title: RECOMMENDATION FOR A COUNCIL DECISION on the stand to be adopted by the Community at the international negotiations on the amendment of provisions of the Arran- gement on Guidelines for Officially Supported Export Credits (Communication of the Commission to the Council)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (81) 134
Vol. 1981/9007
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak---                                                             COM(81 ) 134 final
                                                             Bruxelles, le ^ 6th March 1981
      COMMISSION
            DES
COMMUNAUTES EUROPEENNES
      Secrétariat général
                             RECOMMENDATION FOR A COUNCIL DECISION^
                   on the stand to be adopted by the Community at the international
                   negotiations on the amendment of          provisions of the Arran-
                   gement on Guidelines for Officially Supported Export Credits
                          (Communication of the Commission to the Council )
           C0M(81 ) 134 final
 ---pagebreak--- Introduction
1.           As happens every year> the    Arrangement on guidelines for
   officially supported export credits" ( usually called " Consensus")
    is to be reviewed by the countries which adhere to itC'Participants ").
                                                                            X
   The next such review is scheduled to take place on 11 May 1981 .
2.           The discussion which will take place will naturally be^
   influenced by the outcome of the negotiations of last year which
   ended 19 December with a set of " conclusions " which in fact reflected
   diverging views.                                        <\^
   a ) On the one hand, certain Participants ( US , C^feda, Sweden, etc.)
       sought a change in the system of interest H^fes, referring to
       the conclusions of the OECD Ministerial Council and to the
       Communique of the Venice Western Summit ; these Delegations advocated
       a system which would1 bring the irrtS^est rate matrix of the Consensus
                                         cS2
       nearer to the general level o-^yrarket interest rates . In that
       context they advocated a " (liferent i ated Rate System" ( i.e. with
       differentiated rates for each currency ).    Other Participants
       suggested a " Uniform Moving Matrix " ( i.e. a system of uniform
       interest rates which would be adjusted automatically according to
       an average ^.
       In addition^j^ large number of Participants regretted the absence
       of " transparency" concerning tied aid credits .
   b ) The Community for its part proposed , in accordance with the
       ^liberations of the Council on 17 November and 15 December
         an immediate increase of the minimum rates of the Consensus by
         1 % for categories I and II , and by 0.8 % for category 3JIJ , as
         well as a review, in mid"19&,1 and before the end of 1981 at the
          latest , of the advisability of a new adaptation of the minimum
         interest rates in the light of the then prevailing economic and
         monetary situation ;
       ~ as regards tied aid credits , to submit those where the grant
         element is less than 15 X to the prior notification and discussion
         procedure ( para 9 ( a ) 1 of the Arrangement .
 ---pagebreak---                                                   CD
      c ) Not only were the Community proposals considered insufficient
          but the discussions highlighted an additional difficulty relating
          to the situation of Japan : given that the Japanese commercial
          market interest rate would allegedly fall below the Consensus^
          minima if the latter were to be increased according to the 5^
          proposals, this country wanted the Export~Import Bank of i^an ,
          although an official financing agency , to be allowed to apply
          the commercial market interest rate , and even to maintain the
          same differentials as now exist in favour of ca^^&ry II and
          III countries .
          This position was not acceptable , in full^^ in part, to certain
          Participants , including the Community .   In effect the Consensus
          does not foresee the possibility for an official financing insti "
          tut ion to provide finance at a r^e lower than the Consensus. In
          that context , at the time of      discussion on 15 December , the
          Council had indicated the        for all pertinent information to be
          supplied about commercias^nterest rates and stressed the need to
          clarify the possibility for other countries * exporters to have
          access to financing in the currency concerned , in the present case
          Ye".
3.              It t^fcgainst this background that the " Conclusions adopted
      by the Participants" on 19 December 1980 limit themselves to mention
      the idea of an annual review of the interest rates grill of the
       Cor^sensus without introducing any modification of the present matrix
     Xxj)* of any other provisions of the Consensus .
ft.             The present Communication of the Commission will therefore
       start from the positions reached last December , and, taking into
       account the elements of the Directives already approved by the Council
       as well as of the clarifications obtained on the functioning of public
      export credit Agencies and of the financial market in Japan , it seeks
       to propose to the Council the elements of a Community position such as
       to uphold and to improve the Consensus * and which could open the door
       to a compromise next May .   The absence of a compromise in May wculj
       risk putting the operation of the Consensus in danger which would
     . be damaging" for all the industrialized countries and for the Community
       itself .                                                               ,
 C1 ) See footnote on page 3
 ---pagebreak---    Proposals for a Community position
   5.              One should recall that , following the Directives approved
        by the Council on 6 May 1980 , the Community has already proposed
                                                      (1)
        a number of improvements to the Consensus         . These proposals have
        in no way lost their value and the Commission will continue to defen^
        them .                         \
    6.             Given that the preoccupations of third countries were mainly
         concentrated on :
        - the " system " of interest rates in the Consensus ,
        - the practice of tied aid tredits ,
        - the problem of the countries where commercial ^§fket interest rates
            are or will be below Consensus levels,          ^
        the Commission proposes to the Council the following elements for a
        Community position .
    7.             The most important- objective ^jfceountries like the US , Canada,
        Sweden and Switzerland is to changj^rhe system of interest rates in
        the Consensus, with a view to "^l^iging Consensus rates closer to
        market interest rates" as welf^s to " reducing or eliminating interest
         rate subsidies".
                   The Commissi q^,has already submitted its views to the Council
         ( C0M(80)330 final <^^16 June 1980) and does not propose to justify them
         again .
                         CN
                   However , in the Light of the discussions of the Council in
          1980 and under present economic circumstances , characterised , inter
                 by violent swings in exchange rates , an oscillating evolution of
        ^&erest rates (mainly short term but also medium and long term ), the
        ^                                                                 4
         difficulty of achieving concerted monetary policies amongst t,he main
                                                                           ■••/■■
  ( 1 ) These proposals were : to raise the minimum down payment from 15 % to
         20 % for Category I , to limit official support for local costs to insu-
^        ranee and guarantees for Category II , to limit the length of credit for
         Category I to 5 years , to include nuclear power plants in the scope of
         the Consensus with a uniform maximum length of credit of 10 years for
         these as well as for conventional power plants , to include disciplines
         concerning the sale of agricultural products , and to . include liquid
        natural gas carriers with a maximum length of credit of 10 years and
        the same minimum interest rate as provided for in the Sectoral Arrange"
         ment on Ships .
 ---pagebreak---          industrialised countries# : the persistence Of trade and/ of balance
         Of payments deficitsat1 least for Europe; these circumstances seem
     . to indicate * prQgres$itfeafi<fpragmatieapproach father than making
                                       ^                            1 * * î[            \     *v               *            ^         j-      '                     •
         animmedUt* choice of #' radically pew, fcysttar.                                                                                "# \ •»
                                                    *          " - *      r v         - *        «* *    v*      1         jI   ¥     i*         '
      * - I,                       It Is thereforeproposedto theCouncU -s
                    ,1 ·-· ;■■,■               ,; '   ; ■■·■■. -Λ ,;--,.           .    -          * ■      Λ                                            : Λ^' .· ■
      a ) as aft* immediate measure, an Increase pf< the minimum rates of the
                  Consensus by-\T X foi* categories I                                                                                D.f * for
                  category                   - with . effect' 'We^\1;/iuiy
                , ■' : ■ - ν^ ■ V                                      · '·: ■ ' :.· ^                                                                '
      b)> to confirm the not ion **• already introduced irf^he last "Conclusions
            .*'} ofiythf Participants"                                 of > ;rtarta#d syst<pm In which Participants
       . ' : would discuss and decidt \adjustwent s at each annual review ;
                                                                                :v :         ■■■>■.        < -    ■
                                                                        >                  .. v t - " A ■
       c> to take into consideratiorv^ at easSyannual review , the various
                  elementsof the then existing jsSBhomic 'and monetary situation ; among
                  these elements to beconsidfi^d-'theaverage of the medium 'term
                                  -M.v : .               .. '                  -05?                                     '■ .
                  interest rates in the five currencies of the revised " basket " of
                  the SDR. <US Dollar, DM^ Sterling^ FF ^ Yen) calculated on the last
         v.' ;,, six months before the date of th^ annual; review^ would serve as a
          , | by"flashing                light'^^e* Annex ) : if that average has itself increased
                           more than JBl&r percentage point there would be a presumption for
                                                                              . 1.'  -                      ■'
               < ^ .               . . _ • (\V                   a      , »     . .      , ^
                  the need otNsrt upward adjustments                                                    : * ,t, <
      d) finally# that , as -the situation exists both in_ law and
               ' in^fact inside the Community by virtue of Article 92 of the Treaty,
                <fc?ie Participants commit themselves ftof to subsidise interest rates
  ■                              ν\.             ■·   ..              .            ( 2)                            .
    ,«^ on sales amongst themselves                                                        af froffl 1 January 1982 . This would
                 at the same time eliminate the existing discrimination which works
                 agalnst flember States . !"
' ..·                             V ν.                                      , : νΛ            '· ■ \                         .·     ■ ·.. ·        ,. ■
 ( 1 ) In order to avoid the administrative comfTTfcations $nd the bureaur
  1            cratic burden of ratifying "prior commitments", another possibility
      ^ 1s to propose that such an increase be implemented on 1 Septer-ber ,
               i.e. 3 ninths after the date at which Participants have taken the
               decision, and that no prior commitments would be accepted after
       .       t September .                                                                                :
 < 2) Katurally, the limitation of credit length to 5 years as well as thee
              Increase in minimum down payments to 20 X# which have already been
 > approved; by the Council in ftay 19$0> would also apply.
 ---pagebreak---  8.          Regarding the practice of tied aid credits , the Council has
     already approved in December 1980 the proposal to submit those with
     a grant element below 15 % to the prior notification and discussion
     procedure foreseen in Article 9 ( a ) 1 of the Arrangement .
             Since then , several countries ( and the most recent casaSFs
             Since then, several countries (and the most recent cas^S>s
     Japan ) have either decided to introduce or are studying the intro
     duction of mixed credit facilities .     It seems therefore in the
     interest of the Community itself and useful to the ^jpctioning of
     the Consensus to improve transparency regarding ^ftree practices ,
     and the Commission therefore suggests to compare this discipline
     in terms of procedure by proposing to submi «^*
     a ) tied aid credits with a grant element above 15 % and less than 25 %
         to the prior notification without di scussion procedure foreseen in
         Article 9 ( b) 1 of the Arranc^jpnt ( these come at the present time
         under the prompt notificatiJ$^ procedure of Article 9 ( c ) J );
     b ) tied aid credits with a grant element of 25 % and above to the
         prompt notification procedure of Article 9 ( c ) 1 of the Arrangement
         (at      present^hese credits are not subject to any notification
         under the Are^&ement ) .
 9.          In DSrember last , one of the difficulties on which the discussions
     had broken down was that relating to the position of countries or
     rather currencies for which the commercial market interest rate is
     q^Would fall below Consensus minima. This problem is particularly
  ^S^cute in the case of Japan.
*
            In this context , it is necessary to define " official support ".
    Work on this element is in progress but it is not possible at this
    stage to offer a clear definition which would take into account , inter
    alia , the realities of the market and the mechanisms of intervention
    by all the Participants .
 ---pagebreak---        That is why the Commission proposes that , in the case
of Japan , and In conformity with the provisions of the Consensus ,
the Japanese Government undertakes , when the long~term commercial
rates of interest are below the levels of the Consensus
- either , to allow Eximbank - an official organisation creat ^
  to aid exports - to finance export credits only in such a manner
  that the ratesof interest on export credits conform to those of
  the Consensus;                                    0^
~ or, to allow Japanese exporters to finance tt^^elves on the
  commercial market without the intervention^^ Eximbank.
 ---pagebreak--- Conclusion
                                                                                " .\
10 .        Taken together / all these elements , i.e. those already approvecf-
     by the Council in May and in December 1980, combined with those proposed
     to the Council set out abqve, could in the view of the Commissi^§orm
     the basis of a consensus within the Council and V/ ould consti^j^
     a Community position such as
     - to reduce the burden ( budgetary or otherwise ) which results for
        the respective national economies from the variou^Techniques
                                                         xSJ*
                                                                        of
        interest rate subsidisation ;
     ** to improve the " transparency" of various nqvional practices in the
        field of tied aid credits ;
     - to deal with the problem of low interest rate countries and
        especially of Japan /
     - and finally to strengthen thQ^C-onsensus.
y
 ---pagebreak--- A.  INTEREST RATES               TAUX D' INTERET                                                                                ANNEX
                                             Nur.ber of years in maximum repayments term
               %
     Classif icatvdk,
                                             Délais maximum de remboursement en nombre d' anné es
       of country ^                       2 to 5                                   over 5 to 8.5                              over 8.5 to 10
        du pays
                               1 / 4/ 78     1 / 7/ 80   1 / 7/ 81 *      1 / 4 / 78       1 / 7/ 80    1 / 7/ 81   1 / 4/ 78    1 / 7/ 80 1 / 7/ 81 *
     CAT . 1    .
                              %75              8.50        9.50      -      8.00             8.75         9.75             Not applicable
     CAT . II
                                   V
                                 7.25 r        8.00        9.00             7.75             8.50         9.50             Not applicable
                                                                            7.50             7.75         8. 75       7.50         7.75    8.55
     CAT . Ilt                   7.25
                                               7'5Q%       8.50
 * According to the present proposal
 * Selon la proposition actuelle
                                                              **
B. BASIC MINIMUM RATES WEIGHTED BY NEW SDR-WEIGHTS                 -    TAUX MINIMA. DE BASE PONDERES SELON LA PONDERATION DU DTS
                                                                        __                                        ;               ^
   June 1977      8.25  Oct . 1977       8.0     Nov. 1977        7.875                Rates of interest of secondary market bonds for each
   June 1978      8.125 Oct . 1978       8.25'
                                         8.2     Nov. 1978        _ ___           ^pf the 5 currencies in the new SDR averaged over
                                                                                ^KnmonthS/
                                                                                «oPmon         or market rate of last month of period
   June 1979      8. 75 Oct . 1979       9.5     Nov . 1979       9.375                wrajfehever is the lower , weighted by new SDR weights .
   June 1980   10.125   Oct . 1980     10.5
                                         0.5     Nov . 1980      10 . 750
                                                                                ** Taux d' intérêt des marchés secondaires pour les obligations
                                                                                dans chacune de ces 5 devises dans le nouveau DTS ; moyenne
                                                                                de 6 mois ou, taux de marché pour le dernier mois , en pre~
                                                                                nant le chiftyte le plus bas des deux, pondéré selon la
                                                                                pondération di^^uveau DTS.
                                                                                %'
                                                                                \%
 ---pagebreak---                       COUNCIL DECISION
on the stand to be adopted by the Community at the international
negotiations on the amendment of certain provisions of tf^»
Arrangement on Guidelines for Officially Supported        Credits
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,^
Having regard to the Treaty establis&Sng the European Economic Community ,
and in particular Article 113 thaJ&of ,
Having regard to the Recommendation from the Commission ,
 ---pagebreak--- Whereas it is necessary to amend and augment the directives adopted by
the Council Decisions of 6 May 1980 / 25 November 1980 and 16 December 1980
on the stand to be adopted by the Community at the international
negotiations on the amendment of the Arrangement on Guidelines for
Officially Supported Export Credits ,                               .cS^*
                                                                  <#N
HAS DECIDED AS  FOLLOWS
                          Sole Article
   At the international negotiations on the amendm|^ of the
Arrangement on Guidelines for Officially Support ^ Export Credits/
the Commission shall express the Community position in accordance
with the attached directives .
                                       A#
   It shall act in consultation witfrowe special Committee provided
for in Article 113 of the Treaty^which shall assist it in its task .
                                    Done at Brussels / .
                    v#                      For the Council
                ^                              The President
       *
 ---pagebreak---           . I
1
                Negotiating directive® concerning tht amendment
   of tht Arrangement on Guidelines for Officially Supported
                              €*port Credits
  Confirmation of the Council negotiating directives adopted by the               '
  Decisions of 6 May 1980, of 25 November 198Q and of 16 December 1$§b
  Regarding the level of the minimum interest rates in the Arrangement
 the Commission will propose to the other Participants :         a
                                                                <#
  an immediate increase of 1 X for Categories I and II ,          of 0,8 X
  for Category lit with effect from 1 July 1981 *^
 Additional Council negotiating directives
         Regarding tht system of Interest rate^tht Commission *111 propose
         to tht other Participants t          '
      ' •• that the notion will bt con^^ed of • "managed systen" 1n which .
              Participants would discus a and dtddt adjustments at each annual
              Rtvltw.
        •» to consider, at eact^annual review, the various elements of the then
            existing econom^bnd monetary situation, Including the average of
            the medium te^Nnterest rates 1n the five currencies of the revised
    !       "basket" of tW SDR < US Dollar, DM , Sterling, FF, Yen ) calculated on
            tht last 6*months before the date of the annual review serving as a
            "flashing light"/ and If that average has Itself Increased by more
      , t^one percentage point there would bt a presumption for the need
                 an upward adjustment
                    ***" – -
                                                     I
      -V'
                                                A "
      f ** that Participants will commit themselves not to subsidise
      '       Interest rates on sales amongst themselves ss from 1 January 1982;
                                                                          •••/ • •
         CI) Or »t somt ©thtr appropflatt d*tt this ytar
 ---pagebreak---   2. Regarding tied aid credits the Commission vltl propose to the
       other Participants to submit :
       • those credits with'a grant element above 15 X and less than 2S X
            to the prior notification without discussion procedure under   ^
           paragraph 9 ( b ) 1 of th^ Arrangement ;
    • m those credits with a grant element of 25 X and above to th«£?
   )       prompt notification procedure under paragraphe 9 ( c ) 1 of tht
          Arrangement .
 •                       Regarding Japan, the Commlssloq^U propose to
     the other Participants, when the long-term co^berdal rates of
     Interest are below the levels of the Consensu* that the Japanese
     Government undertakes, in conformity ^ith the provisions of the
    Consensu* that the Eximbank of Jap<^^will. only finance exports
     1n such • manner that the inter^j^rate on Export Credits 1 * ,
     1n conformity with the level*£^ the Consensus.
        i •
ν                 • • «          '  .  •      t
        #
^            .


title: Recommendation for a COUNCIL DECISION on the signing of the Protocols, 1983, for the further extension of the Wheat Trade Convention, 1971, and the Food Aid Convention, 1980, constituting the International Wheat Agreement, 1971, and the deposit of a declaration of provisional application of the said Protocols (submitted to the Council by the Commission)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (83) 096
Vol. 1983/0031
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak--- COMMISSION OF THE E U R O P E A N COMMUNITIES
                                                                         COM(83) 96 f i n a l
                                                                         Brussels,        1 March 1 9 8 3
                                       Recommendation f o r a
                                          COUNCIL DECISION
    on t h e s i g n i n g  of the Protocols,               1983, f o r t h e f u r t h e r extension
   of t h e Wheat T r a d e C o n v e n t i o n , 1 9 7 1 , and t h e Food A i d C o n v e n t i o n ,
    1980, c o n s t i t u t i n g t h e I n t e r n a t i o n a l  Wheat A g r e e m e n t , 1 9 7 1 , and
     the deposit         of a declaration             o f p r o v i s i o n a l a p p l i c a t i o n of t h e
                                            said        Protocols
                    (submitted t o t h e Council                  by t h e Commission)
 COM(83) 96 f i n a l
 ---pagebreak---                                       EXPLANATORY MEMORANDUM
INTRODUCTION
1. At meetings of the International Wheat Council and of the Food Aid Committee,
   held in London from 29 November to 2 December 1982,                         the texts of Protocols
   for the extension of the conventions                   constituting the International Wheat
   Agreement for a further three year period beginning on 1 July 1983 were
   drawn up. These texts are to be found in Annex 2.
2. It is now necessary           to proceed to the signature and the deposit of declara
   tions of provisional application of the protocols by the Community.
PROCEDURE
3. The necessary procedure is as follows                    :
   a) The Community and a l l Member States, acting simultaneously, must deposit
       the declarations of provisional application of the protocols between 4 April
       and 10 May 1983 inclusive in accordance with A r t i c l e s 5 and 8 of the protocol
       for    the further extension of the Wheat Trade Convention and in accordance
       with A r t i c l e IV and VII of the protocol for the further extension of the
       Food Aid Convention.
   b) Each Member state of the Community which w i l l also have had previously to
       acceed to both Conventions, must deposit                        as soon as possible the instruments
       of accession,          in conformity, respectively with a r t i c l e s 7 and VIII of the
       p r o t o c o l s , according to t i s i n s t i t u t i o n a l procedures. The conclusion of the
       protocols by the Community as such w i l l take place as soon as a l l Member
       states have acceded.
FINANCIAL PROVISIONS
4. The extension of the Wheat Trade Convention implies the continuance of the
    Community's present          contributions to the administrative budget of the Interna
   tional      Wheat Council for a further period of three years beginning on 1 July 1983.
5. The extension of the Food Aid Convention implies the maintenance, for the same
   period, of the Community's obligation to supply, as food a i d , a minimum of
   1.650.000 tonnes per annum of cereals, distributed between the Community as
    such and the Member States, in accordance with the approriate decisions of the
    Council of the EEC.
 ---pagebreak---                                    - 2 -
RECOMMENDATION
6. The Council is invited to take a decision concerning the signature and
   the deposit with the depository authority by 10 May 1983 of the appropriate
   legal instruments, the draft texts of which are attached.
 ---pagebreak---                                              COUNCIL DECISION
on the signing of the Protocols, 1983,                for the further extension of the Wheat
Trade Convention, 1971, and the Food Aid Convention, 1980, constituting                 the
International          Wheat Agreement, 1971, and the deposit       of a declaration of
provisional application of the said Protocols.
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing                the European Economic Community, and
in p a r t i c u l a r A r t i c l e 113 thereof.
Having regard to the recommendation from the Commission,
HAS DECIDED AS FOLLOWS :
                                                Article 1
The President of the Council is hereby authorized to designate the person empowered
to s i g n , subject to their being concluded subsequently,             the Protocols, 1983, for
the further extension of the Wheat Trade Convention, 1971, and the Food Aid
Convention, 1980, constituting                the International Wheat Agreement, 1971.
                                                Article 2
The President of the Council is hereby also authorized to designate the person
empowered to sign the declaration of provisional application of the Protocols
referred to in A r t i c l e 1 and to deposit          the said declaration with the Government
of the United States of America.
The texts of the Protocols and of the declaration of provisional application
are attached to this Decision.
Done at Brussels,                                                    For the Council,
 ---pagebreak---                                                                                ANNEX 1
                                 DECLARATION OF               PROVISIONAL          APPLICATION
 of   the Protocols,            1983,      "for t h e f u r t h e r    e x t e n s i o n o f t h e Wheat T r a d e      Convention,
 1971,      and    t h e Food A i d C o n v e n t i o n , 1 9 8 0 ,      c o n s t i t u t i n g the International            Wheat
 Agreement,           1971.
 It   will     n o t be p o s s i b l e    f o r the European Economic                     Community t o c o m p l e t e      before
 30   J u n e 1983      the i n s t i t u t i o n a l    accession procedures                  laid  down i n A r t i c l e 6 o f     the
 Protocol        for the.further             e x t e n s i o n o f t h e Wheat T r a d e         Convention, 1971,            and  in
 Article      VI o f t h e P r o t o c o l       for the further             e x t e n s i o n o f t h e Food A i d     Convention,
.1980.
 In accordance           with    A r t i c l e s 8 and        VII of the s a i d P r o t o c o l s ,       t h e Community         therefore
 makes t h i s       declaration         of p r o v i s i o n a l  a p p l i c a t i o n . By    depositing      such     a    declaration,
 t h e Community r e g a r d s         i t s e l f t o be p r o v i s i o n a l l y a p a r t y      toi:the P r o t o c o l s    concerned,
 with     a l l t h e r i g h t s and o b l i g a t i o n s w h i c h      result therefrom, u n t i l            such      time as    the
 Council       o f t h e E u r o p e a n C o m m u n i t i e s has     taken a f i n a l         decision      on t h e   matter.
                                                                                On    behalf of      the
                                                                       European Economic                Community
 ---pagebreak---                                                                                ANNEX 2
                      1983    PROTOCOLS FOR THE F U R T H E R E X T E N S I O N                OF THE
                                    WHEAT TRADE CONVENTION,                      1 9 7 1 AND
                                     THE FOOD A I D CONVENTION, 1 9 8 0 ,
                  CONSTITUTING THE INTERNATIONAL WHEAT AGREEMENT, 1 9 7 1
                                                          PREAMBLE
                    The    Conference         t o e s t a b l i s h t h e t e x t s o f t h e 1983
Protocols           f o r t h e f u r t h e r e x t e n s i o n o f t h e Wheat T r a d e           Convention,
1971      a n d t h e Food A i d C o n v e n t i o n , 1980, c o n s t i t u t i n g t h e
I n t e r n a t i o n a l Wheat A g r e e m e n t , 1 9 7 1
Considering that                t h e I n t e r n a t i o n a l Wheat A g r e e m e n t was r e v i s e d ,
          renewed o r extended                on s e v e r a l     o c c a s i o n s since 1949,
Considering that                t h e I n t e r n a t i o n a l Wheat A g r e e m e n t , 1 9 7 1 , c o n s i s t i n g
          o f t w o s e p a r a t e l e g a l i n s t r u m e n t s - t h e Wheat T r a d e           Convention,
          1971      and t h e Food A i d C o n v e n t i o n , 1980, which                     were
          extended         by P r o t o c o l   i n 1981 - w i l l           expire      o n 30 J u n e 1 9 8 3 ,
Has e s t a b l i s h e d     t h e t e x t s o f t h e 1983 P r o t o c o l s            f o r the further
          e x t e n s i o n o f t h e Wheat T r a d e          C o n v e n t i o n , 1971 and t h e Food
          A i d C o n v e n t i o n , 1980.
 ---pagebreak---                             1983     PROTOCOL FOR THE FURTHER                     EXTENSION OF
                                     THE WHEAT TRADE CONVENTION,                        1971
The     Governments p a r t y               to this        Protocol,
Considering             t h a t t h e Wheat T r a d e C o n v e n t i o n , 1 9 7 1 ( h e r e i n a f t e r
          r e f e r r e d t o a s " t h e C o n v e n t i o n " ) o f t h e I n t e r n a t i o n a l Wheat
          A g r e e m e n t , 1 9 7 1 , w h i c h was f u r t h e r e x t e n d e d b y P r o t o c o l i n
          1 9 8 1 , e x p i r e s o n 30 J u n e 1 9 8 3 ,
Have a g r e e d a s f o l l o w s :
                                                           ARTICLE 1
                  Extension,            e x p i r y and t e r m i n a t i o n    of the Convention
                    Subject t o the provisions of A r t i c l e 2 of t h i s                             Protocol,
the C o n v e n t i o n s h a l l c o n t i n u e i n f o r c e between t h e p a r t i e s t o t h i s
Protocol u n t i l             30 J u n e     1986 p r o v i d e d     t h a t , i f a new i n t e r n a t i o n a l
 agreement c o v e r i n g            wheat e n t e r s        i n t o f o r c e b e f o r e 30 J u n e   1986, t h i s
P r o t o c o l s h a l l remain i n force only u n t i l                       the date of entry            into
 f o r c e o f t h e new            agreement.
                                                           ARTICLE 2
                               Inoperative            provisions of the Convention
                     The     f o l l o w i n g p r o v i s i o n s o f t h e C o n v e n t i o n s h a l l b e deemed
 t o be i n o p e r a t i v e w i t h          e f f e c t from 1 J u l y 1983:
           (a)       paragraph           (4) o f A r t i c l e 1 9 ;
            (b)      Articles          22 t o 26          inclusive;
            (c)      paragraph            (1) o f A r t i c l e 2 7 ;
            (d)      Articles          29 t o 31          inclusive.
 ---pagebreak---                                                               -2     -
                                                        ARTICLE 3
                                                        Definition
                    Any r e f e r e n c e i n t h i s       P r o t o c o l t o a "Government" o r
"Governments" s h a l l be c o n s t r u e d                  as including a reference t othe
E u r o p e a n E c o n o m i c Community            ( h e r e i n a f t e r r e f e r r e d t o as "the
Community").             A c c o r d i n g l y , any r e f e r e n c e       i n this       Protocol to
"signature" or t o the "deposit of instruments                                        of ratification,
acceptance o r approval"                     o r "an i n s t r u m e n t       o f a c c e s s i o n " o r "a
d e c l a r a t i o n o f p r o v i s i o n a l a p p l i c a t i o n " b y a Government s h a l l ,                i n the
case o f t h e Community, be c o n s t r u e d                      as i n c l u d i n g signature o r
d e c l a r a t i o n o f p r o v i s i o n a l a p p l i c a t i o n on b e h a l f o f t h e Community b y
i t s competent a u t h o r i t y and t h e d e p o s i t o f t h e instrument                            r e q u i r e d by
the i n s t i t u t i o n a l    p r o c e d u r e s o f t h e Community               t o be d e p o s i t e d   f o r the
c o n c l u s i o n o f an i n t e r n a t i o n a l agreement.
                                                        ARTICLE         4
                                                          Finance
                    The i n i t i a l    c o n t r i b u t i o n o f any e x p o r t i n g o r i m p o r t i n g
member a c c e d i n g        t o t h i s P r o t o c o l under paragraph                    (1)(b) o f A r t i c l e     7
t h e r e o f , s h a l l be a s s e s s e d       b y t h e C o u n c i l on t h e b a s i s o f t h e v o t e s
t o be d i s t r i b u t e d t o i t and t h e p e r i o d r e m a i n i n g                i n the current            crop
y e a r , b u t t h e a s s e s s m e n t s made u p o n o t h e r e x p o r t i n g a n d i m p o r t i n g
members f o r t h e c u r r e n t c r o p y e a r               s h a l l n o t be a l t e r e d .
 ---pagebreak---                                                          - 3 -
                                                       ARTICLE 5
                                                       Signature
                     T h i s P r o t o c o l s h a l l be open f o r s i g n a t u r e i n Washington
 from 4 A p r i l          1983 u n t i l and i n c l u d i n g 10 May        1983      by Governments o f
 c o u n t r i e s p a r t y to the C o n v e n t i o n as f u r t h e r extended by the                 1981
 P r o t o c o l , o r which are p r o v i s i o n a l l y regarded as p a r t y t o the
 Convention as f u r t h e r extended by the 1981                         P r o t o c o l , on
 1 December 1982,                o r which a r e members o f the U n i t e d N a t i o n s , o f i t s
 s p e c i a l i z e d a g e n c i e s or o f the I n t e r n a t i o n a l Atomic Energy Agency,
 and a r e l i s t e d i n Annex A o r Annex B t o the C o n v e n t i o n .
                                                       ARTICLE 6
                                 Ratifieation,          acceptance o r a p p r o v a l
                    T h i s P r o t o c o l s h a l l be s u b j e c t t o r a t i f i c a t i o n , acceptance
or    a p p r o v a l by each s i g n a t o r y Government i n accordance w i t h i t s
respective c o n s t i t u t i o n a l procedures.                   Instruments o f r a t i f i c a t i o n ,
acceptance o r a p p r o v a l s h a l l be d e p o s i t e d w i t h the Government o f the
U n i t e d S t a t e s o f America not l a t e r            than 30 June 1983,                except t h a t the
C o u n c i l may       g r a n t :>ne o r more e x t e n s i o n s o f time to any                signatory
Government t h a t has n o t d e p o s i t e d i t s i n s t r u m e n t o f r a t i f i c a t i o n ,
acceptance o r a p p r o v a l by t h a t date
 ---pagebreak---                                                               - 4 -
                                                        ARTICLE 7
                                                        Accession
 (1)              T h i s P r o t o c o l s h a l l be open f o r a c c e s s i o n
           (a)    until       30 J u n e 1983 b y t h e G o v e r n m e n t o f a n y member
                  listed        i n Annex A o r B t o t h e C o n v e n t i o n             as o f t h a t
                  date,       except       t h a t t h e C o u n c i l may     grant      one o r more
                  extensions o f time                 t o any Government t h a t has n o t
                  deposited          i t s instrument           by t h a t date,        and
           (b)    after       30 J u n e 1983 b y t h e G o v e r n m e n t o f any member o f
                  the United Nations,                   of i t s s p e c i a l i z e d agencies       or of
                  the     I n t e r n a t i o n a l A t o m i c E n e r g y Agency, upon         such
                  c o n d i t i o n s as the C o u n c i l c o n s i d e r s a p p r o p r i a t e by
                  not     l e s s than       two t h i r d s o f t h e v o t e s      c a s t by
                  e x p o r t i n g members a n d t w o t h i r d s o f t h e v o t e s           c a s t by
                  i m p o r t i n g members.
 (2)              Accession          s h a l l be e f f e c t e d by t h e d e p o s i t o f an          instrument
o f a c c e s s i o n w i t h t h e Government o f t h e U n i t e d S t a t e s o f A m e r i c a .
 (3)              Where, f o r t h e p u r p o s e s o f t h e o p e r a t i o n o f t h e             Convention
and     this Protocol, reference                      i s made t o members l i s t e d           i n Annex A o r
B t o the Convention,                  a n y member t h e G o v e r n m e n t o f w h i c h h a s a c c e d e d
to the Convention                 on c o n d i t i o n s p r e s c r i b e d b y t h e C o u n c i l , o r t o t h i s
P r o t o c o l i n accordance with paragraph                         (1)(b) o f t h i s A r t i c l e ,    shall
b e deemed t o b e l i s t e d             i n t h e a p p r o p r i a t e Annex.
 ---pagebreak---                                                                - 5 -
                                                        ARTICLE          8
                                          Provisional              application
                    Any s i g n a t o r y  G o v e r n m e n t may d e p o s i t w i t h        t h e Government o f
  the    United States o f America a d e c l a r a t i o n                      of provisional            application
 of    this Protocol.              Any o t h e r Government e l i g i b l e                 t o sign    this
 Protocol          o r whose a p p l i c a t i o n      f o r a c c e s s i o n i s approved by t h e
 Council         may a l s o d e p o s i t w i t h      t h e Government o f t h e U n i t e d S t a t e s o f
 America a declaration                  of provisional application.                            Any Government
 depositing           such a d e c l a r a t i o n      s h a l l p r o v i s i o n a l l y apply t h i s    Protocol
 and    be p r o v i s i o n a l l y regarded as a p a r t y                 thereto.
                                                       ARTICLE 9
                                                 Entry into              force
 (1)                This Protocol          shall       enter into force                on 1 J u l y    1983 i f , b y
 30 J u n e 1 9 8 3 , G o v e r n m e n t s r e p r e s e n t i n g      exporting         members w h i c h    held
at    l e a s t 60 p e r c e n t o f t h e v o t e s s e t o u t i n Annex A and                        representing
i m p o r t i n g members w h i c h h e l d          a t l e a s t 50 p e r c e n t o f t h e v o t e s s e t
out     i n A n n e x B, o r w o u l d h a v e h e l d           s u c h v o t e s on 30 J u n e 1983 i f t h e y
had     been p a r t i e s    t o t h e C o n v e n t i o n on t h a t         d a t e , have d e p o s i t e d
instruments o f r a t i f i c a t i o n ,            acceptance, approval or accession, o r
declarations           of provisional              a p p l i c a t i o n , i n accordance            with
Articles          6, 7 a n d 8 o f t h i s          Protocol.
 (2)               I f this Protocol            does n o t e n t e r i n t o f o r c e           i n accordance
with     paragraph         (1) o f t h i s A r t i c l e ,         t h e Governments which              have
deposited instruments of r a t i f i c a t i o n ,                       acceptance, approval or
accession, or declarations                      o f p r o v i s i o n a l a p p l i c a t i o n , may d e c i d e b y
mutual consent that                 i t s h a l l enter into force                  among t h o s e G o v e r n m e n t s
            v  r
that     ba . e d e p o s i t e d i n s t r u m e n t s o f r a t i f i c a t i o n ,     acceptance,       approval
or a c c e s s i o n , o r d e c l a r a t i o n s    of provisional               application.
 ---pagebreak---                                                                  - 6    -
                                                          ARTICLE         10
                               N o t i f i c a t i o n by d e p o s i t a r y      Government
                     The   Government of the U n i t e d                   States       o f America as         the
 depositary            Government s h a l l n o t i f y a l l s i g n a t o r y               and  acceding
 Governments o f each s i g n a t u r e ,                   ratification,             acceptance,          approval,
 p r o v i s i o n a l a p p l i c a t i o n o f , and        accession         t o , t h i s P r o t o c o l as   well
 as o f e a c h n o t i f i c a t i o n and           n o t i c e r e c e i v e d under A r t i c l e       27 o f   the
 C o n v e n t i o n and    each d e c l a r a t i o n and          n o t i f i c a t i o n received        under
 Article         28 o f t h e      Convention.
                                                         ARTICLE         11
                                      Certified          copy o f the           Protocol
                    As   soon as p o s s i b l e a f t e r t h e           entry       i n t o force of       this
P r o t o c o l , the d e p o s i t a r y      Government s h a l l            send a c e r t i f i e d copy        of
t h i s P r o t o c o l i n the        E n g l i s h , F r e n c h , R u s s i a n and        Spanish      languages
t o the       Secretary-General                of the United              Nations for r e g i s t r a t i o n i n
accordance with A r t i c l e                 102    of the Charter              o f the      United      Nations.
Any     amendments t o t h i s P r o t o c o l s h a l l               l i k e w i s e be      communicated.
 ---pagebreak---                                                                 - 7 -
                                                           A R T I C L E 12
                                  R e l a t i o n s h i p o f Preamble t o P r o t o c o l
                    T h i s P r o t o c o l i n c l u d e s t h e P r e a m b l e t o t h e 1983 P r o t o c o l s
f o r t h e f u r t h e r e x t e n s i o n o f t h e Wheat T r a d e C o n v e n t i o n ,                  1971 a n d
the Food A i d C o n v e n t i o n ,               1 9 8 0 , c o n s t i t u t i n g t h e I n t e r n a t i o n a l Wheat
Agreement, 1971.
                     I N WITNESS WHEREOF t h e u n d e r s i g n e d ,                      having      been   duly
 a u t h o r i z e d t o t h i s e f f e c t by t h e i r r e s p e c t i v e Governments o r
 a u t h o r i t i e s , have s i g n e d          t h i s P r o t o c o l on t h e d a t e s           appearing
 opposite          their        signatures.
                     The      t e x t s of t h i s P r o t o c o l i n the E n g l i s h , French,                   Russian
 and     Spanish          l a n g u a g e s s h a l l be e q u a l l y a u t h e n t i c .           The   originals
 s h a l l be d e p o s i t e d w i t h t h e Government o f t h e U n i t e d S t a t e s o f
 America, which s h a l l transmit c e r t i f i e d                             c o p i e s t h e r e o f t o each
  s i g n a t o r y and acceding                p a r t y and t o the E x e c u t i v e            Secretary of the
  Council.
 ---pagebreak---                          1983      PROTOCOL FOR THE FURTHER                      EXTENSION OF
                                     THE FOOD A I D CONVENTION,                    1980
The    parties to this                Protocol,
Considering           t h a t t h e Food A i d Convention,                     1980 ( h e r e i n a f t e r r e f e r r e d
         to as "the Convention")                        o f t h e I n t e r n a t i o n a l Wheat A g r e e m e n t ,
          1 9 7 1 , w h i c h was e x t e n d e d b y P r o t o c o l          i n 1981, e x p i r e s     on
          30 J u n e 1 9 8 3 ,
Have a g r e e d a s f o l l o w s :
                                                          ARTICLE I
                   Extension,          e x p i r y and t e r m i n a t i o n     o f the Convention
                    Subject to the provisions of A r t i c l e                           I I of this       Protocol,
 the Convention               shall      c o n t i n u e i n f o r c e between t h e p a r t i e s t o t h i s
 Protocol until               30 J u n e 1986 p r o v i d e d         t h a t , i f a new       agreement
 covering          food a i d enters              i n t o f o r c e b e f o r e 30 J u n e 1 9 8 6 , t h i s
 Protocol shall               remain        i n force only          u n t i l the date of entry               into
 f o r c e o f t h e new          agreement.
                                                           ARTICLE I I
                               Inoperative            provisions o f the Convention
                     The     f o l l o w i n g p r o v i s i o n s o f t h e C o n v e n t i o n s h a l l b e deemed
  t o be i n o p e r a t i v e w i t h         e f f e c t from     1 J u l y 1983:
             (a)     Article XII
             (b)     Article         XVII
              (c)    paragraph            (1) o f A r t i c l e     XVIII.
 ---pagebreak---                                                     - 2 -
                                              ARTICLE I I I
                                    I n t e r n a t i o n a l food a i d
                For   the purposes o f the operation o f the Convention as
 extended by t h i s        Protocol,    a n y member w h i c h h a s a c c e d e d t o t h i s
 Protocol      pursuant t o paragraph             (2) o f A r t i c l e V I I I of this       Protocol
 s h a l l b e deemed t o b e l i s t e d    i n paragraph          (3) o f A r t i c l e I I Iof the
Convention, together with              i t s minimum c o n t r i b u t i o n    as determined
 under t h e r e l e v a n t  provisions       of Article VIII of this                 Protocol.
                                               ARTICLE IV
                                               Signature
                This Protocol      shall       be open f o r s i g n a t u r e i n Washington
from 4 A p r i l    1983 u n t i l a n d i n c l u d i n g 10 May 1983 b y t h e G o v e r n m e n t s
referred t o i n paragraph           (3) o f A r t i c l e      I I Iof the Convention.
                                              ARTICLE V
                                              Depositary
               The Government o f t h e U n i t e d S t a t e s o f A m e r i c a s h a l l be t h e
depositary of this            Protocol.
 ---pagebreak---                                                                - 3 -
                                                         ARTICLE V I
                                   Ratification,           acceptance o r         approval
                     This      P r o t o c o l s h a l l be s u b j e c t to ratification,             acceptance
 or approval             by each s i g n a t o r y Government i n a c c o r d a n c e w i t h i t s
 c o n s t i t u t i o n a l procedures.               Instruments of r a t i f i c a t i o n ,       acceptance
 or approval             s h a l l be d e p o s i t e d   with the depositary                not later       than
 30 J u n e 1983, e x c e p t t h a t t h e Pood A i d Committee u n d e r t h e C o n v e n t i o n
 ( h e r e i n a f t e r r e f e r r e d t o a s " t h e C o m m i t t e e " ) may       g r a n t one o r more
 extensions            o f t i m e t o any s i g n a t o r y Government t h a t has n o t                  deposited
 its     instrument of r a t i f i c a t i o n , acceptance or approval                            by t h a t  date.
                                                        ARTICLE V I I
                                              Provisional application
                    A n y s i g n a t o r y G o v e r n m e n t may d e p o s i t w i t h t h e d e p o s i t a r y a
declaration of provisional application of this Protocol.                                              Any     such
Government s h a l l p r o v i s i o n a l l y a p p l y           this   P r o t o c o l a n d be
p r o v i s i o n a l l y regarded as a p a r t y               thereto.
 ---pagebreak---                                                              - 4
                                                      ARTICLE      VIII
                                                        Accession
 (1)              This    P r o t o c o l s h a l l be open f o r a c c e s s i o n            by any Government
r e f e r r e d t o i n paragraph              (3) o f A r t i c l e    I I I of the Convention                that
has     not signed        this      Protocol.             Instruments o f accession                    shall   be
deposited         with    the depositary                not later       t h a n 30 J u n e 1983, e x c e p t
t h a t t h e C o m m i t t e e may g r a n t o n e o r more e x t e n s i o n s               o f t i m e t o any
Government t h a t has n o t d e p o s i t e d                i t s instrument of accession                   by  that
date.
 (2)              Once t h i s      P r o t o c o l has entered           into     force i n accordance
with A r t i c l e     IX o f t h i s       P r o t o c o l , i t s h a l l be open f o r a c c e s s i o n       by
any    Government o t h e r           than those r e f e r r e d t o i n paragraph                       (3) o f
Article        I I I o f t h e C o n v e n t i o n , upon s u c h c o n d i t i o n s a s t h e Committee
considers         appropriate.              Instruments o f accession                    s h a l l be     deposited
with      the    depositary.
(3)               Any Government a c c e d i n g t o t h i s               P r o t o c o l under paragraph
(I)    or paragraph           (2) o f t h i s A r t i c l e may           deposit with             the    depositary
a declaration of provisional application of this                                         P r o t o c o l pending the
deposit        of i t s instrument of accession.                          Any such Government                shall
provisionally           apply      this       P r o t o c o l and be p r o v i s i o n a l l y       regarded as a
party       thereto.
 ---pagebreak---                                                              - 5 -
                                                        ARTICLE IX
                                                    Entry    Into       force
  (1)                This Protocol s h a l l enter                 i n t o f o r c e on 1 J u l y 1983, i f by
  30 J u n e 1 9 8 3 t h e G o v e r n m e n t s r e f e r r e d t o i n p a r a g r a p h          (3) o f
 Article         I I I o f t h e C o n v e n t i o n have d e p o s i t e d        instruments of
 ratification,             acceptance, approval                 or accession,             or declarations of
 p r o v i s i o n a l a p p l i c a t i o n , and p r o v i d e d    t h a t t h e 1983 P r o t o c o l     f o r the
  further extension                o f t h e Wheat T r a d e C o n v e n t i o n , 1 9 7 1 , o r a new Wheat
 Trade Convention r e p l a c i n g i t ,                i s i n force.
  (2)                I f t h i s P r o t o c o l does n o t enter            i n t o force i n accordance
 with paragraph               (1) o f t h i s A r t i c l e ,     t h e Governments which               have
 deposited           instruments of r a t i f i c a t i o n ,           acceptance, approval               or
 accession,           o r d e c l a r a t i o n s o f p r o v i s i o n a l a p p l i c a t i o n , may d e c i d e b y
 unanimous c o n s e n t t h a t i t s h a l l e n t e r              i n t o f o r c e among       themselves
 provided         t h a t t h e 1983 P r o t o c o l f o r t h e f u r t h e r e x t e n s i o n       of the
 Wheat T r a d e C o n v e n t i o n , 1 9 7 1 , o r a new Wheat T r a d e C o n v e n t i o n
 replacing i t ,          i s i n f o r c e , o r may t a k e w h a t e v e r o t h e r            action   they
 consider         the situation             requires.
                                                       ARTICLE X
                                                      Duration
                   This     P r o t o c o l s h a l l remain i n f o r c e u n t i l and i n c l u d i n g
30 J u n e 1986, p r o v i d e d           t h a t t h e 1983 P r o t o c o l      f o r the further
extension          o f t h e Wheat T r a d e C o n v e n t i o n , 1 9 7 1 , o r a new Wheat T r a d e
Convention replacing i t ,                     remains i n f o r c e u n t i l and i n c l u d i n g         that
date.
 ---pagebreak---                                                              - 6 -
                                                           ARTICLE XI
                                                       Authentic          texts
                    The t e x t s o f t h i s P r o t o c o l i n t h e E n g l i s h , F r e n c h , R u s s i a n
and     Spanish languages s h a l l a l l be e q u a l l y a u t h e n t i c .                         The o r i g i n a l s
s h a l l be d e p o s i t e d       i n the archives o f the d e p o s i t a r y ,                  which s h a l l
transmit          c e r t i f i e d c o p i e s t h e r e o f t o each s i g n a t o r y and a c c e d i n g
Government.
                                                          ARTICLE X I I
                                  R e l a t i o n s h i p o f Preamble t o P r o t o c o l
                     T h i s P r o t o c o l i n c l u d e s t h e Preamble t o t h e 1 9 8 3 P r o t o c o l s
 for the further extension                          o f t h e Wheat Trade C o n v e n t i o n , 1 9 7 1 and t h e
 Food A i d C o n v e n t i o n , 1 9 8 0 , c o n s t i t u t i n g          t h e I n t e r n a t i o n a l Wheat
 Agreement, 1 9 7 1 .
                      IN WITNESS WHEREOF the u n d e r s i g n e d , having                          been d u l y
  a u t h o r i z e d t o t h i s e f f e c t by t h e i r r e s p e c t i v e Governments o r
  authorities,              have s i g n e d        t h i s P r o t o c o l on t h e d a t e s       appearing
  opposite          their       signatures.


title: Recommendation for a COUNCIL DECISION authorizing the Commission to open negotiations with Bangladesh and India with a view to concluding agreements on trade and commercial cooperation in jute products (submitted to the Council by the Commission)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (79) 402
Vol. 1979/0143
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
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file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
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(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                                COM(79 ) 402 final
                                                                Brussels / 18 July 1979
                                                       f >•
                                                          - V? .
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                                                 • A J
                                  v -          ^
                                Recommendation for a
                                   COUNCIL DECISION
         authorizing the Commission to open negotiations with Bangladesh
            and India with a view to concluding agreements on trade and
                       commercial cooperation in jute products
                   ( submitted to the Council by the Commission )
C 01*1(79 ) 402 final .
 ---pagebreak---                     EXPLANATORY MEMORANDUM
1.    The Community currently has agreements with both India and Bangladesh on
trade and commercial cooperation in jute products ;      these remain in force until
31 December of this year .    For these two countries , who are the principal Community
suppliers , the agreements constitute the " special arrangements" mentioned in the
context of the Community 's offer on generalized tariff preferences with a view
to giving developing countries the benefit of preferences for the products
         . . .1
in question .
Inter alia , the two agreements provide for :
-   the granting by the Community of autonomous , progressive tariff       suspensions ,
    resulting in zero duty from 1 January 1978 ;
-   voluntary restraint by India and Bangladesh , at agreed levels , of their
    exports of unbleached ( categories 4 / 5 ) and bleached ( category 7 ) jute fabrics
    of a width of more than 150 cm ;   the quantitative restrictions applying to
    those products in some of the Member States are suspended ;
-   maintenance of the quotas applied in Germany , France and the UK to other
    jute products ( narrow fabrics and sacks in categories 1 to 3 );      the volume
    of quotas in Germany and France allowing for annual increases in volume ;
-   one general and also one specific consultation clause , the latter allowing the
    Comm.unity , upon certain conditions , to ask its partners to exercise voluntary
    restraint on their exports of j ute yarn to the Community or any of its markets ;
-   the setting up of a Joint Cooperation Committee responsible inter alia for
    investigating possiblities for cooperation in regard to* research into and
    development of the production and uses of jute products .
  Thailand also enjoys tariff preferences on its exports of jute products . However ,
in view of the volume of its exports the Community felt able to grant preferences
without taking the sort of measures agreed upon with its main suppliers . There
was nevertheless an exchange of letters with Thailand to the effect that it would
enter into negotiations with the Community if necessary .
In accordance with that exchange of letters , consultations were heldvin December
1977 to reach agreement on voluntary restraint by Thailand of its exports of
jute yarn to the Benelux ; the voluntary restraint has effect until 31 December
of thi's year .
 ---pagebreak---  2.  The current agreements have worked more satisfactorily from the point of view
of the two exporting countries than previous agreements .
       a ) With regard to tariffs , duties , which were only 50% or 60% suspended in
1976 , have been completely suspended since 1 January 1978 . The Community agreed
to bring forward the total suspension of all duties six months from the       date
of 1 July 1978 specified in the agreements .
       b)  From the point of view of trade development , Bangladesh 's , and particularly
India 's exports of goods subject to voluntary restraint showed an improvement
in relation to the period covered by the old agreements , in particular for products
falling with ,in categories 4 / 5  .   Formerly only the United Kingdom share of the
Community ceiling was fully utilized each year .      In 1978 India 's exports to the
Benelux reached 65% of the quota , with 100% in the case of France and the UK ,
71% for Italy and 86% for Ireland .      As regards Bangladesh , exports to the UK
were satisfactory ( 100% of the quota ), as were those to the Benelux ( 74% ).       German
and Danish imports , on the other hand , were negligible in relation to the
possibilities open .    Both India 's and Bangladesh 's exports of decorative jute
fabrics ( category 7) were much less than they might have been .      Both countries
have made use every year of the transfer facility between categories included
in the agreements .
       Jute yarns ( category 6 )   are liberalised at Community level ;   they are ,
however , covered by a consultation clause which enables the Community , under
certain conditions , to ask for voluntary export restraint ( in the case of the
United Kingdom and Benelux consultations may be requested where " indicative levels "
are exceeded ).   In this sector , India 's exports to the whole Community grew by
                              2
400% between 1976 and 1978 .      This large increase is mainly due to India 's
Benelux trade . . In 1976 , Benelux imported 762 t , in 1977 3,128 t , while for
the first six months of 1978 imports had risen to 3,516 t^.
1
  Narrow jute fabrics and sacks ( categories 1 to 3 ) are not subject to voluntary
restraint . In Germany ( fabrics only ), France and the United Kingdom ( certain
sacks only ) they are however subject to national quotas . Bangladesh and Indian
exports of these products have also increased , and in France and the UK the quotas
are used up each year . It should be recalled that the Community h.is agreed that ,
as part of its MTN offer , these quotas shculd'-be converted into voluntary restraint
measures , the implementation of this undertaking to be discussed in detail in the
course of the negotiations ( see point 4 below ).
2
  It should be noted that total EEC imports of jute yarn ( predominantly from India ,
Bangladesh and Thailand ), which in 1978 came to 24,000 t , correspond to 23.5% of
EEC production ( 102,000 t in1978 ). The figure for 1976 was 7% .
    rise of this magnitude , concentrated on a single Community region , prompted a
request for consultations with India with a view to achieving voluntary restraint
of its jute yarn exports to Benelux .      Agreement was reached on voluntary^ restraint
+ n kp                   "*i December of this year ( 13,000 t for the period i .1 - 78-31 . 12 *
 ---pagebreak---                                        -   3  -
Nevertheless , while India and Bangladesh have increased their exports under the
current agreements , where products subject to voluntary restraint are concerned
the quantities involved remain beneath the ceilings , at Community level r        This
situation is doubtless more particularly due to a shrinking market for jute
products , caused by the growing use of synthetic substitutues and partly as
a result of changes in packaging techniques .       It is , however , true that , as
India and Bangladesh have repeatedly pointed out , the allocation of the
Community voluntary restraint ceilings among the Member States in the form of
virtually fixed shares , offering no real scope for the transfer of unutilized amounts
from one Member State to another , has resulted in a partial freeze on export
openings .
      c)   The results of the commercial cooperation provisions of the current
agreements have been modest .    In June 1977 , however , a round table was organized
under the Commission 's auspices , bringing together Community and Indian represent
atives   concerned with industry , trade and research in the field of jute products .
Among the conclusions reached by the round table was an acknowledgement of the
need for joint action on research and trade promotion , and a list of priority
projects .   It has not been possible yet , however , to put some of these^ projects
into effect ( financing ).
3.    The Community jute industry , which has been in the throes of rationalisation ,
reconversion and restructuring for a considerable time already , is still facing
grave difficulties in the form of falling production , factory closures and lay-offs .
In 1970 , Community production in the spinning and weaving sectors was 300,000
tonnes and 176,000 tonnes respectively , but in 1978 only 102,000 tonnes and
44,000 tonnes .    If the production index is set at 100 for 1970 , in 1978 it stood
at 34 for yarn and 25 for fabrics and sacks .      The general tendency has been for
apparent consumption of both fabrics and sacks to fall during the 12 years following
19£7.^ In the course of the last two years there has been a certain steadying of
the market , but it is too early to say whether this will be maintained .          What is
certain is that the corresponding decline in European production , accompanied
by a growth in imports , has resulted in a major rise in the level of import
penetration .   This reached 81% for fabrics and sacks in 1978 .
  For yarn : 1967 : 362,000 tonnes , 1970 : 301,000 tonnes , 1978 ; 122,000 tonnes .
  For fabrics and sacks : 1967 : 342,000 tonnes , 1970:267,000 tonnes , 1978 : 142,000
                            tonnes .
 ---pagebreak---                                           - 4  -
      It should be noted , however , that only one quarter ( 29,500 ) of the total
quantity cf fabrics and s.acks imported in 1978 is limited under agreements or
nationally established ceilings , the remainder being free .
      It cannot be ruled out that the confirmation of consumer tastes in favour of
natural products for certain uses ,     the lower flamability of jute compared with
certain competing synthetic substitute products , and the likely
price increase for these latter products following a rise in petroleum prices ,
may maintain or even enhance Community demand for certain more refined products
such as those used in soft furnishings and decoration .
      The drop in Community production can be explained by the contraction of the
market , which is more marked each year and caused principally by the ever-greater
use of synthetic substitutes for jute , and new means of packaging ;      and is also
a reflection of the difficulty of maintain       sufficiently competitive mass production
in the c?se of the much lower production costs in India and Bangladesh .
      The Community 's jute industry employed some 13,000 people in 1978 , compared with
19,000 in 1973 .  This represents a reduction of approximately31.5%       In 1973
77 firms were in operation ;   in 1978 , only 56 remained .
      The industry is located in relatively undeveloped Community regions .       8,000
of the 13,000 jobs in the Community 's industry are concentrated in Dundee in Scotland ,
where they constitute 8% of all employment in an area where the rate of unemployment
in February 1979 was 9.3% of the workforce .
      Despite the fact that these regions are considered as priority development
areas , and as a result benefit from the Regional Development Fund , the level of
unemployment remains high because the opportunities for providing alternative
employment are very low .   It is therefore likely that a continued decline in
activity in the jute industry will increase those difficulties which are being
currently experienced .   In addition to this , if opportunities for transfers to
other jobs were to be made available , the age structure of the employees in
the jute sector would give rise to problems , because the majority of workers
are aged between 40 and 50 .
      It must also be borne in mind that the three countries preparing to join
the EEC also have a jute industry, employing 600 people in Greece , 1,100 in Spain
and 1,200 in Portugal , with a production      of some 27,000 tonnes of yarn and
16,000 tonnes of fabric .
                            *
 ---pagebreak---                                      -   5 -
4.   The present agreements are due to expire on 31 December , and it is therefore
necessary to . work out the arrangements for Imports of these products from
1 January 1980 .   In the Light of the various factors , the Commission considers
it advisable to aim , by means of fresh agreements with India and Bangladesh , for
a system consisting of :
      i ) continuing quantitative import protection for a given period to allow
          the Community jute industry to adapt itself to the new market circumstances .
          This aim should be achieved with the consent of the exporting countries
          concerned by keeping up a system of voluntary restraint of exports(2 )
          to the Community allowing for a limited growth of these exports , and
          providing for the suspension of restrictions for all jute products before
          the expiry of the agreements .
          The implementation of the MTN offer to convert quotas in force in certain
          Member States for categories 1 to 3 into voluntary restraint measures ( 2 )
          would take place within this framework .
    ii ) Maintaining the zero rates of duty in force under GSP since 1 January 1978 .
     The grounds for this approach are as follows :
a)  With regard to tariffs , the Community 's basic offer on preferences ( GSP ) for
    jute " includes the elimination of customs duties only where special arrangements
    have- been made with the developing exporting countries".      The duties have
    now been eliminated and should not be reintroduced .
b)  In the case of the two exporting countries concerned , the export of jute
    products plays an importance part in India ' s    economy , being concentrated in
    the Bengal region which is largely devoid of other resources ( about 20 000
    are employed in the jute industry ).    Fo r Bangladesh the production and export
    of jute products constitute the key to the country 's economy , accounting for
    70% of its export earnings .
(1)  The arrangement with Thailand for voluntary restraint on its exports of jute
     yarn also expires on 31 December .                                  \___
     However , since this was an ad hoc economic measure adopted within the
     framework of an exchange of letters which remains in force , the Commission
      services consider it advisable to deal separately with this point . Whether
     or not to continue with voluntary restraint will need to be considered in the
      light of the situation on the Benelux market for these products and of the
      results of the negotiations with India and Bangladesh .
(2)  With a double control system used in the framework of the MFA agreements .
 ---pagebreak---                                              -6     _
   Bangladesh is , in addition , one of the " Least developed countries " which , in
    accordance with the results of the Muli lateral Trade Negotiations / are to be
    granted special treatment .
c)In the course of the Multilateral negotiations Bangladesh repeatedly drew the
    Community 's attention to the fact that in its case , special treatment would
    have necessarily to consist of measures in the jute sector , and detailed
   proposals were put forward ( in particular , the       removal of Community import
    restrictions at the end of 1981 ).
    In this context , the Community 's MTN offer to India and Bangladesh on jute products ,
   being again the subject of national quotas ,       ( categories 1 to 3 ), and as a
   move towards the elimination of quantitative restrictions , was to convert these
    import quotas in force in certain Member States ( Germany , France and the United
   Kingdom ) into voluntary export restraint measures as for the other jute products
    covered by these agreements , with the exporting country administering the
              1
    ceilings .
   At the end of the Mul lateral Trade Negotiations , no further reaction having
   been forthcoming from India or Bangladesh , the Community agreed to send a
    letter to both countries , informing them :
                - that the Community was maintaining its offer ;
                - that the details and implementation of the offer would be discussed
                  again on a bilateral basis at the next negotiations .
   On the basis of the Tokyo Declaration generally , but in particular of its
    sixth paragraph which states that the least developed countries should enjoy
    special treatment , it would be logical to grant such treatment to Bangladesh
   particularly since jute products indisputably constitute a production essential
   to this country .
    1
      The initial reactions to this offer were as follows :      India called for
     liberalisation of the products in question ( categories 1 to 3 ), or at least
    for the new agreement tc contain consultation Levels rather than ceilings ,
    as is currently the case of yarn ; Bang ladesh again stressed the need for
    " spec 'si treatment " as a " Uast developed " country .
 ---pagebreak---                                     -  7  -
      In view of this declaration , and taking into account the less competitive
      nature of certain jute products made in Bangladesh in comparison with certain
      of those made in India , it is essential that the solutions envisaged by the
      Community in the negotiations do not in practise , damage the interest of
      Bangladesh .
      However , in implementing the offer made in the MTN , it would not be opportune
      to treat Bangladesh and India differently and to change the quantitative
      restrictions into self limiting arrangements for one country and not for the
      other .
d)    Within the context of the renegotiation of the jute agreements with India
      and Bangladesh , the Community envisages an analogous renewal of the protection
      for the Community market ( with a suspension of restrictions before the end
      of the agreements ) to allow the jute industry enough time to carry out its
      adjustment to market conditions and the member States to tackle the serious
      problems currently facing the Community 's depressed regions where this industry
      is located .               .
5.    In order to avoid additional difficulties arising at the end of the agreement ,
which would exacerbate the problems of the regions concerned , the Commission
considers that it will be important to encourage work on the restructuring of this
sector as well as the development of alternative employment opportunities .
      In this respect , socio-industrial measures will have to be considered in order
to facilitate reconversion activities for the jute industry , to create new
employment in the jute-producing regions , and to retrain the labour force to
enable them to work in other sectors .
                                                                         To th i s
end , discussions should be held between interested groups and the responsible
authorities in order to draw up the general outline for this approach .ι
      The Community have at its disposal financial   instruments which could
facilitate the introduction of such measures, notably :
 ---pagebreak---                                          -8     -
-   The European Social Fund :    this can , from now onwards , facilitate the
    readaptation and the redeployment of workers in the jute industry by financing
                                                              1
    vocational training schemes under Decision 76/ 206/ EEC     on intervention by the
    European Social Fund in favour of persons occupied in the textile and clothing
    industries .
" The European Regional Development Fund :        the Fund couLd intervene in the eligible
    regions , notably in the Dundee area by way of its " subject to quota " section .
    The economic problems which would result from the Community negotiations between
    India and Bangladesh would also enable the " not subject to quota " section of the
    FEDER to be used .
      The Commission considers it desirable that .the Council , when it adapts
this Recommendation , should indicate its interest in such measures by means of the
statement shown in Annex II which would be included in the Minutes of the Council 's
deliberations .
6.    There exists , on the one hand , the need for the Community to regulate ,
on the basis of the lines indicated and the considerations laid down , the
trade arrangements for jute products ; and on the other hand , for understandable
reasons , it is appropriate doing so by measures which are non-uni lateraU          It is
also desirable for the Community to take a step forward towards meeting , at least
in part , the requests of India and Bangladesh .     It is further desirable that con
ditions be created which enable these negotiations to have a likelihood of success .
It is necessary , however , to take into account the need to allow the European
jute industry , which is located in regions which are economically weak , to adapt
to new market conditions .     It seems appropriate that the approach towards such
negotiations should envisage , under a contractual arrangement , a system of self-
limitation on exports , analogous in its major outlines , to that currently in
force and the fixing , before the end of the year , of agreements suspending all
restrictions .
The Commission therefore recommends that the Council adopt the annexed draft
Decision .
  O.J. No L 39 / 39 of 14.1.1976 ; modified by Decision 77/ 802 / CEE  ( O.J. No L 337
of 27.10.1977 , p. 100 ).
 ---pagebreak---                       RECOMMENDATION FOR A COUNCIL DECISION
                             *
         authorizing the Commission to open negotiations with
         Bangladesh and India with a view to concluding agreements
         on trade and commercial cooperation in jute products
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community , and
in particular Article 113 thereof ,
Having regard to the recommendation from the Commission ,
Whereas the Community 's offer on generalized tariff preferences provides that the
elimination of customs duties should also be envisaged for jut6 products
" where special arrangements have been made with the developing exporting countries ";
Whereas the European Economic Community has negotiated agreements on trade in jute
products , which constitute such " special arrangements", with the Republic of
India , and with the People 's Republic of Bangladesh ;  whfereas the said agreements
expire on 31 December 1979 ;
Whereas it is desirable to authorize the opening of negotiations with India and
Bangladesh with a view to determining the arrangements to be applicable after
that date to trade in jute products ;
HAS DECIDED AS FOLLOWS' :
                                         Sole Article
The Community is hereby authorized to open negotiations for the conclusion of
agreements between the European Economic Community and , on the one hand , the •
Republic of India    and,on the other , the People 's Republic of Bangladesh ,
on trade and commercial cooperation in jute products .
The Commission shall conduct the negotiations in consultation with the Special
Committee provided for in Article 113 of the Treaty and in accordance with the
directives contained in the Annex to this Decision .
                                                              For the Counci l
Done at
 ---pagebreak---                                                                 ANNEX I
                        NEGOTIATING DIRECTIVES
1.  Agreement to be valid for six years , i.e. until 31 December 1985 .
2. India and Bangladesh to exercise voluntary restraint on their exports to
   the Community of jute products falling within categories 1 to 3 , 4,5 and
   7 , until 31 December 1984 .   The voluntary restraint to take the following
   form :
   - for categories 4 / 5 and 7 , Community ceilings based on those in force
      in 1979 , with a suitable annual percentage increase ;
   - for categories 1 to 3 , ceilings for some Member States only , based on
      existing national quotas or on imports , where such quotas are expressed
      in terms of value or constitute global quotas , with a suitable annual
      percentage increase .                                             '
3.   Suspension , as from 1 January 1985 , of all the quantitative restrictions
     in force in the Community .
4.   Arrangements concerning       flexibility ( between quota shares of the Member
     States and between quota shares of one Wember State ;    carry-forward and
     advanced deliveries ) analogous to those fixed in the current agreements .
5.   The consultation clause in force for jute yarns ( category 6 ) under the
     present agreements to be maintained .
6.   The zero-duty tariff* suspension applied under the GSP to be maintained .
 ---pagebreak---                                                            ANNEX II
          Declaration to be inserted in the Council 's Minutes
       The Council considers it advisable to encourage the continuation
of the restructuring of the jute sector together with , in the poorer of
the regions concerned , the creation and development of new activities ..
       It will examine favourably all such Community action as the
Commission considers it necessary to propose to this end .