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DOCUMENTS "COM"
COM(76)326
Vol.1976/0097

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COMMISSION OFTHEEUROPEAN COMMUNITIES
'I
i.
/ "
■- COM(76)326final.
' Brussels,23June1976.
DraftACP-EECCouncilofMinistersDecisionderogating
■
fromtheconceptoforiginating productsinordertoI
takeintoaccountthespecialsituationofMauritius
withregardtocertainproductsofthetextileindustry
■
(submittedtotheCounciltoy.theCommission)
Λ'
■Λ
../
•/
COM(76)326final.

Explanatory Memorandum
I.Submission ofthe request
Byletters of19September 1975 and2April 1976 the
Government ofMauritius forwarded totheCommission through its
Charg£ d'Affaires inBrussels ,arequest forderogation from the
definition oftheconcept oforiginating products inrespect ofan
annual quantity of3000000mofunbleached fabrics over aperiod
oftwoyears .
These 6000000mrepresent 1664 tandaccording tothe
letter of2April 1975 they would bebroken down asfollows t
United Kingdom :2020000m(575t)
Federal Republic ofGermany :1040000m(254 t)
Prance :1100000m(524t)
Belgium :1840000m(311t).
Mauritius wants tocreate anintegrated textile chain from
spinning tothefinished product viatheweaving ,bleaching ,dyeing
andprinting stages .Unfortunately Mauritius does nothave sufficient
capital toconstruct allthenecessary plants atthesame time and ,
ifitbegan with thespinning unit ,would have noimmediate wayof
using theyarn produced .Itwasdecided ,therefore ,tobegin by
building aweaving unit which would useimported yarn ,mainly from
Pakistan ,inorder toproduce unbleached fabrics intended primarily
forexport totheCommunity countries .
Then thebleaching ,dyeing andprinting unit aswell as
thespinning works would beconstructed some twoyears after the
weaving unit Btarted operating .Mauritius would thus have aninte­
grated textile complex andthefinished products would befully
entitled tooriginating status ,whereas ,asinthefirst stage
planned -fabrics manufactured from non-originating yarn -they do
notmeet theconditions foracquiring this status ,namely manufacture
from rawcotton ,cotton waste orcarded cotton .
./•

Frty-five percent ofthocapital isMauritian ,55/®Pakistani ,
the yc-~n would come from Padistan andIndia ,the industial equipment
was bought inBelgium andGermany and saleB contracts have already
been signed with French ,Belgian ,German andBritish firms .
According torecent information ,production tests axeunder way .
The Government ofMauritius has stressed tbo vital role of
this textile complex andconsiders atemporary derogation from the
rules oforigin essential ;moreover ,this request was thesubject of
anagreement among theACPStates .Itisbased ontheprovisions of
Article 27ofProtocol No1totheLome Convention andonparagraphs
4and 5 Annex IXtoProtocol No1.
Since this request waspresented byall theACPStates during
ameeting oftheCustoms Cooperation Sub-Committee on16February 1976 »
themaximum period ofsixmonths stipulated inArticle 27ofProtoool
No1will expire inmid-August .Asadecision must bereached by
that date ,itwould beadvisable forthis matter tobeexamined at
ameeting oftheACP-EEC Council ofMinisters whioh oould beheld in
July .
II.The Commission' sopinion
Thearguments putforward byMauritius comply with the
criteria laid down intheConvention .The request relates tothe
creation ofanewindustry (Article 27ofProtocol Nol)andthe
produots tobeused originate indeveloping countries (India ,Pakistan )
with which Mauritius hasaspecial relationship (Annex IX(3))*
From theeconomic point ofview itispointed outbythe
relevant Commission departments that theMauritian request concerns
anextremely sensitive industrial sector .Atpresent theCommunity
textile industry isfacing real difficulties connected toalarge
extent with theimports ofcotton fabrics from developing countries ,
andtoimport anyadditional quantities could aggravate analready
delicate situation .

•>.fcshould benoted ,however ,that thequantities inquestion
(1664 t)arefairly modest inrelation totheCommunity 'stotal
imports ofcotton fabrics ,which amounted to168761 tin1974 .
Moreover ,zero duty tariff quotas were opened forcertain
developing countries under thegeneralized systmn ofpreferences ,
amounting to8802 tin1976 ,andadditional imports maystill be
effected under thesame conditions within theCommunity ceiling .
Thetextile agreements provide forquotas ofabout 127000 t
(although without anytariff concessions ).Thequestion maybe
asked ,therefore ,whether theI664 twhich arethesubject ofthe
request forderogation arelikely seriously todisturb thebalance
ofthetextile sector andsince ,astheMauritian authorities have
assured theCommunity ,thefabrics produced from 1978 onwill have
originating status andmaytherefore beimported freely ,postponing
access totheEECmarket bytwoyears risks being more politically
disadvantageous than economically effective .
Itmay also bepointed outthat itisaquestion here of
unbleached cotton fabrics ,tobeprooessed intheCommunity by
textile firms and that this will have beneficial effects for these
fizms .
Since this first -andonly -request forderogation complies
with the criteria laid down inProtocol No1tothe Lome Convention
and inAnnex IXtothat Protocol and since itdoes not seem to
constitute aserious threat fortheCommunity because ofthemodest
quantities involved ,theCommission proposes tomeet theMauritian
request andtoaccord thederogation .Inorder todisturb traditional
trade flowB aslittle aspossible ,however ,this derogation should
inanycase notexceed aperiod oftwoyears ,regardless ofthe
state ofintegration reached attheendofthat period bythetextile
complex being setupandwhatever thequantities delivered .
TheCommission therefore proposes thefollowing draft decisioni
./■

-4-
Draft ACT-EEC Council ofMinisters Decision No
derogating from theconcept oforiginating products inorder to
take into account thespecial situation ofMauritius with regard
tocertain products ofthetextile industry .
THEACP-EEC COUNCIL OPMINISTERS ,
Having regard totheLome Convention signed on28February 1975
between theEuropean Economic Community andtheAfrican ,Caribbean
andPacifio States ,
Having regard totheproposal from theCommission ,
Having regard tothereport oftheCustoms Cooperation Committee ,
Whereas Article 27ofProtocol No1totheLomS Convention concerning
thedefinition oftheconcept of'originating products' andmethods
ofadministrative cooperation provides forderogations from thesaid
rules oforigin ,notably tofacilitate thedevelopment ofexisting
industries ortheoreation ofnew industries ;
Whereas theGovernment ofMauritius has submitted arequest foratwo-
year derogation from thedefinition set out inProtocol No1tothe
Lom6 Convention fortextile products manufactured inthat State ;
Whereas inorder totake into account thespecial situation ofMauritius
and toenable the industrial sectors conoerned tosetupnew industrial
plants which necessitate derogations from thesaid Protocol ,provision
should bemade foratwo-year derogation from thedefinition setout
intheProtocol referred toabove ,
HAS DECIDED ASFOLLOWS :
Article 1
Byway ofderogation from thespecial provisions ofList AinAnnex II
toProtocol No1totheLom£ Convention concerning thedefinition of
'originating products' andmethods ofadministrative cooperation ,
textile products manufactured inMauritius andfalling within tariff
heading Noex55»09 "unbleached woven fabrics ofcotton ",shall be
considered asoriginating inMauritius under theconditions setout
below . •/•

Artici?2
Thisderogationconcernsthefollowingquantities :
-from1July1976to30June1977s
ex55«09sunbleachedwovenfabricsofcotton:832metrictons
-from1July1977to30June1978:
55.09:unbleachedwovenfabricsofcotton:832metriotons
Article3
Themovementcertificates EUR1issuedpursuanttothisDecision
shallbeendorsedwithoneofthefollowingphrases:
-"marchandisesréputéesoriginairesenvertudeladécisionn*/
duConseildesMinistres ACP-CEE"
-"Ursprungserzeugnisse imSinnegemässBeschlussNr./76des
Hinisterrates AKP/EWG"
"mercioriginarieinvirtùdelladecisionen./7ódel
ConsigliodeiMinistriACP-CEE"
-"goederenvanoorspronguithoofdevanBesluitNr./76van
deACS-EEGRaa'.vanMinisters"
-"originating productsbyvirtueofACP-EECCouncilofMinisters
DecisionNoH6"
-"varermedoprindelsesstatus ihenholdtilDenbeslutningnr.
/l6afMinisterrådet ASV-EØF"
Thisendorsementshallbeenteredundertheheading'Remarks'.
Article4
Thecompetentauthorities ofMauritiusshallforwardtotheCommission
everythreemonthsastatementofthequantitiesinrespectofwhich
movementcertificates EUR1havebeenissuedpursuanttothis
Decision,indicatingtheMemberStatesofdestination.
Article5
TheACPStates,theMemberStatesandtheCommunityshall,eachone
foritspart,takethemeasuresrequiredforimplementation ofthiB
Decision.

Article 6
This Decision shall enter into force on1July 1976 .
Itshall beapplicable ,onaprorata basis asregards the
quantities ,until 30June 1978 .
Done at For the ACP-EEC Counoil ofMinisters
The President