Proposal for a Council Decision establishing the Community position within the General Council of the World Trade Organization on the accession of the Republic of Cape Verde to the World Trade Organization
Date: 2007-12-06
Institutions: European Commission
Subjects: Cabo Verde, World Trade Organisation, market access, trade policy

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 6.12.2007 
COM(2007) 784 final 

2007/0276 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position within the General Council of the World Trade 
Organization on the accession of the Republic of Cape Verde to the World Trade 
Organization 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

Overview of the Terms of Cape Verde’s Accession to the WTO 

I. INTRODUCTION 

Members  of  the  World  Trade  Organisation  (WTO)  and  the  Republic  of  Cape  Verde  have 
reached  the  concluding  stage  of  agreement  on  the  terms  for  Cape  Verde’s  accession  to  the 
organisation.  This  comes  after  eight  years  of  negotiations,  which  began  when  Cape  Verde 
submitted  its  application  to  join  the  WTO  in  1999.  There  must  now  be  a  Council  Decision 
approving  the  terms  of  Cape  Verde'  accession,  before  the  EU  can  formally  support  Cape 
Verde's entry. 

A summary of the terms of the accession is set out below. 

II. SUMMARY OF TERMS OF CAPE VERDE’S WTO ACCESSION BY SECTOR 

Goods  

The simple average of Cape Verde's applied rates on industrial goods is 10.9%. The average 
of the initial bound rates (IBR) is at 17.7%, which will be reduced to 14.6% final bound rates 
(FBR) in the average staging period of 3 years. 60% of all tariff lines will be at or below 15% 
duty rates. Around 10% of the lines will remain at peak level above 25%. All tariffs will be 
bound. 

On agricultural goods, the average of the initial bound rates (IBR) is at 15.1%, which will be 
reduced to 13.4% (FBR) in the average staging period 3 years. The highest rates are found in 
beer  and  non-alcoholic  beverages  sectors  at  FBR  55%  and  mineral  waters  and  potatoes  at 
35%. 

These  levels  are  very  low  considering  the  LDC  status  of  Cape  Verde.  The  EC  practice  as 
regards  average  rates  required  from  an  LDC  are  30%  for  industrial  goods  and  40%  for 
agricultural  goods.  Cape  Verde  is  participating  in  the  EPA  negotiations  as  a  member  of  the 
West African region, and is a member of ECOWAS. 
Services  

The accession negotiations also focused strongly on services, of paramount importance both 
to the EU as the world’s leading exporter in this field and to Cape Verde given the important 
role of services to its economic development. Cape Verde's commitments cover a wide range 
of  service  sectors  essential  to  attract  investment  and  build  up  the  economic  infrastructure 
necessary for Cape Verde's development and growth, including:  

Computer and related services: The whole sector will be open. 

Telecommunication services: Monopoly rights for CV Telecom will cease to apply after 2012. 
Cape Verde will also apply the Reference Paper on Telecommunication services. 

Construction services: Cape Verde has made very substantial commitments in this sector. 

Distribution  services:  Although  some  products  are  excluded  (e.g.  precious  metals  and 
pharmaceuticals)  and  some  ownership  restrictions  apply  in  the  retailing  sector,  Cape  Verde 
has made significant commitments in this sector. 

Environmental services: Cape Verde has made full commitments in this sector. 

Travel and Tourism services: Cape Verde's commitments in this sector take into account its 
level  of  development  and  also  recognise  the  importance  of  this  sector  to  its  economy. 

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Ownership  restrictions  apply  to  restaurants  and  a  joint  venture  requirement  is  applicable  to 
travel agencies and tour operators. 

Financial services: Cape Verde has made good commitments across a wide range of financial 
services, including both banking and insurance services. 

Transport  services:  Cape  Verde's  commitments  provides  unrestricted  access  to  international 
maritime transport (both for passengers and freight) and access to port services on reasonable 
and non discriminatory terms and conditions. 

Protocol commitments 

In the final, multilateral stage of the accession process, WTO Members collectively sought to 
ensure the basic compatibility of Cape Verde's trade laws and institutions with WTO rules and 
agreements,  setting  these  out  in  the  Protocol  of  accession  and  Working  Party  Report.  The 
following issues are of particular interest to the EU: 

Trading rights  

Cape  Verde  has  committed  to  grant  full  trading  rights  to  foreign  operators  upon  accession. 
Cape Verde will also amend its commercial legislation regarding commercial registration and 
registration fees accordingly, to equalise the treatment of domestic and foreign operators, and 
import and export activities in comparison to other commercial activities. 

Quantitative import restrictions and licensing systems 

Cape Verde will eliminate all quantitative restrictions on imports from the date of accession. 
The  import  licensing  regime  would  also  be  brought  into  compliance  with  the  WTO  rules, 
including the Agreement on Import Licensing Procedures, upon accession. 

Subsidies  

Cape Verde has currently two subsidy programmes that provide prohibited export subsidies. 
Cape Verde has taken on a commitment to phase out all prohibited subsidies by end 2009. 

Areas where transition periods have been requested 

Customs  valuation:  Cape  Verde  will  be  in  full  compliance  with  the  WTO  Agreement  on 
Customs Valuation by end 2010. 

Sanitary and Phytosanitary measures: Cape Verde will be in full compliance with the WTO 
SPS Agreement by end 2009. 

Intellectual Property rights: Cape Verde will be in full compliance with the TRIPS Agreement 
by  end  2012,  except  in  areas  of  pharmaceutical  products  and  data  protection,  where  full 
compliance will be reached by end 2015. 

III. RECOMMENDATION 

In submitting the terms of Accession of the Republic of Cape Verde to the WTO for approval 
by  the  Council,  the  Commission  commends  these  terms  as  representing  a  balanced  but 
ambitious package of market opening commitments, which will bring substantial benefits to 
Cape Verde and her WTO trading partners alike. 

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2007/0276 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position within the General Council of the World Trade 
Organization on the accession of the Republic of Cape Verde to the World Trade 
Organization 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Articles 
133(1) and 133(5) in conjunction with the second subparagraph of Article 300(2) thereof 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

On  11  November  1999  the  Government  of  the  Republic  of  Cape  Verde  applied  for 
accession  to  the  Agreement  establishing  the  World  Trade  Organization  (WTO), 
pursuant to Article XII of that Agreement. 

A Working Party on Cape Verde’s accession was established on 17 July 2000 in order 
to  reach  agreement  on  terms  of  accession  acceptable  to  the  Republic  of  Cape  Verde 
and all WTO Members. 

The Commission, on behalf of the Community, negotiated a comprehensive series of 
market opening commitments on the part of the Republic of Cape Verde which are of 
particular importance to the Community, as set out in a memorandum agreed between 
the  negotiators  of  the  Republic  of  Cape  Verde  and  the  Commission  on  26  October 
2007. 

These commitments are now embodied in the Protocol of Accession of the Republic of 
Cape Verde to the WTO. 

Accession to the WTO is expected to make a positive and lasting contribution to the 
process  of  economic  reform  and  sustainable  development  in  the  Republic  of  Cape 
Verde. 

The Protocol of Accession should therefore be approved. 

Article  XII  of  the  Agreement  establishing  the  WTO  provides  that  the  terms  of 
accession are to be agreed between the acceding Member and the WTO, and that the 
Ministerial Conference of the WTO approves the terms of accession on the WTO side. 
Article  IV.2  of  the  Agreement  establishing  the  WTO  provides  that  in  the  intervals 
between  meetings  of  the  Ministerial  Conference,  its  functions  shall  be  conducted  by 
the General Council. 

(8) 

Accordingly,  it  is  necessary  to  establish  the  position  to  be  taken  by  the  Community 
within the General Council, 

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HAS DECIDED AS FOLLOWS: 

Sole Article 

1. 

The position to be taken by the Community within the General Council of the WTO 
on  the  accession  of  the  Republic  of  Cape  Verde  to  the  WTO,  is  to  approve  the 
accession. 

2. 

This position shall be expressed by the Commission on behalf of the Community. 

Done at Brussels,  

For the Council 
The President 

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