AGREEMENT in the form of an exchange of letters between the European Community and Hong Kong amending the Agreement between the European Economic Community and Hong Kong on trade in textile products to take into account the expected accession of the Republic of Austria, the Republic of Finland, the Kingdom of Norway 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 Hong Kong on trade in textile products initialled on 2 October 1986, as last amended and extended by the exchange of letters initialled on 3 November 1992.

2. In order to take into account the likely accession of the Republic of Austria, the Republic of Finland, the Kingdom of Norway 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 Hong Kong on trade in textile products:

2.1. Should the Uruguay Round Agreement on Textiles and Clothing become applicable in our relationships, Appendix I sets out the notional quantitative restrictions for the enlarged Community to be considered, for the purposes of notifying to the Textiles Monitoring Body, as those maintained by the enlarged Community and in force before the day of entry into force of the Uruguay Round Agreement on Textiles and Clothing, within the meaning of Article 2 of the Uruguay Round Agreement on Textiles and Clothing.

Should the Uruguay Round Agreement on Textiles and Clothing not become applicable in our relationships, Annex II of the Agreement which sets out the quantitative restrictions for exports from Hong Kong to the European Union is replaced for the period 1 January to 31 December 1995 by Appendix II to this letter.

2.2. Article 12, paragraph 2, subparagraph 2, second indent of Protocol A, Title III, Section II 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

NO = Norway

PT = Portugal

SE = Sweden`

2.3. 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 the Appendices to this letter and the respective amendments mentioned under point 2.2 shall not enter into force.

2.4. Should inaccuracies appear in the trade figures used to establish the adjustments contained in Appendices I and II, technical revisions of these adjustments will be made following consultations provided that the request for consultations is made no 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 III).

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

For the Council of the European Union

Appendix I

NOTIONAL COMMUNITY QUANTITATIVE LIMITS 1994 Direct quotas

>TABLE>

Appendix II

ANNEX II COMMUNITY QUANTITATIVE LIMITS 1995 Direct quotas

>TABLE>

Appendix III

Exchange of notes

Note 1

The Directorate-General for External Economic Relations of the Commission of the European Communities presents its compliments to the Special Representative of Hong Kong to the European Communities and has the honour to refer to the Agreement on trade in textile products between Hong Kong and the European Economic Community initialled on 2 October 1986 as amended and extended by the exchange of letters initialled on 3 November 1992 and to the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994.

The Directorate-General wishes to inform the Special Representative of Hong Kong that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the amended Agreement, the European Community is prepared to apply de facto from 1 January 1995 the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994. This is on the understanding that either Party may at any time terminate this de facto application of the amended Agreement provided that one hundred and twenty days notice is given.

The Directorate-General for External Economic Relations would be grateful if the Special Representative of Hong Kong would confirm his 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 Special Representative of Hong Kong to the European Communities the assurance of its highest consideration.

Note 2

The Special Representative of Hong Kong to the European Communities presents his compliments to the Directorate-General for External Economic Relations of the Commission of the European Communities and has the honour to refer to the Agreement on trade in textile products between Hong Kong and the European Economic Community initialled on 2 October 1986 as amended and extended by the exchange of letters initialled on 3 November 1992 and to the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994.

The Special Representative of Hong Kong wishes to confirm to the Directorate-General that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the amended Agreement, the Government of Hong Kong is prepared to apply de facto from 1 January 1995 the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994. This is on the understanding that either Party may at any time terminate this de facto application of the amended Agreement provided that one hundred and twenty days notice is given.

The Special Representative of Hong Kong to the European Communities avails himself of this opportunity to renew to the Directorate-General for External Economic Relations of the Commission of the European Communities the assurance of its highest consideration.

Letter from the Government of Hong Kong

Sir,

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

'Sir,

1. I have the honour to refer to the Agreement between the European Economic Community and Hong Kong on trade in textile products initialled on 2 October 1986, as last amended and extended by the exchange of letters initialled on 3 November 1992.

2. In order to take into account the likely accession of the Republic of Austria, the Republic of Finland, the Kingdom of Norway 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 Hong Kong on trade in textile products:

2.1. Should the Uruguay Round Agreement on Textiles and Clothing become applicable in our relationships, Appendix I sets out the notional quantitative restrictions for the enlarged Community to be considered, for the purposes of notifying to the Textiles Monitoring Body, as those maintained by the enlarged Community and in force before the day of entry into force of the Uruguay Round Agreement on Textiles and Clothing, within the meaning of Article 2 of the Uruguay Round Agreement on Textiles and Clothing.

Should the Uruguay Round Agreement on Textiles and Clothing not become applicable in our relationships, Annex II of the Agreement which sets out the quantitative restrictions for exports from Hong Kong to the European Union is replaced for the period 1 January to 31 December 1995 by Appendix II to this letter.

2.2. Article 12, paragraph 2, subparagraph 2, second indent of Protocol A, Title III, Section II 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

NO = Norway

PT = Portugal

SE = Sweden"

2.3. 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 the Appendices to this letter and the respective amendments mentioned under point 2.2 shall not enter into force.

2.4. Should inaccuracies appear in the trade figures used to establish the adjustments contained in Appendices I and II, technical revisions of these adjustments will be made following consultations provided that the request for consultations is made no 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 III).

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 Hong Kong

Appendix I

NOTIONAL COMMUNITY QUANTITATIVE LIMITS 1994 Direct quotas

>TABLE>

Appendix II

ANNEX II COMMUNITY QUANTITATIVE LIMITS 1995 Direct quotas

>TABLE>

Appendix III

Exchange of notes

Note 1

The Directorate-General for External Economic Relations of the Commission of the European Communities presents its compliments to the Special Representative of Hong Kong to the European Communities and has the honour to refer to the Agreement on trade in textile products between Hong Kong and the European Economic Community initialled on 2 October 1986 as amended and extended by the exchange of letters initialled on 3 November 1992 and to the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994.

The Directorate-General wishes to inform the Special Representative of Hong Kong that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the amended Agreement, the European Community is prepared to apply de facto from 1 January 1995 the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994. This is on the understanding that either Party may at any time terminate this de facto application of the amended Agreement provided that one hundred and twenty days notice is given.

The Directorate-General for External Economic Relations would be grateful if the Special Representative of Hong Kong would confirm his 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 Special Representative of Hong Kong to the European Communities the assurance of its highest consideration.

Note 2

The Special Representative of Hong Kong to the European Communities presents his compliments to the Directorate-General for External Economic Relations of the Commission of the European Communities and has the honour to refer to the Agreement on trade in textile products between Hong Kong and the European Economic Community initialled on 2 October 1986 as amended and extended by the exchange of letters initialled on 3 November 1992 and to the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994.

The Special Representative of Hong Kong wishes to confirm to the Directorate-General that whilst awaiting the completion of the necessary procedures for the conclusion and coming into force of the amended Agreement, the Government of Hong Kong is prepared to apply de facto from 1 January 1995 the modifications contained in the Agreement in the form of an exchange of letters initialled on 25 November 1994. This is on the understanding that either Party may at any time terminate this de facto application of the amended Agreement provided that one hundred and twenty days notice is given.

The Special Representative of Hong Kong to the European Communities avails himself of this opportunity to renew to the Directorate-General for External Economic Relations of the Commission of the European Communities the assurance of its highest consideration.

AGREED MINUTE

On carry over from acceding countries

1. During the consultations held between Hong Kong and the European Community concerning enlargement of the European Union, the two Parties agreed that provided that they are notified by 28 February 1995 at the latest, quantities within the quantitative limits existing in 1994 in any of the acceding countries that have remained unused in 1994 may be the object of an exceptional carry-over to the corresponding 1995 Community quantitative limits, following consultations in accordance with the procedure referred to in Article 14 (1) of the Agreement.

2. The quantities carried over in each category shall not exceed 7 % of the quantitative limit from which the carry-over is requested.

3. The transposition into EU categories shall be made according to the enlargement methodology already used by the European Community in the apportioning of the textile quotas of acceding countries to the appropriate EU quotas.

Brussels, 25 November 1994