2001/822/EC: Council Decision of 27 November 2001 on the association of the overseas countries and territories with the European Community ("Overseas Association Decision")
Date: 2001-11-27
Institutions: Council of the European Union
Subjects: association agreement (EU), development aid, international cooperation, overseas countries and territories

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(Acts whose publication is not obligatory)

COUNCIL

COUNCIL DECISION

of 27 November 2001

on the association of the overseas countries and territories with the European Community

(‘Overseas Association Decision’)

(2001/822/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, hereinafter referred to as the Treaty, and in partic-
ular Article 187 thereof,

Having regard to the proposal from the Commission,

Whereas:

(1)

(2)

Council Decision 91/482/EEC of 25 July 1991 on the
association of the overseas countries and territories with
the European Economic Community (1), was applicable
until 1 December 2001. Article 240(4) thereof states
that
the Council, acting unanimously on a proposal
from the Commission, shall establish the provisions to
be laid down for the subsequent application of the prin-
ciples set out in Articles 182 to 186 of the Treaty.

Declaration No 36 on the overseas countries and terri-
tories, hereinafter referred to as the ‘OCTs’, annexed to
the final act of the Conference of the Representatives of
the Member States
the Governments of
signed in
Amsterdam in 1997,
invites the Council, acting in
accordance with Article 187 of the Treaty, to review the
association arrangements with the OCTs with a fourfold
objective as follows:

— promoting the economic and social development of

the OCTs more effectively;

— developing economic relations between the OCTs

and the European Union;

— taking greater account of the diversity and specific
including

characteristics of
aspects relating to freedom of establishment;

the individual OCTs,

— and ensuring that the effectiveness of the financial

instrument is improved.

(3)

(4)

(5)

(6)

(7)

On 11 February 1999 the European Parliament adopted
a resolution on relations between the OCTs, the ACP
States and the outermost
the European
Union (2). Furthermore, on 4 October 2001, it adopted a
resolution on the proposal from the Commission for a
Council Decision on the association of the OCTs with
the European Community (3).

regions of

In its communication of 20 May 1999 entitled ‘the
Status of OCTs associated with the EC and options for
“OCT 2000”’, the Commission examined the features
and the development of the OCT-EC association since
1957, noted the basic principles and the current situa-
tion of the association and sketched out alternative poli-
cies for it for the period beginning 1 March 2000.

In accordance with Article 10 of Decision 91/482/EEC,
the competent OCT authorities informed the Commis-
sion of the amendments or additions they desired in
future, notably at a meeting held in the context of the
partnership on 29 and 30 April 1999, attended by the
Commission, the four Member States to which the OCTs
are linked and the 20 OCTs concerned.

Though not third countries, the OCTs do not form part
of the single market and must comply with the obliga-
tions imposed on third countries in respect of trade,
notably rules of origin, health and plant health standards
and safeguard measures.

As a general rule, when the Council adopts measures
under Article 187 of the Treaty, it must take account
both of the principles laid down in Part Four of the
Treaty and of the other principles of Community law. It
should also take account of experience acquired in the
implementation of the trade arrangements of Decision
91/482/EEC.

(1) OJ L 263, 19.9.1991, p. 1. Decision as last amended and extended

by Decision 2001/161/EC (OJ L 58, 28.2.2001, p. 21).

(2) PE 228.210, 1.12.1998.
(3) Not yet published C5-0070 - 2001/2033 (COS).

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(8)

(9)

These arrangements provide for duty-free access for
products originating in the OCTs and rules of origin
allowing cumulation with products originating in the
ACP States, which are subject to different arrangements,
or in the Community. This causes or threatens to cause
serious disruption to the functioning of certain common
market organisations under the common agricultural
policy,
in particular those for rice and sugar. Such
disruption has on a number of occasions led the
Commission and the Council to adopt safeguard meas-
ures.

By limiting the scope for use of cumulation of origin,
the changes made in relation to rice at the mid-term
review of the Decision (1) have helped maintain access
for OCT products to the Community market on terms
conducive to its balance. This access should be improved
in respect of the least developed OCTs, but without
modifying the overall quantity benefiting from cumula-
tion. Given that only two other OCTs have ever oper-
ated in this sector, the remaining available quantities
should be allocated to them, in the interest of transpar-
ency.

(10) However, as regards sugar and sugar mixes, the rise in
OCT exports made from sugar of ACP or Community
origin to a heavily oversupplied market has resulted in a
greater reduction in the quota allowed for Community
producers and therefore a greater loss of guaranteed
income for them.

(11) Moreover,

in view of

the minimal,

low value-added
operations that currently suffice to obtain the status of a
product originating in the OCTs in the sugar sector, the
contribution of these exports to the development of the
territories can only be small at best and, without a
doubt, out of all proportion to the disruption caused to
the Community sectors concerned.

(12)

For the above reasons, origin rules should therefore be
adopted which exclude the possibility of ACP/EC-OCT
cumulation for sugar when only minimal operations are
carried out. However, taking into account the invest-
ments already made in the OCTs on the basis of the
rules in force since 1991, such exclusion should enter
into force in a progressive way. Therefore, subject to the
adoption of
the necessary implementing provisions,
cumulation should be temporarily allowed to continue
within progressively decreasing quantitative limits which
are compatible with the objectives of the Community's
common market organisation for sugar whilst taking
due account of the legitimate interests of OCT operators.

(14)

(15)

(16)

(17)

duty-free into the Community by means of the cumula-
tion procedure.

the OCT rules of origin should be
Furthermore, all
updated, in the interests of the operators and administra-
tions concerned, to take account of technical progress
and the policy adopted by the Community of origin-rule
harmonisation. Likewise,
should be
simplified to enable the necessary technical amendments
to the rules to be made more easily in future.

the procedure

The procedure for the transhipment of goods not origin-
ating in the OCTs but in free circulation there should be
completed and clarified, with a view to ensuring a trans-
parent and reliable legal framework for operators and
administrations.
It should also be extended to cover
certain fishery products of particular importance for
Greenland and Saint-Pierre-et-Miquelon, subject to the
adoption of the necessary implementing provisions.

the Treaty and legislation
The general provisions of
derived thereunder do not automatically apply to the
OCTs, barring express provisions to the contrary. OCT
products imported into the Community must neverthe-
less comply with the Community rules in force.

Financial assistance to the OCTs should be allocated on
the basis of uniform, transparent and effective criteria,
taking into account the needs and performances of the
OCTs. Such criteria should include in particular the
economic and physical dimensions of the OCTs, the use
made of past allocations, respect for the principles of
sound financial management, fair fiscal policy, estimated
absorption capacity, the need for establishing a reserve
in order to finance non-programmable expenditure and
a smooth transition to prevent a sudden considerable
setback in allocation for New Caledonia, French Poly-
nesia and the Netherlands Antilles. In the interests of
efficiency, simplification and recognition of the manage-
ment capacities of the OCT authorities, the financial
resources granted to the OCTs should be managed more
on the basis of partnership by applying procedures
based on the rules in force for the structural funds.

(18)

for programming

the procedures delegate the main
For this purpose,
responsibility
and implementing
cooperation to the OCTs in particular. Cooperation will
be conducted predominantly in conformity with OCT
territorial regulations and will underpin support for the
monitoring, evaluation and audit of
the operations
programmed. In addition, it is necessary to clarify which
Community programmes and budget lines are open to
the OCTs, as well as the procedures for a smooth transi-
tion from previous EDFs to the 9th one.

(13)

Provision should also be made to ensure that agricultural
products originating in the Community and which have
benefited from an export refund cannot be re-imported

(1) Council Decision 97/803/EC of 29 November 1997 amending at
mid-term Decision 91/482/EEC on the association of the overseas
countries and territories with the European Economic Community
(OJ L 329, 29.11.1997, p. 50).

(19) Global changes, reflected in the continuing process of
trade liberalisation, broadly implicate the Community,
the OCTs' principal trading partner, as well as their ACP
neighbours and other economic partners. In the market
access equation, the level of tariffs plays an increasingly
reduced role while trade in services and trade-related

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areas assume an ever greater importance in the relation-
ship between the OCTs and their economic partners.
That relationship should therefore be fostered, while
retaining the broad outline of the current trade arrange-
ments, and the conditions for the gradual integration of
those OCTs who so wish into the regional and global
economy simplified by helping them to increase their
capacity to handle all these new areas.

(20)

The measures necessary for the implementation of this
Decision should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999, laying down
the procedures for the exercise of implementing powers
conferred on the Commission (1). However, so far as the
implementation of the 9th EDF is concerned, the voting
and the majority should be as laid down in Article 21 of
the Internal Agreement between the representatives of
the Governments of the Member States, meeting within
the Council, on the financing and administration of
Community Aid under the Financial Protocol to the
Partnership Agreement between the African, Caribbean
and Pacific States and the European Community and its
Member States signed in Cotonou (Benin) on 23 June
2000 and the allocation of financial assistance for the
Overseas Countries and Territories to which Part Four of

(21)

(22)

(23)

the Treaty applies (2), hereinafter the ‘Internal Agree-
ment’.

In respect of radioactive waste,

The OCTs are fragile island environments requiring
including in respect of waste
adequate protection,
this is
management.
provided under Article 198 of the Euratom Treaty and
legislation adopted thereunder, except for Greenland, to
which the Euratom Treaty does not apply. For other
waste, it should be specified which Community rules are
to apply in respect of the OCTs.

The arrangements for association laid down in this
Decision should not be applied to Bermuda in accord-
ance with the wishes of the Government of Bermuda.

The Council should produce an innovative response to
all
the above mentioned new factors which is both
consistent and tailored to the variety of situations. A
new status for the association can provide such a
response,

HAS DECIDED AS FOLLOWS:

GENERAL PROVISIONS OF THE ASSOCIATION OF THE OCTs WITH THE COMMUNITY

PART ONE

C h a p t e r 1

General provisions

Article 1

Purpose, objectives and principles

1.
The association of the OCTs with the Community, here-
inafter referred to as the ‘OCT-EC Association’, shall have as its
basis the purpose set out in Article 182 of the Treaty, namely
to promote the economic and social development of the OCTs
and to establish close economic relations between them and
the Community as a whole.

It shall pursue the objectives laid down in Article 183 of the
Treaty in accordance with the principles set out in Articles 184
to 188 of the Treaty by focusing on the reduction, prevention
and, eventually, eradication of poverty and on sustainable
development and gradual
integration into the regional and
world economies.

2.

The association relates to the OCTs listed in Annex I A.

In accordance with Article 188 of

3.
this
Decision shall apply to Greenland subject to the specific provi-
sions set out in the Protocol on the special arrangements for
Greenland annexed to the Treaty.

the Treaty,

Article 2

Basic elements

1.
The OCT-EC association shall be based on the principles
of liberty, democracy, respect for human rights and funda-
mental freedoms and the rule of law. These principles, on

which the Union is founded in accordance with Article 6 of the
Treaty on European Union, shall be common to the Member
States and the OCTs linked to them.

2.
There shall be no discrimination based on sex, racial or
ethnic origin, religion or belief, disability, age or sexual orienta-
tion in the areas of cooperation referred to in this Decision.

Article 3

The least-developed OCTs

1.
The Community shall accord special treatment to the
least-developed OCTs and to those unable to take advantage of
the regional cooperation and integration referred to in Article
16.

To respond to such difficulties, development

2.
finance
cooperation shall comprise, inter alia, special treatment when
determining the volume of financial resources and the condi-
tions attached thereto in order to enable the least-developed
OCTs to overcome structural and other obstacles to their devel-
opment. It shall pay special attention to improving the living
conditions of the poorest sections of the population in the
context of poverty alleviation.

3.
the
The OCTs considered the least developed for
purposes of this Decision are listed in Annex I B. This list shall
be amended by decision of the Council, acting unanimously on
a proposal from the Commission, where the economic situa-
tion of an OCT undergoes a significant and lasting change,
necessitating its inclusion in the category of least-developed
OCTs or where its inclusion in that category is no longer
warranted.

(1) OJ L 184, 7.7.1999, p. 23.

(2) OJ L 317, 15.12.2000, p. 355.

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C h a p t e r 2

Actors of cooperation in the OCTs

— decentralised cooperation in the context of responsibilities
delegated for the purpose of supporting local development
initiatives.

Article 4

Principles

C h a p t e r 3

Principles and Procedures of the OCT-EC Partnership

1. Within the framework of the partnership laid down in
Article 7, the OCT authorities shall assume primary responsi-
bility for the formulation of association and development strat-
egies and their
implementation through the preparation,
together with the Commission and the Member State to which
the OCT is linked, of Single Programming Documents (herein-
after referred to as SPDs) and cooperation programmes.

2.
The Community shall recognise that local public and
private actors play a key role in achieving the objectives laid
down in Article 183 of the Treaty.

3.
In implementing this Decision, the parties shall have as
their guiding principles transparency, subsidiarity and the need
for efficiency.

Article 5

The different actors involved

Actors of cooperation in the OCTs shall

1.
— the OCT authorities;
— the other regional and local authorities within the OCTs;
— civil society, social, business and trade union associations,
public service providers and local, national or international
non-governmental organisations (NGOs).

include:

The Member States to which the OCTs are linked shall inform
the Commission within three months of the entry into force of
this Decision of
the national, regional or local authorities
referred to in the various Articles of the Decision.

2.
The recognition of non-governmental actors shall depend
on their capacity to meet the needs of the local population,
their expertise and their having democratic and accountable
organisation and management.

3.
Non-governmental actors shall be identified by agreement
between the OCT authorities, the Commission and the Member
State to which the OCT is linked, taking into account the
subject concerned, their expertise and field of activity. The
process of identification shall be conducted in each OCT as
part of
the preparation of cooperation
programmes referred to in Article 4.

the process

for

Article 6

Responsibilities of the non-governmental actors

Article 7

Dialogue and Partnership

the way that

1. With the aim of enabling the OCT to take a full part in
the implementation of the OCT-EC association, with due regard
for
the Member States
the institutions of
concerned are organised, the association shall use a consulta-
tion procedure based on the provisions referred to below. It
shall deal with any issue arising in relations between the OCTs
and the Community.

A broad-based dialogue should enable the Community,
2.
all the OCTs and the Member States to which they are linked to
consult each other on the principles, detailed procedures and
results of the association.

An OCT-EU forum for dialogue, hereinafter referred to as the
‘OCT Forum’, shall meet annually to bring together OCT
authorities,
the Member States and the
Commission.

representatives of

There

shall be

3.
separate partnerships between the
Commission, the Member State to which the OCT is linked and
each OCT, represented by its authorities, to enable the objec-
tives and principles of this Decision, in particular those referred
to in Articles 4 and 19 to be put into practice. This trilateral
consultation shall hereinafter be referred to as the ‘partnership’.

Partnership working parties, acting in an advisory capacity,
shall be set up for each OCT. Their membership shall comprise
the abovementioned three partners. These working parties may
be convened at the request of the Commission, of a Member
State or of an OCT. At the request of one of the partners,
several partnership working parties may hold joint meetings to
consider subjects of common interest or the regional aspects of
the association.

4.
This consultation shall be conducted in full compliance
with the respective institutional, legal and financial powers of
each of the three partners.

The Commission shall chair the working parties and the OCT
Forum and provide their secretariat.

A representative of the European Investment Bank, hereinafter
referred to as the EIB, shall be present at meetings when
matters concerning it are on the agenda.

Non-governmental actors identified pursuant to Article 5(3)
may play a role in:
— information and consultation;
— the preparation and implementation of

cooperation

programmes;

The opinions of the working parties and the OCT Forum
5.
shall, where appropriate, be the subject of Commission deci-
sions, within the limits of its powers, or of proposals from the
Commission to the Council with a view to implementation of
new elements of the OCT-EC association or its amendment on
the basis of Article 187 of the Treaty.

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Article 8

ACP-EU Joint Parliamentary Assembly

The OCT authorities shall be informed of the agenda, resolu-
tions and recommendations of the ACP-EU Joint Parliamentary
Assembly.

Member States and the Commission shall support any request
by OCT authorities to participate as observers at the plenary
sessions of the ACP-EU Joint Parliamentary Assembly, subject
to the Assembly's own rules of procedure.

Article 9

Management

Day-to-day management of this Decision shall be conducted by
the Commission and the OCT authorities and, should the need
in
arise, by the Member State to which the OCT is linked,
accordance with the institutional, legal and financial powers of
each of the partners, notably as regards development finance
cooperation and cooperation in the area of trade and services.

PART TWO

THE AREAS OF OCT-EC COOPERATION

Article 10

Areas of cooperation

The Community shall contribute to cooperation in those areas
in the OCTs listed in this Title in accordance with the priorities
established in the development strategies for each OCT or,
where appropriate,

in the form of regional measures.

Article 11

Productive sectors

Cooperation shall support sectoral policies and strategies that
facilitate access to productive activities and resources, in partic-
ular:

(a) A g r i c u l t u r e : agricultural policy and institution building,
diversification, irrigation, seed multiplication, crop protec-
tion measures,
fertiliser production, equipment, agro-
processing, livestock and cattle breeding, animal husbandry,
extension and research; marketing; storage and transporta-
tion; food security; agricultural credit; land settlement and
technology
reform,
transfer,
infrastructure, other
support services.

land use and registration policy,
irrigation and drainage

(b) F o r e s t r y :

and

forestry policy

trees to conserve the environment

institution building,
in
including use of
erosion and desertification control; afforestation;
forest
management, including the rational utilisation and manage-
ment of timber exports;
issues relating to tropical rain-
forests; research and training.

(c) F i s h e r i e s :

fishing policy and institution building,

fish
stock protection and rational management of fish stocks;
fish farming and artisanal fisheries; fishery transport; cold
storage and fish marketing and preservation.

(d) R u r a l

and institution
building,
projects/
programmes; assistance and projects targeted at people,

d e v e l o p m e n t :
integrated

rural policy

development

rural

production and marketing in rural areas; rural infrastruc-
ture.

(e) I n d u s t r y : sectoral policy and institution building; craft
industries; agro-industries and other manufacturing sectors,
transport equipment industry; technological research and
development; quality control; development and expansion
of SMEs and micro-enterprises.

(f) M i n i n g : sectoral policy and institution building, techno-
logical research and development; small-scale mining, etc.

(g) E n e r g y : energy policy and institution building; power
generation (non-renewable and renewable); efficient use of
energy resources; energy research and training; encouraging
private sector
in power generation and
distribution.

involvement

(h) T r a n s p o r t :

transport policy and institution building;
transport by road, rail, air, sea or inland waterway and
storage facilities.

(i) C o m m u n i c a t i o n : communication policy and institution

building; telecommunications and media.

(j) W a t e r : water policy and institution building; protecting
water resources, waste management, water supplies in rural
and urban areas for domestic,
industrial or agricultural
purposes; storage, distribution and management of water
resources.

(k) B a n k i n g ,

f i n a n c e a n d b u s i n e s s s e r v i c e s : financial
sector policy and institution building, business services;
privatisation, equity participation and marketing; support
to trade, commerce and business associations (including
export promotion agencies); financial and banking institu-
tions.

(l) T e c h n o l o g y

a n d

d e v e l o p m e n t

a p p l i c a t i o n ,
r e s e a r c h : policy and institution building; concerted action
at local, national and/or regional level for the promotion of
science and technology activities and their application to
production and promotion of computer literacy in the
public and private sectors, scientific programmes and
equipment for research.

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Article 12

(k) support for OCT efforts to penetrate third country markets

more effectively;

Trade development

The Community shall implement measures for the devel-
1.
opment of trade at all stages up to final distribution of the
product.

The object is to ensure that the OCTs derive the maximum
benefit from the provisions of his Decision and may participate
under the most
favourable conditions in the Community,
domestic, sub-regional, regional and international markets by
diversifying the range and increasing the value and the volume
of OCT trade in goods and services.

(l) market

development measures

increasing
contacts and exchange of information between economic
operators in OCTs, ACP States, the Member States and in
third countries;

including

(m) support for OCTs in the application of modern marketing
techniques
and
production-oriented
programmes, in particular in areas such as rural develop-
ment and agriculture;

sectors

in

(n) the establishment and development of insurance and credit

institutions in the field of trade development.

2.
In addition to developing trade between the OCTs and
the Community, particular attention shall be given to opera-
tions designed to increase the OCTs' self-reliance and improve
regional cooperation in trade and services.

4.
Support for OCTs' participation in trade fairs, exhibitions
and trade missions shall be carried out only where such events
form an integral part of overall trade and market development
programmes.

3. Within the instruments provided for in this Decision and
in accordance with the provisions set out in relation thereto,
operations shall be undertaken at the request of the OCT
authorities, particularly in the following areas:

(a) support for the definition of appropriate macroeconomic

policies necessary for trade development;

(b) support for the creation or reform of appropriate legal and
the reform of

regulatory frameworks as well as for
administrative procedures;

(c) the establishment of coherent trade strategies;

(d) support for OCTs in developing their internal capacities,
information systems and awareness of the role and impor-
tance of trade in economic development;

(e) support

for strengthening the infrastructure related to
trade and in particular support for the OCTs' efforts to
develop and improve supportive service infrastructure,
in order to
including transport and storage facilities,
ensure their effective participation in the distribution of
goods and services and in order to enhance the flow of
exports from the OCTs;

(f) development of human resources and professional skills in
the field of
in the
processing, marketing, distribution and transport sectors
for the Community, regional and international markets;

trade and services,

in particular

(g) support to private sector development and, in particular,
identification and development,

to SMEs for product
market outlets and export-oriented joint ventures;

(h) support

for OCT actions aimed at encouraging and
attracting private investment and joint venture operations;

(i) the establishment, adaptation and strengthening of organ-
isations in the OCTs dealing with the development of trade
and services, particular attention being paid to the special
needs of organisations in the least-developed OCTs;

(j) support for OCTs aiming to improve the quality of their
products, adapt them to market requirements and diversify
their outlets;

5.
Participation of the least-developed OCTs in various trade
activities shall be encouraged by special provisions, inter alia,
the payment of travel expenses of personnel and costs of
transporting exhibits, on the occasion of their participation in
local, regional and third-country fairs, exhibitions or trade
missions,
including the cost of the temporary construction
and/or renting of exhibition booths and stalls. The least-devel-
oped OCTs shall be granted special aid to assist in the prepara-
tion and/or purchase of promotional materials.

Article 13

Trade in services

1.
The Community agrees to develop and finance infrastruc-
ture and human resources as regards trade in services in
accordance with the priorities established under the develop-
ment strategies for each OCT.

2.
The Community shall contribute to the development and
promotion of cost-effective and efficient maritime transport
services in the OCTs, by:

(a) promoting the efficient shipment of cargo at economically

and commercially meaningful rates;

(b) implementing good policies and competition rules;

(c) facilitating greater OCT participation in international ship-

ping services;

(d) encouraging regional programmes of maritime transport

and trade development;

(e) increasing local private sector involvement

in shipping

activities.

The Community and the OCTs undertake to promote shipping
safety, security of crews and the prevention of pollution.

3.
The Community shall step up cooperation with the OCTs
so as to ensure regular improvement and growth in air traffic.

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This shall

involve:

(a) examining all means of reforming and modernising the

OCT air transport industries;

(b) promoting their commercial viability and competitiveness;

(c) encouraging higher levels of private sector investment and
participation and a greater exchange of knowledge and
good business practice;

(c) information exchanges and possible technical assistance on
regulation, standardisation, conformity testing and certi-
fication of information and communications technologies
and the use of frequencies;

(d) dissemination of new information and communications
technologies and the development of new facilities, particu-
larly in relation to interconnection of networks and inter-
operability of applications;

(d) providing passengers and exporters in all OCTs with access

to global air transport networks.

(e) promotion and implementation of joint research in the
field of new technologies related to the information society;

4.
Safety must be ensured in the air transport sector and the
relevant international standards introduced and implemented.

(f) design and implementation of programmes and policies to
raise the awareness of the economic and social benefits
deriving from the information society.

To that end, the Community shall assist the OCTs in:

(a) implementing air navigation safety systems, including the
Communications, Navigation and Surveillance/Air Traffic
Management (CNS/ATM) system;

(b) implementing airport

security and strengthening the
capacity of civil aviation authorities to manage all aspects
of operational security placed under their control;

(c) developing infrastructures and human resources;

(d) ensuring that any measures taken in this field are based on
advice from the relevant international organisations and
that they will be effective and sustainable in the long term.

Proper attention must be paid to minimising the environ-
in particular by means of

impact of air transport,

5.
mental
appropriate environmental

impact studies.

6.
In many aspects of air transport, regional solutions may
offer scope for greater cost effectiveness and economies of
scale. To that end, the Community undertakes to support and
encourage actions on a regional

level where appropriate.

7.
Since telecommunication and active participation in the
information society are prerequisites for the successful integra-
tion of the OCTs into the world economy, the Community and
the OCTs
respective commitments under
existing multilateral agreements, in particular the World Trade
Organisation (WTO) Agreement on Basic Telecommunications.

reconfirm their

8.
The Community shall support the efforts of the OCTs to
increase their capacity in the field of trade in services. Coopera-
tion shall cover,

inter alia, the following areas:

(a) promoting consultations between competent telecommuni-
cations bodies in the OCTs and the Community with a
view to encouraging development of a competitive tele-
to
communications environment bringing rates closer
costs;

Cooperation shall,

9.
in particular, be directed towards
greater complementarity and harmonisation of communication
systems at local, national, regional,
inter-regional and inter-
national

level and their adaptation to new technologies.

10.
The Community shall support measures and operations
to develop and support sustainable tourism. These measures
shall be implemented at all levels, from the identification of the
tourist product to the marketing and promotion stage.

The aim shall be to support the efforts of the authorities of the
OCT to derive maximum benefit from local, regional and inter-
national tourism in view of tourism's impact on economic
development and to stimulate private financial flows from the
Community and other sources into the development of tourism
in the OCTs. Particular attention shall be given to the need to
integrate tourism into the social, cultural and economic life of
the people, as well as to respect for the environment.

Specific tourism development measures shall be aimed at the
definition, adaptation and development of appropriate policies
at local, regional, sub-regional and international levels. Tourism
development programmes and projects shall be based on these
policies on the basis of the following four components:

(a) human resource and institutional development,

inter alia:

— professional management development in specific skills
and continuous training at appropriate levels in the
private and public sectors to ensure adequate planning
and development;

— establishment and strengthening of tourism promotion

centres;

— education and training for specific segments of

the
population and public/private organisations active in
involved in
the tourism sector,
sectors that support tourism;

including personnel

(b) establishment of a dialogue on different aspects of the
including regulatory aspects and

information society,
communications policy;

— inter-OCT and OCT-ACP cooperation and exchanges in
the fields of training, technical assistance and the devel-
opment of institutions.

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(b) the development of products including,

inter alia:

— identification of the tourism product, development of
non-traditional and new tourism products, adaptation
of existing products including the preservation and
development of cultural heritage, ecological and envir-
onmental aspects, management, protection and conser-
vation of flora and fauna, historical, social and other
natural assets, development of ancillary services;

— promotion of private investment in the OCTs' tourist

industries,

including the creation of joint ventures;

— production of crafts of a cultural nature for the tourist

market.

(c) market development including,

inter alia:

— assistance for the definition and execution of objectives
and market development plans at local, sub-regional,
regional and international

levels;

— support for the OCTs' efforts to gain access to services
for the tourist
industry such as central reservation
systems and air traffic control and security systems;

— marketing and promotional measures and materials in
the framework of integrated market development plans
and programmes with a view to improved market pene-
tration, aimed at the main generators of tourism flows
in traditional and non-traditional markets as well as
specific activities such as participation at specialised
trade events, such as fairs, production of quality litera-
ture, films and marketing aids;

(d) research and information including,

inter alia:

— improving

collecting,
analysing, disseminating and utilising statistical data;

tourism information

and

— assessment of the socio-economic impact of tourism on
the economies of the OCT with particular emphasis on
the development of linkages to other sectors in the
OCT and the surrounding regions, such as food produc-
tion, construction, technology and management.

Article 14

Trade-related areas

the competition rules by both private and state enterprises.
Cooperation in this area shall, in particular, include assistance
in the drafting of an appropriate legal
framework and its
administrative enforcement with particular reference to the
least developed OCTs.

4.
The Community shall continue to foster cooperation with
the OCTs and extend it, in particular, to the following areas:

(a) the preparation of laws and regulations for the protection
and enforcement of intellectual property rights, the preven-
tion of the abuse of such rights by rightholders and the
infringement of such rights by competitors, the establish-
ment and reinforcement of local, national and regional
offices and other agencies including support for regional
intellectual property organisations involved in enforcement
and protection,

including the training of personnel;

(b) the conclusion of agreements aimed at protecting trade-
marks and geographical indications for products of partic-
ular interest.

5.
The Community shall assist the OCTs in their efforts with
regard to standardisation and certification aimed at promoting
compatible systems between the Community and the OCTs.
Cooperation shall comprise the following in particular:

(a) measures to promote greater use of international technical
regulations, standards and conformity assessment proced-
ures, including sector-specific measures, in accordance with
the level of economic development of the OCTs;

(b) cooperation in the area of quality management and assur-
ance in selected sectors of importance to the OCTs;

(c) support for OCT capacity building initiatives in the fields of
conformity assessment, metrology and standardisation;

(d) developing links between OCT and European standardisa-
tion, conformity assessment and certification institutions.

The Community shall help strengthen cooperation with
6.
the OCTs with regard to human, animal and plant health
measures with a view to building public and private sector
capacity in this area.

1.
The Community shall help reinforce, within the develop-
ment strategies of each OCT, the capacity of the OCTs to
handle all areas related to trade,
including where necessary
improving and supporting the institutional framework.

7.
Bearing in mind the Rio Principles and with a view to
reinforcing the mutual supportiveness of trade and environ-
ment policies, the Community shall enhance cooperation with
the OCTs. The aim of cooperation shall in particular be to:

The Community shall cooperate with the OCTs in the
the general principles on protection and

2.
introduction of
promotion of investments.

(a) establish coherent local, national, regional and international

policies;

3.
The Community shall also help to reinforce cooperation
with the OCTs with a view to formulating and supporting
effective competition policies with the appropriate competition
agencies that progressively ensure the efficient enforcement of

(b) reinforce quality controls of goods and services related to

the environment;

(c) improve environment-friendly production methods in rele-

vant sectors.

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The Community shall cooperate with the OCTs in rela-
8.
tion to labour standards. Cooperation in this area shall mainly
consist of:

(f) develop the use of communications and information tech-
including distance

nology in the field of education,
learning;

(a) exchanges of information on respective labour laws and

(g) increase electronic commerce and economic cooperation;

regulations;

(b) assistance in the formulation of

labour legislation and

strengthening of existing legislation;

(c) educational and awareness-raising programmes aimed at

eliminating child labour;

(d) enforcement of labour legislation and regulations.

9.
The Community shall cooperate with the OCTs in the
area of consumer policy and consumer health protection by:

(a) improving institutional and technical capacity in this area;

(b) establishing rapid-alert systems of mutual information on

dangerous products;

(c) exchanging information and experiences on the establish-
ment and operation of post-market surveillance of products
and product safety;

(d) improving information provided to consumers on prices,

characteristics of products and services offered;

(e) encouraging the development of private consumer associa-
tions and contacts between consumer-interest representa-
tives;

(f) improving compatibility of consumer policies and systems;

(g) informing on the entry into force of

legislation and
promoting cooperation in investigating harmful or unfair
business practices;

(h) implementing exports prohibitions on the trade of goods
and services the marketing of which has been prohibited in
their country of production.

The Community shall support the efforts deployed by
10.
the OCT public and private actors in the field of information
technology and telecommunications to:

(a) modernise telecommunications infrastructure, data trans-
mission services, remote processing applications and tele-
matics application projects (TAP);

(b) develop and improve the services and the human capacity
needed for achieving the information society, and integrate
those services in the best possible way in a regional
context;

(c) improve

awareness of

economic opportunities

and

exchanges of experience and of know-how;

(d) provide better information to the users of those resources;

(e) exploit the potential of this sector in an optimum and

sustainable manner;

(h) improve and modernise health networks,

through the
development of links between hospitals, the use of remote
diagnosis and the creation of joint databases;

(i) develop multimedia access to cultural and tourist resources;

(j) improve and increase the use of information and commu-
nications technology in industry and for innovation.

Article 15

Social sectors

The Community shall contribute, within the development strat-
egies of each OCT, to human and social development meas-
ures. Cooperation could in particular support programmes in
the following sectors:

(a) Education policy and institution building (buildings and
language and teacher training; primary educa-
materials);
tion; secondary education and vocational training; higher
education (including sector-specific education activities, e.g.
agricultural training).

In education, the focus should be on widening access to
and improving
education by
the quality of basic
constructing more schools, rehabilitating existing class-
rooms
teacher
training, and bursaries for poor students;

educational materials,

and providing

(b) Health sector reform activities, health policy and institution
building; medical education, training and research, health
infrastructure; HIV/AIDS.

In the health sector, projects should help to provide
primary and preventive care services, particularly family
planning and child and maternal health services;

(c) Population policy and family planning; mother and child
care, including support for projects on the nurturing and
development of the next generation.

(d) Increasing the efficiency of policies to prevent the produc-
tion, distribution and trafficking of all kinds of drugs,
narcotics and psychotropic substances, preventing and
reducing drug abuse, taking into account work done in this
context by international bodies.

Cooperation shall comprise the following:

(i) training, education, health promotion and rehabilita-
tion of addicts, including projects for the reintegration
of addicts into work and social environments;

for example programmes for

(ii) measures to encourage alternative economic opportun-
ities,
the alternative
development of areas used for the illicit production of
narcotic plants, linked to effective enforcement meas-
ures;

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(iii) technical,

and

financial

administrative

assistance
relating to the monitoring of precursors trade, and the
establishment of standards equivalent to those adopted
by the Community and international
authorities
concerned;

(iv) technical,

financial

assistance
relating to the prevention, treatment and reduction of
drug abuse;

administrative

and

(v) technical assistance and training, and the establishment
of standards to prevent money laundering equivalent
to those adopted by the Community and other inter-
national bodies, in particular the Financial Action Task
Force on Money Laudering;

(vi) exchange of relevant information for the implementa-

tion of points (a) to (d).

(e) Water policy and institution building; water

resources
protection; waste management (water for agriculture or
energy will be covered under the relevant sector).

In the water supply and sanitation sector, the aim shall be
to provide services in under-served areas. Funding that
supports increasing access to drinking water supply and
sanitation services contributes directly to human resources
development by improving the state of health, and thus
increasing the productivity, of people who do not already
have access to these services; the continuing need to extend
basic services in water, sanitation, and transport to both
urban and rural populations must be addressed in environ-
mentally sustainable ways.

(f) The Community shall cooperate with the OCTs in the
conservation, sustainable use and management of
their
biological diversity taking into account the Community
Action Plan on biological diversity.

Cooperation in this area may,

in particular, extend to:

(i) supporting the elaboration, updating and implementa-
tion of national biodiversity strategies and action plans;

(ii) facilitating the establishment of local, regional and sub-
regional mechanisms for the exchange of information
and the monitoring and assessment of progress in the
implementation of the Convention on Biological Diver-
sity (CBD) (1);

(iii) developing and maintaining up-to-date databases on

OCT biological diversitys;

(iv) implementing appropriate measures relating to the

access to genetic resources;

(v) promoting the conclusion of agreements with the
private sector for the use of
the country's genetic
resources, so that local communities may effectively
benefit from the economic revenue derived from such
agreements and so that the use of genetic resources
does not harm the protection and conservation of the
biodiversity;

(vi) assisting the OCTs to participate actively in the policy-
making process and negotiations under the CBD.

(g) Housing and integrated urban development projects and

programmes.

In urban development, efforts shall focus on building or
rehabilitating roads and other basic infrastructure, including
low-income housing.

Article 16

Regional cooperation and integration

Cooperation shall ensure that effective aid is provided in order
to achieve the objectives and priorities established by the
competent OCT authorities in the framework of regional and
sub-regional cooperation and integration:

1. Regional cooperation shall cover operations agreed on

between:

(a) two or more OCTs;

(b) one or more OCTs and one or more neighbouring ACP

or non-ACP States;

(c) one or more OCTs and one or more ACP States or one
or more of the most remote regions referred to in
Article 299(2) of
the Treaty (Guadeloupe, Guyana,
Martinique, Réunion, the Canary Islands, Azores and
Madeira);

(d) two or more regional bodies of which OCTs are

members;

(e) one or more OCTs and regional bodies of which OCTs,
ACP States or one or more of the most remote regions
are members.

2. The objectives of cooperation in this context shall be to:

(a) foster the gradual
world economy;

integration of

the OCTs into the

(b) accelerate

economic

cooperation and development
within the regions of the OCT and between them and
the regions of the ACP States;

(c) promote the free movement of persons, goods, services,

capital,

labour and technology;

(d) accelerate economic diversification and the coordination
sub-regional

regional

and

and harmonisation of
cooperation policies;

(e) promote and foster inter-OCT and intra-OCT trade as
well as trade with the most remote regions, ACP States
or other third countries.

3. In the context of regional integration, the aim of coopera-

tion shall be to:

(a) build and enhance the capacity of regional cooperation
to

and integration organisations
promote regional cooperation and integration;

and institutions

(1) Council Decision 93/626/ΕEC of 25 October 1993 concerning the
the convention on Biological Diversity (OJ L 309,

conclusion of
13.12.1993, p. 1).

(b) encourage the least developed OCTs to take part in the
development of regional markets and benefit therefrom;

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(c) implement sectoral reform policies at regional

level;

Article 17

(d) liberalise trade and payments;

(e) stimulate cross-border foreign and domestic investment
and other regional or sub-regional economic integration
initiatives;

(f) take account of the net transitional cost of regional
integration on budget revenue and balance of payments.

4. Cooperation shall, in the area of regional cooperation, cover
a wide variety of
functional and thematic fields which
specifically address common problems and take advantage
including:
of economies of scale,

(a) infrastructure, particularly transport and communica-
tions infrastructure and related safety problems, energy;

(b) the environment, water resource management;

(c) health, education and training;

(d) research and scientific and technical cooperation;

(e) regional disaster preparedness and alleviation initiatives;

(f) other areas, e.g. arms controls, drugs, organised crime,

money laundering, fraud and corruption.

5. Cooperation shall also support inter-regional, inter-OCT and

inter-ACP cooperation schemes and initiatives.

Cultural and social cooperation

Cooperation shall contribute to the self-reliant development of
the OCTs, this being a process centred on people themselves
and rooted in each people's culture. The human and cultural
dimension shall embrace all areas and be reflected in all devel-
opment projects and programmes. Cooperation shall back up
the policies and measures adopted by the competent OCT
authorities to enhance their human resources,
increase their
own creative capacities and promote their cultural identities. It
shall foster participation by the population in the process of
development.

Cultural and social cooperation shall be expressed through:

— the taking into account of the cultural and social dimen-

sion;

— promotion of cultural identities and intercultural dialogue,
with particular reference to preserving the cultural heritage,
the production and dissemination of cultural products,
cultural events and information and communication;

— operations to enhance human resources, notably covering
education and training, scientific and technical cooperation,
the role of women in development, health and combating
drug abuse, population and demography.

PART THREE

INSTRUMENTS OF OCT-EC COOPERATION

TITLE I

DEVELOPMENT FINANCE COOPERATION

(d) contribute to the fullest participation of the population in
the benefits of development in the interests of alleviating
poverty;

C h a p t e r 1

General provisions

Article 18

Objectives

(e) contribute to the development of the capacity of the OCTs
to innovate, adapt and transform local technologies and to
master appropriate new technologies;

(f) support

the efforts of

the OCTs to achieve economic
inter alia by contributing to sustainable
diversification,
exploration, conservation, processing and exploitation of
their natural resources;

The objective of development finance cooperation shall be,
through the provision of adequate financial resources and
appropriate technical assistance, to:

(a) support and promote the OCTs' own efforts to achieve
sustainable social, cultural and economic development on
the basis of mutual interest and in a spirit of interdepen-
dence;

(b) help raise the standard of living of the peoples of the

OCTs;

(c) promote measures likely to mobilise the capacity for initia-
tive of communities, groups, associations and individuals
and their participation in the design and implementation
of development programmes;

(g) provide support for and promote the optimal development

of human resources in the OCTs;

(h) facilitate an increase in the financial flows to the OCTs
that meet their evolving needs and support the efforts of
the OCTs to harmonise international cooperation for their
development through cofinancing of operations with other
financing agencies or third parties;

(i) promote direct private investment in the OCTs, support
the development of a healthy, prosperous and dynamic
OCT private sector and encourage local, national and
foreign private investment
into the productive
sectors in the OCTs;

flows

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(j) encourage inter-OCT and OCT-ACP regional cooperation,

solidarity and integration;

in partnership, shall lay down the strategy and the priority aims
on which the SPD is to be based.

(k) permit the establishment of more balanced economic and
social relations and better understanding between the
OCTs, ACP States, Member States and the rest of the
world, with a view to assisting the integration of the OCTs
into the world economy;

(l) enable OCTs faced with serious economic and social diffi-
culties of an exceptional nature resulting from natural
disasters or extraordinary circumstances having compar-
able effects to benefit from emergency assistance;

(m) help the least-developed OCTs to overcome the specific
obstacles which hamper their development efforts.

Article 19

Principles

Development finance cooperation shall be based on part-

1.
nership, complementarity and subsidiarity and shall:

(a) be implemented,

in accordance with the association and
development strategies adopted pursuant to Article 4, with
due regard to the OCTs respective geographical, social and
cultural characteristics, as well as their specific potential;

2.

The OCT authorities shall be responsible for:

(a) establishing their priorities on which the cooperation

strategy should be based;

(b) in the framework of sectoral planning, identifying projects
and programmes and establishing back-up measures to
ensure the sustainability and viability of
the proposed
schemes;

(c) preparing project and programme dossiers;

(d) preparing, negotiating and concluding contracts;

(e) implementing and managing projects and programmes;

(f) maintaining projects and programmes and ensuring their

sustainability.

The relevant authorities of the OCTs and the Commission

3.
shall be jointly responsible for:

(a) adopting the SPD;

(b) ensuring equality of conditions for participation in invita-

tions to tender and contracts;

(b) ensure that resource flows are accorded on a predictable

and regular basis;

(c) monitoring and evaluating the effects and results of

projects and programmes;

(c) be flexible and tailored to the situation in each OCT.

(d) ensuring the proper, prompt and efficient execution of

projects and programmes.

2. Member States shall cooperate with the Commission to
ensure sound financial management in the use of Community
funds.

3.
Following a partnership approach, Community activities
shall be decided in close consultation between the Commission,
the OCT authorities concerned and the Member State to which
it is linked. Such partnership shall be conducted in full compli-
ance with the respective institutional,
legal and financial
powers of each of the partners.

4. Without prejudice to the second subparagraph of Article
25(1), Community and Member States contributions shall be
complementary.

In accordance with the principle of subsidiarity,

the
5.
authorities of
the OCT concerned shall be responsible for
implementing operations without prejudice to the powers of
the Commission designed to ensure sound financial manage-
ment in the use of Community funds.

The Commission shall be responsible for taking the
4.
financing decision on the overall allocation corresponding to
the SPD,
in accordance with the procedure referred to in
Article 24.

Unless otherwise provided in this Decision, all decisions
5.
requiring the approval of a party to the association shall be
approved, or be deemed approved, within six months of noti-
fication by the other party.

Article 21

Scope of financing

Within the framework of the strategy and priorities established
by the OCT concerned at local or regional
financial
support may be given to operations helping to achieve the
objectives set out in this Decision.

level,

Article 20

The following activities shall fall within its scope:

Single Programming Documents

(a) sectoral policies and reforms as well as projects that are in

coherence with them;

1.
Pursuant to Article 4, the OCT authorities, the Commis-
sion and the Member State to which the OCT is linked, acting

(b) institutional development, capacity building and integration

of environmental aspects;

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(c) technical cooperation programmes;

(d) humanitarian aid and emergency relief operations;

(e) additional support in the event of fluctuations in export

earnings from exports of goods and services.

(b) the procedures and criteria for the follow-up, audit, ex-ante,
mid-term and ex-post evaluation, review and implementa-
tion of the SPD, including those in relation to the Commis-
sion's participation in these activities;

(c) the preparation of periodical or other reports;

(d) detailed rules for the financial corrections referred to in

Article 22

Article 32.

Eligibility for financing

The financial and accounting procedures shall be laid down in
the 9th EDF Financial Regulation.

The following entities or bodies shall be eligible for finan-

1.
cial support provided under this Decision:

(a) OCTs;

(b) regional or inter-State bodies to which one or more OCTs
belong and which are authorised by their relevant authori-
ties;

(c) joint bodies set up by the Community and the OCTs to

pursue certain specific objectives.

Subject

2.
concerned, the following shall also be eligible for support:

the authorities of OCTs

to the agreement of

(a) local, national and/or regional public or semi-public agen-
cies, departments or local authorities of the OCTs and in
institutions and development
particular
banks;

financial

their

(b) companies and firms of the OCTs and of regional groups;

(c) enterprises of a Member State, so as to enable them, in
addition to their own contribution, to undertake productive
projects in the territory of an OCT;

(d) OCT or Community financial

intermediaries promoting

and financing private investments in the OCTs;

(e) actors of decentralised cooperation and other non-State
actors from OCTs and from the Community, to enable
them to undertake economic, cultural, social and educa-
tional projects and programmes in the OCTs in the frame-
work of decentralised cooperation, as referred to in Article
29.

Article 23

Programming and implementation

The Commission shall adopt the implementing provisions for
this Part of the Decision and for Annexes II A to D within 12
months of its entry into force, in accordance with the proce-
dure laid down in Article 24 and in cooperation with the OCTs
in accordance with Article 7.

It shall support the full utilisation by the OCTs of the instru-
ments laid down in this Decision, in particular the trade and
financial provisions, by providing the relevant guidelines and
information within 12 months of its entry into force.

The provisions shall

include in particular:

(a) the procedure for preparing the SPD and its essential

elements;

Article 24

The EDF-OCT Committee

The Commission shall, where appropriate, be assisted by
1.
the Committee created by the Internal Agreement, hereinafter
referred to in this Article as ‘the Committee’.

2. When exercising the powers conferred on it by this
Decision, the Committee shall be known as the ‘EDF-OCT
Committee’. The internal rules of procedure of the Committee
created by the Internal Agreement shall apply to the EDF-OCT
Committee.

3.
The Committee shall focus its work on the substantive
issues of development cooperation at OCT and regional level.
In the interests of coherence, coordination and complemen-
tarity,

it shall monitor the implementation of the SPDs.

4.

The Committee shall give its opinion on:

(a) draft SPDs and any amendments to them;

(b) the implementing provisions for this Part of the Decision

and for Annexes II A to D.

The representative of the Commission shall submit to the
5.
Committee a draft of the measures to be taken. The Committee
shall deliver its opinion on the draft within a time limit laid
down by the chairman. The opinion shall be delivered by the
majority laid down in Article 21(4) of the Internal Agreement.
The votes of the representatives of the Member States within
the Committee shall be weighted in the manner set out in
paragraph 3 of that Article. The chairman shall not vote.

The Commission shall adopt the measures, which shall
6.
apply immediately. However, if the measures are not in accord-
ance with the opinion of the Committee they shall be commu-
nicated by the Commission to the Council forthwith. In that
event, the Commission may defer application of the measures
which it has decided on for a period of not more than three
months from the date of such communication.

7.
The Council, acting by the majority and in accordance
with the weighting referred to in paragraph 5, may take a
different decision within the period provided for in paragraph
6.

The Commission shall

8.
follow-up, evaluation and audit of SPDs.

inform the Committee of

the

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C h a p t e r 2

Resources made available to the OCTs

Article 25

Financial assistance

The overall amount of Community financial assistance
1.
for the purposes of Chapter 1, its allocation, financing terms
and arrangements and of the use of the assistance for the
period from 2000 to 2007 can be found in Annexes II A to D
and in Chapter 3, without prejudice to the provisions to be
adopted by the Commission as laid down in Article 24.

(g) promote the development of enterprises by taking such
steps as are necessary to improve the business environment
and, in particular, foster a legal, administrative and incen-
tive framework which is conducive to the emergence and
development of
enterprises
dynamic private
including grassroots operations;

sector

(h) strengthen the capacity of local institutions in the OCTs to
provide the range of services which can encourage greater
local participation in industrial and business activity.

Article 27

Investment support and financing

Financial assistance under this Decision may be used to cover
the total cost of both the local and foreign expenditure of
projects and programmes,
including financing of recurrent
costs.

Cooperation will provide long-term financing to help promote
private sector growth and mobilise national and foreign capital
to that effect. To this end, cooperation shall
in particular
provide:

2.
OCTs are also eligible for financing under the legislation
in force in favour of the developing countries listed in Annex II
E and for the Community programmes listed in Annex II F.

C h a p t e r 3

Private Sector Investment Support

Article 26

Investment promotion

authorities of

the OCT, Member States

The
and the
Community, recognising the importance of private investment
their development cooperation and
in the promotion of
acknowledging the need to take steps to promote such invest-
ment, shall:

(a) implement measures to encourage participation in their
development efforts by private investors who comply with
the objectives and priorities of OCT-EC development
cooperation and with the appropriate laws and regulations;

(b) accord fair and equitable treatment to such investors;

(c) take measures and actions which help to create and main-
tain a predictable and secure investment climate as well as
enter into negotiations on agreements which will improve
such a climate;

(d) promote effective cooperation among OCT economic oper-
ators and between them and those of the Community in
order to increase the flow of capital, management skills,
technology and other forms of know-how;

(e) seek to promote a greater

flow of private resources
between the Community and the OCTs by contributing,
inter alia, to the removal of obstacles which impede OCT
operators' access to international capital markets, including
those of the Community;

(f) create an environment which encourages the development
of financial institutions and the mobilisation of resources
which are essential to capital formation and the growth of
entrepreneurship;

(a) grants to cover technical and financial assistance in support
of human resource development,
institutional capacity
building, or other forms of institutional aid linked to a
specific investment; measures designed to make enterprises
more competitive and build the capacity of private financial
and non-financial intermediaries; measures to facilitate and
promote investment and activities to improve competitive-
ness;

(b) advisory and consultancy services to help create an invest-
ment-friendly climate and a stock of information to help
guide and encourage capital flows;

(c) grants funded by the Investment Facility referred to in

Annex II C;

(d) loans from the EIB's own resources.

The conditions applicable to the Investment Facility and the
abovementioned loans are laid down respectively in Annexes II
B and C.

C h a p t e r 4

Additional support in the event of fluctuations in export
earnings

Article 28

Additional support

1.
In order to mitigate the adverse effects of any short-term
fluctuations in export earnings, in particular in the agricultural
and mining sectors, which might jeopardise the attainment of
the development objectives of the OCT concerned, a system of
additional support shall be instituted within the financial allo-
cation referred to in Annex II A.

The purpose of support in the event of short-term fluctu-
2.
ations in export earnings is to safeguard macroeconomic and
sectoral reforms and policies that are at risk as a result of a
drop in revenue and remedy the adverse effects of instability of
export earnings in particular from agricultural and mining
products.

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The dependence of the OCT economies on exports, in
3.
particular in the agricultural and mining sectors, shall be taken
into account in the allocation of resources referred to in Annex
II D. In this context, the least developed OCTs shall receive
more favourable treatment.

4.
The additional resources shall be provided in accordance
with the specific modalities of the support mechanism as set
out in Annex II D.

5.
The Community shall also provide support for market-
based insurance schemes designed for OCTs seeking to protect
themselves against the risk of fluctuations in export earnings.

C h a p t e r 5

Support for other actors of cooperation

Article 29

Objectives and financing

1.
In order to respond to the development needs of local
communities and encourage all actors of decentralised coopera-
tion which are in a position to contribute to the autonomous
development of the OCTs to put forward and implement initia-
tives, OCT-EC cooperation shall support such development
operations within limits laid down by the OCTs concerned and
by the Member States to which these OCTs are linked, and
within the framework of the SPD provisions.

the results of initiatives by local communities or decentralised
actors.

The support provided for under this Chapter shall be
if need be, complementary in respect of the

4.
additional or,
provisions in Annex II E.

5.
Contributions to the funding of microprojects and decen-
tralised cooperation shall come from grants, in which case the
contribution shall not normally exceed three-quarters of the
total cost of each project. The balance shall be financed:

(a) for microprojects, by the local community concerned, in
kind or in the form of services or cash and adapted to its
capacity to contribute;

(b) for decentralised cooperation, by the actors of decentralised
cooperation, provided that the financial, technical, material
and other resources brought in by such actors is not, as a
general rule, less than 25 % of the estimated cost of the
project/programme;

(c) in exceptional cases where both microprojects and decen-
tralised cooperation are concerned, by the authorities of the
OCT concerned, either in the form of financial contribution
or through the use of public equipment or the supply of
services.

applicable

The procedures
and programmes
financed in the context of microprojects or decentralised
cooperation shall be as set out in this Decision, notably with
regard to the SPD implementing provisions.

to projects

C h a p t e r 6

In this context, financial support shall be given to decen-

2.
tralised projects and microprojects as follows:

Support for humanitarian and emergency aid

this Chapter

(a) The cooperation partners eligible for financial support
shall be decentralised cooperation
under
agents in the Community or the OCTs or other developing
countries, namely:
local authorities, non-governmental
organisations, local traders' associations and local citizens'
groups, cooperatives, trade unions, women's and youth
organisations, teaching and research institutions, churches
and any non-governmental associations likely to contribute
do development.

This form of cooperation shall make available for the devel-
opment of the OCTs the capabilities, innovative operating
methods and resources of
the actors of decentralised
cooperation. Support will take account in particular joint
actions between Community, OCT and other developing
countries;

(b) Local microprojects shall have an economic and social
impact on the life of the people, meet a demonstrated and
observed priority need and be undertaken at the initiative
and with the active participation of the local community
which will benefit therefrom.

3.
Projects or programmes under this form of cooperation
may be a way of achieving the specific objectives of the SPD or

Article 30

Objectives and means

Humanitarian and emergency aid shall be granted to
1.
OCTs faced with serious economic and social difficulties of an
exceptional nature resulting from natural disasters or extraor-
dinary circumstances having comparable effects. Humanitarian
and emergency aid shall be maintained as long as necessary to
deal with the urgent problems which arise in such situations.

Humanitarian and emergency aid shall be granted solely on the
basis of the needs and interests of disaster victims.

2.

The aim of humanitarian and emergency aid shall be to:

(a) save human lives in crisis and post-crisis situations caused
by natural disasters or extraordinary circumstances having
comparable effects;

(b) help finance the transport of aid and efforts to ensure that
it is accessible to those for whom it is intended, by all
logistical means available;

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(c) implement short-term rehabilitation and reconstruction
measures in order to establish conditions as soon as
possible for the people concerned to be integrated or rein-
tegrated;

(d) respond to needs arising as a result of people being
displaced, such as refugees, displaced persons and returnees
following natural or man-made disasters so as to meet all
the requirements of refugees and displaced persons wher-
ever they may be for as long as is necessary and facilitate
their voluntary resettlement;

(e) help the OCTs to develop or perfect systems of disaster
prevention and preparedness,
including prediction and
early-warning systems, with a view to reducing the
consequences of disasters.

Article 32

Financial control

The OCT concerned shall bear primary responsibility for
1.
the financial supervision of the operation. This shall be carried
out, where appropriate, in coordination with the Member State
to which the OCT is linked in accordance with the applicable
national

legislation.

2.

The Commission shall be responsible for:

(a) ensuring that management and control systems exist and
function properly in the OCT concerned so as to ensure
that the Community funds are used correctly and effec-
tively;

3.
Similarly aid may be granted to OCTs taking in refugees
or returnees to meet acute needs not covered by emergency
assistance.

(b) in the event of irregularities, sending recommendations or
requests for corrective measures to remedy those irregulari-
ties and rectify any management shortcomings found.

Aid provided for by this Article shall be financed from
4.
it may exceptionally be
the Community budget. However,
financed from the allocations laid down in Annex II A,
in
addition to the funding from the budget heading concerned.

Humanitarian and emergency aid operations shall be
5.
undertaken at the request of the OCT affected, the Commis-
sion, the Member State to which the OCT is linked,
inter-
national organisations or local or international non-govern-
mental organisations. Such aid shall be administered and
implemented under procedures that facilitate rapid, flexible and
effective operations.

C h a p t e r 7

Implementation Procedures

Article 31

Technical assistance

1.
On the initiative of or on behalf of the Commission,
studies or technical assistance measures may be financed in
order to ensure the preparation, monitoring, evaluation and
supervision necessary for implementing this Decision.

Such studies or technical assistance measures shall be financed
by the overall grant allocation.

2.
On the initiative of the OCT, studies or technical assis-
tance measures may be financed in relation to the implementa-
tion of the activities contained in the SPD, subject to the
Commission's opinion.

Such studies or technical assistance measures shall be financed
from the allocation of the OCT concerned.

3.
the
The Commission, OCT and, where appropriate,
Member State to which it is linked, shall cooperate on the basis
of administrative arrangements at annual or biannual meeting
to coordinate programmes, methodologies and the imple-
mentation of controls.

4. With regard to financial corrections:

(a) the OCT shall be responsible in the first

instance for

detecting and correcting financial

irregularities;

(b) however,

in the event of

shortcomings by the OCT
concerned, the Commission shall take action, if the OCT
fails to remedy the situation and attempts at conciliation
are unsuccessful, to reduce or withdraw the balance of the
overall allocation corresponding to the SPD financing
decision.

C h a p t e r 8

Transition from previous European Development Funds
(EDFs) to the 9th EDF

Article 33

Implementing the previous EDFs and the transitional
phase

1.
Commitments made in the framework of the 6th, 7th
and 8th EDFs before the entry into force of this Decision shall
continue to be executed following the rules applicable to those
EDFs.

Resources from the sixth, seventh and eighth EDFs which were
allocated to OCTs before the entry into force of this Decision
shall remain allocated to them. These resources shall continue
to be used in accordance with the relevant provisions of
Decision 91/482/EEC, which shall remain applicable for such
purposes, until the entry into force of the Internal Agreement
establishing the 9th EDF.

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Until the Internal Agreement establishing the 9th EDF comes
into force, the officials responsible for managing and imple-
menting European Development Fund resources, namely the
EDF Chief Authorising Officer, the OCT Local Authorising
Officer and the Commission's Head of Delegation, shall remain
responsible for the management and implementation tasks
assigned to them by Council Decision 91/482/EC.

2.
Any balances remaining from previous EDFs on the date
of entry into force of the Internal Agreement establishing the
9th EDF, as well as any amounts that shall be decommitted at a
later date from ongoing projects under these Funds, shall be
transferred to the 9th EDF and used in accordance with the
conditions laid down in this Decision.

Any resources thus transferred to the 9th EDF that previously
had been allocated to the indicative programme of an OCT or
region shall remain allocated to that OCT or to regional
cooperation.

Any other remaining balances not allocated to an indicative
programme shall be transferred to the non-committed amount
of the 9th EDF. The overall amount of this Decision, supple-
mented by the transferred balances from previous EDFs, shall
cover the period 2000–2007. This paragraph shall apply in
particular to any remaining balances of the overall amounts
referred to in Articles 118 and 142 of Decision 91/482/EEC
concerning, respectively, the stabilisation of export earnings
from agricultural
special
financing facility (Sysmin).

commodities

and the

(Stabex)

TITLE II

ECONOMIC AND TRADE COOPERATION

Article 34

Objective

1.
The objective of economic and trade cooperation shall be
to promote the economic and social development of the OCTs,
in particular by establishing close economic relations between
them and the Community as a whole.

The implementation of such cooperation must be consistent
with the objectives of the other common policies.

Furthermore, the Community undertakes to support the
2.
effective integration of the OCTs in the global economy and
the development of
their trade in goods and services to
regional and world markets.

C h a p t e r 1

Arrangements for trade in goods

Article 35

Free access for originating products

Products originating in the OCTs shall be imported into

1.
the Community free of import duty.

2.
The concept of originating products and the methods of
administrative cooperation relating thereto are laid down in
Annex III.

Article 36

Transhipment of non-originating products in free circula-
tion in the OCTs

1.
Products not originating in the OCTs but which are in
free circulation in an OCT and are re-exported as such to the
Community shall be accepted for import into the Community
free of customs duties and taxes having equivalent effect
providing that they:

(a) have paid, in the OCT concerned, customs duties or taxes
having equivalent effect of a level equal to, or higher than,
the customs duties applicable in the Community on import
these same products originating in third countries
of
eligible for the most-favoured-nation clause;

(b) have not been the subject of an exemption from, or a
refund of,
in whole or in part, customs duties or taxes
having equivalent effect, without prejudice to paragraph 2;

(c) are accompanied by an export certificate.

2. Without prejudice to paragraph 1, the Commission may,
following a duly substantiated request from the authorities of
the OCT concerned and in the light of the objectives of this
Decision, authorise OCT public financial aid to those operating
the transhipment procedure.

The request shall
in particular indicate the nature and the
anticipated volume of trade, which would benefit from the aid.

in free circulation,

This aid must take the form of an aid for transport of goods
put
including legitimate running costs
supported in relationship with the transhipment procedure.
This aid shall not provoke a serious disturbance or difficulties,
which may result in a deterioration in an economic sector of
the Community or of one or more Member States.

The OCT authorities may make representations to the Commis-
sion in order to provide further information to substantiate
their written request.

If the OCT authorities so request, a partnership working party
referred to in Article 7(3) shall be convened to resolve any
issues arising from the administration of
the transhipment
procedure.

3.

Paragraphs 1 and 2 shall not apply to:

(a) the agricultural products listed in Annex I to the Treaty nor
to products covered by Council Regulation (EEC) No 3448/
93 of 6 December 1993 laying down the trade arrange-
ments applicable to certain goods resulting from the
processing of agricultural products (1) except, as from 1
February 2002 and subject to the adoption by the Commis-
sion of the necessary implementing arrangements, for fish-
eries products:

(A) falling

CN

within

0303 31 10 00,
0304 20 95 10 and 0306 13 10 transhipped through
Greenland within an annual quantity of 10 000 tons,
and

codes

(1) OJ L 318, 20.12.1993, p. 18. Regulation as last amended by Regu-

lation (EC) No 2580/2000 (OJ L 298, 25.11.2000, p. 5).

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(B) falling within CN codes 0302 21 10, 0303 31 10,
0305 49 10, 0306 12 10, 0306 12 90, 0306 22 91,
0306 22 99, 0306 13 10, 0306 13 30, 0306 13 40,
0306 13 50, 0306 13 80, 0306 23 10, 0306 23 31,
0306 23 39, 0306 23 90 transhipped through Saint-
Pierre-et-Miquelon within an annual quantity of 2 000
tonnes;

(b) products subject, on import

to
quantitative restrictions or limitations or to anti-dumping
duties.

into the Community,

this area with a view to protecting the environment and public
health.

2.
The Community shall prohibit all direct or indirect export
of waste to the OCTs, with the exception of exports of non-
hazardous waste destined for recovery operations while at the
same time the OCT authorities shall prohibit the direct or
indirect import into their country of such waste from the
Community or any other country, without prejudice to specific
international undertakings concerning these areas that have
in the competent
been made, or may be made in future,
international fora.

4.
The conditions for entry into the Community of products
not originating in the OCTs but in free circulation in an OCT,
and the methods of administrative cooperation relating thereto,
are laid down in Annex IV.

3.
As regards the Community, Council Regulation (EEC) No
259/93 of 1 February 1993 on the supervision and control of
the European
shipments of waste within,
Community (1) shall apply.

into and out of

Article 37

Committee procedure

In matters covered by Article 36, the Commission shall

1.
be assisted by a Committee.

Articles 3 and 7 of Decision 1999/468/EC shall apply to

2.
the proceedings of the Committee.

3.

The Committee shall adopt its rules of procedure.

Article 38

Quantitative restrictions and measures having equivalent
effect

1.
The Community shall not apply to imports of products
originating in the OCTs any quantitative restrictions or meas-
ures having equivalent effect.

Paragraph 1 shall not preclude prohibitions or restric-
2.
tions on imports, exports or goods in transit
justified on
grounds of public morality or public policy, the protection of
health and life of humans, animals and plants, the protection of
national treasures possessing artistic, historic or archaeological
value, the conservation of exhaustible natural resources or the
protection of industrial and commercial property.

Such prohibitions or restrictions shall in no case constitute a
means of arbitrary or unjustifiable discrimination or a disguised
restriction of trade generally.

Article 39

Waste

1. Movements of waste between the Member States and the
OCTs shall be controlled in accordance with international and
Community law. The Community shall support the establish-
ment and development of effective international cooperation in

4.
As regards those OCTs, which, due to their constitutional
status, are not Party to the Basle Convention, their relevant
authorities shall expedite adoption of the necessary internal
legislation and administrative regulations to implement
the
provisions of the Basle Convention (2).

5.
In addition, the Member States concerned shall promote
the adoption by the OCTs of the necessary internal legislation
and administrative regulations to implement:

(a) Regulation (EEC) No 259/93 as follows:

(i) Article 13 as regards shipments of waste within the

OCTs,

(ii) Article 18 as regards exports of waste to the ACP States

from the OCTs;

(b) Regulation (EC) No 1420/1999 (3);

(c) Commission Regulation (EC) No 1547/1999 (4);

(d) European Parliament and Council Directive 2000/59/EC
subject to the time limits for transposition laid down in
Article 16 thereof (5).

As regards imports into the Community from the OCTs
6.
of hazardous waste and of non-hazardous waste destined for
final disposal, Articles 1 to 12 and 25 to 39 of Regulation
(EEC) No 259/93 and Commission Decision 94/774/EC (6),
shall apply.

7.
One or more OCTs and the Member State to which they
are linked may apply national procedures to export of waste
from the OCTs to that Member State.

(1) OJ L 30, 6.2.1993, p. 1. Regulation as last amended by Commis-

sion Decision 1999/816/EC (OJ L 316, 10.12.1999, p. 45).

(2) Council Decision 93/98/EEC of 1 February 1993 on the conclusion
on behalf of the Community, of the Convention on the control of
transboundery movements of hazardous wastes and their disposal
(Basle Convention) (OJ L 39, 16.2.1993, p. 1).

(3) Council Regulation (EC) No 1420/1999 of 29 April 1999 establis-
hing common rules and procedures
to
certain non-OECD countries of certain types of waste (OJ L 166,
1.7.1999, p. 6). Regulation as last amended by Commission Regula-
tion (EC) No 1800/2001 (OJ L 244, 14.9.2001, p. 19).

to apply to shipments

(4) Commission Regulation No 1547/1999/EC of 12 July 1999 deter-
mining the control procedures under Council Regulation (EEC) No
259/93 to apply to shipments of certain types of waste to certain
countries to which OECD Decision C(92)39 final does not apply
(OJ L 185, 17.7.1999, p. 1). Regulation as last amended by Regula-
tion (EC) No 1800/2001.

(5) European Parliament and Council Directive No 2000/59/EC of 27
November 2000 on port reception facilities for ship-generated waste
and cargo residues (OJ L 332, 28.12.2000, p. 81).

(6) Commission Decision 94/774/EC of 24 November 1994 concerning
the standard consignment note referred to in Council Regulation No
259/93/EEC on the supervision and control of shipments of waste
within,
the European Community (OJ L 310,
3.12.94, p. 70).

into and out of

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the Member State concerned notifies to the
In this case,
Commission the applicable legislation within six months from
the entry into force of this Decision or of any future relevant
national

including any amendments to it.

legislation,

Article 42

Safeguard measures

Article 40

Measures adopted by the OCTs

1.
In view of the present development needs of the OCTs,
the authorities of the OCTs may retain or introduce, in respect
of imports of products originating in the Community, such
customs duties or quantitative restrictions as they consider
necessary.

2.

(a) The trade arrangements applied to the Community by
the OCTs may not give rise to any discrimination
between Member States nor be less favourable than
most-favoured-nation treatment.

(b) Notwithstanding specific provisions of this Decision, the
Community shall not discriminate between OCTs in the
field of trade.

(c) The provisions of (a) shall not preclude a country or
territory from granting certain other OCTs or other
developing countries more favourable treatment than
that accorded to the Community.

3.
The authorities of the OCTs shall communicate to the
Commission, within a period of three months following the
entry into force of this Decision, the customs tariffs and lists of
quantitative restrictions which they apply.

They shall also communicate to the Commission any subse-
quent amendments to such measures as and when they are
adopted.

Article 41

Surveillance clause

1.
The products originating in the OCTs referred to in
Article 35 or products not originating in the OCT referred to in
Article 36 may be subject to special surveillance. The Commis-
sion shall decide to which products surveillance shall apply in
consultation with the OCT authorities and the Member State to
which the OCT is linked.

2.
Article 308d of Commission Regulation (EEC) No 2454/
93 of 2 July 1993, laying down provisions for the implementa-
tion of Council Regulation (EEC) No 2913/92 on the
Community Customs Code (1), shall apply.

3.
The Commission and the competent OCT authorities
shall ensure the effectiveness of the surveillance measures by
introducing the methods of administrative cooperation set out
in Annexes III and IV.

in a sector of

the economy of

If, as a result of the application of this Decision, serious
1.
disturbances occur
the
Community or one or more of its Member States, or their
external financial stability is jeopardised, or if difficulties arise
which may result in a deterioration in a sector of the Commu-
nity's activity or in a region of the Community, the Commis-
sion may, on its own initiative or at the request of one or more
Member States and following consultation with the Committee
referred to in Article 43 take or authorise the Member States
concerned to take the necessary safeguard measures, in accord-
ance with the paragraphs below.

2.
For the purpose of implementing paragraph 1, priority
shall be given to such measures as would least disturb the
the association and the Community. These
functioning of
measures shall not exceed the limits of what is strictly neces-
sary to remedy the difficulties that have arisen. They cannot
exceed the withdrawal of the preferential treatment granted by
this Decision.

3. When safeguard measures are taken or modified, partic-
ular attention shall be paid to the interests of the least-devel-
oped OCTs.

This Article is without prejudice to the rights and obliga-
4.
tions of the Community under WTO rules,
including those
contained in the WTO Agreement on Safeguards (2). Neither
shall it preclude application of the regulations establishing a
common organisation of agricultural markets, or Community
or national administrative provisions derived therefrom, or the
specific rules adopted under Article 235 of the Treaty for
processed agricultural products.

5.

(a) If a Member State asks the Commission for safeguard
measures to be applied, the Commission shall inform
the Council, the Member States and the OCT authorities
accordingly within three working days from the date of
receipt of the Member State's request, and shall invite
the OCT authorities to supply any information which
they consider important to the situation at hand.

(b) When the Commission acts on its own initiative, it shall
inform the OCTs concerned and the Member States at
the earliest possible stage.

(c) If the OCT authorities so require and without prejudice
to the deadlines referred to in this Article, a partnership
working party referred to in Article 7(3) shall be
convened. The outcome of the working party shall be
transmitted to the consultative committee. In this case,
the deadline referred to in paragraph 9 of this Article
shall be extended by ten working days. At the same time
it shall invite the Member States to a meeting of the
committee referred to in Article 43.

Member States and the OCTs shall provide the Commission
with any information necessary to justify their requests to
apply safeguard measures or not to do so.

(1) OJ L 253, 11.10.1993, p. 1. Regulation as last amended by Regula-

tion (EC) No 993/2001 (OJ L 141, 28.5.2001, p. 1).

(2) OJ L 336, 23.12.1994, p. 184.

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The Commission shall notify the Council, the Member
6.
States and the OCT authorities immediately of the decision to
take the necessary safeguard measures. The Decision shall apply
with immediate effect.

Any Member State may refer the Commission's decision
7.
referred to in paragraph 6 to the Council within 10 working
days of receiving notification of the decision.

8.
Should the Commission fail to adopt a decision within
21 working days or if it rejects the request or if the Commis-
sion decides not to take safeguard measures, any Member State
that has brought the matter before the Commission may refer
it to the Council.

9.
the
In the cases referred to in paragraphs 7 and 8,
Council, acting by a qualified majority, may adopt a different
decision within 21 working days.

Article 43

Committee procedure

In matters covered by Article 42, the Commission shall

1.
be assisted by a Committee.

Articles 3 and 7 of Decision 1999/468/EC shall apply to

2.
the proceedings of the Committee.

3.

The Committee shall adopt its rules of procedure.

C h a p t e r 2

Trade in services and rules of establishment

Article 44

General objective

The long-term aim in this area is a progressive liberalisation of
trade in services, with due respect for the OCTs' local policy
objectives, and taking due account of the level of development
of
entered into by the
Community, Member States or the OCTs in the WTO frame-
work.

the OCT and the obligations

Article 45

General principles of establishment and the provision of
services

For the purposes of this Chapter, the following defini-

1.
tions shall apply:

(a) ‘companies or enterprises’: companies or enterprises consti-
tuted under civil or commercial law, including public or
other companies, cooperative societies and any other legal
person or association governed by public or private law,
save for those which are non-profit-making.

‘Companies or enterprises of Member States’ are those
formed in accordance with the laws of a Member State and
whose registered office, central administration or principal
place of business is in a Member State. However, a
company or enterprise having only its registered office in a

Member State must be engaged in an activity which has an
actual and continuous link with the economy of
that
Member State.

‘OCT companies or enterprises’ are those formed in accord-
ance with the law applicable in a given OCT and whose
registered office, central administration or principal place of
business is in that OCT; however, a company or enterprise
having only its registered office in a country or territory
must be engaged in an activity which has an actual and
continuous link with the economy of that country or terri-
tory;

(b) ‘inhabitants of an OCT’: persons ordinarily resident in an
OCT who are nationals of a Member State or who enjoy a
legal status specific to an OCT. This definition is without
prejudice to the rights conferred by citizenship of
the
Union within the meaning of the Treaty.

As regards the arrangements applicable to establishment
2.
and the provision of services, in line with Article 183(5) of the
Treaty and subject to paragraph 3 below:

(a) the Community shall apply to the OCTs the undertakings
entered into under the General Agreement on Trade in
Services (GATS) under the conditions laid down in that
Agreement and in accordance with this Decision;
in
application of such undertakings, Member States shall not
discriminate between inhabitants, companies or enterprises
of the OCTs;

(b) the OCT authorities shall afford nationals, companies or
enterprises of the Member States treatment that is no less
favourable than that which they extend to nationals,
companies or enterprises of third countries and shall not
discriminate between nationals, companies or enterprises of
Member States.

The authorities of an OCT may with a view to promoting
3.
or supporting local employment, adopt regulations to aid their
inhabitants and local activities.

In this event, the OCT authorities shall notify the Commission
of
it may inform the
Member States.

the regulations they adopt so that

4. With regard to the professions of doctor, dentist,
midwife, general nurse, pharmacist and veterinary surgeon, the
Council, acting unanimously on a proposal from the Commis-
sion, shall adopt the list of professional qualifications specific
to OCT inhabitants which are to be recognised in the Member
States.

Article 46

Maritime transport

The objective of cooperation in this field shall be to ensure
harmonious development of efficient and reliable shipping
services on economically satisfactory terms by facilitating the
active participation of all parties according to the principle of
unrestricted access to the trade on a commercial basis.

This provision shall not apply to Greenland.

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C h a p t e r 3

Trade-related areas

Article 47

the OCTs undertake to implement local, national or regional
rules and policies including the control and, under certain
conditions, the prohibition of agreements between undertak-
ings, decisions by associations of undertakings and concerted
practices between undertakings which have as their object or
effect the prevention, restriction or distortion of competition.
The above prohibition also relates to the abuse by one or more
undertakings of a dominant position in the territory of the
Community or of the OCTs.

Current payments and capital movements

1. Without prejudice to paragraph 2:

(a) Member States and the OCT authorities shall impose no
restrictions on any payments in freely convertible currency
on the current account of balance of payments between
residents of the Community and of the OCTs;

(b) with regard to transactions on the capital account of
balance of payments, the Member States and the OCT
authorities shall impose no restrictions on the free move-
ment of capital for direct investments in companies formed
in accordance with the laws of the host Member State,
country or territory and to ensure that the assets formed by
such investment and any profit stemming therefrom can be
realised and repatriated.

2.
The Community, Member States and OCTs shall be enti-
tled to take the measures referred to mutatis mutandis in Articles
57, 58, 59, 60 and 301 of the Treaty in accordance with the
conditions laid down therein. Equally, where one or more
OCTs or one or more Member States is in serious balance of
payments difficulties, or under threat thereof, the OCT authori-
ties, the Member State or the Community may, in accordance
with the conditions established under the GATT, GATS and
Article VIII and XIV of the Articles of Agreement of the Inter-
national Monetary Fund, adopt restrictions on current transac-
tions which shall be of
limited duration and may not go
beyond what is necessary to remedy the balance of payments
situation. When taking such measures, the OCT authorities, the
Member State or the Community shall
inform each other
without delay and submit to each other as soon as possible a
timetable for the elimination of the measures concerned.

Article 49

Protection of intellectual property rights

An adequate and effective level of protection of intellec-
1.
tual,
including
industrial and commercial property rights,
means for enforcing such rights, shall be ensured in line with
the highest international standards with a view to reducing
distortions and impediments to bilateral trade.

inventions,

industrial designs, geographical

2.
Intellectual property rights cover copyright, including in
particular the copyright on computer programmes and neigh-
bouring rights, utility models, patents including bio-technolog-
ical
indications
including appellations of origin,
trademarks for goods or
services, topographies of integrated circuits, the legal protection
of data bases and the protection against unfair competition as
referred to in Article 10 bis of the Paris Convention for the
Protection of Industrial Property and protection of undisclosed
information on know-how.

Article 50

Standardisation and certification

Closer cooperation shall be pursued in the field of standardisa-
tion, certification and quality assurance to remove unnecessary
technical barriers and to reduce differences in those areas, so as
to facilitate trade.

Article 48

Competition policies

Article 51

1.
The introduction and implementation of effective and
sound competition policies and rules are of crucial importance
in order to improve and secure an investment friendly climate,
a sustainable industrialisation process and transparency in the
access to markets.

2.
To ensure the elimination of distortions to competition
and with due consideration to the different levels of develop-
ment and economic needs of each OCT, the Community and

Trade and the environment

Development of international trade shall be promoted in such a
way as to ensure sustainable and sound management of the
environment,
international
in accordance with the relevant
agreements and undertakings and with due regard to the
respective levels of development of the OCTs. The special needs
and requirements of the OCTs shall be taken into account in
the design and implementation of environmental measures.

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Bearing in mind the Rio Principles, cooperation shall aim at
ensuring the mutual supportiveness of trade and environment
policies,
in particular through the reinforcement of quality
controls of goods and services related to the environment and
the improvement of environment-friendly production methods.

Article 52

Trade and labour standards

The internationally and nationally recognised core labour stan-
dards must be respected, in particular the freedom of associa-
tion and protection of the right to organise, application of the
right to organise and to bargain collectively, the abolition of
forced labour, the elimination of worst forms of child labour,
the minimum age for admission to employment and non-
discrimination in respect to employment.

Article 53

Consumer policy and consumer health protection

Cooperation shall be pursued in the area of consumer policy
and consumer health protection, having due regard to the
legislation in force in OCTs and the Community to avoid
barriers to trade.

Article 54

Prohibition of disguised protectionist measures

The provisions of this Chapter shall not be used as a means of
arbitrary discrimination or a disguised restriction on trade.

C h a p t e r 4

Monetary and tax matters

Article 55

Tax carve-out clause

1. Without prejudice to the provisions of Article 56, the
most-favoured-nation treatment granted in accordance with the
provisions of this Decision shall not apply to tax advantages
which the Member States or OCT authorities are providing or
may provide in the future on the basis of agreements to avoid
double taxation or other tax arrangements, or domestic fiscal
legislation in force.

2.
Nothing in this Decision may be construed to prevent the
adoption or enforcement of any measure aimed at preventing
the avoidance or fraud of taxes pursuant to the tax provisions
of agreements to avoid double taxation or other tax arrange-
ments, or domestic fiscal

legislation in force.

Nothing in this Decision shall be construed to prevent the
3.
respective competent authorities from distinguishing,
in the
application of the relevant provisions of their fiscal legislation,
between taxpayers who are not in the same situation, in partic-
ular with regard to their place of residence, or with regard to
the place where their capital

is invested.

Article 56

Tax and customs arrangements for Community-funded
contracts

1.
The OCTs shall apply to Community-funded contracts
tax and customs arrangements no less favourable than those
applied by them to the most-favoured States or international
development organisations with which they have relations. For
the purpose of determining the most-favoured-nation treat-
ment, account shall not be taken of arrangements applied by
the relevant authorities of the country or territory concerned to
other developing countries.

Subject to paragraph 1, the following arrangements shall

2.
apply to contracts financed by the Community:

(a) the contract shall not be subject in the beneficiary OCT to
stamp or registration duties or to fiscal charges having
equivalent effect, whether such charges already exist or are
to be instituted in the future; however, such contracts shall
be registered in accordance with the laws in force in the
OCT and a fee corresponding to the service rendered may
be charged for it;

(b) profits and/or income arising from the performance of
contracts shall be taxable according to the internal fiscal
arrangements of the OCT concerned, provided that the
natural or legal persons who realise such profit and/or
income have a permanent place of business in that OCT, or
that the performance of the contract takes longer than six
months;

(c) enterprises which must import equipment in order to carry
out works contracts shall, if they so request, benefit from
the system of temporary admission as laid down by the
legislation of the beneficiary OCT in respect of that equip-
ment;

(d) professional equipment necessary for carrying out tasks
defined in a service contract shall be temporarily admitted
into the beneficiary OCT in accordance with the legislation
of that OCT free of fiscal, import and customs duties and
of other charges having equivalent effect where these duties
and charges do not constitute remuneration for services
rendered;

(e) imports under supply contracts shall be admitted into the
beneficiary OCT without customs duties,
import duties,
taxes or fiscal charges having equivalent effect. The contract
for
territory
concerned shall be concluded on the basis of the ex-works
price of the supplies, to which may be added such internal
fiscal charges as may be applicable to those supplies in the
country or territory;

supplies originating in the

country or

(f) fuels, lubricants and hydrocarbon binders and, in general,
all materials used in the performance of works contracts
shall be deemed to have been purchased on the local
market and shall be subject to fiscal rules applicable under
the legislation in force in the beneficiary OCT;

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(g) personal and household effects imported for use by natural
persons, other than those recruited locally, engaged in
carrying out
tasks defined in a service contract and
members of their families, shall be exempt from customs or
import duties, taxes and other fiscal charges having equiva-
lent effect, within the limits of the legislation in force in the
beneficiary OCT.

Any matter not covered by paragraphs 1 and 2 shall

3.
remain subject to the legislation of the OCT concerned.

4.
The Commission officials, excluding locally hired staff,
shall be exempt from all taxes levied in the country or territory
where they are posted.

C h a p t e r 5

Vocational training, eligibility for Community programmes
and other provisions

Article 57

Vocational training

Individuals from an OCT with the nationality of a Member
State shall be eligible to receive vocational training in the
Community on the same basis as nationals of the Member
State in question where they can meet the conditions required
to be met by those nationals, including any condition of resi-
dence within the Community or the EEA.

Article 58

Programmes open to the OCTs

and any programmes succeeding them, subject to the rules of
the programmes and the arrangements applicable to the
Member State with which they are connected.

The Commission may modify this list at the request of an OCT
or a Member State or at its own initiative.

Article 59

Euro-Info Correspondence Centres (EICC)

At the request of the OCT authorities and in accordance with
the procedures specified in Part Three, Title I, a Euro-Info
Correspondence Centre, hereinafter referred to as ‘'EICC’, may
be set up in an OCT. Part-financing may be made available to
the EICC host structure from the grant aid available under the
SPD or regional cooperation.

The tasks of the EICCs, the tools and services made available to
them, the establishment procedures and criteria for selecting
the host structure are set out in Annex V.

Article 60

CDE and CTA

At the request of their authorities, the OCT shall be eligible for
the services of the Centre for the Development of Enterprise
(CDE) and of the Technical Centre for Agricultural and Rural
Cooperation (CTA) referred to in Article 1 of Annex III to the
ACP/EC Partnership Agreement.

Individuals from an OCT and where applicable the relevant
public and/or private bodies and institutions in an OCT shall
be eligible for the Community programmes listed in Annex II F

Any costs resulting from services provided by the CDE or CTA
for the benefit of the OCTs shall be financed from the funds
provided for in Annex II A.

PART FOUR

FINAL PROVISIONS

Article 61

Change of status

If an OCT becomes independent:

(a) the arrangements provided for

in this Decision may
continue to apply provisionally to that country or territory
under conditions laid down by the Council;

(b) the Council, acting unanimously on a proposal from the
Commission, shall decide on any necessary adjustments to
in particular to the amounts specified in
this Decision,
Annex II A.

set out in Articles 182 to 186 of the Treaty. In this context, the
Council shall in particular adopt any necessary measures where
an OCT decides in accordance with its own constitutional
procedures to enter
into special preferential arrangements
between the Community and various partners in the region to
which it belongs. The Council shall take particular account in
this respect of international obligations entered into by the
Community, its Member States or the OCTs, including those
within the framework of the WTO.

Article 62

Review

Article 63

Entry into force

Before 31 December 2007, the Council, acting unanimously on
a proposal from the Commission, shall establish the provisions
to be laid down for the subsequent application of the principles

This Decision shall enter into force on 2 December 2001. It
shall be applicable until 31 December 2011.

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Article 64

Publication

This Decision shall be published in the Official Journal of the European Communities.

Done at Brussels, 27 November 2001.

For the Council

The President

A. NEYTS-UYTTEBROECK

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LIST OF THE COUNTRIES AND TERRITORIES (OCTs) REFERRED TO IN ARTICLE 1

ANNEX I A

— Greenland,
— New Caledonia and Dependencies,
— French Polynesia,
— French Southern and Antarctic Territories,
— Wallis and Futuna Islands,
— Mayotte,
— St Pierre and Miquelon,
— Aruba,
— Netherlands Antilles:

— Bonaire,
— Curaçao,
— Saba,
— Saint Eustatius,
— Saint Martin (Sint Maarten),

— Anguilla,
— Cayman Islands,
— Falkland Islands,
— South Georgia and the South Sandwich Islands,
— Montserrat,
— Pitcairn,
— Saint Helena, Ascension Island, Tristan da Cunha,
— British Antarctic Territory,
— British Indian Ocean Territory,
— Turks and Caicos Islands,
— British Virgin Islands.

LIST OF THE OCTs CONSIDERED THE LEAST DEVELOPED, FOR THE PURPOSES OF THIS DECISION,
REFERRED TO IN ARTICLE 3(3)

ANNEX I B

— Anguilla,
— Mayotte,
— Montserrat,
— Saint Helena, Ascension Island, Tristan da Cunha,
— Turks and Caicos Islands,
— Wallis and Futuna Islands,
— St Pierre and Miquelon.

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ANNEX II A

COMMUNITY FINANCIAL ASSISTANCE: 9TH EDF

Article 1

Allocation between the various instruments

1.
For the purposes set out in this Decision, for the five-year
period from 1 March 2000 to 28 February 2005, the overall
amount of Community financial assistance of EUR 175 million
under the 9th European Development Fund (EDF) fixed by the
Internal Agreement shall be allocated as follows:

(a) EUR 153 million in the form of grants,

including:

(i) EUR 145 million for programmable support for long-
term development, humanitarian aid, emergency aid,
refugee aid and the additional support in the event of
fluctuations in export earnings. This amount shall be
used in particular to finance the initiatives referred to in
the Single Programming Documents (SPD);

(ii) EUR 8 million to support regional cooperation and
integration including the dialogue and partnership
actions laid down in Article 7;

(b) EUR 20 million shall be allocated to finance the OCT

Investment Facility referred to in Annex II C.

(c) EUR 2 million shall be allocated to studies or technical
assistance measures on the initiative or on the behalf of the
the
Commission, notably for an overall evaluation of
Decision to be made two years before it expires at the
latest.

In addition, the overall amount of financial assistance
2.
under the 9th EDF, plus any balances transferred to the 9th
EDF from previous Funds pursuant to the Internal Agreement
shall cover the period 2000 to 2007. Before the expiry of the
9th EDF, the Member States shall assess the degree of realisa-
tion of commitments and disbursements. The need for new
resources to support financial cooperation shall be determined
in the light of this assessment and shall take due account of the
uncommitted and non-disbursed resources under the 9th EDF.

3.
Before the expiry of the 9th EDF, the Member States shall
set a date beyond which the funds of the 9th EDF may no
longer be committed.

Should the funds provided for

4.
in paragraph 1 be
exhausted before this Decision expires, the Council shall take
the appropriate measures.

Article 2

Administration of resources

Article 3

Allocation between the OCTs

The amount of EUR 145 million mentioned in Article
1.
1(1)(i) shall be allocated on the basis of
the needs and
performance of the OCTs in accordance with the following
criteria:

(a) An amount A of EUR 66,1 million shall be allocated to the
is least advanced,
OCTs whose economic development
namely those with a per capita Gross National Product
(GNP) not exceeding 75 % of
the Community GNP,
according to the available statistical data.

(b) An amount B of EUR 61 million is allocated to the OCT
with a per capita GNP not exceeding the Community's
GNP, in order to finance priority actions for social develop-
ment and environmental protection, within the framework
of the fight against poverty.

(c) The allocation of amounts A and B shall take into account
the population, the level of the GNP, the use made of
previous EDFs, the respect of the principles of sound inter-
national tax and financial management, constraints due to
estimated absorption
geographical
capacity and a smooth transition to prevent a sudden
considerable setback in allocation for New Caledonia,
French Polynesia and the Netherlands Antilles. Any alloca-
tion shall be such as to allow its effective use. It should be
decided in conformity with the principle of subsidiarity.

characteristics,

the

2.
The question of a possible allocation to Greenland will be
examined in the light of the review provided for in Article 14
of the Protocol on the fishing conditions for the period 2001
to 2006 (1).

A non-allocated reserve C of EUR 17,9 million is set

3.
aside in order:

(a) to finance humanitarian, emergency and refugee aid for all
the OCTs and, if necessary, the additional support in the
event of fluctuations in export earnings, in accordance with
Annex II D;

(b) to make new allocations in accordance with the develop-

ment of the needs and performance of the OCTs.

Performance is evaluated in an objective and transparent
way, taking into account the use of the allocated resources,
the effective implementation of the on-going operations,
the alleviation or reduction of poverty and the sustainable
development measures adopted;

(c) If appropriate, to take the necessary measures, following

the review referred to in paragraph 2;

(d) A maximum amount of EUR 1 million is set aside to fund
the interest subsidies for operations to be financed by the
Bank from its own resources, in accordance with Annex II
B, or under the OCT Investment Facility.

The EIB shall administer
the loans made from its own
resources, as well as the operations financed under the OCT
Investment Facility. All other financial resources under this
Decision shall be administered by the Commission.

(1) Council Regulation (EC) No 1575/2001 of 25 June 2001 on the
conclusion of the Fourth Protocol laying down the conditions rela-
ting to fishing provided for in the Agreement on fisheries between
the European Economic Community, on the one hand, and the
Government of Denmark and the local Government of Greenland,
on the other (OJ L 209, 2.8.2001, p. 1).

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In accordance with the paragraphs above and without prejudice to the transfer of the unspent

4.
balances from previous EDF, the indicative amounts allocated under the 9th EDF are the following:

9th EDF initial indicative allocation

(EUR in millions)

OCT

New Caledonia

French Polynesia

Wallis and Futuna

Mayotte

St Pierre and Miquelon

Netherlands Antilles

Falkland Islands

Turks and Caicos

Anguilla

Montserrat

Saint Helena and dependencies
(Ascension, Tristan da Cunha)

Pitcairn

Total

Non-allocated C reserve

A

8

9,9

5,6

11,7

8,2

7,9

5,3

7,5

2

Total

13,75

13,25

11,5

15,2

12,4

20,0

3

8,4

8

11,0

8,6

2

B

13,75

13,25

3,5

5,3

6,8

8,3

3

0,2

0,1

5,7

1,1

EUR 127,1 million

EUR 17,9 million

5.
The Commission, following a mid-term review, may decide a different allocation of any non-allocated
balances of the funds mentioned in this Article. The procedures for this review and the decision on any new
allocation are adopted in accordance with Article 24 of this Decision.

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COMMUNITY FINANCIAL ASSISTANCE: LOANS FROM THE EUROPEAN INVESTMENT BANK'S OWN
RESOURCES

ANNEX II B

Article 1

Amount

An amount of up to EUR 20 million as laid down in Article 5
of the Internal Agreement shall be provided by the EIB in the
form of loans from its own resources in accordance with the
conditions provided for by its statutes and this Annex.

Article 2

European Investment Bank

1.

The EIB shall:

(a) contribute,

it manages,

through the resources

to the
economic and industrial development of the OCTs on a
territorial and regional basis; and to this end, finance as a
priority productive projects and programmes or other
investments aimed at promoting the private sector in all
economic sectors;

(b) establish close cooperation links with national and regional
development banks and with banking and financial institu-
tions of the OCTs and of the Community;

(c) in consultation with the OCT concerned, adapt the arrange-
ments and procedures
implementing development
for
finance cooperation, as set out in this Decision, if neces-
sary, to take account of the nature of the projects and
programmes and to act in accordance with the objectives of
this Decision, within the framework of the procedures laid
down by its statute.

Loans from the EIB's own resources shall be granted

2.
under the following terms and conditions:

(a) the reference rate of interest shall be the rate applied by the
EIB for a loan with the same conditions as to currency, and
repayment period on the day of signature of the contract or
on the date of disbursement;

(b) however:

(i) in principle, public sector projects shall be eligible for

an interest rate subsidy of 3 %;

(ii) for private sector projects which involve restructuring
operations in the framework of privatisation or for
projects with substantial and clearly demonstrable social
or environmental benefits, loans may be extended with
an interest rate subsidy the amount and form of which
will be decided with respect to the particular character-
istics of the project. However, the interest rate subsidy
shall not be higher than 3 %.

The final interest rate shall, in any case, never be less than
50 % of the reference rate.

(c) the amount of the interest rate subsidy calculated in terms
of its value at the times of disbursement of the loan shall be
charged against the interest subsidy allocation laid down in
Annex II A, Article 3(3)(d), and paid directly to the EIB;

Interest subsidies may be capitalised or used in the form of
grants to support project-related technical assistance, partic-
ularly for financial

institutions in the OCTs.

(d) the repayment period of loans made by the EIB from its
own resources shall be determined on the basis of the
economic and financial characteristics of the project, but
may not exceed 25 years. These loans shall normally
comprise a grace period fixed by reference to the construc-
tion period of the project.

For

investments financed by the EIB from its own
3.
resources in public sector companies, specific project-related
guarantees or undertakings may be required from the OCT
concerned.

Article 3

Conditions for foreign exchange transfer

The OCT concerned shall, in respect of operations under this
Decision and in respect of which they have given their written
approval:

(a) grant exemption from all national or local duties, fiscal
charges on interest, commission and amortisation of loans
due in accordance with the law or laws of
the OCTs
concerned;

(b) place at the disposal of the beneficiaries the currency neces-
sary for the payment of interest, commission and the amor-
tisation of loans due in terms of financing contracts granted
for the implementation of projects and programmes on
their territories;

(c) make available to the EIB the foreign currency necessary for
the transfer of all sums received by it in national currency
at the exchange rate applicable between the Euro or other
currencies of transfer and the national currency at the date
of the transfer. These include all forms of remuneration,
such as, inter alia, interest, dividends, commissions and fees,
as well as the amortisation of loans and the proceeds from
financing contracts
the sale of shares due in terms of
granted
and
projects
of
implementation
the
programmes on their territories.

for

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ANNEX II C

COMMUNITY FINANCIAL ASSISTANCE: THE OCT INVESTMENT FACILITY

Article 1

Objective

An OCT Investment Facility (hereinafter referred to as ‘the
Facility’) shall be set up to promote commercially viable enter-
prises, mainly in the private sector but also those in the public
sector supporting private sector development.

(c) subordinated loans, which shall be repaid only after other

claims have been settled.

The remuneration of each operation shall be specified

4.
when the loan is made.

However:

The terms and conditions of financing in relation to the opera-
tions of the Facility and the loans from own resources of the
EIB shall be as laid down in this Annex, Annex II B and Articles
29 and 30 of the Internal Agreement. These resources may be
channelled to eligible enterprises, either directly or indirectly,
through eligible investment funds and/or financial intermedia-
ries.

(a) in the case of conditional or participating loans, the remu-
neration shall normally comprise a fixed interest rate of not
more than 3 % and a variable component related to the
performance of the project;

(b) in the case of subordinated loans, the interest rate shall be

market related.

Article 2

Resources of the Facility

1.

The resources of the Facility may be used, inter alia, to:

(a) provide risk capital

in the form of:

(i) equity participation in OCT enterprises,

including

financial

institutions;

(ii) quasi-capital assistance to OCT enterprises,

including

financial

institutions;

(iii) guarantees and other credit enhancements which may
be used to cover political and other investment-related
risks, both for foreign and local investors or lenders.

(b) provide ordinary loans.

2.
Equity participation shall normally be for non-controlling
minority holdings and shall be remunerated on the basis of the
performance of the project concerned.

Quasi-capital assistance may consist of

3.
shareholders'
advances, convertible bonds, conditional, subordinated and
participating loans or any other similar form of assistance.
Such assistance may consist in particular of:

(a) conditional

loans,

the servicing and/or the duration of
which shall be linked to the fulfilment of certain conditions
with regard to the performance of
in the
specific case of conditional loans for pre-investment studies
or other project-related technical assistance, servicing may
be waived if the investment is not carried out;

the project;

Guarantees shall be priced so as to reflect

5.
insured and the particular characteristics of the operation.

the risks

6.
The interest rate of ordinary loans shall comprise a refer-
ence rate applied by the EIB for comparable loans with the
same terms and conditions as to grace and repayment periods
and a mark up determined by the EIB.

Ordinary loans may be extended on concessional terms

7.
and conditions in the following cases:

(a) for infrastructure projects in the least developed OCTs that
are prerequisites for private sector development. In such
cases, the interest rate of the loan will be reduced by 3 %;

(b) for projects which involve restructuring operations in the
framework of privatisation or for projects with substantial
and clearly demonstrable social or environmental benefits.
In such cases, loans may be extended with an interest rate
subsidy the amount and form of which will be decided with
respect
the project.
However, the interest rate subsidy shall not be higher than
3 %.

to the particular characteristics of

The final interest rate shall, in any case, never be less than 50 %
of the reference rate.

8.
The funds to be provided for these concessional purposes
will be made available from the Facility and shall not exceed
5 % of the overall amount allocated for investment financing
by the Facility and by the EIB from its own resources.

(b) participating loans, the servicing and/or the duration of
which shall be linked to the financial return of the project;

9.
Interest subsidies may be capitalised or may be used in
the form of grants to support project-related technical assis-
tance, particularly for financial

institutions in the OCTs.

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Article 3

Operations of the Facility

1.
The Facility shall operate in all economic sectors and
support investments of private and commercially run public
including revenue generating economic and
sector entities,
technological infrastructure critical for the private sector. The
Facility shall:

(a) be managed as a revolving fund and aim at being finan-
cially sustainable. Its operations shall be on market-related
terms and conditions and shall avoid creating distortions
on local markets and displacing private sources of finances;

(b) endeavour to have a catalytic effect by encouraging the
long-term local resources and attracting
mobilisation of
foreign private investors and lenders to projects in the
OCTs.

Article 4

Conditions for foreign exchange rate risk

In order to minimise the effects of exchange rate fluctuations,
the problems of exchange rate risk shall be dealt with in the
following way:

(a) in the case of equity participation designed to strengthen an
enterprise's own funds, the exchange rate risk shall, as a
general rule, be borne by the Facility;

(b) in the case of risk capital financing for small- and medium-
sized enterprises (SMEs), the exchange rate risk shall, as a
general rule, be shared by the Community, on the one part,
and by the other parties involved, on the other. On average,
the foreign exchange rate risk shall be shared equally;

On expiry of

2.
this Decision and in the absence of a
specific decision by the Council, the cumulative net reflows to
the Facility shall be carried over to the next OCT Financial
Instrument.

(c) where feasible and appropriate, particularly in countries
characterised by macroeconomic and financial stability, the
Facility will endeavour to extend loans in local OCT curren-
cies, thus taking the foreign exchange risk.

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COMMUNITY FINANCIAL ASSISTANCE: ADDITIONAL SUPPORT IN THE EVENT OF SHORT-TERM FLUCTU-
ATIONS IN EXPORT EARNINGS

ANNEX II D

Article 1

Principles

The degree of dependence of an OCT economy on the
1.
export of goods, and in particular from agricultural and mining
products shall be a criterion for determining the allocation of
long-term development.

In order to mitigate the adverse effects of instability of
2.
export earnings and safeguard the development programme
jeopardised by the drop in revenue, additional financial support
may be mobilised from the programmable resources for the
country's long-term development on the basis of Articles 2
and 3.

Article 2

Eligibility criteria

1.
Eligibility for additional resources shall be established by:
— a 10 %, or 2 % in the case of least-developed countries, loss
of export earnings from goods compared with the arithmet-
ical average of the earnings in the first three years of the
first four years preceding the application year;
or

— a 10 %, or 2 % in the case of least-developed countries, loss
of export earnings from the total of agricultural or mineral
products compared with the arithmetical average of the
earnings in the first three years of the first four years
preceding the application year for countries where the agri-
cultural or mineral export revenues represent more than
40 % of total export revenues from goods.

Entitlement to additional support shall be limited to four

2.
successive years.

3.
The additional resources shall be reflected in the public
accounts of the country concerned. They shall be utilised in
accordance with the implementing provisions to be laid down
pursuant to Article 23 of this Decision. By agreement of both
Parties the resources may be used to finance programmes
included in national budget. However a part of the additional
resources may also be set aside for specific sectors.

Article 3

Advances

The system for allocating additional resources shall provide for
advances to cover any delays in obtaining consolidated trade
statistics and to ensure that the resources in question can be
included in the budget of the year following the application
year. Advances shall be mobilised on the basis of provisional
export statistics drawn up by the authorities of the OCTs and
submitted to the Commission in advance of the official final
consolidated statistics. The maximum advance shall be 80 % of
the estimated amount of additional resources for the applica-
tion year. The amounts thus mobilised shall be adjusted by
common agreement between the Commission and the authori-
ties of the OCT in the light of final consolidated export statis-
tics and the final figure of the public deficit.

Article 4

Revision

The provisions in this Annex shall be subject to review at the
latest after two years from the entry into force of the imple-
menting provisions referred to in Article 23 of this Decision
and subsequently at the request of the Commission, a Member
State or an OCT.

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COMMUNITY FINANCIAL ASSISTANCE: BUDGETARY AID FOR DEVELOPING COUNTRIES

ANNEX II E

Without prejudice to future modifications of budgetary provisions, the OCTs benefit from the following budget lines
foreseen for developing countries within the general budget of the European Union. Except if explicitly excluded, the
OCTs may benefit from the general budget funds granted to developing countries.

1. Food and Humanitarian aid (Title B7-2 1)

— Council Decision 1999/576/EC of 29 June 1999 on the signing and notification of the provisional application of

the Food Aid Convention 1999 on behalf of the European Community (1).

— Council Decision 2000/421/EC of 13 June 2000, on the conclusion, on behalf of the European Community, of the

Food Aid Convention 1999 (2).

— Council Regulation (EC) No 1292/96 of 27 June 1996 on food aid policy and food aid management and special

operations in support of food security (3).

— Council Regulation (EC) No 1257/96 of 20 June 1996 concerning humanitarian aid (4).

2. Community measures to support NGOs (Chapter B7.60)

— Resolution of the European Parliament of 14 May 1992 on the role of the non-governmental organisations in

development cooperation (5).

— Council Regulation (EC) No 1658/98 of 17 July 1998 on co-financing operations with European non-govern-

mental development organisations (NGOs) in fields of interest to the developing countries (6).

3. Training and promotion of awareness of development issues (Chapter B7.61)

— Council Regulation (EC) No 2836/98 of 22 December 1998 on integrating gender issues in development

cooperation (7).

4. Environment (Chapter B7.62)

— Regulation (EC) No 2493/2000 of the European Parliament and of the Council of 7 November 2000 on measures
integration of the environmental dimension in the development process of developing

to promote the full
countries (8).

— Regulation (EC) No 2494/2000 of the European Parliament and of the Council of 7 November 2000 on measures
to promote the conservation and sustainable management of tropical forests and other forests in developing
countries (9).

5. Health and the fight against drugs, population and demography in the developing countries (Chapter B7.63)

— Council Regulation (EC) No 2046/97 of 13 October 1997 on north-south cooperation in the campaign against

drugs and drug addiction (10).

— Council Regulation (EC) No 550/97 of 24 March 1997 on HIV/AIDS-related operations in developing coun-

tries (11).

6. Specific aid schemes in the development field (Chapter B7.64)

— Council Regulation (EC) No 2258/96 of 22 November 1996 on rehabilitation and reconstruction operations in

developing countries (12).

— Council Regulation (EC) No 1659/98 of 17 July 1998 on decentralised cooperation (13).

(1) OJ L 222, 24.8.1999, p. 38.
(2) OJ L 163, 4.7.2000, p. 37.
(3) OJ L 166, 5.7.1996, p. 1.
(4) OJ L 163, 2.7.1996, p. 1.
(5) OJ C 150, 15.6.1992, p. 273.
(6) OJ L 213, 30.7.1998, p. 1. Regulation as amended by Regulation of the European Parliament and of the Council (EC) No 1726/

2001 (OJ L 234, 1.9.2001, p. 10).

(7) OJ L 354, 30.12.1998, p. 5.
(8) OJ L 288, 15.11.2000, p. 1.
(9) OJ L 288, 15.11.2000, p. 6.
(10) OJ L 287, 21.10.1997, p. 1.
(11) OJ L 85, 27.3.1997, p. 1.
(12) OJ L 306, 28.11.1996, p. 1.
(13) OJ L 213, 30.7.1998, p. 6.

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7. Campaign against sex tourism in third countries (Chapter B7.626)

— Implementation of the activities envisaged under the campaign against child sex tourism will continue on the basis
of the Commission communication of 26 May 1999 and the Council conclusions of 21 December 1999.

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ANNEX II F

OTHER COMMUNITY ASSISTANCE: PARTICIPATION IN COMMUNITY PROGRAMMES

The following programmes, and any programmes succeeding them, shall apply to OCT nationals within the framework of
the quota for the Member State to which the OCT concerned is linked:

1.

Education and training programmes:

(a) Leonardo da Vinci, second phase of the Community vocational training action programme, set up by Council

Decision 1999/382/EC of 26 April 1999 (1),

(b) Promotion of European pathways for work-linked training, including apprenticeship, set up by Council Decision

1999/51/EC of 21 December 1998 (2),

(c) Socrates, second phase of the Community action programme in the field of education, set up by Decision

253/2000/EC of the European Parliament and of the Council of 24 January 2000 (3),

(d) ‘Youth’ Community action programme, established by Decision 1031/2000/EC of the European Parliament and

of the Council of 13 April 2000 (4).

2.

The enterprise support programmes:

(a) Multi-annual Programme for Enterprise and Entrepreneurship (2001-2005), set up by Council Decision 2000/

819/EC of 20 December 2000 (5),

(b) Artisanat, provided for in the programme referred to in (a),

(c) Euromanagement, provided for in the programme referred to in (a),

(d) Seed capital, according to the third multiannual programme for SMEs, set up by Council Decision 97/15/EC of 9

December 1996 (6).

3. Research, development and innovation programmes of the 5th Framework Programme:

3.1. Theme programmes:

(a) Specific programme for research, technological development and demonstration on quality of life and manage-

ment of living resources (1998 to 2002) (7),

(b) Specific programme for research, technological development and demonstration on a user-friendly information

society (1998 to 2002) (8),

(c) Specific programme for research, technological development and demonstration on competitive and sustainable

growth (1998 to 2002) (9),

(d) Specific programme for research, technological development and demonstration on energy, environment and
sustainable development (1998 to 2002), set up by Council Decision 1999/171/EC of 25 January 1999 (10).

3.2. Horizontal Programmes:

(a) Specific programme on confirming the international role of Community research (1998-2002) (11).

(b) Specific programme for research, technological development and demonstration on promotion of innovation

and encouragement of SME participation (1998-2002) (12).

(c) Specific programme for research, technological development and demonstration on improving the human

research potential and the socio-economic knowledge base (1998-2002) (13).

4. Cultural and audio-visual programmes:

(a) Programme to encourage the development, distribution and promotion of European audio-visual works (Media
Plus — Development, Distribution and Promotion) for the period 2001-2005, set up by Council Decision
2000/821/EC of 20 December 2000.

(b) Culture 2000 (2000-2004), set up by Decision 508/2000/EC of the European Parliament and the Council of 14

February 2000 (14).

5.

The HRTP Japan programme (human resources training programme in Japan) and topical missions, set up by
Council Decision 92/278/EEC of 18 May 1992. (15)

(1) OJ L 146, 11.6.1999, p. 33.
(2) OJ L 17, 22.1.1999, p. 45.
(3) OJ L 28, 3.2.2000, p. 1.
(4) OJ L 117, 18.5.2000, p. 1.
(5) OJ L 333, 29.12.2000, p. 84.
(6) OJ L 6, 10.1.1997, p. 25.
(7) OJ L 64, 12.3.1999, p. 1.
(8) OJ L 64, 12.3.1999, p. 20.
(9) OJ L 64, 12.3.1999, p. 40.
(10) OJ L 64, 12.3.1999, p. 58.
(11) OJ L 64, 12.3.1999, p. 78.
(12) OJ L 64, 12.3.1999, p. 91.
(13) OJ L 64, 12.3.1999, p. 105.
(14) OJ L 63, 10.3.2000, p. 1.
(15) OJ L 144, 26.5.1992, p. 19.

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CONCERNING THE DEFINITION OF THE CONCEPT OF ‘ORIGINATING PRODUCTS’ AND METHODS OF
ADMINISTRATIVE COOPERATION

ANNEX III

TITLE I

GENERAL PROVISIONS

— Article 1

Definitions

INDEX

TITLE II

DEFINITION OF THE CONCEPT OF ‘ORIGINATING PRODUCTS’

— Article 2

General requirements

— Article 3

Wholly obtained products

— Article 4

Sufficiently worked or processed products

— Article 5

Insufficient working or processing operations

— Article 6

Cumulation of origin

— Article 7

Unit of qualification

— Article 8

Accessories, spare parts and tools

— Article 9

Sets

— Article 10

Neutral elements

TITLE III

TERRITORIAL REQUIREMENTS

— Article 11

Principal of territoriality

— Article 12

Direct transport

— Article 13

Exhibitions

TITLE IV

PROOF OF ORIGIN

— Article 14

General requirements

— Article 15

Procedure for the issue of a movement certificate EUR.1

— Article 16

Movement certificates EUR.1 issued retrospectively

— Article 17

Issue of a duplicate movement certificate EUR.1

— Article 18

Issue of movement certificates EUR.1 on the basis of a proof of origin issued or made out previously

— Article 19

Conditions for making out an invoice declaration

— Article 20

Approved exporter

— Article 21

Validity of proof of origin

— Article 22

Transit procedure

— Article 23

Submission of proof of origin

— Article 24

Importation by instalments

— Article 25

Exemptions from proof of origin

— Article 26

Information procedure for cumulation purposes

— Article 27

Supporting documents

— Article 28

Preservation of proof of origin and supporting documents

— Article 29

Discrepancies and formal errors

— Article 30

Amounts expressed in EUR

TITLE V

ARRANGEMENTS FOR ADMINISTRATIVE COOPERATION

— Article 31

Communication of stamps and addresses

— Article 32

Verification of proofs of origin

— Article 33

Verification of suppliers declarations

— Article 34

Dispute settlement

— Article 35

Penalties

— Article 36

Free zones

— Article 37

Derogations

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TITLE VI

CEUTA AND MELILLA

— Article 38

Special conditions

TITLE VII

FINAL PROVISIONS

— Article 39

Revision of Rules of Origin

— Article 40

Appendices

— Article 41

Implementation of the Annex

— Article 42

Transitional period concerning the making out of forms EUR.2

Appendices

— Appendix 1

Introductory notes to the list in Appendix 2.

— Appendix 2

List of working or processing required to be carried out on non-originating materials in order that
the product manufactured can obtain originating status.

— Appendix 3

Form for movement certificate EUR.1

— Appendix 4

Invoice declaration.

— Appendix 5A

Supplier declaration for products having preferential origin status.

— Appendix 5B

Supplier declaration for products not having preferential origin status.

— Appendix 6

Information certificate.

— Appendix 7

Form for application for a derogation.

TITLE I

GENERAL PROVISIONS

Article 1

Definitions

For the purposes of this Annex:

(a) ‘manufacture’ means any kind of working or processing

including assembly or specific operations;

(b) ‘material’ means any ingredient, raw material, component
or part, etc., used in the manufacture of the product;

(c) ‘product’ means the product being manufactured, even if it
is intended for later use in another manufacturing opera-
tion;

(d) ‘goods’ means both materials and products;

(e) ‘customs value’ means the value as determined in accord-
ance with the 1994 Agreement on implementation of
Article VII of the General Agreement on Tariffs and Trade
(WTO Agreement on customs valuation);

(f) ‘ex-works price’ means the price paid for the product ex
works to the manufacturer in whose undertaking the last
working or processing is carried out, provided the price
includes the value of all the materials used, minus any
internal taxes which are, or may be, repaid when the
product obtained is exported;

(g) ‘value of materials’ means the customs value at the time of
importation 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;

(h) ‘value of originating materials’ means the value of such
materials as defined in subparagraph (g) applied mutatis
mutandis;

(i) ‘value added’ shall be taken to be the ex-works price minus
the customs value of third-country materials imported into
the Community, the ACP States or the OCT;

(j) ‘chapters’ and ‘headings’ mean the chapters and the head-
ings (four-digit codes) used in the nomenclature which
makes up the Harmonised Commodity Description and
Coding System, referred to in this Annex as ‘the Harmo-
nised System’ or ‘HS’;

(k) ‘classified’ refers to the classification of a product or

material under a particular heading;

(l) ‘consignment’ means products which are either sent simul-
taneously from one exporter to one consignee or covered
by a single transport document covering their shipment
from the exporter to the consignee or, in the absence of
such a document, by a single invoice;

(m) ‘territories’

includes territorial waters.

TITLE II

DEFINITION OF THE CONCEPT OF ‘ORIGINATING PRODUCTS’

Article 2

General requirements

1.
For the purpose of implementing the trade cooperation
provisions of the Decision, the following products shall be
considered as originating in the OCT:

(a) products wholly obtained in the OCT within the meaning

of Article 3 of this Annex;

(b) products obtained in the OCT incorporating materials
which have not been wholly obtained there, provided that
such materials have undergone sufficient working or
processing in the OCT within the meaning of Article 4 of
this Annex.

2.
For the purpose of implementing paragraph 1, the terri-
tories of the OCT shall be considered as being one territory.

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Originating products made up of materials wholly
3.
obtained or sufficiently worked or processed in two or more
OCT shall be considered as products originating in the OCT
where the last working or processing took place, provided this
working or processing goes beyond that referred to in Article 5
of this Annex.

Article 3

Wholly obtained products

(d) of which at least 50 % of the crew, master and officers
included, are OCT, Member State, or ACP nationals.

3.
Notwithstanding the provisions of paragraph 2, where an
OCT offers the Community the opportunity to negotiate a
fisheries agreement and the Community does not accept this
offer, the OCT concerned may charter or lease third country
vessels to undertake fisheries activities in its exclusive economic
zone and request that such vessels be treated as ‘their vessels’
under the following conditions:

— that the OCT offered the Community the opportunity to
negotiate a fisheries agreement and the Community did not
accept this offer;

The following shall be considered as wholly obtained, in

1.
the OCT,

in the Community, or in the ACP States:

— that at least 50 % of the crew, master and officers included

(a) mineral products extracted from their soil or from their

seabed;

(b) vegetable products harvested there;

(c) live animals born and raised there;

(d) products from live animals raised there;

(e) products obtained by hunting or fishing conducted there;

(f) products of sea fishing and other products taken from the

sea outside the territorial waters by their vessels;

are OCT, Member State, or ACP nationals;

— that the charter or lease contract has been accepted by the
Commission as providing adequate opportunities for devel-
oping the capacity of the OCT concerned to fish on its own
account and in particular as conferring on the OCT
concerned the responsibility for the nautical and commer-
cial management of the vessel placed at its disposal for a
significant period of time.

Article 4

(g) products made aboard their factory ships exclusively from

Sufficiently worked or processed products

products referred to in subparagraph (f);

(h) used articles collected there fit only for the recovery of raw
materials, including used tyres fit only for retreading or for
use as waste;

(i) waste and scrap resulting from manufacturing operations

conducted there;

(j) products extracted from marine soil or subsoil outside the
territorial waters provided that they have sole rights to
work that soil or subsoil;

(k) goods produced there exclusively from the products speci-

fied in subparagraphs (a) to (j).

2.
The terms ‘their vessels’ and ‘their factory ships’ in para-
graph 1(f) and (g) shall apply only to vessels and factory ships:

(a) which are registered or recorded in an OCT, in a Member

State or in an ACP State;

(b) which sail under the flag of an OCT, of a EC Member State

or of an ACP State;

(c) which are owned to an extent of at least 50 per cent by
OCT, Member State or ACP nationals, or by a company
with its head office in the OCT or one of these States, of
which Chairman of the Board of Directors or the Super-
visory Board, and the majority of the members of such
boards are OCT, Member State, or ACP nationals and of
which, in addition, in the case of partnerships or limited
companies, at least half the capital belongs to Member
States or ACP States or to public bodies or nationals of the
said States, or of an OCT;

1.
For the purposes of this Annex, products which are not
wholly obtained are considered to be sufficiently worked or
processed in the OCT, in the Community or in the ACP States,
when the conditions set out in the list in Appendix 2 are
fulfilled.

The conditions referred to above indicate,
for all products
covered by this Decision, the working or processing which
must be carried out on non-originating materials used in
manufacturing and apply only in relation to such materials.
Accordingly, it follows that if a product, which has acquired
originating status by fulfilling the conditions set out in the list
is used in the manufacture of another product, the conditions
applicable to the product in which it is incorporated do not
apply to it, and no account shall be taken of the non-origin-
ating materials which may have been used in its manufacture.

Notwithstanding paragraph 1, non-originating materials
2.
which, according to the conditions set out in the list, should
not be used in the manufacture of a given product may never-
theless be used, provided that:

(a) their total value does not exceed 15 per cent of the ex-

works price of the product;

(b) any of the percentages given in the list for the maximum
value of non-originating materials are not exceeded through
the application of this paragraph.

Paragraphs 1 and 2 shall apply except as provided in

3.
Article 5.

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Article 5

Insufficient working or processing operations

1. Without prejudice to paragraph 2, the following opera-
tions shall be considered as insufficient working or processing
to confer the status of originating products, whether or not the
requirements of Article 4 are satisfied:

(a) preserving operations to ensure that the products remain

in good condition during transport and storage;

(b) breaking-up and assembly of packages;

(c) washing, cleaning; removal of dust, oxide, oil, paint or

other coverings;

(d) ironing or pressing of textiles;

(e) simple painting and polishing operations;

(f) husking, partial or total milling, polishing, and glazing of

cereals and rice;

(g) operations to colour sugar or form sugar lumps; partial or

total milling of sugar;

(h) peeling, stoning and shelling, of fruits, nuts and vegetables;

(i) sharpening, simple grinding or simple cutting;

(j) sifting, screening, sorting, classifying, grading, matching;

(including the making-up of sets of articles);

(k) simple placing in bottles, cans, flasks, bags, cases, boxes,
fixing on cards or boards and all other simple packaging
operations;

(l) affixing or printing marks,

labels,

logos and other like

distinguishing signs on products or their packaging;

(m) simple mixing of products, whether or not of different
kinds, where one or more components of the mixtures do
not meet the conditions laid down in this Annex to enable
them to be considered as originating in the OCT, in the
Community or in an ACP State;

Article 6

Cumulation of origin

1. Materials originating in the Community or in the ACP
States shall be considered as materials originating in the OCT
when incorporated into a product obtained there. It shall not
be necessary that such materials have undergone sufficient
working or processing, provided they have undergone working
or processing going beyond that referred to in Article 5.

2. Working and processing carried out in the Community or
in the ACP States shall be considered as having been carried
out
in the OCT, when the materials undergo subsequent
working or processing in the OCT.

3.
Products which have acquired originating status by virtue
of paragraph 2 shall only continue to be considered as prod-
ucts originating in the OCT, when the working or processing
carried out in the OCT goes beyond that referred to in Article
5.

4.
Paragraphs 1 and 2 shall not apply to the products falling
within Chapters 1 to 24 of the Harmonised System if the
materials used originate in the Community and are covered by
an export refund system for agricultural products, unless
evidence is provided that no export refund has been paid for
the materials used.

With regard to products falling within HS Chapter 17 and HS
tariff headings 1806 10 30 and 1806 10 90, ACP/EC-OCT
cumulation of origin shall only be allowed as from 1 February
2002 within an annual quantity of 28 000 tonnes until 31
December 2007. Such annual quantity shall be progressively
reduced and eventually phased out, as follows:

21 000 tonnes on 1 January 2008;

14 000 tonnes on 1 January 2009;

7 000 tonnes on 1 January 2010;

zero tonnes on 1 January 2011.

Such annual quantities may not be carried over from one year
to the next.

(n) simple assembly of parts of articles

to constitute a
complete article or disassembly of products into parts;

For the purpose of implementing the rules on cumulation of
origin, forming sugar lumps or cubes and milling of sugar shall
be considered as sufficient to confer OCT-originating status.

(o) a combination of two or more operations specified in

subparagraphs (a) to (n);

The Commission shall adopt
arrangements.

the necessary implementing

(p) slaughter of animals.

2.
All the operations carried out in either the OCT, the
Community or the ACP States on a given product shall be
considered together when determining whether the working or
processing undergone by that product is to be regarded as
insufficient within the meaning of paragraph 1.

5. With regard to products falling within HS code 1006 and
without prejudice to the possible increases referred to in
subparagraphs 4 and 5, ACP-OCT cumulation of origin shall
only be allowed as from 1 February 2002 within a total annual
quantity of 160 000 tonnes expressed as husked rice equiva-
lent, which shall include the tariff quota for rice originating in
ACP States provided for in the ACP-EC Partnership Agreement.

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An initial issue of import licences for a quantity of 35 000
tonnes expressed as husked rice equivalent shall be made to the
OCTs each year, and within this quantity, import licences for a
quantity of 10 000 tonnes expressed as husked rice equivalent
shall be issued to the least developed OCTs listed in Annex IB.
All other import licences shall be issued to the Netherlands
Antilles and Aruba. OCT imports may reach the level of
160 000 tonnes referred to in the first subparagraph, including
the abovementioned 35 000 tonnes, without prejudice to any
increases referred to in subparagraphs 4 and 5, in so far as the
ACP States do not actually use their direct export possibilities
under the quota referred to in the first subparagraph.

The issue of import licences shall be spaced out over the year
in a series of periods laid down to ensure balanced market
management.

In accordance with the procedure laid down in Article 22 of
Regulation (EC) No 3072/95, the Commission may increase the
quantity referred to in the first subparagraph by a maximum of
20 000 tonnes expressed as husked rice equivalent if, during
April and once it has a sufficiently clear view of the current
Community marketing year, it finds that such an increase will
not disrupt the Community market.

If the Commission finds, as from 1 August, that there is an
established risk of a shortage of Indica rice on the Community
market, it may, by way of derogation from subparagraphs 1 to
4 and in accordance with the applicable management proced-
ures,

increase the above quantities.

For the purposes of implementing this paragraph and notwith-
standing Article 5(1)(f), wholly milling or semi-milling opera-
tions shall be considered as sufficient to confer the status of
OCT-originating products.

The Commission shall adopt
arrangements by the same procedure.

the necessary implementing

The quantities set out in this paragraph may not be carried
over from one year to the next.

Article 7

Unit of qualification

1.
The unit of qualification for the application of the provi-
sions of this Annex shall be the particular product which is
considered as the basic unit when determining classification
using the nomenclature of the Harmonised System.

Accordingly,

it follows that:

(a) when a product composed of a group or assembly of
articles is classified under the terms of the Harmonised
System in a single heading, the whole constitutes the unit
of qualification;

(b) when a consignment consists of a number of

identical
products classified under the same heading of the Harmo-
nised System, each product must be taken individually
when applying the provisions of this Annex.

2. Where, under General Rule 5 of the Harmonised System,
for classification
packaging is
purposes, it shall be included for the purposes of determining
origin.

included with the product

Article 8

Accessories, spare parts and tools

Accessories, spare parts and tools dispatched with a piece of
equipment, machine, apparatus or vehicle, which are part of
the normal equipment and included in the price thereof or
which are not separately invoiced, shall be regarded as one
with the piece of equipment, machine, apparatus or vehicle in
question.

Article 9

Sets

Sets, as defined in General Rule 3 of the Harmonised System,
shall be regarded as originating when all component products
are originating. Nevertheless, when a set is composed of origin-
ating and non-originating products, the set as a whole shall be
regarded as originating, provided that the value of the non-
originating products does not exceed 15 per cent of the ex-
works price of the set.

Article 10

Neutral elements

In order to determine whether a product originates, it shall not
be necessary to determine the origin of the following which
might be used in its manufacture:

(a) energy and fuel;

(b) plant and equipment;

(c) machines and tools;

(d) goods which do not enter and which are not intended to

enter into the final composition of the product.

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TITLE III

(c) failing these, any substantiating documents.

TERRITORIAL REQUIREMENTS

Article 11

Principle of territoriality

1.
The conditions set out in Title II relative to the acquisi-
tion of originating status must be fulfilled without interruption
in the OCT, except as provided for in Article 6.

If originating goods

exported from the OCT,

the
2.
Community, or the ACP States 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:

(a) the goods returned are the same goods as those exported;

(b) they have not undergone any operation beyond that neces-
sary to preserve them in good condition while in that
country or while being exported.

Article 12

Direct transport

1.
The preferential treatment provided for under the trade
cooperation provisions of the Decision applies only to prod-
ucts, satisfying the requirements of
this Annex, which are
transported directly between the territories of the OCT, of the
Community, or of the ACP States, without entering any other
territory. However, products constituting one single consign-
ment may be transported through other territories with, should
the occasion arise, transhipment or temporary warehousing in
such territories, provided that they remain under the surveil-
lance of the customs authorities in the country of transit or
than
warehousing and do not undergo operations other
unloading, reloading or any operation designed to preserve
them in good condition.

Originating products may be transported by pipeline across
territory other than that of an OCT, of the Community, or of
an ACP State.

2.
Evidence that the conditions set out in paragraph 1 have
been fulfilled shall be supplied to the customs authorities of the
importing country by the production of:

(a) a single transport document covering the passage from the
exporting country or territory through the country of
transit; or

(b) a certificate issued by the customs authorities of

the

country of transit:

(i) giving an exact description of the products;

(ii) stating the dates of unloading and reloading of the
products and, where applicable, the names of the ships,
or the other means of transport used;

(iii) certifying the conditions under which the products

remained in the transit country; or

Article 13

Exhibitions

1.
Originating products, sent from an OCT for exhibition in
a country other than an OCT, an ACP State or a Member State
and sold after the exhibition for importation in the Community
shall benefit on importation from the provisions of
the
Decision provided it is shown to the satisfaction of the customs
authorities that:

(a) an exporter has consigned these products from an OCT to
the country in which the exhibition is held and has exhib-
ited them there;

(b) the products have been sold or otherwise disposed of by

that exporter to a person in the Community;

(c) the products have been consigned during the exhibition or
immediately thereafter in the state in which they were sent
for exhibition;

(d) the products have not, since they were consigned for
exhibition, been used for any purpose other than demon-
stration at the exhibition.

2.
A proof of origin must be issued or made out in accord-
ance with the provisions of Title IV and submitted to the
customs authorities of the importing country in the normal
manner. The name and address of the exhibition must be
indicated thereon. Where necessary, additional documentary
evidence of the conditions under which they have been exhib-
ited may be required.

3.
Paragraph 1 shall apply to any trade, industrial, agricul-
tural or crafts exhibition, fair or similar public show or display
which is not organised for private purposes in shops or busi-
ness premises with a view to the sale of foreign products, and
during which the products remain under customs control.

TITLE IV

PROOF OF ORIGIN

Article 14

General requirements

1.
Products originating in the OCT shall, on importation
into the Community benefit from this Decision upon submis-
sion of either:

(a) a movement certificate EUR.1, a specimen of which appears

in Appendix 3; or

(b) in the cases specified in Article 19(1), a declaration, the text
of which appears in Appendix 4, given by the exporter on
an invoice, a delivery note or any other commercial docu-
ment which describes the products concerned in sufficient
detail to enable them to be identified (hereinafter referred to
as the ‘invoice declaration’).

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Notwithstanding paragraph 1, originating products
2.
within the meaning of this Annex shall, in the cases specified in
Article 25, benefit from this Decision without it being neces-
sary to submit any of the documents referred to above.

Article 15

Procedure for the issue of a movement certificate EUR.1

1.
A movement certificate EUR.1 shall be issued by the
the exporting OCT on application
customs authorities of
having been made in writing by the exporter or, under the
exporter's responsibility, by his authorised representative.

For this purpose, the exporter or his authorised repres-
2.
entative shall fill out both the movement certificate EUR.1 and
the application form, specimens of which appear in Appendix
3. These forms shall be completed in accordance with the
provisions of this Annex. If they are hand-written, they shall be
completed in ink in printed characters. The description of the
products must be given in the box reserved for this purpose
without
leaving any blank lines. Where the box is not
completely filled, a horizontal line must be drawn below the
last line of the description, the empty space being crossed
through.

3.
The exporter applying for the issue of a movement certif-
icate EUR.1 shall be prepared to submit at any time, at the
request of the customs authorities of the exporting OCT where
the movement certificate EUR.1 is issued, all appropriate docu-
ments proving the originating status of the products concerned
as well as the fulfilment of the other requirements of this
Annex.

A movement certificate EUR.1 shall be issued by the
4.
customs authorities of
the products
concerned can be considered as products originating in the
OCT, in the Community or in the ACP and fulfil the other
requirements of this Annex.

the exporting OCT if

Article 16

Movement certificates EUR.1 issued retrospectively

Notwithstanding Article 15(7), a movement certificate
1.
EUR.1 may exceptionally be issued after exportation of the
products to which it relates if:

(a) it was not issued at the time of exportation because of
errors or involuntary omissions or special circumstances; or

(b) it is demonstrated to the satisfaction of the customs author-
ities that a movement certificate EUR.1 was issued but was
not accepted at importation for technical reasons.

2.
For the implementation of paragraph 1, the exporter
must indicate in his application the place and date of exporta-
tion of the products to which the movement certificate EUR.1
relates, and state the reasons for his request.

3.
The customs authorities may issue a movement certificate
EUR.1 retrospectively only after verifying that the information
supplied in the exporter's application agrees with that in the
corresponding file.

4. Movement certificates EUR.1 issued retrospectively must
be endorsed with one of the following phrases in the ‘Remarks’
box (Box 7) of the movement certificate EUR.1.

«EXPEDIDO A POSTERIORI» , »UDSTEDT EFTERFØLGENDE« ,
« ΕΚ∆ΟΘΕΝ ΕΚ ΤΩΝ
„NACHTRÄGLICH AUSGESTELLT“
ΥΣΤΕΡΩΝ»
«DÉLIVRÉ A
POSTERIORI» , «RILASCIATO A POSTERIORI» , „AFGEGEVEN
A POSTERIORI” , «EMITIDO A POSTERIORI» , ”ANNETTU
JÄLKIKÄTEEN” , ”UTFÄRDAT I EFTERHAND”.

‘ISSUED RETROSPECTIVELY’

,

,

,

The endorsement referred to in paragraph 4 shall be
the movement certificate

5.
inserted in the ‘Remarks’ box of
EUR.1.

Article 17

The issuing customs authorities shall

5.
take any steps
necessary to verify the originating status of the products and
the fulfilment of the other requirements of this Annex. For this
purpose, they shall have the right to call for any evidence and
to carry out any inspection of the exporter's accounts or any
other check considered appropriate. The issuing customs
authorities shall also ensure that the forms referred to in para-
graph 2 are duly completed. In particular, they shall check
whether the space reserved for the description of the products
has been completed in such a manner as to exclude all poss-
ibility of fraudulent additions.

Issue of a duplicate movement certificate EUR.1

In the event of theft, loss or destruction of a movement
1.
certificate EUR.1,
the exporter may apply to the customs
authorities which issued it for a duplicate made out on the
basis of the export documents in their possession.

The duplicate movement certificate EUR.1 shall be
the

2.
endorsed in the ‘Remarks’ box (Box 7) with one of
following words:

The date of issue of the movement certificate EUR.1 shall

6.
be indicated in Box 11 of the certificate.

‘DUPLICADO’,
‘DUPLICATA’,
‘KAKSOISKAPPALE’.

‘DUPLIKAT’,
‘DUPLICATO’,

‘ΑΝΤΙΓΡΑΦΟ’,

‘DUPLICAAT’,

‘DUPLICATE’,
‘SEGUNDA VIA’,

7.
A movement certificate EUR.1 shall be issued by the
customs authorities and made available to the exporter as soon
as actual exportation has been effected or ensured.

3.
The endorsement referred to in paragraph 2 shall be
inserted in the ‘Remarks’ box of the duplicate movement certifi-
cate EUR.1.

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The duplicate, which must bear the date of issue of the
4.
original movement certificate EUR.1, shall take effect as from
that date.

country no longer than two years after the importation of the
products to which it relates.

Article 18

Issue of movement certificates EUR.1 on the basis of a
proof of origin issued or made out previously

When originating products are placed under the control of a
customs office in the Community or in an OCT, it shall be
possible to replace the original proof of origin by one or more
movement certificates EUR.1 for the purpose of sending all or
some of these products elsewhere within the Community or
within the OCT. The replacement movement certificate(s)
EUR.1 shall be issued by the customs office under whose
control the products are placed.

Article 19

Conditions for making out an invoice declaration

Article 20

Approved exporter

1.
The customs authorities of the exporting country may
authorise any exporter who makes frequent shipments of prod-
ucts under the trade cooperation provisions of the Decision to
make out invoice declarations irrespective of the value of the
products concerned. An exporter seeking such authorisation
must offer to the satisfaction of the customs authorities all
guarantees necessary to verify the originating status of the
products as well as the fulfilment of the other requirements of
this Annex.

2.
The customs authorities may grant the status of approved
exporter subject to any conditions which they consider appro-
priate.

The customs authorities shall grant

3.
to the approved
exporter a customs authorisation number which shall appear
on the invoice declaration.

An invoice declaration as referred to in Article 14(1)(b)

1.
may be made out:

The customs authorities shall monitor the use of the

4.
authorisation by the approved exporter.

(a) by an approved exporter within the meaning of Article 20,

or

(b) by any exporter for any consignment consisting of one or
more packages containing originating products whose total
value does not exceed EUR 6 000.

2.
An invoice declaration may be made out if the products
concerned can be considered as products originating in the
OCT, in the ACP States or in the Community and fulfil the
other requirements of this Annex.

3.
The exporter making out an invoice declaration shall be
prepared to submit at any time, at the request of the customs
authorities of the exporting country or territory, all appropriate
the products
documents proving the originating status of
concerned as well as the fulfilment of the other requirements of
this Annex.

An invoice declaration shall be made out by the exporter
4.
by typing, stamping or printing on the invoice, the delivery
note or another commercial document, the declaration, the text
of which appears in Appendix 4, using one of the linguistic
versions set out in that Annex and in accordance with the
provisions of the domestic law of the exporting country or
territory. If the declaration is hand-written, it shall be written in
ink in printed characters.

Invoice declarations shall bear the original signature of
5.
the exporter in manuscript. However, an approved exporter
within the meaning of Article 20 shall not be required to sign
such declarations provided that he gives the customs authori-
ties of the exporting country a written undertaking that he
accepts full responsibility for any invoice declaration which
identifies him as if it had been signed in manuscript by him.

6.
An invoice declaration may be made out by the exporter
when the products to which it relates are exported, or after
exportation on condition that it is presented in the importing

The customs authorities may withdraw the authorisation
5.
at any time. They shall do so where the approved exporter no
longer offers the guarantees referred to in paragraph 1, does
not fulfil the conditions referred to in paragraph 2 or otherwise
makes an incorrect use of the authorisation.

Article 21

Validity of proof of origin

1.
A proof of origin shall be valid for ten months from the
date of issue in the exporting country, and must be submitted
within the said period to the customs authorities of
the
importing country.

2.
Proofs of origin which are submitted to the customs
authorities of the importing country after the final date for
presentation specified in paragraph 1 may be accepted for the
purpose of applying preferential treatment, where the failure to
submit these documents by the final date set is due to excep-
tional circumstances.

In other cases of belated presentation,

3.
the customs
authorities of the importing country may accept the proofs of
origin where the products have been submitted before the said
final date.

Article 22

Transit procedure

When the products enter an OCT or an ACP State other than
the country of origin, a further period of validity of 4 months
shall commence on the date on which the customs authorities
in the country of transit enter the following in the Remarks
box (Box 7) of the certificate EUR.1:
— the word ‘transit’,
— the name of the country of transit,

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— the official stamp, a specimen of which had been made
available to the Commission, in conformity with Article 31,

— date of the endorsements.

Article 23

Submission of proof of origin

Proofs of origin shall be submitted to the customs authorities
of the importing country in accordance with the procedures
applicable in that country. The said authorities may require a
translation of a proof of origin and may also require the import
declaration to be accompanied by a statement
from the
importer to the effect that the products meet the conditions
required for the implementation of the Decision.

Article 24

Importation by instalments

Where, at the request of the importer and on the conditions
laid down by the customs authorities of the importing country,
dismantled or non-assembled products within the meaning of
General Rule 2(a) of the Harmonised System falling within
Sections XVI and XVII or heading Nos 7308 and 9406 of the
Harmonised System are imported by instalments, a single proof
of origin for such products shall be submitted to the customs
authorities upon importation of the first instalment.

Article 25

Exemptions from proof of origin

1.
Products sent as small packages from private persons to
private persons or forming part of travellers' personal luggage
shall be admitted as originating products without requiring the
submission of a proof of origin, provided that such products
are not imported by way of trade and have been declared as
meeting the requirements of this Annex and where there is no
doubt as to the veracity of such a declaration. In the case of
products sent by post, this declaration can be made on the
customs declaration CN22/CN23 or on a sheet of paper
annexed to that document.

2.
Imports which are occasional and consist solely of prod-
ucts for the personal use of the recipients or travellers or their
families shall not be considered as imports by way of trade if it
is evident from the nature and quantity of the products that no
commercial purpose is in view.

3.
Furthermore, the total value of these products shall not
exceed 500 EUR in the case of small packages or 1 200 EUR
in the case of products forming part of travellers' personal
luggage.

Article 26

Information procedure for cumulation purposes

the
1. When Article 2(2) or Article 6(1) are applied,
this
evidence of originating status within the meaning of
Annex of
the
the materials coming from the other OCT,
Community or the ACP States shall be given by a movement
certificate EUR.1 or by the supplier's declaration, a specimen of
which appears in Appendix 5 A, given by the exporter in the
country from which the materials came.

the
2. When Article 2(2) or Article 6(2) are applied,
evidence of the working or processing carried out in the other
OCT, the Community or in the ACP States shall be given by
the supplier's declaration a specimen of which appears in
Appendix 5 B, given by the exporter in the country from
which the materials came.

3.
A separate supplier's declaration shall be given by the
supplier for each consignment of material on the commercial
invoice related to that shipment or in an annex to that invoice,
or on a delivery note or other commercial document related to
that shipment which describes the materials concerned in suffi-
cient detail to enable them to be identified.

The supplier's declaration may be made out on a pre-

4.
printed form.

5.
The suppliers' declarations shall be signed in manuscript.
However, where the invoice and the supplier's declaration are
established using electronic data-processing methods,
the
supplier's declaration need not be signed in manuscript
provided the responsible official in the supplying company is
identified to the satisfaction of the customs authorities in the
country or territory where the suppliers' declarations are estab-
lished. The said customs authorities may lay down conditions
for the implementation of this paragraph.

The

supplier's

6.
to the
competent customs office in the exporting OCT requested to
issue the movement certificate EUR.1.

declarations

submitted

are

7.
Suppliers' declarations made and information certificates
issued before the date of entry into force of this Decision in
accordance with Article 23 of Annex II
to Decision 91/
482/EEC shall remain valid.

8.
For the purpose of Article 6(4), first subparagraph, the
movement certificate EUR.1 shall be endorsed with one of the
following phrases in the ‘Remarks’ box (Box 7) of the move-
ment certificate EUR.1:

«RESTITUCIÓN A LA EXPORTACIÓN NO PAGADA»,
»EKSPORTRESTITUTION IKKE UDBETALT«,
„KEINE AUS-
FUHRERSTATTUNG GEZAHLT“,
«∆ΕΝ ΚΑΤΕΒΛΗΘΗ ΚΑΤΑ
‘EXPORT REFUND NOT PAID’, «RESTITU-
ΤΗΝ ΕΞΑΓΩΓΗ»,
TION À L'EXPORTATION NON PAYÉE»,
«RESTITUZIONE
ALL'ESPORTAZIONE NON CORRISPOSTA», „GEEN UITVOER-
«RESTITUIÇÕES À EXPORTAÇÃO
RESTITUTIE BETAALD”,
NÃO PAGAS»,
”EXPORT-
STÖD EJ UTBETALAT”.

”EI MAKSETTU VIENTITUKEA”,

Article 27

Supporting documents

The documents referred to in Article 15(3) and Article 19(3)
used for the purpose of proving that products covered by a
movement certificate EUR.1 or an invoice declaration can be
considered as products originating in an OCT or in the
Community or in an ACP and fulfil the other requirements of
this Annex may consist inter alia of the following:

(a) direct evidence of the processes carried out by the exporter
or supplier to obtain the goods concerned, contained for
example in his accounts or internal bookkeeping;

(b) documents proving the originating status of materials used,
issued or made out in an OCT, or in the Community or in
an ACP State where these documents are used in accord-
ance with domestic law;

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(c) documents proving the working or processing of materials
in the OCT, in the Community, or in the ACP States, issued
or made out in an OCT, in the Community or in an ACP
State, where these documents are used in accordance with
domestic law;

(d) movement

certificates EUR.1 or

invoice declarations
proving the originating status of materials used, issued or
made out in the OCT, in the Community or in the ACP
States and in accordance with this Annex.

Article 28

Preservation of proof of origin and supporting documents

1.
The exporter applying for the issue of a movement certif-
icate EUR.1 shall keep for at least three years the documents
referred to in Article 15(3).

2.
The exporter making out an invoice declaration shall
keep for at least three years a copy of this invoice declaration
as well as the documents referred to in Article 19(3).

3.
The customs authorities of the exporting OCT issuing a
movement certificate EUR.1 shall keep for at least three years
the application form referred to in Article 15(2).

4.
The customs authorities of the importing country shall
keep for at least three years the movement certificates EUR.1
and the invoice declarations submitted to them.

Article 29

Discrepancies and formal errors

1.
The discovery of slight discrepancies between the state-
ments made in the proof of origin and those made in the
documents submitted to the customs office for the purpose of
carrying out the formalities for importing the products shall
not ipso facto render the proof of origin null and void if it is
duly established that this document does correspond to the
products submitted.

2.
Obvious formal errors such as typing errors on a proof of
origin should not cause this document to be rejected if these
errors are not such as to create doubts concerning the correct-
ness of the statements made in this document.

Article 30

Amounts expressed in euro

The amounts to be used in any given national currency of
1.
a Member State shall be the equivalent
in that national
currency of the amounts expressed in euro as at the first
working day in October 1999.

2.
The amounts expressed in euro and their equivalents in
the national currencies of some Member States shall be
reviewed by the Customs Code Committee (Origin Section) at

the request of the Commission, a Member State or of the OCT.
When carrying out this review, the Committee shall ensure that
there will be no decrease in the amounts to be used in any
national currency and shall furthermore consider the desir-
ability of preserving the effects of the limits concerned in real
terms. For this purpose, it may decide to modify the amounts
expressed in euro.

3. When the products are invoiced in the currency of
another Member State, the importing country shall recognise
the amount notified by the Member State concerned.

TITLE V

ARRANGEMENTS FOR ADMINISTRATIVE COOPERATION

Article 31

Communication of stamps and addresses

The OCT shall send to the Commission specimens of the
stamps used together with the addresses of the customs author-
ities competent to issue movement certificates EUR.1 and carry
out the subsequent verification of movement certificates EUR.1
and invoice declarations.

Movement certificates EUR.1 shall be accepted for the purpose
of applying preferential treatment from the date the informa-
tion is received by the Commission.

The Commission shall send this information to the customs
authorities of the Member States.

Article 32

Verification of proofs of origin

through the competent customs administrations,

In order to ensure the proper application of this Annex,
1.
the OCT, the Community and the ACP States shall assist each
other,
in
checking the authenticity of the movement certificates EUR.1
or the invoice declarations and the correctness of the informa-
tion given in these documents.

The authorities consulted shall furnish the relevant information
concerning the conditions under which the product has been
made, indicating especially the conditions in which the rules of
origin have been respected in the various OCT, Member States
or ACP States concerned.

Subsequent verifications of proofs of origin shall be
2.
carried out at random or whenever the customs authorities of
the importing country have reasonable doubts as to the
authenticity of such documents, the originating status of the
products concerned or the fulfilment of the other requirements
of this Annex.

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For the purposes of implementing the provisions of para-
3.
graph 2, the customs authorities of the importing country shall
return the movement certificate EUR.1 and the invoice, if it has
been submitted, the invoice declaration, or a copy of these
documents, to the customs authorities of the exporting country
giving, where appropriate, the reasons for the enquiry. Any
documents and information obtained suggesting that the infor-
mation given on the proof or origin is incorrect shall be
forwarded in support of the request for verification.

4.
The verification shall be carried out by the customs
authorities of the exporting country. For this purpose, they
shall have the right to call for any evidence and to carry out
any inspection of the exporter's accounts or any other check
considered appropriate.

If

the customs authorities of

5.
the importing country
decide to suspend the granting of preferential treatment to the
products concerned while awaiting the results of the verifica-
tion, release of the products shall be offered to the importer
subject to any precautionary measures judged necessary.

the results of

The customs authorities requesting the verification shall
6.
be informed of
this verification as soon as
possible. These results must indicate clearly whether the docu-
ments are authentic and whether the products concerned can
be considered as products originating in the OCT,
in the
Community or in the ACP and fulfil the other requirements of
this Annex.

7.
If in cases of reasonable doubt there is no reply within
ten months of the date of the verification request or if the reply
does not contain sufficient
information to determine the
authenticity of the document in question or the real origin of
the products, the requesting customs authorities shall, except in
exceptional circumstances, refuse entitlement
to the prefer-
ences.

8. Where the verification procedure or any other available
information appears to indicate that the provisions of this
Annex are being contravened, the OCT on its own initiative or
at the request of the Community shall carry out appropriate
enquires or arrange for such enquiries to be carried out with
due urgency to identify and prevent such contraventions. The
Commission may participate in the enquiries.

Article 33

Verification of suppliers' declarations

random or whenever

Verification of suppliers' declaration may be carried out
1.
at
the
importing country have reasonable doubts as to the authen-
ticity of the document or the accuracy or completeness of the
information concerning the true origin of the materials in
question.

the customs authorities of

is submitted may request the exporter to produce an informa-
tion certificate issued by the customs authorities of the State
where the declaration was made.

A copy of the information certificate shall be preserved by the
office which has issued it for at least three years.

3.
The requesting customs authorities shall be informed of
the results of the verification as soon as possible. The results
must be such as to indicate positively whether the declaration
concerning the status of the materials is correct.

4.
For the purpose of verification, suppliers shall keep for
not less than three years a copy of the document containing
the declaration together with all necessary evidence showing
the true status of the materials.

5.
The customs authorities in the State where the supplier's
declaration is established shall have the right to call for any
evidence or to carry out any check which they consider appro-
priate in order to verify the correctness of any supplier's
declaration.

Any movement certificate EUR.1 issued or made out on
6.
the basis of an incorrect supplier's declaration shall be consid-
ered null and void.

Article 34

Dispute settlement

Where disputes arise in relation to the verification procedures
of Articles 32 and 33 which cannot be settled between the
customs authorities requesting a verification and the customs
authorities responsible for carrying out
this verification or
where they raise a question as to the interpretation of this
they shall be submitted to the Customs Code
Annex,
Committee — Origin Section instituted by Regulation (EEC) No
2913/92.

In all cases the settlement of disputes between the importer and
the customs authorities of the importing country shall be under
the legislation of the said country.

Article 35

Penalties

Penalties shall be imposed on any person who draws up, or
causes to be drawn up, a document which contains incorrect
information for the purpose of obtaining a preferential treat-
ment for products.

Article 36

Free zones

2.
The customs authorities to which a supplier's declaration
is submitted may request the customs authorities of the State
where the declaration was made to issue an information certifi-
cate, a specimen of which appears in Appendix 6. Alterna-
tively, the customs authorities to which a supplier's declaration

The OCT and the Member States shall take all necessary
1.
steps to ensure that products traded under cover of a proof of
origin or a supplier's declaration and which in the course of
transport use a free zone situated in their territory, are not
substituted by other goods and do not undergo handling other
than normal operations designed to prevent their deterioration.

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By means of an exemption to the provisions contained in
2.
paragraph 1, when originating products are imported into a
free zone under cover of a proof of origin and undergo treat-
ment or processing, the authorities concerned shall issue a new
EUR.1 certificate at the exporter's request, if the treatment or
processing undergone is in conformity with the provisions of
this Annex.

Article 37

Derogations

Derogations from this Annex may be adopted where the
1.
development of existing industries or the creation of new
industries justifies them.

The Member State or, where appropriate, the OCT authorities
concerned shall notify the Community of its request for a
derogation together with the reasons for the request in accord-
ance with paragraph 2.

The Community shall respond positively to all the requests
which are duly justified in conformity with this Article and
which cannot
to an established
Community industry.

serious

injury

cause

2.
In order to facilitate the examination of requests for
derogation, the Member State or OCT making the request shall,
by means of the form given in Appendix 7, furnish in support
of its request the fullest possible information covering in partic-
ular the points listed below:

— description of the finished product,

— nature and quantity of materials originating in a third

country,

— nature and quantity of materials originating in ACP States,
the Community or the OCT, or which have been processed
there,

— manufacturing processes,

— value added,

— number of employees in the enterprise concerned,

— anticipated volume of exports to the Community,

— other possible sources of supply for raw materials,

— reasons for the duration requested in the light of efforts

made to find new sources of supply,

— other observations.

The same rules shall apply to any requests for extension.

The examination of requests shall in particular take into

3.
account:

(a) the level of development or the geographical situation of

the OCT concerned;

(b) cases where the application of the existing rules of origin
would significantly affect the ability of an existing industry
in OCT to continue its exports to the Community, with
particular reference to cases where this could lead to cessa-
tion of its activities;

(c) specific cases where it can be clearly demonstrated that
significant investment in an industry could be deterred by
the rules of origin and where a derogation favouring the
realisation of
the investment programme would enable
these rules to be satisfied by stages.

4.
In every case an examination shall be made to ascertain
whether the rules relating to cumulation of origin do not
provide a solution to the problem.

5.
In addition when a request for derogation concerns a
least-developed country or territory, its examination shall be
carried out with a favourable bias having particular regard to:

(a) the economic and social impact of the decision to be taken

especially in respect of employment;

(b) the need to apply the derogation for a period taking into
account the particular situation of the OCT concerned and
its difficulties.

6.
In the examination of requests, special account shall be
taken, case by case, of the possibility of conferring originating
status on products which include in their composition mate-
rials originating in neighbouring developing countries or least-
developed countries, provided that satisfactory administrative
cooperation can be established.

7. Without prejudice to paragraphs 1 to 6, the derogation
shall be granted where the value added to the non-originating
products used in the OCT concerned is at least 45 % of the
value of the finished product, provided that the derogation is
not such as to cause serious injury to an economic sector of
the Community or of one or more Member States.

8.

(a) The Council and the Commission shall take steps neces-
sary to ensure that a decision is reached as quickly as
possible and in any case not later than 75 working days
after the request is received by the Chairman of the
Customs Code Committee — Origin Section.
In this
context, Council Decision 2000/399/EC (1) shall apply
mutatis mutandis.

(b) If a decision is not taken within the time limit referred
to in subparagraph (a), the request shall be deemed to
have been accepted.

9.

(a) The derogation shall be valid for a period, generally of

five years.

(b) The derogation decision may provide for

renewals
without a new decision of the Commission being neces-
sary, provided that the Member State or OCT concerned
submits, three months before the end of each period,
proof that it is still unable to meet the conditions of this
Annex which have been derogated from.

If any objection is made to the extension, the Commission
shall examine it as soon as possible and decide whether to
prolong the derogation. The Commission shall proceed as
provided for in paragraph 8. All necessary measures shall be
the
taken to avoid interruptions in the application of
derogation.

(1) Council Decision of 16 June 2000 on the procedure concerning
derogations from the rules of origin set out in Protocol No 1 to
the ACP-EC Partnership Agreement (OJ L 151, 24.6.2000, p. 16).

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(c) In the periods referred to in subparagraphs (a) and (b),
the Community may review the terms for implementing
the derogation should a significant change be found to
have taken place in the substantive factors governing the
decision to grant the derogation. On conclusion of its
review the Community may decide to amend the terms
of its decision as regards the scope of derogation or any
other condition previously laid down.

TITLE VI

CEUTA AND MELILLA

Article 38

Special conditions

1.
The term ‘Community’ used in this Annex shall not cover
Ceuta and Melilla. The term ‘products originating in the
Community’ shall not cover products originating in Ceuta and
Melilla.

2.
The provisions of this Annex shall apply mutatis mutandis
in determining whether products may be deemed as originating
in the OCT when imported into Ceuta and Melilla.

3. Where products wholly obtained in Ceuta, Melilla, the
ACP States or the Community undergo working and processing
in the OCT, they shall be considered as having been wholly
obtained in the OCT.

4. Working or processing carried out in Ceuta, Melilla, the
ACP States or the Community shall be considered as having
been carried out in the OCT, when materials undergo further
working or processing in the OCT.

For the purpose of implementing paragraphs 3 and 4, the
5.
insufficient operations listed in Article 5 shall not be consid-
ered as working or processing.

6.

Ceuta and Melilla shall be considered as a single territory.

TITLE VII

FINAL PROVISIONS

Article 39

Revision of rules of origin

1.
The Council shall examine whenever the relevant authori-
ties of a country or territory or of the Community so request,
this Annex and their
the application of

the provisions of

economic effects with a view to making any necessary amend-
ments or adaptations.

The Council shall take into account among other elements the
effects on the rules of origin of technological developments.

The decisions taken shall be implemented as soon as possible.

Any technical amendments

2.
to this Annex shall be
adopted in accordance with the regulatory procedure laid down
in Article 5 of Council Decision 1999/468/EC of 28 June
1999. The Commission shall be assisted for such purpose by
the Customs Code Committee referred to in Article 247a of
Regulation (EEC) No 2913/92 (1), and the period laid down in
Article 5(6) of Decision 1999/468/EC shall be set at three
months. The afore-mentioned procedure shall not apply to
Article 6(4) and (5) of this Annex.

Article 40

Appendices

The Appendices to this Annex shall form an integral part
thereof.

Article 41

Implementation of the Annex

The Community and the OCT shall each take the steps neces-
sary to implement this Annex.

Article 42

Transitional period concerning the making out of forms
EUR.2

1.
Until 31 December 2002, the competent customs author-
ities of the Community shall accept as valid proof of origin
within the meaning of this Annex EUR.2 forms issued within
the context of this Decision.

2.
Requests for subsequent verification of EUR.2 forms shall
be accepted by the competent authorities of the exporting
countries for a period of two years after the making out of the
EUR.2 form concerned. These verifications shall be carried out
in accordance with Title V of this Annex.

(1) OJ L 302, 19.10.1992, p. 1. Regulation as last amended by Regula-

tion (EC) No 2700/2000 (OJ L 311, 12.12.2000, p. 17).

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Appendix 1

Introductory notes to the list in Appendix 2

N o t e 1 :

The list sets out the conditions required for all products to be considered as sufficiently worked or processed within the
meaning of Article 4 of Appendix 2.

N o t e 2 :

2.1. The first two columns in the list describe the product obtained. The first column gives the heading number or
chapter number used in the Harmonized System and the second column gives the description of goods used in that
system for that heading or chapter. For each entry in the first two columns a rule is specified in columns 3 or 4.
Where, in some cases, the entry in the first column is preceded by an ‘ex’, this signifies that the rules in columns 3 or
4 apply only to the part of that heading as described in column 2.

2.2. Where several heading numbers are grouped together in column 1 or a chapter number is given and the description
of products in column 2 is therefore given in general terms, the adjacent rules in columns 3 or 4 apply to all
products which, under the Harmonized System, are classified in headings of the chapter or in any of the headings
grouped together in column 1.

2.3. Where there are different rules in the list applying to different products within a heading, each indent contains the

description of that part of the heading covered by the adjacent rules in columns 3 or 4.

2.4. Where, for an entry in the first two columns, a rule is specified in both columns 3 and 4, the exporter may opt, as an
alternative, to apply either the rule set out in column 3 or that set out in column 4. If no origin rule is given in
column 4, the rule set out in column 3 has to be applied.

N o t e 3 :

3.1. The provisions of Article 4 of Annex III concerning products having acquired originating status which are used in
the manufacture of other products apply regardless of whether this status has been acquired inside the factory where
these products are used or in another factory in the Community or in the OCT.

Example:

An engine of heading No 8407, for which the rule states that the value of the non-originating materials which may
be incorporated may not exceed 40 per cent of the ex-works price, is made from ‘other alloy steel roughly shaped by
forging’ of heading No ex 7224.

If this forging has been forged in the country concerned from a non-originating ingot, it has already acquired
originating status by virtue of the rule for heading No ex 7224 in the list. The forging can then count as originating
in the value calculation for the engine regardless of whether it was produced in the same factory or in another
factory in the Community. The value of the non-originating ingot is thus not taken into account when adding up the
value of the non-originating materials used.

3.2. The rule in the list represents the minimum amount of working or processing required and the carrying out of more
working or processing also confers originating status; conversely, the carrying out of less working or processing
cannot confer originating status. Thus if a rule provides that non-originating material at a certain level of
manufacture may be used, the use of such material at an earlier stage of manufacture is allowed and the use of such
material at a later stage is not.

3.3. Without prejudice to Note 3.2 where a rule states that ‘materials of any heading’ may be used, materials of the same
heading as the product may also be used, subject, however, to any specific limitations which may also be contained
in the rule. However, the expression ‘manufacture from materials of any heading,
including other materials of
heading No...’ means that only materials classified in the same heading as the product of a different description than
that of the product as given in column 2 of the list may be used.

3.4. When a rule in the list specifies that a product may be manufactured from more than one material, this means that

any one or more materials may be used. It does not require that all be used.

Example:

The rule for fabrics of heading Nos 5208 to 5212 provides that natural fibres may be used and that chemical
materials, among other materials, may also be used. This does not mean that both have to be used; it is possible to
use one or the other or both.

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3.5. Where a rule in the list specifies that a product must be manufactured from a particular material, the condition
obviously does not prevent the use of other materials which, because of their inherent nature, cannot satisfy the rule.
(See also Note 6.2 and 6.3 below in relation to textiles).

Example:

The rule for prepared foods of heading No 1904 which specifically excludes the use of cereals and their derivatives
does not prevent the use of mineral salts, chemicals and other additives which are not products from cereals.

However, this does not apply to products which, although they cannot be manufactured from the particular
materials specified in the list, can be produced from a material of the same nature at an earlier stage of manufacture.

Example:

In the case of an article of apparel of ex Chapter 62 made from non-woven materials,
if the use of only
non-originating yarn is allowed for this class of article, it is not possible to start from non-woven cloth — even if
non-woven cloths cannot normally be made from yarn. In such cases, the starting material would normally be at the
stage before yarn — that is the fibre stage.

3.6. Where, in a rule in the list, two percentages are given for the maximum value of non-originating materials that can
be used, then these percentages may not be added together. In other words, the maximum value of all the
non-originating materials used may never exceed the highest of the percentages given. Furthermore, the individual
percentages must not be exceeded in relation to the particular materials they apply to.

N o t e 4 :

4.1. The term ‘natural fibres’ is used in the list to refer to fibres other than artificial or synthetic fibres. It is restricted to
the stages before spinning takes place, including waste, and, unless otherwise specified, includes fibres that have been
carded, combed or otherwise processed but not spun.

4.2. The term ‘natural fibres’ includes horsehair of heading No 0503, silk of heading Nos 5002 and 5003 as well as the
wool fibres, fine or coarse animal hair of heading Nos 5101 to 5105, the cotton fibres of heading Nos 5201 to 5203
and the other vegetable fibres of heading Nos 5301 to 5305.

4.3. The terms ‘textile pulp’, ‘chemical materials’ and ‘paper-making materials’ are used in the list to describe the materials
not classified in Chapters 50 to 63, which can be used to manufacture artificial, synthetic or paper fibres or yarns.

4.4. The term ‘man-made staple fibres’ is used in the list to refer to synthetic or artificial filament tow, staple fibres or

waste, of heading Nos 5501 to 5507.

N o t e 5 :

5.1. Where for a given product in the list a reference is made to this note, the conditions set out in column 3 shall not be
applied to any basic textile materials, used in the manufacture of this product, which, taken together, represent 10
per cent or less of the total weight of all the basic textile materials used. (See also Notes 5.3 and 5.4 below).

5.2. However, the tolerance mentioned in Note 5.1 may only be applied to mixed products which have been made from

two or more basic textile materials.

The following are the basic textile materials:

— silk,

— wool,

— coarse animal hair,

— fine animal hair,

— horsehair,

— cotton,

— paper-making materials and paper,

— flax,

— true hemp,

— jute and other textile bast fibres,

— sisal and other textile fibres of the genus Agave,

— coconut, abaca, ramie and other vegetable textile fibres,

— synthetic man-made filaments,

— artificial man-made filaments,

— current conducting filaments,

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— synthetic man-made staple fibres of polypropylene,

— synthetic man-made staple fibres of polyester,

— synthetic man-made staple fibres of polyamide,

— synthetic man-made staple fibres of polyacrylonitrile,

— synthetic man-made staple fibres of polyimide,

— synthetic man-made staple fibres of polytetrafluoroethylene,

— synthetic man-made staple fibres of polyphenylene sulphide,

— synthetic man-made staple fibres of polyvinyl chloride,

— other synthetic man-made staple fibres,

— artificial man-made staple fibres of viscose,

— other artificial man-made staple fibres,

— yarn made of polyurethane segmented with flexible segments of polyether whether or not gimped,

— yarn made of polyurethane segmented with flexible segments of polyester whether or not gimped,

— products of heading No 5605 (metallized yarn) incorporating strip consisting of a core of aluminium foil or of a
core of plastic film whether or not coated with aluminium powder, of a width not exceeding 5 mm, sandwiched
by means of a transparent or coloured adhesive between two layers of plastic film,

— other products of heading No 5605.

Example:

A yarn of heading No 5205 made from cotton fibres of heading No 5203 and synthetic staple fibres of heading No
5506 is a mixed yarn. Therefore, non-originating synthetic staple fibres that do not satisfy the origin rules (which
require manufacture from chemical materials or textile pulp) may be used up to a weight of 10 per cent of the yarn.

Example:

A woollen fabric of heading No 5112 made from woollen yarn of heading No 5107 and synthetic yarn of staple
fibres of heading No 5509 is a mixed fabric. Therefore, synthetic yarn which does not satisfy the origin rules (which
require manufacture from chemical materials or textile pulp) or woollen yarn that does not satisfy the origin rules
(which require manufacture from natural fibres, not carded or combed or otherwise prepared for spinning) or a
combination of the two may be used provided their total weight does not exceed 10 per cent of the weight of the
fabric.

Example:

Tufted textile fabric of heading No 5802 made from cotton yarn of heading No 5205 and cotton fabric of heading
No 5210 is only a mixed product if the cotton fabric is itself a mixed fabric being made from yarns classified in two
separate headings or if the cotton yarns used are themselves mixtures.

Example:

If the tufted textile fabric concerned had been made from cotton yarn of heading No 5205 and synthetic fabric of
heading No 5407, then, obviously, the yarns used are two separate basic textile materials and the tufted textile fabric
is accordingly a mixed product.

5.3. In the case of products incorporating ‘yarn made of polyurethane segmented with flexible segments of polyether

whether or not gimped’ this tolerance is 20 per cent in respect of this yarn.

5.4. In the case of products incorporating ‘strip consisting of a core of aluminium foil or of a core of plastic film whether
or not coated with aluminium powder, of a width not exceeding 5 mm, sandwiched by means of an adhesive
between two layers of plastic film’, this tolerance is 30 per cent in respect of this strip.

N o t e 6 :

6.1. In the case of those textile products, which are marked in the list by a footnote referring to this Introductory Note,
textile trimmings and accessories which do not satisfy the rule set out in the list in column 3 for the made up
products concerned may be used provided that their weight does not exceed 10 % of the total weight of all the
textile materials incorporated.

Textile trimmings and accessories are those classified in Chapters 50 to 63. Linings and interlinings are not to be
regarded as trimmings or accessories.

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6.2. Any non-textile trimmings and accessories or other materials used which contain textiles do not have to satisfy the

conditions set out in column 3 even though they fall outside the scope of Note 3.5.

6.3. In accordance with Note 3.5, any non-originating non-textile trimmings and accessories or other product, which do
not contain any textiles, may, anyway, be used freely where they cannot be made from the materials listed in
column 3.

For example if a rule in the list says that for a particular textile item, such as a blouse, yarn must be used, this does
not prevent the use of metal

items, such as buttons, because they cannot be made from textile materials.

6.4. Where a percentage rule applies, the value of trimmings and accessories must be taken into account when calculating

the value of the non-originating materials incorporated.

N o t e 7 :

7.1. For the purposes of heading Nos ex 2707, 2713 to 2715, ex 2901, ex 2902 and ex 3403, the ‘specific processes’

are the following:

(a) vacuum distillation;

(b) redistillation by a very thorough fractionation process (1);

(c) cracking;

(d) reforming;

(e) extraction by means of selective solvents;

(f) the process comprising all the following operations: processing with concentrated sulphuric acid, oleum or
sulphuric anhydride; neutralization with alkaline agents; decolorization and purification with naturally active
earth, activated earth, activated charcoal or bauxite;

(g) polymerization;

(h) alkylation;

(i) isomerization.

7.2. For the purposes of heading Nos 2710, 2711 and 2712, the ‘specific processes’ are the following:

(a) vacuum distillation;

(b) redistillation by a very thorough fractionation process;

(c) cracking;

(d) reforming;

(e) extraction by means of selective solvents;

(f) the process comprising all the following operations: processing with concentrated sulphuric acid, oleum or
sulphuric anhydride; neutralization with alkaline agents; decolorization and purification with naturally active
earth, activated earth, activated charcoal or bauxite;

(g) polymerization;

(h) alkylation;

ij) isomerization;

(k) in respect of heavy oils falling within heading No ex 2710 only, desulphurization with hydrogen resulting in a

reduction of at least 85 per cent of the sulphur content of the products processed

(ASTM D 1266-59 T method);

(l) in respect of products falling within heading No 2710 only, deparaffining by a process other than filtering;

(m) in respect of heavy oils falling within heading No ex 2710 only, treatment with hydrogen at a pressure of more
than 20 bar and a temperature of more than 250 °C with the use of a catalyst, other than to effect
desulphurization, when the hydrogen constitutes an active element in a chemical reaction. The further treatment
with hydrogen of lubricating oils of heading No ex 2710 (e.g. hydrofinishing or decolorization) in order, more
especially, to improve colour or stability shall not, however, be deemed to be a specific process;

(1) See Additional Explanatory Note 4(b) to Chapter 27 of the Combined Nomenclature.

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(n) in respect of fuel oils falling within heading No ex 2710 only, atmospheric distillation, on condition that less
than 30 per cent of these products distils, by volume, including losses, at 300 °C by the ASTM D 86 method;

(o) in respect of heavy oils other than gas oils and fuel oils falling within heading No ex 2710 only, treatment by

means of a high-frequency electrical brush-discharge.

7.3. For the purposes of heading Nos ex 2707, 2713 to 2715, ex 2901, ex 2902 and ex 3403, simple operations such
as cleaning, decanting, desalting, water separation, filtering, colouring, marking, obtaining a sulphur content as a
result of mixing products with different sulphur contents, any combination of these operations or like operations do
not confer origin.

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List of working or processing required to be carried out on non-originating materials in order that the product
manufactured can obtain originating status (*)

Appendix 2

(*) This Appendix will be published in the Official Journal as soon as possible.

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Appendix 3

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Appendix 4

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Appendix 5 A

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Appendix 5 B

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Appendix 6

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Appendix 7

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CONDITIONS FOR ENTRY INTO THE COMMUNITY OF PRODUCTS NOT ORIGINATING IN THE OCT, BUT
WHICH ARE IN FREE CIRCULATION IN THE OCT, AND METHODS OF ADMINISTRATIVE COOPERATION

ANNEX IV

Article 1

Direct transport

1.
The arrangements provided for under the provisions of
Article 36 of this Decision apply only to products, satisfying
the requirements of this Annex, which are transported directly
between the territory of the OCT and the Community without
entering any other territory. However, products constituting
one single consignment may be transported through territory
other than that of the OCT with, should the occasion arise,
transhipment or temporary warehousing in such territory,
the
provided that
customs authorities in the country of transit or warehousing
and do not undergo operations other than unloading, reloading
or any operation designed to preserve them in good condition.

they remain under

the surveillance of

2.
Evidence that the conditions set out in paragraph 1 have
been fulfilled shall be supplied to the responsible customs
authorities by the production of:

(a) a single transport document covering the passage from the
exporting country or territory through the country of
transit; or

(b) a certificate issued by the customs authorities of

the

country of transit:

(i) giving an exact description of the products;

(ii) stating the dates of unloading and reloading of the
products and, where applicable, the names of the ships,
or the other means of transport used; and

(iii) certifying the conditions under which the products

remained in the transit country; or

(c) failing these, any substantiating documents.

Article 2

Export Certificate EXP

1.
Evidence of compliance with the provisions of Article 36
of this Decision shall be given by an Export Certificate EXP, a
specimen of which appears in the Appendix.

2.
An Export Certificate EXP shall be issued by the customs
authorities of the exporting OCT on application having been
made in writing by the exporter or, under the exporter's
responsibility, by his authorised representative.

in the Appendix. These forms

3.
For this purpose, the exporter or his authorised repres-
entative shall fill out the Export Certificate EXP, a specimen of
shall be
which appears
completed in accordance with the provisions of this Annex. If
they are hand-written, they shall be completed in ink in printed
characters. The description of the products must be given in
the box reserved for this purpose without leaving any blank
lines. Where the box is not completely filled, a horizontal line

must be drawn below the last line of the description, the empty
space being crossed through.

Applications for Export Certificates EXP must be preserved for
at least three years by customs authorities of the exporting
country or territory.

The exporter applying for the issue of an Export Certifi-
4.
cate EXP shall be prepared to submit at any time, at the request
of the customs authorities of the exporting OCT where the
Export Certificate EXP is issued, all appropriate documents
proving that the products to be exported are such as to qualify
for the issue of an Export Certificate EXP.

Exporters are required to keep the supporting documents
referred to in this paragraph for at least three years.

An Export Certificate EXP shall be issued by the customs
5.
authorities of the exporting OCT if the products concerned can
be considered as having been in free circulation and fulfil the
other provisions of Article 36 of this Decision.

The issuing customs authorities shall

6.
take any steps
necessary to verify the correctness of the application. For this
purpose, they shall have the right to call for any evidence and
to carry out any inspection of the exporter's accounts or any
other check considered appropriate. The issuing customs
authorities shall also ensure that the form referred to in para-
graph 3 is duly completed.
In particular, they shall check
whether the space reserved for the description of the products
has been completed in such a manner as to exclude all poss-
ibility of fraudulent additions.

The date of issue of the Export Certificate EXP shall be

7.
indicated in Box 11 of the certificate.

8.
An Export Certificate EXP shall be issued by the customs
authorities and made available to the exporter as soon as actual
exportation has been effected or ensured.

Article 3

Issue of a duplicate Export Certificate EXP

1.
In the event of theft, loss or destruction of an Export
Certificate EXP, the exporter may apply to the customs authori-
ties which issued it for a duplicate made out on the basis of the
export documents in their possession.

The duplicate issued in this way must be endorsed with

2.
one of the following words:

‘DUPLICADO’,
‘DUPLICATA’,
‘KAKSOISKAPPALE’.

‘DUPLIKAT’,
‘DUPLICATO’,

‘ΑΝΤΙΓΡΑΦΟ’,

‘DUPLICAAT’,

‘DUPLICATE’,
‘SEGUNDA VIA’,

3.
The endorsement referred to in paragraph 2 shall be
inserted in the ‘Remarks’ box 7 of the duplicate Export Certifi-
cate EXP.

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The duplicate, which must bear the date of issue of the
4.
original Export Certificate EXP, shall take effect as from that
date.

Article 7

Verification of Export Certificates EXP

Article 4

Validity of Export Certificates EXP

An Export Certificate EXP shall be valid for four months
1.
from the date of issue in the exporting OCT, and must be
submitted within the said period to the customs authorities of
the importing country.

Exports Certificate EXP which are submitted to the
2.
customs authorities of the importing country after the final
date for presentation specified in paragraph 1 may be accepted
for the purpose of applying the arrangements, where the failure
to submit these documents by the final date set is due to
exceptional circumstances.

In other cases of belated presentation,

3.
the customs
authorities of the importing country may accept the Export
Certificates EXP where the products have been submitted
before the said final date.

Article 5

Submission of Export Certificates EXP

Export Certificates EXP shall be submitted to the customs
authorities of the importing country in accordance with the
procedures applicable in that country. The said authorities may
require a translation of Export Certificates EXP and may also
require the import declaration to be accompanied by a state-
ment from the importer to the effect that the products meet
the conditions required for the implementation of the Decision.

ARRANGEMENTS FOR ADMINISTRATIVE COOPERATION

Article 6

Mutual assistance

1.
The OCT shall send to the Commission specimens of the
stamps used together with the addresses of the customs author-
ities competent to issue Export Certificates EXP if they differ
from those included in Article 31 of Annex III. The OCT shall
carry out the subsequent verification of Export Certificates EXP.

Export Certificates EXP shall be accepted for the purpose of
applying the arrangements provided for from the date the
information is received by the Commission.

The Commission shall send this information to the customs
authorities of the Member States.

2.
In order to ensure the proper application of this Annex,
the OCT and the Community shall assist each other, through
the competent customs administrations,
in checking the
authenticity of the Export Certificates EXP and the correctness
of the information given in these documents.

1.
Subsequent verifications of Export Certificates EXP shall
be carried out at random or whenever the customs authorities
of the importing country have reasonable doubts as to the
authenticity of such documents or the compliance with the
provisions of Article 36 of this Decision.

2.
For the purposes of implementing the provisions of para-
graph 1, the customs authorities of the importing country shall
return the Export Certificate EXP,
the relevant commercial
documents or a copy of these documents, to the customs
authorities of the exporting OCT giving, where appropriate, the
reasons for the enquiry. Any documents and information
obtained suggesting that the information given on the Export
Certificate EXP is incorrect shall be forwarded in support of the
request for verification.

3.
The verification shall be carried out by the customs
authorities of the exporting OCT. For this purpose, they shall
have the right to call for any evidence and to carry out any
the exporter's accounts or any other check
inspection of
considered appropriate.

If

the customs authorities of

4.
the importing country
decide to suspend the application of the arrangements to the
products concerned while awaiting the results of the verifica-
tion, release of the products shall be offered to the importer
subject to any precautionary measures judged necessary.

the results of

5.
The customs authorities requesting the verification shall
this verification as soon as
be informed of
possible. These results must indicate clearly whether the docu-
ments are authentic and whether the products concerned can
be considered as having fulfilled the provisions of Article 36 of
this Decision.

6.
If in cases of reasonable doubt there is no reply within
ten months of the date of the verification request or if the reply
does not contain sufficient
information to determine the
authenticity of the document in question or that the products
to be exported are such as to qualify for the issue of an Export
Certificate EXP, the requesting customs authorities shall, except
in exceptional circumstances, refuse application of the arrange-
ments.

7. Where the verification procedure or any other available
information appears to indicate that the provisions of this
Annex are being contravened, the OCT on its own initiative or
at the request of the Community shall carry out appropriate
enquiries or arrange for such enquiries to be carried out with
due urgency to identify and prevent such contraventions. The
Commission may participate in the enquiries.

8. Where disputes arise in relation to the verification
procedures which cannot be settled between the customs
authorities requesting a verification and the customs authorities
responsible for carrying out this verification or where they raise
a question as to the interpretation of this Annex, they shall be
submitted to the Customs Code Committee set up by Council
Regulation (EEC) No 2454/93.

9.
In all cases the settlement of disputes between the
importer and the customs authorities of the importing country
shall be under the legislation of the said country.

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Article 8

Penalties

Penalties shall be imposed on any person who draws up, or
causes to be drawn up, a document which contains incorrect
information to enable products to be accepted as eligible for
the arrangements provided for.

Article 9

Free zones

The OCT and the Member States shall take all necessary steps
to ensure that products traded under cover of an Export Certifi-
cate EXP and which in the course of transport use a free zone

situated in their territory, are not substituted by other goods
and do not undergo handling other than normal operations
designed to prevent their deterioration.

Article 10

Annexes

The Appendix to this Annex shall form an integral part thereof.

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ANNEX V

EURO-INFO CORRESPONDENCE CENTRES (EICC)

Tasks of the EICC

In respect of the OCTs the tasks of the Euro-info Correspondence Centres (EICC) shall be to:
— disseminate Community information to OCT firms,
— gather and transmit to the Euro-info Centres (EIC) information from the OCTs which may be of use to European small

and medium-sized enterprises,

— answer general,
— answer general,

legal, administrative and statistical questions from OCT firms about the European Union,
legal, administrative and statistical questions from Community firms about the OCTs.

To achieve the greatest possible reciprocity in the exchange of information, the Commission shall ensure that Community
firms have access to the same type of information and the same advisory/support services in relation to the OCTs as those
offered by the Community to OCT firms.

Tools and services

The following tools and services shall be made available to or be acquired by the Correspondence Centres for the proper
performance of their work:

(a) documentation: a list of documents selected to form a basic library collection (to be acquired); terms and cost of

acquisition;

(b) a specific software program (to be acquired) for creating and managing dossiers on specific issues and conducting

searches on previous dossiers and existing document and databases;

(c) databases:

list of databanks available (for which there is a charge); terms and cost of connection;

(d) training: teach yourself courses (to be acquired), timetable of training sessions (specific Community matters, working
of the EICs), fee-paying training sessions in database use, and annual conference of all EICs and EICCs (for all these
activities, travel and accommodation expenses to be borne by the EICC);

(e) access to information officers of the central administration for replies to requests for information on Community-

related matters;

(f) access to the capitalisation database via the VANS: this EIC-network database contains questions and answers on

mainly Community matters;

(g) electronic mail: the EICCs shall have access to the electronic mail system,

in particular the EIC network's own

environment.

Establishment procedures

1. A request for the establishment of a correspondence centre and the choice of host structure should be addressed to
the Commission by the competent authorities of the country or territory through the channels provided for in Article
59 of this Decision.

2. An agreement providing for, inter alia, sufficient human, material and financial resources shall be concluded between

the EICC and the Commission.

Criteria for selecting the host structure

The following criteria shall be used to select applicant host structures of the EICCs:
— experience of the applicant structure in assisting and advising businesses, a business-oriented attitude to small and

medium-sized enterprises,

— representativeness in respect of the business sector in the applicant country or territory,
— knowledge of European issues,
— the will and the ability to ensure reciprocity of services to OCT and Community firms,
— the potential for financial
— willingness to employ as staff for the Centre, people with a good command of English or French and experience of

independence,

computers,

— provision of computer and communications equipment that complies with the specifications,
— an undertaking to serve all small and medium-sized enterprises equally without discrimination as to status or sector,

where appropriate in liaison with other EICs or EICCs on the network.