Proposal for a Council Decision on the conclusion of a Protocol amending the Stabilisation and Association Agreement between the European Communities and their Member States, of the one part, and the Republic of Croatia, of the other part, on tariff quotas for sugar and sugar products originating in Croatia or in the Community
Date: 2006-07-11
Institutions: European Commission
Subjects: Croatia, association agreement, economic stabilisation, originating product, sugar, sugar product, tariff quota

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 11.07.2006 
COM(2006) 377 final 

2006/0123 (ACC) 

Proposal for a 

COUNCIL DECISION 

on the conclusion of a Protocol amending the Stabilisation and Association Agreement 
between the European Communities and their Member States, of the one part, and the 
Republic of Croatia, of the other part, on tariff quotas for sugar and sugar products 
originating in Croatia or in the Community 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

The  Stabilisation  and  Association  Agreement  between  the  European  Communities  and  their 
Member  States,  of  the  one  part,  and  the  Republic  of  Croatia,  of  the  other  part,  (hereinafter 
referred  to  as  “the  SAA”)  was  signed  in  Luxembourg  on  29  October  2001  and  entered  into 
force  on  1  February  2005.  An  Interim  Agreement  on  trade  and  trade-related  matters  was 
applied since January 2002. 

On 28 February 2005 the Council authorised the Commission to enter into negotiations with 
the  Republic  of  Croatia  to  amend  the  preferential  arrangements  as  regards  imports  of  sugar 
originating in the Republic of Croatia into the Community under the SAA, so as to replace the 
current duty-free access for unlimited quantities with an annual duty-free tariff quota.  

On 14 March 2006, the Commission concluded negotiations with Croatia on a duty-free tariff 
quota for sugar. This new arrangement, applicable from January 2007 will permit Croatia to 
export  sugar  to  the  EC  under  a  tariff  quota  and  replaces  the  current  arrangements  under  the 
Stabilisation and Association Agreement.  

The new arrangement sets a duty-free tariff quota for EC imports of sugar from Croatia at a 
level  of  180 000  tonnes  and  incorporates  a  reciprocal  concession  to  the  Community  giving 
preferential  access  to  the  Croatian  market  for  80 000  tonnes  of  sugar  at  reduced  duty  and 
under some conditions. 

Consequently, the Council is asked to approve the appropriate amendments to the SAA in the 
form of a Protocol amending the SAA. 

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2006/0123 (ACC) 

Proposal for a 

COUNCIL DECISION 

on the conclusion of a Protocol amending the Stabilisation and Association Agreement 
between the European Communities and their Member States, of the one part, and the 
Republic of Croatia, of the other part, on tariff quotas for sugar and sugar products 
originating in Croatia or in the Community 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 133, in conjunction with the first sentence of the first subparagraph of Article 300(2) 
thereof, 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

(3) 

On 28 February 2005 the Council authorised the Commission to enter into negotiations 
with the Republic of Croatia to amend the preferential arrangements as regards imports 
of  sugar  originating  in  Croatia  into  the  Community  under  the  Stabilisation  and 
Association Agreement between the European Communities and their Member States 
of the one part, and the Republic of Croatia, of the other part1 (hereinafter referred to as 
‘the SAA’), approved by Council and Commission Decision 2005/40/EC, Euratom2. 

The Commission has finalised negotiations for a Protocol amending the SAA. The said 
Protocol should therefore be approved. 

The measures necessary for the implementation of that Protocol should be adopted by 
the  Commission  according  to  the  same  procedure  as  that  provided  for  as  regards  the 
implementation of Council Regulation (EC) No 318/2006 of 20 February 2006 on the 
common organisation of the markets in the sugar sector3, 

1 
2 
3 

OJ L 26, 28.1.2005, p. 3.  
OJ L 26, 28.1.2005, p. 1. 
OJ L 58, 28.2.2006, p. 1. 

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HAS DECIDED AS FOLLOWS: 

Article 1 

1. 

The  Protocol  amending  the  Stabilisation  and  Association  Agreement  between  the 
European Communities and their Member States, of the one part, and the Republic of 
Croatia, of the other part, on tariff quotas for sugar and sugar products originating in 
Croatia  or  in  the  Community  (hereinafter  referred  to  as  “the  Protocol”),  is  hereby 
approved on behalf of the Community. 

2. 

The text of the Protocol is attached to this Decision. 

The  President  of  the  Council  is  hereby  authorised  to  designate  the  person(s)  empowered  to 
sign the Protocol in order to express the consent of the Community to be bound thereby. 

Article 2 

Article 3 

The  Commission  shall  adopt  the  detailed  rules  for  implementing  the  Protocol  in  accordance 
with the procedure as laid down in Article 39 of Regulation (EC) No 318/2006. 

Done at Brussels,  

For the Council 
The President 

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PROTOCOL 

amending the Stabilisation and Association Agreement between the European 
Communities and their Member States, of the one part, and the Republic of Croatia, 
of the other part, on tariff quotas for sugar and sugar products  
originating in Croatia or in the Community 

THE EUROPEAN COMMUNITY, hereinafter referred to as “the Community”,  

of the one part, and 

THE REPUBLIC OF CROATIA, hereinafter referred to as “Croatia”, 

of the other part,  

Whereas: 

(1) 

(2) 

The  Stabilisation  and  Association  Agreement  between  the  European  Communities 
and  their  Member  States,  of  the  one  part,  and  the  Republic  of  Croatia,  of  the  other 
part, (hereinafter referred to as “the SAA”) was signed in Luxembourg on 29 October 
2001 and entered into force on 1 February 2005. 

Negotiations have taken place to alter the preferential arrangements in the SAA with 
regard to sugar and sugar products originating in Croatia or in the Community. 

(3) 

Appropriate amendments to the SAA should be adopted, 

HAVE AGREED AS FOLLOWS: 

Article 1 

The SAA is amended as follows: 

(1) 

Article 27 is amended as follows: 

(a) 

in paragraph 1, the first subparagraph shall be replaced by the following: 

“The  Community  shall  abolish  the  customs  duties  and  charges  having 
equivalent  effect  on  imports  of  agricultural  products  originating  in  Croatia, 
other than those of heading Nos 0102, 0201, 0202, 1701, 1702 and 2204 of the 
Combined Nomenclature.”; 

(b) 

the following paragraph 5 is added: 

“5.  Certain trade arrangements to apply to sugar and sugar products under the 
headings Nos 1701 and 1702 of the Combined Nomenclature are set out 
in Annex IV(h).”. 

(2) 

In Annex IV, the text in the Annex to this Decision is added as Annex IV(h). 

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(3) 

In the table in Annex I to Protocol 3, the following references are deleted: 

– 

– 

"1702 50 00 – Chemically pure fructose", 

"1702 90 10 – Chemically pure maltose". 

Article 2 

The Parties shall meet in the second half of 2008 to review the effects of this Protocol. 

This Protocol shall form an integral part of the SAA. 

Article 3 

This Protocol shall enter into force on 1 January 2007. 

Article 4 

Article 5 

This  Protocol  is  drawn  up  in  duplicate  in  the  Czech,  Danish,  Dutch,  English,  Estonian, 
Finnish,  French,  German,  Greek,  Hungarian,  Italian,  Latvian,  Lithuanian,  Maltese,  Polish, 
Portuguese,  Slovak,  Slovene,  Spanish,  Swedish,  and  Croatian  languages,  each  of  these  texts 
being equally authentic. 

Done at Brussels, 

For the European Community 

For the Republic of Croatia 

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ANNEX 

"ANNEX IV(h) 

referred to in Article 27(5) 

1. 

2. 

3. 

The  Community  shall  apply  duty-free  access  on  imports  into  the  Community  for 
products  originating  in  Croatia  of  headings  1701  and  1702  of  the  Combined 
Nomenclature within a limit of an annual quantity of 180 000 tonnes (net weight). 

Croatia  shall  apply  a  reduced  duty  access  on  imports  into  Croatia  of  products 
originating  in  the  Community  of  headings  1701  of  the  Combined  Nomenclature 
within a limit of an annual quantity of 80 000 tonnes (net weight), to be applied only 
once  imports  from  Croatia  to  the  Community  of  headings  1701  and  1702  of  the 
Combined Nomenclature reach 80 000 tonnes (net weight). On this quantity Croatia 
will reduce duty rates as follows: 

– 

– 

– 

on 1 January 2007 the duty shall be reduced to 75 % of the basic duty, 

on 1 January 2008 the duty shall be reduced to 70 % of the basic duty, 

on 1 January 2009 and onwards the duty shall be reduced to 50 % of the basic 
duty. 

The Community undertakes not to pay export refunds  from  the Community  budget 
for  sugar,  syrup  and  certain  other  sugar  products  falling  under  headings  1701  and 
1702  of  the  Combined  Nomenclature  when  exported  in  natural  state  to  Croatia. 
Croatia undertakes not to pay export refunds for sugar exports to the Community." 

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1. 

2. 

3. 

4. 

5. 

5.0 

FINANCIAL STATEMENT 

APPROPRIATIONS B2006: 
€801 Mio 
€763,5 Mio 

BUDGET HEADING: 
05 02 05 01 – Refunds 
Chapter 10 – Agricultural Duties 
TITLE: 
Council  Decision  on  the  conclusion  of  a  Protocol  amending  the  Stabilisation  and  Association  Agreement 
between the European Communities and their Member States, of the one part, and the Republic of Croatia, of 
the other part, on tariff quotas for sugar and sugar products originating in Croatia or in the Community 
LEGAL BASIS: 
Article 133 of the Treaty 
AIMS: 
To amend the preferential arrangements as regards imports of sugar originating in the Republic of Croatia into 
the Community under the SAA, so as to replace the current duty-free access for unlimited quantities with an 
annual duty-free tariff quota, and to set that Croatia shall apply a reduced duty access on imports of products 
originating in the Community. 
FINANCIAL IMPLICATIONS (1) 

CHARGED TO THE EC BUDGET 

EXPENDITURE 
– 
(REFUNDS / INTERVENTIONS) 
– 
– 

NATIONAL AUTHORITIES 
OTHER 

5.1  REVENUE 

OWN RESOURCES OF THE EC  

– 
(LEVIES / CUSTOMS DUTIES) 
– 

NATIONAL 

12 MONTH 
PERIOD 

(EUR million) 

– 

– 

CURRENT 
FINANCIAL 
YEAR 2006 
(EUR million) 

FOLLOWING 
FINANCIAL 
YEAR 2007 
(EUR million) 

– 

– 

– 

– 

5.0.1  ESTIMATED EXPENDITURE 
5.1.1  ESTIMATED REVENUE 
5.2  METHOD OF CALCULATION: 

– 

2008 
– 
– 

2009 
– 
– 

2010 
– 
– 

2011 
– 
– 

6.0  CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE 

RELEVANT CHAPTER OF THE CURRENT BUDGET? 

6.1  CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF 

THE CURRENT BUDGET? 

6.2  WILL A SUPPLEMENTARY BUDGET BE NECESSARY? 
6.3  WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS? 

YES NO 

YES NO 
YES NO 
YES NO 

OBSERVATIONS: 

(1) 
This  arrangement  is  without  new  impact  on  the  EU  sugar  market  balance  and  also  without  any 
financial impact as regards the export refunds. 
On  the other hand,  regarding  agricultural  duties,  taking  into  account  that  the  quantity  of  recent  sugar  imports  from 
Croatia is lower than the quantity established in the Stabilisation and Association Agreement, for which the duty is set 
at ‘0’, no financial impact is foreseeable on budgetary income. 

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