WRITTEN QUESTION E-3350/02 by Ilda Figueiredo (GUE/NGL) to the Commission. Trade agreements and the liberalisation of the textile and clothing sector.
Date: 2002-11-26
Institutions: European Parliament, Provisional data
Subjects: Brazil, clothing industry, liberalisation of trade, quantitative restriction, tariff reduction, textile industry, trade agreement (EU)

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Joint answer
to Written Questions E-3067/02 and P-3393/02
given by Mr Bolkestein on behalf of the Commission

(6 January 2003)

Council Directive 92/84/EEC, of 19 October 1992, deals with the approximation of rates of excise duty on
alcohol and alcoholic beverages. Under its provisions it is necessary for the excise duty rates laid down in
that Directive to be reviewed periodically by Council. This review shall be based upon a Commission
report.

The Commission services are at present preparing such a review. On 11 September 2002 the Commission
held a comprehensive orientation debate on the EU alcohol taxation regime. A final decision on the
Commission’s approach in this area has not yet been taken. As provided by Article 8 of Directive 92/84/
EEC, the wider objectives of the Treaty will be taken into account.

As regards tax harmonisation at European level, the Commission believes that such harmonisation requires
the enhanced commitments of both high taxing and low taxing Member States.

On the other hand, there is no link between Annex 1 of the EC Treaty (referred to in Article 32, defining
the products subject to Articles 33 to 38 of the Treaty) and the question whether or not a product is
subject to excise duty.

Italy applies a zero rate of excise duty to both still and sparkling wines. This legislation is in line with the
present ‘acquis communautaire’.

(2004/C 65 E/007)

WRITTEN QUESTION E-3350/02

by Ilda Figueiredo (GUE/NGL) to the Commission

(26 November 2002)

Subject: Trade agreements and the liberalisation of the textile and clothing sector

On 6 November the Commission announced the signing of the EU-Brazil Memorandum of Understanding
on the liberalisation of the textile trade, in which the EU undertakes to remove all textile quotas applicable
to Brazil. The Commissioner Pascal Lamy said that the agreement constituted a clear signal that the EU is
ready to open up its textile market earlier than the deadline of 2005 envisaged by the WTO. This means
that it is willing to call into question compliance with the Agreement on Textiles and Clothing (ATC),
in its answer to Written Question E-3079/01 (1), did not consider that such
whilst the Commission,
bilateral agreements would jeopardise the timetable for the ATC. On the same day, in the context of aid to
developing countries and as a follow-up to the WTO Doha Round, it submitted a proposal to reduce
customs tariffs by 70 % for all non-agricultural products, proposing drastic cuts in quotas and tariffs
covering textile products and footwear, without mentioning any compensatory measures for the sectors
affected.

These proposals follow other recent agreements aimed at anticipating the strategy of liberalising the trade
in textiles and clothing, so that this sector (like the agricultural sector) may become a bargaining counter
for openings in other sectors covered by the negotiations, for example services, public contracts or
investment. The reason for the timetable laid down in the ATC was to delay opening up the market to
more sensitive products, in order to give the industry time to restructure and adapt to a situation of
liberalisation. At the time it was considered in some quarters that the deadline of 10 years for the ATC was
too short, in view of the socio-economic impact of liberalisation, especially in regions dependent on the
sector and countries such as Portugal, where textiles, clothing and footwear play an important role in
production, export and employment.

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In this context can the Commission answer the following questions:

(cid:1) What is the socio-economic impact expected to be in the textile, clothing and footwear sector in the
EU, and particularly in Portugal, of the Memorandum of Understanding concluded with Brazil and of
the proposal to reduce tariffs by 70 % in the WTO Doha Round negotiations? Has the Commission
carried out or commissioned a study on the socio-economic impact? Has it consulted the social
partners representing the sector?

(cid:1) What is expected to be gained by the de facto anticipation of the ATC and what will the socio-

economic impact be? On what research or premises is this strategy based?

(cid:1) What compensatory measures are expected to be taken to minimise the socio-economic impact on the

textile, clothing and footwear sectors?

(1) OJ C 172 E, 18.7.2002, p. 25.

Answer given by Mr Lamy on behalf of the Commission

(15 January 2003)

impact. Moreover, given that

The quota increase proposed for Brazil in the Memorandum of Understanding, initialled on 8 August 2002
and signed on 7 November 2002, will give new export opportunities to Brazil. However, the Union
imports from Brazil amount to 0,9 % in quantity and 0,3 % in value of the total Union imports of textiles
and clothing (around EUR 72,5 billion in 2001). Any increase from the Memorandum is thus unlikely to
have a major overall
the textiles and clothing industry is distributed
throughout the Community, the Commission does not anticipate particular difficulties for Portugal with
4,4 % of Community production, and 10,9 % of employment in the sector in 2001. These concessions
were not for free, as in exchange, Brazil commits not to exceed certain maximum levels of tariffs for the
whole textile and clothing sector (these levels are maximum 14 % for yarns, 16-18 % for fabrics, and 20 %
for clothing). An additional tax of 1,5 % should be eliminated upon its expiry planned for the end of 2002.
Furthermore, both parties agree to refrain from adopting any non-tariff measures, which could hinder
trade in textile and clothing products. This will address in particular a problem concerning customs
valuations in Brazil raised by the Union industry.
the on-going Union-Mercosur
negotiations, both parties agree to seek an early elimination of the customs duties applied to textile and
clothing products, either upon entry into force or at the latest in the first stage of the industrial tariff
dismantling schedule.

In the context of

In reaching bilateral agreements concerning market access in the sector (cid:1) to date there are three, with
Sri Lanka, Pakistan and now Brazil (cid:1) the Commission is working to fulfil the negotiating directives given
by the Council on 9 November 2000, by obtaining market access concessions in the textiles and clothing
sector from our trading partners (e.g. tariff reductions, binding in the World Trade Organisation (WTO)
and commitments on non-tariff barriers) in return for which the Community can offer improvements in
their quota regimes. During the whole negotiation process, the Commission is keeping the Member States
informed via the 133 (Textiles) Committee and thus any Member State’s position is carefully considered.
Furthermore, Euratex as the European representative of the sector is normally closely involved in the
preparation of the Commission’s negotiating position in the case of bilateral agreements; this was the case
for the Union-Brazil Memorandum, which counted on the support of Union industry and actually of all
the Member States.

The Commission does not consider that these agreements are jeopardising the original timetable for full
liberalisation and the removal of all quotas: what they do is either increase quotas or suspend them
vis-à-vis third countries on a case by case basis on a bilateral basis and in exchange of balanced market
access commitments by those countries which are of export importance to Union industry. Indeed, the
schedule remains in place and maintains 1 January 2005 as the date of full liberalisation pursuant to the
WTO agreement on Textiles and Clothing. Certainly, the Commission considers that further agreements
pursuant to the above mandate would benefit the European textiles and clothing industry (cid:1) for the
improved access to the third markets included in such agreements (cid:1) and therefore contribute positively to
full
liberalisation in 25 months time. And as this last agreement demonstrates, the Commission does
negotiate on a case-by-case basis.

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Regarding the Community submission to the WTO on market access for non-agricultural products, there
seems to be some misunderstanding as to its content. In fact, the initiative is aimed at meaningful
liberalisation through elimination of tariff peaks and high tariffs as well as reduction of tariff escalation in
all sectors and by all countries, but does not put forward any specific percentage for tariff reduction
As regards the specific case of textiles, the Community proposal aims at full reciprocity as tariffs for
textiles and clothing should be brought within a same narrow common range by all WTO Members. For
the Union such move does also require that non-tariff barriers are substantially reduced by all Members in
order not to frustrate the increase in market access gained through tariff reduction. By removing peaks and
high tariffs, the proposal is intended to achieve improved effective access on markets of interest to the
Union industry, and to stimulate South-South trade through greater access to developing countries
markets, whose increasing importance for developing countries’ exporters cannot be underestimated.

the final elimination of quotas in 2005 as foreseen in the ATC,

Since the Commission is not envisaging any de facto anticipation of the elimination of the Agreement on
Textiles and Clothing (ATC) quotas, the question of assessment of its impact is not relevant. As regards the
impact of
the Commission has
commissioned a study, not yet completed, as to the possible impact of the elimination of quotas in 2005.
Moreover,
interested parties
(of which importers, exporters, industry, trade unions, consumers, government representatives) to assess
the consequences of such elimination and the future of the textile and clothing industry globally.

in May 2003, the Commission is organising a major conference with all

Since the Commission is not envisaging anticipating any wholesale elimination of quotas before they are
due to expire in 2005, there should be no question of providing any compensation in favour of Union
industry, all the more since the agreements such as the one with Brazil are based on a balance of market
access between the two parties.

Finally, the Commission would like to remind the Honourable Member that the ATC constitutes a delicate
outcome of multilateral trade negotiations putting an end to a policy of more than thirty years of trade
protection, during which period the industry hopefully had the opportunity to benefit and to restructure in
order to prepare for the liberalisation at hand. At this juncture, it is not conceivable to go back on this
important achievement of the Uruguay Round. In the specific case of Portugal (cid:1) as the question has been
raised (cid:1) it is essential to recall that, an exceptional measure via a ECU 400 million grant of financial
assistance to Portugal for a specific programme for the modernization of the Portuguese textile and
in 1995 (1). This
clothing industry for the period 1995 to 1999, has been taken by the Council
Community assistance was meant
to the new
requirements of the international situation and increasing international competition following the ATC.
The Commission trusts that such initiative has borne its fruits.

to enable the Portuguese textile industry to adapt

(1) Council Regulation (EC) No 852/95 of 10 April 1995 on the grant of financial assistance to Portugal for a specific

programme for the modernisation of the Portuguese textile and clothing industry, OJ L 86, 20.4.1995.

(2004/C 65 E/008)

WRITTEN QUESTION E-3416/02

by Christopher Heaton-Harris (PPE-DE) to the Commission

(2 December 2002)

Subject: Religious freedom

Act 1990/IV entitled ‘Religious Institutions and Freedom of Conscience and Religion’ is a cornerstone in
the 1989 regime change in Hungary. Based upon the Declaration of Human and Civil Rights, and the
separation of Church and State as guaranteed by the Hungarian constitution, law 1990/IV emphasises the
equality of all Hungarians, regardless of their world-views. It sets forth equal rights and equal obligations
for all religious organisations and directs that
funds to religious
institutions must be objective.

the disbursement of government