PROTOCOLon financial and technical cooperation between the European Economic Community and the Kingdom of Morocco

THE COUNCIL OF THE EUROPEAN COMMUNITIES,of the one part, andTHE GOVERNMENT OF THE KINGDOM OF MOROCCO,of the other part,REAFFIRMING their resolve to implement, under the Mediterranean policy of the enlarged Community, cooperation which will contribute to the economic and social development of Morocco and promote the strengthening of relations between the Community and Morocco,ANXIOUS to pursue to this end the financial and technical cooperation provided for in the Cooperation Agreement between the European Economic Community and the Kingdom of Morocco,HAVE DECIDED to conclude this Protocol and to this end have designated as their Plenipotentiaries:THE COUNCIL OF THE EUROPEAN COMMUNITIES:Hans-Dietrich GENSCHER,Federal Minister for Foreign Affairs of the Federal Republic of Germany,President-in-Office of the Council of the European Communities;Claude CHEYSSON,Member of the Commission of the European Communities;THE KINGDOM OF MOROCCO:Abdellatif FILALI,Minister for Foreign Affairs and Cooperation:WHO, having exchanged their full powers, found in good and due form,HAVE AGREED AS FOLLOWS: Article 1Within the framework of the financial and technical cooperation provided for in the Cooperation Agreement concluded between the European Economic Community and the Kingdom of Morocco, the Community shall participate, on the terms set out in this Protocol, in the financing of measures intended to contribute to the economic and social development of Morocco. Article 2 1. For the purposes specified in Article 1 and for a period expiring on 31 October 1991, an aggregate amount of 324 million ECU may be committed as follows:(a151 million ECU in the form of loans from the European Investment Bank, hereinafter referred to as ´the Bank', made from its own resources;(b162 million ECU from the Community's budgetary resources, in the form of grants;

(c11 million ECU from the Community's budgetary resources, in the form of contributions to risk capital formation.2. The risk capital referred to in paragraph 1 (c) shall contribute to the cooperation objectives and operations defined in Article 3, in particular those indicated in the second indent of paragraph 2 of that Article.It shall be used primarily to make equity capital or the like available to Moroccan private undertakings, public undertakings and undertakings with State participation, in particular those with which natural or legal persons who are nationals of a Community Member State are associated. It may be used under the same conditions to finance specific studies for the preparation and development of such undertakings' projects and to assist such undertakings in their starting-up period.

It shall be granted and administered by the Bank and may take the form of:(asubordinated loans, where repayment and payment of any interest will not be made until other bank claims have been settled;(bconditional loans, where repayment or duration will depend on the fulfilment of conditions specified at the time when the loan is granted;(cacquisition of temporary minority holdings on behalf of the Community in the capital of undertakings established in Morocco;(dfinance for the acquisition of holdings, in the form of conditional loans granted to Morocco or, with the Moroccan Government's agreement, to Moroccan undertakings, either directly or through the intermediary of Moroccan financial institutions. Article 3 1. The total amount fixed in Article 2 shall be used primarily for the financing or part-financing of cooperation projects or operations aimed at:developing and diversifying agricultural production so as to reduce Morocco's food dependence, and efforts to diversify agricultural production and exports with a view to increasing the complementarity of the different Mediterranean regions.strengthening the economic links between the Community and Morocco in their mutual interest by developing cooperation in the fields of industry, training and research, technology, commerce and other services.regional and multilateral cooperation.The development and rehabilitation of economic and social infrastructure, industrial capital projects which are complementary to the above operations and related technical cooperation operations may also be financed.2. Of the projects and operations eligible for financing, priority shall be given to those having the following aims:in the agricultural sector, developing the production of agricultural products in short supply, particularly food crops, inter alia in the framework of multiannual programmes and operations in the context of the national food strategy. For maximum effectiveness, concentration of resources in specific sectors shall be sought,in the industrial and service sectors, promotion of joint ventures between firms from the Community Member States and Moroccan firms, direct contacts, exchange of information, promotion of investment, contribution of private capital, and support for small and medium-sized enterprises, including craft businesses, in order to promote employment,in the field of science and technology, expansion of Morocco's training and research capability and establishment or development of links between Moroccan and European private and public training and research institutions,in the trade sector, diversification and promotion of exports and organization of contacts between Moroccan firms and firms from the Community Member States,in the priority areas referred to above, practical training schemes linked to projects or operations in firms and research institutions.3. The Community's financial contributions shall be used to cover internal and external costs necessarily incurred in carrying out approved projects or schemes (including costs in respect of studies, consulting engineers and technical assistance). They may not be used to cover current administrative, maintenance or operational expenditure. Article 4 1. Capital projects shall be eligible for financing either by loans from the Bank, or by risk capital, or by grants, or by a combination of these means.2. Technical and economic cooperation shall normally be financed by grants. Article 5 1. The amounts to be committed each year must be distributed as evenly as possible throughout the period of application of this Protocol.2. Any funds not committed at the end of the period referred to in Article 2 (1) shall be used until exhausted. In such cases, the funds shall be used in accordance with the same arrangements as those laid down in this Protocol. Article 6 1. Loans granted by the Bank from its own resources shall be made in accordance with the arrangements, conditions and procedures laid down in its statute. They shall, as regards their duration, be subject to terms established on the basis of the economic and financial characteristics of the projects for which these loans are intended, also taking into account the conditions obtaining on the capital markets on which the Bank procures its resources. The interest rate shall be determined in accordance with the Bank's practice at the time of signature of each loan contract.2. The terms and arrangements for contributions to risk capital formation shall be determined on a case-by-case basis.3. Aid from the Community's budget resources, other than that intended for risk capital operations, shall be granted and administered by the Commission.4. The funds referred to in Article 2 may be granted by the State through the intermediary of the state or appropriate Moroccan bodies, on condition that they allocate the amounts to the recipients on terms decided, by agreement with the Community, on the basis of the economic and financial characteristics of the projects and operations for which they are intended. Article 7 Aid contributed by the Community for the execution of certain projects may, with the agreement of Morocco, take the form of co-financing in which, in particular, credit and development bodies and institutions of Morocco, of Member States or of third States or international finance organizations would take part. Article 8 The following shall be eligible for financial and technical cooperation:(ain general:the Moroccan State,(bwith the agreement of the Moroccan Government, for projects or operations approved by it:official Moroccan development agencies,private agencies working in Morocco for economic and social development,undertakings carrying on their activities in accordance with industrial and business management methods and set up as legal persons in accordance with the laws of Morocco,groups of producers who are nationals of Morocco and, exceptionally, where no such groups exist, the producers themselves,scholarship holders and trainees sent by Morocco under the training schemes referred to in Article 3.

Article 9 1. With a view to making optimum use of the instruments and means provided for in this Protocol and achieving the objectives laid down in Article 3, the Community and Morocco shall, taking information provided by Morocco as a basis, examine:the priority development objectives adopted at national level by the Government of Morocco,the sector or sectors on which the Community contribution will be focussed, taking account in particular of the contributions of other providers of funds on a bilateral or multilateral basis and other Community instruments, including food aid,the measures and schemes best suited to achieving the sectoral objectives referred to in the second indent or, where such schemes are not sufficiently well defined, the broad objectives of the programmes for supporting the policies defined by the country in respect of those sectors,the regional action programmes which could be financed by the Community.2. On this basis, the Community and Morocco shall, by mutual agreement, draw up an indicative programme committing both parties and determining the specific objectives of financial and technical cooperation, the priority sectors for intervention and the action programmes envisaged.3. The indicative programme may be reviewed by mutual agreement to take account of any changes in Morocco's economic situation or in the objectives and priorities laid down by its development plan.4. The Community and Morocco shall continue their exchanges of views within the appropriate bodies and shall, at least once during the period of implementation of this Protocol and at the latest before the end of the third year following its entry into force, make an assessment of the implementation of the indicative programme. Article 10 1. Requests for financial aid may be presented to the Community only by the Government of the Kingdom of Morocco, either on its own account or on behalf of the other recipients referred to in Article 8.2. The Community shall appraise the requests for financing in collaboration with the competent Moroccan authorities and other beneficiaries, in accordance with the objectives referred to in Article 3, and shall inform them of the decisions taken on such requests. Article 11 1. The execution, management and maintenance of schemes that are the subject of financing under this Protocol shall be the responsibility of Morocco or of the other beneficiaries referred to in Article 8.The Community shall make sure that this financial aid is expended in accordance with the agreed allocations and to the best economic advantage.2. The projects and action programmes shall be the subject of appropriate evaluation, the outcome of which shall be communicated to both parties, which shall take appropriate measures by mutual agreement.3. Certain rules for administering the financial aid granted by the Community shall be the subject of an exchange of letters or a framework agreement between the Commission and Morocco upon conclusion of this Protocol. Article 12 1. All natural and legal persons falling within the scope of the Treaty establishing the European Economic Community and all natural and legal persons of Morocco may participate on equal terms in tendering procedures and other procedures for the award of contracts likely to be financed. Any such legal person formed in accordance with the law of a Member State of the European Economic Community or of Morocco must have its registered office, its administrative head office or its principal establishment in the territories in which the EEC Treaty is applied or in Morocco; however, where only its registered office is in the said territories or in Morocco, the activities of such legal person must be effectively and continuously linked with the economy of those territories or of Morocco.2. In agreement with Morocco and with the aim of encouraging regional cooperation, natural and legal persons who are nationals of developing countries associated with the Community through overall cooperation or association agreements may be authorized by the Community, at the request of the Moroccan Government, exceptionally, on a case-by-case basis, to participate in the operations referred to in paragraph 1 which are financed by the Community. The eligibility of the natural or legal persons shall be assessed on the terms set out in paragraph 1, mutatis mutandis. Article 13 To promote participation by Moroccan undertakings in the performance of contracts and to ensure the rapid and effective implementation of projects and operations financed from resources administered by the Commission:

1An accelerated procedure for issuing invitations to tender, involving shorter time limits for the submission of tenders, may be used by Morocco in agreement with the Commission where it is a question of works contracts which, because of their scale, are mainly of interest to Moroccan undertakings.The organization of this accelerated procedure shall not rule out the possibility of issuing an international invitation to tender where it appears that the nature of the works to be carried out or the usefulness of widening participation justifies recourse to international competition.2Where urgency of the situation is established or where the nature, small scale or particular characteristics of certain works or supplies so warrant, Morocco may, in agreement with the Commission, authorize, as an exception, the placing of contracts after restricted invitations to tender, the conclusion of contracts by direct agreement and the performance of contracts through public works departments.The procedures referred to in points 1 and 2 may be used for operations whose estimated cost is less than 3 million ECU. Article 14 1. Morocco shall apply to contracts awarded for the execution of projects or operations financed by the Community fiscal and customs arrangements no less favourable than those applied vis-à-vis the most favoured bilateral aid donor or the most favoured international development organization.2. The content of the arrangements referred to in paragraph 1 shall be established by means of an exchange of letters between the Parties. Article 15 Morocco shall take the necessary measures to ensure that interest and all other payments due to the Bank in respect of transactions concluded under this Protocol are not subject to any national or local tax or levy. Article 16 Where a loan is accorded to a beneficiary other than the Moroccan State, the provision of a guarantee by the latter or of other adequate guarantees shall be required by the Bank as a condition of the grant of the loan. Article 17 Throughout the duration of the loans and risk capital operations provided for in Article 2, Morocco shall undertake to:

(aplace at the disposal of the beneficiaries or their guarantors the currency necessary for the payment of interest and commission and amortization of loans and risk-capital aid granted for the implementation of aid measures on their territory;(bmake available to the Bank the foreign currency necessary for the transfer of all sums received by it in national currency which represent the net revenue and proceeds from transactions involving the acquisition by the Community of holdings in the capital of companies or firms. Article 18 The results of financial and technical cooperation may be examined within the cooperation council. The latter shall establish, where appropriate, the general guidelines for such cooperation. Article 19 One year before the expiry of this Protocol, the Contracting Parties will examine what arrangements could be made for financial and technical cooperation during a possible further period.

Article 20 This Protocol shall be annexed to the Cooperation Agreement concluded between the European Economic Community and the Kingdom of Morocco. Article 21 1. This Protocol shall be subject to approval in accordance with the Contracting Parties' own procedures; the Contracting Parties shall notify each other that the procedures necessary to this end have been completed.2. This Protocol shall enter into force on the first day of the second month following the date on which the notifications provided for in paragraph 1 have been given. Article 22 This Protocol shall be drawn up in two copies in the Danish, Dutch, English, French, German, Greek, Italian, Portuguese, Spanish and Arabic languages, each of these texts being equally authentic.

En fe de lo cual, los plenipotenciarios abajo firmantes suscriben el presente Protocolo.Til bekraeftelse heraf har undertegnede befuldmaegtigede underskrevet denne protokol.Zu Urkund dessen haben die unterzeichneten Bevollmaechtigten ihre Unterschriften unter dieses Protokoll gesetzt.Eis pistosi ton anotero, oi ypogegrammenoi plirexoysioi ethesan tis ypografes toys sto paron protokollo.In witness whereof the undersigned Plenipotentiaries have signed this Protocol.En foi de quoi, les plénipotentiaires soussignés ont apposé leurs signatures au bas du présent protocole.In fede di che, i plenipotenziari sottoscritti hanno apposto le loro firme in calce al presente protocollo.Ten blijke waarvan de ondergetekende gevolmachtigden hun handtekening onder dit Protocol hebben gesteld.Em fé do que, os plenipotenciários abaixo assinados apuseram as suas assinaturas no final da presente Protocolo.

Hecho en Rabat, el veintiséis de mayo de mil novecientos ochenta y ocho.Udfaerdiget i Rabat, den seksogtyvende mai nitten hundrede og otteogfirs.Geschehen zu Rabat am sechsundzwanzigsten Mai neunzehnhundertachtundachtzig.iEgine sto Rampat, stis eikosi exi Maioy chilia enniakosia ogdonta okto.Done at Rabat, on the twenty-sixth day of May in the year one thousand nine hundred and eighty-eight.Fait à Rabat, le vingt-six mai mil neuf cent quatre-vingt-huit.Fatto a Rabat, addí ventisei maggio millenovecentottantotto.Gedaan te Rabat, de zesentwintigste mei negentienhonderd achtenachtig.Feito em Rabat, em vinte e seis de Maio de mil novecentos e oitenta e oito.

Por el Consejo de las Comunidades EuropeasFor Raadet for De europaeiske FaellesskaberFuer den Rat der Europaeischen GemeinschaftenGia to Symvoylio ton Evropaikon KoinotitonFor the Council of the European CommunitiesPour le Conseil des Communautés européennesPer il Consiglio delle Comunità europeeVoor de Raad van de Europese GemeenschappenPelo Conselho das Comunidades Europeias Por el Reino de MarruecosFor Kongeriget MarokkoFuer das Koenigreich MarokkoGia to Vasileio toy MarokoyFor the Kingdom of MoroccoPour le royaume du MarocPer il Regno del MaroccoVoor het Koninkrijk MarokkoPelo Reino de Marrocos