CELEX: 51983PC0579
Language: en
Date: 1983-10-10
Title: Proposal for a COUNCIL REGULATION (EEC) on the application of Decision No of the EEC-Israel Cooperation Council amending Article 30 of Protocol No 3 to the Agreement between the European Economic Community and the State of Israel (submitted to the Council by the Commission)#Draft DECISION No OF THE EEC-ISRAEL COOPERATION COUNCIL amending Article 30 of Protocol No 3 to the Agreement between the European Economic Community and the State of Israel

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COM (83) 579
Vol. 1983/0218
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                     C0MC83) 579 final
                                                    Brussels, 10 October 1983
                                 Proposai for a
                            COUNCIL REGULATION (EEC)
 on thè application of Decision No             of the EEC-Israel Cooperation
  Council amending A r t i d e 30 of Protocol No 3 to the Agreement between
         the European Economic Community and the State of Israel
              (submitted to the Council by the Commission)
                      .  ^
                                            Draft
                  ISION No ./·>·;/ OF THE EEC-ISRAEL COOPERATION COUNCIL
      amending Article 30 of Protocol N· 3 to the Agreement between the
      European Economic Community and the State of Israel
C0MC83) 579 final
 ---pagebreak---                             EXPLANATORY MEMORANDUM
Article 30 of Protocol No 3 to the EEC-Israel Agreement, on the definition
of the concept of originating products and arrangements for administrative
cooperation, prohibits any kind of drawback or remission of customs duties
on non-originating products used in the manufacture of originating products
from 1 January 1984 onwards. This "no drawback" rule is designed to ensure
that application of the Agreement does not lead to the deflection of trade
where the customs duties on preferential trade have become negligible.
The Community abolished customs duties on imports of nearly all products
originating in Israel on 1 July 1977, but the dismantling of Israel's
tariffs on most manufactured imports from the Community (listed in Annex A
to Protocol No 2 ) has been set back by two years^. This means that the
reduction in force on 1 January 1984 will be 50 %, not 80 %.
If the no drawback rule comes into force on 1 January 1984 as planned,
Community businessmen will be operating under a twofold disadvantage, since
their exports to Israel will still be liable for 50 % duty, and they will be
unable to recover the import duties they have paid on third-country products
used in the manufacture of the exported goods. This is a matter for particular
concern in that some 90 % of Community exports to Israel consist of manufactures,
and it is to manufactures that the no drawback rule applies.
 It should be noted that it was the Israeli authorities, concerned about the
short-term administrative and economic problems which the introduction of
the no drawback rule could create for Israeli exports, who raised the question
of setting back the date laid down in Article 30.
   Second additional protocol to the Agreement, in OJ No L 102, 14 April 1981
 ---pagebreak---                                - 2 -
Since both parties have an interest, therefore, in seeing the introduction
of the prohibition delayed, and in order to bring the clause into line with
the tariff timetable, it is proposed that the date for implementation of
Article 30 of Protocol NO 3 be changed from 1 January 1984 to 1 January 1986.
   4
 ---pagebreak---                              Proposal for a
                        COUNCIL REGULATION (EEC)
on the application of Decision No         of the EEC-Israel Cooperation Council
amending Article 30 of Protocol No 3 to the Agreement between the European
Economic Community and thé State of Israel
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community,
and in aprticular Article 113 thereof,
Having regard to the proposal from the Commission,
Whereas the Agreement between the European Economic Community and the
State of Israel"*· was signed on 11 May 1975 and entered into force on
1 July 1975 ;
Whereas pursuant to Article 25 of Protocol No 3 on the definition of the
concept of "originating products" and arrangements for administrative co­
operation, which is an integral part of the Agreement, the Cooperation
Council   has adopted Decision No         amending Article 30 of the said
Protocol No 3 ;
Whereas that Decision should be made operative in the Community,
HAS ADOPTED THIS REGULATION :
Article 1
Decision No         of the EEC-Israel Cooperation Council, annexed to this Regulation,
shall be applicable in the Community
1 OJ No L 136, 28.5.1975, p. 1
 ---pagebreak---                               - 2 -
Article 2
This Regulation shall enter into force on the third 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---                                   Draft
            DECISION No       OF THE EEC-ISRAEL COOPERATION COUNCIL
amending Article 30 of Protocol No 3 to the Agreement between the European
Economic Community and the State of Israel
THE  COOPERATION COUNCIL,
Having regard to the Agreement between the European Economic Community and
the State of Israel signed in Brussels on 11 May 1975,
Having regard to Protocol No 3 on the definition of the concept of "originating
products" and arrangements for administrative cooperation·*·, hereinafter referred
to as Protocol No 3, and in particular Article 25 thereof,
Whereas at present Article 30 of Protocol No 3 stipulates that unless the Coope­
ration Council  decides otherwise, no drawback or remission of any kind may
be granted from customs duties in respect of non-originating products used
in the manufacture of originating products as from 1 January 1984 ;
                                                                                2
Whereas the second additional protocol to the Agreement, concluded in 1981 ,
extends by two years the process of dismantling tariffs on products listed
in Annex A to Protocol No 2 to the Agreement ; whereas for this reason the
entry into force on 1 January 1984 of the prohibition contained in Article 30
of Protocol No 3 could have consequences damaging to preferential trade ;
Whereas it is Israel's wish to have more time to adjust its customs
arrangements to allow for implementation of the prohibition ;
Whereas the introduction of the prohibition should be delayed for two years,
in line with the timetable in force for tariffs,
                                                                        . . ./ ...
1 OJ No L 190, 29.7.1977, p. 3
2 OJ No L 102, 14.4.1981   p. 1
 ---pagebreak---                                 - 2 -
HAS DECIDED AS FOLLOWS :
Article 1
The text of Article 30 of Protocol No 3 to the Agreement is hereby replaced
by the following :
"Article 30
1.   As from 1 January 1986 no drawback or remission of any kind may be
     granted from customs duties in the Community or in Israel in respect
     of products referred to in Article 1 of Protocols 1 and 2 and used
     in manufacture which do not originate in the Community or Israel.
2.   In this and the preceding Articles, the term 'customs duties' also
     means charges having an equivalent effect to customs duties.
Article 2
This Decision shall enter into force on
 Done at Brussels,                              For the Cooperation Council
                                                       The President