The Community:

The High Contracting Parties recall that the fundamental objectives of the European Economic Community comprise the constant improvement of living and working conditions of the peoples of the Member States and the harmonious development of their economies by reducing the variation between the different regions and the backwardness of the less-favoured regions.

They note the fact that the Government of the Portuguese Republic and the authorities of the autonomous regions of the Azores and Madeira are pursuing an economic and social development policy the object of which is to overcome the handicaps of these regions, which arise from their geographical situation, far away from the mainland of Europe, their physical geographical features, the serious deficiency of infrastructures and their economic backwardness.

They recognize that it is in their common interest that the final objectives set by this policy be attained and recall that specific provisions concerning the autonomous regions of the Azores and Madeira have been adopted in the instruments of accession.

The High Contracting Parties agree to recommend to this end that the Community institutions devote special attention to the realization of the above objectives.

The enlargement of the Community could give rise to certain difficulties for the social situation in one or more Member States as regards the application of the provisions relating to the free movement of workers.

The Member States declare that they reserve the right, should difficulties of that nature arise, to bring the matter before the institutions of the Community in order to obtain a solution to this problem in accordance with the Treaties establishing the European Communities and the provisions adopted in application thereof.

Discussions on the adjustment of this ‘acquis’ to the new situation of the Community as enlarged will be embarked upon as quickly as possible after accession.

These discussions will take place on the basis of Commission proposals which will also take account of guidelines accepted by the Council in October 1983 with regard to olive oil and the development of the market in oils and fats. Should the existence of surpluses for olive oil or a genuine risk of the build-up of surpluses be ascertained, guarantee thresholds will be applied under the conditions indicated in the conclusions reached by the Council at its meeting in March 1984, within the framework of the guidelines to be followed for the organization of the market in products which are witnessing or are likely to witness surplus production or a rapid increase in expenditure. These measures will take account of the repercussions of trade concessions in favour of third countries.

In their mutual trade in agricultural products, each of the new Member States shall apply in principle with respect to the other the provisions and transitional mechanisms provided for in the Act of Accession under the arrangements applicable to their respective trade with the Community as at present constituted. The introduction of these arrangements shall be made whilst taking into account the existence of a classic transition and a transition by stages in the context of the transitional measures laid down for Portugal, on the one hand, and the existence of a verification of convergence phase in the fruit and vegetable sector under the transitional measures provided for Spain, on the other.

However, with regard to the following sectors:

the arrangements applicable to trade between the new Member States will be adopted in accordance with the guidelines agreed within the Conference.

To the extent that the deterioration of the Community market or that of one of its regions is also due to imports from third countries, measures shall only be taken with respect to those imports within the framework and under the conditions of mechanisms already provided for by the common organizations of the market and in compliance with the provisions referring to the international commitments of the Community.

For the purposes of applying Article 123 (2) (a) and Article 338 (2) (a) of the Act of Accession, the adjustment of the regulatory amount intended to take account of the situation of market prices shall be carried out by taking into consideration the specific prices of certain types of product on the basis of their quality and their vatting, bottling and labelling, which should lead to a reduction of the regulatory amount on the basis of the highest price for these types of wine.

Common wheat shall not be subject to STM when it has been subjected to a denaturing method, determined on a Community basis, guaranteeing that it will not be used for bread-making.

In the event of difficulties arising concerning the maintenance of traditional trade flows for Canary agricultural products, the Community is prepared to examine, within the context of the adjustment measures referred to in the second subparagraph of Article 25 (4) of the Act of Accession, the possibility of:

However, the Community recalls that deliveries under the tariff quotas will follow the rate of traditional trade flows, without thereby jeopardizing the possibility of exhausting the quotas.

Moreover the Community does not exclude developments in tariff quotas for fishery products of Canary origin related to the reported development of the local Canary fishing fleet.

For the tariff quotas referred to in Article 3 of Protocol 2, administration ‘by product’ may include groupings of products in relation to the general structure of production and trade of the products concerned with respect to the relevant destinations. These groupings should not lead to a substantial alteration in traditional trade flows between the Canary Islands and Ceuta and Melilla, and, on the one hand, that part of Spain which is included in the customs territory of the Community, and, on the other, the other Member States.

The rules of application which will be adopted by the Council in accordance with Article 9 (1) of Protocol 2 will comply with the details agreed upon during negotiations.

Where the institutions of the Community decide on the appropriate procedures to allow integration of the new Member States into the fisheries agreements entered into by the Community, they shall follow the relevant guidelines agreed during the negotiation conferences.

In negotiations of the protocols to be concluded with co-contracting third countries referred to in Articles 179, 183, 366 and 370, the Community shall take as its basis for negotiation the provisions which have been agreed in the matter during the Conferences between the European Communities and the new Member States.

Taking into account the current definition of the ECU and subject to any revision thereof which might appear necessary, in due course, on the basis of the experience acquired in the development of the role of the ECU, the Community and the new Member States note that all the Member States have the right for their currency to be included in the ECU, under a Community procedure.

The decisions to include the peseta and the escudo must take into account the necessity of ensuring a stable development of the functions and uses of the ECU; either of these decisions could be made at the request of the new Member State concerned, after consultation with the Monetary Committee, on the occasion of the first five-year review of the weighting of the currencies within the ECU.

The Government of the Federal Republic of Germany reserves the right to declare, when the accession of the Kingdom of Spain and the Portuguese Republic to the European Coal and Steel Community takes effect and upon depositing its instrument of ratification of the Treaty concerning the accession of those countries to the European Economic Community and to the European Atomic Energy Community, that the Decision of the Council of 11 June 1985 concerning accession to the European Coal and Steel Community and the Treaty referred to above shall equally apply to Land Berlin.

As to the Federal Republic of Germany, the term ‘nationals’, wherever used in the Act of Accession and in the Annexes thereto, is to be understood to refer to ‘Germans as defined in the Basic Law of the Federal Republic of Germany’.

Spanish wines which are considered to be quality wines produced in specified regions (psr) within the meaning of Community rules shall be those produced and actually protected and marketed under the designation ‘denominación de origen’.

The action programme to be drawn up in the fruit and vegetable sector, pursuant to Article 134 of the Act of Accession, for the purposes of achieving general objectives during the verification of convergence phase shall be drawn up in close cooperation with the Commission and adopted not later than one month before the date of accession; this action programme shall be published in the ‘C’ series of the Official Journal of the European Communities.

If, pursuant to Article 80 of the Act of Accession, the Kingdom of Spain is authorized to maintain a national aid on a transitional and degressive basis, the specific procedures designed to ensure equality of access on the Spanish market will only be defined if the grant of that national aid entails an actual modification on the Spanish market of the conditions of competition between domestic products and products imported from the other Member States.

I.   STRUCTURAL MEASURES IN THE WINE SECTOR

The following guidelines shall be adopted with regard to the application to Spain of structural measures in the wine sector:

II.   PROVISIONS ENABLING THE ORIGIN TO BE DETERMINED AND THE COMMERCIAL MOVEMENTS OF SPANISH WINES TO BE FOLLOWED

For the application of Article 125 of the Act of Accession on provisions enabling the origin of Spanish red table wines to be determined and their commercial movements to be followed in intra-Community trade, the control will be carried out by means of the accompanying document established by Regulation (EEC) No 1153/75.

III

The different specific procedures, to be defined on the basis of the guidelines adumbrated above, will be determined during the interim period.

An arrangement governing trade relations between the Community and Andorra will be finalized within a period of two years of the date of entry into force of the Act of Accession and will be intended to replace the national arrangements at present in force. These national arrangements will continue to be applied until the abovementioned arrangement comes into force.

The Portuguese authorities may make access to the Portuguese oil market by undertakings from Member States subject to those undertakings satisfying objective and non-discriminatory criteria aimed at upholding the legitimate interest of the Portuguese State with regard to the national availability of supply of petroleum products. These criteria, which must be limited to what is necessary for the purposes of the abovementioned aim, concern:

Pursuant to Article 2 (3) of Council Directive 77/780/EEC of 12 December 1977, the Council shall take a decision, at the latest at the end of a period of seven years following accession, on the inclusion in the list referred to in paragraph 2 of the said Article, of the following institutions in Portugal under the conditions laid down below:

The decision taken shall be subject to the condition that, before the expiry of a period of seven years from the date of accession, the rules of the institutions referred to in (a) and (b) above have been amended in such a way as to establish separate management between the operations listed above, which would be excluded from the application of Directive 77/780/EEC, and the other operations of the said institutions to which that Directive will have to apply.

The action programme to be drawn up for the products subject to transition by stages pursuant to Article 264 (2) (a) of the Act of Accession for the purposes of achieving specific objectives during the first stage of transition shall be drawn up in close cooperation with the Commission and adopted at the latest one month before the date of accession; this action programme shall be published in the ‘C’ series of the Official Journal of the European Communities.

Before the end of the second stage:

Within the context of measures connected with decisions on agricultural prices, the Council of the European Communities has adopted, on 23 May 1985, provisions making it possible to take appropriate measures with a view to equalizing the prices of raw cane sugar originating in the French overseas departments and of unrefined beet sugar intended for refining. These measures will enable Portuguese refineries to be supplied with the sugar in question under price conditions similar to those for preferential sugars.

Throughout the period of application of the temporary derogation enabling the Portuguese Republic to postpone the introduction of the common system of value added tax, the Portuguese Republic shall be treated as a third country for the purposes of applying the Directives referred to in point II ‘Taxation’ of Annex XXXVI.

Under the transitional provisions on the exercise of the right of freedom of movement, the present Member States shall, when they have recourse, in order to satisfy their labour requirements, to labour originating in third countries which does not form part of their regular labour market, grant Spanish and Portuguese nationals the same priority as that enjoyed by nationals of the other Member States.

With a view to ensuring that Portugal and the region of Spain which may be eligible for the increased intervention rate are treated according to the same principles as the regions concerned of the present Community as from accession, the Community shall, before accession, make a start on adapting the relevant provisions of the rules governing the European Social Fund pursuant to the procedure applicable for their adoption.

In order to ensure that Spain and Portugal participate in the benefits derived from the resources of the European Regional Development Fund as from accession, the Community will, before accession, adapt the provisions of Council Regulation (EEC) No 1787/84 of 19 June 1984 on the European Regional Development Fund, which fix the upper and lower limits of the range allocated to each Member State.

The Community is prepared to pay particular attention to the supply situation of Portuguese refineries in future reviews of the common organization of the market in that sector.

In addition, the Community is prepared to carry out, before the end of the transitional period, an overall examination of the supply situation of the refining industry in the Community and in particular of the Portuguese industry, on the basis of a report from the Commission accompanied if necessary by proposals permitting the Council to decide, if need be, on the measures to be taken.

The Community confirms Community support for monitoring and supervising waters falling under the sovereignty or within the jurisdiction of Portugal, may be envisaged.

The accession of the Portuguese Republic to the European Communities affords the prospect of modernizing its economy and increasing its growth potential.

To that end, a specific agricultural development programme previously defined in Article 263 and Protocol 24 shall apply immediately upon accession and shall be phased over a total of 10 years.

A similar effort is called for in the industrial field, in order to modernize the production sector and to adapt it to European and international economic realities. The Community is prepared, in the same spirit as for agriculture, to aid Portuguese undertakings, by letting them benefit from its technical support and its credit instruments — both NCI and private operations — and by increased contributions from the European Investment Bank.

Within the framework of the Community loan mechanism designed to support balances of payments of Member States (in accordance with the provisions of Council Regulation (EEC) No 682/81 of 16 March 1981 as amended by Council Regulation (EEC) No 1131/85 of 30 April 1985) a sum of 1 000 million ECU will be granted to the Portuguese Republic in the form of a loan over the years 1986 to 1991. For the annual division of this total amount, a special effort will be made in 1986 and in 1991.

The Community takes note that application of the regulatory amount arrangements should not affect traditional trade patterns.

The Kingdom of Spain considers that any reference to the zone covered by the Fishery Committee for the Eastern Central Atlantic (CECAF) must extend without prejudice to the rights of the Kingdom of Spain to the effects of demarcation of Spanish waters.

In order to avoid sudden disturbances in its imports originating in Latin America, Spain has highlighted in the negotiations the problems which arise from the application of the ‘acquis communautaire’ to certain products. Partial and temporary solutions have been adopted for tobacco, cocoa and coffee.

Spain, in accordance with the principles and criteria set out in the Joint declaration adopted by the Conference on Latin America, proposes finding permanent solutions in the context of the generalized system preferences, when next revised, or of other mechanisms existing within the Community.

The Kingdom of Spain, not having acceded to the Treaty on the non-proliferation of nuclear weapons, undertakes to seek actively and as rapidly as possible in close cooperation with the Commission and the Council, the most appropriate solution calculated, whilst taking into account the Community's international commitments, to observe fully the obligations flowing from the Treaty establishing the European Atomic Energy Community, in particular with respect to nuclear supplies and to the movement of nuclear materials within the Community.

In adopting the provisions contained in Article 358, concerning the compensatory indemnity arrangements for sardine producers of the Community as at present constituted, the Portuguese delegation keeps open for itself the option of asking the Council to adopt the appropriate measures which might prove necessary to remedy any disturbances in the conditions of competition injurious to the sardine canning industry in Portugal.

The delegation takes the view, furthermore, that the measures likely to be taken following the period of the move towards the alignment of prices are not likely to be of a discriminatory nature.

The Portuguese Republic considers that any reference to the zone covered by the Fishery Committee for the Eastern Central Atlantic (CECAF) must extend without prejudice to the rights of the Portuguese Republic to the effects of demarcation of Portuguese waters.

In order that the movement of the real rate of the Portuguese escudo, particularly in relation to the ECU and to the currencies of the other Member States, may be followed on foreign exchange markets, the Portuguese Republic will, before accession to the Community, take the necessary measures to ensure that the foreign exchange market in Lisbon operates in a comparable fashion to that in the present Member States of the Community.

I

II

The Kingdom of Spain and the Portuguese Republic shall take the necessary measures to ensure that their accession to the agreements or conventions referred to in Articles 3 (2) and 4 (2) of the Act concerning the conditions of accession and the adjustments to the Treaties coincides so far as possible, and under the conditions laid down in that Act, with the entry into force of the Treaty of Accession.

In so far as the agreements or conventions between the Member States, referred to in the second sentence of Article 3 (1) and in Article 3 (2), exist only in draft, have not yet been signed, and probably can no longer be signed in the period before accession, the acceding States will be invited to be associated, after the signature of the Treaty of Accession and in accordance with appropriate procedures, with the preparation of those drafts in a positive spirit and in such manner as to facilitate their conclusion.

III

With regard to the negotiation of the Protocols of transition and of adjustment with the co-contracting countries referred to in Articles 179 and 366 of the Act concerning the conditions of accession, the representatives of the acceding States shall be associated with the work as observers, side by side with the representatives of the present Member States.

Certain non-preferential agreements concluded by the Community, which remain in force after 1 January 1986, may be the subject of adaptations or adjustments in order to take account of the enlargement of the Community. These adaptations or adjustments will be negotiated by the Community in association with the representatives of the acceding States in accordance with the procedure referred to in the preceding paragraph.

IV

The consultations between the acceding States and the Commission provided for in Articles 61 (2) and 223 (2) of the Act concerning the conditions of accession and the adjustments to the Treaties shall take place before accession.

V

The acceding States undertake that the granting of the licences referred to in Article 2 of Protocols 13 and 22 on the exchange of information in the field of nuclear energy shall not be deliberately accelerated before accession with a view to reducing the scope of the commitments contained in these Protocols.

VI

The institutions of the Community shall, in due course, draw up the texts referred to in Article 397 of the Act concerning the conditions of accession and the adjustments to the Treaties.