[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |

Brussels, 16.9.2008

COM(2008) 554 final

2008/0178 (ACC)

Proposal for a

COUNCIL DECISION

on the conclusion of an Agreement in the form of an Exchange of Letters between the European Community and the Republic of Cuba

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. With the accession of the Republic of Bulgaria and Romania, the EC has enlarged its customs union. Consequently, the EC is obliged under WTO rules (GATT Article XXIV:6) to enter into negotiations with third countries having negotiating rights in schedules of any of the acceding Members in order to agree on compensatory adjustment. Such adjustment is due if the adoption of the EC’s external tariff regime results in an increase in tariff beyond the level for which the acceding country has bound itself at the WTO, whilst taking ‘due account of reductions of duties on the same tariff line made by other constituents of the customs union upon its formation’.

2. On 29 January 2007, the Council authorised the Commission to open negotiations under Article XXIV:6 of GATT 1994 (COM proposal 16703/06 WTO 270).

3. The Commission has negotiated with the Members of the WTO holding negotiating rights with respect to the withdrawal of specific concessions in relation to the withdrawal of the schedules of the Republic of Bulgaria and Romania, in the course of their accession to the European Community.

4. Negotiations have been conducted by the Commission in consultation with the Committee established by Article 133 of the Treaty and within the framework of the negotiating directives issued by the Council.

5. The negotiations have resulted in an Agreement in the form of an exchange of letters with the Republic of Cuba.

6. This proposal asks the Council to approve this Agreement.

2008/0178 (ACC)

Proposal for a

COUNCIL DECISION

on the conclusion of an Agreement in the form of an Exchange of Letters between the European Community and the Republic of Cuba

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 133 in conjunction with the first sentence of the first subparagraph of Article 300(2) thereof,

Having regard to the proposal from the Commission,

Whereas:

(1) On 29 January 2007 the Council authorised the Commission to open negotiations with certain other Members of the WTO under Article XXIV:6 of GATT 1994, in the course of the accessions to the European Community of the Republic of Bulgaria and Romania.

(2) Negotiations have been conducted by the Commission in consultation with the Committee established by Article 133 of the Treaty and within the framework of the negotiating directives issued by the Council.

(3) The Commission has finalised negotiations for an Agreement in the form of an Exchange of Letters between the European Community and the Republic of Cuba. The Agreement should be approved.

(4) The measures necessary for the implementation of this Decision should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission[1],

HAS ADOPTED THIS DECISION:

Article 1

The Agreement in the form of an Exchange of Letters between the European Community and the Republic of Cuba on the conclusion of GATT Article XXIV:6 negotiations with respect to the withdrawal of specific concessions in relation to the withdrawal of the schedules of the Republic of Bulgaria and Romania in the course of their accession to the European Community is hereby approved on behalf of the Community.

The text of the Agreement is annexed to this Decision.

Article 2

The Commission shall adopt the detailed rules for implementing the Agreement in accordance with the procedure referred to in Article 39(2) of Council Regulation (EC) No 318/2006[2].

Article 3

The President of the Council is hereby authorised to designate the person(s) empowered to sign the Agreement in the form of an Exchange of Letters referred to in Article 1 in order to bind the Community.

This Decision is addressed to the Member States.

Done at Brussels, […]

For the Council

The President […]

AGREEMENT

AGREEMENT IN THE FORM OF AN EXCHANGE OF LETTERS

between the European Community and the Republic of Cuba pursuant to Article XXIV:6 and Article XXVIII of the General Agreement on Tariffs and Trade (GATT) 1994 relating to the modification of concessions in the schedules of the Republic of Bulgaria and Romania in the course of their accession to the European Union

A. Letter from the European Community

Geneva, 19 March 2008

Sir,

Following negotiations under Article XXIV:6 and Article XXVIII of the General Agreement on Tariffs and Trade (GATT) 1994 relating to the modification of the Schedules of the Republic of Bulgaria and Romania in the course of their accession to the European Union, the European Community and the Republic of Cuba have agreed as follows:

The European Community will incorporate in its schedule, for the customs territory of the EC-27, the following modification:

Add a country allocation (for Cuba) of 10000 tonnes to the current volume of 106925 tonnes in the EC tariff rate quota for raw cane sugar for refining (CN code 1701 1110),maintaining the present in-quota rate of 98€/t/net.

For marketing year 2008/2009 the country allocation for Cuba will be 20000 tonnes. As from the marketing year 2009/2010 the country allocation for Cuba will be 10000 tonnes.

The Republic of Cuba accepts the European Community approach to netting-out of tariff rate quotas as a way of adjusting the GATT obligations of the EC-25 and those of the Republic of Bulgaria and Romania following the recent enlargement of the European Community.

This agreement will enter into force two months after the date of the signed letter from the Republic of Cuba.

On behalf of the European Community

AGREEMENT

B. Letter from the Republic of Cuba

Geneva, 19 March 2008

Sir,

With reference to your letter stating:

’Following negotiations under Article XXIV:6 and Article XXVIII of the General Agreement on Tariffs and Trade (GATT) 1994 relating to the modification of the Schedules of the Republic of Bulgaria and Romania in the course of heir accession to the European Union, the European Community and the Republic of Cuba have agreed as follows:

The European Community will incorporate in its schedule, for the customs territory of the EC-27, the following modification:

Add a country allocation (for Cuba) of 10000 tonnes to the current volume of 106925 tonnes in the EC tariff rate quota for raw cane sugar for refining (CN code 1701 1110), maintaining the present in-quota rate of 98€/t/net.

For marketing year 2008/2009 the country allocation for Cuba will be 20000 tonnes. As from the marketing year 2009/2010 the country allocation for Cuba will be 10000 tonnes.

The Republic of Cuba accepts the European Community approach to netting-out of tariff rate quotas as a way of adjusting the GATT obligations of the EC-25 and those of the Republic of Bulgaria and Romania following the recent enlargement of the European Community.

This agreement will enter into force two months after the date of the signed letter from the Republic of Cuba.’

I hereby have the honour to express my government’s agreement.

On behalf of the Republic of Cuba

LEGISLATIVE FINANCIAL STATEMENT FOR PROPOSALS HAVING A BUDGETARY IMPACT EXCLUSIVELY LIMITED TO THE REVENUE SIDE

1. NAME OF THE PROPOSAL:

Proposal for a Council Decision on the conclusion of an Agreement in the form of an Exchange of Letters between the European Community and the Republic of Cuba relating to compensatory adjustment as provided for by Article XXIV:6 of GATT 1994.

2. BUDGET LINES:

Chapter and Article: Chapter 10 - Agricultural duties

Amount budgeted for the year concerned: 1 683.2 Mio €

3. FINANCIAL IMPACT

( Proposal has no financial implications

( Proposal has no financial impact on expenditure but has a financial impact on revenue – the effect is as follows:

(€ million to one decimal place)

Budget line | Revenue[3] | 12 month period, starting dd/mm/yyyy | Year 2008 |

Article 100… | Impact on own resources | […] | - 2.4 |

Article … | Impact on own resources | […] | […] |

Situation following action |

[n+1] | [n+2] | [n+3] | [n+4] | [n+5] |

Article … |

Article … |

4. ANTI-FRAUD MEASURES

5. OTHER REMARKS

[1] OJ L 184, 17.7.1999, p. 23. Decision as amended by Decision 2006/512/EC (OJ L 200, 22.7.2006, p. 11).

[2] OJ L 58, 28.2.2006, p.1. Regulation as last amended by Regulation (EC) No 1260/2007 (OJ L 283, 27.10.2007, p. 1).

[3] Regarding traditional own resources (agricultural duties, sugar levies, customs duties) the amounts indicated must be net amounts, i.e. gross amounts after deduction of 25 % of collection costs.