This law is an interim agreement between the European Community and the Palestine Liberation Organization (for the…

21997A0716(01) 21997A0716(01) Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part - Protocol 1 on the arrangements applying to imports into the Community of agricultural products originating in the West Bank and the Gaza Strip - Protocol 2 on the arrangements applying to imports into the West Bank and the Gaza Strip of agricultural products originating in the Community - Protocol 3 concerning the definition of the concept of 'originating products' and methods of administrative cooperation - Final Act - Joint Declarations - Declaration by the European Community Official Journal L 187 , 16/07/1997 p. 0003 - 0135 Dates:

OF DOCUMENT: 02/06/1997 OF EFFECT: 01/07/1997; ENTRY INTO FORCE SEE ART 75 AND OJ L 187/97 P. 136 OF SIGNATURE: 24/02/1997; BRUSSELS OF 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 ; ARABIC Author:

EUROPEAN COMMUNITY Subject matter: EXTERNAL RELATIONS ; ASSOCIATION ; COMMERCIAL POLICY ; DEVELOPMENT COOPERATION Directory code: 11402000 ; 11704000 EUROVOC descriptor: association agreement ; cooperation agreement ; trade agreement ; European Community ; EC interim agreement ; PLO Legal basis:

192E113................... ADOPTION 192E130Y.................. ADOPTION 192E228-P2F1.............. ADOPTION 192E228-P3L2.............. ADOPTION Instruments cited:

391R1911..................

192E042...................

192E043...................

362R0026..................

157EN02...................

279A0412(07)..............

294A1223(01)..............

Amended by:

ADOPTED-BY.... 397D0430..........

EURO-MEDITERRANEAN INTERIM ASSOCIATION AGREEMENT on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part The EUROPEAN COMMUNITY, hereinafter referred to as 'the Community`, of the one part, and the PALESTINE LIBERATION ORGANIZATION (PLO) FOR THE BENEFIT OF THE PALESTINIAN AUTHORITY OF THE WEST BANK AND THE GAZA STRIP, hereinafter referred to as 'the Palestinian Authority`, of the other part, CONSIDERING the importance of the existing links between the Community and the Palestinian people of the West Bank and the Gaza Strip, and the common values that they share, CONSIDERING that the Community and the PLO wish to strengthen those links and to establish lasting relations based on partnership and reciprocity, CONSIDERING the importance which the Parties attach to the principles of the United Nations Charter, particularly the observance of human rights, democratic principles and political and economic freedoms which form the very basis of their relations, DESIROUS of strengthening the framework of relations between the European Community and the Middle East, and of regional economic integration of the Middle Eastern countries as an objective to be achieved as soon as conditions permit, CONSIDERING the difference in economic and social development existing between the Parties and the need to intensify existing efforts to promote economic and social development in the West Bank and the Gaza Strip, DESIROUS of establishing a cooperation, supported by a regular dialogue, on economic, cultural, scientific and educational matters with a view to improving mutual knowledge and understanding, CONSIDERING the commitment of the Parties to free trade, and in particular to compliance with the provisions of the General Agreement on Tariffs and Trade of 1994, DESIROUS of building on the existing autonomous trade arrangements between the Parties and placing them on a contractual and reciprocal basis, CONVINCED of the need to promote the creation of a new climate for their economic relations in order to improve the environment for investment flows, CONSIDERING the rights and obligations of the parties under the international agreements which they have signed, CONVINCED that the full participation of the Palestinian Authority in the Euro-Mediterranean Partnership launched at the Barcelona Conference is an important step in the normalization of relations between the Parties, which should be reflected in an Agreement on an

interim basis at the present stage, AWARE of the major political significance of the holding of Palestinian elections on 20 January 1996 for the process leading to a permanent settlement based on United Nations Security Council Resolutions 242 and 338, RECOGNIZING that this Agreement should be replaced by a Euro-Mediterranean Association Agreement as soon as conditions permit, HAVE AGREED AS FOLLOWS:

Article 11. An Interim Association on Trade and Cooperation is hereby

established between the Community and the Palestinian Authority.

Article 2Relations between the Parties, as well as all the provisions of the

Agreement itself, shall be based on respect of democratic principles and fundamental human rights as set out in the universal declaration on human rights, which guides their internal and international policy and constitutes an essential element of this Agreement.

TITLE I FREE MOVEMENT OF GOODS

BASIC PRINCIPLES

Article 3The Community and the Palestinian Authority shall establish

progressively a free trade area over a transitional period, not extending beyond 31 December 2001, according to the modalities set out in this Title and in conformity with the provisions of the General Agreement on Tariffs and Trade of 1994 and of the other multilateral agreements on trade in goods annexed to the agreement establishing the World Trade Organization (WTO), hereinafter referred to as the GATT.

CHAPTER 1 INDUSTRIAL PRODUCTS

Article 4The provisions of this Chapter shall apply to products originating

in the Community and in the West Bank and the Gaza Strip other than those listed in Annex II to the Treaty establishing the European Community.

Article 5No new customs duty on imports, or any other charge having

equivalent effect, shall be introduced on trade between the Community and the West Bank and Gaza Strip.

Article 6Imports into the Community of products originating in the West Bank

and the Gaza Strip shall be allowed free of customs duties and of any other charge having equivalent effect and free of quantitative restrictions and of any other measure having equivalent effect.

Article 71. The provisions of this Chapter do not preclude the retention by

the Community of an agricultural component in respect of goods originating in the West Bank and the Gaza Strip and listed in Annex 1.

The provisions of Chapter 2 applicable to agricultural products shall apply mutatis mutandis to the agricultural component.

Article 81. Customs duties and charges having equivalent effect applicable on

import into the West Bank and the Gaza Strip of products originating in the Community, other than those listed in Annexes 2 and 3, shall be abolished when the Agreement enters into force.

Article 9The provisions concerning the abolition of customs duties on imports

shall also apply to customs duties of a fiscal nature.

Article 101. By way of derogation from Articles 5 and 8, the Palestinian

Authority may take exceptional measures of limited duration to introduce, increase or re-introduce customs duties.

CHAPTER 2 AGRICULTURAL AND FISHERY PRODUCTS

Article 11The provisions of this Chapter shall apply to products originating

in the Community and the West Bank and the Gaza Strip and listed in Annex II to the Treaty establishing the European Community.

Article 12The Community and the Palestinian Authority shall progressively

establish a greater liberalization of their trade in agricultural and fishery products of interest to both Parties.

Article 131. Agricultural products originating in the West Bank and the Gaza

Strip listed in Protocol 1 on importation into the Community shall be subject to the arrangements set out in that Protocol.

Article 141. From 1 January 1999, the Community and the Palestinian Authority

shall examine the situation in order to determine the measures to be applied by the Community and the Palestinian Authority from 1 January 2000, in accordance with the objective set out in Article 12.

CHAPTER 3 COMMON PROVISIONS

Article 151. No new quantitative restriction on imports or measures having

equivalent effect shall be introduced in trade between the Community and the West Bank and Gaza Strip.

Article 161. Products originating in the West Bank and the Gaza Strip shall

not, on importation into the Community, be accorded a treatment more favourable than that which the Member States apply among themselves.

Article 171. In the event of specific rules being introduced as a result of

the implementation of its agricultural policy or of any alteration of the current rules or in the event of any alteration or extension of the provisions relating to the implementation of its agricultural policy, the Party concerned may amend the arrangements resulting from the Agreement in respect of the products concerned.

Article 181. 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 like products originating in the territory of the other Party.

Article 191. The Agreement shall not preclude the maintenance or establishment

of customs unions, free trade areas or arrangements for frontier trade, except insofar as they alter the trade arrangements provided for in this Agreement.

Article 20If one of the Parties finds that dumping is taking place in trade

with the other Party within the meaning of Article VI of GATT, it may take appropriate measures against this practice in accordance with the Agreement on implementation of Article VI of the GATT and with its relevant internal legislation, under the conditions and in accordance with the procedures laid down in Article 23 of this Agreement.

Article 21Where any product is being imported in such increased quantities and

under such conditions as to cause or threaten to cause:

Article 23

Article 22Where compliance with the provisions of Article 15 (3) leads to:

(i) re-export towards a third country against which the exporting Party maintains, for the product concerned, quantitative export restrictions, export duties, or measures having equivalent effect, or (ii) a serious shortage, or threat thereof, of a product essential to the exporting Party; and where the situations referred to above give rise, or are likely to give rise to major difficulties for the exporting Party, that Party may take appropriate measures under the conditions and in accordance with the procedures laid down in Article 23. The measures shall be non-discriminatory and be eliminated when conditions no longer justify their maintenance.

Article 231. In the event of the Community or the Palestinian Authority

subjecting imports of products liable to give rise to the difficulties referred to in Article 21 to an administrative procedure, the purpose of which is to provide rapid information on the trend of trade flows, it shall inform the other Party.

In the selection of appropriate measures, priority must be given to those which least disturb the functioning of the Agreement.

The safeguard measures shall be notified immediately to the Joint Committee and shall be the subject of periodic consultations within that Committee, particularly with a view to their abolition as soon as circumstances permit.

If the Joint Committee 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 referred, the importing Party may adopt the appropriate measures to remedy the problem. These measures shall not exceed the scope of what is necessary to remedy the difficulties which have arisen. (c) As regards Article 22, the difficulties arising from the situations referred to in that Article shall be referred for examination to the Joint Committee.

The Committee may take any decision needed to put an end to the difficulties. If it has not taken such a decision within 30 days of the matter being referred to it, the exporting Party may apply appropriate measures on the exportation of the product concerned. (d) Where exceptional circumstances requiring immediate action make prior information or examination, as the case may be, impossible, the Party concerned may, in the situations specified in Articles 20, 21 and 22 apply forthwith such precautionary measures as are strictly necessary to remedy the situation, and shall inform the other Party immediately.

Article 24Nothing in this Agreement shall preclude prohibitions or

restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security, of the protection of health and life of humans, animals or plants, of the protection of national treasures possessing artistic, historic or archaeological value, of the protection of intellectual, industrial and commercial property or of regulations concerning gold and silver. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between the Parties.

Article 25The concept of 'originating products` for the application of the

provisions of the present Title and the methods of administrative cooperation relating to them are set out in Protocol 3. The Joint Committee may decide to make the necessary adaptations to this Protocol with a view to the implementation of cumulation of origin as agreed in the Declaration adopted at the Barcelona Conference.

Article 26The combined nomenclature shall be used for the classification of

goods in the trade between the Parties.

TITLE II PAYMENTS, CAPITAL, COMPETITION, INTELLECTUAL PROPERTY AND

PUBLIC PROCUREMENT

CHAPTER 1 CURRENT PAYMENTS AND MOVEMENT OF CAPITAL

Article 27Subject to the provisions of Article 29, the Parties undertake to

impose no restrictions on any current payments for current transactions.

Article 281. With regard to transactions on the capital account of balance of

payments, the Parties undertake to impose no restrictions on the movement of capital relating to direct investments in the West Bank and Gaza Strip in companies formed in accordance with current laws, nor on the liquidation and repatriation of the yield from such investments, or any profit stemming therefrom.

Article 29Where one or more Member States of the Community, or the Palestinian

Authority, is in serious balance of payments difficulties, or under threat thereof, the Community or the Palestinian Authority, as the case may be, may, in accordance with the conditions established under the GATT 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 the Palestinian Authority, 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.

CHAPTER 2 COMPETITION, INTELLECTUAL PROPERTY AND PUBLIC PROCUREMENT

Article 301. The following are incompatible with the proper functioning of the

Agreement, insofar as they may affect trade between the Community and the Palestinian Authority: (i) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition; (ii) abuse by one or more undertakings of a dominant position in the territories of the Community or the West Bank and the Gaza Strip as a whole or in a substantial part thereof; (iii) any public aid which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods.

Until these rules are adopted, the provisions of the Agreement on Subsidies and Countervailing Measures shall be applied as the rules for the implementation of paragraph 1 (iii) and the relevant parts of paragraph 2.

With reference to practices incompatible with paragraph 1 (iii) of this Article, such appropriate measures, when the GATT is applicable to them, may only be adopted in accordance with the procedures and under the conditions laid down by GATT or by any other relevant instrument negotiated under its auspices and applicable between the Parties.

Article 31The Member States and the Palestinian Authority shall progressively

adjust, without prejudice to their commitments to the GATT where appropriate, any State monopolies of a commercial character, so as to ensure that, by 31 December 2001, no discrimination regarding the conditions under which goods are procured and marketed exists between nationals of the Member States and the Palestinian people of the West Bank and Gaza Strip. The Joint Committee will be informed about the measures adopted to implement this objective.

Article 32With regard to public enterprises and enterprises to which special

or exclusive rights have been granted, the Joint Committee shall ensure that by 31 December 2001 there is neither enacted nor maintained any measure distorting trade between the Community and the Palestinian Authority contrary to the Parties' interests. This provision should not obstruct the performance in law or in fact of the particular tasks assigned to those undertakings.

Article 331. The Parties shall grant and ensure adequate and effective

protection of intellectual, industrial and commercial property rights in accordance with the highest international standards, including effective means of enforcing such rights.

Article 341. The Parties agree on the objective of reciprocal and gradual

liberalization of public procurement contracts.

TITLE III ECONOMIC COOPERATION AND SOCIAL DEVELOPMENT

Article 35Objectives

Article 36Scope

Article 37Methods and modalities

Economic cooperation shall be implemented in particular by: (a) a regular economic dialogue between the Parties, which covers all areas of macro-economic policy and in particular budgetary policy, the balance of payments and monetary policy; (b) regular exchange of information and ideas in every sector of cooperation including meetings of officials and experts; (c) transfer of advice, expertise and training; (d) implementation of joint actions such as seminars and workshops; (e) technical, administrative and regulatory assistance; (f) encouragement of joint ventures; (g) dissemination of information on cooperation.

Article 38Industrial cooperation

The main aim will be to:

Article 39Investment promotion and investment

The objective of cooperation will be the creation of a favourable and stable environment for investment in the West Bank and Gaza Strip.

Cooperation will take the form of promotion of investment. This will entail the development of:

Cooperation may also extend to the conception and implementation of projects demonstrating the effective acquisition and use of basic technologies, the use of standards, the development of human resources (e.g. in technologies and management) and the creation of jobs.

Article 40Standardization and conformity assessment

The objective of cooperation will be to narrow the gap in standards and certification.

In practical terms cooperation will take the form of:

Article 41Approximation of laws

The objective of cooperation will be to approximate Palestinian Council legislation to that of the Community, in the areas covered by the Agreement.

Article 42Small and medium-sized enterprises

The objective of cooperation will be the creation of an environment propitious to the development of SMEs on local and export markets through, inter alia:

Article 43Financial services

The objective of cooperation will be the improvement and development of financial services.

It will take the form of:

Article 44Agriculture and fisheries

The objective of cooperation under this heading will mainly be the modernization and restructuring, where necessary, of agriculture and fisheries.

This includes modernization of infrastructures and of equipment; the development of packaging, storage and marketing techniques; and the improvement of distribution channels.

It will be geared more especially to:

Article 45Social development

The Parties acknowledge the importance of social development which should go hand-in-hand with any economic development. They give particular priority to respect for basic social rights.

The Parties will give priority to measures aimed at:

Article 46Transport

The objectives of cooperation will be:

The priority areas of cooperation will be:

Article 47Information infrastructure and telecommunications

Cooperation shall aim at stimulating economic and social development as well as developing an information society.

The priority areas of cooperation will be:

Article 48Energy

The objective of cooperation on energy will be to help the West Bank and Gaza Strip acquire the technologies and infrastructures essential to its development, particularly with a view to facilitating links between its economy and that of the Community.

The priority areas of cooperation will be:

Article 49Scientific and technological cooperation

The Parties will endeavour to promote cooperation on scientific and technological development.

The aim of cooperation shall be to: (a) encourage the establishment of permanent links between the Parties' scientific communities, notably by means of:

Article 50Environment

The objectives of cooperation will be to prevent deterioration of the environment, to control pollution, to protect human health and to ensure the rational use of natural resources with a view to promoting sustainable development.

It will place priority on matters relating to: desertification, water resource management, salinization, the impact of agriculture on soil and water quality, the appropriate use of energy, the impact of industrial development in general and the safety of industrial plant in particular, waste management, the integrated management of sensitive areas, the quality of sea water and the control and prevention of marine pollution, and environmental education and awareness.

Cooperation shall be fostered by the use of advanced tools of environmental management, environmental monitoring methods, and surveillance, including the use of environmental information systems (EIS) and environmental impact assessment (EIA).

Article 51Tourism

Priorities for cooperation shall be:

Article 52Customs cooperation

Customs cooperation is intended to ensure that the provisions on trade are observed and to guarantee fair trading.

It could give rise to the following types of cooperation:

Without prejudice to other forms of cooperation provided for in this Agreement, the administrative authorities of the Parties will provide each other with mutual assistance on customs matters.

Article 53Cooperation on statistics

The main objective of cooperation in this domain should aim to ensure the comparability and usefulness of statistics on foreign trade, finance and balance of payments, population, migration, transport and communications, and generally all the fields which are covered by this Agreement and lend themselves to the establishment of statistics.

Article 54Cooperation on economic policy

Cooperation is aimed at:

Article 55Regional cooperation

As part of the implementation of economic cooperation in the various spheres, the Parties will encourage operations designed to develop cooperation between the Palestinian Authority and other Mediterranean partners, through technical support.

This cooperation will be an important element of the Community's support for the development of the region as a whole.

Priority will be given to operations aimed at:

In addition the Parties will strengthen cooperation between them on regional development and land-use planning.

To this end the following measures may be taken:

TITLE IV COOPERATION ON AUDIO-VISUAL AND CULTURAL MATTERS,

INFORMATION AND COMMUNICATION

Article 56The Parties shall promote cooperation in the audio-visual sector to

their mutual benefit. The Parties shall seek ways of associating the Palestinian Authority with Community initiatives in this sector, thus enabling cooperation in areas such as co-production, training, development and distribution.

Article 57The Parties shall promote cultural cooperation. The area of

cooperation may include Community activities concerning, in particular, translation, exchange of works of art and artists, conservation and restoration of historic and cultural monuments and sites, training of persons working in the cultural field, the organization of European-oriented cultural events, raising mutual awareness and contributing to the dissemination of information on outstanding cultural events.

Article 58The Parties will undertake to determine how to improve significantly

the education and vocational training situation. To this end, the access of women to education, including technical courses, higher education and vocational training, will receive special attention.

In order to develop the level of expertise of senior staff in the public and private sectors, the Parties will step up their cooperation on education and vocational training and cooperation between universities and firms.

Preparing young people to become active citizens in democratic civil society should be actively promoted. Youth cooperation, including training of youth workers and youth leaders, youth exchanges and voluntary service activities, could therefore be supported and developed.

Special attention will be paid to operations and programmes which will enable permanent links (MED-CAMPUS, for instance) to be established between specialized bodies in the Community and in the West Bank and Gaza Strip, such as will encourage the pooling and exchange of experience and technical resources.

Article 59The Parties shall promote activities of mutual interest in the field

of information and communication.

Article 60Cooperation shall be implemented in particular through:

(a) a regular dialogue between the Parties; (b) regular exchange of information and ideas in every sector of cooperation including meetings of officials and experts; (c) transfer of advice and experience and training of young Palestinian graduates; (d) implementation of joint actions such as seminars and workshops; (e) technical, administrative and regulatory assistance; (f) the dissemination of information on cooperation activities.

TITLE V FINANCIAL COOPERATION

Article 61In order to achieve the objectives of this Agreement, a financial

cooperation package shall be made available to the Palestinian Authority in accordance with the appropriate procedures and the financial resources required.

These procedures shall be agreed by both Parties using the most appropriate instruments after this Agreement has entered into force.

Financial cooperation shall focus on:

Article 62In order to ensure that a coordinated approach is adopted to any

exceptional macro-economic and financial problems that might arise as a result of the implementation of this Agreement, the Parties shall use the regular economic dialogue provided for in Title III to give particular attention to monitoring trade and financial flows in relations between them.

TITLE VI INSTITUTIONAL, GENERAL AND FINAL PROVISIONS

Article 631. A Joint Committee for European Community-Palestinian Authority

trade and cooperation, referred to in this Agreement as 'the Joint Committee`, is hereby established. It shall have the power to take decisions in the cases provided for in the Agreement as well as in other cases necessary for the purpose of attaining the objectives set out in the Agreement.

The decisions taken shall be binding on the Parties, which shall take such measures as are required to implement them.

Article 641. The Joint Committee shall be composed of representatives of the

Community and of the Palestinian Authority.

Article 651. The office of Chairman of the Joint Committee shall be held

alternately by the Community and the Palestinian Authority in accordance with the conditions laid down in the rules of procedure.

Article 661. The Joint Committee may decide to set up any other committee that

can assist it in carrying out its duties.

Article 671. Either Party may refer to the Joint Committee any dispute

relating to the application or interpretation of this Agreement.

The Joint Committee shall appoint a third arbitrator.

The arbitrators' decisions shall be taken by majority vote.

Each Party to the dispute must take the steps required to implement the decision of the arbitrator.

Article 68Nothing in the Agreement shall prevent a Party from taking any

measures: (a) which it considers necessary to prevent the disclosure of information contrary to its essential security interests; (b) which relate to the production of, or trade in, arms, munitions or war materials or to research, development or production indispensable for defence purposes, provided that such measures do not impair the conditions of competition in respect of products not intended for specifically military purposes; (c) which it considers essential to its own security in the event of serious internal disturbances affecting the maintenance of law and order, in time of war or serious international tension constituting threat of war, or in order to carry out obligations it has accepted for the purpose of maintaining peace and international security.

Article 69In the fields covered by this Agreement and without prejudice to any

special provisions contained therein:

Article 701. The Parties shall take any general or specific measures required

to fulfil their obligations under the Agreement. They shall see to it that the objectives set out in the Agreement are attained.

In the selection of measures, priority must be given to those which least disturb the functioning of the Agreement. These measures shall be notified immediately to the Joint Committee and shall be the subject of consultations within the Joint Committee if the other Party so requests.

Article 71Annexes 1 to 3 and Protocols 1 to 3 shall form an integral part of

this Agreement.

Declarations shall appear in the Final Act, which shall form an integral part of this Agreement.

Article 72For the purpose of this Agreement the term 'Parties` shall mean the

PLO for the benefit of the Palestinian Authority and the Community, which shall each act in accordance with their respective powers.

Article 73This Agreement shall apply, on the one hand, to the territories in

which the Treaty establishing the European Community is applied and under the conditions laid down in that Treaty and, on the other hand, to the territory of the West Bank and the Gaza Strip.

Article 74

This Agreement, drawn up in duplicate in the Danish, Dutch, English, Finnish, French, German, Greek, Italian, Portuguese, Spanish, Swedish, and Arabic languages, each of these texts being equally authentic, shall be deposited with the General Secretariat of the Council of the European Union.

Article 751. This Agreement will be approved by the Parties in accordance with

their own procedures.

This Agreement shall enter into force on the first day of the month following the date on which the Parties notify each other that the procedures referred to in the first paragraph have been completed.

Hecho en Bruselas, el veinticuatro de febrero de mil novecientos noventa y siete.

Udfördiget i Bruxelles den fireogtyvende februar nitten hundrede og syv og halvfems.

Geschehen zu BrŽssel am vierundzwanzigsten Februar neunzehnhundertsiebenundneunzig. øółżõ ėĮłĖ ĀęįžąūūõĖ, ėĮłĖ õčś˙ėł ĮąėėõęłĖ Öõņę˙įńęč˙į ščūłń õżżłńśŽėłń õżõżČżĮń õĘĮĄ.

Done at Brussels on the twenty-fourth day of February in the year one thousand nine hundred and ninety-seven.

Fait š Bruxelles, le vingt-quatre fłvrier mil neuf cent quatre-vingt-dix-sept.

Fatto a Bruxelles, addü ventiquattro febbraio millenovecentonovantasette.

Gedaan te Brussel, de vierentwintigste februari negentienhonderd zevenennegentig.

Feito em Bruxelas, em vinte e quatro de Fevereiro de mil novecentos e noventa e sete.

Tehty Brysselissō kahdentenakymmenentenōneljōntenō pōivōnō helmikuuta vuonna tuhatyhdeksōnsataayhdeksōnkymmentōseitsemōn.

Som skedde i Bryssel den tjugofjōrde februari nittonhundranittiosju. >REFERENCE TO A GRAPHIC> Por la Comunidad Europea For Det Europöiske Föllesskab FŽr die Europōische Gemeinschaft Ćłń Į÷ż ÅįęųĘńŪśČ Ź˙łżŽĮ÷Įń For the European Community Pour la Communautł europłenne Per la Comunitš europea Voor de Europese Gemeenschap Pela Comunidade Europeia Euroopan yhteisŠn puolesta Põ Europeiska gemenskapens vōgnar >REFERENCE TO A GRAPHIC> >REFERENCE TO A GRAPHIC> ANNEX 1 >TABLE POSITION> ANNEX 2 >TABLE POSITION> ANNEX 3 >TABLE POSITION> PROTOCOL 1 on the arrangements applying to imports into the Community of agricultural products originating in the West Bank and the Gaza Strip

Article 11. The products listed in the Annex, originating in the West Bank

and the Gaza Strip, shall be admitted for import into the Community in accordance with the conditions set out below and in the Annex.

Where the Common Customs Tariff provides for the application of ad valorem customs duties and a specific customs duty in respect of certain products, the rates of reduction shown in column A and in column C, as referred to in paragraph 3, shall apply only to the ad valorem customs duty.

The Common Customs Tariff duties in respect of the quantities imported in excess of the quotas shall be reduced by the percentage indicated in column C.

Where imports of a product exceed the reference quantities, the Community may, having regard to an annual review of trade flows which it shall carry out, make the product concerned subject to a Community tariff quota the volume of which shall be equal to the reference quantity. In such a case, for quantities imported in excess of the quota, the common customs tariff duty shall, according to the product concerned, be applied in full or reduced, as indicated in column C.

ANNEX TO PROTOCOL 1 >TABLE POSITION> PROTOCOL 2 on the arrangements applying to imports into the West Bank and the Gaza Strip of agricultural products originating in the Community 1. The products listed in the Annex originating in the Community shall be admitted for importation into the West Bank and the Gaza strip according to the conditions contained herein and in the Annex.

ANNEX TO PROTOCOL 2 >TABLE POSITION> PROTOCOL 3 concerning the definition of the concept of 'originating products` and methods of administrative cooperation TABLE OF CONTENTS

TITLE I GENERAL PROVISIONS

Article 1Definitions

TITLE II DEFINITION OF THE CONCEPT OF 'ORIGINATING PRODUCTS`

Article 2General requirements

Article 3Bilateral cumulation of origin

Article 4Wholly obtained products

Article 5Sufficiently worked or processed products

Article 6Insufficient working or processing operations

Article 7Unit of qualification

Article 8Accessories, spare parts and tools

Article 9Sets

Article 10Neutral elements

TITLE III TERRITORIAL REQUIREMENTS

Article 11Principle of territoriality

Article 12Direct transport

Article 13Exhibitions

TITLE IV DRAWBACK OR EXEMPTION

Article 14Prohibition of drawback of, or exemption from, customs

duties

TITLE V PROOF OF ORIGIN

Article 15General requirements

Article 16Procedure for the issue of a movement certificate EUR.1

Article 17Movement certificates EUR.1 issued retrospectively

Article 18Issue of a duplicate movement certificate EUR.1

Article 19Issue of movement certificates EUR.1 on the basis of a

proof of origin issued or made out previously

Article 20Conditions for making out an invoice declaration

Article 21Approved exporter

Article 22Validity of proof of origin

Article 23Submission of proof of origin

Article 24Importation by instalments

Article 25Exemptions from proof of origin

Article 26Supporting documents

Article 27Preservation of proof of origin and supporting documents

Article 28Discrepancies and formal errors

Article 29Amounts expressed in ecu

TITLE VI ARRANGEMENTS FOR ADMINISTRATIVE COOPERATION

Article 30Mutual assistance

Article 31Verification of proofs of origin

Article 32Dispute settlement

Article 33Penalties

Article 34Free zones

TITLE VII CEUTA AND MELILLA

Article 35Application of the Protocol

Article 36Special conditions

TITLE VIII FINAL PROVISIONS

Article 37Amendments to the Protocol

Article 38Implementation of the Protocol

Article 39Goods in transit or in storage

ANNEXES Annex I Introductory notes to the list in Annex II Annex II List of working or processing required to be carried out on non-originating materials in order that the product manufactured can obtain originating status Annex III Movement certificate EUR.1 and application for a movement certificate EUR.1 Annex IV Invoice declaration

TITLE I GENERAL PROVISIONS

Article 1Definitions

For the purposes of this Protocol: (a) 'manufacture` means any kind of working or processing including assembly or specific operations; (b) 'material` means any ingredient, raw material, component or part, etc., used in the manufacture of the product; (c) 'product` means the product being manufactured, even if it is intended for later use in another manufacturing operation; (d) 'goods` means both materials and products; (e) 'customs value` means the value as determined in accordance with the 1994 Agreement on implementation of Article VII of the General Agreement on Tariffs and Trade (WTO Agreement on customs valuation); (f) 'ex-works price` means the price paid for the product ex works to the manufacturer in the Community or the West Bank and Gaza Strip in whose undertaking the last working or processing is carried out, provided the price includes the value of all the materials used, minus any internal taxes which are, or may be, repaid when the product obtained is exported; (g) 'value of materials` means the customs value at the time of importation of the non-originating materials used, or, if this is not known and cannot be ascertained, the first ascertainable price paid for the materials in the Community or the West Bank and Gaza Strip; (h) 'value of originating materials` means the value of such materials as defined in subparagraph (g) applied mutatis mutandis; (i) 'added value` shall be taken to be the ex-works price minus the customs value of each of the products incorporated which did not originate in the country in which those products were obtained; (j) 'chapters` and 'headings` mean the chapters and the headings (four-digit codes) used in the nomenclature which makes up the Harmonized Community Description and Coding System, referred to in this Protocol as 'the Harmonized System` or 'HS`; (k) 'classified` refers to the classification of a product or material under a particular heading; (l) 'consignment` means products which are either sent simultaneously from one exporter to one consignee or covered by a single transport document covering their shipment from the exporter to the consignee or, in the absence of such a document, by a single invoice; (m) 'territories` includes territorial waters.

TITLE II DEFINITION OF THE CONCEPT OF 'ORIGINATING PRODUCTS`

Article 2General requirements

Article 3Bilateral cumulation of origin

Article 4Wholly obtained products

Article 5Sufficiently worked or processed products

The conditions referred to above indicate, for all products covered by this Agreement, the working or processing which must be carried out on non-originating materials used in manufacturing and apply only in relation to such materials. Accordingly, it follows that if a product, which has acquired originating status by fulfilling the conditions set out in the list is used in the manufacture of another product, the conditions applicable to the product in which it is incorporated do not apply to it, and no account shall be taken of the non-originating materials which may have been used in its manufacture.

This paragraph shall not apply to products falling within Chapters 50 to 63 of the Harmonized System.

Article 6Insufficient working or processing operations

Article 7Unit of qualification

Accordingly, it follows that: (a) when a product composed of a group or assembly of articles is classified under the terms of the Harmonized System in a single heading, the whole constitutes the unit of qualification; (b) when a consignment consists of a number of identical products classified under the same heading of the Harmonized System, each product must be taken individually when applying the provisions of this Protocol.

Article 8Accessories, spare parts and tools

Accessories, spare parts and tools dispatched with a piece of equipment, machine, apparatus or vehicle, which are part of the normal equipment and included in the price thereof or which are not separately invoiced, shall be regarded as one with the piece of equipment, machine, apparatus or vehicle in question.

Article 9Sets

Sets, as defined in General Rule 3 of the Harmonized System, shall be regarded as originating when all component products are originating. Nevertheless, when a set is composed of originating and non-originating products, the set as a whole shall be regarded as originating, provided that the value of the non-originating products does not exceed 15 % of the ex-works price of the set.

Article 10Neutral elements

In order to determine whether a product originates, it shall not be necessary to determine the origin of the following which might be used in its manufacture: (a) energy and fuel; (b) plant and equipment; (c) machines and tools; (d) goods which do not enter and which are not intended to enter into the final composition of the product.

TITLE III TERRITORIAL REQUIREMENTS

Article 11Principle of territoriality

Article 12Direct transport

Originating products may be transported by pipeline across territory other than that of the Community or the West Bank and Gaza Strip.

Article 13Exhibitions

TITLE IV DRAWBACK OR EXEMPTION

Article 14Prohibition of drawback of, or exemption from, customs

duties 1. Non-originating materials used in the manufacture of products originating in the Community or in the West Bank and Gaza Strip for which a proof of origin is issued or made out in accordance with the provisions of Title V shall not be subject in the Community or the West Bank and Gaza Strip to drawback of, or exemption from, customs duties of whatever kind.

Furthermore, they shall not preclude the application of an export refund system for agricultural products, applicable upon export in accordance with the provisions of the Agreement.

TITLE V PROOF OF ORIGIN

Article 15General requirements

Article 16Procedure for the issue of a movement certificate EUR.1

Article 17Movement certificates EUR.1 issued retrospectively

Article 18Issue of a duplicate movement certificate EUR.1

Article 19Issue of movement certificates EUR.1 on the basis of a

proof of origin issued or made out previously When originating products are placed under the control of a customs office in the Community or the West Bank and Gaza Strip, it shall be possible to replace the original proof of origin by one or more movement certificates EUR.1 for the purpose of sending all or some of these products elsewhere within the Community or the West Bank and Gaza Strip. The replacement movement certificate(s) EUR.1 shall be issued by the customs office under whose control the products are placed.

Article 20Conditions for making out an invoice declaration

Article 21Approved exporter

Article 22Validity of proof of origin

Article 23Submission of proof of origin

Proofs of origin shall be submitted to the customs authorities of the importing country in accordance with the procedures applicable in that country. The said authorities may require a translation of a proof of origin and may also require the import declaration to be accompanied by a statement from the importer to the effect that the products meet the conditions required for the implementation of the Agreement.

Article 24Importation by instalments

Where, at the request of the importer and on the conditions laid down by the customs authorities of the importing country, dismantled or non-assembled products within the meaning of General Rule 2 (a) of the Harmonized System falling within Sections XVI and XVII or heading Nos 7308 and 9406 of the Harmonized System are imported by instalments, a single proof of origin for such products shall be submitted to the customs authorities upon importation of the first instalment.

Article 25Exemptions from proof of origin

Article 26Supporting documents

The documents referred to in Articles 16 (3) and 20 (3), used for the purpose of proving that products covered by a movement certificate EUR.1 or an invoice declaration can be considered as products originating in the Community, or in the West Bank and Gaza Strip and fulfil the other requirements of this Protocol, may consist inter alia of the following: (a) direct evidence of the processes carried out by the exporter or supplier to obtain the goods concerned, contained for example in his accounts or internal bookkeeping; (b) documents proving the originating status of materials used, issued or made out in the Community or the West Bank and Gaza Strip where these documents are used in accordance with domestic law; (c) documents proving the working or processing of materials in the Community or the West Bank and Gaza Strip, issued or made out in the Community or the West Bank and Gaza Strip, where these documents are used in accordance with domestic law; (d) movement certificates EUR.1 or invoice declarations proving the originating status of materials used, issued or made out in the Community or the West Bank and Gaza Strip in accordance with this Protocol.

Article 27Preservation of proof of origin and supporting documents

Article 28Discrepancies and formal errors

Article 29Amounts expressed in ecu

TITLE VI ARRANGEMENTS FOR ADMINISTRATIVE COOPERATION

Article 30Mutual assistance

Article 31Verification of proofs of origin

These results must indicate clearly whether the documents are authentic and whether the products concerned can be considered as products originating in the Community or the West Bank and Gaza Strip, and fulfil the other requirements of this Protocol.

Article 32Dispute settlement

Where disputes arise in relation to the verification procedures of Article 31 which cannot be settled between the customs authorities requesting a verification and the customs authorities responsible for carrying out this verification or where they raise a question as to the interpretation of this Protocol, they shall be submitted to the Joint Committee.

In all cases the settlement of disputes between the importer and the customs authorities of the importing country shall be under the legislation of the said country.

Article 33Penalties

Penalties shall be imposed on any person who draws up, or causes to be drawn up, a document which contains incorrect information for the purpose of obtaining a preferential treatment for products.

Article 34Free zones

TITLE VII CEUTA AND MELILLA

Article 35Application of the Protocol

Article 36

Article 36Special conditions

TITLE VIII FINAL PROVISIONS

Article 37Amendments to the Protocol

The Joint Committee may decide to amend the provisions of this Protocol.

Article 38Implementation of the Protocol

The Community and the Palestinian Authority shall each take the steps necessary to implement this Protocol.

Article 39Goods in transit or storage

The provisions of the Agreement may be applied to goods which comply with the provisions of this Protocol and which on the date of entry into force of the Agreement are either in transit or are in the Community or in the West Bank and Gaza Strip or, in temporary storage in bonded warehouses or in free zones, subject to the submission to the customs authorities of the importing State, within four months of that date, of a certificate EUR.1 endorsed retrospectively by the competent authorities of the exporting State together with the documents showing that the goods have been transported directly.

ANNEX I INTRODUCTORY NOTES TO THE LIST IN ANNEX II Note 1:

The list sets out the conditions required for all products to be considered as sufficiently worked or processed within the meaning of Article 5 of the Protocol.

Note 2:

2.1. The first two columns in the list describe the product obtained. The first column gives the heading number or chapter number used in the Harmonized System and the second column gives the description of goods used in that system for that heading or chapter. For each entry in the first two columns a rule is specified in columns 3 or 4. Where, in some cases, the entry in the first column is preceded by an 'ex`, this signifies that the rules in columns 3 or 4 apply only to the part of that heading as described in column 2.

2.2. Where several heading numbers are grouped together in column 1 or a chapter number is given and the description of products in column 2 is therefore given in general terms, the adjacent rules in columns 3 or 4 apply to all products which, under the Harmonized System, are classified in headings of the chapter or in any of the headings grouped together in column 1.

2.3. Where there are different rules in the list applying to different products within a heading, each indent contains the description of that part of the heading covered by the adjacent rules in columns 3 or 4.

2.4. Where, for an entry in the first two columns, a rule is specified in both columns 3 and 4, the exporter may opt, as an alternative, to apply either the rule set out in column 3 or that set out in column 4. If no origin rule is given in column 4, the rule set out in column 3 has to be applied.

Note 3:

3.1. The provisions of Article 5 of the Protocol concerning products having acquired originating status which are used in the manufacture of other products apply regardless of whether this status has been acquired inside the factory where these products are used or in another factory in the Community or in the West Bank and Gaza Strip.

Example:

An engine of heading No 8407, for which the rule states that the value of the non-originating materials which may be incorporated may not exceed 40 per cent of the ex-works price, is made from 'other alloy steel roughly shaped by forging` of heading No ex 7224.

If this forging has been forged in the Community from a non-originating ingot, it has already acquired originating status by virtue of the rule for heading No ex 7224 in the list. The forging can then count as originating in the value calculation for the engine regardless of whether it was produced in the same factory or in another factory in the Community. The value of the non-originating ingot is thus not taken into account when adding up the value of the non-originating materials used.

3.2. The rule in the list represents the minimum amount of working or processing required and the carrying out of more working or processing also confers originating status; conversely, the carrying out of less working or processing cannot confer originating status.

Thus if a rule provides that non-originating material at a certain level of manufacture may be used, the use of such material at an earlier stage of manufacture is allowed and the use of such material at a later stage is not.

3.3. Without prejudice to Note 3.2 where a rule states that 'materials of any heading` may be used, materials of the same heading as the product may also be used, subject, however, to any specific limitations which may also be contained in the rule.

However, the expression 'manufacture from materials of any heading, including other materials of heading No . . .` means that only materials classified in the same heading as the product of a different description than that of the product as given in column 2 of the list may be used.

3.4. When a rule in the list specifies that a product may be manufactured from more than one material, this means that any one or more materials may be used. It does not require that all be used.

Example:

The rule for fabrics of heading Nos 5208 to 5212 provides that natural fibres may be used and that chemical materials, among other materials, may also be used. This does not mean that both have to be used; it is possible to use one or the other or both.

3.5. Where a rule in the list specifies that a product must be manufactured from a particular material, the condition obviously does not prevent the use of other materials which, because of their inherent nature, cannot satisfy the rule. (See also Note 6.2 below in relation to textiles).

Example:

The rule for prepared foods of heading No 1904 which specifically excludes the use of cereals and their derivatives does not prevent the use of mineral salts, chemicals and other additives which are not products from cereals.

However, this does not apply to products which, although they cannot be manufactured from the particular materials specified in the list, can be produced from a material of the same nature at an earlier stage of manufacture.

Example:

In the case of an article of apparel of ex Chapter 62 made from non-woven materials, if the use of only non-originating yarn is allowed for this class of article, it is not possible to start from non-woven cloth - even if non-woven cloths cannot normally be made from yarn. In such cases, the starting material would normally be at the stage before yarn - that is the fibre stage.

3.6. Where, in a rule in the list, two percentages are given for the maximum value of non-originating materials that can be used, then these percentages may not be added together. In other words, the maximum value of all the non-originating materials used may never exceed the highest of the percentages given. Furthermore, the individual percentages must not be exceeded in relation to the particular materials they apply to.

Note 4:

4.1. The term 'natural fibres` is used in the list to refer to fibres other than artificial or synthetic fibres. It is restricted to the stages before spinning takes place, including waste, and, unless otherwise specified, includes fibres that have been carded, combed or otherwise processed but not spun.

4.2. The term 'natural fibres` includes horsehair of heading No 0503, silk of heading Nos 5002 and 5003 as well as the wool fibres, fine or coarse animal hair of heading Nos 5101 to 5105, the cotton fibres of heading Nos 5201 to 5203 and the other vegetable fibres of heading Nos 5301 to 5305.

4.3. The terms 'textile pulp`, 'chemical materials` and 'paper-making materials` are used in the list to describe the materials not classified in Chapters 50 to 63, which can be used to manufacture artificial, synthetic or paper fibres or yarns.

4.4. The term 'man-made staple fibres` is used in the list to refer to synthetic or artificial filament tow, staple fibres or waste, of heading Nos 5501 to 5507.

Note 5:

5.1. Where for a given product in the list a reference is made to this note, the conditions set out in column 3 shall not be applied to any basic textile materials, used in the manufacture of this product, which, taken together, represent 10 per cent or less of the total weight of all the basic textile materials used. (See also Notes 5.3 and 5.4 below).

5.2. However, the tolerance mentioned in Note 5.1 may only be applied to mixed products which have been made from two or more basic textile materials.

The following are the basic textile materials:

Example:

A yarn of heading No 5205 made from cotton fibres of heading No 5203 and synthetic staple fibres of heading No 5506 is a mixed yarn.

Therefore, non-originating synthetic staple fibres that do not satisfy the origin rules (which require manufacture from chemical materials or textile pulp) may be used up to a weight of 10 per cent of the yarn.

Example:

A woollen fabric of heading No 5112 made from woollen yarn of heading No 5107 and synthetic yarn of staple fibres of heading No 5509 is a mixed fabric. Therefore synthetic yarn which does not satisfy the origin rules (which require manufacture from chemical materials or textile pulp) or woollen yarn that does not satisfy the origin rules (which require manufacture from natural fibres, not carded or combed or otherwise prepared for spinning) or a combination of the two may be used provided their total weight does not exceed 10 per cent of the weight of the fabric.

Example:

Tufted textile fabric of heading No 5802 made from cotton yarn of heading No 5205 and cotton fabric of heading No 5210 is only a mixed product if the cotton fabric is itself a mixed fabric being made from yarns classified in two separate headings or if the cotton yarns used are themselves mixtures.

Example:

If the tufted textile fabric concerned had been made from cotton yarn of heading No 5205 and synthetic fabric of heading No 5407, then, obviously, the yarns used are two separate basic textile materials and the tufted textile fabric is accordingly a mixed product.

Example:

A carpet with tufts made from both artificial yarns and cotton yarns and with a jute backing is a mixed product because three basic textile materials are used. Thus, any non-originating materials that are at a later stage of manufacture than the rule allows may be used, provided their total weight does not exceed 10 per cent of the weight of the textile materials of the carpet. Thus, both the jute backing and/or the artificial yarns could be imported at that stage of manufacture, provided the weight conditions are met.

5.3. In the case of products incorporating 'yarn made of polyurethane segmented with flexible segments of polyether whether or not gimped` this tolerance is 20 per cent in respect of this yarn.

5.4. In the case of products incorporating 'strip consisting of a core of aluminium foil or of a core of plastic film whether or not coated with aluminium powder, of a width not exceeding 5 mm, sandwiched by means of an adhesive between two layers of plastic film`, this tolerance is 30 per cent in respect of this strip.

Note 6:

6.1. In the case of those textile products which are marked in the list by a footnote referring to this note, textile materials, with the exception of linings and interlinings, which do not satisfy the rule set out in the list in column 3 for the made-up product concerned may be used provided that they are classified in a heading other than that of the product and that their value does not exceed 8 per cent of the ex-works price of the product.

6.2. Without prejudice to Note 6.3, materials which are not classified within Chapters 50 to 63 may be used freely in the manufacture of textile products, whether or not they contain textiles.

Example:

If a rule in the list provides that for a particular textile item, such as trousers, yarn must be used, this does not prevent the use of metal items, such as buttons, because buttons are not classified within Chapters 50 to 63. For the same reason, it does not prevent the use of slide-fasteners even though slide-fasteners normally contain textiles.

6.3. Where a percentage rules applies, the value of materials which