall be promptly notified thereof 
(Article 4.6). 
13. Chapter 2 covers basic and processed agricultura l products and fishery products originating in 
the Parties under HS Chapters 1 to 24, includi ng products listed in A nnex I of the Agreement 
(Article 9).  Under the Agreement, the Parties agreed to exchange mutual concessions on some 
agricultural products in the form of tariff rate quotas (TRQs)  and for lentils originating in Turkey 
Montenegro granted full liberalization, as set forth in Protocol I to the Agreement (Article 10.1).  
14. The Parties shall examine, in the framework of  the Joint Committee, the possibility of further 
liberalizing trade in agricultural products, by taki ng into account the role of agriculture in their 
respective economies, the development of trade in agriculture, the sensitivity of such products and 
their respective agricultural policies (Article 10.2).  According to the Parties no further developments 
have taken place in this regard.  
15. The Parties committed to abolish any charges ha ving equivalent effect to customs duties on 
their respective imports upon entry into force of the Agreement, and to not introduce new customs duties or charges having equivalent effect on bilate ral trade (Article 4.1 and 5).  These commitments 
also apply to duties of a fiscal nature (Article 5) .  Under Article 14, the Parties shall not apply new 
measures, and abolish existing measures or practices of  an internal fiscal nature which directly or 
indirectly discriminate between pr oducts of one Party and like products  originating in the other Party. 
16. All existing quantitative restrictions on imports  (and exports) and meas ures having equivalent 
effect will be abolished while new quantitative rest rictions on imports (and e xports) or measures with 
equivalent effect shall not be introduced by the Pa rties as from the entry into force of the Agreement 
(Article 7).  WT/REG282/1 
Page 6  
 
  2. Liberalization of trade and tariff lines  
17. Annex II contains the Montenegrin tariff concessi ons on non-agricultural products originating 
in Turkey.  For products listed in Table A, duties shall be reduced and eliminated over a three-year 
period (01.03.2010 - 31.1 2.2012), and will be duty-free on 1 Jan uary 2013.  These include certain 
tariff lines in HS Chapters 25, 36, 38, 44, 64, 76, 84, 85 and 87.  For products in Table B, the 
phase-out period is five years (01.03.2010 - 31.12.20 14), and duties shall be abolished on 1 January 
2015.  Products in Table B include some tariff lines in HS Chapters 25, 33, 34, 39, 40, 42, 44, 48, 49, 51, 52, 61-64, 68, 69, 72, 73, 76, 83, 84, 87 and 94.  
18. Protocol I establishes TRQs for imports  into Montenegro of dried apricots  originating in 
Turkey (Annex I to Protocol I), and for imports into  Turkey of pasta, jams, fruit jellies, marmalades 
etc., cooked, and wine of fresh grapes originating in Montenegro (Annex II of Protocol I) (see section 
II.B.2 of the presentation).
5  Protocol I also establishes full libera lization for imports into Montenegro 
of lentils originating in Turk ey (Annex I to Protocol I). 
19. With respect to trade covered by the Agreem ent, the Parties shall apply their respective 
Customs Tariffs on the classification of goods.  The basic customs duty on which successive tariff 
reductions are based is the applied MFN rate in fo rce in each Party at the time the Agreement entered 
into force (i.e. MFN 2010).  Reduced tariffs shall replace the basic duties where a tariff reduction is 
applied erga omnes  by a Party after the entry into force of th e Agreement, in particular as a result of 
WTO negotiations (Article 2). 
20. Overall tariff elimination under the Agreement,  in terms of number of lines and value of 
trade, is depicted in Tables II.1.A (Turkey) and II.1.B (Montenegro).  In 2010, Turkey's MFN tariff 
schedule comprised 11,939 lines at the HS 10-digit level, of which 206 held non- ad valorem  duties.6  
Before the entry into force of the Agreement, 2,790 lines were already duty-free on an MFN basis, 
representing 23.4% of Turkey's tota l tariff and 75.9% of its total av erage imports from Montenegro in 
2007-2009.  Upon entry into force of the Agreement, a further 6,900 lines were liberalized, representing more than half (57.8%) of Turkey's tariff  and 23.8% of its bilateral imports.  Turkey will 
maintain duties on 2,249 lines;  as a result, 81.2% of tariff lines and 99.7% of bilateral trade will be 
liberalized by Turkey under the Agreement. 
Table II.1 
Tariff elimination commitments under the Agreement and corresponding average trade 
A. Turkey 
Duty phase-out 
period Number of lines % of total lines in 
Turkey's tariff 
schedule Value of Turkey's imports 
from Montenegro 
(2007-2009) 
in million US$ % of Turkey's total 
imports from  
Montenegro 
2007-2009 
MFN duty free 
(2010) 2,790 23.4 1.9 75.9 
2009 6,900 57.8 0.6 23.8 
Remain dutiable 2,249 18.8 0.0 0.3 
Total 11,939 100.0 2.4 100.0 
 
Note: Tariff lines subject to in-quota rates are excluded in the computation. 
Based on the HS 2007 nomenclature. 
 
Source :  WTO estimates based on data provided by Turkey. 
                                                      
5 One tariff line (lentils) is also listed in Annex I to Protocol I as being subject to a tariff rate quota 
when imported by Montenegro from Turkey.  However, the quota volume is unlimited and hence the line is treated in the Secretariat's calcu lations as fully liberalized.  
6 Of these: 16 were specific duties, 123 compound duties, 11 mixed duties and 56 other duties.   WT/REG282/1 
 Page 7 
 
 
  21. Montenegro's tariff schedule in 2010 comprised 9,482 lines at the HS 10-digit level, of which 
277 held specific duties.  Before the entry into  force of the Agreement, 459 lines were already 
duty-free, accounting for 4.8% and 2.3% of respectively its tariff and total imports from Turkey in 2007-2009.  Upon entry into force of the Agre ement, 6,672 lines became duty-free, representing 
70.4% of its tariff and 71.4% of its imports from Turkey.  At the end of the implementation period, in 
2015, a further 271 lines will be liberalized.  These re present 2.8% of Montenegro's tariff and 16.4% 
of its imports from Turkey.  Under the Agreement,  2,080 lines will remain subject to duties;  as a 
result, 78.1% of tariff and 90.1% of impor ts will be liberalized by Montenegro. 
Table II.1 
Tariff elimination commitments under the Agreement and corresponding average trade 
B. Montenegro 
Duty phase-out period Number of lines % of total lines in 
Montenegro's tariff 
schedule Value of Montenegro's 
imports from Turkey  
(2007-2009) 
in million US$ % of Montenegro's 
total imports from 
Turkey 
2007-2009 
Duty free (2010) 459 4.8 0.4 2.3 
2010 6,672 70.4 13.5 71.4 
2011 1 0.0 0.0 0.0 
2013 33 0.3 0.6 3.1 
2015 237 2.5 2.5 13.3 
Remain dutiable 2,080 21.9 1.9 9.9 
Total 9,482 100.0 18.9 100.0 
 
Note: Based on HS 2007 nomenclature. 
 
Source :  WTO estimates based on data provided by Montenegro. 
 
3. Turkey's liberalization schedule 
22. A more detailed perspective of Turkey's tariff elimination under the Agre ement is depicted in 
Chart II.1.  Before the entry into force of the Agre ement, 2,790 lines were duty-free on an MFN basis.  
Of the 6,900 lines liberalized by Turkey pursuant to the Agreement, almost a ll (6,279) held duties of 
10% or less.  Liberalization also concerned 561 lines with duties between 10 and 20% and 18 lines 
with duties between 20 and 30%. WT/REG282/1 
Page 8  
 
  0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,0002010Chart II.1
Turkey's duty elimination under the Agreement
Year of duty free treatment   
Source :  WTO Secretariat estimates, based on data provided by Turkey.Number of duty-free lines (cumulative)
Duty-free <10% <20% <30% MFN is: <50% Non ad valorem duty >50% <40%
 
 
23. Turkey's tariff elimination commitments unde r the Agreement by HS Section product 
categories is shown in Table II.2.  Of the 6,900 li nes liberalized by Turkey upon entry into force of 
the Agreement, the vast majority (4,051) fall in HS Sections XI (textiles), XVI (machinery) and VI 
(chemicals).  Of the 2,249 lines that retain duties under the Agreement, almost all concern agricultural 
products in HS Sections I-IV, whereas 64 lines fa ll in HS Section VI (chemicals).  The overall 
average tariff in 2010 on dutiable lines is 56.5%, w ith the highest rate for live animals (88.2%). 
Table II.2 
Turkey:  Tariff elimination under the Agreement, by HS section 
Number of 
duty-free lines  HS section and description  MFN 
average%  Total No of 
lines  MFN 
2010  2010  Remain 
Dutiable Avg. Final 
Tariff 
(Dutiable)  
I Live animals and animal 
products 80.8 830 70  760 88.2 a 
II Vegetable products 30.2 571 54  517 33.4 a 
III Animal or vegetable fats and 
oils 17.3 138 23  115 20.7 a 
IV Prepared foods etc. 46.5 855 62  793 50.2 a 
V Minerals 0.9 246 162 84   
VI Chemicals and chemical 
products 4.4 1,559 372 1,123 64 7.7 
VII Plastics and rubber 4.0 414 103 311   
VIII Hides and skins 2.9 188 56 132   
IX Wood and articles 2.1 293 150 143   
X Pulp, paper etc. 0.0 386 386    
XI Textiles and textiles ar ticles 7.7 1,706 55 1,651   
XII Footwear, headgear 7.5 122 3 119   
XIII Articles of stone 4.0 318 38 280   
XIV Precious stones, etc. 1.0 72 51 21   
XV Base metals and base metals 
products 4.0 1,237 381 856   
Table II.2 (Cont'd)   WT/REG282/1 
 Page 9 
 
 
  Number of 
duty-free lines  HS section and description  MFN 
average%  Total No of 
lines  MFN 
2010  2010  Remain 
Dutiable Avg. Final 
Tariff 
(Dutiable)  
XVI Machinery 2.1 1,842 565 1,277   
XVII Transport equipment 5.4 347 33 314   
XVIII Precision equipment 2.3 453 146 307   
XIX Arms and ammunition 2.3 30 5 25   
XX Misc. manufactured articles 2.6 318 61 257   
XXI Works of art, etc. 0.0 14 14    
Total 13.7 11,939 2,790 6,900 2,249 56.5 
 
a Average of ad valorem  tariffs and ad valorem  component of non- ad valorem  duties. 
Note: Tariff lines subject to in-quota rates are excluded in the computation; for the calculation of averages, specific rates a re excluded 
and the ad valorem  part of alternate rates are included. 
Based on the HS 2007 nomenclature. 
 
Source : WTO Secretariat estimates based on data provided by Turkey. 
 
24. Chart II.2 shows a comparison between average preferential duties for lines remaining subject 
to duty under the Agreement and their correspondi ng MFN average rates by HS Chapter.  For 
agricultural products (HS Chapters 1-24), the pr eferential average duties and corresponding MFN 
average duties are the same, indicating that no pref erential liberalization has taken place with respect 
to these products under the Agreement;  pasta, jams, fruit jellies, marmalades etc., cooked, and wine 
of fresh grapes are subject to TR Qs.  The same situation applies to non-agricultural products of 
HS Chapters 29, 33, 35 and 38.  The highest av erage rate for agricultural products applies to 
HS Chapter 2 (meat and edible meat offal) (1 34.2%) and, for non-agricultural products, to 
HS Chapter 35 (albuminoidal substances, starches, glues, enzymes) (10.2%). WT/REG282/1 
Page 10  
 
  020406080100120140
01
02030405060708
09
1011121315161718192021222324020406080100120140
29
333538Chart II.2
Turkey: Average of dutiable rates, by HS Chapter
HS  01-24 HS 25-97Average rate of duty (%)  
Average rate of duty (%)  
HS Chapter HS Chapter
MFN Preferential
Note: For tariff lines with non ad valorem components, only the ad valorem part of alternate rates are included in the calculation; 
Source :  WTO Secretariat estimates based on data provided by Turkey. 
 
 4. Montenegro's liberalization schedule 
25. A more detailed perspective of Montenegro's  tariff elimination under the Agreement is 
depicted in Chart II.3.  Before the entry into for ce of the Agreement, 459 lines were duty-free.  Of the 
6,672 lines liberalized by Montenegro upon entry into force of the Agreement, almost all (6,545) held 
duties of up to 10%, 110 lines held duties between 10 and 20% and 27 lines between 20 and 30%.  
The additional 271 lines that are to be liberalized at the end of implementation in 2015 are also 
subject to duties equal to or below 30%.  
  WT/REG282/1 
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  0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000201020112012201320142015Chart II.3
Montenegro's duty elimination under the Agreement
Year of duty free treatment   
Source: WTO Secretariat estimates, based on data provided by Montenegro.Number of duty-free lines (cumulative)
Duty-free <10% <20% <30% Applied rate is:
 
 
 
26. Table II.3 shows the tariff elimination comm itments undertaken by Montenegro under the 
Agreement by HS Section product categories.  Of the 6,672 lines liberalized by Montenegro upon entry into force of the Agreement, more than half  (3,555) fall under HS Sec tions XVI (machinery), VI 
(chemicals) and XI (textiles).  At the end of the im plementation, the 271 lines that are to be liberalized 
fall mainly under HS Sections XV (base metals) and XI.  Almost all of the 2,080 lines (2,000) that 
remain dutiable under the Agreement concern agri cultural products under HS Sections I-IV, whereas 
the rest fall mainly under HS Section VI (chemical s).  The overall average tariff in 2015 on dutiable 
lines will be 15.6%, with the highest ra te for prepared foodstuffs (19.2%). WT/REG282/1 
Page 12  
 
  Table II.3 
Montenegro: Tariff elimination und er the Agreement, by HS section 
Number of duty-free lines  
HS section  Applied 
rate 
avg.%  Total 
No of 
lines  Applied 
rate 
2010  2010  2011  2013  2015  Remain 
dutiable  Avg. Final 
Tariff 
(Dutiable)  
I Live animals and animal 
products 15.5 789 40     749 16.4 a 
II Vegetable products 9.2 548 115 1    432 11.6 a 
III Animal or vegetable fats and 
oils 2.8 125 75     50 7.0 a 
IV Prepared foods etc. 18.3 804 35     769 19.2 a 
V Minerals 1.9 239 9 225  4 1   
VI Chemicals and chemical 
products 2.0 1,170 15 1,083 1 3 8 60 1.8 
VII Plastics and rubber 4.1 302 44 253   5   
VIII Hides and skins 5.8 150 1 128   4 17 1.0 
IX Wood and articles 3.0 216  202  7 7   
X Pulp, paper etc. 4.2 210 2 191   17   
XI Textiles and textiles article s 5.4 1,170 41 1,059   67 3 1.0 
XII Footwear, headgear 5.6 110 1 100  5 4   
XIII Articles of stone 4.9 257  243   14   
XIV Precious stones, etc. 4.4 63  63      
XV Base metals and base 
metals products 5.3 1,004 36 884  3 81   
XVI Machinery 2.7 1,432 3 1,413  3 13   
XVII Transport equipment 2.2 300 41 248  8 3   
XVIII Precision equipment 2.2 341  341      
XIX Arms and ammunition 25.0 27  27      
XX Misc. manufactured articles 8.8 218 1 204   13   
XXI Works of art, etc. 5.0 7  7      
Total 6.3 9,482 459 6,672 1 33 237 2,080 15.6 
 
a combination of ad valorem  and specific duties 
 
Note: For tariff lines subject to TRQs only the out-of-quota duty  is included in the tariff-rela ted calculations;  for preferen tial tariffs with 
specific duties, the ad valorem  equivalent provided by Monteneg ro was included in the calculati on of the tariff averages.   
Based on the HS 2007 nomenclature. 
 
Source:  WTO estimates based on data provided by Montenegro. 
 
27. Chart II.4 compares the average preferential du ties for lines remaining subject to duty under 
the Agreement and corresponding overall average ta riff rates by HS Chapter.  For agricultural 
products (HS Chapters 1-24), the rates are the same , indicating that no preferential liberalization has 
taken place with respect to these products under the Ag reement;  apricots are subject to a tariff rate 
quota.  The same situation applies to non-agricultura l products in HS Chapters 29, 33, 35, 38, 41 and 
50.  The highest average rate for agricultural produ cts applies to HS Chapter 22 (beverages, spirits 
and vinegar) (32.8%) and, for non-agricultural prod ucts, to HS Chapter 35 (albuminoidal substances, 
starches, glues, enzymes) (2.5%).   WT/REG282/1 
 Page 13 
 
 
  0510152025303540
01
02
03
04
06
0708
09
10
11
1516
17
18
19
2021
22
23
240510152025303540
29
33
35
384150Chart II.4
Montenegro: Average of dutiable rates, by HS Chapter
HS  01-24 HS 25-97Average rate of duty (%)  
Average rate of duty (%)  
HS Chapter HS Chapter
Applied rates = Preferential
Note: For tariff lines with specific duties, the ad valorem equivalent provided by Montenegro are included in the calculation.
Source:  WTO Secretariat estimates, based on data provided by Montenegro. 
5. Tariff Rate Quotas  
28. Under Protocol I, the Parties apply TRQs for b ilateral imports of certain agricultural products 
as indicated in Table II.4 below.  In the case of M ontenegro, imports of Turkish dried apricots enjoy 
duty-free treatment within a quota of 100 tonnes. ] 
29. As for Turkey, in-quota imports of jam, fruit jellies, marmalades, etc. enjoy a preferential 
duty of 30% (compared to the MFN rate of 58.5% in 2010); and wine of fresh grapes enjoy a 75% reduction in the applied MFN rate.  With respect to  imports of pasta from Montenegro, Turkey shall 
grant the same preferential treatment accorded to imports of pasta from the EU, for three tariff lines 
(HS 1902.20.10.00;  1902.20.30.10;  1902.20.30.90).  In 2010 the EU rate equals the MFN rate (37%).
7  For the rest of the tariff lines under the HS code 1902, Turkey’s MFN rates in 2010 ranged 
between 7.7% and 8.3% and 50.89 EUR/100 kg/net, wh ereas the rates applied to imports originating 
in the EU ranged between 0% and 11.37 EUR/100 kg/net.  
                                                      
7 Data submitted by Turkey to the WTO IDB (2010). WT/REG282/1 
Page 14  
 
  Table II.4 
TRQs on agricultural products under the Agreement 
Montenegro's imports from Turkey (Annex I)  
HS code Description TRQ volume Preferential duty Applied duty 2010 
0813.10 Dried apricots 100 tonnes duty-free 10% 
Turkey's imports from Montenegro (Annex II)  
HS code Description TRQ volume Preferential duty MFN 2010 
1902 Pasta, whether or not cooked or 
stuffed, or otherwise prepared 500 tonnes EU treatment -- 
2007 Jams, fruit jellies, marmalades, 
etc., cooked 300 tonnes 30%  58.5%-                     
0% for two lines of HS 
2007 
2204 Wine of fresh grapes  
(excluding grapes of heading 
2009) 2500 hl 25% of the MFN 70% -  
21.3% for five lines of 
HS 2204.30 
 
-- Combination of ad valorem  and compound duties. 
Source:  Protocol I of the Agreement.  
30. The Agreement does not provide details on whethe r the TRQs are to be phased out over time 
or if the in-quota rates are to be reduced.  Howe ver, under Article 10.2 of the Agreement, there is 
provision for further liberalization for these or othe r agricultural products in the future.  Turkey does 
not have TRQs at the multilateral level.  
B. RULES OF ORIGIN  
31. Rules of origin are laid down in Article 22 an d Protocol II.  Under Article 22, the Parties 
agreed to apply the European preferential rules of or igin in their bilateral trade, including all existing 
and future amendments.  The Joint Committ ee shall initiate the amendment process.   
32. Protocol II provides for the definition of originating products and the methods of 
administrative cooperation.  The following products  are considered as originating in the Parties 
(Article 2 of Protocol II): 
(a) products wholly obtained in a Party's territory;8  or 
(b) products obtained in a Party's territory incorporating non-originating materials 
provided that they have undergone suffic ient working or processing in any of the 
Parties' territory, in accordance with Article 6. 
                                                      
8 Article 5 defines the following products as "wholly obtained" in Turkey or Montenegro:  i) mineral 
products extracted from their soil or seabed;  ii) vegetabl e products harvested therein;  iii) live animals born and 
raised therein and their derived products;  iii) products  obtained by hunting or fishing conducted therein;  
iv) products of sea fishing and other products taken from the sea outside the Parties' territorial waters by their 
vessels;  v) products made aboard their factory ships exclusively from products referred to in paragraph iv);  vi)used articles collected therein fit only for the recovery of raw materials, including used tyres fit only for 
retreading or for use as waste;  vii) waste and scrap resulting from manufacturing operations conducted therein;  
viii) products extracted from marine soil or subsoil outsid e their territorial waters provided that they have sole 
rights to work that soil or subsoil;  and ix) goods produced therein exclusively from products specified in 
paragraphs i) to viii).  The terms "vessels" and "factor y ships" mean vessels and factory ships that:  i) are 
registered or recorded in an y of the Party;  ii) sail under a Party's flag ;  iii) are owned, for at least 50%, by 
nationals of the Parties, or by a company with its head office in any of the Parties, of which the manager or 
managers, Chairman of the Board of Directors or the Supervisory Board and the majority of their members, are 
nationals of the Parties and of which, in the case of part nerships or limited companies, at least half of the capital 
belongs to the Parties or their public bodies or nationals.  In addition, the masters, officers and at least 75% of 
the crew must be nationals of the Parties.  WT/REG282/1 
 Page 15 
 
 
  33. Non-originating materials are considered to be  sufficiently worked or processed when they 
meet the conditions set out in Annex II to Protocol  II.  Article 6.1 specifies that once a product has 
acquired originating status by fulfilling this requireme nt and it is incorporated into another product, 
the latter is not subject to the same requirement and no account shall be taken of the non-originating 
materials used in its manufacture.  Article 6.2 provides for a de minimis rule with respect to 
non-originating materials used in the manufacture that do not satisfy the sufficiently worked or 
processed requirement, allowing their use when:  i)  their total value does not exceed 10% of the 
ex-works price of the product;  and ii) the maximu m value of non-originating materials (in Annex II) 
is not exceeded.  The de minimis rule does not apply to textiles and clothing (HS Chapters 50-63).  
Insufficient working or processing operations that do not confer originating status are listed in 
Article 7. 
34. Articles 3 and 4 of Protocol II provide for di agonal cumulation.  A product is considered as 
originating, for the purposes of the Agreement, if it is obtained in one of the Parties incorporating 
materials of any other country or territory par ticipating in the European Union Stabilization and 
Association process with the Western Balkan countri es or materials originating in the Community  
covered by Decision 1/95 of the EC-Turkey Association Council,9 provided that the working or 
processing carried out in the Parties goes beyond the oper ations listed in Article 7.  It is not necessary 
that such materials undergo sufficient working or  processing.  However, where the working or 
processing carried out in a Party does not go beyond the insufficient operations of Article 7, the 
product obtained shall be considered as originating only if the value added by that Party is greater 
than the value of the materials used.  If it is not the case, then the product obtained shall be considered 
as originating in the country or territory which acc ounts for the highest value of originating materials 
used in manufacturing in the Parties.  Products orig inating in one of the above mentioned countries or 
territories, which do not undergo any working or pr ocessing in the Parties, retain their origin if 
exported to one of these countries or territories.  
35. Cumulation under the Agreement may be applied only if:  i) a preferential trade agreement, in 
accordance with Article XXIV of the GATT, is a pplicable between the countries or territories 
involved in the acquisition of originating status an d the country of destination;  ii) materials and 
products have acquired originating status by the appli cation of rules identical to those in Protocol II of 
the Agreement;  and iii) notices of the fulfilment of all necessary requirements to apply cumulation 
have been officially published in the Parties accord ing to their own internal procedures.  Each Party 
shall provide the other with details of the agreemen ts, including their dates of entry into force, and 
corresponding rules of origin applied to the other Western Balkan countries.  Products listed in Annex 
V to Protocol II are excluded from diagonal cumulation, namely:  HS 1704.90.99 (other sugar confectionary, with or without cocoa);  HS 1806.10.30, 1806.10.90, 1806.20.95 (other food preparations containing sucrose or cocoa);  HS  1901.90.99 (malt extract containing cocoa);  
HS 2101.12.98, 2101.20.98 (other preparations with a basis of coffee, tea or mate):  HS 2106.90.98 
(food preparations, not elsewhere specified or include d);  and HS 3302.10.29 (mixtures of odoriferous 
substances for food or drink industries). 
36. Protocol II further contains provisions on the un it of qualification (Article 8);  accessories, 
spare parts and tools (Article 9);  sets (Article 10);  neutral elements (Article 11);  and products sent for exhibition (Article 14).  The principle of territori ality is set out in Article 12.  Article 13 provides 
for direct transportation of goods eligible for pref erential treatment between the Parties or through the 
territories of the other countries and territo ries referred to in Articles 3 and 4.   
                                                     
 
9 According to footnote 2 to Article 3 Decision 1/95 of the EC-Turkey Association Council, of 
22 December 1995, applied to products:  i) other than  agricultural products, as defined in the Agreement 
establishing an Association between the European Economic Community (ECC) and Turkey;  and ii) other than coal and steel products, as defined in the Agreement between the European Coal and Steel Community (ECSC) 
and the Republic of Turkey on trade in products covered by the Treaty establishing the ECSC.  WT/REG282/1 
Page 16  
 
  37. Article 15 prohibits the drawback of, or exemption from, customs duties of non-originating 
materials used in the production of originating go ods.  This prohibition does not apply to an export 
refund system for agricultural products (Article 15.5). 
38. In the Joint Declaration attached to Protocol  II, the Parties agreed to make the necessary 
amendments to the Protocol on rules of origin acco rding to Protocol 3 for the application of the 
provisions of the Stabilisation and Associati on Agreement between the European Union and 
Montenegro.   
Box II.2:  Rules of Origin:  Basic Features at a Glance 
• European preferential rules of origin.   
• Product specific criteria: 
-  Wholly obtained or entirely produced goods. 
-  Sufficient working or processing and value-added. 
• Diagonal cumulation. 
• De minimis rule:  non-originating materials can represent a maximum of 10% of the ex-work price of the 
product or any of the percentage given in Annex II for the maximum value of non-originating 
materials.  Not applicable to HS Chapters 50-63.    
• Transit through third parties authorized only under certain conditions. 
• Prohibition of drawback or exemption, except for export refund system for agricultural products. 
 
Source:  Protocol II of the Agreement. 
 
C. EXPORT DUTIES AND CHARGES , AND QUANTITATIVE RESTRICTIONS  
39. Articles 6 and 7, respectively prohibit the intr oduction of new customs duties and quantitative 
restrictions, or charges and measures having equivale nt effect, on exports by the Parties from the entry 
into force of the Agreement.  All existing custom s duties and quantitative restrictions on exports and 
charges and measures having equivalent effect were to  be abolished by the Parties on the date of the 
Agreement's entry into force.  
40. Products exported to the territory of the Par ties shall not qualify for refunds from internal 
indirect taxation which exceed the amount of the indi rect taxation directly or indirectly imposed on 
them (Article 14.2). 
D. REGULATORY PROVISIONS OF THE AGREEMENT  
1. Standards 
(a) Sanitary and phytosanitary measures 
41. The Parties shall apply their domestic regulati ons on veterinary, sanitary and phytosanitary 
control in accordance with the WTO Agreement on Sanitary and Phytosanitary Measures.  Their 
veterinary and phytosanitary control measures shall be harmonized with the EU's legislation.  The 
Parties may not introduce discriminatory or other measures that may unduly restrict the flow of information on the level of sanitary and phytosanit ary protection of animals, plants and products 
(Article 11).  
(b) Technical barriers to trade 
42. Article 8 states that the Parties' rights and obl igations on standards or technical regulations 
and related measures are governed by the WTO Agreement on Technical Barriers to Trade.  The Parties have undertaken to cooperate and excha nge information in standardization, metrology,  WT/REG282/1 
 Page 17 
 
 
  conformity assessment and accreditation with the aim of eliminating technical barriers to trade.  Upon 
request by a Party, the other Party must provide  information on particular individual cases of 
standards, technical rules or similar measures. 
2. Safeguard mechanisms 
(a) Global safeguards 
43. The Parties retain their rights and obliga tions under Article XIX of GATT 1994 and the 
WTO Agreement on Safeguards.  The Agreement does not confer additional rights or obligations on 
the Parties with respect to safeguard measures (Article 18). 
(b) Bilateral safeguards 
44. Article 16 allows Montenegro to take excepti onal measures of limited duration in derogation 
to its commitments under Article 4 for structural ad justment purposes.  These measures shall take the 
form of increased customs duties and only for  infant industries or sectors undergoing restructuring or 
facing serious difficulties, particularly when these difficulties produce important social problems.  The increased customs duties on imports from Turkey  may not exceed the 2010 applied rate for the 
product concerned and shall maintain an element of pr eference.  The value of imports subject to such 
exceptional measures may not exceed 15% of total im ports from Turkey of non-agricultural products 
in the latest year for which statistics are available (Article 16.2 and 3). 
45. The exceptional measures shall be applied for a maximum period of five years, unless a 
longer duration is authorized by the Joint Committee,  and they cannot be introduced for a product if 
more than three years have elapsed since the elim ination of duties and quantitative restrictions or 
charges or measures with equivalent effect  on that product (Article 16.4 and 5).   
46. Montenegro shall inform the Joint Committee of  any exceptional measures it intends to take.  
At the request of Turkey, consultations shall be held in the Joint Committe e with respect to the 
measures and sectors concerned before such measures are applied.  Montenegro is to provide the 
Joint Committee with a schedule for the eliminati on of increased duties, including their phasing-out 
starting at least two years after their introduction at equal rates.  The Joint Committee may decide on a 
different schedule (Article 16.6).  
47. Article 19 provides for the adoption by the exporting Party of measu res to remedy the 
following situations:  i) re-export to a third count ry against which the exporting Party maintains for 
the product concerned quantitative export restricti ons, export duties or measures with equivalent 
effect;  or ii) a serious shortage, or threat thereo f, of a product essential to the exporting Party, and 
where these situations give rise, or are likely to gi ve rise, to major difficulties for the exporting Party.  
The procedure for the adoption of appropriate measures is set forth in Article 21.  These measures 
shall be applied by the exporting Party in a non- discriminatory manner and be eliminated when 
conditions no longer justify their maintenance.   
48. Under Article 25, the Parties endeavour to avoi d, where possible, the imposition of restrictive 
measures, including measures on imports, for balance of payments purposes.  Where a Party adopts 
any such measure, it shall provide the other Part y, as soon as possible, w ith a timetable for its 
removal.  
49. Where any of the Parties is in serious bala nce of payments difficulties or under imminent 
threat thereof, it may, in accord ance with the WTO Agreement, adopt  restrictive measures, including 
on imports, that are of limited duratio n and do not go beyond what is strictly necessary to remedy the 
situation.  The Party applying the measure is to in form the other forthwith.  No restrictive measures WT/REG282/1 
Page 18  
 
  can be applied to transfers related to investment , and in particular to the repatriation of amounts 
invested or reinvested or any kind of revenues derived from them.   
(c) Special safeguard for agricultural products 
50. Article 12 states that, given the particular sens itivity of agricultural products, if imports of 
such products originating in a Party, which ar e subject to concessions under the Agreement, cause 
serious disturbance to the market or to the domestic regulatory mechanisms of the other Party, 
consultations shall immediately be held in order to find an appropriate solution.  Pending such a 
solution, the affected Party may take the necess ary measures in accordance with the relevant WTO 
rules (Article 12).  The implementation of Artic le 12 shall conform with the notification and 
consultation procedure established in Article 21. 
3. Anti-dumping and countervailing measures 
51. Article 17 specifies that no provisions of the Ag reement impede the Parties from taking trade 
defence actions.  When a Party finds that dumping and/or subsidisation is taking place in bilateral 
trade, it may take appropriate actions against this  practice in accordance with the WTO Agreement on 
Implementation of Article VI of GATT 1994, the WTO Agreement on Subsidies and Countervailing 
Measures and its relevant internal legislation.  
4. Subsidies and State-Aid 
52. When a Party finds that subsidizing practices are taking place in bilateral trade, it may take 
appropriate actions in accordance with the WTO Agreement on Subsidies and Countervailing 
Measures and its relevant intern al legislation (Article 17.2). 
5. Other regulations 
(a) Customs-related procedures 
53. To benefit from the Agreement, Protocol II requires, upon import of an originating product 
into any of the Parties' territory, the submission of :  i) a movement certificate EUR.1 by the exporting 
Party, whose format is in Annex III to the Protoc ol;  or ii) an invoice declaration by an approved 
exporter
10 or by an exporter for any consignment of one  or more packages wi th a value of up to 
€6,000 (Articles 16 and 22.1).  Produc ts listed in Article 27 shall be ex empted from the proof of origin 
in order to benefit from preferential treatment, na mely:  i) products sent as small packages between 
private persons whose value does not exceed €500; and ii) products forming part of travellers’ 
personal luggage whose value does not exceed €1,200, provided that they are not imported by way of 
trade. 
54. A proof of origin shall be valid for four mont hs from the date of issue in the exporting Party 
and must be submitted within the same period of time to the customs authorities of the importing 
Party, in accordance with its internal procedures (Art icles 24 and 25).  The exporter requiring either a 
movement certificate EUR.1 or an invoice declara tion must keep all appropriate documents proving 
the originating status of the produc ts concerned for at least three y ears.  The same obligation applies 
to the customs authorities of the importing Party (Article 29).  
55. Under Article 32, the Parties shall assist each  other in verifying the authenticity of the 
movement certificate and invoice declaration.  Verifi cations of proof of origin may be carried out 
randomly or whenever the importing Party's customs authorities have reasonable doubts about the 
                                                      
10 The definition of approved exporter is provided in Article 23.  WT/REG282/1 
 Page 19 
 
 
  authenticity of the documents.  The exporting Party h as the right to ask for an y evidence, to carry out 
any inspection of the exporter's accounts or any ot her verification as considered appropriate.  Where 
the importing Party's customs authorities decide to suspend preferential treatment while awaiting the 
results of the verification, the imported products  shall be released subject to any precautionary 
measures where necessary.  The results of the veri fication shall be communicated as soon as possible;  
in the event of no response within ten months of the verification request, or if the response fails to 
provide sufficient information to determine the authentic ity of the proof of origin or the product's real 
origin, the importing Party may refuse to grant preferential treatment (Article 33). 
56. Article 34 specifies that disputes relating to the verification of origin which cannot be 
resolved between the Parties' customs authorities or relating to the interpretation of Protocol II shall 
be submitted to the Joint Committee.  Disputes be tween the importer and the customs authorities of 
the importing Party shall be settled under its internal  legislation.  Penalties shall be imposed on any 
person who draws up, or causes to be drawn up, a document with incorrect information for the 
purpose of obtaining preferential treatment (Article 35).11   
(b) Services and Investment 
57. Under Chapter III, the Parties recognized the growing importance of services and investment 
and agreed to gradually develop and broaden thei r cooperation, in particular in the context of 
European integration, to promote investment and achieve progressive liberalization and mutual 
opening of their markets for investment and se rvices, also taking into account the relevant 
GATS provisions.  Discussions in this regard are to  take place in the Joint Committee (Article 13).   
According to the Parties there have not been  any developments in services and investment 
negotiations so far. 
(c) Transfers and payments 
58. Article 23 provides for payments relating to co mmercial transactions under the Agreement, 
and their transfer to the territory of the Party wh ere the creditor resides, to be made in freely 
convertible currencies and without restrictions.  No administrative restrictions, other than those in the 
Parties' existing legislation, shall be applied to  grant repayment or acceptance of short and medium 
term credits related to commercial transactions involving a resident of a Party.  Any measure related 
to payments connected with the movement of goods is  to conform with Article VIII of the Articles of 
Agreement of the International Monetary Fund.   
(d) Competition  
59. Article 24.1 lists the following practices as incomp atible with the Agreement, as far as they 
affect trade between the Parties:  i) all agreemen ts between undertakings, decisions by associations of 
undertakings and concerted practices which have as thei r object or effect the prevention, restriction or 
distortion of competition;  ii) abuse by one or more  undertakings of a dominant position in the whole, 
or a substantial part, of the Parties' territories;  iii) any concentration leading to a dominant position 
and preventing fair competition;  and iv) any state ai d which distorts or threaten to distort competition 
by favouring certain undertakings or the production of certain goods.   
60. If a Party considers that any of the above men tioned practices is incompatible with the terms 
of Article 24.1 and it is not adequate ly dealt with by the rules set out in paragraph 4, or in the absence 
of such rules, and if the practice causes or thr eatens to cause serious prejudice to the other Party's 
                                                      
11 Relevant provisions are found under Article 231-241 of the Turkish Customs Law (available at:  
http://www.gumruk.gov.tr/ENG/legislation/Documents /turkishcustomslaw.pdf) and Article 412 (Forged 
Documents) of the Criminal Law of Montenegro. WT/REG282/1 
Page 20  
 
  interests or material injury to its domestic i ndustry, including its services, that Party may take 
appropriate measures following cons ultations in the Joint Committee or after 30 working days from 
the referral for consultations (Article 24.3).  Article 24.4 specifies that in the case of abuse of dominant position (Article 24.1(c)), appropriate measures may only be adopted in conformity with the 
relevant EU rules and any other instrument ne gotiated under its auspices applicable between the 
Parties.  
61. To ensure transparency in State aid, each Party shall, upon request by the other, provide 
information on particular individual cases of State aid (Article 24.2). 
62. With respect to investigation procedures, the investigating Party may request the other to 
cooperate and provide information on official doc uments relevant to the investigation, and the 
requested Party shall do its best to provide such in formation in a timely manner through its competent 
government agencies (Article 24.5).  In exchanging info rmation, the Parties shall take into account the 
limitations imposed by professional and business secrecy (Article 24.6).  
E. S
ECTOR -SPECIFIC PROVISIONS OF THE AGREEMENT  
63. There are no sector-specific provisions in the Agreement. 
IV. GENERAL PROVISIONS OF THE AGREEMENT 
A. TRANSPARENCY  
64. The Agreement does not include provisions on transparency. 
B. EXCEPTIONS  
65. General exceptions to the Agreement's provisions , in line with Article XX of the GATT, are 
contained in Article 31, provided that they do not  constitute a means of arbitrary discrimination or 
disguised restriction on trade between the Parties.   
66. Security exceptions are listed in Article 30, in cluding the disclosure of information contrary 
to a Party's essential security interests and the impl ementation of internationa l obligations or national 
policies.   
C. ACCESSION AND WITHDRAWAL  
67. No provisions on accession by third countr ies are foreseen in the Agreement. 
68. The Agreement has an unlimited duration.  Each Party may withdraw from it through a 
written notification to the other Party, and terminatio n shall take effect on the first day of the seventh 
month following the date of receipt of the notificati on by the other Party.  In the case of accession by 
any of the Parties to the EU, the Agreement is to terminated on the day before the date of accession 
(Article 36). 
69. Article 33 provides for an "evolutionary clause" to extend the scope of the Agreement to areas 
not covered.  If a Party considers this to be useful, it should make a request to the other Party.  If in 
agreement, the Parties may direct the Joint Comm ittee to examine the request and where appropriate 
make recommendations especially to commence nego tiations.  Any agreement resulting from this 
recommendation would need to be ratified or ap proved by the Parties in  accordance with their 
respective national legislation.  WT/REG282/1 
 Page 21 
 
 
  D. INSTITUTIONAL FRAMEWORK  
70. Article 28 establishes the Joint Committee, whic h includes representatives of the Parties and 
is responsible for the administration and proper impl ementation of the Agreement.  The Parties shall 
exchange information and, upon request, hold consu ltations within the Joint Committee.  The Joint 
Committee shall:  i) review the possibility of further re moval of obstacles to trade;  ii) take decisions 
in the cases provided for by the Agreement;  and iii) make recommendations on any other matters.  
71. It shall convene at least once a year or whenev er necessary upon request by either Party.  It 
shall act by consensus.  Where a representative of a Party has accepted a decision subject to the 
fulfilment of internal legal requirements, the decisi on shall enter into force on the date of receipt of 
the written notification stating that such requirements have been fulfilled, if no later date is indicated 
in the decision.  The Joint Comm ittee shall adopt its own rules of procedure and decide to set up 
sub-committees and working groups as it considers necessary (Article 29).  Although already 
established, according to the Parties th e Joint Committee has not yet met.   
E. DISPUTE SETTLEMENT  
72. Under Article 32, the Parties have committed to  take all necessary measures to ensure the 
achievement of the Agreement's objectives and the fulf ilment of their obligations.  If a Party considers 
that the other has failed to fulfil an obligation unde r the Agreement, it may take appropriate measures 
in accordance with Article 21. 
73. Article 21 sets out the notification and consu ltation procedure for the implementation of 
Articles 12 (specific safeguards fo r agricultural products), 19 (re -export and serious shortage), 
24 (rules of competition) and 32 (fulfilment of obliga tions).  Before taking any such a measure, the 
Parties shall endeavour to resolve any differences between them through direct consultations.  The 
Party applying the measure shall promptly notify the Joint Committee and provide all the relevant 
information and the assistance required to examine the case.  If within one month from referral to the 
Joint Committee, the Party fails to terminate the pr actice objected to or the difficulties notified, and in 
the absence of a decision by the Joint Committee, the Party may adopt the necessary measures to 
remedy the situation. 
74. The measures shall be immediately notified to th e Joint Committee.  They shall be limited, in 
their extent and duration, to what is strictly n ecessary to remedy the situation and shall not be in 
excess of the damage caused, giving priority to tho se measures that least disturb the functioning of the 
Agreement.  The measures shall be subject to re gular consultations in the Joint Committee with a 
view to their relaxation or abolition where c onditions no longer justify their maintenance.  
75. In case of exceptional circumstances requiring immediate action, Article 21.6 allows the 
Parties to apply precautionary measures without prio r examination, provided that they are strictly 
necessary to rectify the situation.  Precautionary measures shall be notified to the Joint Committee 
without delay and be subject to c onsultations between the Parties. 
F. RELATIONSHIP WITH OTHER AGREEMENTS CONCLUDED BY THE PARTIES  
76. The Agreement does not prevent the maintena nce or establishment of customs unions, free 
trade areas or arrangements for cross-border trade by  the Parties with third countries, provided that 
these do not negatively affect the bilateral trade regime  and, in particular, the regime of origin under 
the Agreement.  Upon request by either Party, an exchange of information about agreements 
establishing customs unions or free trade areas shall take place in the Joint Committee (Article 15). WT/REG282/1 
Page 22  
 
  77. Table III.1 shows the Parties' participation in other RTAs, notified and non-notified in force, 
as of December 2010.  Turkey has a customs union  agreement with the EU, a free-trade agreement 
with EFTA and 12 bilateral agreements in force, mainly with East European and Mediterranean 
countries since it is also part of the Euro-Mediterranean Partnership.   
G. G
OVERNMENT PROCUREMENT  
78. The Parties shall progressively reform any state monopoly of a commercial character so as to 
ensure that, by the end of the fourth year after the entry into force of the Agreement (i.e. 2014), no 
discrimination exists regarding the conditions unde r which goods are procured and marketed between 
nationals of the Parties.  The Joint Committee is  to be informed of any measures adopted to 
implement this objective (Article 20). 
79. The liberalization of the Parties' procurement ma rkets is considered as one of the objectives of 
the Agreement, with the aim of awarding public  contracts on a non-discriminatory and reciprocal 
basis (Article 27).  The Parties agreed to progr essively develop their own rules, conditions and 
practices on public procurement to grant their respective suppliers access to contract award 
procedures in their markets on conditions not less fa vourable than those accorded to companies of any 
other country or territory.  The Joint Committee  shall examine developments related to the 
implementation of Article 27 and recommend practical  modalities to ensure free access, transparency 
and mutual opening of the Parties' procurement ma rkets.  In particular, the Joint Committee may 
consider, in light of internationa l developments and regul ations in  public procurement, the possibility 
of extending the coverage and/or the degree of liber alization provided by the Agreement.  The Parties 
shall also endeavour to accede to the relevant Agreements being negotiated under the auspices of 
GATT 1994 and the WTO.   
H. INTELLECTUAL PROPERTY  
80. Under Article 26, the Parties shall grant and ensure adequate, effective and non-
discriminatory protection of intellectual property rights (IPRs) and the enforcement of such rights 
against infringement, counterfeiting and piracy, in  accordance with the Agreement and relevant 
international agreements.  The Parties accord to each other's nationals na tional and MFN treatment;  
these obligations may be derogated from in accord ance with Articles 3, 4 and 5 of the TRIPS 
Agreement.   
81. The implementation of Article 26 is  to be regularly reviewed by the Parties.  In the event of 
any problem in the area of IP that may affect bila teral trade, upon request by either Party, urgent 
consultations shall be held to reach  a mutually satisfactory solution. 
 
  WT/REG282/1 
 Page 23 
 
 
  Table III.1 
Turkey and Montenegro:  Participat ion in other RTAs (notified and no n-notified in force), as April 2011  
GATT/WTO Notification 
Partner /Agreement Date of entry  
into force Type of 
agreement Year WTO Provision 
TURKEY  
Jordan 01.03.11 Goods 2011 GATT Art. XXIV 
Chile 01.03.11 Goods 2011 GATT Art. XXIV 
Serbia 01.09.10 Goods 2010 GATT Art. XXIV 
Georgia 01.11.08 Goods 2009 GATT Art. XXIV 
Albania 01.05.08 Goods 2008 GATT Art. XXIV 
Egypt 01.03.07 Goods 2007 Enabling Clause 
Syria 01.01.07 Goods 2007 GATT Art. XXIV 
Morocco 01.01.06 Goods 2006 GATT Art. XXIV 
Tunisia 01.07.05 Goods 2005 GATT Art. XXIV 
Palestinian Authority 01.06.05 Goods 2005 GATT Art. XXIV 
Bosnia and Herzegovina 01.07. 03 Goods 2003 GATT Art. XXIV 
Croatia 01.07.03 Goods 2003 GATT Art. XXIV 
FYROM 01.09.00 Goods 2001 GATT Art. XXIV 
Israel 01.05.97 Goods 1998 GATT Art. XXIV 
European Union 01.01.96 Goods 1995 GATT Art. XXIV 
EFTA 01.04.92 Goods 1992 GATT Art. XXIV 
ECO 17.02.92 Goods 1992 Enabling Clause 
PTN 11.02.73 Goods 1971 Enabling Clause 
MONTENEGRO  
European Union 01.05.10 
01.01.08 Services 
Goods 2010 
2008 GATT Art. XXIV & 
GATS Art. V 
CEFTA 01.05.07 Goods 2007 GATT Art. XXIV 
Source: WTO Secretariat. 
 
FYROM: Former Yugoslav Republic Of Macedonia 
EFTA: European Free Trade Area 
ECO: Economic Cooperation Organization 
PTN: Protocol relating to Trade Ne gotiations among deve loping countries 
CEFTA: Central European Free Trade Agreement (2006) WT/REG282/1 
Page 24  
 
  ANNEX I 
 
Indicators of trade liberalization under the Agreement
 
  
1. A comparison between the scheduled elimination of tariffs applied to the Parties' mutual 
imports and their overall duties is shown in Tables AI .1 (Turkey) and AI.2 (Montenegro) according to 
agricultural, non-agricultural and total products.  Ov erall applied duties in 2010 serve as a basis for 
the comparison. 
Table AI.1 
Turkey: Indicators of MFN tariff rates and pr eferential rates for imports from Montenegro 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2010 13.7 17.9 23.4 50.1 57.2 12.4 5.7 7.7 25.9 
Montenegro 2010 10.6 56.5 81.2 50.1 57.5 12.9 1.9 51.2 96.3 
 a WTO Definition. Note: Tariff lines subject to in-quota rates are excluded in the computation; for the calculation of averages, specific rates a re excluded 
and the ad valorem  part of alternate rates are included. 
Based on the HS 2007 nomenclature. 
 
Source : WTO Secretariat estimates based on data provided by Turkey. 
 
2. In 2010, Turkey's average applied MFN rate was 13.7% on all products, with 23.4% of lines 
being duty free.  The average applied tariff on ag ricultural products was 50.1%, almost tenfold the 
tariff on non-agricultural products 5.7%.  The share of duty-free lines in agriculture and 
non-agriculture was 12.4% and 25.9%, respectively.  Upon entry into force of the Agreement, the share of duty-free lines for imports from Montenegro  increased to 81.2%, w ith an average applied 
tariff of 10.6%.  There was limited liberalization in  agricultural products under the Agreement, with 
the share of duty-free lines increasing by 0.5% and the average applied tariff remaining unchanged.  
On non-agricultural products, Montenegrin exporters enjoyed an absolute margin of preference of 
3.8% vis-à-vis  the corresponding MFN rates, and the sh are of duty-free lines increased to 96.3%. 
Table AI.2 
Montenegro: Indicators of MFN tariff rates and preferential ra tes for imports from Turkey 
ALL PRODUCTS Agricultural products a Non-agricultural products 
Average applied 
tariff Average applied 
tariff Average applied 
tariff Origin of 
goods Year 
Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff 
lines (%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) Overall 
(%) On 
dutiable 
(%) Share of 
duty-free 
tariff lines 
(%) 
MFN 2010 6.3 6.6 4.8 14.2 16.7 14.0 4.3 4.4 2.3 
Turkey 2010 3.5 14.7 75.2 14.2 16.9 14.8 0.8 9.4 91.4 
 2011 3.5 14.5 75.2 14.2 16.9 14.8 0.7 8.7 91.4 
 2012 3.4 14.4 75.2 14.2 16.9 14.8 0.7 8.0 91.4 
 2013 3.4 14.4 75.6 14.2 16.9 14.8 0.6 7.7 91.9 
 2014 3.3 14.1 75.6 14.2 16.9 14.8 0.6 6.9 91.9 
 2015 3.3 15.6 78.1 14.2 16.9 14.8 0.5 9.9 95.0 
 
a WTO Definition. 
 
Note: For tariff lines subject to TRQs only the out-of-quota duty  is included in the tariff-rela ted  calculations; for preferen tial tariffs with 
specific duties, the ad valorem  equivalent provided by Monteneg ro was included in the calculati on of the tariff averages.   
Based on HS 2007 nomenclature.  
Source : WTO Secretariat estimates based on data provided by Montenegro. 
 
  WT/REG282/1 
 Page 25 
 
 
  3. In 2010, Montenegro's share of duty-free lines acco unted for 4.8% of the total.  The overall 
average applied rate was 6.3%;  for agricultu ral products, it was 14.2% and for non-agricultural 
products 4.3%.  Upon entry into force of the Ag reement, the share of duty-free lines increased to 
75.2%.  Turkish exporters enjoyed an absolute margin  of preference of 2.8% on all products and 3.5% 
on non-agricultural products.  There was limited liberalization in agricultural products under the 
Agreement, with the share of duty-free lines in creasing by 0.8% and the average applied tariff 
remaining unchanged.  By the end of the implementation period, in 2015, the share of duty-free lines will account for 78.1% of the total, with an aver age applied rate for all products of 3.3%.  For 
non-agricultural products, the share of duty-free lines w ill increase to 95%, with a final applied rate of 
0.5%. 
Table AI.3 – Turkey: Market access opportunities u nder the agreement for Mont enegro's top 25 exports 
Access Conditions to Turkey's import markets  Montenegro's top export products in 2006-2008  MFN (2010)  
HS number and description of the product  Share in 
global exports 
(%) Average 
MFN 
applied 
rate 
(%) Duty-
free Dutiable Duty-free 
upon 
entry 
into force 
(2010) Remain 
Dutiable
760110 - Aluminium, not alloyed 46.8 3.0  1 1  
721499 -- Other 4.5 15.0  8 8  
220421 -- In containers holding 2 l or less 4.4 70.0  57  57 
721391 -- Of circular cross-section measuring less 
than 14 mm in diameter 3.7 12.0  7 7  
722490 - Other 3.0 7.5 2 7 7  
730630 - Other, welded, of circular cross-section, of 
iron or non-alloy steel 2.4 0.0 14    
440710 - Coniferous 2.3 0.0 9    
722410 - Ingots and other primary forms 2.1 3.0  2 2  
300490 - Other 2.0 0.0 12    
271011 -- Light oils and preparations 1.3 4.7  12 12  
740400 Copper waste and scrap. 1.3 0.0 3    
220300 Beer made from malt. 1.3 0.0 3    
848330 - Bearing housings, not incorporating ball or 
roller bearings; plain shaft bearings 0.9 2.1 3 3 3  
440792 -- Of beech (Fagus spp.) 0.7 0.0 2    
270210 - Lignite, whether or not pulverised, but not 
agglomerated 0.7 0.0 1    
720449 -- Other 0.7 0.0 3    
846221 -- Numerically controlled 0.6 2.7  2 2  
260600 Aluminium ores and concentrates. 0.6 0.0 1    
760120 - Aluminium alloys 0.6 6.0  3 3  
730890 - Other 0.6 0.0 4    
760200 Aluminium waste and scrap. 0.5 0.0 3    
721420 - Containing indentations, ribs, grooves or 
other deformations produced during the rolling process or twisted after rolling 0.5 15.0  1 1  
841830 - Freezers of the chest type, not exceeding 
800 l capacity 0.5 2.2  2 2  
271019 -- Other 0.5 3.8  25 25  
160249 -- Other, including mixtures 0.5 121.5  7  7 
Total of above 82.9  60 137 73 64 
 
Source : WTO estimates based on data provided by  Turkey and Montenegrin authorities. 
 
4. Table AI.3 shows market access conditions in Turkey for Montenegro's top 25 exports, which 
in 2006-08 accounted for a considerable share of its  global exports (82.9%).  Before the entry into 
force of the Agreement, 60 lines were duty-free on an MFN basis and 137 were dutiable.  Of the 
dutiable lines, 73 were liberalized upon entry into fo rce of the Agreement, half of which concerned 
other petroleum oils (HS 271019) and  light oil and preparations (HS 271011).  Sixty-four lines 
remain subject to duties under the Agreement. near ly all of which (57) relate to other wines 
(HS 220421). WT/REG282/1 
Page 26  
 
  Table AI.4 –Montenegro: Market access opportuniti es under the agreement for Turkey's top 25 exports 
Access Conditions to Montenegro's import markets 
MFN (2010) Turkey's top export products in 2007-2009 Number of tariff 
lines Duty-free in 
HS number and description of the product  Share in global 
exports (%)  Avg. 
applied 
rate 
(%) Duty-
free Dutiable  
2010 
2013 
2015 
Remain Dutiable 
721420 - Containing indentations, ribs, 
grooves or other deformations 
produced during the rolling process or twisted after rolling 5.0 18.0  1   1  
271019 -- Other 3.0 1.3 5 24 24    
870421 -- g.v.w. not exceeding 5 tonnes 3.0 2.6  5 5    
710812 -- Other unwrought forms 2.7 3.0  1 1    
610910 - Of cotton 1.9 10.0  1 1    
852872 -- Other, colour 1.7 3.0  11 11    
870331 -- Of a cylinder capacity not 
exceeding 1,500 cc 1.6 5.0 1 3 3    
870323 -- Of a cylinder capacity exceeding 
1,500 cc but not exceeding 3,000 cc 1.6 4.2 1 4 2 2   
271011 -- Light oils and preparations 1.5 2.5  13 13    
870322 -- Of a cylinder capacity exceeding 
1,000 cc but not exceeding 1,500 cc 1.5 4.5 1 3 1 2   
870332 -- Of a cylinder capacity exceeding 
1,500 cc but not exceeding 2,500 cc 1.3 3.8 1 4 2 2   
711319 -- Of other precious metal, whether 
or not plated or clad with precious 
metal 1.2 20.0  1 1    
870210 - With compression-ignition internal 
combustion piston engine (diesel or 
semi-diesel) 1.1 3.0  4 4    
620462 -- Of cotton 1.0 10.0  7 7    
890120 - Tankers 1.0 2.5 1 1 1    
840999 -- Other 0.9 1.0  1 1    
620342 -- Of cotton 0.9 10.0  7 7    
720711 -- Of rectangular (including square) 
cross-section, the width measuring 
less than twice the thickness 0.8 5.5  4 3  1  
854449 -- Other 0.8 1.0  5 5    
080222 -- Shelled 0.7 7.5  2    2 
611020 - Of cotton 0.7 10.0  3 3    
252329 -- Other 0.6 5.0  1  1   
841821 -- Compression-type 0.6 6.4  5 3  2  
870899 -- Other 0.6 1.0  3 3    
730890 - Other 0.6 3.3 1 3 3    
Total of above  36.4  11 117 104 7 4 2 
         
 
Note: Based on HS 2007 nomenclature. 
 
Source : WTO estimates based on data provided by Montenegro and UNSD, Comtrade database. 
 
5. Table AI.4 shows market access opportunities in  Montenegro for Turkey's top 25 exports, 
which in 2006-08 accounted for 36.4% of its global e xports.  Before the entry into force of the 
Agreement, 11 lines were duty-free and 117 retained duties.  In 2010, almost all lines (104) were 
liberalized as a result of the Ag reement;  a further seven lines are to become duty-free in 2013 and 
four lines in 2015.  Two lines remain dutiable u nder the Agreement and relate to shelled nuts 
(HS 080222). 
__________