# EUR-Lex - 52014PC0585 - EN

*|*

# 52014PC0585

**Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the tariff treatment for goods originating from Ecuador /* COM/2014/0585 final - 2014/0287 (COD) */**

			*

			*

EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

On 17 July 2014 the negotiations were
concluded with Ecuador for its accession to the Trade Agreement concluded
between the EU and Colombia/Peru. As a result of these negotiations, a Protocol
of Accession by Ecuador to the Agreement (hereinafter “the Protocol of
Accession") was initialled on [...].

In order to avoid unnecessary trade
disruption pending the completion of the procedures for the approval and
application of the Protocol of Accession, it is necessary to ensure that customs
duties applied on the date of initialling of the Protocol of Accession are not
increased and that no new customs duties are applied on products originating in
Ecuador. To this end, the proposed Regulation provides for the maintenance of
the level of duty rates that were applicable to Ecuador on the date of
initialling of the Protocol of Accession.

This Regulation will apply as of 1 January
2015 and until six months after the Protocol of Accession enters into force (or,
where appropriate, is applied provisionally), or until 31 December 2016,
whichever occurs first. This duration is necessary to provide for sufficient
time to carry out all the necessary internal procedures in the EU, but also in Ecuador, for the application of the Protocol of Accession. Additional delays could be
incurred due to the necessary consultation and approval of the Protocol of
Accession by Colombia and Peru prior to the Commission decision on the proposal
for the Council Decisions on signature and provisional application and on
conclusion of the Protocol of Accession. The potential six month overlap of
this Regulation and of the application of the Protocol of Accession is deemed
necessary to enable the economic operators to adjust to the new customs procedures.

2.           RESULTS OF CONSULTATIONS
WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS

Not applicable.

3.           LEGAL ELEMENTS OF THE
PROPOSAL

The legal basis for the proposal is
Article 207(2) of the Treaty on the Functioning of the European Union.

4.           BUDGETARY IMPLICATION

The proposed Regulation maintains the
current market access arrangements and in this sense does not have any
additional financial implications for the EU budget. The absence of its
application would, however, entail a potential increase in the customs revenue
collection.

The amount of this customs revenue
collection is difficult to predict, but would in any case be relatively small.
The duty savings incurred by current market access regime enjoyed by Ecuador
and which lapses on 1 January 2015 are in the range of €215 million (based on
2013 trade figures). Ecuador's exports to the EU are highly concentrated and
95% of these savings come from exporting essentially 5 product groups with an
average customs duty of 16%. Therefore, applying the erga omnes duties
for these products would significantly reduce their exports to the EU, thus
further reducing the actual impact on the EU budget.

2014/0287 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL

on the tariff treatment for goods
originating from Ecuador

THE EUROPEAN PARLIAMENT AND THE
COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the
Functioning of the European Union, and in particular Article 207(2) thereof,

Having regard to the proposal from the
European Commission,

After transmission of the draft legislative
act to the national Parliaments,

Acting in accordance with the ordinary
legislative procedure,

Whereas:

(1)       The Trade Agreement
between the European Union and its Member States, of the one part, and Colombia
and Peru, of the other part (hereinafter “the Agreement”) signed on 26 June
2012, provides in its Article 329 for the possible accession to the Agreement of
other Member Countries of the Andean Community.

(2)       Following the request by Ecuador to restart the negotiations with the Union to become a Party to the Agreement, negotiations
were conducted between the Union and Ecuador in 2014. As a result of those negotiations,
a Protocol of Accession by Ecuador to the Agreement (hereinafter “the Protocol
of Accession”) was initialled on [...].

(3)       Following the initialling
of the Protocol of Accession, an interim reciprocal arrangement is necessary
for the establishment of a free-trade area with Ecuador in order to avoid
unnecessary trade disruption. Therefore, as from 1 January 2015, customs duties
applied on the date of initialling of the Protocol of Accession are not increased
nor new customs duties applied on products originating in Ecuador.

(4)       This Regulation therefore
provides for the maintenance of the level of duty rates applicable to Ecuador on [date of initialling of the Protocol of Accession] as from 1 January 2015.

(5)       This measure is without
prejudice to measures taken under Council Regulations (EC) Nos 597/2009[1], 1225/2009[2] or 260/2009[3].

(6)       As a condition for the
application of the tariff treatment granted under this Regulation, Ecuador
should abstain from introducing new duties or charges having equivalent effect
or new quantitative restrictions or measures having equivalent effect for
imports originating in the Union, or from increasing existing levels of duties
or charges or from introducing any other restrictions from [the date of
initialling of the Protocol of Accession].

(7)       To ensure that Ecuador maintains its commitment to core international conventions on human and labour
rights, environmental protection and good governance, the application of this
measure should be subject to the continued and effective implementation of
those conventions.

(8)       In order to prevent any
risk of fraud, the entitlement to benefit from the tariff treatment provided
under this Regulation should be conditional on compliance by Ecuador with the relevant rules of origin of products and the procedures related thereto.

(9)       It is necessary to provide
for the application of Common Customs Tariff duties for any products originating
in Ecuador which cause, or threaten to cause, serious difficulties to Union
producers of like or directly competing products, subject to an investigation
by the Commission.

(10)     In the event of failure to
comply with any of the conditions laid down in this Regulation, implementing
powers should be conferred on the Commission to suspend temporarily in whole or
in part the tariff treatment provided therein. Those powers should be exercised
in accordance with Regulation (EU) No 182/2011 of the European Parliament and
the Council[4].

(11)     This Regulation is to be
applied until six months after the entry into force or date of provisional
application of the relevant provisions of the Protocol of Accession, and until
31 December 2016 at the latest,

HAVE ADOPTED THIS REGULATION:

Article 1

Definitions

For the purposes of this Regulation:

(a)          ‘tariff treatment’ means the duty
rate and treatment applied on goods originating in Ecuador as provided for by Article
2 ;

(b)          ‘Common Customs Tariff duties’
means the duties specified in Part Two of Annex I to Council Regulation (EEC)
No 2658/87[5], as amended, except those duties established as part of tariff
quotas;

(c)          ‘product(s) originating in
Ecuador’ means product(s) that conform(s) to the origin requirements under Title
II, Chapter 2 of Council Regulation (EEC) No 2913/92[6]
and, depending on the tariff treatment sought pursuant to the provisions of
Article 2, Title IV, Chapter 1 or Section 1 of Chapter 2 of Commission
Regulation (EEC) No 2454/93[7].

Article 2

Tariff treatment

1.           Customs duties applied on
products originating in Ecuador on [date of initialling of the Protocol] shall
not be increased and no new customs duties introduced after that date shall be applied
on those products.

2.           The tariff treatment provided
for in paragraph 1 shall be applied without prejudice to any measures taken
under Regulations (EC) Nos 597/2009, 1225/2009 or 260/2009.

Article 3

Conditions for
entitlement to the tariff treatment

Entitlement to benefit from tariff treatment defined in Article 2 shall
be subject to:

(a)          compliance with the rules of
origin referred to in Article 1(c) and the procedures related thereto,
including, as appropriate, effective administrative cooperation provisions applicable
on [date of initialling of the Protocol of Accession];

(b)          abstention by Ecuador from
introducing new duties or charges having equivalent effect and new quantitative
restrictions or measures having equivalent effect for imports from the Union,
or from increasing existing levels of duties or charges or from introducing any
other restrictions from [the date of initialling of the Protocol of Accession];

(c)          maintaining the ratification and
effective implementation on the part of Ecuador of the covenants, conventions
and protocols listed in the Annex to this Regulation, and accepting without
reservation the reporting requirements, regular monitoring and review of its
implementation record in accordance with the provisions of the covenants,
conventions and protocols it has ratified;

(d)          cooperating with the European
Commission and providing all information necessary to assess the respect by Ecuador of the requirements in paragraph (c);

(e)          Ecuador conducting continuous
efforts to sign and ratify the Protocol of Accession to the Trade Agreement between the European Union and its Member States, of
the one part, and Colombia and Peru, of the other part.

Article 4

Temporary suspension

Where it finds that there is sufficient evidence of failure to
comply with the conditions set out in Article 3, the Commission may adopt
implementing acts in order to suspend tariff treatment temporarily, in respect
of all or of certain products originating in Ecuador. Those implementing acts
shall be adopted in accordance with the examination procedure referred to in
Article 6(2).

Article
5

Safeguard clause

Where a product originating in Ecuador is
imported in volumes and/or at prices which cause, or threaten to cause, serious
difficulties to Union producers of like or directly competing products, the
Common Customs Tariff duties for that product may be reintroduced following the
procedural rules laid down in Regulation (EU) No 19/2013 of the European
Parliament and of the Council[8],
mutatis mutandis.

Article 6

Committee
procedure

1.           For the implementation of
Article 4 of this Regulation, the Commission shall be assisted by the Customs
Code Committee established by Article 248a of Council Regulation (EEC) No
2913/92. That committee shall be a committee within the meaning of Regulation
(EU) No 182/2011.

2.           Where a reference is made
to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.

Article 7

Entry
into force, application and expiry

1.           This Regulation shall
enter into force on the day following that of its publication in the Official
Journal of the European Union.

2.           This Regulation shall
apply from 1 January 2015.

3.           This Regulation shall
expire six months after the Protocol of Accession enters into force or, where
appropriate, is applied provisionally, or on 31 December 2016, whichever occurs
first. The Commission shall publish in the Official Journal of the European
Union a notice in the event that this Regulation ceases to apply before 31
December 2016.

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament                        For
the Council

The President                                                 The
President

[1]               Council Regulation (EC) No 597/2009 of 11 June 2009
on protection against subsidised imports from countries not members of the
European Community (OJ L 188, 18.07.2009, p .93).

[2]               Council Regulation (EC) No 1225/2009 of 30 November
2009 on protection against dumped imports from countries not members of the
European Community (OJ L 343, 22.12.2009, p. 51).

[3]               Council Regulation (EC) No 260/2009 of 26 February
2009 on the common rules on imports (OJ L 84, 31.3.2009, p. 1).

[4]               Regulation (EU) No 182/2011 of the European
Parliament and of the Council of 16 February 2011 laying down the rules and
general principles concerning mechanisms for control by Member States of the
Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).

[5]               Council Regulation (EEC) No
2658/87 of 23 July 1987 on the tariff and statistical nomenclature and on the
Common Customs Tariff (OJ L 256, 7.9.1987, p. 1).

[6]               Council Regulation (EEC) No
2913/92 of 12 October 1992 establishing the Community Customs Code (OJ L 302, 19.10.1992, p. 1).

[7]               Commission Regulation (EEC) No 2454/93 of 2 July 1993
laying down provisions for the implementation of Council Regulation (EEC) No
2913/92 establishing the Community Customs Code (OJ L 253, 11.10.1993, p. 1).

[8]               Regulation (EU) No 19/2013 of the European Parliament
and of the Council of 15 January 2013 implementing the bilateral safeguard
clause and the stabilisation mechanism for bananas of the Trade Agreement
between the European Union and its Member States, of the one part, and Colombia
and Peru, of the other part (OJ L 17, 19.1.2013, p. 1).

ANNEX

Covenants,
Conventions and Protocols referred to in Article 3(c)

Core
human and labour rights UN/ILO Conventions

1.           Convention on the
Prevention and Punishment of the Crime of Genocide (1948)

2            International Convention
on the Elimination of All Forms of Racial Discrimination (1965)

3.           International Covenant on
Civil and Political Rights (1966)

4.           International Covenant on
Economic, Social and Cultural Rights (1966)

5.           Convention on the
Elimination of All Forms of Discrimination Against Women (1979)

6.           Convention Against Torture
and other Cruel, Inhuman and Degrading Treatment or Punishment (1984)

7.           Convention on the Rights
of the Child (1989)

8.           Convention concerning
Forced or Compulsory Labour, No 29 (1989)

9.           Convention concerning
Freedom of Association and Protection of the Right to Organise, No. 87 (1948)

10.         Convention concerning the
Application of the Principles of the Right to Organise and to Bargain
Collectively, No. 98 (1949)

11.         Convention concerning Equal
Remuneration of Men and Women Workers for Work of Equal Value, No 100 (1951)

12.         Convention concerning the
Abolition of Forced Labour, No 105 (1957)

13.         Convention concerning
Discrimination in Respect of Employment and Occupation, No 111 (1958)

14.         Convention concerning
Minimum Age for Admission to Employment, No 138 (1973)

15.         Convention concerning the
Prohibition and Immediate Action for the Elimination of the Worst Forms of
Child Labour, No 182 (1999)

Conventions
related to the environment and to governance principles

16.         Convention on International
Trade in Endangered Species of Wild Fauna and Flora (1973)

17.         Montreal Protocol on
Substances that Deplete the Ozone Layer (1987)

18.         Basel Convention on the
Control of Transboundary Movements of Hazardous Wastes and Their Disposal
(1989)

19.         Convention on Biological
Diversity (1992)

20.         The United Nations
Framework Convention on Climate Change (1992)

21.         Cartagena Protocol on
Biosafety (2000)

22.         Stockholm Convention on
Persistent Organic Pollutants (2001)

23.         Kyoto Protocol to the
United Nations Framework Convention on Climate Change (1998)

24.         United Nations Single
Convention on Narcotic Drugs (1961)

25.         United Nations Convention
on Psychotropic Drugs (1971)

26.         United Nations Convention
against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988)

27.         United Nations Convention
against Corruption (2004)