AGREEMENT in the form of an exchange of letters between the European Community and the People's Republic of China amending the 1988 MFA Agreement between the European Economic Community and the People's Republic of China on trade in textile products to take into account the expected accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union

Letter from the Council of the European Union

Sir,

1. I have the honour to refer to the Agreement between the European Economic Community and the People's Republic of China on trade in textile products initialled on 9 December 1988, as last amended and extended by the exchange of letters initialled on 8 December 1992.

2. In order to take into account the likely accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union on 1 January 1995, the European Community considers that the following amendments should be made to the Agreement between the European Economic Community and the People's Republic of China on trade in textile products:

2.1. The following text is added after Article 6, paragraph 2:

'For the purposes of applying the provisions of paragraph 2 in the year 1995, the preceding year's total imports from all third countries shall be calculated on the basis of imports into the Community as constituted on 31 December 1994 and of imports into Austria, Finland and Sweden. Trade between the Community, Austria, Finland and Sweden, or between Austria, Finland and Sweden shall be excluded from this total.`

2.2 Figures in Annex III which set out the quantitative limits for exports from the People's Republic of China to the European Union are to be replaced on 31 December 1994 by limits for the enlarged Community as set out in Appendix I to this letter.

2.3. Article 14, paragraph 2, subparagraph 2, second indent of Protocol A, Title IV should be amended as follows:

'- two letters identifying the intended Member State of customs clearance as follows:

AT = Austria

BL = Benelux

DE = Federal Republic of Germany

DK = Denmark

EL = Greece

ES = Spain

FI = Finland

FR = France

GB = United Kingdom

IE = Ireland

IT = Italy

PT = Portugal

SE = Sweden`

2.4. The Annex of Protocol A, setting out the model of the certificate of origin is replaced by Appendix II to this letter.

2.5. The Annex to Protocol A setting out the model of the export licence is replaced by Appendix III to this letter.

2.6. The Annex to Protocol B setting out the model of the certificate applicable to certain cottage industry and folklore products is replaced by Appendix IV to this letter.

2.7. Figures in the Annex to Protocol E which set out the quantitative limits for economic outward processing operations are to be replaced on 31 December 1994 by limits for the enlarged Community as set out in Appendix V to this letter.

2.8. Should one or more acceding countries not join the European Union the adjustments calculated for this or these countries shall be deducted from the limits set out in Appendices I and V to this letter and the respective amendments mentioned under points 2.1 and 2.3 shall not enter into force.

2.9. Notwithstanding the modifications referred to under points 2.4, 2.5 and 2.6, during a transitional period that will end on 30 June 1995, the competent authorities of the People's Republic of China shall be authorized to continue issuing the forms that were in use in 1994.

2.10. Should inaccuracies appear in the trade figures used to establish the adjustments contained in Appendices I and V, technical revisions of these adjustments will be made following consultations and provided that the request for consultations is made not later than 28 February 1995.

3. I should be obliged if you could kindly confirm the acceptance of your Government of the foregoing. Should this be the case, this Agreement in the form of an exchange of letters shall enter into force on the first day of the month following the day on which the Parties have notified each other that the legal procedures necessary to this end have been completed. In the meantime, it shall be applied provisionally from 1 January 1995 on the conditions to be specified in an exchange of notes (see Appendix VI).

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

For the Council of the European Union

Appendix I replacing Annex III

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Appendix II

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Appendix III

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Appendix IV

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Appendix V replacing Annex to Protocol E

OUTWARD PROCESSING TRAFFIC Community quantitative limits

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Appendix VI

Exchange of notes

The Directorate-General for External Economic Relations of the Commission of the European Communities presents its compliments to the Mission of the People's Republic of China to the European Communities and has the honour to refer to the Agreement on trade in textile products between the People's Republic of China and the European Economic Community initialled on 9 December 1988, as amended and extended by the exchange of letters initialled on 8 December 1992 and to the modifications to be brought to this Agreement by the Agreement in the form of an exchange of letters initialled on 14 December 1994.

The Directorate-General wishes to inform the Mission of the People's Republic of China that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the adapted Agreement, the European Community is prepared to allow the provisions of the Agreement to apply de facto from 1 January 1995. This is on the understanding that either Party may at any time terminate this de facto application of the adapted Agreement provided that one hundred and twenty days notice is given.

The Directorate-General for External Economic Relations would be grateful if the Mission of the People's Republic of China would confirm its agreement to the foregoing.

The Directorate-General for External Economic Relations of the Commission of the European Communities avails itself of this opportunity to renew to the Mission of the People's Republic of China to the European Communities the assurance of its highest consideration.

Letter from the Government of the People's Republic of China

Sir,

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

'Sir,

1. I have the honour to refer to the Agreement between the European Economic Community and the People's Republic of China on trade in textile products initialled on 9 December 1988, as last amended and extended by the exchange of letters initialled on 8 December 1992.

2. In order to take into account the likely accession of the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the European Union on 1 January 1995, the European Community considers that the following amendments should be made to the Agreement between the European Economic Community and the People's Republic of China on trade in textile products:

2.1. The following text is added after Article 6, paragraph 2:

"For the purposes of applying the provisions of paragraph 2 in the year 1995, the preceding year's total imports from all third countries shall be calculated on the basis of imports into the Community as constituted on 31 December 1994 and of imports into Austria, Finland and Sweden. Trade between the Community, Austria, Finland and Sweden, or between Austria, Finland and Sweden shall be excluded from this total."

2.2 Figures in Annex III which set out the quantitative limits for exports from the People's Republic of China to the European Union are to be replaced on 31 December 1994 by limits for the enlarged Community as set out in Appendix I to this letter.

2.3. Article 14, paragraph 2, subparagraph 2, second indent of Protocol A, Title IV should be amended as follows:

"- two letters identifying the intended Member State of customs clearance as follows:

AT = Austria

BL = Benelux

DE = Federal Republic of Germany

DK = Denmark

EL = Greece

ES = Spain

FI = Finland

FR = France

GB = United Kingdom

IE = Ireland

IT = Italy

PT = Portugal

SE = Sweden"

2.4. The Annex of Protocol A, setting out the model of the certificate of origin is replaced by Appendix II to this letter.

2.5. The Annex to Protocol A setting out the model of the export licence is replaced by Appendix III to this letter.

2.6. The Annex to Protocol B setting out the model of the certificate applicable to certain cottage industry and folklore products is replaced by Appendix IV to this letter.

2.7. Figures in the Annex to Protocol E which set out the quantitative limits for economic outward processing operations are to be replaced on 31 December 1994 by limits for the enlarged Community as set out in Appendix V to this letter.

2.8. Should one or more acceding countries not join the European Union the adjustments calculated for this or these countries shall be deducted from the limits set out in Appendices I and V to this letter and the respective amendments mentioned under points 2.1 and 2.3 shall not enter into force.

2.9. Notwithstanding the modifications referred to under points 2.4, 2.5 and 2.6, during a transitional period that will end on 30 June 1995, the competent authorities of the People's Republic of China shall be authorized to continue issuing the forms that were in use in 1994.

2.10. Should inaccuracies appear in the trade figures used to establish the adjustments contained in Appendices I and V, technical revisions of these adjustments will be made following consultations and provided that the request for consultations is made not later than 28 February 1995.

3. I should be obliged if you could kindly confirm the acceptance of your Government of the foregoing. Should this be the case, this Agreement in the form of an exchange of letters shall enter into force on the first day of the month following the day on which the Parties have notified each other that the legal procedures necessary to this end have been completed. In the meantime, it shall be applied provisionally from 1 January 1995 on the conditions to be specified in an exchange of notes (see Appendix VI).

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

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 People's Republic of China

Appendix I replacing Annex III

>TABLE>

Appendix II

>

REFERENCE TO A FILM>

Appendix III

>REFERENCE TO A FILM>

Appendix IV

>REFERENCE TO A FILM>

Appendix V replacing Annex to Protocol E

OUTWARD PROCESSING TRAFFIC Community quantitative limits

>TABLE>

Appendix VI

Exchange of notes

The Directorate-General for External Economic Relations of the Commission of the European Communities presents its compliments to the Mission of the People's Republic of China to the European Communities and has the honour to refer to the Agreement on trade in textile products between the People's Republic of China and the European Economic Community initialled on 9 December 1988, as amended and extended by the exchange of letters initialled on 8 December 1992 and to the modifications to be brought to this Agreement by the Agreement in the form of an exchange of letters initialled on 14 December 1994.

The Directorate-General wishes to inform the Mission of the People's Republic of China that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the adapted Agreement, the European Community is prepared to allow the provisions of the Agreement to apply de facto from 1 January 1995. This is on the understanding that either Party may at any time terminate this de facto application of the adapted Agreement provided that one hundred and twenty days notice is given.

The Directorate-General for External Economic Relations would be grateful if the Mission of the People's Republic of China would confirm its agreement to the foregoing.

The Directorate-General for External Economic Relations of the Commission of the European Communities avails itself of this opportunity to renew to the Mission of the People's Republic of China to the European Communities the assurance of its highest consideration.