RESTRICTEDWORLD TRADE
ORGANIZATIONWT/REG64/4
14 September 2000
(00-3603)
Committee on Regional Trade Agreements Original:  English
FREE TRADE AGREEMENT BETWEEN ESTONIA AND THE
FAROE ISLANDS (GOVERNMENT OF DENMARK)
Questions and Replies
This document reproduces questions addressed to the Parties and the responses submitted.
The questions and replies set out below are organized in accordance with document WT/REG64/3.
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I. BACKGROUND INFORMATION ON THE AGREEMENT
1. Membership and Dates of Signature, Ratification and Entry into Force
Please confirm whether this Free Trade Agre ement (FTA) shall be applied with a view
to establishing free trade between just Estonia and the Faroe Islands, or whether it will enable
the establishment of free trade between Estonia and Denmark as a whole?
The Free Trade Agreement between the Faroe Islands and Estonia establishes a
free-trade area, comprising of the Faroe Islands and Estonia (Article 1).  The Agreement therefore
enables free trade only between the Faroe Islands and Estonia.
II. TRADE PROVISIONS
1. Import Restrictions &
2. Export Restrictions
We appreciate the provision of trade and tariff statistics on intra FTA-trade from the
Parties.  We would also like the Parties to confir m that they have complied with Article 3 of the
Agreement stating that "the contracting parties sh all abolish between them on the date of entry
into force all customs duties on imports and exports…".  What items, if any, are exempt from
this provision?
Please provide additional information on the products for which duties are being
eliminated and on the products in which duti es and other restrictive regulations of commerce
remain.  What share of trade/lines are subject to  duty-free treatment?  To non-zero preferential
treatment?  What products are excluded from coverage?
The Agreement applies to products falling within Chapters 1 to 97 of the Harmonized
Commodity Description Coding System originating in the Faroe Islands or Estonia.  Duties are being
eliminated on all products except as provided for in Protocol 1 (attached).WT/REG64/4
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3. Rules of Origin
Please describe the rules of origin regime.  How do the rules of origin in this Agreement
interface with the preferential agreements that Estonia and the Faroe Islands have with other
European countries?
The Protocol on Rules of Origin laid down in the Agreement between the Faroe Islands and
Estonia is a standard Protocol on Rules of Origin.  It is very similar to the Protocols on Rules of
Origin in the FTAs between the EFTA States and the Central and Eastern European countries.  It does
not interface with the preferential agreements that Estonia and the Faroe Islands have with other
European countries, in the sense of for example cumulation, as the Protocol on Rules of Origin only
provides for bilateral cumulation.
8. Sector-specific Provisions
Information in the standard format indica tes that Estonia may increase tariffs on
agricultural items.  Please explain.
See Protocol 1 (attached).  However, Estonia has decided not to introduce customs tariffs on
trade with the Faroe Islands.
Please clarify the scope of restrictions, if any, applied on agricultural products.
See Protocol 1 (attached).
9. Other
Which public monopolies are subject to the provisions of this Agreement?
Article 14 (Public Monopolies) of the Agreement states that the Contracting Parties shall
adjust progressively any state monopoly of commercial character so as to ensure that no
discrimination regarding the conditions under which goods are procured and marketed exist between
nationals of the Contracting Parties.
Do the parties intend to accede to the Government Procurement Code?
The Faroe Islands do not at present intend to accede to the Government Procurement Code.
Estonia has taken a commitment to accede to the Ag reement on Government Procurement, so that if
the results of the negotiations were satisfactory to the interests of Estonia and other members of theAgreement, Estonia would complete negotiations for membership by 31 December 2000.
III. GENERAL PROVISIONS OF THE AGREEMENT
4. Relation with Other Trade Agreements
Could the parties indicate whether their me mbership in these agreements limit in any
their ability to make concessions in multilateral negotiations?
The membership in this Agreement does not limit the ability to make concessions in
multilateral negotiations.WT/REG64/4
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Services
Are there any plans for companion agreements on services?
There are at the moment no plans for companion agreements on services.WT/REG64/4
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ANNEX
Protocol 1
1. The Contracting Parties shall continue in their efforts with a view to achieve further
liberalization of trade in agricultural products within the framework of their respective agricultural
policies and their international commitments.
2. Taking into account that the Faroe Islands have maintained tariffs and duties on import of
following agricultural goods:
CN Code Description
ex 0204 Meat of sheep and goats, fresh, chilled or frozen
02068099 Edible offal of sheep and goats, fresh or chilled
02069099 Edible offal of sheep and goats, frozen
02109011 Meat of sheep or goats, salted, in brine, dried or smoked, with
brine in
02109060 Edible meat offal of sheep or goats, salted, in brine, dried or
smoked
ex 02109090 Edible flours and meals of meat and meat offal, of sheep and
goats
0401 Milk
0402 Milk and cream, concentrated or containing added sugar or other
sweetening matter
0403 Buttermilk, curdled milk and cream, yoghurt, kephir and other
fermented or acidified milk and cream, whether or not
concentrated or containing added sugar or other sweeteningmatter or flavoured or containing added fruit, nuts or cocoa
ex 1601 Sausages or similar products of meat, meat offal or blood; food
preparations based on these products: - Of sheep and goats
ex 1602 Other prepared or preserved meat, meat offal or blood:
 - Of sheep and goats
In order to take account of differences in the cost of processed agricultural goods, this Agreement
does not preclude:
(a) The levying, on import of an agricultural component or fixed amount, or the
application of internal price compensation measures;
(b) the application of measures adopted on export.
3. Taking into account the Estonian customs tariff structure on the date of entry into force of this
Agreement, where no customs duties are applied for agricultural products, in the event that as a result
of Estonians accession to the WTO a new tariff regime for the agricultural products is established.Estonia may, by way of derogation from the provisions of this Article and pursuant to the
implementation of its agricultural policy introduce customs duties on a limited number of agricultural
products originating in the Faroe Islands.
4. With reference to paragraph 3 of this Protocol, customs duties on imports may be introduced
by Estonia during the first two years following the entry into force of this Agreement and after
consultations in the Joint Committee.  If necessary the period of two years may be prolonged by one
year by the decision of the Joint Committee.
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