CELEX: 51994PC0448
Language: en
Date: 1994-10-31
Title: Proposal for a COUNCIL REGULATION (EC) on the definition of originating products applicable to certain minerai products and certain products of the chemical or allied industries for the purposes of the preferential tariff arrangements granted by the European Economic Community to the overseas countries and territories (OCT)

COMMISSION OF THE EUROPEAN COMMUNITIES
                                           C0M(94) 448 final
                                           Brussels, 31.10.1994
                                           94/0245 (ACC)
                              Proposal for a
                         COUNCIL REGULATION (EC)
        on the definition of originating products applicable to
          certain mineral products and certain products of the
         chemical or allied industries for the purposes of the
   preferential tariff arrangements granted by the European Economic
       Community to the overseas countries and territories (OCT)
                      (presented by the Commission)
 ---pagebreak---                                  4-
EXPLANATORY MEMORANDUM
The definition of originating products in Annex II to Council Decision
91/482/EEC of 25 July 1991 on the association of the overseas countries
and territories with the European Economic Community, which defines the
concept of originating products and methods of administrative
cooperation, does not cover certain mineral products and certain
products of the chemical or allied industries imported from these
countries and territories.1
For all such products imported under the preferential tariff
arrangements granted by the European Economic Community to the overseas
countries and territories (OCT), the Member States of the Community
define the concept of originating products in accordance with their own
national rules.
The establishment of the internal market in 1993 has brought about the
creation of an area without internal frontiers in which the free
movement of goods is assured. The Council should therefore ensure
uniform implementation of the provisions concerning the definition of
originating products applicable to the above-mentioned products for the
purposes of these preferential arrangements.
Uniform implementation of the origin rules laid down by this proposal
for a regulation must not be prejudicial to the preferential
arrangements applied by the Community to these products on the basis of
national origin rules. Within the strict limits of current imports from
those OCT which enjoy preferential arrangements, therefore, the concept
of originating product defined in this proposal should thus take
account of the conditions under which some of these products are
obtained in the OCT.
In accordance with Article 6 of the Protocol annexed to the Treaty
establishing the European Economic Community, and in the same spirit,
an examination was held of Articles 2 to 5 of the aforementioned
Protocol, concerning imports in the European Economic Community of
petroleum products refined in the Netherlands Antilles. At the end of
this examination, it does not appear necessary to amend Articles 2 to 5
of the Protocol insofar as the attached draft Regulation does not harm
the situation of the Netherlands Antilles, import in remission granted
from customs duty being maintained in the draft Regulation and the
annual quantity of 2 500 000 of tonnes envisaged by the Protocol not
being threatened since the draft Regulation introduces no measurement
on the limitation of imports.
1 OJ L 263, 19.9.1991, p. 1
 ---pagebreak---                            -   -7 «L -
               Proposal for a Council Regulation (EC) No ....
                                   of
          on the definition of originating products applicable to
            certain mineral products and certain products of the
           chemical or allied industries for the purposes of the
     preferential tariff arrangements granted by the European Economic
         Community to the overseas countries and territories (OCT)
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 definition of originating \ >ducts in Annex II to Council
Decision 91/482/EEC of 25 July 1991 on the association of the overseas
countries and territories with the European Economic Community, which
defines originating products and methods of administrative cooperation,
excludes certain mineral products and certain products of the chemical or
allied industries;^
Whereas, for all such products imported under the preferential trade
arrangements granted by the Community to the overseas.countries and
territories (OCT), the Member States of the Community have continued to be
allowed to define originating products in accordance with their own
national rules;
Whereas the completion of the internal market in 1993 has created an area
without internal frontiers in which the free movement of goods is assured;
whereas with due respect for the principle of subsidiarity, it is important
to have a uniform definition of originating products applicable to certain
mineral products and certain products of the chemical or allied industries
for the purposes of the above-mentioned arrangements;
1  0J L 263, 19.9.1991, p. 1.
 ---pagebreak--- Whereas common rules should therefore be adopted for the products concerned
 In order to determine the conditions in which such products acquire the
status of originating products for the purposes of the application of the
tariff preference arrangements referred to above;
Whereas the uniform implementation of the provisions concerning the
definition of the concept of originating products should be without
prejudice to the preferential arrangements applied by the Community to the
products concerned on the basis of origin rules defined until now by the
Member States in accordance with their own national    legislation; whereas,
in view of the special relationship existing between the Community and such
countries and territories, within the strict limits of preserving the
actual flow of imports from those OCT which enjoy preferential
arrangements, the concept of originating product defined in this Regulation
should take account, of, the conditions under which some of these products .
are obtained in such countries and territories,
HAS ADOPTED THIS*REGULATION
                                    Art icle 1
                                Or i g i n cr iter i a
For the purposes of implementing the provisions relating to the
preferential tariff arrangements granted by the Community in respect of
certain mineral products and certain products of the chemical or allied
industries referred to in Annex II and originating in the overseas
countries and territories referred to in Part IV of the Treaty establishing
the European Economic Community, hereinafter referred to as "OCT", the
following shall be considered as products originating in the OCT:
(a)     products wholly obtained in the OCT, the Community or the ACP
        States;
(b)     products obtained in an OCT, in the manufacture of which products
        other than those referred to at point (a) and hereinafter referred
        to as "non-originating materials" have been used, provided that such
        materials have been sufficiently worked or processed within the
        meaning of Art icle 3.
 ---pagebreak---                                        - 3 -
                                    Art icle 2
                            Wholly obtained products
The following shall be considered as wholly obtained in the OCT, the
Community or the ACP States     within the meaning of Article 1(a):
(a)     products extracted   from their soil or from their       seabed;
(b)     products taken from their seabed or beneath the seabed outside their
         territorial waters, if, for the purposes of exploitation, they have
        exclusive rights to such soil or subsoil;
(c)     products produced there exclusively        from products specified in (a)
        and (b).
                                    Ar t i c le ,3
                        Sufficiently processed products
1. For the purposes of Article K b ) , non-originating materials are
    considered to be sufficiently worked or processed when the obtained
    product specified in columns 1 and 2 of the list in Annex II fulfils the
    conditions set out in column 3, subject to the provisions contained in
    paragraphs 2 to 7.
    The expressions "chapters" and "headings" used in this Regulation shall
   mean the chapters and headings (four-digit codes) used in the
    Nomenclature which makes up the Harmonized Commodity Description and
   Coding System (hereinafter referred to as the "Harmonized System"
   or H S ) .
   The expression "classified" shall refer to the classification of a
   product or material under a particular heading.
 ---pagebreak--- 2. Where in the list in Annex II a percentage rule is applied in
   determining the originating status of a product obtained in an OCT, the
   value added by the working or processing shall correspond to the ex-
   works price of the product obtained, less the customs value of third-
   country materials imported into the Community, the ACP states or the
   OCT.
3. The term "value" in the list in Annex II shall mean the customs value at
   the time of the import of the non-originating materials used or, if this
    is not known and cannot be ascertained, the first ascertainable price
   paid for the materials in the territory concerned.
   Where the value of the originating materials must be ascertained, the
   provisions contained in the first subparagraph of this point must be
   applied mutât i s mutand i s.
4. The term "ex-works price" in the list in Annex II shall -mean the price
   paid to the manufacturer    in whose undertaking the last working or
   processing is carried out, provided the price includes the value of all
   the materials used in manufacture, minus any internal taxes which are,
   or may be, repaid when the product obtained is exported.
5. "Customs value" shall be understood as meaning the value established in
   accordance with the Agreement on the implementation of Article VII of
   the General Agreement on Tariffs and Trade (GATT), concluded in Geneva
   on 12 ApriI .1979.
6. For-the purposes of paragraphs 1 to 5, the following shall be considered
   as insufficient working or processing to confer originating status,
   whether or not there is a change of heading:
 ---pagebreak---                                       5 -
   (a) operations to ensure the preservation of products in good condition
       during transport and storage (ventilation, spreading out, drying,
       chilling, placing in salt, sulphur dioxide or other aqueous
       solutions, removal of damaged parts and I ike operations);
   (b) (i)   changes of packaging and breaking up and assembly of
             cons ignments;
        (ii) simple placing in bottles, flasks, bags, cases, boxes, fixing
             on cards or boards etc., and all other simple packaging
             operat ions ;
   (c) affixing marks, labels and other like distinguishing sjgns on
       products or their packaging;
   (d) (i)   simple mixing of products of the same kind, where one or more
             components of the mixture do not meet the conditions laid down
             in this Regulation to enable them to be considered as
             originating in an ACP State, the Community or an OCT;
                                      i
       (ii) simple mixing of products of different kinds, unless one or
             more components of the mixture meet the conditions laid down in
             this Regulation to enable them to be considered as originating
             in an ACP State, the Community or an OCT and provided that such
             çomponent(s) contribute(s) to the determination of the
             essential characteristics of the finished product;
   Ce) a combination of several operations specified in points (a) to ( d ) . .
7. For the purposes of heading Nos ex 2707, 2713 to 2715, ex 2901, ex 2902
   and ex 3403 mentioned in column 1 of the list in Annex II, simple
   operations such as cleansing, decanting, desalting, water separation,
   filtering, colouring, marking, obtaining a given sulphur content as a
   result of mixing products with different sulphur contents, any
   combination of these operations or like operations do not confer origin.
 ---pagebreak---                                      - 6
   However, in the case of crude petroleum oils under heading No ex 2709
   mentioned in column 1 of the list in Annex II, simple operations such as
   decanting, desalting, water separation, filtering, marking and any
   combination of these operations are considered as operations which
   confer origin.
                                   Art icle 4
                               Neutral elements
In order to determine whether goods originate in an ACP State, in the
Community or in an OCT, it shaI I not be necessary to establish whether the
electrical power, fuel plant and equipment, and machines and tools used to
obtain such goods or any materials or products used in the course of
product ion which do not enter into the final composition of the goods
originate in third countries or not.
                                   Art ic le 5
                               Va lue tolerance
Notwithstanding the provisions of Article 3(1) and (2), non-originating
products may be used in the manufacture of a specific product provided that
their value does not exceed 10% of the ex-works value of the finished
product and subject to the conditions set out in note 4.2 to Annex I.
                                   Art icle 6
                                - Cumulation
1. For the purposes of this title, the OCT shall be considered as a .single
   territory.
 ---pagebreak---                                         7 -
2. Where products wholly obtained in the Community or in the ACP States are
   worked or processed in the OCT, they shall be considered as having been
   wholly obtained in the OCT.
3. Working or processing carried out in the Community or in the ACP States
   shall be considered as having been carried out in the OCT when the
   materials undergo working or processing.
4. Paragraphs 2 and 3 are applicable to any working or processing carried
   out in the OCT, including the operations listed in Article 3(6) and (7).
                                   Art i cle 7
                           .A Ilocat ion of or ig in
Originating products consisting of materials wholly obtained or
sufficiently processed in two or more OCT or in one or more ACP States and
in one or more OCT shall be considered -as products originating in the OCT
or in the ACP State in which the last working or processing was carried
out, provided that such working or processing goes beyond the insufficient
operations contained in Article 3(6) and/or beyond the operations which do
not confer origin contained in Article 3(7) or consists of a combination of
such operat ions.
 ---pagebreak---                                       .8 -
                                  Art icle 8
                              Direct transport
1. The preferential tariff arrangements referred to in Article 1 apply only
   to products or materials which are transported between the territory of
   the ACP States, the Community or the OCT without entering any other
   territory. However, goods which constitute a single consignment may be
   transported through terri tory other than that of the ACP States, the
   Community or the OCT and, if necessary, transhipped or placed in
   temporary warehousing in such territory, provided that the goods have
   remained under the surveiI lance of the customs authorities in the
   country of transit or of warehousing and that they have not undergone
   operations other than unloading, reloading or any operation designed to
   preserve them in good condition.
   Products which are transported by pipeline across territory other than
   that of the OCT shall also be considered as having been transported
   directly from the OCT into the Community. .
2. Evidence that the conditions referred to in paragraph 1 have been
   fulfilled shall be supplied to the responsible customs authorities by
   the product ion of :
   (a) a through bill of lading issued in the exporting beneficiary country
       or territory covering the passage through the country of transit; or
   (b) a certificate issued by the customs authorities of the country of
       transit:
       giving an exact description of the goods,
       stating the dates of unloading and reloading of the goods or of
       their embarkation or disembarkation, identifying the ships used,
 ---pagebreak---         certifying the conditions under which the goods remained in the
        transit country; or
   (c) failing these, any substantiating documents.
                                    Art icle 9
                            Territorial requirement
The conditions set out in Articles 1 to 8 relative to the acquisition of
originating status must be fulfilled without interruption in the Community,
the ACP States or the OCT.
If originating goods exported from the Community, ACP States or OCT to
another country are returned, they must be considered as non-originating
unless it can be demonstrated to the satisfaction of the customs
author i t ies that :
-  the goods returned are the same goods as the goods exported, and
-  they have not undergone any operation beyond that which is necessary to
   preserve them in good condition while in that country or while being
   exported.
                                   Art icle 10
                               Ceuta and MeliI la
1. For the purposes of the provisions of Decision 86/47/EEC, as last
   extended by Decision 90/6^9/EEC, this Regulation shall apply mutat is
   mutandis subject to the special conditions set out in paragraphs 2 to 8
   hereafter.
 ---pagebreak---                                       - 10
2. The term 'Community' used in this Régulât ion does not cover Ceuta and
   Melilla. The term 'products originating in the Community' does not cover
   products originating in Ceuta and Me M I la.
3. The following paragraphs shall apply instead of Article 6(2) and (3) and
   references to that Article shall apply mutatis mutandis to this Article.
4. Where products wholly'obtained- in Ceuta and Melilla, in the ACP States
   or in the Community are worked or processed in the OCT, they shall be
   considered as having been wholly obtained in the OCT.
5. Working or processing carried out in Ceuta and Melilla, in the ACP
   States or in the Commun!ty sha I I be considered as having been carried
   out in the OCT where the products obtained are subsequent I y worked or
   processed in the OCT.
6. Where products wholly obtained in the ACP States, in the- OCT or in the
   Community are worked or processed in Ceuta and Me IiI la, they shall be
   considered as having been wholly obtained in Ceuta and Melilla.
7. Working or processing carried out in the ACP States, in the OCT or in
   the Community shall be considered as having been carried out in Ceuta
   and MeliI la, where the products obtained are subsequently worked or
   processed in Ceuta and Melilla.
8. Ceuta and Mel it la sha I I be considered as a single territory.
 ---pagebreak---                                    - 11
                                 Article 11
This Regulation shall apply without prejudice to the Protocol to the Treaty
establishing the European Community on imports into the European Community
of petroleum products refined in the Netherlands Antilles, and in
particular Article 6 thereof.
                                 Article 12
This Regulation shall enter into force on the seventh day following its
publication in the Official Journal of the European Communities.
This Regulation shall be binding in its entirety and directly applicable in
all Member States.
Done at Brussels,
                                                For the Council
                                                The President
 ---pagebreak---                                •1<t
                                   ANNEX
                                    NOTES
Foreword
These notes shall apply, where appropriate, to all products manufactured
using non-originating materials.
Note 1
1.1    The first- two columns in the list describe the product obtained. The
       first column gives the heading number or chapter number used in the
       Harmonized System and the second column gives the description of
       goods used in that system for that heading or chapter. For each
       entry in the first two columns a rule is specified in column 3.
       Where, in some cases, the entry in the first column is preceded by
       an 'ex', this signifies that the rule in column 3 applies only to
       the part of that heading or chapter as described in column 2.
1.2    Where several heading numbers are grouped together in column 1 or a
       chapter number is given and the description of products' in column 2
       is therefore given in general terms, the adjacent rule in column 3
       applies to all products which, under the Harmonized System, are
       classified in headings of the chapter or in any of the headings
       grouped together in column 1.
1.3    Where there are different rules in the list applying to different
       products within a heading, each indent contains the description of
       that part of the heading covered by the adjacent rule in column 3.
 ---pagebreak--- Note 2
2.1    The term 'manufacture' covers any kind of working or processing
       including assembly or specific operations. However, see Note 3.5
       below.
2.2    The term 'material' covers any ingredient, element, raw material,
       material, component or part, etc., used in the manufacture of the
       product.
2.3    The term 'product' refers to the product obtained, even if it is
       intended for later use in another manufacturing operation.
2.4    The term 'goods' covers both materials and products.
Note 3
3.1    The working or processing required by a rule in column 3 has to be
       carried out only in relation to-the non-originating materials used.
       The restrictions contained in a rule in column 3 likewise apply only
       to the non-originating materials used.
3.2    If a product made from non-originating materials which has acquired
       originating status during manufacture by virtue of the change of
       heading rule or  its own list rule is used as a material  in the
       process of manufacture of another product, then the rule applicable
       to the pr.oduct in which it is incorporated does not apply to it.
 ---pagebreak---                                •n V
3.3    Even if the change of heading rule or the other rules contained in
       the list are satisfied, the finished product shall not acquire
       originating status if the operation is insufficient within the
       meaning of Article 3(6).
3.4    The unit used for the application of the origin rules shall be the
       product considered as the basic unit when determining classification
       using the nomenclature of the Harmonized System.
       Accordingly, where,  under general rule 5 for the interpretation of
       the Harmonized System, packing is included with the product for
       classification purposes, it shall be considered as forming a whole
       with the product for the purposes of determining origin.
Note 4
4.1    The rule in the list represents the minimum amount of working or
       processing required; thus move-extensive .working or processing also
       confers originating status but less extensive working or processing
       cannot confer origin. Thus if a rule says that non-originating
       material at a certain level of manufacture may be used, the use of
       such material at an earlier stage of manufacture is allowed and the
       use of such mater iaI at a later stage is not.
 ---pagebreak---                              1r
4.2 If in a rule in the list two or more percentages are given for the
    maximum value of non-originating materials that can be used, then
    these percentages may not be added together. The maximum value of
    all the non-originating materials used may never exceed the highest
    of the percentages given. Furthermore, these provisions must not
    result in individual percentages applying to particular materials
    being exceeded.
    This note shall also apply to the permitted value laid down in
    Art icle 5.
 ---pagebreak---                            1G                                   ANNEX II
HS CODE        Description of product     Working or processing carried
                                          out on non-originating materials
                                          that confers originating status
ex 2707 . Oils in which the weight of the Operations of refining and/or
          aromatic constituents exceeds   one or more specific process(es)
          that of the non-aromatic        in accordance with Appendix I
          constituents, being oils
          similar to mineral oils         Other operations in which, all
          obtained by distillation of     the materials used are
          high temperature coal tar, of   classified within a heading
          which more than 65% by volume   other than that of the product.
          distils at a temperature of up  However, materials classified
          to 250°C (including mixtures of within the same heading may be
          petroleum spirit and benzole),  used provided that their value
          for use as power or heating     does not exceed 50% of the ex- <
          fuels.                          works price of the product
                                          Blending in accordance with
                                          Appendix III.
ex 2709   Crude oils obtained from        Destructive distillation of
          bituminous minerals.            bituminous materials.
2710 to   Petroleum oils and oils         Operations of refining and/or
2712      obtained from bituminous        one or more specific process(es)
          materials, other than crude;    in accordance with Appendix II
          preparations not elsewhere
          specified or included,          Other operations in which all
          containing by weight 70% or     the materials used- are
         more of petroleum oils or of     classified within a heading
          oils obtained from bituminous   other than that of the product.
         materials, these oils being the  However, materials classified
          basic constituents of the       within the same heading may be
          preparations.                   used provided that their value
          Petroleum gases and other       does not exceed 50% of the ex-
         gaseous hydrocarbons.            works price of the product
          Petroleum jelly; paraffin wax,
         microcrystalline petroleum wax,  Blending in accordance with
          slack wax, ozokerite, lignite   Appendix III.
         wax, peat wax, other mineral
         waxes and similar products
         obtained by synthesis or by
         other processes, whether or not
         coloured.
 ---pagebreak---                                11
2713 to Petroleum coke, petroleum       Operations of refining and/or
2714    bitumen and other residues of   one or more specific process(es;
        petroleum oils or of oils        in accordance with Appendix I
        obtained from bituminous
        materials.                      Other operations in which all
        Bitumen and asphalt, natural;   the materials used are
        bituminous or oil shale and tar classified within a heading
        sands; asphaltites and          other than that of the product.
        asphaltic rocks.                However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 50% of the ex-
                                        works price of the product
                                        Blending in accordance with
                                        Appendix III.
2715    Bituminous mixtures based on
        natural asphalt, on natural
        bitumen, on petroleum bitumen,
        on mineral tar or on mineral
        tar pitch:
        - Blends of crude petroleum     Operations of refining .and/or
        oils with water and additives   one or more specific process(es)
        or heated and blended with      in accordance with Appendix 1
        other crude petroleum oils
                                        Other operations in which all
                                        the materials used are
                                        classified within a heading
                                        other than that of the product.
                                        However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 50% of the ex-
                                        works price of the product
                                        Blending in accordance with
                                        Appendix III.
        - Other                         Operations of refining and/or
                                        one or more specific process(es)
                                        in accordance with Appendix I
                                        Other operations in which all
                                        the materials used are
                                        classified within a heading
                                        other than that of the product.
                                        However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 50% of the ex-
                                        works price of the product.
 ---pagebreak---                                 4î
ex 2901 Acyclic hydrocarbons for use as Operations of refining and/or
        power or heating fuels.         one or more specific process(es)
                                        in accordance with Appendix I
                                        Other operations in which all
                                        the materials used are
                                        classified within a heading
                                        other than that of the product.
                                        However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 50% of the ex-
                                        works price of the product
                                        Blending in accordance with
                                        Appendix III.
ex 2902 Cyclanes and cyclenes (other    Operations of refining and/or
        than azulenes), benzene,        one or more specific process(es)
        toluene, xylenes, for use as    in accordance" with Appendix I
        power or heating fuels.
                                        Other operations in which all
                                        the materials used are
                                        classified within a heading
                                        other than that of the product.
                                        However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 00% of the ex-
                                        works price of the product.
 ---pagebreak---                                  19
ex 3403 Lubricating preparations        Operations of refining and/or
        containing petroleum oils or    one or more specific process(es)
        oils obtained from bituminous    in accordance with Appendix I
        materials, provided they
        represent less than 7 0 % by    Other operat ions in which all
        weight.                         the materials used are
                                        classified within a heading
                                        other than that of the product.
                                        However, materials classified
                                        within the same heading may be
                                        used provided that their value
                                        does not exceed 5 0 % of the ex-
                                        works price of the product.
ex 3404 Artificial waxes and prepared   Manufacture in which all the
        waxes with a basis of paraffin, materials used are classified
        petroleum waxes, waxes obtained within a heading other than that
        from bituminous materials,      of the product. However,
        slack wax or scale wax.         materials classified within the
                                        same heading may be used
                                        provided that their value does
                                        not exceed 5 0 % of the ex-works
                                        price of the product.
ex 3811 Prepared additives for          Manufacture in which the value
        lubricating oil, containing     of all the materials of heading
        petroleum oils or oils obtained No 3811 used does not exceed 5 0 %
        from bituminous materials.      of the ex-works price of the
                                        product.
 ---pagebreak---                                                            Append i x I
  For the purposes ôf heading Nos ex 2707, 2713 to 2715, ex 2901, ex 2902 and
  ex 3403, the "specific processes" are the following.-
  (a)    vacuum distillation;
t
  (b)    redistillation by a very thorough fractionation process;1
  (c)    cracking;
  (d)    reforming;
  (e)    extraction by means of selective solvents;
  (f)    the process comprising all the following operations: processing with
         concentrated, sulphuric acid, oleum or sulphuric anhydride;
         neutralization with alkaline agents; decolorization and purification
         with naturally active earth, activated earth, activated charcoal or
         bauxite;
                                                                        l
  (g)    polymerization;                        .
  (h)    a Iky I at ion;
  (i)      isomer i zat ion-,
  1  See Additional Explanatory Note 4 (b) to Chapter 27 of the Combined
     Nomenclature.
 ---pagebreak---                                 ?n
                                                       APPENDIX
For the purposes of heading Nos 2710 to 2712, the "specific processes" are
the fol lowing:
(a)      vacuum distillation;
(b)      redistillation by a very thorough fractionation process;1
(c)      cracking;
(d)      reforming;
(e)      extraction by means of selective solvents-,
(f)      the process comprising all the following operations: processing
         with concentrated sulphuric acid, oleum or sulphuric anhydride;
         neutralization with alkaline agents; decolorization and
         purification with naturaIly active earth, activated earth,
         activated charcoal or bauxite;
(g)      polymerization;
(h)      a Iky I at ion;
( i j)     isomer izat ion;
(k)      (in respect of heavy oils falling within heading No ex 2710 only)
         desulphurization with hydrogen resulting in a reduction of at least
         85% of the sulphur content of the products processed (ASTM D 1266-
         59 T method);
(I)      (in respect of products falling within heading No 2710 only)
         deparaffining by a process other than filtering;
1  See Additional Explanatory Note 4 (b) to Chapter 27 of the Combined
   Nomenclature.
 ---pagebreak---                          2 1
(m) (in respect of heavy oils falling within heading No ex 2710 only)
    treatment with hydrogen at a pressure of more than 20 bar and a
    temperature of more than 250'C with the use of a catalyst, other
    than to effect desulphurization, when the hydrogen constitutes an
    active element in a chemical reaction. The further treatment with
    hydrogen of lubricating oils of heading No ex 2710 (e.g.
    hydrofinishing or decolorization) in order, more especially, to
    improve colour or stability shall not, however, be deemed to be a
    specif ic process;
(n) (in respect of fuel oils falling within heading No ex 2710 only)
    atmospheric distillation, on condition that less than 30% of these
    products distils, by volume, including losses, at 300'C by the ASTM
    D 86 method;
(o) (in respect of heavy oils other than gas oils and fuel oils falling
    within heading No ex 2710 only) treatment by means of a
    high-frequency electrical brush-discharge.
 ---pagebreak---                                Z2>
                                                Appendix III
Operations involving the (extensive) mixing or blending of crudes,
residues, gasolene, naphta and a multitude of various blend components are
acceptable within the meaning of heading Nos ex 2707; 2710 to 2712; 2713
and 2714, 2715 and 2901 only if they fulfil the following conditions:
- the product obtained should possess technical, physical or chemical
  qualities different from the characteristics of the imported products;
- a real objective distinction between the products in question before and
  after the working and processing in question should be demonstrable;
- on the other hand, simple operations such as cleansing, desulphurization,
  colouring, combinations of such operations, or similar operations
  essentially resulting in a commercial upgrading of the finished product
  rather than making a significant contribution to its specific utilities
  do not confer origin;
- the mixing and blending should be carried out in a purpose-built plant
  which includes a laboratory so as to enable the correct composition of
  the finished products to be adequately controlled and ensured by virtue
  of the specialized knowledge and skills available.
- the finished products should possess the specifications indicated by and
  essential to the purchaser, e.g. relating to:
 ---pagebreak---                                                                Z
                                                                     r
-    density;
-    v i s c o s i ty;
-    sulphur content ;
-    asphaltene content;
-    ash;
-    water ;
-    sediment ;
-    flash point ;
-    pour point ;
-    conradson carbon;
-    cetane number ;
-   metals: (a) vanadium
                   (b) nickel
                   ( c ) a I urn i n i urn
                   (d) s iI icon
                   (e) sodium;
- c o m p a t ibiIi ty;
- s t a b i I i ty;
- heat content ;
- colour ;
- vapour pressure;
- boiIing point ;
- cloud point ;
-volatility.
When considering a particular process, computer-assisted "pro forma"
p r o c e s s e s m u s t b e m a d e t o e n s u r e that t h e s e l e c t i o n o f c o m p o n e n t s w i l l m e e t
the required quality parameters after processing.
 ---pagebreak---                               Zs
                             FINANCIAL STATEMENT
Proposal for a Council Regulation (EC) on the definition of originating
products applicable to certain mineral products and to certain products of
the chemical or allied industries for the purposes of the preferential
tariff arrangements granted by the European Economic Community to the
overseas countries and territories (OCT)
1. Budget heading involved
   Chapter 12, Article 120 (zero rate customs duty)
2. Legal basis
   Treaty establishing the European Community (Article 113); Council
   Decision 91/482/EEC of 25 July 1991 on the association of the overseas
   countries and territories with the European Economic Community (OJ
   L 263, 19.09.1991).
3. Objective
   Harmonization of the preferential rules of origin applied to OCT, in the
   light of the completion of the single market in 1993.
4. Cost of the measure
   The measure will not affect the Community budget, since it is solely
   intended to harmonize the origin rules applied in the Community to the
   products in question, which already enjoy preferential treatment under
   the Member States' national legislation.
 ---pagebreak---                                                                      ISSN 0254-1475
                                                               COM(94) 448 final
                                                      DOCUMENTS
EN                                                                         1102
                                 Catalogue number : CB-CO-94-484-EN-C
                                                             ISBN 92-77-81398-9
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