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COMMISSION OPTHEEUROPEAN COMMUNITIES
COM(73)830final
Brussels.30May1973
RECOMMENDATION FORACOUNCILDECISION
onthenegotiation ofanagreement
concerningtwodraftannexestotheinternational
Conventionforthesimplification andharmonisation of
customsproceduresandinrespectof
temporaryadmissionforinwardprocessingand
warehousingforinwardprocessing
(submittedtotheCouncil "bytheCommission)
COMC73)830final

Recommendation
for aCouncil Decision
relating tothenegotiation ofanagreement
concerning two draft annexes tothe •
international Convention for the simplification
andharmonisation ofcustoms procedures and
inrespect oftemporary admission forprocessing
(inward processing )andwarehousing forinward
processmg
EXPLANATORY STATEMENT
1.Introduction
'1.1 TheCustoms Cooperation Council (C.C.C.)hasprepared adraft
international Convention for thesimplification andharmonisation
ofcustoms procedures ,which will besubmitted foradoption at
itsmeeting of16to22'May 1973 .
With regard totheCommunity ,this Convention has been made
thesubject ofaRecommendation foraCouncil Decision (doc .
COM (73)k60final of28March 1973 ,E/9?7/73r"^COKER 1^6)of12'
'April 1973 ).
The Convention opens thepossibility ,from the time ofits
signature ,ofspecifying the annex orthe annexes ,which the
contracting parties mayundertake toapply (Article 11paragraph
4oftheConvention ).
.Further ,for the purposes ofvoting when required atthe C.C.C. ,
each annex istaken asconstituting aseparate convention
(Article 6oftheConvention ).

-2-
1.2 •The Permanent Technical Committee ofthe C.C.C. has decided
towrite into itsprogramme offuture work the draft annex
concerning :
-temporary admission forinward processing (doc .19.503 of
6April 1973 »shown atAnnex I),
-warehousing forinward processing (doc.19.50 1*of10April 1973 ,
shown atAnnex II).
The Secretariat ofthe C.C.e.has invited Member States aswell
asnon-Members andinternational organisations concerned ,to
submit anyobservations andsuggestions which they mayhave
onthe draft annex
•before 15June 1973 onmatters affecting temporary admission
forinward processing ,
-before 29June 1973 °nmatters affecting warehousing forinward
processing .
1.3.The Commission has examined these drafts with representatives
ofMember States atameeting ofthe adhocGroup ofthe
Committee onInward Processing with aview topreparing a
common stand tobe'tiaksn ,tobeconveyed totheSecretariat of
theCustoms Cooperation Council within th,etime limit laid down .
\
2.The main features ofthe drafts
■2.1 .Temporary admission forinward processing
Thework onthis draft bytheSecretariat oftheC.C.G. ^as
taken into account ,inter alia ,theCouncil Directive ofkMarch
1S69 »concerning theharmonisation ofprovisions laid down by
law ,regulation oradministrative action (EEC69/73)inrespect
oftheprocedure forinward processing .

-3-
The draft isbased onthe following points :
-thelegislation ofmost oftheStates contains provisions
allowing conditional relief from import duties and taxes to
begranted forgoods which are intended tobere-exported after
having undergone specified manufacturing ,processing orrepair ,
-the principal aim ofthis Customs procedure istamake it
possible fornatienal undertakings tooffer their products or
their services onforeign markets atcompetitive prices and
thereby help toprovide more employment opportunities for
national labour ,
-this procedure may besubject tothe condition that the
proposed operations shall bebeneficial tothe national economy
andshall notconflict with".' ,theinterests ofnational producers
ofidentical orsimilar goods ,
-asageneral ruXe ,the procedure involves total conditional
relief from import "duties and taxes .
2«2.Warehousing for inward processing
This draft isdevoted tothe subject oftemporary admission for
inward processing :itispart ofthe field ofapplication of
Directive (ESC ) 69/73.
•The draft isbased onthe following points :
-thelegislation ofcertain countries contains provisions for
persons tobeauthorised toimport goods under terms ofcondi­
tional relief from import duties and taxes ,the conditions
being that :
.operations onsuch goods shall becarried out inpremises
designated bytheCustoms authorities andputunder their control ,
and
.theresulting products shall bere-exported intheir entirety
orinpart ,
-theprovisions relating totemporary admission forinward
processing areingeneral applicable totheprocedure for
warehousing forinward processing .

-k-
This latter procedure differs from the former bythespecial |
facilities which theauthorities accord onaccount oft^iemore !
■ ' ' 1; l
favourable conditions under which customs control may beexercise !
3•Scope forCommunity action inthe negotiation ofthe drafts .
Themain characteristics ofthese drafts (point 2above )give them
perforce .abearing onthose Customs procedures which rank among the 1
principal instruments ofcommercial policy .Consequently ,when these
procedures are the subject ofinternational agreements ,they become
both tariff and commercial agreements which are part ofthe common
commercial policy ,byvirtue ofArticle 113oftheEECTreaty .
Thenature ofArticles 113and 11^oftheEECTreaty issuch that
only theCommunity has thecompetence tonegotiate andconclude these
agreements .
Article 113paragraph 3oftheEECTreaty stipulates that ifagreements
onwhich ithas abearing need tobenegotiated with third countries ,
the Commission shall submit its recommendations tothe Council which
shall authorise theopening ofthenecessary negotiations .
k»Conclusion .
TheCommission recommends that theCouncil ,byvirtue ofArticle 113
,oftheEECTreaty ,should ,having regard toDirective EEC N°69/73«
authorise ittonegotiate thedraft annexes attheinternational
Convention for thesimplification andharmonisation ofCustoms proce­
dures and inrespect of :
-temporary admission forinward processing ,
-warehousing forinward processing
\

Recommendation
for a
Council Decision
onthenegotiation ofanagreement
concerning two draft annexes totheinternational
Convention for thesimplification andharmonisation of
customs procedures
andinrespect oftemporary admission forinward
processing andwarehousing forinward processing
TheCouncil oftheEuropean Communities ,
HAVING REGARD totheTreaty establishing theEuropean Economic Community ,
and inparticular Article 113 thereof ;
HAVING REGARD totheRecommendation oftheCommission ;
WHEREAS the conclusion ofanagreement concerning two draft annexes to
theInternational Convention forthesimplification andharmonisation
ofcustoms procedures and inrespect oftemporary admission forinward
processing andwarehousing forinward processing can
efficiently contribute tothedevelopment ofinternational trade ,and
inparticular international commerce ;
WHEREAS the aforesaid agreement has abearing onthecommon customs
legislation ,inparticular inthematter oftheCommon Customs Tariff ;
whereas itisnecessary tohave regard totheproper requirements ofa
Customs Union ;whereas itisagreed that theCommunity negotiate and
conclude this agreement ;
HAS DECIDED :
Article 1
TheCommission isauthorised toconduct negotiations with the
Customs Co-operation Council inorder toconclude anagreement Concerning
twodraft annexes totheinternational Convention forthesimplification
andharmonisation ofcustoms procedures ,andinrespect oftemporary
admission forinward processing andwarehousing forinward processing ,

The Commission shall conduct these negotiations inconsultation
with theSpecial Committee ,asprovided forinArticle 113 ofthe
Treaty ,which shall assist theCommission inthat task .
Done atBrussels For the Council
The President ,

Annex I«
i
E.6-DRAFT ANNEX CONCERNING TEMPORARY ADMISSION
FOR PROCESSING (INWARD PROCESSING )
! · ,»·''
INTRODUCTION
S''
The national legislations ofmost countries contain provisions
.> i.
allowing conditional relief from import duties -and taxes tobe
granted inrespect ofgoods that are tobere-exported after having
undergone specified manufacturing ,processing orrepair .The
Customs procedure which reflects these provisions isthat of
Temporary admission forprocessing (inward processing ),hereinafter
called "inward processing ".
'1 '■>
The' main purpose ofthis Customs procedure isto -make it
possible for national enterprises tooffer their products or
» ,
services onforeign markets atcompetitive prices and thereby to
help toprovide more employment opportunities fornational labour .
4
' * 'i :
However ^-admission forinward processing may bemade subject
tothe condition that the proposed ;operations shall bebeneficial
tothenational 'economy and shall ,notconflict with theinterests
ofnational producers ofgoods identical orsimilar tothose in
4»
respect ofwhich admission isrequested .
!»
Asageneral rule ,admission ,for inward processing involves
total conditional relief from import duties and taxes .However ,
import duties andtaxes maybecharged onwaste deriving from 7the
processing ormanufacturing ofthe goods . >
National legislations usually require that the goods exported
shal^ha^e been obtained from the .imported goods (setting-off with !
the same goo'ds ),.
1.

Annex I>
Insome cases ,however ,authority may begiven for the use
ofgoods equivalent tothose admitted for inward processing '
> »
(setting-off with equivalent goods ). -
*
Within the context ofinward processing ,exemption from
import duties and taxes may begranted inrespect ofgoods used -
nn •J! ;1
upduring the production' ofthe exported goods without actually ;
being contained inthem *
Aspecial Customs procedure may beapplied inrespect of
foreign goods which are tobere-exported ,inwhole orinpart ,
after having undergone specified manufacture ,processing or
 *
repair and are 1utilized inpremises' approved bytheCustoms and
placed under their supervision .This special Customs procedure ,
which isclosely delated tothetemporary admission (inward
processing )procedure ,'forms the subject oftheAnnex concerning
warehousing for "inward processing .1'
*
DEFINITIONS ■ . . •"
Forthepurposes ofthisAnnex : j
(a)The term "inward processing "means theCustoms procedure under
which certain goods can bebrought into aCustoms territory
conditionally relieved from payment ofimport duties and
taxes ;such goods must beimported for aspecific purpose
andmust beintended forre-exportation within aspecific
period after having undergone specified manufacturing ,
processing ,orrepair ;
»
,7
(b)The term "import duties and taxes "means the Customs duties
and allother duties ,taxes ,fees orother charges which are
collected onorinconnexion with the importation ofgoods ,but
not including fees and charges which are limited inamount
tothe approximate cost ofservices rendered ;/

Annex I
(c)The term "compensating products "means the products obtained
asaresult ofthemanufacturing ,processing orrepair 'ofthe
goods admitted with conditional relief from import "duties and
taxes ;
(d)The term "Customs control "means themeasures applied to
ensure compliance with the laws and regulations which the
Customs are responsible for enforcing ;
(e)The term "security "means that which ensures tothe satisfac­
tion ofthe .Customs ,that anobligation tothe Customs will be
fulfilled .Security isdescribed as"general "when itensures
that the obligations arising from several operations will be
fulfilled ; * '/
(f)Theterm "person "means both natural andlegal persons iunless
thecontext 'otherwise requires .
' ' 1* •
PRINCIPLE ''
:r !y
Standard
Inward processing shall begoverned bytheprovisions of '
this Annex . ;
FIELD OFAPPLICATION • .-
2» • Standard
National legislation shall enumerate the cases inwhich
f - • • '
admission forinward processing maybegranted andshall laydown
the requirements which must bemet .
3.

Annex I
Notes . : . ..
<
1. :The cases eligible for inward processing may beenumerated
inthe form ofexhaustive lists and/oringeneral terms .
2. The right toimport goods for inward processing may bemade
subject tothen condition that theproposed processing operations
are regarded bythe competent authorities asbeneficial tothe
national economy .
3. The right toimport goods for inward processing may be t
reserved topersons established intheCustoms territory ."/
3. Standard
/ *
Goods admitted for inward processing shall beafforded
total conditional relief from import duties and taxes .However ,
waste deriving frcJm the processing ormanufacturing ofgoods
admitted for inward processing that isnot re-exported ortreated
insuch away astorender itcommercially valueless may be
sassessed toambort duties and taxes' -.
*
r■''
Notes
~ .i
1. National ;legislation mayprovide that waste having commercial
value shall beassessed either onthe basis ofits own tariff
description oronthe basis ofthe tariff description ofthe goods
•from which itisderived . . .
■2. National legislation ,may provide that ,import duties and
taxes shall not becharged onwaste within certain percentage •
limits oronwaste that isirrecoverable orunusable .

Annex !
4. ' ' . ' Standard
Admission forinward processing shall notbelimited to .goods
« « •
imported directly from abroad but shall also begranted forgoods
exCustoms transit ,exCustoms warehouse orfrom afree port ora
free zone . <•
5. - • Recommended Practice '
Admission for inward processing should begranted without
regard tothe country oforigin ofthe goods ,the country ,whence
they arrived or .their country ofdestination .
.' i: ■■■
6. • ' "'■ Recommended Practice
Wh6n the goods are tobeused inthe performance ofacontract
tomake upwork from materials supplied ,entered into with aperson
established abroad ,admission forinward processing should notbe
made conditional upon non-availability inthe Customs territory of
* * -<goods equal inquality andvalue ,,totheimported goods .
t» *
7. ' „ Standard
L?' .n
Where the right 'toimport goods for inward processing is
K.. .
reserved topersons established inthe Customs territory ,itshall
not berequired that such persons shall bethe owners ofthe
imported goods .
8. - < Recommended Practice -
The identifiability ofthe imported goods inthe compensating
products should not beimposed asanessential condition of
admission for inward processing .
/ «
9. •* Recommended Practice
••» - ■
Products such ascatalysts ,1accelerators orretarders of
chemical reactions which ,being used toobtain compensating
products ,disappear entirely orpartially during such usewithout

Annex T
actually being contained inthose products ,should beexempted
from import duties and taxes tothe extent that the resultant -
compensating products are exported .This exemption from import.'
duties andtaxes shall not ,however ,extend tothe use ofsources
ofenergy ,lubricants ,equipment ortools .
ηλ ..Γη
ADMISSION OFGOODS FOR INWARD PROCESSING
(a)Formalities prior toadmission for inward processing
10. . Standard
National legislation shall specify the cases inwhich prior
authority isrequired for admission ,for "inward processing and the
authorities ,empowered togrant such authority .
11. * Recommended Practice
Persons who carry onlarge-scale and .continuous inward
■*processing operations should begranted ageneral authorization
ηη 'covering such operations . ■:
12. ' . •/ Standard
Where goods admitted for inward processing are toundergo
manufacturing orprocessing ,theCustoms authorities shall fix
the rate ofyieLd ofthe operation byreference tothe actual !
isconditions under 1which itiseffected .Thedescription ,quality
V- !
and quantity ofthe various compensating products shall be
specified upon fixing that rate . ,
13. ! . ri , Recommended Practice
,Wher£ theinward processing operations :
t■: •
-relate to.goods whose characteristics remain reasonably constant
-arecustomarily carried outunder ..clearly defined technical ;;
conditions ,and .
i'
-give compensating products ofconstant quality ,

Annex I
theCustoms authorities shauld lay down Standard rates ofyield
applicable totheoperations . ' . (
(b)Declaration for_i.nward_2rocessi.n2 - '/
14. Standard
• "«.r'
National legislation shall specify the conditions under
_„ .ηπ
which goods forinward processing shall beproduced atthe competent
Customs office and 'aGoods declaration shall belodged .
15. Standard
m*
The national -forms -used onadmission for inward processing .
shall beharmonized with those used for the Goods declaration for
home use . • .
*
(c)Securit ^ ^ ■
16. ' Standard
The forms ;,inwhich security istobeprovided onadmission
for inward processing shall belaid ,down innational legislation
ordetermined bytheCustoms ^authorities inaccordance with
national legislation . ..
17. • . Recommended Practice
The choice between the various acceptable forms ofsecurity
should beleft tothe declarant .
18. Standard
The Customs authorities shall ,inaccordance with national
legislation ,determine theamount inwhich security istobe ■
provided when goods areadmitted forinward processing .
» -
/*•»19. •' * " Recommended Practice
The amount ofthe security tobeprovided when goods are
admitted for inward processing should not exceed the amount ofthe
import duties andtaxes from which thegoods areconditionally
relieved . _
/.
«

Annex I /
ι
Note '
This Recommended Practice does not .prevent the amount of •
the security from being determined onthe basis ofasingle rate
where the goods fall inawide range oftariff headings .
^0. nn Standard
Persons who regularly use the inward processing procedure
atone ormore Customs offices in'agiven Customs territory shall
beauthorized toprovide gpneral security .
i*
21. Recommended Practice
Customs authorities should waive the requirement for
* ♦
security where they .are satisfied that payment ofany sums that .
Γ)Ί · ί ;
might fall due can beensured byother means .
(d)Examination ofthe cjoods ■
22. i,, ; fi Recommended Practice
Atthe request ofthe .importer ,and for reasons deemed tobe
valid ,th<*Customs authorities 'should ,sofar aspossible ,allow
goods that are ,tobeadmitted for inward processing tobeexamined
^ ■ ,
'»onprivate premises ,the expenses entailed bysuch examination
ι ·
being borne by ,the .importer' .-^ •
(e)Identi ficationjneasures
23. ... ' ' ;m Standard
' •' . •'
Therequirements relating totheidentification ofgoods
admitted for inward processing shall belaid down bythe Customs
authorities ,due account being taken ofthe nature ofthe goods ,
themagnitude ofthe interes.ts irlvolved and the need toavoid
deteriorating the goods .

Annex I
Note
For the identification ofgoods admitted for inward -•.
processing ,theCustoms authorities may rely onforeign .seals -
affixed tothegoods ,onmarks ,numbers orother indications "
permanently affixed tothem ,onthedescription ofthegoods or
scale plans orphotographs ,orhave recourse tosampling ,.tothe'
«« , ■n
affixing ofCustoms marks (seals ,.stamps ,perforations ,etc.).
The Customs authorities may also have recourse tothe importers'
stock accounts . -
STAY OPTHE GOODS INTHE CUSTOMS TERRITORY
24. 1 Standard
/ *
The time limit for .inward processing shall befixed ,in .each
case ,byreference tothe time necessary tocomplete the processing
operations ,uptothemaximum period ,ifany ,laid down innational
'i*•
legislation .. ,
25. u . ^  Recommonded Practice
EL * t'
Atthe request ofthe person concerned ,and for reasons
deemed tobevalid ,the Customs authorities should extend the
period initially fixedT
26. ' Standard
The persons concerned shall keep records orstock accounts
from which the use ofthe goods admitted for inward processing
can bechecked .
* *
27. Standard
Persons -accorded inward processing facilities shall allow
theCustoms authorities t<5check ontheir premises ,atany time ,
thegoods admitted forinward processing andalso the
compensating products and theproducts incourse .ofprocessing .

Annex I
28. Recommended Practice
The Customs authorities should allow part ofthe proces'sing
operations provided fortobecarried outbyaperson' other' than
.i
the person accorded inward processing facilities ,without the
latter having totransfer ownership ofthe goods admitted for
inward processing butwith thecondition that heshall remain
liable totheCustoms fortheentire *duration of 'theoperations .
TERMINATION OFINWARD PROCESSING ' -
29. -, • Standard
National legislation shall specify the conditions under
which the compensating products shall beproduced atthe
;ι; .
competent Customs office and aGoods declaration shall belodged .
« •
' '« ',1
Note ^ ■■
National legislation may prescribe that the Goods declara -
^ .. .. - A*■tion shall contain the particulars needed topermit discharge of
II' *
the inward processing .declaration with respect tothe goods that
*
have been utilized .
1 '
(a)Re-exgortation " ■
30. ■t ■ + Standard
. i ' V:;
Provision shall bemade topermit compensating goods tobe
exported through aCustoms office other than that through which
thegoods admitted for inward processing were imported .
* i
31. • Standard
' '• î.iU
/Provision shall bemade topermit inward processing tobe
terminated by ,"exportation of^the compensating products inone or
more consignments (setting-off with identical goods ).
10.
I

Annex I
T?r>rornmended Practice
32.
Provision should bemade fortermination o£inward processing
byexportation oftheproducts fromthetreatment ofgoods
identical indescription ,quality andtechnical characteristics
tothose admitted forinward processing (setting-off withequivalent
i\ ' •' -' .nnQOOOS )• •.ππ
Recommended Practice
Attherequest of .theexporter ,andforreasons deemed tobe
valid ,theCustoms authorities should ,sofaraspossible ,allow .
compensating products forre-exportation tobeexamined onprivate
premises ,theexpenses entailed bysuchexamination being borne
bytheexporter .
^. ■.. " Recommended Practicej4 * -
Where ,forreasons deemed tobevalid ,thegoods admitted
forinward processing cannot undergo theintended manufacturing ,
processing or"repair ,theCustoms authorities should authorize
their re-exportation inthe,state asimported ,with termination
ofinward processing .-• ,
" Standard
•3«)•
Provision shall bemad-e forterminating inward processing
byplacing thecompensating products inafree port orfree zone .
.ι
(b)Other method s_of_disgo sal
., . • Standard36* "
Provision shall bemade for .terminating inward processing
bydeposit ofthecompensating products inaCustoms warehouse .
with aview "tosubsequent exportation orother authorized disposal ..
11.

Annex I
v
37. Recommended Practico
Provision should bemade for terminating inward processing
byplacing thegoods under aCustoms transit procedure with ayiew
totheir subsequent exportation . , '
38. r Recommended Practice
ηΠ Ν.Γ. ·
Provision should bemade for terminating inward processing
bydeclaring the compensating products for home use ,subject to
compliance with the conditions and formalities applicable insuch
case . .
39* Recommended Practice
Where ,for reasons deemed tobevalid ,the goods admitted
for inward processing cannot undergo the intended manufacturing ,
c„ -processing orrepair ,the Customs authorities should authorize
9L>their declaration for home use ,subject tocompliance with the
conditions and formalities applicable insuch case .
n 11 •
..r' \ ' Standard
[- ' •r
National legislation shall specify the point intime tobe
.: Αtaken into consideration for the purpose ofdetermining the value
and quantity ofgoods allowed tobedeclared for home use and
also the rates o.fthe import duties and taxes applicable toi;hem .
Note 5- . k-
■■ i
::'î c
1. National legislation may ,in -particular ,provide that the
> »,
amount ofthe import duties and taxes applicable tothe compensating
i.'
products shall not exceed the amount ofthe import duties and
taxes applicable tothe goods admitted for inward processing and ■
/ * ■
utilized . ,
12.

AnnexI
2.Nationallegislation mayprovidethatintheeventof
declaration forhomeuseofcompensating productswhich,during
processing ,havebeentemporarilysent-abroadfor-suppleiriehtary
processing ,theimportdutiesandtaxesshallbe,chargeableonly
onthebasisofthevalueofthegoodsinitiallyused,increased
bythecostoftheprocessingoperationscarriedoutabroad.
41. Recommendod Practice
Provisionshouldbe-madeforterminating inwardprocessing
bytransferofownershipofthecompensating productstoaperson'
whointendstore-exportthemafterhavingsubjectedthemtoa
processingoperation ,providedthatthe'latterpersonassumesthe
obligations ofthe"importerandthatanewinwardprocessing ...
authorization canbegranted.
42. ' ,-i..Recommonded Practice
» ...^Provision -shouldbemad'eforterminating inwardprocessing
inrespectofgoodslostasaconsequence ^ofnaturalcauses,such
asleakageordryingout,providedthatsuchlossisduly
established tothesatisfaction oftheCustomsauthorities .
Note , .'
National'legislation maylaydownStandardlosspercentages
forspecifiedcategoriesofgoodsadmittedforinwardprocessing .
43. • Standard
Provisionshallberrtadeforinwardprocessingtobe
terminated where,atthe.requestOfthepersonconcerned ,the
good^ar^abandonedto^theRevenueordestroyedorrendered
commercially' valuelessunderCustomscontrol,'astheCustoms
authorities maydecide.Suchabandonment ordestruction shall
notentailanycosttotheRevenue.--,
13.

Annex I •
44. Standard
•» '
Goods admitted for inward processing ,and compensating ;
products ,which are destroyed orirrecoverably lost byaccident
orforce majeure shall not besubjected toimport duties and
taxes ,provided that such destruction orloss isduly established
tothe satisfaction ofthe .Customs kifthorities .
Any waste orscrap remaining after destruction shall be
liable ,iftaken into home use ,tothe import duties and taxes
that would beapplicable tosuch waste ,orscrap imported inthat
state .
DISCHARGE ORSECURITY ;
45. ,,* - Standard
yAny security furnished shall bedischarged assoon as
possible after inward processing has'been terminated .
46. •. Recomm<*nded Practice
Ifsecurity has been .given inthe form ofacash deposit , .
provision should bemade for ittoberepaid attheoffice of
re-exportation ,even ifthe goods for inward processing were not .
imported through ,that office .*
INFORMATION CONCERNING TEMPORARY ADMISSION
47. Standard
ι-»κ
The Customs authorities shall ensure that all relevant
information regarding theinward processing procedure isreadily
available toany person interested .
14.

Annex II .
E.7-DRAFT ANNEX CONCERNING WAREHOUSING
FOR INWARD PROCESSING
I < '
INTRODUCTION
The national legislations ofanumber ofcountries contain
provisions under which persons may beauthorized toimport goods
with conditional relief from import duties and taxes ,provided
that thegoods are used inestablishments approved bytheCustoms ,
, ι
andplaced under their supervision and that theproducts obtained ;
are tobere-exported -inwhole orinpart . ■
The Customs procedure which reflects these provisions is
thewarehousing for inward processing procedure .
The provisions oftheAnnex concerning temporary admission .
forprocessing' (inward processing )apply ,ingeneral ,tothe
warehousing .for inward processin-g procedure .This latter
. ,, '1 'procedure differs ,however ,frorp the former inthat special
facilities are generally accorded bytheCustoms authorities
becausfe Customs control ismore easily ensured .
Admission to -the ,warehousing for inward processing /
procedure may ,however ,bemade subject tothe condition /that
theestablishment inwhich the processing operations are tobe
carried out shall besituated inaparticular locality orarea .
The volume ofthe imported goods tobeused may also betaken
into consideration . " ,v: .
DEFINITIONS '
«
ι
For the purposes ofthis ;Annex :
0
(a)theterm "warehousing forinward processing procedure "means
theCustoms procedure under /which certain gpods can bebrought
into aCustoms territory conditionally relieved from payment
!..

Annex II ..
ofimport duties and taxes ;■such goods must beimported for
«
aspecific purpose and must beintended for re-exportation
within aspecific period after having undergone specified ,,
manufacturing ,processing orrepair inestablishments •
approved bytheCustoms andplaced under their control (inward .r
processing "warehouses ); *!1" _ '/
(b)the term "import duties and taxes "means theCustoms duties
and all other duties ,taxes ,fees orother charges which are
collected onorinconnection wi.th "the importation ofgoods ,
but not including fees and charges which are limited inamount
tothe approximate cost ofservices rendered ;-
(c)theterm "compensating products "means theproducts obtained
asaresult ofthemanufacturing ,processing orrepair ofthe
goods admitted with conditional relief from import duties and
taxes ; , , ' .
(d)the term "Customs control "means the -measures applied toensure
compliance with the laws -and regulations which theCustoms are
responsible for enforcing ;
(e)the term "security "m^ans that which ensures tothe satisfaction
ofthe Customs that anobiigation totheCustoms will beful­
filled .Security isdescribed as "general "when itensures
that theobligations arising from several operations will be
fulfilled ; -*r
»I'
(f)theterm "person "means both natural and legal persons ,unless
-the context otherwise requires .
/ «
2.

Annex' II ..
PRINCIPLE , ... •
1. Standard
The warehousing for -inward processing procedure shall be
governed bytheprovisions ofthis .Annex . v
*n ■>r.-y., -■■,■■■
2. . Standard
The provisions oftheAnnex concerning temporary admission
forprocessing (inward processing )shall apply togoods under
thewarehousing -for inward processing procedure provided that
theContracting Party accepting the present Annex has under­
taken toapply theAnnex concerning temporary admission for
processing (inward processing ). . '
ESTABLISHMENT OFINWARD PROCESSING WAREHOUSES •• . "
3. , ■•, • ■. ■•standard
•] ! |
National legislation shall provide for inward processing
 
warehouses ,for the sole use ofpersons who regularly place goods
é ••
under aninward processing procedure .
4. " 'Standard
The requirements witlt respect tothegeographical location
ofinward processing warehouses ,and their equipment shall be
laid down bytheCustoms authoriti-es .
Noter ,
•1 . ri rs
1. TheCustoms authorities maydesignate thelocalities or
areas inwhich theestablishment ofwarehouses may bo .approved .
/ « ...... ;
2. The persons concerned may berequired tofurnish proof
that ,the technical equipment of7theestablishment isadequate -
for thecontemplated processing operations .
3.

Annex II
INSTRUMENTS OFAPPROVAL
5. . ■ Standard
The Customs authorities shall specify inthe instrument of
approval ofaninward processing warehouse :
Ca)the goods that may beused there ;
(b)the nature ofthe authorized processing operations ;
(c)the duration ofvalidity ofthe authorization ;
(d)theperson (s)responsible for thepayment ofany import duties
and taxes chargeable ongoods under this procedure .
6. ' Recommended Practa .ce
Μ ΙΜ·.··-·· ΊΙ····!!·!·· IIIIΗ II
The instrument ofapproval ofaninward processing warehouse
should not place any limit onthe quantities ofgoods that may be
imported under this procedure .
t
7. . '' Recommenclod Practice .
111 " 11 "
The Customs authorities should extend the initial period of
validity ofthe instrument ofapproval ofaninward processing
warehouse atthe request ^ofthe person concerned ,provided that
the conditions ofapproval continue tobefulfilled .
8. -Standard
The Customs authorities ,shall lay down the arrangements for
theCustoms control ininward processing warehouses .
_*
Note
/For*thepurposes ofcontrol ^theCustoms authorities may ,
inparticular :
-keep thepremises under permanent orintermittent supervision ;

Annex IX .
-keep (orrequire tobekept bytheperson concerned )accounts
ofgoods admitted under theprocedure ,using either special
registers orthe declarations ; f
.i
-take stock from time totime ofthe goods admitted under the
procedure ,whether inthe state asimported ,undergoing ^r.
processing "orinthe form ofcompensating products .
ADMISSION OFGOODS TOINWARD PROCESSING WAREHOUSE
(a)Dec1aration_forwarehousing forinward processing
M
9. Standard
Provision shall bemade for declarations inrespect of
goods that are tobeadmitted under the warehousing for inward
■processing procedure tobecentralized atthe Customs office
within whose jurisdiction the inward processing warehouse is
located . ,
:
1.M
(b)Securit ^ . „
*
10. •* „^ .... Standard
TheCustoms authorities shall waive security where the
goods -are placed inaninward processing warehouse which is
under adequate Customs supervision .
11. • Standard
Where security isrequired onadmission ofgoods under the
warehousing for inward processing procedure ,theCustoms
authorities shall allow thepersons concerned toprovide ageneral
security . '"

Annex II
ι
(c)Examination '•
12. 'Standard
Goods tobeadmitted under the warehousing for inward
processing procedure shall beexamined on ;thepremises ofthe sr
person concerned . •■•
» •
Note
Payment bythe person concerned oftheexpenses entailed by
such examination may bewaived .
(d)Identification measures '.-.
13. ■Recommended Practice
For the identification ofgoods placed inaninward '*
processing wairehduse ,the Customs authorities should becontent
with theparticulars contained in'the stock accounts oftheperson
concerned . .r'
STAY OPTHE GOODS ININWARD PROCESSING WAREHOUSE
K 'V" '
14. Standard
The Customs authorities' may require that the stock ;accounts
ofthe person concerned shall atall times show the following ..
particulars for each category ofgoods placed inaninward
processing warehouse :quantities not yet used ,quantities in
course ofprocessing and quantities which have been incorporated
incompensating products . . ; ^ , <•,
6.

Annex II
REMOVAL FROM INWARD PROCESSING WAREHOUSE
nmmMaamMMMaMMaaaiMaMMMm
(a)Declaration upon removal from_inward ££2£essin2_warehouse
15» Standard
Provision shall bemade for Goods declarations for removal
from inward processing warehouse tobecentralised atthe
Customs office within whose jurisdiction the inward processing
warehouse islocated .
(b)Examination'
t
16. ^i, Standard
««* ,r>r»"
/
The compensating products declared for removal from
inward proc§§s"ing warehouse shail beexamined onthepremises
oftheperson doncerned .
t
/
Note , .n "C
 
Payment bythe person concerned ofthe expenses entailed
*
bysuch examihation may bewaived ,
(c)Clearance for hom£ "use
17. ' Standard
Provision shall bemade for terminating thewarehousing
for inward processing procedure bytheclearance for home use
ofaspecified percentage ofcompensating products .
Note
/ .;• '''11 •This percentage may belaid down inthe instrument of
* .
approval ofthe inward processing warehouse .
n••• -r,i
7.

Annex II ;
INFORMATION CONCERNING THE WAREHOUSING FOR INWARD PROCESSING .
PROCEDURE
' 1 ' ►
. * i•
18. ' 1 Standard
The Customs authorities shall ensure that all relevant
' ' r,« .Mn
information regarding the -warehousmgL for inward .processing
procedure isreadily available toany person interested .