WRITTEN QUESTION E-3863/00

by Concepció Ferrer (PPE-DE) to the Commission

(8 December 2000)

Subject: The Commission's Everything but arms initiative

The practical measures deriving from the Commission's Everything but arms proposal submitted in September this year will enable the world's 48 poorest countries to reduce their growing marginalisation in an increasingly globalised economy.

However, the proposal, welcome as it is, requires the adoption of measures to prevent the transhipment of merchandise to those countries.

What measures has the Commission adopted or does it intend to adopt in this connection?

Joint answer to Written Questions E-3863/00 and E-3978/00 given by Mr Lamy on behalf of the Commission

(13 March 2001)

The Honourable Members are referring to the recent Commission proposal(1) for a Regulation amending Council Regulation (EC) No 2820/98 of 21 December 1998 applying a multiannual scheme of generalised tariff preferences for the period 1 July 1999 to 31 December 2001 so as to extend duty-free access without any quantitative restrictions to products originating in the least-developed countries(2).

With regard to the possibility of least-developed countries (LDCs) utilising non-LDC products under this initiative, one should distinguish between fraudulent and non fraudulent ways of doing so.

In order to address the risk of fraud, the Commission has proposed to reinforce the existing anti-fraud clause. The reinforced clause provides a tool for tackling the risk of fraud by specifying that massive increases in Community imports of LDC products, beyond the level reflecting prevailing economic conditions such as normal production and export capacities in LDCs will be regarded as evidence of fraud.

In other, non fraudulent cases, the current rules of origin, and in particular the minimum value-added conditions attached to regional cumulation of origin allow trade of LDCs with other developing countries within the region but also provide that trade benefits will correspond to significant economic activity in the LDCs.

Similarly, the possibility that LDCs export their domestic production to the Community, while covering their domestic consumption needs by imports from non LDCs (triangular trade), would not be fraud. However, this import/export swap is constrained, notably by poor LDCs infrastructures.

As far as procedural aspects are concerned, the Commission proposal for amending Council Regulation (EC) No 2820/98 is based on Article 133 (ex Article 113) of the EC Treaty which despite the Commission's efforts in the Inter-Governmental Conference does not foresee consultation of the Parliament. However, the Commission has been sensitive to the political importance of the matter for the Parliament and has therefore briefed the Parliament as early as possible on the proposal. Wide-ranging discussions have already taken place. In the sugar sector, the proposal has also been presented to the social partners and discussed with numerous representatives of the sector. As you certainly know, efforts are intensifying within the Council to strike a legitimate balance between the different interests involved.

(1) COM(2000) 561 final.

(2) OJ L 357, 30.12.1998.