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COM(76)324
Vol.1976/0096

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(76)324 final
Brussels/23June1976 ,
(
DraftJointCommittee_Decision(EEC-Morocco )
derogatingfor1976and1977fromthedefinitionofthe
conceptof"originatingproducts"totakeaccountofMorocco's
specialsituationincertaintextileproducts
inforaCouncilRegulation
derogatingfor1976and1977fromtheprovisionsconcerning
theconceptof"originatingproducts"containedintheAgreement
onco-operation andtheinterimAgreementbetweentheEuropean
EconomicCommunityandtheKingdomofMorocco
(submittedbytheCommissiontotheCouncil)
C0MC76)324final

EXPLANATORY NOTE
The new Lists Aand Bannexed totheOrigin Protocol tothe Agreement
with Morocco have introduced a6eriou6 barrier toexports totheCommu­
nity ofMoroccan clothing classified under headings 61.01 to61.0 ^.
These products ,which ,under the1969 Origin Protocol ,satisfied the
conditions oforigin since they were manufactured from unbleached
fabrics from third countries ,will nolonger beregarded asoriginating
products upon theentry into force ofthenewAgreement and thenew
List Arules ,which nolonger permit theuse ofunbleached fabrics from
third countries ,since they provide that weaving mu6t becarried out
inMorocco .These new rules ,which aremore restrictive inthe case in
point ,are ,ofcourse ,part ofa6etofrules which theCommunity has
proposed toitsMediterranean co-contracting parties with aview to
harmonizing List 'sAand B.They are insome cases more liberal ,and
inothers more restrictive ,than the oldrules .During thenegotiations
with Morocco ,theMoroccans asked that awhole series ofmodifications be
made totheproposed rules concerning the form ofcumulation tobechosen
(which wasmuch more liberal than that actually selected ),thedefinition
oftheexpression "their vessels "andalso various headings inList A
covering textiles ,mechanical engineering andelectronics inparticular .
Thenegotiations proved successful asregards origin ,solutions inpar­
ticular being found for theproblems ofcumulation and thepowers ofthe
Council .With regard totheamendments toList Arequested byMorocco ,
theCommunity stated itswillingness toexamine atalater date any
practical difficulties that arose .
Close contacts and asurvey carried outwith theMoroccan producers
concerned have revealed that anumber ofproblems exist inthe case of
some products covered byChapters 58and61andalso heading 51.01*.
Generally speaking thesurvey shows that links between Morocco and the
Community arevery close .Morocco isatraditi-nal customer ofseveral
Community countries .Inagreement with theMoroccan authorities ,ithas
been possible ,onthebasis ofthis close relationship ,todisregard
theproducts inquestion covered byheading 51*0 ^andChapter 58,inres­
pect ofwhich products Morocco isnolonger seeking derogations from
List A,thereby being compelled torely ontheCommunity forcontinuing
supplies ofintermediate products .
Theonly outstanding problems concern theproducts covered byheadings
61.01 ,61.02 ,61.03 and61.04.Ever since thetime ofthecountry 's
earlier relations with France ,themanufacturing process forthese
goods inMorocco has been .influenced bytherules oforigin .Whenever
therules were changed ,Morocco adapted itsproduction processes tothe
new .more restrictive rules .

-2-
For instance ,thfliberal rules previously applied byFrance were
replaced in1969 bytherules banning theworking ofdyed fabrics from
third countries .Inorder tocomply with these newrules onorigin ,
Moroccan industrialists purchased dyed fabrics from theEEC .After a
number ofyears theEECwas nolonger inaposition toEupply Morocco
with dyed fabrics and theindustrialists concerned have had tofind
other ways ofsatisfying therules oforigin laid down inthe1969
EEC-Morocco Agreement .They had tobuy from France anentire dyeing
factory ,which included among other things German machinery andwhich
has now been installed inMorocco .Indoing so,they have had totackle
and solve major problems never before experienced bytheready-made clothing
industry ,since dyeing is,forthat industry ,acompletely newprocess
pertaining rather tothechemical industry .Soasnot tobedependent
onthird countries ,Moroccan dyers have set upconsultancy and design
firms todeal with themixtures ofcolours tobeapplied tothe various
fabrics .Atany event ,anew dyeing industry was set upinMorocco
solely totake account oftherules oforigin ,forcompared with the
ready-made clothing industry itemploys very fewworkers .
Inaddition todyeing ,theindustry inMorocco undertakes theprinting
ofcertain fabrics .Itis,incidentally ,easy toestablish that ,with
regard totheconcept ofsufficient processing ,both processes ,printing
anddyeing ,areequally important ,dyeing being even more complicated
than printing .
The 1969 rules oforigin confer thestatus oforiginating products on
fabrics printed bythepartner country subject tocertain conditions
(List D)andoncldhing obtained after dyeing operations have been
carried out onunbleached fabrics imported from third countries and
also after operations resulting intheworking offabrics printed in
Morocco .Consequently ,inthese particular sectors *Morocco has been
able ,under the19&9 Agreement ,toexport totheCommunity clothing
covered byChapter 61andoriginating inMorocco .Although ,in
theexports totalled about 2200metric tons ,orDH9031^000 (DH1»
approx .FF0.910 ),theMoroccan trade balance fortextiles isstill
indeficit .(1).
Once thenewList Arules enter into force ,under which dyeing carried
out inMorocco will nolonger beregarded asamanufacturing stage that ,
followed bythemaking upofthe fabrics inthat country ,confers the
status oforiginating products onclothing obtained inMorocco ,the
articles ofclothing inquestion will nolonger beregarded asorigi­
nating products .This will bring about adeterioration inMorocco 's
existing trade deficit with theCommunity asregards textiles inpar­
ticular .Morocco will have nooption but torely onsupplies ofunbleached
fabrics which originate intheCommunity orinanother Maghreb country .
Moroccan industrialists have looked into thematter without coming up
with any solution.' Consequently ,Morocco ,anxious asalways tocomply
with thenewrules onorigin ,has stepped upitsplans toestablish a
local weaving industry .Construction offactories ,thecapital forwhich
will come ,asinthecase oftheready-made clothing industry andthe
dyeing industry ,from domestic sources orfrom joint Moroccan /Community
sources ,isexpected tostart next year .
(1)SeeAnnex Iforbreakdown ofexports in1975 *

-3-
There arealso plans toextend theproduction capacity ofanumber of
existing weaving factories .Itwill ,ofcourse ,besome time before
these plans areimplemented .
Accordingly ,Morocco has requested aderogation from thenew rulo of
origin for aperiod offive years asfrom theentry into force ofnew
Origin Protocol .Thesurvey carried outhas shown that this derogation
could belimited toanannual amount of2500tons .Itisproposed that
theCommission decide infavour ofthis derogation given that thequan­
tities inquestion were previously exported under the1969 Agreement
and that ,asexplained above ,Morocco has ,,inthepast ,endeavoured 'to
comply with therules oforigin .
Customs experts from theMember States have been consulted onthis
draft ;they have suggested that from atechnical point ofview some
provisions concerning control should beincluded inthetext andthey
said that they would need tobeassured ofthenon-availability of
unbleached cloth originating intheCommunity .
Inregard tothefirst point Article kofthedraft takes account of
theobservations made bytheexperts *heconcerns thenon-availability
oftheproducts concerned intheCommunity ,these products could perhaps
besupplied byoneormore Member State ,butonly atnon-competitive
prices .Given that this case consists ofallowing Morocco tocontinue
fortwoyears analready established activity onthebasis ofexisting
contracts ,itseems that apossible raising' oftheprice would bein
contradiction with the aim desired .
Asthis derogation has toenter into force asfrom thedate ofentry
into force oftheprovisions oftheintermediary Agreement ,theCom­
mission should recommend totheCouncil toadopt the draft oftheEEC-
Morocco Joint Committee Decision inAnnex II,asthecommon position of
theCommunity for that Joint Committee .Inaddition ,before that the
Joint Committee canadopt this Decision ,itisnecessary that theCom­
mission recommends totheCouncil toadopt theproposed Regulation in
Annex III ,inorder that theeffective entry into force oftheprovisions
concerned shall be1July 1976 .
Itisproposed that this derogation shall begranted foratwo-year period .
However ,taking into consideration theperiod ofapplicability ofthe
interim agreement ,thedraft decision andtheproposition foraregulation
are forthetime being limited totheJOJune 1977 *

t*- ANNEX I
Exports oforiginating products from Morocco under the previous rules
These figures cover11months of1975
EEC !
COUNTRIES... I
I
[ FRANCE
iGERMANY ITALY B.L.En•W•
Tariff
headingsValue m
DH '000Metric
tonsValue xn
DH •000Metrie
tonsValue m
DH '000Metric
tonsValue in
DK '000Metric
tons
61.0130.837 927ΠΓΛΐδ 134 584, 16117,4651 255
|61.02 8,444 1623.147 1031,168 33 184 3
61.0311.683 194999 15 5 0,2 24412
61.04 |854 10 .1 Nil Nil Nil 63
I I
prand total !51.8181.2938.605 2521.757 17.956 271
EEC
COUNTRIESTHE NETHERLANDS UNITED KINGDOM IRELAND DENMARK
Tariff
headingsValue in
DH ■000Metric
tonsValue in
DH '000Metric
tonsValue xn
DH •000Metric
tonsValue in
DH '000Metric
tons
61.01 2.248 70146 5 0,3■l '■ –
•Nil 0,8r-'ii
61.02 214 517 0„4 Nil 1 Nil
61.03 Nil Nil 1 Nil Nil Nil 21 0.3 .
61.04 Nil Nil 2 Nil Nil !Nil Nil Nil
prand total2,462 75166 1-r1 Nil 22,80.3
Total for11months(1975):DH82,787-900 Exports over 12months :DH90,314000
1945j7 metric tons 2/I22metric tons

5ANNEX II
Draft Joint Committee Decision No /7bderogating for1976 and
1977 from thedefinition oftheconcept of'originating products "
totake account ofMorocco 'sspecial situation incertain textile
products
THE JOINT COMMITTEE ,
Having regard totheInterim Agreement between theEuropean Economic
Community andtheKingdom ofMorocco ,signed inRabat on22April 1976 ,
andinparticular Article 28oftheProtocol concerning thedefinition
oftheconcept oforiginating products and onmethods ofadministrative
co-operation ,which forms anintegral part ofthat Agreement ;
Whereas inorder totake account ofMorocco 'sspecial situation and
toenable theindustries concerned toadapt their production to
theconditions required bythedefinition oftheconcept of"originating
products ",that State should begranted aderogation from thedefinition set
out inthe said Protocol ;
HAS DECIDED s
Article 1
Byway ofderogation from the special provisions laid down inList A
annexed totheProtocol on thedefinition oftheconcept of
originating products and onmethods ofadministrative co-operation ,subject
tothefollowing Articles ,theprovisions ofthat list concerning textile
products manufactured -inMorocco which fall within headings Nos61.01 ,61.02 ,
61.03 or61.04 oftheBrussels Tariff Nomenclature shall bereplaced bythe
provisions intheAnnex hereto . .
Article 2 ,
For 1976 and1977 this derogation involves thefollowing amounts :
-for1976 >1250metric tons
-for 1977t1250metric tons

Article 3
Themovement certificates EUR .1issuedunderthisDecisionshall
bearoneofthefollowingendorsements :
-"textile derogation "
-"dérogation textiles "
-"Abweichung fürSpinnstoffe "
-"deroga tessili "
-"afwijking voor textielprodukten "
-"Undtagelsesbestemmelser fortekstilstof "
TheendorsementshallbemadeinSectionNo7"Remarks".
Article
TheMoroccan customs authorities shall communicate every three months
totheCommission thequantities oftheproducts forwhich the certi­
ficates mentioned inArticle 3have been issued .The Commission shall
communicate this information tothe Member States .
Article 5
TheContractingPartiesshall,asfaraseachisconcerned,takethenecessary
measuresforcarryingoutthisDecision.
Article 6
ThisDecisionshallapplyonaproratabasisasregardsthequantities
until30June1977»
Done atBrussels . For the Joint Committee
The Chairman

-7-
ANNEX
ProductsobtainedWorkingorprocessingWorkingorprocessing
whichconferthestatue
of'originating products
whenthefollowing ,
conditions aremetCustoms
Tariff
heading'Descriptionthatdoesnotconfer
thestatusof
'briginating product
61.01Men'sandboys*
outergarmentsI
Manufacture fromyarn
orunbleachedtextile
fabrics
61.02Women's,girls'
andinfants'
outergarmentsManufacture fromyarn
orunbleachedtextile
fabrics
61.03Men'sandboys'
undergarments ,
includingcollars,
shirtfrontsand
cuffsManufacture fromyarn
orunbleachedtextile
fabrics
61.0**Women'B,girls'
andinfants'
undergarments 'Manufacture fromyarn
.orunbleachedtextile
fabrics

ANNEX III
-8-
Proposition for aCouncil Régulation (EEC )No /76of 1976
derogating for1976 and1977 from theprovisions concerning theconcept
of"originating products "contained intheAgreement onco-operation and
theinterim Agreement between theEuropean Economic Community and the
Kingdom ofMorocco .
THECOUNCIL OFTHEEUROPEAN COMMUNITIES ,
Having regard totheTreaty establishing theEuropean Economic Community
andinparticular Article 113thereof ,
Having regard totheproposal from theCommission ,
Whereas anAgreement onco-operation and aninterim Agreement between
theEuropean Economic Community and theKingdom ofMorocco were signed
inRabat on22April .1976 ,
Whereas inorder .totake account ofMorocco 'sspecial situation and
toenable theindustries concerned to .adapt their production to
theconditions required bytheProtocol on thedefinition ofthe
concept oforiginating products annexed tothose Agreements ,itis
necessary' toprovide for that State aderogation from the
provisions concerning thedefinition setoutinthe said Protocol ,
HAS ADOPTED THIS REGULATION :
Article 1
Bywayofderogation from theProtocol on thedefinition oftheconcept
oforiginating products annexed totheAgreement onco-operation and
the interim Agreement between theEuropean Economic Community and the
Kingdom ofMorocco ,subject tothefollowing Articles ,theprovisions ofList A
annexed totheProtocot onthedefinition oftheconcept of"originating products
andonmethods ofadministrative co-operation ,forming anintegral part ofthese
Agreements ,concerning textile products manufactured inMorocco which fall "within
headings Nos61.01 ,61.02 ,61.03 or61.04 oftheBrussels Tariff Nomenclature ,
shall bereplaced bytheprovisions intheAnnex hereto .
Article 2
For 1976 and1977 this derogation concerns anamount
fixed asfollows :
-for 1976 f1250metric tons
-for 1977 S1250 metric tons

Article 3 t .;
Themovement certificates EUR.1 issued under this Regulation shall bear
one ofthefollowing endorsements : ^
-"textile derogation "
-"dérogation textiles "
-"Abweichung fürSpinnstoffe " .
-"deroga tessili "
-"afwijking voor textielprodukten "
-"Undtagelsesbestemmelser fortekstilstof "
Theendorsement shall bemade inSection No7"Remarks ".
Article H
TheMoroccan customs authorities shall communicate every three months
totheCommission thequantities oftheproducts forwhich thecerti­
ficates mentioned inArticle Jhave been issued .The Commission shall
communicate this information tothe Member States *
Article 5
This Regulation shall enter into force on1July 1976 *
»
Itshall apply onaprorata basis asregards thequantities until -
30Juné 1977 .
This Regulation shall bebinding initsentirety anddirectly applicable
inall Menber States *
*
«
Done atBrussels . For the Council
The President
• .. .

10-
*■■ >.
»• •» ■>AKKVX
ProductsobtainedWorkingorprocessing, I
Workingorprocessing
rfhichconfersthestatus
of"originating products
v/henthefollowing
conditions aremetCustoms
Tariff
headingDescriptionthatdoesnotconfer
thestatusof
"originating products"
61.01Men'sandboys'
outergarmentsI
Manufacture fromyarn
orunbleachedtextile
fabrics
61.02Women's,girls'
andinfants'
outergarmentsManufacture fromyarn
orunbleachedtextile
fabrics
61.03Men'sandboys'
undergarments ,
includingcollars,
shirtfrontsand
cuffsManufacture fromyarn
orunbleachedtextile
fabrics
61.04Women's,girls'
andinfants'Manufacture fromyarn
orunbleachedtextile
undergarments|fabrics J
0
•••♦