Association of the OCTs with the European Community

This decision draws up a framework for the association of the overseas countries and territories (OCTs) with the European Community (EC) in accordance with Part IV of the EC Treaty in order to promote their economic and social development and to establish close economic relations between them and the EC as a whole.

ACT

Council Decision 2001/822/EC of 27 November 2001 on the association of the overseas countries and territories with the European Community ("Overseas Association Decision") [See amending acts].

SUMMARY

The OCT association arrangements are designed to promote the economic and social development of the OCTs more effectively and to develop economic relations between the OCTs and the EC as a whole.

Cooperation focuses in particular on three issues:

• the reduction, prevention and eventual eradication of poverty;
• sustainable development;
• the gradual integration of the OCTs into the regional and world economies.

These association arrangements are also based on the principles of freedom, democracy, respect for human rights and fundamental freedoms and the rule of law, which are common to the Member States and to the associated OCTs.

AREAS OF COOPERATION

Economic and trade cooperation: trade arrangements

The OCTs benefit from a very advantageous trade system. Products originating in the OCTs and imported into the EC are not subject to import duties or quantitative restrictions. These arrangements are non-reciprocal, in other words, under certain conditions, products originating in the EC may be subject to import duties or charges established by the OCTs. Nonetheless, the system applied to the EC may not be any less favourable than that applied to Non-EU Member Countries in accordance with the most-favoured-nation principle by the OCTs unless another OCT or developing country is involved. Similarly, the OCTs may not discriminate between members of the European Union (EU).

The association arrangements lay down favourable rules of origin and specific provisions permitting cumulation of origin with materials originating in the EC or in the African, Caribbean and Pacific countries (ACP).

There is also a procedure for the trans-shipment of goods which, under certain conditions, enables products not originating in the OCTs but imported there from Non-EU Member Countries and on which import duties or charges have been paid in the OCTs to be imported into the EC in line with the beneficial arrangements for OCTs. This procedure does not apply to agricultural products or goods resulting from the processing of agricultural products, with one exception.

Development finance corporation

Cooperation in this area is designed in particular to contribute to the development of the OCTs by supporting policies and strategies in productive sectors and in areas such as trade development, trade-related areas, human, social and environmental development, and cultural and social cooperation.

Regional cooperation and integration

Cooperation in this area involves operations between OCTs and between OCTs and other Non-EU Member Countries, such as ACP countries, and cooperation with the outermost regions. It is aimed at accelerating economic cooperation and development, promoting the free movement of persons, goods, services, labour and technology, liberalising trade and payments, and implementing sectoral reform policies at regional level. In addition, closer cooperation and greater integration should encourage the least-developed OCTs to participate in and benefit from regional markets.

IMPLEMENTATION

The association is based on the principle of a trilateral partnership between the Commission, the Member State to which the OCT is linked and the OCT itself. Two main instruments are responsible for ensuring effective cooperation:

• an OCT-EC forum for dialogue ("OCT Forum"), which meets annually and is made up of the EC, all the OCTs and all the Member States to which the OCTs are linked;
• an individualised partnership between the Commission, the Member State with which the OCT is linked and each of the OCTs represented by its authorities.

Like the ACP countries, the OCTs benefit from the European Development Fund (EDF), which is the main instrument for cooperation in financing the development of the OCTs and for regional cooperation involving them. A development and cooperation strategy is adopted by each OCT in the form of a Single Programming Document (SPD). The OCTs are responsible, first and foremost, for determining and implementing cooperation measures and the SPD is thus drawn up principally by the authorities of the OCTs. It is adopted jointly by the authorities of the OCTs and the Commission. Monitoring and evaluation are the responsibility of all the partners. Civil society is also an important actor in the cooperation field and the non-governmental actors identified in each OCT should be involved in the drawing up of the cooperation programmes.

FINANCIAL RESOURCES

Financial resources of the EDF

A total amount of EUR 175 million, of which EUR 20 million is set aside for the Investment Facility managed by the European Investment Bank (EIB), was granted to the OCTs under the 9th EDF for the period 2000-2007. For the period 2008-2013, an amount of EUR 286 million is granted under the 10th EDF, of which EUR 30 million for financing the Investment Facility.

EIB Investment Facility and loans

The EDF manages the Investment Facility and loans from its own resources. The Investment Facility is designed to promote commercially viable businesses primarily in the private sector or those in the public sector that support development in the private sector.

Financial resources from the general EU budget

The OCTs benefit from the thematic programmes financed by the Development Cooperation Financing Instrument (DCFI) and from regeneration and reconstruction measures financed by the Stability Instrument and from humanitarian aid financed by the Humanitarian Aid Instrument.

In addition, all the horizontal Community programmes and, in particular, those in the field of education, training and youth, research, enterprise and the audiovisual sector are, in principle, open to the OCTs, subject to the rules and objectives of those programmes and to the arrangements applicable to the Member State to which a OCT is linked.

Last updated: 31.08.2011