Proposal for a COUNCIL DECISION on a Community position within the EU - Mexico Joint Committee relating to Annex III to Decision No 2/2000 of the EU - Mexico Joint Council of 23 March 2000, concerning the definition of the concept of 'originating products' and methods of administrative cooperation

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. Preferential rules of origin are essential to the correct functioning of the free trade agreements between the Community and its trading partners, including Mexico. The European Communities and its Member States, of the one part, and the United Mexican States, of the other part, have signed an Economic Partnership, Political Coordination and Cooperation Agreement which entered into force on 1 October 2000 [1]

[1] Council Decision of 28 September 2000. OJ L276 of 28.10.2000, p. 44.

Annex III to Decision No 2/2000 of the EU - Mexico Joint Council [2] concerns the definition of the concept of originating products and methods of administrative cooperation and has entered into force on 1 July 2000.

[2] OJ L 245 of 29.9.2000, p. 953

2. A Joint Declaration to the Agreement provides that the Joint Committee shall review the necessity to extend beyond 30 June 2003 the application of temporary origin rules [3] applicable to certain chemical products of headings 2914 and 2915.

[3] Notes 2 and 3 of Appendix II(a) to Annex III to EU - Mexico Joint Council Decision No 2/2000. OJ L 245 of 29.9.2000, p. 1058.

3. Such review was based on several elements, including the availability of the necessary raw chemical materials within the preferential trading area, as well as potential investments in Mexico. A temporary extension of more flexible origin rules for the products considered shall have the effect of avoiding disruption of trade for goods that are essentially exported under preferential treatment from Mexico to the Community. On the other hand a limited-in-time extension, as opposed to a definitive one, should have the effect of stimulating investments in Mexico that would result in the local production of raw chemical materials. The processing of those locally manufactured raw chemicals would permit the fulfilment of 'standard' preferential rules of origin for the products covered by Notes 2 and 3 of Appendix II(a).

4. Having considered the above elements, the Joint Committee shall take a decision with a view to extending beyond 30 June 2003 and until 30 June 2006 the application of the above-mentioned temporary rules of origin.

5. The Commission therefore calls on the Council to draw up a common position for presentation to the EU - Mexico Joint Committee.

2003/0336 (ACC)

Proposal for a COUNCIL DECISION on a Community position within the EU - Mexico Joint Committee relating to Annex III to Decision No 2/2000 of the EU - Mexico Joint Council of 23 March 2000, concerning the definition of the concept of 'originating products' and methods of administrative cooperation

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 133,

Having regard to the proposal from the Commission,

Whereas Joint Declaration V to the Decision No 2/2000 [4] of 23 March 2000 of the EU - Mexico Joint Council established by the Economic Partnership, Political Co-ordination and Co-operation Agreement between the European Community and its Member States, of the one part, and the United Mexican States, of the other part, signed in Brussels on 8 December 1997 (hereinafter "Decision 2/2000") provides that the EU - Mexico Joint Committee established by that agreement shall review the necessity to extend beyond 30 June 2003 the application of the rules of origin set out in Notes 2 and 3 of Appendix II(a) to Annex III to Decision 2/2000.

[4] OJ L 245 of 29.9.2000, p. 953, last modified by EU - Mexico Joint Committee Decision of 20 December 2002 (OJ L 44 of 18.2.2003, p. 97)

HAS DECIDED AS FOLLOWS:

The position to be adopted by the Community within the Joint Committee established by virtue of the Economic Partnership, Political Co-ordination and Co-operation Agreement between the European Community and its Member States, of the one part, and the United Mexican States, of the other part, signed in Brussels on 8 December 1997, is that set out in the attached draft decision of the Joint Committee.

Done at Brussels,

For the Council

The President

Economic Partnership, Political Co-ordination and Cooperation Agreement between the European Community and its Member States, of the one part, and the United Mexican States, of the other part

Draft

Decision No..../2003 of the European Union - Mexico Joint Committee

relating to Annex III to Decision No 2/2000 of the EU - Mexico Joint Council of 23 March 2000, concerning the definition of the concept of 'originating products' and methods of administrative cooperation

THE JOINT COMMITTEE,

Having regard to Decision No 2/2000 of the EU - Mexico Joint Council of 23 March 2000 (hereinafter "Decision No 2/2000"), and in particular Notes 2 and 3 of Appendix II(a) to Annex III and Joint Declaration V thereto;

Whereas:

(1) Annex III to Decision No 2/2000, concerning the definition of the concept of "originating products" and methods of administrative cooperation sets out the rules of origin for the products originating in the territory of the Parties to the Agreement.

(2) According to Joint Declaration V, the Joint Committee shall review the necessity to extend beyond 30 June 2003 the rules of origin established in Notes 2 and 3 of Appendix II(a) to Annex III, where the economic conditions which formed the basis for establishing the rule set out in those Notes continue.

(3) In accordance with the analysis of the relevant economic conditions undertaken according to Joint Declaration V, it is considered appropriate to extend on a temporarily basis the application of the origin rules established in Notes 2 and 3 of Appendix II(a) to Annex III.

Has decided as follows:

Article 1

The origin rules set out in Notes 2 and 3 of Appendix II(a) to Annex III to Decision No 2/2000, shall be applied until 30 June 2006 instead of the origin rules set out in Appendix II to Annex III to Decision No 2/2000.

Article 2

This Decision shall enter into force on 1 July 2003.

Done at [...]

For the Joint Committee

LEGISLATIVE FINANCIAL STATEMENT

The proposed Joint Committee Decision has no financial impact.