PREFERENTIAL RULES OF ORIGIN A GLOBAL EU TRADE POLICY

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• PREFERENTIAL RULES OF ORIGIN A GLOBAL EU TRADE
  POLICY
• BASIC PRINCIPLES
• PREFERENTIAL TRADE ARRANGEMENTS ARE AIMED AT
• INCREASING RECIPROCAL TRADE IN GOODS AND ACCESS
• TO THE COMMUNITY MARKET FOR PRODUCTS FROM
• DEVELOPING COUNTRIES BY ELIMINATING OR REDUCING
• CUSTOMS DUTIES
• THESE TARIFF PREFERENCES ONLY MAKE SENSE IF THEY
• APPLY TO PRODUCTS ACTUALLY AND REALLY OBTAINED IN
  
• THE COUNTRY THAT GRANTED THE PREFERENCE
• ORIGINATING STATUS OF GOODS

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• REQUIRED ACTION IN THREE AREAS
• ACTION TO DETERMINE THE ORIGIN OF THE PRODUCT
• ACTION TO CHECK IF RULES OF ORIGIN ARE FAIRLY
  APPLIED
• PROCEDURE FOR BALANCE OF RESPONSIBILITIES
  BETWEEN TRADE GAINING FROM PREFERENTIAL
  ARRANGEMENTS AND AUTHORITIES

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• WHAT IS THE IMPACT OF PREFERENTIAL ARRANGEMENTS?
• EU USES PREFERENTIAL ARRANGEMENTS TO GIVE
  PREFERENTIAL TREATMENT TO IMPORTS FROM GIVEN
  COUNTRIES AND FOR GIVEN GOODS
• EITHER BY REGIONAL ECONOMIC INTEGRATION TO CREATE
  FREE TRADE AREAS OR CUSTOMS UNION OR UNILATERAL
  PRIMARILY WITH A VIEW TO THE DEVELOPMENT OF THE
  BENEFICIARY COUNTRIES
• HOW EXTENSIVE?
• _EU INVOLVED IN 4O PREFERENTIAL ARRANGEMENTS WITH
  COUNTRIES OR GROUPS OF COUNTRIES
• _ABOUT TWO THIRD OF COMMUNITY ANNUAL IMPORT
• _WORTH SOME 1000 BILLION EURO
• _PREFERENTIAL ARRANGEMENTS ACCOUNT FOR 45 OF
  THESE COUNTRIES
• _21 OF COMMUNITY TOTAL ANNUAL IMPORTS

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• IMPORTANT PROPORTION BUT RATHER LOW PROPORTION
• BECAUSE NO ARRANGEMENTS WITH MAJOR TRADE
  PARTNERS SUCH AS US JAPAN
• BECAUSE MANY PRODUCTS ARE NOT SUBJECT TO CUSTOMS
• DUTY
• BECAUSE NOT ALL THE PRODUCTS ARE ELIGIBLE FOR
• PREFERENCE
• BECAUSE SOME ELIGIBLE PRODUCTS DO NOT SATISFY TO
  CONDITIONS OF ORIGIN
• BECAUSE TRADERS SOMETIMES ABANDON THE IDEA OF
  CLAIMING PREFERENCE HAVING WEIGHED UP THE PROFIT
  TO BE GAINED AGAINST THE COST

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• WHAT ARE PREFERENTIAL RULES?
• BASIC ORIGINATING STATUSPREFERENCE PASSPORT
• _RAW MATERIALS
• _WORKING OR PROCESSING OF NON ORIGINATING
  CRITERIA
• GENERATING CHANGE IN TARIFF HEADINGPERCENTAGE OF
  
• VALUE ADDED SPECIFIC PROCESS OR COMBINATION OF
• CRITERIA
• HOW TO CHECK ?
• CERTIFICATION BY AUTHORITIES OF EXPORTING
  COUNTRIES EITHER DIRECTLY VIA CERTIFICATES OF
  AUTHORITIES
• OR INDERECTLYVIA AUTHORISATION ENABLING
  EXPORTERS
• TO DEMONSTRATE THE ORIGIN

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• SIMPLE PRINCIPLE DIFFICULT MANAGEMENT
• MANAGEMENT OF THE SYSTEM AND MONITORING OF RIGHT
  APPLICATION OF THE RULES NOT ALWAYS EASY
• MONITORING OF THE REGIME AND APPROPRIATE
  APPLICATION OF THE RULES BY CONTRACTING PARTIES
  ESPECIALLY SOME COUNTRIES WITHOUT WELL ORGANISED
• ADMINISTRATIONS IS NOT AN EASY TASK FOR THE
  COMMUNITY AND FOR THE COMMISSION IN PARTICULAR.
• INDEED IMPLEMENTATION OF PREFERENTIAL TARIFFS
  REQUIREMENT OF PERMANENT EXCHANGE OF INFORMATION
  INDISPENSABLE FOR MANAGEMENT OF RULES OF ORIGIN
• THOUGH THE COUNTRIES WHERE PROBLEMS ARE
  ORIGINATING ARE KNOWN THE FEASIBILITY OF CONTROL
  ON THE SPOT IN COUNTRY OF ORIGIN IS DIFFICULT
• HUGE FINANCIAL LOSSES FOR THE COMMUNITY IN CASE
  OF FRAUDS AND IRREGULARITIES..WRONG OR
  FALSIFIED..OR REAL FALSIFIED CERTIFICATES OF
  ORIGIN
• IMPORTER PROVING GOOD FAITH CAN BE EXEMPTED FROM
  PAYMENT OF DUTIES RECENT EVOLUTION

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• DIFFICULT MANAGEMENT
• FOR SOME PRODUCTS IT IS CLEAR THAT THEY
  ORIGINATE
• IN A COUNTRY BECAUSE OBTAINED FROM LOCAL RAW
• MATERIALS
• FOR SOME PRODUCTS IT IS LESS CLEAR BECAUSE THE
• GOODS ARE THE PRODUCT OF WORKING OR PROCESSING OF
  NON ORIGINATING IMPORTED GOODS IN A
  COUNTRYTURKISH TELEVISIONS
• IF IN THE LATTER CASE A PRODUCT IS TO OBTAIN
  ORIGINATING STATUS THE PROCESSING MUST BE
• SUBSTANTIAL ENOUGH TO ESTABLISH A GENUINE LINK
  BETWEEN THE PRODUCT AND THE COUNTRY

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• DIFFICULT MANAGEMENT
• CRITERIA HAVE BEEN ESTABLISHED FOR EACH CATEGORY
• OF PRODUCTS TARIFF HEADING..PERCENTAGE OF VALLUE
• ADDEDSPECIFIC PROCESS OR COMBINATION OF CRITERIA
• IN ORDER TO DETERMINE WHETHER OPERATIONS CARRIED
• OUT IN A GIVEN COUNTRY ON NON ORIGINATING
  MATERIALS
• USED TO OBTAIN THE PRODUCTS ARE SUFFICIENT TO
• CONSIDER THEM AS ORIGINATING FROM THAT COUNTRY
• SOME MINOR OPERATIONS MINIMAL PROCESSES NEVER
• CONFER ORIGINATING STATUS OF THE GOODS

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• NEW EXAMINATIONNEW 2004 CONSULTATIONGREEN PAPER
• OF THE EU
  COMMISSION
• CHECKING ORIGIN REQUIRE ARRANGEMENTS FOR CLOSE
  ADMINISTRATIVE COOPERATION BETWEEN EXPORTING
  COUNTRIES AND IMPORTING COUNTRIES WHO GRANTED
  PREFERENCE TREATMENT
• THE OBVIOUSLY SIMPLE MECANISM BETWEEN COUNTRIES
  OF DEPARTURE AND COUNTRIES OF ENTRY IS VERY
  SIMPLY INDICATING WHERE THE SHORTCOMINGS,IRREGULAR
  ITIES AND EVEN FRAUDS CAN BE DETECTED AND SLIP IN
  THE PREFERENTIAL ARRANGEMENTS WHATEVER THEIR
  STRUCTURE
• IS
• THE EU COMMISSION AWARE OF THE PROBLEMS LAUNCHED
  AT THE END OF 2OO3 A WIDE RANGE CONSULTATION AND
• IS CURRENTLY EXAMINING THE VIEWS OF AUTHORITIES
  AND TRADE THIS ONGOING PROCESS WILL GENERATE NEW
  RECOMMENDATIONS

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• SHORTCOMINGS AND FAILURES IN COOPERATION
• UP TO DATE RECOMMENDATIONS ARE NOT EVIDENT
  BECAUSE THE CURRENT SYSTEM ADMINISTRATING AND
  SUPERVISING THE RULES OF ORIGIN IS BASED
  ESSENTIALLY ON ADMINISTRATIVE COOPERATION BETWEEN
  AUTHORITIES OF EXPORTING AND IMPORTING COUNTRIES
• EXPORTING COUNTRIES CERTIFY AND VERIFY THE
  ORIGIN OF THE PRODUCTS
• MANAGEMENT IS A MATTER OF ADMINISTRATIVE
  COOPERATION AND IRREGULARITIES REPRESENT AN
  HINDRANCE FOR FAIR TRADE AND THE PROTECTION OF
  ECONOMIC AND FINANCIAL INTERESTS OF THE COMMUNITY
• ADMINISTRATIVE COOPERATION MEAN THAT IMPORTING
  COUNTRIES SHOULD RELY ON EXPORTING COUNTRIES IN
  THE EVENT OF PROBLEMS OR SUSPECTED PROBLEMS

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• SHORTCOMINGS
• IF THIS COOPERATION IS FAILING OR NOT WELL
  IMPLEMENTED IMPORTING COUNTRIES ARE IN A
  POWERLESS
• POSITION TO PROTECT ITS LEGITIMATE INTERESTS
• THE BASIS IS THE GOODWILL AND THE GOOD FAITH OF
  EXPORTING COUNTRIES
• OFTEN EXPORTING COUNTRIES ARE RELUCTANT TO
  ACTION TO CONDUCT THOROUGH CHECKS IN CONNECTION
  WITH AN EXPORT OPERATION..EVEN WHEN REQUIRED BY
  IMPORTING COUNTRIES ON REASONABLE GROUNDS

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• EU COMMISSION 2004 GREEN PAPERA NEW STRATEGY?
• A NEW DISTRIBUTION OF RESPONSIBILITES WITH REGARD
  TO ORIGIN IS REQUIRED BETWEEN AUTHORITIES OF
  COUNTRIES LINKED BY PREFERENTIAL ARRANGEMENTS AS
  WELL BETWEEN AUTHORITIES AND TRADE
• THE 2004 GREEN PAPER IS AN APPROPRIATE REFLECTION
  AT THE STAGE OF CONSULTATION THE JUDGMENT OF THE
  COURT OF FIRST INSTANCE IN LUXEMBURG IN THE
  TURKISH TELEVISION CASE WAS ONE
• IMPETUS

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• CONCLUSION
• ANYWAY AT THE STAGE OF THE GREEN PAPER
  CONSULTATION TRADE SHOULD INSIST ON SOME BASIC
  REALISTIC PROPOSALS AND SOLUTIONS TO MINIMIZE
  IRREGULARITIES
• AND FRAUDS
• COMPULSORY VERIFICATION OF STAMPS IN COUNTRY OF
  ORIGIN AND COUNTRY OF ENTRY
• STRICTLY MONITORING OF ISSUE OF CERTIFICATES
• PRECISE SANCTIONS FOR FRAUD AGREED BY
  CONTRACTING PARTIES
• INCREASED SELECTION OF LIABILITY OF PARTNER
  COUNTRIES
• ABOLITION OF PREFERENTIAL AGREEMENTS WITH HIGH
  RISK COUNTRIES
• EXTENSION OF THE PRINCIPLE OF GOOD FAITH FOR
  OPERATORS WHO WERE NEVER IN A POSITION TO DETECT
  INITIAL STAGE IRREGULARITY OR FRAUD
• A GOOD FAITH PRINCIPLE MEANS NO REPONSIBILITY
  FOR TRADE AS A RESULT OF TURKISH TELEVISION
  JUDGMENT

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