CELEX: 51998PC0399
Language: en
Date: 1998-06-30
Title: Proposal for a Council Regulation (EC) concerning the tariff treatment applicable upon importation of certain types of food supplements originating in Switzerland

COMMISSION OF THE EUROPEAN COMMUNITIES
                                          Brussels, 30.06.1998
                                          COM(1998) 399 final
                                          98/0224 (ACC)
                           Proposal for a
                  COUNCIL REGULATION (EC)
               concerning the tariff treatment
               applicable upon importation of
certain types of food supplements originating in Switzerland
                  (presented by the Commission)
 ---pagebreak---  ---pagebreak---                              Explanatory Memorandum
 1.  The Swiss authorities have repeatedly raised the question of the duty applied
     to certain types of food supplements intended to maintain general health or
     well-being, and in particular to the preparations called Swiss Caps (essentially
     dried garlic in capsule form, intended to contribute to the health of the user).
2.   The Swiss authorities have indicated that in the past some imports of these
    products have been allowed at a zero rate of duty, as they have been classified
     as pharmaceutical products. The Community, however, is of the view that
     these products are to be classified as food preparations under CN code 2106 90
     92 and are therefore subject to a duty of 16.4%. The Swiss side agrees to this
     classification, but requests that a zero duty be applied.
3.    The Commission is prepared to comply with this request, as the Swiss side
     agrees to apply the same definition and zero duty rate to its imports from the
     Community.
4.    The Commission therefore proposes to reduce to zero the rate of duty applied
     to certain nutritional complements of Swiss origin, defined as:
    "Food supplements based on plant extracts, fruit concentrates or honey, with
    added vitamins and, sometimes, very small quantities of iron compounds,
    often put up in packaging indicating that they are intended to maintain general
    health, containing no milk fats, sucrose, isoglucose, glucose or starch or
    containing, by weight, less than 1.5% milk fat, 5% sucrose or isoglucose, 5%
    glucose or starch."
5.  This autonomous measure is conditional on the adoption of an entirely
    equivalent measure by Switzerland, e.g. zero duly rate, definition of the
    product and date of introduction. It will be re-examined if Protocol 2 of the
    EC-Switzerland Free Trade Agreement is adapted.
6.  In order to ensure the proper application of the decision a new Taric
    subheading will be created which will enable the Community to limit its
    application to the products concerned.
7.  The Commission will monitor market developments for this product and, if
    disruptions occur or imports increase significantly, may suspend the present
    measure.
8.  For these reasons, the Commission recommends that the Council adopt the
    attached proposal for a Council Regulation.
                                         I
 ---pagebreak---       Proposai for a Council Regulation (EC) concerning the tariff treatment
          applicable upon importation of certain types of food supplements
                               originating in Switzerland
THE COUNCIL OF THE EUROPEAN UNION
Having regard to the Treaty establishing the European Community, and in particular
Article ! 13 thereof,
Having regard to the proposal from the Commission,
Whereas, in the European Community, certain types of food supplements intended to
maintain general health or well-being are classified under CN code 2106 90 92 as
food preparations and are subject to a duty of 16.4%;
Whereas it seems appropriate for the European Community to grant a zero duty rate
on imports of these products from Switzerland;
Whereas CN Code 2106 90 92 includes goods not covered by the present Regulation,
so that a specific description of the products concerned is needed;
Whereas this measure will be re-examined if Protocol 2 of the Free Trade Agreement
between the EC and Switzerland is amended.
HAS ADOPTED THIS RECULA LION:
                                        Article 1
The following Ibod preparations originating in Switzerland and classifiable under
CN code ex 2106 90 92 shall be subject to zero duly upon importation into the
Community:
"Food supplements based on plant extracts, fruit concentrates or honey, with added
vitamins and, sometimes, very small quantities of iron compounds, often put up in
packaging indicating that they are intended to maintain general health, containing no
milk fats, sucrose, isoglucose, glucose, or starch or containing, by weight, less than
1.5% milk fat, 5% sucrose or isoglucose, 5% glucose or starch."
                                        Article 2
A new Taric subheading will be created which will enable the Community to limit the
application of this Regulation to the products concerned.
                                           3
 ---pagebreak---                                         Article 3
The Commission will monitor trade developments for the products concerned and
may suspend Ihe présent measure if any disruption occurs or imports increase
significantly, according to the procedure laid down in Article 16 of Regulation (EC)
No 3448/93.
                                        Article 4
This Regulation shall enter into force on the third day following its publication in the
Official Journal of the European Communities. It shall apply from
This Regulation shall be binding in its entirety and directly applicable in all Member
States.
Done at Brussels,                                     For the Council
                                                       The President
                                            H
 ---pagebreak---                               FINANCIAL STATEMENT
 1.     TITLE OF OPERATION
Proposal fora Council Regulation (EC) concerning the tariff treatment applicable
upon importation of certain types of food supplements originating in Switzerland.
2.      BUDGET HEADING INVOLVED
Chapter 12, Article 120
3.      LEGAL BASIS
Article 113 of the Treaty establishing the European Community.
4.      DESCRIPTION OF OPERATION
a.     The Swiss authorities have repeatedly raised the question of the duty applying
       to certain types of food supplements intended to maintain general health or
       well-being, and in particular to the preparations called Swiss Caps.
b.     The Swiss authorities have indicated that in the past some imports of these
       products have been allowed at a zero rate of duty, as they have been classified
       as pharmaceutical products. The Community, however, is of the view that the
       products are to be classified as food preparations under CN code 2106 90 92
       and are therefore subject to a duty of 16.4%. The Swiss side agrees to this
       classification, but requests that a zero duty be applied.
c.     The Commission is prepared to comply with this request. Movement on this
       dossier will demonstrate good will on the part of the Union in seeking a
       solution to other long-standing bilateral problems.
 d.    The Commission therefore proposes to reduce to zero the rate of duty applied
       to certain nutritional complements of Swiss origin, defined as:
       "food supplements based on plant extracts, fruit concentrates or honey, with
       added vitamins and, sometimes, very small quantities of iron compounds,
       often put up in packaging indicating that they are intended to maintain general
       health, containing no milk fats, sucrose, isoglucose, glucose or starch or
       containing, by weight, less than 1.5% milk fat, 5% sucrose or isoglucose, 5%
       glucose or starch."
       This proposal is conditional on the application by Switzerland of the same
       measure, the zero duty rate and the definition of the product.
                                              <
 ---pagebreak--- e.     This change will be implemented on an autonomous basis and must be
       considered a transitional measure. It will definitely be considered within the
       lulu i c adaptation of Protocol 2 of I IK- EC-Swilzerland free Trade Agreement.
I.     In order to ensure the proper application o\' the decision a new Tarie
       subheading will be created which will enable the Community to limit its
       application to the products concerned.
g.     The Commission will monitor market developments for the product concerned
       and, if disruptions occur or imports increase significantly, may suspend the
       present measure.
5       CLASSIFICATION OF EXPENDITURE OR REVENUE
5.1    Compulsory / Non-compulsory expenditure
        Loss of revenue
5.2    Differentiated / Non-differentiated appropriations
       N/A
5.3    Type of revenue involved
       Customs duties
6.     TYPE OF EXPENDITURE OR REVENUE
       Loss of revenue due to change in customs rating from 16.4 % to zero rating.
7.     FINANCIAL IMPACT
The calculation oflhc loss of revenue due to the change in customs rating is based on
figures provided by Switzerland, according to which the annual value of the
Community's imports of the goods in question is CI IF 10 to 15 million. The current
customs rating is 16.4%. Therefore the maximum loss of revenue will be
ECU 1.5 million a year ((CHF 15 million / 1.63316) x 16.4% = ECU 1.5 million).
                                          £
 ---pagebreak---                                                                   ISSN 0254-1475
                                                            COM(98) 399 final
                                              DOCUMENTS
EN                                                                02 03 11
                                    Catalogue number : CB-CO-98-410-EN-C
                                                             ISBN 92-78-37437-7
Office for Official Publications of the European Communities
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