Proposal for a Council Regulation implementing for the Community the tariff provisions laid down in the Association Agreement between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part
Date: 2003-01-23
Institutions: European Commission
Subjects: Chile, association agreement (EU), tariff preference, tariff quota, trade agreement (EU)

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 23.1.2003
COM(2003) 30 final

2003/0013 (ACC)

Proposal for a

COUNCIL REGULATION

implementing for the Community the tariff provisions laid down in the Association
Agreement between the European Community and its Member States, of the one part,
and the Republic of Chile, of the other part

(presented by the Commission)

EXPLANATORY MEMORANDUM

Subject  to  satisfactory  completion  of  the  approval  procedures  and  the  signature,  the
provisional  application  of  certain  provisions  of  an  Association  Agreement  between  the
European Community and Chile is expected to enter into force early in 2003.

The attached proposal for a Council Regulation sets up implementing provisions necessary for
the Community,  in  particular,  to  calculate  the  preferential  rates  of  duty  which  will  apply  to
goods of Chilean origin under the Association agreement, and to open and manage the tariff
quotas provided by that agreement. The proposal also delegates to the Commission the power
to  adopt  measures  for  the  application  of  that  agreement  and  provides  for  the  necessary
supporting  procedures.  Finally  the  proposal  provides  for  preferential  imports  under  the
agreement to be subject to surveillance, with a view to contributing to the fight against fraud.

In order to ensure smooth implementation, the Council should adopt the measures in question
in time to allow publication in the Official Journal as soon as possible before  the entry  into
force of the Agreement.

2

2003/0013 (ACC)

Proposal for a

COUNCIL REGULATION

implementing for the Community the tariff provisions laid down in the Association
Agreement between the European Community and its Member States, of the one part,
and the Republic of Chile, of the other part

THE COUNCIL OF THE EUROPEAN UNION,

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

Having regard to the proposal from the Commission,

Whereas:

(1) 

(2) 

(3) 

(4) 

(5) 

The Association Agreement between the European Community and its Member States,
of the one part, and the Republic of Chile, of the other part, hereinafter referred to as
„the Agreement“, lays down.the tariff preferences applicable to products originating in
Chile in accordance with Annex III to the said Agreement.

Council  Decision  No 2002/979/EC  of  18 November  2002  on  the  signature  and
provisional application of certain provisions of the Agreement provides that the tariff
preferences  laid  down  in  the  Agreement  shall  be  applicable  on  a  provisional  basis
pending its entry into force.

The same methods of calculation should apply to ad valorem rates of duty as well as to
specific duties except in the cases specified in article 71 (2) and (3) of the Agreement.

The Agreement stipulates that certain products  originating in Chile  may be imported
into  the  Community  within  the  limits  of  tariff  quotas,  at  a  reduced  or  a  zero  rate  of
customs duty. It is necessary to specify the products eligible for those tariff measures,
their volumes and duties and the methods for calculating the reductions.

It is appropriate to provide that the tariff quotas should be managed, in general, on a
first-come  first-served  basis  in  accordance  with  Articles  308a,  308b  and  308c  of
Commission Regulation (EEC) No 2454/93 of 2 July 1993 laying down provisions for
the  implementation  of  Council  Regulation  (EEC)  No  2913/92  establishing  the
Community Customs Code.1 The tariff quota for certain products should be managed
under  a  system  which  is  based  on  import  and  export  licences  and  which  should  be
carried out by the Commission.

1

OJ  L  253,  11.10.1993,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  502/1999  (OJ  65,
12.3.1999, p. 1).

3

                                                
(6) 

The  Combined  Nomenclature  codes  mentioned  in  this  Regulation  are  those  of  the
Combined  Nomenclature  for  2003,  as  provided  in  Council  Regulation  (EEC)
No 2658/87  of  23  July  1987  on  the  tariff  and  statistical  nomenclature  and  on  the
Common  Customs  Tariff2  as  it  was  amended  by  Commission  Regulation  (EC)
No 1832/2002.  Amendments  to  the  Combined  Nomenclature  and  TARIC  codes
adopted  after  2002  should  not  result  in  changes  of  substance  in  agreements  or  other
acts  concluded  between  the  Community  and  Chile.  It  is  appropriate,  therefore,  to
provide  that  the  amendments  and  technical  adaptations  to  the  Annex  of  the
Regulations made necessary by amendments to  the  Combined Nomenclature  may be
adopted by the Commission, assisted by the Customs Code Committee, in accordance
with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for
the  exercise  of  implementing  powers  of  the  Commission.3  It  is  also  appropriate  to
provide that the same procedure should be followed for the adoption of amendments
and technical adaptations to theAnnex of the Regulations required by the amendments
of  the  Agreement,  or  decisions  taken  thereunder,  or  other  agreements  between  the
parties.

(7) 

In the interest of combating fraud, it is necessary to provide that preferential imports
into the Community may be subject to surveillance.

HAS ADOPTED THIS REGULATION:

Article 1

1.

For the purposes of implementing the tariff preferences laid down in the Agreement:

(a)

The  term  “MFN  duty”  means  the  duties  specified  in  Part  Two  of  Annex  I  to
Council  Regulation  (EEC)  No  2658/87  of  23  July  1987  on  the  tariff  and
statistical nomenclature and on the Common Customs Tariff. However, it shall
not  mean  a  duty  set  up  between  the  framework  of  a  tariff  quota  under
Article 26 of the Treaty or under Annex 7 to Regulation (EEC) No 2658/87.

(b)

Subject to paragraph 2, the final rate of preferential duty shall be rounded down
to the first decimal place.

2.

Where the result of calculating the rate of preferential duty is one of the following,
the preferential rate shall be considered as a full exemption:

(a)

1 % or less in the case of ad valorem duties, or

(b) EUR 2 or less per individual euro amount in the case of specific duties.

2

3

OJ L 256, 7.9.1987, p. 1. Regulation as last amended by Commission Regulation (EC) No 1832/2002
(OJ L 290, 28.10.2002, p. 1).
OJ L 184, 17.7.1999, p. 23.

4

                                                
3.

1.

2.

3.

4.

1.

2.

1.

2.

Where  the  customs  duties  comprise  an  ad  valorem  duty  with  a  minimum  and
maximum  duty,  the  preferential  reduction  also  applies  to  that  minimum  and
maximum  duty.  For  products  listed  in  Annex  I  of  the  Agreement  under  categories
"EP" and "SP", the preferential reduction applies only to the ad valorem duty and in
accordance with Annex I of the Agreement. If they comprise more than one specific
duty,  the  preferential  reduction  applies  to  all  these  dutiesand  in  accordance  with.
Annex I of the Agreement.

Article 2

The Commission shall open annual tariff quotas for the products originating in Chile
set out  in the  Annex.  The customs  duties on  these products shall be reduced to the
levels provided for and within the limits of the tariff quotas specified in that Annex.

The reductions of duty referred to in the Annex are expressed as a percentage of the
customs  duties  effectively  applied  to  goods  originating  in  Chile  outside  the  tariff
quotas provided for in the Annex when declared for release for free circulation.

The  tariff  quotas  referred  to  in  the  Annex  to  this  Regulation  shall  be  opened  each
year for a twelve-month period from 1 January. However in the year 2003 and except
for the quota referred to in Article 4 (2), the volume of these quotas shall be reduced
by  the  number  of  twelfths  corresponding  to  the  calendar  months  before  this
Regulation enters into force.

Where a tariff quota falls  within a  tariff elimination category set  out in Annex  I of
the  Agreement,  this  tariff  quota  will  end  when  the  preferential  duty  is  completely
eliminated in accordance with its timetable.

Article 3

The annual volume of the tariff quotas at order Nos 09.1921, 09.1922, 09.1923 and
09.4181  in  the  Annex  to  this  Regulation  shall  be  increased  successively  by  10  per
cent each year of the original quantity from 1 January 2004.

The  annual  volume  of  the  tariff  quotas  at  order  Nos  09.1924,  09.1925,  09.1926,
09.1927,  09.1928,  09.1929  and  09.1930  in  the  Annex  to  this  Regulation  shall  be
increased  successively  by  5  per  cent  each  year  of  the  original  quantity  from
1 January 2004.

Article 4

Except for the tariff quota at order number 09.4181, the tariff quotas provided for in
the  Annex  shall  be  managed  in  accordance  with  Articles  308a,  308b  and  308c  of
Regulation (EEC) No 2454/93.

The Commission shall  lay down the  management  rules for  the  tariff  quota  at  order
number 09.4181.

5

Article 5

The amendments and technical  adaptations  of the Annex to this Regulation made necessary
by  amendments  to  the  Combined  Nomenclature  and  TARIC  codes  or  arising  from  the
amendment  of  the  Agreement,  or  from  decisions  of  the  joint  bodies  established  under  the
Agreement,  or  from  the  conclusion  of  other  agreements,  protocols  or  exchanges  of  letters
between the Community and Chile, shall be adopted by the Commission in accordance with
the management procedure set out in Article 4(2).

1.

2.

3.

1.

2.

3.

Article 6

The  Commission  shall  be  assisted  by  the  Customs  Code  Committee,  hereinafter
referred to as ‘the Committee’.

Where  reference  is  made  to  this  paragraph,  Articles  4  and  7  of  Decision
1999/468/EC  shall  apply.  The  period  laid  down  in  Article  4(3)  of  Decision
1999/468/EC shall be set at three months.

The Committee shall adopt its rules of procedure.

Article 7

Products  put into free circulation  with  the benefit of the  preferential  rates  provided
for in the Agreement may be subject to surveillance. The Commission in consultation
with the Member States shall decide the products to which this surveillance applies.

Article 308d of Regulation (EEC) No 2454/93 shall apply.

The Member  States  and  the  Commission shall  cooperate  closely  to  ensure  that  this
surveillance measure is complied with.

Article 8

This Regulation shall enter into force on the […] day following that of its publication in the
Official Journal of the European Communities.

It  shall  apply  from  the  date  of  the  provisional  application  of  certain  provisions  of  the
Agreement.

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

Done at Brussels,

For the Council
The President

6

ANNEX

concerning the products referred to in Article 2

Notwithstanding  the  rules  for  the  interpretation  of  the  combined  nomenclature,  the  wording
for the description of the products is to  be  considered  as having no more  than  an indicative
value,  the  preferential  scheme  being  determined,  within  the  context  of  this  Annex,  by  the
coverage of the CN codes as they exist at the time of adoption of this Regulation. Where ex
CN codes are indicated, the preferential scheme is to be determined by application of the CN
code and corresponding description taken together.

Annual tariff
Quota Volume

Tariff
quota duty

(net weight)

(%
reduction)

1000 tonnes4

100

3500 tonnes4

100

Order
No

CN Code

Description

Meat of bovine animals, fresh,
chilled or frozen

Meat of swine, fresh, chilled or
frozen; sausages and similar
products, of meat, meat offal, or
blood; food preparations based
on these products; other
prepared or preserved meat,
meat offal or blood; (of swine)

09.4181

0201 20

0201 30 00

0202 20

0202 30

09.1921

0203 11 10

0203 12 11

0203 12 19

0203 19 11

0203 19 13

0203 19 15

0203 19 55

0203 19 59

0203 21 10

0203 22 11

0203 22 19

0203 29 11

0203 29 13

0203 29 15

0203 29 55

0203 29 59

1601 00

1602 41

4

The annual volume of the tariff quota shall be increased successively each  year by 10 per cent of the
original quantity.

7

                                                
2000 tonnes4

7250 tonnes4

100

100

Meat of sheep or goats, fresh,
chilled or frozen

Meat and edible offal of the
poultry, fresh, chilled and
frozen; other prepared or
preserved meat (of turkeys and
of fowls of the species Gallus
domesticus)

1602 42

1602 49

09.1922

0204

09.1923

0207 11

0207 12

0207 13

0207 14

0207 24

0207 25

0207 26

0207 27

0207 32 11

0207 32 15

0207 32 19

0207 33 11

0207 33 19

0207 35 15

0207 35 21

0207 35 53

0207 35 63

0207 35 71

0207 36 15

0207 36 21

0207 36 53

0207 36 63

0207 36 71

1602 31

1602 32

09.1924

0406

Cheese and curd

09.1925

0703 20 00

Garlic

1500 tonnes5
500 tonnes5

100

100

5

The  annual  volume  of  the  tariff  quota  shall  be  increased  successively  each  year  by  5  per  cent  of  the
original quantity.

8

                                                
09.1926

1104

09.1927

2003 10 20

2003 10 30

Cereal grains otherwise worked,
except rice of heading 1006;
germ of cereals, whole, rolled,
flaked or ground

Mushrooms of the genus
Agaricus, prepared or preserved

09.1928

2008 60 19

Cherries

Table grapes, from 1 January to
14 July

Table grapes, from 1 November
to 31 December

Sugar confectionery (including
white chocolate), not containing
cocoa

1000 tonnes5

100

500 tonnes5

1000 tonnes5
37000 tonnes5

3000 tonnes5

400 tonnes

100

100

100

100

100

09.1929

ex 0806 10 10

09.1930

ex 0806 10 10

09.1931

1704 10

1704 90 30

1704 90 51

1704 90 55

1704 90 61

1704 90 65

1704 90 71

1704 90 75

1704 90 81

1704 90 99

09.1932

1806 20

1806 31 00

1806 32

1806 90

09.1933

1905 31

1905 32

1905 90 40

1905 90 45

09.1934

0302 69 66

0302 69 67

0302 69 68

0302 69 69

Chocolate and other food
preparations containing cocoa

400 tonnes

100

Sweet biscuits; waffles and
wafers

500 tonnes

100

Hake (Merluccius spp.,
Urophycis spp.), fresh or chilled

5000 tonnes

106

09.1935

0305 30 30

0305 41 00

Fish fillets, dried, salted or in
brine; smoked fish

40 tonnes

106

6

This reduction shall be increased in 9 equal stages each year starting on 1 January 2004.

9

                                                
09.1936

1604 14 11

Prepared or preserved fish

150 tonnes

1604 14 18

1604 19 39

1604 20 70

one third
of the
MFN duty

10

FINANCIAL STATEMENT

1.

TITLE OF OPERATION

Proposal  for  a  Council  Regulation  implementing  for  the  Community  the  tariff
provisions  of  Council  Decision  No 2002/979/EC  of  the  Association  Council  under
the Association Agreement between the European Community and Chile.

2.

BUDGET HEADING(S) INVOLVED

Chapter 12, Article 120.

Chapter 10, Article 100.

3.

LEGAL BASIS

Article 133 of the Treaty.

4.

4.1

DESCRIPTION OF OPERATION

General objective

To  provide  for  the  necessary  measures  and  procedures  for  implementing  the  tariff
provisions  of  the  Association  Agreement  between  the  European  Community  and
Chile.

5.

FINANCIAL IMPACT

the 

This regulation does not entail any financial losses or gains other than those foreseen
in 
the  Council
Decision No 2002/979/EC  on  the  signature  and  provisional  application  of  certain
provisions of the Agreement between the European Community and Chile.

statement  made  on 

the  occasion  of 

financial 

6.

FRAUD PREVENTION MEASURES

Provisions  on  the  management  of  tariff  quotas  include  the  necessary  measures  for
preventing  and  protecting  against  fraud  and  irregularities.  An  additional  provision
allows surveillance on a selective basis.

11