MEMORANDUM OF UNDERSTANDING between the European Community and the Arab Republic of Egypt on trade in textile products

MEMORANDUM OF UNDERSTANDING

The Arab Republic of Egypt and the European Community (hereinafter the 'Community`) on 5 and 6 November 1997 agree that there is a need to renew for two years the existing system of administrative cooperation on textile products, done and initialled as a Memorandum of Understanding in Geneva on 26 November 1993 as last amended by exchange of letters initialled on 13 October 1995.

Both parties confirm their readiness to seek acceptable solutions to any problems which might arise and hence to avoid recourse to measures which might be prejudicial to the interest of both parties.

In this spirit of cooperation, both parties agree that the trade in textile products between the Community and the Arab Republic of Egypt shall be based on the following provisions:

1. The Community will undertake not to apply safeguard measures provided for by Article 34 of the Cooperation Agreement between the Community and the Arab Republic of Egypt, as long as the imports of products listed in the Annex I are not higher than the levels indicated in the said Annex.

2. The administrative cooperation system agreed during the discussions and set out in Annex II will apply to the products covered by this Memorandum of Understanding.

3. The Community undertakes not to charge to the agreed levels imports intended for inward processing or re-export.

4. The Egyptian authorities undertake to organise their exports of the products listed in Annex I so that the agreed levels laid down therein are not exceeded.

5. The parties shall cooperate in order to prevent sudden and prejudicial changes in traditional trade flows resulting in regional concentration of direct imports into the Community.

6. Egypt shall endeavour not to deprive certain regions of the Community which have traditionally had relatively small shares of Community quotas of imports serving as inputs for their processing industry.

7. The Egyptian authorities may, in their management of export, make use of the flexibility provisions laid down in Annex III.

8. At the request of either party, consultations may be held to examine specific problems in the field of this Memorandum of Understanding. Such consultations shall be held within a maximum of 10 working days following a request by either party.

9. The present regime will enter into force on 1 January 1998 and will last until 31 December 1999.

Signed at Brussels, on 6 November 1997.

For the Arab Republic of Egypt

For the European Community

ANNEX I

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ANNEX II

ADMINISTRATIVE COOPERATION

The system of administrative cooperation to be applied by the Community and the Arab Republic of Egypt in their trade in textile products will be as follows:

1. The Egyptian authorities (Cotton Textile Consolidation Fund) shall issue an export document for every consignment of products listed in Annex I of the Memorandum of Understanding. The export document shall correspond to the specimen as shown in Annex IV hereto.

(a) for products for which levels have been agreed and which are intended to enter into free circulation within the Community, export licences shall only be isssued up to the agreed Community levels. Each licence must, in particular, certify that the amount in question has been charged against the level for the product category concerned. For such products for which no level has been agreed, export licences are issued without restriction but account is kept of the quantities issued.

Where export documents are cancelled the Egyptian authorities shall inform the Commission of the European Communities immediately, providng all the necessary information to prevent the relevant quantity from being set off against the limit concerned.

(b) The actual date of shipment shall determine the quota year against which goods are to be charged. To this end, the date shown on the bills of lading or airway bills or any other equivalent document shall be regarded as constituting proof.

2. The authorities of the Member States shall issue import documents or authorisations automatically within five working days on receipt of the request, provided that it is accompanied by the export document referred to subparagraph 1.

3. In order to facilitate this cooperation system:

- the Parties will exchange statistics about actual imports and exports as well as import and export documents issued during each calendar year,

- in addition, the Parties will exchange cumulative statistics on a quarterly basis. These data will be communicated to the other party before the end of the third month following every quarter.

4. The classification of the products referred to in Annex I shall be based on the tariff and statistical nomenclature of the Community (hereinafter called the 'Combined Nomenclature` or in abbreviated form 'CN`) and any amendments thereof.

No decision relating to the classification of goods or amendment to the Combined Nomenclature (CN) concerning the category of products in question, shall have the effect of reducing the agreed levels.

ANNEX III

FLEXIBILITIES

The flexibility shall be as follows:

1. The Egyptian authorities may carry over unused levels from the preceding year up to a maximum of 10 % of the levels for the year in progress.

2. Advance use of agreed levels for the next year may be made up to a maximum of 10 % of the levels for the year in progress.

3. The transfer between category 1 and category 2 is authorised within the limit of 7,5 % of the figure initially agreed for the category to which the transfer is made.

ANNEX IV

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1 Exporter (name, full address, country) Exportateur (nom, adresse complète, pays) 5 Consignee (name, full address, country) Destinataire (nom, adresse complète, pays) ORIGINAL 2No 3 Quota period Année contingentaire 4 Category number Numéro de catégorie EXPORT LICENCE (Textile products) LICENCE D'EXPORTATION (Produits textiles) 6 Country of origin Pays d'origine 7 Country of destination Pays de destination 8 Place and date of shipment - Means of transport Lieu et date d'embarquement - Moyen de transport 9 Supplementary details Données supplémentaires 10 Marks and numbers - Number and kind of packages - DESCRIPTION OF GOODS Marques et numéros - Nombre et nature des colis - DÉSIGNATION DES MARCHANDISES 11 Quantity (1) Quantité (1) 12 FOB value (2) Valeur fob (2) 13 CERTIFICATION BY THE COMPETENT AUTHORITY - VISA DE L'AUTORITÉ COMPÉTENTE I, the undersigned, certify that the goods described above have been charged against the quantitative limit established for the year shown in box No 3 in respect of the category shown in box No 4 by the provisions regulating trade in textile products with the European Community. Je soussigné certifie que les marchandises désignées ci-dessus ont été imputées sur la limite quantitative fixée pour l'année indiquée dans la case 3 pour la catégorie désignée dans la case 4 dans le cadre des dispositions régissant les échanges de produits textiles avec la Communauté européenne. 14 Competent authority (name, full address, country) Autorité compétente (nom, adresse complète, pays) At - À . , on - le . (Signature) (Stamp - Cachet) (1) Show net weight (kg) and also quantity in the unit prescribed for category where other than net weight - Indiquer le poids net en kilogrammes ainsi que la quantité dans l'unité prévue pour la catégorie si cette unité n'est pas le poids net. (2) In the currency of the sale contract - Dans la monnaie du contrat de vente.>END OF GRAPHIC>

AGREED MINUTE

With regard to the question of management of the levels below which the Community undertakes not to apply safeguards measures provided for by Article 34 of the Cooperation Agreement, the Arab Republic of Egypt makes clear its intention to take the necessary measures to ensure that Egyptian exports of products listed in Annex I do not exceed the Community agreed levels as provided for under the flexibility provisions in the Memorandum of Understanding itself.

The government of Egypt also takes note of the Community's desire to resume normal regime of trade as soon as possible. It recalls in this connection that the system governing access to the Community for cotton products originating in Egypt is one of free entry without quantitative restrictions or equivalent measures.

Signed at Brussels, on 6 November 1997.

For the Arab Republic of Egypt

For the European Community

AGREED MINUTE

Should the Community and the Arab Republic of Egypt conclude an association agreement, the Memorandum of Understanding on textiles emerging from these negotiations on 5 and 6 November 1997, will take the form envisaged by the provisions of the agreement and of the joint declarations annexed to it.

Signed at Brussels, on 6 November 1997.

For the Arab Republic of Egypt

For the European Community