CELEX: 51976PC0324
Language: en
Date: 1976-06-23
Title: Draft Joint Committee Decision (EEC-Morocco) derogating for 1976 and 1977 from the definition of the concept of "originating products" to take account of Morocco's special situation in certain textile products#Proposition for a Council Regulation (EEC) derogating for 1976 and 1977 from the provisions concerning the concept of "originating products" contained in the Agreement on co-operation and the interim Agreement between the European Economic Community and the Kingdom of Morocco (submitted by the Commission to the Council)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (76) 324
Vol. 1976/0096
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 ---pagebreak---   COMMISSION OF THE EUROPEAN COMMUNITIES
                                         COM(76)324 final
                                         Brussels / 23 June 1976           ,
                                (
               Draft Joint Committee_ Deci si on ( EEC-Morocco )
           derogating for 1976 and 1977 from the definition of the
           concept of "originating products " to take account of Morocco 's
           special situation in certain textile products
                         in for a Council Regulation
           derogating for 1976 and 1977 from the provisions concerning
           the concept of "originating products " contained in the Agreement
           on co-operation and the interim Agreement between the European
           Economic Community and the Kingdom of Morocco
                     ( submitted by the Commission to the Council )
C0MC76 ) 324 final
 ---pagebreak---                               EXPLANATORY NOTE
The new Lists A and B annexed to the Origin Protocol to the Agreement
with Morocco have introduced a 6eriou6 barrier to exports to the Commu­
nity of Moroccan clothing classified under headings 61.01 to 61.0^.
These products , which , under the 1969 Origin Protocol , satisfied the
conditions of origin since they were manufactured from unbleached
fabrics from third countries , will no longer be regarded as originating
products upon the entry into force of the new Agreement and the new
List A rules , which no longer permit the use of unbleached fabrics from
third countries , since they provide that weaving mu6t be carried out
in Morocco . These new rules , which are more restrictive in the case in
point , are , of course , part of a 6et of rules which the Community has
proposed to its Mediterranean co-contracting parties with a view to
harmonizing List's A and B. They are in some cases more liberal , and
in others more restrictive , than the old rules . During the negotiations
with Morocco , the Moroccans asked that a whole series of modifications be
made to the proposed rules concerning the form of cumulation to be chosen
( which was much more liberal than that actually selected ), the definition
of the expression " their vessels " and also various headings in List A
covering textiles , mechanical engineering and electronics in particular .
The negotiations proved successful as regards origin , solutions in par­
ticular being found for the problems of cumulation and the powers of the
Council . With regard to the amendments to List A requested by Morocco ,
the Community stated its willingness to examine at a later date any
practical difficulties that arose .
Close contacts and a survey carried out with the Moroccan producers
concerned have revealed that a number of problems exist in the case of
some products covered by Chapters 58 and 61 and also heading 51 . 01*.
Generally speaking the survey shows that links between Morocco and the
Community are very close . Morocco is a traditi-nal customer of several
Community countries . In agreement with the Moroccan authorities , it has
been possible , on the basis of this close relationship , to disregard
the products in question covered by heading 51*0^ and Chapter 58 , in res­
pect of which products Morocco is no longer seeking derogations from
List A , thereby being compelled to rely on the Community for continuing
supplies of intermediate products .
The only outstanding problems concern the products covered by headings
61.01 , 61.02 , 61.03 and 61 . 04 . Ever since the time of the country 's
earlier relations with France , the manufacturing process for these
goods in Morocco has been . influenced by the rules of origin . Whenever
the rules were changed , Morocco adapted its production processes to the
new . more restrictive rules .
 ---pagebreak---                                   - 2 -
For instance , thf liberal rules previously applied by France were
replaced in 1969 by the rules banning the working of dyed fabrics from
third countries . In order to comply with these new rules on origin ,
Moroccan industrialists purchased dyed fabrics from the EEC . After a
number of years the EEC was no longer in a position to Eupply Morocco
with dyed fabrics and the industrialists concerned have had to find
other ways of satisfying the rules of origin laid down in the 1969
EEC-Morocco Agreement . They had to buy from France an entire dyeing
 factory , which included among other things German machinery and which
has now been installed in Morocco . In doing so , they have had to tackle
and solve major problems never before experienced by the ready-made clothing
industry , since dyeing is , for that industry , a completely new process
pertaining rather to the chemical industry . So as not to be dependent
on third countries , Moroccan dyers have set up consultancy and design
 firms to deal with the mixtures of colours to be applied to the various
 fabrics . At any event , a new dyeing industry was set up in Morocco
solely to take account of the rules of origin , for compared with the
ready-made clothing industry it employs very few workers .
In addition to dyeing , the industry in Morocco undertakes the printing
of certain fabrics . It is , incidentally , easy to establish that , with
regard to the concept of sufficient processing , both processes , printing
and dyeing , are equally important , dyeing being even more complicated
than printing .
The 1969 rules of origin confer the status of originating products on
 fabrics printed by the partner country subject to certain conditions
 ( List D ) and on cldhing obtained after dyeing operations have been
carried out on unbleached fabrics imported from third countries and
also after operations resulting in the working of fabrics printed in
Morocco . Consequently , in these particular sectors * Morocco has been
able , under the 19&9 Agreement , to export to the Community clothing
covered by Chapter 61 and originating in Morocco . Although , in
the exports totalled about 2 200 metric tons , or DH 90 31 ^ 000 ( DH 1 »
approx . FF 0.910 ), the Moroccan trade balance for textiles is still
in deficit . ( 1 ).
Once the new List A rules enter into force , under which dyeing carried
out in Morocco will no longer be regarded as a manufacturing stage that ,
followed by the making up of the fabrics in that country , confers the
status of originating products on clothing obtained in Morocco , the
articles of clothing in question will no longer be regarded as origi­
nating products . This will bring about a deterioration in Morocco 's
existing trade deficit with the Community as regards textiles in par­
ticular . Morocco will have no option but to rely on supplies of unbleached
fabrics which originate in the Community or in another Maghreb country .
Moroccan industrialists have looked into the matter without coming up
with any solution.' Consequently , Morocco , anxious as always to comply
with the new rules on origin , has stepped up its plans to establish a
local weaving industry . Construction of factories , the capital for which
will come , as in the case of the ready-made clothing industry and the
dyeing industry , from domestic sources or from joint Moroccan/Community
sources , is expected to start next year .
( 1 ) See Annex I for breakdown of exports in 1975 *
 ---pagebreak---                                  - 3 -
There are also plans to extend the production capacity of a number of
existing weaving factories . It will , of course , be some time before
these plans are implemented .
Accordingly , Morocco has requested a derogation from the new rulo of
origin for a period of five years as from the entry into force of new
Origin Protocol . The survey carried out has shown that this derogation
could be limited to an annual amount of 2 500 tons . It is proposed that
the Commission decide in favour of this derogation given that the quan­
tities in question were previously exported under the 1969 Agreement
and that , as explained above , Morocco has ,, in the past , endeavoured 'to
comply with the rules of origin .
Customs experts from the Member States have been consulted on this
draft ; they have suggested that from a technical point of view some
provisions concerning control should be included in the text and they
said that they would need to be assured of the non-availability of
unbleached cloth originating in the Community .
In regard to the first point Article k of the draft takes account of
the observations made by the experts * he concerns the non-availability
of the products concerned in the Community , these products could perhaps
be supplied by one or more Member State , but only at non-competitive
prices . Given that this case consists of allowing Morocco to continue
for two years an already established activity on the basis of existing
contracts , it seems that a possible raising' of the price would be in
contradiction with the aim desired .
As this derogation has to enter into force as from the date of entry
into force of the provisions of the intermediary Agreement , the Com­
mission should recommend to the Council to adopt the draft of the EEC-
Morocco Joint Committee Decision in Annex II , as the common position of
the Community for that Joint Committee . In addition , before that the
Joint Committee can adopt this Decision , it is necessary that the Com­
mission recommends to the Council to adopt the proposed Regulation in
Annex III , in order that the effective entry into force of the provisions
concerned shall be 1 July 1976 .
It is proposed that this derogation shall be granted for a two-year period .
However , taking into consideration the period of applicability of the
interim agreement , the draft decision and the proposition for a regulation
are for the time being limited to the JO June 1977*
 ---pagebreak---                                                               t * -                                                           ANNEX I
               Exports of originating products from Morocco under the previous rules
                                   These figures cover 11 months of 1975
                       ...  I
              I
      EEC   !
  COUNTRIES   [          FRANCE                 GERMANY                  ITALY                      B.L. En
                                                                                                          • W •
              i
   Tariff       Value m       Metric    Value xn      Me trie   Value m            Metric    Value in       Metric
  headings       DH ' 000       tons     DH • 000       tons     DH ' 000            tons     DK ' 000        tons
   61.01         30.837          927   ΠΓΛΐδ            134         584 ,            16     117,4651          255
| 61.02           8,444          162     3.147          103      1,168               33            184            3
   61.03         11.683          194       999           15            5               0,2         244          12
   61.04    |         854         10          . 1      Nil          Nil             Nil             63
I           I
prand total! 51.818           1.293      8.605          252      1.757                        17.956          271
     EEC
  COUNTRIES
                 THE    NETHERLANDS       UNITED KINGDOM               IRELAND                      DENMARK
   Tariff       Value in      Metric    Value in      Metric    Value xn           Metric    Value in       Metric
  headings       DH ■ 000       tons     DH ' 000       tons     DH • 000            tons     DH ' 000        tons
                                                                                ■l  '■    –
   61.01          2.248           70        146           5            0,3        • Nil              0,8      r-'ii
   61.02              214          5           17         0„4                       Nil              1        Nil
   61.03           Nil           Nil            1      Nil          Nil             Nil             21            0.3 .
   61 . 04         Nil           Nil            2      Nil          Nil       !     Nil         Nil          Nil
prand total       2,462           75        166                        1-r 1        Nil             22,8         0.3
 Total for 11 months ( 1975) : DH 82,787 -900                                Exports over 12 months : DH 90, 314 000
                                        1 945j7 metric tons                                                         2 /I22 metric tons
 ---pagebreak---                                                                          ANNEX II
                                      5
Draft Joint Committee Decision No        /7b derogating for 1976 and
1977 from the definition of the concept of'originating products "
 to take account of Morocco 's special situation in certain textile
 products
 THE JOINT COMMITTEE ,
Having regard to the Interim Agreement between the European Economic
Community and the Kingdom of Morocco , signed in Rabat on 22 April 1976 ,
and in particular Article 28 of the Protocol concerning the definition
of the concept of originating products and on methods of administrative
co-operation , which forms an integral part of that Agreement ;
Whereas in order to take account of Morocco 's special situation and
       to enable the industries concerned to adapt their production to
the conditions required by the definition of the concept of "originating
products", that State should be granted a derogation from the definition set
out in the said Protocol ;
HAS DECIDED s
Article 1
By way of derogation from the special provisions laid down in List A
annexed to the Protocol       on        the definition of the concept of
originating products and on methods of administrative co-operation, subject
to the following Articles , the provisions of that list concerning textile
products manufactured -in Morocco which fall within headings Nos 61.01 , 61.02 ,
61.03 or 61.04 of the Brussels Tariff Nomenclature shall be replaced by the
provisions in the Annex hereto .                                             .
Article 2                  ,
For 1976 and 1977 this derogation involves the following amounts :
- for 1976 > 1 250 metric tons
- for 1977 t 1 250 metric tons
 ---pagebreak--- Article 3
The movement certificates EUR . 1 issued under this Decision shall
bear one of the following endorsements :
- "textile derogation "
- "dérogation textiles "
-  " Abweichung für Spinnstoffe "
-  "deroga tessili "
-  "afwijking voor textielprodukten "
-  "Undtagelsesbestemmelser for tekstilstof "
The endorsement shall be made in Section No 7 " Remarks ".
Article
The Moroccan customs authorities shall communicate every three months
to the Commission the quantities of the products for which the certi­
ficates mentioned in Article 3 have been issued . The Commission shall
communicate this information to the Member States .
Article 5
The Contracting Parties shall , as far as each is concerned , take the necessary
measures for carrying out this Decision .
Article 6
This Decision shall apply on a prorata basis as regards the quantities
until 30 June 1977 »
Done at Brussels .                        For the Joint Committee
                                          The Chairman
 ---pagebreak---                                        - 7 -
                                                                      ANNEX
       Products obtained
                                Working or processing     Working or processing
                                that   does not confer
                                                         which confer the statue
Customs                              the status of       of' originating products
Tariff      ' Description      'briginating   product       when the following ,
heading                                                     conditions are met
                                                       I
 61.01     Men 's and boys *                               Manufacture from yarn
           outer garments                                  or  unbleached textile
                                                           fabrics
 61.02     Women 's , girls'                               Manufacture from yarn
           and infants'                                    or unbleached textile
           outer garments                                  fabrics
 61.03     Men 's and boys'                                Manufacture from yarn
           under garments ,                                or  unbleached textile
           including collars ,                             fabrics
           shirt fronts and
           cuffs
 61 . 0**  Women 'B , girls'                               Manufacture from yarn
           and infants'                                  . or unbleached textile
           under garments '                                fabrics
 ---pagebreak---                                                                    ANNEX III
                                  - 8 -
Proposition for a Council Régulation ( EEC ) No          /76 of            1976
 derogating for 1976 and 1977 from the provisions concerning the concept
 of "originating products" contained in the Agreement on co-operation and
 the interim Agreement between the European Economic Community and the
Kingdom of Morocco .
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community
and in particular Article 113 thereof ,
Having regard to the proposal from the Commission ,
Whereas an Agreement on co-operation and an interim Agreement between
the European Economic Community and the Kingdom of Morocco were signed
in Rabat on 22 April . 1976 ,
Whereas in order. to take account of Morocco 's special situation and
       to enable the industries concerned to . adapt their production to
the conditions required by the Protocol          on       the definition of the
concept of originating products annexed to those Agreements , it is
necessary' to provide for                     that State a derogation from the
provisions concerning the definition set out in the said Protocol ,
HAS ADOPTED THIS REGULATION :
Article 1
By way of derogation from the Protocol on      the definition of the concept
of originating products annexed to the Agreement on co-operation and
the interim Agreement between the European Economic Community and the
Kingdom of Morocco , subject to the following Articles , the provisions of List A
annexed to the Protocot on the definition of the concept of "originating products
and on methods of administrative co-operation , forming an integral part of these
Agreements , concerning textile products manufactured in Morocco which fall "within
headings Nos 61.01 , 61.02 , 61.03 or 61.04 of the Brussels Tariff Nomenclature,
shall be replaced by the provisions in the Annex hereto .
Article 2
For                      1976 and 1977 this derogation concerns an amount
fixed as follows :
- for 1976 f 1 250 metric tons
- for 1977 S 1 250 metric tons
 ---pagebreak--- Article 3      t        . ;
The movement certificates EUR.1 issued under this Regulation shall bear
one of the following endorsements :                          ^
- " textile derogation "
-  "dérogation textiles "
-  " Abweichung für Spinnstoffe "                                    .
-  "deroga tessili "
-  "afwijking voor textielprodukten "
-  "Undtagelsesbestemmelser for tekstilstof "
The endorsement shall be made in Section No 7 " Remarks ".
Article H
The Moroccan customs authorities shall communicate every three months
to the Commission the quantities of the products for which the certi­
ficates mentioned in Article J have been issued . The Commission shall
communicate this information to the Member States *
Article 5
This Regulation shall enter into force on 1 July 1976 *
                                                           »
It shall apply on a prorata basis as regards the quantities until -
30 Juné 1977.
This Regulation shall be binding in its entirety and directly applicable
in all Menber States *
                     *
                  «
Done at Brussels .                         For the Council
                                           The President
                                              •      . . .
 ---pagebreak---                                              10 -
            ■ ■            >.
                                                                          AKKVX
*
                  »•   •»       ■>
                                                           ,                          I
      Products obtained                                       Working or processing
                                    Working or processing rfhich confer s the status
                                    that   does not confer
 Customs
                                         the status of       of " originating products
 Tariff         Description        "originating products" v/hen the following
                                                                conditions are met
 heading
                                                           I
  61.01     Men 's and boys'                                  Manufacture from yarn
            outer garments                                    or unbleached textile
                                                              fabrics
  61.02     Women 's , girls'                                 Manufacture from yarn
            and infants'                                      or unbleached textile
            outer garments                                    fabrics
  61.03     Men 's and boys'                                  Manufacture from yarn
            under garments ,                                  or unbleached textile
            including collars ,                               fabrics
            shirt fronts and
            cuffs
  61.04     Women 's , girls'                                 Manufacture from yarn
            and infants'                                      or unbleached textile
            under garments                                 | fabrics                  J
                             ♦
    0
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