COMVIISSION OF THE EUROPEAN COMMUNITIES 
C0M(94) 4 14 finaI 
URUGUAY ROUND 94/ 
94/ 
94/ 
94/ 
94/ 
94/ 
94/ 
94/ 0225(ACC) 
0226(ACC) 
0227(ACC) 
0228(CNS) 
0229(C0D) 
0230(ACC) 
023KACC) 
0232(ACC) 
94/ 0233(ACC) 
94/ 0234(CNS) 
IMPLEMENTING 
LEGISLATION 
(presented by the Coaalssion) 
1 
Parti 
Central Implementation Act 
EXPLANATORY MEMORANDUM 
I Political aspects 
1. Background 
The European Community is one of the participating parties in the negotiations making 
up the eighth round of multilateral trade negotiations held under the auspices of the 
General Agreement on Tariffs and Trade (GATT). The Uruguay Round negotiations, as 
they were known, were concluded by the Trade Negotiations Committee in Geneva on 
15 December 1993. The Final Act embodying the results of the Uruguay Round 
multilateral trade negotiations (hereinafter the Final Act) was formally signed on behalf 
of the Community by the President of the Council, Mr Pangalos, and Sir Leon Brittan, 
Member of the Commission, in Marrakesh on 15 April. 
The Commission has officially presented the Council with a proposal for a decision on 
the conclusion of the results of the Uruguay Round Trade Negotiations.1 The Council has 
yet to act on this point. 
Like its principal trading partners, the Community gave its official approval for the 
establishment of the World Trade Organization and the other results of the Uruguay 
Round to take effect at multilateral level at the earliest possible opportunity, i.e. 
1 January 1995. 
An implementation conference will be held in Geneva early in December to this end. 
The Commission is convinced that any further delay in fulfilling its international 
obligations would be severely prejudicial to the Community's international prestige and 
credibility. 
2. Grounds for the proposed approach 
The Commission considers it appropriate, as matters now stand, to implement forthwith 
all the additions and amendments to Community legislation required by the Final Act. 
Aside from the Community's formal adoption of the results of the Uruguay Round and, 
consequently, from its accession to the World Trade-Organization as a founder member, 
the prompt adoption of this decision by the Council would also allow the Community to 
honour its commitments to its international trading partners. 
Pending lodging of the Community's official instruments of acceptance with the World 
Trade Organization, the current state of affairs in GATT would thus continue. 
COM(94) 143 final, 15.4.1994. 
1/ 
Irrespective of the fulfilment of commitments made under its auspices, the General 
Agreement has not been submitted for ratification by the parties. 
II Legislative aspects 
Examination of the Final Act shows that several measures it contains are already 
adequately covered by existing Community legislation. 
However, other measures do require the Community either to adopt new legislative acts 
or to amend existing Community law. 
This memorandum ssets out the reasons for the entry into force of all the acts required to 
implement the results of the Uruguay Round and summarizes the main grounds justifying 
the acts listed in the annex to the proposed implementing decision. 
In addition, each of the acts listed in the annex is preceded by its own explanatory 
memorandum giving detailed observations on the act concerned. 
1. Simultaneous entry into force 
Mainly at the Community's insistence, the Punta Del Este Declaration, which launched 
the Uruguay Round trade negotiations, established the principle of globality as one of the 
"guiding principles of the negotiations". 
From the point of view of the Community's objectives it was thought appropriate that 
"the launching, the conduct and the implementation of the outcome of the negotiations 
shall be treated as parts of a single undertaking".2 
The Council was regularly informed of progress and consistently underlined the point that 
the result of the Uruguay Rpund should be a "comprehensive and balanced outcome". 
The Commission also believes that only a global assessment will allow the Uruguay 
Round's contribution to the Community to be fairly judged. 
Most of the Community's partners in the negotiations have adopted procedures aimed at 
guaranteeing the "globality" of the outcome. 
On the multilateral front, accession to the World Trade Organization is subject to 
acceptance in full of the Final Act (see Agreement establishing the WTO, Articles XI and 
XII). 
Consideration of these factors led the Commission to propose at the Council meeting of 
15 April 1994 that the implementing legislation be presented as a whole in the form of 
a single legislative act. 
However, in order to facilitate discussion in the various Council committees, the 
Commission decided on the approach outlined here in which the political unity of the 
GATT document, MIN. DEC of 20.9.1986, p. 2 and 3. 
^ 
outcome is embodied in legal form by the attached decision on simultaneous entry into 
force. 
This decision lays down that all the acts required for the implementation of the results of 
the Uruguay Round, which are listed in full in its annex, will come into force legally in 
the Community simultaneously on 1 January 1995. The entry into force of each act is 
therefore subject to the adoption of this decision simultaneously implementing all the 
other acts. 
2. Commitments on customs duties for products not covered by the agriculture 
offer 
The negotiations on customs duties in the Uruguay Round resulted in the deposit by the 
Community of a new schedule of tariff concessions. 
The commitments entered into represent in total an average 30% reduction in the rate of 
customs duties applicable to imports from other GATT contracting parties. 
The participating parties in the Uruguay Round agreed to implement the first stage of 
reductions with effect from 1 January 1995. 
Pursuant to Council Regulation (EEC) No 2658/87 of 25 July 1987 the tariff to be 
applied as from 1 January of the following year must be published by 31 October at the 
latest. It seems unlikely that procedural delays would allow adoption of the tariff resulting 
from the Uruguay Round by that date, but publication of the pre-Uruguay Round tariff 
on the prescribed date would probably cause some confusion amongst businesses and lead 
to doubts inside and outside Europe as to the Community's determination to honour its 
commitments under the Uruguay Round. 
To avoid giving the wrong impression and damaging the Community's prestige 
internationally, the Commission considers it appropriate to waive the obligation to publish 
and, instead, to publish the tariff fixed in the Uruguay Round by way of information in 
the C series of the Official Journal on the prescribed date. 
The decision on tariffs is a key element and integral part of the overall outcome of the 
Uruguay Round. It is important, therefore, that it should be given due consideration 
along with the other results. Likewise, the tariff concessions granted by the Community 
in the Uruguay Round should take effect on the same date as the other commitments 
entered into during the negotiations. 
3. Non-tariff commitments 
The results of the Uruguay Round multilateral trade negotiations also include important 
non-tariff provisions. 
(a) Customs valuation 
Leaving aside a small number of essentially technical amendments, the Agreement on 
Implementation of Article VII of the General Agreement (Rules on Customs Valuation) 
was further clarified in two Decisions on customs valuation formally adopted at the 
c 
ministerial meeting in Marrakesh on 15 April 1994 and incorporated into the Final Act 
embodying the results of the Uruguay Round. 
The Decision on Texts Relating to Minimum Values and Imports by Sole Agents, Sole 
Distributors and Sole Concessionnaires is mainly addressed to developing countries and 
requires no action on the Community's part. 
The Decision Regarding Cases where Customs Administrations Have Reason to Doubt the 
Truth or Accuracy of the Declared Value, on the other hand, provides added protection 
for importers by stipulating that customs administrations must give reasons in writing for 
doubting the declared value, and giving importers a right of reply. 
These safeguards do not exist in Community law as it stands. As a result, Commission 
Regulation No 2454/93 of 2 July 1993, laying down provisions for the implementation 
of the Community Customs Code, needs to be amended. 
Since this is, however, a matter for the Commission, no amendments need be tabled for 
adoption by the Council, so none are included in the Annexes to the Decision. 
(b) Preshipment Inspection 
A number of developing countries lacking adequate customs facilities have given 
private-sector companies the task of verifying the price, quality and quantity of goods sent 
to them. This practice, with private firms exercising public authority, is known as 
preshipment inspection'. 
Preshipment inspection was included in discussions on non-tariff matters at the 
Community's suggestion. 
The Agreement incorporated into the Final Act applies basic GATT tenets such as non­
discrimination and transparency to the practices of preshipment inspection companies. It 
spells out in detail a set of obligations governing all aspects of preshipment inspection, 
paying special attention to price verification. It also introduces a two-tier dispute 
settlement system for private parties and Governments who are signatories to the GATT. 
Disputes between the inspection bodies and exporters will be settled by binding 
arbitration. Governments, however, will be fully liable, under the GATT dispute 
settlement procedure, for seeing that the Agreement on Preshipment Inspection is 
complied with. 
Community law has no rules on preshipment inspection, although it does exist in some 
of the Member States' national legislation. 
In view of the nature of the commitments made under the Agreement on Preshipment 
Inspection in the Uruguay Round, the various national authorities should implement the 
provisions, with a Council Directive to guide them. 
(c) Rules of Origin 
The Community entered negotiations with no specific demands of its own. It did, 
however, successfully push for the principle of a single set of rules of origin at 
international level, along with the notion that the last substantial transformation should 
determine origin. The criteria listed in Annex II of the Agreement on Rules of Origin 
correspond to current Community practice and do not affect the Community's preferential 
rules of origin. 
Part IV of the Agreement on Rules of Origin sets out a work programme for 
harmonization entailing further negotiations under the GATT. Work will be started as 
soon as the World Trade Organization is set up and is planned to last three years at this 
stage. 
The major changes to Community legislation will therefore not have to be introduced 
until 1998 at the earliest. In the meantime, there are the procedural changes relating to 
information on origin, which come under implementing arrangements for the Community 
Customs Code. 
The implementing regulation is Commission legislation and is being amended in line with 
the results of the Uruguay Round. It could be brought into force whenever appropriate, 
and does not need to be included among the proposals presented for adoption by the 
Council. 
(d) Import licences 
The Agreement on Import Licensing Procedures reached in the Tokyo Round has been 
revised, though the changes are mainly technical. 
On the substantive side, the nature of trade-restricting effects is now spelled out. The 
transparency clauses and the non-automatic licensing procedures have also been markedly 
improved. 
Upon examination, however, these changes do not appear to entail any amendments to 
Community legislation as it currently stands. 
4. Textiles and clothing 
The negotiations on bringing textiles and clothing under the GATT, subject to 
strengthened rules and disciplines, was one of the major issues of the Uruguay Round. 
The Agreement finally reached and incorporated into the Final Act meets the 
Community's objectives in this area via a twin process of liberalization and integration 
spread over three distinct phases. 
Some amendments to Council Regulation (EEC) No 3030/93 of 12 October 1993 on 
common rules for imports of certain textile products from third countries will be 
necessary to implement the Agreement. The details and the logic behind the amendments 
are discussed in the specific Explanatory Memorandum on textiles which is annexed to 
the attached Decision. 
5. Agriculture 
The hopes and fears of the Uruguay Round, from start to finish, were largely bound up 
with one issue - agriculture. 
The talks resulted in a string of provisions on agriculture which are largely, though not 
exclusively, contained in the Agreement on Agriculture set out in the Final Act. 
The Community's commitments in this sector will require a number of amendments to 
Community legislation and certain transitional measures. 
The changes, and the reasons for them, are detailed in a specific Explanatory 
Memorandum annexed to the Decision. 
6. Rules and disciplines 
(a) Technical barriers to trade 
The new'Agreement constitutes a major revision of the Code that emerged from the 
Tokyo Round. It generally has a clearer structure, stronger disciplines, and wider coverage 
in respect of those involved in standardization, drafting technical regulations, and 
evaluating products' conformity with the standards in question. 
More specifically, the new Agreement contains a Code of Practice setting out rules to be 
observed in establishing voluntary standards, which apply to both public and private 
bodies. It also takes an important step towards striking a better balance between rights and 
obligations by applying GATT disciplines to large local authorities. The introduction of 
the principle of proportionality is another major innovation, as is the inclusion of 
production processes and methods in the scope of the agreement. 
The changes made to the Agreement on Technical Barriers to Trade during the Uruguay 
Round negotiations broadly reflect the Community approach to standardization as it has 
emerged from work on the Single Market. No changes will therefore need to be made to 
the Community legislation currently in force to ensure compliance with the Agreement. 
(b) Trade-related investment measures 
The Uruguay Round Agreement on Trade-Related Investment Measures (TRIMs) clarifies 
the GATT provisions in this area, in that the contracting parties undertake not to apply 
any measures that are incompatible with Articles 111(4) and XI(1) of the GATT. There 
is an illustrative, i.e. non-exhaustive, list of definitions of the measures covered by the 
agreement. 
The section in Article III on breaches of national treatment obligations defines local 
content and limited manufacturing requirements, while the section in Article XI on 
breaches of the obligation to abolish quantitative restrictions lists domestic sales, product 
mandating and trade balancing requirements. 
Article 5 of the TRIMs Agreement allows the industrialized countries a transitional period 
of two years to dismantle measures covered by the Agreement. However, this period of 
grace will be granted only for measures of which GATT is notified within 90 days of the 
creation of the WTO. 
Community legislation is unaffected by the TRIMs Agreement, although the Member 
States are advised to take note of the terms of the agreement. 
S 
(c) Fair-trade provisions 
The negotiations on dumping and subsidies produced far-reaching changes to the Codes 
that emerged from the Tokyo Round. In order to comply with its commitments in this 
area, the Community will have to adopt new legislation and amend Regulation (EEC) No 
2423/88 and Regulations (EC) Nos 521/94 and 522/94. 
The reasons for the proposed changes are set out in detail in the sections on dumping and 
subsidies in the annex to this decision. 
The Uruguay Round negotiations also produced a new agreement specifically on 
safeguards. In order to comply with its commitments in this field, the Community will 
have to adopt a new regulation and repeal Council Regulation (EC) No 518/94 on 
common rules for imports. The grounds for this conclusion are set out in the annex. 
The new GATT codes and the changes designed to streamline and rationalize the 
Community's decision-making procedures should further strengthen our hand against 
illicit commercial practices and resulting damage to trade. The procedures laid down in 
Council Regulation (EEC) No 2641/84, as recently amended by Council Regulation (EC) 
No 522/94, accordingly need to be tightened up. 
7. Services 
The Uruguay Round produced two new developments in the field of international trade 
in services. 
The first is the General Agreement on Trade in Services (GATS), which establishes a 
binding framework regulating all measures covered by the agreement. Underpinning the 
rules in question are the GATT principles of non-discrimination and transparency. 
The GATS contains sectoral annexes on the movement of natural persons, air transport, 
telecommunications, financial services and maritime transport, which adapt the GATS 
provisions to the specific features of the sectors concerned. 
The schedule of initial liberalization commitments, which spells out the contracting 
parties' commitments as regards national treatment and/or market access in all services 
sectors, forms an integral part of the obligations imposed by the GATS. 
The Community approach in this area of negotiations was a function of progress in the 
creation of the Single Market, and consisted of translating its internal achievements in this 
field to the multilateral stage. The commitments into which it has entered do not exceed 
the obligations already imposed by the creation of the Single Market, and consequently 
do not entail any changes to current Community legislation. 
8. Intellectual property 
The Community's other main priority for the Uruguay Round was the creation of an 
efficient instrument to ensure that those intellectual property rights with implications for 
trade are genuinely enforced. 
A 
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) fully 
satisfies this requirement, in that it contains provisions on the protection of intellectual 
property rights that together make up a body of multilateral rules designed to promote 
international trade in products bearing such rights and to prevent the trade distortions and 
frictions that arise from the lack of adequate and effective protection. 
In addition to the general provisions and basic principles governing the protection of 
intellectual property rights, the TRIPs Agreement contains binding rules guaranteeing the 
existence, scope and protection of copyright and associated rights, trade marks, 
geographical indications, industrial models and designs, patents, and semi-conductor lay­
out designs, plus rules for the protection of business secrets and the control of anti­
competitive licensing practices. 
There are also detailed provisions on implementation of the TRIPs Agreement by national 
authorities. These provisions cover border procedures, which must meet certain specific 
requirements, the acquisition and retention of rights, and the procedures by which the 
holders of such rights can ensure that they are enforced. 
The obligations imposed by the TRIPs Agreement must be enforced by the contracting 
parties within one year of the creation of the WTO. 
In order to honour its commitments, the Community will have to amend its current 
legislation in this area along the lines detailed in the annex, though compliance with some 
of the obligations will be the responsibility of the Member States. 
9. Plurilateral agreements 
The Final Act of the Uruguay Round also contains the plurilateral agreements concluded 
under GATT auspices. 
(a) Sectoral agriculture agreements 
The International Dairy Agreement and the International Bovine Meat Agreement were 
not covered by the Uruguay Round negotiations. They appear in the Final Act unchanged 
from their Tokyo Round formats of 1979. 
The incorporation of plurilateral agreements into the WTO system, including its dispute 
settlement procedures, is binding for members^who are party to the agreements concerned. 
(b) Civil aircraft 
When the Uruguay Round proper was concluded, it was decided to prolong the 
negotiations on the revision of the Agreement on Trade in Civil Aircraft by another year. 
Pending the expiry of that deadline in May 1995, the 1979 Agreement produced by the 
Tokyo Round will remain in force. 
Needless to say, no changes in legislation are necessary at this stage. 
(c) Public procurement 
A new Agreement on Government Procurement was successfully concluded. 
8 
A-l 
The main outcome of the negotiations was to extend the scope of the Agreement to 
embrace procurement of supplies, works and services by national and local government 
agencies, and by public undertakings operating in the utility sectors (ports, airports, water, 
electricity and urban transport). 
Here too, the Community approach was conditioned by the progress achieved in the 
creation of the Single Market. Consequently, the revision of the Agreement on Public 
Procurement does not entail any major changes to current Community legislation. 
However, the Community is engaged in a series of bilateral negotiations on entities to be 
subject to the disciplines. The results of these negotiations will be submitted to the 
Council for adoption on a case-by-case basis, as the talks are concluded. 
It is possible that some of these bilateral agreements will entail making some minor 
changes to the legislation. Given that parties to the new Agreement on Public 
Procurement will not be required to enforce its provisions until 1 January 1996, and that 
the bilateral agreements will enter into force on the same date or even later, the 
Commission reserves the right if necessary to return to the implementation of the public 
procurement aspects of the Uruguay Round at a later date. 
10. Other agreements 
Negotiations for the Multilateral Agreement for Steel are still continuing so no text is 
included in the Final Act and no amendments to the legislation are therefore necessary 
for the time being. 
in. Procedural aspects 
The Commission proposal to the Council for a Decision concluding the Uruguay Round 
agreements recommends referral to Parliament under the assent procedure, since the Final 
Act, by virtue of the Agreement establishing the WTO, provides for a "specific 
institutional framework" within the meaning of the second subparagraph of Article 228(3) 
of the Union Treaty. 
In any case, the Uruguay Round agreements undeniably constitute international 
agreements of significant importance for the Community within the terms of the Stuttgart 
Solemn Declaration. 
In the interests of political and legislative consistency, therefore, it would also be sensible 
to submit to Parliament for its opinion the acts implementing the agreements. 
Since those acts are based on Article 113, however, that move is optional. 
When the package of legislation is,sent to Parliament the attention of the House should 
be drawn to the importance of enabling the Community to honour its international 
commitments as from 1 January next year. 
43/ 
COUNCIL DÉCISION flfloe/Arn 
f 10CM 94/ 0225CACC) 
of... 1994 
bringing into force simultaneously the acts implementing the results of the Uruguay 
Round of multilateral trade negotiations 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, and in particular 
Article 113 thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the several acts giving effect to the results of the Uruguay Round should come 
into force at the same time; 
Whereas the said results should enter into force in the Community on the same day that 
the Agreement establishing the World Trade Organization and its annexes enters into 
force at multilateral level; 
Whereas it was decided at the conference on implementation in Geneva in [December 
1994] that the said results should take effect on [1 January 1995], 
HAS DECIDED AS FOLLOWS: 
Article 1 
The acts giving effect to the results of the Uruguay Round multilateral trade negotiations 
listed in the annex to this Decision shall enter into force on [1 January 1995], except for 
acts relating to agreements which specifically provide for a later date. 
Article 2 
This Decision shall be published in the Official Journal of the European Communities. 
It shall take effect on the date of its publication. 
Done at Brussels, For the Council 
The President 
10 
A3 
ANNEX 
Council Decision amending the Combined Nomenclature and the Common 
Customs Tariff in the light of the results of the Uruguay Round. 
Council Directive on Pre-Shipment Inspections for Exports from the 
Community. 
Council Regulation amending Council Regulation No 3030/93 on common rules 
for imports of certain textile products from third countries. 
Council Regulation on the adjustments and transitional arrangements 
required in the agricultural sector in order to implement the agreements 
concluded during the Uruguay Round of Multilateral Trade Negotiations. 
Parliament and Council Regulation amending Council Regulation (EEC) No 
1576/89 laying down general rules on the definition, description and 
presentation of spirit drinks and Council Regulation (EEC) No 1601/91 
laying down general rules on the definition, description and presentation 
of aromatized wines, aromatized wine-based drinks and aromatized wine-
product cocktails following the Uruguay Round of the multilateral trade 
negotiations. 
Council Regulation on protection against dumped imports from countries 
not members of the European Community. 
Council Regulation on protection against subsidized imports from 
countries not members of the European Community. 
Council Regulation on common rules for imports, repealing Regulation (EC) 
No 518/94. 
Council Regulation on the strengthening of the common commercial policy, 
in particular with regard to protection against illicit commercial 
practices and adverse trade effects suffered by Community enterprises, 
and to the exercise of the Community's rights under international trade 
rules 
Council Regulation concerning certain measures to be taken to implement 
the Agreement on Trade-Related Aspects of Intellectual Property Rights in 
relation to certain modifications of Council Regulation (EC) No 40/94 on 
the Community trade mark. 
Council Decision concerning certain measures on the extension of the 
legal protection of topographies of semiconductor products to persons 
from a country of the World Trade Organisation. 
y'k 
Part 2 
Customs Tariff 
„1f 
Part3 
Preshipment Inspection 
^ 
COUNCIL DIRECTIVE 94/ 0226(ACC) 
on pre-shipment inspections for exports from the Community 
The Council of the European Union 
Having regard to the Treaty establishing the European Community, and in particular 
Article 113 thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament; 
Whereas a number of developing countries have recourse to so-called pre-shipment 
inspection programmes in order to ensure a proper distribution of limited foreign currency. 
resources to importers and in order to combat such practices as over-invoicing and fraud; 
whereas these developing countries have charged private companies with this task, which 
includes a check on quality, as well as price of the goods intended for export to the 
territory of these countries; 
Whereas the Community recognises the right of the developing countries to have recourse 
to pre-shipment inspection; whereas, however, pre-shipment inspections can give rise to 
abusive interferences in the price freely agreed between parties to a contract and to other 
practices which form unnecessary obstacles to trade; 
Whereas the Uruguay Round final act, signed on 15 April 1994 in Marrakech (Morocco), 
establishes an agreement on pre-shipment inspection between members of the World 
Trade Organisation (WTO); whereas this agreement needs to be put into effect for the 
Community; 
Whereas, in view of the maintenance of a common commercial policy of the Community it 
is necessary that the Member States regulate the activities of pre-shipment inspection 
entities along uniform lines; 
Whereas, to this end the Member States need to provide for a notification of pre-shipment 
inspection activities 
Whereas there is good reason to simplify procedures as much as possible, in particular 
with respect to the review of prices; whereas exemptions, however, are not foreseen by 
the agreement on pre-shipment inspection of the WTO and such exemptions can thus only 
be applied with the agreement of the by pre-shipment inspection entities; 
Whereas the Member State should institute a quick and effective procedure for the 
settlement of disputes between exporters and pre-shipment inspection entities; whereas 
such a procedure is foreseen by the agreement on pre-shipment inspection of the WTO; 
2 
Whereas the non-compliance with conditions or non-observance with procedures by pre­
shipment inspection entities should be settled with the third countries making use of such 
entities; 
Whereas Article 3 paragraph 3 of the agreement on pre-shipment inspection of the WTO 
provides for technical assistance to third countries; 
HAS ADOPTED THIS DIRECTIVE: 
Article 1 
This directive applies to activities, carried out on the customs territory of the European 
Community, by pre-shipment inspection entity which, for the account of governments or 
public entities of third countries, carry out controls on the quality, quantity or price of 
goods destined for exports to the territory of these third countries (pre-shipment 
inspection programmes). 
Article 2 
1. Member States shall make the activities of pre-shipment inspection entities as defined 
in Article 1 subject to a procedure for prior notification under the conditions set out in 
this directive. Modifications in the way pre-shipment inspection entities carry out these 
activities shall also be notified prior to their implementation 
2. This procedure shall be applied in a non-discriminatory manner 
Article 3 
The notification of activities mentioned in Article 2 shall cover the following activities: 
a. physical inspection of the merchandise before it is exported in order to verify the 
conformity of the dispatch (quality, quantity) with the specifications of the contract 
and the respect of rules and standards foreseen by the importing country or 
recognised at the international level; 
b. verification of the price, and where applicable, of currency exchange rate, on the 
basis of the contract between the exporter and the importer, the pro forma invoice 
and, where applicable, the application for import authorisation. A\ 
Ai 
3 
Article 4 
With a view to facilitating the implementation of the agreement on pre-shipment 
inspection of the WTO, Member States shall verify whether the notified activities meet at 
least the following conditions: 
a. when they notify their activities, the pre-shipment entities shall communicate to the 
authorities of the Member State(s) the dispositions, with the exception of the 
remuneration, of the contract agreed with the governments or public entities of third 
countries for the account of which the pre-shipment inspection programmes have 
been put in place. They shall subsequently communicate all modifications regarding 
the conditions for control to these same authorities. The competent authorities of the 
Member States shall verify that the dispositions of the contract are not contrary to 
the conditions of this directive. 
b. Prior to any control, the pre-shipment inspection entity informs the exporter of the 
modalities of the inspection and the criteria that will be applied. 
The pre-shipment inspection entity shall carry out the appropriate controls in a time 
span that avoids unreasonable delays. They shall also, following receipt of the final 
documents and completion of the inspection, within five working days, either issue a 
Clean Report of Findings or provide a detailed written explanation specifying the 
reasons for non-issuance. In the latter case exporters shall be given the opportunity 
to present their views in writing and, if exporters so request, arrange for re-
inspection at the earliest mutually convenient date. 
Pre-shipment inspection entities shall also undertake, whenever so requested by the 
exporter, prior to the date of physical inspection, a preliminary verification of price 
and, where applicable, of currency exchange rate, on the basis of the contract 
between exporter and importer, the pro forma invoice and, where applicable, the 
application for import authorisation. They shall, after a preliminary verification has 
taken place, immediately inform exporters in writing either of their acceptance or of 
their detailed reasons for non-acceptance of the price and/or currency exchange rate. 
In order to avoid delays in payment, pre-shipment inspection entities shall send to 
exporters or to designated representatives of the exporters a Clean Report of 
Findings as expeditiously as possible. They shall.also, in the event of a clerical error 
in the Clean Report of Findings, correct the error and forward the corrected 
information to the appropriate parties as expeditiously as possible. 
c. The pre-shipment inspections shall be carried out in a non-discriminatory manner, 
and the procedures and criteria employed in the conduct of these activities shall be 
objective and applied on an equal basis to all exporters affected by such activities. 
d. Pre-shipment inspection entities shall not request exporters to provide information 
regarding manufacturing data related to patented, licensed or undisclosed processes, 
or to processes for which a patent is pending; unpublished technical data other than 
data necessary to demonstrate compliance with technical regulations or standards; 
internal pricing, including manufacturing costs; profit levels; the terms of contracts 
between exporters and their suppliers unless it is not otherwise possible for the 
entity to conduct the inspection in question. (In such cases, the entity shall only 
request the information necessary for this purpose). 
^\5 
In general, pre-shipment inspection entities shall treat all information provided by 
exporters as business confidential, to the extent that such information is not already 
published, generally available to third parties, or otherwise in the public domain. 
Such business confidential information shall be shared with the governments 
contracting or mandating the entity only to the extent that such information is 
customarily required for letters of credit or other forms or payment or for customs, 
import licensing or exchange control purposes. 
e. Pre-shipment inspection entities shall establish procedures to receive, consider and 
render decisions concerning grievances raised by the exporters. These procedures 
shall be developed and maintained in accordance with the following guidelines: 
i. pre-shipment inspection entities shall designate one or more officials who shall 
be available during normal business hours in each city or port in which they 
maintain a pre-shipment inspection an administrative office to receive, consider 
and render decisions on exporters' appeals or grievances; 
ii. exporters shall provide in writing to the designated official(s) the facts 
concerning the specific transaction in question, the nature of the grievance and a 
suggested solution; 
iii. the designated official(s) shall afford sympathetic consideration to exporters' 
grievances and shall render a decision as soon as possible after receipt of the 
documentation referred to in sub-paragraph (ii). 
OLD 
5 
Article 5 
In order to prevent over- and under-invoicing and fraud in the importing third country, 
Member States shall verify that pre-shipment inspection entities conduct price verification1 
according to the following conditions. 
a. pre-shipment inspection entities shall only reject a contract price agreed between an 
exporter and an importer if they can demonstrate that their findings of an 
unsatisfactory price are based on a; verification process which is in conformity with 
the criteria set out in sub-paragraphs (b) through (e), 
b. the pre-shipment inspection entity shall base its price comparison for the verification 
of the export price on the price(s) of identical or similar goods offered for export 
from the same country of exportation at or about the same time, under competitive 
and comparable conditions of ^sale, in conformity with customary commercial 
practices and net of any applicable standard discounts. Such comparison shall be 
based on the following: 
i. only prices providing a valid basis of comparison shall be used, taking into 
account the relevant economic factors pertaining to the country of importation 
and a country or countries used for price comparison; 
ii. the pre-shipment inspection entity shall not rely upon the price of goods offered 
for export to different countries of importation to arbitrarily impose the lowest 
price upon the shipment; 
iii. the pre-shipment inspection entity shall take into account the specific elements 
listed in sub-paragraph (c); 
iv. at any stage in the process described above, the pre-shipment inspection entity 
shall provide the exporter with an opportunity to explain the price; 
c. when conducting price verification, pre-shipment inspection entities shall make 
appropriate allowances for the terms of the sales contract and generally applicable 
adjusting factors pertaining to the transaction; these factors shall include but not be 
limited to the commercial level and quantity of the sale, delivery periods and 
conditions, price escalation clauses, quality specifications, special design features, 
special shipping or packing specifications, order size, spot sales, seasonal influences, 
licence or other intellectual property fees, and services rendered as part of the 
contract if these are not customarily invoiced separately; they shall also include 
certain elements relating to the exporter's price, such as the contractual relationship 
between the exporter and importer; 
1 It should be remembered that the obligations of user Members with respect to the services of pre­
shipment entities in connection with customs valuation shall be the obligation which they have accepted 
in GATT 1994 and the other Multilateral Trade Agreements included in Annex 1A of the WTO 
Agreement (footnote 4 of the agreement on pre-shipment inspection of the WTO). 
Ad 
6 
d. the verification of transportation charges shall relate only to the agreed price of the 
mode of transport in the country of exportation as indicated in the sales contract; 
e. the following shall not be used for price verification purposes: 
i. the selling price in the country of importation of goods produced in such 
country; 
ii. the price off goods for export from a country other than the country of 
exportation; 
iii. the cost of production; 
iv. arbitrary or fictitious prices or values. 
Article 6 
In order to avoid unnecessary delays for exporters, Member States shall incite pre­
shipment inspection entities to use simplified verification procedures, where appropriate, 
in particular to exclude the review of prices in certain cases. In establishing these 
simplified procedures, however, account shall be taken of the obligation by Member States 
and pre-shipment inspection entities to carry out the activity in a non-discriminatory 
manner. 
Article 7 
If the pre-shipment inspection entity does not observe the conditions set out in Articles 4 
and 5 of this Directive, or if the entity does not comply with the procedures set out in 
Article 9, the authorities of a Member State shall notify the Commission and the other 
Member States of such non-observance or non-compliance and may have recourse to the 
procedure foreseen by Article 4 of Council Regulation2641/84 (EC)2. 
Article 8 
Member States shall provide third countries, if requested, technical assistance directed 
towards the achievement of the objectives of the agreement on pre-shipment inspection in 
the WTO mutually agreed terms, or how to do without them. 
2 OJL252of20.9.1984p. 1 
a^/ 
Article 9 
Member States shall encourage pre-shipment inspection entities and exporters mutually to 
resolve their disputes. However, two working days after submission of the grievance in 
accordance with the provisions of paragraph e of Article 4, either party may refer the 
dispute to independent review entity as foreseen by Article 4 of the agreement on pre­
shipment inspection of the World Trade Organisation (WTO). The procedure shall be as 
follows: 
a. an exporter or pre-shipment inspection entity wishing to raise a dispute shall contact 
the independent entity referred to above and request the formation of a panel. The 
independent entity shall be responsible for establishing a panel. This panel shall 
consist of three members. The members of the panel shall be chosen so as to avoid 
unnecessary costs and delays. The first member shall be chosen from section (i) of 
the hst foreseen in the WTO agreement on pre-shipment inspection by the pre­
shipment inspection entity concerned, provided that this member is not affiliated to 
that entity. The second member shall be chosen from section (ii) of the list foreseen 
in the WTO agreement on pre-shipment inspection by the exporter concerned, 
provided that this member is not affiliated to that exporter. The third member shall 
be chosen from section (iii) of the list foreseen in the WTO agreement on pre­
shipment inspection by the independent entity referred to above. No objections shall 
be made to any independent trade expert drawn from section (iii) of the list foreseen 
in the WTO agreement on pre-shipment inspection; 
b. the independent trade expert drawn from section (iii) of the list foreseen in the WTO 
agreement on pre-shipment inspection shall serve as the chairman of the panel. The 
independent trade expert shall take the necessary decisions to ensure an expeditious 
settlement of the dispute by the panel, for instance, whether the facts of the case 
require the panellists to meet and, if so, where such a meeting shall take place, 
taking into account the site of the inspection in question; 
c. if the parties of the dispute so agree, one independent trade expert could be selected 
from section (iii) of the list foreseen in the WTO agreement on pre-shipment 
inspection by the independent entity referred to in sub-paragraph (a) to review the 
dispute in question. This expert shall take the necessary decisions to ensure an 
expeditious settlement of the dispute, for instance taking into account the site of the 
inspection in question; 
d. the object of the review shall be to estabUsh whether, in the course of the inspection 
in dispute, the parties to the dispute have complied with the provisions of this 
directive. The procedures shall be expeditious and provide the opportunity for both 
parties to present their views in person or in writing; 
^ 
8 
e. decisions by a three-member panel shall be taken by majority vote. The decision on 
the dispute shall be rendered within eight working days of the request for 
independent review and be communicated to the parties of the dispute. This time-
limit could be extended upon agreement by the parties to the dispute. The panel or 
independent trade expert shall apportion the costs, based on the merits of the case; 
f. the decision of the panel shall be binding upon the pre-shipment inspection entity and 
the exporter which are parties to the dispute. 
Article 10 
This directive shall enter into force on the date determined bv the decision on the entry 
into force of the acts implementing the Results of the Uruguay Round 
They will inform the Commission of these measures or any modifications thereof. 
Separately they will submit copies of these measures to the Secretariat of the WTO. 
The measures or modifications thereof shall not be enforced before they have been 
published. 
Article 11 
This directive is addressed to Member States. 
'ÀLf 
Part 4 
Textiles & clothing 
d£ 
Proposal for a Council Regulation amending 
COUNCIL REGULATION (EEC) No 3030/93 of 12 October 1993 
on common rules for imports of certain textile products from third countries 
2(o 
Explanatory Memorandum 
1. The present proposal amending Regulation 3030/93 on common rules for imports 
of textiles is designed to ensure effective implementation of the Agreement on Textiles 
and Clothing of the World Trade Organization. 
2. The WTO Agreement on Textiles and Clothing necessitates three types of 
changes to Regulation 3030/93: 
(i) the safeguard provisions (Article 10) have to be brought into line with 
those of the new WTO Agreement on Textiles and Clothing (Article 6); 
(ii) the Community quantitative limits contained in Annex V affecting imports 
from members of the WTO will have to be adjusted at the beginning of each of the 3 
phases of the WTO Agreement on Textiles and Clothing to reflect the higher annual 
quota growth rates foreseen; similarly at such time as the European Union integrates 
products subject to quantitative limits such products should be deleted from Annex V; 
(iii) as and when certain of the third countries listed in Annex VIII (flexibility 
provisions) become members of the WTO, the respective "cap" on cumulative use of 
flexibility provisions indicated in column 8 of the table will have to be deleted since 
Article 2 paragraph 16 of the WTO Agreement on Textiles and Clothing stipulates that 
there shall be no limit to the "combined use of swing, carry over and carry forward". 
Since it is not clear at this stage whether and when all the third countries listed in the 
Annexes will become members of the WTO and thereby benefit from the Agreement on 
Textiles and Clothing, the Commission will adopt the necessary technical amendments to 
the Annexes to Regulation 3030/93 referred to in points (ii) and (iii) above via the 
Textiles Committee procedure laid down in Article 17 of the Regulation. 
To this end and for reasons of clarity it is proposed to delete the reference to the quota 
years 1993-1995 in Article 2 paragraph 1 of the Regulation since for WTO Members the 
quota increases will be automatic for the next 10 years. 
3. With regard to the safeguard clause, it is proposed to maintain the existing 
language on the basket exit mechanism contained in the present paragraphs 1 and 2 of 
Article 10 of the Regulation and to add clauses corresponding to the new provisions of 
the WTO Agreement on Textiles and Clothing. The reason for this is that of the countries 
listed in Annex IX which are currently subject to the basket exit mechanism a number of 
important suppliers (eg China, Taïwan, Vietnam, ex USSR) will probably not be 
members of the WTO upon the date of its entry into force but join in the near future. 
Therefore, it will be necessary to maintain the current safeguard mechanism to cover the 
interim period. The Commission proposes two parallel safeguard provisions in the 
Regulation and as and when each of the third countries listed in Annex IX benefits from 
the WTO Agreement on Textiles and Clothing, that country will be deleted from Annex 
IX via the Textiles Committee procedure (Article 17 of the Regulation). 
A> 
Proposal for a Council Regulation amending *94/ 0227 ( Acc} 
COUNCIL REGULATION (EEC) No 3030/93 of 12 October 1993 
on common rules for imports of certain textile products from third countries 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community and in particular 
Article 113 thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the Community has signed the Final act of the Uruguay Round of GATT 
negotiations setting up a World Trade Organization, (hereinafter referred to as the WTO); 
Whereas it is necessary to amend the safeguard provisions laid down in Regulation 
(EEC) No 3030/93 of 12 October 19931 on common rules for imports of certain textile 
products from third countries, as last amended by Commission Regulation (EC) No. 
195/94 of 12 January 19942, in order to bring them into line with the new safeguard 
provisions contained in the WTO Agreement on Textiles and Clothing with regard to 
imports from WTO Members; 
Whereas the WTO Agreement on Textiles and Clothing also stipulates the annual growth 
rates which will be applied automatically to remaining Community quantitative limits on 
imports from WTO Members for a period of 10 years following entry into force of the 
WTO; whereas it is therefore appropriate that the Community quantitative limits foreseen 
in Annex V of Regulation (EEC) No 3030/93 on imports from WTO Members should be 
amended at each stage of the WTO Agreement on Textiles and Clothing via the 
procedure foreseen in Article 17 of the Regulation and paragraph i of Article 2 of the 
Regulation should be amended to that effect. 
1 OJ No L 275, 8.11.1993, p.l 
2 OJ No L 29, 2.2.1994, p. 1 
5Ï 
HAS ADOPTED THIS REGULATION 
Article 1 
Article 10 of Council Regulation (EEC) No 3030/93 is replaced by the following: 
"Article 10 
Safeguard measures 
1. Should imports into the Community of products falling within any given 
category, not subject to the quantitative limits set out in Annex V and originating in one 
of the countries listed in Annex IX exceed, in relation to the preceding calendar year's 
total imports into the Community of products in the same category, the percentages 
indicated in the Table appearing in Annex IX, such imports may be made subject to 
quantitative limits under the conditions laid down in this Article. 
2. Paragraph 1 shall not apply where the percentages specified therein have been 
reached as a result of a fall in total imports into the Community, and not as a result of an 
increase in exports of products originating in the supplier country concerned. 
3. Where the Commission, upon its own initiative or at the request of a Member 
State, considers that the conditions set out in paragraph 1 are fulfilled and that a given 
category of products should be made subject to a quantitative limit: 
(a) it shall open consultations with the supplier country concerned in accordance with 
the procedure specified in Article 16 with a view to reaching an arrangement or joint 
conclusions on a suitable level of restriction for the category or products in question; 
(b) pending a mutually satisfactory solution, the Commission shall, as a general rule, 
request the supplier country concerned to limit exports of the products in the category 
concerned to the Community, for a provisional period of three months from the date on 
which the request for consultations is made. Such provisional limit shall be established at 
25% of the level of imports during the previous calender year, or 25% of the level 
resulting from the application of the formula set out in paragraph 1, whichever is the 
higher; 
(c) it may, pending the outcome of the requested consultations, apply to the imports 
of the category of products in question quantitative limits identical to those requested of 
the supplier country pursuant to point (b). These measures shall be without prejudice to 
the definitive arrangements to be made by the Community, taking into account the results 
of the consultations. 
4. (a) Should imports into the Community of textile products not subject to the 
quantitative limits set out in Annex V and originating in Bulgaria, the Czech Republic, 
Hungary, Poland, Romania or the Slovak Republic take place in such increased 
quantities, or under such conditions, so as to cause serious damage or actual threat 
thereof, to the Community's production of like or directly competitive products, such 
imports may be made subject to quantitative limits under the conditions laid down in the 
Additional Protocols with these countries. 
25 
(b) The provisions of paragraph 3, shall also apply in such cases except that 
the provisional limit referrred to in paragraph 3 (b) shall be established at 25%, at least, 
of the level of imports during the twelve-month period terminating two months, or where 
data is not available three months, preceding the month in which the request for 
consultations is made. 
5. (a) With regard to products not subject to the quantitative limits set out in 
Annex V and originating in countries which are Members of the World Trade 
Organization, safeguard action may be taken where it is demonstrated that a particular 
product is being imported into the Comunity in such increased quantities as to cause 
serious damage, or actual threat thereof, to the domestic industry producing like and/or 
directly competitive products. Serious damage or actual threat thereof must demonstrably 
be caused by such increased quantities in total imports of that product and not by such 
other factors as technological changes or changes in consumer preference. 
(b) In making a determination of serious damage, or actual threat thereof, as 
referrred to in paragraph (a) the effect of those imports on the state of the particular 
industry shall be examined, as reflected in changes in such relevant economic variables 
as output, productivity, utilization of capacity, inventories, market share, exports, wages, 
employment, domestic prices, profits and investment. 
(c) The third country or countries, Member(s) of the World Trade 
Organization to whom serious damage, or actual threat thereof, as referred to in 
paragraph (a) is attributed, shall be determined on the basis of a sharp and substantial 
increase in imports, actual or imminent and on the level of imports as compared with 
imports from other sources, market share and import and domestic prices at a comparable 
stage of commercial transaction. 
6. Where the Commission, upon its own initiative or at the request of a Member 
State, considers that the conditions set out in paragraph 5 are fulfilled and that the 
products in question should be made subject to a quantitative limit: 
(a) it shall open consultations with the supplier country concerned in accordance with 
the procedure specified in Article 16 with a view to reaching an arrangement or joint 
conclusions on a suitable level of restriction for the products in question; 
(b) it may, pending the outcome of the consultations and in highly unusual and 
critical circumstances where delay would cause damage which could be difficult to 
repair, impose a provisional quantitative limit on the products in question. Such 
provisional limit shall not be lower than the actual level of imports from the supplier 
country during the twelve-month period terminating two months proceding the month in 
which the request for consultations was made. 
7. (a) Measures taken pursuant to paragraphs 3, 4 and 6 shall be the subject of a 
Commission communication published without delay in the Official Journal of the 
European Communities. 
I o 
(b) The Commission shall refer urgent cases to the Committee provided for in 
Article 17 either at its own initiative or within five working days of receipt of a request 
from a Member State or States setting out the reasons for the urgency and shall take a 
decision within five working days of the end of the Committee's deliberation. 
8. The consultations with the supplier country concerned which are provided for in 
paragraphs 3, 4 and 6 may lead to an arrangement between that country and the 
Community, on the introduction and the level of quantitative limits. Such arrangements 
shall stipulate that the quantitative limits agreed be administered in accordance with a 
double-checking system. 
9. Should the parties be unable to reach a satisfactory solution within 60 days 
following notification of the request for consultations, the Community shall have the 
right to introduce a definitive quantitative limit at an annual level not lower than: 
(a) in the case of supplier countries listed in Annex IX, the level resulting from the 
application of the formula set out in paragraph 1 or 106% of the level of imports reached 
during the calendar year preceding that in which imports exceeded the level resulting 
from the application of the formula set out in paragraph 1 and gave rise to the request for 
consultations, whichever is the higher. 
(b) in the case of Bulgaria, the Czech Republic, Hungary, Poland, Romania or the 
Slovak Republic, 110% of the imports for the twelve-month period tenninating two 
months, or where data is not available three months, preceding the month in which the 
request for consultations is made. 
(c) in the case of supplier countries, members of the WTO, the actual level of imports 
from the supplier country concerned during the twelve-month period terminating two 
months preceding the month in which the request for consultations was made. 
10. The annual level of the quantitative limits established in accordance with 
paragraphs 3 to 6 or 9 may not be less than the level of imports into the Community in 
1985 for Argentina, Brazil, Hong Kong, Pakistan, Peru, Sri Lanka and Uruguay, and in 
1986 for Bangladesh, India, Indonesia, Malaysia, Macao, Philippines, Singapore, South 
Korea and Thailand, of products of the same category and originating in the same 
supplier country. 
11. The quantitative limits established under this Article shall not apply to products 
which have already been dispatched to the Community provided that they were shipped 
from the supplier country in which they originate for export to the Community before the 
date of notification of the request for consultations. 
u 
12. Measures taken in acordance with the provisions of paragraph 5 may remain in 
place: 
(a) for up to three years without extension, or 
(b) until the product is integrated into GATT 1994, whichever comes first. 
13. The measures provided for in paragraphs 3, 4, 6 and 9 and the arrangements 
referred to in paragraph 9 shall be adopted and implemented in accordance with the 
procedure laid down in Article 17." 
Article 2 
Article 2 paragraph 1 of Council Regulation (EEC) No. 3030/94 is replaced by the 
following: 
"The importation in the Community of the textile products listed in Annex V originating 
in one of the supplier countries listed in that Annex shall be subject to the annual 
quantitative limits laid down in that Annex". 
Article 3 
This Regulation shall enter into force on date determined by the decision of entry into 
force of the acts implementing the results of the Uruguay Round. 
This Regulation shall be binding in its entirety and directly applicable in all Member 
States. 
Done at Brussels, For the Council 
l> 
Part5 
Agriculture 
V} 
EXPLANATORY MEMORANDUM 
I. INTRODUCTION 
Several of the agreements which the Community has negotiated under the 
Uruguay Round (hereinafter referred to as the "GATT Agreements")(*) 
involve adapting some of the legislation implementing the common 
agricultural policy. These are in particular: 
- the Agreement on Agriculture (hereinafter referred to as the 
"Agreement"), 
the Agreement on the Application of Sanitary and Phytosanitary 
Measures, 
the Agreement on Safeguards, and 
- the Agreement on Trade-Related Aspects of Intellectual Property Rights 
(hereinafter referred to as the "TRIPS Agreement"). 
As regards agriculture, these Agreements cover the following aspects: 
the internal support arrangements, 
the arrangements on trade with third countries, 
a system for the protection of designations of origin (part of the 
TRIPS Agreement), 
arrangements concerning veterinary and plant health measures affecting 
international trade. 
The attached proposals for Regulations(2) contain the provisions 
necessary for incorporating into Community law the rules referred to 
in the last three indents above. As regards the arrangements for 
internal support, the Commission considers that specific provisions 
should not be introduced into the market organizations. The relevant 
rules in the Agreement should be taken into account when prices are 
fixed and aid measures are adopted for future marketing years. 
In order to safeguard the possibility of the necessary measures being 
taken in trade relations with third countries vis-à-vis which the 
Commission has no obligations under the GATT Agreements, the "GATT" 
proposal provides a suitable legal basis. 
(1) See proposal for a Council Decision con the conclusion of the results 
of the Uruguay Round of the multilateral trade negotiations (1986-94), 
COM(94) 143 final of 15 May 1994. 
(2) there are two draft Regulations: one covering all the amendments based 
on Article 43 of the EC Treaty (referred to as the "GATT" proposal) 
and one based on Articles 43 and 100a of the Treaty. 
^ 
These proposals do not cover the following: 
- issues arising from the GATT Agreements and affecting the 
preferential agreements concluded with third countries (e.g. Lomé 
Convention) and the enlargement of the Community, which are still to 
be dealt with; 
- the agri-monetary arrangements for the new system; these will be 
dealt with in the report on the agri-monetary system which the 
Commission is to present to the Council before the end of 1994. 
II. TRADE ARRANGEMENTS 
A. General 
The GATT Agreements centre the trade arrangements on the following 
main points: 
- tarification, 
- access to the Community market, 
- safeguard provisions, 
- the export subsidy system. 
The "GATT" proposal is based on the following principles: 
- careful compliance with obligations under the GATT Agreements, 
- maximum flexibility for management, 
- full use of possibilities offered by the GATT Agreements, 
- as little change as possible to the organization of the markets in 
the various agricultural products. 
However, it has proved inevitable to make amendments to almost all the 
provisions in the basic Regulations relating to trade with third 
countries. The abolition of variable levies not only entails 
abolishing the rules for their calculation but also calls for the 
articles relating thereto to be adapted. This also holds true for 
export refunds, which can only be granted subject to the quantitative 
and financial limits laid down in the Agreement. 
Nevertheless, this proposal largely confines' itself to incorporating 
in the basic Regulations the main principles on the implementation of 
the GATT Agreements and entrusting the Commission with the task of 
implementing them in line with the needs of the various sectors. This 
approach, which is based in particular on the heed to preserve 
sufficient flexibility for day-to-day management, takes account in 
particular of the fact that most obligations to be met are defined 
precisely in the Agreements. 
ir 
When making these amendments, the Commission has also held to the 
principle recognized at the time of the consolidation of the 
Regulation on the market organization for cereals (Regulation (EEC) 
No 1766/92) under the reform of the CAP and applied on several 
occasions since then, to the effect that competence for legislation 
should be shared between the Council and the Commission so as to 
result in two levels only: on the one hand the provisions adopted by 
the Council in accordance with the procedure laid down in 
Article 43(2) of the EC Treaty and, on the other, the detailed rules 
of application adopted by the Commission in accordance with the 
Management Committee procedure. 
As regards the implementation of the GATT Agreements in legislation, 
the Commission has opted for an approach by product group which 
preserves the traditional structure of the market organizations, as 
set out in particular in the basic Regulations, and at the same time 
ensures the transparency of the solutions chosen. The "GATT" proposal 
accordingly consists in concise substantive provisions covering all 
product groups and comprising in particular a legal basis for the 
adoption of the necessary transitional rules, the annexes to which 
contain the adjustments to be made for the various sectors. It also 
provides for the repeal of the regulations laying down general rules. 
B. Import arrangements 
1. Import charges (tarification) 
The fundamental change introduced by the new import arrangements is 
the replacement of variable charges (levies, compensatory amounts, 
etc.) and other types of non-tariff import restrictions (quantitative 
restrictions, voluntary restraint agreements, etc.) by stable, 
degressive tariffs. The introduction of such tariffs will be effected, 
in legal terms, by means of a suitable amendment to the Common Customs 
Tariff, the relevant figures being set out in the final schedules 
presented by the Community to the Director-General of GATT and forming 
a legal part of the Agreement. In the basic Regulations, it will 
accordingly be sufficient to refer to the duties entered in the CCT. 
The replacement of variable charges by the CCT duties implies the 
repeal of all the rules which refer to their calculation, i.e. in 
particular all provisions on the fixing of threshold prices, reference 
prices, etc. and the rules laid down for the calculation of variable 
•charges applying to derived products. 
u 
Certain special points should be mentioned: 
(a) The "special safeguard provisions" 
These provisions allow a minimum level of protection to be 
maintained against the adverse effects on the market of the 
conversion of the former import restrictions into customs duties 
("tarification"). They therefore only apply to products 
specifically identified in the final schedules. They must not be 
confused with the safeguard provisions traditionally appearing in 
all the basic Regulations; in fact, they involve a system which is 
additional to the import duty and allow the latter to be increased 
if certain conditions specified in the Agreement are met. 
Accordingly, a specific article has been introduced, providing a 
suitable legal basis for making use, at the right time, of the 
possibilities afforded by this system. The extent to which the 
system will be used depends on the market conditions applying for 
the various products. 
(b) Standard safeguard provisions 
The standard safeguard provisions appearing hitherto in the basic 
Regulations are maintained. However, the Agreement on Safeguards 
contains reinforced all-sector arrangements specifying the 
conditions under which they may be applied. A reference to these 
rules has accordingly been included in the articles in question, 
which have also been adapted to take account of the division of 
competence mentioned in A. 
(c) Specific arrangements for raw sugar for refining and molasses 
Tarification as provided for in the Agreement could result in raw 
sugar for refining and molasses being subject to an import charge 
which could jeopardize supplies of such products to processing 
industries in the Community. Accordingly, a special mechanism has 
been introduced to permit the application of the duty entered in 
the CCT to be suspended where the price recorded on the world 
market exceeds a certain level. 
*> 
(d) Special arrangements on prices applying 
For certain products (e.g. some cereals and rice), the Agreement 
involves a level of protection, lower than that provided by the 
CCT, which is dependent on import prices. Similarly, for certain 
fruit and vegetables, must and grape juice, the import charge 
depends on the entry price. In this respect, certain special rules 
or necessary derogations from the CCT have been laid down, 
implementation and details being left to the detailed rules of 
application, which will have to deal in particular with the thorny 
problem of controls. The present system of minimum import prices 
remains in force for dried grapes and processed cherries until 
1 January 2000. 
(e) Management measures for beef and veal 
The Agreement's ban on quantitative import restrictions requires 
the repeal of Council Regulation (EEC) No 1157/92 of 28 April 
1992, which at present serves as a legal basis for the erga omnes 
limitation on imports of young bovine animals. As that measure is 
of special importance for maintaining balance on the market for 
beef and veal in the Community, the Commission will deal with the 
matter during the renegotiation of the Europe Agreements with 
certain East European countries. 
2. Access to the Community market 
In this context, the term "market access" covers all the conditions 
under which imports may take place at reduced or zero duty. A 
distinction should be made in principle between agreements concluded 
with certain third countries containing preferential conditions 
granted by the Community, current access within the meaning of the 
Agreement (which includes part of the abovementioned agreements) and 
minimum access. 
In view of the high number of quotas in question and in order to 
ensure their implementation as effectively as possible, a uniform 
approach has been adopted for all cases, whatever their history. For 
the sake of simplification and efficiency, this approach provides 
that, on the basis of the international agreements concluded by the 
Council or of autonomous acts of the latter and in accordance with the 
conditions stipulated therein, the opening and administration of 
•tariff quotas are to be carried out by the Commission in accordance 
with the Management Committee procedure. A similar approach was 
adopted for the administration of the quotas opened recently as a 
result of the Soya Panel (Regulation (EC) No 774/94). Naturally, this 
uniform procedural approach does not imply that the detailed rules 
will be the same for all product groups. 
M 
As regards the market organization for bananas, the "GATT" proposal 
involves taking over the framework agreement with certain countries in 
Latin America. In accordance with the general approach in Regulation 
(EEC) No 404/93, certain aspects of the allocation of tariff quotas 
are incorporated in the Regulation. 
C. Export arrangements 
1. General 
The export arrangements resulting from the Agreement provide for a 
reduction in forthcoming years in the subsidies which may be granted 
on agricultural products exported from the Community as such or after 
processing. The reduction is to be made in accordance with rules 
concerning the sums granted for all such exports and the quantities of 
products exported as such(3). The arrangements must be applied in 
such a way as to permit verification of compliance with those limits 
for a period of 12 months, to commence in principle on 1 July 1995 
and, in the case of other products (rice, wine, olive oil and sugar) 
at later dates. 
The Commission considers that compliance with limits on the value of 
refunds may be monitored: 
- when refunds are fixed, 
- on the basis of advance fixing authorized by the Commission or of 
tenders accepted in response to invitations to tender, 
- on the basis of information provided by the Member States on 
licences issued, refunds granted being compulsorily fixed in 
advance, and 
- on the basis of information provided to the EAGGF relating to 
payments made by national bodies. Using such information, it should 
be possible to charge each payment made to the EAGGF financial year 
during which export formalities were completed. 
As a result no other specific mechanisms need be introduced to ensure 
compliance with limits on value.. 
2. Compliance with limits on quantity 
As regards limits on quantity, the Agreement provides that compliance 
must be demonstrated in terms of the quantities qualifying for export 
•refunds for which export licences have been issued during the 
marketing year in question. 
(3) Limits on quantity do not apply to non-Annex II products. 
19 
(a) The aim of the "GATT" proposal is to ensure monitoring of the 
quantities exported using export licences. Accordingly, such 
licences will become compulsory where products covered by a refund 
application are exported. This does not rule out the possibility 
that, for certain product groups where such arrangements already 
exist, export licences may also be required for purposes of 
statistical monitoring of trade where export takes place without 
any refund being granted. It remains to be decided whether 
monitoring of the quantities exported will mean limiting the 
duration of validity of export licences to the curent marketing 
year or whether monitoring can be based on licences issued during 
the marketing year. The detailed rules for the application of the 
licence arrangements, and in particular the conditions 
specifically relating to the issuing, term of validity and 
transferability of licences, will be laid down, as at present, in 
accordance with the Management Committee procedure for the product 
group concerned. 
Clearly, compliance with limits on quantity under the Agreement 
calls for mechanisms to prevent any overrun. As the choice of 
measures to be taken depends on the specific situation and the 
requirements of the market in each product, the "GATT" proposal 
does not dictate the methods to be used for checking quantities 
available. 
(b) One possible option is to determine export refunds by invitation 
to tender. Here too, the "GATT" proposal does not dictate the 
procedures to be adopted; refunds could also be fixed periodically 
as they are now. 
(c) It is the Commission's intention to select the approach which 
involves the least red tape and is best adapted to the specific 
situation of the product group concerned. This is why the "GATT" 
proposal lays down flexible legal bases which allow the most 
suitable solution to be sought for each product group, in 
particular to make maximum use of the latitude offered by the GATT 
Agreements and, where appropriate, for the arrangements to be 
amended in the light of experience in applying them. This approach 
is, moreover, in line with the way the Commission has hitherto 
exercised the competence it has enjoyed under the arrangements in 
force to date. 
h 
(d) Some points should be mentioned: 
- there are exceptions from the general arrangements: 
* for exports under food-aid operations, which are not subject 
to any limits on quantity or value, 
* for agricultural products exported in the form of goods not 
listed in Annex II to the EC Treaty, such goods not being 
subject to any limit on quantity; 
- it is necessary to limit the scope for speculation and to create 
a linkage with limits on value; accordingly, it is proposed to 
make advance fixing compulsory, including reference to the 
destination but allowing changes to another destination within 
the same geographical area at the same refund rate; 
- for certain products, the Agreement sets the quantities which 
may be exported with payment of refunds at a level which, in the 
light of experience gained, is unlikely to be exceeded. The 
Regulation takes account of this by making provision for the 
Commission, in accordance with the Management Committee 
procedure, to relax the constraints laid down in this respect 
for the products concerned to the extent appropriate; 
- the pre-financing arrangements should be adapted at a later 
stage, in particular on account of negative experience in 
applying them and with a view to ruling out fraud when they are 
applied. 
D. Other provisions on trade 
1. The provisions on inward processing arrangements have been maintained 
without any substantial change. 
2. The articles oh the prohibition of measures having an effect 
equivalent to customs duties and quantitative restrictions and 
measures having an equivalent effect have been adapted to the new 
arrangements. 
3. The article on shortages in supply has been adapted to the extent 
necessary to take account of the abolition of threshold prices. 
VI 
III. INCLUSION OF THE TRIPS AGREEMENT 
For the first time the GATT Agreements lay down provisions on the 
protection of intellectual property rights. Under this heading there 
are specific provisions on the protection of designations of origin. 
The Community regulations in force lay down rules on designations of 
origin in several areas: 
- for wine (quality wine psr), 
- for spirituous beverages, and 
- more generally, for certain agricultural and food products (in 
Regulation (EEC) No 2081/92). 
All these Community regulations (except those on wine) contain a 
reservation relating to international agreements concluded by the 
Community. Since the TRIPS agreement contains special arrangements on 
wine and spirit drinks, specific provisions must be incorporated into 
the relevant regulations. As a result, when the various Community 
arrangements are applied, due account may be taken of the obligations 
and restrictions resulting from the TRIPS Agreement. 
IV. VETERINARY AND PLANT-HEALTH LEGISLATION 
In the veterinary and plant-health fields, the provisions in force 
permit the rules in the relevant Agreement to be applied. However, 
Directive 77/93/EEC on protective measures against the introduction 
into the Community of organisms harmful to plants or plant products 
must be amended to ensure uniform application of the arrangements with 
regard to third countries. 
V. ENTRY INTO FORCE 
In accordance with the Commission's policy decision that the results 
of the Uruguay Round should be implemented as a whole, the proposals 
refer to a Council decision on entry into force which will apply to 
all the sectors concerned. ^ 
H i/ 
Proposal for a 
COUNCIL REGULATION (EC) No . /94 
of 1994 94/ 0228(CNS) 
Ul ..... U3t 
on the adjustments and transitional arrangements required 
in the agriculture sector in order to implement the agreements concluded 
during the Uruguay Round of multilateral trade negotiations 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, and in 
particular Article 43 thereof, 
Having regard to Council Regulation (EEC) No 805/68 of 27 June 1968 on the 
common organization of the market in beef and veal(^), as last amended by 
Regulation (EC) No 1884/94(2), and in particular Article 7(2) thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the Community has adopted a set of rules governing the common 
agricultural policy; 
Whereas, under the Uruguay Round of multilateral trade negotiations, the 
Community has negotiated various agreements (hereinafter referred to as the 
"GATT agreements");, whereas several of those agreements concern agriculture, 
in particular the Agreement on Agriculture (hereinafter referred to as "the 
Agreement"); whereas the concessions relating to domestic support can be 
complied with by setting prices and aid at a suitable level and specific 
provisions need not be laid down on this subject; whereas the Agreement lays 
down a six—year timetable for the extension of access to the Community 
market for agricultural products from third countries on the one hand and 
the gradual reduction in support granted by the Community on exports of 
agricultural products on the other hand; whereas the agricultural 
legislation on trade with third countries should be adapted accordingly; 
(1) OJ No L 148, 28.6.1968, p.24, 
(2) OJ No L 197, 27.7.1994, p.27, 
te 
Whereas, by converting all the measures restricting imports of agricultural 
products into customs duties (tarification) and by prohibiting the 
application of such measures in the future, the Agreement requires the 
abolition of variable import levies and of the other measures and import 
charges currently provided for under the market organizations; whereas the 
rates of customs duty applicable to agricultural products in accordance with 
the Agreement are to be fixed in the common customs tariff; whereas, 
however, for certain product groups such as cereals, rice, wine and fruit 
and vegetables, the introduction of supplementary or other trade mechanisms 
that do not involve the collection of fixed customs duties calls for the 
adoption of rules providing for derogations in the basic Regulations; 
whereas, in addition, the measures to protect the Community market against 
imports of dried grapes and processed cherries can, under the Agreement on 
Safeguards, be maintained for a period of five years; whereas, moreover, in 
order to avert problems of supply to the Community market, the suspension of 
customs duties on certain sugar products should be permitted; 
Whereas, in order to maintain a minimum level of protection against the 
adverse effects on the market as a result of tarification, the Agreement 
permits the application of additional customs duties under precisely defined 
conditions but only to products subject to tarification; whereas the 
corresponding provisions should accordingly be inserted into the basic 
Regulations concerned; 
Whereas the Agreement provides for a series of tariff quotas under 
arrangements for current and minimum access; whereas the conditions 
applicable to such quotas are spelled out in detail in the Agreement; 
whereas the Community has undertaken to open other tariff quotas for certain 
products under special arrangements; whereas, in view of the large number of 
quotas and in order to ensure that they are implemented as effectively as 
possible, the Commission should be responsible for opening and administering 
them using the management committee procedure; 
Whereas the amendments resulting from the framework agreement on bananas 
concluded with certain countries in South America under the Uruguay Round 
should be incorporated in Council Regulation (EEC) No 404/93 of 13 February 
1993 on the common organization of the market in bananas^); 
(3) OJ No L 47, 25.02.1993, p.l. 
Mt 
Whereas, since the Agreement on Safeguards lays down clear rules on the 
application of protective clauses as incorporated in the market 
organizations, such clauses should be supplemented by a reference to the 
obligations flowing from international agreements; 
Whereas in its trading relations with third countries not subject to the 
GATT agreements the Community is not bound by the constraints on access to 
the Community market arising therefrom; whereas, in order to ensure that the 
necessary measures may be taken where applicable with regard to products 
from such countries, the Commission should be given the relevant powers, to 
be exercised through the management committee procedure; 
Whereas, by virtue of the Agreement, the granting of export subsidies is 
limited henceforward to certain groups of agricultural products defined 
therein; whereas, in addition, it is subject to limits in terms of quantity 
and value; 
Whereas compliance with the limits in terms of value can be ensured at the 
time when refunds are fixed and through monitoring of payments under the 
rules relating to the EAGGF; whereas monitoring may be facilitated by the 
compulsory advance fixing of refunds, while allowing the possibility, in the 
case of differentiated refunds, of changing the specified destination within 
the same geographical area to which a single given rate of refund applies; 
Whereas monitoring of constraints in terms of quantity calls for the 
introduction of a reliable and effective system of monitoring; whereas, to 
that end, the granting of refunds should be made subject to an export 
licence; whereas refunds should be granted up to the limits available, 
depending on the particular situation of each product concerned; whereas 
exceptions to that rule can only be permitted in the case of processed 
products not listed in Annex II to the Treaty, to which limits in value do 
not apply, and in the case of food-aid operations, which are exempt from any 
limitation; whereas provision should be made for derogations from strict 
compliance with management rules where exports benefiting from refunds are 
not likely to exceed the limits in quantity .laid down; whereas monitoring of 
the quantities exported with refunds during the marketing years referred to 
in the Agreement can be carried out on the basis of export licences issued 
for each marketing year; 
tf 
Whereas compliance with the Agreement on Trade-Related Aspects of 
Intellectual Property Rights must also be ensured; whereas, to that end, the 
requisite stipulations must be inserted into Council Regulation (EEC) 
No 822/87 of 16 March 1987 on the common organization of the market in 
wine(4), as last amended by Regulation (EEC) No 1891/94(5); 
Whereas, with regard to plant health, Council Directive 77/93/EEC of 
21 December 1976 on protective measures against the introduction into the 
Member States of organisms harmful to plants or plant products and against 
their spread within the Community(6), as last amended by Directive 
94/13/EC^), should be amended in order to provide for uniform 
arrangements vis-à-vis third countries precluding quantitative restrictions 
or measures having equivalent effect; 
Whereas, in the wake of the amendments to the legislation on agriculture 
provided for in this Regulation, many Council Regulations deriving from the 
basic Regulations no longer serve any purpose; whereas, for the sake of 
legal clarity, they should be repealed; whereas certain provisions which 
have lapsed although they are not directly connected with the GATT 
Agreements should also be repealed; 
Whereas the switchover from the existing arrangements to those resulting, 
from the GATT agreements may give rise to difficulties of adaptation which 
are not dealt with in this Regulation; whereas, in order to deal with that 
eventuality, a general provision should be included enabling the Commission 
to adopt the transitional measures necessary for a certain period, 
HAS ADOPTED THIS REGULATION: 
Article 1 
This Regulation lays down the adaptations and transitional measures 
required in the agriculture sector in order to implement the agreements 
concluded during the Uruguay Round of multilateral trade negotiations. 
(4) OJ No L 84, 27.03.1987, p.l. 
(5) OJ No L 197, 30.07.1994, p.42 
(6) OJ No L 26, 31.01.1977, p.20. 
(7) OJ No L 92, 9.4.1994, p. 27. 
kh 
Article 2 
The adaptations referred to in Article 1 are set out in the Annexes hereto. 
Article 3 
1. Where transitional measures are necessary under the common agricultural 
policy in order to facilitate the switchover from the existing 
arrangements to those resulting from the requirements of the agreements 
referred to in Article 1, such measures shall be adopted in accordance 
with the procedure provided for in Article 38 of Regulation No 136/66/EEC 
or, as appropriate, the corresponding Articles in the other Regulations 
on the common organization of agricultural markets, or in Regulation (EC) 
No 3448/93. 
When such measures are adopted, account shall be taken of the special 
features of the various agricultural sectors, having due regard to the 
obligations arising from the agreements referred to in Article 1. 
2. The measures referred to in paragraph 1 may be adopted during a period 
expiring on 31 December 1997 and shall not apply beyond that date. The 
Council, acting by a qualified majority on a proposal from the 
Commission, can extend that period. 
Article 4 
1. Where, in view of the special circumstances affecting an agricultural 
product, compliance with the requirements on export support under the 
agreements referred to in Article 1 can be assured by means having a 
lesser effect than those provided for to that end, the Commission may, to 
the extent and for the period strictly necessary, exempt that product 
from the application of the provisions on export refunds covered by this 
Regulation. 
2. Without prejudice to the provisions of this Regulation, the Commission 
may take any measures necessary to protect the Community market against 
imports of agricultural products from third countries towards which the 
Community has no binding obligations under the agreements referred to in 
Article 1. 
3. Measures pursuant to paragraphs 1 and 2 shall be- adopted in accordance 
with the procedure provided for in Article 3(1). 
'^ 
Article 5 
1. This Regulation shall enter into force on a date determined by a decision 
on the entry into force of the acts implementing the results of the 
Uruguay Round. 
2. It shall apply from 1 July 1995. 
However : 
(a) Article 3 and Article 4(2) shall apply from 1 January 1995; 
(b) the provisions laid down in the Annexes on import duties and 
additional import duties which apply to products listed in 
Annex XIII and XVI for which an entry price is applicable before 
1 July 1995 shall apply as from the commencement during 1995 of the 
marketing year for the products concerned; 
(c) the provisions on export refunds shall apply: 
- as from 1 September 1995 as regards Annexes II and XVI, 
- as from 1 October 1995 as regards Annex IV, 
- as from 1 November 1995 as regards Annex V; 
(d) the provisions laid down in Annex XV shall apply as from [ ]. 
(e) the provisions laid down in Annex XVI, -1.2, shall apply as from 
1 January 1996. 
This Regulation shall be binding in its entirety and directly applicable in 
all Member States. 
Done at For the Council 
tt-U5 
proposal for a 
94/ 0229CC0D) 
PARLIAMENT AND COUNCIL REGULATION 
of 1994 
amending Council Regulation (EEC) No 1576/89 laying down 
general rules on the definition, description and presentation 
of spirit drinks and Council Regulation (EEC) No 1601/91 laying 
down general rules on the definition, description and 
presentation of aromatized wines, aromatized wine-based 
drinks and aromatized wine-product cocktails following the 
Uruguay Round of the multilateral trade negotiations 
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, and in 
particular Articles 43 and 100a thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the Economic and Social Committee, 
Acting in accordance with the procedure referred to in Article 189b of the 
Treaty, 
Whereas Council Regulation (EEC) No 1576/89 of 29 May lgsg*1), as amended 
by Regulation (EEC) No 3280/92(2), and Council Regulation (EEC) No 1601/91 
of 10 June 1991(3), as amended by Regulation (EEC) No 3fi79/92<4), lay down 
general rules for the definition, description and presentation of spirit 
drinks, aromatized wines, aromatized wine-based drinks and aromatized wine-
product cocktails; whereas in order to take account in the said Regulations 
of the obligations arising, in particular, from Articles 23 and 24 of the 
Agreement on Trade-Related Aspects of Intellectual Property Rights, which 
forms an integral part of the Agreement establishing the World Trade 
Organization, provision should be made therein for the parties concerned to 
prevent, under certain* conditions, the unlawful use of geographical 
designations protected by a third country member of the World Trade 
Organization, 
(1) OJ No L 160, 12.6.1989, p. 1. 
(2) OJ No L 327, 13.11.1992, p. 3. 
(3) OJ No L 149, 14.6.1991, p. 1. 
(4) OJ No L 327, 13.11.1992, P. 1. 
S"< 
HAVE ADOPTED THE FOLLOWING REGULATION: 
Article 1 
1. The following Article is inserted after Article 11 of Regulation (EEC) 
No 1576/89: 
"Article 11a 
1. Member States shall adopt all measures necessary to permit those 
concerned to prevent, under the conditions laid down in Articles 23 
and 24 of the Agreement on Trade-Related Aspects of Intellectual 
Property Rights, the use within the Community of a geographical 
designation identifying products covered by this Regulation for 
products which do not originate in the place referred to by the 
geographical designation in question, including in cases where the 
actual origin of the product is indicated or where the geographical 
designation is given in translation or accompanied by expressions 
such as "like", "type", "style", "imitation" or other. 
For the purposes of this Article, "geographical designation" shall 
mean any indication identifying a product as originating in the 
territory of a third country which is a member of the World Trade 
Organization, or in a region or locality of that territory, where a 
quality, reputation or other specific characteristic of that product 
can essentially be attributed to that geographical origin. 
2. Paragraph 1 shall apply notwithstanding Article 11 of this 
Regulation and other provisions of Community legislation laying down 
rules for the description and presentation of products covered by 
this Regulation. 
3. Detailed rules for the application of this Article, where necessary, 
shall be adopted in accordance with the procedure laid down in 
Article 14." 
si 
2. The following Article is inserted after Article 10 of Regulation (EEC) 
No 1601/91: 
"Article 10a 
1. Member States shall adopt all measures necessary to permit those 
concerned to prevent, under the conditions laid down in Articles 23 
and 24 of the Agreement on Trade-Related Aspects of Intellectual 
Property Rights, the use within the Community of a geographical 
designation identifying products covered by this Regulation for 
products which do not originate in the place referred to by the 
geographical designation in question, including in cases where the 
actual origin of the product is indicated or where the geographical 
designation is given in translation or accompanied by expressions 
such as "like", "type", "style", "imitation" or other. 
For the purposes of this Article, "geographical designation" shall 
mean any indication identifying a product as originating in the 
territory of a third country which is a member of the World Trade 
Organization, or in a region or locality of that territory, where a 
quality, reputation or other specific characteristic of that product 
can essentially be attributed to that geographical origin. 
2. Paragraph 1 shall apply notwithstanding Article 10 of this 
Regulation and other provisions of Community legislation laying down 
rules for the description and presentation of products covered by 
this Regulation. 
3. Detailed rules for the application of this Article, where necessary, 
shall be adopted in accordance with the procedure laid down in 
Article 13." 
Article 2 
1. This Regulation shall enter into force on a date determined by a 
decision on the entry into force of the acts implementing the results 
of the Uruguay Round. 
2. It shall apply from 1 January 1996. 
This Regulation shall be binding in its entirety and directly applicable in 
all Member States. 
^JL. 
Done at 
For Parliament For the Council 
S3 
List of Annexes 
ANNEX I Cereals 
ANNEX II Rice 
ANNEX III Dried fodder 
ANNEX IV Sugar 
ANNEX V Oils and fats 
ANNEX VI Flax and hemp 
ANNEX VII Milk products 
ANNEX VIII Beef and veal 
ANNEX IX Sheepmeat and goatmeat 
ANNEX X Pigmeat 
ANNEX XI Poultrymeat 
ANNEX XII Eggs', ovalbumin and lactalbumin 
ANNEX XIII Fruit and vegetables 
ANNEX XIV Processed fruit and vegetables 
ANNEX XV Bananas 
ANNEX XVI Wine 
ANNEX XVII Tobacco 
ANNEX XVIII Hops 
ANNEX XIX Flowers and live plants 
ANNEX XX Seeds 
ANNEX XXI Miscellaneous regulations 
ANNEX XXII Most remote regions 
ANNEX XXIII Plant-health legislation 
Çf 
ANNEX I 
CEREALS 
I. Council Regulation (EEC) No 1766/92 of 30 June 1992 (OJ No L 181, 
1.7.1992, p.21), as amended by Regulation (EEC) No 1866/94 
(OJ No L 197, 30.7.1994, p.l). 
(1) Article 3(2) is deleted. 
(2) The following subparagraph is added to Article 3(3):. 
"The intervention price valid for maize and grain sorghum in May shall 
remain valid in July, August and September of the following marketing 
year." 
(3) The first sentence of the second subparagraph of Article 3(4) is 
replaced by the following: 
"The intervention price shall be subject to monthly increases for the 
whole or part of the marketing year." 
(4) The first and last indents of Article 5 are deleted. 
(5) Title II is replaced by the following: 
"Title II 
Article 9 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1 shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 12 and 13. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
- 18 - K~r-
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 23. t 
Article 10 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
2. Notwithstanding paragraph 1, the import duty on products covered by 
CN codés ex 1001 other than meslin, 1002, 1003, ex 1005 other than 
hybrid seed, and ex 1007 other than hybrid for sowing, shall be equal, 
, to the intervention price valid for such 
products on importation and increased by 55%, minus the import price. 
However, that duty may not exceed the rate of duty in the common 
customs tariff. 
3. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 23. Such detailed 
rules shall cover in particular the measures necessary to determine and 
calculate import prices and to verify their authenticity. 
Article 11 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1, imports of one or more of such products at the rate of duty 
laid down in Article 10 may be subject to payment of an additional 
import duty under the conditions set out in Article 5 of the Agreement 
on Agriculture concluded in accordance with Article 228 of the Treaty 
in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 23. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
- 19 - r . 
Article 12 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 23. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 13 
1. To the extent necessary to enable the products listed in Article 1 to 
be exported without further processing or in the form of goods listed 
in Annex B on the basis of quotations or prices for those products on 
the world market and within the limits resulting from agreements 
concluded in accordance with Article 228 of the Treaty, the difference 
between those quotations or prices and prices in the Community may be 
covered by export refunds. 
Export refunds on the products listed in Article 1 in the form of goods 
listed in Annex B may not be higher than those applicable to such 
products exported without further processing. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 23. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervenirig period by the Commission at the request of a Member 
State or its own initiative. 
3. Refunds on products listed in Article 1 and exported without further 
processing shall only be granted on application and on presentation of 
the relevant export licence. 
4. The refund applicable to exports of products listed in Article 1 
exported without further processing shall be that applicable on the day 
of application for the licence and, in the case of a differentiated 
-refund, that applicable on the same day for the destination indicated 
on the licence. 
5. Paragraphs 3 and 4 may be made to apply to products listed in Article 1 
and exported in the form of goods listed in Annex B in accordance with 
the procedure laid down in Article 16 of Regulation (EC) No 3448/93. 
6. Paragraphs 3 and 4 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 23. 
7. Save as otherwise provided in accordance with the procedure laid down 
in Article 23, the refund on products listed in Article 1(1)(a) and (b) 
in accordance with paragraph 4 shall be adjusted, during the period 
from August to June of the same marketing year, in respect of each 
month elapsing prior to export, by an amount equal to the monthly 
increase applicable to the intervention price fixed.for that marketing 
year. 
A corrective amount may be fixed in accordance with the procedure laid 
down in Article 23. However, the Commission may, where necessary, alter 
corrective amounts. 
The first and second subparagraphs may be applied, in whole or in part, 
to products listed in Article 1(1)(c) and (d) and to products listed in 
Article 1 and exported in the form of goods listed in Annex B. In that 
case, the adjustment referred to in the first subparagraph shall be 
corrected by applying to the monthly increase a coefficient expressing 
the ratio between the quantity of basic product and the quantity of the 
latter contained in the processed product exported or used in the goods 
exported. 
8. In so far as is necessary to take account of the features of production 
peculiar to certain spirituous beverages obtained from cereals, the 
criteria for granting export refunds as provided for in paragraph 1 and 
the procedures for verification may be adapted to fit this particular 
situation. 
9. Detailed rules for the application of this Article and in particular 
those on the adaptation provided for in paragraph 8 shall be adopted in 
accordance with the procedure laid down in Article 23. Annex B shall be 
amended in accordance with the same procedure. 
Article 14 
1. To the extent necessary for the proper working of the common 
organization of the market in cereals, the use of inward processing 
arrangements may be prohibited in whole or in part: 
- in respect of products listed in Article 1 which are intended for 
the manufacture of products listed in Article 1(1)(c) and (d), and 
in special cases, in respect of products listed in Article 1 which 
are intended for the manufacture of goods listed in Annex B. 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 23. 
Article 15 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a-
provision thereof,, the following shall be prohibited in trade with 
third countries: 
the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
1 Article 16 
1. Where the quotations or prices on the world market for one or more of 
the products listed in Article 1 reach the level of Community prices 
and where that situation is likely to continue and to deteriorate, 
thereby disturbing or threatening to disturb the Community market, 
appropriate measures may be taken. 
2. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 23. 
- 22 -
Article 17 Si 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 23. . 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
6. The following is added to Annex A: 
"CN code Description 
2306 Oil-cake and other solid residues, whether or not 
ground or in the form of pellets, resulting from the 
extraction of vegetable fats or oils, other than 
those of headings 2304 and 2305 
2306 90 - other: 
— other 
2306 90 91 —- of germ of maize " 
II. Council Regulation (EEC) No 2729/75 of 29 October 1975 (OJ No L 281, 
1.11.1975, p.18). 
The terms "levy" and "levies" are replaced by "duty" and "duties" 
respectively. 
- 23 -
ANNEX II 
RICE 
I. Council Regulation (EEC) No 1418/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.l), as last amended by Regulation (EEC) No 1869/94 (OJ 
No L 197, 30.7.1994, p.7). 
(1) Article 4(5) is replaced by the following: 
"5. The following shall be determined in accordance with the procedure 
provided for in Article 27: 
a) after consultation with the Member States, the intervention centres 
referred to in paragraph 4, 
b) the rate for converting husked rice into paddy rice, or vice versa, 
and 
c) processing costs and the value of by-products to be taken into 
consideration for the application of paragraph 3." 
(2) Title II is replaced by the following: 
"Title II 
Trade with third,countries 
Article 10 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1 shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 14 and 15. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
- 24 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 27. 
Article 11 
1. A subsidy may be fixed for consignments to the French overseas 
department of Réunion of products falling within CN code 1006 
(excluding code 1006 10 10) which come from the Member States and are 
in one of the situations referred to in Article 9(2) of the Treaty. 
That subsidy shall be fixed, taking into account the supply 
requirements of the Réunion market, on the basis of the difference 
between the quotations or prices of the relevant products on the world 
market and the quotations or prices of those products on the Community 
market, and, if necessary the price of those products delivered to 
Réunion. 
The subsidy shall be granted on application by the party concerned. 
The subsidy may be fixed, where appropriate, by tendering procedure. 
This tender shall involve the subsidy amount. 
The subsidy shall be fixed periodically in accordance with the 
procedure laid down in Article 27. However, where the need arises, the 
Commission may, at the request of a Member State or on its own 
initiative, alter the subsidy in the interval. 
2. The rules on the financing of the common agricultural policy shall 
apply to the subsidy provided for in paragraph 1. 
3. The detailed rules for the application of this Article shall be adopted 
in accordance with the procedure laid down in Article 27. 
- 25 -
Article 12 u 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
2. Notwithstanding paragraph 1, the import duty on: 
(a) husked rice covered by CN code 1006 20 shall be equal, 
to the intervention price valid for indica 
rice and japonica rice respectively on importation increased by 
- 80% in the case of indica rice and 
- 88% in the case of japonica rice, 
minus the import price; and 
(b) wholly milled rice covered by CN code NC 1006 30 shall be equal, 
to the intervention price at the 
time of importation plus a percentage to be calculated and minus 
the import price. 
However, that duty may not exceed the rate of duty in the common 
customs tariff. 
The percentage referred to in b) shall be calculated by adjusting the 
respective percentages referred to in a) by reference to the conversion 
rate, processing costs and the value of by-products, and then adding an 
amount for the protection of the industry. 
3. Notwithstanding paragraph 1: 
(a) no duty shall be charged on imports of products falling within 
products covered by CN code 1006 10 10, CN 1006 20 or 
CN 1006 40 00 into the French overseas department of Réunion, 
(b) the duty to be charged on imports of products falling within 
CN code 1006 30 into the French overseas department of Reunion 
shall be muliplied by a coefficient of 0,30. 
4. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 27. Such detailed 
rules shall in particular lay down the criteria for distinguishing the 
types of imported rice referred to in paragraph 2, fix the amount for 
the protection of the industry and include the necessary provisions for 
determining and calculating import prices and checking their 
authenticity. 
- 26 -
Article 13 lo3 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1, imports of one or more of such products at the rate of duty 
laid down in Article 12 may be subject to payment of an additional 
import duty under the conditions set out in Article 5 of the Agreement 
on Agriculture concluded in accordance with Article 228 of the Treaty 
in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 27. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 14 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules established 
pursuant to Article 27. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where 
appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 15 
1. To the extent necessary to enable the products listed in Article 1 to 
be exported without further processing or in the form of goods listed 
in Annex B on the basis of quotations or prices for those products on 
the world market and within the limits resulting from agreements 
concluded in accordance.with Article 228 of the Treaty, the difference 
between those quotations or prices and prices in the Community may be 
covered by export refunds. 
- 27 Gt 
Export refunds on the products listed in Article 1 in the form of goods 
listed in Annex B may not be higher than those applicable to such 
products exported without further processing. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 27. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
When the amount of the refund is set, account shall be taken in 
particular of the need to establish a balance between the use of 
Community basic agricultural products for export as processed goods to 
third countries, and the use of products from these countries admitted 
for inward processing. 
3. Refunds on products listed in Article 1 and exported without further 
processing shall only be granted on application and on presentation of 
the relevant export licence. 
4. The refund applicable to exports of products listed in Article 1 
exported without further processing shall be that applicable on the day 
of application for the licence and, in the case of a differentiated 
refund, that applicable on the same day for the destination indicated 
on the licence. 
5. Paragraphs 3 and 4 may be made to apply to products listed in Article 1 
and exported in the form of goods listed in Annex B in accordance with 
the procedure laid down in Article 16 of Regulation (EC) No 3448/93. 
6. Paragraphs 3 and 4 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 27. 
7. Save as otherwise provided in accordance with the procedure laid down 
in Article 27, the refund on products listed in Article l(l)(a) and (b) 
in accordance with paragraph 4 shall be adjusted, during the period 
from October to July of the same marketing year, in respect of each 
month elapsing prior to export, by an amount equal to the monthly 
increase applicable to the intervention price fixed for that marketing 
year, adjusted according to the degree of processing using the 
applicable conversion rate. 
us 
A corrective amount may be fixed in accordance with the procedure laid 
down in Article 27. However, the Commission may, where necessary, alt,er 
corrective amounts. 
The first and second subparagraphs may be applied, in whole or in part, 
to products listed in Article 1(1)(c) and to products listed in 
Article 1 and exported in the form of goods listed in Annex B. In that 
case, the adjustment referred to in the first subparagraph shall be 
corrected by applying to the monthly increase a coefficient expressing 
the ratio between the quantity of basic product and the quantity of the 
latter contained in the processed product exported or used in the goods 
exported. 
8. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 27. Annex B shall be 
amended in accordance with the same procedure. 
Article 16 
1. To the extent necessary for the proper working of the common 
organization of the market in rice, the use of inward processing 
arrangements may be prohibited in whole or in part in respect of 
products listed in Article 1. 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 27. 
Article 17 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the* application of this Regulation, 
including the definitions listed in Annex A, shall be incorporated in 
the common customs tariff. 
2. Save as otherwise^ provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited: 
the. levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction on imports or 
measure having equivalent effect. 
- 29 -
Article 18 Ok 
1. Where the quotations or prices on the world market for one or more of 
the products listed in Article 1(a) or (b) reach the level of Community 
prices and where that situation is likely to continue and to 
deteriorate, thereby disturbing or threatening to disturb the Community 
market, appropriate measures may be taken. 
2. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 27. 
Article 19 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 27. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the v 
Treaty." 
II. Council Regulation (EEC) No 1423/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.20). 
Article 3 is deleted. 
- 30 -
III. Council Regulation (EEC) No 1428/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.30). 
Council Regulation* (EEC) No 1431/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.36). 
Council Regulation (EEC) No 1432/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.39). 
Council Regulation (EEC) No 1433/76 of 21 June 1976 (OJ No L 166, 
25.6.1976, p.42). 
Council Regulation (EEC) No 1263/78 of 12 June 1978 (OJ No L 156, 
14.6.1976, p.14). 
The above Regulations are repealed. U 
- 31 -
ANNEX III 
DRIED FODDER 
Council Regulation (EEC) No 117/78 of 22 May 1978 (OJ No L 142, 30.5.1978, 
p.2), as last amended by Regulation (EEC) No 3496/93 (OJ No L 319, 
21.12.1993, p.17) 
(1) In Title II the following Article is inserted before Article 7: 
"Article 6a 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1." 
(2) Article 7(2) is replaced by the following: 
"Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with third 
countries: 
the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect". 
(3) After Article 7 the following Article is inserted: 
"Article 7a 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted according to the 
procedure laid down in Article 12. Such detailed rules shall provide for 
annual quotas, suitably phased over the year, to be opened and, where 
appropriate, for: 
- 32 - / n 
O "i 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity." 
(4) Article 8 is replaced by the following: 
"Article 8 
1. If, by reason of an increase in imports or exports, the Community • 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives, a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It•may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 12. 
5. This Article shall be applied in compliance with the obligations 
arising from agreements concluded in accordance with Article 228(2) of 
the Treaty. •• 
1o - 33 -
ANNEX IV 
SUGAR 
I. Council Regulation (EEC) No 1785/81 of 30 June 1981 (OJ No L 177, 
1.7.1981, p.4), as last amended by Regulation (EC) No 133/94 
(OJ No L 22, 27.1.1994, p.7). 
(1) Title II is replaced by the following: 
"Title II 
Trade with third countries 
Article 13 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(1)(a), (b), (c), (d), (f), (g) and (h) 
shall be subject to presentation'of an import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 16 and. 17. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. In accordance with the procedure laid down in Article 41: 
(a) the scheme provided for by this Article may be extended to cover, 
the products listed in Article 1(1)(e), 
(b) the term of validity of licences and other detailed rules for 
the application of this Article, which may lay down in 
particular a time limit for the issue of licences, shall be 
adopted. 
- 34 
Article 14 V 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
2. Notwithstanding paragraph 1, to ensure that the Community market is 
adequately supplied with the products listed in Article 1(1)(a) (raw 
sugar for refining falling within CN codes 1701 11 10 and 1701 12 10) 
and Article 1(1)(c) (molasses) by means of imports from third 
countries, the Commission may, in accordance with the procedure laid 
down in Article 41, suspend in whole or in part the application of 
import duties on these products, and establish the arrangements for any 
such suspension. 
Article 15 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain agricultural 
products, imports of one or more of such products at the rate of duty 
laid down in the common customs tariff may be subject to payment of an 
additional import duty under the conditions set out in Article 5 of the 
Agreement on Agriculture concluded in accordance with Article 228 of 
the Treaty in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 41. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
n 
Article 16 
1. Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 41. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 17 
1. To the extent necessary to enable the products listed in 
Article 1(1)(a), (c) and (d) to be exported without further processing 
or in the form of goods listed in Annex I, on the basis of quotations 
or prices on the world market for those products listed in 
Article 1(1)(a) and (c), and within the limits resulting from 
agreements concluded in accordance wit,h Article 228 of the Treaty, the 
difference between those quotations or prices and prices in the 
Community may be covered by export refunds. 
The export refund granted for raw sugar may not exceed that granted for 
white sugar. 
2. Provision may be made for export refunds in respect of the products 
listed in Article 1(1)(f), (g) and (h) and exported without further 
processing or in the form of goods mentioned in Annex I. 
When determining the amount of the refund, for each 100 kg of dry 
matter particular account shall be taken of: 
(a) the refund applicable to exports of products falling within 
subheading 1702 30 91 of the Combined Nomenclature, 
(b) the refund applicable to exports of the products referred to in 
Article 1(1)(d), 
(C) the economic aspects of the planned exports. 
- 36 11 
3. The refund applicable to products listed in Article 1 exported in the 
form of good listed in Annex I shall not be greater than that 
applicable to these products exported without further processing. 
4. When the amount of the refund is set, account shall be taken in 
particular of the need to establish.a balance between the use of 
Community basic agricultural products for export as processed goods to 
third countries, and the use of products from these countries admitted 
for inward processing. 
Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 41. Refunds may- be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
5. Refunds on products listed in Article 1 and exported without further 
processing shall only be granted on application and on presentation of 
the relevant export licence. 
6. The refund applicable to- exports of products listed in Article 1 
exported without further processing shall be that applicable on the day 
of application for the licence and, in the case of a differentiated 
refund, that applicable on the same day for the destination indicated 
on the licence. 
7. Paragraphs 5 and 6 may be made to apply to products listed in Article 1 
and exported in the form of goods listed in Annex I, in accordance with 
the procedure laid down in Article 16 of Regulation (EC) No 3448/93. 
8. Paragraphs 5 and 6 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 41. 
9. Detailed rules for the application of this Article and the amendment of 
Annex I shall be adopted in accordance with the procedure laid down in 
•Article 41. 
- 37 -
Article 18 ^ 
1. To the extent necessary for the proper working of the common 
organization of the market in sugar, the use of inward processing 
arrangements may be prohibited in whole or in part: 
in respect of products listed in Article 1(a) and (d), and 
in special cases, in si^i&pjejg^t 1(of products listed in Article 1(1) 
which are intended for the manufacture of goods listed in Annex I. 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 41. 
Article 19 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulatiort shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
(a) the levying of any charge having equivalent effect to a customs 
duty, 
(b) the application of any quantitative restriction or measure 
having equivalent effect. 
Article 20 
1. Where the price of sugar on the world market exceeds the intervention 
price, provision may be made to apply an export levy in respect of the 
sugar in question. This levy must be applied when the cif price of 
white sugar or raw sugar is greater than the reference price. 
Save as otherwise provided in accordance with the procedure laid down 
in Article 41, the levy payable shall be that applicable on the date of 
export. 
2. Where the cif price of white or raw sugar is greater than a reference 
price to be determined, a decision may be made to suspend the 
applicable import duty and/or grant an import subsidy for the product 
in question. 
- 38 -1C 
3. The following shall be adopted in accordance with the procedure laid 
down in Article 41: 
(a) the detailed rules for establishing the cif prices referred to . 
in paragraph 2, 
(b) the reference price referred to in paragraphs 1 and 2, 
(c) the decisions referred to in-pa-r&qr^aphs 1 and 2, 
(d) the detailed rules for the application of this Article. 
In the case of the products referred to in Article 1(1)(b), (c), (d), 
(f), (g) and (h) provisions similar to those in paragraphs 1 and 2 and 
to the rules for their application may be adopted using the same 
procedure. 
4. The levies stemming from the application of this Article shall be fixed 
by the Commission. 
Article 21 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 41. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
- 39 -
y, 
(2) Article 26 is amended as follows: 
(a) In paragraph 1 the last sentence is replaced by: 
"Articles 8, 9, 17 and 20 shall not apply to such sugar and Articles 9, 
17 and 20 to such isoglucose and inulin sirop." 
(b) The reference to "Article 18" in paragraph 2 is replaced by a reference 
to "Article 20". 
(3) Article 35(1) is replaced by the following: 
"1. No import duty shall apply to imports of preferential sugar." 
II. Council Regulation (EEC) No 431/68 of 9 April 1968 (OJ No L 89, 
10.4.1968, p.3) 
Article 2 is deleted. 
III. Council Regulation (EEC) No 766/68 of 18 June 1968 (OJ No L 143, 
25.6.1968, p.6), as last amended by Regulation (EEC) No 1489/76 (OJ 
No L 167, 26.6.1976, p.13) 
Council Regulation (EEC) No 770/68 of 18 June 1968 (OJ No L 143, 
25.6.1968, p.16) 
Council Regulation (EEC) No 226/72 of 31 January 1972 (OJ No L 28, 
1.2.1972, p.3) 
Council Regulation (EEC) No 608/72 of 23 March 1972 (OJ No L 75, 
28.3.1972, p.5) 
The above Regulations are repealed. 
- 40 -
11 
ANNEX V 
OILS AND FATS 
:. Council Regulation No 136/66/EEC of 22 September 1966 (OJ No 172, 
30.9.1966, p.3025/66), as last amended by Regulation (EC) No 3179/93 
(OJ No L 285, 20.11.1993, p.9). 
(1) Title I is replaced by the following: 
"Title I 
Trade 
Article 2 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(2) shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 2c and 3. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 38. 
Article 2a 
Save where this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in 
Article 1(2). 
Article 2b 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(2)(c), (d) and (e), imports of one or more of such products 
at the rate of duty laid down in the common customs tariff may be 
subject to payment of an additional import duty under the conditions 
set out in Article 5 of the Agreement on Agriculture concluded in 
accordance with Article 228 of the Treaty in the framework of the 
Uruguay Round of multilateral trade negotiations. 
u 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 38. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 2c 
1. Tariff quotas for the products listed in Article 1(2) resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 38. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 3 
1. To the extent necessary to enable the olive oil and oilseeds harvested 
in the Community to be exported on the basis of quotations or prices 
for those products on the world market and within the limits resulting 
from agreements concluded in accordance with Article 228 of the Treaty, 
the difference between those quotations or prices and prices in the 
Community may be covered by export refunds. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination.• . 
Refunds shall be fixed in accordance w,ith the procedure laid down in 
Article 38. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. Refunds shall only be granted on request and on presentation of the 
relevant export licence. 
- 42 - Zj G 
4. The refund applicable to exports of products listed in paragraph 1 
shall be that applicable on the day of application for the licence and, 
in the case of a differentiated refund, that applicable on the same day 
for the destination indicated on the licence. 
5. Paragraphs 3 and 4 may be waived in the case of olive oil and oilseeds 
on which refunds are paid under food-aid operations, in accordance with 
the procedure laid down in Article -3^; • 
« 3 3 01 "5 
6. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 38. 
Article 3a 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited, in trade with 
third countries: 
the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
Article 3b 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(2) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 38. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
(2) Article 4(1) is replaced by the following: 
"1. A production target price, an intervention price and a representative 
market price for olive oil shall be fixed each year for the Community. 
However, when during the marketing year the factors which are used to 
determine the representative market price for olive oil undergo a 
change which, on the basis of the criterion to be established under the 
procedure laid down in Article 38, may be considered as substantial, a 
decision may be taken under the said procedure to adjust the 
representative market price during the marketing year. 
In such cases, the level of consumption aid referred to in 
Article 11(5) and (6) may be adjusted in accordance with the same 
procedure." 
(3) Articles 9, 14, 15, 16, 17, 18 and 19 are deleted. 
(4) Article 20 is replaced by the following: 
"Article 20 
1. Where olive oil is exported to third countries and world prices are 
higher than the Community price, a levy to cover the difference may be 
charged. 
2. The general rules for the application of this Article shall be adopted 
in accordance with the procedure laid down in Article 38." 
(5) Article 20a is replaced by the following: 
"Article 20a 
Olive oil used for the manufacture of preserved foods shall benefit 
from a system of production refunds. 
The general rules for the application of this Article and the list of 
preserved foods in question shall be adopted in accordance with the 
procedure laid down in Article 38." 
(6) Articles 20c and 28 are deleted. 
- 44 - 9 
II. Regulation (EEC) No 142/67 of 21 June 1967 (OJ No L 125,' 26.6.1967, 
p.2461/67), as last amended by Regulation (EEC) No 2429/72 
(OJ No L 264, 23.11.1972, p.l.) 
Regulation (EEC) No 143/67 of 21 June 1967 (OJ No L 125, 26.6.1967, 
p.2463/67), as last amended by Regulation (EEC) No 2077/71 
(OJ No L 220, 30.9.1971, p.l.) 
Regulation (EEC) No 19/69 of 20 December 1968 (OJ No L 3, 7.1.1969, 
p.2), as last amended by Regulation (EEC) No 2429/72 (OJ No L 264, 
23.11.1972, p.l.) 
Regulation (EEC) No 2596/69 of 18 December 1969 (OJ No L 324, 
27.12.1969, p.12) 
Regulation (EEC) No 1076/71 of 25 May 1971 (OJ No L 116, 28.5.1971, 
p.2) 
Regulation (EEC) No 443/72 of 29 February 1972 (OJ No L 54, 3.3.1972, 
p.3), as last amended by Regulation (EEC) No 2560/77 (OJ No L 303, 
28.11.1977, p.l.) 
Regulation (EEC) No 1569/72 of 20 July 1972 (OJ No L 167, 25.7.1972, 
p.9), as last amended by Regulation (EEC) No 2206/90 (OJ No L 201, 
31.1.1990, p.11.) 
Regulation (EEC) No 2751/78 of 23 November 1978 (OJ No L 331, 
28.11.1978, p.5) 
Regulation (EEC) No 591/79 of 26 March 1979 (OJ No L 78, 30^3.1979, 
p.2), as last amended by Regulation (EEC) No 2903/89 (OJ No L 280, 
29.9.1989, p.3.) 
Regulation (EEC) No 1594/83 of 14 June 1983 (OJ No L 163, 22.6.1983, 
p.44), as last amended by Regulation (EEC) No 1321/90 (OJ No L 132, 
23.5.1990, p.15.) 
-45- Q a 
Regulation (EEC) No 1491/85 of 23 May 1985 (OJ No L 151, 10.6.1985, 
p.15), as last amended by Regulation (EEC) No 1724/91 (OJ No L 162, 
26.6.1991, p.35.) 
Regulation (EEC) No 2194/85 of 25 July 1985 (OJ No L 204, 2.8.1985, 
p.7), as last amended by Regulation (EEC) No 1725/91 (OJ No L 162, 
26.6.1991, p.37.) 
Regulation (EEC) No 1650/86 of 26 May 1986 (OJ No L 145, 30.5.1986, 
p.8). 
The above Regulations are repealed. 
s? - 46 -
ANNEX VI 
FLAX AND HEMP 
I. Council Regulation (EEC) No 1308/70 of 29 June 1970 (OJ No L 146, 
4.7.1970, p.l), as last amended by Regulation (EEC) No 1557/93 (OJ No 
L 154, 25.6.1993, p.26). 
Articles 7 and 8 are replaced by the following: 
"Article 7 
Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with third 
countries: 
the levying of any charge having equivalent effect to a customs duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 8 
1. The importation of raw hemp falling within CN code 5302 10 00 is 
permitted only if the product meets the conditions laid down in 
Article 4(1). 
2. The importation of hemp seed falling within CN code 1207 99 10 is 
permitted only if the seed offers the guarantees laid down in 
Article 4(1). 
3. The importation of hemp seed, not broken, falling within CN code 
1207 99 91 is permitted only if it undergoes a check guaranteeing that 
the seed will be used other than for sowing. 
4. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 12. 
Article 8a 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
- 47 -iy 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 12. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
II. Council Regulation (EEC) No 1054/72 of 18 May 1972 (OJ No L 120, 
25.5.1972, p.l). 
The above Regulation is repealed. 
fc - 48 -
ANNEX VII 
MILK PRODUCTS 
I. Council Regulation (EEC) No 804/68 of 27 June 1968 (OJ No L 148, 
28.6.1968, p.13), as last amended by Regulation (EC) No 1880/94 (OJ No 
L 197, 30.7.1994, p.21). 
(1) Article 4 is deleted. 
(2) Title III is replaced by the following: 
"Title III 
Trade with third countries 
Article 13 
1. Imports into the Community of any of the products listed in Article 1 
shall be subject to the presentation of an import licence. Exports from 
the Community of any such products may be made subject to presentation 
of an export licence. 
2. Licences shall be issued by Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to the measures taken for the application of Articles 16 
and 17. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
3. The following shall be adopted in accordance with the procedure laid 
down in Article 30: 
(a) the list of products in respect of which import and export 
licences are required, 
(b) the term of validity of the licences, and 
(c) the other detailed rules for the application of this Article. 
- 49 -
Article 14 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1. 
Article 15 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1, imports of one or more of such products at the rate of duty 
laid down in the common customs tariff may be subject to payment of an 
additional import duty under the conditions set out in Article 5 of the 
Agreement on Agriculture concluded in accordance with Article 228 of 
the Treaty in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 30. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 16 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 30. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
- 50 
Article 17 
1. To the extent necessary to enable the products listed in Article 1 to 
be exported without further processing or in the form of goods listed 
in the Annex if they are products listed in Article 1(a), (b), (c), 
(d), (e) and (g), on the basis of prices for those products on the 
world market and within the limits resulting from agreements concluded 
in accordance with Article 228 of the Treaty, the difference between 
those prices and prices in the Community may be covered by export 
refunds. 
Export refunds on the products listed in Article 1 in the form of goods 
listed in the Annex may not be higher than those applicable to such 
products exported without further processing. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 30. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
When the refund is.being fixed particular account shall be taken of the 
need to establish a balance between the use of Community basic products 
in the manufacture of processed goods to third countries and the use of 
products from these countries admitted for processing. 
3. Refunds on products listed in Article 1 and exported without further 
processing shall only be granted on application and on presentation of 
the relevant export licence. 
- 51 - u 
4. The refund applicable to exports of products listed in Article 1 
exported without further processing shall be that applicable on the day 
of application for the licence and, in the case of a differentiated 
refund, that applicable on the same day for the destination indicated 
on the licence. 
5. Paragraphs 3 and 4 may be made to apply to products listed in Article 1 
and exported in the form of goods listed in the Annex in accordance 
with the procedure laid down in Article 16 of Regulation (EC) 
No 3448/93. 
6. Paragraphs 3 and 4 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 30. 
7. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 30. 
Article 18 
To the extent necessary for the proper working of the common organization 
of the market in milk and milk products the Commission may in special 
cases, in accordance with the procedure laid down in Article 30, prohibit 
in whole or in part the use of inward processing arrangements,in respect of 
products listed in Article 1 which are intended for the manufacture of 
products listed in that Article or of goods listed in the Annex. 
Article 19 
1. The general rules for the interpretation of the combined nomenclature 
and tfhe special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
- 52 -
Article 20 ri 
1. Where the quotations or prices on the world market for one or more of 
the products listed in Article 1 reach the level of Community prices 
and where that situation is likely to continue and to deteriorate, 
thereby disturbing or threatening to disturb the Community market, 
appropriate measures may be taken. 
2. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 30. 
Article 21 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 30. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
II. Council Regulation (EEC) No 876/68 of 28 June 1968 (OJ No L 155, 
3.7.1968, p.l), as last amended by Regulation (EEC) No 1344/86 
(OJ No L 119, 8.5.1986, p.36). 
Council Regulation (EEC) No 2115/71 of 28 September 1971 (OJ No L 222, 
2.10.1971, p.5). 
Council Regulation (EEC) No 2180/71 of 12 October 1971 (OJ No L 231, 
14.10.1971, p.l). 
- 53 - q 
Council Regulation (EEC) No 1603/74 of 25 June 1974 (OJ No L 172, 
27.6.1974, p.9). 
Council Regulation (EEC) No 2915/79 of 18 December 1979 (OJ No L 329, 
24.12.1979, p.l), as last amended by Regulation (EEC) No 3798/91 
(OJ No L 357, 28.12.1991, p.3). 
The above Regulations are repealed. 
<\l - 54 -
ANNEX VIII 
BEEF AND VEAL 
I. Council Regulation (EEC) No 805/68 of 27 June 1968 (OJ No L 148, 
28.6.1968, p.24), as last amended by Regulation (EC) No 1884/94 
(OJ No L 197, 30.7.1994, p.27). 
(1) Article 3 is deleted. 
(2) Title II is replaced by the following: 
"Title II 
Trade with third countries 
Article 9 
1. Imports into the Community of any of the products listed in 
Article 1(1)(a) shall be subject to presentation of an import licence. 
Imports into the Community of any of the products listed in 
Article 1(1)(b) and exports from the Community of products listed in 
Article 1(1)(a) and (b) may be subject to presentation of an import or 
export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 12 and 13. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
- 55 -n 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 27. 
Article 10 
Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
Article 11 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain agricultural 
products listed in Article 1, imports of one or more of such products 
at the rate of duty laid down in the common customs tariff may be 
subject to payment of an additional import duty under the conditions 
set out in Article 5 of the Agreement on Agriculture concluded in 
accordance with Article 228 of the Treaty in the framework of the 
Uruguay Round of multilateral trade negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 27. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 12 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 27. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
Article 13 
1. To the extent necessary to enable the products listed in Article 1 to 
be exported on the basis of quotations or prices for. those products on 
the world market and within the limits resulting from agreements 
concluded in accordance with Article 228 of the Treaty, the difference 
between those quotations or prices and prices in the Community may be 
covered by export refunds. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 27. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
- 57 - O.LI 
I I 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. When the amount of the refund is set, account shall be taken in 
particular of the need to establish a balance between the use of 
Community basic agricultural products for export as processed goods to 
third countries and the use of products from these countries admitted 
for inward processing. 
4. Refunds shall be granted only on application and on presentation of the 
relevant export licence. 
5. The refund applicable to exports of products listed in Article 1 
exported shall be that applicable on the day of application for the 
licence and, in the case of a differentiated refund, that applicable on 
the same day for the destination indicated on the licence. 
6. Paragraphs 3 and 4 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 27. 
7. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 27. 
Article 14 
To the extent necessary for the proper working of the common organization 
of the market in beef and veal, the Commission, acting in accordance with 
the procedure laid down in Article 27, may prohibit the use of inward or 
outward processing arrangements in whole or in part for the products listed 
in Article 1. 
Article 15 
The general rules for the interpretation of the Combined Nomenclature 
and the detailed rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 16 
If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
- 59 -% 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 27. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
(3) Article 22a is amended as follows: 
(a) paragraph 2 is deleted. 
(b) paragraph 3 becomes paragraph 2. 
II. Council Regulation (EEC) No 98/69 of 16 January 1969 (OJ No L 14, 
21.1.1969, p.2), as amended by Regulation (EEC) No 429/77 (OJ No L 61, 
5.3.1977, p.18) 
Article 1 is replaced by the following: 
"Article 1 
1. Disposal of the products held by intervention agencies may be 
undertaken only: 
(a) where the products are intended for a particular use, or 
(b) where the products are intended for export, or 
(c) in the case of disposal without a specific destination, if no 
risk of disturbance of the market results, having regard in 
particular to the level of average market prices for adult 
bovine animals in the Community and in the Member States, as 
recorded in accordance with Regulation (EEC) No 1982/87, or 
- 60 -S3 
(d) where removal from storage is necessary for technical reasons. 
In the cases referred to in paragraph 1(a) and (b), special conditions 
may be laid down to ensure that the products are not used for a purpose 
other than that for which they were intended and to take- account of the 
particular requirements of such sales. 
To ensure that the obligations entered into are fulfilled, such 
conditions may include the provision of a security which shall be 
forfeited in whole or in part if the said obligations are not or are 
only partially fulfilled." 
III. Council Regulation (EEC) No 885/68 of 28 June 1968 (OJ No L 156, 
4.7.1968, p.2), as last amended by Regulation (EEC) No 427/77 
(OJ No L 61, 5.3.1977, p.16) 
Council Regulation (EEC) No 1157/92 of 28 April 1992 (OJ No L 122, 
7.5.1992, p.4) 
The above Regulations are repealed. 
- 61 -
11 
ANNEX IX 
SHEEPMEAT AND GOATMEAT 
I. Council Regulation (EEC) No 3013/89 of 25 September 1989 (OJ No L 289, 
7.10.1989, p.l), as last amended by Regulation (EC) No 1886/94 (OJ No L 
197, 30.7.1994, p.30). 
Title II is replaced by the following: 
"Title II 
Trade with third countries 
Article 9 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1 may be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of. his place of establishment in the Community and without 
prejudice to measures taken for the application of Article 12. 
Import and export licences shall be valid throughout the Community. The 
issuing of such licences may be subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 30. 
- 62 -
Article 10 T] 
Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1 
Article 11 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1, imports of one or more of such products at the rate of duty 
laid down in the common customs tariff may be subject to payment of an 
additional import duty under the conditions set out in Article 5 of the 
Agreement on Agriculture concluded in accordance with Article 228 of 
the Treaty in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 30. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 12 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 30. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
- 63 -\oo 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 13 
1. To the extent necessary for the proper working of the common 
organization of the market in sheepmeat and goatmeat, the use of inward 
or outward processing arrangements may be prohibited in whole or in 
part for the products listed in Article 1. 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 23. 
Article 14 
1. The general rules for the interpretation of the Combined Nomenclature 
and the detailed rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
- 64 -
Article 15 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 30. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
II. Council Regulation (EEC) No 2641/80 of 14 October 1980 (OJ No L 275, 
18.10.1980, p.2), as last amended by Regulation (EEC) No 3890/92 
(OJ No L 391, 31.12.1992, p.51) 
Council Regulation (EEC) No 2642/80 of 14 October 1980 (OJ No L 275, 
18.10.1980, p.4), as last amended by Regulation (EEC) No 3939/87 
(OJ No L 373, 31.12.1987, p.l) 
- 65 - J „ 
Council Regulation (EEC) No 3643/85 of 19 December 1985 (OJ No L 348, 
24.12.1985, p.2), as last amended by Regulation (EEC) No 3890/92 
(OJ No L 391, 31.12.1992, p.51) 
The above Regulations are repealed. 
- 66 -
ANNEX X 
PIGMEAT 
Council Regulation (EEC) No 2759/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.l), as last amended by Regulation (EEC) No 1249/89 
(OJ No L 129, 11.5.1989, p.12). 
(1) The second subparagraph of Article 4(1) is replaced by the following: 
"The basic price shall be fixed taking account, in particular, of the 
need to fix this price at a level which contributes towards stabilizing 
market prices without, however, leading to the formation of structural 
surpluses in the Community." 
(2) Article 5(2) is replaced by the following: 
"For products of standard quality other than pig carcases, buying-in 
prices shall be derived from the buying-in price for pig carcases on 
the basis of the ratio existing between the commercial value of these 
products to the commercial value of pig carcases." 
(3) The following point is added to Article 5(4): 
"(d) fixing the coefficient expressing the ratio referred to in 
paragraph 2." 
(4) Title II is replaced by the following: 
"Title II 
Trade with third countries 
Article 8 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(1) may be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 11 and 13. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 24. 
- 67 -
An 
Article 9 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in 
Article 1(1). 
Article 10 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(1), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
of an additional import duty under the conditions set out in Article 5 
of the Agreement on Agriculture concluded in accordance with 
Article 228 of the Treaty in the framework of the Uruguay Round of 
multilateral trade negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 24. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 11 
Tariff quotas for the products listed in Article 1(1) resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 24. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 12 
Where prices on the Community market rise significantly and where that 
situation is likely to continue, thereby disturbing or threatening to 
disturb that market, appropriate measures may be taken. 
Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 24. 
- 68 -
Article 13 
1. To the extent necessary to enable the products listed in Article 1(1) 
to be exported on the basis of quotations or prices for those products 
on the world market and within the limits resulting from agreements 
concluded in accordance with Article 228 of the Treaty, the difference 
between those quotations or prices and prices in the Community may be 
covered by export refunds. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 24. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. When the amount of the refund is set, account shall be taken in 
particular of the need to establish a balance between the use of 
Community basic agricultural products for export as processed goods to 
third countries, and the use of products from these countries admitted 
for inward processing. 
4. Refunds shall only be granted on application and on presentation of the 
relevant export licence. 
5. The refund applicable to exports of products listed in Article 1(1) 
shall be that applicable on the day of application for the licence and, 
in the case of a differentiated refund, that applicable on the same day 
for the destination indicated on the licence. 
6. Paragraphs 4 and 5 may be waived in the case of products listed in 
Article 1(1) on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 24. 
7. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 24. 
Article 14 
1. To the extent necessary for the proper working of the common 
organization of the market in pigmeat, the use of inward processing 
arrangements may be prohibited in whole or in part in respect of 
products listed in Article 1(1) which are intended for the manufacture 
of products listed in that same paragraph. 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 24. 
- JS -
Article 15 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 16 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(1) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the » 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission sl>all adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 24. 
5. This Article shall be applied having regard to the obligations arising 
.from agreements concluded in accordance with Article 228 of the 
Treaty." 
II. Council Regulation (EEC) No 2764/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.21), as last amended by Regulation (EEC) No 4160/87 (OJ No 
L 392, 31.12.1987, p. 46) 
Council Regulation (EEC) No 2765/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p. 23) 
Council Regulation (EEC)' No 2766/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p. 25), as last amended by Regulation (EEC) No 3906/87 (OJ 
No L 370, 30.12.1987, p. 11) 
- 70 -ÀO'l 
Council Regulation (EEC) No 2768/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p. 39) 
Council Regulation (EEC) No 2769/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p. 43) 
The above Regulations are repealed. 
AQ% - 71 -
ANNEX XI 
POULTRYMEAT 
I. Council Regulation (EEC) No 2777/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.77), as last amended by Regulation (EEC) No 1574/93 
(OJ No L 52, 24.6.1993, p.l). 
(1) Articles 3 to 11 are replaced by the following: 
"Tùrticle 3 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(1) may be subject to presentation of an 
import or export licence. 
Licences shall be issued by tlVe Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 6 and 8. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and pther detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 17. i 
Article 4 
Unless this Regulation pr<5videFs otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in 
Article 1(1) . ri°' ~~'~'' 
Article 5 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(1), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
of an additional import duty under the conditions set out in Article 5 
of the Agreement on Agriculture concluded in accordance with 
Article 228 of the Treaty in the framework of the Uruguay Round of 
multilateral trade negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 17. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
-72- y{Qo 
Article 6 
Tariff quotas for the products listed in Article 1(1) resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 17. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
Article 7 
Where prices on the Community market rise significantly and where that 
situation is likely to continue, thereby disturbing or threatening to 
disturb that market, appropriate measures may be taken. 
Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 17 
Article 8 
1. To the extent necessary to enable the products listed in Article 1(1) 
to be exported on the basis of prices for those products on the world 
market and within the limits resulting from agreements concluded in 
accordance with Article 228 of the Treaty, the difference between those 
prices and prices in the Community ma,y, be_.covered by export refunds. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 17. 
Refunds may be fixed: / 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. When the amount of the refund is set, account shall be taken in 
particular of the need to establish a balance between the use of 
Community basic agricultural products for export as processed goods to 
third countries, and the use of products from those countries admitted 
for inward processing. 
4. Refunds shall only be granted on application and on presentation of the 
relevant export licence. 
- 73 - i 40 
5. The refund applicable to exports of products listed in Article 1(1) 
shall be that applicable on the day of application for the licence and, 
in the case of a differentiated refund, that applicable on the same day 
for the destination indicated on the licence. 
6. Paragraphs 4 and 5 may be waived in the case of products listed in 
Article 1(1) on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 17. 
7. Detailed rules for the applàcafc&on of this Article shall be adopted in 
accordance with the procedure laid down in Article 17. 
Article 9 
To the extent necessary for the proper working of the common organization 
of the market in poultrymeat, the use of inward processing arrangements may 
be prohibited in whole or in part in respect of products listed in 
Article 1 which are intended for the manufacture of products listed in 
Article 1(1). 
Measures adopted pursuant to this Article shall be decided on in accordance 
with the procedure laid down in Article 17. 
Article 10 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
Article 11 
1. If, by reason of an increase in imports or exports, the Community 
•market in one or more of the products listed in Article 1(1) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 17. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance! «yqt h Article 228(2) of the 
Treaty. " = r- .••;..-
(2) Article 12 is deleted. 
II. Council Regulation (EEC) No 2778/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.84), as last amended by Regulation (EEC) No 3714/92 (OJ No 
L 378, 23.12.1992, p.23). 
Council Regulation (EEC) No 2779/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.90). 
Council Regulation (EEC) No 2780/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.94). 
The above Regulations are repealed. 
- 75 - - J A -
ANNEX XII 
EGGS, 
OVALBUMIN AND LACTALBUMIN 
Council Regulation (EEC) No 2771/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.49), as last amended by Regulation (EEC) No 1574/93 
(OJ No L 152, 24.6.1993, p.l). 
(1) Articles 3 to 11 (inclusive) are replaced by the following: 
"Article 3 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(1) shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 6 and 8. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 17. 
Article 4 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1(1). 
Article 5 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(1), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
pf an additional import duty under the conditions set out in Article 5 
of the Agreement on Agriculture concluded in accordance with 
Article 228 of the Treaty in the framework of the Uruguay Round of 
multilateral trade negotiations. 
- 76 - AVi 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 17. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties, may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
* Article 6 
Tariff quotas for the products listed in Article 1(1) resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 17. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
Article 7 
Where prices on the Community market rise significantly and where that 
situation is likely to continue, thereby disturbing or threatening to 
disturb that market, appropriate measures may be taken. 
Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 17. 
Article 8 
1. To the extent necessary to enable the products listed in Article 1(1) 
to be exported without further processing or in the form of goods 
listed in Annex I on the basis of quotations or prices for those 
products on the world market and within the limits resulting from 
agreements concluded in accordance with Article 228 of the Treaty, the 
difference between those quotations or prices and prices in the 
Community may be covered by export refunds. 
- 77 -4-H 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 17. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. • 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. When the amount of the refund is set, account shall be taken in 
particular of the need to establish a balance between the use of basic 
Community agricultural products for export as processed goods to third 
countries, and the use of basic agricultural products from these 
countries admitted for inward processing. 
4. Refunds on products listed in Article 1(1) and exported without further 
processing shall only be granted on application and on presentation of 
the relevant export licence. 
5. The refund applicable to exports of products listed in Article 1(1) 
exported without further processing shall be that applicable on the day 
of application for the licence and, in the case of a differentiated 
refund, that applicable on the same day for the destination indicated 
on the licence. 
6. Paragraphs 4 and 5 may be made to apply to products listed in 
Article 1(1) and exported in the form of goods listed in Annex I in 
accordance with the procedure laid down in Article 16 of Regulation 
(EC) No 3448/93. 
7. Paragraphs 4 and 5 may be waived in the case of products listed in 
Article 1(1) on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 17. 
8. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 17. Annex I shall be 
amended in accordance with the same procedure. 
Article 9 
1. To the extent necessary for the proper working of the common 
organization of the market in eggs, the use of inward processing 
arrangements may be prohibited in whole or in part: 
in respect of products listed in Article 1(1) which are intended for 
the manufacture of products listed in Article 1(1)(b), and 
- in special cases, in respect of products listed in Article 1(1) 
which are intended for the manufacture of goods listed in Annex I. 
78 - * /* ;— 
^ » b . 
2. Measures adopted pursuant to this Article shall be decided on in 
accordance with the procedure laid down in Article 17. 
Article 10 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
Article 11 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(1) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
.Article in accordance with the procedure laid down in Article 17. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
(2) Article 12 is deleted. 
- 79 -A Ab 
II. Council Regulation (EEC) No 2783/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.104), as last amended by Regulation (EEC) No 4001/87 
(OJ No L 377, 31.12.1987, p.44). 
(1) The introductory sentence in Article 1 is replaced by the following: 
"Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the following products:" 
(2) Article 2 is replaced by the following: 
"Article 2 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1 shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Article 4. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 17 of Regulation (EEC) No 2771/75.". 
À a - 80 -
(3) Article 3 is replaced by the following: 
"Article 3 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1, imports of one or more of such products at the rate of duty 
laid down in the common customs tariff may be subject to payment of an 
additional import duty under the conditions set out in Article 5 of the 
Agreement on Agriculture concluded in accordance with Article 228 of 
the Treaty in the framework of the Uruguay Round of multilateral trade 
negotiations. 
2. The Commission shall adopt detailed rules for the application of this . 
Article in accordance with the procedure laid down in Article 17 of 
Regulation (EEC) No 2771/75. Such detailed rules shall specify in 
particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices." 
(4) Article 4 is replaced by the following: 
"Article 4 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed, rules adopted under the procedure 
laid down in Article 17 of Regulation (EEC) No 2771/75. Such detailed rules 
shall provide for annual quotas, suitably phased over the year, to be 
opened and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity." 
-81- A Al 
(5) Article 5 is replaced by the following: 
"Article 5 
Where prices on the Community market rise significantly and where that 
situation is likely to continue, thereby disturbing or threatening to 
disturb that market, appropriate measures may be taken. 
Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 17 of Regulation (EEC) 
No 2771/75." 
(6) Article 7 is replaced by the following: 
"Article 7 
To the extent necessary for the proper working of the common organization 
of the market in eggs and this Regulation, the use of inward processing 
arrangements may be prohibited in whole or in part in respect of products 
listed in Article 1 which are intended for the manufacture of products 
listed in that same Article. 
Measures adopted pursuant to this Article shall be decided on in accordance 
with the procedure laid down in Article 17 of Regulation (EEC) No 2771/75." 
(7) Article 8 is replaced by thé following: 
"Article 8 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect." 
III. Council Regulation (EEC) No 2773/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.64), as last amended by Regulation (EEC) No 4155/87 
(OJ No L 392, 31.12.1987, p.29) 
Council Regulation (EEC) No 2774/75 of 29 October 1975 (OJ No L 282, 
1.11.1975, p.68) 
Council Regulation (EEC) No 2775/75 of 1 October 1975 (OJ No L 282, 
1.11.1975, p.72) 
The above Regulations are repealed. 
/Ml - 82 -
ANNEX XIII 
FRUIT AND VEGETABLES 
Council Regulation (EEC) No 1035/72 of 18 May 1972 (OJ No L 118, 
20.5.1972, p.l), as last amended by Regulation (EC) No 3669/93 
(OJ No L 338, 31.12.1993, p.26) 
Title IV is replaced by the following: 
"Title IV 
Trade with third countries 
Article 22 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(2) shall be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 25 and 26. 
Import and export licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; excep.in cases of force majeure, the 
security shall be forfeited in whole or in part if import or export is 
not carried out, or is only carried out partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 33. 
Article 23 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common Customs tariff shall apply to the products listed in 
Article 1(2). 
2. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 33. Such detailed 
.rules shall cover in particular the measures necessary to check on 
import prices. 
42o 
Article 24 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(2), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
of an additional import duty under the conditions set out in Article 5 
of the Agreement on Agriculture concluded in accordance with 
Article 228 of the Treaty in the framework of the Uruguay Round of 
multilateral trade negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 33. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 25 
Tariff quotas for the products listed in Article 1(2) resulting from 
agreements concluded in accordance with Article 228 of the Treaty or 
from any other act of the Council pursuant to the Treaty shall be 
opened and administered in accordance with detailed rules adopted under 
the procedure laid down in Article 33. Such detailed rules shall 
provide for annual quotas, suitably phased over the year, to be opened 
and, where appropriate, for: 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their 
term of validity. 
/ Article 26 
1. To the extent necessary to enable the products listed in Article 1(2) 
to be exported on the basis of the prices of these products in 
•international trade and within the limits resulting from agreements 
concluded in accordance with Article 228 of the Treaty, the difference 
between those prices and.prices in the Community may be covered by 
export refunds. 
2. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed,in accordance with the procedure laid down in 
Article 33. 
Refunds may be fixed: 
(a) at regular intervals, > ' ' ' ' ' 
(b) by invitation to tender. 
-84- J, £ i 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
3. The refund shall be granted only on request and on presentation of the 
relevant export licence. 
4. The refund applicable to exports of products listed in Article 1(2) 
shall be that applicable on the day of application for the licence and, 
in the case of a differentiated refund, that applicable on the same day 
for the destination indicated on the licence. 
5. Paragraphs 3 and 4 may be waived in the case of products listed in 
Article 1(2) on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 33. 
6. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 33. 
Article 27 
1. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited when importing the 
products listed in Article 1(2) from third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
2. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
Article 28 
1. Appropriate measures may be taken when trading with third countries: 
if, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(2) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 
of the Treaty, 
or if, in the case of the products listed in Annex Ilia, the 
withdrawal or buying-in operations undertaken pursuant to 
Articles 18 and 19 involve significant quantities. 
- 85 - lit 
Such measures may be applied only until, depending on the case, the 
disturbance or threat of disturbance has ceased or the quantities 
withdrawn or bought in have diminished appreciably. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 33. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
- 86 - 423 
II. Council Regulation (EEC) No 2518/69 of 9 December 1969 (OJ No L 318, 
18.12.1969, p.17), as last amended by Regulation (EEC) No 2455/72 
(OJ No L 266, 14.11.1972, p.7) 
Council Regulation (EEC) No 2707/72 of 19 December 1972 (OJ No L 291, 
28.12.1972, p.3) 
Council Regulation (EEC) No 1200/88 of 28 April 1988 (OJ No L 115, 
3.5.1988, p.7), as last amended by Regulation (EEC) No 3821/90 
(OJ No L 366, 29.12.1990, p.45) 
The above Regulations are repealed. 
::r.'.i-;j nil 
" 8? ~ A2-H 
ANNEX XIV 
PROCESSED FRUIT AND VEGETABLES 
I. Council Regulation (EEC) No 426/86 of 24 February 1986 (OJ No L 49, 
27.2.1986, p.l), as last amended by Regulation (EC) No 1490/94 
(OJ No L 161, 29.6.1994, p.13). 
(1) Title II is replaced by èhé'following: 
">noo sri J 
"Title II 
Trade with third countries 
Article 9 
1. Imports into the Community, or exports therefrom, of any of the 
products listed in Article 1(1) may be subject to presentation of an 
import or export licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 12 and 15. 
Import and export licences shall be valid throughout the Community. The 
issue of such licences may be subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence;'"excep.in cases of force majeure, the T erf:* o" security shall be forfeited in whole or in part if import or export is 
not carried out, or is only carried out partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 22. 
Article 10 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in 
Article 1(1). 
2. A minimum import price for the 1995, 1996, 1997, 1998 and 1999 
marketing years shall be fixed for the products listed in Part B of 
Annex I. The minimum import price shall be determined having regard in 
particular to: 
- the free-at-frontier prices on import into the Community, 
- the prices obtaining on world markets, 
- the situation on the internal Community market, 
the trend of trade with third countries. 
Where the minimum import price is not observed, a countervailing charge 
in addition to customs duty shall be imposed, based on the prices of 
the main supplier third countries. 
3. Minimum import prices and other detailed rules for the application of 
this Article shall be adopted in accordance with the procedure provided 
for in Article 22. 
Article 11 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(1), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
of an additional import duty under the conditions set out in Article 5 
of the Agreement on Agriculture concluded in accordance with 
Article 228 of the Treaty in the framework of the Uruguay Round of 
multilateral trade negotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 22. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
Article 12 
Tariff quotas for the products listed in Article 1(2) resulting from 
agreements concluded in accordance with .Article 228 of the Treaty or from 
any other act of the Council pursuant to 'the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 22. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
Article 13 
To the extent necessary to enable the export of: 
(a) the products not containing added sugar listed in Article 1(1), 
- 89 - \Uo 
(b) - white sugar and raw sugar falling within heading 1701, 
- glucose and glucose syrup falling within subheadings 1702 30 51, 
1702 30 59, 1702 30 91, 1702 30 99 and 1702 40 90, 
- isoglucose falling within subheadings 1702 30 10, 1702 40 10, 
1702 60 10 and 1702 90 30, and 
beet and cane syrup.falling within subheading 1702 90 90, 
used in the products listed in Article 1(1)(b), 
on the basis of prices for those products on the world market and 
within the limits resultâligsfrrbm agreements concluded in accordance 
with Article 228 of the Treaty, the difference between those prices and 
prices in the Communityjuta^i^e covered by export refunds. 
Article 14 
1. Refunds shall be the same for the whole Community. They may vary 
according to destination. 
Refunds shall be fixed in accordance with the procedure laid down in 
Article 22. 
Refunds may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular4iintecv>als may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
2. The refund referred to in Article 13(b) shall be equal: 
in the case of raw sugar, white sugar and beet and cane syrup, to 
the amount of refund for export of these products unprocessed as 
fixed in accordance with Article 19 of Council Regulation (EEC) 
No 1785/81 of 30 June 1981 on the common organization of the markets 
in the sugar sector and with the provisions adopted for its 
application, 
- in the case of isoglucose, to the amount of the refund for export 
of this product unprocessed as fixed in accordance with Article 19 
of Regulation (EEC) No 1785/81 and with the provisions adopted for 
its application, 
- in the case of glucose and glucose syrup, to the amount of the 
refund for export of these products unprocessed as fixed for each of 
these products in accordance with Article 16 of Council Regulation 
(EEC) No 1766/92 of 30 June 1992 on the common organization of the 
market in cereals and with the provisions adopted for its 
application. 
- 90 - /J 1 ^ 
3. To qualify for the refund referred to in Article 13(b), the products 
listed in Article 1(1)(b) must, on export, be accompanied by a 
declaration from the applicant indicating the amounts of raw sugar, 
white sugar and beet and cane sugar, isoglucose, glucose and glucose 
syrup used in their manufacture. 
The accuracy of the declaration referred to in the first subparagraph 
shall be subject to checks by the competent authorities of the Member 
State concerned. 
••'....„' i o i 
4. Where the refund referred to in ArtiTcleprl&Kb) is not sufficient to 
permit exports of the products listed in Article 1(1)(b), the 
provisions laid down for the refund refeapired to in Article 13(a) shall 
apply to those products instead of those laid down in Article 13(b). 
5. Refunds shall only be granted on request and on presentation of the 
relevant export licence. 
6. The refund shall be that applicable on the day of application for the 
licence and, in the case of a differentiated refund, that applicable on 
the same day for the destination indicated on the licence. 
7. Paragraphs 5 and 6 may be waived in the case of the refunds referred to 
in Article 13(b) and products listed in Article 1(1) on which refunds 
are paid under food-aid operations, in accordance with the procedure 
laid down in Article 22. 
8. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 22. 
* :0 art! '{-• 
Article 15 
1. To the extent necessary for the proper working of the common 
organizations of the market in cereals, sugar and fruit and vegetables, 
the use of inward processing arrangements may, in special cases, be 
prohibited in whole or in part in respect of: 
products listed in Article 13(b), and 
- fruit and vegetables 
intended for the manufacture of products listed in Article 1(1) 
2. Measures adopted pursuant to this Article shall be decided on in 
•accordance with the procedure laid down in Article 22. 
Article 16 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
- 91 -y, 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited with regard to 
imports from third countries: 
the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
Article 17 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(1) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shalr adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 22. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
- 92 - A^ 
(2) Annexes II, III and IV are deleted. 
II. Council Regulation (EEC) No 518/77 of 14 March 1977 (OJ No L 73, 
21.3.1977, p.22). 
Council Regulation (EEC) No 519/77 of 14 March 1977 (OJ No L 73, 
21.3.1977, p.24). 
Council Regulation (EEC) No 520/77 of 14 March 1977 (OJ No L 73, 
21.3.1977, p.26). 
Council Regulation (EEC) No 521/77 of 14 March 1977 (OJ No L 73, 
21.3.1977, p.28). 
Council Regulation (EEC) No 1796/81 of 30 June 1981 (OJ No L 183, 
4.7.1981), as last amended by Regulation (EEC) No 1122/92 (OJ No L 117, 
1.5.1992, p. 98). 
Council Regulation (EEC) No 2089/85 of 23 July 1985 (OJ No L 197, 
27.7.1985, p. 10). 
Council Regulation (EEC) No 3225/88 of 17 October 1988 (OJ No L 288, 
21.10.1988, p. 11). 
Council Regulation (EEC) No 1201/88 of 28 April 1988 (OJ No L 115, 
3.5.1988, p. 9), as last amended by Regulation (EEC) No 2781/90 (OJ No 
L 265, 28.9.1990, p. 3). 
The above Regulations are repealed. 
- 93 -
13O 
ANNEX XV 
BANANAS 
Council Regulation (EEC) No 404/93 of 13 February 1993 (OJ No L 47, 
25.2.1993, p.l), as last amended by Regulation (EC) No 3518/93 (OJ No L 320, 
22.12.1993, p. 15). 
(1) Article 15 is replaced by the following: 
"Article 15 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in 
Article 1(2). 
2. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain products listed in 
Article 1(2), imports of one or more of such products at the rate of 
duty laid down in the common customs tariff may be subject to payment 
of an additional import duty within the limits set out in Article 5 of 
the Agreement on Agriculture concluded in accordance with Article 228 
of the Treaty in the framework of the Uruguay Round of multilateral 
trade negotiations. 
2. The Commission shall adopt detailed rules for the application of 
paragraph 2 in accordance with the procedure laid down in Article 27. 
Such detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for. triggering the application of paragraph 2 and 
in particular the calculation and determination of the various 
.quantities and prices." 
(2). The following Article is inserted: 
"Article 15a 
Articles 15a to 20 inclusive of this Title shall apply only to fresh 
products falling within CN code ex 0803, excluding plantains. 
For the purposes of this Title: 
1. 'traditional imports from ACP States' means the quantities of bananas 
set out in the Annex exported by each ACP State which has traditionally 
exported bananas to the Community; such bananas shall be referred to as 
'traditional ACP bananas'; 
- 94 - A * . 
A ÎA 
2. 'non-traditional imports from ACP States* means the quantities of 
bananas exported by the ACP States which exceed the quantity defined at 
1 above; such bananas shall be referred to as 'non-traditional ACP 
bananas'; 
3. "imports from non-ACP third countries' means quantities exported by 
other third countries; such bananas shall be referred to as 'third-
country bananas'; 
4. 'Community bananas' means bananas produced in the Community; 
5. 'to market' and 'marketing' mean placing on the market, not including 
making the product available to the final consumer." 
(3) Article 18 is replaced by the following: 
"Article 18 
1. A tariff quota of 2.2 million tonnes (net weight) shall be opened each 
year for imports of third-country bananas and non-traditional ACP 
bananas. 
Within the framework of the tariff quota, imports of third-country 
bananas shall be subject to a levy of ECU 75 per tonne and imports of 
non-traditional ACP bananas shall be subject to a zero duty. 
For 1994, the tariff quota shall be 2.1 million tonnes (net weight). 
Where Community demand determined on the basis of the supply balance 
referred to in Article 16 increases, the volume of the quota shall be 
increased in consequence, in accordance with the procedure laid down in 
Article 27. Any such adjustment shall be made before 30 November 
preceding the marketing year concerned. 
2. By derogation from Article 15(1), non-traditional AÇP bananas imported 
outside the tariff quota referred to in paragraph 1 of this Article 
shall be subject to a customs duty per tonne equal to the duty referred 
to in Article 15(1) less ECU 100. 
3. The quantities of third-country bananas and non-traditional ACP bananas 
re-exported from the Community shall not be charged to the quota 
referred to in paragraph 1. 
4. The amounts referred to in this Article shall be converted into 
national currency at the rate applicable to the products concerned in 
connection with the common customs tariff." 
- 95 - All 
(4) The following indents, are added to Article 20: 
"- measures guaranteeing the provenance and origin of bananas imported 
within the tariff quota provided for in Article 18(1), 
- measures necessary to fulfil obligations arising from agreements 
concluded by the Community in accordance with Article 228 of the 
Treaty." 
(5) Article 23 is replaced by the following: 
"Article 22 
The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application, shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff." 
(6) Article 23 is replaced by the following: 
"Article 23 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely likely to 
jeopardize the achievement of the objectives set out in Article 39 of 
the Treaty, appropriate measures may be taken in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 27. 
5. This Article shall be applied having regard to the obligations arising 
from international agreements concluded in accordance with 
Article 228(2) of the Treaty." 
^1 33 - 96 -
ANNEX XVI 
WINE 
I. Council Regulation (EEC) No 822/87 of 16 March 1987 (OJ No L 84, 
27.3.1987, p.l), as last amended by Regulation (EEC) No 1891/94 
(OJ No L 197, 30.7.1994, p.42). 
(1) Title IV is replaced by the following: 
"Title IV 
Trade with third countries 
Article 52 
1. Imports into the Community of any of the products listed in 
Article 1(2)(a) and (b) shall be subject to presentation of an import 
licence. Imports into the Community of any other products listed in 
Article 1^2) and exports from the Community of any products listed in 
Article 1(2) may be subject to presentation of an export licence. 
2. Licences shall be issued by Member States to any applicant, 
irrespective of his place of establishment in the Community and without 
prejudice to measures taken for the application of Articles 55 and 56. 
Licences shall be valid throughout the Community. 
Such licences shall be issued subject to the lodging of a security 
guaranteeing that the products are imported or exported during the term 
of validity of the licence; the security shall be forfeited in whole or 
in part if import or export is not carried out, or is only carried out 
partially, within that period. 
3. The following shall be adopted in accordance with the procedure laid 
down in Article 83: 
(a) the list of products in respect of which export licences are 
required, 
(b) the term of validity of the licences and other detailed rules 
for the application of this Article. 
- 97 -
Article 53 /Î3</ 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
2. The detailed rules for the application of this Article shall be adopted 
in accordance with the procedure laid down in Article 83. Such detailed 
rules shall include the provisions necessary for the verification of 
import prices. 
Article 54 
1. In order to prevent or counteract adverse effects on the market in the 
Community which may result from imports of certain agricultural 
products, imports of one or more such products at the rate of duty laid 
down in the common customs tariff may be subject to payment of an 
additional import duty under the conditions set out in Article 5 of the 
Agreement on Agriculture concluded in accordance with Article 228 of 
the Treaty in the framework of the Uruguay Round of multilateral trade 
hegotiations. 
2. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 83. Such 
detailed rules shall specify in particular: 
(a) the products to which additional import duties may be applied, 
(b) the criteria for triggering the application of paragraph 1 and 
in particular the calculation and determination of the various 
quantities and prices. 
98 -
Article 55 13s~ 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 83. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
"9-~ 4% 
Article 56 
1. To the extent necessary to enable the export of: 
(a) products listed in Article 1(2), 
(b) sugars falling within Combined Nomenclature code 1701, glucose 
and glucose syrup falling within CN subheadings 1702 30 91, 1702 
30 99, 1702 40 90 and 1702 90 50, including in the form of 
products falling within subheadings 1702 30 51 and 1702 30 59, 
incorporated into the products falling within subheadings 2009 
60 11, 2009 60 71, 2009 60 79 and 2204 30 99, 
on the basis of prices for those products on the world market and 
within the limits resulting from agreements concluded in accordance 
with Article 228 of the Treaty, the difference between those prices and 
prices in the Community may be covered by export refunds. 
2. Refunds shall be the same for the^whole Community. They may vary 
according to destination. 
The refunds referred to in paragraph 1(a) shall be fixed in accordance 
with the procedure laid down in Article 83. They may be fixed: 
(a) at regular intervals, 
(b) by invitation to tender. 
Refunds fixed at regular intervals may, where necessary, be adjusted in 
the intervening period by the Commission at the request of a Member 
State or on its own initiative. 
- 100 - /\ n 1 y\ 
3. The amount of the refund referred to in paragraph 1(b) shall be: 
in the case of raw sugar and white sugar, to the amount of refund 
for export of these products unprocessed as fixed in accordance with 
Article 19 of Council Regulation (EEC) No 1785/81 of 30 June 1981 on 
the common organization of the markets in the sugar sector and with 
the provisions adopted for its application, 
- in the case of glucose and glucose syrup, to the amount of the 
refund for export of these products unprocessed as fixed for each of 
these products in accordance with Article 17 of Council Regulation 
(EEC) No 1766/92 of 30 June 1992 on the common organization of the 
market in cereals and with the provisions adopted for its 
application. 
4. To qualify for the refund referred to in paragraph 1(b), processed 
products must, on export, be accompanied by a declaration from the 
applicant indicating the amounts of raw sugar, white sugar, glucose and 
glucose syrup used in their manufacture. 
The accuracy of this declaration shall be subject to checks by the 
competent authorities of the Member State concerned. 
5. Refunds shall only be granted on application and on presentation of the 
relevant export licence. 
6. The refund applicable to exports of products listed in Article 1 shall 
be that applicable on the day of application for the licence and, in 
the case of a differentiated refund, that applicable on the same day 
for the destination indicated on the licence. 
7. Paragraphs 4 and 5 may be waived in the case of products listed in 
Article 1 on which refunds are paid under food-aid operations, in 
accordance with the procedure laid down in Article 83. 
8. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 83. 
Article 57 
1. To the extent necessary for the proper working of the common 
organization of the market in wine the use of inward processing 
arrangements may be prohibited .wholly or partially in respect of all or 
some of the products listed in Article 1(2). 
2. The measures taken pursuant to this Article shall be adopted in 
accordance with the procedure laid down in Article 83. 
- 101 - „ ^ ,-
Article 58 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited: 
the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 59 
1. The import of the products referred to in Article 1.(2) to which alcohol 
has been added, with the exception of those products equivalent to 
products originating in the Community in respect of which such an 
admixture is permitted p-ujr^uant to Article 25(1) and (2), shall be 
prohibited. , ,: .., 
2. Detailed rules for the application of this Article, and in particular 
the conditions for the equivalence of products, shall be adopted in 
accordance with the procedure laid down in Article 83. 
Article 60 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1(2) is 
affected by, or is threatened with, serious disturbance likely to 
jeopardize the achievement of the objectives set out in Article 39 of t 
the Treaty, appropriate measures may be applied in trade with third 
countries until such disturbance or threat of disturbance has ceased. 
In order to assess whether the situation justifies the application of 
such measures, the following must be taken into account: 
(a) the quantities in respect of which import licences have been 
issued or applied for and the figures given in the forecast 
supply balance; 
(b) where appropriate, the scale of the intervention. 
- 102 AZ°i 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 83. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty. 
Article 61 
1. Imported wine intended for direct human consumption and described with 
the aid of a geographical ascription^hta^iie~ eligible, with regard to 
its marketing in the Community and with the proviso that reciprocity 
exists, for the control and protection arrangements referred to in 
Article 16 of Regulation (EEC) No 823/87-i fcir quality wines produced in 
specified regions. 
2. The provision laid down in paragraph 1 shall be implemented by means of 
agreements with interested third countries to be negotiated and 
concluded in accordance with the procedure laid down in Article 113 of 
the Treaty. 
3. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 83." 
(2) The following is inserted after Article 72: 
"Article 72a 
1. The Member States shall take all necessary measures to enable 
interested parties to prevent, on the terms stipulated in Articles 23 
and 24 of the Agreement on Tirade-related Aspects of Intellectual 
Property Rights, the use in the Community of a geographical indication 
attached to the products referred to in Article 1(2)(b) for products 
not originating in the place indicated by the geographical indication 
in question, even where the true origin of the goods is indicated or 
the geographical indication is used in translation or accompanied by 
expressions such as "kind", "type", "style", "imitation" or the like. 
For the purposes of this Article, "geographical indications" is taken 
to, mean indications which identify a product as originating in the 
territory of a third country which is a member of the World Trade 
Organization or in a region or locality within that territory, in cases 
where a certain quality, reputation or other given characteristic of 
the product may be attributed essentially to that geographic place of 
origin. 
2. Paragraph 1 shall apply notwithstanding other specific provisions in 
Community legislation laying down rules for the designation and 
- 103 - , , 
presentation of the products referred to in Article 1(2)(b). 
3. Detailed rules for the application of this Article shall be adopted in 
accordance with the procedure laid down in Article 83." 
(3) Annex VII is deleted. 
- 104 >H1 
II. Council Regulation (EEC) No 344/79 of 5 February 1979 (OJ No L 54, 
5.3.1979, p.67) 
Council Regulation (EEC) No 345/79 of 5 February 1979 (OJ No L 54, 
5.3.1979, p.69), as amended by Regulation (EEC) No 2009/81 
(OJ No L 195, 18.7.1981, p.6) 
The above Regulations are repealed. 
AHl - 105 -
ANNEX XVII 
TOBACCO 
Council Regulation (EEC) No 2075/92 of 30 June 1992 (OJ No L 215, 30.7.1992, 
p.70) 
Title IV is replaced by the following: 
"Title IV 
Trade with third countries 
Article 15 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1. 
Article 16 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council!qataisiEant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 23. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their terra of 
validity. 
Article 16a 
» -
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation. -
/jH1 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
(a) the levying of any charge having equivalent effect to a customs 
duty, 
(b) the application of any quantitative restriction or measure 
having equivalent effect. 
Article 16c 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be imraadabafcply applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days! following receipt of the 
request. -v-:.-+ 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 23. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
A H 4 - 107 -• 
, ANNEX XVIII 
HOPS 
Council Regulation (EEC) No 1696/71 of 26 July 1971 (OJ No L 175, 4.8.1971, 
p.l), as last amended by Regulation (EEC) No 3124/92 (OJ No L 313, 
30.10.1992, p.l) 
Title V is replaced by the following: 
"Title V 
Trade with third countries 
Article 14 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1. 
Article 15 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 20. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
108 - ^-K 
Article 15a 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited: 
the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure 
having equivalent effect. 
Article 15c 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States'shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 20. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
- 109 - A H(n 
ANNEX XIX 
LIVE TREES AND OTHER PLANTS, BULBS, ROOTS AND THE LIKE, 
CUT FLOWERS AND ORNAMENTAL FOLIAGE 
I. Council Regulation (EEC). No 234/68 of 27 February 1968 (OJ No L 55, 
2.3.1968, p.l), as last amended by Regulation (EEC) No 3336/92 
(OJ No L 336, 20.11.1992, p.l). 
Articles 8, 9 and 10 are replaced by the following: 
"Article 8 
1. Imports into the Community of any of the products listed in Article 1 
may be subject to presentation of an import licence. 
Licences shall be issued by the Member States to any applicant, 
irrespective of his place of establishment in the Community. 
Import licences shall be valid throughout the Community. Such licences 
shall be issued subject to the lodging of a security guaranteeing that 
the products are imported during the term of validity of the licence; 
the security shall be forfeited in whole or in part if import is not 
carried out, or. is only carried out partially, within that period. 
2. The term of validity of licences and other detailed rules for the 
application of this Article shall be adopted in accordance with the 
procedure laid down in Article 14. 
i Article 9 
Unless this Regulation provides otherwise, the rates of duty in the common 
customs tariff shall apply to the products listed in Article 1. 
Article 10 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 14, Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
- 110 - AHl 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
Article 10a 
1. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the tariff 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
2. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with 
third countries: 
the levying of any charge having equivalent effect to a customs 
duty, 
the application of any quantitative restriction or measure having 
equivalent effect. 
Article 10b 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by ' 
a qualified majority, amend or annul the measure in question. 
Ill - n 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 14. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
II. Council Regulation (EEC) No 3290/75 of 16 December 1975 (OJ No L 326, 
18.12.1975, p.4). 
The above Regulation is repealed. 
- 112 - AH °) 
ANNEX XX 
SEEDS 
I. Council Regulation (EEC) No 2358/71 of 26 October 1971 (OJ No L 246, 
5.11.1971, p.l), as last amended by Regulation (EC) No 3375/93 (OJ No 
L 303, 10.12.1993, p.9). 
(1) Articles 5, 6 and 7 are replaced by the following: 
"Article 5 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in Article 1. 
2. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall be 
incorporated in the common customs tariff. 
Article 6 
Tariff quotas for the products listed in Article 1 resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the procedure 
laid down in Article 11. Such detailed rules shall provide for annual 
quotas, suitably phased over the year, to be opened and, where appropriate, 
for: 
(a) guarantees covering the nature, provenance and origin of the product, 
(b) recognition of the document used for verifying the guarantees referred 
to in (a), and 
(c) the conditions under which import licences are issued and their term of 
validity. 
- 113 -
Article 7 ACQ 
Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, the following shall be prohibited in trade with third 
countries: 
- the levying of any charge having equivalent effect to a customs duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 7a 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in Article 1 is affected 
by, or is threatened with, serious disturbance likely to jeopardize the 
achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries until 
such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member. State or on its own initiative, 
decide upon the necessary measures; the Member States shall be notified 
of such measures, which shall be immediately applicable. If the 
Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 11. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
(2) Article 8a is deleted. 
II. Council Regulation (EEC) No 1578/72 of 20 July 1972 (OJ No L 168, 
.26.7.1972, p.l), as amended by Regulation (EEC) No 1984/86 
(OJ No L 171, 28.6.1986, p.3). 
The above Regulation is repealed. 
4&L 
ANNEX XXI 
MISCELLANEOUS REGULATIONS 
I. Council Regulation (EEC) No 827/68 of 28 June 1968 (OJ No L 151, 
30.6.1968, p.16), as last amended by Regulation (EEC) No 794/94 
(OJ No L 92, 9.4.1994, p.15). 
(1) Articles 2 and 3 are replaced by the following: 
"Article 2 
1. Unless this Regulation provides otherwise, the rates of duty in the 
common customs tariff shall apply to the products listed in the Annex. 
2. The general rules for the interpretation of the Combined Nomenclature 
and the special rules for its application shall apply to the 
classification of products covered by this Regulation; the tariff 
nomenclature resulting from the application of this Regulation shall 
be incorporated in the common customs tariff. 
3. Save as otherwise provided for in this Regulation or pursuant to a 
provision thereof, and subject to the obligations arising from 
international agreements concerning the products listed in the Annex, 
the following shall be prohibited in trade with third countries: 
- the levying of any charge having equivalent effect to a customs 
duty, 
- the application of any quantitative restriction or measure having 
equivalent effect. 
Article 3 
Tariff quotas for the products listed in the Annex resulting from 
agreements concluded in accordance with Article 228 of the Treaty or from 
any other act of the Council pursuant to the Treaty shall be opened and 
administered in accordance with detailed rules adopted under the 
procedure laid down in Article 14. Such detailed rules shall provide for 
annual quotas, suitably phased over the year, to be opened and, where 
appropriate, for: 
AS su 
(a) guarantees covering the nature, provenance and origin of the 
product, 
(b) recognition of the document used for verifying the guarantees 
referred to in (a), and 
(c) the conditions under which import licences are issued and their term 
of validity. 
Article 3a 
1. If, by reason of an increase in imports or exports, the Community 
market in one or more of the products listed in the Annex is affected 
by, or is threatened with, serious disturbance likely to jeopardize 
the achievement of the objectives set out in Article 39 of the Treaty, 
appropriate measures may be applied in trade with third countries 
until such disturbance or threat of disturbance has ceased. 
2. If the situation referred to in paragraph 1 arises, the Commission 
shall, at the request of a Member State or on its own initiative, 
decide upon the necessary measures; the Member States shall be 
notified of such measures, which shall be immediately applicable. If 
the Commission receives a request from a Member State, it shall take a 
decision thereon within three working days following receipt of the 
request. 
3. Measures decided upon by the Commission may be referred to the Council 
by any Member State within three working days of the day on which they 
were notified. The Council shall meet without delay. It may, acting by 
a qualified majority, amend or annul the measure in question. 
4. The Commission shall adopt detailed rules for the application of this 
Article in accordance with the procedure laid down in Article 6. 
5. This Article shall be applied having regard to the obligations arising 
from agreements concluded in accordance with Article 228(2) of the 
Treaty." 
(2) Article 6 is replaced by the following: 
"Article 6 
Where reference is made to this Article, mesures shall be adopted in 
accordance with the procedures laid down in Article 38 of Regulation 
No 136/66/EEC and the corresponding articles of the other regulations on 
the common organizations of agricultural markets." 
II. Council Regulation (EEC) No 234/79 of 5 February 1979 (OJ No L 34, 
9.2.1979, p.2), as last amended by Regulation (EEC) No 3209/89 
(OJ No L 312, 27.10.1989, p.5). 
Article 2(2) is deleted. 
^S"f - 117 -
ANNEX XXII 
THE MOST REMOTE REGIONS 
I. Council Regulation (EEC) No 3763/91 of 16 December 1991 (OJ No L 356, 
24.12.1991, p.l), as amended by Regulation (EEC) No 3714/92 (OJ No 
L 378, 23.12.1992, p.23). 
Article 2(2) is amended as follows: 
(a) In the first subparagraph, the part of the sentence which reads: 
"The levies fixed pursuant to Article 13(1) of Council 
Regulation (EEC) No 2727/75 of 29 October 1975 on the common 
organization of the market in cereals" is replaced by: 
"The import duties provided for in the common customs tariff". 
(b) In the second subparagraph, the words "the levy (exemption)" are 
replaced by "(exemption from) import duty". 
II. Council Regulation (EEC) No 1600/92 of 15 June 1992 (OJ No L 173, 
27.6.1992, p.l), as amended by Regulation (EEC) No 3714/92 (OJ No 
L 378, 23.12.1992, p.23). 
(1) In Article 3(1), the words "Levies and/or" are deleted. 
(2) In Article 5(1)(a), the words "and/or levies referred to in Article 9 
of Council Regulation (EEC) No 805/68 on the common organization of the 
market in beef and veal" are deleted. 
III. Council Regulation (EEC) No 1601/92 of 15 June 1992 (OJ No L 173, 
27.6.1992, p.13), as amended by Regulation (EEC) No 3714/92 (OJ No L 
378, 23.12.1992, p.23). 
(1) In Article 3(1), the words "Levies and/or" are deleted. 
(2) In Article 5(1)(a), the words "and/or levies referred to in Article 9 
of Council Regulation (EEC) No 805/68" are deleted. 
- 118 -
ANNEX XXIII 
PLANT HEALTH LEGISLATION 
Council Directive 77/93/EEC of 21 December 1977 (OJ No L 26, 31.1.1977, 
p.20), as last amended by Directive 94/13/EC (OJ No L 92, 9.4.1994, p.27). 
In Article 14(1), the introductory part of the first subparagraph is 
replaced by the following: 
"In accordance with the procedure laid down in Article 16 or, in cases of 
emergency, in accordance with that laid down in Article 17, provision shall 
be made for derogations:". 
.4 re-
Part 6 
Commercial defence 
-'M 
Commercial defence: 
Anti-dumping 
As? 
Proposal for a 
Council Regulation (EC) 
on protection against dumped imports from countries not members of the European Community 
-"•- ?Mm 9b 
Aï °) 
Explanatory Memorandum 
A. Introduction 
The Uruguay Round trade negotiations, concluded in 1994, have led to a new agreement on anti-dumping 
which requires to be implemented into Community legislation in order that, as agreed at Marrakech, it can 
come into effect on 1 January 1995. 
The new Agreement, namely, the Agreement on Implementation of Article VI of the General Agreement 
on Tariffs and Trade 1994 (the Agreement), contains new arid detailed rules on almost every aspect of anti­
dumping and in view of the extent of the changes and to ensure an adequate and transparent 
implementation of the new rules, it is considered necessary to transpose the language of the Agreement 
into Community legislation to the extent possible and for this purpose the Agreement, rather than the 
existing Community legislation, Regulation (EC) No 2423/88*, has been taken as the basis for the 
proposed legislation. 
Additions to the Agreement are few and they have, for the most part, been restricted to: clarifications 
where the Agreement is unclear; incorporation of existing provisions on EU's rather unique procedures and 
decision-making, amended to take account of Court judgements; and the amendment or incorporation of 
EU specific rules on issues, such as negligible import volumes, absorption, circumvention and Community 
interest, on which the Agreement is silent, imprecise or where it merely gives an indication of minima. 
The Agreement sets tougher standards for the imposition of anti-dumping measures with its new and 
detailed rules on the calculation of dumping, its increased procedural requirements for initiation and 
subsequent investigation, its restrictions on the imposition of provisional duties and the restriction on the 
application of duty absorption rules. Its implementation into Community legislation will, of course, 
produce the same result. 
Moreover, the adoption of these new rules, would at the same time, achieve one of the key objectives set 
by the Community at the outset of these negotiations, i.e., to improve legal certainty through greater 
precision, to extend transparency and to increase the right of parties. 
In the same vein, some of the new rules, such as on negligible import volumes and Community interest, 
should further reinforce this effect of transparency and legal certainty. Community industries would have a 
clear idea of the minimum level of import volumes required both for complaints and final action. 
Moreover, all interested parties would be made aware of their rights and obligations with regard to the 
Community interest aspects of these cases, in that a structured framework would be provided for the 
provision and treatment of information by the authorities. 
Another key objective in the Uruguay round negotiations was that measures, once taken, should be more 
effectively enforced and the suggested amendments on retroactivity, absorption and circumvention are 
aimed at achieving this objective. In this regard, it should be noted that these enforcement provisions are 
not new concepts since they are specifically provided for in existing EU legislation and the amendments 
proposed are simply to make them more workable and/or more compatible with GATT rules. 
It should be noted that the proposed text does not include rules on subsidies as this matter shall be dealt 
with in a separate proposal. 
OJ No L 209,2.9.1988, p.l 
Aùa 
B. The main changes 
This section details the main areas where the transposition of the text of the Agreement into Community 
legislation involves changes or clarifications to that text. 
1. Start-up costs 
a) The problem 
This new Code ( Article 2.2.1.1) provides for an allowance for the exporter in a start-up situation which, 
unfortunately, it does not define, e.g. it does not give any guidance on whether start-up refers to a new 
product or a new factory, or both, or give any guidance with regard to the length of the start-up phase. In 
considering this problem, it has to be borne in mind that the Agreement already provides for costs, be they 
high or low, to be allocated in accordance with normal accounting principles, which means that, even 
without a specific start-up allowance, high start-up costs would still be allocated over a reasonable number 
of years. Therefore, the situation for which an adjustment has to be made is the low production volume 
which may prevail during start-up and which may give rise to abnormally high unit costs. 
b) The solution 
As can be seen in Article 2.5.2 of the proposal, the existence of a start-up situation can be defined 
relatively easily by providing for it to include all situations where there is significant investment and new 
production facilities and this would cover both new products or new factories. 
However, it is a lot more difficult to define the length of a start-up period. Consideration has been given to 
specifying a normal sales quantity or setting a precise duration for the length of a start-up phase, e.g. 6 
months. Such specific definitions would, however, be controversial and could take no account of 
differences between products and industries. It also has to be borne in mind that the rules on start-up 
cannot be defined in isolation from the other Code rules and, in this respect, account has to be taken of the 
fact that the Agreement states that the normal period for cost recovery for a product is 12 months. 
Logically, therefore, a start-up phase can only constitute a part of that period of cost recovery and this is 
made clear in the proposed text. While the above suggestion leaves a certain imprecision, the alternatives 
are even less palatable. Moreover, it would permit some flexibility to cater for situations which differ from 
product to product and industry to industry. 
2. Normal value for non-market economy countries 
a) The problem 
The problem here is that with the introduction of time limits, it may not always be possible, in the 
restricted time available, to find a suitable market economy analogue country which is willing to 
cooperate. Under the wording of the existing legislation, such circumstances would require the use of 
Community prices and costs, a situation which should be avoided except in exceptional circumstances. 
Consequently, provision has to be made to permit the use of other reasonable methods in such situations. 
Moreover, as the choice of analogue country is sometimes a matter of controversy, the proposal provides 
for the exporters to be consulted before a final selection is made. 
b) The solution 
In Article 2.7 of the proposed text, provision is made for normal value to be based "on any reasonable 
basis" and this would permit the application of methods other than Community prices and costs. 
At the same time, the proposed text would require that exporters are given 10 days to comment on the 
choice of analogue country. Also, mention is made of time limits and, for the choice of analogue country, 
preference may be given to a country subject to the same investigation though it would, of course, have to 
fulfil the "reasonable" criteria. 
AUl 
3. Fair comparison 
a) The problem 
In existing Community legislation, level of trade is dealt with under the section dealing with the 
establishment of prices (Article 2.3), rather than under fair comparison as is the case in the Agreement. 
Moreover, as "quantities" are also dealt with in the Agreement under "fair comparison" it is difficult for the 
EU to continue to deal with the related factors, namely discounts and rebates, under the above-mentioned 
Article 2.3. 
b) The solution 
In order to keep strict consistency with the Agreement it is proposed to cater for level of trade under the 
heading "fair comparison" (Article 2.10) in the draft text. In the same manner, it appears necessary to treat 
discounts and rebates, alongside quantities, under the same heading. 
Furthermore, with the new emphasis on level of trade adjustments, it is no longer rational to grant an 
adjustment for a fixed overhead like salesmen salaries outside the context of a level of trade adjustment. It 
is, therefore, proposed to give this adjustment under level of trade, in accordance with the Agreement. 
4. Conclusion of investigations 
a) The problem 
The Agreement (Article 5.10) provides that investigations should normally be concluded within 12 months 
which conflicts with the 15 months which is envisaged for EU investigations next year 
b) The solution 
It is proposed to incorporate the provisions of the Agreement into EU legislation (Article 6.9). This shall 
permit complex cases to be completed in 18 months as set out in the Agreement but, of course, provisional 
duties would still have to be applied within 9 months. 
5. Violation or withdrawal of undertakings 
a) The problem 
Over the years, there have been continual problems on what to do in cases where exporters have violated 
or withdrawn undertakings. In such circumstances, it is considered that the Community should be entitled 
to impose definitive duties based on the findings of the previous investigation, otherwise an exporter which 
is violating its undertaking could end up in a more advantageous position than its rivals which may be 
faithfully applying the undertakings. Moreover, carrying out a completely new investigation based on new 
facts is a time-consuming affair which should only be carried where the circumstances justify it. Violation 
does not appear to be one of these circumstances. 
b) The solution 
The new provisions set out in article 8.9 and 8.10 of the draft text would permit the imposition of definitive 
duties in cases of proven violation or withdrawal though, of course, the exporter's rights would be 
safeguarded in that he would be entitled to a ask for a review if the circumstances with regard to dumping 
or injury have changed. Moreover, the change in measures would not generate a new 5 year "sunset" 
period. Where violation is only suspected, the remedy is a provisional duty while the matter is under 
investigation. 
dd'x 
6. Negligible volume of imports 
a) The problem 
The Agreement ( Article 5.8 ) fixes negligible import volumes below which action could not normally be 
taken, i.e., where the dumped imports are less than 3% of total imports and where those less than 3% 
collectively account for more than 7%. These minima are set in relation to volume of imports rather than 
in relation to consumption which is the usual Commumty practice. 
b) The solution 
Simply to transpose the Agreement provision into EU legislation 
7. Retroactivity 
a) The problem 
The retroactivity provisions in the Agreement (Article 10.4) need to be defined to deal with situations 
where importers, in order to avoid the impact of provisional duties, import a substantial quantity just prior 
to the imposition of such duties. The Agreement requires the investigating authority to show a "history of 
dumping" or "awareness" of dumping and "massive" imports before action can be taken. This problem 
also exists in the existing Code but because of the imprecise nature of these terms, and the fact that 
customs have had no means of imposing duties retroactively because the goods were not marked on entry, 
it was not possible to use the provisions. 
b) The solution 
It is proposed (Article 10.4 of proposal) that a history of dumping could be considered to be established 
where it has been taking place over an extended period and "awareness" would be established where the 
margins alleged or found are high. The requirement "massive" would be achieved where, in addition to 
the level of the dumped imports during the investigation period, there was a further substantial increase in 
imports just prior to the imposition of provisional duties. Thus, both combined would satisfy the 
requirement of the term "massive" in the Agreement. 
8. Refund of anti-dumping duties 
a) The problem 
The Community's calculations for refund claims, concerning importers which are related to exporters, have 
to be changed to reflect the Agreement provisions on "duty as a cost" as set out in its Article 9.3.3. 
To grasp the full implications of the change it should be recalled that, in any dumping calculation, export 
prices between related parties are deemed to be unreliable because of the relationship. Thus, it is necessary 
to re-construct a reliable export price and this is done by taking the first independent price charged by the 
related importer in the Community and deducting from it the costs and profit of the related importer, a 
process which gives a reliable Community frontier export price. 
The implications of the above for related importers in refund claims is that, as clearly specified in existing 
EU legislation, an anti-dumping duty is one of the costs which must be deducted to arrive at a reliable 
export price and, therefore, a related importer has to do more than just reflect the cost of the duty in its 
resale price to obtain a refund. It would also, for example, have to reduce normal values or in fact increase 
its resale prices by more than the level of the duty. This is equivalent to the treatment given to independent 
importers, who need to do more than just pay the duty before they can obtain a refund. 
The Agreement, however, restricts the application of "duty as a cost" by stating that this principle cannot -• 
apply where resale prices and subsequent selling prices in the Community have increased to reflect the cost 
of the duty. 
b) The solution 
The simple solution is to incorporate the Agreement provision into Community legislation. The Agreement 
provision has been added at the end of Article 11 in the proposed text so that the restrictions placed on its 
use by GATT would be extended to all cases where export prices may have to be reconstructed, e.g. in 
reviews. 
9. Absorption of anti-dumping duties 
a) The problem 
The existing Community legislation (Article 13.11) has provisions to deal with cases where duties do not 
have any price effects on the goods subject to measures. These provisions have been criticised because 
they appear to permit the imposition of additional duties because duties have not led to price increases and 
without a new calculation of dumping being made. In fact, their underlying rationale is that the lack of a 
price increase must mean that the exporter is bearing the cost of the duty, an occurrence which 
automatically increases the margin of dumping. 
b) The solution 
The draft text includes a radical re-draft in Article 12 of the absorption provisions and they now 
specifically require a re-assessment of export prices and a new calculation of dumping margins, where 
measures have had no impact on the prices of the goods subject to duty. In contrast to the existing 
provisions they also permit an investigation to take account of changes in the normal values where 
evidence of this is produced by the exporter. 
In common with the refund provisions, duties cannot, in contrast to the position now, be treated as a cost 
incurred between importation and resale in cases of a re-construction of export prices, where measures 
have impacted on prices or where there is legitimate reason why prices have not increased following the 
measures. 
The new provisions may be slightly less wide-ranging than those set out in Article 13.11 of existing 
legislation but they can now be considered safe in that they are compatible with GATT. 
10. Circumvention 
a) The problem 
Circumvention can occur in several forms ranging from assembly operations, in the importing country or 
in third countries, to more direct instances of duty avoidance, such as wrong origin declarations, imports of 
knockdown kits and slightly altered products, etc. The Community has encountered all these forms of 
circumvention in the recent past, e.g. cameras, bicycles and compact discs and, as such, there appears to be 
an immediate problem which requires attention. 
At present, however, our existing circumvention legislation (Article 13.10), which only deals with 
assembly operations in the Community, has been criticised by a GATT panel. Moreover, origin rules are 
proving increasingly inadequate to deal even with cases of blatant circumvention, such as is apparently 
occurring, or has occurred, in the above-mentioned cases. Also, the result of the Uruguay does not give any 
guidance. Negotiations in this area failed and there is nothing in the Agreement, though Marrakech 
produced a Ministerial Declaration on this subject which appears, for the first time, to permit individual 
Members to deal with problem unilaterally, pending a multilateral solution via 
the GATT Anti-Dumping Committee. In this respect, the Community has always made it clear that its 
acceptance of the above-mentioned panel report was conditional on a satisfactory solution in the Uruguay 
Round, a condition that has not been realised. 
b) The solution 
New circumvention provisions are set out in Article 13 of the proposal. The classic circumvention 
provisions, i.e. assembly in the importing country or a third country, are to the degree possible, modelled 
on the importing country provision set out in the "Dunkel Draft" of December 1991, which was later 
dropped in the last days of the negotiations in December 1993, while the rules set out for other forms of 
circumvention have been inspired by concepts set out in customs law. 
(i) Classic circumvention 
The proposal maintains the existing Community rules on the percentage of parts which must 
originate in the exporting country before action can be taken, i.e. at least 60% as compared to 
70% in the Dunkel Draft. These levels equate to those set out in Community legislation and there 
seems little reason to change them as they have proved workable for all parties concerned when 
they have been applied. Moreover, it would be unwise to lower the percentages given that this 
would undermine the EU's negotiating position in Geneva, when the problem of circumvention 
comes up for negotiation. 
Some of the more burdensome and, in some cases, illogical conditions contained in the Dunkel 
Draft, including an additional dumping test, have been omitted. The aim is to combat the 
circumvention of existing measures quickly and not to carry out lengthy de novo investigations of 
dumping and injury. However, the proposal maintains the "Dunkel" provision that measures may 
only be extended where their remedial effects are being undermined and this will ensure that these 
provisions are only used in truly deserving cases. 
(ii) Other forms of circumvention 
The proposed draft would also permit action to be taken against other forms of circumvention 
which, nowadays, are probably more important than classic circumvention in terms of 
undermining measures. This would allow quick investigation of changes in the pattern of trade 
which coincide with anti-dumping investigations, to check whether such practices have been set 
up to circumvent measures. In the same way as for classic circumvention, an injury test would be 
undertaken and no measures could be applied unless it was shown that the remedial effects of the 
measures were being undermined. This is a very important restriction which would limit the use 
of this provision. 
The provisions may appear wide-ranging, in that investigations can be opened following distinct 
changes in the pattern of trade which coincide with anti-dumping action. It should be noted, 
however, that measures could only be imposed under narrowly defined circumstances, with the 
underlying rationale stemming from the Customs Code, which does not grant legal recognition to 
acts whose only economic justification is to avoid payment of duties. It could be argued that these 
problems should be dealt with by customs authorities but this would not be practical or effective 
for three reasons; 
(i) customs do not appear to have the means, or the necessary legal provisions, to carry these 
investigations, certainly not as quickly as would be necessary; (ii) the circumvention provisions 
would need to cover undertakings which are outside the remit of customs; and most, importantly 
(iii) these provisions require injury investigations to be carried out and this can only be done by 
the anti-dumping services of the Commission. 
Provisions to deal with these other forms of circumvention are important for another reason. They 
are almost always practised via third countries and, unless effective measures are taken to deal 
with them, there will always be an incentive for investment to go to these other third countries 
rather than the Community. 
(iii) How these provisions will operate in practice 
A circumvention investigation can only be opened following receipt of a complaint by the 
Community industry and appraisement would be withheld, or imports would be registered, 
pending the outcome of the investigation which would be completed within a time limit of 9 
months. 
The withholding of appraisement, or registration of imports, which is a mechanism under which 
neither cash deposits or guaranties are collected but the imports are recorded, is necessary in order 
to be able to impose and collect duties at the Community frontier, in accordance with the panel 
report, should circumvention be found. 
The proposals have been deliberately left open with regard to certain aspects of product coverage, 
both for initiation and the imposition of measures as it considered that questions relating to 
product or country coverage can only be addressed on a case-by-case basis. In any event, once a 
circumvention investigation is initiated, the proposal envisages a flexible certificate system under 
which certain products, parts or exporters could be exempted from the scope of the investigation, 
from the moment it becomes clear that they should be so exempted. These certificates could easily 
be obtained by traders from the authorities in order to avoid payment of duties. In fact, this type 
of certificate system is not new to customs as they operate them in other areas and they are 
considered indispensable here to be able to comply with the findings of the GATT panel. 
y\bk; 
11. Suspension of anti-dumping measures 
a) The problem 
There are times during the application of measures where market conditions may indicate that such 
measures are temporarily inappropriate, yet at the moment there is no way of dealing with this problem 
short of lifting the measures altogether, and this is something that cannot easily be done at present if it is 
suspected that the lack of injury is only temporary. 
b) The solution 
Provide specifically for such an eventuality in the legislation and this is done in its Article 14.4. The ability 
to place measures in suspension, which would only take place after consultation of the Community 
industry, would be of great value and would mean that duties are only collected where necessary. The 
suspension would be fora limited period and measures could be re-instated swiftly should the need arise. 
12. Withholding of appraisement (Registration of imports) 
a) The problem 
This concept of withholding of appraisement is one of the important innovations introduced by the 
Agreement in its Article 7. It is a mechanism under which imports would not be subject to either cash 
deposit or guarantee but they would be recorded by customs until a decision was taken on the matter which 
led to such withholding, e.g. investigations for new exporters, retroactivity and circumvention. The 
mechanics of the system would be identical to those used for provisional measures, except that importers 
would be in a better position because they would not pay cash or have to give guarantees on importation. 
Customs may well have some reservations about not being able to require guarantees but that is not a 
sufficient reason not to apply a concept which is now firmly embedded in the Agreement and which is 
considered absolutely essential for circumvention. 
b) The solution 
The solution is simple and it is to cater for a system of withholding of appraisement as set out in Article 
14.5 of the proposal. Note that the term "withholding of appraisement" has been substituted by the more 
understandable term "registration of imports" in the text. 
13. Community interest 
The proposal contains an Article 21 which would formalise the way in which the Community interest is to 
be taken into account in anti-dumping investigations. This would have the advantage that it would permit 
the examination of this aspect to be carried out within a structured framework which is considered to be 
absolutely essential when time limits come into operation. 
Paragraph 1 of the above-mentioned Article sets out the principles relating to Community interest and an 
attempt has been made to highlight the two basic interests which have to be taken into account, i.e. the 
need, on the one hand, to eliminate injurious dumping and restore effective competition and, on the other 
hand, to grant certain rights to users and consumers. This will, for the first time, give users and consumers 
a comprehensive set of rights, under which they will be entitled to provide information, to see information 
provided by other parties and to comment on it, to haye their information taken into account and presented 
to Member States, and to have proper disclosure rights for both provisional and definitive measures. 
However, when rights are obtained, obligations inevitably also arise and these are inherent in the time 
limits within which all parties have to work and in the fact that information presented has to be 
substantiated to a sufficient degree. 
C. Conclusion 
In order to implement the 1994 Anti-Dumping agreement as concluded as a result of the Uruguay Round 
of multilateral trade negotiations, and to take account of the issues set out in section B above, the 
Commission submits to the Council. 
a proposal to replace the Community's basic anti-dumping legislation. 
10 
Proposal for implementation of Uruguay Round results 
on Anti-Dumping 
Regulation /uy 
[Underlining indicates text which differs from new Agreement or existing legislation] 
A^5 
Council Regulation (EC) No 94/ o2ao(ACO 
on protection against dumped imports from countries not members of the European 
Community 
The Council of the European Union, 
Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, 
Having regard to the Regulations establishing the common organisation of agricultural markets and the 
Regulations adopted under Article 235 of the Treaty applicable to goods manufactured from agricultural 
products, and in particular the provisions of those Regulations which allow for derogation from the 
general principle that protective measures at frontiers may be replaced solely by the measures provided 
for in those Regulations, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European parliament, 
Whereas, by Regulation (EC) No 2423/88 (*), as amended by Regulation (EC) No 521/94(2) and 
Regulation (EC) No 522/94 (3 ), the Council adopted common rules for protection against dumped or 
subsidised imports from countries which are not members of the European Economic Community; 
Whereas, these rules were adopted in accordance with existing international obligations, in particular 
those arising from Article VI of the General Agreement on Tariffs and Trade, from the Agreement on 
Implementation of Article VI of the GATT (1979 Anti-Dumping Code) and from the Agreement on 
Interpretation and Application of Articles VI, XVI and XXIII of the GATT (Code on Subsidies and 
Countervailing Duties); 
Whereas, the multilateral trade negotiations concluded in 1994 have led to new Agreements on the 
implementation of Article VI of GATT and it is therefore appropriate to amend the Community rules in 
the light of these new Agreements; whereas it is also desirable, in the light of the different nature of the 
new rules for dumping and subsidies, to have separate Community rules in these two areas and, 
consequently, the new rules on protection against subsidies and countervailing duties are dealt with in a 
separate Regulation; 
Whereas, in applying these rules it is essential, in order to maintain the balance of rights and obligations 
which the GATT Agreement establishes, that the Community takes account of their interpretation by the 
Community's major trading partners; 
Whereas, the new agreement on dumping, namely, the Agreement on Implementation of Article VI of 
the General Agreement on Tariffs and Trade 1994 (1994 Anti-Dumping Agreement), contains new and 
detailed rules, in particular, with regard to the calculation of dumping, procedures for initiation and the 
subsequent investigation, including the establishment and treatment of the facts, the imposition of 
provisional measures, the imposition and collection of anti-dumping duties, the duration and review of 
anti-dumping measures and the public disclosure of information relating to anti-dumping investigations; 
whereas, in view of the extent of the changes and to ensure an adequate and transparent implementation 
of the new rules, it is appropriate to transpose the language of the new agreements into Community 
legislation to the extent possible; 
(]) OJ No L 209, 2.8.1988, p. 1. 
H OJ No L 66, 10.3.1994, p. 7. 
(3)OJNoL66, 10.3.1994, p. 10. 
A\o 
Whereas, it is desirable to lay down clear and detailed rules on the calculation of normal value, in 
particular that in all cases it should be based on representative sales in the ordinary course of trade in the 
exporting country; whereas, it is expedient to define the circumstances in which domestic sales may be 
considered to be made at a loss and disregarded and that recourse may be made to remaining sales or 
constructed value or sales to a third country; whereas it is also desirable to provide for a proper 
allocation of costs, including in start-up situations, where it is also appropriate to lay down guidance on 
the definition of start-up and the extent and method of allocation; whereas it is also necessary, when 
constructing normal value, to indicate the methodology that shall be applied to determine the amounts for 
selling, general and administrative costs and the profit that shall be included in such value. 
Whereas, when determining normal value for non-market economy countries, it appears prudent to set 
out rules of procedure for choosing the appropriate market economy third country that shall be used for 
such purpose and, where it is not possible to find a suitable third country, to provide that normal value 
may be established on any reasonable basis. 
Whereas, it is expedient to define the export price and to enumerate the adjustments which shall be made 
in those cases where a reconstruction of this price from the first open-market price is deemed necessary; 
Whereas, for the purpose of ensuring a fair comparison between export price and normal value, it is 
advisable to list the factors which may affect prices and price comparability and to lay down specific 
rules on when and how the adjustments shall be made, including the fact that any duplication of 
adjustments has to be avoided; whereas, it is also necessary to provide that comparison may be made 
using average prices though individual export prices may be compared to an average normal value where 
the former vary by customer, region or time period; 
Whereas, it is desirable to lay down clear and detailed guidance on the factors which may be relevant for 
the determination of whether the dumped imports have caused material injury or are threatening to cause 
injury; whereas, in demonstrating that the volume and price levels of the imports concerned are 
responsible for injury sustained by a Community industry, attention should be given to the effect of other 
factors and in particular existing market conditions in the Community. 
Whereas, it is advisable to define the term "Community industry" and provide that parties related to 
exporters may be excluded from such industry and to define the term "related"; whereas, it is also 
necessary to provide for anti-dumping action to be taken on behalf of producers in a region of the 
Commumty and to lay down guidelines on the definition of such a region. 
Whereas, it is necessary to set down who may lodge an anti-dumping complaint, including the extent to 
wiiich it should be supported by the Community industry, and the information on dumping, injury and 
causality which such complaint should contain; whereas, it is also expedient to specify the procedures 
with regard to the rejection of complaints or the initiation of proceedings. 
Whereas, it is necessary to lav down how interested parties shall be given notice of the information 
which the authorities require, ample opportunity to present all relevant evidence and a full opportunity 
for the defence of their interests: whereas, it is also desirable to set out clearly the rules and procedures 
to be followed during the investigation, in particular that interested parties have to make themselves 
known, present their views and submit information within specified time limits, if such views and 
information are to be taken into account; whereas, it is also appropriate to set out the conditions under 
which an interested party may have access to, and comment on, information presented by other interested 
parties; whereas, there should also be cooperation between the Member States and the Commission with 
regard to the collection of information. 
A-\l 
Whereas, it is necessary to lay down the conditions under which provisional duties may be imposed, 
including that they may not be imposed sooner than 60 days from initiation and no later than 9 months 
from initiation; whereas, for administrative reasons, it is also necessary to provide that such duties may 
in all cases be imposed by the Commission either directly for a nine month period or in two stages of six 
and three months. 
Whereas, it is necessary to specify procedures for the acceptance of undertakings which eliminate the 
dumping and injury instead of the imposition of provisional or definitive duties; whereas, it is also 
appropriate to lay down the consequences of violation or withdrawal of undertakings and that 
provisional duties may be imposed in cases of suspected violation or where further investigation is 
necessary to complete the findings; whereas, in accepting undertakings, care should be taken that the 
proposed undertakings, and their enforcement, do not lead to anti-competitive behaviour. 
Whereas, in order to reflect the provisions of the Agreement, it is necessary to provide for the 
termination of cases, with or without measures, normally within twelve months, and in no case later than 
eighteen months, from the initiation of the investigation; whereas, investigations or proceedings should 
be terminated where the dumping is de-minimis or the injury is negligible and it is appropriate to define 
these terms; whereas, where measures are to be imposed, it is necessary to provide for the termination of 
investigations and to lay down that measures should be less than the margin of dumping if such lesser 
amount would remove the injury, as well as to specify the method of calculating the level of measures in 
cases of sampling. 
Whereas, it is necessary to provide for the retroactive collection of provisional duties as deemed 
appropriate and to define the circumstances which may trigger the retroactive application of duties to 
avoid the undermining of the definitive measures to be applied; whereas it is also necessary to provide 
that duties may be applied retroactively in cases of violation or withdrawal of undertakings. 
Whereas, it is necessary to provide that measures shall lapse after five years unless a review 
investigation indicates that they should be maintained; whereas, it is also necessary to provide, in cases 
where sufficient evidence is submitted of changed circumstances, for interim reviews or for 
investigations to determine whether refunds of anti-dumping duties are warranted; whereas it is also 
appropriate to lay down that in any re-calculation of dumping which necessitates a reconstruction of 
export prices, duties shall not be treated as a cost mcurred between importation and resale where the said 
duty is being reflected in the prices of the products subject to measures in the Community. 
Whereas, it is necessary to specifically provide for the re-assessment of export prices and dumping 
margins where the duty is being absorbed by the exporter through a form of compensatory arrangement 
and the measures are not being reflected in the prices of the products subject to measures in the 
Community. 
Whereas, the 1994 Anti-Dumping Agreement does not contain provisions with regard to the 
circumvention of anti-dumping measures, though a separate GATT Ministerial Decision recognises 
circumvention as a problem and has referred it to the GATT Anti-dumping Committee for resolution; 
whereas given the failure of the multilateral negotiations so far and pending the outcome of the referral to 
the GATT Anti-Dumping Committee, it is necessary to introduce new provisions into Community 
legislation to deal with practices, including simple assembly in the Community or a third country, which 
have as their main aim the circumvention of anti-dumping measures. 
Whereas, it is expedient to pennit the suspension of anti-dumping measures where there is a temporary 
change in market conditions which make the continued imposition of such measures temporarily 
inappropriate. 
A '} X» 
WTiereas, it is necessary to provide that imports under investigation may be made subject to registration 
upon importation to enable measures to be subsequently applied against such imports. 
Whereas, to ensure a proper enforcement of measures, it is necessary that Member States monitor and 
report to the Commission the import trade of products subject to investigation and subject to measures 
and the amount of duties collected under this regulation. 
Whereas, it is necessary to provide for consultations of an Advisory Committee at regular and specified 
stages of the investigation; whereas, the comrnittee shall consist of representatives of Member States 
with a representative of the Commission as chairman. 
Whereas, it is expedient to provide for verification visits to check information submitted on dumping and 
injury, though such visits should be dependent on proper replies to questionnaires being received. 
Whereas, it is essential to provide for sampling in cases where the number of parties or transactions are 
large in order to permit a timely completion of investigations. 
Whereas, it is necessary to provide that for parties who do not cooperate satisfactorily other information 
may be used to estabhsh findings and such information may be less favourable to the party than if it had 
cooperated. 
Whereas, provision should be made for the treatment of confidential information so that business secrets 
are not divulged. 
Whereas, it is essential that provision is made for the proper disclosure of the essential facts and 
considerations to parties which qualify for such treatment and that such disclosure is made, with due 
regard to the decision-making process in the Community, within a time period which permits parties to 
détend their interests. 
Whereas, it is prudent to provide for an administrative system under which arguments can be presented 
in relation to whether measures are in the Community interest, including the consumer interest, and to 
lay down the time periods within which such information has to be presented as well as the disclosure 
rights of the parties concerned. 
Whereas, it is imperative to link the implementation of time limits for the lodging of complaints, the 
initiation of proceedings and the imposition of provisional duties to the establishment of the necessary 
administrative structure within the Commission's services; whereas, the Council, therefore, should 
specify, in a decision to be adopted by qualified majority no later than 1 April 1995, when these time 
limits shall apply. 
Has Adopted This Regulation: 
A"j "> 
Article 1 
Principles 
1.1 An anti-dumping duty may be applied to any dumped product whose release for free circulation 
in the Community causes injury. 
1.2 A product is to be considered as being dumped if its export price to the Community is less than a 
comparable price for the like product, in the ordinary course of trade, as established for the exporting 
country. 
1.3 The exporting country shall normally be the country of origin. However, it may be an 
intermediate country, except where, for example, the products are merely trans-shipped through that 
country, or the products concerned are not produced in that country, or there is no comparable price for 
them in that country. 
1.4 For the purpose of this Regulation, the term "like product" shall be interpreted to mean a product 
which is identical, i.e., alike in all respects to the product under consideration, or in the absence of such a 
product, another product which although not alike in all respects, has characteristics closely resembling 
those of the product under consideration. 
Article 2 
Determination of dumping 
A. Normal value 
2.1 The normal value shall normally be based on the prices paid or payable, in the ordinary course 
of trade, bv independent customers in the exporting country. 
2.1.1 Where the producer or exporter in the exporting country neither produces nor sells the 
like product the normal value may be established on the basis of prices of other sellers or producers. 
2.1.2 Prices between parties which appear to be associated or to have a compensatory 
arrangement with each other may be considered as being in the ordinary course of trade and may be 
used to establish normal value only if it is determined that they are not affected by the relationship. 
2.2 Sales of the like product destined for domestic consumption, shall normally be used to determine 
normal value if such sales volume constitute 5 per cent or more of the sales volume of the product under 
consideration to the Community. However, a lower volume of sales may be used when, for example, the 
prices charged are considered representative for die market concerned. 
2.3 When there are no or insufficient sales of the like product in the ordinary course of trade, or 
where because of the particular market situation such sales do not permit a proper comparison, the 
normal value of the like product shall be calculated on the basis of the cost of production in the country 
of origin plus a reasonable amount for selling, general and administrative costs and for profits, or based 
on the export prices, in the ordinary course of trade, to an appropriate third country, provided that these 
prices are representative. 
2.4 Sales of the like product in the domestic market of the exporting country, or export sales to a 
third country, at prices below per unit (fixed and variable) costs of production plus selling, general and 
administrative costs may be treated as not being in the ordinary course of trade by reason of price and 
may be disregarded in determining normal value only if it is determined that such sales are made within 
an extended period of time in substantial quantities, and are at prices which do not provide for the 
recovery of all costs within a reasonable period of time. 
2.4.1 If prices which are below costs at the time of sale are above weighted average costs for 
the period of investigation, such prices shall be considered to provide for recovery of costs within a 
reasonable period of time. 
2.4.2 The extended period of time should normally be one year but shall in no case be less 
than six months and sales below per unit cost shall be considered to be made in substantial quantities 
within such a period when it is established that die weighted average selling price is below the 
weighted average unit cost, or that the volume of sales below unit cost is not less than 20 per cent of 
sales being used to determine normal value. 
•A A\ 
2.5 For the purpose of Article 2, Section A, costs shall normally be calculated on the basis of 
records kept by the party under investigation, provided that such records are in accordance with the 
generally accepted accounting principles of the country concerned and it is shown that the records 
reasonably reflect the costs associated with the production and sale of the product under consideration. 
2.5.1 Consideration shall be given to evidence submitted on the proper allocation of costs, 
provided that it is shown that such allocations have been historically utilised. In the absence of a more 
appropriate method, preference shall be given to the allocation of costs on the basis of turnover. 
Unless already reflected in the cost allocations under this paragraph, costs shall be adjusted 
appropriately for those non-recurring items of cost which benefit future and/or current production. 
2.5.2 Where the costs for part of the period for cost recovery are affected bv the use of new 
production facilities requiring substantial additional investment and bv low capacity utilisation rates, 
which are the result of start-up operations which take place within or during part of the investigation 
period, the average costs for the start-up phase shall be those applicable, under the above-mentioned 
allocation rules, at the end of such a phase, and shall be included at that level, for the period 
concerned, in the weighted average costs referred to in paragraph 4.1. The length of a start-up phase 
shall be determined in relation to the circumstances of the producer or exporter concerned, but shall 
not exceed an appropriate initial portion of the period for cost recovery. For this adjustment to costs 
applicable during the investigation period, information relating to a start-up phase which extends 
beyond that period shall be taken into account in so far as it is submitted prior to verification visits 
and within three months of the initiation of the investigation. 
2.6 For the purpose of Article 2, Section A, the amounts for selling, general and administrative costs 
and for profits shall be based on actual data pertaining to production and sales, in the ordinary course of 
trade, of the hke product, by the exporter or producer under investigation. When such amounts cannot be 
determined on this basis, the amounts may be determined, on the basis of: 
(i) the weighted average of the actual amounts determined for other exporters or producers subject 
to investigation in respect of production and sales of the like product, or individual types thereof, in 
the domestic market of the country of origin; 
(ii) the actual amounts applicable to production and sales, in the ordinary course of trade, of the 
same general category of products for the exporter or producer in question in the domestic market of 
the country of origin; 
(iii) any other reasonable method, provided that the amount for profit so established shall not exceed 
the profit normally realised by other exporters or producers on sales of products of the same general 
category in the domestic market of the country of origin. 
Al H 
2.7 In the case of imports from non-market economy countries and, in particular, those to which 
Regulation (EC) No 519/94^ applies, normal value shall be determined on the basis of the price or 
constructed value in a market economy third country, or the price from such a third country to other 
countries, including the Community, or where these are not possible, on any other reasonable basis. 
including the price actually paid or payable in the Community for the like product, duly adjusted, if 
necessary, to include a reasonable profit margin. 
2.7.1 For the purpose of this paragraph, an appropriate market economy third country shall 
be selected in a not unreasonable manner, with due account taken of any reliable information made 
available at the time of selection. Account shall also be taken of time lunits and, where appropriate, a 
market economy third country which is subject to the same investigation shall be used. 
2.7.2 The parties to the investigation shall be informed shortly after initiation of the market 
economy third country envisaged and shall be given 10 days to comment. 
(4) OJ No L 67, 10.3.1994, p. 89. 
AA\ 
B. Export price ' 
2.8 The export price shall be the price actually paid or payable for the product when sold from the 
exporting country to the Community. 
2.9 In cases where there is no export price or where it appears that the export price is unreliable 
because of association or a compensatory arrangement between the exporter and the importer or a third 
party, the export price may be constructed on the basis of the price at which the imported products are 
first resold to an independent buyer, or if the products are not resold to an independent buyer, or not 
resold in the condition as imported, on any reasonable basis. 
2.9.1 In these cases, adjustment for all costs, including duties and taxes, incurred between 
importation and resale, and for profits accruing, shall be made to establish a reliable export price, at 
the Community frontier level. 
2.9.2 The costs for which adjustment shall be made include those normally bome by an 
importer but paid by any party, either in or outside the Community, which appears to be associated or 
to have a compensatory arrangement with the importer or exporter, including: usual transport, 
insurance, handling, loading and ancillary costs; customs duties, any anti-dumping duties, and other 
taxes payable in the importing country by reason of the importation or sale of the goods; and a 
reasonable margin for selling, general and administrative costs and profit. 
10 
C. Comparison 
2.10 A fair comparison shall be made between the export price and the normal value. This 
comparison shall be made at the same level of trade and in respect of sales made at as nearly as possible 
the same time and with due account taken of other differences. Where the normal value and the export 
price as established are not on such a comparable basis due allowance, in the form of adjustments, shall 
be made in each case, on its merits, for differences in factors which are claimed, and demonstrated to 
affect prices and, therefore, price comparability. Any duplication when making adjustments shall be 
avoided, in particular in relation to discounts, rebates, quantities and level of trade. When the specified 
conditions are met, the factors for which adjustments can be made are listed hereafter: 
(a) Physical characteristics 
An adjustment shall be made for differences in the physical characteristics of the product concerned. 
The amount of the adjustment shall correspond to a reasonable estimate of the market value of the 
difference. 
(b) Import charges and indirect taxes 
An adjustment shall be made to normal value for an amount corresponding to any import charges or 
indirect taxes borne by the like product and by materials physically incorporated therein, when 
destined for consumption in the exporting country and not collected or refunded in respect of the 
product exported to the Community. 
(c) Discounts, rebates and quantities 
An adjustment shall be made for differences in discounts and rebates, including those given for 
differences in quantities, if these are properly quantified and are directly linked to the sales under 
consideration. An adjustment may also be made for deferred discounts and rebates if the claim is 
based on consistent practice in prior periods, including compliance with the conditions required to 
qualify for the discount or rebates. 
(d) Level of trade 
An adjustment for differences in levels of trade shall be granted where, in relation to the distribution 
chain in both markets, it is shown that the export price, including a constructed export price, is at a 
different level of trade to the normal value and the difference has affected price comparability which 
is demonstrated bv consistent and distinct differences in functions and prices of the seller for the 
different levels of trade in the domestic market of the exporting country. The amount of the 
adjustment shall be based on the market value of the difference. 
(e) Transport, insurance, handling, loading, and ancillary costs 
An adjustment shall be made for differences in the directly related costs incurred for conveying the 
product concerned from the premises of the exporter to an independent buyer, where such costs are 
included in the prices charged. These costs comprise transport, insurance, handling, loading and 
ancillary costs. n ? 
11 
(f) Packing: ' 
An adjustment shall be made for differences in the respective, directly related costs of the packing for 
the product concerned. 
(g) Credit 
An adjustment shall be made for differences in the cost of any credit granted for the sales under 
consideration, provided that it is a factor taken into account in the determination of the prices 
charged. 
(h) After-sales costs 
An adjustment shall be made for differences in the direct costs of providing warranties, guarantees, 
technical assistance and services, as provided for bv law and/or in the sales contract. 
(i) Commissions 
An adjustment shall be made for differences in commissions paid in respect of the sales under 
consideration. 
(j) Currency conversions 
When the price comparison requires a conversion of currencies, such conversion should be made 
using the rate of exchange on the date of sale, provided that when a sale of foreign currency on 
forward markets is directly linked to the export sale involved, the rate of exchange in the forward sale 
shall be used. Normally, the date of sale should be the date of invoice but the date of contract, 
purchase order or order confirmation, may be used if these more appropriately establish the material 
terms of sale. Fluctuations in exchange rates shall be ignored and exporters shall be granted 60 days 
to reflect a sustained movement in exchange rates during the period of investigation. 
12 
~ ~ . . A~bo 
D. Dumping margin 
2.11 Subject to the releyant prpyisietis governing fair comparison, the existence of margins of 
dumping during the investigation period.shall normally be established on the basis of a comparison of a 
weighted average normal value with a weighted average of prices of all export transactions to the 
Cornrniuirtv or by a comparison of individual normal vaines and individual export prices to the 
Community on a transaction to transaction basis. However, a normal value established on a weighted 
average basis may be compared to prices of all individual export transactions to the Community, if there 
is a pattern of export prices which differ significantly among different purchasers, regions or time 
periods and the methods specified m foe first sentence of this paragraph would not reflect the full degree 
of dumping being practised. This paragraph shall not preclude the use of sampling in accordance with 
Article 17. 
2.12 The dumping margin shall be the amount by which the normal value exceeds the export price. 
Where dumping margins vary, a weighted average dumping margin may be established. 
13 
Article 3 , A»'l 
Determination of Injury 
3.1 Under this Regulation, the term "injury" shall, unless otherwise specified, be taken to mean 
material injury to the Community industry, threat of material injury to the Community industry or 
material retardation of the establishment of such an industry and shall be interpreted in accordance with 
the provisions of this Article. 
3.2 A determination of injury shall be based on positive evidence and involve an objective 
examination of both (a) the volume of the dumped imports and the effect of the dumped imports on 
prices in the Community market for like products, and (b) the consequent impact of these imports on the 
Community industry. 
3.3 With regard to the volume of the dumped imports, consideration shall be given as to whether 
there has been a significant increase in dumped imports, either in absolute terms or relative to production 
or consumption in the Community. With regard to the effect of the dumped imports on prices, 
consideration shall be given as to whether there has been a significant price undercutting by the dumped 
imports as compared with the price of a like product of the Community industry, or whether the effect of 
such imports is otherwise to depress prices to a significant degree or prevent price increases, which 
otherwise would have occurred, to a significant degree. No one or several of these factors can necessarily 
give decisive guidance. 
3.4 Where imports of a product from more than one country are simultaneously subject to anti­
dumping investigations, the effects of such imports shall be cumulatively assessed only if it is determined 
that (a) the margin of dumping established in relation to the imports from each country is more than de 
minimis as defined in Article 9.3 and that the volume of imports from each country is not negligible and 
(b) a cumulative assessment of the effects of the imports is appropriate in light of the conditions of 
competition between imported products and the conditions of compétition between the imported products 
and the like Community product. 
3.5 The examination of the impact of the dumped imports on the Community industry concerned 
shall include an evaluation of all relevant economic factors and indices having a bearing on the state of 
the industry including: the fact that an industry is still in the process of recovering from the effects of 
past dumping or subsidisation, the magnitude of the actual margin of dumping, actual and potential 
decline in sales, profits, output, market share, productivity, return on investments, utilisation of capacity; 
factors affecting Community prices; actual and potential negative effects on cash flow, inventories, 
employment, wages, growth, ability to raise capital or investments. This list is not exhaustive, nor can 
one or several of these factors necessarily give decisive guidance. 
3.6 It must be demonstrated, from all the relevant evidence presented in relation to paragraph 2. that 
the dumped imports are causing injury within the meaning of this Regulation. Specifically, this shall 
entail a demonstration that the volume and/or price levels identified under paragraph 3 are responsible 
for an impact on the Community industry as provided for in paragraph 5. and that this impact exists to a 
degree which enables it to be classified as material. 
14 
A Y ) 
3.7 Known factors other than the dumped imports, which at the same time are injuring the ' ' "^ 
Community industry shall also be examined to ensure that injury caused by these other factors is not 
attributed to the dumped imports under paragraph 6. Factors which may be considered in this respect 
include, inter alia, the volume and prices of imports not sold at dumping prices, contraction in demand or 
changes in the patterns of consumption, trade restrictive practices of and competition between the foreign 
and Community producers, developments in technology and the export performance and productivity of 
the Community industry. 
3.8 The effect of the dumped imports shall be assessed in relation to the production of the 
Community industry of the like product when available data permit the separate identification of that 
production on the basis of such criteria as the production process, producers' sales and profits. If such 
separate identification of that production is not possible, the effects of the dumped imports shall be 
assessed by the examination of the production of the narrowest group or range of products, which 
includes the like product, for which the necessary information can be provided. 
3.9 A determination of a threat of material injury shall be based on facts and not merely on 
allegation, conjecture or remote possibility. The change in circumstances which would create a situation 
in which the dumping would cause injury must be clearly foreseen and imminent. 
3.9.1 In making a determination regarding the existence of a threat of material injury, 
consideration should be given to, inter aha, such factors as: 
(i) a significant rate of increase of dumped imports into the Community market indicating the 
likelihood of substantially increased imports; 
(ii) sufficient freely disposable or an imminent, substantial increase in capacity of the 
exporter indicating the likelihood of substantially increased dumped exports to the Community, 
taking into account the availability of other export markets to absorb any additional exports; 
(iii) whether imports are entering at prices that would, to a significant degree, depress prices 
or prevent price increases which otherwise would have occurred, and would likely increase demand 
for further imports; and 
(îv) inventories of the product being investigated. 
3.9.2 No one of the factors listed above by itself can necessarily give decisive guidance but 
the totality of the factors considered must lead to the conclusion that further dumped exports are 
imminent and that, unless protective action is taken, material injury would occur. 
15 
Article 4 
Definition of Community industry 
4.1 For the purposes of this Regulation, the term " the Community industry" shall be interpreted as 
referring to the Community producers as a whole of the like products or to those of them whose 
collective output of the products constitutes a major proportion, as defined in Article 5.4. of the total 
Community production of those products, except that 
(i) when producers are related to the exporters or importers or are themselves importers of the 
allegedly dumped product, the term "the Community industry" may be interpreted as referring to the 
rest of the producers; 
(ii) in exceptional circumstances the territory of the Community may, for the production in question, 
be divided into two or more competitive markets and the producers within each market may be 
regarded as a separate industry if (a) the producers within such market sell all or almost all of their 
production of the product in question in that market, and (b) the demand in that market is not to any 
substantial degree supplied by producers of the product in question located elsewhere in the 
Community. In such circumstances, injury may be found to exist even where a major portion of the 
total Community industry is not injured, provided there is a concentration of dumped imports into 
such an isolated market and provided further that the dumped imports are causing injury to the 
producers of all or almost all of the production within such market. 
4.2 For the purpose of paragraph 1, producers shall be considered to be related to exporters or 
importers only if (a) one of them directly or mdirectly controls the other: or (b) both of them are directly 
or indirectly controlled by a third person; or (c) together they directly or indirectly control a third person, 
provided that there are grounds for behevmg or suspecting that the effect of the relationship is such as to 
cause the producer concerned to behave differently from non-related producers. For the purpose of this 
paragraph, one shall be deemed to control another when the former is legally or operationally in a 
position to exercise restraint or direction over the latter. 
4.3 Where the Community industry has been interpreted as referring to the producers in a certain 
region, the exporters shall be given an opportunity to offer undertakings pursuant to Article 8 in respect 
of the region concerned. If an adequate undertaking is not offered promptly or the situations set out in 
Article 8.9 and Article 8.10 apply, a provisional or definitive duty may be imposed in respect of the 
Community as a whole. In such cases, the duties may, if practicable, be limited to specific products or 
exporters. 
4.4 The provisions of Article 3.8 shall be applicable to this Article. Ah 
16 
Article 5 1 
Initiation of proceedings 
5.1 Except as provided for in Article 5.6, an investigation to determine the existence, degree and 
effect of any alleged dumping shall be initiated upon a written complaint by any natural or legal person, 
or any association not having legal personality, acting on behalf of the Community industry. 
5.1.1 The complaint may be submitted to the Commission, or a Member State, which shall 
forward it to the Commission. The Commission shall send Member States a copy of any complaint it 
receives. The complaint shall be deemed to have been lodged on the first working day following 
its delivery to the Commission by registered mail or the issuing of an acknowledgement of receipt 
by the Commission. 
5.1.2 Where, in the absence of any complaint, a Member State is in possession of sufficient 
evidence of dumping and of injury resulting therefrom for the Community industry, it shall 
immediately communicate such evidence to the Commission. 
5.2 A complaint under paragraph 1 shall include evidence of dumping, injury and à causal link 
between the allegedly dumped imports and the alleged injury. The complaint shall contain such 
information as is reasonably available to the complainant on the following: 
(i) identity of the complainant and a description of the volume and value of the Community 
production of the like product by the complainant. Wfaere a written complaint is made on behalf of 
the Community industry, the complaint shall identify the industry on behalf of which the complaint is 
made by a list of all known Community producers of the like product (or associations of Community 
producers of the hke product) and, to the extent possible, a description of the volume and value of 
Community production of the like product accounted for by such producers; 
(ii) a complete description of the allegedly dumped product, the names of the country or countries of 
origin or export in question, the identity of each known exporter or foreign producer and a list of 
known persons importing the product in question; 
(iii) information on prices at which the product in question is sold when destined for consumption in 
the domestic markets of the country or countries of origin or export (or, where appropriate, 
information on the prices at which the product is sold from the country or countries of origin or 
export to a third country or countries or on the constructed value of the product) and information on 
export prices or, where appropriate, on the prices at which the product is first resold to an 
independent buyer in the Community; 
(iv) information on the evolution of the volume of the allegedly dumped imports, the effect of these 
imports on prices of the like product on the Community market and the consequent impact of the 
imports on the Community industry, as demonstrated by relevant factors and indices having a bearing 
on the state of the Community industry, such as those listed in Article 3.3 and 3.5. 
5.3 The Commission shall, to the degree possible, examine the accuracy and adequacy of the 
evidence provided in the complaint to determine whether there is sufficient evidence to justify the 
initiation of an investigation. 
17 
5.4 An investigation shall not be initiated pursuant to paragraph I unless it has been determined, on 
the basis of an examination of the degree of support for, or opposition to, the complaint expressed by 
Community producers of the like product, that the complaint has been made by or on behalf of the 
Community industry. The complaint shall be considered to have been made "by or on behalf of the 
Community industry" if it is supported by those Community producers whose collective output 
constitutes more than 50 per cent of the total production of the like product produced by that portion of 
the Community industry expressing either support for or opposition to the complaint. However, no 
investigation shall be initiated when Community producers expressly supporting the complaint account 
for less than 25 per cent of total production of the like product produced by the Community industry. 
5.5 The authorities shall avoid, unless a decision has been made to initiate an investigation, any 
publicising of the complaint for the initiation of an investigation. However, after receipt of a properly 
documented complaint and before proceeding to initiate an investigation, the government of the exporting 
country concerned shall be notified. 
5.6 If in special circumstances, it is decided to initiate an investigation without having received a 
written complaint by or on behalf of the Community industry for the initiation of such investigation, this 
shall be done on the basis of sufficient evidence of dumping, injury and a causal link, as described in 
paragraph 2, to justify the initiation of an investigation. 
5.7 The evidence of both dumping and injury shall be considered simultaneously in the decision 
whether or not to initiate an investigation. A complaint shall be rejected where there is insufficient 
evidence of either dumping or of injury to justify proceeding with the case. In this respect, the imports 
concerned shall normally be regarded as negligible if the volume of dumped imports from a particular 
country accounts for less than 3 per cent of imports of the like product in the Community unless 
countries which individually account for less than 3 per cent of the imports of the like product in the 
Community collectively account for more than 7 per cent of imports of the like product in the 
Community. 
5.8 The complaint may be withdrawn prior to initiation, in which case it shall be considered not to 
have been lodged. 
5.9 Where, after consultation, it is apparent that there is sufficient evidence to justify initiating 
proceedings the Commission shall initiate proceedings within one month of the lodging of the 
complaint and publish a notice in the Official Joumal of the European Communities. Where insufficient 
evidence has been presented, the complainant shall, after consultation, be so informed within one month 
of the date on which the complaint is lodged with the Commission. 
5.10 The notice of initiation of the proceedings shall announce the initiation of an investigation. 
indicate the product and countries concerned, give a summary of the information received, and provide 
that all relevant information is to be communicated to the Commission; it shall state the periods within 
which interested parties may make themselves known, present their views in writing and submit 
information, if such views and information are to be taken into account during the investigation; it 
shall also state the period within which interested parties may apply to be heard by the Commission in 
accordance with Article 6.5. A ;\f 
18 
A% 
5.11 The Commission shall advise the exporters and importers known to it to be concemed, as well as 
representatives of the exporting country and the complainants, of the initiation of the proceedings and, 
with due regard to the protection of confidential information, provide the full text of the written 
complaint received under Article 5.1 to the known exporters, and to the authorities of the exporting 
country and make it available, upon request, to other interested parties involved. Where the number of 
exporters involved is particularly high, the full text of the written complaint should instead be provided 
only to the authorities of the exporting country or to the relevant trade association. 
5.12 An anti-dumping investigation shall not hinder the procedures of customs clearance. 
19 
Aï 
Article 6 
The investigation 
A. Information and procedure 
6.1 Following the initiation of the proceedings, the Commission, acting in co-operation with the 
Member States, shall commence an investigation at Community level. Such investigation shall cover 
both dumping and injury and these shall be investigated simultaneously. For the purpose of a 
representative finding, an investigation period shall be selected which, in the case of dumping shall, 
normally, cover a period of not less than six months immediately prior to the initiation of the 
proceedings. Information relating to a period subsequent to the investigation period shall, normally, not 
be taken into account. 
6.2 Parties receiving questionnaires used in an anti-dumping investigation shall be given at least 
thirty days for reply. The time-limit for exporters shall be counted from the date of receipt of the 
questionnaire, which for this purpose shall be deemed to have been received one week from the day on 
which it was sent to the exporter or transmitted to the appropriate diplomatic representative of the 
exporting country. An extension to the thirty day period may be granted, taking due account of the time 
limits of the investigation and provided the party gives a good reason, in terms of its particular 
circumstances, for such extension. 
6.3 The Commission may request Member States to supply information and Member States shall 
take whatever steps are necessary in order to give effect to such requests. They shall send to the 
Commission the information requested together with the results of all inspections, checks or 
investigations carried out. Where this information is of general interest or where its transmission has 
been requested by a Member State, the Commission shall forward it to the Member States, provided it is 
not confidential, in which case a non-confidential summary shall be forwarded. 
6.4 The Commission may request Member States to carry out all necessary checks and inspections, 
particularly amongst importers, traders and Community producers, and to carry out investigations in 
third countries, provided the firms concerned give their consent and the government of the country in 
question has been officially notified and raises no objection. Member States shall take whatever steps are 
necessary in order to give effect to such requests from the Commission; Officials of the Commission 
shall be authorised, if the Commission or a Member State so requests, to assist the officials of Member 
States in carrying out their duties. 
6.5 The interested parties, which have made themselves known in accordance with Article 5.10. may 
be heard if they have, within the period prescribed in the notice published in the Official Journal of the 
European Communities, made a written request for a hearing showing that they are an interested party 
likely to be affected by the result of the proceedings and that there are particular reasons why they 
should be heard. 
6.6 Opportunities shall, on request, be provided for the importers, exporters, representatives of the 
government of the exporting country and the complainants, which have made themselves known in 
accordance with Article 5.10. to meet those parties with adverse interests, so that opposing views may be 
presented and rebuttal arguments offered. Provision of such opportunities must take account of the need 
to preserve confidentiality and of the convenience to the parties. There shall be no obligation on any 
party to attend a meeting, and failure to do so shall not be prejudicial to that party's case. Oral 
information provided under this paragraph shall be taken into account in so far as it is subsequently 
reproduced in writing. 
20 
6.7 The complainants, importers, exporters, users and consumer organisations, 
made themselves known in accordance with Article 5.10, as well as the representatives 01 
country may, upon written request, inspect all information made available by any party to 
investigation, as distinct from internal documents prepared by the authorities of the C 
Member States, which is relevant to the presentation of their cases and not confidential w^hltô 
meaning of Article 19, and that it is used in the investigation. Such parties may respond to 
information and their comments should be taken into consideration, to the extent that they are^* 
sufficiently substantiated in the response. $Mù 
6.8 Except in the circumstances provided for in Article 18, the information supplied by ; 
parties and upon which findings are based, shall be examined for accuracy to the degree j 
6.9 Investigations shall, except in special circumstances, be concluded within one year; \ 
case more than 18 months, after their initiation. 
m 
AM 
»Xi 
<» Mi 
21 !Ai l 
Artîffef 
measures 
7.1 ^Provisional measures may be applied if proceedings have been initiated in accordance with the 
provisions of Article 5, a public notice has been given to that effect and interested parties have been 
given fHJpcfoate opportunities to submit information and make comments in accordance with Article 5.10. 
a proviiional affirmative determination has been made of dumping and consequent injury to the 
CofOfl|ijpgÇY industry, and the Community interest calls for intervention to prevent such injury. The 
measures shall be imposed no sooner than 60 days from the initiation of the proceedings 
* {JKfff nine months from the initiation of the proceedings. 
amount of the provisional anti-dumping duty shall not exceed the margin of dumping as 
established but it should be less than the margin, if such lesser duty would be adequate to 
Itijury to the Community industry. 
ional measures shall take the form of a security and the release of the products concemed 
tion in the Community shall be conditional upon the provision of such security. 
ommission shall take provisional action after consultation or, in cases of extreme urgency, 
the Member States. In this latter case, consultations shall take place 10 days, at the 
notification to the Member States of the action taken by the Commission. 
Wry 'fi a Member State requests immediate intervention by the Commission and the conditions of 
the Commission shall within a maximum of five working days of receipt of the 
whether a provisional anti-dumping duty should be imposed. 
rÈomrrussion shall forthwith inform the Council and the Member States of any decision 
pjts Article. The Council, acting by a qualified majority, may decide differently. 
al duties may be imposed for six months and extended for a further three months or 
for nine months. However, they may only be extended, or imposed for a ninfr 
erq exporters representing a significant percentage of the trade involved so request or 
upon notification bvthe Commission. 
CWk: 
22 
A% 
Article 8 
Undertakings 
8.1 Investigations may be terminated without the imposition of provisional or definitive duties upon 
receipt of satisfactory voluntary undertakings from any exporter to revise its prices or to cease exports to 
the area in question at dumped prices so that the Commission, after consultation, is satisfied that the 
injurious effect of the dumping is eliminated. Price increases under such undertakings shall not be higher 
than necessary to eliminate the margin of dumping and they should be less than the margin of dumping if 
such increases would be adequate to remove the injury to the Community industry. 
8.2 Undertakings may be suggested by the Commission, but no exporter shall be obliged to enter 
into such an undertaking. The fact that exporters do not offer such undertakings, or do not accept an 
invitation to do so, shall in no way prejudice the consideration of the case. However, it may be 
determined that a threat of injury is more likely to be realised if the dumped imports continue. 
Undertakings shall not be sought or accepted from exporters unless a provisional affirmative 
determination of dumping and injury caused by such dumping has been made. Save in exceptional 
circumstances, undertakings may not be offered later than the end of the period during which 
representations may be made under Article 20.5. 
8.3 Undertakings offered need not be accepted if their acceptance is considered impractical, for 
example, if the number of actual or potential exporters is too great, or for other reasons, including 
reasons of general policy. The exporter concerned may be provided with the basis on which it is intended 
to propose the rejection of the offer of an undertaking and may be given an opportunity to make 
comments thereon. The reasons for rejection shall be set out in the definitive decision. 
8.4 Parties which offer an undertaking shall be required to provide a non-confidential version of 
such undertaking, so that it may be made available to interested parties to the investigation. 
8.5 Where undertakings are, after consultation, accepted and there is no objection raised within the 
Advisory Committee, the investigation shall be terminated. In all other cases, the Commission shall 
submit to the Council forthwith a report on the results of the consultation, together with a proposal that 
the investigation be terminated. The investigation shall stand terminated if, within one month, the 
Council, acting by a qualified majority, has not decided otherwise. 
8.6 If the undertakings are accepted, the investigation of dumping and injury shall normally be 
completed. In such a case, if a negative determination of dumping or injury is made, the undertaking 
shall automatically lapse, except in cases where such a determination is due in large part to the existence 
of an undertaking. In such cases the authorities may require that an undertaking be maintained for a 
reasonable period. In the event that an affirmative determination of dumping and injury is made, the 
undertaking, shall continue consistent with its terms and the provisions of this Regulation. 
8.7 The Commission shall require any exporter from which an undertaking has been accepted to 
provide, periodically, information relevant to the fulfilment of such undertaking, and to permit 
verification of pertinent data. Non-compliance with such requirements shall be construed as a violation 
of the undertaking. 
23 
Acy 
8.8 Where undertakings are accepted from certain exporters during the course of an investigation, 
they shall, for the purpose of Article 11. be deemed to take effect from the date on which the 
investigation is concluded for the exporting country. 
8.9 In case of violation or withdrawal of undertakings bv any party, a definitive duty shall be 
imposed in accordance with Article 9. on the basis of the facts established within the context of the 
investigation which led to the undertaking, provided that such investigation was concluded with a final 
determination on dumping and injury and the exporter concerned, except in the case of withdrawal of 
undertakings bv the exporter, has been given an opportunity to comment. 
8.10 A provisional duty may, after consultation, be imposed in accordance with Article 7 on the basis 
of the best information available, where there is reason to believe that an undertaking is being violated, 
or in case of violation or withdrawal of undertaking where the investigation which led to the undertaking 
was not concluded. 
24 
'" < . Ac)x 
Article 9 
Termination without measures; imposition of definitive duties 
9.1 Where the complaint is withdrawn, proceedings may be terminated unless such termination 
would not be in the Community interest. * 
9.2 WTiere, after consultation, protective measures are unnecessary and there is no objection raised 
within the Advisory Committee, the investigation or proceedings shall be terminated. In all other cases, 
the Commission shall submit to the Council forthwith a report on the results of the consultation, together 
with a proposal that the proceedings be terminated. The proceedings shall stand terminated if, within one 
month, the Council, acting by a qualified majority, has not decided otherwise. 
9.3 For proceedings initiated under Article 5.9. injury shall normally be regarded as negligible where 
the imports concerned represent less than the volumes set out in Article 5 7. For the same proceedings, 
there shall be immediate termination where it is determined that the margin of dumping is less than 2 per 
cent, expressed as a percentage of the export price, provided that it is only the investigation that shall be 
terminated where the margin is below 2% for individual exporters and they shall remain subject to the 
proceedings and may be re-investigated in any subsequent review carried out for the country concerned 
under Article 11. 
9.4 Where the facts as finally established show that there is dumping and injury caused thereby, and 
the Community interest calls for intervention in accordance with Article 21. a definitive anti-dumping 
duty shall be imposed by the Council, acting by simple majority on a proposal submitted by the 
Commission after consultation of the Advisory Committee. Where provisional duties are in force, a 
proposal for definitive action shall be submitted to the Council not later than one month before the expiry 
of such duties. The amount of the anti-dumping duty shall not exceed the margin of dumping established 
but it should be less than the margin if such lesser duty would be adequate to remove the injury to the 
Community industry. 
9.5 An anti-dumping duty shall be imposed in the appropriate amounts in each case, on a non­
discriminatory basis on imports of a product from all sources found to be dumped and causing injury, 
except as to imports from those sources from which undertakings under the terms of this Regulation 
have been accepted. The Regulation shall specify the duty for each supplier or, if that is impracticable 
and in the cases referred to in Article 2.7. the supplying country concerned. 
9.6 When the Commission has limited its examination in accordance with Article 17, any anti­
dumping duty applied to imports from exporters or producers which have made themselves known in 
accordance with Article 17 but were not included in the examination shall not exceed the weighted 
average margin of dumping established for die parties in the sample. For the purpose of this paragraph, 
the Commission shall disregard any zero and de minimis margins, and margins established under the 
circumstances referred to in Article 18. The authorities shall apply individual duties or normal values to 
imports from any exporter or producer which is granted individual treatment as provided for in Article 
17. 
25 
A ^ 
Article 10 
Retroactivity 
10.1 Provisional measures and definitive anti-dumping duties shall only be applied to products which 
enter free circulation after the time when the decision taken under Article 7.1 and Article 9.5, 
respectively enters into force, subject to the exceptions set out in this Regulation. 
10.2 Where a provisional duty has been applied and the facts as finally established show that there is 
dumping and injury, the Council shall decide, irrespective of whether a definitive anti-dumping duty is to 
be imposed, what proportion of the provisional duty is to be definitively collected. For this purpose, 
'injury' shall not include material retardation of the estabhshment of a Community industry, nor threat of 
material injury, except where it is found that this would, in the absence of provisional measures, have 
developed into material injury. In all other cases involving such threat or retardation, any provisional 
amounts shall be released and definitive duties can only be imposed from the date that a final 
detennination of threat or material retardation is made. 
10.3 If the definitive anti-dumping duty is higher than the provisional duty, the difference shall not be 
collected. If the definitive duty is lower than the provisional duty, the duty shall be recalculated. Where a 
final determination is negative, the provisional duty shall not be confirmed. 
10.4 A definitive anti-dumping duty may be levied on products which were entered for consumption . 
not more than 90 days prior to the date of application of provisional measures but not prior to the 
initiation of the investigation, provided that imports have been registered in accordance with Article 
14.5, the Commission has provided the importers concemed with an opportunity to comment, and that: 
(i) there is, for the product in question, a history of dumping over an extended period, or the 
importer was aware of the dumping or the importer should have been aware of the dumpmg. in terms 
of the extent of the dumping and injury alleged or found; and 
(ii) in addition to the level of imports which caused injury during the investigation period, there is a 
further substantial rise in imports which, in the light of its timing and volume and other 
circumstances, is likely to seriously undermine the remedial effect of the definitive anti-dumping duty 
to be applied. 
10.5 In cases of violation or withdrawal of undertakings, definitive duties may be levied in 
accordance with this Regulation on goods entered for free circulation not more than ninety days before 
the application of provisional measures, provided that imports have been registered in accordance with 
Article 14.5, and that any such retroactive assessment shall not apply to imports entered before the 
violation or withdrawal of the undertaking. 
26 
Article 11 V) h 
Duration, reviews and refunds 
11.1 An anti-dumping measure shall remain in force only as long as and to the extent necessary to 
counteract dumping which is causing injury. 
11.2 A definitive anti-dumping measure shall expire five years from its imposition or five years from 
the date of the conclusion of the most recent review which has covered both dumping and injury unless it 
is determined in a review that the expiry would be likely to lead to a continuation or recurrence of 
dumping and injury. Such an expiry review shall be initiated on the initiative of the Commission, or upon 
request made by or on behalf of Community producers and the measure shall remain in force pending the 
outcome of such review. 
11.2.1 An expiry review shall be initiated where the request contains sufficient evidence that 
the removal of the measures would be likely to result in a continuation or recurrence of dumping and 
injury. Such a likelihood may, for example, be indicated bv evidence of continued dumping and injury 
or evidence that the removal of injury is partly or solely due to the existence of measures or evidence 
that the circumstances of the exporters, or market conditions, are such that thev would indicate the 
likelihood of further injurious dumping. 
11.2.2 In carrying out investigations under this paragraph, the exporters, importers, the 
representatives of the exporting country and the Community producers shall be provided with the 
opportunity to amplify, rebut or comment on the matters set out in the review request and conclusions 
shall be reached with due account taken of all relevant and duly supported evidence presented in 
relation to the question of whether the removal of measures would be likely, or unlikely, to lead to the 
continuation or recurrence of dumping and injury. 
11.2.3 Under this paragraph, a notice of impending expiry shall be published in the Official 
Journal of the European Communities at an appropriate time in the final year of the period of 
application of the measures as defined in this paragraph. Thereafter, the Community producers shall, 
no later than three months before the end of the five year period, be entitled to lodge a review request 
in accordance with paragraph 2.1. A notice announcing the actual expiry of measures under this 
paragraph shall also be published. 
11.3 The need for the continued imposition of measures may also be reviewed, where warranted on 
the initiative of the Commission or at the request of a Member State or, provided that a reasonable 
period of time of at least 1 year has elapsed since the imposition of the definitive measure, upon a 
request, by any exporter or importer or bv the Community producers, which contains sufficient evidence 
substantiating the need for such an interim review. 
11.3.1 An interim review shall be initiated where the request contains sufficient evidence that 
the continued imposition of the measure is no longer necessary to offset dumping and/or the injury 
would be unlikely to continue or recur if the measure were removed or varied, or that the existing 
measure is not, or is no longer, sufficient to counteract dumping which is causing injury. 
11.3.2 In carrying out investigations under this paragraph, the Commission may, inter alia, 
consider whether the circumstances with regard to dumping and injury have changed significantly, or 
whether existing measures are achieving the intended results in removing the injury previously 
established in accordance with Article 3 of this Regulation. In these respects, account shall be taken 
of all relevant and duly supported evidence in the final determination. 
27 
A% 
11.4 A review shall also be carried out for the purpose of determining individual margins of dumping 
for new exporters in the exporting country in question which have not exported the product during the 
period of investigation on which the measures were based. 
11.4.1 The review shall be initiated where a new exporter or producer can show that it is not 
related to any of the exporters or producers in the exporting country which are subject to the anti­
dumping measures on the product, and where they have actually exported to the Community 
following the above-mentioned investigation period, or where they can demonstrate that they have 
entered into a an irrevocable contractual obligation to export a significant quantity to the Community. 
11.4.2 A review for a new exporter shall be initiated, and carried out on an accelerated basis, 
after consultation of the Advisory Committee and Community producers have been given an 
opportunity to comment. The Commission Regulation initiating a review shall repeal the duty in force 
with regard to the new exporter concerned, bv amending the Regulation which imposed the duty, and 
making imports subject to registration in accordance with Article 14.5 in order to ensure that, should 
the review result in a determination of dumping in respect of such an exporter, anti-dumping duties 
can be levied retroactively to the date of the initiation of the review. 
11.4.3 The provisions of this paragraph shall not apply where duties have been imposed under 
the provisions of Article 9.6. 
11.5 The relevant provisions of this Regulation with regard to procedures and the conduct of 
investigations, excluding those relating to time limits, shall apply to any review carried out under 
paragraphs 2. 3 and 4. Any such review shall be carried out expeditiously and shall normally be 
concluded within twelve months of the date of initiation of the review. 
11.6 Reviews under this Article shall be initiated by the Commission after consultation of the 
Advisory Committee. Where warranted by reviews, measures shall be repealed or maintained under 
paragraph 2. or repealed, maintained or amended under paragraphs 3 and 4. by the Community 
institution responsible for their introduction. Where measures are repealed for mdividual exporters, but 
not for the country as a whole, such exporters shall remain subject to the proceedings and may, 
automatically, be re-investigated in any subsequent review carried out for that country under this Article. 
11.7 Where a review of measures under paragraph 3 is in progress at the end of the period of 
application of measures as defined in paragraph 2. such review shall also cover the circumstances set out 
in paragraph 2. 
28 
11.8 Notwithstanding paragraph 2. an importer may request reimbursement of duties collected where 
it is shown that the dumping margin, on the basis of which duties were paid, has been eliminated, or 
reduced to a level which is below the level of the duty in force. 
11.8.1 In order to request a refund of anti-dumping duties, the importer shall submit an 
application to the Commission. The application shall be submitted via the Member State in the 
territory of which the products were released for free circulation and within six months of the date on 
which the amount of the definitive duties to be levied was duly determined by the competent 
authorities or of the date on which a decision was made definitively to collect the amounts secured by 
way of provisional duty. Member States shall forward the request to the Commission forthwith. 
11.8.2 An application for refund shall only be considered to be duly supported by evidence 
where it contains precise information on the amount of refund of anti-dumping duties claimed and all 
customs documentation relating to the calculation and payment of such amount. It shall also include 
evidence, for a representative period, on normal values and export prices to the Community for the 
exporter or producer to which the duty applies. In cases where the importer is not associated to the 
exporter or producer concerned and such information is not immediately available, or the exporter or 
producer is unwilling to release it to the importer, the application shall contain a statement from the 
exporter or producer that the dumping margin has been reduced or eliminated, as specified in this 
Article, and that the relevant supporting evidence shall be provided to the Commission. Where such 
evidence is not forthcoming from the exporter or producer, within a reasonable period of time, the 
application shall be rejected. 
11.8.3 The Commission shall, after consultation of the Advisory Committee, decide whether 
and to what extent the application should be granted or it may decide at any time to initiate an interim 
review and the information and findings from such review, carried out in accordance with the 
provisions applicable for such reviews, shall be used to determine whether and to what extent a 
refund is justified. Refunds of duties shall normally take place within 12 months, and in no case more 
than 18 months after the date on which a request for a refund, duly supported by evidence, has been 
made by an importer of the product subject to the anti-dumping duty. The payment of any refund 
authorised should normally be made by Member States within 90 days of the above-mentioned 
decision. 
11.9 In all review or refund investigations carried out under this Article, the Commission shall apply, 
in so far as circumstances have not changed, the same methodology as in the investigation which led to 
the duty, with due account taken of the provisions set out in Articled, and in particular Section D 
thereof, and the provisions of Article 17 of this Regulation. 
11.10 In any investigation carried out under this Article, the Commission shall examine the reliability 
of export prices in accordance with Article 2. However, where it is decided to construct the export price 
in accordance with Article 2.9, it shall calculate the export price with no deduction for the amount of 
anti-dumping duties paid when conclusive evidence is provided that the duty is duly reflected in resale 
prices and the subsequent selling prices in the Community. A% 
29 
A3) 
Article 12 f 
12.1 Where the Community industry submits sufficient information showing that measures have led 
to no movement, or insufficient movement, in resale prices or subsequent selling prices in the 
Community, the investigation may, after consultation, be re-opened to examine whether the measure has 
had effects on the above-mentioned prices. 
12.2 During an investigation under this Article, exporters, importers and Community producers shall 
be provided with an opportunityto clarify the situation with regard to resale prices and subsequent 
selling prices and if it is concluded that the measure should have led to movements in such prices, in 
order to remove the injury previously established in accordance with Article 3. export prices shall be re­
assessed in accordance with Article 2. and dumping margins shall be re-calculated to take account of the 
re-assessed export prices. Where it is considered that a lack of movement in the prices in the Community 
is due to a fall in export prices, which occurred prior to or following the imposition of measures, 
dumping margins may be re-calculated to take account of such lower export prices. 
12.3 WTiere a re-investigation under this Article shows increased dumping, the measures in force shall 
be amended bv the Council, by simple majority on a proposal from the Commission, in accordance with 
the new findings on export prices. 
12.4 The relevant provisions of Article 5 and Article 6 shall apply to any review carried out under 
this Article, except that such review shall be carried out expeditiously and shall normally be concluded 
within six months of the date of initiation of the re-investigation. 
12.5 Alleged changes in normal value shall only be taken into account under this Article where 
complete information on revised normal values, duly substantiated bv evidence, is made available to the 
Commission within the time limits set out in the notice of initiation of an investigation. Where an 
investigation involves a re-examination of normal values, imports may be made subject to registration in 
accordance with Article 14.5 pending the outcome of the investigation. 
30 
Articled ^ 
Circumvention 
13.1 Anti-dumping duties imposed under this Regulation may be extended to apply to imports from 
third countries of like products, or parts thereof, when circumvention of the measures in force is taking 
place. Circumvention shall be defined as a change in the pattern of trade between third countries and the 
Community which stems from a practice, process or work for which there is insufficient due cause or 
economic justification, other than the imposition of the duty, and there is evidence that the remedial 
effects of the duty are being undennined. in terms of the prices and/or quantities of the assembled like 
product. 
13.2 An assembly operation in the Community or a third country shall be considered to circumvent 
the measures in force where: 
(i) the operation started or substantially increased since, or just prior to. the initiation of the anti­
dumping investigation and the parts concerned are from the country subject to measures: and 
(ii) the parts constitute 60% or more of the total value of the parts of the assembled product except 
that in no case shall circumvention be considered to be taking place where the value added to the 
parts brought in. during the assembly or completion operation, is greater than 25% of the 
manufacturing cost: and 
(iii) the remedial effects of the duty are being undermined, in terms of the prices and/or quantities of 
the assembled like product. 
13.3 Investigations shall be initiated under this Article where the request contains sufficient evidence 
on the factors set out in paragraph 1. Initiations shall be made, after consultation of the Advisory 
Committee, bv Commission Regulation which shall also instruct the customs authorities to make imports 
subject to registration in accordance with Article 14.5 or to request guarantees. Investigations shall be 
carried out bv the Commission, which may be assisted bv customs authorities, and shall be concluded 
within nine months. When the facts, as finally ascertained, justify the extension of measures, this shall 
be done bv the Council, acting bv simple majority and on a proposal from the Commission, from the date 
that registration was imposed under Article 14.5 or guarantees were requested. The relevant procedural 
provisions of this Regulation with regard to initiations and the conduct of investigations shall apply 
under this Article. 
13.4 Products shall not be subject to registration under Article 14.5 or measures where they are 
accompanied bv a customs certificate declaring that the importation of the goods does not constitute 
circumvention. Tliese certificates may be issued to importers, upon written application, bv the authorities 
following authorisation bv a decision of die Commission after consultation of the Advisory Committee 
or the decision of the Council imposing measures and they shall remain valid for the period, and under 
the conditions, set down therein. 
13.5 Nothing in this Article shall preclude the normal application of the provisions in force 
concerning customs duties. 
31 
Article 14 
General provisions 
14.1 Provisional or definitive anti-dumping duties shall be imposed by Regulation, and collected by 
Member States in the form, at the rate specified and according to the other criteria laid down in the 
Regulation imposing such duties. Such duties shall also be collected independently of the customs duties, 
taxes and other charges normally imposed on imports. No product shall be subject to both anti-dumping 
and countervailing duties for the purpose of dealing with one and the same situation arising from 
dumping or from export subsidisation. 
14.2 Regulations imposing provisional or definitive anti-dumping duties, or Regulations or Decisions 
accepting undertakings or terminating investigations or proceedings, shall be published in the Official 
Journal of the European Communities. Such Regulations or Decisions shall contain, in particular, and 
with due regard to the protection of confidential information, the names of the exporters, if practical, or 
countries involved, a description of the product and a summary of the material facts and considerations 
relevant to the dumping and injury detenrtinations. In each case, a copy of the Regulation or Decision 
shall be sent to known interested parties. The provisions of this paragraph shall apply mutatis mutandis 
to reviews. 
14.3 Special provisions, in particular with regard to the common definition of the concept of origin, as 
contained in Council Regulation (EEC) No 2913/92 of 12 October 1992. may be adopted in. or under. . 
this Regulation. 
14.4 In the Community interest, measures imposed under this Regulation may, after consultation of 
the Advisory Cornmittee. be suspended bv a decision of the Commission for a period of up to one year 
because of a change in market conditions in the Community which makes the application of such 
measures temporarily inappropriate, provided that the Community industry has been given an 
opportunity to comment. The suspension may be extended for a further period if the Council so decides, 
by simple majority, on a proposal from the Commission. Measures may, at any time and after 
consultation, be re-instated if the reason for suspension is no longer applicable. 
14.5 The Commission may, after consultation of the Advisory Committee, direct the customs 
authorities to take the appropriate steps to register imports, so that measures may subsequently be 
applied against these imports from the date of such registration. Imports may be made subject to 
registration following a request from the Community industry which contains sufficient evidence to 
justify such action. Registration shall be introduced bv Regulation which shall specify the purpose of the 
action and, if appropriate, the estimated amount of possible future liability. Imports may not be made 
subject to registration for a period longer than nine months. 
14.6 Member states shall report to the Commission, on a monthly basis, the import trade of products 
subject to investigation and subject to measures, and the amount of duties collected under this 
Regulation. 
32 
Article 15 
Consultations 
15.1 Any consultations provided for in this Regulation shall take place within an Advisory 
Cornmittee, which shall consist of representatives of each Member State, with a representative of the 
Commission as chairman. Consultations shall be held immediately on request by a Member State or on 
the initiative of the Commission and in any event within a timeframe which allows the time limits set 
by this Regulation to be respected. 
15.2 The Committee shall meet when convened by its chairman. He shall provide the Member States, 
as promptly as possible, with all relevant information. 
15.3 Where necessary, consultation may be in writing only; in such case the Commission shall notify 
the Member States and shall specify a period within which they shall be entitled to express their opinions 
or to request an oral consultation which the chairman shall arrange, provided that such oral 
consultation can be held within a timeframe which allows the time limits set by this Regulation to 
be respected. 
15.4 Consultation shall in particular cover: 
(i) the existence of dumping and the methods of establishing the dumping margin; 
(ii) the existence and extent of injury; 
(iii) the causal link between the dumped imports and injury; 
(iv) the measures which, in the circumstances, are appropriate to prevent or remedy the injury 
caused by dumping and the ways and means for putting such measures into effect. 
33 
Article 16 
Verification visits 
16.1 The Commission shall, where it considers it appropriate, carry out visits to examine the records 
of importers, exporters, traders, agents, producers, trade associations and organisations, to verify 
information provided on dumping and injury. In the absence of a proper and timely reply, a verification 
visit may not be carried out. 
16.2 The Commission may carry out investigations in third countries as required, provided it obtains 
the agreement of the firms concemed, it notifies the representatives of the government of the country in 
question and the latter does not object to the investigation. As soon as the agreement of the firms 
concemed has been obtained the Commission should notify the authorities of the exporting country of the 
names and addresses of the firms to be visited and the dates agreed. 
16.3 The firms concemed shall be advised of the nature of the information to be verified during 
verification visits and of any further information which needs to be provided during such visits, though 
this should not preclude requests to be made during the verification for further details to be provided in 
the light of information obtained. 
16.4 In investigations carried out under this paragraph, the Commission shall be assisted by officials 
of those Member States who so request. 
34 
Articled olo£s 
Sampling 
17.1 In cases where the number of complainants, exporters or importers, types of product or 
transactions is large, the investigation may be limited to a reasonable number of parties, products or 
transactions bv using samples which are statistically valid on the basis of information available at the 
time of the selection, or to the largest representative volume of production, sales or exports which can 
reasonably be investigated within the time available. 
17.2 The final selection of parties, types of products or transactions made under these sampling 
provisions shall rest with the Commission, though preference shall be given to choosing a sample in 
consultation with, and with the consent of, die parties concemed, provided such parties make themselves 
known and make sufficient information available, within three weeks of initiation, to enable a 
representative sample to be chosen. 
17.3 In cases where the examination has been limited in accordance with this Article, an individual 
margin of dumping shall, nevertheless, be calculated for any exporter or producer not initially selected 
who submits the necessary information within the time limits provided for in this Regulation, except 
where the number of exporters or producers is so large that mdividual examinations would be unduly 
burdensome and prevent the timely completion of the investigation. 
17.4 Where it is decided to sample and there is a degree of non-co-operation bv some or all of the 
parties selected which is likely to materially affect the outcome of the mvestigation. a new sample may 
be selected. However, if a material degree of non-co-operation persists or there is insufficient time to 
select a new sample, the relevant provisions of Article 18 shall apply. 
35 
oie r> 
Article 18 
Non-co-operation 
18.1 In cases in which any interested party refuses access to, or otherwise does not provide, necessary 
information within the time limits as provided for in this Regulation, or significantly impedes the 
investigation, provisional or final findings, affirmative or negative, may be made on the basis of the facts 
available. Where it is found that any interested party has supplied false or misleading information, the 
information shall be disregarded and use may be made of facts available. Interested parties should be 
made aware of the consequences of non-co-operation. 
18.2 A lack of a computerised response shall not be deemed to constitute non-co-operation, provided 
that the interested party shows that presenting the response as requested would result in an unreasonable 
extra burden or unreasonable additional cost. 
18.3 Where the information presented by an interested party may not be ideal in all respects it should 
not be disregarded, provided that any deficiencies are not such as to cause undue difficulty in arriving at 
a reasonably accurate finding and provided the information is appropriately submitted in timely fashion, 
it is verifiable and the party has acted to the best of its ability. 
18.4 If evidence or information is not accepted, the supplying party should be informed forthwith of 
the reasons therefor and should be granted an opportunity to provide further explanations within the time. 
limit specified. If the explanations are considered unsatisfactory, the reasons for rejection of such 
evidence or information should be disclosed and given in any published findings. 
18.5 If determinations, including those with respect to normal value, are based on the provisions of 
paragraph 1 of this Article, including the information supplied in the complaint, it should, where 
practicable and with due regard to the time limits of the mvestigation. be checked by reference to 
information from other independent sources which may be available, such as published price lists, 
official import statistics and customs returns, or information obtained from other interested parties 
during the investigation. 
18.6 If an interested party does not cooperate, or only cooperates partially, and thus relevant 
information is being withheld, the result could be less favourable to thé party than if it had cooperated. 
36 
2»^ Article 19 ' 
Confidentiality 
19.1 Any information which is by nature confidential, (for example, because its disclosure would be 
of significant competitive advantage to a competitor or because its disclosure would have a significantly 
adverse effect upon a person supplying the information or upon a person from whom he acquired the 
information) or which is provided on a confidential basis by parties to an investigation shall, upon good 
cause shown, be treated as such by the authorities. 
19.2 Interested parties providing confidential information shall be required to furnish non-confidential 
summaries thereof. These summaries shall be in sufficient detail to permit a reasonable understanding of 
the substance of the information submitted in confidence. In exceptional circumstances, such parties may 
indicate that such information is not susceptible of summary. In such exceptional circumstances, a 
statement of the reasons why summarisation is not possible must be provided. 
19.3 If it is considered that a request for œrifidentiality is not warranted and if the supplier of the 
information is either unwilling to make the information available or to authorise its disclosure in 
generalised or summary form, such information may be disregarded unless,it can be satisfactorily -
demonstrated from appropriate sources that the information is correct. Requests for confidentiality 
should not be arbitrarily rejected, 
19.4 This Article shall not preclude the disclosure of general information by the Community 
authorities and in particular of the reasons on which decisions taken pursuant to this Regulation are 
based, or disclosure of the evidence relied on by the Community authorities in so far as necessary to 
explain those reasons in court proceedings. Such disclosure must take into account the legitimate interest 
of the parties concerned that their business secrets should not be divulged. 
19.5 The Council, the Commission and Member States, or the officials of any of these, shall not 
reveal any information received pursuant to this Regulation for which confidential treatment has been 
requested by its supplier, without specific permission from the supplier. Exchanges of information 
between the Commission and Member States or any information relating to consultations made pursuant 
to Article 15 or any internal documents prepared by the authorities of the Community or its Member 
States shall not be divulged except as specifically provided for in this Regulation. 
19.6 Information received pursuant to this Regulation shall be used only for the purpose for which it 
was requested. 
37 
Article20 "^^ 
Disclosure 
20.1 The complainants, importers, exporters and representatives of the exporting country may request 
disclosure of the details underlying the essential facts and considerations, on the basis of which 
provisional measures have been imposed. Requests for such disclosure shall be made in writing 
immediately following the imposition of provisional measures and the disclosure shall be made in writing 
as soon as possible thereafter. 
20.2 The parties mentioned in paragraph 1, may request final disclosure of the essential facts and 
considerations, on the basis of which it is intended to recommend the imposition of definitive measures, 
or the termination of an investigation or proceedings without the imposition of measures, with particular 
attention being paid to the disclosure of any facts or considerations which are different from those used 
for any provisional measures. 
20.3 Requests for final disclosure, as defined in paragraph 2, shall be addressed to the Commission in 
writing and be received, in cases where a provisional duty has been applied, not later than one month 
after publication of the imposition of that duty. Where a provisional duty has not been applied, parties 
shall be provided with an opportunity to request final disclosure within time limits set by the 
Commission. 
20.4 Final disclosure shall be given in writing. It shall be made, with due regard paid to the protection 
of confidential information, as soon as possible and, normally, not later than one month prior to a 
definitive decision or the submission by the Commission of any proposal for final action pursuant to 
Article 9. Where the Commission is not in a position to disclose certain facts or considerations at that 
time, these shall be disclosed as soon as possible thereafter. Disclosure shall not prejudice any 
subsequent decision which may be taken bv the Commission or the Council but where such decision is 
based on any different facts and considerations, these shall be disclosed as soon as possible. 
20.5 Representations made after final disclosure is given shall be taken into consideration only if 
received within a period to be set by the Commission in each case, which shall be at least 10 days, due 
consideration being given to the urgency of the matter. 
38 
3 c 
Article 21 <*^ j. 
Community interest 
21.1 Under this Regulation, a determination as to whether the Community interest calls for 
intervention shall be based on an appreciation of all the various interests taken as a whole, including the 
interests of the domestic industry and users and consumers, and a determination under this Article shall 
only be made where all parties have been given the opportunity to make their views known under 
paragraph 2. In such an examination, the need to eliminate the trade distorting effects of injurious 
dumping and to restore effective competition shall be given special consideration. Measures, as 
determined on the basis of the dumping and injury found, may not be applied, where the authorities, on 
the basis of all the information submitted, can clearly conclude that it is not in the Community interest to 
apply such measures. 
21.2 In order to provide a sound basis on which the authorities can take account of all views and 
information in the decision on whether, or not, the imposition of measures is in the Communitv interest, 
the complainants, importers, representative users and representative consumer organisations may, within 
the time limits specified in the notice of initiation of the anti-dumping investigation, make themselves 
known and provide information to the Commission. Such information, or appropriate summaries thereof, 
shall be made available to the other parties specified in this Article, and they shall be entitled to respond 
to such information. 
21.3 The parties which have acted in conformity with paragraph 2 may request a hearing. Such 
requests may be granted when they are submitted within the time limits set in paragraph 2. and when 
they set out the particular reasons, in terms of the Communitv interest why the parties should be heard. 
21.4 The parties which have acted in conformity with paragraph 2. may provide comments on the 
application of any provisional duties imposed. Such comments shall be received within one month of the 
application of such measures if they are to be taken into account and they, or appropriate summaries 
thereof, shall be made available to other parties who shall be entitled to respond to such comments. 
21.5 The Commission shall examine the information which is properly submitted, and the extent to 
which it is representative, and the results of such analysis, together with an opinion on its merits, shall be 
transmitted to the Advisory Committee. The balance of views expressed in the Committee shall be taken 
into account bv the Commission in any proposal made under Article 9. 
21.6 The parties which have acted in conformity with paragraph 2. may request the facts and 
considerations on which final decisions are likely to be taken to be made available to them. Such 
information shall be made available to the extent possible and without prejudice to any subsequent 
decision taken bv the Commission or the Council. 
21.7 Under this Article, information shall only be taken into account where it is supported bv actual 
evidence which substantiates its validity. 
39 
Article 22 
Final provisions 
This Regulation shall not preclude the application of: 
(i) any special rules laid down in agreements concluded between the Community and third 
countries; 
(ii) the Community Regulations in the agricultural sector and of Regulation (EEC) No 1059/69 (^J. 
(EEC) No 2730/75 (6); and (EEC) No 2783/75 (7); this Regulation shall operate by way of complement 
to those Regulations and in derogation from any provisions thereof which preclude the application of 
anti-dumping duties; 
(iii) special measures, provided that such action does not run counter to obligations under the GATT. 
Article 23 
Repeal of existing legislation 
Regulation (EC) No 2423/88, as amended by Regulation (EC) No 521 and Regulation (EC) No 522, is 
hereby repealed. References to the repealed Regulation shall be construed as references to this 
Regulation. 
Article 24 
Entry into force 
This Regulation shall enter into force on the date determined by the decision on the entry into force of the 
acts implementing the results of the Uruguay Round. It shall apply to proceedings already initiated. 
However, the references to time limits for the initiation of proceedings and the imposition of provisional 
duties, shall only apply after a date which the Council shall specify in a Decision to be adopted by a 
qualified majority no later than 1 April 1995 on the basis of a Commission proposal to be submitted to 
the Council once the necessary budgetary resources have been made available. 
This Regulation shall be binding in its entirety and directly applicable in all Member States. 
Done at Brussels, 
5 OJNoL 141,12.06.1969, p. 1. 
6 OJ No L 281,01.11.1975, p. 20. 
7 OJNoL282,01.11.1975,p. 104. 
40 
•2o? 
Commercial defence 
Subsidies 
%s 
Explanatory memorandum 
A. INTRODUCTION 
The Uruguay Round trade negotiations, concluded in 1994, have led to the new 
Agreement on Subsidies and Countervailing Measures ("The Subsidies 
Agreement") which, as regards countervailing measures, is required to be 
implemented into Community legislation in order that, as agreed at Marrakech, it 
can come into effect on 1 January 1995. 
The Subsidies Agreement contains new and detailed rules on subsidies and 
countervailing duty investigations, and in view of the extent of the changes and 
to ensure an adequate and transparent implementation of the new rules, it is 
considered necessary to transpose the language of the Subsidies Agreement into 
Community legislation to the extent possible and for this purpose the Agreement, 
rather than the existing Community legislation, Regulation (EC) No 2423/88], has 
been taken as the basis for the proposed legislation. 
Additions to the Subsidies Agreement have been, for the most part, been restricted 
to : clarifications where the Agreement is unclear; incorporation of existing 
provisions on the EU's rather unique procedures and decision-making, amended to 
take account of Court judgements; and the amendment or incorporation of EU 
specific rules on issues such as negligible import volumes, sampling, non-
corporation, circumvention and Community interest, on which the Agreement is 
silent, imprecise or where it merely gives an indication of minima. On several 
issues, more detailed provisions from the new anti-dumping regulation are used in 
this regulation, where there is no conflict with the provisions of the Subsidies 
Agreement. 
OJ No L 209, 2.9.1988, p. 1. 
2i< 
The Subsidies Agreement sets new standards for the imposition of countervailing 
measures with its new and detailed rules on the definition of a subsidy, 
countervailability and calculation, its increased procedural requirements for 
initiation and subsequent investigation and its restrictions on the imposition of 
provisional duties. Its implementation into Community legislation will, of course, 
produce the same result. Moreover, the adoption of these new rules would,at the 
same time, improve legal certainty through greater precision, extend transparency 
and increase the rights of parties. 
In the same vein, some of the new rules, such as on negligible import volumes 
and Community interest, should further reinforce this effect of transparency and 
legal certainty. Community industries would have a clear idea of the minimum 
level of import volumes required both for complaints and final action. Moreover, 
all interested parties would be made aware of their rights and obligations with 
regard to the Community interest aspects of these cases, in that a structured 
framework would be provided for the provision and treatment of information by 
the authorities. 
Furthermore, it is important that measures, once taken, should be effective, and in 
this regard a new provision on circumvention has been added. 
Finally, it will be noted that this draft countervailing duty regulation is, for the 
first time, entirely separate from the proposed legislation on anti-dumping. This 
development is justified by the far more detailed nature of the new Subsidies 
Agreement, the increasingly distinct procedures with regard to CVD and anti­
dumping investigations, and the consequent need to give the CVD instrument 
greater autonomy. 
Sli 
B. MAIN FEATURES OF DRAFT COUNTERVAILING DUTY 
REGULATION 
1. Definition of a subsidy (Article 2) 
The definition of a subsidy reproduces literally that contained in the Subsidies 
Agreement, that is, a financial contribution by public authorities and a benefit to 
enterprises which is derived from such financial contribution. 
2. Notion of a countervailable subsidy (Article 3) 
The conditions for countervailability (or non-countervailability, as the case may 
be) also reproduce those of the Subsidies Agreement concerning specificity of 
subsidies and the green list, as well as the so-called "green box" contained in the 
Agreement on Agriculture. 
3. Calculation of the amount of a countervailable subsidy (Article 4) 
The provision on calculation of the amount of a countervailable subsidy espouses 
the principle of "benefit to the recipient". This approach is now permitted by 
Article 14 of the Subsidies Agreement, and will enhance the possibility of the 
Community using countervailing duty actions compared to the "cost to the 
government" approach. The "benefit to the recipient" approach is more in line 
with the methodology employed in state aid cases in the Community. 
1*VL-
4. Injury and Community industry (Articles 5 and 6) 
These provisions closely follow those of the Subsidies Agreement. 
5. Initiation of proceedings (Article 7) 
In addition to the basic criteria for initiating countervailing duty proceedings, 
Paragraphs 5-7 also set out the conditions under which investigations can be 
opened with regard to non-countervailable types of subsidy in order to determine 
whether the criteria for non-countervailability have been met. 
6. Conclusion of investigations (Article 8) 
The Subsidies Agreement provides that investigations should normally be 
concluded within 12 months, which conflicts with the 13 months envisaged for 
EU investigations from 1995 onwards. 
It is proposed to incorporate the provisions of the Agreement into this regulation 
(Article 8.9), although provisional duties would still have to be applied with 9 
months (Article 9.1). 
7. Undertakings (Article 10) 
(a) In countervailing duty investigations, undertakings may be. accepted from 
Governments or exporters. 
m 
(b) Over the years, there have been continual problems on what to do in cases where 
exporters have violated or withdrawn undertakings. In such circumstances, it is 
considered that the Community should be entitled to impose definitive duties based 
on the findings of the previous investigation, otherwise an exporter which is 
violating its undertaking could end up in a more advantageous position than its 
rivals which may be faithfully applying the undertakings. Moreover, carrying out a 
completely new investigation based on new facts is a time-consuming affair which 
should only be undertaken where the circumstances justify it. Violation does not 
appear to be one of these circumstances. 
The new provisions set out in Articles 10.9 and 10.10 of the draft text would 
permit the imposition of definitive duties in cases of proven violation or 
withdrawal though, of course, the exporter's rights would be safeguarded in that 
he would be entitled to ask for a review if the circumstances with regard to 
subsidization or injury have changed. Moreover, the change in measures would 
not generate a new 5 year "sunset" period. Where violation is only suspected, the 
remedy is a provisional duty while the matter is under investigation. 
8. Negligible import volumes and de minimis subsidy (Article 11). 
(a) This Regulation takes over the negligible import volumes for developing countries 
set out in the Subsidies Agreement. It also takes over the provision of the 
Agreement that a subsidy amount of less than 1% ad-valorem is de minimis. 
,^M 
(b) It is proposed not to define developing countries for the purpose of this 
Regulation.. 
9. Reviews and refunds (Article 13) 
(a) The provisions on reviews and refunds are broadly in line with those of the anti­
dumping regulation, with one exception. 
(b) As regards accelerated reviews for new exporters (Section C), the Subsidies 
Agreement is far less explicit than the Anti-Dumping Agreement on the question 
of new exporters. Article 19.3 states only that : 
"Any exporter whose exports are subject to a definitive countervailing duty but 
who was not actually investigated for reasons other than a refusal to co-operate, 
shall be entitled to an expedited review in order that the investigating authorities 
promptly establish an individual countervailing duty rate for that exporter. " 
IK 
There is no equivalent to the anti-dumping provisions which stipulate that the 
exporter must not have exported to the Community during the investigation 
period and must not be related to other exporters; neither is it stated that duties 
must not be collected during the review period. 
In these circumstances, it is proposed to maintain a text based on the Subsidies 
Agreement. 
10. Circumvention (Article 14) 
Anti-circumvention measures are not mentioned in the Subsidies Agreement, and 
the appropriateness of measures against the circumvention of countervailing 
duties has to be evaluated on the basis of certain specified conditions. It should 
also be considered that the circumvention of countervailing duties, which result 
from a subsidy granted by a Government, by exporters, is a particular situation, 
which needs to be analysed in its proper context. 
Therefore, the anti-circumvention provision of this regulation emphasises the 
possibility of taking measures to prevent circumvention of countervailing duties 
through practices, either assembly in third countries or the Community, for which 
there is insufficient due cause or economic justification other than the imposition 
of the duty. If the remedial effects of duties are undermined, measures may be 
taken, provided that the imported like product and/or parts still benefit from a 
countervailable subsidy. 
This provision provides a solid safeguard against circumvention of countervailing 
duties, and enables the Community to ensure that measures remain effective. 
The procedural part of the Article is in line with the anti-dumping regulation. 
2^ 
11. Sampling (Article 18) 
There are no specific provisions on sampling in the Subsidies Agreement. 
However, it is desirable to establish rules for sampling in countervailing duty 
cases, since the same problems of large numbers of exporters and importers which 
arise in anti-dumping investigations may also arise in countervailing duty 
proceedings. Therefore it is proposed to transpose the anti-dumping regulation's 
provisions on sampling into the countervailing duty regulation. 
12. Non-co-operation (Article 19) 
Article 12.7 of the Subsidies Agreement only contains the following brief 
reference to this issue : 
"In cases in which any interested Member or interested party refuses access to, or 
otherwise does not provide, necessary information within a reasonable period or 
significantly impedes the investigation, preliminary and final determinations, 
affirmative or negative, may be made on the basis of the facts available. " 
The same provision exists in the Anti-Dumping Agreement, but is supplemented 
by Annex II to that Agreement, which does not appear in the Subsidies 
Agreement. 
As regards the countervailing duty regulation, it is proposed to take over the anti­
dumping regulation's provisions on non-co-operation, given that these do not 
conflict with Subsidy Agreement's provision, but simply expand on it, and are 
aimed at greater transparency and predictability of the Community's actions on 
this issue. 
m 
13. Confidentiality (Article 20) 
Provisions on confidentiality are based on the provisions of the Subsidies 
Agreement, which are slightly different from those of the Anti-Dumping 
Agreement because of the direct involvement of Governments in countervailing 
duty proceedings, and therefore of the presence, in the record of an investigation, 
of government confidential, as well as business confidential, information. In 
particular, it will be specified that details of all bilateral consultations with 
Governments under the Subsidies Agreement are confidential. 
14. Simultaneous imposition of anti-dumping and countervailing duties (Article 
15.1) 
The basic provision of GATT Article VI:5 is included in the CVD regulation. 
15. Relationship between countervailing duty measures and multilateral 
remedies (Article 23) 
A provision has been inserted to permit withdrawal of countervailing duties in 
cases in which a multilateral subsidy action has been carried out (Panel) and 
measures other than countervailing duties have been taken as a consequence of 
such action (since countervailing duty investigations and GATT panels can be 
carried out in parallel, but only one type of remedy is allowed under the Subsidies 
Agreement). 
«MS 
16. Other 
It should be noted that the provisions on suspension of measures and registration 
of imports (Article 15) and Community interest (Article 22), are in line with the 
anti-dumping provisions, as are most of the procedural rules in this regulation 
which are not specifically referred to in this section. 
C. CONCLUSION 
In order to implement the 1994 Agreement on Subsidies and Countervailing 
Measures as concluded as a result of the Uruguay Round of multilateral trade 
negotiations, and to take account of the issues set out above, the Commission 
submits to the Council 
a proposal to replace the Community's basic countervailing duty legislation. 
10 
l'\c) 
PROPOSAL FOR : 
COUNCIL REGULATION (EC) N° /94 94/ 0231 (ACC) 
on protection against subsidised imports 
from countries not members of the European Community. 
The Council of the European Union 
Having regard to the Treaty establishing the European Community, and in particular 
Article 113 thereof, 
Having regard to the Regulations establishing the common organisation of agricultural 
markets and the Regulations adopted under Article 235 of the Treaty applicable to 
goods manufactured from agricultural products, and in particular the provisions of those 
Regulations which allow for derogation from the general principle that protective 
measures at frontiers may be replaced solely by the measures provided for in those 
Regulations, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas, by Regulation (EEC) N° 2423/880) , as amended by Regulation (EC) N° 
521/94(2) and Regulation (EC) N° 522/94(3) the Council adopted common rules for 
protection against dumped or subsidised imports from countries which are not members 
of the European Economic Community; 
0) O.J. L209, 2.8.1988, cJ. 
(2)O.J.L66, 16.3.1994, p. 7 
(3)O.J. L66, 16.3.1994, p. 10 
CA-xÀ-^s 
Whereas, these rules were adopted in accordance with existing international obligations, 
in particular those arising from Article VI of the General Agreement on Tariffs and 
Trade ("the GATT"), from the Agreement on Implementation of Article VI of the 
GATT ("the 1979 Anti-Dumping Code") and from the Agreement on Interpretation and 
Application of Articles VI, XVI and XXIII of the GATT ("the 1979 Subsidies Code"); 
Whereas, the conclusion of the Uruguay Round of multilateral trade negotiations has led 
to the establishment of the World Trade Organisation ("the WTO"); 
Whereas, Annex 1A to the Agreement establishing the WTO ("the WTO Agreement") 
contains, inter alia, the General Agreement on Tariffs and Trade 1994 ("the GATT 
1994"), an Agreement on Agriculture ("the Agreement on Agriculture"), a new 
Agreement on implementation of Article VI of the GATT 1,994 ("the Anti-Dumping 
Agreement"), and a new Agreement on Subsidies and Countervailing Measures ("the 
Subsidies Agreement"); 
Whereas, in order to reach greater transparency and effectiveness in the application by 
the Community of the rules laid down in respectively the Anti-Dumping Agreement and 
the Subsidies Agreement, it is considered necessary to adopt two separate Regulations 
which will lay down in sufficient detail the requirements for the application of each of 
these commercial defence instruments; 
Whereas, it is therefore appropriate to amend Community rules governing the 
application of countervailing measures in the light of the new multilateral rules, inter 
alia with regard to the procedures for initiation of proceedings and the conduct of 
subsequent investigations, including the establishment and treatment of the facts, the 
application of provisional measures, the imposition and collection of countervailing 
duties, the duration and review of countervailing measures, and the public disclosure of 
information relating to countervailing investigations; 
1 1 
Whereas, in view of the extent of the changes brought about by the new Agreements 
and to ensure an adequate and transparent implementation of the new rules, it is 
appropriate to transpose the' language of the new Agreements into Community 
legislation to the extent possible; 
Whereas, furthermore it seems advisable to explain, in adequate detail, when a subsidy 
shall be deemed to exist, according to which principles it shall be countervailable (in 
particular whether the subsidy has been granted specifically), and according to which 
criteria the amount of the countervailable subsidy shall be calculated; 
Whereas, it is clear that in determining the existence of a subsidy it is necessary to 
demonstrate that there has been a financial contribution by a government or any public 
authority within the territory of a country, or that there has been any form of income or 
price support in the sense of Article XVI of the GATT 1994, and that a benefit has 
thereby been conferred to the recipient enterprise; 
Whereas, it is necessary to explain in sufficient detail which kind of subsidies are not 
countervailable and which procedure shall be followed if during an investigation it is 
determined that an investigated enterprise has received non-countervailable subsidies; 
Whereas, the Subsidies Agreement states that the provisions concerning non-
countervailable subsidies shall cease to apply five years after the date of entry into force 
of the WTO Agreement, unless they are extended by mutual agreement of the Members 
of the WTO, and that it may therefore be necessary to amend this Regulation 
accordingly, if the validity of those provisions is not so extended; 
Whereas, the measures listed in Annex 2 to the Agreement on Agriculture are non-
countervailable, to the extent provided for in that Agreement; 
HZ 
Whereas, it is desirable to lay down clear and detailed guidance on the factors which 
may be relevant for the determination of whether the subsidised imports have caused 
material injury or are threatening to cause injury; and whereas, in demonstrating that the 
volume and price levels of the imports concerned are responsible for injury sustained by 
a Community industry, attention should be given to the effect of other factors and in 
particular existing market conditions in the Community; 
Whereas, it is advisable to define the term "Community industry" and provide that 
parties related to exporters may be excluded from such industry and to define the term 
"related"; and whereas it is also necessary to provide for countervailing duty action to be 
taken with regard to producers in a region of the Community and to lay down guidelines 
on the definition of such a region; 
Whereas, it is necessary to set down who may lodge a countervailing duty complaint, 
including the extent to which it sholilfi $fc supported by the Community industry, and 
the information on countervailable subsidies, injury and causality which such complaint 
should contain; and whereas it is also expedient to specify the procedures with regard to 
the rejection of complaints or the initiation of proceedings; 
Whereas, it is necessary to lay down how interested parties shall be given notice of the 
information which the authorities require, ample opportunity to present all relevant 
evidence and a full opportunity for the defence of their interests; whereas, it is also 
desirable to set out clearly the rules and procedures to be followed during the 
investigation, in particular that interested parties have to make themselves known, 
present their views and submit information within specified time limits, if such views 
and information are to be taken into account; and whereas it is also appropriate to set 
out the conditions under which an interested party may have access to, and comment on, 
information presented by other interested parties; whereas there should also be 
cooperation between the Member States and the Commission with regard to the 
collection of information; 
22 
Whereas, it is necessary to lay down the conditions under which provisional duties may 
be imposed, including that they may not be imposed sooner than 60 days from initiation 
and no later than 9 months from initiation; whereas, such duties may in all cases be 
imposed by the Commission only for a four month period; 
Whereas, it is necessary to specify procedures for the acceptance of undertakings which 
eliminate or offset the countervailable subsidies and injury instead of the imposition of 
provisional or definitive duties; whereas it is also appropriate to lay down the 
consequences of violation or withdrawal of undertakings and that provisional duties 
may be imposed in cases of suspected violation or where further investigation is 
necessary to complete the findings; whereas, in accepting undertakings, care should be 
taken that the proposed undertakings, and their enforcement, do not lead to anti­
competitive behaviour; 
Whereas, in order to reflect the provisions of tlie Subsidies Agreement, it is necessary to 
provide for the termination of cases, without or without measures, normally within 
twelve months, and in no case later than eighteen months from the initiation of the 
investigation; whereas, an investigation should be terminated in case the amount of the 
subsidy is found to be de minimis or if, particularly in case of imports originating in 
developing countries, the volume of subsidised imports or the injury is negligible, and it 
is appropriate to define these criteria; whereas, where measures are to be imposed, it is 
necessary to provide for the termination of investigations and to lay down that measures 
should be less than the amount of countervailable subsidies if such lesser amount would 
remove the injury, as well as to specify the method of calculating the level of measures 
in cases of sampling; 
20 
Whereas, it is necessary to provide for the retroactive collection of provisional duties as 
deemed appropriate and to define the circumstances which may trigger the retroactive 
application of duties to avoid the undermining of the definitive measures to be applied; 
whereas it is also necessary to provide that duties may be applied retroactively in cases 
of violation or withdrawal of undertakings; 
Whereas, it is necessary to provide that measures shall lapse after five years unless a 
review investigation indicates that they should be maintained; whereas, it is also 
necessary to provide, in cases where sufficient evidence is submitted of changed 
circumstances, for interim reviews or for investigations to determine whether refunds of 
countervailing duties are warranted; 
Whereas, even though the Subsidies Agreement does not contain provisions concerning 
circumvention of countervailing measures, the possibility of such circumvention exists, 
in terms similar, albeit not identical, to the circumvention of anti-dumping measures; 
whereas it appears therefore appropriate to enact an anti-circumvention provision in this 
Regulation; 
Whereas, it is expedient to permit the suspension of countervailing measures where 
there is a temporary change in market conditions which make the continued imposition 
of such measures temporarily inappropriate; 
Whereas, it is necessary to provide that imports under investigation may be made 
subject to registration upon importation to enable measures to be subsequently applied 
against such imports; 
Whereas, to ensure a proper enforcement of measures, it is necessary that Member 
States monitor and report to the Commission the import trade of products subject to 
investigation and subject to measures and the amount of duties collected under this 
regulation; 
tzç 
Whereas, it is necessary to provide for consultations of an Advisory Committee at 
regular and specified stages of the investigation; whereas the committee shall consist of 
representatives of Member States with a representative of the Commission as chairman; 
Whereas, it is expedient to provide for verification visits to check information submitted 
on countervailable subsidies and injury, though such visits should be dependent on 
proper replies to questionnaires being received; 
Whereas, it is essential to provide for sampling in cases where the number of parties or 
transactions are large in order to permit a timely completion of investigations; 
Whereas, it is necessary to provide that for parties who do not cooperate satisfactorily 
other information may be used to establish findings and such information may be less 
favourable to the party than if it had cooperated; 
Whereas, provision should be made for the treatment of confidential information so that 
business or governmental secrets are not divulged; 
Whereas, it is essential that provision is made for the proper disclosure of the essential 
facts and considerations to parties which qualify for such treatment and that such 
disclosure is made, with due regard to the decision-making process in the Community, 
within a time period which permits parties to defend their interests; 
Whereas, it is prudent to provide for an administrative system under which arguments 
can be presented in relation to whether measures are in the Community interest, 
including the interests of consumers, and to lay down the time periods within which 
such information has to be presented as well as the disclosure rights of the parties 
concerned; 
4% 
Whereas, it is imperative to link the implementation of time limits for the lodging of 
complaints, the initiation of proceedings and the imposition of provisional duties to the 
establishment of the necessary administrative structure within the Commission's 
services; whereas the Council, therefore, should specify, in a decision to be adopted by 
qualified majority no later than 1 April 1995, when these time limits shall apply; 
Whereas, in applying the rules of the Subsidies Agreement it is essential, in order to 
maintain the balance of rights and obligations which this Agreement sought to establish, 
that the Community take account of their interpretation by the Community's major 
trading partners, as reflected in legislation or established practice, 
HAS ADOPTED THIS REGULATION : 
21*3-
Article 1 
Principles 
1. This Regulation lays down provisions for protection against subsidised imports 
from countries not members of the European Community. A countervailing duty may be 
imposed for the purpose of offsetting any subsidy granted, directly or indirectly, for the 
manufacture, production, export or transport of any product whose release for free 
circulation in the Community causes injury. 
2. For the purpose of this Regulation, a product is considered as being subsidised if 
it benefits from a countervailable subsidy as defined in Articles 2 and 3 of this 
Regulation. 
3. Such subsidy may be granted by the Government of the country of origin of the 
imported product, or by the Government of an intermediate country from which the 
product is exported to the Community, known for the purpose of this Regulation as "the 
country of export". 
4. Notwithstanding the above, where products are not directly imported from the 
country of origin but are exported to the Community from an intermediate country, the 
provisions of this Regulation shall be fully applicable and the transaction or transactions 
shall, where appropriate, be regarded as having taken place between the country of 
origin and the Community. 
5. For the purpose of this Regulation the term "like product" shall be interpreted to 
mean a product which is identical, i.e. alike in all respects to the product under 
consideration, or in the absence of such a product, another product which although not 
alike in all respects, has characteristics closely resembling those of the product under 
consideration. 
1 1 \ 
Article 2 
Definition of a subsidy 
A subsidy shall be deemed to exist if: 
1. (a) there is a financial contribution by a government or any public body within 
the territory of the country of origin or export (hereinafter referred to as 
"government"), i.e. where: 
(i) a government practice involves a direct transfer of funds (e.g., grants, loans, 
and equity infusion), potential direct transfers of funds or liabilities (e.g., 
loan guarantees); 
(ii) government revenue that is otherwise due, is foregone or not collected (e.g., 
fiscal incentives such as tax credits); in this regard, the exemption of an 
exported product from duties or taxes borne by the like product when 
destined for domestic consumption, or the remission of such duties or taxes 
in amount not in excess of those which have been accrued, shall not be 
deemed to be a subsidy, provided that such an exemption is granted in 
accordance with the provisions of Annexes I-III to this Regulation; 
(iii) a government provides goods or services other than general infrastructure, 
or purchases goods; 
(iv) a government ' ' -
makes payments to a funding mechanism, or 
entrusts or directs a private body to carry out one or more of the type 
of functions illustrated in (i) to (iii) above which would normally be 
vested in the government, and 
10 
2-1S. 
the practice, in no real sense, differs from practices normally followed by 
governments; 
or 
(b) there is any form of income or price support in the sense of Article XVI of 
the GATT 1994, 
and 
2. a benefit is thereby conferred. 
11 
2^ 
Article 3 
Countervailability of subsidies 
A. PRINCIPLE 
1. Subsidies as defined by Article-2 shall be subject to countervailing measures only 
if they are specific, as defined in Paragraphs 2 to 4 below. 
B. SPECIFICITY 
2. In order to determine whether a subsidy, as defined in Article 2 above is specific 
to an enterprise or industry or group of enterprises or industries (hereinafter referred to 
as "certain enterprises") within the jurisdiction of the granting authority, the following 
principles shall apply: 
(a) Where the granting authority, or the legislation pursuant to which the 
granting authority operates, explicitly limits access to a subsidy to certain 
enterprises, such subsidy shall be specific. 
(b) Where the granting authority, or the legislation pursuant to which the 
granting authority operates, establishes objective criteria or conditions 
governing the eligibility for, and the amount of, a subsidy, specificity shall 
not exist, provided that the eligibility is automatic and that such criteria and 
conditions are strictly adhered to. 
For the purpose of this Article, objective criteria or conditions mean criteria 
or conditions which are neutral, which do not favour certain enterprises over 
others, and which are economic in nature and horizontal in application, such 
as number of employees or size of enterprise. 
12 
lyi 
The criteria or conditions must be clearly spelled out in law, regulation, or 
other official document, so as to be capable of verification. 
(c) If, notwithstanding any appearance of non-specificity resulting from the 
application of the principles laid down in subparagraphs (a) and (b) above, 
there are reasons to believe that the subsidy may in fact be specific, other 
factors may be considered. Such factors are: use of a subsidy programme by 
a limited number of certain enterprises, predominant use by certain 
enterprises, the granting of disproportionately large amounts of subsidy to 
certain enterprises, and the manner in which discretion has been exercised 
by the granting authority in the decision to grant a subsidy. In this regard, 
information on the frequency with which applications for a subsidy are 
refused or approved and the reasons for such decisions shall, in particular, 
be considered. 
In applying this provision, account shall be taken of the extent of 
diversification of economic activities within the jurisdiction of the granting 
authority, as well as of the length of time during which the subsidy 
programme has been in operation. 
3. A subsidy which is limited to certain enterprises located within a designated 
geographical region within the jurisdiction of the granting authority shall be specific. 
The setting or change of generally applicable tax rates by all levels of government 
entitled to do so shall not be deemed to be a specific subsidy for the purposes of this 
Regulation. 
4. Irrespective of the provisions of paragraphs 2 and 3 above, the following subsidies 
shall be deemed to be specific: 
(a) Subsidies contingent, in law or in fact, whether solely or as one of several 
other conditions, upon export performance, including those illustrated in 
Annex I to this Regulation. 
13 
l^ 
Subsidies shall be considered to be contingent in fact upon export 
performance when the facts demonstrate that the granting of a subsidy, 
without having been made legally contingent upon export performance, is in 
fact tied to actual or anticipated exportation or export earnings. The mere 
fact that a subsidy is accorded to enterprises which export shall not for that 
reason alone be considered to be an export subsidy within the meaning of 
this provision. 
(b) Subsidies contingent, whether solely or as one of several other conditions, 
upon the use of domestic over imported goods. 
5. Any determination of specificity under the provisions of this Article shall be 
clearly substantiated on the basis of positive evidence. 
C. NON-COUNTERVAILABLE SUBSIDIES 
6. The following subsidies shall not be subjected to countervailing measures: 
(a) Subsidies which are not specific within the meaning of paragraphs 2 and 3 
of this Article; 
(b) Subsidies which are specific, within the meaning of paragraphs 2 and 3 of 
this Article, but which meet the conditions provided for in paragraphs 7, 8 
or 9 below. 
(c) The element of subsidy which may exist in any of the measures listed in 
Annex IV to this Regulation. 
14 
B^ 
7. Subsidies for research activities conducted by firms or by higher education or 
research establishments on a contract basis with firms shall not be subject to 
countervailing measures, if the subsidies cover not more than 75 per cent of the costs of 
industrial research or 50 per cent of the costs of pre-competitive development activity, 
and provided that such subsidies are limited exclusively to: 
(i) personnel costs (researchers, technicians and other supporting staff employed 
exclusively in the research activity); 
(ii) costs of instruments, equipment, land and buildings used exclusively and 
permanently (except when disposed of on a commercial basis) for the research 
activity; 
(iii) costs of consultancy and equivalent services used exclusively for the research 
activity, including bought-in research, technical knowledge, patents, etc.; 
(iv) additional overhead costs incurred directly as a result of the research activity; 
(v) other running costs (such as those of materials, supplies and the like), incurred 
directly as a result of the research activity. 
For the purpose of this paragraph: 
(a) The allowable levels of non-countervailable subsidy referred to in this paragraph 
shall be established by reference to the total eligible costs incurred over the 
duration of an individual project. 
In case of programmes which span both "industrial research" and "pre-competitive 
development activity", the allowable level of non-countervailable subsidy shall 
not exceed the simple average of the allowable levels of non-countervailable 
subsidy applicable to the above two categories, calculated on the basis of all 
eligible costs as set forth in items (i)-(v) of this paragraph. 
15 
XVLl 
(b) The term "industrial research" means planned search or critical investigation 
aimed at discovery of new knowledge, with the objective that such knowledge 
may be useful in developing new products, processes or services, or in bringing 
about a significant improvement to existing products, processes or services. 
(c) The term "pre-competitive development activity" means the translation of 
industrial research findings into a plan, blueprint or design for new, modified or 
improved products, procteEsesH or services whether intended for sale or use, 
including the creation ofm; first prototype which would not be capable of 
commercial use. It may further include the conceptual formulation and design of 
products, processes or services alternatives and initial demonstration or pilot 
projects, provided that these same projects cannot be converted or.used for 
industrial application or commercial exploitation. It does not include routine or 
periodic alterations to existing products, production lines, manufacturing process, 
services, and other on-going operations even though those alterations may 
represent improvements. The provisions of this paragraph shall not apply to civil 
aircraft (as defined in the 1979 Agreement on Trade in Civil Aircraft, as amended, 
or in any later Agreement amending or replacing such Agreement). 
8. Subsidies to disadvantaged regions within the territory of the country of origin 
and/or export, given pursuant to a general framework of regional development, and 
which would be non-specific if the criteria laid down in paragraphs 2 and 3 of this 
Article were applied to each eligible region concerned, shall not be subject to 
countervailing measures provided that: 
(i) each disadvantaged region is a clearly designated contiguous geographical area 
with a definable economic and administrative identity; 
16 
&\ 
(ii) the region is considered as disadvantaged on the basis of neutral and objective 
criteria, indicating that the region's difficulties arise out of more than temporary 
circumstances; such criteria must be clearly spelled out in law, regulation, or other 
official document, so as to be capable of verification; 
(iii) the criteria include a measurement of economic development which shall be based 
on at least one of the following factors: 
one of either income per capita or hou^iold income per capita, or GDP per 
capita, which must not be above 85 per cent of the average for the territory 
of the country of origin or export concerned; 
unemployment rate, which must be at least 110 per cent of the average for 
the territory of the country of origin or export concerned; 
as measured over a three-year period: such measurement, however, may be a 
composite one and may include other factors. 
For the purpose of this paragraph : 
(a) A "general framework of regional development" means that regional subsidy 
programmes are part of an internally consistent and generally applicable regional 
development policy and that regional development subsidies are not granted in 
isolated geographical points having no, or virtually no influence on the 
development of a region. 
(b) "Neutral and objective criteria" means criteria which do not favour certain regions 
beyond what is appropriate for the elimination or reduction of regional disparities 
within the framework of the regional development policy. In this regard, regional 
subsidy programmes shall include ceilings on the amount of subsidy which can be 
granted to 
17 
ïtto 
each subsidised project. Such ceilings must be differentiated according to the 
different levels of development of eligible regions and must be expressed in terms 
of investment costs or the cost of job creation. Within such ceilings, the 
distribution of subsidy shall be sufficiently broad and even to avoid the 
predominant use of a subsidy by, or the granting of disproportionately large 
amounts of subsidy to, certain enterprises. This sub-paragraph shall be applied in 
the light of the criteria set out in paragraphs 2 and 3 of this Article. 
9. Subsidies to promote adaptation of existing facilities to new environmental 
requirements imposed by law ancj/or regulations which result in greater constraints and 
financial burden on firms, shall not be subject to countervailing measures, provided that 
the subsidy: 
(i) is a one-time non-recurring measure; and 
(ii) is limited to 20 per cent of the cost of adaptation; and 
(iii) does not cover the cost of replacing and operating the subsidised investment, 
which must be fully borne by firms; and 
(iv) is directly linked to and proportionate to a firm's planned reduction of nuisances 
and pollution, and does not cover any manufacturing cost savings which may be 
achieved; and 
(v) is available to all firms which can adopt the new equipment and/or production 
processes. 
For the purpose of this paragraph the term "existing facilities" means facilities having 
been in operation for at least two years at the time when new environmental 
requirements are imposed. 
18 
13} 
Article 4 
Calculation of the amount of the countervailable subsidy 
A. PRINCIPLE 
1. The amount of countervailable subsidies, for the purpose of this Regulation, shall 
be calculated in terms of the benefit conferred to the recipient which is found to exist 
during the investigation period for subsidisation. Normally this period shall be the most 
recent accounting year of the beneficiary, but may be any other period of at least six 
months prior to the initiation of the investigation for which reliable financial and other 
relevant data are available. 
B. CALCULATION OF BENEFIT TO THE RECIPIENT 
2. As regards the calculation of benefit to the recipient, the following rules shall 
apply: 
(a) Government provision of equity capital shall not be considered as conferring 
a benefit, unless the investment can be regarded as inconsistent with the 
usual investment practice (including for the provision of risk capital) of 
private investors in the territory of the country of origin and/or export. 
.(b) A loan by a government shall not be considered as conferring a benefit, 
unless there is a difference between the amount that the firm receiving the 
loan pays on the government loan and the amount that the firm would pay 
for a comparable commercial loan which the firm could actually obtain on 
the market. In this case the benefit shall be the difference between the two 
amounts. 
19 
2M 
(c) A loan guarantee by a government shall not be considered as conferring a 
benefit, unless there is a difference between the amount that the firm 
receiving the guarantee pays on a loan guaranteed by the government and 
the amount that the firm would pay for a comparable commercial loan 
absent the government guarantee. In this case the benefit shall be the 
difference between these two amounts adjusted for any differences in fees. 
(d) The provision of goods or services or purchases of goods by a government 
shall not be considered as-conferring a benefit unless the provision is made 
for less than adequate remuneration, or the purchase is made for more than 
adequate remuneration. The adequacy of remuneration shall be determined 
in relation to prevailing market conditions for the good or service in 
question in the country of provision or purchase (including price, quality, 
availability, marketability, transportation and other conditions of purchase 
or sale). 
C. GENERAL PROVISIONS ON CALCULATION 
3. The amount of countervailable subsidies shall be determined according to the 
following provisions 
(a) The amount of the countervailable subsidies shall be determined per unit of 
the subsidised product exported to the Community. 
(b) In establishing this amount the following elements may be deducted from 
the total subsidy: 
(i) any application fee, or other costs necessarily incurred in order to 
qualify for, or to obtain, the subsidy; 
20 
Xà5 
(ii) export taxes, duties or other charges levied on the export of the 
product to the Community specifically intended to offset the subsidy. 
Where an interested party claims a deduction, it must prove that the claim is 
justified. 
(c) Where the subsidy is not granted by reference to the quantities 
manufactured, produced, exported ?or transported, the amount of 
countervailable subsidy shall be determined by allocating the value of the 
total subsidy, as appropriate, over the level of production, sales or exports of 
the products concerned during the investigation period for subsidisation. 
(d) Where the subsidy can be linked to the acquisition or future acquisition of 
fixed assets, the amount of the countervailable subsidy shall be calculated 
by spreading the subsidy across a period which reflects the normal 
depreciation of such assets in the industry concerned. The amount so 
calculated which is attributable to the investigation period, inoiuding that 
which derives from fixed assets acquired before this period, shall be 
allocated as described in sub-paragraph 3(c). 
Where the assets are non-depreciating, the subsidy shall be valued as an 
interest-free loan, and be treated in accordance with paragraph 2(b) of this 
Article. 
(e) Where a subsidy cannot be linked to the acquisition of fixed assets, the 
amount of the benefit received during the investigation period shall in 
principle be attributed to this period, and allocated as described in sub­
paragraph 3(c), unless special circumstances arise justifying attribution over 
a different period. 
21 
llfC 
Article 5 
Determination of Injury 
1. Under this Regulation, the term "injury" shall, unless otherwise specified, be 
taken to mean material injury to the Community industry, threat of material injury to the 
Community industry or material retardation of the establishment of such an industry, 
and shall be interpreted in accordance with the provisions of this Article. 
2. A determination of injury shall be based on positive evidence and involve an 
objective examination of both (a) the volume of the subsidised imports and the effect of 
the subsidised imports on prices in the Community market for like products, and (b) the 
consequent impact of these imports on the Community industry. 
3. With regard to the volume of the subsidised imports, consideration shall be given 
as to whether there has been a significant increase in subsidised imports, either in 
absolute-terms or relative to production or consumption in the Community. With regard 
to the effect of the subsidised imports on prices, consideration shall be given as to 
whether there has been a significant price undercutting by the subsidised imports as 
compared with the price of a like product of the Community, or whether the effect of 
such imports is otherwise to depress prices to a significant degree or prevent price 
increases, which otherwise would have occurred, to a significant degree. No one or 
several of these factors can necessarily give decisive guidance. 
4. Where imports of a product from more than one country are simultaneously 
subject to countervailing duty investigations, the effects of such imports shall be 
cumulatively assessed only if it is determined that (1) the amount of countervailable 
subsidies established in relation 
22 
M 
to the imports from each country is more than de minimis as defined in paragraph 3 of 
Article 11 and that the volume of imports from each country is not negligible and (2) a 
cumulative assessment of the effects of the imports is appropriate in light of the 
conditions of competition between imported products and the conditions of competition 
between the imported products and the like Community product. 
5. The examination of the impact of the subsidised imports on the Community 
industry concerned shall include an evaluation of all relevant economic factors and 
indices having a bearing on the state of the industry, including: the fact that an industry 
is still in the process of recovering from the effects of past subsidisation or dumping, the 
magnitude of the amount of countervailable subsidies, actual and potential decline in 
sales, profits, output, market share, productivity, return on investments, utilisation of 
capacity; factors affecting Community prices; actual and potential negative effects on 
cash flow, inventories, employment, wages, growth, ability to raise capital or 
investments and, in the case of agriculture, whether there has been an increased burden 
on Government support programmes. This list is not exhaustive, nor can one or several 
of these factors necessarily give decisive guidance. 
6. It must be demonstrated, from all the relevant evidence presented in relation to 
paragraph 2, that the subsidised imports are causing injury within the meaning of this 
Regulation. Specifically, this shall entail a demonstration that the volume and/or price 
levels identified under paragraph 3 are responsible for an impact on the Community 
industry as provided for in paragraph 5, and that this impact exists to a degree which 
enables it to be classified as material. 
7. Known factors other than the subsidised imports which at the same time are 
injuring the Community industry shall also be examined to ensure that injury caused by 
these other factors is not attributed to the subsidised imports under paragraph 6. Factors 
which may be considered in this respect include, inter alia, the volume and prices of 
non-subsidised imports, contraction in demand or changes in the patterns of 
consumption, trade restrictive practices of and competition between the foreign and 
Community producers, developments in technology and the export performance and 
productivity of the Community industry. 
23 
lip. 
8. The effect of the subsidised imports shall be assessed in relation to the production 
of the Community industry of the like product when available data permit the separate 
identification of that production on the basis of such criteria as the production process, 
producers' sales and profits. If such separate identification of that production is not 
possible, the effects of the subsidised imports shall be assessed by the examination of 
the production of the narrowest group or range of products, which includes the like 
product, for which the necessary information can be provided. 
9. A determination of a threat of material injury shall be based on facts and not 
merely on allegation, conjecture or remote possibility. The change in circumstances 
which would create a situation in which the subsidy would cause injury must be clearly 
foreseen and imminent. 
10. In making a determination regarding the existence of a threat of material injury, 
consideration should be given to, inter alia, such factors as: 
(i) the nature of the subsidy or subsidies in question and the trade effects likely 
to arise therefrom; 
(ii) a significant rate of increase of subsidised imports into the Community 
market indicating the likelihood of substantially increased imports; 
(iii) sufficient freely disposable or an imminent, substantial increase in capacity 
of the exporter indicating the likelihood of substantially increased 
subsidised exports to the Community market, taking into account the 
availability of other export markets to absorb any additional exports; 
(iv) whether imports are entering at prices that would, to a significant degree, 
depress prices or prevent price increases which otherwise would have 
occurred, and would likely increase demand for further imports; and 
24 
ilfi 
(v) inventories of the product being investigated. 
11. No one of the factors listed above by itself can necessarily give decisive guidance 
but the totality of the factors considered must lead to the conclusion that further 
subsidised exports are imminent and that, unless protective action is taken, material 
injury would occur. 
25 
2-1,3 
Article 6 
Definition of Community Industry 
1. For the purposes of this Regulation, the term "Community industry" shall be 
interpreted as referring to the Community producers as a whole of the like product or to 
those of them whose collective output of the products constitutes a major proportion, as 
defined in paragraph 8 of Article 7, of the total Community production of those 
products, except that 
(i) when producers are related to the exporters or importers or are themselves 
importers of the allegedly subsidised product, the term "the Community 
industry" may be interpreted as referring to the rest of the producers; 
(ii) in exceptional circumstances the territory of the Community may, for the 
production in question, be divided into two or more competitive markets 
and the producers within each market may be regarded as a separate 
industry if (a) the producers within such market sell all or almost all of their 
production of the product in question in that market, and (b) the demand in 
that market is not to any substantial degree supplied by producers of the 
product in question located elsewhere in the Community. In such 
circumstances, injury may be found to exist even where a major proportion 
of the total Community industry is not injured, provided there is a 
concentration of subsidised imports into such an isolated market and 
provided further that the subsidised imports are causing injury to the 
producers of all or almost all of the production within such market. 
2. For the purpose of paragraph 1, producers shall be considered to be related to 
exporters or importers only if (a) one of them directly or indirectly controls the other; or 
(b) both of them are directly or indirectly controlled by a third person; or (c) together 
they directly or indirectly control a third person, provided that there are grounds for 
believing or suspecting 
26 
2^ 
that the effect of the relationship is such as to cause the producer concerned to behave 
differently from non-related producers. For the purpose of this paragraph, one shall be 
deemed to control another when the former is legally or operationally in a position to 
exercise restraint or direction over the latter. 
3. Where the Community industry has been interpreted as referring to the producers 
in a certain region, the exporters or the Government granting countervailable subsidies 
shall be given an opportunity to offer undertakings pursuant to Article 10 in respect of 
the region concerned. If an adequate undertaking is not offered promptly or the 
situations set out in paragraphs 9 and 10 of Article 10 apply, a provisional or definitive 
countervailing duty may be imposed in respect of the Community as a whole. In such 
cases the duties may, if practicable, be limited to specific products or exporters. 
4. The provisions of paragraph 8 of Article 5 shall apply to this Article. 
27 
2-l/A-
Article 7 
Initiation of proceedings 
1. Except as provided for in paragraph 10 of this Article, an investigation to 
determine the existence, degree and effect of any alleged subsidy shall be initiated upon 
a written complaint by any natural or legal person, or any association not having legal 
personality, acting on behalf of the Community industry. 
(i) The complaint may be submitted to the Commission, or a Member State, 
which shall forward it to the Commission. The Commission shall send 
Member States a copy of any complaint it receives. The complaint shall be 
deemed to have been lodged on the first working day following its delivery 
to the Commission by registered mail or the issuing of an acknowledgement 
of receipt by the Commission. 
(ii) Where, in the absence of any complaint, a Member State is in possession of 
sufficient evidence of subsidisation and of injury resulting therefrom for the 
Community industry, it shall immediately communicate such evidence to 
the Commission. 
2. A complaint under paragraph 1 shall include sufficient evidence of the existence 
of countervailable subsidies (including, if possible, of their amount), injury and a causal 
link between the allegedly subsidised imports and the alleged injury. The complaint 
shall contain such information as is reasonably available to the complainant on the 
following: 
(i) identity of the complainant and a description of the volume and value of the 
Community production of the like product by the complainant. Where a 
written complaint is made on behalf of the Community industry, the 
complaint shall identify the industry on behalf of which the complaint is 
made by a list of all 
28 
m, 
known Community producers of the like product (or associations of 
Community producers of the like product) and, to the extent possible, a 
description of the volume and value of Community production of the like 
product accounted for by such producers; 
(ii) a complete description of the allegedly subsidised product, the names of the 
country or countries of origin and/or export in question, the identity of each 
known exporter or foreign producer and a list of known persons importing 
the product in question; 
(iii) evidence with regard to the existence, amount, nature and countervailability 
of the subsidies in question; 
(iv) information on the evolution of the volume of the allegedly subsidised 
imports, the effect of these imports on prices of the like product in the 
Community market and the consequent impact of the imports on the 
Community industry, as demonstrated by relevant factors and indices 
having a bearing on the state of the Community industry, such as those 
listed in paragraphs 3 and 5 of Article 5. 
3. The Commission shall, to the degree possible, examine the accuracy and adequacy 
of the evidence provided in the complaint to determine whether there is sufficient 
evidence to justify the initiation of an investigation. 
4. An investigation may be initiated in order to determine whether or not the alleged 
subsidies are specific within the meaning of paragraphs 2 and 3 of Article 3 of this 
Regulation. 
5. An investigation may also be initiated in respect of subsidies non-countervailable 
according to paragraphs 7, 8 or 9 of Article 3 in order to determine whether or not the 
conditions laid down in those paragraphs have been met. 
29 
Ll<> 
6. If a subsidy is granted pursuant to a subsidy programme which has been notified 
in advance of its implementation to the WTO Committee on Subsidies and 
Countervailing Measures in accordance with the provisions of Article 8 of the Subsidies 
Agreement, and in respect of which the Committee has failed to determine that the 
relevant conditions laid down in Article 8 of the Subsidies Agreement have not been 
met, an investigation shall not be initiated in respect of a subsidy granted pursuant to 
such a programme, unless a violation of Article 8 of the Subsidies Agreement has been 
ascertained by the competent WTO Dispute Settlement Body or through arbitration as 
provided in paragraph 5 of Article 8 of the Subsidies Agreement. 
7. An investigation may also be initiated in respect of measures of the type listed in 
Annex IV to this Regulation, to the extent that they contain an element of subsidy as 
defined by Article 2, in order to determine whether the measures in question fully 
conform to the provisions of Annex IV. 
8. An investigation shall not be initiated pursuant to paragraph 1 unless it has been 
determined, on the basis of an examination of the degree of support for, or opposition 
to, the complaint expressed by Community producers of the like product, that the 
complaint has been made by or on behalf of the Community industry. The complaint 
shall be considered to have been made "by or on behalf of the Community industry" if it 
is supported by those Community producers whose collective output constitutes more 
than 50 per cent of the total production of the like product produced by that portion of 
the Community industry expressing either support for or opposition to the complaint. 
However, no investigation shall be initiated when Community producers expressly 
supporting the complaint account for less than 25 per cent of total production of the like 
product produced by the Community industry. 
30 
^u 
9. The Commission shall avoid, unless a decision has been made to initiate an 
investigation, any publicising of the complaint for the initiation of an investigation. 
However, as soon as possible after the receipt of a properly documented complaint 
under this Article, and in any event before the initiation of an investigation, the 
Commission shall notify the Government of the country of origin and/or export 
concerned, and this Government shall be invited for consultations with the aim of 
clarifying the situation as to matters referred to in Paragraph 2 above and arriving at a 
mutually agreed solution. 
10. If in special circumstances, the Commission decides to initiate an investigation 
without having received a written complaint by or on behalf of the Community industry 
for the initiation of such investigation, this shall be done on the basis of sufficient 
evidence of the existence of countervailable subsidies, injury and causal link, as 
described in paragraph 2, to justify the initiation of an investigation. 
11. The evidence of both subsidies and injury shall be considered simultaneously in 
the decision whether or not to initiate an investigation. A complaint shall be rejected 
where there is insufficient evidence of either countervailable subsidies or of injury to 
justify proceeding with the case. 
12. The complaint may be withdrawn prior to initiation, in which case it shall be 
considered not have been lodged. 
13. Where, after consultation, it is apparent that there is sufficient evidence to justify 
initiating proceedings the Commission shall initiate proceedings within one month of 
the lodging of the complaint and publish a notice in the Official Journal of the 
European Communities. Where insufficient evidence has been presented, the 
complainant shall, after consultation, be so informed within one month of the date on 
which the complaint is lodged with the Commission. 
31 
2l<5 
14. The notice of initiation of the proceeding shall announce the initiation of an 
investigation, indicate the product and countries concerned, give a summary of the 
information received and provide that all relevant information is to be communicated to 
the Commission; it shall state the periods within which interested parties may make 
themselves known, present their views in writing and submit information, if such views 
and information are to be taken into account during the investigation; it shall also state 
the period within which interested parties may apply to be heard by the Commission in 
accordance with paragraph 5 of Article 8. 
15. The Commission shall advise the exporters and importers known to it to be 
concerned, as well as the Government of the country of origin and/or export and the 
complainants, of the initiation of the proceedings and, with due regard to the protection 
of confidential information, provide the full text of the written complaint received under 
paragraph 1 to the known exporters, and to the authorities of the country of origin 
and/or export, and make it available, upon request, to other interested parties involved. 
Where the number of exporters involved is particularly high, the full text of the written 
complaint should instead be prov»8©# $nly to the authorities of the country of origin 
and/or export or to the relevant tradeassociation. 
16. A countervailing duty investigation shall not hinder the procedures of customs 
clearance. 
32 
^yi 
Article 8 
The investigation: information and procedure 
1. Following the initiation of the proceedings, the Commission, acting in co­
operation with the Member States, shall commence an investigation at Community 
level. Such investigation shall cover both subsidisation and injury and these shall be 
investigated simultaneously. For the purpose of a representative finding, an 
investigation period shall be selected which, in the case of subsidisation, shall normally 
cover the investigation period provided for in paragraph 1 of Article 4. Information 
relating to a period subsequent to the investigation period shall, normally, not be taken 
into account. 
2. Parties receiving questionnaires used in a countervailing duty investigation shall 
be given at least thirty days for reply. The time4imit for exporters shall be counted from 
the date of receipt of the questionnaire, which for this purpose shall be deemed to have 
been received one week from the day on^whâfflai it was sent to the respondent or 
transmitted to the appropriate diplomatic representative of the country of origin and/or 
export. An extension to the thirty day period may be granted, taking due account of the 
time limits of the investigation and provided the party gives a good reason, in terms of 
its particular circumstances, for such extension. 
3. The Commission may request Member States to supply information, and Member 
States shall take whatever steps are necessary in order to give effect to such requests. 
They shall send to the Commission the information requested together with the results 
of all inspections, checks or investigations carried out. Where this information is of 
general interest or where its transmission has been requested by a Member State, the 
Commission shall forward it to the Member States, provided it is not confidential, in 
which case a non-confidential summary shall be forwarded. 
33 
3S1 
4. The Commission may request Member States to carry out all necessary checks 
and inspections, particularly amongst importers, traders and Community producers, and 
to carry out investigations in third countries, provided the firms concerned give their 
consent and the government of the country in question has been officially notified and 
raises no objection. Member States shall take whatever steps are necessary in order to 
give effect to such requests from the Commission. Officials of the Commission shall be 
authorised, if the Commission or a Member State so requests, to assist the officials of 
Member States in carrying out their duties. 
5. The interested parties, which have made themselves known in accordance with 
paragraph 14 of Article 7, may be heard if they have, within the period prescribed in the 
notice published in the Official Journal of the European Communities, made a written 
request for a hearing showing that they are an interested party likely to be affected by 
the result of the proceedings and that there are particular reasons why they should be 
heard. 
6. Opportunities shall, on request, be provided for the importers, exporters and the 
complainants, which have made themselves known in accordance with paragraph 14 of 
Article 7, and the Government of the country of origin and/or export, to meet those 
parties with adverse interests, so that opposing views may be presented and rebuttal 
arguments offered. Provision of such opportunities must take account of the need to 
preserve confidentiality and of the convenience to the parties. There shall be no 
obligation on any party to attend a meeting, and failure to do so shall not be prejudicial 
to that party's case. Oral information provided under this Paragraph shall be taken into 
account by the Commission in so far as it is subsequently reproduced in writing. 
7. The complainants, the Government of the country of origin and/or export, 
importers, exporters, users and consumer organisations, which have made themselves 
known in accordance with paragraph 14 of Article 7, may, upon written request, inspect 
all information made available to the Commission by any party to an investigation, as 
distinct from internal 
34 
^>ï 
documents prepared by the authorities of the Community or its Member States, 
provided that it is relevant to the defence of their interests and not confidential within 
the meaning of Article 20, and that it is used in the investigation. Such parties may 
respond to such information and their comments may be taken into consideration, to the 
extent that they are sufficiently substantiated in the response. 
8. Except in circumstances provided for in Article 19, the information supplied by 
interested parties and upon which findings are based, shall be examined for accuracy to 
the degree possible. 
9. Investigations shall, except in special circumstances, be concluded within one 
year, and in no case more than 18 months, after their initiation. 
10. Throughout the investigation, the Commission shall afford the Government of the 
country of origin and/or export a reasonable opportunity to continue consultations, with 
a view to clarifying the factual situation and arriving at a mutually agreed solution. 
35 
2i"i 
Article 9 
Provisional measures 
1. Provisional measures may be applied if proceedings have been initiated in 
accordance with the provisions of Article 7, a public notice has been given to that effect 
and interested parties have been given adequate opportunities to submit information and 
make comments in accordance with paragraph 14 of Article 7, a provisional affirmative 
determination has been made that the imported product benefits from countervailable 
subsidies and of consequent injury to the Community industry, and the Community 
interest calls for intervention to prevent such injury. The provisional measures shall be 
imposed no sooner than 60 days from the initiation of the proceedings but no later than 
nine months from the initiation of the proceedings. 
2. The amount of the provisional countervailing duty shall not exceed the total 
amount of countervailable subsidies as provisionally established but it should be less 
than this amount, if such lesser duty would be adequate to remove the injury to the 
Community industry. 
3. Provisional measures shall take the form of a security and the release of the 
products concerned for free circulation in the Community shall be conditional upon the 
provision of such security. 
4. The Commission shall take provisional action after consultation or, in cases of 
extreme urgency, after informing the Member States. In this latter case, consultations 
shall take place 10 days, at the latest, after notification to the Member States of the 
action taken by the Commission. 
5. Where à Member State requests immediate intervention by the Commission and 
the conditions of paragraph 1 of Article 9 are met, the Commission shall, within a 
maximum of five working days of receipt of the request, decide whether a provisional 
countervailing duty should be imposed. 
36 
^ 
6. The Commission shall forthwith inform the Council and the Member States of any 
decision taken under this Article. The Council, acting by qualified majority, may decide 
differently. 
7. Provisional countervailing duties shall have a maximum period of validity of four 
months. 
,iJOW y'JiJ 
37 
2sr 
Article 10 
Undertakings 
1. Investigations may be terminated! without the imposition of provisional or 
definitive duties upon acceptance of satisfactory voluntary undertakings under which 
(i) the Government of the country of origin and/or export agrees to eliminate or 
limit the subsidy or take other measures concerning its effects; or 
(ii) any exporter undertakes to revise its prices or to cease exports to the area in 
question as long as such exports benefit from countervailable subsidies, so 
that the Commission, after consultation, is satisfied that the injurious effect 
of the subsidies is eliminated. Price increases under such undertakings shall 
not be higher than necessary to offset the amount of countervailable 
subsidies, and should be less than the amount of countervailable subsidies if 
such increases would be adequate to remove the injury to the Community 
industry. 
2. Undertakings may be suggested by the Commission, but no Government or 
exporter shall be obliged to enter into such an undertaking. The fact that Governments 
or exporters do not offer such undertakings, or do not accept an invitation to do so, shall 
in no way prejudice the consideration of the case. However, it may be determined that a 
threat of injury is more likely to be realised if the subsidised imports continue. 
Undertakings shall not be sought or accepted from Governments or exporters unless a 
provisional affirmative determination of subsidisation and injury caused by such 
subsidisation has been made. Save in exceptional circumstances, undertakings may not 
be offered later than the end of the period during which representations may be made 
under Paragraph 5 of Article 21. 
38 
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3. Undertakings offered need not be accepted if their acceptance is considered 
impractical, for example, if the number of actual or potential exporters is too great, or 
for other reasons, including reasons of general policy. The exporter and/or the 
Government of the country of origin and/or export concerned may be provided with the 
basis on which it is intended to propose the rejection of the offer of an undertaking and 
may be given an opportunity to make comments thereon. The reasons for rejection shall 
be set out in the definitive decision. 
4. Parties which offer an undertaking shall be required to provide a non-confidential 
version of such undertaking, so that it may be made available to interested parties to the 
investigation. 
5. Where undertakings are, after consultation, accepted, and there is no objection 
raised within the Advisory Committee, the investigation shall be terminated. In all other 
cases, the Commission shall submit to the Council forthwith a report on the results of 
the consultation, together with a proposal that the proceedings be terminated. The 
proceedings shall stand terminated if, within one month, the Council, acting by qualified 
majority, has not decided otherwise. 
6. If the undertakings are accepted, the investigation of subsidisation and injury shall 
normally be completed. In such a case, if a negative determination of subsidisation or 
injury is made, the undertaking shall automatically lapse except in cases where such a 
determination is due in large part to the existence of an undertaking. In such cases, the 
authorities may require that an undertaking be maintained for a reasonable period. In 
the event that an affirmative determination of subsidisation and injury is made, the 
undertaking shall continue consistent with its terms and the provisions of this 
Regulation. 
7. The Commission shall require any Government or exporter from whom 
undertakings have been accepted to provide, periodically, information relevant to the 
fulfilment of such undertaking, and to permit verification of pertinent data. Non­
compliance with such requirements shall be construed as a violation of the undertaking. 
39 
<ZÏ\ 
8. Where undertakings are accepted from certain exporters during the course of an 
investigation, they shall, for the purpose of Article 13, deemed to take effect from the 
date on which the investigation is concluded for the country of origin and/or export. 
9. In case of violation or withdrawal of undertakings by any party , a definitive duty 
shall be imposed in accordance with Article 11, on the basis of the facts established 
within the context of the investigation which led to the undertaking, provided that such 
investigation was concluded with a final determination on subsidisation and injury, and 
the exporter concerned, or the Government of the country of origin and/or export, 
except in the case of withdrawal of undertakings by the exporter or such Government, 
has been given an opportunity to comment. 
10. A provisional duty may, after consultation, be imposed in accordance with Article 
9 on the basis of the best information available, where there is reason to believe that an 
undertaking is being violated, or in case of violation or withdrawal of undertakings 
where the investigation which led to the undertaking was not concluded. 
40 
a il 
Article 11 
Termination without measures and imposition of definitive duties 
1. Where the complaint is be withdrawn, proceedings may be terminated unless such 
termination would not be in the Community interest. 
2. Where, after consultation, protective measures are unnecessary and there is no 
objection raised within the Advisory Committee, the investigation or proceedings shall be 
terminated. In all other cases, the Commission shall submit to the Council forthwith a 
report on the results of the consultation, together with a proposal that the proceedings be 
terminated. The proceedings shall stand terminated if, within one month, the Council, 
acting by a qualified majority, has not decided otherwise. 
3. Subject to and in accordance with the provisions of paragraphs 4 and 5 below, 
there shall be immediate termination of the proceedings where it is determined that the 
amount of countervailable subsidies is de minimis, or where the volume of subsidised 
imports, actual or potential, or the injury, is negligible. 
4. With regard to investigations concerning imports from developing countries, the 
volume of subsidised imports shall be considered negligible if it represents less than 4 per 
cent of the total imports of the like product in the Community, unless imports from 
developing countries whose individual shares of total imports represent less than 4 per 
cent collectively account for more than 9 per cent of the total imports of the like product 
in the Community. 
41 
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5. For the same investigations, the amount of the countervailable subsidies shall be 
considered to be de minimis if such amount is less than 1 per cent ad valorem, except 
that 
(a) as regards investigations concerning imports from developing countries the 
de minimis threshold shall be 2% ad valorem; and 
(b) for those developing countries Members of the WTO referred to in Annex 
VII of the Subsidies Agreement as well as for developing countries 
Members of the WTO which have completely eliminated export subsidies as 
defined in paragraph 4(a) of Article 3 of this Regulation, the de minimis 
subsidy threshold shall be 3 per cent ad valorem; where the application of 
this provision depends on the elimination of export subsidies, it shall apply 
from the date that the elimination of export subsidies is notified to the WTO 
Committee on Subsidies and Countervailing Measures, and for so long as 
export subsidies are not granted by the developing country concerned; this 
provision shall expire eight years from the date of entry into force of the 
WTO Agreement; 
provided that it is only the investigation that shall be terminated where the amount of 
the countervailable subsidies is below the relevant de minimis level for individual 
exporters and they shall remain subject to the proceedings and may be re-investigated in 
any subsequent review carried out for the country concerned under Article 13. 
6. Where the facts as finally established show the existence of countervailable 
subsidies and injury caused thereby, and the Community interest calls for intervention 
in accordance with Article 22, a definitive countervailing duty shall be imposed by the 
Council, acting by simple majority on a proposal submitted by the Commission after 
consultation of the Advisory Committee, unless the subsidy or subsidies are withdrawn 
or it has been demonstrated that the subsidies no longer confer any benefit to the 
exporters involved. Where provisional duties are in force, a proposal for definitive 
action shall be submitted to the Council not later than one month before the expiry of 
such duties. The amount of the countervailing duty shall not exceed the amount of 
countervailable subsidies from which the exporters have been found to benefit, 
established under this Regulation, but should be less than the total amount of 
countervailable subsidies, if such lesser duty would be adequate to remove the injury to 
the Community industry. 
42 
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7. A countervailing duty shall be imposed in the appropriate amounts in each case, 
on a non-discriminatory basis, on imports of a product from all sources found to benefit 
from countervailable subsidies and causing injury, except as to imports from those 
sources from which undertakings under the terms of this Regulation have been accepted. 
The Regulation shall specify the duty for each supplier, or, if that is impracticable, the 
supplying country concerned. 
8. When the Commission has limited its examination in accordance with Article 18, 
any countervailing duty applied to imports from exporters or producers which have 
made themselves known in accordance with Article 18 but were not included in the 
examination shall not exceed the weighted average amount of countervailable subsidies 
established for the parties in the sample. For the purpose of this paragraph, the 
Commission shall disregard any zero and de minimis amounts of countervailable 
subsidies, and amounts of countervailable subsidies established under the circumstances 
referred to in Article 19. The authorities shall apply individual duties to imports from 
any exporter or producer which is granted individual treatment, as provided for in 
Article 18. 
43 
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Article 12 
Retroactivity 
1. Provisional measures and definitive countervailing duties shall only be applied to 
products which enter for consumption after the time when the decision taken under 
Paragraph 1 of Article 9 and Paragraph 7 of Article 11, respectively, enters into force, 
subject to the exceptions set out in this Regulation. 
2. Where a provisional duty has been applied and the facts as finally established 
show the existence of countervailable subsidies and injury, the Council shall decide, 
irrespective of whether a definitive countervailing duty is to be imposed, what 
proportion of the provisional duty is to be definitively collected. For this purpose, 
'injury' shall not include material retardation of the establishment of a Community 
industry, nor threat of material injury, except where it is found that this would, in the 
absence of provisional measures, have developed into material injury. In all other cases 
involving such threat or retardation, any provisional amounts shall be released and 
definitive duties can only be imposed from the date that a final determination of threat 
or material retardation is made. 
3. If the definitive countervailing duty is higher than the provisional duty, the 
difference shall not be collected. If the definitive duty is lower than the provisional duty, 
the duty shall be recalculated. Where a final deterrnination is negative, the provisional 
duty shall not be confirmed. 
44 
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4. A definitive countervailing duty may be levied on products which were entered 
for consumption not more than 90 days prior to the date of application of provisional 
measures but not prior to the initiation of the investigation, provided that the imports 
have been registered in accordance with paragraph 5 of Article 15, the importers 
concerned have been given an opportunity to comment by the Commission, and that it is 
found that: 
(i) there exist critical circumstances where for the subsidised product in 
question injury which is difficult to repair is caused by massive imports in a 
relatively short period of a product benefiting from countervailable 
subsidies under the terms of this Regulation; and, 
(ii) where it is deemed necessary, in order to preclude the recurrence of such 
.injury, to assess countervailing duties retroactively on those imports. 
5. In cases of violation or withdrawal of undertakings, definitive duties may be 
levied in accordance with this Regulation on goods entered for consumption not more 
than ninety days before the application of provisional measures, provided than the 
imports have been registered in accordance with paragraph 5 of Article 15, and that any 
such retroactive assessment shall not apply to imports entered before the violation or 
withdrawal of the undertaking. 
45 
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Article 13 
Duration, reviews and refunds 
1. A countervailing measure shall remain in force only as long as and to the extent 
necessary to counteract the countervailable subsidies which are causing injury. 
A. Expiry reviews 
2. A definitive countervailing measure shall expire five years from its imposition or 
five years from the date of the most recent review which has covered both subsidisation 
and injury, unless it is determined in a review that the expiry would be likely to lead to 
continuation or recurrence of subsidisation and injury. Such an expiry review shall be 
initiated on the initiative of the Commission, or upon a request made by or on behalf of 
the Community producers and the measure shall remain in force pending the outcome of 
such review. 
3. An expiry review shall by initiated where the request contains sufficient evidence 
that the removal of measures would be likely to result in a continuation or recurrence of 
subsidisation and injury. Such a likelihood may, for example, be indicated by evidence 
of continued subsidisation and injury or evidence that the removal of injury is partly or 
solely due to the existence of measures or evidence that the circumstances of the 
exporters, or market conditions, are such that they would indicate the likelihood of 
further injurious subsidisation. 
4. In carrying out investigations under this section, the exporters, importers, the 
Government of the country of origin and/or export and the complainants shall be 
provided with* the opportunity to amplify, rebut or comment on the matters set out in the 
review request and conclusions shall be reached with due account taken of all relevant 
and duly supported evidence presented in relation to the question of whether the 
removal of measures would be likely, or unlikely, to lead to the continuation or 
recurrence of subsidisation and injury. 
46 
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5. Under this section, a notice of impending expiry shall be published in the Official 
Journal of the European Communities at an appropriate time as defined in this 
paragraph in the final year of the period of application of the measures. Thereafter, the 
Community producers shall, no later than three months before the end of the five year 
period, be entitled to lodge a review request in accordance with paragraph 3. A notice 
announcing the actual expiry of measures under this section shall also be published. 
B. Interim reviews 
6. The need for the continued imposition of measures may also be reviewed, where 
warranted on the initiative of the Commission or at the request of a Member State or, 
provided that a reasonable period of time of at least 1 year has elapsed since the 
imposition of the definitive measure, upon a request by any exporter, importer or the 
Community producers or the Government of the country of origin and/or export which 
contains sufficient evidence substantiating the need for such an interim review. 
7. An interim review shall be initiated where the request contains sufficient evidence 
that the continued imposition of the measure is no longer necessary to offset the 
countervailable subsidy and/or the injury would be unlikely to continue or recur if the 
measure were removed or varied, or that the existing measure is not, or is no longer, 
sufficient to counteract the countervailable subsidy which is causing injury. 
8. Where countervailing duties have been imposed in accordance with paragraph 7 of 
Article 11, an interim review shall be initiated if the Community producers provide 
sufficient evidence that the duties have led to no movement or insufficient movement of 
resale prices of the imported product in the Community. If the investigation proves the 
allegations to be correct, countervailing duties may be increased to achieve the price 
increase required to remove injury, although the increased duty level shall not exceed 
the amount of the countervailable subsidies. 
47 
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9. In carrying out investigations under this section, the Commission may, inter alia, 
consider whether the circumstances with regard to subsidisation and injury have 
changed significantly, or whether existing measures are achieving the intended results in 
removing the injury previously established in accordance with Article 5 of this 
Regulation. In these respects, account shall be taken of all relevant and duly supported 
evidence in the final determination. 
C. Accelerated reviews 
10. Any exporter whose exports are subject to a definitive countervailing duty but 
who was not individually investigated during the original investigation for reasons other 
than a refusal to co-operate with the Commission, shall be entitled, upon request, to an 
accelerated review in order that the Commission promptly establish an individual 
countervailing duty rate for that exporter. Such a review shall be initiated after 
consultation of the Advisory Committee and Community producers have been given an 
opportunity to comment. 
D. General provisions on reviews 
11. The relevant provisions of Article 7 and Article 8, excluding those relating to time 
limits, shall apply to any review carried out under sections A, B and C of this Article. 
Any such review shall be carried out expeditiously and shall normally be concluded 
within twelve months of the date of initiation of the review. 
12. Reviews under this Article shall be initiated by the Commission after consultation 
of the Advisory Committee. Where warranted by reviews, measures shall be repealed or 
maintained under section A, or repealed, maintained or amended under sections B and 
C, by the Community institution responsible for their introduction. Where measures are 
repealed for individual exporters, but not for the country as a whole, such exporters 
shall remain subject to the proceedings and may be re-investigated in any subsequent 
review carried out for that country under this Article. 
48 
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13. Where a review of measures under section B is in progress at the end of the period 
of application of measures as defined in section A, the measures shall also be 
investigated under the provisions of section A. 
E. Refunds 
14. Notwithstanding section A, an importer may request reimbursement of duties 
collected where it is shown that the amount of countervailable subsidies, on the basis of 
which duties were paid, has been eliminated, or reduced to a level which is below the 
level of the duty in force. 
15. In order to request a refund of countervailing duties, the importer shall submit an 
application to the Commission. The application shall be submitted via the Member State 
in the territory of which the products were released for free circulation and within six 
months of the date on which the amount of the definitive duties to be levied was duly 
determined by the competent authorities or of the date on which a decision was made 
definitively to collect the amounts secured by way of provisional duty. Member States 
shall forward the request to the Commission forthwith. 
16. An application for refund shall only be considered to be duly supported by 
evidence where it contains precise information on the amount of refund of 
countervailing duties claimed and all customs documentation relating to the calculation 
and payment of such amount. It shall also include evidence, for a representative period, 
on the amount of countervailable subsidies for the exporter or producer to which the 
duty applies. In cases where the importer is not associated to the exporter or producer 
concerned and such 
49 
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information is not immediately available or the exporter or producer is unwilling to 
release it to the importer, the application shall contain a statement from the exporter or 
producer that the amount of countervailable subsidies has been reduced or eliminated, as 
specified in this Article, and that the relevant supporting evidence shall be provided to 
the Commission. It shall be understood that where such evidence is not forthcoming 
from the exporter or producer, within a reasonable period of time, the application shall 
be rejected. 
17. The Commission shall, after consultation of the Advisory Committee, decide 
whether and to what extent the application should be granted or it may decide at any 
time to initiate an interim review and the information and findings from such review, 
carried out in accordance with the provisions applicable for such reviews, shall be used 
to determine whether and to what extent a refund is justified. Refunds of duties shall 
normally take place within 12 months, and in no case more than 18 months after the 
date on which a request for a refund, duly supported by evidence, has been made by an 
importer of the product subject to the countervailing duty. The payment of any refund 
authorised should normally be made by Member States within 90 days of the above-
noted decision. 
F. Final provision 
18. In all review or refund investigations carried out under this Article, the 
Commission shall apply, in so far as circumstances have not changed, the same 
methodology as in the investigation which led to the duty, with due account taken of the 
provisions set out in Article 4 and Article 18 of this Regulation. 
50 
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Article 14 
Circumvention 
1. Countervailing duties imposed under this Regulation may be extended to apply to 
imports from third countries of like products, or parts thereof, when circumvention of 
the measures in force is taking place. Circumvention shall be defined as a change in the 
pattern of trade between third countries and the Community which stems from a 
practice, process or work for which there is insufficient due cause or economic 
justification, other than the imposition of the duty, and there is evidence that the 
remedial effects of the duty are being undermined, in terms of the prices and/or 
quantities of the assembled like product, and the imported like product and/or parts 
thereof still benefit from the subsidy. 
2. Investigations shall be initiated under this Article where the request contains 
sufficient evidence on the factors set out in paragraph 1. Initiations shall be made, after 
consultation of the Advisory Committee, by Commission Regulation which shall also 
instruct the customs authorities to make imports subject to registration in accordance 
with Paragraph 5 of Article 15 or request guarantees.. Investigations shall be carried out 
by the Commission, which may be assisted by customs authorities, and shall be 
concluded within nine months. When the facts, as finally ascertained, justify the 
extension of measures, this shall be done by the Council, acting by simple majority and 
on a proposal from the Commission, from the date that registration was imposed under 
Paragraph 5 of Article 15 or guarantees were requested. The relevant procedural 
provisions of this Regulation with regard to initiations and the conduct of investigations 
shall apply under this Article. 
3. Products shall not be subject to registration under Paragraph 5 of Article 15 or 
measures where they are accompanied by a customs certificate declaring that the 
importation of the goods does not constitute circumvention. These certificates may be 
issued to importers, upon written application, by the authorities following authorisation 
by a decision of the Commission after consultation of the Advisory Committee or the 
decision of the Council imposing measures and they shall remain valid for the period, 
and under the conditions, set down therein. 
51 
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4. Nothing in this Article shall preclude the normal application of the provisions in 
force concerning customs duties. 
52 
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Article 15 
General provisions 
1. Provisional or definitive countervailing duties shall be imposed by Regulation, 
and collected by Member States in the form, at the rate specified and according to the 
other criteria laid down in the Regulation imposing such duties. Such duties shall also 
be collected independently of the customs duties, taxes and other charges normally 
imposed on imports. No product shall be subject to both anti-dumping and 
countervailing duties to compensate for the same situation arising from dumping or 
export subsidisation. 
2. Regulations imposing provisional or definitive countervailing duties, or 
Regulations or Decisions accepting undertakings or terminating investigations or 
proceedings, shall be published in the Official Journal of the European Communities. 
Such Regulations or Decisions shall contain, in particular, and with due regard to the 
protection of confidential information the names of the exporters, if practical, or 
countries involved, a description of the product and a summary the facts and 
considerations relevant to the countervailable subsidies and injury determinations. In 
each case, a copy of the Regulation or Decision shall be sent to known interested 
parties. The provisions of this paragraph shall apply mutatis mutandis to reviews. 
3. Special provisions, in particular with regard to the common definition of the 
concept of origin, as contained in Council Regulation (EEC) No 2913/92 of 12 October 
1992, may be adopted in, or under, this Regulation. 
4. In the Community interest, measures imposed under this Regulation may, after 
consultation of the Advisory Committee, be suspended by a decision of the Commission 
for a period of up to one year because of a change in market conditions in the 
Community which 
53 
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makes the application of such measures temporarily inappropriate, provided that the 
Community industry has been given an opportunity to comment. The suspension may 
be extended for a further period if the Council so decides, by simple majority, on a 
proposal from the Commission. Measures may, at any time and after consultation, be re­
instated if the reason for suspension is no longer applicable. 
5. The Commission may, after consultation of the Advisory Committee, direct the 
customs authorities to take the appropriate steps to register imports, so that measures 
may subsequently be applied against these imports from the date of such registration. 
Imports may be made subject to registration following a request from the Community 
industry which contains sufficient evidence to justify such action. Registration shall be 
introduced by Regulation which shall specify the purpose of the action and, if 
appropriate, the estimated amount of possible future liability. Imports may not be made 
subject to registration for a period longer than nine months. 
6. Member States shall report to the Commission, on a monthly basis, the import 
trade of products subject to investigation and subject to measures, and the amount of 
duties collected under this Regulation. 
54 
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Article 16 
Consultations 
1. Any consultations provided for in this Regulation shall take place within an 
Advisory Committee, which shall consist of representatives of each Member State, with 
a representative of the Commission as chairman. Consultations shall be held 
immediately on request by a Member State or on the initiative of the Commission, and 
in any event within a time frame which allows the time limits set by this Regulation to 
be respected. 
2. The Committee shall meet when convened by its chairman. He shall provide the 
Member States, as promptly as possible, with all relevant information. 
3. Where necessary, consultation may be in writing only; in such case the 
Commission shall notify the Member States and shall specify a period within which 
they shall be entitled to express their opinions or to request an oral consultation, which 
the chairman shall arrange, provided that such oral consultation can be held within a 
time frame which allows the time limits set by this Regulation to be respected. 
4. Consultation shall in particular cover: 
(i) the existence of countervailable subsidies and the methods of establishing 
their amount; 
(ii) the existence and extent of injury; 
55 
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(iii) the causal link between the subsidised or dumped imports and injury; 
(iv) the measures which, in the circumstances, are appropriate to prevent or 
remedy the injury caused by the countervailable subsidies or the dumping 
and the ways and means for putting such measures into effect. 
56 
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Article 17 
Verification visits 
1. The Commission shall, where it considers it appropriate, carry out visits to 
examine the records of importers, exporters, traders, agents, producers, trade 
associations and organisations, to verify information provided on subsidisation and 
injury. In the absence of a proper and timely reply, a verification visit may not be 
carried out. 
2. The Commission may carry out investigations in third countries as required, 
provided it obtains the agreement of the firms concerned, it notifies the representatives 
of the government of the country in question and the latter does not object to the 
investigation. As soon as the agreement of the firms concerned has been obtained the 
Commission should notify the authorities of the country of origin and/or export of the 
names and addresses of the firms to be visited and the dates agreed. 
3. The firms concerned shall be advised on the nature of the information to be 
verified during verification visits and of any further information which needs to be 
provided during such visits, though this should not preclude requests to be made during 
the verification for further details to be provided in the light of information obtained. 
4. In investigations carried out under this paragraph, the Commission shall be 
assisted by officials of those Member States who so request. 
57 
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Article 18 
Sampling 
1. In cases where the number of complainants, exporters or importers, types of 
product or transactions is large, the investigation may be limited to a reasonable number 
of parties, products or transactions by using samples which are statistically valid on the 
basis of information available to it at the time of the selection, or to the largest 
representative volume of the production, sales or exports which can reasonably be 
investigated within the time limit available. 
2. The final selection of parties, types of products or transactions made under these 
sampling provisions shall rest with the Commission, though preference shall be given to 
choosing a sample in consultation with, and with the consent of, the parties concerned, 
provided such parties make themselves known and make sufficient information 
available, within three weeks of initiation, to enable a representative sample to be 
chosen. 
3. In cases where the examination has been limited in accordance with this Article, 
an individual amount of countervailable subsidisation shall, nevertheless, be calculated 
for any exporter or producer not initially selected who submits the necessary 
information within the time limits provided for in this Regulation, except where the 
number of exporters or producers is so large that individual examinations would be 
unduly burdensome and prevent the timely completion of the investigation. 
4. Where it is decided to sample and there is a degree of non-co-operation by some 
or all of the parties selected which is likely to materially affect the outcome of the 
investigation, a new sample may be selected. However, if a material degree of non-co­
operation persists or there is insufficient time to select a new sample, the relevant 
provisions of Article 19 shall apply. 
58 
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Article 19 
Non-co-operation 
1. In cases in which any interested party refuses access to, or otherwise does not 
provide, necessary information within the time limits as provided for in this Regulation, 
or significantly impedes the investigation, preliminary or final findings, affirmative or 
negative, may be made on the basis of the facts available. Where the it is found that any 
interested party has supplied false or misleading information, the information shall be 
disregarded and use may be made of the facts available. Interested parties should be 
made aware of the consequences of non-co-operation. 
2. A lack of a computerised response shall not be deemed to constitute non-co­
operation provided that the interested party shows that presenting the response as 
requested would result in an unreasonable extra burden or unreasonable additional cost. 
3. Where the information presented by an interested party may not be ideal in all 
respects it should not be disregarded, provided that any deficiencies are not such as to 
cause undue difficulty in arriving at a reasonably accurate finding and provided the 
information is appropriately submitted in timely fashion, it is verifiable and the party 
has acted to the best of its ability. 
4. If evidence or information is not accepted, the supplying party should be informed 
forthwith of the reasons thereof and have an opportunity to provide further explanations 
within the time limit specified. If the explanations are considered unsatisfactory, the 
reasons for rejection of such evidence or information should be disclosed and given in 
any published findings. 
59 
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5. If determinations, including those with respect to the amount of countervailable 
subsidies , are based on the provisions of paragraph 1 of this Article, including the 
information supplied in the complaint, it should, where practicable and with due regard 
to the time limits of the investigation, be checked by reference to information from 
other independent sources which may be available, such as published price lists, official 
import statistics and customs returns, or information obtained from other interested 
parties during the investigation. 
6. If an interested party does not co-operate, or only co-operates partially, and thus 
relevant information is being withheld, the result could be less favourable to the party 
than if it had co-operated. 
60 
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Article 20 
Confidentiality 
1. Any information which is by nature confidential, (for example, because its 
disclosure would be of significant competitive advantage to a competitor or because its 
disclosure would have a significantly adverse effect upon a person supplying the 
information or upon a person from whom he acquired the information) or which is 
provided on a confidential basis by parties to an investigation shall, upon good cause 
shown, be treated as such by the authorities. 
2. Interested parties providing confidential information shall be required to furnish 
non-confidential summaries thereof. These summaries shall be in sufficient detail to 
permit a reasonable understanding of the substance of the information submitted in 
confidence. In exceptional circumstances, such parties may indicate that such 
information is not susceptible of summary. In such exceptional circumstances, a 
statement of the reasons why summarisation is not possible must be provided. 
3. If it is considered that a request for confidentiality is not warranted and if the 
supplier of the information is either unwilling to make the information available or to 
authorise its disclosure in generalised or summary form, such information may be 
disregarded unless it can be satisfactorily demonstrated from appropriate sources that 
the information is correct. Requests for confidentiality should not be arbitrarily rejected. 
4. This Article shall not preclude the disclosure of general information by the 
Community authorities and in particular of the reasons on which decisions taken 
pursuant to this Regulation are based, or disclosure of the evidence relied on by the 
Community authorities is so far as necessary to explain those reasons in court 
proceedings. Such disclosure must take into account the legitimate interest of the parties 
concerned that their business or Governmental secrets should not be divulged. 
61 
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5. The Council, the Commission and the Member States, or the officials of any of 
these, shall not reveal any information received pursuant to this Regulation for which 
confidential treatment has been requested by its supplier, without specific permission 
from the supplier. Exchanges of information between the Commission and Member 
States, any information relating to consultations made pursuant to Article 16 or 
consultations described in Paragraph 9 of Article 7 and Paragraph 10 of Article 8, or any 
internal documents prepared by the authorities of the Community or its Member States, 
shall be not be divulged except as specifically provided for in this Regulation. 
6. Information received pursuant to this Regulation shall be used only for the 
purpose for which it was requested. 
62 
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Article 21 
Disclosure 
1. The complainants, importers, exporters and representatives of the country or 
origin and/or export may request disclosure of the details underlying the essential facts 
and considerations, on the basis of which provisional measures have been imposed. 
Requests for such disclosure shall be made in writing immediately following the 
imposition of provisional measures and the disclosure shall be made in writing as soon 
as possible thereafter. 
2. The parties mentioned in paragraph 1, may request final disclosure of the essential 
facts and considerations, on the basis of which it is intended to recommend the 
imposition of definitive measures, or the termination of an investigation or proceedings 
without the imposition of measures, with particular attention being paid to the 
disclosure of any facts or considerations which are different from those used for any 
provisional measures. 
3. Requests for final disclosure, as defined in paragraph 2, shall be addressed to the 
Commission in writing and be received, in cases where a provisional duty has been 
applied, not later than one month after publication of the imposition of that duty. Where 
a provisional duty has not been applied, parties shall be provided with an opportunity to 
request final disclosure within time limits set by the Commission. 
4. Final disclosure shall be given in writing. It shall be made, with due regard paid to 
the protection of business or Governmental secrets, as soon as possible, and normally, 
not later than one month prior to a definitive decision or the submission by the 
Commission of any proposal for final action pursuant to Article 11. Where the 
Commission is not in a position to disclose certain facts or considerations at that time, 
these shall be disclosed as soon as possible thereafter. Disclosure shall not prejudice any 
subsequent decision which may be taken by the Commission or the Council, but where 
such decision is based on any different facts and considerations, these shall be disclosed 
as soon as possible. 
63 
lï\ 
5. Representations made after final disclosure is given shall be taken into 
consideration only if received within a period to be set by the Commission in each case, 
which shall be at least 10 days, due consideration being given to the urgency of the 
matter. 
64 
£$X 
Article 22 
Community interest 
1. Under this Regulation, a determination as to whether the Community interest calls 
for intervention shall be based on an appreciation of all the various interests taken as a 
whole, including the interests of the domestic industry and users and consumers, and a 
determination under this Article shall only be made where all parties have been given 
the opportunity to make their views known under paragraph 2. In such an examination, 
the need to eliminate the trade distorting effects of injurious subsidisation and to restore 
effective competition shall be given special consideration. Measures, as determined on 
the basis of subsidization and injury found, may not be applied where the authorities, on 
the basis of all the information submitted, can safely conclude that it is not in the 
Community interest to apply such measures. 
2. In order to provide a sound basis on which the authorities can take account of all 
views and information in the decision on whether, or not, the imposition of measures is 
in the Community interest, the complainants, importers, representative users and 
representative consumer organisations may, within the time limits specified in the notice 
of initiation of the countervailing duty investigation, make themselves known and 
provide information to the Commission. Such information, or appropriate summaries 
thereof, shall be made available to the other parties specified in this Article, and they 
shall be entitled to respond to such information. 
3. The parties which have acted in conformity with paragraph 2 may request a 
hearing. Such requests shall be made in writing, within the time limits set in paragraph 
2, and shall set out the particular reasons, in terms of the Community interest, why they 
should be heard. 
65 
Xîb 
4. The parties which have acted in conformity with paragraph 2 may provide 
comments on the application of any provisional duties imposed. Such comments shall 
be received within one month of the application of such measures if they are to be taken 
into account and they, or appropriate summaries thereof, shall be made available to 
other parties who shall be entitled to respond to such comments. 
5. The Commission shall examine the information which is properly submitted, and 
the extent to which it is representative, and the results of such analysis, together with an 
opinion on its merits, shall be transmitted to the Advisory Committee. The balance of 
views expressed in the Committee shall be taken into account by the Commission in any 
proposal made under Article 11. 
6. The parties which have acted in conformity with paragraph 2, may request the 
facts and considerations on which final decisions are likely to be taken to be made 
available to them. Such information shall be made available to the extent possible and 
without prejudice to any subsequent decision taken by the Commission or the Council. 
7. Under this Article, information shall only be taken into account where it is 
supported by actual evidence which substantiates its validity. 
66 
Mlf 
Article 23 
Relationships between countervailing duty measures and multilateral remedies 
If an imported product is made subject to any countermeasures imposed following 
recourse to the dispute settlement procedures of the Subsidies Agreement, and such 
measures are appropriate to remove the injury caused by the countervailable subsidies, 
any countervailing duty imposed with regard to that product shall immediately be 
suspended, or repealed, as appropriate. 
Article 24 
Final provisions 
This Regulation shall not preclude the application of: 
(i) any special rules laid down in agreements concluded between the Community and 
third countries; 
(ii) the Community Regulations in the agricultural sector and of Regulation (EEC) No 
1059/69W , (EEC) No 2730/750) ; and (EEC) No 2783/75(6) ; this Regulation shall 
operate by way of complement to those Regulations and in derogation from any 
provisions thereof which preclude the application of anti-dumping or 
countervailing duties; 
(iii) special measures, provided that such action does not run counter to obligations 
under the GATT. 
<4)OJNoL 141, 12.06.1969, p. 1. 
<5) OJNo L 281, 01.11.1975, p. 20. 
<6)OJ No L 282, 01.11.1975, p. 104. 
67 
^ Si" 
Article 25 
Repeal of existing legislation 
Regulation (EEC) No 2423/88, as amended by Regulation (EC) No 521/94 and 
Regulation (EC) No 522/94, is hereby repealed. References to the repealed Regulation 
shall be construed as references to this Regulation. 
Article 26 
Entry into force 
This Regulation shall enter into force on the date determined by a decision governing 
the entry into force of the acts implementing the results of the Uruguay Round. It shall 
apply to proceedings already initiated. However, the references to time limits for the 
initiation of proceedings and the imposition of provisional duties shall only apply after a 
date which the Council shall specify in a Decision to be adopted by a qualified majority 
no later than 1 April 1995 on the basis of a Commission proposal to be submitted to the 
Council once the necessary budgetary resources have been made available. 
This Regulation shall be binding in its entirety and directly applicable in all Member 
States. 
Done at Brussels, 
68 
ANNEX I 
ILLUSTRATIVE LIST OF EXPORT SUBSIDIES 
(a) The provision by governments of direct subsidies to a firm or an industry 
contingent upon export performance. 
(b) Currency retention schemes or any similar practices which involve a bonus on 
exports. 
(c) Internal transport and freight charges on export shipments, provided or mandated 
by governments, on terms more favourable than for domestic shipments. 
(d) The provision by governments or their agencies either directly or indirectly 
through government-mandated schemes, of imported or domestic products or services 
for use in the production of exported goods, on terms or conditions more favourable 
than for provision of like or directly competitive products or services for use in the 
production of goods for domestic consumption, if (in the case of products) such terms or 
conditions are more favourably than those commercially availableO) on world markets 
to their exporters. 
0) The term "commercially available" means that the choice between domestic and imported products is 
unrestricted and depends only on commercial considerations. 
> 
(e) The full or partial exemption, remission, or deferral specifically related to exports, 
of direct taxes(^) or social welfare charges paid or payable by industrial or commercial 
enterprises^3). 
(f) The allowance of special deductions directly related to exports or export 
performance, over and above those granted in respect of production for domestic 
consumption, in the calculation of the base on which direct taxes are charged. 
(g) The exemption or remission, in respect of the production and distribution of 
exported products, of indirect taxes(2) in excess of those levied in respect of the 
production and distribution of like products when sold for domestic consumption. 
(h) The exemption, remission or deferral of prior-stage cumulative indirect taxes (2) 
on goods or services used in the production of exported products in excess of the 
exemption, remission or deferral of like prior-stage cumulative indirect taxes on goods 
or services used in the production of like products when sold for domestic consumption; 
provided, however, that prior-stage cumulative indirect taxes may be exempted, 
remitted or deferred on exported products even when not exempted, remitted or deferred 
on like products when sold for domestic consumption, if the prior-stage cumulative 
indirect taxes are levied on inputs that are consumed in the production of the exported 
product (making normal allowance for waste)(4) . This item shall be interpreted in 
(2) For the purpose of this Regulation and its annexes: 
The term "direct taxes" shall mean tax on wages, profits, interests, rents, royalties, and all other 
forms of income, and taxes on the ownership of real property; 
The term "import charges" shall mean tariffs, duties, and other fiscal charges not elsewhere 
enumerated that are levied on imports; 
The term "indirect taxes" shall mean sales, excise, turnover, value added, franchise, stamp, 
transfer, inventory and equipment taxes, border taxes and all taxes other than direct taxes and import 
charges; 
"Prior-stage" indirect taxes are those levied on goods or services used directly or indirectly in 
making the product; 
"Cumulative" indirect taxes are multi-staged taxes levied where there is no mechanism for 
subsequent crediting of the tax if the goods or services subject to tax at one stage of production are used 
in a succeeding state of production; 
"Remission" of taxes includes the refund or rebate of taxes; 
"Remission of drawback" includes the full or partial exemption or deferral of import charges. 
<3) Deferral may not amount to an export subsidy where, for example, appropriate interest charges are 
collected. 
(4) Paragraph (h) does not apply to value-added tax systems and border-tax adjustment in lieu thereof; the 
problem of the excessive remission of value-added taxes is exclusively covered by paragraph (g). 
70 
11 g. 
accordance with the guidelines on consumption of inputs in the production process 
contained in Annex II. 
(i) The remission or drawback of import charges(2) in excess of those levied on 
imported inputs that are consumed in the production of the exported product (making 
normal allowance for waste); provided , however, that in particular cases a firm may use 
a quantity of home market inputs equal to, and having the same quality and 
characteristics as, the imported inputs as a substitute for them in order to benefit from 
this provision if the import and the corresponding export operations both occur within a 
reasonable time period, not to exceed two years. This item shall be interpreted in 
accordance with the guidelines on consumption of inputs in the production process 
contained in Annex II and the guidelines in the determination of substitution drawback 
systems as export subsidies contained in Annex III. 
(j) The provision by governments (or special institutions controlled by governments) 
of export credit guarantee or insurance programmes, of insurance or guarantee 
programmes against increases in the cost of exported products or of exchange risk 
programmes, at premium rates which are inadequate to cover the long-term operating 
costs and losses of the programmes. 
(2) See previous reference. 
71 
Ztb 
(k) The grant by governments (or special institutions controlled by and/or acting 
under the authority of governments) of export credits at rates below those which they 
actually have to pay for the funds so employed (or would have to pay if they borrowed 
on international capital markets in order to obtain funds of the same maturity and other 
credit terms and denominated in the same currency at the export credit), or the payment 
by them of all or part of the costs incurred by exporters or financial institutions in 
obtaining credits, in so far as they are used to secure a material advantage in the field of 
export credit terms. 
Provided, however, that if a Member of the WTO is a party to an international 
undertaking on official export credits to which at least twelve original such Members 
are parties as of 1 January 1979 (or a successor undertaking which has been adopted by 
those original Members), or if in practice a Member of the WTO applied the interest 
rates provisions of the relevant undertaking, an export credit practice which is in 
conformity with those provisions shall not be considered an export subsidy. 
(1) Any other charge on the public account constituting an export subsidy in the sense 
of Article XVI of GATT 1994. 
72 
15 o 
ANNEX II 
GUIDELINES ON CONSUMPTION OF INPUTS IN THE PRODUCTION 
PROCESS*5) 
I 
1. Indirect tax rebate schemes can allow for exemption, remission or deferral of 
prior-stage cumulative indirect taxes levied on inputs that are consumed in the 
production of the exported product (making normal allowance for waste). Similarly, 
drawback schemes can allow for the remission or drawback of import charges levied on 
inputs that are consumed in the production of the exported product (making normal 
allowance for waste). 
2. The Illustrative List of Export Subsidies in Annex I makes reference to the term 
"inputs that are consumed in the production of the exported product" in paragraphs (h) 
and (i). Pursuant to paragraph (h), indirect tax rebate schemes can constitute an export 
subsidy to the extent that they result in exemption , remission or deferral of prior-stage 
cumulative indirect taxes in excess of the amount of such taxes actually levied on inputs 
that are consumed in the production of the exported product. Pursuant to paragraph (i), 
drawback schemes can constitute an export subsidy to the extent that they result in a 
remission or drawback of import charges in excess of those actually levied on inputs 
that are consumed in the production of the exported product. Both paragraphs stipulate 
that normal allowance for waste must be made in findings regarding consumption of 
inputs in the production of the exported product. Paragraph (i) also provides for 
substitution, where appropriate. 
(5) Inputs consumed in the production processes are inputs physically incorporated, energy, fuels and oil 
used in the production process and catalysts which are consumed in the course of their use to obtain the 
exported product. 
^ 
II 
3. In examining whether inputs are consumed in the production of the exported 
product, as part of a countervailing duty investigation, the Commission shall normally 
proceed on the following basis: 
4. Where it is alleged that an indirect tax rebate scheme, or a drawback scheme, 
conveys a subsidy by reason of over-rebate or excess drawback of indirect taxes or 
import charges on inputs consumed in the production of the exported product, the 
Commission shall normally first determine whether the government of the exporting 
country has in place and applies a system or procedure to confirm which inputs are 
consumed in the production of the exported product and in what amounts. Where such a 
system or procedure is determined to be applied, the Commission shall normally then 
examine the system or procedure to see whether it is reasonable, effective for the 
purpose intended, and based on generally accepted commercial practices in the country 
of export. The Commission may deem it necessary to carry out, in accordance with 
paragraph 2 of Article 17, certain practical tests in order to verify information or to 
satisfy itself that the system or procedure is being effectively applied. 
5. Where there is no such system or procedure, where it is not reasonable, or where it 
is instituted and considered reasonable but is found not to be applied or not be applied 
effectively, a further examination by the exporting country based on the actual inputs 
involved will normally need to be carried out in the context of determining whether an 
excess payment occurred. If the Commission deems it necessary, a further examination 
may be carried out in accordance with paragraph 4. 
6. The Commission shall normally treat inputs as physically incorporated if such 
inputs are used in the production process and are physically present in the product 
exported. An input need not be present in the final product in the same form in which it 
entered the production process. 
74 
7. In determining the amount of a particular input that is consumed in the production 
of the exported product, a "normal allowance for waste" shall normally be taken into 
account, and such waste shall normally be treated as consumed in the production of the 
exported product. The term "waste" refers to that portion of a given input which does 
not serve an independent function in the production process, is not consumed in the 
production of the exported product (for reasons such as inefficiencies) and is not 
recovered, used or sold by the same manufacturer. 
8. The Commission's determination of whether the claimed allowance for waste is 
"normal" shall normally take into account the production process, the average 
experience of the industry in the country of export, and other technical factors, as 
appropriate. The Commission shall bear in mind that an important question is whether 
the authorities in the exporting country have reasonably calculated the amount of waste, 
when such an amount is intended to be included in the tax or duty rebate or remission. 
75 
153 
ANNEX III 
GUIDELINES IN THE DETERMINATION OF SUBSTITUTION 
DRAWBACK SYSTEMS AS EXPORT SUBSIDIES 
I 
1. Drawback systems can allow for the refund or drawback of import charges on 
inputs which are consumed in the production process of another product and where the 
export of this latter product contains domestic inputs having the same quality and 
characteristics as those submitted for the imported inputs. Pursuant to paragraph (i) of 
the Illustrative List of Export Subsidies in Annex I, substitution drawback systems can 
constitute an export subsidy to the extent that they result in an excess drawback of the 
import charges levied initially on the imported inputs for which drawback is being 
claimed. 
II 
2. In examining any substitution drawback system as part of a countervailing duty 
investigation pursuant to this Regulation, the Commission shall normally proceed on the 
following basis: 
3. Paragraph (i) of the Illustrative List stipulates that home market inputs may be 
substituted for imported inputs in the production of a product for export provided such 
inputs are equal in quantity to, and have the same quality and characteristics as, the 
imported inputs being substituted. The existence of a verification system or procedure is 
important because it enables the government of the exporting country to ensure and 
demonstrate that the quantity on inputs for which drawback is claimed does not exceed 
the quantity of similar products exported, in whatever form, and that there is not 
drawback of import charges in excess of those originally levied on the imported inputs 
in question. 
23 H 
4. Where it is alleged that a substitution drawback system conveys a subsidy, the 
Commission shall normally first proceed to determine whether the government of the 
exporting country has in place and applies a verification system or procedure. Where 
such a system or procedure is determined to be applied, the Commission shall normally 
then examine the verification procedures to see whether they are reasonable, effective 
for the purpose intended, and based on generally accepted commercial practices in the 
country of export. To the extent that the procedures are determined to meet this test and 
are effectively applied, no subsidy will be presumed to exist. It may be deemed 
necessary by the Commission to carry out, in accordance with paragraph 2 of Article 17, 
certain practical tests in order to verify information or to satisfy itself that the 
verification procedures are being effectively applied. 
5. Where there are no verification procedures, where they are not reasonable, or 
where such procedures are instituted and considered reasonable but are found not to be 
actually applied or not be applied effectively, there may be a subsidy. In such cases, 
further examination by the exporting country based on the actual transactions involved 
would need to be carried out to determinate whether an excess payment occurred. If the 
Commission deems it necessary, a further examination would be carried out in 
accordance with paragraph 4. 
6. The existence of a substitution drawback provision under which exporters are 
allowed to select particular import shipments on which drawback is claimed should not 
of itself be considered to convey a subsidy. 
7. An excess drawback of import charges in the sense of paragraph (i) would be 
deemed to exist where governments paid interest on any monies refunded under their 
drawback schemes, to the extent of the interest actually paid or payable. 
77 
2A 
ANNEX IV 
(This Annex reproduces Annex 2 to the Agreement on Agriculture. Any terms or 
expression which are not explained herein or which are not self-explanatory are to be 
interpreted in the context of that Agreement) 
DOMESTIC SUPPORT : THE BASIS OF EXEMPTION 
FROM THE REDUCTION COMMITMENTS 
1. Domestic support measures for which exemption from the reduction commitments 
is claimed shall meet the fundamental requirement that they have no, or at most 
minimal, trade-distorting effects of effects on production. Accordingly, all measures for 
which exemption is claimed shall conform to the following basic criteria: 
(a) the support in question shall be provided through a publicly-funded 
government programme (including government revenue foregone) not 
involving transfers from consumers; and, 
(b) the support in question shall not have the effect of providing price support to 
producers; 
plus policy-specific criteria and conditions as set out below. 
2AL 
Government Service Programmes 
2. General Services 
Policies in this category involve expenditures (or revenue foregone) in relation to 
programmes which provide services or benefits to agriculture or the rural 
community. They shall not involve direct payments to producers or processors. 
Such programmes, which include but are not restricted to the following list, shall 
meet the general criteria in paragraph 1 above and policy-specific conditions 
where set out below: 
(a) research, including general research, research in connection with 
environmental programmes, and research programmes relating to particular 
products; 
(b) pest and disease control, including general and product-specific pest and 
disease control measures, such as early-warning systems, quarantine and 
eradication; 
(c) training services, including both general and specific training facilities; 
(d) extension and advisory services, including the provision of means to 
facilitate the transfer of information and the results of research to producers 
and consumers; 
(e) inspection services, including general inspection services and the inspection 
of particular products for health, safety, grading or standardization purposes; 
(f) marketing and promotion services, including market information, advice and 
promotion relating to particular products but excluding expenditure for 
unspecified purposes that could be used by sellers to reduce their selling 
price or confer a direct economic benefit to purchasers; and 
79 
(g) infrastructural services, including: electricity reticulation, roads and other 
means of transport, market and port facilities, water supply facilities, dams 
and drainage schemes, and infrastructural works associated with 
environmental programmes. In all cases the expenditure shall be directed to 
the provision or construction of capital works only, and shall exclude the 
subsidized provision of on-farm facilities other than for the reticulation of 
generally available public utilities. It shall not include subsidies to inputs or 
operating costs, or preferential user charges. 
3. Public stockholding for food security purposes*6) 
Expenditures (or revenue foregone) in relation to the accumulation and holding of 
stocks of products which form an integral part of a food security programme 
identified in national legislation. This may include government aid to private 
storage of products as part of such a programme. 
F.q rri (A> 
The volume and accumulation of such stocks shall correspond to predetermined 
targets related solely to food security. The process of stock accumulation and 
disposal shall be financially transparent. Food purchases by the government shall 
be made at current market prices and sales from food security stocks shall be 
made at no less than the current domestic market price for the product and quality 
in question. 
4. Domestic food aid*7) 
Expenditures (or revenue foregone) in relation to the provision of domestic food 
aid to sections of the population in need. 
(6) For the purpose of paragraph 3 of this Annex, governmental stockholding programmes for food 
security purposes in developing countries whose operation is transparent and conducted in accordance 
with officially published objective criteria or guidelines shall be considered to be in conformity with the 
provisions of this paragraph, including programmes under which stocks of foodstuffs for food security 
purposes are acquired and released at administered prices, provided that the difference between the 
acquisition price and the external reference price is accounted for in the AMS. 
(7) For the purposes of paragraphs 3 and 4 of this Annex, the provision of foodstuffs at subsidized prices 
with the objective of meeting food requirements of urban and rural poor in developing countries on a 
regular basis at reasonable prices shall be considered to be in conformity with the provisions of this 
paragraph. 
80 
•is 2 
Eligibility to receive the food aid shall be subject to clearly-defined criteria related 
to nutritional objectives. Such aid shall be in the form of direct provision of food 
to those concerned or the provision of means to allow eligible recipients to buy 
food either at market or a subsidized prices. Food purchases by the government 
shall be made at current market prices and the financing and administration of the 
aid shall be transparent. 
Direct payments to producers 
Support provided through direct payments (or revenue foregone, including 
payments in kind) to producers for which exemption from reduction commitments 
is claimed shall meet the basic criteria set out in paragraph 1 above, plus specific 
criteria applying to individual types of direct payment as set out in paragraphs 6 
through 13 below. Where exemption from reduction is claimed for any existing or 
new type of direct payment other than those specified in paragraphs 6 through 13, 
it shall conform to criteria (b) through (e) in paragraph 6, in addition to the general 
criteria set out in paragraph 1. 
Decoupled income support 
(a) Eligibility for such payments shall be determined by clearly-defined criteria 
such as income, status as a producer or landowner, factor use or production 
level in a defined and fixed base period. 
(b) The amount of such payments in any given year shall not be related to, or 
based on, the type or volume of production (including livestock units) 
undertaken by the producer in any year after the base period. 
(c) The amount of such payments in any given year shall not be related to, or 
based on, the prices, domestic or international, applying to any production 
undertaken in any year after the base period. 
81 
253 
(d) The amount of such payments in any given years shall not be related to, or 
based on, the factors of production employed in any year after the base 
period. 
(e) No production shall be required in order to receive such payments. 
7. Government financial participation in income insurance and income safety-net 
programmes 
(a) Eligibility for such payments shall be determined by an income loss, taking 
into account only income derived from agriculture, which exceeds 30 per 
cent of average gross income or the equivalent in net income terms 
(excluding any payments from the same or similar schemes) in the 
preceding three-year period or a three-year average based on the preceding 
five-year period, excluding the highest and the lowest entry. Any producer 
meeting this condition shall be eligible to receive the payments. 
(b) The amount of such payments shall compensate for less than 70 per cent of 
the producer's income loss in the year the producer becomes eligible to 
receive this assistance. 
(c) The amount of any such payments shall relate solely to income; it shall not 
relate to the type or volume of production (including livestock units) 
undertaken by the producer; or to the prices, domestic or international, 
applying to such production; or to the factors of production employed. 
(d) Where a producer receives in the same year payments under this paragraph 
arid under paragraph 8 (relief from natural disasters), the total of such 
payments shall be less than 100 per cent of the producer's total loss. 
82 
8. Payments (made either directly or by way of a government financial participation 
in crop insurance schemes) for relief from natural disasters 
(a) Eligibility for such payments shall arise only following a formal recognition 
by government authorities that a natural or like disaster (including disease 
outbreaks, pest infestations, nuclear accidents, and war on the territory of 
the Member concerned) has occurred or is occurring; and shall be 
determined by a production loss which exceeds 30 per cent of the average of 
production in the preceding three-year period or a three-year average based 
on the preceding five year period, excluding the highest and the lowest 
entry. 
(b) Payments made following a disaster shall be applied only in respect of 
losses of income, livestock (including payments in connection with the 
veterinary treatment of animals), land or other production factors due to the 
. .. . . •<•!•* un­
natural disaster m question. 
(c) Payments shall compensate for not more than the total cost of replacing such 
losses and shall not require or specify the type or quantity of future 
production. 
(d) Payments made during a disaster shall not exceed the level required to 
prevent or alleviate further loss as defined in criterion (b) above. 
(e) Where a producer receives in the same year payments under this paragraph 
and under paragraph 7(income insurance and income safety-net 
programmes), the total of such payments shall be less than 100 per cent of 
the producer's total loss. 
83 
âo-1 
9. Structural adjustment assistance provided through producer retirement 
programmes 
(a) Eligibility for such payments shall be determined by reference to clearly 
defined criteria in programmes designed to facilitate the retirement of 
persons engaged in marketable agricultural production, or their movement to 
non-agricultural activities. 
(b) Payments shall be conditional upon the total and permanent retirement of 
the recipients from marketable agricultural production. 
10. Structural adjustment assistance provided through resource retirement 
programmes. 
(a) Eligibility for such payments shall be determined by reference to clearly 
defined criteria in programmes designed to remove land or other resources, 
including livestock, from marketable agricultural production. 
(b) Payments shall be conditional upon the retirement of land from marketable 
agricultural production for a minimum of three years, and in the case of 
livestock on its slaughter or definitive permanent disposal. 
(c) Payments shall not require or specify any alternative use for such land or 
' other resources which involves the production of marketable agricultural 
products. 
(d) Payments shall not be related to either type or quantity of production or to 
the prices, domestic or international, applying to production undertaken 
using the land or other resources remaining in production. 
84 
So> 
11. Structural adjustment assistance provided through investment aids 
(a) Eligibility for such payments shall be determined by reference to clearly-
defined criteria in government programmes designed to assist the financial 
or physical restructuring of a producer's operations in response to 
objectively demonstrated structural disadvantages. Eligibility for such 
programmes may also be based on a clearly-defined government programme 
for the reprivatization of agricultural land. 
(b) The amount of such payments in any given year shall not be related to, or 
based on, the type or volume of production (including livestock units) 
undertaken by the producer in any year after the base period other than as 
provided for under criterion (e) below. 
(c) The amount of such payments in any given year shall not be related to, or 
based on, the prices, domestic or international, applying to any production 
undertaken in any year after the base period. 
(d) The payments shall be given only for the period of time necessary for the 
realisation of the investment in respect of which they are provided. 
(e) The payments shall not mandate or in any way designate the agricultural 
products to be produced by the recipients except to require them not to 
produce a particular product. 
(f) The payments shall be limited to the amount required to compensate for the 
structural disadvantage. 
85 
•3^3 
12. Payments under environmental programmes 
(a) Eligibility for such payments shall be determined as part of a clearly-defined 
government environmental or conservation programme and be dependent on 
the fulfilment of specific conditions under the government programme, 
including conditions related to production methods or inputs. 
(b) The amount of payment shall be limited to the extra costs or loss of income 
involved in complying with the government programme. 
13. Payments under regional assistance programmes 
(a) Eligibility for such payments shall be limited to producers in disadvantaged 
regions. Each such region must be a clearly designated contiguous 
geographical area with a definable economic and administrative identity, 
considered as disadvantaged on the basis of neutral and objective criteria 
clearly spelt out in a law or regulation and indicating that the region's 
difficulties arise out of more than temporary circumstances. 
(b) The amount of such payments in any given year shall not be related to, or 
based on, the type or volume of production (including livestock units) 
undertaken by the producer in any year after the base period other than to 
reduce that production. 
(c) The amount of such payments in any given year shall not be related to, or 
based on, the prices, domestic or international, applying to any production 
undertaken in any year after the base period. 
(d) Payments shall be available only to producers in eligible regions, but 
generally available to all producers within such regions. 
86 
i*>L| 
(e) Where related to production factors, payments shall be made at a degressive 
rate above a threshold level of the factor concerned. 
(f) The payments shall be limited to the extra costs of loss of income involved 
in undertaking agricultural production in the prescribed area. 
87 
'^cl 
Commercial defence: 
Safeguards 
% (o 
Explanatory memorandum 
The Uruguay Round Safeguards Agreement clarifies and strengthens the disciplines of 
GATT 1994, specifically those regarding the implementation of Article XIX. 
The Agreement restores multilateral control over safeguards and requires the elimination of 
any measures which escape such control. 
Safeguard measures may be applied only in the circumstances and in the manner specified in 
the Agreement. As a result, all grey area measures, i.e. arrangements for limiting imports 
or exports, orderly-marketing arrangements or other similar arrangements, will be 
prohibited and must be eliminated. 
The only exception made is for the EC-Japan arrangement relating to certain types of motor 
vehicle, which expires on 31 December 1999. 
In the Community's case, adherence to the obligations stemming from the Safeguards 
Agreement entails denouncing all grey-area measures by the deadline given in the 
Agreement (180 days following the entry into force of the Agreement Establishing the 
MTO) and reviewing or amending (where necessary) the common rules for imports 
established by Council Regulation (EC) No 518/94, particularly in connection with 
safeguards. 
The attached draft Regulation is the product of such a review. 
It should be pointed out, however, that Community legislation already contains precise rules 
that often go beyond the more general provisions of the Safeguards Agreement. This is the 
case, for example, with the strict investigation deadlines and the more detailed list of factors 
to be considered in determining serious injury and the causal link between such injury and 
imports. 
The main amendments to Council Regulation (EC) No 518/94 are therefore as follows: 
(a) Incorporation of definitions 
Definitions of the terms "threat of serious injury", "serious injury" and "Community 
producers". 
Article 5(3); Agreement on Safeguards Article 4(1) 
(b) Causal link: other factors 
The Article dealing with the factors to be considered in an investigation will have 
added to it an extra paragraph on determining the presence of a causal link. 
Article 10(1) (d); Agreement on Safeguards Article 4(2) 
% \ 
(c) Rights of the interested parties 
Explicitly expressed right of reply to other parties' arguments for the interested 
parties. 
End of Article 6(2); Agreement on Safeguards Article 3(1) 
(d) Taking of provisional safeguard measures in critical circumstances 
Adoption of the Safeguards Agreement's clauses on provisional measures 
(conditions, duration and nature). 
Article 8; Agreement on Safeguards Article 6 
(e) Quota levels 
Explicit provision on the setting of a quota at a level, in principle, no lower than 
average imports over the last three representative years. 
Article 16(2) (b); Agreement on Safeguards Article 5(1) 
(f) Allocation of quotas among supplier countries 
Arrangements for allocating quotas among supplier countries are now included 
(agreement, share of previous imports, modulation). 
Article 16(3); Agreement on Safeguards Article 5(2) 
(g) Duration of safeguard measures 
No safeguard measure may now remain in force for longer than four years unless 
extended after a further investigation. The extension may not be for longer than four 
years. 
Article 20; Agreement on Safeguards Article 7(1) to 7(3) 
(h) Progressive liberalization and mid-term review 
Any measure applying for longer than one year will have to be liberalized at regular 
intervals and any measure applying for longer than three years will be subject to a 
mid-term review. 
Articles 20(4) and 21 (1); Agreement on Safeguards Article 7(4) 
(i) Reimposition of safeguard measures 
There can now be no reimposition of safeguard measures on a particular product for 
at least two years from the expiry of the previous such measure. 
Article 22; Agreement on Safeguards Article 7(5) and 7(6) 
(j) Developing countries 
Adoption of the Safeguards Agreement's provisions prohibiting the imposition of 
safeguard measures on products from developing country WTO Members if imports 
of those products are below a certain level. 
Article 19; Agreement on Safeguards Article 9(1) 
COUNCIL REGULATION (EC) No .../94 
94/ 0232(ACC) 
of 1994 
on common rules for imports and repealing Regulation (EC) No 518/94 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, and in particular 
Article 113 thereof, 
Having regard to the instruments establishing common organization of agricultural markets 
and the instruments concerning processed agricultural products, in particular insofar as 
they provide for derogation from the general principle that quantitative restrictions or 
measures having equivalent effect may be replaced solely by the measures provided for in 
the said instruments, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the common commercial policy should be based on uniform principles; whereas 
Council Regulation (EC) No 518/941 of 7 March 1994 on common rules for imports and 
repealing Regulation (EEC) No 288/822 is an important part of the policy; 
Whereas due account was taken when Regulation (EC) No 518/94 was adopted of the 
Community's international obligations, particularly those deriving from Article XIX of the 
General Agreement on Tariffs and Trade (GATT); 
Whereas the completion of the Uruguay Round has led to the foundation of the World 
Trade Organization (WTO); whereas Annex 1A to the Agreement establishing the WTO 
contains inter alia the General Agreement on Tariffs and Trade 1994 (GATT 1994) and an 
Agreement on Safeguards; 
Whereas the Agreement on Safeguards meets the need to clarify and reinforce the 
disciplines of GATT 1994, and specifically those of Article XIX; whereas that Agreement 
requires the elimination of safeguard measures which escape those rules, such as voluntary 
export restraints, orderly marketing arrangements and any other similar import or export 
arrangements; 
' OJL67, 10.3.1994, p.77. 
2 OJL 35, 9.2.1982, p.l. 
REG518/518fin-e (version définitive) 
5o9 
2 
Whereas in the light of these new multilateral rules the common rules for imports should 
be made clearer and if necessary amended, particularly where the application of safeguard 
measures is concerned; 
Whereas the starting point for the common rules for imports is liberalization of imports, 
namely the absence of any quantitative restrictions; 
Whereas the Commission should be informed by the Member States of any danger created 
by trends in imports which might call for Community surveillance or the application of 
safeguard measures; 
Whereas in such instances the Commission should examine the terms and conditions under 
which imports occur, the trend in imports, the various aspects of the economic and trade 
situations and, where appropriate, the measures to be applied; 
Whereas if Community surveillance is applied, release for free circulation of the products 
concerned should be made subject to presentation of an import document meeting uniform 
criteria; whereas that document should, on simple application by the importer, be 
endorsed by the authorities of the Member States within a certain period but without the 
importer thereby acquiring any right to import; whereas the document should therefore be 
valid only during such period as the import rules remain unchanged; 
Whereas the Member States and the Commission should exchange the information resulting 
from Community surveillance as fully as possible; 
Whereas it falls to the Commission and the Council to adopt the safeguard measures 
required by the interests of the Community; whereas those interests should be considered 
as a whole and should in particular encompass the interest of Community producers, users 
and consumers; 
Whereas safeguard measures against a Member of the WTO may be considered only if the 
product in question is imported into the Community in such greatly increased quantities 
and on such terms or conditions as to cause, or threaten to cause, serious injury to 
Community producers of like or directly competing products, unless international 
obligations permit derogation from this rule; 
3 
Whereas the terms "serious injury", "threat of serious injury" and "Community producers" 
should be defined and more precise criteria for determining injury be established; 
Whereas an investigation must precede the application of any safeguard measure, subject to 
the reservation that the Commission be allowed in urgent cases to apply provisional 
measures; 
Whereas there should be more detailed provisions on the opening of investigations, the 
checks and inspections required, access by exporter countries and interested parties to the 
information gathered, hearings for the parties involved and the opportunities for those 
parties to submit their views; 
Whereas the provisions on investigations introduced by this Regulation are without 
prejudice to Community or national rules concerning professional secrecy; 
Whereas it is also necessary to set time limits for the initiation of investigations and for 
determinations as to whether or not measures are appropriate, with a view to ensuring that 
such determinations are made quickly, in order to increase legal certainty for the economic 
operators concerned; 
Whereas in cases in which safeguard measures take the form of a quota the level of the 
latter should be set in principle no lower than the average level of imports over a 
representative period of at least three years; 
Whereas in cases in which a quota is allocated among supplier countries each country's 
quota may be determined by agreement with the countries themselves or by taking as a 
reference the level of imports over a representative period; whereas derogations from these 
rules should nevertheless be possible where there is a disproportionate increase in imports, 
provided that due consultation under the auspices of the WTO Committee on Safeguards 
takes place; " 
Whereas the maximum duration of safeguard measures should be determined and specific 
provisions regarding extension, progressive liberalization and reviews of such measures be 
laid down; 
Whereas the circumstances in which products originating in a developing country Member 
of the WTO should be exempt from safeguard measures should be established; 
AA 
4 
Whereas surveillance or safeguard measures confined to one or more regions of the 
Community may prove more suitable than measures applying to the whole Community; 
whereas, however, such measures should be authorized only exceptionally and where no 
alternative exists; whereas it is necessary to ensure that such measures are temporary and 
cause the minimum of disruption to the operation of the internal market; 
Whereas in the interests of uniformity in rules for imports, the formalities to be carried out 
by importers should be simplified and made identical regardless of the place where the 
goods clear customs; whereas it is therefore desirable to provide that any formalities 
should be carried out using forms corresponding to the specimen annexed to the 
Regulation; 
Whereas import documents issued in connection with Community surveillance measures 
should be valid throughout the Community irrespective of the Member State of issue; 
Whereas the textile products covered by Regulation (EC) No 517/94 of 7 March 1994 on 
common rules for imports of textile products from certain third countries not covered by 
bilateral agreements, protocols or other arrangements or by other specific Community 
import rules are subject to special treatment at Community and international level; whereas 
they should therefore be completely excluded from the scope of this Regulation; 
Whereas the provisions of this Regulation are applicable without prejudice to Articles 77, 
81, 244, 249 and 280 of the Act of Accession of Spain and Portugal; 
Whereas Regulation (EC) No 518/94 should consequently be repealed, 
5 
HAS ADOPTED THIS REGULATION: 
TITLE I 
General principles 
Article 1 
1. This Regulation applies to imports of products covered by the Treaty originating in 
third countries, except for: 
textile products covered by Regulation (EC) No 517/94, 
the products originating in certain third countries listed in Regulation (EC) 
No 519/94 on common rules for imports from certain third countries, 
2. The products referred to in paragraph 1 shall be freely imported into the 
Community and accordingly, without prejudice to the safeguard measures which 
may be taken under Title V, shall not be subject to any quantitative restrictions. 
TITLE II 
Community information and consultation procedure 
Article 2 
The Commission shall be informed by the Member States should trends in imports appear 
to call for surveillance or safeguard measures. This information shall contain the evidence 
available, as determined on the basis of the criteria laid down in Article 10. The 
Commission shall immediately pass this information on to all the Member States. 
Article 3 
Consultations may be held either at the request of a Member State or on the initiative of the 
Commission. They shall take place within eight working days of the Commission receiving 
the information provided for in Article 2 and, in any event, before the introduction of any 
Community surveillance or safeguard measure. M.X 
H3 
6 
Article 4 
1. Consultation shall take place within an advisory committee, hereinafter called 'the 
Committee', made up of representatives of each Member State with a representative 
of the Commission as chairman. 
2. The Committee shall meet when convened by its chairman. He shall provide the 
Member States with all relevant information as promptly as possible, . 
3. Consultations shall cover in particular: 
terms and conditions of import, import trends and the various aspects of the 
economic and trade situation with regard to the product in question; 
the measures, if any, to be taken. 
4. Consultations may be conducted in writing if necessary. The Commission shall in 
this event inform the Member States, which may express their opinion or request 
oral consultations within a period of five to eight working days, to be decided by 
the Commission. 
TITLE m 
Community investigation procedure 
Article 5 
1. Without prejudice to Article 8, the Community investigation procedure shall be 
implemented before any safeguard measure is applied. 
2. Using as a basis the factors described in Article 10, the investigation shall seek to 
determine whether imports of the product in question are causing or threatening to 
cause serious injury to the Community producers concerned. 
3. The following definitions shall apply: 
(a) "serious injury" means a significant overall impairment in the position of 
Community producers, 
M-V 
(b) "threat of serious injury" means serious injury that is clearly imminent; 
(c) "Community producers" means the producers as a whole of the like or 
directly competing products operating within the territory of the 
Community, or those whose collective output of the like or directly 
competing products constitutes a major proportion of the total Community 
production of those products. 
Article 6 
1. Where after consultations referred to in Article 3, it is apparent to the Commission 
that there is sufficient evidence to justify the initiation of an investigation, the 
Commission shall: 
(a) initiate an investigation within one month of receipt of information from a 
Member State and publish a notice in the Official Journal of the European 
Communities', such notice shall give a summary of the information received, 
and stipulate that all relevant information is to be communicated to the 
Commission; it shall state the period within which interested parties may 
make known their views in writing and submit information, if such views and 
information are to be taken into account during the investigation; it shall also 
state the period within which interested parties may apply to be heard orally 
by the Commission in accordance with paragraph 4; 
(b) commence the investigation, acting in cooperation with the Member States. 
2. The Commission shall seek all information it deems to be necessary and, where it 
considers it appropriate, after consulting the Committee, endeavour to check this 
information with importers, traders, agents, producers, trade associations and 
organizations. 
The Commission shall be assisted in this task by staff of the Member State on 
whose territory these checks are being carried out, provided that Member State so 
wishes. 
Interested parties which have come forward under paragraph (l)(a) and 
representatives of the exporting country may, upon written request, inspect all 
information made available to the Commission in connection with the investigation 
other than internal documents prepared by the authorities of the Community or its 
Member States, provided that that information is relevant to the presentation of 
their case and not confidential within the meaning of Article 9, and that it is used by 
the Commission in the investigation. 
MS 
Interested parties which have come forward may communicate their views on the -
information in question to the Commission; those views may be taken into 
consideration where they are backed by sufficient evidence. 
3. The Member States shall supply the Commission, at its request and following 
procedures laid down by it, with the information at their disposal on developments 
in the market of the product being investigated. 
4. The Commission may hear the interested parties. Such parties must be heard where 
they have made a written application within the period laid down in the notice 
published in the Official Journal of the European Communities, showing that they 
are actually likely to be affected by the outcome of the investigation and that there 
are special reasons for them to be heard orally. 
5. When information is not supplied within the time limits set by this Regulation or by 
the Commission under this Regulation, or the investigation is significantly impeded, 
findings may be made on the basis of the facts available. Where the Commission 
finds that any interested party or third party has supplied it which false or 
misleading information, it shall disregard the information and may make use of 
facts available. 
6. Where it appears to the Commission, after the consultation referred to in Article 3, 
that there is insufficient evidence to justify an investigation, it shall inform the 
Member States of its decision within one month of receipt of the information from 
the Member States. 
Article 7 
1. At the end of the investigation, the Commission shall submit a report on the results 
to the Committee. 
2. Where the Commission considers, within nine months of the initiation of the 
investigation, that no Community surveillance or safeguard measures are necessary, 
the investigation shall be terminated within a month, the Committee having first 
been consulted. The decision to terminate the investigation, stating the main 
conclusions of the investigation and a summary of the reasons therefor, shall be 
published in the Official Journal of the European Communities. 
9 
3. If the Commission considers that Community surveillance or safeguard measures 
are necessary, it shall take the necessary decisions in accordance with Titles IV and 
V, no later than nine months from the initiation of the investigation. In exceptional 
circumstances, this time limit may be extended by a further maximum period of two 
months; the Commission shall then publish a notice in the Official Journal of the 
European Communities setting forth the duration of the extension and a summary of 
the reasons therefor. 
Article 8 
1. The provisions of this Title shall not preclude the use, at any time, of surveillance 
measures in accordance with Articles 11 to 15 or provisional safeguard measures in 
accordance with Articles 16, 17 and 18. 
Provisional safeguard measures shall be applied: 
in critical circumstances where delay would cause damage which it would be 
difficult to repair, making immediate action necessary; 
where a preliminary determination provides clear evidence that increased 
imports have caused or are threatening to cause serious injury. 
2. The duration of such measures shall not exceed 200 days. 
3. Provisional safeguard measures should take the form of an increase in the existing 
level of customs duty (whether the latter is zero or higher) if such action is likely to 
prevent or repair the serious injury. 
4. The Commission shall immediately conduct whatever investigation measures are 
still necessary. 
5. Should the provisional safeguard measures be repealed because no serious injury or 
threat of serious injury exists, the customs duties collected as a result of the 
provisional measures shall be automatically refunded as soon as possible. The 
procedure laid down in Article 235 et seq of Council Regulation (EEC) No 2913/92 
of 12 October 1992 shall apply. 
10 
Article 9 
1. Information received pursuant to this Regulation shall be used only for the purpose 
for which it was requested. 
2. (a) Neither the Council, nor the Commission, nor the Member States, nor the 
officials of any of these shall reveal any information of a confidential nature 
received pursuant to this Regulation, or any information provided on a 
confidential basis without specific permission from the supplier of such 
information. 
(b) Each request for confidentiality shall state the reasons why the information 
is confidential. 
However, if it appears that a request for confidentiality is unjustified and if 
the supplier of the information wishes neither to make it public nor to 
authorize its disclosure in general terms or in the form of a summary, the 
information concerned may be disregarded. 
3. Information shall in any case be considered to be confidential if its disclosure is 
likely to have a significantly adverse effect upon the supplier or the source of such 
information. 
4. The preceding paragraphs shall not preclude reference by the Community 
authorities to general information and in particular to reasons on which decisions 
taken under this Regulation are based. The said authorities shall, however, take into 
account the legitimate interest of the legal and natural persons concerned that their 
business secrets should not be divulged. 
Article 10 
1. Examination of the trend of imports, of the conditions in which they take place and 
of serious injury or threat of serious injury to Community producers resulting from 
such imports shall cover in particular the following factors: 
(a) the volume of imports, in particular where there has been a significant 
increase, either in absolute terms or relative to production or consumption in 
the Community; A\ 
Mi H 
(b) the price of the imports, in particular where there has been a significant 
price undercutting as compared with the price of a like product in the 
Community; 
(c) the consequent impact on the Community producers as indicated by trends in 
certain economic factors such as: 
production, 
capacity utilization, 
stocks, 
sales, 
market share, 
prices (i.e. depression of prices or prevention of price increases 
which would normally have occurred), 
profits, 
return on capital employed, 
cash flow, 
employment. 
(d) factors other than trends in imports which are causing or may have caused 
injury to the Community producers concerned. 
2. Where a threat of serious injury is alleged, the Commission shall also examine 
whether it is clearly foreseeable that a particular situation is likely to develop into 
actual injury. In this regard account may be taken of factors such as: 
(a) the rate of increase of the exports to the Community; 
(b) export capacity in the country of origin or export, as it stands or is likely to 
be in the foreseeable future, and the likelihood that that capacity will be used 
* to export to the Community. 
12 
TITLE IV 
Surveillance 
Article 11 
1. Where the trend in imports of a product originating in a third country covered by 
this Regulation threatens to cause injury to Community producers, and where the 
interests of the Community so require, import of that product may be subject, as 
appropriate, to: 
(a) retrospective Community surveillance carried out in accordance with the 
provisions laid down in the decision referred to in paragraph 2, 
or 
(b) prior Community surveillance carried out in accordance with Article 12. 
2. The decision to impose surveillance shall be taken by the Commission according to 
the procedure laid down in Article 16 (5) and (6). 
3. The surveillance measures shall have a limited period of validity. Unless otherwise 
provided, they shall cease to be valid at the end of the second six-month period 
following the six months in which the measures were introduced. 
Article 12 
1. Products under prior Community surveillance may be put into free circulation only 
on production of an import document. Such document shall be endorsed by the 
competent authority designated by Member States, free of charge, for any quantity 
requested and within a maximum of five working days of receipt by the national 
competent authority of a declaration by any Community importer, regardless of his 
place of business in the Community. This declaration shall be deemed to have been 
received by the national competent authority no later than three working days after 
submission, unless it is proven otherwise. 
2. The import document and the declaration by the importer shall be made out on a 
form corresponding to the model in the Annex. 
^0 
13 
Additional information to that provided for in the aforementioned form may be 
required. Such information shall be specified in the decision to impose surveillance. 
3. The import document shall be valid throughout the Community, regardless of the 
Member State of issue. 
4. A finding that the unit price at which the transaction is effected exceeds that 
indicated in the import document by less than 5 % or that the total value or quantity 
of the products presented for import exceeds the value or quantity given in the 
import document by less than 5 % shall not preclude the release for free circulation 
of the product in question. The Commission, having heard the opinions expressed 
in the Committee and taking account of the nature of the products and other special 
features of the transactions concerned, may fix a different percentage, which, 
however, should not normally exceed 10 %. 
5. Import documents may be used only for such time as arrangements for liberalization 
of imports remain in force in respect of the transactions concerned. Such import 
documents may not in any event be used beyond the expiry of a period which shall 
be laid down at the same time and by means of the same procedure as the 
imposition of surveillance, and shall take account of the nature of the products and 
other special features of the transactions. 
6. Where the decision taken under Article 11 so requires, the origin of products under 
Community surveillance must be proved by a certificate of origin. This paragraph 
shall not affect other provisions concerning the production of any such certificate. 
7. Where the product under prior Community surveillance is subject to regional 
safeguard measures in a Member State, the import authorization granted by that 
Member State may replace the import document. 
Article 11 
Where import of a product has not been made subject to prior Community surveillance 
within eight working days of the end of consultations, the Commission, in accordance with 
Article 18, may introduce surveillance confined to imports into one or more regions of the 
Community. , 
b*l 
14 
Article 14 
1. Products under regional surveillance may be put into free circulation in the region 
concerned only on production of an import document. Such document shall be 
endorsed by the competent authority designated by the Member State(s) concerned, 
free of charge, for any quantity requested and within a maximum of five working 
days of receipt by the national competent authority of a declaration by any 
Community importer, regardless of his place of business in the Community. This 
declaration shall be deemed to have been received by the national competent 
authority no later than three working days after submission, unless it is proven 
otherwise. Import documents may be used only for such time as arrangements for 
imports remain liberalized in respect of the transactions concerned. 
2. The import document and the declaration by the importer shall be made out on a 
form corresponding to the model in the Annex. 
Additional information to that provided in the aforementioned form may be 
required. Such particulars shall be specified in the decision to impose surveillance. 
Article 15 
1. Member States shall communicate to the Commission within the first ten days of 
each month in the case of Commumty or regional surveillance : 
(a) in the case of prior surveillance, details of the sums of money (calculated 
on the basis of cif prices) and quantities of goods in respect of which import 
documents were issued or endorsed during the preceding period; 
(b) in every case, details of imports during the period preceding the period 
referred to in subparagraph (a). 
The information supplied by Member States shall be broken down by product and 
by country. 
Different provisions may be laid down at the same time and by the same procedure 
as the surveillance arrangements. 
2. Where the nature of the products or special circumstances so require, the 
Commission may, at the request of a Member State or on its own initiative, amend 
the timetables for submitting this information. 
3. The Commission shall inform the Member States accordingly. 
3ix 
15 
TITLE V 
Safeguard measures 
Article 16 
Where a product is imported into the Community in such greatly increased 
quantities and/or on such terms or conditions as to cause, or threaten to cause, 
serious injury to Community producers, the Commission, in order to safeguard the 
interests of the Community, may, acting at the request of a Member State or on its 
own initiative: 
(a) limit the period of validity of import documents within the meaning of 
Article 12 to be endorsed after the entry into force of this measure; 
(b) alter the import rules for the product in question by making its release for 
free circulation conditional on production of an import authorization, the 
granting of which shall be governed by such provisions and subject to such 
limits as the Commission shall lay down. 
The measures referred to in (a) and (b) shall take effect immediately. 
(a) When establishing a quota, account shall be taken in particular of: 
the desirability of maintaining, as far as possible, traditional trade 
flows, 
the volume of goods exported under contracts concluded on normal 
terms and conditions before the entry into force of a safeguard 
measure within the meaning of this Title, where such contracts have 
been notified to the Commission by the Member State concerned, 
the need to avoid jeopardizing achievement of the aim pursued in 
establishing the quota. 
(b) The quota shall not be set lower than the average level of imports over the 
last three representative years for which statistics are available unless a 
different level is necessary to prevent or remedy serious injury. 
(a) In cases in which a quota is allocated among supplier countries, allocation 
may be agreed with those of them having a substantial interest in supplying 
the product concerned for import into the Community. 
16 
Failing this, the quota shall be allocated among the supplier countries in 
proportion to their share of imports into the Community of the product 
concerned during a previous representative period, due account being taken 
of any specific factors which may have affected or may be affecting the trade 
in the product. 
(b) Provided that its obligation to see that consultations are conducted under the 
auspices of the WTO Committee on Safeguards is not disregarded, the 
Community may nevertheless depart from this method of allocation if 
imports originating in one or more supplier countries have increased in 
disproportionate percentage in relation to the total increase of imports of the 
product concerned over a previous representative period. 
4. (a) The measures referred to in this Article shall apply to every product which 
is put into free circulation after their entry into force. In accordance with 
Article 18 they may be confined to one or more regions of the Community. 
(b) However, such measures shall not prevent the release for free circulation of 
products already on their way to the Community provided that the 
destination of such products cannot be changed and that those products 
which, under Articles 11 and 12, may be put into free circulation only on 
production of an import document are in fact accompanied by such a 
document. 
5. Where intervention by the Commission has been requested by a Member State, the 
Commission shall take a decision within a maximum of five working days of receipt 
of such a request. 
6. Any decision taken by the Commission under this Article shall be commumcated to 
the Council and to the Member States. Any Member State may, within one month 
following the day of such communication, refer the decision to the Council. 
7. If a Member State refers the Commission's decision to the Council, the Council, 
acting by a qualified majority, may confirm, amend or revoke that decision. 
If, within three months of the referral of the matter to the Council, the Council has 
not taken a decision, the decision taken by the Commission shall be deemed 
revoked. lib 
17 
Article 17 
Where the interests of the Community so require, the Council, acting by a qualified 
majority on a proposal from the Commission drawn up in accordance with the terms of 
Title III, may adopt appropriate measures to prevent a product being imported into the 
Community in such greatly increased quantities and/or on such terms or conditions as to 
cause, or threaten to cause, serious injury to Community producers of like or directly 
competing products. 
Article 16 (2), (3) and (4) shall apply. 
Article 18 
Where it emerges, primarily on the basis of the factors referred to in Article 10, that the 
conditions laid down for the adoption of measures under Articles 11 and 16 are met in one 
or more regions of the Community, the Commission, after having examined alternative 
solutions, may exceptionally authorize the application of surveillance or safeguard 
measures limited to the region(s) concerned if it considers that such measures applied at 
that level are more appropriate than measures applied throughout the Community. 
These measures must be temporary and must disrupt the operation of the internal market as 
little as possible. 
The measures shall be adopted in accordance with the provisions laid down in Articles 11 
and 16 respectively. 
Article 19 
No safeguard measure may be applied to a product originating in a developing country 
Member of the WTO as long as that country's share of Community imports of the product 
concerned does not exceed 3%, provided that developing country Members with less than a 
3% import share collectively account for not more than 9% of total Community imports of 
the product concerned. 
l>a.r 
18 
Article 20 
1. The duration of safeguard measures must be limited to the period of time necessary 
to prevent or remedy serious injury and to facilitate adjustment on the part of 
Community producers. The period should not exceed four years, including the 
duration of any provisional measure. 
2. Such initial period may be extended, except in the case of the measures referred to 
in Article 16(3)(b), provided it is determined that: 
the safeguard measure continues to be necessary to prevent or remedy 
serious injury, 
and there is evidence that Community producers are adjusting. 
3. Extensions shall be adopted in accordance with the terms of Title III and using the 
same procedures as the initial measures. A measures so extended shall not be no 
more restrictive than it was at the end of the initial period. 
4. If the duration of the measure exceeds one year, the measure must be progressively 
liberalized at regular intervals during the period of application, including the period 
of extension. 
5. The total period of application of a safeguard measure shall not exceed eight years. 
Article 21 
1. While any surveillance or safeguard measure applied in accordance with Titles IV 
and V is in operation, consultations shall be held within the Committee, either at 
the request of a Member State or on the initiative of the Commission. If the 
duration of a safeguard measure exceeds three years, the Commission shall seek 
such consultations no later than the mid-point of the period of application of that 
measure. 
The purpose of such consultations shall be: 
(a) to examine the effects of the measure; 
(b) to determine whether and in what manner it is appropriate to accelerate the 
pace of liberalization; 
(c) to ascertain whether its application is still necessary. 
î>2£ 
19 
2. Where, as a result of the consultations referred to in paragraph 1, the Commission 
considers that any surveillance or safeguard measure referred to in Articles 11, 13, 
16, 17 and 18 should be revoked or amended, it shall proceed as follows: 
(a) where the measure was enacted by the Council, the Commission shall 
propose to the Council that it be revoked or amended. The Council shall act 
by a qualified majority. 
(b) in all other cases, the Commission shall amend or revoke Community 
safeguard and surveillance measures. 
Where the decision relates to regional surveillance measures, it shall apply from the 
sixth day following that of its publication in the Official Journal of the European 
Communities. 
Article 22 
1. Where imports of a product have already been subject to a safeguard measure no 
further such measure shall be applied to that product until a period equal to the 
duration of the previous measure has elapsed. Such period shall not be less than 
two years. 
2. Notwithstanding paragraph 1, a safeguard measure of 180 days or less may be 
reimposed for a product if: 
(a) at least one year has elapsed since the date of introduction of a safeguard 
measure on the import of that product, and 
(b) such a safeguard measure has not been applied to the same product more 
than twice in the five-year period immediately preceding the date of 
introduction of the measure. 
20 
TITLE VI 
Final provisions 
Article 23 
Where the interests of the Community so require, the Council, acting by a qualified 
majority on a proposal from the Commission, may adopt appropriate measures to allow the 
rights and obligations of the Community or of all its Member States, in particular those 
relating to trade in commodities, to be exercised and fulfilled at international level. 
Article 24 
1 This Regulation shall not preclude the fulfilment of obligations arising from special 
rules contained in agreements concluded between the Community and third 
countries. 
2. (a) Without prejudice to other Community provisions, this Regulation shall not 
preclude the adoption or application by Member States: 
(i) of prohibitions, quantitative restrictions or surveillance measures on 
grounds of public morality, public policy or public security; the 
protection of health and life of humans, animals or plants, the 
protection of national treasures possessing artistic, historic or 
archaeological value, or the protection of industrial and commercial 
property; 
(ii) of special formalities concerning foreign exchange; 
(iii) of formalities introduced pursuant to international agreements in 
accordance with the Treaty. 
(b) The Member States shall inform the Commission of the measures or 
formalities they intend to introduce or amend in accordance with this 
paragraph. In the event of extreme urgency, the national measures or 
formalities in question shall be communicated to the Commission 
immediately upon their adoption. 
21 
Article 25 
1. This Regulation shall be without prejudice to the operation of the instruments 
establishing the common organization of agricultural markets or of Community or 
national administrative provisions derived therefrom or of the specific instruments 
applicable to goods resulting from the processing of agricultural products; it shall 
operate by way of complement to those instruments. 
2. However, in the case of products covered by the instruments referred to in 
paragraph 1, Articles 11 to 15 and 22 shall not apply to those in respect of which 
the Community rules on trade with third countries require the production of a 
licence or other import document. 
Articles 16, 18 and 21 to 24 shall not apply to those products in respect of which 
such rules provide for the application of quantitative import restrictions. 
Article 26 
Until 31 December 1995, Spain and Portugal may maintain the quantitative restrictions on 
agricultural products referred to in Articles 77, 81, 244, 249 and 280 of the Act of 
Accession. 
Article 27 
Regulation (EC) No 518/94 is hereby repealed. References to the repealed Regulation shall 
be understood as referring to this Regulation. 
Article 28 
This Regulation shall enter into force on a date determined by a decision on the entry into 
force of the acts implementing the results of the Uruguay Round. 
This Regulation shall be binding in its entirety and directly applicable in all Member 
States. 
^2.3 
ANNEX 
List of particulars to be given in the boxes of the surveillance document 
SURVEILLANCE DOCUMENT 
1. Applicant 
(name, full address, country) 
2. Registration No 
3. Consignor (name, address, country) 
4. Competent authorities of issue 
(name and address) 
5. Declarant (name and address) 
6. Last day of validity 
7. Country of origin 
8. Country of consignment 
9. Proposed place and date of importation 
10. Reference to Regulation (EC) which imposed surveillance 
11. Description of goods, marks and numbers, number and kind of packages 
12. Goods code (CN) 
13. Gross mass (kg) 
14. Net mass (kg) 
15. Additional units 
16. cif value EC frontier in ecu 
17. Further particulars 
18. Certification by the applicant: 
I, the undersigned, certify that the information provided in this application is true and given in good 
faith. 
Date and place 
(signature) (stamp) 
19. Stamp of the competent authorities 
Date 
(signature) (stamp) 
Original for the applicant 
Copy for the competent authorities 
EUROPEAN COMMUNITIES SURVEILLANCE DOCUMENT 13>O 
1. Applicant (name, full address, country) 2. Registration No 
3. Consignor (name, address, country) 4. Competent authorities of issue (name and address) 
S. Declarant (name and address) 
x 
o 6. Last day of validity 
7. Country of origin 8. Country of consignment 
• 9. Proposed place and date of importation 10. Reference to Regulation (EC) which imposed surveillance 
11. Description of goods, marks and numbers, number and kind of packages 12. Goods code (CN) 
13. Gross mass (kg) 
14. Net mass (kg) 
15. Additional units 
16. cif value EC frontier in ecu 
17. Further particulars 
18. Certification by the applicant : 
I. undersigned, certify that the information provided in this application is true and given in good faith 
19. Stamp of the competent authorities 
(signature) Date: 
(stamp) Place and date 
(signature) (stamp) 
EUROPEAN COMMUNITIES SURVEILLANCE DOCUMENT 3>% 
1. Applicant (name, full address, country] 2. Registration No 
3. Consignor (name, address, country) 4. Competent authorities of issue (name and address) 
5. Declarant (name and address) 6. Last day of validity 
7. Country of origin 8. Country of consignment 
9. Proposed place and date of importation 10. Reference to Regulation (EC) which imposed surveillance 
11. Description of goods, marks and numbers, number and kind of packages 12. Goods code (CN) 
13. Gross mass (kg) 
14. Net mass (kg) 
15. Additional units 
16. cif value EC frontier in ecu 
17. Further particulars 
18. Certification by the applicant: 
I. undersigned, certify that the information provided in this application is true and given in good faith 
19. Stamp of the competent authorities 
(signature) Date: 
(stamp) Place and date 
(signature) (stamp) 
Si 2/ 
Commercial defence: 
New Instrument 
%^3 
EXPLANATORY MEMORANDUM 
This proposal amends Regulation 2641/84 on the strengthening of the common 
commercial policy with regard in particular to protection against illicit commercial 
practices. The Council has already amended this Regulation (with Regulation 522/94) 
in order to strengthen the link between this instrument of commercial defence and the 
improved dispute settlement mechanism of the WTO. This purpose has been achieved 
at the procedural level: resort to Regulation 2641/84 (as already amended) will enable 
Community industries and Member States to activate the Community institutions 
(Commission and Council) for the purpose of WTO dispute settlement with all the 
necessary guarantees of transparency and due process, and subject to the control of the 
Court of Justice. 
This new proposal is aimed at pursuing this process further, by making the instrument 
better adapted to the changed nature of WTO dispute settlement (including, but not 
limited to, its applicability to the GATS1 and TRIPs Agreements). In particular, the 
proposed amendments are aimed at dealing with problems created by third country 
illicit commercial practices for Community exporters on foreign markets. A brief 
explanation of the rationale for the proposed changes follows below, together with a 
table summarising the possibilities of action which would exist under this proposed 
Regulation if it were adopted. 
No change is being proposed to the decision-making procedures resulting from the 
amendments already adopted in 1994, except for re-grouping the relevant provisions in 
a more logical order. Thus, this proposal would not result in any modification of the 
respective roles of the Community institutions involved (Commission and Council) and 
of the majority required for the Council to decide on these matters. 
1. Reg. 2641/84 is currently based on two "tracks" : the first gives a Community 
industry the right to complain against foreign "illicit practices" if it suffers 
material injury; the second gives Member States the right to prompt the 
Commumty to act in all cases (including, but not limited to, illicit practices) in 
which the Community has rights under international rules. 
2. The second "track" (i.e. referral of a matter by one or more Member States 
invoking the defense of the Community's international rights) appears now 
satisfactory, after the 1994 amendments. Any further changes should only be 
1 In particular, the notion of "providers of services" has been introduced within the concept of 
"Community industry", to take into account the new rules of the GATS 
^ 
envisaged after its effectiveness has been tested in practice (which will only 
happen after the WTO has entered into force). The first "track" (complaint by a 
Community industry against an "illicit practice"), instead, continues to suffer 
from serious shortcomings, and the renewed interest that many sectors of 
European industry are showing for the WTO and the new rules has highlighted 
these shortcomings. 
3. The first problem lies with the concepts of "Community industry" and of 
"material injury". These were borrowed from existing commercial defence 
instruments, and it continues to make sense to use them in the context of any 
instrument of protection of the Community's domestic market, even though they 
are stricter than what WTO/GATT requires from us. However, most GATT rules 
are based on a test of "adverse effects on trade" which often does not coincide 
with "injury": in general, GATT employs the concept of "nullification or 
impairment" of benefits, which is even presumed (and the presumption is 
practically irrefutable) in cases of violation of GATT rules. Some agreements go 
even further: the new Subsidies Agreement, for instance, expressly provides that 
"material injury" is only one of three possible types of "adverse effects on trade", 
the other ones being "nullification or impairment" in the general GATT sense, 
and "serious prejudice" to a country's interests (cf. Article 5 new Subsidies 
Agreement). 
4. Furthermore, if we consider the effect of foreign trade practices on Community 
exports to third countries (whether to the country applying or maintaining the 
practices in question or to another country), as opposed to imports into the 
Community, very rarely the whole of a Community industry (or a major 
proportion thereof) is concerned. Yet, this does not make the practices in 
question any less objectionable or even illicit. Moreover, the effect of trade 
barriers is often first and foremost to prevent trade from taking place (by 
discouraging potential exporters), even before a trade distortion takes place. 
5. In these circumstances, it makes sense to add a "third track", under which 
Community exporters could prompt the Community to react against objectionable 
or illicit foreign trade practice that affect them in third country markets, while 
leaving untouched the existing "tracks" (the first one, notwithstanding its strict 
limitations, could still be useful for Commumty industries, as regards the 
Community's domestic market; the second "track" contains", of course, the 
general "right of action" for Member States). 
6. The objective of this exercice is not to create an easier way way of applying the 
instrument, but a different one, better suited to a market opening strategy in 
favour of our exporters. Thus, the question is not to relax the conditions for 
standing of the complainant and for the trade effects suffered, but to adapt them 
to an instrument for the opemng of third country market (as opposed to yet 
another instrument for the defence of the Community market, which does not 
appear appropriate in this context). 
1.3S-
Thus, while "Community enterprises", even individually, should have the right to 
lodge a complaint under this new third "track", they would have to show that the 
reasons for the Community to act go beyond the narrow advantage that the 
complaining firm(s) could draw from the Community's international action. 
Moreover, the concept of "material injury" can only be replaced (in respect of 
Community exports) with another concept which also has in-built limitations, so 
that not just any kind of effects would justify the Community's intervention. The 
solution proposed here is to introduce the notion of "adverse trade effects", 
which is strictly linked to how these effects are (or will) be defined through the 
WTO (including through dispute settlement cases), in order to offer a sufficient 
guarantee against "open-ended" actions. A requirement of "material impact" has 
also been added, to enable the Community institutions to weed out frivolous 
actions, and to concentrate on actions which benefit the Community and/or 
Member States beyond the advantages they would bring to the complainant. 
The considerations set out in points 6 through 8 above, together with the 
Community's traditional and well-founded position that market opening and trade 
liberalisation must be pursued within the context of the multilateral trading 
system (as well as with the need to differentiate this instrument, in terms of 
international legality, from section 301) strongly militate in favour of 
strengthening even further the link between this commercial policy instrument 
and international (essentially WTO) trade rules and dispute settlement. 
22 September 1994 
TABLE 
Actions possible under the proposed commercial practices Regulation 
1st track 
(complaint Art. 3) 
2nd track 
(referral Art. 4) 
3rd track 
(complaint Art. 3bis) Complainant 
Community industry 
(or major proportion thereof) 
it now includes providers of services, 
as well as producers of goods 
Member States 
Community enterprises 
(it includes a fortiori the Community 
industry as a whole) 
whether producers of goods 
or providers of services Practice complained of 
illicit practices 
(includes violations of 
GATT/WTO rules) 
exercise of the Community's 
international rights 
(includes any commercial 
practice by a third country) 
any commercial practice 
by a third country Effects to be shown 
material injury 
only those necessary for the action 
being requested 
(e.g. "nullification or impairment" or 
other adverse trade effects in GATT 
"non-violation" cases) 
adverse trade effects 
(defined by the international rules 
being invoked: in GATT/WTO terms it 
includes both "violation" and "non­
violation" cases) 
includes a requirement of "material 
impact" on the Community Market where the effects 
take place 
Community market or a third 
country market 
Community market or a third 
country market 
market of a third country 
(including that of the country 
applying or maintaining the 
practice complained of) 
0^ 
~X\ 
ANNEX 
Description of the changes Article by Article 
Article 1: Aims 
The notion of "adverse trade effects" resulting from any commercial practice has been 
introduced, alongside those of "injury" resulting from an illicit commercial practice 
and of "exercise of Community's rights". The notion of "adverse trade effects" is 
defined later on, in Article 2. 
Article 2: Definitions 
1. The notion of "providers of services" has been introduced within the concept of 
"Community industry", to take into account the new rules of the GATS. 
2. The concept of "regional injury" (paragraph 4 (b)) has been reduced to the case 
of imports into a region of the Community because, apart from the fact that the 
case of injury caused to a "regional exporting industry" is at best marginal, it 
would in any event be taken care of by the new "track". 
3. The notion of adverse trade effects" is defined (in paragraph 5), and strictly 
linked to a "right of action" under international trade law (essentially WTO, 
therefore) in respect of trade in goods and/or services. The fact that the effects 
complained of must be "typified" under international rules offers a sufficient 
guarantee against "open-ended" actions, and can therefore permit this right to 
complain to encompass both "violation" cases ("illicit practices") and "non­
violation" cases (trade practices which are not "illicit" but which can 
nevertheless be attacked through GATT/WTO dispute settlement on the basis of 
their trade effects: a typical example are domestic subsidies). 
The notion also includes a requirement of "material impact", which would 
enable the Community institutions to weed out, frivolous actions, and to 
concentrate on actions which benefit the Community and/or Member States 
beyond the advantages they would bring to the complainant. 
4. The notion of "Community enterprises", as those who have a right to lodge a 
complaint under this "third track" when they have suffered from "adverse trade 
effects", has been introduced (in paragraph 6). The actual language of this 
provision may need to be reviewed in consultation with the Legal Service, to 
make sure that it is consistent with the same concept as used in other areas of 
Community law. 
Article 3: Complaint 
This Article has been split, in fact, into three separate provisions : 
Article 3 confirms the right of a Community industry to complain against illicit 
practices which have caused it to suffer material injury ("first track"). 
Article 3bis introduces the right of Community enterprises to complain when 
they have suffered from adverse trade effects in the two cases mentioned above 
("third track"). 
Article 3ter lays down the procedures to be followed in respect of either of such 
complaints when they are lodged with the Commission. The provision on the 
deadline for a decision on whether to open an examination procedure or not has 
been moved here (from the end of Article 6), and amended to shorten the 
deadline to 45 days in all cases, except where the complainant itself prefers to 
integrate the complaint with more information rather than risk a negative 
decision. 
Article 4: Referral by a Member State 
1. This Article maintains the general right of complaint for Member States in all 
circumstances ("second track") and clarifies that it includes the case of "adverse 
trade effects". 
2. It further clarifies that Member States must only supply "sufficient" evidence 
(since this is a pre-initiation stage of the procedure), and that such evidence 
must refer to all the elements of the referral: the commercial practice 
complained of (whether or not it is an illicit one) and any resulting effects 
which may be necessary to allege in an international action, e.g. under WTO 
dispute settlement procedures. 
3. Finally, a provision introducing a firm 45 days deadline (modelled on that 
provided for complaints by the Community industry or Commumty enterprises) 
has been added, to guarantee Member States prompt examination of their 
requests. 
Article 5: Consultation procedure (unchanged^ 
Article 6Î Community examination procedure 
Paragraph 8 has been deleted, and corresponding provisions have been inserted in 
Articles 3 ter and 4. , 
-llî 
Article 7: Confidentiality (unchanged) 
Article 8: Evidence 
1. The existing provisions of the Article have been amended to conform to the 
changes described above. 
2. The meaning of "adverse trade effects", in terms of the economic impact of a 
foreign trade practice, is further clarified (in paragraph 4). 
3. , The link between adverse trade effects and a GATT/WTO right of action is also 
further clarified, in terms of evidence which has to be provided by the parties 
and examined by the Commission (in paragraph 5). In particular, this 
provisions is meant to ensure that when no evidence of adverse trade effects is 
necessary for an international action (eTg. in a GATT/WTO "violation" case, 
where such effects are presumed according to consolidated GATT 
"jurisprudence"), the Commission can take this into account when evaluating 
the evidence, either at the stage of a complaint/referral, or of the investigation. 
4. The non-exhaustive nature of any evidentiary requirements listed in this Article 
has been further clarified (in paragraph 6). The formula employed comes from 
the provisions on injury in AD and CVD (under both the existing Codes and the 
New Agreements). 
5. The title has been changed to reflect the above; 
Article 9: Termination of the procedure 
1. Paragraph 2(a) has been amended to make it clear that this type of termination 
of the procedure does not require any Community action. The reference to 
Article 11 was confusing because, in fact, Article 11 provided for the 
application of Article 12 to decisions under Article 9, paragraph 2(a). 
2. The amendment to paragraph 2(c) is purely stylistical. 
Article 10: Adoption of commercial policy measures 
1. A reference to the "third track" has been included (paragraph 1). 
2. A link between the measures that the Commission would eventually propose to 
the Council (if necessary) and those which can be authorised by the WTO 
dispute settlement body ("DSB") in case of non-implementation of a panel's 
report has been made more explicit (in paragraph 2). 
\ ^o 
Article 11: Decision-making procedures 
The text of this Article is that which results from Regulation 522/94, and the changes 
proposed here are meant to clarify the language, but not to modify the substance of the 
1994 amendment. The title of the Article has also been modified for the same reason. 
Article 12: Committee procedure 
A title has been introduced for case of reference to this Article. (The same has been 
done for Articles 13 and 14). 
Article 13: General provisions 
Beside the introduction of a title, a provision has been added repealing the original 
Regulation 2641/84 and its 1994 amendment (Reg. 522/94) and replacing them entirely 
with this new Regulation. 
Article 14: Entry into force 
The formula employed here has been suggested by the Legal Service for all the 
elements of the U.R. Implementing package. 
un 
Proposal for a 
94/ 0233(ACC) 
Council Regulation (EC) No. ( ) 
on the strengthening of the common commercial policy, in particular with regard to protection 
against illicit commercial practices and adverse trade effects suffered by Community enterprises, 
and to the exercise of the Community's rights under international trade rules; 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, and in particular Article 113 thereof, 
Having regard to the rules establishing the common organisation of agricultural markets and the rules 
adopted under Article 235 of the Treaty, applicable to goods processed from agricultural products, and in 
particular those provisions thereof, which allow for derogation from the general principle that any 
quantitative restriction or measure having equivalent effect may be replaced solely by the measures 
provided for in those instruments, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the common commercial policy must be based on uniform principles, notably with regard to 
commercial defence; 
Whereas Council Regulation (EC) No ( ) on protection against dumped imports from countries not 
members of the European Community, Council Regulation (EC) No ( ) on protection against subsidised 
imports from countries not members of the European Community, Council Regulation (EC) No 518/94 on 
common rules for imports, and Council Regulation (EC) No 519/94 on common rules for imports from 
certain third countries constitute important components of the Community's system of commercial 
defence; 
Whereas such instruments are based on common concepts, notably the injury caused to a Community 
industry, and this concept appears appropriate in the context of any instrument of legitimate protection of 
the Community's domestic market; 
Whereas the Council Regulation (EEC) No 2641/84 had provided the Community with procedures 
enabling it : 
to respond to any illicit commercial practice with a view to removing the injury resulting 
therefrom, and 
to ensure full exercise of the Community's rights with regard to the commercial practices 
of third countries; 
Whereas, following conclusion of the Uruguay Round Multilateral Trade Negotiations and the perspective 
creation of a World Trade Organisation ("WTO") which lays down new and improved procedures for the 
settlement of trade disputes among countries Members of the WTO, Council Regulation (EC) No 522/94 
had made it clear that the procedures laid down in Regulation 2641/94 were the most appropriate for the 
Community industry and for Member States to prompt Community action under the WTO dispute 
settlement mechanism in order to respond to illicit commercial practices and/or to ensure full exercise of 
the Community's rights (as appropriate); 
Whereas the experience in the application of Regulation 2641/84 has shown that the concepts of 
Community industry and of injury appear inadequate to enable the Community, its Member States and its 
enterprises to react to commercial practices (whether or not illicit) of third countries when the effects of 
such practices are felt on the market of any third country not member of the European Community (which 
may be the market of the country applying or maintaining the practice in question pr the market of another 
country); 
Whereas the Uruguay Round Agreement establishing the WTO ("WTO Agreement") not only improves 
and develops international rules concerning trade in goods, but establishes a General Agreement on Trade 
m Services ("GATS") and an Agreement on Trade-Related Intellectual property matters ("TRIPs 
Agreement"), and that such Agreements also fall within the scope of the WTO dispute settlement 
mechanism; 
Whereas for those reasons it appears appropriate to maintain and improve the procedures laid down in 
Regulation 2641/84, as amended by Regulation 522/94; 
Whereas in this context protection in relation to the Community's domestic market should continue to be 
granted to a Community industry suffering from material injury caused by illicit commercial practices; 
'^.ï 
Whereas it is nevertheless appropriate to clarify that a Community industry can also be comprised of 
providers of services, as well as producers of goods; 
Whereas Member States should continue to have access to these procedures in respect of all matters 
concerning commercial policy and the trade practices (whether or not illicit) of third countries, in order to 
ensure full exercise of the Community's rights; 
Whereas it is desirable to provide the Community with the means to operate effectively in the direction of 
further trade liberalisation through the application of international trade rules, in particular those laid down 
in the Annexes to the WTO Agreement; 
Whereas, to this end, it is advisable to provide Community enterprises with the means to react to trade 
practices which prevent them (wholly or partially) from trading with countries outside the Community, 
provided that such practices give rise to the Community's right to action under applicable international 
trade rules; 
Whereas it appears therefore appropriate to further amend Regulation 2641/84 accordingly; 
Whereas it is also appropriate to confirm that the Community must act in compliance with its international 
obligations and, where such obligations result from agreements, maintain the balance of rights and 
obligations which it is the purpose of those agreements to establish; 
Whereas it is also appropriate to confirm that any measures taken under the procedures in question should 
also be in conformity with the Community's international obligations, as well as being without prejudice to 
other measures in cases not covered by this Regulation which might be adopted directly pursuant to Article 
113 of the Treaty; 
Whereas it should be confirmed that, for the purposes of implementing this Regulation, there should be 
close co-operation between the Member States and the Commission, in particular through consultations 
within the advisory committee, as well as through the information of the Committee established by Article 
113 of the Treaty; 
Whereas the rules of procedures to be followed during the examination procedure provided for in this 
Regulation should also be confirmed, in particular as regards the rights and obligations of the Community 
authorities and the parties involved, and the conditions under which interested parties may have access to 
information and may ask to be informed of the essential facts and considerations resulting from the 
examination procedure; 
"M 
Whereas in acting under this Regulation the Community has to bear in mind the need for rapid and 
effective action, through the application of the decision-making procedures provided for in the Regulation; 
HAS ADOPTED THIS REGULATION : 
Article 1 
Aims 
This Regulation establishes procedures in the matter of commercial policy which, subject to compliance 
with existing international obligations and procedures, are aimed at: 
(a) responding to any illicit commercial practice with a view to removing the injury resulting therefrom; 
(b) responding to any commercial practice (whether or not illicit) with a view to removing the adverse 
trade effects resulting therefrom; 
(c) ensuring full exercise of the Community's rights with regard to the commercial practices of third 
countries. 
7/ shall be applied in particular to the initiation and subsequent conduct and termination of international 
dispute settlement procedures in the area of common commercial policy. 
Article 2 
Definitions 
1. For the purposes of this Regulation, illicit commercial practices shall be any international trade 
practice attributable to third countries which are incompatible with international law or with the generally 
accepted rules. 
2. For the purposes of this Regulation, the Community's rights shall be those international trade rights of 
which it may avail itself either under international law or under generally accepted rules. 
^ 
3. For the purposes of this Regulation, injury shall be any material injury caused or threatened to 
Community industry. 
4. The term 'Community industry' shall be taken to mean all Community producers or providers, 
respectively: 
of products or services identical or similar to the product or service which is the subject of illicit 
practices or 
of products or services competing directly with that product or service, or 
who are consumers or processors of the product or consumers or users of the service which is the 
subject of illicit practices, 
or all those producers or providers whose combined output constitutes a major proportion of total 
Community production of the products or services in question; however: 
(a) when producers or providers are related to the exporters or importers or are themselves importers of 
the product or service alleged to be the subject of illicit practices, the term 'Community industry' may 
be interpreted as referring to the rest of the producers or providers; 
(b) in particular circumstances, the producers or providers within a region of the Community may be 
regarded as the Community industry if their collective output constitutes the major proportion of the 
output of the product or service in question in the Member State or Member State within which the 
region is located provided that where the illicit practice concerns imports into the Community, their 
effect is concentrated in that Member State or those Member States. 
5. For the purposes of this Regulation, adverse trade effects shall be those 
which are felt, in respect of a product or service, on the market of any country non Member of the 
European Community, and 
which could give rise to actions under relevant international rules, whether as a result of an illicit 
commercial practice or otherwise, 
and which have a material impact, actual or potential, on the economy of the Community or of a 
region of the Community, or on a sector of economic activity therein. 
Adverse trade effects shall also include cases where trade flows, concerning a product or service, are 
prevented, impeded or diverted as a result of any commercial practice, as well as cases where any 
commercial practice has materially affected the supply or inputs (e.g. parts and components or raw 
materials) to Community enterprises. Adverse trade effects shall also include threat of such effects. 
2 V6 
6. The term "Community enterprise" shall be taken to mean any natural or legal person having an 
established presence within the Community for the purpose of carrying out an economic activity 
concerning the production of goods or the provision of services. 
Article 3 
Complaint on behalf of the. Community industry 
1. Any natural or legal person, or any association not having legal personality, acting on behalf of a 
Community industry which considers that it has suffered injury as a result of illicit commercial practices 
may lodge a written complaint. 
2. The complaint must contain sufficient evidence of the existence of illicit commercial practices and the 
injury resulting therefrom. Evidence of injury must be given on the basis of the factors indicated in Article 
8. 
Article 3 bis 
Complaint on behalf of Community enterprises 
1. Any Community enterprise, or any association, having or not legal personality, acting on behalf of 
one or more Community enterprises, which considers that such Community enterprises have been 
materially affected by adverse trade effects within the meaning of paragraph 5 of Article 2 of this 
Regulation, may lodge a written complaint. 
2. The complaint must contain sufficient evidence of the existence of commercial practices (whether or 
not illicit) and of adverse trade effects, resulting therefrom. Evidence of adverse trade effects must be given 
on the basis of the factors indicated in Article 8. 
-o i\uio 
^> 
Article 3 ter 
Complaint procedures 
1. The complaint shall be submitted to the Commission, which shall send a copy thereof to the Member 
States. 
2 The complaint may be withdrawn, in which case the procedure may be terminated unless such 
termination would not be in the interests of the Community. 
3. Where it becomes apparent after consultation that the complaint does not provide sufficient evidence 
to justify initiating an investigation, then the complainant shall be so informed. 
4. The Commission shall take a decision as soon as possible on the opening of a Community 
examination procedure following any complaint made in accordance with Articles 3 or 3 bis; the decision 
shall normally be taken within 45 days of the lodging of the complaint; this period may be suspended at the 
request, or with the agreement, of the complainant, in order to allow the provision of complementary 
information which may be needed to fully assess the validity of the complainant's case. 
Article 4 
Referral by a Member State 
1. Any Member State may ask the Commission to initiate the procedures referred to in Article 1. 
2. It shall supply the Commission with sufficient evidence to support its request, as regards commercial 
practices of third countries and, where appropriate, of any effects resulting therefrom. Where evidence of 
injury or of adverse trade effects is appropriate, it must be given on the basis of the factors indicated in 
Article 8. 
3. The Commission shall notify the other Member States of the requests without delay. 
4. Where it becomes apparent after consultation that the request does not provide sufficient evidence to 
justify initiating an investigation, then the Member State shall be so informed. 
A't 
5. The Commission shall take a decision as soon as possible on the opening of a Community 
examination procedure following any referral by a Member State made in accordance with Article 4; the 
decision shall normally be taken within 45 days of the referral; this period may be suspended at the request, 
or with the agreement, of the referring Member State, in order to allow the provision of complementary 
information which may be needed to fully assess the validity of the case presented by the referring Member 
State. 
Article 5 
Consultation procedure 
1. For the purpose of consultations pursuant to this Regulation, an advisory committee, hereinafter 
referred to as 'the Committee', is hereby set up and shall consist of representatives of each Member State, 
with a representative of the Commission as chairman. 
2. Consultations shall be initiated at the request of a Member State or on the initiative of the 
Commission. The chairman of the Committee shall provide the Member States, as promptly as possible, 
with all relevant information in his possession. He shall also inform the Article 113 Special Committee 
thereof. 
3. The Committee shall meet when convened by its chairman. 
4. Where necessary, consultations may be in writing. In such case the Commission shall notify in writing 
the Member States who, within a period of eight working days from such notification, shall be entitled to 
express their opinions in writing or to request oral consultations. 
Article 6 
Community examination procedure 
1. Where, after consultation, it is apparent to the Commission that there is sufficient evidence to justify 
initiating an examination procedure and that it is necessary in the interest of the Community, the 
Commission shall act as follows: 
(a) it shall announce the initiation of an examination procedure in the Official Journal of the European 
Communities; such announcement shall indicate the product and countries concerned, give a summary 
of the information received, and provide that all relevant information is to be communicated to the 
Commission; it shall state the period within which interested parties may apply to be heard orally by 
the Commission in accordance with paragraph 5; \if,5 
l£® 
10 
(b) it shall so officially notify the representatives of the country or countries which are the subject of the 
procedure, with whom, where appropriate, consultations may be held; 
(c) it shall conduct the examination at Community level, acting in co-operation with the Member States. 
2. (a) If necessary, and notably in cases of allegations of illicit commercial practices, the Commission 
shall seek all the information it deems necessary and attempt to check this information with the 
importers, traders, agents, producers, trade associations and organisations, provided that the 
undertakings or organisations concerned give their consent. 
(b) . Where necessary, the Commission shall carry out investigations in the territory of third countries, 
provided that the governments of the countries concerned have been officially notified and raise 
no objection within a reasonable period. 
(c) The Commission shall be assisted in its investigation by officials of the Member State in whose 
territory the checks are carried out, provided that the Member State in question so requests. 
3. Member States shall supply the Commission, upon request, with all information necessary for the 
examination, in accordance with the detailed arrangements laid down by the Commission. 
4. (a) The complainants and the exporters and importers concerned, as well as the representatives of 
the principal exporting or importing country or countries concerned, may inspect all information 
made available to the Commission except for internal documents for the use of the Commission 
and the administrations, provided that such information is relevant to the protection of their 
interests and not confidential within the meaning of Article 7 and that it is used by the 
Commission in its examination procedure. The persons concerned shall address a reasoned 
request in writing to the Commission, indicating the information required. 
(b) The complainants and the exporters and importers concerned and the representatives of the 
principal exporting of importing country or countries concerned may ask to be informed of the 
principal facts and considerations resulting from the examination procedure. 
5. The Commission may hear the parties concerned. It shall hear them if they have, within the period 
prescribed in the notice published in the Official Journal of the European Communities, made a written 
request for a hearing showing that they are a party primarily concerned by the result of the procedure. 
11 
6. Furthermore, the Commission shall, on request, give the parties primarily concerned an opportunity to 
meet, so that opposing views may be presented and any rebuttal argument put forward. In providing this 
opportunity the Commission shall take account of the wishes of the parties and of the need to preserve 
confidentiality. There shall be no obligation on any party to attend a meeting and failure to do so shall not 
be prejudicial to that party's case. 
7. When the information requested by the Commission is not supplied within a reasonable time or where 
the investigation is significantly impeded, findings may be made on the basis of the facts available. 
8. When it has concluded its examination the Commission shall report to the Committee. The report 
should normally be presented within five months of the announcement of initiation of the procedure, unless 
the complexity of the examination is such that the Commission extends the period to seven months. 
Article 7 
Confidentiality 
1. Information received pursuant to this Regulation shall be used only for the purpose for which it was 
requested. 
2. (a) Neither the Council, nor the Commission, nor Member States, nor the officials of any of these, 
shall reveal any information of a confidential nature received pursuant to this Regulation, or any 
information provided on a confidential basis by a party to an examination procedure, without 
specific permission from the party submitting such information. 
(b) Each request for confidential treatment shall indicate why the information is confidential and 
shall be accompanied by a non-confidential summary of the information or a statement of the 
reasons why the inforrnation in not susceptible of such summary. 
3. Information will normally be considered to be confidential if its disclosure is likely to have a 
significantly adverse effect upon the supplier or the source of such information. 
4. However, if it appears that a request for confidentiality is not warranted and if the supplier is either 
unwilling to make the information public or to authorise its disclosure in generalised or summary form, the 
information in question may be disregarded. 
kx 
12 
5. This Article shall not preclude the disclosure of general information by the Community authorities and 
in particular of the reasons on which decisions taken pursuant to this Regulation are based. Such disclosure 
must take into account the legitimate interest of the parties concerned that their business secrets should not 
be divulged. 
Article 8 
Evidence 
1. An examination of injury shall involve in particular the following factors: 
(a) the volume of Community imports or exports concerned, notably where there has been a significant 
increase or decrease, either in absolute terms or relative to production or consumption on the, market 
in question; 
(b) the prices of the Community industry's competitors, in particular in order to determine whether there 
has been, either in the Community or on third country markets, significant undercutting of the prices 
of the Community industry; 
(c) the consequent impact on the Community industry and as indicated by trends in certain economic 
factors such as: 
production, 
utilisation of capacity, 
stocks, 
sales, 
market share, 
prices (that is, depression of prices or prevention of price increases which would normally have 
occurred), 
profits, 
- return on capital, / 
investment, 
employment. 
^ 
13 
2. Where a threat of injury is alleged, the Commission shall also examine whether it is clearly 
foreseeable that a particular situation is likely to develop into actual injury. In this regard, account may also 
be taken of factors such as: 
(a) the rate of increase of exports to the market where the competition with Community products is taking 
place; 
(b) export capacity in the country of origin or export, which is already in existence or will be operational 
in the foreseeable future, and the likelihood that the exports resulting from that capacity will be to the 
market referred to in point (a). 
3. Injury caused by other factors which, either individually or in combination, are also adversely 
affecting Community industry must not be attributed to the practices under consideration. 
4. Where adverse trade effects within the meaning of paragraph 5 of Article 2 of this Regulation are 
alleged, the Commission shall examine the impact of such adverse effects, actual or potential, on the 
economy of the Community or of a region of the Community, or on a sector of economic activity therein. 
To this effect, the Commission may take into account, where relevant, factors of the type listed in 
paragraphs 1 and 2 above, as well as the impact on the current and future competitiveness of the 
Community and of its Member States, including in terms of technological advance. 
5. The Commission shall also, in examining evidence of adverse trade effects, have regard to the 
provisions, principles or practice which govern the right of action under relevant international rules 
referred to in paragraph 5 of Article 2 of this Regulation. 
6. The Commission shall further examine any other relevant evidence contained in the complaint or in 
the referral. In this respect, the list of factors and the indications given jn paragraphs 1 to 5 above are not 
exhaustive, nor can one or several of such factors and indications necessarily give decisive guidance as to 
the existence of injury or of adverse trade effects. 
Article 9 
Termination of the procedure 
1. When it is found as a result of the examination procedure that the interests of the Community do not 
require any action to be taken, the procedure shall be terminated in accordance with Article 12. 
14 
2. (a) When, after an examination procedure, the third country or countries concerned take(s) measures 
which are considered satisfactory, and therefore no action by the Community is required, the 
procedure may also be terminated in accordance with the provisions of Article 12. 
(b) The Commission shall supervise the application of these measures, where appropriate on the 
basis of information supplied at intervals, which it may request from the third countries 
concerned and check as necessary. 
(c) Where the measures taken by the third country or countries concerned have been rescinded, 
suspended or improperly implemented or where the Commission has grounds for believing this 
to be the case or, finally, where a request for information made by the Commission as provided 
for by point (b) has not been granted, the Commission shall inform the Member States, and 
where necessary and justified by the results of the investigation and the new facts available any 
measures shall be taken in accordance with paragraph 3 of Article 11. 3-</ 
Article 10 
Adoption of commercial policy measures 
1. Unless the factual and legal situation is such that an examination procedure may not be required, 
where it is found as a result of the examination procedure, that action is necessary in the interests of the 
Community in order to: 
(a) respond to any illicit commercial practice with the aim of removing the injury resulting therefrom; or 
(b) ensure the removal of adverse trade effects suffered by Community enterprises; or 
(c) ensure full exercise of the Community's rights with regard to the commercial practices of third 
countries. 
the appropriate measures shall be determined in accordance with the procedure set out in Article 11. 
3£T 
15 
2. Where the Community's international obligations require the prior discharge of an international 
procedure for consultation or for the settlement of disputes, the measures referred to in paragraph 3 shall 
only be decided on after that procedure has been terminated, and taking account of the results of the 
procedure. In particular, where the Community has requested an international dispute settlement body to 
indicate and authorize the measures which are appropriate for the implementation of the results of an 
international dispute settlement procedure, the Community commercial policy measures which may be 
needed in consequence of such authorization shall be compatible with those recommended by such 
international dispute settlement body. \t 
3. Any commercial policy measures may be taken which are compatible with existing international 
obligations and procedures, notably: 
(a) suspension or withdrawal of any concession resulting from commercial policy negotiations; 
(b) the raising of existing customs duties or the introduction of any other charge on imports; 
(c) the introduction of quantitative restrictions or any other measures modifying import or export 
conditions or otherwise affecting trade with the third country concerned. 
4. The corresponding decisions shall state the reasons on which they are based and shall be published in 
the Official Journal of the European Communities. Publication shall also be deemed to constitute 
i ' ' • ....-•- • 
notification to the countries and parties primarily concerned. 
Article 11 , 
Decision-makingprocedures 
1. The decisions referred to in paragraphs 1 and 2(a) of Article 9 shall be adopted in accordance with 
the provisions of Article 12. 
2. Where the Community follows formal international consultation or dispute settlement procedures, 
decisions relating to the initiation, conductor termination of such procedures shall be taken in accordance 
with Article! 2. 
16 
3. Where the Community, having acted in accordance with paragraph 2 of Article 10 of this Regulation, 
has to take a decision on the measures of commercial policy to be adopted under paragraph 2(c) of Article 
9 or under Article 10, thé Council shall act, in accordance with Article 113 of the Treaty, by a qualified 
majority, not later than 30 working days after receiving the proposal. ^ 
Article 12 
Committee procedure 
Should reference be made to the procedure provided for in this Article, the matter shall be brought before 
the Committee by its chairman. 
The Commission representative shall submit to the Committee a draft of the decision to be taken. The 
Committee shall discuss the matter within a period to be fixed by the chairman, depending on the urgency 
of the matter. 
The Commission shall adopt a decision which it shall communicate to the Member States and which shall 
apply after a period of 10 days if during this period no Member State has referred the matter to the Council. 
The Council may, at the request of a Member State and acting by a qualified majority revise the 
Commission's decision. 
The Commission's decision shall apply after a period of 30 days if the Council has not given a ruling within 
this period, calculated from the day on which the matter was referred to the Council. 
Article 13 
General previsions 
1. This Regulation shall not apply in cases covered by other existing rules in the common commercial 
policy field. It shall operate by way of complement to the: 
rules establishing the common organisation of agricultural markets and their implementing provisions; 
17 
specific rules adopted under Article 235 of the Treaty, applicable to goods processed from agricultural 
products. 
It shall be without prejudice to other measures which may be taken pursuant to Article 113 of the Treaty. 
2. Regulation (EEC) No. 2641/84, as amended by Regulation (EC) No. 522/94 is hereby repealed. 
References to the repealed Regulation shall be construed as references to this Regulation. 
Article 14 
Entry into force 
1. This Regulation shall enter into force on the date determined by a decision governing the entry into 
force of the acts implementing the results of the Uruguay Round. 
2. This Regulation shall be binding in its entirety and directly applicable in all Member States. *> 
1st 
Part 7 
Intellectual property 
iiA 
TRIPs MODIFICATIONS IN COMMUNITY LAW 
**>(>: 
EXPLANATORY MEMORANDUM 
FOR TRIPs MODIFICATIONS IN COMMUNITY LAW 
I. INTRODUCTION 
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) 
concluded within the framework of the Uruguay Round negotiations contains provisions 
on the protection of intellectual property rights, in particular with the purpose of 
establishing international disciplines in this area in order to promote international trade 
and to prevent trade distortions due to the lack of adequate and effective intellectual 
property protection. 
The TRIPs Agreement, in addition to establishing general provisions and basic principles 
on the protection of intellectual property rights, provides for standards concerning the 
availability, scope and use of intellectual property rights, notably: 
copyright and related rights; 
trademarks; 
geographical indications; 
industrial designs; 
patents; 
layout-designs (topographies) of integrated circuits; 
protection of undisclosed information; and 
contains also provisions on the control of anti-competitive practices in contractual 
licences. 
These standards are to be enforced domestically on the basis of detailed provisions, 
including special requirements related to border measures; the acquisition and 
maintenance of intellectual property rights and related civel and criminal law procedures. 
This proposal for a Council Regulation contains proposals to amend those Community 
acts which have to be modified in order to implement in Community law the provisions 
of the TRIPs Agreement. Reference is also made in this Explanatory Memorandum to 
current proposals of Community acts submitted by the Commission to the 
Council/Parliament which would also have to be amended in order to bring them into line 
with the requirements of the TRIPs Agreement. 
The present proposal does not concern those areas of current Member State legislation 
which would have to be amended to implement the TRIPs Agreement. In this respect, 
consultations between Member States and the Commission seem necessary in order to 
ensure that such modifications of Member State legislation be undertaken against the 
background of a common analysis of the implication and interpretation of the TRIPs 
Agreement. 
T>H 
II. TRADEMARKS 
Legislation: Council Regulation (EC) 40/94 of 20 December 1993 on the Community 
Trademark1. 
Article 5 of Council Regulation 40/94 defines the "Persons who can be proprietors of 
Community Trademarks". This Article, which notably refers to the Paris Convention for 
the Protection of Industrial Property, implements in paragraph 1, subparagraphs (a) and 
(b), the principle of national treatment as regards nationals and domiciliaries of a State 
party to this Convention. 
Nevertheless, Article 5, paragraph 1, subparagraph (d), of this Regulation basically 
subjects the granting of national treatment to nationals of States not parties to the Paris 
Convention to the requirement of reciprocal national treatment in their country of origin 
for nationals of the Member States. Art. 29, paragraph 5, of this Regulation, concerning 
the right of priority, contains a similar requirement in relation to filings made in a State 
which is not a party to the Paris Convention.. 
In order to comply with the national treatment obligation in Article 3 of the TRIPs 
Agreement, these provisions should be modified to ensure that nationals of all WTO 
Members, even if the Member in question is not a party to the Paris Convention, receive a 
treatment no less favourable than that accorded to nationals of Community Member 
States. 
III. GEOGRAPHICAL INDICATIONS 
Insofar as the protection of geographical indications for wines and spirits as foreseen in 
Article 23 TRIPs is concerned, the relevant amendments to Council Regulation 822/87 of 
16 March 1987, Council Regulation 1601/91 of 10 June 1991, both of them concerning 
wines, and Council Regulation 1576/89 of 29 May 1989 concerning spirit drinks, are 
dealt with in the part on agriculture. 
IV. LAYOUT-DESIGNS OF INTEGRATED CIRCUITS 
Legislation: Council Directive 87/54/EEC of 16 December 1986 on the Legal 
Protection of Topographies of Semiconductor Products2. 
Articles 35 to 38 of the TRIPs Agreement set out the obligations of WTO Members in 
relation to the protection of layout-designs (topographies) of integrated circuits. In 
accordance with these Articles, the Community should ensure that nationals of all other 
WTO Members benefit from such protection. The Commission proposes to extend the 
protection of topographies of integrated circuits, as required by the TRIPs Agreement, to 
nationals of all WTO Members. 
1 OJL 1L 14.1.1994 
2OJ L24. 27.1.1987 
ZGL 
V. PROPOSED COMMUNITY LEGISLATION 
In addition to amending existing Community legislation in order to bring it in line with the 
TRIPs Agreement, the Commission will need to ensure that current Community proposals 
in the diferent fields of intellectual property rights protection are in conformity with the 
TRIPs Agreement. 
V 
•}É>3 
PROPOSAL FOR A COUNCIL REGULATION (EC) No /94 
of 1994 
94/ 0234(CNS) 
amending Council Regulation (EC) No 40/94 of 20 December 1993 
on the Community trademark for the implementation of the agreements concluded 
in the framework of the Uruguay Round 
THE COUNCIL OF THE EUROPEAN UNION 
Having regard to the Treaty establishing the European Community and in particular 
Article 235 thereof, 
Having regard to the proposal by the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas the Agreement establishing the World Trade Organization (hereinafter, the 
WTO Agreement) was signed on behalf of the Community; whereas the Agreement on 
Trade-Related Aspects of Intellectual Property Rights (hereinafter, the TRIPs 
Agreement), annexed to the WTO Agreement, contains detailed provisions on the 
protection of intellectual property rights whose purpose is the establishment of 
international disciplines in this area in order to promote international trade and prevent 
trade distortions and friction due to the lack of adequate and effective intellectual 
property protection; 
Whereas in order to ensure that all relevant Community legislation is in full compliance 
with the TRIPs Agreement, the Community must take certain measures in relation to 
current Community acts on the protection of intellectual property rights; whereas these 
measures entail in some respects the amendment or modification of Community acts; 
whereas these measures also entail complementing current community acts; 
Whereas Council Regulation (EC) 40/94 of 20 December 1993 creates the Community 
Trademark1; whereas Article 5 of Council Regulation 40/94 defines the "Persons who can 
be proprietors of Community Trademarks" by referring notably to the Paris Convention 
for the Protection of Industrial Property and requires reciprocal national treatment fron* 
countries which are not parties to the Paris Convention; whereas Article 29 of Regulation 
40/94, concerning the right of priority, also needs to be amended in this respect; whereas 
in order to comply with the national treatment obligation in Article 3 of the TRIPs 
Agreement, these provisions should be modified to ensure that nationals of all WTO 
Members, even if the Member in question is not a party to the Paris Convention, receive 
1 OJL 11, 14.1.1994, p. 1 
g:\raithra\public\ip\940726b 
TJtL/ 
a treatment no less favourable than that accorded to nationals of Community Member 
States. 
HAS ADOPTED THIS REGULATION 
Article 1 
Article 5 of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community 
trade mark, paragraph 1, subparagraph (b), is replaced by the following text: 
"(b) nationals of other States which are parties to the Paris Convention for the 
protection of industrial property, hereinafter referred to as "the Paris Convention'/, 
or to the Agreement establishing the World Trade Organisation;". 
Article 2 
Article 5 of Council Regulation (EC) No 40/94 of 20 December 1993 on the Community 
trade mark, paragraph 1, subparagraph (d), is replaced by the following text: 
"(d) nationals, other than those referred to under subparagraph (c), of any State 
which is not party to the Paris convention or to the Agreement establishing the 
World Trade Organisation and which, according to published findings, accords to 
nationals of all the Member States the same protection for trade marks as it 
accords to its own nationals and, if nationals of the Member States are required to 
prove registration in the country of origin, recognises the registration of 
Community trade marks as such proof.". 
Article 3 
~- • urnrnr • • " 
Article 29 of Council Regulation (EC) No 40/94 of 20 December 1993 on the 
Community trade mark, paragraph 1, is replaced by the following text: 
" 1. A person who has duly filed an application for a trademark in or for any State 
party to the Paris Convention or to the Agreement establishing the World Trade 
Organisation, or his successors in title, shall enjoy, for the purpose of filing a 
Community trade mark application for the same trade mark in respect of goods or 
services which are identical with or contained within those for which the 
application has been filed, a right of priority during a period of six months from 
the date of filing of the first application". 
Article 4 
Article 29^ of Council Regulation (EC) No 40/94 of 20 December 1993 on die 
Community trade mark, paragraph 5, is replaced by the following text: 
"5. If the first filing has been made in a State which is not a party to the Pari * 
Convention or to the Agreement establishing the World Trade Organisât iou, 
paragraphs 1 to 4 shall apply only in so far as that State, according to pu!> ; !v .i 
g:\raithra\public\ip\940726b 
}«• 
findings, grants, on the basis of the first filing made at the Office and subject to 
conditions equivalent to those laid down in this Regulation, a right of priority 
having equivalent effect". 
Article 5 
1. This regulation shall enter into force on the date determined by the decision on the 
entry into force of the acts implementing the results of the Uruguay Round. 
2. It shall be applicable as of 1 January 1996. 
This Regulation shall be binding in its entirety and directly applicable in all Member 
States. 
Done in Brussels, __ 1994 
For the Council 
The President 
i.nmu,m<' 
g:\raithra\public\ip\940726b ~f~ 
~l<4> 
PROPOSAL FOR A COUNCIL DECISION 
on the extension of the legal protection of topographies of semiconductor products 
to persons from a Member of the World Trade Organisation 
THE COUNCIL OF THE EUROPEAN UNION 
Having regard to the Treaty establishing the European Community, 
Having regard to Council Directive 87/54/EEC of 16 December 1986 on the legal 
protection of topographies of semiconductor products, and in particular Article 3(7) 
thereof, 
Having regard to the proposal from the Commission, 
Whereas the Agreement establishing the World Trade Organization (hereinafter, WTO) 
was signed on behalf of the Community; whereas the Agreement on Trade-Related 
Aspects of Intellectual Property Rights (hereinafter, the TRIPs Agreement), annexed to 
the Agreement establishing the WTO, contains detailed provisions on the protection of 
intellectual property rights whose purpose is the establishment of international disciplines 
in this area in order to promote international trade and prevent trade distortions and 
friction due to the lack of adequate and effective intellectual property protection; 
Whereas in order to ensure that all relevant Community legislation is in full compliance 
with the TRIPs Agreement; the Community must take certain measures in relation to 
current Community acts on the protection of intellectual property rights; whereas these 
measures entail in some respects the amendment or modification of Community acts; 
whereas these measures also entail complementing current community acts; 
Whereas Council Directive 87/54/EEC of 16 December 1986 concerns the legal 
protection of topographies of semiconductor products1; whereas Articles 35 to 38 of the 
TRIPs Agreement set out the obligations of WTO Members in relation to the protection 
of layout-designs (topographies) of integrated circuits; whereas iri accordance with 
Article 1, paragraph 3, and Article 3 of the TRIPs Agreement, the Community must 
ensure that nationals of all other WTO Members benefit from such protection and from 
the application of national treatment; whereas it is therefore necessary to extend the 
protection under Directive 87/54/EEC to nationals of WTO Members, without any 
reciprocity requirement; whereas it is adequate to use the procedure of Article 3, 
paragraph 7, of the Directive to this end; 
g:Vaithni\public\ip\94<)726d 
1 OJN°L24, 27.1.1987, p. 36 
? 
3<4 
HAS ADOPTED THIS DECISION 
Article 1 
Member States shall extend the legal protection for topographies of semiconductor 
products provided for under Directive 87/54/EEC as follows: 
(a) natural persons who are nationals of, or are domiciled in the territory of, a 
Member of the Agreement establishing the WTO, shall be treated as nationals of a 
Member State; 
(b) legal entities which or natural persons who have a real and effective establishment 
for the creation of topographies or the production of integrated circuits in the 
territory of a Member of the Agreement establishing the WTO shall be treated as 
legal entities or natural persons having a real and effective industrial or 
commercial establishment in the territory of a Member State. 
Article 2 
1. This Decision shall enter into force on the date determined by the decision on the 
entry into force of the acts implementing the results of the Uruguay Round. 
2. It shall be applicable as of 1 January 1996. 
3. Decisions 90/510/EEC2 and 93/17/EEC3 are. abrogated, as of the date of 
application of the present I Decision, in so far as they concern the extension of the 
protection under Directive 87/54/EEC to countries or territories Members of the 
Agreement establishing the WTO. 
Article 3 
This Decision is addressed to the Member States. 
Done in Brussels, :-19.94 
For the Council 
The President 
2 OJ L N° 285, 17.10.1990, p. 29 
3OJN°L II, 19.1.1993, p. 22 
ISSN 0254-1475 
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