Proposal for a Council Regulation amending Regulation (EC) No 3286/94 laying down Community procedures in the field of the common commercial policy in order to ensure the exercise of the Community's rights under international trade rules, in particular those established under the auspices of the World Trade Organization
Date: 2007-12-13
Institutions: European Commission
Subjects: EU law, European undertaking, World Trade Organisation, application of EU law, common commercial policy, international trade law

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.12.2007 
COM(2007) 796 final 

2007/0277 (ACC) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 3286/94 laying down Community procedures in the field 
of the common commercial policy in order to ensure the exercise of the Community's 
rights under international trade rules, in particular those established under the auspices 
of the World Trade Organization 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

Council  Regulation  (EC)  No  3286/1994  ("Trade  Barrier  Regulation")  is  one  of  the  trade 
policy  instruments  available  to  monitor  the  respect  by  our  trading  partners  of  obligations 
arising from international trade agreements with the objective of removing barriers to trade. 
To  this  end,  the  Trade  Barrier  Regulation  provides  to  Community  enterprises,  "Community 
industry"  or  their  associations  the  right  to  lodge  a  complaint  with  the  Commission  on 
obstacles to trade. When admissible, the complaint triggers an investigation into the existence 
of the alleged obstacles and of adverse trade effects or injury to "Community Industry". If the 
allegations  are  confirmed  and  an  amicable  solution  cannot  be  reached,  the  procedure  may 
ultimately  result  in  the  Community  deciding  to  enter  into  formal  dispute  settlement 
procedures under an international agreement with the trading partner. 

The conditions to bring a complaint under the Trade Barrier Regulation differ for Community 
enterprises and Community industry, which opens two tracks. 

The first is for the "Community Industry", i.e. producers that account for a major proportion 
of total Community production  of identical, similar or directly competing  goods or services 
and  who  have  been  affected  by  the  trade  barrier.  This  track  concerns  trade  barriers  causing 
injury (or threat thereof) on the Community market, and may be brought against trade practice 
in respect of which any international agreement between the Community and the third country 
establishes trade rules and a right of action. This track is not affected by this proposal. 

The second is open to any Community enterprise. It can be used for obstacles causing adverse 
trade  effects  on  the  market  of  the  third  country,  but  Article  4(1)  limits  the  admissibility  of 
complaint  to  trade  practice  in  respect  of  which  a  multilateral  or  a  plurilateral  agreement 
between  the  Community  and  the  third  country  establishes  trade  rules  and  a  right  of  action. 
This means in practice that complaints alleging violations of bilateral agreements by a third 
country are only admissible to the extent that they also allege a violation of multilateral rules, 
in particular those of the WTO. 

In 2005, the European Commission ordered a study on the use of the Trade Barrier Regulation 
in  its  first  ten  years  and  on  improvements  that  could  be  brought  to  this  trade  policy 
instrument.  One  of  the  recommendations  was  to  remove  the  prohibition  for  a  Community 
enterprise  to  rely  exclusively  on  bilateral  agreements  to  bring  a  complaint  under  the  Trade 
Barrier Regulation. This recommendation was endorsed by the European Commission in its 
Communication  Global  Europe:  a  stronger  partnership  to  deliver  market  access  for 
European  exporters1  as  one  of  the  proposals  to  tackle  barriers  to  trade  and  thus  improve 
market access for our exporters and growth and jobs in the Community. 

This  prohibition  effectively  excludes  the  possibility  to  rely  on  bilateral  agreements  to  act 
against  violations  of  so-called  "WTO  plus  obligations",  in  particular  those  concerning  non-
tariff barriers not already regulated by WTO rules. 

1 

Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  Global  Europe  –  A  stronger 
partnership to deliver market access for European exporters, COM(2007) 183 final, 18.4.2007. 

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This restriction can be explained by historical reasons. Before the trade agreement concluded 
with Mexico in 2000, the mechanism to settle disputes under the bilateral agreements was the 
traditional diplomatic approach, which very much depended on the capacity of the parties to 
agree on the solution and therefore lacked efficiency in enforcing trade rules. These historical 
reasons  do  not  stand  anymore.  Since  the  enactment  of  the  Trade  Barrier  Regulation,  the 
Community  has  indeed  entered  into  a  number  of  bilateral  agreements  which  set  out 
substantive  rules  applicable  to  trade  between  the  Community  and  the  third  country,  and 
include  effective  and  binding  dispute  settlement  mechanisms  modelled  out  of  the  WTO 
dispute  settlement  mechanism  to  enforce  those  rules2.  The  Community  is  also  currently 
engaged  in  the  negotiations  of  bilateral  trade  agreements,  whose  objective  is  to  define 
substantive  obligations  to  offer  enhanced  market  access  opportunities,  and  to  ensure 
observance of these obligations with similar binding dispute settlement mechanisms3. 

In  light  of  the  development  of  bilateral  agreements  containing  substantive  trade  rules  and 
"judicial-type"  dispute  settlement  mechanisms,  there  is  no  justification  anymore  to  require 
Community enterprises to include a WTO claim in their TBR complaints in order to be able to 
rely on obligations deriving from bilateral agreements against trade barriers causing adverse 
trade effects. 

2 

3 

See  for  e.g.,  Decision  No  2/2000  of  the  EC-Mexico  Joint  Council  on  liberalisation  of  tariff  and  non-
tariff barriers  to  trade  in  goods  (OJ  L 157, 30.6.2000,  p. 10);  Decision No 2/2001 of the  EU-Mexico 
Joint Council on liberalisation of trade in services (OJ L 70, 12.3.2001, p. 7); Agreement establishing an 
association between the European Community and its Member States, of the one part, and the Republic 
of  Chile,  of  the  other  part  (OJ  L  352,  30.12.2002,  p.  3);  Association  agreements  with  the  EuroMed 
countries  to  be  completed  by  a  judicial-type  Dispute  Settlement  Mechanism,  currently  under 
negotiations. 
Without being exhaustive, negotiations are ongoing with ACP countries, South Korea, India, countries 
of the ASEAN, the Gulf Cooperation Council, Mercosur, the Andean Community, Central America. 

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2007/0277 (ACC) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 3286/94 laying down Community procedures in the field 
of the common commercial policy in order to ensure the exercise of the Community's 
rights under international trade rules, in particular those established under the auspices 
of the World Trade Organization 

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 Commission4, 

Whereas: 

(1) 

(2) 

(3) 

Regulation  (EC)  No  3286/945  provides  to  any  Community  enterprise  procedural 
means  to  request  that  the  Commission  investigates  obstacles  to  trade  adopted  or 
maintained by a third country, when those obstacles have an effect on the  market of 
that third country and adverse trade effects on the Community enterprise. 

However, pursuant to Article 4(1) of Regulation (EC) No 3286/94, a complaint by a 
Community enterprise is admissible only if the alleged obstacle to trade is the subject 
of  a  right  of  action  established  under  international  trade  rules  laid  down  in  a 
multilateral  or  plurilateral  trade  agreement.  This  means  that  complaints  alleging 
violations of bilateral obligations by a third country need to refer also to violations of 
multilateral or plurilateral rules in order to be admissible. 

Since the enactment of Regulation (EC) No 3286/94, the Community has concluded a 
number of bilateral agreements which contain substantive rules on trade between the 
Community and third countries that go significantly beyond WTO rules. Furthermore 
these  agreements  include  efficient  and  binding  dispute  settlement  mechanisms  to 
adjudicate disputes on those "WTO plus" obligations. 

(4) 

Reliance by Community enterprises on bilateral agreements to bring complaints under 
Regulation  (EC)  No  3286/94  would  contribute  to  monitoring  the  respect  of  the 

4 
5 

OJ C , , p. . 
Council Regulation (EC) No 3286/94 of 22 December 1994 laying down Community procedures in the 
field of the common commercial policy in order to ensure the exercise of the Community's rights under 
international  trade  rules,  in  particular  those  established  under  the  auspices  of  the  World  Trade 
Organization, OJ L 349, 31.12.1994, p. 71. 

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obligations  contained  in  those  agreements  and  to  tackling  barriers  to  trade,  thus 
improving market access for exporters and growth and jobs in the Community6. 

(5) 

In  light  of  these  developments,  and  in  order  to  reduce  the  administrative  burden  on 
Community enterprises, the right of those enterprises to bring complaints on obstacles 
to trade should be extended to include alleged obstacles to trade, which are solely the 
subject  of a right of  action established under international trade rules laid down in a 
bilateral trade agreement, 

HAS ADOPTED THIS REGULATION: 

Article 1 

In Article 4 of Regulation (EC) No 3286/94, paragraph 1 is replaced by the following: 

Any Community enterprise, or any association, having or not legal personality, acting 
'1. 
on  behalf  of  one  or  more  Community  enterprises,  which  considers  that  such  Community 
enterprises  have  suffered  adverse  trade  effects  as  a  result  of  obstacles  to  trade  that  have  an 
effect on the market of a third country may lodge a written complaint.' 

This Regulation shall enter into force on the twentieth day following that of its publication in 
the Official Journal of the European Union. 

Article 2 

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

Done at Brussels,  

For the Council 
The President 

6 

Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  Global  Europe  –  A  stronger 
partnership to deliver market access for European exporters, COM(2007) 183 final, 18.4.2007. 

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