title: Recommendation for a COUNCIL DECISION on the conclusion of a protocol laying down the conditions and procedures for the implementation of the second stage of the Agreement establishing an Association between the European Economic Community and the Republic of Cyprus and adapting certain provisions of the Agreement (presented by the Commission)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (87) 419
Vol. 1987/0221
 ---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) modifié en dernier
lieu par le règlement (UE) 2015/496 du Conseil du 17 mars 2015 (JO L79 du 25. 3.2015, 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 ou sont considérés déclassifiés
conformément aux articles 26(3) et 59(2) de la décision (UE, Euratom) 2015/444 de la
Commission du 13 mars 2015 concernant les règles de sécurité aux fins de la protection des
informations classifiées de l'Union européenne.
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 last amended by Council
Regulation (EU) 2015/496 of 17 March 2015 (OJ L 79, 27.3.2015, 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 or are considered declassified in conformity with
Articles (26.3) and 59(2) of the Commission Decision (EU, Euratom) 2015/444 of 13 March 2015
on the security rules for protecting EU classified information.
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), zuletzt geändert durch die
Verordnung (EU) Nr. 2015/496 vom 17. März 2015 (ABI. L 79 vom 25.3.2015, S. 1), ist dieser Akt
der Öffentlichkeit zugänglich. Soweit erforderlich, wurden die Verschlusssachen in diesem Akt in
Übereinstimmung mit Artikel 5 der genannten Verordnung freigegeben; beziehungsweise werden
sie auf Grundlage von Artikel 26(3) und 59(2) der Entscheidung der Kommission (EU, Euratom)
2015/444 vom      13.   März 2015     über die   Sicherheitsvorschriften für den Schutz von  EU-
Verschlusssachen als herabgestuft angesehen.
 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                                COM(87 ) 419 final
                                                Brussels , 31 August 1987
                               Recommendation for a
                                 COUNCIL DECISION
        on the conclusion of a protocol laying down the conditions and
         procedures for the implementation of the second stage of the
              Agreement establishing an Association between the
            European Economic Community and the Republic of Cyprus
               and adapting certain provisions of the Agreement
                         ( presented by the Commission )
                                                           ^ /“ Sj
                                                              r-
                                                             4'
                                      oi      ■   . S'!'-"   .c
C0MC87 ) 419 final
                                       &
 ---pagebreak---  1.         At its meeting on 25 November 1985 , the Council adopted negotiating
 directives authorizing the Commission to open negotiations with the Republic
 of Cyprus with a view to concluding a Protocol laying down the conditions
 and procedures for the implementation of Article 2 ( 3 ) of the EEC-Cyprus Association
 Agreement oh the establishment of a customs union and adapting the Agreement
 to take account of the enlargement of the Community .
                                                                      tr
 2.         On the 21-22 October 1986 , the Council decided negotiating directives
 complementary to those of 25 November 1985 . Given the complex nature of the
 negotiations with Cyprus for a customs union , a margin of flexibility was
 allowed , in particular with regard to Cypriot requests for additional protection
 for certain sensitive sectors during the first 10 years phase of the customs
 union .
 3.        On the basis of these negotiating directives , there were five
 rounds of negotiations between the Community and Cyprus between December
 1985 and May 1987 . The Heads of the respective Delegations initialled
the draft of the protocol and annexes together with the Final Act , containing
the declarations and exchange of letters , that form an integral part of this
Protocol , on the 22 May 1987 .
4.         The Protocol and Final Act conforms entirely to the Council directives
as regards the agricultural concessions granted by the Community to Cyprus .
However , during the negotiations , the Cypriot delegation stressed the unsatisfac ¬
tory nature of the concessions granted by the Community in view of the importance
of the agricultural sector for the Cypriot economy and in view of the nature
of the new Protocol which , unlike the other Mediterranean Agreement , entails
substantial concessions by Cyprus to the Community .
             The Cypriot delegation wished to have
- improvements in the calendar for table grapes , artichokes and kiwi fruit
- tariff concessions on bananas , grape juice ( 20.07 A I ) and canned grapes
    ( seedless );
- an annual increase of 5 % on the tariff quota for bulk wine of fresh grapes ;
- and a reduction of the levy on Halloumi cheese
and set this out inaletter from the Head of the Cypriot Delegation to the
Community negotiator . The Commission is of the opinion that these requests
need further study before it takes a position .
5.         As regards the level of protection for sensitive sectors , in both
Cypriot industry and agriculture during the first 10 year phase of the
customs union , the Cypriot delegation obtained almost full satisfaction from the
Community . Nevertheless , the Community was able to achieve its main objective
of ensuring that by the end of the first phase virtually all the obstacles to trade
both      tariff and quantitative , between the Community and Cyprus will have
been abolished .
 ---pagebreak---                                           3
 6.        The Commission would like to draw particular attention to the Joint
 Declaration concerning rules of origin in the Final Act and in particular
 the commitment by the Community to examine the Cypriot request for derogations ( four
 Nimexe posit ions)under headings 61.02 and 61.03 and to take a decision within
three months of the entry into force of this Protocol on this request .
7.        The Commission recommends to the Council that it approve this protocol
and implement the procedure for signing and concluding .
          It therefore submits :
- recommendation for decision by the Council on the conclusion of the
    protocol to the Association Agreement between the European Economic
    Community and the Republic of Cyprus ;
- the initialled draft of the protocol with its annexes ;
- the Final Act , declarations and exchange of letters annexed thereto .
 ---pagebreak---                                      RECOMMENDATION
                                FOR A COUNCIL DECISION
                           cn the conclusion of a protocol
          laying down the conditions and procedures for the implementation
                 of the second stage of the Agreement establishing
           an Association between the European Economic Community and the
                 Republic of Cyprus and adapting certain provisions
                                   of the Agreement
   THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
  Having regard to the Treaty establishing the European Economic Community , and
   in particular Article 238 thereof ,
  Having regard to the recommendation from the Commission ,
 Having regard to the assent of the European Parliament ,
Whereas it is necessary to approve the protocol laying down the conditions and
procedures for the implementation of the second stage of the Agreement establishing
an Association between the European Economic Community and the Republic of Cyprus ,
and adapting certain provisions of the Agreement signed at Brussels on 19 December
1972 ( 1 ),*
  HAS DECIDED AS FOLLOWS :
                                          Article 1
  The Protocol laying down the conditions and procedures for the implementation of
  the second stage o * the Agreement establishing an Association between the
  European Economic Community and the Republic of Cyprus and adapting certain pro¬
  visions of the Agreement , the Annexes and the Final Act and declarations and
  exchange of letters annexed thereto      are hereby approved on behalf of the Community .
  The texts of the Protocol and of the Final Act are attached to this Decision
                                          Article 2
 The President of the Council shall give the notification provided for in
  Article 36 of the Protocol ( 2 ).
 ( 1 ) O.J. N° L 133 , 21.5.1973 , p.2
 ( 2 ) The date of entry into force of the Protocol will be published in the Official
       Journal of the European Communities by the General Secretariat of the Council .
 ---pagebreak---                              Art i c le 3
This Decision shall take effect on the day following its publication in the
Official Journal cf the European Communities .
Done at Brussels ,
                                               For the Counci l
                                                The President
 ---pagebreak---                                    A
                                              May 22 1987
                            PROTOCOL
   laying down the conditions and procedures for the implementation
   of the second stage of the Agreement establishing an Association
  between the European Economic Community and the Republic of Cyprus ,
           and adapting certain provisions of the Agreement
O
 ---pagebreak---                                       ΛΑ
 THE EUROPEAN ECONOMIC COMMUNITY of the one part
and
THE REPUBLIC OF CYPRUS of the other part ,
Having regard to the Association Agreement between the European
Economic Conmunity and the Republic of Cyprus signed at Brussels on
19th December 1972 , hereinafter referred to as the Agreement ;
Considering that Article 2 ( 3 ) of the Agreement of December 19th 1972 ,
establishing an Association between the European Economic Conmunity
and the Republic of Cyprus , provides for the elimination of obstacles
as regards the main body of trade between the two parties in two
successive stages ;
Considering that , under the terms of Article 2 ( 3 ) of the Agreement ,
the first stage was due to expire on 30 June 1977 , but this stage has ,
however , been extended by the Additional Protocol to the Agreement ,
signed on 15 September 1977 , until 31 December 1979 , and subsequently
by the Transitional Protocol to the Agreement , signed on 7 February
1980 , until 31 December 1980 ;
Considering that , at its meeting of 24 November 1980 , the Association
Council decided that the two Parties would enter the process into the
second stage of the Agreement ;
Considering that the Community and Cyprus wish to strengthen still
further their relations in order to take account of the new dimension
created by the accession of       Spain  and  Portugal to the European
Conmunities on 1 January 1986 ;
 ---pagebreak---                                       2
Have accordingly decided to conclude a protocol laying down the
conditions and procedures for the implementation of Article 2 ( 3 ) of
the Agreement on the establishment of a customs union and adapting
certain provisions of the Agreement , and to this end have designated
as their Plenipotentiaries :
THE COUNCIL OF TOE EUROPEAN COMMUNITIES :
THE GOVERNMENT OF THE REPUBLIC OF CYPRUS :
WHO, having exchanged their Full Powers , found in good and due form,
HAVE AGREED AS FOLLOWS :
                                 Article 1
1.           This Protocol lays down the conditions , arrangements and
timetable    for the implementation of the provisions of Article 2 ,
paragraph   3 , concerning the establishment of a Customs Union , of the
Agreement    establishing an Association between the European Economic
Corrmunity  and the Republic of Cyprus .
2.       The completion of the second stage of the Agreement shall take
place in two phases , the first starting on the entry into force of
this protocol and terminating 10 years thereafter and the second of a
duration of 5 years that could be reduced to 4 years in accordance
with the provisions of Article 29 of this Protocol .
3.         The second stage shall be governed by the provisions of the
Agreement as amended and completed by the following provisions .
                                                                         III
 ---pagebreak---                                         3
                                    TITLE I
                                  FIRST PHASE
                                   CHAPTER I
                               Movement of goods
                                   Article 2
          During the first phase of the second stare , trade between the
 Cmrunity and Cyprus shall remain based on the system of origin rules
5 2- out in the Protocol to the Agreement determining the rules of
origin to be applied to the products covered by the Agreement .
                                  CHAPTER II
                             Industrial products
                                   Article 3
         Articles 4 to 14 shall apply to industrial products ; these
ream, products other than those falling under Ar_-.ex II of the Treaty
establishing the European Economic Community .
                                   Section I
     Elimination of Customs duties between the Community and Cyprus
                                   Article 4
         On the entry into force of this Protocol , the Commnunity shall
arclish the annual ceilings for the following products originating in
h-ras .
        CCT                           Description
     Heading N *
     Ξ6.04          Man-made fibres ( discontinuous or waste ) , carded
                    combed or otherwise prepared for spinning
     51.01          Men ' s and boys ‘ outer garments
4
  V
 ---pagebreak---                                     - 4
                                  Article 5
1.           Cyprus shall , on products originating in the Corwnunity,
apart from those products listed in Annex 1 to this Protocol and in
Annex I , list B to the Agreement , progressively abolish customs duties
and charges having an equivalent effect , including customs duties of a
fiscal nature , according to the following timetable :
                   Timetable                       Rate of Réduction
2 months after thei start of th<i  second stage         9 %
1 year after t¿he start <3f the second stage            13 «
2 years after the start of the second stage             2" %
3 years after the start of the second stage             3c %
4 years after the start of the second stage             45 %
5 years after the start of the second stage             54 %
6 years after the start of the second stage             63 %
7 years after the start of the second stage             72 %
8 years after the start of the second stage             =: %
9 years after the start of the second stage             33 %
1C) years after theÌ start of the second stage          : χ>%
2.        For each product , the basic duty on which Cyprus is to apply
the successive reductions shall be the duty actually ipplied in res ¬
pect of the Conmunity on the 1 January 1986 .
                                 Article 6
1.          Notwithstanding Article 5 , Cyprus shall , or. the products
originating in the Community listed in Annex 2 progressively abolish
custcns duties and charges having an equivalent effect ,       including
customs duties of a fiscal nature , according to the           following
timetable :
                                                                         V
 ---pagebreak---                                       5
                 Timetable                         Rate of Réduction
 2 months after the start of the second stage            4 %
 1  year after the start of the second stage             8 %
 2  years after the start of the second stage          12  %
 3  years after the start of the second stage           18 %
 4  years after the start of the second stage          24  %
 5  years after the start of the second stage           30 %
 5 years after the start of the second stage           45 %
 7 years after the start of the second stage           60 %
 3 years after the start of the second stage           75 %
 9 years after the start of the second stage           90 %
 10 years after the start of the second stage          100 %
 2.        For each product listed in Annex 2 the basic duty on which
•Overns is to apply the successive reductions shall be the duty actual¬
 ly applied in respect of the Cormunity on 1 January 1986 .
                                 .Article 7
 1.       The rates of Cypriot tariff dismantling set out in Articles 5
 arc 6 may in the first phase of 10 years , be adapted as necessary by
the Oouncil of Association to take account of the economic development
 of Cyprus and the priorities laid down in the Cypriot development
 2.       Following an application by Cyprus to the Community , the Coun¬
 cil cf Association may , in order to meet the requirements of industri ¬
 alization and development in Cyprus , authorize Cypres to reintroduce ,
increase or establish customs duties on products originating in the
Ornrjiity by up to 20 % ad valorem and in exceptional cases by up to
13 % ad valorem .
 ---pagebreak---                                    - 6 -
 3.          Cyprus may take appropriate measures , in accordance with the
provisions of paragraphs 1 and 2 after informing the Council of
Association where an increase in imports of a given product is or is
likely to be seriously detrimental to the requirements of
industrialization and development in Cyprus and where this increase is
due to :
- the partial or total reduction by Cyprus , as provided for in Arti¬
    cles 5 and 6 of customs duties and charges having equivalent effect
    levied on the product in question , and ;
- the fact that the duties or charges having equivalent effect levied
    by the Conmunity, on imports of raw materials or intermediate pro¬
    ducts used in the manufacture of the product in question are signi¬
    ficantly lower than the corresponding duties or charges levied by
    Cyprus .
4.            The measures referred to in paragraph 3 shall be examined
within the Council of Association . This examination shall take place
within 30 working days of the notification of such measures by
Cyprus . If the Council of Association has not approved within 30
working days the measures taken by Cyprus , these measures shall be
abolished .
5.        The measures referred to in paragraphs 2 and 3 may be applied
only to a maximum volume of 15 % of Cypriot imports from the Community
calculated on the average total value in the two preceding years for
which Community statistics are available .
6.        In the event of Cyprus applying tariff measures referred to in
paragraphs 1 , 2 , 3 and 4 , preference in favour of products originating
in the Corrmunity shall be maintained by an adaptati cc. of the duties
applied by Cyprus in respect of imports from third countries .
7.            The measures adopted in paragraphs 1 , 2 , 3 and 4 shall be
progressively eliminated according to a timetable agreed by the two
contracting parties and abolished at the latest by the end of the
first phase of the second stage of the Agreement .
          The Council of Association in exceptional cases may approve
the extension of certain measures beyond the first phase .
                                                                           1A
 ---pagebreak---                                      - Τ'-
                                  Section II
                Adoption by Cyprus of the Common Customs Tariff
                                   Artide 8
          The Cypriot Customs Tariff apart from that applied on
 products listed in Annex 1 to this Protocol and in Annex I , List B to
 the Agreement , shall be progressively aligned on the Common Customs
 Tariff as it stands at any given moment on the basis of the duties
 actually applied by Cyprus in respect of third countries on the 1
 January 1986 and in accordance with the following rules :
 1.         in the case of products on which the duties actually applied
 by Cyprus at the date indicated above do not differ from the Cocnon
 Customs Tariff by more than 15 % either way , the latter shall be ap¬
 plied by Cyprus from the entry into force of this Protocol .
 2.       In other cases , Cyprus shall apply, two months after the entry
 into force of this Protocol , duties reducing by 9 % the difference
 between the rate actually applied and the duty in the Common Customs
 Tariff .
          Nine further reductions , each of 9 % shall be made at the be¬
 ginning of the second , third , fourth , fifth , sixth, seventh , eigth ,
 ninth and tenth years respectively after the entry into force of this
 Protocol .
          The Contnon Customs Tariff shall be applied in its entirety at
 the beginning of the eleventh year following the entry into force of
 this Protocol subject to the provisions of Article 7 paragraphs 6 and
 7.
 3.           In the event of the Common Custexts Tariff being modified
 during the above period of 10 years the rate of alignment shall be
 adjusted to ensure that the difference between the Cypriot Customs
 Tariff and the CCT is eliminated in equal steps between the date of
 modification of the CCT and the beginning of the eleventh year .
                                   Article 9
          Notwithstanding Article 8 Cyprus shall for the products listed
 in Annex 2 align its customs tariff on the Common Customs Tariff in
 accordance with the following rules .
■h                                                                         1K
 ---pagebreak---                                       - 8 -
  1.        Cyprus shall apply, two months after the entry into force of
 this Protocol , duties reducing by 4 % the difference between the rate
 applied on the 1 January 1986 and the duty in the Common Customs
 Tariff .
 2.         Two further reductions , each of 4 % shall be made at the be¬
 ginning of the second and third years .
           This difference shall be further reduced by three reductions ,
 each of 6 % at the beginning of the fourth , fifth and sixth years and
by four reductions each of 15 % at the beginning of the seventh ,
 eighth , ninth and tenth years .
          The Common Customs Tariff shall be applied in its entirety at
the beginning of the eleventh year following the entry into force of
this Protocol .
                                  Section III
               Elimination of quantitative restrictions by the
                             Contracting Parties
                                 Article 10
          Cyprus shall abolish quantitative restrictions and • all
measures having an equivalent effect on imports from the Conrnunity
upon the entry into force of this Protocol apart from products
 listed in Annex I List B to the Agreement .
                                 Article 11
1.        Notwithstanding Article 10 , Cyprus may impose import licences
on imports for home consumption originating in the Conrnunity for the
products in Annex 1 , according to the rules set out in paragraphs 2 ,
3 , 4 and 5 .
2.        Within the quantities laid down in Annex 1 , the import license
shall be issued automatically within a period of five working days
from the submission of the request . Should it not be issued within
this period ,    the products in question may nevertheless be freely
imported .
4                                                                         гй
 ---pagebreak---                                             9
   3.        During the first phase of the second stage , the quantities for
   certain products in Annex 1 shall increase by 50 % in ten equal annual
   steps of 5 % »
   4.         The first increase shall be made to the initial quantities on
   the 1 January of the year following the entry into force of this
   Protocol .     Subsequent increases shall be at the beginning of each
  year .
  5.            Annex 7 shall define the rules which shall be applied by
  Cyprus for the administration of the quantities laid down in Annex 1 .
                                     Article 12
  1.         Notwithstanding Article 10 , Cyprus may impose import licences
  on imports for home consumption originating in the Cormunity up to the
  end of the first phase of the second stage for the products in Annex
  3 , according to the rules set out in paragraphs 2 , 3 , 4 and 5 .
  2.           Within the quantities or values laid down in Annex 3 , the
  import Licences shall be issued automatically within a period of five
  working days from the submission of the request . Should it not be
  issued within this period , the products in question may nevertheless
  be freely imported .
  3.         During the first phase of the second stage , the quantities or
  values for the products in Annex 3 shall increase by :
  - 100 % in ten equal annual steps of 10 % for quantity limits ;
  - 150 % in ten equal annual steps of 15 % for value limits .
  4.           Notwithstanding paragraph 3 during the first phase of the
  second stage the rate of increase of the quantities for the following
  products in Annex 3 shall be :
    Cyprus Tariff         Product                     Rate of increase
        Heading         Description                    in first phase
       36.06          Matches                 60 S in ten equal annual steps
                                              of 6 %
       69.05          Roofing tiles           80 % in ten equal annual steps
                                              of 8 %
   5.            The first increase shall be made to the initial quantities or
   values on the 1 January of the year following the entry into force of this
.  Protocol . Subsequent increases shall be at the beginning of each calendar year
 ---pagebreak---                                         10-
   6.      Where imports into Cyprus of a product originating in the Com¬
   munity listed in Annex 3 have for three consecutive years been less
   than 80 % of the quantity limit or value limit established under the
   provisions of paragraphs 3 , 4 and 5 , imports of that product from the
   Member States of the Community shall be liberalized as from the begin¬
   ning of the year following these three years .
   7.      The Council of Association may , in the context of the Decision
   to pass  from the first phase to the second phase of the second stage ,
   approve the extension of the provisions of paragraph 1 for products in
   Annex 3 beyond the first phase .
   8.       Annex 7 shall define the rules which shall be applied by Cy¬
   prus for the administration of the quantity and value limits laid down
   in Annex 3 .
                                  Artide 13
           Cyprus shall progressively adjust any State monopolies of a
   commercial character , so as to ensure that , when the first phase of
   the second stage has ended , no discrimination regarding the conditions
   under which goods are procured and marketed , exists between nationals
   of Member States of the Community and nationals of Cyprus .
                                  Section IV
                        Processed Agricultural Products
                                  Article 14
           The Contnunity shall abolish the fixed component for the pro¬
   ducts mentioned in Annex I List A to the Agreement , as amended by the
   Additional Protocol signed at Brussels on 15 September 1977 and in Ar¬
   ticle 4 of the same Protocol , upon the entry into force of this Pro¬
   tocol .
                                  CHAPTER III
                             Agricultural products
                                  Artide 15
           For the purposes of Articles 16 to 26 , agricultural products
   shall mean all' those falling under Annex II of the Treaty establishing
   the European Economic Community .                                       й
4,
 ---pagebreak---                                     - 11 -
                                   Section I
             Elimination of customs duties between the Community
                     and Cyprus and adoption of the CCT
                                  Article 16
  1.        On the entry into force of this Protocol , the Comnunity and
 Cyprus shall progressively abolish residual customs duties and charges
 having an equivalent effect for agricultural products covered by reci¬
 procal concessions in the Agreement and this Protocol which are listed
 in Annex 4 and within the limits and in accordance with the conditions
 of such concessions . This tariff dismantlement shall apply under the
 same conditions and timetable laid down for industrial products in
 Article 5 .
 2.       Notwithstanding paragraph 1 the customs duties and charges ha¬
 ving an equivalent effect applicable on the importation into Cyprus of
 agricultural products covered by reciprocal concessions originating in
the Community mentioned in Annex 5 shaJ_l ,-^.during the first phase of
 the second stage of the Agreement be those of the General Customs Ta¬
riff of Cyprus .
 3.       The tariff preference granted to the Community for the produc¬
ts in Annex 5 and Annex 6 shall be maintained . In addition Cyprus
shall progressively abolish residual customs duties and charges having
an equivalent effect for sugar originating in the Community falling within
Cypriot tariff heading 17.01 according to the timetable laid down in Article 5 .
4.         The Community or Cyprus may propose , during the first phase ,
within the Council of Association , to change the list of products of
Annex 4 if such a change would be to the benefit of the Contracting
Parties .
                                 Article 17
1.        Cyprus shall progressively apply the Common Customs Tariff for
agricultural products covered by reciprocal concessions in the Agree¬
ment and this Protocol ,   under the conditions and timetable laid down
for industrial products in Article 8 .
2.        Notwithstanding paragraph 1 , for the agricultural products co¬
vered by reciprocal concessions in the Agreement mentioned in Annex 5 ,
Cyprus , during the first phase of the second stage of the Agreement ,
shall not align its customs duties with the Common Customs Tariff .
 ---pagebreak---     • <
                                        - 12 -
                                      Section II
                              Tariff Quotas and Calendars
                                      Article 18
      1.        The tariff quota for new potatoes , falling within sub-heading
     07.01 A II b ) of the Common Customs Tariff , as laid down in the Agree¬
     ment , shall be increased from 60.000 tonnes to 110.000 tonnes in ter.
     equal annual steps of 5.000 tonnes in the first phase of the second
     stage .
               This tariff quota shall apply for the period 16 May to ZZ
     June •
  - 2.           The tariff quota for fresh table grapes falling within sub¬
    headings ex 08.04 A I a ) and b ) of the Common Customs Tariff , as la^i
     down in the Agreement , shall be increased from . 500 to 11.000 tonnes
    by 600 tonnes in the first year , 5-00 tonnes in the second year and 2 Z'Z
     tonnes in each of the eight years following of the first phase of the
     second stage .
               This tariff quota shall apply for the period 8 June no 4 Au ¬
     gust .
     3.          The tariff quota for dried grapes falling within subheading
   08.04 B I of the Cocrron Customs Tariff , as laid down in the Agreement •
     shall be increased from 500 tonnes to 1 500 tonnes upon the entry into
     force of this Protocol and thereafter at the rate laid down in para ¬
     graph 4 .
     4.         The Comnunity shall increase in the first phase of the sect'. i
     stage the Community tariff quotas for agricultural products covered by
     concessions in the Agreement and this Protocol and originating in
     Cyprus other than those referred to in paragraphs 1 , 2 and 3 by 50 V
     in ten equal steps of 5 % per annum of the Community tariff quota
     applicable at the entry into force of this Protocol . These provisions
     shall apply without prejudice to Article 19 paragraph 3 .
     5.        For wines of fresh grapes falling under the subheading 22.05 Z
    of the Cormon Customs Tariff , put up in containers of 2 litres : r
      less , originating in Cyprus , the provisions in paragraph 4 shall aptly
%
     to a Corrmunity tariff quota of 35 . ICO hi .                            .
 ---pagebreak---                                          13
             For liqueur wines of an alcoholic strength by volume of 15 %
    or more falling within subheading 22.05 C originating in Cyprus , the
    provisions in paragraph 4 shall apply to a Comunity tariff quota of
    150,000 hi .
                                     Section III
                             New Products and Calendars
                                     Article 19
    1.        For the products listed in paragraph 5 originating in Cyprus
    and imported into the Conmunity the customs duties applicable shall be
    phased out according to the procedures set out in Article 16 paragraph
    1 of this Protocol and in this Article .
    2.       For the products referred to in paragraph 1 , Cyprus shall pro¬
    gressively adopt the Common Customs Tariff according to the procedures
    set out in Article 17 paragraph 1 of this Protocol .
    3.        Where Conmunity tariff quotas are applicable these shall be
    increased , apart from wine of fresh grapes in containers holding more
    than two litres , falling within subheading ex 22.05 C I a ) and b ) of
    the Common Customs Tariff , according to the procedures set out in Ar¬
    ticle 18 , paragraph 4 .
h-' 4P
 ъ
                                                                           ъ
 ---pagebreak---                                    - 14 -
4.            For the purpose of eliminating customs duties reference
quantities are established for the following products originating in
Cyprus :
- artichokes falling within subheading 07.01 L
- kiwi fruit falling within subheading ex 08.09
           Should the volume of imports of one of these products exceed
the reference quantity , the Conrounity , having regard to the annual
review of trade flows which it shall carry out , may make the product
in question subject to a Community tariff quota , the volume of which
shall be equal to the reference quantity .
5.          For the products listed below , other than those for which a
Cotraiiunity tariff quota or reference quantity is fixed , the Community
may establish a reference quantity as provided for in paragraph 4 if
it discovers in the light of the annual review of trade flows which it
shall carry out , that the volume of imports threatens to cause diffi ¬
culties on the Community market .
 ---pagebreak---                                   15
OCT Heading N *                      Description
   06.03         Cut flowers and flower buds of a kind suitable
                 for bouquets , or for ornamental purposes , fresh ,
                 dried , dyed , bleached , impregnated or otherwise
                 prepared :
                 A. Fresh ( a )
   07.01         Vegetables , fresh or chilled :
                 B. cabbages , cauliflowers and Brussels sprouts
                 III . Other
                 Chinese cabbage ( Brassica sinensis and Brassica
                 Pekinensis )
                 - from 1 November to 31 December ( b )
                 D. Salad vegetables , including endive and chicory
                 ex II Other ( Lactuca sativa L. var capitata
                                type crisp head )
                         Iceberg lettuce from 1 November to 31 De-
■■
                         cember ( c )
                K. Asparagus
                    from 1 November to end February
                L. Artichokes
                    from 1 October to 31 December ( d )
                    T : Other
                    I : Courgettes , from 1~ Doc-ember to 15 ‘-larch
  07.04         Dried , dehydrated or evaporated vegetables ,
                whole , cut , sliced , broken or in powder but not
                further prepared
                B. Other :
                    Peppers
 08.01          Dates , bananas , coconuts , Brazil nuts , cashew
                nuts , pineapples , avocados , mangoes , guavas and
                mangos teens , fresh or dried , shelled or not .
                D. Avocados
                ex H : Other :
                             Mangoes
 08.08          Berries fresh
                F. Other
                    ex II Other :
                            Passion fruit
 08.09          Other fruit , fresh :
                - Kiwi fruit from 1 January to 30 April ( e )
                - Persimmons from 1 December to 31 July
                                t
09.04           Pepper of the genus " Piper " pimento of the genus
                " Capsicum" or the genus " Pimenta " :
                A. Neither Ground or crushed
                    II . Pimento
                    c ) Other
 ---pagebreak---                                         16 -
  CCT Heading N *                        Description
   09.10           Thyme , saffron and bay leaves ? other spices :
                  A. Thyme :
                        I. Neither crushed nor ground :
                             a ) Wild thyme ( Thymus serpyllum )
                             b ) other
                      II . Crushed or ground
                  B. Bay leaves
                  C. Saffron :
                        I. Neither crushed nor ground
                        II . Crushed or ground
   12.07          Plants and parts ( including seeds and fruit ) of
                  trees , bushes , shrubs or other plants , being
                  goods of a kind used primarily in perfumery , in
                  pharmacy, or for insecticidal , fungicidal or simi¬
                  lar purposes , fresh or dried , whole , cut , crushed ,
                  ground or powdered :
                  D. Other
   20.07          Fruit juices, ( including grape must ) sind vegetable
                  juices whether or not containing added sugar , but
                  unfermented and not containing spirit
                  B. Of a density of 1,33 g/cm3 or less at 20 *C :
                      I. Grape , apple and pear juice ( including grape
                          must ) ; mixtures of apple and pear juice :
                          a ) of a value exceeding 18 ECU per lOO kg
                                net weight :
                                1 . Grape juice ( including grape must ) :
                                    aa ) concentrated : ( f )
                                          11 . with an added sugar content
                                                 exceeding 30 % by weight
                                          22 . other
                          b ) of a value of 18 ECU or less per lOO kg
                                net weight :
                                1 . Grape juice ( including grape must ) :
                                    aa ) concentrated : ( f )
                                          11 . With an added sugar content
                                                exceeding 30 % by weight
                                          2 2 - Other
   22.05          Wine of fresh grapes , grape must with fermenta¬
                  tion arrested'
                  C. Other
                      I. Of an actual alcoholic strength by volume
                          not exceeding 13 voi , in containers holding :
                           ( ex ) b ) More than two litres
                                      - Wine of fresh grapes ( g )
O
                                                                           ъ
 ---pagebreak---                                           17
    CCT Heading N *                       Description
                    'II . Of an actual alcoholic strength by volume
                          exceeding 13 % voi . but not exceeding 15 %
                          voi . , in containers hold
                           ( ex ) b ) More than two litres
                                      - Wine of fresh grapes ( g )
                           ( a ) within a Community tariff quota of 50 ton¬
                                 nes
                          ( b ) within a Community tariff quota of 100
                                 tonnes
                          ( c ) within a Community tariff quota of 100
                                 tonnes
                          ( d ) within a reference quantity of 100 tonnes
                          ( e ) within a reference quantity of 200 tonnes
                          ( f ) within a global Community tariff quota of
                                 3.000 tonnes
                          ( g ) within a global Community tariff quota of
                                 26.000 hi
6.      For Kaskaval cheese originating in Cyprus falling within sub
heading 04.04 El b2 of the Corner: Customs Tariff the levy on imports
shall be reduced .
                                     Section IV
        Special Measures to make account of the Enlargement of
                                   che Conrnunity
                                    Article 20
1.         For 1990 and for each successive marketing year , the Cormu-
nity shall decide , on the basis of the statistical review and analysis
referred to in paragraph 2 below whether to adjust the entry price ,
referred to in Regulation ( ZZC ) n * 1035 / 72 , for the following products
originating in Cyprus , within the following quantitative limits-
 ---pagebreak---                                         18
                                                                           j
        CCT Heading No             Description              Quantity       ¡
                                                                           »
                                                                           }
         08.02 ex A       Sweet oranges , fresh :       67.000 tonnes      ¡
         08.02  ex   C    Lemons :                     15.000 tonnes      i
                                                                          »
                                                                          !
                                                                          1
         08.04 A ex I     Fresh table grapes
                          for the period                                 1
                          8 June to 4 August :         10 . 500 tonnes   ,
                                                                         1
                                                                         1
                                                                         (
   2. .          From 1987 onwards and at the end of each marketing year the
   Comnunity shall carry out , on the basis of a statistical review, an
  analysis of the situation for the products referred to in paragraph 1
  originating in Cyprus exported to the Corrmunity.
               For these same products , from 1989 onwards and for each subse¬
  quent year , the Community shall draw up a forecast of production and de¬
   liveries with Cyprus .
   3.          The possible adjustment provided for in paragraph 1 refers to
  the sum to be deducted , in respect of customs duty , from the representa¬
  tive prices recorded in the Comnunity for the purpose of calculating the
  entry price of these products , within the limits set out in Article 152 ,
  paragraph 2 c ) of the Act of Accession of Spain and Portugal .
                                  Article 21
  1.           For wine of fresh grapes falling within heading no ex 22.05 C
  of the Common Customs Tariff originating in Cyprus presented in contai ¬
  ners holding 2 litres or less , the fixed amount added to the price refer¬
  red to in Article 53 of Regulation ( ITC ) no 822 /87 on the common organi ¬
  zation of the market in wine shall be phased out at the rate indicated
  below within the limit of an annual volume of 35.000 nl .
r-j ;
  T?                                                                         îi
 ---pagebreak---                                         19
                Upon the entry into force of this protocol the fixed amount
shall be reduced to 75 % :
2 years after the start of the second stage , the fixed amount shall be
reduced to 60.0 % ;
4 years after the’ start of the second stage , the fixed amount shall be
reduced to 45.0 % ;
6 years after the start of the second stage , the fixed amount shall be
reduced to 30.0 % ;
8 years after the start of the second stage , the fixed amount shall be
reduced to 15.0 % ;
10 years after the start of the second stage , the fixed amount shall
be reduced to 0.0 % .
2.              The Conmunity may fix a special frontier price for wine of
fresh grapes and for liqueur wines of an alcoholic strength by volume
of - 15 % or more , falling within subheading ex 22.05 C presented in
containers of more than 2 litres , if for the marketing year current at
the entry into force of this protocol , it is established on the basis
of information available at the end of this current marketing year
that there is a fall in the level of exports of these wines to the
Conmunity compared to the previous marketing year . This latter
marketing year shall serve as a reference year . For subsequent
marketing years , the exports made shall be compared to the reference
year .
                Such special frontier price shall be fixed each year and
before each marketing year and shall apply to imports up to an annual
volume of :
- 26 000 hi for wines of fresh grapes falling within subheading
   ex . 22 . 05 C ;
- 73 000 hi for liqueur wines falling within subheading ex . 22.05 C
The situation shall be reviewed before 1 January 1990 .
                                    SECTION V
          Elimination of quantitative restrictions on agricultural
                                    products
                                   Article 22
                Quantitative restrictions ar.d measures having an equivalent
effect on imports of agricultural products originating in the
Conmunity covered by reciprocal concessions shall be abolished by
Cyprus upon the entry into force of this Protocol .
1)                                                                          'M
 ---pagebreak---                                 Article 23
 1.         Notwithstanding Article 22 / Cyprus mciy continue to apply up
to the end of the first phase of the second stage the existing import
licensing system to imports originating in the Community for the pro¬
ducts in Annex 5 . *
2.          The Council of Association may , in the context of the Deci ¬
sion to pass from the first phase to the second phase of - the second
stage approve the extension of the provisions referred to in paragraph
1 beyond the first phase .
                                Article 24
1.              For the products set out in Annex 6 destined for home
consumption originating in the Community , Cyprus shall for the
quantities indicated in Annex 6 automatically issue import licences
within a period of five working days from the submission of the
request . Should they not be issued within this period the goods in
question may be freely imported .
2.           The quantities for certain products listed in Annex 6 shall
be increased by 30 % during the first phase of the second stage in ten
annual equal steps of 3 % of the initial quantity applicable upon the
entry into force of this Protocol .
             The first increase shall be cade to the initial quantity on
the 1 January of the year following the entry into force of this pro¬
tocol .
3.     Annex 7 shall define the rules which shall be applied by Cyprus
for the administration of the quantities laid down in Annex 6 .
4.      Either the Community or Cyprus ray propose , during the first
phase , within the Council of Association to change the list of
products in Annex 6 if such a change would be to the benefit of the
contracting parties .
                                SECTION VI
               Mechanisms of the Common Agricultural Policy
                                Article 25
             The application of the frontier mechanisms of the Common
Agricultural Policy shall not be affected during the first phase of
the second stage , subject to special arrangements applied to certain
products falling under Annex II of the Treaty establishing the Euro¬
pean Economic Community in Articles 20 and 21 of this Protocol .        Ь
                                                                        ^
 ---pagebreak---                                       21
                                  Article 26
 1.            The free movement of agricultural products , covered in the
 Agreement and the present Protocol by reciprocal concessions , shall be
 conditional on an agreement being made i-t the framework of the deci¬
 sion taken by the Association Council frr the passage to the second
phase of the second stage , on the following principles :
      i)    the introduction by Cyprus of Cmnunity quality standards for
           these products ;
      ii ) the application by Cyprus internally of domestic price cons¬
           traints for these products similar to those in force in the
           Community , with a view to ensuring the stability of the do¬
           mestic market and avoiding marker crises . In this connection
           and with a view to preventing recourse to safeguard measures ,
           procedures shall be set up for the identification of a state
           of crisis on the market and provision for measures which
           Cyprus should apply on its domestic market in relation to the
           degree of disturbance or risk of disturbance ;
     iii ) the application by Cyprus of Cnmunity measures for these
           products at the Cyprus frontier .
2.         With a view to implementing the principles referred to in pa-
ragraph 1 , Cyprus shall submit suggestions to the Community during the
first phase of the second stage as to the effective measures Cyprus
will adopt under its own responsibility on both its domestic market
and at its frontiers which will enable free movement of the products
referred to in paragraph 1 to be established .
3.         The Consnunity shall define its position on the suggestions of
Cyprus referred to in paragraph 2 , in the light , notably, of the poli¬
cy debate within the bodies of the Association Council .
           The Association Council shall ietide on this subject before
the end of the first phase of the second stage .
                                                                           ΊΚ
 ---pagebreak---                                      - 22 -
                                   CHAPTER IV
                    Harmonization of Accompanying Policies
                    ’             Artide 27
 1.           The Contracting Parties recognize that the principles laid
down in Articles 85 ( agreements between undertakings ), 86 ( dominant
position of an undertaking ), 90 ( public undertakings ), - 92 ( State
aids ), 95 ( taxation of products ), 96 ( repayments on exportation ), 97
 ( turnover taxes ), 98 ( remissions and repayments in respect of exports )
and 100 ( approximation of laws ) of the Treaty establishing the Euro¬
pean Economic Cormunity shall be applied in their relations within the
Association .
2.         The conditions and detailed rules for the application of the¬
se principles and the guarantees relating to their proper           appli¬
cation shall be examined by the Contracting Parties during the first
phase of the second stage within the Association Council .
3.         The measures referred to in paragraph 2 that are essential to
ensure the smooth functioning of the Customs Union shall be agreed
between the contracting parties and laid down in a Protocol which
shall enter into force at the beginning cf the second phase at the
latest .
                                  Article 28
1.           From the entry into force of the second stage in accordance
with the principles set out in Article 27 concerning Articles 85 , 86
and 92 of the Treaty establishing the European Economic Cormunity , the
following are incompatible with the proper functioning of the Agree¬
ment in so far as they may affect trade between the Comunity and
Cyprus :
           i ) all agreements between undertakings , decisions by associa¬
               tions of undertakings and concerted practices between un¬
               dertakings which have as their object or effect the pre¬
               vention , restriction or distortion of competition as re¬
               gards the production of or trade in goods ;
          ii ) abuse by one or more undetakir.gs of a dominant position in
               the territories of the Contracting Parties as a whole or
               in a substantial part thereof ;
         iii ) any public aid which distorts cr threatens to distort com¬
               petition by favouring certain undertakings or the produc¬
               tion of certain goods .
                                                                         h
 ---pagebreak---                                        23
 2.      , Should a. Contracting Party note that such a practice referred
 to in paragraph 1 , is being applied by its partner , it may take appro¬
 priate measures after consultations within the Association Council .
                                   TITLE II
                                 SECOND PHASE
                                  Article 29
 1.         The second phase of the second stage shall enter into force
by a Decision of the Association Council .
 2.        The second phase of the second stage shall have a duration of
5 years that could be reduced to four years by a Decision of the Asso¬
ciation Council .
3-           The provisions of the first phase of the second stage shall
continue to apply until the entry into force of the second phase .
                                  Article 30
1.          For the passage to the second phase of the second stage , as
referred to in Article 29 , the Association Council shall take a Deci ¬
sion on :
           i ) the regime that will apply to the movement of goods ;
         ii ) any measures concerning accompanying policies referred to
               in Article 27 , not adopted during the first phase of the
               second stage ;
        iii ) measures concerning the free movement of certain agricul¬
               tural goods covered in the Agreement by reciprocal conces¬
               sions ;
         iv ) the provisions referred to a Title I Chapter II and III of
               this Protocol .
2.         In the second phase of the second stage of the Agreement the
measures decided by the Association Council , referred to in paragraph
1 , that are necessary to ensure the transition to the Customs Union
shall be applied .
Τϊ
 ---pagebreak---                                      24 -
 3.        Trade in products fallin . under Annex II of the Treaty esta¬
blishing the European Economic Community and trade in products subject
to specific measures of Community trade policy shall , without preju¬
dice to the Decision of the Association Council forseen in paragraph 1
concerning products other than those referred to above , continue to be
based on the system of rules of origin referred to in Article' 2 for as
long as the conditions of free circulation of these products shall not
be completely fulfilled .
4.         The measures agreed by the Association Council to ensure the
free movement of certain agricultural products as laid down in Article
26 shall be applied by Cyprus in accordance with the agreed time¬
table .
5.         Having regard to the actual application by Cyprus of the mea¬
sures referred to in paragraph 1 according to the agreed timetable ,
the Corrmunity shall dismantle its own frontier price mechanisms for
these products at the same time and according to the same timetable .
                                Article 31
           The Customs Union shall be fully achieved at the end of the
second phase of the second stage .
                                 TITLE III
                       General and Final Provisions
                                Article 32
1.          A Trade and Economic Cooperation Cc.Tmittee shall be set up
for the purpose of improving the working of the institutional mecha¬
nisms of the Agreement .
The Corrmittee shall facilitate :
- the regular exchange of information on trade and production data and
    forecasts ;
- the regular exchange of information on the possibilities for coope¬
    ration in areas covered by the Agreement .
           The office of the chairman of the Committee shall be held al¬
ternately by a representative of the Commission of the European Com¬
munities and a representative of Cyprus .
 ---pagebreak---                                      25
2.          The Association Council shall determine as soon as possible
the composition of this Committee and how it shall function in accor¬
dance with Article 14 paragraph 2 of the Agreement .    It may also deci ¬
de where appropriate upon the submission of reports to the Council by
the Committee .
                                 Article 33
           Either Contracting Party shall , if S3 requested by the other
Contracting Party , provide all relevant information on any agreements
it concludes containing tariff or trade provisions , and on any amend¬
ments to its Customs tariff or external trade arrangements .
           Where such amendments or agreements have a direct and speci¬
fic impact on the functioning of the Agreement., appropriate consulta¬
tions shall be held within the Association Council at the request of
the other Contracting Party .
                                 Article 34
1.         Either Contracting Party may refer to the Association Council
any dispute relating to the interpretation zz this Agreement and of
concern to the Community , a Member State of the Community or Cyprus .
2.          The Association Council may settle ihe dispute by means of a
decision .
3.           Each Party shall be bound to take ohe measures involved in
carrying out the decision referred to in paragraph 2 .
4.           In the event of it not being possible to settle the dispute
in accordance with paragraph 2 of this Article , either party may
notify the other of an appointment of an arbitrator ; the other Party
must then appoint a second arbitrator within two months .        For the
application of this procedure the Community and the Member States
shall be deemed to be one Party to the dispute .
                                                                           %
 ---pagebreak---                                         26
          The Association Council shall appoint a third arbitrator .
          The decisions of the arbitrators shall be taken by majority
vote .
          Each Party to the dispute must take the      easures required for
the implementation of the arbitrators' decision .
                                   Article 35
          Annexes 1 , 2 , 3 , 4 , 5 , 6 and 7 and also the declarations and
exchanges of letters in the Final Act shall form an integral part of
this Protocol .
          This Protocol shall form an integral part of the Agreement
between the European Economic Community and the Republic of Cyprus .
                                   Article 36
1.        This Protocol shall be ratified , accepted or approved by the
Contracting Parties in accordance with their own procedures ; the Con¬
tracting Parties shall notify each other of che completion of the pro¬
cedures necessary to that end .
2.        This Protocol shall enter into force on the first day of the
second month following the said notification .
                                  Article 37
          This Protocol is drawn up in duplicate in the Danish , Dutch ,
English , French , German , Greek , Italian , Portuguese and Spanish lan¬
guages , each of these texts being equally authentic .
          In witness whereof ,     the undersigned Plenipotentiaires have
herunto set their hands .
Done at Brussels ,
For the Council of the European Communities ,
For the Republic of Cyprus ,
 ---pagebreak---                                            л
                                      Annex 1
                          conceming Articles 5, 8 and 11
       Cyprus Tariff                    Description of goods              Initial
           Heading                                                        Quantity
   17.04                    Sugar confectionary ( not cont . cocoa ) (*)    530 T
   18.06.20                 Chocolates ( * )                                780 T
   18.06.90
   19.03                    Macaroni and other similar products               1 T
   19.08                    Pastry , biscuits , cakes , etc. (*)          1.060 T
   21.04.10                 Tomato ketchup and other sauces containing       40 T
                            ternato
   21.07.20                 Ice cream , ice cream powder , etc.               1 T
   22.03                    Beer made from malt                          250.000 L
   22.06                   Vermouths and other flavoured wines (*)       29.000   L
   22.09                    Spirits (*)                                  230.300 L
   25.23                    Cement                                            10 T
   44.15.90                Plywood ( 1 ) ( * )                             43 m3
   ex 44.18.10              Reconstituted wood in boards or sheets        7.120 m3
                           other them of a thickness not exceeding
                           6 mm ( 2 )
   ex 84.10.90             Water pumps ( 3 )
                           - centrifugal deep-well turbine pumps             10 U
                           - centrifugal surface pumps                    2.350 U
 ( 1 ) For exclusive use in the manufacture of travel goods .
 ( 2 ) For exclusive use in the production of boards or sheets faced with low
       pressure melamine treated paper .
 ( 3 ) Imports will be allowed only for these pumps of higher performence than
        those produced in Cyprus .
 (*) The initial quantity shall increase by 50 % in ten equal steps of 5 % in
        the first phase .
 T *    Met rie tonne
 L *   Litre
 m3*    Cubic métré
 U «   Unit
i>                                                                             w
 ---pagebreak---                                            - %-
                  •
 Cyprus
 Tariff                     Description of goods                           Initial
 Heading                                                                  quantity
  22.08             Ethyl alcohol or neutral spirits , undenatured :
                    of a strength of 140 pro.of or higher ; denatured
                    spirits ( including ethyl alcohol and neutral spi ¬     10,000 L
                    rits ) of any strength not obtained from agricul ¬
                    tural products listed in Annex II of the Treaty
                    establishing the European Community ( 4 )
  44.02             Wood charcoal ( including shell and nut charcoal ),
                    agglomerated or not                                       1 T
                                                    <
  (4 ) Imports will be allowed only for absolute alcohol for industrial use
c4
                                           \\
                                                                                ü
 ---pagebreak---                                Annex 2
                     conceming Articles 6 and 9
     Cyprus Tariff                 Description of goods
         Heading
 ex 19.05.99        Cheesepuffs , chipitos , etc.
 21.07.30           Table jellies , etc.
 22.02              Lemonade , flavoured spa waters and flavoured
                    aerated waters and other non-alcoholic beverages
                    not including fruit and vegetables juices falling
                    within heading No 20.07
 25.01.90           Common salt
 25 . 20           Gypsum
 25.22             Ouick lime
ex 28.04.10        Oxygen
28.13.10           Carbon dioxide
29.14.10           Acetic acid
29.04              Acyclic alcohol
31.02 - 04 .       Mineral or chemical fertilizers
ex 31.05           Other fertilizers
32-09              Paints , varnishes , lacquers , distempers , etc.
 ---pagebreak---                                  " 3^
    Cyprus Tariff                    Description of goods
       Heading
   33.06            Perfumery , cosmetics and other toilet prepara¬
                   tions , etc . .
   34.01           Soaps
   34.02.19        Detergents
   35.06           Prepared glues
   36.06           Matches
   39.07           Plastic articles
  ex 39.01-39.06   Pipes and tubes and polyethylene sheets
  ex 40.11.10      Used or retreated tyres
                                   \
  40.13.19         Rubber gloves
  42.02           Travel goods , etc.
  42.03           Apparel and other articles of leather or imita¬
                  tion leather
  44.13.10        Blocks , strips and freizes for parquet flooring
  ex 44 . 21      Packing cases , boxes and crates of wood
  44.23.20        Assembled parquet
  48.16 . 10      Two-ply or more paper bags
  48.16 . 20      Cigarette packets
  ex 48.16.90     Carton boxes
  48.21.30 + 90   Paper towels , tissues and napkins
  50.09           Woven fabrics of silk etc . .
/
 ---pagebreak---                                   - 31-
   Cyprus Tariff                      Description of goods
      Heading
  51.04              Woven fabrics of man-made fibres ( continuous ) etc.
  52.02              Woven fabrics of metal thread etc.
 53.11               Woven fabrics of sheep's or lamb's wool
 53.12               Woven fabrics of horsehair or other coarse animal
                     hair
 54.05               Woven fabrics of flax or of rami
 55.08,-59.03.11+19  Terry towelling etc.
 55.09               Other woven fabrics of cotton
 56.07              Woven fabrics of man-made fibres ( discontinuous )
 58.01               Carpets , carpeting , etc.
58.02               Other carpets
58.04               Woven pile fabrics , etc.
60.01               Knitted or crochetted fabrics
60.03.90            Stocking and socks , etc . .
60.04               Knitted undergarments
60.05.10            Jerseys , pullovers , etc. , dresses , skirts ,
                    suits and costumes , tracksuits
60.05.71,72,79      Bed , table , toilet and kitchen linen
62.02.12,13,19
61.01               Men ' s and boys ' outergarments
61.02               Women's , girls' and infants' outergarments
 ---pagebreak---                                  - Ъг
                        \
   Cyprus Tariff                     Description of goods
       Heading
 61.03              Men 1 s and boys 1 undergarments
 61.04              Women's , girls' and infants' undergarments
 62.01              Travelling' rugs and blankets
 62.03.10           Sacks and bags , of a kind used for packing of
                    goods ( polypropylene )
64.01-04            Footwear
68.11.21            Setts , flags and paving , hearth and wall tiles
69.05              Koofing tiles
71.12-16           Jewellery , goldsmiths and silversmiths ware
ex 73.13.10        Galvanized corrugated steel sheets
ex 73.18           Tubes and pipes , iron or steel
ex 73.23           Metal containers ( for packing of goods excluding
                   those for canning of fruit or vegetables or
                   juices of fruit and vegetables )
ex 73.31.19        Nails
73.32.10           Wood screws
73.36.10           Space gas heaters
73.38.12           Buckets , iron or steel
73.38.30           Iron and steel wool
ex 76.02 and 76.06 Wrought bars etc. , and pipes , tubes and hollow
                   bars , aluminium
83.02.10           Hinges
83.13.10           Crown corks , Pilfer proof corks
 ---pagebreak---                               - 33-
    Cyprus Tariff                Description of goods
        Heading
  83.15.10        Electrodes
  84.18.93        Air , oil and diesel fuel oil filters for cars
  84.56.10        Concrete mixers
  85.04.10        Electric accumulators for motor cars
  85.19.12        Switches
  ex 87.06.90     Exhausts
  ex 87.06.90     Motor vehicles wheels with used tyres
  93.07.10        Cartridges
  94.01 + 03      Furniture
  94.04           Mattresses
  ex 97.03        Balloons
 J.
N
 ---pagebreak---                                       Annex 3
                              concerning Article 12
  Cyprus Tariff     .         Description of goods                      Initial
    Heading                                                        Quantity/Value
ex 19.05.99      Cheesepuffs , chipitos , etc ;                                1  T
21.07.30        Table jellies , etc.                                          13  T
25.01.90        Common salt for table and kitchen use .                      280  T
                Common salt for industrial use exclusively in food           200 T
                and cosmetic industries
25.20           Gypsum and plasters                                          150 T
25.22           Quick lime                                                   105 T
ex 28.04.10     Oxygen                                                    1.000 kg
28.13.10        Carbon dioxide                                                 1 T
29.04           Acyclic alcohol                                        490.000   L
29.14.10        Acetic acid                                                  165 T
31.02.04        Mineral or chemical fertilizers                           4.500  T
36.06           Matches                                               38 th gross
ex 40.11.10     Used or retreated tyres                                  40.000 U
40.13-19        Rubber gloves                                         3.000 dz pr
ex 44.21        Packing cases , boxes and crates of wood               46 th pc
48.16.10        Two ply or more paper bags                               2 T
48.16.20        Cigarette packets                                    50.000 kg
ex 48.16.90     Carton boxes                                             180 T
55.08,59.03 11+ Terry towelling                                    C £ 20.000
1Q
60.03.90        Stockings and socks , etc.                             240.000 pr
60.04           Knitted undergarments including tights :
                Tights ,                                              180.000   pr
                Shirts ,                                               16.000   pc
                Other undergarments                                   291.000   pc
60.05.10        Jerseys pullovers , etc. .                             60.000   pc
                Dresses , skirts , suits and costumes                  36.000   pc
                Outergarments knitted      v.                          48-000   pc
 ---pagebreak---                                     - 3$-
   Cyprus Tariff  '               Description of goods             Initial
        Heading                                                  Quant ./Value
61.01            Men ' s and boys '  coats                             3.300 pc
                 Men ' s and boys '  suits                            4.100  pc
                 Men ' s and boys '  trousers                        32.900  pc
                 Men's   and boys'   jackets                           3.000 pc
                 Men ' s and boys ' 0/GMT                            12.000 pc
61.02            Wanen 's  and girls'   coats and jackets             7.000  pc
                 Women's   and girl's   suits                        16.000  pc
                 Women's   and girl's   dresses                      49-000  pc
                 Women's   and girl's   skirts                       32.000  pc
                 Women's   and girl's   blouses                      52.000  pc
                 Women's and girl's 0/GMT                            56.000  pc
                                                  t
61.03            Men's and boys' shirts                              20.600 pc
         ·■
                 Men's and boys' pyjamas                              1.800 pc
                 Men ' s and boys ' U/GMT                             3.000 pc
61.04            Women's and girls' shirts                            8.200 pc
      •          Women's and girls' U/GMT                            10.000 pc
60.05.71 + 72+79 Bed , table , toilet and kitchen linen             C£ 360.000
62.02.12 + 13+19
62.03.10         Sacks and bags of a type used for packing of       120.000 U
                 goods ( polypropylene )
64.01-04         Footwear                                           165.000 pr
69.05            Roofing tiles                                      560.000 U
ex 73.13.10      Galvanized corrugated steel sheets                   1.000 T
ex 73.18         Tubes and pipes of iron and steel
       23                                                             2.000 T
       24                                                             1.100 T
       92                                                                100 T
       93                                                             1.500 T
       94                                                             2.000 T
ex 73.23         Metal containers ( for packing of paints only )      3.300 U
ex 73.31.19      Nails                                                    92 T
73.32.10         Wood screws                                         400 kg
73.36.10         Space gas heaters for domestic use                  600 U
                                                                           V/
 ---pagebreak---                                    - 3fr-
    Cyprus Tariff                 Description of goods               Initial
       Heading                                                     Quant . /Value
73.38.12           Buckets , iron or steel                               136 U
ex 76.02          Aluminium bars                                        240 T
76.06             Aluminium tubes , pipes and hollow bars               190 T
83.02.10          Hinges ( of sizes 80 x 55 , 90 x 55 , 110 x 55 )      2.000 pc
83.13.10          Pilfer proof corks                                    423 th pc
                  Crown corks                                          2.520 thpc
83.15.10          Electrodes                                           16.200 Kg
84.18.93          Air oil and diesel fuel oil filters for cars         30.000 pc
84.56.10          Concrete mixers                                           20 U
85.04.10          Electrical accumulators for motor cars                1.500 U
93.07.10          Cartridges loaded                                    800.000 U
                  Cartridges empty                                     300.000 U
94.01 + 03        Furniture                                            C£ 2 mio
ex 97.03          Balloons                                              55 gross
                                1
     Notes :              pr = pair
 T “ Metric tonne    U = unit
 L = Litre           Kg = kilogramme
 th = thousand       Mio = million
 pc = piece          C£ = Cypriot pound
    ")
 ---pagebreak---                                        Annex 4
                        conceming Articles 16 , 17 , 22 and 23 .
    Cyprus Tariff                     Description of goods               C.C.T.
        Heading
06.03                    Cut flowers ( 2 )                          06.03 A
07.01.10                 New Potatoes                             07 . 01 . Alla )
                                                                             b) (3 )
07.01.90                 Chinese Cabbage ( 3 )                    07.01.B exIII
07.01.90                 Iceberg Lettuce ( 3 )                    07.01 . D ex II
07.01.90                 Fresh beans ( 1 )                         07.01FIIexa )
07.01.90                 Carrots ( 3 )                            07 . 01 . G. ex II
07.01.90                 Beetroot ( 2 )                           07 . 01 . G. ex IV
07.01.90                 Asparagus ( 1 )                           07.01 . K
07.01.90                 Artichokes ( 1 ) ( 4 )                    07.01.L
07.01.90                 Onions ( 1 )                              07.01 . & ex H
07.01.90                 Tomatoes ( 1 )                            07.01.M ex I
07.01.90                 a^eet Peppers ( 2 )                       07.01.S
07.01.90                 Courgettes ( 1 )                          07.01.T I
07.01.90                 Celery ( 1 )                              07.01T ex II I
07.01.90                Aubergines ( 3 )                           07.01T II
07.01.90                Okra                                       07.01Tex III
ex 07 . 04              Dried , dehydrated vegetables ( peppers )  07.04 ex B
08.01.90                Avocados                                   08.01     D
08.01.90                Mangos                                     08.01     ex  H
08.02                   Oranges fresh                              08.02     ex  A
08.02                   Mandarines , tangarines fresh              08.02     ex  B
08.02                   Lemons                                     08.02     ex  C
08.02                   Grapefruit                                 08.02     D
08.04                   Table grapes ( 3 )                        08.04 Alexa )
                                                                  ex b )
08.04                   Dried grapes ( 2 )                        08.04 B I
08.08                   Strawberries ( 1 )                        08 . 08 . A ex II
08.08                   Passion fruit                             08 . 08 . F ex II
ex 08.09                Melons ( 1 )                              ex 08.09
ex 08.09                Water melons ( 1 )                        ex 08.09
ex 08.09                Kiwi fruit ( 1 ) ( 4 )                    ex 08.09
ex 08.09                Persimmons ( kakis ) ( 1 )                ex 08.09
(1) Subject  to Comnunity  calendar
(2) Subject  to Comnunity  tariff quotas
(3) Subject  to Comnunity  calendar and Comnunity tariff quotas
(4) Subject  to Comnunity  reference quantities
 ---pagebreak---                                       -з-
     Cyprus Tariff                  Description of goods                   C.C.T.
        Heading
09.04                     Capsicums and piments                    09.04 A II c )
09.10                    Thyme , saffron and bay leaves            09.10 . A. I a )
                                                                                b)
                                                                               II
                                                                                B
                                                                                C I
                                                                                II
ex 12.03                 Seeds and plants                          12.03.E
12.07                    Aromatic plants                           12.07.D
12.08                    Locus beans ( and seeds )                 12.08.B + C
20.06.99                 Fruit salads                              20.06 B II a )
                                                                               ex 9
                                                                                b)
                                                                               ex 9
2Ö.09.99                 Grapefruit segments                       20.06 B II a ) 2
                                                                                ex 8
                                                                            B II b)2
                                                                                ex 8
                                                                            B II c ) 1
                                                                               ex dd )
                                                                            B II c ) 2
                                                                               ex bb )
20.07                    Orange juice                              A III ex a )
                                                                            ex b )
                                                                   B II a)l b)l
20.07                    Grapefruit juice                          A III ex a)exb )
                                                                   B II a ) 2 b ) 2
ex 20.07                 Grape juice ( including grapemust ) ( 2 ) 20.07 Bí
                                                                   a ) 1 , aa ) 11,22
                                *                                  b ) 1 , aa ) 11,22
ex 22.05                 Liqueur wines ( 2 )                       22.05 CII exa )
                                                                                exb )
                                                                            III a)ex2
                                                                                b)ex3
                                                                            IV   a)ex2
                                                                                b)ex3
ex 22.05                 Wines ( of fresh grapes ) ( 2 )           22.05 C I ex a )
                                                                                ex b )
                                                                             II ex a )
                                                                                ex b )
 ( 2 ) Subject to Community tariff quotas
 ( 4 ) Subject to Comnunity reference quantities
                                                                                <Κ
 ---pagebreak---                               Annex 5
                 conceming Articles 16 , 17 and 23
   Cyprus Tariff             Description of goods            C.C.T.
      Heading
20.06.99           Fruit salads                       20.06 B II a )
                                                                 ex 9
                                                                     b)
                                                                 ex 9
20.09.99           Grapefruit segments                20.06 B II a ) 2
                                                                     ex 8
                                                              B II b)2
                                                                     ex 8
                                                              B II c ) 1
                                                                 ex dd )
                                                              B II c ) 2
                                                                 ex bb )
20.07              Orange juice                       A III ex a )
                                                              ex b )
                                                      B II a ) 1 b)l
20.07             Grapefruit juice                    A III ex a)exb )
                                                      B II a ) 2 b ) 2
ex 20.07          Grape juice ( including grapemust ) 20.07 Bí
                                                      a ) 1 , aa ) 11,22
                                                               b)
                                                          1 , aa ) 11,22
ex 22.05          Liqueur wines                       22.05 CII exa )
                                                                   exb )
                                                              III a)ex2
                                                                   b)ex3
                                                              IV a)ex2
                                                                   b)ex3
ex 22.05          Wines ( of fresh grapes )           22.05 C I ex a )
                                                                   ex b )
                                                               II ex a )
                                                                   ex b )
 ---pagebreak---                                           M/ 0
                                      Annex 6
                               conceming Artide 16 and 24
  Cyprus Tariff                      Description of goods               Initial
        Heading                                                       Quantity
01.01.10                 Horses                                       12 horses
ex 02.01                  Beef                                         1.000 T
ex 03-01                 Frozen fish                                      400 T
                          ( excluding swordfish and trout )
03.02                    Dried salted fish ( excluding smoked trout )     150 T
03.03                    Crustaceans and molluscs                         150 T
ex 04.02.19              Milk sweetened in containers for retail       1.500 T
                         sale (*)
ex 04.02.19              Unsweetened concentrated milk ( evaporated )     500 T
                         in containers for retail sale (*)
04.03                    Butter·                                          450 T
ex 04.04                 Cheese and curd ( excluding kachkaval ,          600 T
                         touloum , halloumi , fetta , white cheese ,
                         kaseri , kefalotyri , gravyre from sheep/
                         goat/cow milk and the like )(*)
ex 07.01.10              Seed potatoes (*) ( 1 )                       7.000 T
09.02                    Tea                                              NQL
10.01                    Wheat                                            NQL
10.03                    Barley                                           NQL
10.05                    Maize                                            NQL
10.06                    Rice                                             NQL
11.01                    Cereal flours in retail packages of 1 1/2        400 T
                         kg or less
11.02                    Cereal groats ( excluding bulgur ) in re¬     1.400 T
                         tail packages of 1 1/2 kg or less
ex 15.07.91              Unrefined vegetable oils                      5.000 T
ex 15.07.99              Refined vegetable oils                        1.000 T
15.13                    Margarine (*)                                    600 T
17.01                    Sugar ( 2 )                                     NQL
ex 22.05                 Wines ( sparkling wines ) (*)                 180 HL
ex 23.01                 Flours and meals of fish crustaceans or       4.000 T
                         molluscs unfit for human consumption                ■·
ex 23.04                 Oil cake and other residues ( except dregs ) 11.000 T
                         resulting from the extraction of vegetable
                         oils
  NQL = No quantitative limit
  (*) These products are not subject to the provisions of Article 24
         paragraph 2
  ( 1 ) This quota could be reduced by 20 % in any one year in the event of
         production constraints .
  ( 2 ) Tariff dismantlement for imports originating in the Ccnniunity
         according to the timetable mentioned in Article 16 .
 ---pagebreak---                                      Annex 7
                         conceming Articles 11 , 12 and 24
 1 . The quantities in Annexes 1 , 3         3 . The Republic of Cyprus shall grant the
     and 6 shall be open in one                  licences for the quantities within a
     instalment at the beginning of              maximum period of 5 working days folio
     the calendar year .                         wing each request on the basis of
                                                 internal arrangements regarding allo¬
     However , the Republic of Cyprus            cation to Cypriot importers .
     may open these quantities in two
     or more equal instalments . In the     4 . The import licence shall be valid for
     case of both beef and cheese and            up to six months .
     curd these provisions will be
     subject to special arrangements         5 . The Republic of Cyprus shall
     to take into account local                  furnish information to the Com¬
     production . In that case the               mission annually on the use of the
     remainder of the previous                   quantities in Annexes 1 , 3 and 6 .
     instalments shall be carried
     over to the subsequent
     instalment so as to comply with
     the global annual amount .
2 . The Republic of Cyprus shall
     notify the Comnission each year
     of the global annual quantities
     opened .
 ---pagebreak---                              FINAL ACT
   The Plenipotentiaries of
  THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
  of the one part , and
  THE GOVERNMENT OF THE REPUBLIC OF CYPRUS ,
  of the other part ,
  meeting at Brussels on the
  for the signature of the Protocol laying down the conditions and procedures
  for the implementation of the second stage of the Agreement establishing
  an Association between the European Economic Community and the Republic of
  Cyprus and adapting certain provisions of the Agreement ,
  have , in signing this Protocol ,
  - adopted the following Joint Declarations by the Contracting Parties :
 1 .   Joint Declaration concerning Article 29 of the Protocol ;
 2 -   Joint Declaration concerning pro rata application of the Protocol ;
 3 .   Joint Déclaration concerning new potatoes ;
 4.     Joint Declaration concerning rules of origin .
- taken note of the following Declarations by the European Economic Community
1.      concerning a third financial protocol ;
 - taken note of the following Declarations by the Republic of Cyprus :
 1.   on the valuation of goods for customs purposes ;
2.    on Annex        Annex -5 and Annex 6 products ;
- and taken  en 'note
                'n<   of the following exchanges of letters :
 1.   Exchange of letters on the tariff quota for new potatoes referred to in
      Article 18 paragraph 1 ;
 2.   Exchange of letters on the tariff quota for cut flowers referred to in
      Article 19 paragraph 6 ;
 3.   Exchange of letters on a reduction in the levy on importations into the
       Community of Kaskav^J. cheese originating in Cyprus ;
                      ^                                       .    -
The declarations and exchanges of letters listed above are annexed to this
Final Act .
The Plenipotentiaries have agreed that the declarations ahd exchanges of
letters shall be subjected in the same manner as the Association Agreement ,
to any procedures that may be necessary to ensure their validity .
 ---pagebreak---  Joint Declaration concerning Article 29          of the Protocol laying
 down the conditions and procedures for the implementation of the
 Second Stage of the Agreement establishing an Association between the
 European Economic Community and Cyprus and adapting certain provisions
 of the Agreement
          It is the understanding of the Contracting Parties that
the completion of the second stage of the Agreement concerning the
establishment of a Customs Union shall be fully achieved within fifteen
years from the entry into force of the Protocol .
 ---pagebreak---                Joint Declaration by the Contracting Parties
          on Articles 11 , 12 , 18 , 19 , 22 and 24 of the Protocol
1.           The Contracting Parties are agreed that should the entry
into force of the Protocol not coincide with the start of the calendar
year, the quantitative limits referred to in Articles 11 , 12 , 18, 19 ,
22 and 2 4of the said Protocol shall be applied on a pro rata basis .
2.          The Contracting Parties are further agreed that the
charging against quantitative limits of Community imports of products
originating in Cyprus and Cypriot imports of products originating in
the Community subject to such limits under the Protocol shall begin
on 1 January of each year .
 ---pagebreak---                                               Ч <>
                 J OINT DECLARATION  BY THE CONTRACTING    PARTIES
       CONCERNING NEW POTATOES FALLING UNDER THE COMMON CUSTOMS TARIFF
                        HEADING NUMBER 07.01  A II  ex a )
           To avoid disturbance on the Community market ,        the Contracting
Parties agree to meet within an Advisory Working Party to examine the si¬
tuation on the potato markets ( state of harvests and supply situation )
both in the Community importing countries and in the Mediterranean expor¬
ting countries .    The members of this Working Party will be designated by
the Governments of the main exporting and importing countries .
                                         V
           The Working   Party , chaired   by the  Commission ,   would meet  at
least three times a year and in particular before sowing takes place in
the exporting countries , and at the time of deliveries .
          These meetings would enable the main potato- exporting countries
to be informed both about the receiving markets and about competing mar¬
kets , and their purposes would be to draw up indicative export timetables
designed to prevent delive rj^g s being 'concentrated around sensitive pe¬
riods for the Community market .
 ---pagebreak---                                         ии
 Joint Declaration by the Contracting Parties concerning the rules of
                                   'A
 ori gi n
                                                      «
              The Contracting Parties , taking into consideration the
 progressive application by Cyprus of the Common Customs Tariff
 during the second stage of the Agreement , agree that , for the
 purpose of the implementation of the Protocol concerning the
 definition of " originating” products and on methods of
 administrative cooperation , the special provisions mentioned
 in List A to that Protocol shall not be applicable to imocrts
 of products falling under tariff headings nos . 61.01 .
  2.           The Community has taken good note of the additional
  Cypriot demands for derogations under headings 61.02 and 61.03 . on
  which a decision will be taken in the appropriate bodies of the
  Community and of the Association Council within three months of the
  entry into force of this Protocol .
  3.           The Community declares its readiness to examine in the
  first phase of the second stage specific requests by Cyprus , duly
  substantiated , for further derogations from the rules of origin .
 4*            As to the abolition of rules of origin for trade in products
 covered by the customs union between the Community and Cyprus , the
 Council of Association will take a decision in the context of Article 30
 of the Protocol upon being' satisfied that Cyprus :
 - has completely adopted the Common Customs Tariff for those products
     in the customs union ;
 - has taken all measures to apply relevant Community trade policy measures ,
     concerning which the Community will inform the republic of Cyprus in due time .
              Such decision should be taken before - the end of the
 first phase as laid down in Article 1 paragraph 2 .
$
                                                                              Ίλ
 ---pagebreak---  Declaration by the European Economic Community concerning a
third financial protocol_
The Community reaffirms its willingness to examine, as from January 1 ,
1988, with the Republic of Cyprus the arrangements for financial
cooperation that could be made in a third financial protocol , taking
into account the new relationship established with the present
Protocol , which might put special emphasis on the financing of the
Cypriot productive sectors in order to facilitate their adjustment to
the new competitive conditions,.
                                                                        1Й
 ---pagebreak---                                    '■'СЬ
              Declaration by the Republic of Cyprus
          on the valuation of > goods for customs purposes
     The Government of the Republic of Cyprus declares that , with a
 view to facilitating the passage to the second stage of the Agreement
 between the Community and Cyprus and to ensuring the uniform appli ¬
 cation of the Common Customs Tariff , Cyprus will :
 - take the necessary steps to accept the Agreement on Implementation
   of Article VII of the General Agreement on Tariffs and Trade ( GATT
   Valuation Code ) and , no later than the date of entry into force
   of the Protocol laying down the conditions and procedures for the
   implementation of the second stage of the Agreement establishing
   an Association between the European Economic Community and the
   Republic of Cyprus and adapting certain provisions of the Agreement ,
   to apply the GATT Valuation Code ,
- no later than the end of the first phase of the second stage adapt
   its legislation to bring it into conformity with the Community 's
   provisions on valuation of goods for customs purposes ,
- maintain close consultation with the Commission of the European
   Communities on matters regarding the application of the aforesaid
   Code and that of the aforesaid legislation and provisions .
1
                                                                       »
 ---pagebreak---                          Declaration by the Republic of Cyprus
       concerning the products of Annex \, Annex 5 and Annex 6 of the Protocol
Laying down the conditions and procedures for the implementation of the second stage
                                    of the Agreeraent
       The Goverment of the Republic of Cyprus declares that in respect of
 the products in Annexes 1 , 5 and 6 of the Protocol Cyprus will ensure that
 the General Customs Tariff of Cyprus is not increased on these products originating
 in the Community and that the application of the import licensing system does not
 damage the Community 's traditional trade in the same products . In cases where measures
 may appear necessary in the interests of the balanced development of the Cypriot eco¬
 nomy prior information will be given to the Community which may give rise to
 consultations within the Association Council .
                                                                                di
 ---pagebreak---                                               9>
                              Exchange of Letters
                 between the European Economic Community and Cyprus
                       as regards imports into the Community
                       of new potatoes originating in Cyprus
 ( Politeness formula ),
 1.         Under the terms of Article 18 paragraph 1 of the protocol laying
down the conditions and procedures for the second stage of the Agreement
establishing an Association between the European Economic Community and
the Republic of Cyprus , and adapting certain provisions of the Agreement
 ( 1 ), signed in Brussels on ( date ), a concession is provided for new pota¬
toes falling within sub heading 07-01 A II b ) of the Common Customs
Tariff .
2.             In the context of this concession Cyprus undertakes to ensure
that , in future , its exports of this product to the Community will be
principally channelled towards its main traditional markets .
3.          In order to put this concession into operation , I would be plea¬
sed if you could confirm the acceptance by the Government of Cyprus of
the condition mentioned in paragraph 2 of this letter .
            ( Politeness formula )
( 1 ) JO N® L        of     page
 ---pagebreak---                                                . Si
                            Exchange of letters between
                     the European Economic Corrmunity and Cyprus
            as regards imports into the Community of fresh cut flowers
                       and flower buds originating in Cyprus
  ( Politeness formula )
 1.            Article 19 paragraph 5 of the Protocol laying down the condi
 tions and procedures for the implementation of the second stage of the
 Agreement establishing an Association between the European Economic Com¬
 munity and the Republic of Cyprus and adapting certain provisions of the
 Agreement ( 1 ) provides for the progressive elimination of customs duties
 on imports into the Conmunity of fresh cut flowers and flower buds
 falling under heading 06-03 A of the Common Customs Tariff , originating
 in Cyprus , subject to a limit of 50 tonnes .
 2.          For roses and carnations qualifying for this tariff dismantling ,
 Cyprus undertakes to respect the price level on import into the Conmunity
as defined below :
             The price level on import into the Conmunity must be at least
equal to 85 % of the Conmunity price level for the same products over the
same periods .
- The Cypriot price level shall be determined by the registration of the
prices of imported products , customs duties not deducted , on the repre¬
sentative Community import markets .
- The Conmunity price level shall be based on producer prices registered
on representative markets of the main producer Member States .
- For the analysis of Conmunity producer prices and the import prices of
Cypriot products , two types of roses shall be distinguished , those with
large and with small flowers , and for carnations , the uni floral and mul¬
tifloral types .
3.          If during two successive market days , for the same type of pro¬
duct and for at least 30 % of the quantities imported into the Conmunity
for which price quotations are available , the Cypriot price level is be¬
low 85 % of the Conmunity price level , the preferential tariff shall be
suspended .
( 1 ) 0J N * L      of    page
                                                                          7?/
 ---pagebreak---                                      - S2 -
 4.         The Community will restore the tariff preference after registe¬
 ring a Cypriot , price level equal or superior to 85 % of the Community
price level during two successive maxket days , or six successive working
days in the absence of quotations for products originating in Cyprus .
 5         If, over five to seven successive market days , the Cypriot price
level fluctuates around 85 % of the Community price level and is below
this limit for three days , the tariff preference shall be suspended for a
period of six days . However , the preferential customs duty shall be res¬
tored by the Community if , during three successive market days , a Cypriot
price level is registered equal or superior to that of the Community pri¬
ce level .
6.         In order to put this concession into operation , I would be
pleased if you could confirm the acceptance by the Government of Cyprus
of the conditions mentioned in paragraphs 2, 3 , 4 and 5 .
                                                   ( politeness formula )
( 1)' JO N  L        of      page
 ---pagebreak---                                             ø
                              Exchange of letters
                between the European Economic Conmunity and Cyprus
                as regards imports of Kaskaval cheese originating
                                     in Cyprus
 ( Politeness formula )
 1.           Pursuant to Article 19 paragraph 6 of the Protocol laying down
 the conditions and procedures for the second stage of the Agreement
 establishing an Association between the European Economic Conmunity and
the Republic of Cyprus , and adapting certain provisions of the Agreement
 ( 1 ), Kaskaval cheese from the Corrmon Customs Tariff heading 04.04 E.I b
 2 , originating in Cyprus will be able to obtain a reduction in the levy
on import into the European Economic Conmunity . After the reduction the
resulting levy shall be fixed at the level of 65,61 Ecu/ 100 kg .
2.           The above reduction in the levy is subject to the respect by the
certifying authorities in Cyprus of the provisions of Commission Regula¬
tion ( EEC ) n * 1767/82 , and to the condition that the cheeses mentioned in
paragraph 1 of this letter are exported to the European Economic Cormuni-
ty at the Conmunity free-afc.- frontier' price fixed for these cheeses by
Council Regulation ( EEC ) n * 2915 / 79 , and to approval by the Commission of
the agencies authorised to certify these products on export from Cyprus .
3.           In order to put this concession into operation , I would be plea¬
sed^ if you could confirm the acceptance by the Government of Cyprus of
the conditions mentioned in paragraph 2 of this letter .
                                                        ( Politeness formula )
( 1 ) J0   N       of      page
                                   \
 ---pagebreak---                                                 Brussels , 22 May 1987
 Mr Eberhard Rhein
 Head of the Community Delegation
Subject :  Article 26 , paragraph 2 of the Protocol
Dear Mr Rhein ,
On behalf of the Government of the Republic of Cyprus I should
like to inform you that in Article 26 , paragraph 2 the phrase
" Cyprus will adopt under its own responsibility ..." includes
all financial obligations that might arise from the implemen¬
tation of the provisions of Article 26 .
                                           Yours sincerely ,
                                         0 4            b
                                          Iacpvos Aristidou
                                       Head Jbf Delegation of
                                       the Republic of Cyprus
 ---pagebreak---                        COMMISSION                                                Brussels                22 May 1987
                       OF THE EUROPEEN
                       COMMUNITIES
           Oiraclorata-Ganaral
           Extamal Raiationj
                   Mr Iacovos Aristidou
                   Head of Delegation of
                   the Republic of Cyprus
                    Dear Mr Aristidou ,
                    Thank you for your letter concerning Article 26 , paragraph 2 of
                   the Protocol of which I take note .
                                                                                Yours sincerely ,
                                                                                1U.
                                                                                Eberhard Rhein
                                                                      Head of the Community Delegation
Provwon»l addrass Rua da la Loi 200 • B-IW9 BnjsscU - Baigium - Talaphona diract lina 23     lalapnona axcfianga 235 11 11 a 236 1111
Tala* COMEU B 21877 - Talagrapnic addras» COMEUR Bruaaali
 ---pagebreak---                                   T6
                                                Brussels , 22 May 1987
Mr Eberhard Rhein
Head of the Community Delegation
Subject :  Articles 18 and 19 of the Protocol
Dear Mr Rhein ,
The Government of the Republic of Cyprus wishes to point out that
a number of its requests concerning further concessions on
agricultural products have not been met by the Community despite
the fact that Cyprus is moving towards a customs union with the
EEC . These requests refer particularly , inter alia , to the
calendars for table grapes , asparagus , artichokes and kiwi , to
tariff concessions on bananas , grape juice ( TH 20.07 AI ) and
canned grapes ( seedless ) as well as an annual increase of 5 X on
the tariff quota for bulk wine of fresh grapes , and reduction of
levy on Halloumi cheese .
The Government of Cyprus urges the Community to examine positively
these requests .
                                       Yours sincerely ,
                                      Iaaovos Aristtdou
                                      Iadovos
                                    Head / of Delegation of
                                    the Republic of Cyprus
 ---pagebreak---                                                                          <y
                                                                             Brussels                       22 May 1987
                     COMMISSION
                     OF THE EUROPEAN
                     COMMUNITIES
         Dir«ctor»t»-G»ner»l
          ExMmal Relation»
                 Mr lacovos Aristidou
                 Head of Delegation of
                 the Republic of Cyprus
                 Dear Mr Aristidou ,
                 Thank you for your letter concerning Articles 18 and 19 of the
                 Protocol of which I take note . The Commission will examine
                 carefully such requests with a view to making appropriate
                 proposals .
                                                                                Yours sincerely ,
                                                                                "UL
                                                                                Eberhard Rhein
                                                                         Head of the Community Delegation
ProviWooW addraaa: Bu» da I» Loi 200 • S- 1049 BTUSMI» - Batgium - Talephon* diract lin» 23     tt»«phon# «xchang« 235 11 11 • 236 1111
T»l»x COMEU B 21877 - TalagrapHic »ddrms COMEUR Bruucli
 ---pagebreak--- Incidence on Small and Medium-sized Enterprises
The implementation of the customs union between the European Economic Commu¬
nity and Cyprus will result in Cyprus progressively abolishing over 10 years
duties and other barriers to trade for products originating in the Community .
This process will have a positive effect , albeit modest , on small and medium
term enterprises since the customs union should give them the possibility
to compete more effectively on the Cypriot market .