The International Practice of the European Communities - Current Survey International Trade Developments, Including Commercial Defence Actions XIV: 1 July 1997 - 30 June 1998 6 Other Commercial Policy Instruments A Quota and Safeguard Measures Textile products The Regulation laying down common rules for imports of certain textile products from third countries was amended four times. 52 Annexes I, II, IV, V, VI, VII, and VII to the Regulation were modified, inter alia , to take into account the expiry of the Additional Protocols on trade in textile products from the Association agreements between the Community and Bulgaria, the Czech Republic, Hungary, Poland, Romania and Slovakia. FYROM (Macedonia) was taken from the countries covered by the Regulation on common rules for imports of textile products from certain third countries not covered by bilateral agreements, protocols or other arrangements. 53 Moreover, the quota levels applied to textile imports from Yugoslavia, Bosnia, Croatia and North Korea were amended. Furthermore, the Regulation providing for quantitative limits on imports of certain categories of textile products from Russia, 54 and the agreements on trade in textiles products with Vietnam 55 and FYROM 56 provide for quantitative arrangements. With regard to Vietnam, Bulgaria and Romania, the Commission also published a Regulation increasing the quota limits for imports of textiles in 1997. 57 Finally, the Commission granted additional quotas for certain textiles originating in countries participating in trade fairs organized within the Community in 1998. 58 It also published Regulations providing for quotas for re-imports of certain textile products which, originating in the Community, had undergone outward processing in Russia 59 and extending the application of the decision maintaining quota restrictions on imports of textiles from that country until 30 April 1998. 60 Steel products The Community introduced or renewed the double-checking system without quantitative restrictions with regard to imports of certain steel products from Ukraine, 61 Russia, 62 Romania, 63 Slovakia, 64 Bulgaria, 65 the Czech Republic, 66 and FYROM. 67 The Commission also adopted a Regulation introducing prior Community surveillance of imports of certain iron and steel products from third countries other than EEA members, Turkey or countries with which the EC has concluded a double-checking system; 68 and Decisions on the administration of certain restrictions on imports of certain steel products from the Russian Federation and Ukraine. 69 Furthermore, the Council published Communications establishing the quantities of certain steel products that could be imported from Kazakhstan within the period 1 January-30 June and 1 July-31 December 1998 70 and a quota for imports of certain flat-rolled and long steel products from Russia. 71 The Council also amended Annex V to the Decision administering certain restrictions on imports of certain steel products from Russia and Ukraine. 72 Others Several decisions providing for quota import limits on certain footwear, tableware and kitchenware, and toys from China, allocating the 1998 quota and redistributing unused quantities were published. 73 B Trade Barriers Regulation TBR cases 1. Trade practices maintained by Brazil in relation to trade in textile products, [1998] C63/2 (initiation) The complainant alleged that Brazil's non-automatic import licensing system and the manner in which it was managed through, notably, compulsory import payment terms and minimum import prices, constitutes an obstacle to trade. 2. US Anti-dumping Act of 1916, [1998] OJ L126/36 (finding of existence of an obstacle to trade) The Commission found that certain provisions of the US Anti-dumping Act of 1916 violated, inter alia , Articles V(1)(a) and (b) of GATT 1994 and 2.2 of the WTO Anti-Dumping Agreement [ADA], Article V(1) of GATT 1994 and 2.1 of the WTO ADA, Article V(2) of GATT 1994 and Article 1 of the WTO ADA. The Commission decided to request WTO consultations on this issue. 3. Measures imposed by the Republic of Korea affecting the import, distribution and advertising of cosmetics, perfume and toiletries products, [1998] OJ C154/12 (initiation) The complainant alleged that Korean practices involving conformity assessment procedures, administrative monitoring of the imported products and the prior authorization procedure for advertising are discriminatory and constitute obstacles to trade. 4. Japanese practices in respect of imports of leather, [1998] L159/65 (finding of existence of an obstacle to trade) The Commission found first that the management of the tariff quota is "extremely" complex and constitutes indirect protection for domestic leather producers in Japan. Second, the Commission found that Japanese tanneries are beneficiaries of a series of financial aid schemes. In particular, the Commission determined that the aggregated total value of the different programmes is likely to reach the ad valorem threshold of 5 per cent of sales of leather. Therefore, in the Commission's view, the presumption of serious prejudice to the Community's interests as per Articles 5 and 6 of the Agreement on Subsidies and Countervailing Measures would apply. Third, the Commission found that especially the managing of import licences acts as deterrent for the Community producers and increases considerably the Community producers' exports costs. The Commission decided to request consultations in the WTO over these practices. C Anti-Helms-Burton Legislation After protracted negotiations, the EC and the United States reached an agreement over the Helms-Burton and D'Amato Laws during the bilateral Summit held in May 1998. 74 According to the agreement, the US must amend the above Laws to provide a permanent waiver of Title IV. Moreover, the EC and the US agreed that they should reinforce the protection of investment around the world and discourage investments in illegally expropriated property. The agreement was criticized by both the European Parliament and by the US Congress. The Commission warned that if the agreement is not enforced by the US, it may request consultations within the WTO and eventually a WTO panel. D Generalized System of Preferences The Council adopted legislation implementing the social and environmental clauses of Articles 7 and 8 of the EC agricultural and industrial GSP Regulations. 75 With regard to the social clause, preferential duties for industrial products will be reduced by 15 per cent, 25 per cent and 35 per cent for very sensitive, sensitive, and semi-sensitive products, respectively. For agricultural products, tariffs will be reduced by 10 per cent, 20 per cent and 35 per cent for the above-mentioned categories of products. These percentages will have to be added to the tariff reductions already granted. In order to enjoy these benefits, the applying country will have to give details of its domestic legislation incorporating the substance of the standards laid down in ILO Conventions Nos. 87 and 98 concerning the right to organize and to bargain collectively, and Convention No. 138 on the minimum age of admission to employment. The requesting country will also have to give details concerning the measures taken to implement and monitor the above legislation and to commit itself to take full responsibility for monitoring. The Commission, in cooperation with the requesting country, may carry out checks to verify the information gathered. Finally, the examination of the request may not take more than one year from the date of the receipt of the request. Based on the above information and the verification, the Commission will decide, after consultation with the Member States, to grant or not the requested additional benefit. Finally, the above preferential tariff treatment can also be granted on a sectoral basis if the above-mentioned ILO Conventions are effectively applied only in these sectors. As far as the environmental clause is concerned, the tariff reduction will be the same as provided for under the social clause. With regard to the procedure, the requesting country will have to give details to the Commission concerning the domestic legislation implementing the substance of the ITTO standards; the measures implementing them; and to commit itself to maintain that legislation and the implementing measures. Finally, the Commission may also verify in situ the information submitted. As in the case of the social clause, the Commission will decide, after consultation with the Member States, to grant or not the requested additional benefits. The environmental clause is in practice apparently less relevant because it is unclear precisely which standards must be fulfilled. The Council extended the list of agricultural and industrial products covered by preferential tariffs. 76 As far as industrial products are concerned, the list includes, inter alia , several minerals which enjoy tariff-free treatment as from 1 January 1998. With regard to agricultural products, the Council granted tariff reductions or exemptions, depending on the degree of sensitivity, to certain products not included previously in the agricultural GSP Regulation. Other relevant developments include the exclusion of Hong Kong, Singapore and Korea from the list of beneficiaries of the EC GSP; 77 the publication of the list of country-sector pairs which were graduated from GSP as from January 1998; 78 the introduction of several technical amendments to the customs classification concerning the EC industrial and agricultural GSP Regulations were published; 79 and the initiation of an investigation with a view to reintroducing the Common Customs tariff duty on imports of tuna from Ecuador. 80 E Other The Community imposed protective measures on imports of certain fishery products from Malaysia due to the detection of Salmonella paratyphi .81 Furthermore, it also imposed special conditions on the importation of pistachios from Iran because of the presence of excessive levels of Aflatoxin B1 82 and suspended imports of live birds from Hong Kong in order to prevent the introduction of influenza A H 5N1 into the EC. 83 52 OJ (1997) L199/6, (1998) L45/1, (1998) L122/11 and (1998) L151/10. 53 OJ (1998) L199/6. 54 OJ (1998) L100/52. 55 OJ (1998) L41/14. 56 OJ (1997) L233/32. 57 OJ (1997) L332/38; L284/37; and, L284/38. 58 OJ (1998) L28/9. 59 OJ (1997) L350/60. 60 OJ (1998) L100/52. 61 OJ (1997) L210/1. 62 OJ (1997) L300/36. 63 OJ (1998) L13/1. 64 OJ (1998) L13/15. 65 OJ (1998) L13/29. 66 OJ (1998) L13/43. 67 OJ (1997) L210/1 and (1998) L20/1. 68 OJ (1998) L98/8. 69 OJ (1997) L306/7. 70 OJ (1997) C390/1 and (1998) C197/1. 71 OJ (1997) C239/1. 72 OJ (1997) L222/4. 73 OJ (1997) L190/24; L284/42; (1998) L113/17; C116/5; L159/65; L176/17; and L183/94. 74 For an overview of the dispute see Vermulst and Driessen, "The Choice of a Switch: The European Reaction to the Helms-Burton Act ", Leiden Journal of International Law (1998) 81. 75 OJ (1998) L160/22. 76 OJ (1998) L80/1. 77 OJ (1997) L354/9. 78 OJ (1997) C384/5. 79 OJ (1998) L48/20 and 26. 80 OJ (1998) L8/3. 81 OJ (1997) L214/55. 82 OJ (1997) L343/30. 83 OJ (1998) L15/45.
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