AGREEMENT

on mutual recognition of OECD principles of good laboratory practice (GLP) and compliance monitoring programmes between the European Community and the State of Israel

THE EUROPEAN COMMUNITY (hereinafter referred to as "the Community"),

on the one hand, and

THE STATE OF ISRAEL (hereinafter referred to as "Israel")

on the other hand,

THE TWO PARTIES subsequently referred to as the "Contracting Parties",

HAVING REGARD TO their obligations under the World Trade Organisation (WTO) and the WTO Agreement on technical barriers to trade, and especially to Annex I-C thereof, concerning the protection of intellectual property,

HAVING REGARD TO the OECD Council Decision of 12 May 1981 on mutual acceptance of data for the evalutation of chemicals,

HAVING REGARD TO the OECD Council Decision-Recommendation of 2 October 1989 on compliance with principles of good laboratory practice (C(89)87(final)),

HAVING REGARD to the Agreement on the European Economic Area of 2 May 1992 that establishes a zone of free circulation of goods, services, people and capital between the European Community and Iceland, Liechtenstein and Norway and especially to its 12th Protocol,

AFFIRMING the need to ensure the high quality, validity and reliability of health and environmental data generated during the testing of cosmetics, industrial chemicals, pharmaceuticals, food additives, animal feed additives, pesticides (hereinafter referred to as chemicals),

NOTING that in the absence of a national GLP monitoring authority in Israel, there is a need for transitional arrangements during an initial period during which Israel will set up this authority,

HAVE AGREED AS FOLLOWS:

Article 1

Definitions

1. Unless specific definitions are given, the definition of terms in the "OECD principles of good laboratory practice" (Annex II to OECD Council Decision (C(81)30(final)), the "Guides for compliance monitoring procedures for good laboratory practice" (Annex I to Council Decision-Recommendation (C(89)87(final)), the "Application of the good laboratory practice principles to field studies" (GLP consensus document, OECD series on principles of good laboratory practice and compliance monitoring), and all amendments made thereto shall apply.

2. "Accept" means that the receiving authorities will be obliged to recognise studies and data generated therefrom, from the other party on products subject to this Agreement under the same conditions as data generated on their own territory, provided that:

- the study was conducted by a test facility located on the territory of the Contracting Parties,

- the study is performed by a test facility that has been judged to operate in compliance with the good laboratory practice principles by the relevant national good laboraory practice monitoring Authorities.

3. "Monitoring authority": a management body with responsibility for monitoring the good laboratory practice compliance of test facilities within the territory of its administration and for discharging other such functions related to good laboratory practice as may be nationally determined.

Article 2

Scope

1. The Contracting Parties shall ensure the high quality, validity and reliability of safety evaluation data obtained during non-clinical testing on all chemicals as identified in Annex I before they are placed on the market.

2. The Contracting Parties shall recognise the equivalence of each others' compliance monitoring programmes on GLP that are in accordance with the principles referred to in Article 3(1).

3. Each Contracting Party shall accept studies and data generated therefrom, on the entirety of their territory as defined in Article 15, produced by the test facilities located on the territory of the other Contracting Party provided they participate in the GLP compliance monitoring programme of that Party in accordance with the principles referred to in Article 3(1).

4. Under the terms of this Agreement, the studies and the data generated therefrom, shall be used by the Contracting Parties for consideration in any administrative action to allow placing on the market of all chemicals as defined in Annex I.

Article 3

Basis of reference

1. For the purposes of this Agreement, the following conditions shall be fulfilled:

- the principles of good laboratory practice shall be in conformity with those adopted by the OECD in its Decision of 12 may 1981 on mutual acceptance of data for the evaluation of chemicals (C(81)30(final)) and all amendments made thereto,

- the provisions regarding test facility inspection and study audits shall be in conformity with those adopted by the Council of the OECD in Annexes I to III to the 1989 Decision-Recommendation (C(89)87(final)), that has been modified by its Decision-Recommendation of 9 March 1995 (C(95)8(final)), and all amendments made thereto,

- the test facilities shall be recognised to be in conformity with good laboratory practice in accordance with the principles applicable respectively in the EC and Israel.

2. The Contracting Parties shall inform each other in a timely manner of changes to their legislation that may affect good laboratory practice compliance standards or programmes.

Article 4

Ambit

This Agreement applies to studies conducted by test facilities on all chemicals either substances or preparations, as identified in Annex I, and to data generated therefrom. Modifications to that Annex shall be decided by the Joint Committee referred to in Article 10.

Article 5

Monitoring authorities

1. The authorities empowered or designated in their respective territories to verify the conformity of the test facilities with the principles of good laboratory practice are listed in Annex II to this Agreement.

2. The Contracting Parties shall inform and consult each other with regard to any further authorities which they wish to be included in this Agreement. Modifications to Annex II, by either adding or withdrawing authorities, shall be decided by the Joint Committee referred to in Article 10.

Article 6

Information about GLP-recognised test facilities

1. The Contracting Parties shall provide each other at least annually with a list of the test facilities on their territory, which in the light of the results of the inspections and study audits conform to good laboratory practice, as well as of the dates of inspection or audit and their compliance status.

2. The Contracting Parties shall inform each other promptly when a test facility coming under the terms of paragraph 1, which states that it applies good laboratory practice, fails to conform to such practice to an extent which may jeopardise the integrity or authenticity of any studies it conducts.

3. The Contracting Parties shall provide each other promptly with the information referred to in paragraph 1 about test facilities that in the light of the results of the inspections and study audits conform to good laboratory practice but have yet not been included in the list referred to in that paragraph.

Article 7

Additional actions

1. The Contracting Parties shall supply each other with any necessary additional information on a test facility inspection or study audit in response to a reasonable request from the other party.

2. Each Contracting Party may request further test facility inspection or study audits on the other party's territory if there is a documented doubt as to wheter a test was conducted in accordance with good laboratory practice.

3. If in exceptional cases doubts persist and the requesting party can justify a special concern, and with the consent of the test facility concerned, it may designate one or more expets of its authorities to participate in a test facility inspection or the audit of a study conducted by the authorities of the other party.

Article 8

Confidentiality

1. The Contracting Parties shall make provision for the maintenance of confidentiality, not only by inspectors but also by any other persons who gain access to confidential information as a result of GLP compliance monitoring activities.

2. The Contracting Parties shall ensure that, unless all commercially sensitive and confidential information has been excised, reports of test facility inspections and study audits are made available only to regulatory authorities and, where appropriate, to the test facilities inspected or concerned with study audits and/or to study sponsors. Test facilities can freely dispose of the reports of test facility inspection and study audits that concern them.

Article 9

Participation as observer

Each Contracting Party may, on request, participate as an observer in an inspection of a test facility conducted by the autorities of the other party with the consent of the test facility concerned in order to maintain a continuing understanding of the other party's inspection procedures.

Article 10

Joint Committee

1. A Joint Committee composed of representatives of both parties shall be established.

2. The Joint Committee shall meet in order to resolve problems resulting from possible differences of view and practice within the two parties, to ensure proper implementation of this Agreement and to seek opportunities for further cooperation.

TRANSITIONAL PROVISIONS

Article 11

For an initial period, as a transitional arrangement, of a maximum of two years starting after the entry into force of this Agreement, the following provisions shall apply.

1. Israel shall establish during this period a ntional GLP monitoring system.

2. If there is no agreement between the parties that the above requirement has been met satisfactorily during the initial period, and if the two parties do not decide after a joint review to prolong the initial period, this Agreement ceases automatically to be valid.

3. The initial period may be terminated before the two-year period, provided the Community has acknowledged that the Israeli GLP monitoring system has entered into operation satisfactorily.

Article 12

During the initial period referred to in Article 11, the empowered authorities in the Community shall verify conformity of the test facilities with GLP in Israel, as described in the attached Agreed Minutes. The Community shall recognise any test facility found in conformity with GLP requirements.

Article 13

During the initial period referred to in Article 11, Israel shall accept the data coming from GLP recognised test facilities in the Community and the Community shall accept data coming from the Israeli test facilities GLP recognised by it acording to Article 12.

FINAL PROVISIONS

Article 14

Either party may terminate this Agreement by giving the other party six months notice in writing.

Article 15

This Agreement shall apply, on the one and, to the territories in which the Treaty establishing the European Community is applied and under the conditions laid down in that Treaty and, on the other hand, to the territory of the State of Israel.

Article 16

This Agreement shall be approved or ratified by the parties in accordance with their own procedures. It shall enter into force on the first day of the second month following the date on which the parties have exchanged notes confirming the completion of the respective procedures for the entry into force of this Agreement.

This Agreement is drawn up in two originals in the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish, Swedish and Hebrew languages, each of these languages being equally authentic.

In witness whereof the undersigned, being duly authorised, have signed this Agreement.

For the Government of the State of Israel

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For the European Community

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ANNEX I

LIST OF CHEMICALS COVERED BY THE AGREEMENT ON MUTUAL RECOGNITION OF THE OECD PRINCIPLES OF GOOD LABORATORY PRACTICE AND COMPLIANCE MONITORING PROGRAMMES BETWEEN THE EUROPEAN COMMUNITY AND THE STATE OF ISRAEL

Chemicals, either substance or preparations, covered in the Agreement on mutual recognition of the OECD principles of good laboratory practice between the European Community and the State of Israel are:

- cosmetics,

- industrial chemicals,

- medicinal products/pharmaceuticals,

- food additives,

- animal feed additives,

- pesticides.

These chemicals are defined by the legal instruments of the country of destination, which are:

FOR THE EUROPEAN COMMUNITY:

1. Council Directive 87/18/EEC of 18 December 1986 on the harmonisation of laws, regulations and administrative provisions relating to the application of the principles of good laboratory practice and the verification of their applications for tests on chemical substances (OJ L 15, 17.1.1987, p. 29) as last amended by Commission Directive 1999/11/EC (OJ L 77, 23.3.1999, p. 8).

2. Council Directive 88/320/EEC of 9 June 1998 on the inspection and verification of good laboratory practice (GLP) (OJ L 145, 11.6.1998, p. 35) as last amended by Commission Directive 1999/12/EC (OJ L 77, 23.3.1999, p. 22).

3. Council Directive 92/32/EEC of 30 April 1992 amending for the seventh time Directive 67/548/EEC on the approximation of the laws, regulations and administrative provisions relating to the classification, packaging and labelling of dangerous substances (OJ L 154, 5.6.1992, p. 1).

4. Council Directive 88/379/EEC of 7 June 1998 on the approximation of the laws, regulations and administrative provisions of the Member States relating to the classification, packaging and labelling of dangerous preparations (OJ L 187, 16.7.1988, p. 14).

5. Council Regulation (EEC) No 793/93 of 23 March 1993 on the evaluation and control of the risks of existing substances (OJ L 84, 5.4.1993, p. 1).

6. Council Directive 87/19/EEC of 22 December 1996 amending Directive 75/318/EEC on the approximation of the laws of the Member States relating to analytical, pharmacotoxicological and clinical standards and protocols in respect of the testing of proprietary medicinal products (OJ L 15, 17.1.1987, p 31).

7. Commission Directive 91/507/EEC of 19 July 1991 modifying the Anenx to Council Directive 75/318/EEC on the approximation of the laws of Member States relating to analytical, pharmacotoxicological and clinical standards and protocols in respect of the testing of medicinal products (OJ L 270, 26.9.1991, p. 32).

8. Council Directive 87/20/EEC of 22 December 1986 amending Directive 81/852/EEC on the approximation of the laws of the Member States relating to analytical, pharmacotoxicological and clinical standards and protocols in respect of the testing of veterinary medicinal products (OJ L 15, 17.1.1987, p. 34).

9. Council Directive 92/18/EEC of 20 March 1992 modifying the Annex to Council Directive 81/852/EEC on the approximation of the laws of Member States relating to analytical, pharmacotoxicological and clinical standards and protocols in respect of the testing of veterinary medicinal products (OJ L 97, 10.4.1992, p. 1).

10. Council Directive 89/397/EC of 14 June 1989 on the official control of foodstuffs (OJ L 186, 30.6.1989, p. 23).

11. Council Directive 93/99/EEC of 29 October 1993 on the subject of additional measures concerning the official control of foodstuffs (OJ L 290, 24.11.1993, p. 14).

12. Council Directive 87/153/EEC of 16 February 1987 fixing guidelines for the assessment of additives in animal nutrition (OJ L 64, 7.3.1987, p. 19) as amended by Commission Directive 95/11/EC (OJ L 106, 11.5.1995, p. 23).

13. Council Directive 91/414/EEC of 15 July 1991 concerning the placing of plant protection products on the market (OJ L 230, 19.8.1991, p. 1) as last amended by Commission Directive 95/35/EC (OJ L 172, 22.7.1995, p. 6).

14. Directive 98/8/EC of the European Parliament and of the Council of 16 February 1998 concerning the placing of biocidal products on the market (OJ L 123, 24.4.1998, p. 1).

15. Council Directive 93/35/EEC of 14 June 1993 amending for the sixth time Directive 76/68/EEC on the approximation of the laws of the Member States relating to cosmetic products (OJ L 151, 23.6.1993, p. 32).

ISRAELI LAWS AND REGULATIONS

(UNOFFICIAL TRANSLATION)

Drugs

Pharmacists Ordinance (New Version) - 1981

Pharmacist Regulations (Medical Preparations) - 1986

Food additives

Public Health Ordinance (Food) (new version) - 1983

Public Health Regulations (Food) (bases of emulsifier and stabilisers in food products) - 1966

Public Health Regulations (Food) (dietic food and sweeteners) - 1987

Public Health Regulations (Food) (vitamin and mineral additives in food) - 1983

Public Health Regulations (Food) (food colouring) 1984

Public Health Regulations (Food) (sealing of food packaging) - 1993

Public Health Regulations (Food) (pesticide traces) - 1991

Public Health Regulations (Food) (aflatoxins in food) - 1989

Public Health Regulations (Food) (provisions of findings) - 1980

Public Health Regulations (Food) (labelling) - 1935

Public Health Regulations (Food) (nutritional labelling) - 1993

Public Health Regulations (Food) (food products preservation through radiation) - 1988

Common Health Ordinance - 1942

Common Health Regulations (sanitary quality of drinking water) - 1977

Common Health Regulations (mineral and spring water) - 1987

Common Health Regulations (method of taking samples and their transfer for testing) - 1957

Common Health Regulations (preservative bases in food (foods) - 1965

Commodities and Services Control Law - 1957

Commodities and Services Control Order (quality of food) - 1958

Commodities and Services Control Order (production of food products) - 1976

Commodities and Services Control Order (labelling of food additives) - 1968

Animal feed additives

Commodities and Services Contrrol Order (production and sale of fodder) - 1971

Animal Disease Ordinance (new version) - 1985

Animal Disease Regualtions (chemical preparations) - 1982

Pesticides

Commodities and Services Control Order (pesticide preparations against hazards to humans) - 1962

Hazardous Substances Regulations (regulation of pesticide preparations against hazards to humans) - 1994

Plant Protection Law - 1956

Plant Protection Regulations (regulation of import and sale of chemical preparations) - 1994

Agricultural Fertilisers Ordinance - 1938

Agricultural Fertilisers Regulations - 1938

Cosmetics

Commodities and Services Control Order (cosmetics) - 1973

Industrial chemicals

Hazardous Substances Law - 1993

Hazardous Substances Regulations - 1994

Hazardous Substances Regulations (import and export of hazardous substances waste) - 1994

Hazardous Substances Regulations (classification and exemption) - 1996

ANNEX II

LIST OF MONITORING AUTHORITIES

>TABLE>

ANNEX III

AGREED MINUTES

concerning the Agreement on mutual recognition of OECD principles of good laboratory practice (GLP) and compliance monitoring programmes between the European Community and the State of Israel

Having regard to the Transitional Provisions of the Agreement on mutual recognition of OECP principles of good Laboratory practice (GLP) between the European Community (EC) and the State of Israel, the Contracting Parties state as follows:

TEST FACILITIES CONCERNED

- The list of test facilities that Israel wants to be GLP recognised is annexed to the present minute.

PRELIMINARY MISSION

- Before the signature of the Agreement, a preliminary mission of two experts of the EC will take place in order to:

- assess the state of affairs concerning the test facilities in Annex that eventually could be GLP recognised,

- give their advice for the setting up of the national GLP monitoring authority,

- Both parties agree to accept the findings of the report of the experts concerning the above mission as submitted.

INITIAL PERIOD

- All inspections during the initial period will be performed by at least two inspectors designated by the EC.

The reports of these inspections will be sent by the inspectors to the test facility concerned and, in addition, to the authorities of the Contracting Parties(1),

- inspections will start as soon as possible after the signature of the Agreement and on request of the Israeli Authorities, in order to inspect the test facilities interested to be GLP recognised,

- all the costs pertaining to the missions, both the preliminary mission and the inspections during the initial period, will be supported by the State of Israel.

For the Government of the State of Israel

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For the European Community

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(1) European Commission

DG I/M/2

Rue de la Loi/Wetstraat 200 B - 1049 Bruxelles/Brussel Israel Laboratory

Accreditation Authority

Habonim Street, 2 Ramat Gan 52522 ( Israel )

ANNEX IV

ISRAELI TEST FACILITIES CANDIDATES TO BE GLP RECOGNISED

1. AGAN CHEMICAL MANUFACTURERS LTD

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2. AMINOLAB LTD ANALYTICAL LABORATORY SERVICES

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3. ANALYST RESEARCH LABORATORIES

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4. HARLAN BIOTEC ISRAEL LTD

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