Decision No 1/89 of the EEC-Egypt Cooperation Council of 30 August 1989 amending, as a consequence of the introduction of the harmonized system, Protocol No 2 concerning the definition of the concept of 'originating products' and methods of administrative cooperation
Date: 1989-08-30
Institutions: EEC–Egypt Cooperation Council
Subjects: Egypt, Union transit, administrative cooperation, movement certificate, originating product













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21989D1026(01)

Decision No 1/89 of the EEC-Egypt Cooperation Council of 30 August 1989 amending, as a consequence of the introduction of the harmonized system, Protocol No 2 concerning the definition of the concept of 'originating products' and methods of administrative cooperation  


Official Journal L 310 , 26/10/1989 P. 0002 - 0003 Finnish special edition: Chapter 11 Volume 15 P. 0120  Swedish special edition: Chapter 11 Volume 15 P. 0120  





DECISION No 1/89 OF THE EEC-EGYPT COOPERATION COUNCIL of 30 August 1989 amending, as a consequence  of the introduction of the harmonized system, Protocol No 2 concerning the definition of the  concept of 'originating products' and methods of administrative cooperationTHE  COOPERATION COUNCIL,  Having regard to the Cooperation Agreement between the European Economic  Community and the Arab Republic of Egypt, signed on 18 January 1977,  Having regard to Protocol No 2  concerning the definition of the concept of 'originating products' and methods of administrative  cooperation, and in particular Article 25 thereof,  Whereas the origin rules contained in Protocol  No 2 are based on the use of the Customs Cooperation Council Nomenclature; whereas the Customs  Cooperation Council approved the International Convention on the Harmonized Commodity Description  and Coding System (hereinafter referred to as the 'harmonized system') on 14 June 1983;whereas as  from 1 January 1988 the harmonized system was introduced for the purposes of international trade;  whereas it is therefore necessary to adapt the rules of origin contained in Protocol No 2 so that  they are based on the use of the harmonized system;  Whereas, in the light of experience, the  presentation of the origin rules could be improved by grouping all the exceptions to the basic  change of heading rule into one list and by providing detailed guidance on how it should be  interpreted,  HAS DECIDED AS FOLLOWS: Article 1In the last subparagraph of  Article 1 of Protocol No 2, the words 'in List C in Annex IV' are replaced by 'in Annex II'.  Article 2Article 3 of Protocol No 2 is replaced by the following:     'Article 3 1.    The  expressions ''Chapters'' and ''headings'' used in this Protocol shall mean the chapters and the  headings (four-digit codes) used in the nomenclature which makes up the ''harmonized commodity  description and coding system'' (hereinafter referred to as the ''harmonized system'' or  ''HS''). The expression ''classified'' shall refer to the classification of a product or material  under a particular heading.  2.    For the purposes of Article 1, non-originating materials are  considered to be sufficiently worked or processed when the product obtained is classified in a  heading which is different from those in which all the non-originating materials used in its  manufacture are classified, subject to the provisions of paragraphs 3 and 4.  3.    For a product  mentioned in columns 1 and 2 of the list in Annex III, the conditions set out in column 3 for the  product concerned must be fulfilled instead of the rule in paragraph 2.  4.    For the purpose of  implementing Article 1, the following shall always be considered as insufficient working or  processing to confer the status of originating product, whether or not there is a change of  heading: (a)  operations to ensure the preservation of merchandise in good condition during  transport and storage (ventilation, spreading out, drying, chilling, placing in salt, sulphur  dioxide or other aqueous solutions, removal of damaged parts, and like operations); (b)simple  operations consisting of removal of dust, sifting or screening, sorting, classifying, matching  (including the making-up of sets of articles), washing, painting, cutting up; (c)i(i)  changes of  packaging and breaking up and assembly of consignments; (ii)simple placing in bottles, flasks, bags,  cases, boxes, fixing on cards or boards, etc., and all other simple packaging  operations; (d)affixing marks, labels or other like distinguish- ing signs on products or their  packaging;     (e)simple mixing of products, whether or not of different kinds, where one or more  components of the mixture do not meet the conditions laid down in this Protocol to enable them to  be considered as originating; (f)simple assembly of parts of articles to constitute a complete  article; (g)a combination of two or more operations specified in subparagraphs (a) to  (f); (h)slaughter of animals.'  Article 3 Article 4 of Protocol No 2 is replaced by the following:    'Article 4 1.    The term ''value'' in the list in Annex III shall mean the customs value at the  time of the import of the non-originating materials used or, if this is not known and cannot be  ascertained, the first ascertainable price paid for the materials in the territory concerned. Where the value of the originating materials used needs to be established, this paragraph shall be  applied mutatis mutandis. 2.    The term ''ex-works price'' in the list in Annex III shall mean the  ex-works price of the product obtained minus any internal taxes which are, or may be, repaid when  the product obtained is exported.'  Article 4 Article 6 of Protocol No 2 is hereby amended as  follows: 1.  In paragraph 2, the expression 'Article 3 (3)' is replaced by 'Article 3 (4)', and the  words 'Brussels nomenclature' by 'harmonized system'. 2.The following paragraph is added:' 4.    Sets within the meaning of General Rule 3 of the harmonized system shall be regarded as originating  when all component articles are originating products. Nevertheless, when a set is composed of  originating and non-originating articles, the set as a whole shall be regarded as originating  provided that the value of the non-originating articles does not exceed 15  % of the ex-works price  of the set.'  Article 5 1.    Annexes I, II and III to this Decision replace Annexes I, II, III and  IV to Protocol No 2.  2.    Annexes V and VI are renumbered IV and V.  Article 6 1.    Products  which were exported before 1 January 1990, accompanied by a Movement Certificate EUR 1 or Form EUR  2, shall be considered as originating under the rules in force on 1 January 1990.  2.    Movement  Certificates EUR 1 or Forms EUR 2 issued or made out before 1 January 1990 under the rules in force  before that date shall be accepted up to and including 31 May 1990 according to the rules in force  when they were issued.  3.    Articles 19 and 20 of Protocol No 2 shall apply in the case of goods  exported before 1 January 1990 and retrospective or duplicate Movement Certificates may be issued  under the rules in force before that date.  Article 7 Decision 3/80 is hereby replaced by this  Decision.  Article 8 This Decision shall apply from 1 January 1990.  Done at Brussels, 30 August  1989.  For the Cooperation Council The President H. M. EL KAMEL  Joint Declaration concerning the review of the changes to the origin rules as a result of  the introduction of the harmonized system  Where, following the amendments made to the  nomenclature, the new rules introduced by Decision No 1/89 alter the substance of any rule existing  prior to Decision No 1/89 and it appears that such alteration results in a situation prejudicial to  the interest of the sectors concerned, then, if one of the contracting parties so requests in the  period up to and including 31 December 1992, an examination shall be made as a matter of urgency by  the Cooperation Council, of the need to restore the rule concerned as it was before Decision No  1/89. In any case, the Cooperation Council shall decide to restore, or not to restore, the  substance of the rule concerned within a period of three months of the request being made to it by  either of the parties to the Agreement. If the substance of the rule concerned is restored, then  the parties to the Agreement shall also provide the legal framework necessary to guarantee that any  customs duties improperly levied on the products concerned imported after 1 January 1990 can be  reimbursed. ANNEX IEXPLANATORY NOTESNote 1: Articles 1 and 2  The terms 'the Community' and 'Egypt'  shall also cover the territorial waters of the Member States of the Community and of Egypt  respectively. Vessels operating on the high seas, including factory ships, on which fish caught are  worked or processed, shall be considered as part of the territory of the State to which they belong  provided that they satisfy the conditions set out in Explanatory Note 4.  Note 2 - Article 1  The  conditions set out in Article 1 relative to the acquisition of originating status must be fulfilled  without interruption in the Community or Egypt. If originating products exported from the Community  or Egypt to another country are returned, they must be considered as non-originating unless it can  be demonstrated to the satisfaction of the customs authorities that: -  the goods returned are the  same goods as those exported,and  -they have not undergone any operations beyond that necessary to  preserve them in good condition while in that country.  Note 3 - Article 1  In order to determine  whether goods originate in the Community or in Malta it shall not be necessary to establish whether  the power and fuel, plant and equipment, and machines and tools used to obtain such goods originate  in third countries or not.  Note 4 - Article 2  (f)  The term 'their vessels' shall apply only to  vessels: -  which are registered or recorded in a Member State or in Egypt, -which sail under the  flag of a Member State or of Egypt, -at least 50  % of which are owned by nationals of the Member  States and Egypt or by a company which has its head office in a Member State or in Egypt, of which  the manager, managers, chairman of the board, and the majority of the members of such board are  nationals of the Member States or Egypt and of which, in addition, in the case of partnerships or  limited companies, at least halt the capital belongs to the Member States or to Egypt or to public  bodies or nationals of the Member States or of Egypt, -of which the captain and officers are all  nationals of the Member States or of Egypt, -of which at least 75  % of the crew are nationals of  the Member States or of Egypt.  Note 5 - Articles 2 and 3  1.  The unit of qualification for the  application of the origin rules shall be the particular product which is considered as the basic  unit when determining classification using the nomenclature of the harmonized system. In the case  of sets of products which are classified by virtue of General Rule 3, the unit of qualification  shall be determined in respect of each item in the set; this also applies to the sets of heading  Nos 6308, 8206 and 9605. Accordingly, it follows that: -  when a product composed of a group or  assembly of articles is classified under the terms of the harmonized system in a single heading,  the whole constitutes the unit of qualification, -when a consignment consists of a number of  identical products classified under the same heading of the harmonized system, each products must  be taken individually when applying the origin rules. 2.Where, under General Rule 5 of the  harmonized system, packing is included with the product for classification purposes, it shall be  included for purposes of determining origin.   Note 6 - Article 3  (1)  The Introductory Notes to  Annex III shall also apply where appropriate to all products manufactured using non-originating  materials even if they are not subject to a specific condition contained in the List in Annex III  but are subject instead to the change of heading rule set out in Article 3  (1).  Note 7 - Article 4  'Ex-works price' shall mean the price paid to the manufacturer in whose undertaking the last  working or processing is carried out, provided the price includes the value of all the products  used in manufacture.  'Customs value' shall be understood as meaning the customs value laid down in  the Convention concerning the valuation of goods for customs purposes signed in Brussels on 15  December 1950.   ANNEX II >TABLE> ANNEX III >TABLE>