Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2021/0406(COD)**

**PROPOSAL**

**Brussels, 10 December 2021**
**(OR. en)**

**14943/21**
**ADD 1**

**COMER 113**
**IA 204**
**CODEC 1634**

From: Secretary-General of the European Commission, signed by Ms Martine
DEPREZ, Director

date of receipt: 9 December 2021

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council
of the European Union

No. Cion doc.: COM(2021) 775 final - ANNEXES 1 to 2

Subject: ANNEXES to the Proposal for a Regulation of the European Parliament
and of the Council on the protection of the Union and its Member States
from economic coercion by third countries

Delegations will find attached document COM(2021) 775 final - ANNEXES 1 to 2.

Encl.: COM(2021) 775 final - ANNEXES 1 to 2

14943/21 ADD 1 MC/sy
## RELEX.1.A EN

EUROPEAN

COMMISSION

Brussels, 8.12.2021
COM(2021) 775 final

ANNEXES 1 to 2

**ANNEXES**

**to the**

**Proposal for a Regulation of the European Parliament and of the Council**

**on the protection of the Union and its Member States from economic coercion by third**

**countries**

{SEC(2021) 418 final} - {SWD(2021) 371 final} - {SWD(2021) 372 final}

# **EN EN**

**ANNEX I**

Union response measures pursuant to Articles 7 and 8

Measures which may be adopted pursuant to Articles 7 and 8 are:

(a) the suspension of any tariff concessions, as necessary, and the imposition of new or
increased customs duties, including the re-establishment of customs duties at the
most-favoured-nation level or the imposition of customs duties beyond the mostfavoured-nation level, or the introduction of any additional charge on the importation
or exportation of goods;

(b) the suspension of applicable international obligations, as necessary, and the
introduction or increase of restrictions on the importation or exportation of goods,
whether made effective through quotas, import or export licences or other measures,
or on the payment for goods;

(c) the suspension of applicable international obligations, as necessary, and the
introduction of restrictions on trade in goods made effective through measures
applying to transiting goods or internal measures applying to goods.

(d) the suspension of applicable international obligations concerning the right to
participate in tender procedures in the area of public procurement, as necessary, and:

(i) the exclusion from public procurement of goods, services or suppliers of goods
or services of the third country concerned or the exclusion of tenders the total
value of which is made up of more than a specified percentage of goods or
services of the third country concerned; and/or

(ii) the imposition of a mandatory price evaluation weighting penalty [1] on tenders
of goods, services or suppliers of goods or services of the third country
concerned.

Origin shall be determined on the basis of Annex II;

(e) the suspension of applicable international obligations, as necessary, and the
imposition of restrictions on the exportation of goods falling under the Union export
control regime;

(f) the suspension of applicable international obligations regarding trade in services, as
necessary, and the imposition of measures affecting trade in services;

(g) the suspension of applicable international obligations, as necessary, and the
imposition of measures affecting foreign direct investment;

(h) the suspension of applicable international obligations with respect to trade-related
aspects of intellectual property rights, as necessary, and the imposition of restrictions
on the protection of such intellectual property rights or their commercial exploitation,
in relation to right-holders who are nationals of the third country concerned;

(i) the suspension of applicable international obligations with respect to financial
services, as necessary, and the imposition of restrictions for banking, insurance,
access to Union capital markets and other financial service activities;

1 Mandatory price evaluation weighting penalty means an obligation for contracting authorities or entities
conducting public procurement procedures to increase, subject to certain exceptions, the price of goods
or services falling under this paragraph that have been offered in contract award procedures.

# EN 1 EN

(j) the suspension of applicable international obligations with respect to the treatment of
goods, as necessary, and the imposition of restrictions on registrations and
authorisations under the chemicals legislation of the Union;

(k) the suspension of applicable international obligations with respect to the treatment of
goods, as necessary, and the imposition of restrictions on registrations and
authorisations related to the sanitary and phytosanitary legislation of the Union;

(l) the suspension of applicable international obligations, as necessary, and the
imposition of restrictions on access to Union-funded research programmes or
exclusion from Union-funded research programmes.

# EN 2 EN

**ANNEX II**

Rules of Origin

1. The origin of a good shall be determined in accordance with Regulation (EU) No
952/2013 of the European Parliament and of the Council. [2]

2. The origin of a service, including a service supplied in the area of public
procurement, shall be determined on the basis of the origin of the natural or legal
person providing it. The origin of the service provider shall be deemed to be:

(a) in the case of a natural person, the country of which the person is a national or
where the person has a right of permanent residence;

(b) in the case of a legal person any of the following:

(i) if the service is provided other than through a commercial presence
within the Union, the country where the legal person is constituted or
otherwise organised under the laws of that country and in the territory of
which the legal person is engaged in substantive business operations;

(ii) if the service is provided through a commercial presence within the
Union,

(a) if the legal person is engaged in substantive business operations in
the territory of the Member State where the legal person is
established such that it has a direct and effective link with the
economy of that Member State the origin of that legal person shall
be deemed to be that of the Member State in which it is established

(b) if the legal person providing the service is not engaged in
substantive business operations such that it has a direct and
effective link with the economy of the Member State in which it is
established, the origin of that legal person shall be deemed to be the
origin of the natural or legal persons which own or control it. The
legal person shall be considered to be "owned" by persons of a
given country if more than 50 % of the equity interest in it is
beneficially owned by persons of that country and "controlled" by
persons of a given country if such persons have the power to name
a majority of its directors or otherwise to legally direct its actions.

(iii) By derogation from sub-paragraph (ii)(a), if it is decided that Union

response measures should apply to legal persons falling under
subparagraph (ii)(a), the origin of that person shall be the nationality or
the place of permanent residence of the natural or juridical person or
persons who own or control the legal person in the Union. The legal
person shall be considered to be "owned" by persons of a given country if
more than 50 % of the equity interest in it is beneficially owned by
persons of that country and "controlled" by persons of a given country if
such persons have the power to name a majority of its directors or
otherwise to legally direct its actions.

3. The nationality of an investment shall be:

2 Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying
down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).

# EN 3 EN

(a) if the investment is engaged in substantive business operations in the territory
of the Member State where the investment is established such that it has a
direct and effective link with the economy of that Member State the nationality
of the investment shall be deemed to be that of the Member State in which it is

established;

(b) if the investment is not engaged in substantive business operations such that it
has a direct and effective link with the economy of the Member State in which
it is established, the nationality of the investment shall be deemed to that of the
natural or legal persons which own or control it. The investment shall be
considered to be "owned" by persons of a given country if more than 50 % of
the equity interest in it is beneficially owned by persons of that country and
"controlled" by persons of a given country if such persons have the power to
name a majority of its directors or otherwise to legally direct its actions;

(c) by derogation from sub-paragraph (a), if it is decided that Union response
measures should apply to legal persons falling under subparagraph (a), the
nationality of the investment shall be the nationality or the place of permanent
residence of the natural or juridical person or persons who own or control the
investment in the Union. The investment shall be considered to be "owned" by
persons of a given country if more than 50 % of the equity interest in it is
beneficially owned by persons of that country and "controlled" by persons of a
given country if such persons have the power to name a majority of its
directors or otherwise to legally direct its actions.

4. Regarding trade-related aspects of intellectual property rights, the term “nationals”
shall be understood in the same sense as it is used in the paragraph 3 of Article 1 of
the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights.

# EN 4 EN