ARCHIVESHISTORIQUES
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COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(77)81
Vol.1977/0031

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(77)81final.
Brussels,17March1977.
&ekIk&HBU®M
Proposalfora^
REGULATION(ESC)OPTHECOUNCIL
ontheopening!allocationandadministration ofaCommunity
tariffquotaforprocessingworkinrelationtocertaintextile
productsundertheoutwardprocessingtrafficarrangements of
theCommunity.
(submittedtotheCouncil "bytheCommission)
COM(77)81final

EXPLANATORY MEMOIUNDUM
InanArrangement .concluded with theSwiso Federation on1August 1969 ,
theEuropean Eoonomio Community undertook toopen anannual duty free ' .
Community tariff quota of1,870,000 units ofaccount ofadded value onthe
various kinds ofprocessing work forcertain textile produots included inthd
outward processing traffic oftheCommunity toSwitzerland .
Under thoterms »fthememorandum agreed atthetime theArrangement was "
made ,this annual tariff quota isdivided into three categories ofpro– .:
ceasing ,based onthequantities recorded under theformer "bilateral agree .– ■
ments (concluded with Switzerland byFrance ,Germany andItaly ),buttaking
into aocount thepossibilities ofextending ittotheBenelux countries ...
Onthobacis «fthat division thetotal quota amount of1,870,000 units of...
acoount isappropriated asfollows :
a)1,650,000 units ofaocount forprocessing work onwoven fabrics falling
« . . V *··
within Chapters 50to57oftheCommon Customs Tariff j
b)143,000 units ofaccount fortwisting orthrowing ,re-twisting cabling , .
texturizing (whether ornotcombined with ether processing work )ofyarns
falling within Chapters 50to57oftheCwmmen Customs Tariff ,
0)77,000 units ofaooount forprocessing work onarticles falling within •
headings 50.04,58*05 ,58.07 ,58.08 ,58.09 and60.01 ofthoCommon *
Customs Tariff .
0JNoL240 -24September 1969 .
mmm/••■
(

Attherequest oftheSwiss authorities andsothat thedivision ofthe
whole quota into 'thethree categories ofprooeaainff referred toabove should
"bebetter related totheactual movement ofvtrade 'during thereference year
which served asthebasis forcalculating thetotal amount ofthequota and
trade movements during recent quota periods orforeseeable movements ,itwas
decided tomake certain transfers between thethree quota amounts of
which thef^nal onewas 1l}0,000u.a «,transferring from thefigure alloca­
tedforprocessing -work onartiolos (category C)tothat setaside for
processing work onwoven fabrics falling within Chapters 50 "to57-Simi­
larly andinorder toallow recess tothetariff quota ,itwasdecided that
theCommunity reserves should beamalgamated andthat inthis waythenew
reserve could cover alltypes ofprocessing work regardless ofthecate­
gory they come under .
Thetotai quota amount of1,870,000 u.a.would beallocated among thethroe
categories asfollows :
-1,,520,000 u.a .forprocessing operations onwoven fabrics falling within
» •
Chapters 50to57of "theCommon Customs Tariff j ■
–123,000 u.a .forprocessing operations onwoven fabrics falling within
Chapf-eys 50to57oftheCCTj
–227,000 u.a .forprocessing woj^k onarticles falling within headings
53.04 'to60.01 oftheCCT ,subject tothesetting upofaCommunity re~
» *1
serve of2?0,000 u.a ,tobedrawn from theabove amounts ,that is160,000
u.a.,13*COOu.a ,and .57»000u.a .respectively .
Thequestion whether this Arrangement should continue beyond 31August 1977
hasbeen examined onseveral occasions ,notably atthemeeting oftheJoint
EEC-Swiss Commission held on3November 1976 ,inregard tothequotas which
should beadopted thenceforth ,account being taken ofthe fact that the
transitional period inthe Free Trade Agreement concluded with Switzerland ,
under which textile goods qualify forSwiss origin status byreason ofthe
processing work they have undergone andcanenter futy-free ,expires on
1July 1977 .

-3-
Untilsuchtimeastheeconomicdatarequiredforcalculatingthese
quotasareavailable,ithasbeendecidedbycommonaccordpurelyand
simplytorenewthecurrentlyopenquotasforatransitional period,
duringwhichtimethecontractingpartieswillendeavourtoobtain
therequireddata.
5.TheannexedproposalforaRegulationthereforeservesnoother
purposethantoopenthetariffquotaprovidedforintheArrangement
concernedfortheperiodbetween1September1977and31August1978,
andtoallocateitamongtheMemberStatesalongthelinessetoutin
theMemorandumcoveringthisArrangement,accountbeingtakenofthe
changesoccurringmeanwhileandoftheneedtoensurethatthenew
MemberStatesshareintheallocationofthistariffquota.
TheproposalforaRegulationannexedheretoprovidesfortheadministration
ofthoquota "bythosystemofpriorallocationanathatthemajcimvuaamount
returnedtothereserveshall"be20$oftheinitialshare.

AÎTNEX
Proposaifora
REGULATION (EEC)No.../f7OFTHECOUNCIL
of
ontheopening,allocationandadministration ofaCommunitytariffquotafor
processingworkinrespectofcertaintextileproductsunderCommunity
outwardprocessingarrangements
THECOUNCILOFTHEEUROPEAN
COMMUNITIES ,
Havingregardto(heTreatyestablishingtheEuropean
EconomicCommunity,andinparticularArticle113
thereof;tradeduringfuturequotaperiods,ithasbeendecided
toadjustthesaidallocationbetweenthethreecatego­
riesbygivingthem1520000,123000and227000
unitsofaccountrespectively ;whereastheCommu­
nitytariffquotainquestionshouldbeopenedforthe
periodISeptember1977to31August1978
accordingtotheprovisionslaiddowninthearrange­
mentspecifiedabove,andinamendmentstoit;
HavingregardtotheproposalfromtheCommission ;
Whereason1August1969theCommunity
concludedanarrangement withSwitzerlandon
processingtrafficintextiles;whereasunderthatarran­
gementtheCommunityundertooktoopenonI
SeptemberofeveryyearanannualdutyfreeCommu­
nitytariffquotaforprocessedgoodsof1870000
unitsofaccountofaddedvalue,apportionedas
follows:
(a)1650000unitsofaccountforpiocessingworkon
wovenfabricsfallingwithinChapters50to57of
theCommonCustomsTariff;
(b)143000amiitsofaccountforthetwistingor
throwing,cablingandtexturizing(whetheror*not
combinedwithotherprocessingworks)ofyarns
fallingwithinChapters50to57oftheCommon
CustomsTariff;
(c)77000unitsofaccount ,forprocessingworkon
productsfallingwithinheadingNos58.04,58.05,
58.07,5H.08,58.09and60.01ottheCommon
CustomsTariff;
Whereas,inorderthatthedivisionofthewholequota
intothethreecategoriesreferredtoaboveshallcorres­
pondmoreexactlywiththeactualmovementoftrade
duringthereferenceyearorduringpreviousquoin
periodsnswellaswiththeforeseeablemovementofWhereasprovisionshouldbemadeinparticularto
ensureequalandcontinuousaccessfor<:hose
concernedwiththisquotaandconsistentapp.ication
oftherateofdutyprescribedforthesaidquotauntil
thequotaisexhausted,toallgoodsre-importedinto
anyoftheMemberStatesandwhichnavereceived
oneorotherofthetreatmentslistedabove;whereas
inthelightottheseprinciplesarrangements forthe
utilizationofthequotabasedonanallocationamong
theMemberStateswouldseemtobeconsistentwith
theCommunitycharacterofthesaidquota;whereas,
itthereforeseemsappropriatetomaketheallocation
onthebasisoftheamountofthetrafficunderthe
previousbilateralagreements,butwithoutprecluding
participation byMemberStatesnotpreviously
involvedinsuchtraffic,amongwhichthenew
MemberStatesarcincluded;whereas,tosafeguardthe
Communitycharacterofthequota,provisionshould
bemadetomeetrequirementswhichmayarisein
thoseMemberStatesinthefuturepermittingthemto
drawadequateamountsfromtheCommunityreserve;
Whereastotakeaccountoffuturetrendsinthetraftic
inquestioninthevariousMemberStates,thetotal
quotavolumeofI870000unitsofaccountshouldbe
dividedintotwotranches,thefirstbeingallocated
amongcertainMemberStatesandthesecondheldas
areservetocoverthesubsequentrequirements of
MemberStateswhenoneoftheirinitialshareshave
beenexhaustedandalso,requirements whichmay
ariseincertainMemberStatesinrespectofprocessing0
workforwhichnoinitialshareof(hequotawasallo­
cated;whereasinordertogivethepartiesconcerned

ineachMemberStatesomedegreeofcertaintyit
wouldseemappropriatetofixthefirsttrancheofthe
Communityquotaatarelativelyhighlevel,namely
1640000unitsofaccount;whereasthetotalCommu­
nityreserveof2.10000unitsofaccountshallconsist
otamount*drawnfromtheallocationsinrespectof
eachcategory,thatis160000,13000and.57000
unitsofaccountrespectively ;
Where.!-,theMemberStatesmayexhausttheirinitial
sharesatditfercntrates;whereastoavoiddisruption
oisuppliesonlitisaccountitshouldbeprovided(hat
anyMemberStatewhichhasalmostuseduponeofits
initialsharesshoulddrawanadditionalsharefromthe
reserve;whereaseachtimeitsadditionalshareis
almostexhaustedaMemberStateshoulddrawa
furthershare,andsoon,asmanytimesasthereserve
allows;whereastheinitialandadditionalshares
shouldl:cvaliduntiltheendofthequotaperiod;
wherea*thisformofadministration requiresclose
collaborationbetweentheMemberStatesandthe
Commission,andtheCommissionmustbeinaposi­
tiontokeepaccountoftheextenttowhichthequota
hasbeenusedupandtoinformtheMemberStates
accordingly ;
Whereasifatagivendateduringthequotaperioda
considerablequantityofaMemberStatesinitialshare
remainsunuseditisessential,topreventapartofthe
quotafromremainingunusedinoneMemberState
whileitcouldbeusedinothers,thatsuchState
shouldreturnasignificantproportionthereoftothe
reserve;
Whereas,sincetheKingdomofBelgium,the
KingdomoftheNetherlandsandtheGrandDuchyof
Luxembourgareunitedinandjointlyrepresentedby
theBeneluxEconomicUnion,anytransactionin
connectionwiththeadministration ofthesharesallo­
catedtothatEconomicUnionmaybecarriedoutby
nnyoneofitsmembers,
HASADOPTEDTHISREGULATION :
Arlit'Ic/
I.AsfromISeptember 1977anduntil31August
1978,aCommunitytariffquotaof1870000unitsof
accountofvalueaddedshallbeopenedintheEuro­
peanEconomicCommunityinrespectofgoods
resultingfromprocessingworkasprovidedforinthe
arrangementwithSwitzerlandonprocessingtrafficin
textiles.Suchquotashallbeapportionedasfollows:
(a)1520000unitsofaccountforprocessingworkori
wovenfabricsfallingwithinChapters50to57of
theCommonCustomsTariff;
(b)12.1000unitsofaccountfortwistingorthrowing,
cablingandtcxturizing(whetherornotcombined
withotherprocessingwork)ofyarnsfallingwithin
Chapters50to57oftheCommonCustoms
Tariff;(c)227000unitsofaccountforprocessingworkon
articlesfallingwithinthefollowingheadingsof
theCommonCustomsTariff:
58.04Wovenpilefabricsandchenillefabrics
(otherthanterrytowellingorsimilarterry
fabricsofcottonfallingwithinheadingNo
55.08andfabricsfallingwithinheadingNo
58.05);
58.05Narrowwovenfabrics,andnarrowfabrics
(bolduc)consistingofwarpwithoutweft
assembledbymeansofanadhesive,other
.thangoodsfailingwithinheadingNo
58.06;
58.07Chenilleyarn(includingflockchenille
yarn),gimpedyarn(otherthanmetallized
yarnofheadingNo52.01andgimped
horsehairyarn);braidsandornamentaltrim­
mingsinthepiece;tassels,pomponsand
thelike; •
'58.08Tulleandothernetfabrics(butnot
includingwoven,knittedorcrocheted
fabrics),plain(a);
58.09Tulle-andothernetfabrics(butnot
includingwoven,knittedorcrocheted
fabrics),figured;handormechanically
madelace,inthepiece,instripsorir
motifs;
60.01Knittedorcrochetedfabric,notelasticor
rubberized .
2.ForthepurposesofthisRegulation :
(a)'processingworkmeans:
–forthepurposesofparagraph 1(a)and(c):
bleaching,dyeing,printing,flocking,impreg­
nating,dressingandotherworkwhichchanges
theappearanceorqualityofthegoods,without
howeverchangingtheirnature;
–forthepurposesofparagraph 1(b):twistingor
throwing,cablingandtcxturizing,whetheror
notcombinedwithreeling,dyeingorother
v/orkwhichchangestheappearance,qualityor
finishofthegoods,withouthoweverchanging
theirnature;
(b)'valueadded'means:thedifferencebetweenthe
valueforcustomspurposesasdefinedinRegula­
tion(EEC)No80.1/68(')atthetimeofre-importa-
tionandthevalueforcustomspurposesasit
wouldbeiftheproductswerere-importedinthe
stateinwhichtheywereexported.
3.EachportionaslaiddowninparagraphIshall
bedividedintotwotranches,thefirstbeingallocated
amongcertainMemberStatesinaccordancewith
Article3andthesecond,beingusedtoconstitutea
reservewhichshallbecommontothethreecategories
ofprocessing.
(')OJNoL148,28.6.1968,p.I.,

-3-
4.Withinthistariffquota,theCommonCustoms
Tariffdutiesshallbetotallysuspended.
5.Reimportsofproductsresultingfrom
thisprocessing workmaynotbechargedto
thetariffquotaiftheyarealreadyfree
ofcustomsHuti®sLingerotherpreferential
tariffarrangements .
Artide2
1.Thefirsttrancheofeachportionofthequotaas
laiddowninArticle1(1)shallbeallocatedassetout_
belowamongtheMemberStateslistedintheabove
arrangement;theshares,subjecttoArticle6,shallbe
validfrom1September1977to31August19^.
(a)Germany:
1080000
follows:unitsofaccount,apportioned as
*–850000unitsofaccountforprocessingwork
onwovenfabricsfallingwithinChapters50to
57oftheCommonCustomsTariff;
–100000unitsofaccountfortwistingor
throwing,cablingandtexturizing(whetheror
notcombinedwithotherprocessingwork)of
yarnsfallingwithinChapters50to57ofthe
CommonCustomsTariff;
–130000unitsofaccountforprocessingwork
onproductsfallingwithinheadingNos58.04,
58.05,58.07,58.08,58.09and60.01ofthe
CommonCustomsTariff:
(b)France:
520000unitsofaccount,apportionedasfollows:
–500000unitsofaccountforprocessingwork
onfabricsfallingwithinChapters50to57of
tiieCommonCustomsTariff;
–20000unitsofaccountforprocessingworkon
productsfallingwithinheadingNos58.04,
58.05,58.07,58.08,58.09and60.01ofthe
CommonCustomsTariff;
(c)Italy:
20000unitsofaccount,i.e.halffortwistingor•
throwing,cablingandtexturizing(whetherornot
combinedwithotherprocessingwork)ofyarns
fallingwithinChapters50to57oftheCommon
CustomsTariff,andhalfforprocessingworkon
productsfallingwithinheadingNos58.04,58.05,
58.07,58.08,58.09and60.01oftheCommon
CustomsTariff;
(d)Bénélux:
20()00unitsofaccountforprocessingworkon
threadsandwovenfabricsfallingwithinChapters50to57orforproductsfallingwithinheading
Nos58.04,58.05,58.07,58.08,58.09and60.01of
theCommonCustomsTariff.
2.Thesecondtranchewhichamountsto230000
unitsofaccountshallconstituteaCommunityreserve
whichmaybeusedforthethreecategoriesof
processing.
Article3
Incaseofneed,eitherinFranceinrespectofthe
processingworkreferredtoinArticle1(1)(b),orin
anyofthenewMemberStatesinrespectofanyofthe
categoriesofprocessingwork,theStateconcerned
shall,totheextentthatthereservesopermits,draw
fromsuchreserveasufficientshareofthequota.
Article4
1.IfaMemberStatehasused90%ormoreofone
ofitsinitialsharesasfixedinArticle2(1),orofthat
shareminusanyportionreturnedtothereserve
pursuanttoArticle6,itshallforthwith,bynotify;t
theCommissiondrawasecondshare,totheextent
thattherelevantreservesopermits,equalto10%of
itsinitialshare,roundedupasnecessarytothenext
wholenumber.
2.IfaMemberState,afterexhaustingoneofits
initialshares,hasused90%ormoreofthesecond
sharedrawnbyit,thatMemberStatesshall,inaccor*
dancewiththeconditionslaiddowninparagraph 1,
drawathirdshareequalto5%ofitsinitialshare.
3.IfaMemberState,afterexhaustingitssecond
share,hasused90%ormoreofthethirdsharedrawn
byit,thatMemberStateshall,inaccordancewiththe
samecondition,drawafourthshareequaltothethird.
Thisprocessshallcontinuetoapplyuntilthereserve
isexhausted.
4.Notwithstanding paragraphs 1to3,aMember
Statemaydrawshareslowerthanthosespecifiedin
thoseparagraphsiftherearegroundsforbelieving
thatthosespecifiedmaynotbeusedinfull.Any
MemberStateapplyingthisparagraphshallinform
theCommissionofitsgroundsforsodoing.
ArticleJ
AdditionalsharesdrawnpursuanttoArticle4shallbe
validuntil31August1978s

.;-4-
Article6
TheMemberStatesreferredtoinArticle2shall,not
laterthanlJuly-1978,returntothereservethe
unusedportionoftheirinitialsharewhich,on15Jurn"
1978isinexcessof20%oftheinitialvolume.They
mayreturnagreaterportioniftherearegroundsfor
believingthatitmaynotbeusedinfull.
MemberStatesshallnotlaterthanlJuly1978notify
theCommissionofthetotalquantitiesoftheproduct
inquestionre-importeduptoandincluding15Juni
1978andchargedagainsttheCommunityquotaand
ofanyportionoftheirinitialquotasreturnedtothe
reserve.
'• •
Article7
TheCommissionshallkeepanaccountoftheshares
openedbytheMemberStatespursuanttoArticles2,3
and4andshallassoonastheinformationreachesit,
informeachStateoftheextenttowhichthereserve
hasbeenusedup.
Itshall,notlansrthanSJuly1978,informthe
MemberStatesoftheamountsstillinreserve
followinganyreturnofsharespursuanttoArticle6.
Itshallensurethatwhenanamountexhaustingthis
reserveisdrawntheamountsodrawndoesnotexceed
thebalanceavailable,andtothisendshallnotifythe
amountofthatbalancetotheMemberStatemaking
thelastdrawing.. ,.
Article8
1..MemberStatesshalltakeallappropriate
measurestoensurethatadditionalsharesdrawnpursuanttoArticle4areopeneoinsuchawaythat
re-importation maybechargedwithoutinterruption
againsttheiraccumulatedsharesofthequota.
2.EveryMemberStateshalladministeritsshares
byasystemofpriorallocation.Itshallensurethatall
personsestablishedinitsterritoryinvolvedinthe
processingtraffichavefreeaccesstothesharesallo­
catedtoit.
3.Th£extenttowhichaMemberStatehasusedup
itssharesshallbedeterminedonthebasisofthevalue
added,asestablishedwhenuponre-importation the
productsconcernedareenteredwiththecustoms
authoritiesforhomeuse. ..
Article9
AttherequestoftheCommission ,theMemberStates
shallinformitofre-importations chargedagainst
theirshares.
Article10 \
MemberStatesandtheCommissionshallcooperate
closelytoensurethatthis'Regulationiscomplied
with. 1
ArticleÎ1 n
r •
ThisRegulationshallenterintoforceon1September
.»977., .,,
ThisRegulationshallbebindinginitsentiretyanddirectlyapplicableinallMember
7States* :v.
i.DoneatBrussels,
"' ■I*<i
'v::i>
'Κ'·
FortheCouncil
■';rThePresident