CELEX: 51977PC0313
Language: en
Date: 1977-07-11
Title: Proposal for a COUNCIL DIRECTIVE on the harmonization of provisions laid down by law, regulation or administrative action in respect of standard exchange of goods exported for repair (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (77) 313
Vol. 1977/0104
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                                                        COM(77)313 final
                                                        Brussels ,- Vi July 1977
                                         Proposal for s
                                        COUNCIL DIRECTIVE
              on the harmonization of provisions laid down by law ,
              regulation or administrative action in respect of
              standard exchange of goods exported for repair
                        ( submitted to the Council by the Commission )
 C0MC77 ) 313 final
 ---pagebreak---                                 EXPLANATION
1 . At the time when th© Counoil adopted Directive T6/ 11S/eS0 on the harmonisation
    of provisions laid down "by law , regulation or administrative action in respect
    of outward processing , the German delegation had the following statement
    written into the Council 's official minutes :
          '•The German delegation starts from the principle that the
           Commission  will , as soon as possible , submit to the Council
           a proposal  aimed at harmonising provisions laid down by law ,
           regulation  or administrative action for repair work carried
           out within  the framework of outward processing arrangements
           insofar as  these provisions concern simplifications with
           respect to  both the granting and implementation of the system
           of equivalent compensation (" Standard exchange")."
    This statement was occasioned by the fact that the benefit of outward
    processing arrangements may only be granted when it is possible for the
    competent authorities to identify, in the compensating products , the goods
    which were exported ( Article 4 » paragraph 3 )» and also by the fact that in
    the case of goods exported for repair it is economically justifiable to
    allow recourse to the principle known as " equivalent compensation".
2 . Thus the present proposal for a directive on the customs arrangements for
    standard exchange provides for the importation , with total or partial relief
    from import duties , of replacement products taking the place of goods ex­
    ported outside the Community 's customs territory for repair , including being
    restored to their original condition and being put in working order , However ,
    the benefit of these arrangements cannot be granted when the exported goods
    are not in one of the situations provided for in Article 9 paragraph 2 of
    the Treaty , nor to goods subject to the common agricultural policy or to the
    specific arrangements applicable , pursuant to Article 235 of the Treaty , to
    certain goods resulting from the processing of agricultural products .
    The replacement products and the exported products must full under the same
    tariff sub-heading , be of the same commercial quality and possess the same
    technical characteristics . Moreover , if the exported goods have been used
    before exportation , the replacement products must also have been used , save
    where the circumstances justify a derogation from this rule ( Article 4 )»
3 . The arrangements for standard exchange are subject to rules identical to
    those laid down by Council Directive 76/119/EEC , except for certain special
    provisions set out in the present proposal for a directive . Apart from
    Article 4 , mentioned above , the most important provisions are the following :
    Article 3 :
    This article provides that the competent authorities may allow the replacement
    products to be imported before the goods to be repaired are exported ; this
    prior importation requires the provision of a guarantee covering the import
    duties , to be discharged at the time when the goods for repair are exported .
    Article 5 :-
     This Article stipulates that the claimant must lodge his request for
     authorisation before the exportation of the goods or the prior importation
     of the replacement products ; however , if the goods have been exported under
     an authorisation f6r outward processing , the benefit of standard exchange
     may be requested at any time up to the moment when the replacement products
     are imported .
                                                                         /
 ---pagebreak---      Article 5 further provides , in paragraph 3 , that the benefit of standard
     exchange shall he refused by the competent authorities when recourse to
     such arrangements would have the effect of conferring an unjustified
     advantage as regards relief from import duties . This provision will enable
     the competent authorities to withhold the benefit of these arrangements
     in any case where differential taxation is not sufficient to ensure the
     desired tariff protection . At the time when the proposal was being drawn
     up discussions with delegations from the Member States demonstrated the
     difficulty of laying down with any greater precision the circumstances
     which may justify the benefit of such arrangements being withheld .
     The following example should illustrate the usefulness of this provision :
    Example :   The claimant seeks permission to export his old
                American car and to import , with the benefit of
                standard exchange , a more recent car of the same
                make .
     In a case such as this , where the transaction could he described as a
     "purchase with part-exchange ", Article 5 paragraph 3 is essential to
     enable the authorities to withhold these arrangements .
     The Commission intends to proceed to an examination of Member States'
     experiences in respect of the practical implementation of this provision
     once the directive has been in force for a few months .
    Article 6
     In this article the time limits for the completion of the various standard
     exchange operations are set out . It should be noted that the normal time-
     limit (6 months with the possibility of renewal for a further 6 months )
     corresponds to the time-limit provided for by the proposal for a Council
     regulation (EEC ) in respect of the repayment or remission of import duties
     or export duties ( l ) which is still being considered within the Council .
    Article 7
     The chief objective of this article is to rule out the possibility of
     replacement products being imported into a Member State other than the one
     from which they were exported . This provision is occasioned by a concern to
     increase the opportunities for control and thus to minimise the risk of
     fraud . If experience should show that the triangular system meets a genuine
     need , and provided always that control measures can eliminate the risk of
     fraud , the Commission will be able to adopt provisions allowing replacement
     products to be imported into a Member State other than that from which they
     were exported .
     Article 8
     As a general rule , differential taxation is applied according to the provis±>ns
     of the directive on outward processing . Only in the case of prior importation
     are special provisions required , because the value and quantity of the goods
     to be exported only become known at the time of exportation . The following
     solution is proposed : for the replacement products (= the imported products )
     the factors vdiich must be taken into account for the calculation of the im­
     port duties on these products are determined at the   date of importation ;
     for the goods that are exported this date cannot be   taken as the reference
     point , because these products are only presented to  the customs authorities
     at the date of exportation , and therefore after the  prior importation ; for
                                                                               ./•
( l ) OJ No . C 54 of 8.3.1976 , p. 85
 ---pagebreak---                            - 3 -
this reason it is proposed to determine the amount of import duties which would
be applicable to the goods exported if they were to be imported into the
Community from the country from which the replacement products originate on
the date when these goods are presented to the competent authorities .
Articles 9 and 10
The arrangements for standard exchange and those for inward and outward
processing are complementary to a great extent , and the Committee for
Customs Processing Arrangements is responsible for considering any matters
that may arise in respect of the implementation of the present Directive .
 ---pagebreak---                                  Proposal for a
                                COUNCIL DIRECTIVE
               on the harmonization of provisions Laid down by
                law, regulation or administrative action in
                respect of standard exchange of goods exported
                                 : for repair
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
and in particular Article 100 thereof ;
Having regard to the proposal from the Commission ,
                                                            (1)
Having regard to the opinion of the European Parliament         ,
                                                                       (2)
Having regard to the opinion of the Economic and Social Committee          ,
Whereas the Council adopted , on 18 December 1975 , Directive 76/ 119/ EEC on
the harmonization of provisions laid down by law , regulation and adminis­
trative action in respect of outward processing        ;   whereas the benefit of
these arrangements may be granted only where it is possible for the competent
 authorities to identify the exported goods as having been incorporated in
the compensating products ;
Whereas it is economically justifiable to allow , in certain limited cases ,
 recourse to standard exchange , that is to say the importation with total or
partial relief from import duties of replacement products which take the
place of goods exported for the purposes of being processed , worked or
 repaired ;   whereas this is "the case , in particular , when the goods have "been
 exported for repair , including restoration and overhaul ; whereas , however ,
 recourse to standard exchange should not Toe allowed unless the goods exported
 are within the terms of Article 9(2 ) of the Treaty ; whereas , "by their very #
 nature , agricultural products or goods resulting from the processing of
 agricultural products are hardly suitable for repair ; whereas , furthermore ,
                                                                             ./.
 ( 1 ) 0J No
 ( 2 ) 0J No
 ( 3 ) 0J No L 24 , 30.1.1976 , p. 58 .
 ---pagebreak---                                       - 2 -
standard exchange such as it should be organised , is not compatible with
the machinery of the common agricultural policy or with the specific arrangements
applicable , pursuant to Article 235 of "the Treaty, to goods resulting from the
the processing of agricultural products ; whereas the products and goods subject
to that machinery or "to those arrangements should therefore be excluded from the
scope of these provisions ;
Whereas common rules must be Laid down in the Member States in respect of
standard exchange ; whereas these arrangements resemble in their aims and
detailed provisions those for outward processing , and whereas they should in
these circumstances be subject to the same rules as those provided for by
Directive 76/ 119/ EEC , except where the present Directive lays down special
provisions ; whereas these special provisions concern in particular the
scope of the arrangements and the right to import replacement products
( equivalent compensation ), including the right to do so before the goods to
be repaired are exported ; whereas under standard exchange , in order to facilitate
control , recourse may not be had to the triangular system , unless provisions
allowing recourse thereto are adopted in accordance with the Committee
                                                                       (1 )
procedure set out in Article 28(2 ) and ( 3 ) of Directive 69/ 73/ EEC      ;
Whereas , in order to ensure the uniform application of such common rules ,
provision should be made for a Community procedure whereby the appropriate
 implementing provisions may be adopted within a suitable period of time ,
 HAS ADOPTED THIS DIRECTIVE :
 ( 1 ) OJ No L 58 , 8.3.1969 , p. 1 .
 ---pagebreak---                                      Article 1
This Directive determines the rules which must be incorporated in the
provisions laid down by law, regulation or administrative action in
Member States in respect of arrangements for standard exchange of goods
exported for repair , hereinafter called " standard exchange ".
                                     Arti ele 2
1 . Standard exchange means the customs arrangements whereby replacement
     products replacing goods of whatever kind and whatever origin exported
     outside the customs territory of the Community for repair , which includes
      restoration and overhaul ,- may "be imported wholly or partly free of import duties j
      such goods are hereinafter referred to as " exported goods ".
2 . Standard exchange shall be subject to rules identical to those provided
      for by Council Directive 76/ 119/ EEC , with the exception of such special
     provisions as are provided for in the present Directive .
3 . Standard exchange arrangements may not apply to goods which have entered
     the Community under inward processing arrangements , nor to goods falling
      under the common agricultural policy or the specific arrangements appli­
      cable , pursuant to Article 235 of the Treaty , to certain goods resulting
      from the processing of agricultural products .
                                     Article 3
1 . Where circumstances so warrant , replacement products may , under conditions
      laid down by the competent authorities , be imported before the exportation
      of the exported goods . Such prior importation shall be treated in the
      same way as importation in accordance with Article 2(1 ).
2 . The prior importation of a replacement product shall require the provision
      of a guarantee covering the amount of the import duties ; the guarantee
      shall be discharged on payment of the import duties due pursuant to
      Article 8 .
    ν
 ---pagebreak---                                       - 4 -
                                     Article 4
1 . Replacement products must fall within the same Tariff subheading and must
     possess the same commercial quality and technical characteristics
     as the exported goods are to have following the repair in question .
2 . Where the exported goods have been used before exportation ,, the replacement
     products must also have been used and may not be new products .
     The competent authorities may , however , grant derogations from this rule ,
     if the replacement products have been supplied free of charge under a
     guarantee imposed by contract or by statute T on the condition that the
     importation of the replacement product takes place witfiin 12 months after
     the date when the exported goods were first entered for home use .
                                     Article 5
 1 . The competent authorities of the Member State of exportation shall grant
     the benefit of standard exchange upon app I i cation, by general or special
      authorization and before the exportation of the goods or the prior
      importation of the replacement products .
 2 . The competent authorities may grant the benefit of standard exchange upon
      application submitted not later than the time of importation of the
      replacement products , if the goods were exported under an outward
     processing authorization .
 3 . The competent authorities shall withhold the benefit of standard exchange
      where it would give rise to an unjustified advantage as regards exemption
      from import duties .
                                     Article 6
 1 . The period within which the importation of replacement products must
      take place shall not exceed six months. However , this period may be
      extended by the competent authorities on submission by the holder of
 ---pagebreak---                                     - 5 -
     the authorization of a duly justified request , provided that the total
     period shall not exceed 12 months . This period shall be calculated from
     the date of acceptance by the competent authorities of the export documents
     for the exported goods .
2 . In the case of prior importation , the period within which the exportation
     of the exported goods must be carried out shall not exceed one month .
     However , this period may be extended by the competent authorities on
     submission by the holder of the authorization of a duly justified request ,
     provided that the total period shall not exceed two months . This period
     shall be calculated from the date of acceptance by the competent authorities
     of the documents relating to the importation of the replacement products .
                                    Article 7
1 . Hie importation of replacement products may "be carried out only by the
     holder of the authorisation or on his "behalf .
2 . Replacement products must be imported into the Member State from which
     the exported goods have been or are to be exported .
3 . The competent authorities may prescribe in the authorization that the
     export and import transactions must be carried out at the same customs
     office .
4 . However , provisions permitting replacement products to be imported into
     a Member State other than that of exportation may be adopted in accordance
     with the procedure laid down in Article 10 .
                                    Arti ele 8
 1 . The total or partial exemption from import duties provided for in
     Article 2 shall be granted in accordance with the rules laid down by
     Articles 10 and 11 of Directive 76/ 119/ EEC , the replacement products
     being treated in the same way as the re-imported products referred to
      in the said Articles .
 ---pagebreak---                                     - 6 -
2 . However , where the replacement products are the subject of prior irrportation ,
     the amount of the import duties which would be applicable to the goods if
     they were imported into the Community from the country from which the
     replacement products come shall be determined by reference to the rate
     or the amount applicable on the date of acceptance by the competent
     authorities of the export document for the goods in question ; this date
     shall also be taken to determine the quantity , nature and value of the
     said goods .
                                    Arti ele 9
The Committee for Customs Processing Arrangements , set up by Article 26 of
Directive 69/ 73/ EEC , may examine any matter relating to the application of
this Directive which is brought up by its Chairman either on his own initiative
or at the request of the representative of a Member State .
                                    Article 10
The necessary provisions for inplementing Article 3 and Articles 5 to 7
shall be adopted according to the procedure laid down in Article 28C2 ) and
( 3 ) of Directive 69/ 73/ EEC .
                                     Article 11
Member States shall bring into force the laws , regulations or administrative
provisions needed in order to comply with this Directive within six months
of .its notification .
Member States shall communicate to the Commission the provisions which they
 adopt in order to implement this Directive .    The Commission shall inform the
 other Member States thereof .
                                     Artrcle 12
 This Directive is addressed to the Member States .
 Done at Brussels ,                             For the Counci l
 ---pagebreak---                         FIlU-Jv fTT AL M^ORMÏDUM
      Draft propoesul for a Counoil Directive on the harmonisation of provisions
laid down, "by law , regulation or administrative teetion in respect of standard
csoii&wg® of goods exported for repair .
      !Rie proposed direotiv© referred to above will entail a reduotion of
inoou© in the fona of iiaport duties .
      It is not possible to put a figure on thia reduotion , but it will ,
without doubt , "b© very slight .