title: RECOMMENDATION FOR A COUNCIL REGULATION concluding an Agreement between the European Economic Community and Socialist Federal Republic of Yugoslavia on Trade in Textiles (submitted to the Council by the Commission)

text:
ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (77) 21
Vol. 1977/0008
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                         COM(77)21 final
                                         Brussels , 11 February 1977
                 RECOMMENDATION FOR A COUNCIL REGULATION
            concluding an Agreement between the European Economic
            Community and Socialist Federal Republic of Yugoslavia
                          on Trade in Textiles
                 ( submitted to the Council by the Commission )
 C0M(77 ) 21 final
 ---pagebreak---                          EXPLANATORY MEMORANDUM
1.    By a decision of 1o December 1975 » the Council authorized the
Commission to open negotiations with Yugoslavia for the conclusion
of an Agreement oil trade in textile products based on the provisions
of Article k of the Arrangement on International Trade in Textiles .*
2.    In accordance with the above Council Decision and in consultation
with the Article 113 Committee , the Commission conducted negotiations
with the Socialist Federal Republic of Yugoslavia during the months
of March and June 1976 .
      Following these negotiations a draft agreement was drawn up . The
Agreement which cover the period from 1.1.76 to 31.12.77 makes provision
for ;
           - voluntary restraint , at agreed levels , on exports to the
             Community of certain categories of textile products in
             tended for consumption within the Community ;
          – the adoption of a surveillance and consultation procedure
             applicable to certain categories of products and permitting ,
             inter alia , the establishment on agreed terms of voluntary
             restraint measures for the products in question ;
           - the corresponding undertaking by the Community to suspend
             the quantitative limitations at present in force and not
             to invoke the safequard provisions of the Multifibre
             Arrangement for the categories of products covered by the
             agreement so long as the agreed ceilings are observed .
             Moreover the Agreement does not apply to reimporte into
             the Community of articles processed 6r transformed in
             Yugoslavia , of products temporarily exported from the
             Community .
      The heads of the delegations found the draft Agreement to be in
accordance with the results of the negotiations and initialled the text
on 25 June 1976 .
3.    In order to assure the achievement of the objectives of the Agree
ment , the two parties have agreed that while awaiting the completion of
the procedures necessary for the conclusion of the Agreement , its
 ---pagebreak---                                 ~ 2 -
provisions be applied de facto , by both sides , as from July 1 . 1976 .
*f . The Commission considers that this draft agreement constitues
a result that is acceptable to the Community . It proposes that the
Council conclude this Agreement by adopting the draft regulation
annexed hereto *
     The measures necessary for the application by the Community of
the provisions of the Agreement are the subject of a separate Commission
proposal to the Council for a Regulation .
 ---pagebreak---                 RECOMMENDATION FOR A REGULATION OF THE COUNCIL
           concluding an Agreement between the European Economic
           Community and Socialist Federal Republic of Yugoslavia
                    on Trade in Textiles
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic
Community , and in particular Article 113 thereof ,
Having regard to the recommendation from the Commission , '
Whereas the Agreement on Trade in Textiles negotiated between the
European Economic Community and the Socialist Federal Republic of
Yugoslavia should be concluded ,
HAS ADOPTED THIS REGULATION :
                             Article 1
     The Agreement between the European Economic Community and the
Socialist Federal Republic of Yugoslavia on Trade in Textiles , the
text of which is given in the Annex , is hereby concluded on behalf
of the Community .
                             Article 2
     The President of the Council shall notify the other Contracting
Party of the accomplishment by the Community of the procedures
required for the entry into force of the Agreement .
                             Article 3
     This Regulation shall enter into force on the third day following
its publication in the Official Journal of the European Communities .
Done at Brussels ,                          For the Council ,
                                            The President
 ---pagebreak---                  AGREEMENT
  BETWEEN THE EUROPEAN ECONOMIC COMMUNITY
                    AND
THE SOCIALIST FEDERAL REPUBLIC OP YUGOSLAVIA
            ON TRADE IN TEXTILES
                             ( Text initialled on 25 June 1976 )
 ---pagebreak--- The Council of the European Communities ,
of the one part , and
the Government of the Socialist Federal Republic of Yugoslavia ,
of the other part ,
Desiring to ensure the orderly and equitable development of trade in
textiles between the European Economic Community , hereinafter
referred to as the " Community" , and Yugoslavia , and having regard
to their respective levels of development ;
Having regard to the provisions of the Arrangement regarding International
Trade in Textiles ( hereinafter referred to as the " Geneva Arrangement")
and in particular Article 4 thereof :
Have decided , in a spirit of mutual cooperation and in conformity
with the Geneva Arrangement , to conclude this Agreement and
to this end have designated as their Plenipotentiaries :
THE COUNCIL OF THE EUROPEAN COMMUNITIES :
THE GOVERNMENT OF THEJSOCIALIST FEDERAL REPUBLIC OF YUGOSLAVIA :
Who have agreed as follows :
 ---pagebreak---                              Article 1
 1 . The Parties recognize and confirm that , subject to the
provisions of this Agreement and without prejudice to their
rights and obligations under the General Agreement on Tariffs
and Trade , the conduct of their mutual trade in textiles shall
be governed by the provisions of the Geneva Arrangement .
2 . This Agreement shall apply to trade in those categories of
textile products , originating in and coming from Yugoslavia ,
which are listed in Annexes I and II to this Agreement .
3 . Yugoslavia shall establish quantitative limits on exports
to the Community in accordance with the schedule set out in
Annex I.
4 . Quantities of the quota shares set out in Annex I not taken
up by a Member State of the Community may be reallocated to
another Member State within the limits decided by the Community
in accordance with the procedures in force in the Community .
The Community undertakes to respond within four weeks of its
receipt to any request made by Yugoslavia for such reallocation .
It is undertstood that any reallocation so effected would not
need to be confined within any limits set in provisions flexibility
established elsewhere in this Agreement .
 ---pagebreak---                                 Article 2
1 . The Community undertakes , in respect of the categories of textile
products to which this Agreement applies , and subject to the
satisfactory operation of this Agreement , not to introduce new
quantitative restrictions , to suspend immediately the application
of any at present in force and to refrain from invoking the
provisions of Article 3 of the Geneva Arrangement provided that
exports to the Community of such textile products originating in
and coming from Yugoslavia do not exceed the quantitative limits
established under the provisions of this Agreement .
2 . The Yugoslav authorities undertake to take all appropriate
measures to ensure that the agreed quantitative limits are not
exceeded .
3 . The Community shall not object to the above quantitative
limits being exceeded in the event of additional demand on the
Community market , on the understanding that the additional
quantities shall be fixed by common accord of both Parties .
 ---pagebreak---                               Article 3
 1.  Imports into the Community of textile products to which this
Agreement applies which are for immediate re-export or for
 inward processing and subsequent re-export outside the Community
 shall not be subject to the quantitative limits established
under this Agreement , provided they are entered as such under
 an administrative system of control in force for this purpose
within the Community .
2 . Where Community authorities ascertain that imports referred
to in paragraph 1 above have been retained for use within the
Community , the latter will notify the Government of Yugoslavia
on a quarterly basis of the amounts involved . Yugoslavia shall
in such cases and at the request of the Community set off such
amounts against the quantitative limit or limits in question for
the current Agreement year or for the following year.
3 . Where the authorities in the Community ascertain under an
administrative system of control in force that imports of
textile products covered by this Agreement have been set off
against quantitative limits established under this Agreement
but have been subsequently re-exported outside the Community ,
the authorities concerned will inform the Yugoslav authorities
of the quantities involved and authorize imports of equivalent
quantities , which shall not be set off against the quantitative
limits \inder the Agreement .
4 . Re-imports into the Community of textile products to which
this Agreement applies and which have been temporarily exported
by the Community in accordance with the procedures in force in
the Community and undergone working or processing in Yugoslavia
shall not be subject to the quantitative limits established
under the Agreement .
 ---pagebreak---                                Article 4
 1# Both Parties agree "to enter promptly into consultations with
 each, otherf at the request of either and in conformity with the
provisions of the Geneva Arrangement , on any matter concerning their
trade in textiles and in particular on any problems arising from
this Agreement .   Consultations held under this Article shall be
approached by both Parties in a spirit of compromise and with
a view to the conciliation of differences existing between thera.
2.   The Community may , whenever imports of products originating
in and coming from Yugoslavia and listed in Annex II cause real
risks of market disruption ( within the meaning of Annex A to the
Geneva Arrangement ), request consultations with Yugoslavia with
regard to these products in accordance with the procedure laid
down in paragraph 5 «
3.   If it is ascertained that there is an excessive concentration
of trade in a product within a category for which quantitative
limits have been established by the Community under the terms
of this Agreement or which is otherwise subject to the provisions
of this Article and if , in the opinion of the Community , there is
a risk of such concentration causing real market disruption in
respect of this product , the Community may request consultations
with Yugoslavia under identical conditions to those specified
in paragraph 5 below .
4.   The requests for consultations referred to in paragraphs 2 and 3
above shall be followed within a reasonable period ( at the latest
within 21 days ) by a report on the conditions on the Community
market which , in the opinion of the Community, justify such a request
This report shall contain information demonstrating the existence
of real risks of disruption to this market (within the meaning
of Annex A to the Geneva Arrangement ). The consultation procedures
referred to in this paragraph shall be used in moderation and only
in the event of substantial changes in the level of exports of
Yugoslav products to the Community and shall be applied with due
regard for the principles and aims of the Geneva Arrangement .
 ---pagebreak---                                                               (Article 4 continued.)
 5 . pending a mutually sa.tsifa.ctory conclusion of the consultations
 provided for in paragraph 2 , Yugoslavia shall limit its exports
 of the product or products in question to the Community to the
 higher of the following two levels ;
   ( i ) one hundred and seven percent ( 107%) of the exports of the
          product or products to the Community during the most recent
          twelve-month period preceding the month in which the request
          for consultations was made for which statistics are available
          for the two Parties ;   or
 ( ii )   the average annual exports of the product or products from
          Yugoslavia to the Community for any three-year period within
          the six years preceding the month in which the request for
          consultations was raa.de for which statistics are available
          for the two Parties ,
o „ The Community shall authorize the importation of goods dispatched
from Yugoslavia before the date on which the request for consultations
was made . Moreover , the Community shall examine attentively and
give its favourable consideration to arrangements for goods for which
export licences have been issued on the basis of bona fide contracts
and letters of credit . If the Yugoslav authorities consider that the
application of these provisions gives rise to problems which damage
the trade interests in question , Yugoslavia may request consultations
with the Community in accordance with paragraph 2 above .
7.      Consultations shall be held at the request of Yugoslavia in order
to review the need for the maintenance , modification or abolition
of any quantitative limits established under this Article , whenever
the market conditions which led to the establishment of such limits
no longer prevail .
8.      In the event of the Parties being unable to reach agreement in
the consultations provided for in this Article , either of them may ,
as a signatory to the Geneva Arrangement , refer the matter to the
Textiles Surveillance Body in accordance with Article 11 of the
Geneva Arrangement . Either Party choosing such a course of action
shall immediately notify the other of its intention .
 ---pagebreak---                                  Article 5
1 . Portions of any quantitative limit established under this Agreement
which are not used during any Agreement year may be carried over and
added to the corresponding quantitative limits for the following year ,
within a limit of 10% of the latter .
2 . Within a limit of 10% of each quantitative limit established under
this Agreement , advance deliveries shall be authorized from the
corresponding quantitative limit in force for the following Agreement
year . Amount s dispatched in advance shall be deducted from the
quantitative limits for the products in question for the following year .
3 . Within any one Agreement year , unused portions of quantitative limits
established under this Agreement may be transferred to another
quantitative limit under the conditions set out below:
    ( i ) to category 55*09 (other woven fabrics of cotton) and , therein,
          to subcategory ex 55*09 (cotton fabrics , other than unbleached
          or bleached ) from category ex 62.02 (bed linen, table linen,
          toilet linen and kitchen linen ;  curtains and other furnishing
          articles of cotton except net curtains ), provided that such
          transfers do not exceed 10% of the quantitative limit to which
          they are made ;
  ( ii ) to category ex 62.02 (bed linen , table linen, toilet linen and
          kitchen linen ;  curtains and other furnishing articles of cotton
          except net curtains ) from category 55*09 ( other woven fabrics of
          cotton), provided that such transfers do not exceed 7% of the
          quantitative limit to which they are made ;
( iii ) within category 55*09 ( other woven fabrics of cotton), to
          subcategory ex 55*09 (cotton fabrics , other than unbleached or
          bleached ), provided that such transfers do not exceed 7% of the
          quantitative limit for the subcategory to which they are made .
 ---pagebreak---                                                           (Article 5 continued.)
4.  The flexibility provisions set out in paragraphs 1 , 2 and. 3
must not , in any given Agreement year , result in the quantitative
limit for any category being exceeded, by more than 15% of the
quantitative limit for that category for that Agreement year .
5.  The flexibility provisions set out in paragraphs 1 , 2 and. 3 may
be applied by Yugoslavia only following written notification to the
Community by the Yugoslav authorities .
 ---pagebreak---                                  - 9 -
                              Article 6
Yugoslavia shall make every endeavour to ensure thai; exports of all
textile products for which quantitative limits may "be established under
this Agreement are spaced out as evenly as possible over each Agreement
year , due account "being taken , in particular , of seasonal factors .
 ---pagebreak---                                - 10 -
                              Article 7
The "two Parties agree to exchange all relevant information concerning
their mutual trade in textiles in order to ensure the smooth functioning
of this Agreement .
 ---pagebreak---                               Article 8
 1.   The Parties agree "that the quantitative limits established under this
Agreement shall "be managed under a system of double control , the details
 of which are set out in Annex III .
 2.   Yugoslavia therefore undertakes to furnish the Community with precise
 statistical information , on a quarterly "basis , on all export licences issued
"by the Yugoslav    authorities for all categories of textile exports to the
 Community covered "by this Agreement .
 3.   The Community shall likewise forward to the Yugoslav authorities on a
 quarterly "basis precise statistical information on imports of such products
 into the Community .
 ---pagebreak---                                - 12 -
                            Article 9
1.   Both Parties shall take all appropriate measures to ensure that the
traditional trade flows and commercial practices are maintained "between
the Community and Yugoslavia .
2.   Should either Party inform the other that the functioning of this
Agreement has given rise to difficulties regarding the maintenance of
existing commercial relations "between importers in the Community and
their suppliers in Yugoslavia , the Parties agree to consult together in
accordance with the procedures set out in Article 4(l ) above .
 ---pagebreak---                              Article 10
Without prejudice to the other provisions of this Agreement , Yugoslavia
agrees that the quantitative restrictions on imports into Ireland of the
following textile products from Yugoslavia may be maintained until
30 June 1977 at the latest .
BTN 55.05   Cotton yarn , not put up for retail sale
     55.06  Cotton yarn , put up for retail sale
     55.07  Cotton gauze .
 ---pagebreak---                                - 14 -
                             Article 11
This Agreement shall apply to the territories where the Treaty establishing
the European Economic Community applies , on the conditions laid down in
that Treaty , and to the territory of Yugoslavia.
 ---pagebreak---                                - 15 -
                            ■ Article 12
1.   This Agreement shall enter into force on the first day of the month
following the date on which the Parties have notified each other of the
completion of the procedures necessary for that purpose .   It shall remain
applicable until 31 December 1977 *
2.   This Agreement shall enter into force on 1 January 1976 .
3.   Either Party may at any time propose modifications to this Agreement
or denounce it provided that notice is given at least 120 days before the
expiry of any twelve-month period ;   in the latter event the Agreement will
come to an end at the expiry of the said twelve-month period .
4.   The Annexes and Protocols to this Agreement shall form an integral
part thereof .
 ---pagebreak---                                    - 16 -
                                 Article 13
This Agreement shall toe drawn up in "two copies in the Danish , Dutch ,
English , French , German , Italian and Serbo-Croat languages , each of
these texts "being equally authentic .
 ---pagebreak---                                                                           Annex I
                                              Products
             m respect of which Yugoslavia will exercise
             voluntary restraint vis-a-vis the Community as
             a whole from the entry into force of the Agreement
The Community hereby informs Yugoslavia that the quantitative limits
for the textile products listed below will "be allocated between the
Member States as follows ;
r~–                                                                Quantitative limits |
I commun
  Γ»,,
  n,, –4-
               Nimex     !     <"» S* «S 4- -1 AM      I
                                                         Member I    (metric tons )
               Code      1
IUUfciUUU1B
  Tariff No
                                                         State
                                                                      1976     1977
       55.09   01 to         Other woven fabrics I        FRG         2 774    3 097
               98            of cotton                    F             863    1 012
                                                          I           6 443    6 475
                                                          BUL         1 264    1 367
                                                          UK     !      525       675
                                                          IRL            10         15
                                                          DK            900       905
                                                          EEC        12 779   13 546
I of which
  ex 55.09                   Cotton fabrics , other       FRG           459 !     497
                             than unbleached or           Ρ              94       116
                             bleached                     I             372       374
                                                          BNL           238       244
                                                          UK             21         31
                                                          IRL              4         5
                                                          DK            237       238
                                                          EEC         1 425     1 505
   ex 62.02 B 11 , 41 ,      Bed linen , table            FRG           276       299
               43 , 47 ,     linen , toilet linen         F             175       189
               71 , 73 , !   and kitchen linen :          I             186       193
               81            curtains and other           BEL           190       191
                             furnishing articles          UK             21         31
                             of cotton except net         IRL              5         6
                           I curtains                     DK             99       100
                                                          EEC           952    1 009
 ---pagebreak---                                 - 18 -
                                                              Annex II
Products subject to the special consultation procedure provided for in
Article 4
Common Customs
                                       Description
Tariff Wo
55.05            Cotton yarn ,   not put up for retail sale
56.07            Woven fabrics of man-made fibres (discontinuous or waste )
ex 60.03         Men's socks                                                j
60.04            Under garments ,   knitted or crocheted , not elastic nor
                 rubberized
60.05 A          Knitted or crocheted outer garments
61.01            Men 's and boys * outer garments
61.02            Women 's , girls' and infants' outer garments
61.03            Men 's and boys' under garments , including collars ,
                 shirt fronts and cuffs
ex 62.02         Bed linen , table linen , toilet linen and kitchen linen ;
                 curtains and other furnishing articles ( other than the
                 products listed under subheading ex 62.02 B in Annex i )
 ---pagebreak---                                  - 19 -
                                                                Annex III
As agreed between "the Parties in Article 8 of "the Agreement , the administration
of textile imports from Yugoslavia will "be "based on a system of double
control .   The details of this system have "been agreed between the Parties
and are set out "below .
The authorities in the Community will , automatically and without delay ,
accept imports of textile products on submission of the importer 's
application together with the original escort licence issued "by the Yugoslav
authorities .    The authorities in the Community will be entitled to request
the presentation of an export licence in respect of goods originating in
Yugoslavia of the categories shown in Annex I and , where Article 4 has been
invoked , in Annex II .   These export licences will be issued by the Yugoslav
Government authorities up to the total amount of the agreed quantitative
limits .
The export licence must specify :
1.   destination
2.   sériai number
3.   importer' s name and address
4.   exporter' s name and address
 5 . net weight ( in metric tons ) and value
 6.  category and classification of product
7.   certificate issued by the Yugoslav authorities showing that the
     quantity has been debited against the agreed ceiling for exports to
     the Community or , where appropriate , is for immediate re-export or
     for processing and subsequent re–export outside the Community .
The authorities in the Community will not raise difficulties in the event
 of a discrepancy between the weight indicated on the export licence and
 the shipment or import weight provided it is within reasonable limits ,
while the Yugoslav authorities , for their part , will endeavour to keep any
 discrepancies to a minimum.
 ---pagebreak---                                 20 -
                                                            Annex III ( contd.)
In the event of total or partial withdrawal of an export licence, the
Yugoslav authorities will notify the relevant authorities in the Community
of such total or partial withdrawal .   The authorities in the Community
will take the appropriate measures in accordance with their existing
administrative provisions .
The Yugoslav authorities will forward to the authorities in the Community ,
via the Embassies of the Member States of the Community and directly to
the Commission , quarterly returns showing the total net weight in metric
tons covered by the export licences issued against the ceilings for exports
to the Community , as well as the allocation of these licences among the
Member States of the Community for each category of textile exports to the
Community subject to a quantitative limit under this Agreement .
 ---pagebreak---      COMMISSION                             - 21 -
       OP THE
EUROPEAN COMMUMTIES                                                         Annex IV
Directorate-General
or External Relations
             Sir ,
             In concluding the negotiations held between the Community and the
             Government of Yugoslavia which have led this day to the signing of an
            Agreement regarding trade in textile products , the Community has the
            honour to inform you of the following :
            As stated in Article 3(4 )» "the Agreement does not apply to re-imports from
            Yugoslavia of textile articles produced "by the working or processing of
            products temporarily exported from the Community.
             The Community recognizes the economic importance of such working and
            processing operations for Yugoslavia.     Vfhile reserving , therefore , the
             right to adopt unilateral measures to regulate this trade , "by subjecting
             it to authorization , the Community will endeavour to maintain such trade
             channels as exist under the current arrangements .
             I should he grateful for your confirmation of your Governments agreement
            with the above .                     n
            Please accept , Sir . the assurance of my highest consideration.
            ;