No C 344/10 Official Journal of the European Communities 31. 12. 85 
Opinion on the proposal from the Commission to the Council fixing the Community's Generalized 
Tariff Preferences Scheme for 1986 (x) 
(85/C 344/07) 
In a letter dated 16 September 1985 the Council of the European Communities requested the 
Economic and Social Committee to draw up an opinion on the abovementioned proposal. 
The Section for External Relations, which was responsible for preparing the Committee's work on the 
subject, adopted its opinion on 12 November 1985 in the light of the report by the rapporteur, 
Mr Cavazzuti. 
At its 231st plenary session (meeting of 28 November 1985) the Economic and Social Committee 
adopted the following opinion unanimously: 
1. The Committee would refer to its recent opinion on the 
Commission proposal regarding a review of the European 
Community's Generalized Tariff Preferences Scheme (2). 
2. The Committee argues in this opinion for the 
maintenance and, if possible, increase in the value of the GSP 
as: 
— an instrument of development policy for stimulating the 
economies of developing countries in line with their own 
development models, 
— a commercial instrument for encouraging developing 
countries to participate in world trade. 
At the same time, this recent ESC opinion calls for the 
economies of developing countries to be 'gradually' exposed 
to international competition (in accordance with GATT 
rules). 
3. The Committee thinks it unfortunate that the 
Commission's GSP proposals for 1986 incorporate the 
policies set out in the abovementioned proposal for a review 
without waiting for the opinion of the Economic and Social 
Committee. 
4. The Committee is nevertheless pleased that from 1986 
the Commission intends to put into operation the principle of 
cross-selectivity advocated by members of the Economic and 
Social Committee, i.e. the withdrawal of GSP concessions for 
products from countries producing under conditions of 
competitiveness comparable with those of the Community. 
Moreover, the withdrawal of quotas of sensitive products 
hitherto granted to such countries means that the 
Community can now open up its market more to imports of 
sensitive products from poorer countries. 
5. The Committee regrets that the Commission has not 
yet fixed a more realistic economic threshold, namely per 
capita GNP, for calculating when developing countries lose 
their entitlement to GSP benefits. Using this yardstick, a 
developing country's position with regard to GSPs would 
have to be re-examined once its per capita GNP equals that of 
any one Member State of the Community. The 
(») OJ No C 302, 25. 11. 1985, p. 1. 
(2) OJ No C 303, 25. 11. 1985, p. 10. Committee also considers that the position of State-trading 
nations must be re-examined because of the difficulties of 
comparing both per capita GNP and production costs. The 
case of State-trading nations could — irrespective of their 
current commercial status (customs duties, quotas and 
others) — be regulated in a separate context. 
6. The Committee strongly re-affirms its belief that the 
following should be excluded from the GSP: 
— counterfeit products, on which it has recently taken a 
stand (3), 
— products which, on entering the Community, are subject 
to anti-dumping and /or anti-subsidy measures since they 
distort competition to an unacceptable degree, 
— manufactured goods from countries which levy excessive 
export duties on the raw materials used. 
7. The Committee still has doubts about the advisability 
of granting GSP concessions for products whose 
manufacture clearly does nothing to promote the 
development of the country on whose territory the product is 
manufactured. 
8. The Committee also disagrees with the new 'method of 
allocating' zero-rated tariff quotas among the Member 
States; such a method may result in some countries being 
allocated excessive quantities which are hard to absorb, 
thereby jeopardizing the aim of simplifying and improving 
the system. 
9. The Committee considers that the GSP must not 
promote the export of products which are needed to feed the 
local population; nor must it promote the export of products 
which can more usefully be processed locally, thereby 
acquiring a greater added value. 
(3) Opinion of the Economic and Social Committee on the proposal 
for a Council Regulation (EEC) laying down measures to 
discourage the release for free circulation of counterfeit goods 
(OJ No C 218, 29. 8. 1985). 
31. 12. 85 Official Journal of the European Communities No C 344/11 
data and is able to make more systematic use of 
data-processing in the compilation of statistics. 
14. The Committee feels that, unfortunately, the various 
changes which have been proposed in connection with 
agricultural products (increase in preferential quotas for 
Virginia tobacco and other raw tobacco, canned pineapple, 
soluble coffee and cocoa butter) are unlikely to stimulate 
diversification of production in the developing countries. 
15. The Committee would reiterate its belief that in all 
aspects of external relations the Community should seek to 
improve the social as well as economic situation in the world. 
Recognition of this fact by the Community cannot in any way 
be regarded as interference in the internal affairs of non-EEC 
countries. In this connection the Committee would draw 
attention to the importance which it has always attached in 
its opinions on international trade to respect for human 
rights — and in particular the observance of fair labour 
standards as defined by the International Labour 
Organization. The Committee would draw particular 
attention to the conventions on the right of association (84), 
trade-union freedoms and the protection of trade-union 
rights (87), and the right to organize and engage in collective 
bargaining (98). 
16. The Committee regrets that in its proposals for 1986 
the Commission has not made any reference to these social 
aspects despite having said that it would before publication 
of the guidelines for 1986 to 1990. 
The Chairman 
of the Economic and Social Committee 
Gerd MUHR 
Opinion on the proposal for a Council Directive on the freedom of establishment and the free supply of 
services in the field of mortgage credit (*) 
(85/C 344/08) 
On 11 February 1985 the Council decided, in accordance with Article 198 of the Treaty establishing 
the European Economic Community, to ask the Economic and Social Committee for an opinion on 
the abovementioned proposal. 
The Section for Industry, Commerce, Crafts and Services was instructed to prepare the work on this 
matter and issued its opinion on 6 November 1985. The rapporteur was Mr Pelletier. 
At its 231st plenary session (meeting of 27 November 1985), the Economic and Social Committee 
adopted the following opinion with no votes against and nine abstentions. 10. The Committee believes that a reduction of special 
taxes on the consumption of tropical agricultural products 
(tea, coffee, cocoa, bananas, pepper, etc.) may often be an 
effective way of helping the exports of developing countries. 
Alternatively, the revenue from such special taxes could be 
used, at least in part, to back development operations in the 
exporting countries. 
11. The Committee remains opposed to the creation of a 
GSP Committee with the task of 'advising' the Commission 
on Decisions which the latter is normally required to take in 
any case under the terms of the Treaty. 
12. The creation of such a Committee would make the 
decision-making process more cumbersome, protracted and 
expensive. But, above all, it would remove from certain 
Decisions (e.g. the re-imposition of customs duties) the 
automaticity which, given the imperfect international legal 
framework, is badly needed to ensure the transparency, 
objectivity and reliability of the scheme for both importers 
and suppliers. A 'non-automatic' decision-making process 
opens the door to pressure and perhaps even threats. 
13. The scope for automatic decision-making could be 
extended, and management methods improved, if ceilings 
were gradually replaced by quotas. In this connection the 
Committee would reiterate its earlier comments on the need 
to ensure that the Community has more immediate access to 
Done at Brussels, 28 November 1985. 
(!) OJ No C 42, 14. 2. 1985, p. 4.