CELEX: 51976PC0326
Language: en
Date: 1976-06-23
Title: Draft ACP-EEC Council of Ministers Decision derogating from the concept of originating products in order to take into account the special situation of Mauritius with regard to certain products of the textile industry (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (76) 326
Vol. 1976/0097
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 ---pagebreak---     COMMISSION OF THE EUROPEAN COMMUNITIES
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      i.
                /                         "
                                ■     -            COM ( 76 ) 326 final .
                             '                     Brussels , 23 June 1976 .
              Draft ACP-EEC Council of Ministers Decision derogating
                                                           ■
              from the concept of originating products in order to        I
              take into account the special situation of Mauritius
              with regard to certain products of the textile industry
                                                             ■
                   ( submitted to the Council toy .the Commission)
Λ '
                            ■Λ
                                   ..   /
                                   •/
    COM(76) 326 final .
 ---pagebreak---                   Explanatory Memorandum
I. Submission of the request
        By letters of 19 September 1975 and 2 April 1976 the
Government of Mauritius forwarded to the Commission through its
Charg£ d 'Affaires in Brussels , a request for derogation from the
definition of the concept of originating products in respect of an
annual quantity of 3 000 000 m of unbleached fabrics over a period
of two years .
        These 6 000 000 m represent 1 664 t and according to the
letter of 2 April 1975 they would be broken down as follows t
United Kingdom               : 2  020 000 m ( 575 t)
Federal Republic of Germany : 1   040 000 m (254  t)
Prance                        : 1 100 000 m ( 524 t)
Belgium                       : 1 840 000 m ( 311 t ).
        Mauritius wants to create an integrated textile chain from
spinning to the finished product via the weaving, bleaching , dyeing
and printing stages . Unfortunately Mauritius does not have sufficient
capital to construct all the necessary plants at the same time and ,
if it began with the spinning unit , would have no immediate way of
using the yarn produced. It was decided , therefore , to begin by
building a weaving unit which would use imported yarn , mainly from
Pakistan , in order to produce unbleached fabrics intended primarily
for export to the Community countries .
        Then the bleaching, dyeing and printing unit as well as
the spinning works would be constructed some two years after the
weaving unit Btarted operating. Mauritius would thus have an inte­
grated textile complex and the finished products would be fully
entitled to originating status , whereas , as in the first stage
planned - fabrics manufactured from non-originating yarn - they do
not meet the conditions for acquiring this status , namely manufacture
from raw cotton , cotton waste or carded cotton.
                                                                     ./•
 ---pagebreak---         F rty-five per cent of tho capital is Mauritian , 55/® Pakistani ,
the yc-~n would come from Padistan and India , the industial equipment
was bought in Belgium and Germany and saleB contracts have already
been signed with French , Belgian , German and British firms .
According to recent information , production tests axe under way .
        The Government of Mauritius has stressed tbo vital role of
this textile complex and considers a temporary derogation from the
rules of origin essential ; moreover , this request was the subject of
an agreement among the ACP States . It is based on the provisions of
Article 27 of Protocol No 1 to the Lome Convention and on paragraphs
4 and 5     Annex IX to Protocol No 1 .
        Since this request was presented by all the ACP States during
a meeting of the Customs Cooperation Sub-Committee on 16 February 1976 »
the maximum period of six months stipulated in Article 27 of Protoool
No 1 will expire in mid-August . As a decision must be reached by
that date , it would be advisable for this matter to be examined at
a meeting of the ACP-EEC Council of Ministers whioh oould be held in
July .
II . The Commission' s opinion
        The arguments put forward by Mauritius comply with the
criteria laid down in the Convention . The request relates to the
creation of a new industry (Article 27 of Protocol No l ) and the
produots to be used originate in developing countries ( India, Pakistan)
with which Mauritius has a special relationship (Annex IX ( 3 ))*
        From the economic point of view it is pointed out by the
relevant Commission departments that the Mauritian request concerns
an extremely sensitive industrial sector. At present the Community
textile industry is facing real difficulties connected to a large
extent with the imports of cotton fabrics from developing countries ,
and to import any additional quantities could aggravate an already
delicate situation .
 ---pagebreak---         •>. fc should be noted , however , that the quantities in question
( 1664 t ) are fairly modest in relation to the Community 's total
imports of cotton fabrics , which amounted to 168 761 t in 1974 .
        Moreover , zero duty tariff quotas were opened for certain
developing countries under the generalized systmn of preferences ,
amounting to 8802 t in 1976 , and additional imports may still be
effected under the same conditions within the Community ceiling.
The textile agreements provide for quotas of about 127 000 t
( although without any tariff concessions ). The question may be
asked , therefore , whether the I664 t which are the subject of the
request for derogation are likely seriously to disturb the balance
of the textile sector and since , as the Mauritian authorities have
assured the Community , the fabrics produced from 1978 on will have
originating status and may therefore be imported freely , postponing
access to the EEC market by two years risks being more politically
disadvantageous than economically effective .
        It may also be pointed out that it is a question here of
unbleached cotton fabrics , to be prooessed in the Community by
textile firms and that this will have beneficial effects for these
fizms .
        Since this first - and only - request for derogation complies
with the criteria laid down in Protocol No 1 to the Lome Convention
and in Annex IX to that Protocol and since it does not seem to
constitute a serious threat for the Community because of the modest
quantities involved , the Commission proposes to meet the Mauritian
request and to accord the derogation . In order to disturb traditional
trade flowB as little as possible , however , this derogation should
in any case not exceed a period of two years , regardless of the
state of integration reached at the end of that period by the textile
complex being set up and whatever the quantities delivered.
        The Commission therefore proposes the following draft decisioni
                                                                           ./■
 ---pagebreak---                             - 4 -
Draft ACT -EEC Council of Ministers Decision No
derogating from the concept of originating products in order to
take into account the special situation of Mauritius with regard
to certain products of the textile industry .
THE ACP-EEC COUNCIL OP MINISTERS ,
Having regard to the Lome Convention signed on 28 February 1975
between the European Economic Community and the African , Caribbean
and Pacifio States ,
Having regard to the proposal from the Commission ,
Having regard to the report of the Customs Cooperation Committee ,
Whereas Article 27 of Protocol No 1 to the LomS Convention concerning
the definition of the concept of 'originating products' and methods
of administrative cooperation provides for derogations from the said
rules of origin , notably to facilitate the development of existing
industries or the oreation of new industries ;
Whereas the Government of Mauritius has submitted a request for a two-
year derogation from the definition set out in Protocol No 1 to the
Lom6 Convention for textile products manufactured in that State ;
Whereas in order to take into account the special situation of Mauritius
and to enable the industrial sectors conoerned to set up new industrial
plants which necessitate derogations from the said Protocol , provision
should be made for a two-year derogation from the definition set out
in the Protocol referred to above ,
HAS DECIDED AS FOLLOWS :
                            Article 1
By way of derogation from the special provisions of List A in Annex II
to Protocol No 1 to the Lom£ Convention concerning the definition of
'originating products' and methods of administrative cooperation ,
textile products manufactured in Mauritius and falling within tariff
heading No ex 55»09 "unbleached woven fabrics of cotton", shall be
considered as originating in Mauritius under the conditions set out
below.                                                              •/•
 ---pagebreak---                            Artici ? 2
This derogation concerns the following quantities :
- from 1 July 1976 to 30 June 1977s
  ex 55«09s unbleached woven fabrics of cotton : 832 metric tons
- from 1 July 1977 to 30 June 1978 :
  55.09 : unbleached woven fabrics of cotton : 832 metrio tons
                           Article 3
The movement certificates EUR 1 issued pursuant to this Decision
shall be endorsed with one of the following phrases :
- "marchandises réputées originaires en vertu de la décision n*          /
  du Conseil des Ministres ACP-CEE "
- "Ursprungserzeugnisse im Sinne gemäss Beschluss Nr.         /76 des
  Hinisterrates AKP/EWG"
  "merci originarie in virtù della decisione n .       / 7ó del
  Consiglio dei Ministri ACP-CEE "
- "goederen van oorsprong uit hoofde van Besluit Nr.            / 76 van
  de ACS-EEG Raa'. van Ministers "
- "originating products by virtue of ACP-EEC Council of Ministers
  Decision No       H6 "
- "varer med oprindelsesstatus i henhold til Den beslutning nr .
           /l6 af Ministerrådet ASV-EØF"
       This endorsement shall be entered under the heading 'Remarks' .
                           Article 4
The competent authorities of Mauritius shall forward to the Commission
every three months a statement of the quantities in respect of which
movement certificates EUR 1 have been issued pursuant to this
Decision , indicating the Member States of destination.
                           Article 5
The ACP States , the Member States and the Community shall , each one
for its part , take the measures required for implementation of thiB
Decision .
 ---pagebreak---                          Article 6
This Decision shall enter into force on 1 July 1976 .
It shall be applicable , on a pro rata basis as regards the
quantities , until 30 June 1978 .
Done at                              For the ACP-EEC Counoil of Ministers
                                     The President