CELEX: 51976PC0505
Language: en
Date: 1976-10-08
Title: Proposal for a COUNCIL REGULATION establishing a european agency for trade cooperation with the developing countries (submitted to the Council by the Commission) )

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (76) 505
Vol. 1976/0152
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                        COM(76)505 final.
                                                         I
                                        Brussels , 8 October 1976 .
                             Proposal for a
                           COUNCIL REGULATION
 establishing a european agency for trade cooperation with the developing
                                 countries                      x
              ( submitted to the Council by the Commission )
        )
 CCM(76 ) 505 final
 ---pagebreak---                                        EXPLANATORY MEMORANDUM
   I.    INTRODUCTION
         On 30 April 1974 "the Council adopted two resolutions , one on improving
         the Generalized System of Preferences ( GSP) and the other on financing ,
         by appropriations tq he entered in the Community Budget , specific tech­
         nical assistance schemes to promote the exports of non-associated
         developing countries ; trade promotion is also provided for in the Lome
         Convention .   •     I
         In the meantime in another resolution , adopted on 3 Maifch 1975 » "the
         Council has confirmed its will to make a sustained and j progressive
         effort to improve the generalized preferences , in particular by en­
         couraging the beneficiary developing, countries to make better use of the
         Community 's GSP by providing them with more informatiorl on it . It is in
         this context that the idea of creating an Agency has grown up : the task
         of the Agency would be , amongst other things , to help improve the uti­
         lization of the Community 's generalized preferences , pie idea received
         immediate support from the European Parliament (which/ dealt with this
         question at length in 1974 and 1975 ) 1 from the Economic and Social
         Committee ( in an Opinion da^ed 15 September 1975 ) » friom the national
         administrations of the Nine ( see Annex II: Report by jMr di MARTINO)
         and finally , of course , from the beneficiary countries .
' II .   NATURE OP THE NEW TASKS
       /     1 –
                 .
         In the field of generalized preferences , the national1 i administrations
      j would like to improve both the qualitative and the quantitative use of
         GSP by disseminating documentation , information and advice to the users ,
         with four aims in mind :
               to make its use easier for the developing countries which have
               to unravel the complexities of the Community 's scheme 5
                   i                         I
               to spread its use more evenly over the 'whole Community and
                increase utilization while adapting it to the structural and
                cyclical trends of* the economic sectors of the Community
               affected by the GSP ;                          /        f
            - to spread its use more evenly,/ ^mong tue various beneficiary
                countries *
                                                                         •/2
 ---pagebreak---        - to make its use more profitable for developing country exporters ,
          especially as regards the financial advantages .
                                                              \
Here are some figures that will give a better overall picture :
         YEAR                POSSIBILITIES OFFERED         UTILIZATION               %
                                     UKDER GSP
         1974                    3»250 m . u.c .                 2.100 m .u.c .      65
         1975                    3*600 m .u.c .                  2.450 m . u.c .     67
         1976                    4.6OO m.u.c .         2.700 - 3.000 m.u.c.(l ) 59 - 65
         1977                    6 . 470 m.u.c .       3.000 - 3.500 m.u.c . ( l ) 46 - 54 .
A more detailed analysis would reveal that the drop in the utilization rate
is concentrated essentially in the sector of non-sensitive products and that
the bulk of imports under the GSP is increasing steadily in the sectors of
sensitive and semi-sensitive products .
          /
    t!
The new t'&sks , which will essentially involve execution , will consist in
supporting the Community 's GSP by helping to promote an economic impact
mpre favourable to the developing countries and better adapted to the
Community economy. '
                          ,/         '
                                             <      \
                                                                     J
            '     }      ./'       j>'.n ]         J . |
As all the action envisaged i/s diredted primarily fart private enterprise ,
                                                                                 ,
the new tasks should be designed, carried out and 'administered in accor­
dance with the methods and standard^ used in the private/ sector/.                 f
                                                 1    ■/.    J
The tasks will involve the collection and processing of /a vast ' amount of
data . The wo^k will cover all agricultural and industrial products            >
 ( 2.429 tariff lines covered by the 1977 GSP scheme ). The information
collected wi/ll be available to all actual or potential users ^of the pre­
ferences in , the Community and in all the non-member countries concerned .
All the work concerned with distributing documentation , providing infor­
mation and advice will naturally call for methods suited to the specific
character of the Community-' s scheme of preferences and the complex i^ules
governing its operation .                                         '
Hence this action will be quite different from anything done m the way
of trade promotion to be described later .                                /
                                                                        I               ■ !
In the field of trade promotion , the implemention of the trade promotion                 ,
action programme for the ; 46 ACP States and increasingly for the other developing
( l ) estimate                                                              •/3
 ---pagebreak---                                                                               3 .-
      countries means a considerable increase in the workload all requiring
      the Commission 's staff to take action very quickly .
      The new and additional tasks to be carried out , because of the need ,
      for speed in them , of their operational and commercial nature , in direct
      and constant contact with the private sector , are more and more difficult
      to reconcile with the administrative and financial procedures which are
      the Community 's .  '
      It should be noted that many trade promotion schemes take place on dates
      set by independent bodies and these dates cannot be changed . It follows
      that the preparation of these schemes must be carried out within a strict
      time schedule , which is generally short , with the help of many people or
      companies established in the developing countries and in the Community and
      that , for this reason , it is difficult to use normal channels of commu­
      nication and administrative decision-making procedures to carry out this
      type of work .
      Experience has shown that the national administrations of the llomber States
      have come up against similar difficulties in trying to carry out promotion
      schemes for national products on foreign markets ; they have solved, the
      problem by setting up specialized bodies , with semi-public status , which
      are the instruments for carrying out the policy designed and decided upon
      in the Ministries for Foreign Affairs , Economy and Foreign Trade .
      The solutions which have been proven at the national level have largely
      inspired the thoughts below .
III . CREATION OF A COIMJjnTY AGENCY
      The operational requirements described above , although they diifer accor­
      ding to whether they concern the GSP or trade promotion , do run parallel
      to and   complement   each  other in many respects : they are undoubtedly
      the result of the broadening out of Community action in respect of the
      developing countries in the field of trade relations . They make it neces­
      sary for an appropriate body to be set up under the control and responsi­
       bility of the Commission , charged exclusively with carrying out everything
       related to the schemes , programmes and projects, mentioned above .
                                            It could be in the form of a " Community
      Agency" to cover both GSP and trade promotion . This Agency will be put
      under the responsibility and control of the Commission . For reasons of a
      practical nature it will have its headquarters in close proximity to th-i
      Commission and the developing countries' trade missions , or diplomatic
      missions as the case may be .
      The Agency , whose establishment is proposed , will be called on to work in
      the main with various parties in the private sectbr . Its working methods
      and its staff will therefore need to be adapted to this requirement . Hence
      the duties assigned to this Agency are by definition duties which officials
      of the Commission who are bound by Staff Regulations and by nature inclined
      to be cautious , will not be able to take on .                               /.
 ---pagebreak---                                                                                 4 .-
IV . DESCRIPTION AMD DISTRIBUTION OF TASKS
     The mission of "the Agency is to carry out duties intended to facilitate
     generally the achievement of the Community 's objectives in the field of
     trade relations with the developing countries through practical schemes
     in two distinct but complementary fields : use of the GSP and trade promotion .
     Because of this dual purpose , the Agency has two distinct departments , one for
     the GSP and the other for trade promotion schemes . The duties assigned to
     each of these two branches are described below :
     1 . The GSP Department will be responsible for three kinds of tasks ( see Annex i/A)
          a ) Providing documentation on the GSP
              - Setting up and operating three card index systems ( of importers ,
                exporters and other donor countries);
              - Summary of the influence of the GSP on the export trade and economies
                of the developing countries and on the European import trade based
                on these three indexes ( l ) ;
              - Factual summary   on a comparative and ongoing basis of imports under
                the GSP into various donor countries .
          b ) Providing information
              - Annual publication - in the official languages of the Community , in Spanish
                and if possible in Arabic - of a practical guide to the GSP ;
              - Updated statements for use by importers and exporters of the unused
                quota under each ceiling subject to surveillance and each individual
                maximum country amount linked to that ceiling ( l ) ;
              - Organization of GSP users' meetings .
          c ) Providing advice   for GSP users and industry in developing countries :
              - On the advantageous effects of the GSP on trade contracts yet to
                be awarded ;
              - Through market -by-market or product -by-product factual evaluations in the
                Community .
      2 . The Trade Promotion Department will be responsible for the technical preparatior.
          of execution of the activities described below , in accordance with pro­
          grammes agreed upon by the Commission following the appropriate procedures
                                                                                       -/5
     ( l ) The Commission is in the course of investigating what are the most suitable
           means of ensuring that the Agency    achieves its objectives   in  the
           fields of statistics and data-processing . It will inform the Council as soon
           as possible of the result of this investigation .
 ---pagebreak---      in force for the EDF or for the general budget ( see Annex i/B ).
     a) Assistance for participation by the developing countries in
         trade events
         - Organization of fairs and "trade fortnights " in Europe and
           the developing countries .
     b ) Organization of trade missions and seminars
         - Missions by European buyers to the developing countries ;
         - Missions by producers from the developing countries to Europe
            and , as part of these trade missions , the organization in the
            Member States of information seminars to provide an introduction
            to sales techniques and other more specific subjects .
     c ) Training and technical assistance
         - Organization of training courses for the staff employed by the
            governments of the developing countries in the various official
            agencies responsible for the promotion of foreign trade and for
            commercial representation abroad ;
         - Providing experts to give technical assistance in setting up
            bodies such as Foreign Trade Centres or to help the public
            authorities to take steps to develop exports . Providing experts
            to help adapt production to market requirements ( quality , design ,
            etc .);
         - Carrying out of market and marketing research for specific products
            and the follow-up to such studies ;
         - Distribution , especially at trade events , of all necessary com­
            mercial literature . Composing technical notes , specialized booklets ,
            lists of trade addresses , etc . In the light of the development of its
            tasks , the Agency will be responsible for hiring consultants and
           qualified experts to carry out missions outside the Community to
           avoid an inappropriate expansion in its own staff .
NATURE OF THE AGEENCY
The Agency will be set up as a European agency with legal personality and
financial autonomy under Commission supervision ( see the establishment
schedule at AnnexIIl ) JEhe Agency 's work will be subject to the rules of bu­
  siness management , receive support from similar national bodies in the
i Member States arid would be in direct contact , as far as necessary, with s
         the developing countries' offices for the promotion of
         foreign trade ;
                                                                          Je
 ---pagebreak---            - the offices of the developing countries' commercial or economic
              representatives ;
           - the private bodies for liaison between the Member States ar <3. the
              developing countries ( Chambers of Commerce , etc .);
           - the private sector , especially business firms .
  VI . STRUCTURE OP THE AGENCY
        The Agency will be headed by an ExecufciveDirector assisted by two Heads
        of Department . The managing Director and the two Heads of Department will
        be appointed by the Commission .                                       •
        The staff structure vail be as unbureaucratic as possible so that it is suited
        to the private sector work requirements . As is customary , it will have admi­
        nistrators (two levels ) and secretaries (two levels ).
        The organization of the GSP Department of the Agency is based on the principle of
        dovetailing responsibilities horizontally ( categories of products) and ver­
        tically ( importers' markets , beneficiary and donor countries). This Department
        consists of two teams ( see Annex i/A).
        The Trade Promotion Department consists of three teams , each corresponding to a
        major field of activity in the promotion of trade ( see Annex I/B).
        The two Departments will have a further service in common , which will deal with
        administration and accounts .
        Details of the staff numbers are given in Annex i/C ),
■ VII . FINANCING THE AGENCY
        The financing of the Agency 's operating costs will be covered by an annual
        subsidy from the budget of the European Communities , as well as by various
        other incomings .
        The Agency will draw up and submit to the Commission for approval , not later
        than 31 March each year , the forecast of its operating costs for the following
        year . The forecast for 1977 is to be found in Annex I/D .
 ---pagebreak--- DIKECTORATE-GMERAL FOR
  EXTERNAL RELATIONS
DIRECTORATE-GENERAL FOR         Brussels , 1st October 1976
      DEVELOPMENT
                        Annexes
                                                            \
                                             κ
 ---pagebreak---                                                                              ANNEX I
DESCRIPTION' AND DISTRIBUTION OF THE TASKS OF THE GSP DEPARTMENT AND OF THE
TRADE PROMOTION DEPARTMENT
A. THE GSP DEPARTMENT
The GSP Department of the Agency will "be responsible , on the basis of Commission
directives and under Commission 's control and responsibility, for three categories
 of activity.
1 . Documentation
The purpose of the documentation work is to collect information essential for a
better knowledge of the GSP 's role in relation to trade and the economy .
To this end the GSP Department will compile and make use of index systems :
- one of importers who use or are affected by the GSP ( urgently requested by the
   beneficiary countries ) ;
- one of exporters in the beneficiary countries who use or are affected by the
   GSP ( requested by the importers ) •                                           *
The GSP Department will undertake factual summaries of the GSP 's impact on the in­
dustrialized countries' export trade , on the beneficiary countries' export
trade and , subject to the information available , on the economy of the developing
countries .
2 . Information
The GSP Department 's first task will .be to publish in all the official languages of
the Community , and in Spanish and Arabic , at the beginning of each calendar year ,
a practical guide to the Community 's GSP . This guide will consolidate the many
regulations and PTO decisions governing each annual scheme into a simplified but
complete and precise manual of instructions accessible to all users ( importers
and exporters ).
The second task will be to make permanently available to importers and exporters a
continuously updated statement of the unused quota under each ceiling subject to
surveillance and each individual maximum country amount linked to that ceiling
( and, if possible , of each tariff quota and the corresponding national quota shares ).
3 . Advice
During a first stage , the GSP Department wiH.be able to make available to GSP users
on the importing and exporting sides the information ( accompanied by appropriate
commentaries based on factual" summaries ) contained in the indexes -
                                                                             2 ./
 ---pagebreak---                                             of the GSP tariff benefits which could
                                            the conclusion of sales contracts .
                                    *
                            *              *
On the basis of these three categories of activity , the staff to be recruited by
the GSP Department would be responsible for the fields briefly described below , subje
to whatever form of organization is decided upon by the future Executive Director
of the Agency .
The distribution of responsibilities is based on three key ideas :
- the staff structure will be as unbureaucratic as possible so that it can be
   adjusted to the private sector 's requirements : it will be made up mainly of
   administrative and assistant administrative staff and of secretaries recruted
   on the basis of their qualifications and experience in the field of international
   trade ;
- team work and joint responsibility will be the rul6 to prevent the illness or
   temporary absence of an official from blocking the activity of the Department
   especially as regards the collection and distribution of information regarding
   use of the GSP ;
- areas of responsibility will allocated horizontally ( by categories of products )
   and vertically ( import markets , beneficiary countries , donor countries )}
Two teams , each with its own specific terms of reference , will be responsible for
carrying out these tasks .
1 . The first team will be a guidance and liaison unit responsible for :
- summarizing the use made of the GSP at the level of the various categories of
   product , the markets of the Member States and the markets of the beneficiary
   countries ;
                                                                                3 ./
 ---pagebreak---  - liaison with the Comm ssion 's departments ;
 - preparing the GSP guide ;
 - liaison with the corresponding organizations and the importers and industries
   concerned in the Member States and the beneficiary countries ;
 - organizing meetings of GSP users ;
 - studies and . advice on the use of the GSP .
 The second team will collect sectoral information and undertake analyses . This
 section will compromise three specialized subsections responsible respectively
 for the following sectors , which correspond to three specific areas of application
 of the GSP :
    agricultural products ( chapters 1 - 24 of the CCT ), including agricultural pro­
    ducts subject to tariff quotas ; markets of the United Kingdom , Ireland and
    Denmark ;
 -  textile products and industrial products subject to tariff quotas or "hybrid"
    ceilings ; markets of France and Italy ;
 -  semi-sensitive products with ceilings to subject to surveillance and non-sensitive
    products ; markets of Germany and Benelux .
For its analyses , the team     will make use of the index of importers using the GSP
and the index of exporters in the beneficiary countries using the GSP . It will have
available for use the statistical data relating to the GSP in the three sectors
referred to above and provide specialized infonnation on each product involved .
                                                                             4 ./
 ---pagebreak---                                                             ANNEX I
B , THE TRADE PROMOTION DEPARTMENT
The Trade Promotion Branch will be responsible , on the basis of Commission
directives and under Commission supervision, for all activities relating to the
execution of the trade promotion programmes and projects decided upon by the Com­
mission in favour of the associated and non-associated developing countries .
These tasks will be carried out by three teams each specialized in field
requiring specific qualifications .
1 . The first team will be responsible for the participation by the developing
    countries in trade events included in the Community programmes in favour of the
    associated and non-associated developing countries . Its duties will cover :
    - contacts with the management of fairs and specialized shows with a view to
      selecting and reserving exhibition sites ;
    - contacts with major stores with a view to organizing " seminars" or " trade
      fortnights" for one or more developing countries ;
    - contacts with the developing countries' trade promotion departments and
      offices with a view to determining the details of their participation s
      area of stands , nature of construction, choice of materials , interior fittings ,
      decoration, additional equipment , products exhibited ( quantities , volumes ,
      etc .);
    - contacts with specialized bodies with a view to encouraging participation
      and with the mass media for the dissemination of information on the events ;
    - contacts with trade organizations in Europe and in the developing countries
      with a view to the preparation , at trade fairs and shows , of meetings between
      those in the trade in order to improve the exchange of information between
      firms ;
    - preparation of meetings ( halls , organization and secretarial assistance ) ;
    - hiring sites for the stands in fairs and large stores ;
    - preparation of invitations to tender for the construction of the stands ;
    - construction of the stands ;
    - evaluation of the results of the participation by the developing countries in
      the trade events in terms of trading results and improvement of the quality
      of participation •
                                                                              5 ./
 ---pagebreak---                                                                                         5 .-
                                                                                ANNEX I
2.   The second team will be responsible for organizing trade missions and its tasks
     will cover :
     - studies , in liaison with European trade organizations , relating to European
        purchasing missions in the developing countries ;
     - approachs to the developing countries' promotion offices with a view to the
        organization of such missions in the country concerned ;
     - negotiations with trade organizations on the nature and amount of Community
        contributions ;
     - contacts with public or private bodies in the Member States that could assist
        the Community with the organization of these missions ;
     - contacts with travel agencies for the practical preparation of the missions ;
     - evaluating the trading results of the missions in question, in liaison with . the
        subcontracting organizations .
 3 . The third team will be responsible for training schemes in the areas of
     trade and technical assistance and its main duties will be :
     - preparation of seminars in the developing countries on marketing and inter­
       national trade questions ;
     - recruiting firms or individuals to take charge 0 f the courses , conferences
       product -by-product studies , group discussions , etc .;
     - examining the developing countries' request for technical assistance in the
       very varied fields of marketing and sales promotion ( quality , presentation,
       packaging, transport , agents , design, et .), discussion with the representatives
        of the applicant developing countries of the job descriptions and evaluation of
       the results of these operations on the basis of reports supplied by the
        individuals or firms with whom contracts have been concluded .
                                                                                  6./
 ---pagebreak---                                                                  ANNEX I –
- market research and surveys and , in general , trade information and documentation
  work ;
- the implementation of any trade promotion schemes adopted by the Commission
  in favour of one or more developing countries . In general this involves
  promotion campaigns for a product on the market of one or more Member States ;
- examining , together with the developing countries , the trade documentation
  they are preparing with the Community 's aid and participation in drafting
  information sheets on products , specialized brochures and all other specialized
  documentation .
                                                                          7 ./
   \
 ---pagebreak---                                                                               7.
                                                                   ANNEX I
C. THE AGENCY 'S STAFF COMPLEMENT
The staff are allocated as follows
Managerial staff                        8
Administrative staff                   10
Technician                              1
Administrative and accounting officer   1
Secretarial staff                      12
Subordinate staff                       2
                                       34
   In the opinion of the Commission the staff complement of 34 people matches
up to the tasks of the Agency as described . Recrutment of personal will be
carried out in a progressive manner as and when the different services of the
Agency are brought into operation in relation to the development of their
activities .
                                                                         8 ./
 ---pagebreak---                                              MNE3C I
ORDER OP MAGNITUDE OP ANTICIPATED COSTS
                                            u.a .
1 . Initial installation costs            180.000
2 . Operating costs                       120.000
3 . Expenditure on staff                  750*000
                                        1.050.000
 ---pagebreak---                                                               ANNEX -L-
                                                              CONFIDENT IAL
                              REPORT
    on the creation of the GSP Documentation , Study and Advisory Agency
By contract .signed with the Commission of the European
Communities , the undersigned was charged , with a view to the
establishment of the GSP Documentation , Study and Advisory
Agency , with carrying out the following task on the
Commission 's behalf :
  ( i ) identifying the problems facing industries and importers
        associations as a result of the generalized preferences
        and sounding out the ideas of national authorities on
        what the function of the Agency should be ;
( ii ) making any suitable suggestions as to the tasks to be
        assigned to the Agency and as to its operation .
This is a report on the results of the mission which the
undersigned was required to undertake .
 ---pagebreak---                                 - 2 -
                                                                  ANWEX II
                          Introduction
As soon as the first approaches had "been made it proved necessary
to sound out the "beneficiary countries of the Community 's GSP too
in order to identify correctly their needs and desiderata . In
agreement with DG I , these surveys were carried out with the help
of the UNCTAD/UNDP team responsible for the GSP seminars project ,
that of the Indian representatives ( India was the first country
to support the idea of an Agency and to press for its creation
subsequently), that of ASEAN and the Central American countries .
The first part of this report will sum up the main basic ideas
which represent the points on which the views of each of these
groups converged most closely . It will then set out , in the second
part , the tasks to be undertaken by the Agency as suggested by these
generally-held ideas and then make a few suggestions as to the
operation of the Agency .
I. The creation of the Agency : the ideas of the national authorities
and the desiderata of the developing countries and of the private
sector in the Community
As far as the national authorities are concerned , the need for
the Agency is recognized . It should form the key element in the
back-up for the generalized preferences .
The Agency should be used as the instrument par excellence for
improving the utilization of the GSP , in other words :
  ( i ) easier use for all beneficiaries (the GSP scheme is very
        complex) ;
( ii ) more widespread use if possible over the whole Community and
        a greater use quant it ively through better adaptation to the
 ---pagebreak---                                   - 3 -
                                                                   ANKEX -I
         structural and cyclical trend of business in the Community
         ( the sensitive and semi-sensitive sectors have reached
         saturation point as regards improvement ;  imports under
         the GSP are concentrated on the first sector and to a
         lesser degree in the second sector , while in the sector of
         non-sensitive products there are great opportunities for a
         wide range of products and on a large scale );
 ( iii ) better spread of utilization among the various "beneficiaries
         ( over 50% of imports under the GSP in the sectors of
         sensitive and semi-sensitive products come from five
         beneficiaries ) ;
   ( iv) more profitable utilization for exporters in the developing
         countries ( because of insufficient information and no real
         security at the technical level for imports under the GSP ,
         exporters hardly benefit from the financial advantages
         resulting from the duty-free arrangements ).
The Agency should also be designed to fulfil the needs and
desiderata of the beneficiary countries and their regional
economic groupings in a practical manner . In this connection ,
it was stressed by all that the Agency , which is aimed at
countries not associated with the Community , represents above all
a political effort illustrating the Community 's will to take on
more responsibility in respect of those countries following the
successful conclusion and bringing into operation of the ACP-EEC
Convention of Lom£ . This is why particular attention should be
paid to turning the Agency to good account . This should be done
in such a way - particularly as far as the timing and choice of
international context are concerned - as to enable the Community
to draw the maximum political benefit from it .
Prom the angle of industry the business situation is not favourable
to new initiatives to promote the GSP . Although the GSP is not
being called in question , there are doubts about the utilization -
described as abusive - of the GSP by certain over-competitive
countries . There is interest in the Agency as an instrument to
moderate imports under the GSP , which ought to be reserved
primarily to those from the developing countries that most need to
export under the scheme . It is recognized that the Agency , in time
 ---pagebreak---                                                                  ANNEX I
and given certain conditions , could be useful for establishing
conversion measures , preparing for the transfer of certain
industrial activities to the southern hemisphere and working
out investment policy for firms .
For importers , the Agency fills a need . The International
Wholesale and Foreign Trade Centre , which embraces the national
horizontal organizations and European sectoral organizations ,
stressed the problem of uncertainty as to whether customs duties
are to be reintroduced , which tends to complicate the award of
purchasing contracts , and thought that the Agency should deal
with the resultant difficulties . The importers are aware that
their role is important :   it is upon them and upon the consumers
that the success and coverage of the GSP depend in the final
analysis , especially when business conditions are difficult .
The Agency could help them by enabling them to become better
acquainted with the exporting firms in the beneficiary countries ,
their export products and , last but not least , the export barriers .
For a number of beneficiary countries which are reasonably
representative , such as India and the ASEAN and Central American
Common Market countries , the Agency - the creation of which was
announced a long time ago and has now become urgent - could play
a key role in improving GSP utilization. The question of security
at the legal and technical levels crops up again and again: how
can one make any industrialization plans ( one of the three agreed
objectives of the generalized preferences) when the GSP may at any
time be reduced , or even withdrawn, since it is completely
autonomous and often even arbitrary? How is it possible to negotiate
sales contracts on good terms when the exporters cannot foresee the
moment when the customs duty will be reintroduced? Inadequate
knowledge of the GSP and the general lack of information on EEC
markets place the developing countries' exporters in a situation
where they are greatly dependent on importers . It will not , of
course , be the Agency* s job to solve political problems such as
those concerning the duration of the GSP and security at the legal
level ; it could , nonetheless , contribute towards attenuating
certain difficulties on the practical level . It could , for example ,
provide a certain degree of security at the technical level by makirg
available to exporters among other things , up-to-date information on
the degree of utilization of each quota (and each national quota share)
 ---pagebreak---                                - 5 -
                                                                 AMEX ■-
and of each ceiling , which is not yet possible at present . It
could publish for each product information on the trend of GSP
utilization and of imports over past years so that exporters
have access to data on the size of the market and on competition.
Above all , it should set up a central index of all importers by
branch of industry . Every year , it should publish , in the most
common languages , a guide to the very complex rules governing
the annual schemes . It should also arrange meetings for GSP
users : importers , exporters and even candidates for industrial
cooperation projects . (A point that was emphasized was the
provision of simultaneous interpretation because the language
question was in many instances a major barrier to the development
of contacts .) Finally , the Agency would enable exporters to
have direct access to the information they need ; this would
facilitate the task of the beneficiary countries * authorities
and. that of their diplomatic missions accredited to the :
Community .
For the representatives of the UNCTAD Secretariat , and particularly
for the UNCTAD/UUDP team working on the GSP project the Agency
would be a precious instrument for promoting a better knowledge
of the GSP and especially of its impact , which would make it
easier to improve the utilization of the GSP and give a better
distribution of the burden among the donor countries . The UNCTAD
Secretariat expects the example given by the Community to be
followed by other donor countries . It is prepared to cooperate
with the Agency in the exchange of exparience and information
of all kinds .
II .  Suggestions as to the tasks to be allotted to the Agency and
its operation
1.   The Agency's tasks
In the light of the requirements and desiderata described above ,
three types of task should be allotted to the Agency .
 ---pagebreak---                                - 6 -
                                                                  AMEX II
 Providing documentation and irn_ormat ion
 The Agency's first task would be to publish in all the official
 languages of the Community and in Spanish , at the beginning of
 each calendar year , a practical guide to the Community's GSP .
 This guide would transform the numerous regulations and
 decisions governing each annual scheme into a simplified but
 complete and precise manual of instructions , easily understood
 by all users ( importers and exporters ).
The second task would consist in keeping , for use by importers
 and exporters , constantly updated statements of the unused
 quota under each ceiling subject to surveillance and each
 individual maximum country amount linked to that ceiling (and ,
 if possible , of each tariff quota with its national quota
 shares ).
Undertaking £tudies
The purpose of undertaking studies is to provide as systematic
 informatior as possible on the GSP 's role in relation to trade
and economy .
For this work , the Agency would base itself on three indexes it
would have to compile :
    ( i ) one of importers who use or are affected by the GSP
          (urgently requested by the beneficiary countries );
  ( ii ) one of exporters in the beneficiary countries who use or
          are affected by the GSP ( requested by the importers );
 (iii ) a comparative index of imports under the GSP into the
          preference-giving countries .
The analyses and studies to be carried out by the Agency would
concern the GSP 's impact on the industrialized countries' import
trade , on the beneficiary countries' export trade and , subject
to the information available , on the economy of the developing
countries .
Providing advice
The Agency would not be able to provide a true advisory service
in the initial stages . It would be able to do this only later ,
 ---pagebreak---                                                                  ΑΪΓΝΕΧ
when it had built up a sufficient store of experience and when
a number of political options had been taken at Community level .
During an initial stage , the Agency's scope in its advisory
capacity would be somewhat restricted . To start with , it would
make available to GSP users on the importing and exporting sides
the information (accompanied by appropriate commentaries based
on detailed analyses ) contained in the indexes of importers and
exporters referred to above . Secondly, it would provide them
with opportunities to meet and organize meetings for them
together with the essential infrastructure . Precise details
would also be supplied to all interested exporters , on a product-
by-product basis , of the extent of the GSP tariff benefits which
could be turned to good advantage to facilitate the conclusion
of sales contracts .
At a later date , the Agency would be able to extend its advisory
activities :
    ( i ) for exporters by encouraging or facilitating the trade
          promotion of the developing countries * industrial
          manufactured products in the context of the GSP ;
  ( ii) for developing countries * industries by providing them
          with analyses of the prospects on the sectoral markets
          or even for specific products in the Community;
( iii ) for Community industries by providing data on the
          opportunities for extending their activities and
          establishing themselves in the developing countries .
2.     The Agency's operation
To enable the Agency to carry out the threefold task sketched
out above , a number of conditions have to be met .
First , as far as the design of the Agency itself is concerned ,
the idea is to set up an operational instrument that is
effective and in as close touch as possible with the users .
It should be neither a civil service department nor a
consultancy bureau but a centre that provides a service and is
 ---pagebreak---                              - 8 -
                                                              ANNEX II
at the disposal of business firms . Placed under Commission
supervision, the Agency should be able to operate in a
sufficiently autonomous manner to adapt itself constantly
to the working conditions and needs of the business world.
The Agency should adopt the operational style of working used
in the private sector .
The Agency should be provided with the appropriate means .
The creation of a large urrwiedly staff should be avoided : ten
or so executive officers , with assistants and secretaries
should suffice . The equipment should include adequate computer
facilities and meeting rooms equipped for simultaneous
interpretation. The Agency should be able to rely on having
a sure supply of basic data , for example on use being made of
the GSP (from the Commission and the national authorities ).
Finally, concerning work methods , the Agency should concentrate
to start with on the documentation and information side of its
task . Only gradually , as it builds up its resources , will the
Agency be able to begin carrying out studies and providing
advice . The Agency should work in constant liaison with national
centres of the same type ("Import Opportunities Office for the
Developing Countries" in the United Kingdom", Centrum tot
bevordering van de import uit ontwikkelingslanden" in the
Netherlands , "Bundesstelle fur Aussenhandelsinformation" in
Germany, and so on) and cooperate with the GATT/UNCTAD Trade
Promotion Centre and the UNCTAD Secretariat .   In the initial
stages the first bodies to receive the information on the unused
balance of ceilings and tariff quotas should be the International
Wholesale and Foreign Trade Centre and the trade promotion
institutes of the beneficiary countries . In setting up the
indexes of importers and exporters , the Agency should draw on
the experience of the Import Opportunities Office for the
Developing Countries which uses the "Company profile" formula
to identify the firms requesting its services .
                                        Brussels , 10 January 197°
                                              M.V. di Martino
 ---pagebreak---                                                   Annex TTT
PROPOSAL FOR A COUNCIL REGULATION ESTABLISHING A EUROPEAN
AGENCY FOR TRADE COOPERATION WITH THE DEVELOPING COUNTRIES
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic
Community, and in particular Articles 113 and 235 thereof ,
Having regard to the proposal from the Commission,
Having regard to the Opinion of the European Parliament ,
Having regard to the Opinion of the Economic and Social Committee ,
Whereas by its resolutions of 30 April 1974 and 3 March 1975
the Council reiterated its wish to improve the use of the
generalized preferences scheme and actively to contribute
towards the development of trade relations with the developing
countries ; whereas it has to this end requested the Commission
to put before it concrete proposals for the implementation of
the resolutions adopted;
Whereas the appropriate use of the Community * s generalized
preferences scheme and the exercise of the responsibilities
incumbent upon the Community in the matter of trade promotion
for the benefit of the developing countries raise particularly
wide–ranging and complex problems because of the volume of
trade involved and the interests at stake and whereas the
relevant implementing measures to be taken in the Community
and the developing countries must be carried out under optimum
conditions ;
Whereas , with a view to facilitating Commission action and
making administration as flexible as possible at the level of
execution, a European Agency for Trade Cooperation with the
Developing Countries should be set up as a decentralized body
managed on business lines and under the supervision of the
Commission, for which it will receive directives ;
 ---pagebreak---                        - 2 -                          Annex
Whereas the Treaty has not provided the specific powers
necessary for setting up such an Agency ;
Whereas the Agency will be set up within the framework of
the European Communities and will function in accordance
with Community law and with the directives given to it by
the Commission, and whereas the conditions under which
certain general provisions will apply should be defined,
HAS ADOPTED THIS REGULATION:
                             Article 1
A European Agency for Trade Cooperation with the Developing
Countries , hereinafter called the "Agency", is hereby set up .
It shall have legal personality.
In each of the Member States, it shall enjoy the most extensive
legal capacity accorded to legal persons .   It shall exercise
its activity exclusively in the general interest .
It shall be non–profit making.
It /shall be managed on business lines .
The Agency shall have its seat in Brussels .
                             Article 2
The aim of the Agency shall be to facilitate by means of
practical measures the achievement of the Community 's objectives
in the sphere of trade relations with the developing countries .
( i ) as regards generalized preferences its task shall be to
provide information, documentation and advice for business firms ,
in particular Community importers and developing country exporters .
 ---pagebreak---                                                           Annex ill
( ii ) as regards trade promotion, its task shall be the
execution of projects and action programmes defined and
approved by the Commission.
 The Agency shall , where necessary , ensure complementarity ir
these two fields .
In carrying out the tasks entrusted to it by the Commission
the Agency shall cooperate closely with the national bodies
of the Member States specializing in trade cooperation with
the developing countries and shall establish appropriate
contacts with those concerned.
                             Article 3
The Agency shall be run by a Managing Director assisted by
two Heads of Department .    The Managing Director and the two
Heads of Department shall be appointed by the Commission.
Their term of office shall be three years and shall be
renewable .   The Managing Director and the Heads of Department
may be dismissed by the Commission.
                             Article 4
 The Managing Director shall be responsible to the Commission for
 the administration of the Agency. In the performance of his duties
the Managing Director shall observe the general and specific directives
given to him by the Commission . He shall in all circumstances submit
to supervision by the Commission and be accountable to it .
The Managing Director shall be the legal representative of
the Agency .
The Managing Director may delegate his powers to the Heads
of Department or to members of the staff of the Agency.
                             Article 5
The Managing Director shall be assisted by a Management
Committee composed of four members appointed by the Commission
and selected from within the Commission's departments
responsible for implementation of the generalized system of
preferences and for trade promotion activities .
 ---pagebreak---                        - 4 -
                                                        Annex III
The task of the Management Committee shall be to advise the
Managing Director , either at his request or on its own initiative .
The Chairman shall convene the Management Committee at least
twice a year, as agreed with the Managing Director.
                       Article 6
The Managing Director shall , by 31 March each year at the
latest , send the Commission the operating budget of the
Agency for the following year .   This budget , which shall
include an establishment plan, shall be forwarded by the
Commission to the Council with the preliminary draft budget
of the European Communities .
The budget of the European Communities shall each year, under
a specific heading, include a subsidy for the operating of the
Agency .
The Managing Director shall adopt the estimate of revenue and
expenditure before the beginning of the financial year,
adjusting it to the subsidy granted by the budgetary authority.
                       Article 7
The Commission shall communicate the annual action programmes
to the Managing Director of the Agency so that they can be
carried out as soon as possible after the Community budget
has been approved.
Projects not contained in the annual action programmes shall
be sent to the Managing Director of the Agency as and when
they have been approved.
The appropriations to cover the operational expenditure of
each Department of the Agency shall be fixed by the Commission
when it sends each programme or project to the Agency.
 ---pagebreak---                                                         Annex III
                       Article 8
The Managing Director shall , by 31 March each year at the
latest , prepare an annual general report on the activities
and financial situation of the Agency for the preceding
year and shall submit it , after receiving the opinion of the
Management Committee , to the Commission .
                       Article 9
A balance sheet adopted on 31 December, to which a revenue
and expenditure account is annexed, shall be drawn up annually .
It shall be addressed, by 1 March at the latest , to the Audit
Board provided for in Article 206 of the Treaty, which shall
report on the Agency's accounts .
The Managing Director shall each year draw up a management
report on the preceding financial year .   The Commission shall
receive, by 1 May at the latest , the balance sheet , the Revenue
and expenditure account , the report of the Audit Board and the
management report of the Managing Director and shall grant the
latter a discharge in respect of his management duties .
The above documents shall be annexed to the accounts of the
preceding year and the Commission shall submit them annually
to the Council and the European Parliament pursuant to the
fourth paragraph of Article 206 of the Treaty.
                       Article 10
The provisions governing the staff of the Agency shall be
adopted by the Council , acting on a proposal from the Commission .
                        Article 11
The Managing Director, the two Heads of Department , the staff
and all other persons participating in the activities of the
Agency shall be required, even after their duties have ceased,
not to disclose information of the kind covered by the
obligation of professional secrecy.
                        Article 12
The Protocol on the Privileges and Immunities of the European
Communities shall apply to the Agency.
 ---pagebreak---                                                      Annex III
                         Article 13
The contractual liability of the Agency shall be governed by
the law applicable to the contract in question.
The Court of Justice of the European Communities shall have
jurisdiction to give judgment     pursuant to any arbitration
clause contained in a contract concluded by the Agency .
In the case of non-contractual liability, the Agency shall ,
in accordance with the general principles common to the laws
of the Member States , make good any damage caused by the
Agency or its servants in the performance of their duties .
The Court of Justice shall have jurisdiction in disputes
relating to compensation for any such damage .
                         Article 14
Member States , membefls of the Management Committee of the
Agency and third parties directly and personally involved may
refer to the Commission any act of the Agency, whether express
or implied, for the Commission to examine the legality of
that act .
Referral shall be made to the Commission within fifteen days
of the day on which the party concerned first became aware
of the act in question.
The Commission shall take a Decision within one month .      If
no Decision has been taken within this period, the case shall
be deemed to have been dismissed.
                         Article 15
The Commission is authorized to take all steps required for
the setting up and operation of the Agency and its bodies .
The initial cost of setting up the Agency shall be charged
to the Communities' budget .
                         Article 16
This Regulation shall enter into force on the third day
following its publication in the Official Journal of the
European Communities .
 ---pagebreak---                                                      Annex III
This Regulation shall be binding in its entirety and
directly applicable in all Member States .
Done at Brussels .                            Por the Cotincil
                                              The President
 ---pagebreak---                            FINANCIAL RECORD
               drawn up for the 1976-1977 budget years
A. PART I j INTERVENTION APPROPRI ATI GNS
   Establishment of a European Agency for Commercial Cooperation with the
   developing countries .
   1 . RELEVANT BUDGET HEADING CODE
       A new heading has to be created
   2 . TITLE OP BUDGET HEADING
       Aid for the operation of the European Agency for commercial cooperation
       with the developing countries
   3 . LEGAL BASIS
       113 and 235 EEC
   4 . DESCRIPTION , OBJECTIVES AND JUSTIFICATION OF THE PROJECT
       The mission of the Agency is to carry out duties intended to facilitate
       generally the achievement of the Community 's objectives in the field of
       trade relations with the developing countries through practical schemes
       in two distinct but complementary fields : use of the GSP and trade
       promotion *
   5. FINANCIAL APPROPRIATIONS ( in u.a.)
       5.0  MULTI-ANNUAL TIMETABLE
            1977 i    760.000 u.a.
            1978 :    870.000 u.a.
       5.1  PATTERN OF UTILIZATION DURING 1HE FINANCIAL YEAR NOW BEING PREPARED
            The expenditure to be incurred during the financial year will be
            concerned with appropriations for operating . The Agency should
            start to operate at the beginning of 1977 and will reach its normal
            pattern of activities in 1978 .
       5.2  MS1H0B OF CALCULATION
            For the equipment and the rent the prices have been caloulated on
            the basis of those In effect in Brussels in 1916 ,
                                                3>>
 ---pagebreak---          For staff costs salaries have teen calculated on the "basis of
         those which have been estimated for similar posts in the private
         sector plus expatriation allowances .
6 . TYPE OP CQNTROL TO BE APPLIED
    The rules for financial control will be those provided by the financial
    regulation of 25 April 1973 »
PART 2 : ADDITIONAL DATA TO BE PROVIDED FOR A NEW PROJECT (*)
7 . OVERALL COST OF THE PROJECT FOR THE WHOLE OF ITS EXPECTED DURATION
    The Agency 's operating costs during the first year will be 1,050,000 u.a .
    Its operations will trontinue thereafter without it being possible to estimate
    the overall cost .
8 . INFORMATION REGARDING STAFFING AND THE APPROPRIATIONS FOR ADMINI 5 2PATIV5
    EXPENDITURE NECESSARY FOR THE IMPLEMENTATION OF THE PROJECT
    The project will be implemented without affecting the present staffing
    of the Commission and does not necessitate additional administrative
    expenditure for the Commission .
9 . PROJECT FINANCED FROM
    The Budget of the European Communities .
Th9 Commission Decision of 28 November 1973 on new budget procedures mentions
the need to draw up a " financial memorandum " for each new project consisting
of the two parts of this financial record .
                                                  IH