Help Print this page 

Document 52016PC0631

Title and reference
Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the introduction of temporary autonomous trade measures for Ukraine supplementing the trade concessions available under the Association Agreement

COM/2016/0631 final - 2016/0308 (COD)
  • No longer in force
Multilingual display
Text

Brussels, 29.9.2016

COM(2016) 631 final

2016/0308(COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the introduction of temporary autonomous trade measures for Ukraine supplementing the trade concessions available under the Association Agreement


EXPLANATORY MEMORANDUM

1.CONTEXT OF THE PROPOSAL

Reasons for and objectives of the proposal

The Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part (hereinafter referred to as ‘the Agreement’), was signed by the Parties in two parts, in March and June 2014. The Association Agreement has been provisionally applied in some parts since 1 November 2014. The Deep and Comprehensive Free Trade Area (DCFTA) has been provisionally applied since 1 January 2016.

One of the objectives of the Agreement is to establish conditions for enhanced economic and trade relations leading towards Ukraine's gradual integration with the EU Internal Market, including by setting up a Deep and Comprehensive Free Trade Area as stipulated in Title IV (Trade and Trade-related Matters) of the Agreement, and to support Ukraine's efforts to complete the transition into a functioning market economy by means of, inter alia, the progressive approximation of its legislation to that of the Union.

In order to increase the existing trade flows concerning the import of certain agricultural products from Ukraine into the Union, and to foster bilateral trade and economic cooperation with the Union, it is appropriate to grant additional autonomous trade preferences for Ukraine.

The new autonomous measures would respect the same basic principles as those enshrined in the Association Agreement between the EU and Ukraine. In particular, Article 2 of the Association Agreement with Ukraine provides that the respect for democratic principles, human rights and fundamental freedoms and respect for the principle of the rule of law, constitute essential elements of that Agreement. 

The autonomous trade measures provided for under the present Regulation are subject to the respect of these same principles by Ukraine.

Normal safeguard procedures apply.

Consistency with existing policy provisions in the policy area

The new autonomous trade measures would be consistent with the implementation of the EU-Ukraine Association Agreement and in particular with the provisional application of Title IV of the DCFTA from 1 January 2016.

Furthermore, recent FTAs negotiated by the European Union (notably with Peru and Colombia, with Central America, with Vietnam and with Canada) have already provided unlimited duty-free access for some of the agricultural products covered by the present Regulation.

Consistency with other Union policies

The European Union has so far supported Ukraine's political and economic stabilisation and the consolidation of the reforms in particular in the areas of justice and fight against corruption, building capacity of public administration, as well as decentralisation. An extensive support package of €12.8 billion includes Macro-Financial Assistance as well as numerous technical and financial assistance projects through annual Special Measures, and the assistance provided by the EIB among other International Financial Institutions to the implementation of the DCFTA.

2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

Legal basis

The legal basis for the proposal is Article 207(2) of the Treaty on the Functioning of the European Union.

Subsidiarity (for non-exclusive competence)

The common commercial policy, in accordance with Article 3 of the TFEU, is defined as an exclusive Union competence. Therefore, the subsidiarity principle does not apply.

Proportionality

This proposal is necessary in order to implement the common commercial policy.

Choice of the instrument

This proposal is in accordance with Article 207(2) TFEU, which envisages measures implementing the common commercial policy. There exists no other legal instrument that could be used in order to achieve the objective expressed in this proposal.

3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS

Ex-post evaluations/fitness checks of existing legislation

Not applicable.

Stakeholder consultations

Stakeholder consultations were carried out in the framework of the sustainability impact assessment commissioned by DG Trade in 2007 which fed into the DCFTA negotiation process. Moreover, the measure is to be adopted in co-decision. It will therefore be put under the scrutiny of the EU Council and the European Parliament.

Collection and use of expertise

Not applicable.

Impact assessment

In view of the difficult economic situation in Ukraine, it is important for the Regulation to enter into force as soon as possible. Therefore no impact assessment was carried out for the measure at hand. However, the trade and trade-related provisions of the Agreement have been subject to the sustainability impact assessment mentioned above. That study confirmed that implementation of trade and trade-related provisions would have a positive economic impact for the EU as well as for Ukraine.

Regulatory fitness and simplification

The measure does not increase the regulatory burden of companies.

Fundamental rights

The new autonomous measures would respect the same basic principles as those enshrined in the Association Agreement between the EU and Ukraine. In particular, Article 2 of the Association Agreement with Ukraine provides that the respect for democratic principles, human rights and fundamental freedoms and respect for the principle of the rule of law, constitute essential elements of that Agreement.

3.BUDGETARY IMPLICATIONS

The European Union will see a loss of customs revenue corresponding to less than EUR 50 million annually with very limited impact on the EU’s own resources. The value of duties foregone on the importation of industrial products will count for approximately 20% of the total.

4.OTHER ELEMENTS

Implementation plans and monitoring, evaluation and reporting arrangements

On-line reporting on the utilisation of agricultural-related tariff-rate quotas is available via dedicated websites of the European Commission.

Explanatory documents (for directives)

Not applicable.

Detailed explanation of the specific provisions of the proposal

In view of the difficult economic situation and the economic reform efforts undertaken by Ukraine, and in order to support the development of closer economic relations with the European Union, the measure aims at increasing the trade flows concerning the import of certain agricultural products and to grant concessions in the form of autonomous trade measures in selected industrial products in line with the acceleration of the elimination of customs duties on trade between the European Union and Ukraine.

The autonomous trade measures would be granted in the form of zero-tariff quotas for certain agricultural products in addition to the preferential tariff-rate quotas set out in the Agreement, and the partial or full removal of import duties on several industrial products.

2016/0308 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the introduction of temporary autonomous trade measures for Ukraine supplementing the trade concessions available under the Association Agreement

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 207(2) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1)The Association Agreement between the European Union and the European Atomic Energy Community and their Member States of the one part and Ukraine, of the other part 1 constitutes the basis of the relationship between the Union and Ukraine. Title IV on trade and trade-related matters is provisionally applied since 1 January 2016 2 . In its preamble, the Parties to the Association Agreement have expressed their desire to strengthen and widen relations in an ambitious and innovative way;

(2)In view of the economic reform efforts undertaken by Ukraine, and in order to support the development of closer economic relations with the European Union, it is appropriate to increase the trade flows concerning the import of certain agricultural products and to grant concessions in the form of autonomous trade measures in selected industrial products in line with the acceleration of the elimination of customs duties on trade between the European Union and Ukraine.

(3)The autonomous trade measures would be granted in the form of zero-tariff quotas for products listed in Annexes I and II in addition to the preferential tariff-rate quotas set out in the Agreement, and the partial or full removal of import duties on industrial products listed in Annex III;

(4)In order to prevent any risk of fraud, the entitlement to benefit from the additional zero-tariff quotas should be conditional on the compliance by Ukraine with the relevant rules of origin of products concerned and the procedures related thereto as well as involvement in close administrative cooperation with the European Union as provided for by the Agreement;

(5)Ukraine is to abstain from introducing new duties or charges having equivalent effect or new quantitative restrictions or measures having equivalent effect or from increasing existing levels of duties or charges or from introducing any other restrictions. In the event of failure to comply with any of these conditions the European Commission should be empowered to suspend temporarily all or part of the autonomous trade measures;

(6)It is necessary to provide for the reintroduction of normal Common Customs Tariff duties for imports of any products which cause, or threaten to cause, serious difficulties to the European Union producers of like or directly competing products, subject to an investigation by the European Commission;

(7)In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission enabling it to temporarily suspend the preferential arrangements established by this Regulation and to introduce corrective measures in cases where the Union market is affected by this Regulation. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council 3 .

(8)The tariff-rate quotas shall be administered by the Commission in accordance with Articles 49 to 54 of Commission Implementing Regulation (EU) 2015/2447 4 , with the exception of those for specific agricultural products which shall be administered by the Commission in accordance with Article 184 of Regulation (EU) No 1308/2013 of the European Parliament and of the Council 5 .

(9)Article 2 of the Association Agreement provides that the respect for democratic principles, human rights and fundamental freedoms and respect for the principle of the rule of law, constitute essential elements of that Agreement. It is appropriate to introduce the possibility to temporarily suspend the preferences in case of failure to respect the fundamental principles of human rights, democracy and the rule of law by Ukraine.

(10)In view of the difficult economic situation in Ukraine, it is important for the Regulation to enter into force on the day following that of its publication in the Official Journal of the European Union,

HAVE ADOPTED THIS REGULATION:

Article 1

Preferential arrangements and access to tariff quotas

1.Products listed in Annexes I and II shall be admitted for import into the European Union within the limits of Union tariff-rate quotas as set out in those Annexes.

2.The tariff-rate quotas for products listed in Annex I shall be administered by the Commission in accordance with Articles 49 to 54 of Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015.

3.Tariff-rate quotas for specific agricultural products referred to in Annex II shall be administered by the Commission pursuant to the rules laid down in accordance with Article 184 of Regulation (EU) No 1308/2013.

4.Preferential customs duties on importation of certain industrial products originating goods from Ukraine will be applied according to Annex III.

Article 2

Conditions for entitlement to the preferential arrangements

Entitlement to benefit from the tariff-rate quotas introduced by Article 1 shall be subject to:

(a)compliance with the rules of origin of products and the procedures related thereto as provided for in the Association Agreement, and notably in Protocol I concerning the definition of the concept of "originating products" and methods of administrative co-operation, and in Protocol II on mutual administrative assistance in customs matters;

(b)abstention by Ukraine from introducing new duties or charges having equivalent effect and new quantitative restrictions or measures having equivalent effect for imports originating in the Union or from increasing existing levels of duties or charges or from introducing any other restrictions from the day of the entry into force of this Regulation;

(c)respect for democratic principles, human rights and fundamental freedoms and respect for the principle of the rule of law provided for in Article 2 of the Association Agreement.

Article 3

Temporary suspension

Where the Commission finds that there is sufficient evidence of failure to comply with the conditions set out in Article 2 it may suspend in whole or in part the preferential arrangements provided for in this Regulation, in accordance with the examination procedure referred to in Article 5(2).

Article 4

Safeguard clause

1.Where a product originating in Ukraine is imported on terms which cause, or threaten to cause, serious difficulties to a Community producer of like or directly competing products, Common Customs Tariff duties on such product may be reintroduced at any time by the Council acting by qualified majority on a proposal from the Commission.

2.At the request of a Member State or on the Commission’s initiative, the Commission shall take a formal decision to initiate an investigation within a reasonable period of time. Where the Commission decides to initiate an investigation, it shall publish a notice in the Official Journal of the European Union announcing the investigation. The notice shall provide a summary of the information received and state that any relevant information should be sent to the Commission. It shall specify the period, which shall not exceed four months from the date of publication of the notice, within which interested parties may make their views known in writing.

3.The Commission shall seek all information it deems necessary and may verify the information received with Ukraine and any other relevant source. It may be assisted by officials of the Member States on whose territory verification might be sought, if that Member State so requests.

4.In examining whether there are serious difficulties, the Commission shall take account, inter alia, of the following factors concerning Community producers where the information is available:

market share,

production,

stocks,

production capacity,

capacity utilisation,

employment,

imports,

prices.

5.The investigation shall be completed within six months after the publication of the notice referred to in paragraph 2. The Commission may, in the case of exceptional circumstances, extend this period in accordance with the procedure referred to in Article 5.

6.The Commission shall take a decision within three months, in accordance with the procedure referred to in Article 5. Such decision shall enter into force within one month as from its publication.

7.Where exceptional circumstances requiring immediate action make an investigation impossible, the Commission may, after informing the Committee, take any preventive measure which is strictly necessary.

Article 5

Committee procedure

1.For the implementation of Article 1(2) and Article 4 of this Regulation, the Commission shall be assisted by the Customs Code Committee established by Article 248a of Regulation (EEC) No 2913/92. The Committee shall be a committee within the meaning of Regulation (EU) No 182/2011.

2.Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.

Article 6

Entry into force and application

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

It shall apply for three years.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament    For the Council

The President    The President

LEGISLATIVE FINANCIAL STATEMENT FOR PROPOSALS HAVING A BUDGETARY IMPACT EXCLUSIVELY LIMITED TO THE REVENUE SIDE

1.NAME OF THE PROPOSAL:

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the introduction of temporary autonomous trade measures for Ukraine supplementing the trade concessions available under the Association Agreement

2.BUDGET LINES

Chapter and Article: Chapter 12, Article 120 (Custom duties)

Amount budgeted for the year 2016: 18.465,30 EUR million

3.FINANCIAL IMPACT

Proposal has no financial implications

Proposal has no financial impact on expenditure but has a financial impact on revenue – the effect is as follows:

(EUR million to one decimal place)

Revenue line 6

2016

2017

Article 120

0

35,3

Situation following action

Revenue line

2016

2017

2018

2019

2020

Article 120

18.465,30

18430

18430

18430

4.ANTI-FRAUD MEASURES

The EU's customs legislation is designed to ensure the correct application of all EU customs measures including the tariff preferences laid down in this Regulation, which also provides for the application of the necessary provisions of the Association Agreement between EU and Ukraine and the application of its Protocol I concerning the definition of the concept of "originating products" and methods of administrative co-operation and its respective Annexes, and the possibility, after consultations, of temporary withdrawal of tariff preferences in the event of frauds and irregularities involving preferential treatment.

5.OTHER REMARKS

This estimate is based on internal calculations. 

(1) OJ L 161, 29.5.2014, p. 3
(2) Council Decision 2014/668/EU of 23 June 2014 (OJ L 278, 20.9.2014, p. 1).
(3) Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).
(4) Commission Implementing Regulation (EU) 2015/2447 of 24 November 2015 laying down detailed rules for implementing certain provisions of Regulation (EU) No 952/2013 of the European Parliament and of the Council laying down the Union Customs Code (OJ L 343 29.12.2015, p. 558).
(5) Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L 347, 20.12.2013, p. 671) 
(6) In the case of traditional own resources (agricultural duties, sugar levies, customs duties), the amounts indicated must be net amounts, i.e. gross amounts after deduction of 25 % for collection costs.
Top

Brussels, 29.9.2016

COM(2016) 631 final

ANNEXES

to the

Proposal for a Regulation of the European Parliament and the Council

on the introduction of temporary autonomous trade measures for Ukraine supplementing the trade concessions available under the Association Agreement


ANNEXES

ANNEX I

Notwithstanding the rules for the interpretation of the Combined Nomenclature, the wording of the description of the products is to be considered as having no more than an indicative value, the scope of the preferential scheme being determined, within the context of this Annex, by CN codes as they exist at the time of adoption of this Regulation.

Order No

CN code

Description of goods

Quota period

From entry into force of this Regulation for 36 months

Annual quota volume

(in tonnes net weight unless otherwise specified)

09.6750

0409



Natural honey


3 000

09.6751

Ex 1103 19 20

1103 19 90




1103 20 90



1104 19 10

1104 19 50

1104 19 61

1104 19 69


ex 1104 29




1104 30


Barley groats

Groats and meals of cereals (excl. wheat, rye, oats, maize, rice and barley)


Cereal pellets (excl. wheat, rye, oats, maize, rice and barley)


Rolled or flaked wheat grains

Rolled or flaked maize grains

Rolled barley grains

Flaked barley grains


Worked grains (for example, hulled, pearled, sliced or kibbled), other than of oats, of rye or of maize


Germ of cereals, whole, rolled, flaked or ground

7 800

09.6752

2002

Tomatoes prepared or preserved otherwise than by vinegar or acetic acid

5 000

09.6753

2009 61 90

2009 69 11

2009 69 71 2009 69 79 2009 69 90

Grape juice (including grape must), of a Brix value not exceeding 30, of a value not exceeding 18 EUR per 100 kg net weight

Grape juice (including grape must), of a Brix value exceeding 67, of a value not exceeding 22 EUR per 100 kg net weight

Grape juice (including grape must), of a Brix value exceeding 30 but not exceeding 67, of a value not exceeding 18 EUR per 100 kg net weight

500

09.6754

1004

Oats

4 000

ANNEX II

Tariff rate quotas for specific agricultural products referred to in Article 1(3)

Notwithstanding the rules for the interpretation of the Combined Nomenclature, the wording of the description of the products is to be considered as having no more than an indicative value, the scope of the preferential scheme being determined, within the context of this Annex, by CN codes as they exist at the time of adoption of this Regulation.

Product

Tariff classification

Quantity

Common wheat, spelt and meslin, flour, groats, meal and pellets

1001 99 00

1101 00 15, 1101 00 90

1102 90 90

1103 11 90 1103 20 60

100 000 tons/year

Maize, other than seed, flour, groats, meal, pellets and grains

1005 90 00

1102 20

1103 13

1103 20 40

1104 23

650 000 tons/year

Barley, other than seed, flour and pellets

1003 90 00

1102 90 10

ex 1103 20 25

350 000 tons/year

ANNEX III

Preferential tariffs applied for specific products referred to in Article 1(4)

Notwithstanding the rules for the interpretation of the Combined Nomenclature, the wording of the description of the products is to be considered as having no more than an indicative value, the scope of the preferential scheme being determined, within the context of this Annex, by CN codes as they exist at the time of adoption of this Regulation.

CN 2016

DESCRIPTION

Applied duties

 

CHAPTER 31 - FERTILISERS

3102 10 10

Urea, whether or not in aqueous solution, containing more than 45% by weight of nitrogen on the dry anhydrous product (excl. that in pellet or similar forms, or in packages with a gross weight not exceeding 10 kg)

3%

3102 21 00

Ammonium sulphate (excl. that in pellet or similar forms, or in packages with a gross weight not exceeding 10 kg)

0%

3102 40 10

Mixtures of ammonium nitrate with calcium carbonate or other inorganic non-fertilising substances, with a nitrogen content not exceeding 28 % by weight (excl. those in pellet or similar forms, or in packages with a gross weight not exceeding 10 kg)

0%

3102 50 00

Sodium nitrate (excl. that in pellet or similar forms, or in packages with a gross weight not exceeding 10 kg)

0%

3105 20 10

Mineral or chemical fertilisers containing nitrogen, phosphorus and potassium, with a nitrogen content exceeding 10 % by weight on the dry anhydrous product (excl. those in tablets or similar forms, or in packages with a gross weight not exceeding 10 kg)

0%

3105 51 00

Mineral or chemical fertilisers containing nitrates and phosphates

0%

CHAPTER 32 - TANNING OR DYEING EXTRACTS; TANNINS AND THEIR DERIVATIVES; DYES, PIGMENTS AND OTHER COLOURING MATTER; PAINTS AND VARNISHES; PUTTY AND OTHER MASTICS; INKS

320611 00

Pigments and preparations based on titanium dioxide , containing 80% or more by weight of titanium dioxide calculated on the dry matter

0%

CHAPTER 64 - FOOTWEAR, GAITERS AND THE LIKE; PARTS OF SUCH ARTICLES

6402 91 90

Footwear covering the ankle, with outer soles and uppers of rubber or plastics

0%

6402 99 98

Footwear with outer soles of rubber or plastics and uppers of plastics, with in-soles of a length of 24 cm or more, for women

0%

6403 99 96

Men's footwear with outer soles of rubber, plastics or composition leather and uppers of leather (not covering the ankle), with in-soles of a length of 24 cm or more (excl. 6403.11-00 to 6403.40.00, 6403.99.11, 6403.99.36, 6403.99.50)

0%

6403 99 98

Footwear with outer soles of rubber, plastics or composition leather and uppers of leather, with in-soles of a length of 24 cm or more, for women

0%

CHAPTER 74 - COPPER AND ARTICLES THEREOF

7407 21 10

Bars and rods, of copper-zinc base alloys "brass"

0%

7408 11 00

Wire of refined copper, with a maximum cross-sectional dimension of more than 6 mm

0%

CHAPTER 76 - ALUMINIUM AND ARTICLES THEREOF

7601 10 00

Aluminium, not alloyed, unwrought

0%

7601 20 20

Unwrought aluminium alloys in the form of slabs or billets

0%

7601 20 80

Unwrought aluminium alloys (other than slabs and billets)

0%

7604 21 00

Hollow profiles of aluminium alloys

0%

760429 90

Solid profiles, of aluminium alloys

0%

7616 99 90

Articles of aluminium, uncast

0%

CHAPTER 85 - ELECTRICAL MACHINERY AND EQUIPMENT AND PARTS THEREOF; SOUND RECORDERS AND REPRODUCERS, TELEVISION IMAGE AND SOUND RECORDERS AND REPRODUCERS, AND PARTS AND ACCESSORIES OF SUCH ARTICLES

8525 80 99

Video camera recorders other than those only able to record sound and images taken by the television camera

0%

8528 71 19

Video tuners (excl. electronic assemblies for incorporation into automatic data-processing machines and apparatus with a microprocessor-based device incorporating a modem for gaining access to the Internet and having a function of interactive information exchange capable of receiving television signals "set-top boxes with communication function")

0%

8528 71 99

Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus, not designed to incorporate a video display or screen (excl. video tuners, set-top boxes with a communication function)

0%

8528 72 40

Reception apparatus for television, colour, with LCD screen

0%

Top