AGREEMENT IN THE FORM OF AN EXCHANGE OF LETTERS

amending the Agreement in the form of an Exchange of Letters between the European Community and the Republic of Hungary on the reciprocal establishment of tariff quotas for certain wines

A. Letter from the Community

Brussels, 24 July 1999

Sir,

I have the honour to refer to the Agreement of 29 November 1993 in the form of an Exchange of Letters between the European Community and the Republic of Hungary on the reciprocal establishment of tariff quotas for certain wines and to the negotiations which have taken place between the European Community and the Republic of Hungary with a view to adapting the said Agreement following the accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union, and to extending the Agreement beyond 31 December 1998.

I hereby confirm that the European Community and the Republic of Hungary have agreed on the following:

I. In point 2), first and third indent of the Agreement, the words "...within the meaning of the Hungarian Law No 36/1970 on winegrowing and implementing Regulation No 40/1977 (MEM), as amended by Regulation No 7/1990 (FM) and No 23/1992 (FM),..." shall be replaced by the following words: "... within the meaning of the Hungarian Wine Law...".

II. Table 1 in the Annex to the said Agreement shall be replaced by the following table:

"Quantities of wine originating in the Community and qualifying for tariff reductions

>TABLE>"

III. Table 2 in the Annex to the said Agreement shall be replaced by the following table:

"Quantities of wine originating in Hungary and qualifying for tariff reductions

>TABLE>"

IV. Point 3(a) of the said Agreement shall be replaced by the following: "In the case of duties applied by Hungary to imports of wine originating in the Community:

- in 1993: 90 % of the basic duty,

- in 1994: 80 % of the basic duty,

- in 1995 and subsequent years: 70 % of the basic duty,

- in 1999, in accordance with the principle of standstill, the duties applicable will be as indicated in the following table:

Duties applied by Hungary to imports of wine originating in the Community

>TABLE>"

This Exchange of Letters shall be approved by the Contracting Parties in accordance with their respective procedures.

This Agreement shall enter into force on the day of its signature. It shall apply from 1 May 1999 to 31 December 1999, in accordance with the respective legislation and regulations of the Contracting Parties. It shall expire on 31 December 1999. During the first half of 1999, negotiations will take place with a view to concluding an additional Protocol to the Europe Agreement covering both wines and spirits. Moreover, the additional Protocol to the Europe Agreement will define the modalities for cooperation between Hungary and the European Community to support the implementation of a programme for progressive application by Hungary of the "acquis communautaire" in the field of wine and spirits, particularly as regards reinforcing the supply management and control instruments in the winegrowing sector (including the establishment of a vineyard register).

I should be obliged if you would confirm that your Government is in agreement with the content of this letter.

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

On behalf of the Council of the European Union

>PIC FILE= "L_1999212EN.000501.EPS">

B. Letter from the Republic of Hungary

Brussels, 29 July 1999

Sir,

I have the honour to acknowledge receipt of your letter of today's date, which reads as follows: "I have the honour to refer to the Agreement of 29 November 1993 in the form of an Exchange of Letters between the European Community and the Republic of Hungary on the reciprocal establishment of tariff quotas for certain wines and to the negotiations which have taken place between the European Community and the Republic of Hungary with a view to adapting the said Agreement following the accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union, and to extending the Agreement beyond 31 December 1998.

I hereby confirm that the European Community and the Republic of Hungary have agreed on the following:

I. In point 2), first and third indent of the Agreement, the words '... within the meaning of the Hungarian Law No 36/1970 on winegrowing and implementing Regulation No 40/1977 (MEM), as amended by Regulation No 7/1990 (FM) and No 23/1992 (FM),...' shall be replaced by the following words: '... within the meaning of the Hungarian Wine Law...'.

II. Table 1 in the Annex to the said Agreement shall be replaced by the following table:

'Quantities of wine originating in the Community and qualifying for tariff reductions

>TABLE>'

III. Table 2 in the Annex to the said Agreement shall be replaced by the following table:

'Quantities of wine originating in Hungary and qualifying for tariff reductions

>TABLE>'

IV. Point 3(a) of the said Agreement shall be replaced by the following: 'In the case of duties applied by Hungary to imports of wine originating in the Community:

- in 1993: 90 % of the basic duty,

- in 1994: 80 % of the basic duty,

- in 1995 and subsequent years: 70 % of the basic duty,

- in 1999, in accordance with the principle of standstill, the duties applicable will be as indicated in the following table:

Duties applied by Hungary to imports of wine origianting in the Community

>TABLE>'

This Exchange of Letters shall be approved by the Contracting Parties in accordance with their respective procedures.

This Agreement shall enter into force on the day of its signature. It shall apply from 1 May 1999 to 31 December 1999, in accordance with the respective legislation and regulations of the Contracting Parties. It shall expire on 31 December 1999. During the first half of 1999, negotiations will take place with a view to concluding an additional Protocol to the Europe Agreement covering both wines and spirits. Moreover, the additional Protocol to the Europe Agreement will define the modalities for cooperation between Hungary and the European Community to support the implementation of a programme for progressive application by Hungary of the acquis communautaire in the field of wine and spirits, particularly as regards reinforcing the supply management and control instruments in the winegrowing sector (including the establishment of a vineyard register).

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 confirm that my Government is in agreement with the contents of your letter.

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

For the Government of the Republic of Hungary

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