WRITTEN QUESTION E-3941/00

by Christopher Huhne (ELDR) to the Commission

(13 December 2000)

Subject: Trade barriers for candidate countries

Will the Commission state what proportion of the total exports of each candidate country and what proportion of the country's exports to the EU are currently subject to some form of trade restriction (quotas, tariffs) on entry into the European Union?

Is the Commission of the view that non-tariff barriers in the EU may be a significant obstacle?

Answer given by Mr Lamy on behalf of the Commission

(22 March 2001)

Trade between the Community and the candidate countries is governed by the Europe Agreements (EAs) in the case of the 10 Central and Eastern European countries (CEECs), Association Agreements with Malta and Cyprus and a Customs Union (CU) with Turkey.

Trade liberalisation between the candidate countries and the Community has taken place progressively and in an asymmetric manner, with the Community liberalising trade towards the candidates immediately after the signature of the agreements and with the candidates opening their markets to the Community progressively.

With regard to the first question, the Honourable Member is reminded that tariffs should not automatically be equated to trade restrictions, as long as they are not set at prohibitive levels, and are applied in a manner which is transparent and consistent with World Trade Organization (WTO) rules and obligations. Insofar as tariff quotas are concerned, the quotas applied to Community imports from the candidate countries are far from being quantitative restrictions. On the contrary, they are preferential quotas, at tariff rates which are reduced or even zero, and are designed specifically to foster exports from the beneficiary countries.

For the countries which concluded the first EAs in the early 1990s, free trade in industrial goods has been established. By 1 January 2002 all trade in industrial goods between the Community and the EA countries will be fully liberalised, with no tariffs and no quotas applicable between the partners. Overall, approximately 94 % of all candidates' exports to the Community will be fully liberalised by this date.

As regards agricultural products, liberalisation of trade has taken place in a more progressive manner. In addition to the initial provisions of the Europe Agreements, under which agricultural imports took place at a reduced tariff rate within tariff quotas initially based on traditional trade flows, but were increased annually since the entry into force of these Agreements, agreements were concluded with the candidates in the course of 2000, aiming at further liberalisation of trade in agricultural products. As a result of these agreements approximately 80 % of agricultural products from the CEECs enter the Community free of import duties. At the same time, negotiations aiming at the full liberalisation of fish and fisheries products are currently underway.

Furthermore, negotiations on the liberalisation processed agricultural goods will increase the percentage of duty free products entering the Community from the candidates duty free.

With regard to the second question, the answer depends on how the term non-tariff barrier is defined. Such clear non-tariff barriers as quantitative restrictions or import levies are inconsistent both with the WTO obligations of the Community and with the terms of the Europe Agreements and Association Agreements, as well as with the CU with Turkey. On the other hand, sanitary or phytosanitary standards are frequently perceived as non-tariff barriers, but they are merely measures to protect human, plant or animal life or health, and as such are fully compatible with the bilateral and multilateral obligations of the Community. Such measures are not discriminatory as they apply equally to domestic production for the internal Community market. Any effect on candidate country exports will of course disappear as soon as they conform to Community standards.

With regard to technical standards, certification of conformity with Community standards may be perceived as a non-tariff barrier, or at least as hindering the free flow of goods. In this respect, the Community is in the process of negotiating with the candidates Protocols to the EAs on Conformity Assessment (PECAs). The PECA is a mutual recognition agreement in which the mutual recognition is based on the Community acquis. The PECA provides the opportunity to extend certain benefits of the Internal Market in certain sectors already aligned with the Community technical legislation. PECAs are based on progress made by candidate countries in implementing the acquis communautaire: as soon as the national legislation and practice of the applicant country in a given sector is aligned with those of the Community, manufacturers may have their products certified either in the country of origin or of destination, on the basis of the same standards, technical requirements and procedures.

PECAs have been signed so far with Hungary and the Czech Republic, and a framework agreement has been signed with Latvia. Negotiations are ongoing with Lithuania, Estonia, Slovakia and Slovenia.