21999A1204(02)

21999A1204(02) 21999A1204(02) Agreement on Trade, Development and Cooperation between the European Community and its Member States, of the one part, and the Republic of South Africa, of the other part - Protocol 1 concerning the definition of the concept of 'originating products' and methods of administrative cooperation - Protocol 2 on mutual administrative assistance in customs matters - Final Act - Declarations Official Journal L 311 , 04/12/1999 P. 0003 - 0415  Dates: of document:   11/10/1999 of effect:   01/05/2004; Entry into force See Art 109 And OJ C 116/2004 P. 0023 of effect:   01/01/2000; Provisional application See 299A1204(01) of signature:   11/10/1999; Pretoria end of validity:   99/99/9999 Authentic language: The official languages ; German ; English ; Danish ; Spanish ; Finnish ; French ; Greek ; Italian ; Dutch ; Portuguese ; Swedish ; Other than Community language Author: European Community ; The 15 Member States ; Belgium ; Denmark ; France ; Finland ; United Kingdom ; Greece ; Italy ; Ireland ; Luxembourg ; Netherlands ; Sweden ; Portugal ; Spain ; Austria ; South Africa Subject matter: External relations ; Association ; Cooperation Directory code: 11403000 EUROVOC descriptor: economic development ; EC cooperation agreement ; EC trade agreement ; South Africa Legal basis: 197E300-P2L1F1............ Adoption 197E300-P2L1F2............ Adoption 197E310................... Adoption Instruments cited: 291A0817(01).............. 294A1223(01).............. 294A1223(09).............. 294A1223(10).............. 294A1223(14).............. 294A1223(16).............. 294A1223(17).............. 294A1230(01).............. 297A0811(01).............. 298A0529(01).............. Amended by: Relation...... 299A1204(01)...... Partial provisional application from 01/01/2000 Implemented by 399R2793.......... DP31/12/99 Amended by.... 202A0130(05)...... Amendment ANN 4 from 01/01/2002 Amended by.... 202A0130(05)...... Amendment ANN 10 from 01/01/2002 Subsequent related instruments: Relation...... 204X0430(01)...... AGREEMENT on Trade, Development and Cooperation between the European Community and its Member States, of the one part, and the Republic of South Africa, of the other part THE KINGDOM OF BELGIUM, THE KINGDOM OF DENMARK, THE FEDERAL REPUBLIC OF GERMANY, THE HELLENIC REPUBLIC, THE KINGDOM OF SPAIN, THE FRENCH REPUBLIC, IRELAND, THE ITALIAN REPUBLIC, THE GRAND DUCHY OF LUXEMBOURG, THE KINGDOM OF THE NETHERLANDS, THE REPUBLIC OF AUSTRIA, THE PORTUGUESE REPUBLIC, THE REPUBLIC OF FINLAND, THE KINGDOM OF SWEDEN, THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND, Contracting Parties to the Treaty establishing THE EUROPEAN COMMUNITY, hereinafter referred to as the "Member States", and THE EUROPEAN COMMUNITY, hereinafter referred to as the "Community", of the one part, and THE REPUBLIC OF SOUTH AFRICA, hereinafter referred to as "South Africa", of the other part, hereinafter referred to as the "Parties", CONSIDERING the importance of the existing links of friendship and cooperation between the Community, Member States and South Africa and the common values that the Parties share; CONSIDERING that the Community, Member States and South Africa wish to further strengthen these links and to establish close and lasting relations based on reciprocity, partnership and co-development; RECOGNISING the historical achievements of the South African people in abolishing the apartheid system and building a new political order based on the rule of law, human rights and democracy; RECOGNISING the Community's and Member States' political and financial support to this process of political change and transition in South Africa; RECALLING the firm commitment of the Parties to the principles of the United Nations Charter and to democratic principles and fundamental human rights as laid down in the Universal Declaration on Human Rights; BEARING IN MIND the Cooperation Agreement between South Africa and the European Community which was signed on 10 October 1994; RECALLING the wish of the Parties to establish the closest possible relationship between South Africa and the countries of the ACP-EC Lomł Convention as reflected in the signing, on 24 April 1997, of the Protocol governing the accession of South Africa to the fourth ACP-EC Convention of Lomł, as amended by the Agreement signed in Mauritius on 4 November 1995; TAKING ACCOUNT of the Parties' rights and obligations in terms of their membership of the World Trade Organisation (WTO), the need to contribute to the implementation of the results of the Uruguay Round, and the efforts already made by both parties in this respect; RECALLING the importance attached by the Parties to the principles and rules which govern international trade and to the need to apply them in a transparent and non-discriminatory manner; CONFIRMING the Community's and Member States' support and encouragement for the process of trade liberalisation and economic restructuring currently under way in South Africa; RECOGNISING the efforts by the South African Government to ensure economic and social development for the people of South Africa; EMPHASISING the importance both the European Union and South Africa place on the successful implementation of the South African reconstruction and development programme; CONFIRMING the commitment of the Parties to promote regional cooperation and economic integration between the countries of southern Africa, and to encourage the liberalisation of trade between those countries; BEARING IN MIND the Parties' commitment to ensure that their mutual arrangements do not impede the process of restructuring the Southern African Customs Union (SACU), which links South Africa to four ACP States; UNDERLINING the importance which the Parties attach to the values and principles set out in the Final Declarations of the International Conference on Population and Development held in Cairo in 1994, of the World Summit for Social Development held in Copenhagen in March 1995 and of the Fourth World Conference on Women held in Beijing in 1995; REAFFIRMING the commitment of the Parties to economic and social development and the respect for the fundamental rights of workers, notably by promoting the relevant International Labour Organisation (ILO) Conventions covering such topics as the freedom of association, the right to collective bargaining and non-discrimination; the abolition of forced labour and child labour; RECALLING the importance of opening a regular political dialogue in bilateral and multilateral contexts on issues of common interest, HAVE AGREED AS FOLLOWS: TITLE I GENERAL OBJECTIVES, PRINCIPLES AND POLITICAL DIALOGUE Article 1 Objectives The objectives of this Agreement are: (a) to provide an appropriate framework for dialogue between the parties, promoting the development of close relations in all areas covered by this Agreement; (b) to support the efforts made by South Africa to consolidate the economic and social foundations of its transition process; (c) to promote regional cooperation and economic integration in the southern African region to contribute to its harmonious and sustainable economic and social development; (d) to promote the expansion and reciprocal liberalisation of mutual trade in goods, services and capital; (e) to encourage the smooth and gradual integration of South Africa into the world economy; (f) to promote cooperation between the Community and South Africa within the bounds of their respective powers, in their mutual interest. Article 2 Essential element Respect for democratic principles and fundamental human rights as laid down in the Universal Declaration on Human Rights, as well as for the principles of the rule of law underpins the internal and international policies of the Community and of South Africa and constitutes an essential element of this Agreement. The Parties also reaffirm their attachment to the principles of good governance. Article 3 Non-execution 1. If either Party considers that the other has failed to fulfil an obligation under this Agreement, it may take appropriate measures. 2. Before doing so it shall supply the other Party, within 30 days, with all relevant information required for a thorough examination of the situation, with a view to seeking a solution acceptable to the Parties. 3. In circumstances of particular urgency, appropriate measures may be taken without prior consultations. These measures shall be immediately notified to the other Party and shall be a subject of consultations, if the other Party so requests. These consultations shall be convened within 30 days from the notification of the measures. If no satisfactory solution is found, the Party concerned may avail itself of the procedure relating to the settlement of disputes. 4. The Parties agree, for the purpose of the correct interpretation and practical application of this Agreement, that the term "circumstances of particular urgency" in paragraph 3 means a case of the material breach of the Agreement by one of the Parties. A material breach of the Agreement consists in: (i) repudiation of the Agreement not sanctioned by the general rules of international law, or (ii) violation of the essential element of the Agreement, as described in Article 2. 5. The Parties agree that the appropriate measures referred to in paragraph 1 of this Article are those taken in accordance with international law and in the selection of these measures, priority must be given to those which least disturb the functioning of this Agreement. Article 4 Political dialogue 1. A regular political dialogue shall be established between the Parties. It shall accompany and help consolidate their cooperation as well as contribute to the establishment of lasting links of solidarity and new forms of cooperation. 2. The political dialogue and cooperation are in particular intended to: (a) promote greater mutual understanding between the Parties and a greater convergence of views; (b) enable each party to consider the position and interests of the other; (c) encourage the support for democracy, the rule of law and the respect of human rights; (d) promote social justice and help create the necessary conditions to eliminate poverty and all forms of discrimination. 3. The political dialogue shall cover all issues of common interest to the Parties. 4. The political dialogue shall take place whenever necessary, notably: (a) at ministerial level; (b) at the level of senior officials representing South Africa, on the one hand, and the Presidency of the Council of the European Union and the Commission of the European Communities, on the other; (c) taking full advantage of all diplomatic channels, including regular briefings, consultations on the occasion of international meetings and contacts between diplomatic representatives in third countries; (d) where appropriate, by any other means or at any other levels to be agreed between the Parties which would make a useful contribution to consolidating the dialogue and increasing its effectiveness. 5. In addition to the bilateral political dialogue provided for in the previous paragraphs, the Parties shall take full advantage of, and contribute actively to, the regional political dialogue between the European Union and the countries of Southern Africa, with a view in particular to promoting lasting peace and stability in the region. The Parties shall also participate in the political dialogue in the larger ACP/EU framework, as foreseen and laid down in relevant ACP/EC Treaties. TITLE II TRADE SECTION A GENERAL Article 5 Free trade area 1. The Community and South Africa agree to establish a Free Trade Area (FTA) in accordance with the provisions of this Agreement and in conformity with those of the WTO. 2. The FTA will be established over a transitional period lasting, on the South African side, a maximum of 12 years and,on the Community side, a maximum of 10 years starting from the entry into force of the Agreement. 3. The FTA covers the free movement of goods in all sectors. This Agreement will also cover the liberalisation of trade in services and the free movement of capital. Article 6 Classification of goods On the Community side, the combined nomenclature of goods shall apply to the classification of goods imported from South Africa. On the South African side, the harmonised system shall apply to the classification of goods imported from the Community. Article 7 Basic duty 1. For each product, the basic duty to which the successive reductions set out in the Agreement are to be applied shall be that effectively applied on the day of entry into force of the Agreement. 2. The Community and South Africa shall communicate to each other their respective basic duties, in accordance with the standstill and rollback commitment agreed between the Parties, and the agreed derogations to these principles, as set out in Annex I. 3. In cases where the process of tariff dismantlement does not start at the entry into force of the Agreement (notably the products listed in Annex II, lists 3, 4 and 5; Annex III, lists 2, 3, 4 and 6; Annex IV, lists 3, 4, 7 and 8; Annex V; Annex VI, lists 2, 3 and 5; Annex VII) the duty to which successive reductions set out in the Agreement are to be applied shall be either the basic duty referred to in paragraph 1 of this Article, or the duty applied on an erga omnes basis on the starting day of the relevant tariff dismantlement schedule, whichever is the lower. Article 8 Customs duties of a fiscal nature The provisions concerning the abolition of customs duties on imports shall also apply to customs duties of a fiscal nature, with the exception of non-discriminatory excise duties levied on both imported and locally-produced goods which are in accordance with the provisions of Article 21. Article 9 Charges having an equivalent effect to customs duties The Community and South Africa shall abolish in their respective imports any charge having an effect equivalent to customs duties on imports on entry into force of the Agreement. SECTION B INDUSTRIAL PRODUCTS Article 10 Definition The provisions of this section apply to products originating in the Community and South Africa with the exception of the products covered by the definition of agricultural products under this Agreement. Article 11 Tariff elimination by the Community 1. Customs duties applicable on import into the Community of industrial products originating in South Africa other than those listed in Annex II shall be abolished on the entry into force of this Agreement. 2. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex II, list 1 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; three years after the date of entry into force of this Agreement the remaining duties shall be abolished. 3. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex II, list 2 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 86 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 72 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 57 % of the basic duty; three years after the date of entry into force of this Agreement each duty shall be reduced to 43 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 28 % of the basic duty; five years after the date of entry into force of this Agreement each duty shall be reduced to 14 % of the basic duty; six years after the date of entry into force of this Agreement the remaining duties shall be abolished. 4. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex II, list 3 shall be progressively abolished in accordance with the following schedule: three years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; five years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; six years after the date of entry into force of this Agreement the remaining duties shall be abolished. For a number of products indicated in this list, tariff elimination will start four years after the date of entry into force of this Agreement. Tariff elimination of these products will take place in three equal annual reductions, to be concluded six years after the date of entry into force of the Agreement. For a certain number of steel products indicated in this list, tariff reduction will be realised on a MFN basis, to arrive at a zero duty in the year 2004. 5. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex II, list 4 shall be abolished within a maximum of 10 years after the date of entry into force of the Agreement. For motor-car components indicated in this list, the applied tariff will be reduced by 50 % as from the entry into force of the Agreement. The precise Community basic duties and tariff elimination schedule for the products on this list will be established in the second six months of the year 2000, after both parties have examined the prospects for a further liberalisation of South African imports of automotive products from the Community mentioned in Annex III, lists 5 and 6, in the light of, inter alia, the outcome of the South African motor industry development programme review. 6. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex II, list 5 shall be reviewed in the fifth year of this Agreement in view of a possible elimination of tariffs. Article 12 Tariff elimination by South Africa 1. Customs duties applicable on import into South Africa of industrial products originating in the Community other than those listed in Annex III shall be abolished upon the entry into force of this Agreement. 2. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 1 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; three years after the date of entry into force of this Agreement the remaining duties shall be abolished. 3. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 2 shall be progressively abolished in accordance with the following schedule: three years after the date of entry into force of this Agreement each duty shall be reduced to 67 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 33 % of the basic duty; five years after the date of entry into force of this Agreement the remaining duties shall be abolished. 4. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 3 shall be progressively abolished in accordance with the following schedule: three years after the date of entry into force of this Agreement each duty shall be reduced to 90 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 80 % of the basic duty; five years after the date of entry into force of this Agreement each duty shall be reduced to 70 % of the basic duty; six years after the date of entry into force of this Agreement each duty shall be reduced to 60 % of the basic duty; seven years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; eight years after the date of entry into force of this Agreement each duty shall be reduced to 40 % of the basic duty; nine years after the date of entry into force of this Agreement each duty shall be reduced to 30 % of the basic duty; 10 years after the date of entry into force of this Agreement each duty shall be reduced to 20 % of the basic duty; 11 years after the date of entry into force of this Agreement each duty shall be reduced to 10 % of the basic duty; 12 years after the date of entry into force of this Agreement the remaining duties shall be abolished. 5. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 4 shall be progressively abolished in accordance with the following schedule: five years after the date of entry into force of this Agreement each duty shall be reduced to 88 % of the basic duty; six years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; seven years after the date of entry into force of this Agreement each duty shall be reduced to 63 % of the basic duty; eight years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; nine years after the date of entry into force of this Agreement each duty shall be reduced to 38 % of the basic duty; 10 years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; 11 years after the date of entry into force of this Agreement each duty shall be reduced to 13 % of the basic duty; 12 years after the date of entry into force of this Agreement the remaining duties shall be abolished. 6. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 5 shall be progressively reduced according to the schedule included in that Annex. 7. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 6 shall be periodically reviewed in the course of the operation of the Agreement in view of the further liberalisation of trade. South Africa will inform the Community about the outcome of the South African motor industry development programme review. It will present proposals for a further liberalisation of South African imports of automotive products from the Community mentioned in Annex III, lists 5 and 6. The Parties will jointly examine these proposals in the second six months of the year 2000. SECTION C AGRICULTURAL PRODUCTS Article 13 Definition The provisions of this section apply to products originating in the Community and South Africa covered by the WTO definition of agricultural products as well as fish and fisheries products (Chapter 3, 1604, 1605 and products 0511 91 10, 0511 91 90, 1902 20 10 and 2301 20 00 ). Article 14 Tariff elimination by the Community 1. Customs duties applicable on import into the Community of agricultural products originating in South Africa other than those listed in Annex IV shall be abolished on the entry into force of this Agreement. 2. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 1 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; three years after the date of entry into force of this Agreement the remaining duties shall be abolished. 3. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 2 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 91 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 82 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 73 % of the basic duty; three years after the date of entry into force of this Agreement each duty shall be reduced to 64 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 55 % of the basic duty; five years after the date of entry into force of this Agreement each duty shall be reduced to 45 % of the basic duty; six years after the date of entry into force of this Agreement each duty shall be reduced to 36 % of the basic duty; seven years after the date of entry into force of this Agreement each duty shall be reduced to 27 % of the basic duty; eight years after the date of entry into force of this Agreement each duty shall be reduced to 18 % of the basic duty; nine years after the date of entry into force of this Agreement each duty shall be reduced to 9 % of the basic duty; 10 years after the date of entry into force of this Agreement the remaining duties shall be abolished. 4. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 3 shall be progressively abolished in accordance with the following schedule: three years after the date of entry into force of this Agreement each duty shall be reduced to 87 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; five years after the date of entry into force of this Agreement each duty shall be reduced to 62 % of the basic duty; six years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; seven years after the date of entry into force of this Agreement each duty shall be reduced to 37 % of the basic duty; eight years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; nine years after the date of entry into force of this Agreement each duty shall be reduced to 12 % of the basic duty; 10 years after the date of entry into force of this Agreement the remaining duties shall be abolished. For certain products referred to in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase down for these products. 5. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 4 shall be progressively abolished in accordance with the following schedule: five years after the date of entry into force of this Agreement each duty and charge shall be reduced to 83 % of the basic duty; six years after the date of entry into force of this Agreement each duty and charge shall be reduced to 67 % of the basic duty; seven years after the date of entry into force of this Agreement each duty and charge shall be reduced to 50 % of the basic duty; eight years after the date of entry into force of this Agreement each duty and charge shall be reduced to 33 % of the basic duty; nine years after the date of entry into force of this Agreement each duty and charge shall be reduced to 17 % of the basic duty; 10 years after the date of entry into force of this Agreement the remaining duties shall be abolished. For certain products referred to in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase-down for these products. 6. Customs duties applicable to processed agricultural products imported into the Community and originating in South Africa are listed in Annex IV, list 5 and shall be applied in accordance with the conditions mentioned therein. The Cooperation Council may decide on: (a) the extension of the list of processed agricultural products under Annex IV, list 5, and (b) the reduction of the duties applying to processed agricultural products. This reduction of duties may take place when in trade between the Community and South Africa the duties applying to basic products are reduced or, in response to reductions resulting from the mutual concessions relating to processed agricultural products. 7. Reduced customs duties applicable to certain agricultural products imported into the Community and originating in South Africa are listed in Annex IV, list 6, and shall be applied as from entry into force of this Agreement and in accordance with the conditions mentioned in this Annex. 8. Customs duties applicable on import into the European Community of products originating in the Republic of South Africa listed in Annex IV, list 7 shall be reviewed periodically in the course of the operation of the Agreement on the basis of future developments in the common agricultural policy. 9. Tariff concessions on products listed in Annex IV, list 8 are not applicable as these products are covered by protected EU denominations. 10. Tariff concessions applicable on import into the Community of products originating in South Africa listed in Annex V shall be applied in accordance with the conditions mentioned therein. Article 15 Tariff elimination by South Africa 1. Customs duties applicable on import into South Africa of agricultural products originating in the Community other than those listed in Annex VI shall be abolished on the entry into force of this Agreement. 2. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 1 shall be progressively abolished in accordance with the following schedule: on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; three years after the date of entry into force of this Agreement the remaining duties shall be abolished. 3. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 2 shall be progressively abolished in accordance with the following schedule: three years after the date of entry into force of this Agreement each duty shall be reduced to 67 % of the basic duty; four years after the date of entry into force of this Agreement each duty shall be reduced to 33 % of the basic duty; five years after the date of entry into force of this Agreement the remaining duties shall be abolished. 4. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 3 shall be progressively abolished in accordance with the following schedule: five years after the date of entry into force of this Agreement each duty shall be reduced to 88 % of the basic duty; six years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty; seven years after the date of entry into force of this Agreement each duty shall be reduced to 63 % of the basic duty; eight years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty; nine years after the date of entry into force of this Agreement each duty shall be reduced to 38 % of the basic duty; 10 years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty; 11 years after the date of entry into force of this Agreement each duty shall be reduced to 13 % of the basic duty; 12 years after the date of entry into force of this Agreement the remaining duties shall be abolished. For certain products indicated in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase down for these products. 5. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 4 shall be reviewed periodically in the course of the operation of the Agreement. 6. Customs duties applicable on import into South Africa of fisheries products originating in the Community listed in Annex VII shall be progressively abolished in parallel with the elimination of customs duties of the corresponding tariff positions by the Community. Article 16 Agricultural safeguard Notwithstanding other provisions of this Agreement and in particular Article 24, if, given the particular sensitivity of the agricultural markets, imports of products originating in one Party cause or threaten to cause a serious disturbance to the markets in the other Party, the Cooperation Council shall immediately consider the matter to find an appropriate solution. Pending a decision by the Cooperation Council, and where exceptional circumstances require immediate action, the affected Party may take provisional measures necessary to limit or redress the disturbance. In taking such provisional measures, the affected Party shall take into account the interests of both Parties. Article 17 Accelerated tariff elimination by South Africa 1. If requested by South Africa, the Community shall consider proposals relating to an accelerated timetable for tariff elimination for imports of agricultural products into South Africa, coupled with the elimination of all export refunds for exports to South Africa of the same products originating in the European Community. 2. If the Community replies positively to this request, the new timetables for tariff elimination and elimination of export refunds shall simultaneously apply as of a date to be agreed by the two Parties. 3. In case of a negative response from the Community, the provisions of this Agreement on tariff elimination shall continue to be applicable. Article 18 Review clause No later than five years after the entry into force of this Agreement, the Community and South Africa shall consider further steps in the process of liberalisation of their reciprocal trade. For this purpose, a review shall be undertaken of, in particular but not exclusively, the customs duties applicable to products listed in Annex II, list 5, Annex III, lists 5 and 6, Annex IV, lists 5, 6 and 7, Annex V, lists 1, 2, 3 and 4, Annex VI, lists 4 and 5 and Annex VII. TITLE III TRADE RELATED ISSUES SECTION A COMMON PROVISIONS Article 19 Border measures 1. Quantitative restrictions on imports or exports and measures having equivalent effect on trade between South Africa and the Community shall be abolished on the entry into force of this Agreement. 2. No new quantitative restrictions on imports or exports or measures having equivalent effect shall be introduced in trade between the Community and South Africa. 3. No new customs duties on imports or exports or charges having equivalent effect shall be introduced, nor shall those already applied be increased, in the trade between the Community and South Africa from the date of entry into force of this Agreement. Article 20 Agricultural policies 1. The Parties may have regular consultations in the Cooperation Council on the strategy and practical modalities of their respective agricultural policies. 2. If either Party, in pursuit of their respective agricultural policies, considers it necessary to amend the arrangements laid down in this Agreement it will notify the Cooperation Council, which will decide on the requested modification. 3. If the Community or South Africa, in applying paragraph 2, amends the arrangements made by this Agreement for agricultural products, it shall make adjustments to be agreed on by the Cooperation Council so as to maintain the concessions on imports originating in the other Party at an equivalent level to that provided for in this Agreement. Article 21 Fiscal measures 1. The Parties shall refrain from any measure or practice of an internal fiscal nature establishing, whether directly or indirectly, discrimination between the products of one Party and products originating in the territory of the other Party. 2. Products exported to the territory of one of the Parties may not benefit from repayment of indirect internal taxation in excess of the amount of indirect taxation imposed on them directly or indirectly. Article 22 Customs unions and free-trade areas 1. The Agreement shall not preclude the maintenance or establishment of customs unions, free-trade areas or other arrangements between either of the Parties and third countries, except in so far as they alter the rights and obligations provided for in this Agreement. 2. Consultation between the Community and South Africa shall take place within the Cooperation Council concerning agreements establishing or adjusting customs unions or free-trade areas and, where required, on other major issues related to their respective trade policy with third countries. In particular, in the event of a third country acceding to the European Union, such consultation shall take place so as to ensure that account can be taken of the mutual interests of the Community and South Africa. Article 23 Anti-dumping and countervailing measures 1. Nothing in this Agreement shall prejudice or affect in any way the taking, by either Party, of anti-dumping or countervailing measures in accordance with Article VI of the GATT 1994, the Agreement on Implementation of Article VI of the GATT 1994, the Agreement on Subsidies and Countervailing Measures, annexed to the Marrakech Agreement establishing the WTO. 2. Before definitive anti-dumping and countervailing duties are imposed in respect of products imported from South Africa, the Parties may consider the possibility of constructive remedies as provided for in the Agreement on Implementation of Article VI of the GATT 1994 and the Agreement on Subsidies and Countervailing Measures. Article 24 Safeguard clause 1. Where any product is being imported in such increased quantities and under such conditions as to cause or threaten to cause serious injury to domestic producers of like or directly competitive products in the territory of one of the Contracting Parties, the Community or South Africa, whichever is concerned, may take appropriate measures under the conditions provided for in the WTO Agreement on Safeguards or the Agreement on Agriculture annexed to the Marrakech Agreement establishing the WTO and in accordance with the procedures laid down in Article 26. 2. Where any product is being imported in such increased quantities and under such conditions as to cause or threaten to cause serious deterioration in the economic situation of the European Union's outermost regions, the European Union, after having examined alternative solutions, may exceptionally take surveillance or safeguard measures limited to the region(s) concerned, in accordance with the procedures laid down in Article 26. 3. Where any product is being imported in such quantities and under such conditions as to cause or threaten to cause serious deterioration in the economic situation of one or more of the other Members of the Southern African Customs Union, South Africa, at the request of the country or countries concerned, and after having examined alternative solutions, may exceptionally take surveillance or safeguard measures in accordance with the procedures laid down in Article 26. Article 25 Transitional safeguard measures 1. Notwithstanding the provisions of Article 24, exceptional measures of limited duration which derogate from the provisions of Articles 12 and 15 may be taken by South Africa in the form of an increase or reintroduction of customs duties. 2. These measures may only concern infant industries or sectors facing serious difficulties caused by increased imports originating in the Community as a result of the reduction of duties envisaged under Articles 12 and 15, particularly where these difficulties produce major social problems. 3. Customs duties on imports applicable in South Africa to products originating in the Community introduced by these measures may not exceed the level of the basic duty or the applied MFN rates of duty or 20 % ad valorem, whichever is the lower, and shall maintain an element of preference for products originating in the Community. The total value of all imports of the products which are subject to these measures may not exceed 10 % of total imports of industrial products from the Community during the last year for which statistics are available. 4. These measures shall be applied for a period not exceeding four years. They shall cease to apply at the latest on the expiry of the maximum transitional period of 12 years. These time limits may exceptionally be extended by decision of the Cooperation Council. 5. No such measures can be introduced in respect of a product if more than three years have elapsed since the elimination of all duties and quantitative restrictions or charges or measures having an equivalent effect concerning that product. 6. South Africa shall notify the Cooperation Council of the exceptional measures it intends to take and, at the request of the Community, consultations shall be held on such measures before they are applied in order to reach a satisfactory solution. Its notification shall include an indicative schedule for the introduction and subsequent elimination of the customs duties to be imposed. 7. If no agreement on the proposed measures referred to in paragraph 6 has been reached within 30 days of such notification, South Africa may take the appropriate measures to remedy the problem and shall provide the Cooperation Council with the definite schedule for the elimination of the customs duties introduced under this Article. This schedule shall provide for a phasing out of these duties at equal annual rates starting at the latest one year after their introduction. The Cooperation Council may decide on a different schedule. Article 26 Safeguard procedures 1. In the event of the Community or South Africa initiating a surveillance mechanism in respect of difficulties referred to in Article 24 which has as its purpose the rapid provision of information on the trend of trade flows, it shall inform the other Party thereof and, if requested, enter into consultations with it. 2. In the cases specified in Article 24, before taking the measure provided for therein or, in cases to which subparagraph 5(b) of this Article apply, the Community or South Africa, as the case may be, shall as soon as possible supply the Cooperation Council with all relevant information, with the view to seeking a solution acceptable to both Parties. 3. In the selection of measures, priority must be given to those which least disturb the functioning of this Agreement and they shall be limited to the extent necessary to prevent or remedy serious injury and to facilitate adjustment. 4. The safeguard measures shall be notified immediately to the Cooperation Council and shall be the subject of periodic consultations within that body, particularly with a view to establishing a timetable for their abolition as soon as circumstances permit. 5. For the implementation of the previous paragraphs the following provisions shall apply. (a) As regards Article 24, difficulties arising from the situation referred to in that Article shall be referred for examination to the Cooperation Council, which may take any decision needed to put an end to such difficulties. If the Cooperation Council or the exporting Party has not taken a decision putting an end to the difficulties or no other satisfactory solution has been reached within 30 days of the matter being so referred, the importing Party may adopt appropriate measures to remedy the problem. Such measures should be taken for a period not exceeding three years and shall contain elements which would degressively lead to their elimination at the end of the set period, at the latest. (b) Where exceptional circumstances requiring immediate action make prior information or examination, as the case may be, impossible, the Community or South Africa, whichever is concerned, may, in the situations specified in Article 24, apply forthwith the precautionary measures necessary to deal with the situation and shall inform the other Party immediately thereof. Article 27 Exceptions The Agreement shall not preclude prohibitions or restrictions on imports, exports, goods in transit or trade in used goods justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of intellectual, industrial and commercial property or rules relating to gold and silver. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary or unjustifiable discrimination where the same conditions prevail or a disguised restriction on trade between the Parties. Article 28 Rules of origin The rules of origin for the application of tariff preferences provided for in this Agreement are laid down in Protocol 1. SECTION B RIGHT OF ESTABLISHMENT AND SUPPLY OF SERVICES Article 29 Reconfirmation of GATS obligations 1. In recognition of the growing importance of services for the development of their economies, the Parties underline the importance of strict observance of the General Agreement on Trade in Services (GATS), in particular its principle on most-favoured-nation treatment, and including its applicable protocols with annexed commitments. 2. In accordance with the GATS, this treatment shall not apply to: (a) advantages accorded by either Party under the provisions of an agreement as defined in Article V of the GATS or under measures adopted on the basis of such an agreement; (b) other advantages accorded pursuant to the list of most-favoured-nation exemptions annexed by either Party to the GATS. 3. The Parties reaffirm their respective commitments as annexed to the fourth Protocol to the GATS concerning basic telecoms and the fifth Protocol concerning financial services. Article 30 Further liberalisation of supply of services 1. The Parties will endeavour to extend the scope of the Agreement with a view to further liberalising trade in services between the Parties. In the event of such an extension, the liberalisation process shall provide for the absence or elimination of substantially all discrimination between the Parties in the services sectors covered and should cover all modes of supply including the supply of a service: (a) from the territory of one Party into the territory of the other; (b) in the territory of one Party to the service consumer of the other; (c) by a service supplier of one Party, through commercial presence in the territory of the other; (d) by a service supplier of one Party, through presence of natural persons of that Party in the territory of the other. 2. The Cooperation Council shall make the necessary recommendations for the implementation of the objective set out in paragraph 1. 3. When formulating these recommendations, the Cooperation Council shall take into account the experience gained by the implementation of the obligations of each Party under the GATS, with particular reference to Article V generally and especially paragraph 3(a) thereof covering the participation of developing countries in liberalisation agreements. 4. The objective set out in paragraph 1 shall be subject to a first examination by the Cooperation Council at the latest five years after the entry into force of this Agreement. Article 31 Maritime transport 1. The Parties shall endeavour to apply effectively the principle of unrestricted access to the international maritime market and traffic based on fair competition on a commercial basis. 2. The Parties agree to extend to each other's nationals and the vessels registered in the territory of either of the Parties treatment no less favourable than that granted to the most favoured nation in respect of the maritime transport of goods, passengers or both, access to ports, the use of infrastructure and auxiliary maritime services of those ports and related fees and charges, customs facilities and the assignment of berths and facilities for loading and unloading, based on fair competition and on commercial terms. 3. The Parties agree to consider maritime transport, including intermodal operations, in the context of Article 30, without prejudice to nationality restrictions or agreements entered into by either Party, which exist at that time and which would be consistent with the Parties' rights and obligations under the GATS Agreement. SECTION C CURRENT PAYMENTS AND MOVEMENT OF CAPITAL Article 32 Current payments 1. Subject to the provisions of Article 34, the Parties undertake to allow all payments for current transactions between residents of the Community and of South Africa to be made in freely convertible currency. 2. South Africa may take the necessary measures to ensure that the provisions of paragraph 1, which liberalise current payments, are not used by its residents to make unauthorised capital outflows. Article 33 Capital movements 1. With regard to transactions on the capital account of balance of payments, the Community and South Africa shall ensure, from the entry into force of this Agreement, that capital relating to direct investments in South Africa in companies formed in accordance with current laws can move freely, and that such investment and any profit stemming therefrom can be liquidated and repatriated. 2. The Parties shall consult each other with a view to facilitating and eventually achieving full liberalisation of the movement of capital between the Community and South Africa. Article 34 Balance of payment difficulties Where one or more Member States of the Community, or South Africa, is in serious balance of payments difficulties, or under threat thereof, the Community or South Africa, as the case may be, may, in accordance with the conditions established under the General Agreement on Tariffs and Trade and Articles VIII and XIV of the Articles of Agreement of the International Monetary Fund, adopt restrictions on current transactions which shall be of limited duration and may not go beyond what is necessary to remedy the balance of payments situation. The Community or South Africa, as the case may be, shall inform the other Party forthwith and shall submit to it as soon as possible a timetable for the elimination of the measures concerned. SECTION D COMPETITION POLICY Article 35 Definition The following are incompatible with the proper functioning of this Agreement, in so far as they may affect trade between the Community and South Africa: (a) agreements and concerted practices between firms in horizontal relationships, decisions by associations of firms, and agreements between firms in vertical relationships, which have the effect of substantially preventing or lessening competition in the territory of the Community or of South Africa, unless the firms can demonstrate that the anti-competitive effects are outweighed by pro-competitive ones; (b) abuse by one or more firms of market power in the territory of the Community or of South Africa as a whole or in a substantial part thereof. Article 36 Implementation If, at the entry into force of this Agreement, either Party has not yet adopted the necessary laws and regulations for the implementation of Article 35, in their jurisdictions it shall do so within a period of three years. Article 37 Appropriate measures If the Community or South Africa considers that a particular practice in its domestic market is incompatible with the terms of Article 35, and: (a) is not adequately dealt with under the implementing rules referred to in Article 36, or (b) in the absence of such rules, and if such practice causes or threatens to cause serious prejudice to the interests of the other Party or material injury to its domestic industry, including its services industry, the Party concerned may take appropriate measures consistent with its own laws, after consultation within the Cooperation Council, or after 30 working days following referral for such consultation. The appropriate measures to be taken shall respect the powers of the Competition Authority concerned. Article 38 Comity 1. The Parties agree that, whenever the Commission or the South African Competition Authority has reason to believe that anti-competitive practices, defined under Article 35, are taking place within the territory of the other authority and are substantially affecting important interests of the Parties, it may request the other Party's competition authority to take appropriate remedial action in terms of that authority's rules governing competition. 2. Such a request shall not prejudice any action under the requesting authority's competition laws that may be deemed necessary and shall not in any way encumber the addressed authority's decision-making powers or its independence. 3. Without prejudice to its respective functions, rights, obligations or independence, the competition authority so addressed shall consider and give careful attention to the views expressed and documentation provided by the requesting authority and, in particular, pay heed to the nature of the anti-competitive activities in question, the firm or firms involved, and the alleged harmful effect on the important interests of the aggrieved Party. 4. When the Commission or the Competition Authority of South Africa decides to conduct an investigation or intends to take any action that may have important implications for the interests of the other Party, the Parties must consult, at the request of either Party and both shall endeavour to find a mutually acceptable solution in the light of their respective important interests, giving due regard to each other's laws, sovereignty, the independence of the respective competition authorities and to considerations of comity. Article 39 Technical assistance The Community shall provide South Africa with technical assistance in the restructuring of its competition law and policy, which may include among others: (a) the exchange of experts; (b) organisation of seminars; (c) training activities. Article 40 Information The Parties shall exchange information taking into account the limitations imposed by the requirements of professional and business secrecy. SECTION E PUBLIC AID Article 41 Public aid 1. In so far as it may affect trade between the Community and South Africa, public aid favouring certain firms or the production of certain goods, which distorts or threatens to distort competition, and which does not support a specific public policy objective or objectives of either Party, is incompatible with the proper functioning of this Agreement. 2. The Parties agree that it is in their interests to ensure that public aid is granted in a fair, equitable and transparent manner. Article 42 Remedial measures 1. If the Community or South Africa considers that a particular practice is incompatible with the terms of Article 41, and that such practice causes or threatens to cause serious prejudice to the interests of the other Party or material injury to its domestic industry, the Parties agree, where it is not adequately dealt with under existing rules and procedures, to enter into consultations with a view to finding a mutually satisfactory solution. Such consultations will be without prejudice to the Parties' rights and obligations in terms of their respective laws and international commitments. 2. Either Party may invite the Cooperation Council to examine, in the context of such consultation, the Parties' public policy objectives justifying the grant of public aid referred to in Article 41. Article 43 Transparency Each Party shall ensure transparency in the area of public aid. In particular, where a Party so requests, the other Party shall provide information on aid schemes, on particular individual cases of public aid, or on the total amount and the distribution of aid given. The exchange of information between the Parties shall take into account the limitations imposed by either Party's laws relating to the requirements of business and professional secrecy. Article 44 Review 1. In the absence of any rules or procedures for the implementation of Article 41, the provisions of Article VI and XVI of the General Agreement on Tariffs and Trade 1994 as well as the WTO Agreement on Subsidies and Countervailing Measures shall apply to public aid or subsidies. 2. The Cooperation Council shall periodically review the progress made in these matters. In particular it shall continue to develop cooperation and understanding on the measures taken by each Party with regard to the operation of Article 41. SECTION F OTHER TRADE-RELATED PROVISIONS Article 45 Government procurement 1. The Parties agree to cooperate to ensure that access to the Parties' procurement contracts is governed by a system which is fair, equitable and transparent. 2. The Cooperation Council shall periodically review the progress made in this matter. Article 46 Intellectual property 1. The Parties shall ensure ade …