ARCHIVES HISTORIQUES
DELACOMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (76)115
Vol.1976/0038

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COMMISSION OFTHEEUROPEAN COMMUNITIE
COM (76)115 final "
Brussels .31March 1976
Recommendation for a
COUNCIL "DECISION
onthenotification ofprovisional application
bytheEuropean Economic Community ofthe
International Cocoa Agreement ,1975
(submitted totheCouncil bytheCommission .)
V
C0M(76 )115 final

Commission Communication totheCouncil
relatingtotheInternational CocoaAgreement,
1975

-1-
I.TheUnitedWationsCocoaConference ,1975
TheInternational CocoaAgreement,1972,whichexpireson30
September1976,wasthesubjectoffreshnegotiations whichledtothe
conclusionoftheInternational CocoaAgreement,1975(Geneva,22
September-20October1975)•
ThenewAgreement-likeits1972predecessor-isbasedonadual
intervention mechanismwithinafixedrangeofprices:thatis,export
quotasandoperationsbyabufferstockof250000tonsofcocoabeans.
Thechargingofacontribution ontradeintheproductinorderto
financethebufferstockismaintained ,asarethecontrolsonthemember
countries'exportsandimportswhichthisentails.Theregulationof
importsfromnon-membercountriesandthepossibilityofsuspending
exportquotasinthelightofpricelevelsarealsoretainedinthenew
Agreement.
Manyamendmentshavebeenmadetotheseprovisions ,namelythe
substantialraisingofthepricerange\newconditionsforthereview
andrevisionoftheprices,stepstosimplifyandrendermoreflexible
thequotamachinery(whichisadaptedtomarketcharacteristics ),the
increasedroleofbufferstockoperationsparticularly intheeventof
afallinprices,andimprovedconditionsofsupplyforconsumercountries
thataremembersoftheAgreement.Moreover,thenewthree-yearAgree­
mentmaybeextendedfortwoyearswithoutfreshnegotiations .Itis
scheduledtoenterintoforceon1October1976•
ItmaybehopedthattheeconomicprovisionsofthenewAgreement
willbemoreeffectivethanthoseofthefirstAgreement.Becauseof
theworldmarketsituationandthehighpricesoftheproductsince
1973theprovisionsrelatingtostabilization ofthemarkethavenotyet
•/.
Theminimumprice,23UScentsperpoundunderthe1972Agreement
(raisedto29.5i*11974)>hasbeenfixedat39centsandthe
formermaximumpriceof32cents(raisedto38.5i*11974)has
beenfixedat55cents,whichmeansthattherangehasbeen
widenedfrom9to16cents.

-2-
beenabletofunction,butthesystemoffinancingthebufferstock
meansthat.largesumscanbemobilizedforpurchasesofcocoaby
thestock.ThefundswhichwillbeavailablewhenthefirstAgree­
mentcomestotheendofitsthree-yearperiodon30September1976
areestimatedat$85million.
II.TheroleoftheCommunityandtheMemberStatesinthenegotiations
Sincethisistheonlyinternational agreementcurrentlyin
forcewhichembodiesmeasurestocontrolexportsandimports,its
application wouldhavebeenimpossible-fromthestandpointofthe
commoncommercialpolicy-withouttheCommunityparticipating
(whichitdidfromthetimethe1972Agreemententeredintoforce)as
wellasalltheMemberStates.
Moreover,theAgreementbeingofa"mixed"nature,withthe
Communityhavingjurisdiction insomemattersandtheMemberStatesin
others,theCounciladoptedonaproposalfromtheCommissionin
September1975provisionsforthenegotiationofthesecondAgreement,
andtheseweresuccessfully implementedinthecourseofthework:
(i)theCommunitywasalio.zedtoparticipateautomatically inthe
Conference (insteadofinanobservercapacity);
(ii)theCommunityandtheMemberStateswererepresentedbyten
delegations ;
(iii)theCommissionrepresentative wasnormallythespokesmanonmatters
coveredbythecommoncommercialpolicyunderArticle113andon
matterswhichwerethesubjectofcommonactionunderArticle116;
(iv)thenegotiatingdirectives,whichwereannexedtotheCouncil
Decisionauthorizing theCommissiontonegotiateonbehalfofthe
CommunityinmatterswithintheCommunitycompetence ,were
adheredtoa
TheCommunitywasthereforeabletoplayamajorpartinthis
Conferencesince,forthefirsttimeinthecaseofa.mixedagreement,
the./holeofthenegotiations wereconductedatCommunitylevel,even

-3-
onthemostdifficultquestionssuchasthoseconcerningpricesana
themechanismsforintervention byreferencetopricelevels.
Thisresultwasmadepossibleonlybythespiritofcooperation
andthe./illtosucceeddisplayedbythetendelegationsthroughout
theConference .Inthisconnectionitwillberecalledthatthe
Communityaccountsfor40$ofworldimports(1972-74average),folio.ed
bytheUnitedStateswith23$andtheUSSRwith9$*
TheUnitedStates,whichisnotamemberofthe1972Agreement,
participated inthepreparatory workandinthe1975Conference ,at
.vhichitbelatedlyputforwardproposalsforasimplifiedagreement
basedmainlyonabufferstock.SincethesecondAgreement ./asnot
concludedonthisnewbasis,theUnitedStatesregardsitasunacceptable .
Ontheproducercountries'side,oneofthebiggestproducers
(ivoryCoast)wasunabletosupportthefinalcompromiseonpricelevels
andthemarketintervention mechanisms ;thisisthefirsttimean
international productagreementhasbeenconcludedwithoneofthe
principalproducercountriesstandingasidefromtheotherdeveloping
countries.Thefactisallthemoreremarkableinviewoftheexistance
ofaCocoaProducers'Alliance,comprisingBrazilandthefivemain
Africanproducercountries(Ghana,Nigeria,IvoryCoast,Cameroon,
Togo).
Ill.TheentryintoforceoftheAgreement :proposalsbytheCommission
The1975Agreementisopenforsignatureuntil31August1976
inclusiveandisscheduledtoenterintoforceprovisionally or
definitively on1October1976,subjecttothefollowingconditions :
fiveexportingcountriesaccountingforatleast80faofthebasic
quotasandimportingcountriesaccountingforatleastTOfoofworld
importsmusthavedepositedtheirinstrumentofratification orhave
givennotification bynotlaterthan30September1976thattheywill
applytheAgreementprovisionally .

-4-
Ontheexportingcountries'side,ifIvoryCoast-eretostand
byitsintentionnottosignoracceptthenetiAgreement,thechances
oftheAgreemententeringintoforceon1October1976.vouldbe
seriouslyjeopardizedinviewoftheconditionsstatedabove,since
IvoryCoastistheworld'sthirdlargestproducer(l5«5ofthebasic
quotas).
Asregardstheimportingcountries,thesituationiscomparable
tothatunderthe1972Agreement ;thatis,iftheUnitedStatesdoes
notparticipate ,theentryintoforceoftheAgreementwouldpre­
supposetheparticipation ofalltheotherprincipalimportingcountries,
.-.'hosedelegatestotheConferenceadoptedthenewAgreementprovided
it.-/asacceptedbyalltheprincipalexportingcountries.Forthis
reason,whileacknowledging theuncertainties surrounding thenew
AgreementarisingfromIvoryCoast'spositionandpendingtheresults
ofthediscussions amongtheprincipalexportingcountries,theCommission
considersthatitwouldbeappropriate-particularly as1976willbe
markedbythefourthsessionofUNCTADandtheworkoftheConference
onInternational EconomicCooperation-thattheCommunityandthe
MemberStatesshouldnotjeopardisethepossibleentryintoforceofthe
newAgreementandshouldmakethenecessarypreparations tobeableto
completetheprocedureswithintheperiodspecified.
TheCommission therefore recommendsthattheCouncil:
decidethatthe1975International CocoaAgreementwillbesignedassoon
aspossiblebefore31August1976onbehalfoftheEuropeanEconomic
Community,subjecttoconclusionoftheAgreement ;
adopt,inaccordancewiththetextannexedhereto,adecisiontothe
effectthattheCommunitywillnotifytheSecretary-General ofthe
UnitedNationsbefore30September1976thatitwillapplytheagree­
mentprovisionally ,asanimportingmember,whentheAgreemententers
intoforceinaccordancewithArticle69.ThetextoftheAgreement
willbeannexedtothedecision,whichwillbepublishedintheOfficial
JournaloftheEuropeanCommunities .ThisreferencetoArticle69
impliestheparticipation ofalltheprincipalexportingcountriesand
alltheprincipalimportingcountries,excepttheUnitedStates.

-5-
EvenifoneormoreMemberStateswereunabletocomplete
theseformalities withintheperiodspecified,itshouldstillbe
possiblefortheCommunitytodosoinordertoavoidanybreakin
continuityintheapplication oftherulesoftheAgreementcoveredby
thecommoncommercialpolicyintheeventofthenewAgreemententering
intoforceon1October1976"'".InthisconnectiontheCommission
wouldpointoutthatwhentheCounciladoptedtheDecisiononpartici­
pationbytheCommunityinthenegotiation ofthesecondAgreement,the
Councildrewattentiontothespecialdifficulties ofoneofthe
MemberStatesandexpressedtheviewthatasolutionshouldbeworked
outatCommunitylevelsothatthenewAgreementcouldbeappliedby
alltheMemberStatesandtheCommunity.
Lastly,inanticipation oftheforthcoming meetingsofthe
ExecutiveCommitteeandthesessionsoftheInternational CocoaCouncil
tobeheldinMarchandJuly1976,theCommissionproposesthatthe
CommunityandtheMemberStatesadoptsnopenandconstructive attitude
incaseitshouldprovenecessary,before1October1976,toconsider
analternativesolutiontotheentryintoforceofthe1975Agreement
onthatdate;possiblesolutionscouldbetheextensionofthe1972
AgreementpursuanttoArticle74(4)ofthatAgreementoraprotocol
maintainingtheAgreementinforceforaspecifiedperiod.
SeeCouncilRegulation (EEC)Ho3135/73of9November1973onthe
implementation oftheeconomicandcontrolrulesoftheInternational
CocoaAgreement,1972inOJNoL324of24November1973,p.20.

GMRATIOT:FOIÏACOUÎÎCILDÉCISION
ontho notification ofprovisional application bythe
European Econon-.ic Comas Tity ofthe International Cocoa
Ar;recmont ,i>'75
TUECCUNCT,;C7THEsuacrs/.NCOI;.UNTTIE3,
Ir.vinr rogor-' tntheTre&ty establishing the European Ucononic
Co rcunity and inparticular Article 113 thereof ,
Having repai dto'herecorrmondation from theCommission ,

Whereas the Cor,;:.iuni Lyisparticipating ini-heInterna lxcnn.1 Cocoa
Agreement ,1972 ;
Whereas theCouncil har .'Jcidcd tocijjn before 31August l??b the
International Cocoa A^rccnvrit ,1975 onbehalf oftheCommunity ,
subject toconclusion oftheAgreement ;
Whereas theCommunity should give notice that itwill apply
theAgreement provisionally pending completion oftheinternal
procedures necessary foritsconclusion ,
HASAPCPTED T'ISDECISION :
Sole Article
1. Inaccordance with Article Coofthe International Cococ ..
Agreement .1975 »the European Economic Community vill notify the
9
Secretary-General oftheUnited Nations before 30September 1976
that itwill r:pply theAgreement provisionally ,asanimporting
member ,when the Agreement enters into force inaccordance .-.ith
Article 69O
The te::t ofthe Agreement isannexed tothis Decision .
2. The President oftheCouncil ishereby authorized todesignate
1
the person empowered togive this notification .
The date from which the Agreement
will bepublished intheCficial
Communities .will beapplied provisionally
Journal ofthe European

Notif?,.rat i.on ofprovisional application
Inaccordance with Article 68ofthe Interna Lionel Cocoa
Agreement ,l'?75j the European Economic Community hr-rchy
•■ives notification ofprovisional application .In .jiving
this notification the Community will consider itself
provisionally animportine member ofthe above A--rec.vent
with 11the rights and obligations arisinc therefrom v:hcn
the Agreement enters into force inaccordance with Article
69anduntil thedate onwhich the t'ecision concluding
the A ;reer.ient isdeposited bytheCouncil oftheEuropean
Corrrnmi ties .