JOINT COMMITTEE DECISION No 2/76 amending Protocol No 3 of the Agreement between the European Economic Community and the State of Israel

THE JOINT COMMITTEE,

Having regard to the Agreement between the European Economic Community and the State of Israel, and in particular Title I thereof,

Having regard to Protocol No 3 concerning the application of Article 2 (3) of the Agreement, and in particular Article 24 thereof,

Whereas it is necessary, for the proper working of the Agreement, to organize close administrative cooperation between the contracting parties to the Agreement to ensure that its customs provisions are correctly applied, and in particular those contained in Protocol No 3;

Whereas it is convenient to consolidate all the provisions concerning the origin of goods;

Whereas Article 23 of Protocol No 3 should be deleted,

HAS DECIDED AS FOLLOWS:

Sole Article

The text of Protocol No 3 concerning the application of Article 2 (3) of the Agreement is hereby replaced by the text annexed to this Decision.

Done at Jerusalem, 7 June 1976.

For the Joint Committee

The President

E. BEN-HORIN

ANNEX

TITLE I

Definition of the concept of 'originating products'

Article 1

For the purpose of implementing the Agreement, the following products, on condition that they were transported directly within the meaning of Article 5, shall be considered as:

1. products originating in Israel:

(a) products wholly obtained in Israel;

(b) products obtained in Israel, in the manufacture of which products other than those wholly obtained in Israel are used, provided that the said products have undergone sufficient working or processing within the meaning of Article 3. This condition shall not apply, however, to products which, within the meaning of this Protocol, originate in the Community;

2. products originating in the Community:

(a) products wholly obtained in the Community;

(b) products obtained in the Community, in the manufacture of which products other than those wholly obtained in the Community are used, provided that the said products have undergone sufficient working or processing within the meaning of Article 3. This condition shall not apply, however, to products which, within the meaning of this Protocol, originate in Israel.

The products in List C in Annex IV shall be temporarily excluded from the scope of this Protocol.

Article 2

The following shall be considered as 'wholly obtained' either in Israel or in the Community, within the meaning of Article 1 (1) (a) and (2) (a):

(a) mineral products extracted from their soil or from their seabed;

(b) vegetable products harvested there;

(c) live animals born and raised there;

(d) products from live animals raised there;

(e) products obtained by hunting or fishing conducted there;

(f) products of sea fishing and other products taken from the sea by their vessels;

(g) products made aboard their factory ships exclusively from products referred to in subparagraph (f);

(h) used articles collected there fit only for the recovery of raw materials;

(i) waste and scrap resulting from manufacturing operations conducted there;

(j) goods produced there exclusively from products specified in subparagraphs (a) to (i).

Article 3

1. For the purpose of implementing the provisions of Article 1 (1) (b) and (2) (b), the following shall be considered as sufficient working or processing:

(a) working or processing as a result of which the goods obtained receive a classification under a heading other than that covering each of the products worked or processed, except however, working or processing specified in List A in Annex II, where the special provisions of that list apply;

(b) working or processing specified in List B in Annex III.

'Sections', 'Chapters' and 'headings' shall mean the Sections, Chapters and headings in the Brussels Nomenclature for the Classification of Goods in Customs Tariffs.

2. When, for a given product obtained, a percentage rule limits in List A and List B the value of the materials and parts which can be used, the total value of these materials and parts, whether or not they have changed heading in the course of the working, processing or assembly within the limits and under the conditions laid down in each of those two lists, may not exceed, in relation to the value of the product obtained, the value corresponding either to the common rate, if the rates are identical in both lists, or to the higher of the two if they are different.

3. For the purpose of implementing Article 1 (1) (b) and (2) (b), the following shall always be considered as insufficient working or processing to confer the status of originating product, whether or not there is a change of heading:

(a) operations to ensure the preservation of merchandise in good condition during transport and storage (ventilation, spreading out, drying, chilling, placing in salt, sulphur dioxide or other aqueous solutions, removal of damaged parts, and like operations);

(b) simple operations consisting of removal of dust, sifting or screening, sorting, classifying, matching (including the making up of sets of articles), washing, painting, cutting up;

(c) (i) changes of packaging and breaking up and assembly of consignments;

(ii) simple placing in bottles, flasks, bags, cases, boxes, fixing on cards or boards, etc., and all other simple packaging operations;

(d) affixing marks, labels or other like distinguishing signs on products or their packaging;

(e) simple mixing of products, whether or not of different kinds, where one or more components of the mixture do not meet the conditions laid down in this Protocol to enable them to be considered as originating;

(f) simple assembly of parts of articles to constitute a complete article;

(g) a combination of two or more operations specified in subparagraphs (a) to (f);

(h) slaughter of animals.

Article 4

Where the Lists A and B referred to in Article 3 provide that goods obtained in Israel or in the Community shall be considered as originating therein only if the value of the products worked or processed does not exceed a given percentage of the value of the goods obtained, the values to be taken into consideration for such a percentage shall be:

- on the one hand,

as regards products whose importation can be proved: their customs value at the time of importation,

as regards products of undertermined origin: the earliest ascertainable price paid for such products in the territory of the Contracting Party where manufacture takes place,

- and on the other hand,

the ex-works price of the goods obtained, less internal taxes refunded or refundable on exportation.

Article 5

1. For the purpose of implementing Article 1, originating products whose transport is effected without entering into territory other than that of the Contracting Parties are considered as transported directly from Israel to the Community or from the Community to Israel. However, goods originating in Israel or in the Community and constituting one single consignment which is not split up may be transported through territory other than that of the Contracting Parties with, should the occasion arise, transhipment or temporary warehousing in such territory, provided that the crossing of the latter territory is justified for geographical reasons and that the goods have remained under the surveillance of the Customs Authorities in the country of transit or warehousing, that they have not entered into commerce of such countries nor been delivered for home use there and have not undergone operations other than unloading, reloading or any operation designed to maintain them in good condition.

2. Evidence that the conditions referred to in paragraph 1 have been fulfilled shall be supplied to the responsible customs authorities in the Community or in Israel by the production of:

(a) a through bill of lading issued in the exporting country covering the passage through the country of transit; or

(b) a certificate issued by the customs authorities of the country of transit:

- giving an exact description of the goods,

- stating the dates of unloading and reloading of the goods or of their embarkation or disembarkation, identifying the ships used,

- certifying the conditions under which the goods remained in the transit country;

(c) or failing these, any substantiating documents.

TITLE II

Arrangements for administrative cooperation

Article 6

1. Evidence of originating status, within the meaning of this Protocol, of products is given by a movement certificate EUR.1 of which a specimen is given in Annex V to this Protocol.

However, the evidence of originating status, within the meaning of this Protocol, of products which form the subject of postal consignments (including parcels), provided that they consist only of originating products and that the value does not exceed 1 000 units of account per consignment, may be given by a form EUR.2, of which a specimen is given in Annex VI to this Protocol.

The unit of account (u.a.) has a value of 0 88867088 gram of fine gold. Should the unit of account be changed, the Contracting Parties shall make contact with each other at the level of the Joint Committee to redefine the value in terms of gold.

2. Without prejudice to Article 3 (3), where, at the request of the person declaring the goods at the customs, a dismantled or non-assembled article falling within Chapters 84 or 85 of the Brussels Nomenclature is imported by instalments on the conditions laid down by the competent authorities, it shall be considered to be a single article and a movement certificate may be submitted for the whole article upon importation of the first instalment.

3. Accessories, spare parts and tools dispatched with a piece of equipment, machine, apparatus or vehicle which are part of the normal equipment and included in the price thereof or are not separately invoiced are regarded as one with the piece of equipment, machine, apparatus or vehicle in question.

Article 7

1. A movement certificate EUR.1 shall be issued by the customs authorities of the exporting State when the goods to which is relates are exported. It shall be made available to the exporter as soon as actual exportation has been effected or ensured.

2. In exceptional circumstances a movement certificate EUR.1 may also be issued after exportation of the goods to which it relates if it was not issued at the time of exportation because of errors or involuntary omissions or special circumstances. In this case, the certificate shall bear a special reference to the conditions in which it was issued.

3. A movement certificate EUR.1 shall be issued only on application having been made in writing by the exporter. Such application shall be made on a form, of which a specimen is given in Annex V to this Protocol, which shall be completed in accordance with this Protocol.

4. A movement certificate EUR.1 may be issued only where it can serve as the documentary evidence required for the purpose of implementing the Agreement.

5. Applications for movement certificates EUR.1 must be preserved for at least two years by the customs authorities of the exporting country.

Article 8

1. The movement certificate EUR.1 shall be issued by the customs authorities of the exporting State, if the goods can be considered 'originating products' within the meaning of this Protocol.

2. For the purpose of verifying whether the conditions stated in paragraph 1 have been met, the customs authorities shall have the right to call for any documentary evidence or to carry out any check which they consider appropriate.

3. It shall be the responsibility of the customs authorities of the exporting State to ensure that the forms referred to in Article 9 are duly completed. In particular, they shall check whether the space reserved for the description of the goods has been completed in such a manner as to exclude all possibility of fraudulent additions. To this end, the description of the goods must be indicated without leaving any blank lines. Where the space is not completely filled a horizontal line must be drawn below the last line of the description, the empty space being crossed through.

4. The date of issue of the movement certificate must be indicate in the part of the certificate reserved for the customs authorities.

Article 9

Movement certificates EUR.1 shall be made out on the form of which a specimen is given in Annex V to this Protocol. This form shall be printed in one or more of the languages in which the Agreement is drawn up. Certificates shall be made out in one of these languages and in accordance with the provisions of the domestic law of the exporting State; if they are handwritten, they shall be completed in ink and in capital letters.

Each certificate shall measure 210 x 297 mm a tolerance of up to plus 8 mm or minus 5 mm in the length may be allowed. The paper used must be white-sized writing paper not containing mechanical pulp and weighing not less than 25 g/m². It shall have a printed green guilloche pattern background making any falsification by mechanical or chemical means apparent to the eye.

The exporting States may reserve the right to print the certificates themselves or may have them printed by approved printers. In the latter case, each certificate must include a reference to such approval. Each certificate must bear the name and address of the printer or a mark by which the printer can be identified. It shall also bear a serial number, either printed or not, by which it can be identified.

Article 10

1. Under the responsibility of the exporter, he or his authorized representative shall request the issue of a movement certificate EUR.1.

2. The exporter or his representative shall submit with his request any appropriate supporting document proving that the goods to be exported are such as to qualify for the issue of a movement certificate EUR.1.

Article 11

A movement certificate EUR.1 must be submitted, within five months of the date of issue by the customs authorities of the exporting State, to the customs authorities of the importing State where the goods are entered.

Article 12

Movement certificates EUR.1 shall be submitted to customs authorities in the importing State, in accordance with the procedures laid down by that State. The said authorities may require a translation of a certificate. They may also require the import declaration to be accompanied by a statement from the importer to the effect that the goods meet the conditions required for the implementation of the Agreement.

Article 13

1. A movement certificate EUR.1 which is submitted to the customs authorities of the importing State after the final date for presentation specified in Article 11 may be accepted for the purpose of applying preferential treatment where the failure to submit the certificate by the final date set is due to reasons of force majeure or exceptional circumstances.

2. In other cases of belated presentation, the customs authorities of the importing State may accept the certificates where the goods have been submitted to them before the said final date.

Article 14

The discovery of slight discrepancies between the statements made in the movement certificate EUR.1 and those made in the documents submitted to the customs office for the purpose of carrying out the formalities for importing the goods shall not ipso facto render the certificate null and void if it is duly established that the certificate does correspond to the goods submitted.

Article 15

It shall always be possible to replace one or more movement certificates EUR.1 by one or more other movement certificates EUR.1 provided that this is done at the customs office where the goods are located.

Article 16

Form EUR.2, a specimen of which is given in Annex VI, shall be completed by the exporter or, under his responsibility, by his authorized representative. It shall be made out in one of the languages in which the Agreement is drawn up and in accordance with the provisions of the domestic law of the exporting State. If it is handwritten it must be completed in ink and in capital letters. If the goods contained in the consignment have already been subject to verification in the exporting country by reference to the definition of the concept of 'originating products' the exporter may refer to this check in the 'Remarks' box of form EUR.2.

Form EUR.2 shall be 210 x 148 mm. A tolerance of up to plus 8 mm or minus 5 mm in the length may be allowed. The paper used shall be white paper dressed for writing not containing mechanical pulp and weighing not less than 64 g/m².

The exporting States may reserve the right to print the forms themselves or may have them printed by printers they have approved. In the latter case each form must include a reference to such approval. In addition, the form must bear the distinctive sign attributed to the approved printer and a serial number, either printed or not, by which it can be identified.

A form EUR.2 shall be completed for each postal consignment.

These provisions do not exempt exporters from complying with any other formalities required by customs or postal regulations.

Article 17

1. Goods sent as small packages to private persons or forming part of travellers' personal luggage shall be admitted as originating products without requiring the production of a movement certificate EUR.1 or the completion of a form EUR.2, provided that such goods are not imported by way of trade and have been declared as meeting the conditions required for the application of this Protocol, and where there is no doubt as to the veracity of such declaration.

2. Importations which are occasional and consist solely of goods for the personal use of the recipients or travellers or their families shall not be considered as importations by way of trade if it is evident from the nature and quantity of the goods that no commercial purpose is in view. Furthermore, the total value of theese goods must not exceed 60 units of account in the case of small packages or 200 units of account in the case of the contents of travellers' personal luggage.

Article 18

1. Goods sent from the Community or from Israel for exhibition in another country and sold after the exhibition for importation into Israel or into the Community shall benefit on importation from the provisions of the Agreement on condition that the goods meet the requirements of this Protocol entitling them to be recognized as originating in the Community or in Israel and provided that it is shown to the satisfaction of the customs authorities that:

(a) an exporter has consigned these goods from the Community or from Israel to the country in which the exhibition is held and has exhibited them there;

(b) the goods have been sold or otherwise disposed of by that exporter to someone in Israel or in the Community;

(c) the goods have been consigned during the exhibition or immediately thereafter to Israel or to the Community in the state in which they were sent for exhibition;

(d) the goods have not, since they were consigned for exhibition, been used for any purpose other than demonstration at the exhibition.

2. A movement certificate EUR.1 must be produced to the Customs authorities in the normal manner. The name and address of the exhibition must be indicated thereon. Where necessary, additional documentary evidence of the nature of the goods and the conditions under which they have been exhibited may be required.

3. Paragraph 1 shall apply to any trade, industrial, agricultural or crafts exhibition, fair or similar public show or display which is not organized for private purposes in shops or business premises with a view to the sale of foreign goods, and during which the goods remain under customs control.

Article 19

1. When a certificate is issued within the meaning of Article 7 (2) of this Protocol after the goods to which it relates have actually been exported, the exporter must in the application referred to in Article 7 (3) of this Protocol:

- indicate the place and date of exportation of the goods to which the certificate relates,

- certify that no movement certificate EUR.1 was issued at the time of exportation of the goods in question, and state the reasons.

2. The customs authorities may issue a movement certificate EUR.1 retrospectively only after verifying that the information supplied in the exporter's application agrees with that in the corresponding file.

Certificates issued retrospectively must be endorsed with one of the following phrases: 'NACHTRAEGLICH AUSGESTELLT', 'DELIVRE A POSTERIORI', 'RILASCIATO A POSTERIORI', 'AFGEGEVEN A POSTERIORI', 'ISSUED RETROSPECTIVELY', 'UDSTEDT EFTERFOELGENDE'.

Article 20

In the event of the theft, loss or destruction of a movement certificate EUR.1, the exporter may apply to the customs authorities which issued it for a duplicate made out on the basis of the export documents in their possession. The duplicate issued in this way must be indorsed with one of the following words: 'DUPLIKAT', 'DUPLICATA', 'DUPLICATO', 'DUPLICAAT', 'DUPLICATE'.

The duplicate, on which the date of the original movement certificate must be reproduced, shall take effect on that date.

Article 21

Israel and the Community shall take all nacessary steps to ensure that goods traded under cover of a movement certificate EUR.1, and which in the course of transport use a free zone situated in their territory, are not replaced by other goods and that they do not undergo handling other than normal operations designed to prevent their deterioration.

Article 22

In order to ensure the proper application of this Title, Israel and the Community shall assist each other, through their respective customs administrations, in checking the authenticity of movement certificates EUR.1 and the accuracy of the information concerning the actual origin of the products concerned and the declarations by exporters on forms EUR.2.

Article 23

Penalties shall be imposed on any person who, in order to enable goods to be accepted as eligible for preferential treatement, draws up or causes to be drawn up, either a document which contains incorrect particulars for the purpose of obtaining a movement certificate EUR.1 or a form EUR.2 containing incorrect particulars.

Article 24

1. Subsequent verifications of movement certificates EUR.1 and of forms EUR.2 shall be carried out at random or whenever the customs authorities of the importing State have reasonable doubt as to the authenticity of the document or the accuracy of the information regarding the true origin of the goods in question.

2. For the purpose of implementing paragraph 1, the customs authorities of the importing State shall return the movement certificate EUR.1 or the form EUR.2, or a photocopy thereof, to the customs authorities of the exporting State, giving, where appropriate, the reasons of form or substance for an inquiry. The invoice, if it has been submitted, or a copy thereof shall be attached to the form EUR.2 and the customs authorities shall forward any information that has been obtained suggesting that the particulars given on the said certificate on the said form are inaccurate.

If the customs authorities of the importing State decide to suspend execution of the Agreement while awaiting the results of the verification, they shall offer to release the goods to the importer subject to any precautionary measures judged necessary.

3. The customs authorities of the importing State shall be informed of the results of the verification as quickly as possible. These results must be such as to make it possible to determine whether the disputed movement certificate EUR.1 or form EUR.2 applies to the goods actually exported, and whether these goods can, in fact, qualify for the application of the preferential arrangements.

When such disputes cannot be settled between the customs authorities of the importing State and those of the exporting State, or when they raise a question as to the interpretation of this Protocol, they shall be submitted to the Customs Cooperation Committee.

In all cases the settlement of disputes between the importer and the customs authorities of the importing State shall be under the legislation of the said State.

Article 25

The Joint Committee may decide to amend the provisions of this Protocol.

Article 26

1. The Community and Israel shall take any measures necessary to enable movement certificates EUR.1 as well as forms EUR.2 to be submitted, in accordance with Articles 11 and 12 of this Protocol, from the day on which it enters into force.

2. The certificates of type A.IL.1. as well as forms A.IL.2. may be used until stocks are exhausted and at the latest up to and including 30 June 1977 under the conditions laid down by this Protocol.

3. The movement certificates EUR.1 and the forms EUR.2 printed in the Member States before the date of the entry into force of this Protocol, and which do not conform to the models in the Annexes V and VI of this Protocol, may continue to be used until stocks are exhausted, under the conditions laid down by this Protocol.

Article 27

The Community and Israel shall each take the steps necessary to implement this Protocol.

Article 28

The Annexes to this Protocol shall form an integral part of it.

Article 29

The endorsements referred to in Articles 19 and 20 shall be inserted in the 'Remarks' box of the certificate.

Article 30

1. Unless the Joint Committee decides otherwise, no drawback or remission of any kind may be granted from customs duties in the Community or in Israel in respect of products referred to in Article 1 of Protocols 1 and 2 and used in manufacture which do not originate in the Community or Israel sa from 1 January 1984.

2. In this and the following Articles, the term 'customs duties' also means charges having an equivalent effect to customs duties.

ANNEX I

EXPLANATORY NOTES

Note 1 - Articles 1 and 2

The terms 'the Community' or 'Israel' shall also cover the territorial waters of the Member States of the Community or of Israel respectively.

Vessels operating on the high seas, including factory ships, on which fish caught is worked or processed, shall be considered as part of the territory of the State to which they belong provided that they satisfy the conditions set out in Explanatory Note 5.

Note 2 - Article 1

In order to determine whether goods originate in the Community or in Israel it shall not be necessary to establish whether the power and fuel, plant and equipment, and machines and tools used to obtain such goods originate in third countries or not.

Note 3 - Article 3 (1) and (2) and Article 4

The percentage rule constitutes, where the product obtained appears in List A, a criterion additional to that of change of heading for any non-originating product used.

Note 4 - Article 1

Packing shall be considered as forming a whole with the goods contained therein. This provision, however, shall not apply to packing which is not of the normal type for the article packed and which has intrinsic utilization value and is a durable nature, apart from its function as packing.

Note 5 - Article 2 (f)

The term 'their vessels' shall apply only to vessels:

- which are registered or recorded in a Member State or in Israel,

- which sail under the flag of a Member State or of Israel,

- which are owned to an extent of at least 50% by nationals of the Member States and Israel or by a company with its head office in a Member State or in Israel, of which the manager, managers, chairman of the board of directors or of the supervisory board, and the majority of the members of such board, are nationals of the Member States or Israel and of which, in addition in the case of partnerships or limited companies, at least half the capital belongs to the Member States or Israel or to public bodies or nationals of the Member States or of Israel,

- of which the captain and officers are all nationals of the Member States or of Israel,

- of which at least 75% of the crew are nationals of the Member States or of Israel.

Note 6 - Article 4

'Ex-works price' shall mean the price paid to the manufacturer in whose undertaking the last working or processing is carried out, provided the price includes the value of all the products used in manufacture.

'Customs value' shall be understood as meaning the customs value laid down in the Convention concerning the Valuation of Goods for Customs Purposes signed in Brussels on 15 December 1950.

Note 7 - Article 30

'Drawback or remission of any kind from granted customs duties' shall mean any arrangement for refund or remission, partial or complete, of customs duties applicable to products used in manufacture, provided that the said provision concedes, expressly or in effect, the repayment or non-charging or the non-imposition when goods obtained from the said products are exported but not when they are retained for home use.

ANNEX II

LIST A

List of working or processing operations which result in a change of tariff heading without conferring the status of 'originating products' on the products undergoing such operations, or conferring this status only subject to certain conditions

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ANNEX III

LIST B

List of working or processing operations which do not result in a change of tariff heading,but which do confer the status of 'originating products' on the products undergoing such operations

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ANNEX IV

LIST C

List of products excluded from the scope of this Protocol

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