No C 59/48 Official  Journal  of the European  Communities 8. 3. 78 
Opinion  on the proposal  for a Council  Directive  on the harmonization  of provisions  laid 
down  by law,  regulation  or administrative  action  in respect  of standard  exchange  of goods 
exported  for repair 
The text  referred  to the Committee  has been  published  in Official  Journal  of the European 
Communities,  No  C 182  of 30 July  1977,  page  4. 
A. LEGAL  BASIS  FOR  THE  OPINION 
On 25 July  1977  the Council  referred  the abovementioned  proposal  to the Economic  and 
Social  Committee  in accordance  with  Article  100  of the Treaty  establishing  the European 
Economic  Community. 
B. OPINION  OF THE  ECONOMIC  AND  SOCIAL  COMMITTEE 
The Economic  and  Social  Committee  prepared  its opinion  on the above  matter  at its 153rd 
plenary  session  held  in Brussels  on 23 and  24 November  1977. 
The full text  of the opinion  is as follows: 
THE  ECONOMIC  AND  SOCIAL  COMMITTEE, 
Having  regard  to the Treaty  establishing  the European 
Economic  Community,  and  in particular  Article  100 
thereof, 
Having  regard  to the request  for an opinion  made  by 
the Council  of the European  Communities  on 25 July 
1977, 
Having  regard  to the decision  taken  by its chairman  on 
29 August  1977  instructing  the Section  for Industry, 
Commerce,  Crafts  and Services  to draw  up an opinion 
on the matter, 
Having  regard  to the opinion  issued  by that  Section  at 
its meeting  on 9 November  1977, 
Having  regard  to the  oral  report  submitted  by the 
rapporteur,  Mr Marvier, 
Having  regard  to the discussion  at its 153rd  plenary 
session  held  on 23 and  24 November  1977  (meeting  of 
23 November), 
HAS  ADOPTED  THE  FOLLOWING  OPINION 
unanimously: 
1. The  Committee  gave  its broad  approval  to the draft 
of the Directive  on customs  arrangements  for outward processing  traffic  (76/119/EEC),  and  it now  welcomes 
this draft  Directive,  which  extends  the customs  treat-
ment  accorded  under  Directive  76/119/EEC  to standard 
exchange  of goods  exported  for repair.  The  Committee 
considers  that  the proposed  application  of the equival-
ence principle  to this  traffic  — when  most  of the 
Member  States'  regulations  still  require  the exported 
and imported  goods  to be identical  — is a step  forward. 
It therefore  endorses  the draft  subject  to the comments 
set out below. 
2. Article  5 (3) 
2.1. Article  5 (3) requires  customs  authorities  to with-
hold the standard  exchange  treatment  'where  it would 
give rise to an unjustified  advantage  as regards  exemp-
tion from  import  duties'.  The  Commission  justifies  this 
provision  by the need  to maintain  adequate  customs 
protection  and  the danger  that  otherwise  a regular  rota-
tion of goods  could  develop,  with  exchanges  being  car-
ried out  simply  to benefit  from  the partial  exemption 
from  duties,  though  formally  within  the terms  of the 
Directive.  Although  the example  given  in support  of this 
argument  (the  replacement  of a second-hand  car  by 
another  second-hand  car  in better  condition),  seems 
rather  far-fetched,  the  Committee  understands  the 
Commission's  concern.  However,  the provision  decided 
upon  for this purpose  has in the Committee's  view  prac-
tical and  fundamental  drawbacks. 
2.2. Difficulties  are likely  in the application  of the pro-
vision  because  'unjustified  advantage'  is not defined  and 
8. 3. 78 Official  Journal  of the European  Communities No C 59/49 
some  customs  authorities  might  therefore  apply  the 
provision  in a, very  wide  sense  to the detriment  of the 
applicant. 
2.3. On  a point  of principle,  it hardly  seems  right  in a 
Directive  which  itself  lays  down  the conditions  of en-
titlement  to a certain  treatment  to then  exclude  from  the 
treatment  people  who  would  derive  'unjustified  advan-
tage'  from  it. If such  a loophole  exists,  it is for the text 
of the Directive  to close  it. The  Commission  does  in-
cidentally  say in the commentary  that  it may  review  its 
position  after  a trial  period. 
2.4. It would  certainly  be possible  to delete  Article  5 (3) 
after  this trial  period.  But,  in view  of the difficulties  that 
are usually  involved  in amending  legislation  subsequent-
ly, the Committee  suggests  the following  rewording  of 
Article  5 (3),  which  could  help  to solve  the problem 
immediately: 
Done  at Brussels,  23 November  1977. 'Article  5 (3) 
The competent  authorities  shall  withhold  the benefit 
of standard  exchange  where,  in spite  of the com-
bined  application  of Article  4 (2) above  and  Article 
8 (1) below,  it would  give  rise  to an unjustified 
advantage  as regards  exemption  from  import 
duties.' 
3. Article  6 (2) 
3.1. While  approving  the proposed  extension  of eligi-
bility  for the special  treatment  to cases  where  the re-
placement  product  is imported  before  the exchanged 
product  is exported,  the Committee  feels  that  a one-
month  time  limit  for  exportation  of the  exchanged 
product  is too  short  by current  administrative  and 
commercial  standards.  It therefore  proposes  that  the 
time limit  be raised  to two  months  with  a possibility  of 
extension  by a further  month. 
The Chairman 
of the Economic 
and Social  Committee 
Basil  de FERRANTI