CELEX: 51978PC0394
Language: en
Date: 1978-07-24
Title: Proposal for a COUNCIL REGULATION (EEC), maintaining quantitative restrictions on the importation into Italy, France and the United Kingdom of certain textile products originating in Greece (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (78) 394
Vol. 1978/0153
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak---   COMMISSION OF THE EUROPEAN COMMUNITIES
                                                        COM(78)394 final.
                                                        Brussels . 24 July 1978
I
                                                      m
                                    • Propo sal for a
                              COUNCIL REGULATION (EEC ) ,
          maintaining quantitative restrictions on the importation
            into Italy , France and the United Kingdom of certain
            ,       textile products originating in Greece
                       :
                ( submitted to the Council by the Commission)
                      • 'i      ■             /a-' ;
                     ■ "\
                    T.    A       / ' ■ •.»'<&
                                             .<>■ •'
                         V νΚ        ·-?
   COM(78) 394 final .
 ---pagebreak---                          EXPIANATORY MEMORANDUM
  1.      As was established at the "beginning of 1977 » all Greek exports of
  textile products benefit from various incentives , notably an interest rate
  subsidy on loans to the supplier , calculated as a variable proportion of
  the export price (Decision No 1574 of the Greek Monetary Committee ).
          The subsidy is aimed at encouraging exports paid for in convertible
  currency and takes the form of a repayment of part of the fob price on
  exportation ; at the moment , this refund can be as high as twelve per cent on
  textile products , depending on the amount of value added in Greece *   In the
  case of cotton yarn, the average is 8.5 $ of the price . A measure of this
  kind is equivalent to an export subsidy, and as such is contrary to the
  very principle of Article $2 of the Treaty.     Article 51 of the Athens Agree­
  ment states that the Contracting Parties recognize that the principles laid
  down in Article 92 of the Treaty should be applied in their relations
  within the Association . To that end, Article 52 ( l ) provides that the Asso­
  ciation Council shall , by 1 November 1964, adopt the rules and conditions
' for the application of these principles . Since no decision has so far "been
  taken , Article 55 enables the Community to adopt any protective measures
  which it considers to be needed to overcome difficulties due to the absence
                                   *
  of a decision of the Association Council on the matter .
       It should be noted that the measure concerned constitutes an aid
  which under normal Community practice would never qualify for exemption
  under Article 92 ( 2 ) or (3 ).
                               »
          This measure , Which is presented by Greece as a reimbursement of
  indirect taxes on export , even though such a presentation cannot be accepted
  by the Commission, would , from that point of view, be contrary to the
  provisions of Artiole 53 ( 2 ) which forbids' reimbursements on export greater
  than the actual internal charges .
 ---pagebreak---           Even on the Greek interpretation , the details provided by Greece indicate
 a real level of tax paid of no more than, about 2,5 fa* An examination of
the Greek calculations shows first of all that only 4*284 fa as against a re­
imbursement rate of 8*5 fo is accounted for and that as to the remainder even
Greece does not seem to be able to establish a breakdown of charges .      Out
of the 4„234 f> a further 0.714       representing a financing charge for the tax
before it is reimbursed and 1.102 fo for stamp duty reimbursed by other measures ,
should be deducted leaving only 2,468 fo•
2.        Another export incentive with a more limited effect should also be
mentioned#     It consists of a flate-rate percentage deduction from the exporter 's
taxable income , for entertainment expenses etc ., ' irrespective of the value
of Ms exports ( fij?tiole 35 o f Law Fo 3323/1955)®
          This concession is set at two per cent of export turnover ; no support­
ing evidence is required and the deduction is allowed in addition to any
expenditure on promotion duly substantiated and accepted by the tax authorities .           '
Its value as a proportion of the price depends on the rate of direct tax
payable by the exporter and may be as much as 0.8 f>9
                                                                                          I
          ltia measure is a remission of direct tax which constitutes an export
aid : the same considerations therefore apply as for the first one®
                                                                                         !
          These matters were laid before the Association Council in January 1977         ?
                                                                                        I
but no decision has so far been taken .     In October and December 1977 ? however ,
a rn0 (^us vivendi was worked out between the parties with a view to remedying
the cumulative market disruption caused by imports of the products in
question®                                                                              j
3„        Since the beginning of 1978 , this modus vivendi has been called into
question on. the Greek side .    At the same time a number of the agreed limits      i
have been exceeded at regional level, and the a priori surveillance system           j
                                                                                     I
reveals that others      1 1 be exceeded shortly .                                   i
 ---pagebreak---         These developments are causing the Member States considerable anxiety,
 and three of them have lodged formal request for limits on various products
originating in Greece *   These requests have obliged the Commission to carry­
out the undertakings as regards Greeoe given to the Council on 20 December
 1977 and subsequently reaffirmed on $ and 27 June , when it promised to take
without delay all appropriate politioal and economic measures consonant with
the Community 's international obligations in order to protect the interests
of its textile sector .
                                                   /
4.      However , before having recourse to the provisions of Article 55 "the
Commission made a final effort to resolve the problem within the EEC - Greece
Association Committee at a meeting which took place on 30 June , but no
solution was reached .
5.      normally, the establishment of a countervailing duty is sufficient
to deal with a situation of abnormal competition#    In the present situation
such    solution would be totally inadequate because of technical difficulties
involved and the exceptionally large quantities of imports concerned .    In
these circumstances , the most appropriate course of action is to limit imports
of products originating in Greece , which is possible under Article 55 since
the type of measure to be invoked is not specified.
        The limits must however be established at such a level that Greece does
not suffer more than by the application of a countervailing duty#
        As the limits agreed in the roodna vivendd of December 1977 » which
are based on traditional trade flows , also represent "acceptable " levels for
the Community, since they are in line with the policy of internal global
ceilings , they meet the oriterion stated above .
 ---pagebreak--- 6 •       In view of the foregoing and in view of the breaches already registered
 in respect of certain regional tLevels and requests received from the Member
 States a.ffected , the Commission has decided to use the procedure provided in
 Article 12 of Regulation ( EEC ) Wo 1439/74 TO introduce quantitative restric­
 tions on some of these imports , by adopting Regulation ( EEC ) NO 1574/78 of
 5.7.1978 ( 1 ).
7 «       Article 12 ( 6 ) of Regulation 1439/ 74 stipulates that within ten' working
 days of the entry into force of measures which it has adopted under that
 Article , the Commission shall make a proposal to the Council on appropriate
 measures to be adopted by the Council to carry on from the Commission 's
 emergency measures . In this connection it is pointed out that Commission regu­
 lations adopted pursuant to Article 12 of Regulation ( EEC ) NO 1439/74 expire
 six weeks after their entry into force unless confirmed by the Council .
          Accordingly, the Commission proposes that the Council adopt the
 proposal for a regulation set out in the Annex, which is aimed at confirming
 the measures adopted by the Commission regulation mentioned above .
 ( 1 ) OJ Ho L 185 of 7*7.1978
 ---pagebreak---                             Proposai for »
                        COUNCIL REGULATION (EEC )
        maintaining quantitative restrictions on the importation
        into Italy, Prance and the United Kingdom of oertain -
        textile products originating in Greece
THE COUNCIL OP THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
Having regard to Council Regulation (EEC ) No 1439/74 of 4 June 1974 on common
rules for imports ( l ), and in particular Article 13 thereof,
          ;                                                          \
   1               • .                                                  /
After consultation within the Advisory Committee established "by Article 5 of
that Regulation,
         j
         i                                          '
         I
Having regard to the proposal from the Commission ,
         I
Whereas by Regulation (EEC ) NO 1574/78 of 5 July 1978 (2) the Commission intro­
duced quantitative restrictions on the importation into Italy , France and the
United Kingdom of certain textile products originating in Greece ;
Whereas the factors which caused these restrictions to be introduced still
persist ; whereas it is accordingly neoessaxy for them to remain in force
until 31 December 1978t
HAS ADOPTED THIS REGULATION I
 ( 1 ) OJ No L 159» 15.6.1974, P." 1
 (2 ) OJ No L 185 , 7.7.1978, p. 31.
 ---pagebreak---                             Article 1
        The quantitative restrictions on the importation into Italy, Prance
and the United Kingdom of certain textile products . originating in Greece ,
introduced by Regulation (EEC) NO 1574/78 shall remain applicable until
31 December 1978#
                            Article 2
      j This Regulation shall enter into force on 18 August 1978.
        This Regulation shall be binding in its entirety and directly
appliOable in all Member States *
Done at Brussels ,                                For the Council
                                                  The President