ADDITIONAL PROTOCOL to the Interim Agreement on trade and trade-related matters between the European Economic Community and the European Coal and Steel Community and the Republic of Hungary and to the Europe Agreement between the European Communities and their Member States and the Republic of Hungary

THE EUROPEAN ECONOMIC COMMUNITY AND THE EUROPEAN COAL AND STEEL COMMUNITY, hereinafter referred to as 'the Community`,

of the one part and,

THE REPUBLIC OF HUNGARY, hereinafter referred to as 'Hungary`,

of the other part,

Whereas the Europe Agreement establishing an association between the European Communities and their Member States and the Republic of Hungary was signed in Brussels on 16 December 1991 (hereinafter referred to as 'the Europe Agreement`) and has not yet entered into force;

Whereas pending the entry into force of the Europe Agreement provisions thereof on trade and trade-related matters have been put into force since 1 March 1992 by the Interim Agreement on trade and trade-relate matters between the European Economic Community and the European Coal and Steel Community of the one part and the Repulbic of Hungary of the other part, signed in Brussels on 16 December 1991 (hereinafter called 'the Interim Agreement`), as last amended by an exchange of letters signed on 17 December 1992;

Recognizing the crucial importance of trade in the transition to a market economy;

BEARING IN MIND the willingness of the Community to accelerate its efforts to open up its markets for products of Hungarian origin;

BEARING IN MIND the objectives of the Europe Agreement and, in particular, those referred to in Article 1 thereof;

HAVING REGARD to the Interim Agreement, and in particular Article 1 thereof,

HAVE DECIDED to conclude this Protocol and to this end have designated as their plenipotentiaries:

THE EUROPEAN ECOCOMIC COMMUNITY:

THE EUROPEAN COAL AND STEEL COMMUNITY:

THE REPUBLIC OF HUNGARY:

WHO, having exchanged their full powers, found in good and due form,

HAVE AGREED AS FOLLOWS:

Article 1

Article 3 (2), second subparagraph, of the Interim Agreement and Article 9 (2), second subparagraph, of the Europe Agreement are replaced by the following text:

'Customs duties on imports applicable in the Community to products originating in Hungary listed in Annex II b shall be reduced, on the date of entry into force of this Agreement by 20 % of the basic duty and one year thereafter by a further 20 % of the basic duty. Duties shall be totally abolished by the end of the second year after the entry into force of the Agreement.`

Article 2

Article 3 (3), second subparagraph, of the Interim Agreement and Article 9 (3), second subparagraph, of the Europe Agreement are replaced by the following text:

'At the same time customs duties on imports applicable to import quantities in excess of the quotas or ceilings provided for above shall be progressively abolished so as to arrive at a complete abolition of customs duties on imports of the products concerned at the end of the third year at the latest.`

Article 3

Footnote (3) of Annex III to the Interim Agreement and of Annex III to the Europe Agreement is replaced by the following text:

'(3) These amounts will be increased:

- by 15 % at the entry into force of the Agreement.,

- by a further 15 % on 1 January 1993,

- by a further 10 % on 1 July 1993,

- by a further 25 % on 1 January 1994.`

Article 4

Footnote (5) of Annex III to the Interim Agreement and of Annex III to the Europe Agreement is replaced by the following text:

'(5) Customs duties applicable to imports exceeding the tariff quotas and ceilings listed in this Annex will gradually be reduced to 90 % of the basic duty when the Agreement enters into force, 80 % one year after the date of entry into force, and 70 % two years after the date of entry into force. Any remaining customs duties will be abolished at the end of the third year.`

Article 5

1. The introductory paragraph of Annex X b to the Interim Agreement and Annex X b to the Europe Agreement shall be replaced by the following text:

'The quantities imported under the CN codes referred to in this Annex, with the exception of codes 0104 and 0204, will be subject to levy and duty reductions of 20 % from 1 March 1992, 40 % from 1 January 1993 and 60 % from 1 July 1993.`

2. An introductory paragraph shall be added to Annex X c to the Interim Agreement and to Annex X c to the Europe Agreement as follows:

'The duty rates set out for year 3, year 4 and year 5 respectively, shall be applicable from 1 July 1993, 1 July 1994 and 1 July 1995 respectively.`

3. A second introductory paragraph shall be added to Annexes VIII a, X b and X c to the Interim Agreement and to Annexes VIII a, X b and X c to the Europe Agreement as follows:

'The quantities in tonnes set out for year 3 shall be applicable from 1 July 1993 to 30 June 1994. The amounts imported prior to 1 July 1993 in excess of 50 % of the amount for year 2 shall be deducted form the amount applicable for year 3.

The quantities in tonnes set out for year 4 and year 5 respectively shall be applicable from 1 July 1994 to 30 June 1995 and from 1 July 1995 to 30 June 1996 respectively.`

Article 6

The last two indents of Article 3 (1) of Protocol 1 on textile and clothing products to the Interim Agreement and Protocol 1 on textile and clothing products to the Europe Agreement are repalced by the following text:

'- at the start of the sixth year the remaining duties shall be eliminated.`

Article 7

Article 2, point 2, of Protocol 2 on ECSC products to the Interim Agreement and Porotocl 2 on ECSC products to the Europe Agreement is repalced by the following text:

'2. further reductions to 60, 40, 20 and 0 % of the basic duty shall be made at the beginning of the second, third, fourth and fifth years respectively after the entry into force of the Agreement.`

Article 8

This Protocol shall form an integral part of the Interim Agreement and of the Europe Agreement.

Article 9

This Protocol shall enter into force on the first day of the month following the date upon which the Parties notify each other of the completion of the procedures necessary for that purpose. This Protocol shall apply from 1 July 1993 with the exception of Article 7.

Article 10

This Protocol shall be drawn up in four copies in the Danish, Dutch, English, French, Greek, Italian, Portuguese, Spanish and Hungarian languages, each of these texts being equally authentic.

Done at Brussels on