ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(74)1749
Vol.1974/0278

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?COMMISSION OFTHEEUROPEAN COMMUNITIES
COM (74)1749 final .
Brussels ,30October 1974
Draft or
JOINT COMMITTEE DECISION
suspending theapplication oftheprovisions of
Article 23(l)ofProtocol No3concerning the
definition ofthe concept of"originating products "
andmethods ofadministrative cooperation
(submitted totheCouncil "bytheCommission )
COM (74)I749 final

COMMUNICATION OFTHE COMMISSION TOTHE COUNCIL
Thepresent rale contained inArticle 23oftheProtocols No3
totheAgreements EEC -EFTA eo^atsies sets cut theprinciple according
towhich the third country products used intheobtention ofan
"originating product "benefiting from preferences maynot bethesubjec
ofaremission ofcustoms duties orrepayment ofcustoms duties ofany
form ("drawback 1')from themoment when theduty applicable intheconte
oftheagreement concerned tooriginating products ofthe same kind has
been reduced tokO%ofthebasic duty .
This rule was inserted ,inits time ,intheProtocol No3with the
aim ofpreventing third country products used being able indirectly to
benefit from asubstantial reduction induty ,areduction which they
would have noright toifdirectly imported into thecountry ofdestine
tion .
She system chosen seemed ,atthe time ,logical andappropriate to
its objective .
But the feeling has arisen ,since then ,inthe minds ofnumerous
delegations oftheMember States andEFTA countries ,aswell asinthat
ofthe Commission ,that itinvolves major inconveniences that itis
necessary toeliminate attheapproach ofthe effective date forputti
thesystem into force ,1January 1975 (because forthemajority of
products thereduction atthat date will be^0%ofthebasic duty ).
*
* *
Theinconveniences spotlighted atpresent are oftwo types :one
kind affecting thebase ofthe rule ,the other one ofamore formal
and practical kind .

Concerning thebasi ccriticisms ,these bear onthe fact that
thebanning of'''drawback "isapplicable eyreference totheduty appli­
cable totheproduct used andnetbyreference tothe final pruduct .
This causes ,thefollowing anomalies :
,(a) Therun-down islonger fortheproducts said tobe"sensitive ",
these being able tobesubject to"drawback "after 1January 1975 ev
though the final product inwhich thoy areincorporated isitself
the subject ofanormal reduction .
Example :
Amanufacturer produces playing cards from non-originating paps
and exports thefinished cards toanEFTA country .Given that paper -
isa"sensitive "product intheCommunity ,themanufacturer maybene
from theremission ofduty intheCommunity until 1January 1931 and
atthesame time ,thenormal reduction intheEFTA country (free
from 1July 1977 ).
(b) Intheopposite case ,theproducts benefiting from anormal
reduction may notbythe subject ofdrawback from 1January 1975 »wh :
thefinal .product inwhich they areincorporated itself isthe sub­
•jest ofalarger run-down penod .
.1paper maker inan5LTTA .country maynot ask forremission ofd
from 1January 1975 forthechemical products used forpaper making
atthetime cfexport ofpaper totheCommunity while atthat moment
theCustoms daty intheCommunity hasonly been reduced to85%of
the basic duty .
(c) Theright tobenefit from remission ofduty continues toexist
without limit forall theproducts used which arenotcovered bythe

Free Trade Agreements ,notably agricultural products ,given that
there donot exist originating products ofthesame kind forwhich
thecustoms duty will have been reduced to *f0%ofthebasic duty .
Concerning theincovenxences ofthepractical kind ,these stem
directly from thebasic observations made above .Itisnot ,ineffect ,
doubted that therunning down ofthe tariffs ontheproducts used and
the differences oftreatment between them will result inextra adminis­
tration and investigation work both for thecustoms administrations
and traders .
* *
Taking into account theimplications oftheproblems described
above ,theCommission fe«ls that itisnecessary tocontinue the
consideration ofthepossibilities ofintroducing anewprovision on
this question ,especially intheCustoms Committees .
This necessity leads theCommission ,inaccordance with the
wishes expressed bytheEFTA countries intheCustoms Committees and
with theunanimous feeling oftheCommunity 'sCustoms experts ,topropo
thesuspension foroneyear oftheprevisions ofArticle 23ofProto­
col No3.

-b-
Itistherefore proposed that -theCouncil adopts theannexed
draft asthecommon position ofthe .Community foruse inthgdifferent
Joint Committees EEC -EETA countries .This draft ,prepared forAustria ,
serves asamodel for the others and will beidentical for all the
other agreements .
Additionally ,itshould benoted that this decision should enter
into force on1January 1975 atthe latest and that therefore itis
absolutely necessary that theCommunity canpresent itsofficial view­
point totheEFTA countries very soon,v;hich takes into account the
administrative delays involved inputting the text into force .
\

EEC-AUSTRIA AGREEMENT
-The Joint Committee -
Draft of
JOINT COMMITTEE DECISION
suspending theapplication oftheprovisions of
Article 23(l)ofProtocol No3concerning the
definition oftheconcept of"originating products "
andmethods ofadministrative cooperation
THEJOINT COMMITTEE ,
Having regard totheAgreement "between theEuropean Economic Community
andtheRepublic ofAustria ,signed inErussels on22July 1972 |
Having regard toProtocol No3onthedefinition oftheconcept of
"originating products "andmethods ofadministrative cooperation (hereafter
referred toas"Protocol No3")»andinparticular Article 28thereof |
Whereas thepresent text ofArticle 23(l)ofProtocol No3provides that
with effect from thedate onwhich theduty applicable tooriginating
products oftherelevant kind hasbeen reduced inthe Community and in
Austria toQCffoofthebasic duty ,nodrawback orremission ofanykind my
begranted from customs duties inrespect ofthenon-originating products
used inthemanufacture ofthose originating products ;
Whereas ,byreason principally ofdifferences inthetariff regimes applied
tothevarious products used inmanufacture ,theapplication ofthese pro­
visions ,which formost products would beon1January 1975 >would result
inconsiderable difficulties aswell asadding tothetasks ofthe Customs
admini strati ons 5
Whereas itisconsequently desirable tosuspend foroneyear theapplication
ofthese provisions ;

HAS DECIDEE :
Article 1
Theapplication ofArticle 23(l)ofProtocol No3issuspended
until 31December 1975 «
Article 2
This Decision shall ento?into f'o^oe on1January 1975 *
/
Done atBrussels ,
For the Joint Committee ,
The Chairman ,
The Secretaries