# EUR-Lex - 52012PC0346 - EN

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# 52012PC0346

**Proposal for a COUNCIL DECISION concluding an Agreement in the form of an Exchange of Letters between the European Union and the United States of America pursuant to Article XXIV:6 and Article XXVIII of the General Agreement on Tariffs and Trade (GATT) 1994 relating to the modification of concessions in the schedules of the Republic of Bulgaria and Romania in the course of their accession to the European Union /* COM/2012/0346 final - 2012/0167 (NLE) */**

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EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

With the accession of the Republic of
Bulgaria and Romania, the European Union enlarged its customs union.
Consequently, the European Union was obliged under WTO rules (GATT Article
XXIV:6) to enter into negotiations with WTO Members having negotiating rights
in the schedules of any of the acceding Members in order to agree on
compensatory adjustment. Such adjustment is due if the adoption of the EU’s
external tariff regime results in an increase in tariff beyond the level for
which the acceding country has bound itself at the WTO, whilst taking ‘due
account of reductions of duties on the same tariff line made by other
constituents of the customs union upon its formation’.

On 29 January 2007, the Council authorised
the Commission to open negotiations under Article XXIV:6 of GATT 1994. The
Commission has negotiated with the Members of the WTO holding negotiating
rights with respect to the withdrawal of specific concessions in relation to
the withdrawal of the schedules of the Republic of Bulgaria and Romania, in the
course of their accession to the European Union.

Negotiations with the United States of
America resulted in a draft Agreement in the form of an Exchange of Letters
that was initialled by the EU side on 21 December 2011 in Brussels and by the
US side on 17 February in Washington D.C..

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

Negotiations have been conducted by the
Commission within the framework of the negotiating directives issued by the
Council. The Council (TPC) and the European Parliament (INTA) were informed of
the text of the draft agreement prior to being initialled.

3.           LEGAL ELEMENTS OF THE
PROPOSAL

This proposal asks the Council to adopt a
decision concluding the Agreement in the form of an Exchange of Letters with the
United States of America. In parallel, a separate proposal on the signature of
this Agreement is also submitted.

The implementing Regulation will
consequently be adopted by the Commission, pursuant to Article 144 of the
Single Common Market Organisation (CMO) Regulation (Regulation (EC) No 1234/2007)
and to Article 7 of the Regulation (EC) No 1216/2009 laying down the trade
arrangements applicable to certain goods resulting from the processing of
agricultural products.

2012/0167 (NLE)

Proposal for a

COUNCIL DECISION

concluding an Agreement in the form of an
Exchange of Letters between the European Union and the United States of America
pursuant to Article XXIV:6 and Article XXVIII of the General Agreement on
Tariffs and Trade (GATT) 1994 relating to the modification of concessions in
the schedules of the Republic of Bulgaria and Romania in the course of their
accession to the European Union

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the
Functioning of the European Union, and in particular the first subparagraph of Article
207(4), in conjunction with Article 218(6)(a)(v) thereof,

Having regard to the proposal from the
European Commission,

Having regard to the consent of the
European Parliament,

Whereas:

(1)       On 29 January 2007 the Council authorised the Commission
to open negotiations with certain other Members of the World Trade Organization
under Article XXIV:6 of the General Agreement on Tariffs and Trade (GATT) 1994
in the course of the accessions to the European Union of the Republic of
Bulgaria and Romania.

(2)       Negotiations have been
conducted by the Commission within the framework of the negotiating directives adopted
by the Council.

(3)       These negotiations have
been concluded and the Agreement in the form of an Exchange of Letters between
the European Union and the United States of America pursuant to Article XXIV:6
and Article XXVIII of the General Agreement on Tariffs and Trade (GATT) 1994
relating to the modification of concessions in the schedules of the Republic of
Bulgaria and Romania in the course of their accession to the European Union
(the Agreement) was initialled by a representative of the European Union on 21
December 2011 and by a representative of the United States of America on 17
February 2012.

(4)       The Agreement was signed
on behalf of the European Union on [...], subject to its conclusion at a later
date, in accordance with Council Decision [...][1].

(5)       The Agreement should be approved,

HAS ADOPTED THIS DECISION:

Article 1

The Agreement in the form of an Exchange of
Letters between the European Union and the United States of America pursuant to
Article XXIV:6 and Article XXVIII of the General Agreement on Tariffs and Trade
(GATT) 1994 relating to the modification of concessions in the schedules of the
Republic of Bulgaria and Romania in the course of their accession to the
European Union (the Agreement) is hereby approved on behalf of the Union.

The text of the Agreement is annexed to
this Decision.

Article 2

The President of the Council is hereby
authorised to designate the person(s) empowered to give, on behalf of the
Union, the notification provided for in the Agreement[2].

Article 3

This
Decision shall enter into force on the day of its adoption.

Done at Brussels,

For
the Council

The
President

ANNEX

AGREEMENT IN THE FORM OF AN
EXCHANGE OF LETTERS

Between the European Union and the
United States of America pursuant to Article XXIV:6 and Article XXVIII of the
General Agreement on Tariffs and Trade (GATT) 1994 relating to the modification
of concessions in the schedules of the Republic of Bulgaria and Romania in the
course of their accession to the European Union

A.
Letter from the European Union

Place,
date

Sir,

Following
negotiations under Article XXIV:6 and Article XXVIII of the General Agreement
on Tariffs and Trade (GATT) 1994 relating to the modification of the Schedules
of the Republic of Bulgaria and Romania in the course of their accession to the
European Union, I have the honour to confirm the following understanding:

1.         The
European Union shall incorporate and bind in its WTO Schedule for the customs
territory of the EU 27 the concessions that were included in its schedule for
the customs territory of the EU 25 with the modifications set out in this
letter.

Add 4680 tonnes
in the country allocated (US) EU tariff rate quota for 'meat and edible offal
of poultry, fresh, chilled or frozen', maintaining the existing in-quota rates

(tariff item numbers 0207 1110, 0207 1130,
0207 1190, 0207 1210, 0207 1290, 0207 1310, 0207 1320, 0207 1330, 0207 1340,
0207 1350, 0207 1360, 0207 1370, 0207 1410, 0207 1420, 0207 1430, 0207 1440,
0207 1450, 0207 1460, 0207 1470, 0207 2410, 0207 2490, 0207 2510, 0207 2590,
0207 2610, 0207 2620, 0207 2630, 0207 2640, 0207 2650, 0207 2660, 0207 2670,
0207 2680, 0207 2710, 0207 2720, 0207 2730, 0207 2740, 0207 2750, 0207 2760,
0207 2770, 0207 2780);

Add 200 tonnes in the country allocated
(US) EU tariff rate quota for 'frozen boneless hams and loins', maintaining the
present in-quota rate of 250 €/t (tariff item numbers ex 0203 1955 and ex 0203
2955);

Create a country allocated (US) tariff rate
quota of 1550 tonnes for ‘food preparations’, with an in-quota rate
'Agricultural Element' (tariff item number 2106 9098);

Add 600 tonnes (erga omnes) in the EU
tariff rate quota for 'cuts of domestic swine, fresh, chilled or frozen, with
or without bone, excluding tenderloin, presented separately', maintaining the
existing in-quota rates (tariff item numbers 0203 1211, 0203 1219, 0203 1911,
0203 1913, 0203 1915, ex 0203 1955, 0203 1959, 0203 2211, 0203 2219, 0203 2911,
0203 2913, 0203 2915, ex 0203 2955, 0203 2959);

Add 500 tonnes (erga omnes) in the EU
tariff rate quota for 'chicken cuts, fresh, chilled or frozen', maintaining the
existing in-quota rates (tariff item numbers 0207 1310, 0207 1320, 0207 1330,
0207 1340, 0207 1350, 0207 1360, 0207 1370, 0207 1420, 0207 1430, 0207 1440,
0207 1460);

Add 400 tonnes (erga omnes) in the EU
tariff rate quota for 'cuts of fowls', maintaining the existing in quota rate
795 €/t (tariff item number 0207 1410);

Add 580 tonnes (erga omnes) in the EU
tariff rate quota for 'turkey meat, fresh, chilled or frozen', maintaining the
existing in-quota rates (tariff item numbers 0207 2410, 0207 2490, 0207 2510,
0207 2590, 0207 2610, 0207 2620, 0207 2630, 0207 2640, 0207 2650, 0207 2660,
0207 2670, 0207 2680, 0207 2730, 0207 2740, 0207 2750, 0207 2760, 0207 2770);

If all internal procedures required for the
EU to incorporate and bind in its WTO schedule the modifications set forth in
this letter are not completed 60 days prior to the expiration of the period for
the United States to exercise its right to withdraw substantially equivalent
concessions pursuant to Article XXVIII of the GATT, the EU shall request that
the WTO Council for Trade in Goods approve, prior to the expiration of the
period, an extension of the period. Such extension shall be of sufficient
length to ensure that all those EU internal procedures are completed 60 days
prior to the expiration of the period for the United States to exercise its
rights under Article XXVIII of the GATT.

2.         Concurrent with the negotiation
of the modifications set forth above and also related to the enlargement of the
customs territory of the European Union to include the Republic of Bulgaria and
Romania, the United States of America shall within 21 days of entry into force
of this agreement submit for publication in the Federal Register a notice
modifying the tariff-rate import quotas for cheeses allocated for the European
Union in the additional U.S. notes 16, 17, 18, 19, 20, 21, 22, 23 and 25 of
Chapter 04 of the Harmonized Tariff Schedule of the United States to reflect
the enlargement of the customs territory of the European Union to include Bulgaria
and Romania.

3.         Consultations may be held at any
time with regard to any of the above matters at the request of either Party.

I should be obliged if you would confirm
that your Government is in agreement with the content of this letter. I have
the honour to propose that, should this be the case, this letter and your
confirmation shall together constitute an Agreement in the form of an Exchange
of Letters between the European Union and the United States of America (the
‘Agreement’).

The European Union and the United States of
America shall notify to each other in writing of the completion of any internal
procedures necessary for the entry into force of this Agreement. This Agreement
shall enter into force 14 days after the date of receipt of the date of the
latest notification.

Please accept, Sir, the assurance of my
highest consideration.

For
the European Union

B.
Letter from the United States of America

Place,
date

Sir,

I have the honor to acknowledge the receipt
of your letter of ..., which reads as follows:

“Following
negotiations under Article XXIV:6 and Article XXVIII of the General Agreement
on Tariffs and Trade (GATT) 1994 relating to the modification of the Schedules
of the Republic of Bulgaria and Romania in the course of their accession to the
European Union, I have the honour to confirm the following understanding:

1.         The
European Union shall incorporate and bind in its WTO Schedule for the customs territory
of the EU 27 the concessions that were included in its schedule for the customs
territory of the EU 25 with the modifications set out in this letter.

Add 4680 tonnes
in the country allocated (US) EU tariff rate quota for 'meat and edible offal
of poultry, fresh, chilled or frozen', maintaining the existing in-quota rates

(tariff item numbers 0207 1110, 0207 1130,
0207 1190, 0207 1210, 0207 1290, 0207 1310, 0207 1320, 0207 1330, 0207 1340,
0207 1350, 0207 1360, 0207 1370, 0207 1410, 0207 1420, 0207 1430, 0207 1440,
0207 1450, 0207 1460, 0207 1470, 0207 2410, 0207 2490, 0207 2510, 0207 2590,
0207 2610, 0207 2620, 0207 2630, 0207 2640, 0207 2650, 0207 2660, 0207 2670,
0207 2680, 0207 2710, 0207 2720, 0207 2730, 0207 2740, 0207 2750, 0207 2760,
0207 2770, 0207 2780);

Add 200 tonnes in the country allocated
(US) EU tariff rate quota for 'frozen boneless hams and loins', maintaining the
present in-quota rate of 250 €/t (tariff item numbers ex 0203 1955 and ex 0203
2955);

Create a country allocated (US) tariff rate
quota of 1550 tonnes for ‘food preparations’, with an in-quota rate
'Agricultural Element' (tariff item number 2106 9098);

Add 600 tonnes (erga omnes) in the EU
tariff rate quota for 'cuts of domestic swine, fresh, chilled or frozen, with
or without bone, excluding tenderloin, presented separately', maintaining the
existing in-quota rates (tariff item numbers 0203 1211, 0203 1219, 0203 1911, 0203
1913, 0203 1915, ex 0203 1955, 0203 1959, 0203 2211, 0203 2219, 0203 2911, 0203
2913, 0203 2915, ex 0203 2955, 0203 2959);

Add 500 tonnes (erga omnes) in the EU
tariff rate quota for 'chicken cuts, fresh, chilled or frozen', maintaining the
existing in-quota rates (tariff item numbers 0207 1310, 0207 1320, 0207 1330,
0207 1340, 0207 1350, 0207 1360, 0207 1370, 0207 1420, 0207 1430, 0207 1440,
0207 1460);

Add 400 tonnes (erga omnes) in the EU
tariff rate quota for 'cuts of fowls', maintaining the existing in quota rate
795 €/t (tariff item number 0207 1410);

Add 580 tonnes (erga omnes) in the EU
tariff rate quota for 'turkey meat, fresh, chilled or frozen', maintaining the
existing in-quota rates (tariff item numbers 0207 2410, 0207 2490, 0207 2510,
0207 2590, 0207 2610, 0207 2620, 0207 2630, 0207 2640, 0207 2650, 0207 2660,
0207 2670, 0207 2680, 0207 2730, 0207 2740, 0207 2750, 0207 2760, 0207 2770);

If all internal procedures required for the
EU to incorporate and bind in its WTO schedule the modifications set forth in
this letter are not completed 60 days prior to the expiration of the period for
the United States to exercise its right to withdraw substantially equivalent
concessions pursuant to Article XXVIII of the GATT, the EU shall request that
the WTO Council for Trade in Goods approve, prior to the expiration of the
period, an extension of the period. Such extension shall be of sufficient
length to ensure that all those EU internal procedures are completed 60 days
prior to the expiration of the period for the United States to exercise its
rights under Article XXVIII of the GATT.

2.         Concurrent with the negotiation
of the modifications set forth above and also related to the enlargement of the
customs territory of the European Union to include the Republic of Bulgaria and
Romania, the United States of America shall within 21 days of entry into force
of this agreement submit for publication in the Federal Register a notice
modifying the tariff-rate import quotas for cheeses allocated for the European
Union in the additional U.S. notes 16, 17, 18, 19, 20, 21, 22, 23 and 25 of
Chapter 04 of the Harmonized Tariff Schedule of the United States to reflect
the enlargement of the customs territory of the European Union to include Bulgaria
and Romania.

3.         Consultations may be held at any
time with regard to any of the above matters at the request of either Party.

I should be obliged if you would confirm
that your Government is in agreement with the content of this letter. I have
the honour to propose that, should this be the case, this letter and your
confirmation shall together constitute an Agreement in the form of an Exchange
of Letters between the European Union and the United States of America (the
‘Agreement’).

The European Union and the United States of
America shall notify to each other in writing of the completion of any internal
procedures necessary for the entry into force of this Agreement. This Agreement
shall enter into force 14 days after the date of receipt of the date of the
latest notification.”

I hereby have the honor to express my
Government's agreement with the above letter.

Please accept, Sir, the assurance of my
highest consideration.

On
behalf of the United States of America

[1]               OJ L [...], [...], p. [...].

[2]               The date of entry into force of the Agreement will be
published in the Official Journal of the European Union by the General
Secretariat of the Council.