Proposal for a Council Regulation suspending certain concessions set out in the Europe Agreement establishing an Association between the European Communities and their Member States, of the one part, and the Republic of Latvia, of the other part
Date: 2000-03-10
Institutions: European Commission
Subjects: Latvia, association agreement (EU), import, pigmeat

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 10.03.2000
COM(2000) 129 final

2000/0054 (ACC)

Proposal for a

COUNCIL REGULATION

suspending certain concessions set out in the Europe Agreement establishing an
Association between the European Communities and their Member States, of the one
part, and the Republic of Latvia, of the other part

(presented by the Commission)

1.

2.

3.

4.

5.

6.

EXPLANATORY MEMORANDUM

In accordance with the Directives adopted by the Council on 27 June 1996, the
Commission and the associated countries concerned have concluded negotiations on
Additional Protocols to the Europe Agreements. The Additional Protocols adjust
certain agricultural concessions provided for in the Europe Agreement
to take
account of the accession of the Republic of Austria, the Republic of Finland and the
Kingdom of Sweden to the European Union and the outcome of Uruguay Round
negotiations, including improvements to the existing preferential arrangements. The
Council approved the Additional Protocol on behalf of the Community by Council
Decision of 18 May 19981.

Following a decision of 25 May 1999 of the Government of the Republic of Latvia
and the subsequent approval on 27 May 1999 by the Parliament of the Republic of
Latvia, provisional safeguard measures were introduced against import into Latvia of
(CN 0203) originating inter alia in the European Community. The
pigmeat
provisional safeguard measures were extended by another two years as from
18 December 1999, following a decision on 7 December by the Latvian Government
that was approved on 9 December by the Latvian Parliament.

By adopting the definitive safeguard measures without prior referral of the matter to
the EU-Latvia Association Council,
the Republic of Latvia has not acted in
conformity with its obligations under Articles 33(2) and 33(3)(a) of the EU-Latvia
Europe Agreement, which provide for the matter being referred to the EU-Latvia
Association Council together with all relevant information with a view to seeking a
solution within 30 days.

Only technical consultations have been held between the Parties (on 26 May 1999,
15 June 1999, 12 October 1999 and 23 November 1999), but Latvia did not provide
all relevant information to the EU-Latvia Association Council prior to the adoption
of the definitive safeguard measures.

The Republic of Latvia has, moreover, failed to establish that the conditions required
in Article 30 of the EU-Latvia Europe Agreement for the adoption of safeguard
measures are fulfilled in this case. In particular, Latvia has failed to prove that
pigmeat originating in the Community has been imported into Latvia in such
increased quantities and under such conditions as to cause serious injury to Latvian
producers of like or directly competitive products.

Following the entry into force of the Latvian safeguard measures of pigmeat, the
Community’s operators suffer substantial economic losses due to the fact that they
no longer are able to export any pigmeat
the
Community’s interests, the Commission proposes that measures should be taken in
retaliation to the safeguard measures on pigmeat introduced by the Republic of
Latvia. Consequently, this Regulation provides for a suspension of the agricultural
concessions on butter, which the Community grants to the Republic of Latvia.

to Latvia. In order to protect

7.

The Council is requested to adopt the proposed Regulation.

1

OJ L 317 of 10.12.1999, p. 1.

2

2000/0054 (ACC)

Proposal for a

COUNCIL REGULATION

suspending certain concessions set out in the Europe Agreement establishing an
Association between the European Communities and their Member States, of the one
part, and the Republic of Latvia, of the other part

THE COUNCIL OF THE EUROPEAN UNION,

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

Having regard to the proposal from the Commission2,

Whereas:

(1)

(2)

(3)

(4)

The Protocol adjusting trade aspects of the Europe Agreement establishing an
association between the European Communities and their Member States, of the one
part, and the Republic of Latvia, of the other part, to take account of the accession of
the Republic of Austria, the Republic of Finland and the Kingdom of Sweden to the
including
European Union and the outcome of Uruguay Round negotiations,
improvements to the existing preferential arrangements3 which the Council decided to
conclude on 18 May 1998, entered into force on 1 March 2000. The Europe
Agreement provides for concessions in relation to agricultural products granted by the
Community and Latvia to each other on a harmonious and reciprocal basis, as set out
in Annex Va (Community concessions), Annex X and Annex XI (concessions by
Latvia).

On 1 June 1999 the Republic of Latvia introduced provisional safeguard measures on
pigmeat originating inter alia in the European Community without respecting its
obligations for consultation as laid down in Articles 33(2) and 33(3)(a) of Europe
Agreement establishing an association between the European Communities and their
Member States, of the one part, and the Republic of Latvia, of the other part4.

As from 18 December 1999 the Republic of Latvia adopted definitive safeguard
measures on pigmeat for a time period of two years.

The Community considers that the Republic of Latvia has failed to establish that the
conditions of Article 30 of the Europe Agreement with Latvia for the adoption of
safeguard measures are fulfilled in this case. In particular, Latvia has failed to prove
that pigmeat originating in the Community has been imported into Latvia in such

2

3

4

OJ C ….
OJ L 317 of 10.12.1999, p. 1.
OJ L 26 of 2.2.1998, p. 3.

3

increased quantities and under such conditions as to cause serious injury to Latvian
producers of like or directly competitive products.

As a consequence of the measures taken by the Republic of Latvia, the Community’s
exports to the Republic of Latvia of the products concerned have been seriously
restricted.

Under the Europe Agreement with Latvia this situation gives raise to the application of
Article 123(2) thereof.

It is appropriate to protect the Community’s trade interests by suspending certain of
the concessions set out in the Europe Agreement with Latvia which are equivalent to
in trade value of the Latvian safeguard measures on pigmeat on the
the effect
Community’s exports to Latvia.

As required by Article 123(2) of the Europe Agreement with Latvia, in the selection of
measures, priority must be given to those which least disturb the functioning of the
Europe Agreement.

Before taking these measures, the EU-Latvia Association Council was supplied with
all relevant information required for a thorough examination of the situation with a
view to seeking a solution acceptable to the Parties.

(5)

(6)

(7)

(8)

(9)

(10)

this Regulation are
Since the measures necessary for
management measures within the meaning of Article 2 of Council Decision
1999/468/EC of 28 June 1999 laying down the procedures for the exercise of
implementing powers conferred on the Commission5, they should be adopted by use of
the management procedure provided for in Article 4 of that Decision.

the implementation of

HAS ADOPTED THIS REGULATION:

5

OJ L 184, of 17.7.1999, p. 23.

4

Article 1

The following concessions set out in Annex V(a) of the Europe Agreement establishing an
association between the European Communities and their Member States, of the one part, and
the Republic of Latvia, of the other part, are hereby suspended:

Order No

CN Code

Descrip-
tion

Applicable
duty (% of
MFN)

Base
quantity
(tonnes)

Specific
provisions

from
1.7.1996
to 30.6.
1997
(tonnes)

from
1.7.1997
to 30.6.
1998
(tonnes)

from
1.7.1998
to 30.6.
1999
(tonnes)

from
1.7.1999
to 30.6.
2000
(tonnes)

From
1.7.2000

(tonnes)

0405 10

Butter

20

900

945

990

1 035

1 080

1 125

Article 2

The Commission shall repeal the measures set out in Article 1, in accordance with the
procedure laid down in Article 3(2), once the safeguard measures imposed by the Republic of
Latvia on imports of pigmeat originating in the European Community have been abolished.

Article 3

1.

2.

3.

The Commission shall be assisted by the Management Committee for Milk and Milk
Products instituted by Article 41 of Council Regulation (EC) No 1255/19996.

Where reference is made to this paragraph, the management procedure laid down in
Article 4 of Decision 1999/468/EC shall apply,
in compliance with Article 7(3)
thereof.

The period provided for in Article 4(3) of Decision 1999/468/EC shall be one month.

6

OJ L 160 of 26.6.1999, p. 48.

5

Article 4

This Regulation shall enter into force on the third day following its publication in the Official
Journal of the European Communities.

It shall apply to import licences issued after the date of the entry into force of this Regulation.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the Council
The President

6

1.

2.

3.

4.

5.

5.0

5.1

FINANCIAL STATEMENT

BUDGET HEADING:
Chapter 10: Agricultural duties
TITLE:
Council Regulation suspending certain concessions set out in the Europe Agreement establishing an
Association between the European Communities and their Member States, of the one part, and the
Republic of Latvia, of the other part

APPROPRIATIONS:
1 102,2 Mio EUR

LEGAL BASIS: Article 133 of the Treaty

AIMS:

To suspend certain concessions granted by the Community to the Republic of Latvia.

FINANCIAL IMPLICATIONS

12 MONTH
PERIOD

(EUR million)

CURRENT
FINANCIAL
YEAR [2000]
(EUR million)

FOLLOWING
FINANCIAL
YEAR [2001]
(EUR million)

CHARGED TO THE EC BUDGET

EXPENDITURE
-
(REFUNDS/INTERVENTIONS)
-
-
REVENUE
-
(LEVIES/CUSTOMS DUTIES)
NATIONAL
-

NATIONAL AUTHORITIES
OTHER

OWN RESOURCES OF THE EC

5.0.1 ESTIMATED EXPENDITURE
5.1.1 ESTIMATED REVENUE

5.2 METHOD OF CALCULATION:

See annex.

1,7

1,0

1,7

2002

1,7

2003

1,7

2004

2005

1,7

1,7

6.0

6.1

CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE
RELEVANT CHAPTER OF THE CURRENT BUDGET?

CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF
THE CURRENT BUDGET?

6.2 WILL A SUPPLEMENTARY BUDGET BE NECESSARY?

6.3 WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS?

YES

YES

NO

YES

OBSERVATIONS:

In the calculation it has been assumed that the quantities exported by the Republic of Latvia will remain
unchanged, despite the suspension of the preferential duties. If the Republic of Latvia stops exporting butter to
the European Union as a result of the suspension of the duties, this measure will result in a loss of own
resources equal to those anticipated to be received in 2000, i.e.0,4 million EUR. In this case, EU expenditure
requirements for export refunds could also be reduced by 1,9 million EUR (1 125 t x 1,700 EUR/t).

7

SUSPENSION OF CONCESSIONS GRANTED TO THE REPUBLIC OF LATVIA

ANNEX

CN Code

Description

Quota from
1.7.2000
(tonnes)

Bound rate
(EUR/t)
2000

Old rate
%
basic duty

New rate
%
basic duty

Reduced
duty
collected
within the
TQ in 2000
(EUR)

Full duty to
be collected
based on
imports
within the
TQ in 2000
(EUR)

Forecast
profit based
on imports
within the
TQ in 2000
(EUR)

0405 10

Butter

1 125

1 896

20

100

426 600

2 133 000

1 706 400

The quantities used in the calculation relate to the preferential tariff quotas granted by the EC
on imports of butter from Latvia as from 1 July 2000. On the basis of the EC imports of butter
originating in Latvia during the past three years, it can be assumed that the tariff quotas would
be fully used during this period.

If the suspension of the reduced duties were to put an end to exports of butter from Latvia to
the EU, this measure would result in a loss of own resources equivalent to those anticipated to
be collected in 2000.

8