Proposal for a COUNCIL DECISION establishing the position to be taken on behalf of the European Union within the General Council of the World Trade Organization on the United States' request for a WTO waiver to permit the US to provide preferential treatment to eligible products originating in Nepal
Date: 2016-09-22
Institutions: Directorate-General for Trade and Economic Security, European Commission
Subjects: Nepal, United States, World Trade Organisation, import, originating product, tariff exemption

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   EUROPEAN COMMISSION  Brussels, 22.9.2016  COM(2016) 614 final 2016/0294 (NLE)   Proposal for a COUNCIL DECISION establishing the position to be taken on behalf of the European Union within the General Council of the World Trade Organization on the United States' request for a WTO waiver to permit the US to provide preferential treatment to eligible products originating in Nepal  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

The objective of this proposal is to establish the position to be taken by the European Union 
within  the  General  Council  of  the  World  Trade  Organization  (WTO)  on  the  United  States' 
request for a WTO waiver and thus allow the European Union to support this waiver request.  

The granting of the US' request for a WTO waiver would allow the US to provide preferential 
treatment to eligible products originating in Nepal and imported into the customs territory of 
the United States until 31 December 2025.  

• 

Consistency with existing policy provisions in the policy area 

N.a.  

• 

N.a. 

2. 

• 

Consistency with other Union policies 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

Article 218(9) of the Treaty on the Functioning of the European Union (TFEU) provides that 
when  a  decision  having  legal effects  needs  to  be  taken  in  a body  set  up  by  an  international 
agreement, the Council, on a proposal from the Commission or the High Representative of the 
Union for Foreign Affairs and Security Policy, shall adopt a decision establishing the position 
to be adopted on the European Union’s behalf. The granting of a waiver to allow the United 
States to accord preferential treatment to eligible products originating in Nepal falls under this 
provision as the decision is taken in a body set up by an international agreement (the WTO 
General  Council  or  Ministerial  Conference)  affecting  the  rights  and  obligations  of  the 
European Union. 

Subsidiarity (for non-exclusive competence)  

Proportionality 

Choice of the instrument 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS  

EVALUATIONS, 

EX-POST 

OF 

STAKEHOLDER 

BUDGETARY IMPLICATIONS 

• 

N.a. 

• 

N.a. 

• 

N.a. 

3. 

N.a. 

4. 

N.a. 

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5. 

OTHER ELEMENTS 

The  Commission  will  be  authorised  to  take  a  position  on  behalf  of  the  European  Union  to 
support  the  United  States’  request  for  a  WTO  waiver  to  the  extent  necessary  to  permit  the 
United States to provide preferential treatment to eligible products originating in Nepal until 
31 December 2025.  

The  United  States  is  seeking  to  waive  its  obligations  under  paragraph  1  of  Article  I  and 
paragraphs 1 and 2 of Article XIII of the GATT 1994 to the extent necessary to permit it to 
provide  preferential  tariff  treatment  and  a  preferential  administration  of  quantitative 
restrictions on certain products originating in Nepal that meet specific eligibility criteria.  

According to the United States, these preferences are provided to assist Nepal in its recovery 
from  a  devastating  earthquake  and  aftershocks  in  April  2015.  The  US  explain  that  this 
measure  builds  on  an  existing  framework  of  programs  intended  to  assist  Nepal's  economic 
development and will complement the efforts to promote growth and development in Nepal.  

This  new  waiver  request  submitted  by  the  US  does  not  pose  any  economic  concerns  to  the 
European Union since the preferential treatment is not expected to adversely impact the EU 
trade with the beneficiary country.  

In  light  of  these  considerations,  the  European Union  should  join  the  emerging  consensus  in 
favour of the waiver request in the WTO General Council.  

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2016/0294 (NLE) 

Proposal for a 

COUNCIL DECISION 

establishing the position to be taken on behalf of the European Union within the General 
Council of the World Trade Organization on the United States' request for a WTO 
waiver to permit the US to provide preferential treatment to eligible products 
originating in Nepal 

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) 

(4) 

Paragraphs 3 and 4 of Article IX of the Marrakesh Agreement establishing the World 
Trade  Organization  ('WTO  Agreement')  set  out  the  procedures  for  waiving  an 
obligation imposed  on  a Member by the  WTO  Agreement  or  any of the Multilateral 
Trade Agreements.  

Pursuant  to  paragraph  3  of  Article  IX  of  the  WTO  Agreement,  the  United  States 
submitted a request to waive until 31 December 2025 its obligations under paragraph 1 
of  Article  I  and  paragraphs  1  and  2  of  Article  XIII  of  the  General  Agreement  on 
Tariffs and Trade 1994 to the extent necessary to permit the United States to provide 
preferential  treatment  to  eligible  products  originating  in  Nepal  imported  into  the 
customs territory of the United States. 

The  granting  of  the  United  States  request  for  a  WTO  waiver  would  not  affect 
negatively  either  the  economy  of  the  European  Union  or  the  trade  relations  with  the 
beneficiary of the waiver.  

It  is  appropriate,  therefore,  to  establish  the  position  to  be  taken  on  behalf  of  the 
European Union within the WTO General Council to support the waiver request by the 
United States, 

HAS ADOPTED THIS DECISION:  

Article 1 

The position to be taken on behalf of the European Union within the General Council of the 
World  Trade  Organization  shall  be  to  support  the  United  States'  request  to  waive  its 
obligations  under  paragraph  1  of  Article  I  and  paragraphs  1  and  2  of  Article  XIII  of  the 
General  Agreement  on  Tariffs  and  Trade  1994  until  31  December  2025  in  accordance  with 
the terms of the United States' waiver request. 

This position shall be expressed by the Commission.  

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

Done at Brussels, 

Article 2 

For the Council 
The President 

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