Proposal for a Council Decision on the position to be taken by the European Union within the Association Council established by the Euro-Mediterranean Agreement establishing an association between the European Community and its Member States, of the one part, and the Kingdom of Morocco, of the other part, as regards the amendment of Article 15(7) of Protocol No 4 to that Agreement, concerning the definition of the concept of "originating products" and methods of administrative cooperation
Date: 2010-04-20
Institutions: European Commission
Subjects: Morocco, administrative cooperation, association agreement (EU), customs duties, originating product, tariff exemption, trade agreement (EU)

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EUROPEAN COMMISSION 

Brussels, 20.4.2010 
COM(2010)158 final 

2010/0088 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be taken by the European Union within the Association Council 
established by the Euro-Mediterranean Agreement establishing an association between 
the European Community and its Member States, of the one part, and the Kingdom of 
Morocco, of the other part, as regards the amendment of Article 15(7) of Protocol No 4 
to that Agreement, concerning the definition of the concept of "originating products" 
and methods of administrative cooperation  

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

The prohibition of drawback of customs duties is stipulated in Article 15 of Protocol 
No 4 annexed to the EC-Morocco Association Agreement. Paragraph 7 of that article 
provides  for  a  transitional  period  prior  to  the  full  application  of  the  prohibition  of 
drawback of duties by Morocco and allows the country to grant duty drawback to its 
exporters or economic operators during this period. 

The  transitional  period  expired  on  31  December  2009.  However,  Article  15(7) 
provides for the possibility of re-examining this provision by mutual agreement. 

Morocco has requested in writing that the period in which the provision on drawback 
applies be extended and that the rates of customs charges be revised. 

In accordance with Article 39 of Protocol No 4, the provisions of the Protocol may 
be amended by decision of the Association Council. 

The text of the decision will replace the existing provision laid down in Article 15(7). 

It  includes  both  the  change  to  the  application  period  of  the  provision  on  drawback 
and the revision of the rates of customs charges to be retained. 

The  parties  have  agreed  to  extend  by  three  years  the  application  period  of 
Article 15(7), with effect from 1 January 2010 in order to provide clarity, long-term 
economic predictability and legal certainty for economic operators. 

The  parties  have  also  decided  to  adjust  the  rates  of  customs  charges  currently 
applicable in Morocco to bring them into line with those that apply in the European 
Union. 

Pending  formal  adoption  of  the  present  decision,  it  was  agreed,  in  an  exchange  of 
correspondence  between  the  European  Commission  and  the  relevant  Moroccan 
authorities, that this decision will apply from 1 January 2010. 

2. 

CONSULTATION  OF 
ASSESSMENT 

INTERESTED 

PARTIES  AND 

IMPACT 

The parties concerned have been consulted in the Pan-Euro-Med working group and 
the Customs Code Committee's Origin Section. 

No recourse to external expertise has been necessary. 

It  has  not  been  necessary  to  conduct  an  impact  assessment,  since  the  proposed 
amendments are technical in nature and do not affect the substance of the protocol on 
rules of origin currently in effect. 

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3. 

LEGAL ELEMENTS OF THE PROPOSAL 

Given the nature of the changes to be made to Article 15(7) of Protocol No 4 and in 
the interest of legal certainty, the whole paragraph should be replaced. 

The  amended  provision  on  drawback  of  duties  should  apply  retroactively  from 
1 January 2010. 

The  legal  basis  for  the  amendment  of  this  provision  is  the  first  subparagraph  of 
Article 207(4) in conjunction with Article 218(9) of the Treaty on the Functioning of 
the European Union. 

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

Proposed instrument: Council decision 

4. 

BUDGETARY IMPLICATIONS 

This proposal has no financial implications for the Union budget. 

5. 

ADDITIONAL INFORMATION 

The proposal does not include any review, revision or sunset clause. 

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2010/0088 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be taken by the European Union within the Association Council 
established by the Euro-Mediterranean Agreement establishing an association between 
the European Community and its Member States, of the one part, and the Kingdom of 
Morocco, of the other part, as regards the amendment of Article 15(7) of Protocol No 4 
to that Agreement, concerning the definition of the concept of "originating products" 
and methods of administrative cooperation  

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, and in particular the 
first subparagraph of Article 207(4) in conjunction with Article 218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

Protocol  No  41  to  the  Euro-Mediterranean  Agreement  between  the  European 
Community and its Member States, of the one part, and the Kingdom of Morocco, of 
the other part, hereafter "the Agreement", as amended by Decision No 2/2005 of the 
EU-Morocco  Association  Council  of  18  November  20052,  concerns  the  definition  of 
the concept of "originating products" and methods of administrative cooperation. 

Article  15  of  Protocol  No  4  contains  a  general  prohibition  of  drawback  of,  or 
exemption from, customs duties for non-originating materials used in the manufacture 
of originating products. However, paragraph 7 of this article stipulates that a drawback 
or exemption may be applied until 31 December 2009 subject to certain conditions. 

In  order  to  provide  clarity,  long-term  economic  predictability  and  legal  certainty  for 
economic  operators,  the  parties  have  agreed  to  extend  by  three  years  the  application 
period of Article 15(7), with effect from 1 January 2010. 

(4)  Moreover,  the  rates  of  customs  charges  currently  applicable  in  Morocco  should  be 

adjusted to bring them into line with those that apply in the European Union. 

(5) 

(6) 

In accordance with Article 39 of  Protocol No 4, the  Association Council  established 
by the Agreement should decide to amend the Protocol accordingly. 

The European Union should therefore adopt the position set out in the attached draft 
decision within the Association Council, 

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OJ L 70, 18.3.2000, p. 2. 
OJ L 336, 21.12.2005, p. 1. 

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HAS ADOPTED THIS DECISION: 

Article 1 

The position to be adopted by the European Union within the Association Council established 
by  the  Euro-Mediterranean  Agreement  establishing  an  association  between  the  European 
Community and its Member States, of the one part, and the Kingdom of Morocco, of the other 
part,  as  regards  the  amendment  of  Article  15(7)  of  Protocol  No  4  to  that  Agreement, 
concerning  the  definition  of  the  concept  of  "originating  products"  and  methods  of 
administrative cooperation, with a view to extending the application period of that provision, 
is set out in the attached draft decision of the Association Council. 

Article 2 

The  decision  of  the  Association  Council  shall  be  published  in  the  Official  Journal  of  the 
European Union. 

Done at Brussels, 

For the Council 
The President 

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DECISION No […] OF THE EU-MOROCCO ASSOCIATION COUNCIL 

Draft 

of […] 

amending Article 15(7) of Protocol No 4 to the Euro-Mediterranean Agreement 
establishing an association between the European Community and its Member States, of 
the one part, and the Kingdom of Morocco, of the other part, regarding the definition of 
the concept of "originating products" and methods of administrative cooperation 

THE ASSOCIATION COUNCIL, 

Having regard to the Euro-Mediterranean Agreement establishing an association between the 
European Community and its Member States, of the one part, and the Kingdom of Morocco, 
of the other part, and in particular Article 39 of Protocol No 4 thereto, 

Whereas: 

(1) 

(2) 

Article 15(7) of Protocol No 4 to the Euro-Mediterranean Agreement establishing an 
association between the European Community and its Member States, of the one part, 
and  the  Kingdom  of  Morocco,  of  the  other  part,  hereafter  "the  Agreement",  allows 
drawback  of,  or  exemption  from,  customs  duties  or  charges  with  equivalent  effect, 
subject to certain conditions, until 31 December 2009. 

In  order  to  provide  clarity,  long-term  economic  predictability  and  legal  certainty  for 
economic  operators,  the  parties  have  agreed  to  extend  by  three  years  the  application 
period of Article 15(7), with effect from 1 January 2010. 

(3)  Moreover,  the  rates  of  customs  charges  currently  applicable  in  Morocco  should  be 

adjusted to bring them into line with those that apply in the European Union. 

(4) 

(5) 

Protocol No 4 to the Agreement should therefore be amended accordingly. 

Since  Article  15(7)  no  longer  applies  as of  31  December  2009,  this  Decision  should 
apply from 1 January 2010, 

HAS DECIDED AS FOLLOWS: 

Article 1 

Article  15(7)  of  Protocol  No  4  to  the  Euro-Mediterranean  Agreement  establishing  an 
association between the European Community and its Member States, of the one part, and the 
Kingdom of Morocco, of the other part, regarding the definition of the concept of "originating 
products" and methods of administrative cooperation, is replaced by the following text: 

"7.  Notwithstanding  paragraph  1,  Morocco  may,  except  for  products  falling  within 
Chapters 1 to 24 of the Harmonised System, apply arrangements for drawback of, or 

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exemption from, customs duties or charges having an equivalent effect, applicable to 
non-originating materials used in the manufacture of originating products, subject to 
the following provisions: 

(a) 

(b) 

a  4%  rate  of  customs  charge  shall  be  retained  in  respect  of  products  falling 
within  Chapters  25  to  49  and  64  to  97  of  the  Harmonised  System,  or  such 
lower rate as is in force in Morocco; 

an  8%  rate  of  customs  charge  shall  be  retained  in  respect  of  products  falling 
within Chapters 50 to 63 of the Harmonised System, or such lower rate as is in 
force in Morocco. 

The  provisions  of  this  paragraph  shall  apply  until  31  December  2012  and  may  be 
reviewed by common accord." 

This Decision shall enter into force on the day of its adoption. 

Article 2 

It shall apply from 1 January 2010. 

Done at 

For the Association Council 
The President 

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