CELEX: 51994PC0139
Language: en
Date: 1994-04-20
Title: Proposal for a COUNCIL REGULATION (EC) suspending the generalized tariff preferences for certain products originating in the Republic of korea

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                          COMMISSION OF THE EUROPEAN COMMUNITIES
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                                                                   COM(94) 139 final
                                                                   Brussels, 20.04.1994
                                                                   94/0114 (ACC)
                                                    Proposal for a
                                               COUNCIL REGULATION (EC)
                                  suspending the generalized tariff preferences for
                                certain products originating in the Republic of Korea
                                            (presented by the Commission)
 ---pagebreak---                          Explanatory Memorandum
The Republic of Korea has recently decided to unilaterally increase
the import duties on a certain number of products, with effect from 1
January 1994. The European Union is the principal supplier to the
Korean market for certain products affected by this decision, notably
in the textile sector. This action is consequently having a direct and
detrimental effect on exports from the EU to the Republic of Korea.
Despite many attempts, even at Ministerial level, to dissuade the
Republic of Korea from taking this aggressive measure, the Korean
Republic has nonetheless taken this action as a means of trade defence.
Urgent and appropriate measures are required by the EU to respond to
the Korean decision which is bound to have a significant negative
impact on EU exports to the Korean market.
In the strict legal sense, the Korean action is not contrary to GATT.
In fact, the duties on products affected by the action of the Republic
of Korea are either unbound in the GATT (80% of the Korean tariff is
not currently bound), or are lower than the GATT bound rates, thereby,
strictu sensu, allowing such adjustments. Nevertheless, by taking this
action just when the Uruguay Round negotiations have been concluded,
and taking advantage of the inevitable transitional period before the
effective implementation of the results of the negotiations, the Korean
Rapublic is obviously acting contrary to the spi r i t of the GATT.
By taking rapid action, the EU will give a clear signal that this type
of action will not be accepted, in particular, when it is taken by a
country whose per capita gross domestic product is similar to that
enjoyed by some regions of the European Union.
Therefore, it seems necessary to suspend, on a selective basis, the GSP
benefit accruing to the Republic of Korea for certain products. Taking
in account the type of EU exported products principally affected by the
Korean measures, and the volume of trade involved, it would appear
appropriate to suspend the GSP benefit for textile products covered by
the Muitifibre Agreement.
This is the object of the attached proposal.
                                    >1
 ---pagebreak---                        COUNCIL REGULATION (EC) No.
        suspending the generalized tariff preferences for certain
              products originating in the Republic of Korea
THE COUNCIL OF THE EUROPEAN UNION
Having regard to the Treaty establishing the European Community, and in
particular Article 113 thereof,
Having regard to the proposal from the Commission,
whereas the generalized scheme of preferences has for 1S94 been applied
for six months from 1 January to 30 June by Council Regulation (EC)
Mo, 3366/93 of 20 December I S S ^ D and will be automatically extended
until 31 Decemfcer if no new scfceme has been agreed upon before'the date
•f t$ Jur»;
wttefeas the Republic of Ko?e« benefits from these generalized tariff
preference*;
whereas the ecftem» of genera Uie«f tariff preferences   is an autonomous
Community scheme;
«**#feas the Republic ©f More* has recently iwple#»ented unilateral
measures which have resulted in the raising of applied customs duties,
in particular for certain products for wftich the European Union is a
major supplier to the market of the Republic of Korea;
whereas this action has to be considered as an aggressive trade policy
measure having a direct and detrimental effect on the export interests
of the European Union to the Republic of Korea, especially in the
textile sector; whereas, therefore, it is inappropriate that products
originating in the Republic of Korea and covered by the Arrangement
regarding International Trade in Textiles (MFA) should benefit from
the scheme of generalized tariff preferences, as long as this situation
continues,
(1) O.J. L 338 of 31 December 1993, p. 22
                                        Z.
 ---pagebreak--- HAS ADOPTED THIS REGULATION
                               Article 1
The preferences foreseen by Council Regulation (EC) No. 3668/93 of 20
December 1993 (1 ), shall be suspended for those products originating
in the Republic of Korea which are listed in Annex I of Council
Regulation (EEC) No. 3832/90 of 20 December 1990<2>.
                               Article 2
This Regulation shall enter into force on the 1 July 1994.
This Regulation shall be binding       in  its   entirety  and directly
applicable in all Member States.
Done at Brussels,.       1994.
                                             For the CounclI
                                               The President
(1) O.J. L 338 of 31 December 1993, p.22
(2) O.J. L 370 of 31 December 1990, p. 39
 ---pagebreak---                         COMMISSION DECLARATION
"The Commission declares that this proposal for a Council Regulation
does not constitute a precedent and that it has been made as an
exceptional response to trade measures taken by the Republic of Korea
which are seriously prejudicial to European Union interests. These
measures require, in this instance, the partial suspension of Korea's
GSP benefits."
                                   H
 ---pagebreak---                                                                      ISSN 0254-1475
                                                              COM(94) 139 final
                                                      DOCUMENTS
EN                                                                         1102
                                Catalogue number : CB-CO-94-146-EN-C
                                                             ISBN 92-77-67612-4
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