Proposal for a Council Decision on a Community position within the EU-South Africa Cooperation Council on the amendment of the relevant Annexes to the Trade, Development and Cooperation Agreement (TDCA) between the European Community and its Member States, on the one part, and the Republic of South Africa, on the other part, to phase out and eliminate the duties on some automotive products into the TDCA
Date: 2006-10-02
Institutions: European Commission
Subjects: South Africa, common commercial policy, motor car, originating product, spare part, tariff reduction, trade agreement (EU), vehicle parts

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 2.10.2006 
COM(2006) 561 final 

2006/0181 (ACC) 

Proposal for a 

COUNCIL DECISION 

on a Community position within the EU-South Africa Cooperation Council on the 
amendment of the relevant Annexes to the Trade, Development and Cooperation 
Agreement (TDCA) between the European Community and its Member States, on the 
one part, and the Republic of South Africa, on the other part, to phase out and eliminate 
the duties on some automotive products into the TDCA 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1)  CONTEXT OF THE PROPOSAL 

110 

•  Grounds for and objectives of the proposal 

Article  106  (1)  of  the  EU-SA  Trade,  Development  and  Cooperation  Agreement 
(TDCA) empowers the Cooperation Council to amend the TDCA in order to accelerate 
the  reduction  of  customs  duties  more  rapidly  than  is  provided  for  in  Article  11,  or 
otherwise  improve  the  conditions  of  access  under  the  Article.  In  this  context,  the 
objective of the proposed Council Decision is to phase out and eliminate the duties on 
some automotive products 

120 

•  General context 

This  draft  Decision  follows  an  agreement  on  automotive  which  was  reached  by  both 
parties,  at  political  level  on  6  April  2006.  This  balanced  agreement  follows  a  long 
period of intensive negotiations which started at the conclusion of the TDCA in 1999. 
The settlement of this difficult issue is not only a very positive signal for the economic 
operators involved, which eagerly expected a transparent and predictable solution since 
a long time, but also for the future of EU-SA trade relations which are currently being 
re-shaped into a more ambitious partnership. 

130 

141 

219 

229 

230 

•  Existing provisions in the area of the proposal 

Council Regulation (EC) No 980/2005.  

•  Consistency with the other policies and objectives of the Union 

This  draft  Decision  is  part  of  the  broader  Review  exercise  which  both  sides  have 
agreed to undertake according to Article 103 of the TDCA.  

2)  CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

The  parties  were  consulted,  orally,  on  the  outcome  on  the  agreement  reached  on  6 
April  2006.  Representatives  from  EU  automotive  industry  have  regularly  been 
informed on the outcome of the talks during the whole negotiating period. 

•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

not applicable 

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3)  LEGAL ELEMENTS OF THE PROPOSAL 

305 

•  Summary of the proposed action 

This  Decision  takes  into  account  the  consolidation  of  the  tariff  preferences  on 
automotive granted to SA by the Community scheme of generalised tariff preferences 
(GSP)  as  well  as  the  elimination  of  the  duty  on  some  automotive  products.  It  is 
proposed that this amendment to the TDCA should enter into force as from 1st October 
2006. 

310 

329 

331 

341 

342 

409 

•  Legal basis 

Article 133 of the Treaty establishing the EC. 

•  Subsidiarity principle 

The proposal falls under the exclusive competence of the Community. The subsidiarity 
principle therefore does not apply. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reason(s). 

This proposal will consolidate into the TDCA the current GSP duty, already enjoyed 
by  SA  (before  graduation)  and  thus  will  not  represent  a  major  change  in  the  tariff 
treatment and in the administrative requirement (proofs of origin). The proposed form 
of  action  (Council  Decision  within  the  EU-SA  Cooperation  Council)  is  as  simple  as 
possible in the context EU-SA legal framework (TDCA). 

•  Choice of instruments 

Proposed instruments: Council Decision. 

Other means would not be adequate for the following reason(s). 

It is the only way to amend TDCA trade provisions. 

4)  BUDGETARY IMPLICATION 

Due to its financial impact on EC own resources (customs revenue) the proposal has an 
implication  for  the  Community  budget.  This  impact  is  summarised  in  the  annexed 
financial statement. 

E-1766 

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2006/0181 (ACC) 

Proposal for a 

COUNCIL DECISION 

on a Community position within the EU-South Africa Cooperation Council on the 
amendment of the relevant Annexes to the Trade, Development and Cooperation 
Agreement (TDCA) between the European Community and its Member States, on the 
one part, and the Republic of South Africa, on the other part, to phase out and eliminate 
the duties on some automotive products into the TDCA 

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) 

In  order  to  ensure  clarity,  long  term  economic  predictability  and  legal  certainty  for 
economic  operators,  it  is  considered  appropriate  to  consolidate  into  the  Trade, 
Development and Cooperation Agreement between the European Community and its 
Member  States, on  the  one part,  and  the Republic  of South Africa,  on  the  other  part 
(TDCA)1, the remaining tariff preferences granted to South Africa by the Community 
scheme of generalised tariff preferences (GSP) on automotive products, as well as the 
elimination of the duty on some automotive products, and not yet provided for by the 
Community tariff concessions listed in the relevant Annexes to the TDCA.  

South  Africa,  as  a  current  beneficiary  country  under  the  Community  scheme  of 
generalised  tariff  preferences,  will  benefit  by  means  of  the  enclosed  Decision  of  the 
Joint Cooperation Council, from a commercial agreement giving preferential treatment 
including all the preferences related to automotive products provided for by the tariff 
scheme contained in Council Regulation (EC) No 980/2005 of 27 June 2005 applying 
a scheme of generalised tariff preferences2, 

HAS DECIDED AS FOLLOWS:  

The  position  to  be  adopted  by  the  Community  within  the  Joint  Cooperation  Council  on  the 
amendment of the relevant Annexes to the Trade, Development and Cooperation Agreement 

Sole Article 

1 
2 

OJ L 311, 4.12.1999, p. 2. 
OJ L 169, 30.6.2005, p. 1. 

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between the European Community and its Member States, on the one part, and the Republic 
of  South  Africa,  on  the  other  part,  to  take  into  account  the  consolidation  of  the  tariff 
preferences  on  automotive  products  granted  to  South  Africa  by  the  Community  scheme  of 
generalised tariff preferences (GSP), shall be based on the draft Decision of the Cooperation 
Council annexed to this Decision. 

Done at Brussels,  

For the Council 
The President 

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DRAFT DECISION N° …/2006 

OF THE EU-SOUTH AFRICA COOPERATION COUNCIL 

on 

on the amendment of Annex II, List 4 to the Trade, Development and Cooperation 
Agreement (TDCA) between the European Community and its Member States, on the 
one part, and the Republic of South Africa, on the other part, to phase out and eliminate 
the duties on some automotive products into the TDCA 

THE COOPERATION COUNCIL, 

Having regard to the Trade, Development and Cooperation Agreement between the European 
Community and its Member States, on the one part, and the Republic of South Africa, on the 
other  part  (TDCA),  signed  in  Pretoria  on  11  October  1999  and  in  particular  Article  106(1) 
thereof, 

Whereas: 

(1) 

(2) 

In  order  to  ensure  clarity,  long  term  economic  predictability  and  legal  certainty  for 
economic  operators,  the  parties  have  agreed  to  consolidate  into  the  TDCA  the 
remaining  tariff  preferences  granted  to  South  Africa  on  automotive  products,  by  the 
Community  scheme  of  generalised  tariff  preferences  (GSP)  and  not  yet  provided  for 
by the Community tariff concessions listed in Annex II List 4 to the TDCA. 

Article 106(1) of the TDCA empowers the Cooperation Council to amend the TDCA 
in order to accelerate the reduction of customs duties more rapidly than is provided for 
in Articles 11, or otherwise improve the conditions of access under this Article. 

(3) 

This Decision supersedes the terms laid down in Article 11 for the products concerned. 

(4) 

It  is  desirable  to  ensure  smooth  transition  from  the  GSP  to  the  preferential  bilateral 
trade regime established by the TDCA by allowing GSP proofs of origin (certificate of 
origin Form A or invoice declaration) to be submitted for a certain period of time, 

HAS DECIDED AS FOLLOWS: 

Annex II List 4 to the TDCA are hereby amended in accordance with the provisions set out in 
the Annex to this Decision. 

Article 1 

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This Decision shall supersedes the terms laid down in Article 11 of the TDCA with respect to 
imports into the Community of the products concerned. 

Article 2 

Article 3 

Proofs of origin issued in South Africa in the framework of the Community scheme of 
generalised tariff preferences (GSP) shall be accepted in the European Community as valid 
proofs of origin under the preferential bilateral trade regime established by the TDCA, 
provided that: 

(i) 

(ii) 

(iii) 

the proof of origin is submitted within ten months of the date of entry into force of 
this Decision; 

the  proof  of  origin  and  the  transport  documents  were  issued  no  later  than  the  day 
before the date of entry into force of this Decision; 

the  proof  of  origin  is  presented  at  import  into  the  European  Community  for  the 
benefit of tariff preferences previously granted under the GSP which are consolidated 
by this Decision. 

This Decision shall enter into force on 1st October 2006. 

Article 4 

Done at 

For the Cooperation Council 
The President 

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ANNEX 

COMMUNITY'S TARIFF ELIMINATION SCHEDULE 

(referred to in Article 11 of the TDCA) 

(See Annex to Draft Council Decision) 

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CN CODES 2006 

01/10-31/12/2006 

2007 

2008 

8703 10 11 

8703 10 18 

8703 21 10 

8703 21 90 

8703 22 10 

8703 22 90 

8703 23 11 

8703 23 19 

8703 23 90 

8703 24 10 

8703 24 90 

8703 31 10 

8703 31 90 

8703 32 11 

8703 32 19 

8703 32 90 

8703 33 11 

8703 33 19 

8703 33 90 

8703 90 10 

8703 90 90 

8706 00 11 

8706 00 19 

EN 

01/10/2006 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5 

1.5

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

3.5 

0 

0 

9 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0

   EN 

 
 
 
 
8706 00 91 

8706 00 99 

8707 10 10 

8707 10 90 

8707 90 10 

8707 90 90 

8708 10 10 

8708 10 90 

8708 21 10 

8708 21 90 

8708 29 10 

8708 29 90 

8708 31 10 

8708 31 91 

8708 31 99 

8708 39 10 

8708 39 90 

8708 40 10 

8708 40 90 

8708 50 10 

8708 50 90 

8708 60 10 

8708 60 91 

8708 60 99 

8708 70 10 

8708 70 50 

8708 70 91 

8708 70 99 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

EN 

10 

   EN 

 
8708 80 10 

8708 80 90 

8708 91 10 

8708 91 90 

8708 92 10 

8708 92 90 

8708 93 10 

8708 93 90 

8708 94 10 

8708 94 90 

8708 99 11 

8708 99 19 

8708 99 30 

8708 99 50 

8708 99 92 

8708 99 98 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0 

0

EN 

11 

   EN 

 
LEGISLATIVE FINANCIAL STATEMENT FOR PROPOSALS HAVING A 
BUDGETARY IMPACT EXCLUSIVELY LIMITED TO THE REVENUE SIDE 

1. 

2. 

NAME OF THE PROPOSAL: 

BUDGET LINES: 

Chapter and Article: 

Amount budgeted for the year concerned: 

3. 

FINANCIAL IMPACT  

(cid:133) 

Proposal has no financial implications 

x 

Proposal has no financial impact on expenditure but has a financial impact on 
revenue – the effect is as follows: 

(€ million to one decimal place) 

Budget line 

Revenue3 

12 month period, 
starting dd/mm/yyyy

[Year n] 

Article … 

Impact on own resources 

- 30.5 

- 7.6 

Article … 

Impact on own resources 

Situation following action 

[n+1] 

[n+2] 

[n+3] 

[n+4] 

[n+5] 

Article … 

8 

6 

Article … 

3 

Regarding  traditional  own  resources  (agricultural  duties,  sugar  levies,  customs  duties)  the  amounts 
indicated must be net amounts, i.e. gross amounts after deduction of 25 % of collection costs 

EN 

12 

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4. 

5. 

ANTI-FRAUD MEASURES 

OTHER REMARKS 

EN 

13 

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