title: Council Decision of 29 September 1970 on the Association of the Overseas Countries and Territories with the European Economic Community

text:
164                                     Official Journal of the European Communities
 28.12.70                               Official Journal of the European Communities                               No L 282/83
                                                    COUNCIL DECISION
                                                     of 29 September 1970
               on ths Association of the Overseas Countries and Territories wstii the European Economic
                                                           Community
                                                         ( 70/549/EEC)
 rHE COUNCIL OF THE EUROPEAN COMMUNITIES,                           nity (hereinafter called 'countries and territories ) mustt
                                                                    be laid down for a further period,
 Having regard to the Treaty establishing the European
 Economic Community , and in particular Article 136                HAS DECIDED AS FOLLOWS :
 thereof:
 Having regard to the Internal Agreement on the Financ
                                                                                Article 1
 ing and Administration of Community Aid signed at
 Yaounde on 29 July 1969, and in particular Article 1              This Decision aims to promote the economic and social
 thepeof:                                                          development of the Overseas Countries and Territories
                                                                   associated with the Community by increasing their trade
 Hiaving regard to the draft from the Commission ;                 and through financial measures and technical coopera
                                                                   tion .
 Having regard to the Opinion of the European Parlia
 men :                                                             The Community also intends to develop the economic
                                                                   relations between the Community and the Overseas
 Whereas the provisions applieable to the Association of           Countries and Territories and thereby to contribute to
 the Overseas Countries and Territories with the Commu            strengthening the structure of their economies.
                                                             TITLE I
                                                         •   TRADE
                         Chapter I                                 - products subject, on importation into the Community,
                                                                        to specific rules as a consequence of the implementa
         Customs duties and quantitative restactions                    tion of the common agricultural policy.
                           Article 2                               Annex I to this Decision states the conditions under
 1 . Products originating in the countries and territories         which the Community , notwithstanding the general
shall, on importation into the Community , be admitted              treatment in force in relation to third countries , shall de
free of customs duties and charges having equivalent ef            termine the treatment to be applied to the products re
fect ; however, the treatment applied to these products             ferred to above, when such products originate in the
                                                                    countries and territories .
shall no' be more favourable than that applied by the
Member States among themselves.
                                                                                Articled
 2. Paragraph ! shall not, however, prejudice tk3 import            1 . Imports of products originating in the Community
treatment applied to :                                             and in other countries and territories shall be admitted
- such products listed in A ^nex II to the Treaty as come          into each country or territory free of customs duties and
     under a common organization of the market within              charges having equivalent effect.
     the meaning of Article 40 of the Treaty ;
                                                                   2. The competent authorities of a country or territory
                                                                   may , however, retain or introduce, in accordance with
1 OJ No C 40, 3.4.1970, p" 32.                                     Annex II to this Decision, customs duties and charges
 ---pagebreak---                                         Official Journal of the European Communities                                         165
 having equivalent effect required to meet the develop            Quantitative restrictions or measures having equivalent
 ment needs of the country of territory or intended to con        effect may be applied, if necessary, at the same time as
 tribute to their budgets.                                         the tariff measures referred to in Article 3 (2).
 3. The same treatment shall be granted in each country             3. Application of the quantitative restrictions or meas
 or territory to products originating in each of the Mem           ures having equivalent effect provided for in paragraph 2
 ber States or in other countries or territories.                  shall not give rise, in law or in fact, to discrimination
                                                                   between Member States, countries or territories.
                           Article 4
                                                                    4. The competent authorities of countries and territories
 Where a country or territory levies duties on exports of           in which imports come within the province of a State
 its products to Member States or to other countries and            monopoly of a commercial character or of any public
 territories, these duties may not give rise, in law or in          body which, in law or in fact, directly or indirectly limits
 fact, to any direct or indirect discrimination between             imports, shall take any steps necessary to attain the ob
 Member States or other countries and territories.                 jectives defined in this Title, and in particular that of
                                                                    non-discrimination between Member States and other
                           Article 5                                countries and territories.
  1 . Without prejudice to the special provisions laid down
 in this Decision, Member States shall refrain from any                                       Articles
 internal fiscal measure or practice that directly or indi
                                                                    Articles 6 and 7 shall not preclude prohibitions or res
 rectly leads to discrimination between their own prod
 ucts and like products originating in the countries and
                                                                    trictions on imports, exports or goods in transit justified
 territories.
                                                                    on grounds of public morality, public policy or public
                                                                    security ; the protection of health and life of humans,
                                                                    animals or plants; the protection of national treasures
 2. Without prejudice to the special provisions laid down
                                                                    possessing artistic, historic or archaeological value; or
 in this Decision, the competent authorities of the coun
 tries and territories shall refrain from any internal fiscal
                                                                    the protection of industrial and commercial property.
 measure or practice that directly or indirectly leads to           Such prohibitions or restrictions shall not, however, con
 discrimination between products of those countries and
 territories and like products originating in the Commu
                                                                   stitute a means of arbitrary discrimination or a disguised
                                                                    restriction on trade.
 nity or in other countries and territories.
                                                                                Article 9
                           Articled
                                                                     1 . For the purposes of implementing this title, the con
 1 . The Community shall not apply to imports of prod              cept of 'originating products', and the methods of admin
ucts originating in the countries and territories any quan         istrative cooperation relating thereto, defined pursuant to
titative restrictions or measures having equivalent effect         the Council Decision 1 of 25 February 1964 on the Asso
other than those that the Member States apply among                ciation of the Overseas Countries and Territories with
themselves .                                                        the European Economic Community, shall continue to
                                                                   apply.
2. Paragraph 1 shall not, however, prejudice the import
treatment accorded to the products referred to in the first         2. The Council, acting unanimously on a draft from the
indent of Article 2 (2), or to products which are the sub         Commission, may adopt any amendment to the texts re
ject of worldwide agreements.                                      ferred to in paragraph 1 .
                           Article 7                                3. If for any product the concept of 'originating prod
                                                                   ucts' has not been defined pursuant to paragraphs 1 or 2,
1 . Subject to the provisions of this Article, the compe          the Community and the competent authorities of the
tent authorities of the countries and territories shall re
                                                                   overseas countries and territories shall continue to apply
frain from applying any quantitative restrictions or               their own rules.
measures having equivalent effect to imports of products
originating in Member States or in other countries and
territories.                                                                                Chapter II
2. The competent authorities of the countries and terri                     Provisions concerning commercial policy
tories may, in accordance with the procedure laid down
                                                                                Article 10
in Annex III to this Decision , retain or introduce quanti
tative restrictions or measures having equivalent effect           Subject to the special provisions for frontier-zone traffic
on imports of products originating in Member States and            and without prejudice to Articles 1 1 and 12 :
in other countries and territories in order to meet their
development needs or in the event of difficulties arising
 in their balance of payments.                                     1 OJ No 93, 11.6.1964, p. 1472/64.
 ---pagebreak--- 166                                       Official Journal of the European Communities
- the treatment applied in countries and territories by              The French Republic and the Kingdom of the Nether
     virtue of this title to products originating in the             lands shall keep the Commission informed of matters
     Community and in other countries and territories                falling within their respective spheres and the Commis
     shall not be less favourable than that applied to prod         sion, in its turn , shall inform the other Member States .
     ucts originating in the most favoured third State;
- the treatment applied in countries and territories by              At the request of a Member State pr of the Commission
                                                                     there shall be cpnsultations within the Council .
     virtue of this title to products originating in those
     countries and territories and destined for the Commu
     nity or for other countries and territories shall not be
                                                                                A rticle 14
     less favourable than that applied to products destined
     for the most favoured third State.                               1 . With regard to commercial policy the French Re
                                                                     public and the Kingdom of the Netherlands shall, each
                                                                     for its part, inform the Commission of any measures
                                                                     taken regarding trade between the countries and territo
                             Article 11
                                                                     ries and third countries. The Commission shall inform
1 . Customs unions or free trade areas may be main                  the other Member States.
tained or established . and economic cooperation agree
ments may be concluded between countries and territo                2. At the request of a Member State or of the Commis
ries.                                                                sion, consultations shall be held in the Council if such
                                                                     measures might be prejudicial to the interests of one or
2. The French Republic and the Kingdom of the Nether                more Member States or of the Community .
lands shall keep the Commission informed of matters
falling within their respective spheres, and the Commis             3. A Member State or the Commission may likewise
sion, in its turn, shall inform the other Member States.             request that consultations be held on measures of com
                                                                     mercial policy adopted by a Member State towards third
                                                                     countries, if such measures might be prejudicial to the
                             A rticle 12                             interests of a country or territory .
 1 . Customs unions or free trade areas may be main
tained or established and economic cooperation agree
ments may be concluded between one or more countries
and territories and one or more third countries in the                                           Chapter III
same geographical area and at a comparable stage of
development, provided that provisions concerning the                                         Protective clauses
origin of products in implementation of this Decision are
not thereby affected.                                                                            Article 15
                                                                      1 . If serious disturbances occur in a sector of the econ
The French Republic and the Kingdom of the Nether
                                                                     omy of a country or territory or prejudice its external
lands shall keep the Commission informed of matters
                                                                     financial stability, the competent authorities of the
falling within their respective spheres, and the Commis             country or territory may take protective measures.
sion , in its turn , shall inform the other Member States.
                                                                     Such measures and the rules for their application shall be
2. At the request of a Member State or of the Commis                 notified without delay to the Commission by the French
sion there shall be consultations within the Council .
                                                                      Republic and ^he Kingdom of the Netherlands, each for
                                                                      its part.
3. If these consultations reveal any incompatibility be
tween the undertakings given by the countries and terri             The Commission shall inform the other Member States.
tories referred to in paragraph 1 and the principles or
                                                                     At the request of a Member State or of the Commission
provisions of this Decision, the Council shall take any               there shall be consultations on the measures within the
measures necessary for the proper functioning of the                  Council .
Association. It may also make any necessary recommen
dations.
                                                                      2. If serious disturbances occur in a sector of the econ
                                                                      omy of the Community or of one or more of its Member
                                                                      States, or prejudice their external financial stability, or if
                             Article 13
                                                                      difficulties arise which adversely affect the economic si
Customs unions or free trade areas may likewise be                    tuation of a given area of the Community, the Commis
maintained or established and economic cooperation                    sion may take, or may authorize the Member State or
agreements may be concluded between one or more                       States concerned to take, the necessary protective meas
countries or territories and one or more other third coun            ures, including measures to counter deflection of trade.
tries, if they are compatible with this Decision and in
particular with Article 10 thereof, and with provisions              At the request of any Member State concerned, the
adopted in implementation of Article 9.                               Council, acting by a qualified majority, shall decide
 ---pagebreak---                                        Official Journal of the European Communities                                        167
whether to uphold, repeal or amend the Commission                  The Council, acting in accordance with the voting proce
Decision.                                                          dure laid down in Article 1 1 1 (3) of the Treaty on a pro
                                                                   posal from the Commission, shall decide upon any
In case of urgency the Member State concerned may it              amendments which may need to be made to this para
self take the necessary protective measures. It shall              graph in consequence of the introduction of a common
immediately inform the Commission, and the Commis                 commercial policy.
sion shall inform the other Member States. The Com
mission may decide whether these measures shall be
amended or abolished. The provisions of the preceding
subparagraph shall then apply.                                     3. In the application of paragraphs 1 and 2, preference
                                                                  shall be given to such measures as will least disturb the
In case of serious balance of payment difficulties a              functioning of the Association and the Community . The
Member State may take the necessary measures in ac               scope of these measures must not exceed what is strictly
cordance with Articles 108 and 109»of the Treaty .                necessary to remedy the difficulties that have arisen.
                                                           TITLE II
                                             Financial and technical cooperation
                         Article 16                                                         A rticle 18
In accordance with the provisions of this Title and of             1 . The amount fixed in Article 17 shall be used for the
Annexes V , VI and VII to this Decision, the Community            financing of projects and programmes set up as far as
shall participate in measures, complementary to the ac           possible within the framework of a development plan
tion taken by the competent authorities of the countries          and relating to :
and territories, to promote their economic and social             - investment in production plant and economic and
development.                                                           social infrastructure, in particular with a view to
                                                                       diversifying the economic structure of the countries
                         Article 17                                    and territories and, especially, to promoting their
For the purposes stated in Article 16. and for the period              industrialization and agricultural development;
of validity of this Decision, an aggregate amount of 82           - general technical cooperation, or technical coopera
million units of account shall be supplied, with a view to             tion linked with investments ;
covering the whole of the Community's aid, as follows :           - operations to promote the marketing and sale of prod
(a) 72 million units of account by the Member States.                  ucts exported by the^ountries and territories.
    This amount shall be paid into the European De
     velopment Fund (hereinafter called the 'Fund')                2. Decisions on the various measures provided for in
    and used as follows :                                          paragraph 1 shall take into account :
    - 62 million units of account in the form of non             - the desirability of achieving integrated schemes by
        reimbursable grants,                                           means of harmonized application of these measures;
    - 10 million units of account in the form of loans on         - the desirability of promoting regional cooperation
        special terms and of contributions to the forma               between the countries and territories and, where ap
        tion of risk capital, in particular by participating           propriate, between them and one or more neighbour
        in it.                                                         ing countries.
     A breakdown of the amounts is given, for reference
     purposes, in Annex V to this Decision;
(b) up to 10 million units of account by the European
                                                                                Article 19
    Investment Bank (hereinafter called the 'Bank') in the
    form of loans extended on the terms set out in Annex           1 . The competent authorities of the countries and terri
    VI to this Decision and in the Statute of the Bank.           tories shall, if possible from the time of entry into force
                                                                  of this Decision, inform the Commission of their de
    A breakdown of the amounts is given, for reference            velopment plans and programmes and of any measures
     purposes, in Annex V to this Decision.                       for which they wish to seek financial help.
    The Bank's loans may carry a rebate on the interest.
     The aggregate cost of the interest rebates on loans to       They shall communicate any later modifications.
     overseas countries and territories after 1 June 1964
     shall be charged against the total of the non-reim          2. Documentation shall be transmitted to the Commu
     bursable grants.                                             nity for each project or programme for which financing
 ---pagebreak--- 168                                     Official Journal of the European Communities
is requested pursuant to Article 18, either by the compe                specialist bodies and institutions or, exceptionally ,
tent authorities in agreement with the local authorities or              undertakings whose business is the training of speci
with a body representing the inhabitants of the countries                alists, and scholarship holders, trainees or persons
and territories concerned, or by the undertaking in ques                following training courses;
tion with the approval of those authorities.
                                                                    (b) of loans from the Bank and the rebates on interest
                                                                         thereon, loans on special terms, contributions to the
 However, the Community may , where necessary , draw                     formation of risk capital and any non-reimbursable
 up technical cooperation projects and programmes for                    grants made for technical cooperation linked with
 the benefit of a country or territory . It shall first secure           investments :
 the consent of the competent authorities of the country
 or territory on the broad outlines of each project or pro-,              undertakings applying industrial and commercial
 gramme.                                                                  management methods and ferried within the mean
                                                                          ing.of the third and fourth paragraphs of Article 31 .
                            Article 20
                                                                                A rticle 23
The Community shall examine requests for financing
referred to it pursuant to Article 19. It shall maintain            1 . As regards measures financed by the Community ,
such contact with the competent authorities of the coun           participation in tendering procedures and other proce
tries and territories as it may require in order that its de      dures for the award of contracts shall be open, on equul
cisions on the projects or programmes submitted to it              terms, to all natural and legal persons of the Member
may be taken in full knowledge of the facts, and in order          States, countries and territories.
to be able to contribute to the promotion of a harmon
 ious and balanced development of the various countries            2. The provisions of paragraph 1 shall be without preju
and territories. In examining these requests the Commu            dice to measures intended to assist construction or large
nity shall take into account the particular problems fac          or small-scale production undertakings of the associated
 ing the countries and territories which are at the greatest       country or territory concerned or of another associated
disadvantage in order to ensure that they receive ap              country or territory in the same area to take part in the
propriate financial and technical aid.                             execution of public works contracts of limited size or of
                                                                   contracts for the supply of goods of a kind produced
The country or territory or group of countries and terri          locally.
tories concerned shall be informed of the action taken on
 their request.
                                                                                Article 24
     •»                     Article 21
                                                                   The French Republic and the Kingdom of the Nether
                                                                   lands shall endeavour to obtain assurances from the
Aid contributed by the Community for the execution of              competent authorities of the countries and territories to
certain projects or programmes may, with the consent of            the effect that the provisions in force on 31 May 1969
the competent authorities of the country or territory or           concerning the fiscal and customs arrangements appli
countries and territories concerned, take the form of co          cable to contracts financed by the Community will be
financing in which, in particular, credit and development          adhered to.
bodies and institutions of the countries and territories .
Member States, third States or international finance or
ganizations may take part.
                                                                                Article 25
                                                                   1 . The amounts allocated for financing projects or pro
                            Article 22                             grammes under this Title shall be expended in accord
                                                                ~  ance with agreed allocations and to the best economic
The following may be recipients of the various forms of
                                                                   advantage.
Community aid provided for in Article 18 : countries and
territories ; legal persons in the Member States or in the
                                                                   2. The management and upkeep of the economic and
countries and territories provided that their main objec
                                                                   social infrastructure and of the production plant pro
tive is non-profit-making, that their work is in the general
                                                                   vided through Community aid shall be the responsibility
interest and that they are subject to government control
                                                                   of the recipients.
in those Member States, countries and territories ; pro
ducer groups or similar approved bodies or, in the ab
sence thereof, and exceptionally, individual producers
themselves .
                                                                                A rticle 26
In addition the following may be recipients :                      The provisions of this TitSt md of Annexes V , VI and
(a) of Hon-f©jmbursable gras 5 -s .tevoted to general tech        VII to this Decision shall apply also to the French over
      rassa!! s operation :                                        seas departments.
 ---pagebreak---                                        Official Journal of the European Communities                                         169
                                                           TITLE III
                    RIGHT OF ESTABLISHMENT, SERVICES, PAYMENTS AND MOVEMENTS
                         Article 27                               companies or firms formed in accordance with the law of
The rules applied in the countries and territories as re         a Member State and whose registered office, central
gards the right of establishment or the provision of ser         administration or principal place of business is in a
vices shall not, in law or in fact, constitute, either direct    Member State; however, a company or firm having only
ly or indirectly, discrimination between nationals, com           its registered office in a Member State must, in order to
panies or firms of individual Member States.                      set up agencies, branches or subsidiaries therein, be en
                                                                  gaged in an activity which has an effective and contin
Nevertheless, nationals, companies or firms of a Member            uous link with the economy of that Member State.
State may avail themselves of the provisions of the first
paragraph in respect of a given activity in a country or           For the purposes of the second paragraph of Article 27,
territory only in so far as the State to which they belong         'companies or firms of the French Republic or of the
grants similar advantages for the same activity to nation         Kingdom of the Netherlands' established in a country or
als, companies or firms of the French Republic or of the           territory means companies or firms formed in accord
Kingdom of the Netherlands, as the case may be, as well            ance with French or Dutch Law, as the case may be, and
as to companies or firms subject to the laws of the coun         whose registered office, central administration or princi
try or territory concerned and established therein.                pal place of business is in that country or territory; how
                                                                   ever, a company or firm having only its registered office
                                                                   in a country or territory must, in order to set up agen
                         Article 28                                cies, branches or subsidiaries therein, be engaged in an
                                                                   activity which has an effective and continuous link with
Where, in a country or territory, nationals, companies or          the economy of that country or territory.
firms of a State which is neither a Member State of the
Community nor a country or territory receive treatment
                                                                   For the purposes of the second paragraph of Article 27,
more favourable than that afforded under this Title to
                                                                  'companies or firms subject to the laws of the country or
nationals, companies or firms of Member States, the                territory concerned and established therein' means com
same treatment shall be extended to nationals, com
                                                                   panies or firms formed under the law of a given country
panies or firms of Member States, save where it results            or territory and whose registered office, central adminis
from regional agreements.
                                                                   tration or principal place of business is in that country or
                                                                   territory; however, a company or firm having only its
                         Article 29                               registered office in that country or territory must, in
                                                                  order to set up agencies, branches or subsidiaries therein,
Subject to the provisions relating to capital movements,
                                                                  be engaged in an activity which has an effective and con
the right of establishment shall, for the purposes of this
                                                                   tinuous link with the economy of that country or terri
Decision, include the right to engage in and to exercise
                                                                   tory.
self-employed activities; to set up and manage undertak
ings, in particular, companies or firms; and to set up
                                                                                Article 32
agencies, branches or subsidiaries .
                                                                   Payments connected with the movement of goods, ser
                                                                   vices, capital or earnings, or the transfer of these pay
                         A rticle 30
                                                                   ments to the Member State or the country or territory in
 For the purpose of this Decision, 'services means such           which the creditor or recipient resides, shall not be sub
 services normally provided against remuneration as are           ject to any restriction to the extent that the movement of
 not governed by the provisions relating to trade, the right       goods, services, capital and persons has been liberalized
 of establishment or capital movements. Services shall             pursuant to this Decision.
 include activities of an industrial, commercial, craft or
 professional nature, but not those of employed persons.
                                                                                Article 33
                         Article 31                                Throughout the period of subsistence of the loans and
                                                                   participations provided for in Chapter II of Annex VI to
For the purposes of this Decision, 'companies or firms             this Decision
means companies or firms constituted under civil or
commercial law, including cooperative societies, and               - the currency necessary for the repayment of capital,
                                                                       interest and commission on loans granted for the exe
other legal persons governed by public or private law,
save for those which are non-profit-making.                            cution of projects in the countries and territories shall
                                                                       be made available to debtors;
For the purposes of the first paragraph of Article 27,             - the currency necessary for the transfer of all the sums
' companies or firms of individual Member States' means                representing the revenue and proceeds from transac
 ---pagebreak--- 170                                    Official Journal of the European Communities
    tions contributing to the formation of the risk capital       territories in respect of their investments and to capital
    6f undertakings shall be made available to the Bank.          movements resulting therefrom.
                         Article 34
                                                                                Article 35
The competent authorities shall endeavour to apply lib
eral exchange arrangements to investments in the coun            The Council shall take the measures necessary for the
tries and territories and to transfers connected with capi       application of this Title under the same voting procedure
tal movements resulting therefrom, where these are made           as that laid down by the Treaty in comparable fields.
by persons residing in the Member States.
                                                                  To that end, it shall issue Directives and take decisions,
Nationals and companies or firms of Member States                 acting on proposals from the Commission. It may also
shall be treated on an equal footing in the countries , and       make recommendations or deliver Opinions.
                                                          TITLE IV
                                          GENERAL AND FINAL PROVISIONS
                         Article 36                               cation of the principles laid down in Articles 131 to 135
This Decision shall enter into force at the same time as          of the Treaty .
the Internal Agreement on the Financing and Adminis
tration of Community Aid signed at Yaounde on 29 July
 1969.                                                                                A rticle 40
                                                                  The date of entry into force of this Decision shall be
                                                                  published in the Official Journal of the European Com
                         Article 37                               munities .
This Decision shall be valid for five years from the date
of its entry into force and shall expire not later than 31
                                                                                Article 41
January 1975 .
                                                                  This Decision shall be published in the Official Journal
                                                                  ofthe European Communities.
                         Article 38
The countries and territories to which this Decision shall
apply are listed in Annex VIII .
                                                                 JDone at Brussels, 29 September 1970.
                         Article 39                                                                    For the Council
Before the date of expiry of this Decision the Council,                                                 The President
acting unanimously, shall adopt provisions for the appli                                              S. von BRAUN
 ---pagebreak---                                               Official Journal of the European Communities                                                  171
                                                                    ANNEXI
                                              . on the application of Article 2 (2) of the Decision
                               Article 1                                     liable to customs duties on importation into the Community
1 . The Community shall determine, case by case, what treat                 and if under the common agricultural policy there is no provi
ment is to be accorded to imports of each of the products, or                sion for trade in those products with third countries, their im
groups of products specified in Article 2(2) of the Decision                  portation into the Community shall, notwithstanding Article 1 ,
and originating in the countries and territories where the latter            be governed by Article 2 ( 1) of the Decision.
have an economic interest in exporting such products.
The treatment which the Community applies to these products
shall be more favourable than the general treatment applied to                                             Article 3
like products originating in third countries.
                                                                              1 . The treatment laid down for the various products on the
2. However, the Community may , exceptionally , refrain from
                                                                             basis of this Annex shall apply until the expiry of the Decision.
applying special treatment to a particular product from the
countries and territories if the economic situation in the Com              2. However, in the event of a change in the Community organ
                                                                             ization of markets, the Community reserves the right to modify
munity in respect of that product so justifies                               the treatment laid down .
                               Article 2
                                                                              3 . In that event, the Community undertakes to extend to the
If products originating in the countries and territories and spe            countries and territories under the new treatment advantages
cified in the first indent of Article 2(2) of the Decision are               comparable to those which they enjoyed previously .
                                                                   ANNEX II
                                                 on the application of Article 3 of the Decision
                               Article 1                                                                   Article 3
The development needs of the countries and territories referred               1 . The French Republic and the Kingdom of the Netherlands
to in Article 3 (2) of the Decision are those arising from :                 shall, each for its part, inform the Commission in good time of
- the implementation of- economic development programmes
                                                                             any customs duties or charges having equivalent effect which it
     aimed at raising their general standard of living,                       is proposed to introduce or increase pursuant to Article 3 ( 2) of
                                                                             the Decision .
- their requirements for economic development, in particular
     for promoting new branches of production with a view to                 The communication shall include all economic and financial
     raising their general standard of living,                                information enabling the need to introduce or retain these
                                                                             measures to be assessed.
- their need to balance their payments and to counter difficul
     ties arising mainly from their efforts to expand their domes
     tic markets but also from instability in their terms of trade,           2. The Commission shall immediately inform the other Mem
                                                                             ber States of the proposed measures and shall supply them
- the need to achieve a rapid and sustained increase in export               with the information mentioned in paragraph 1 . It shall inform
     income.                                                                 them of its observations, if any, on these measures.
                               Article 2
                                                                             At the request of a Member State or of the Commission consul
                                                                             tations shall take place in the Council on the measures before
 1 . The French Republic and the Kingdom of the Netherlands                  their entry into force. If such consultations have . not been held
shall, each for its part, communicate to the Commission, with               within two months following the date on which the French
in three months following the entry into force of the Decision ,             Republic or the Kingdom of the Netherlands informed the
the customs tariff or the complete list of customs duties and                Commission of the proposed measures, the measures may enter
charges having equivalent effect which the countries or territo             into force.
ries levy on imports of products originating in the Community ,
in the other countries and territories and in third countries .               3. In justifiable cases of urgency the measures may provision
                                                                             ally enter into force even before consultation, if the Commis
The communication shall specify the customs duties and                       sion is simultaneously informed thereof.
charges having equivalent effect which, by virtue of Article
3 ( 2) of the Decision, will continue to apply to products origin
ating in the Community or other countries and territories.
                                                                                Article 4
2. The Commission shall communicate the customs tariffs or
the list referred to in paragraph 1 to the Member States and                 For the purpose of levying customs duties and charges having
shall inform the Council of its observations, if any , regarding             equivalent effect, which have been retained or introduced pur
them.                                                                        suant to Article 3 (2) of the Decision, the customs value of the
                                                                             goods shall be the price that they would actually fetch, at the
At the request of a Member State or of the Commission, there                  place and time of their introduction into the customs territory ,
shall be consultations within the Council on these customs                    in a sale in the open market between a buyer and a seller who
tariffs or lists.                                                            are independent of each other.
 ---pagebreak--- 172                                         Official Journal of the European Communities
                                                                   ANNEX III
                                                  on the application of Article 7 of the Decision
                              Article 1                                       ures may provisionally enter into force even before consulta
The development needs mentioned in Article 7 (2) of the Deci                  tion, if the Commission is simultaneously informed thereof.
 sion are those listed in Article 1 of Annex II .
                                                                               3. The Council shall hold the consultations referred to in para
                                                                              graphs 1 and 2 within two months following the date on which
                              Article 2
                                                                               the Commission is notified. If consultations do not take place
                                                                              within that period, the measures in question may be retained or
 1 . Quantitative restrictions and measures having equivalent                  introduced.
effect, which were in force on the date of entry into force of the
Decision and which have been retained by a country or territo
ry by virtue of Article 7 (2) of that Decision, shall be notified to                                       Articled
the Commission not later than three months after that date to
                                                                              The measures mentioned in Article 2 shall be applied subject to
gether with all explanations necessary for assessing the need to              the condition that the country or territory concerned maintains
retain ' them.
                                                                               import possibilities without discrimination in respect of prod
                                                                              ucts originating in the Community or in the other countries
The Commission shall immediately inform the other Member                      and territories.
States of the measures and shall supply them with the informa
tion mentioned in the first subparagraph. It shall inform them                The measures must be progressively relaxed so as to be elimi
of its observations, if any, on these measures.                               nated as far as possible by the end of a period to be determined
                                                                               in each case.
At the request of a Member State or of the Commission consul
tations shall take place in the Council on the measures.
                                                                                Article 4
2. The French Republic and the Kingdom of the Netherlands
shall, each for its part, inform the Commission in good time of               Where difficulties arise in the marketing of a particular product
any quantitative restrictions and measures having equivalent                  on the domestic market of a country or territory, the competent
effect which the competent authorities of a country or territory              authorities of that country or territory may, notwithstanding
intend to introduce in pursuance of Article 7 (2) of the Deci                Article 3 and on condition that the Commission has received
sion, together with all explanations necessary for assessing the              prior notice, suspend imports of that product for a limited per
need to introduce them.                                                       iod to be determined case by case, subject to the existence of
                                                                              those difficulties being demonstrated and subject to all expla
The Commission shall immediately inform the other Member                      nations necessary for assessing the need to prohibit such im
States of the proposed measures and shall supply them with the                ports being supplied.
information mentioned in the first subparagraph. It shall in
form them of its observations, if any, of these measures.                     The Commission shall immediately inform the other Member
                                                                              States of the proposed measures and of the explanations men
At the request of a Member State or of the Commission, con                   tioned in the first paragraph. It shall inform them of its obser
sultations on the measures shall take place in the Council with              vations, if any, on these measures.
in one month.
                                                                              At the request of a Member Sl .-c or of the Commission consul
In justifiable cases of urgency, in particular in respect of the              tations on the measures shall take place in the Council before
agricultural products of the countries and territories, the meas           . they enter into force.
                                                                   ANNEX IV
                 Declaration on the introduction of the generalized system of preferences within the framework of the
                                           United Nations Conference on Trade and Development
                 The Decision, and in particular Article 3 thereof, shall not preclude the introduction of a generalized
                 system of preferences, and in particular shall not preclude the overseas countries from participating
                 therein .
 ---pagebreak---                                           Official Journal of the European Communities                                                    173
                                                                  ANNEX V
                                          Breakdown provided for in Article 17 of the Decision
                                                                                Country
                                                                           Overseas countries with
                          Type of Aid              French overseas
                                                                                which the
                                                      territories                                           Total aid
                                                                                Netherlands
                                                   and departments           has special relations
                Non-reimbursable
                                                           30                         32                        62
                grants
                Loans on special                            6                           4                       10
                terms
                Total of non
                reimbursable
                                                           36                         36                        72
                grants and loans
                on special terms
                Bank loans                          not exceeding               not exceeding             not exceeding
                                                            5                           5                       10
                                                                  ANNEX VI
                                                  on the administration of financial aid
                             Chapter I                                   (0 temporary responsibility for the cost of technicians and of
                                                                              the provision of consumer goods necessary to the proper
                  NATURE OF OPERATIONS                                        execution of an investment project.
                             Article 1
The investments provided for in Article 18 of the Decision                                              Article 3
include :
                                                                         The general technical cooperation provided for in Article 18 of
(a) directly productive investments, especially in industry and          the Decision includes :
     tourism ;                                                           (a) the grant of scholarships for studies, training courses and
(b) development measures for the economy of rural areas, in                   postal tuition to provide, as a general rule in the countries
    particular measures to improve the structure of production,               and territories, for the vocational training of the nationals
    to diversify output and to increase productivity, in particu             thereof;
     lar through short-term measures ; these development meas           (b) the organization of specific training programmes in the
     ures may include specific applied research forming part of               countries and territories, in particular for the staff of public
     integrated projects;                                                     services and . institutions of the countries and territories or
(c) investments in economic and social infrastructure, includ                of undertakings therein;
     ing infrastructure designed to stimulate the local develop         (c) at the request of the countries and territories, the provision
     ment of industries and crafts.                                           of experts, advisers, technicians and instructors of the
                                                                              Member States, or of the countries and territories, for spe
                                                                              cific missions and for limited periods;
                             Article 2                                   (d) the supply of experimental and demonstration equipment;
The technical cooperation linked with investments provided for           (e) the organization of short training courses for nationals of
in Article 18 of the Decision includes :                                      the countries and territories and advanced training cpurses
                                                                              for civil servants of those countries and territories;
(a) planning and special and regional development studies;
                                                                         (0 sectoral studies;
(b) technical, economic and commercial studies, and research
    and advance planning required to prepare projects;                   (g) studies of the prospects and opportunities for economic
                                                                               development and diversification in the countries and terri
(c) aid in the preparation of documentation ;                                  tories;
(d) aid in the execution and the supervision of work;                    (h) general information and documentation to promote the
(e) temporary aid for the establishment, launching and opera                 economic and social development of the countries and ter
    tion of a specific investment or of installations, including              ritories, the development of trade between those countries
    where necessary the training of personnel for the operation               and territories and the Community, and the achievement of
    and maintenance of the investment or installations ;                      the aims of financial and technical cooperation.
 ---pagebreak--- 174                                          Official Journal of the European Communities
                               Article 4                                 2. The redemption period of each loan from the Bank shall be
                                                                         determined on the basis of the economic and financial charac
 The purposes of the marketing and sales promotion aid pro
 vided for in Article 18 of the Decision are :                           teristics of the project : that period may not exceed 25 years.
 (a) to improve the structure and working methods of organiza           3 . The rate of interest shall be the rate cnarged by the Bank at
       tions, services or undertakings contributing to the develop      the time of signature of the loan. Interest rebates on these loans
       ment of the external trade of the countries and territories or    may not reduce to less than 3% the rate of interest which the
       to promote the creation of such organizations, services or        recipient will actually bear. However, in the case of loans
       undertakings;                                                     granted through state controlled development financing institu
 (b) to promote participation by the countries and territories in        tions, the minimum rate to be borne by the intermediary bor
      international trade fairs and exhibitions;                         rower may not be less than 2%.
 (c) to train external trade and sales promotion specialists;            4. The total value of interest rebates, at the time of signature of
                                                                         the loan, calculated at a rate and according to rules to be laid
 (d) to undertake market surveys and market research and to
      encourage use of their results ;                                   down by the Community, shall be paid direct to the Bank.
 (e) to improve the dissemination of information in the Com
      munity and the countries and territories with a view to                                           Article 9
      developing trade.
                                                                         In order to encourage the execution of projects of general inter
                                                                         est to the economy of the country or territory concerned, the
                                                                         Community may contribute to the formation of risk capital by
                                                                         participating in it or by other appropriate methods, in such a
                              Chapter II                                 way as to increase the resources of the recipients referred to in
                                                                         Article 22 (b) of the Decision.
                    METHODS OF FINANCING
                                                                         These contributions shall be of a minority nature. They may be
                               Articles                                  made in conjunction with a loan from the Bank or, exception
 1 . Projects and programmes may be financed by non-reim                ally, with a loan on special terms.
bursable grants, by loans on special terms, by bank loans with
or without interest rebates or by several of these methods in
combination .
                                                                                Chapter III
 Furthermore, undertakings applying industrial and trade man
agement methods may , in respect of their investments, receive                                       USE OF AID
 contributions to the formation of their risk capital.
                                                                                Article 10
 2. The technical cooperation provided for in Articles 2, 3 and
 4 shall , however, be financed through non-reimbursable grants .        1 . The documentation prepared in accordance with Article
                                                                         19(2) of the Decision shall be submitted to the Community
                                                                        through the Commission. However, projects for which either a
                               Article 6                                loan from the Bank, with or without interest rebates, or a con
                                                                        tribution to the formation of risk capital is requested shall be
 Loans for the financing of economic investment projects shall          submitted to the Bank.
 be granted either direct to the recipient, or, where appropriate ,
 through the country or territory concerned or through a                2. The method of financing indicated in the request shall not
 national or multinational organization undertaking the                 prejudge the method of financing to be adopted by the Commu
 financing of development measures.                                     nity.
 The terms and conditions according to which the ultimate
 recipient receives the loans through the intermediary borrower                                        Article 11
 shall be drawn up simultaneously and by common accord bet              1 . Financial aid may be used to cover import expenses and the
ween the intermediary borrower and the Community insti                  local expenditure necessary for the execution of approved in
 tutions responsible for granting the loan.                              vestment projects.
                                                                         2. Such aid may not be used to cover current administrative
                               Article 7                                 maintenance and operating expenses.
 1 . Investment projects of general benefit to the economy of
the country or territory in which they are executed may be fin                                        Article 12
anced wholly or partly by means of loans on special terms
where the financial viability of these projects and the economic        The provisions relating to monopolies, and the quantitative res
situation of the countries and territories when the loan is grant      trictions retained or introduced pursuant to Article 7 of the
ed so allow.                                                            Decision and Annex III, shall not apply to imports into a coun
                                                                        try or territory where such imports are financed out of Com
2. Such loans may be granted for a period of up to 40 years             munity aid.
and for a redemption-free period of up to 10 years. It shall be
granted on favourable interest terms.
                                                                                Article 13
3 . The Community shall lay down the terms for these loans               The Community and the countries and territories shall collabo
and the rules for payment and repayment.                                 rate in all measures necessary to ensure that the amounts allo
                                                                         cated by the Community are used in accordance with Articles
                                                                         23 and 25 of the Decision.
                              Articles
 1 . Scrutiny by the Bank of the eligibility of projects and the                                       Article 14
granting of loans from its own resources shall be effected in
accordance with the rules, conditions and procedures provided °          The general clauses and conditions applicable to the award and
for in its Statute.                                                      execution of public works contracts financed by the Fund shall
 ---pagebreak---                                              Official Journal of the European Communities                                                 175
be the subject of a Recommendation adopted by the Council of                 2. The competent authorities of the countries and territories
the European Comminities acting unanimously on a proposal                    and, where appropriate, the institutions or other specialized
of the Commission, to be addressed to the Governments of the                 organizations of Member States or of the countries and territo
French Republic and the Kingdom of the Netherlands.                          ries shall be responsible for the execution of technical coopera
                                                                             tion measures.
                            Article 15
 1 . The competent authorities of the countries and territories
shall be responsible for the execution of the projects submitted                                          Article 16
in accordance with Article 19 ( 2) of the Decision and financed
by the Community . Furthermore, recipient undertakings shall                 The financial and administrative expenses of the Fund and the
be responsible, each for its part, for executing the project which           cost of supervising projects and programmes shall be charged
it submitted.                                                                to the fund allocated to non-reimbursable grants.
                                                                 ANNEX VII
                                                      on the value of the unit of account
                             Article 1                                                                    Article 3
The value of the unit of account used to express amounts in the              The unit of account defined in Article 1 shall remain un
Decision or in the provisions made in implementation thereof                 changed throughout the period of application of the Decision .
shall be 0.88867088 grammes of fine gold.                                    If however, before the end of that period a uniform proportio
                                                                             nate change in the par values of all currencies in relation to
                             Article 2                                       gold should be decided by the International Monetary Fund ,
                                                                             under Article IV , Section 7, of its Articles of Agreement, the
The parity of the currency of a Member State in relation to the
unit of account defined in Article 1 shall be the relation be               weight of fine gold contained in the unit of account shall alter
tween the weight of fine gold contained in the unit of account               in inverse ratio to th^t change.
and the weight of fine gold corresponding to the par value of
that currency communicated to the International Monetary                     If one or more Member States do not apply the Decision taken
Fund. If no par value has been communicated or if exchange                   by the International Monetary Fund referred to in the preced
rates differing from the par value by a margin exceeding that                ing subparagraph , the weight of fine gold contained in the unit
authorized by the Fund are applied to current payments , the                 of account shall alter in inverse ratio to the change decided by
weight of fine gold corresponding to the parity of the currency               the International Monetary Fund. However, the Council shall
shall be calculated on the basis of the exchange rate for a cur             examine the situation thus created and shall take the necessary
rency directly or indirectly expressed in and convertible into               measures , acting by a qualified majority as provided for in Ar
gold which is applied in the Member State to current payments                ticle 1 3 (3) of the Internal Agreement on the Financing and
on the day of the calculation, and on the basis of the par value             Administration of Community Aid, after receiving a proposal
communicated to the Monetary Fund for that convertible cur                  from the Commission and the Opinion of the Monetary Com:
rency .                                                                      mittee.
                                                                 ANNEX VIII
                                 List of the countries and territories referred to in Article 38 of the Decision
                (a) Overseas countries:
                     Surinam and the Netherlands Antilles.
                (b) Overseas territories:
                    Saint Pierre and Miquelon, the Comoro Archipelago, the French territory of the Afars and Issas,
                    New Caledonia and dependencies , Wallis and Futuna Islands, French Polynesia and the French
                    Southern and Antarctic Territories .
                                                                  ANNEX IX
                                     Declaration by the Government of the Kingdom of the Netherlands
                The Government of the Kingdom of the Netherlands draws attention to the constitutional structure of
                the Kingdom resulting from the Statute of 29 December 1954, and in particular to the autonomy of the
 ---pagebreak--- 176                               Official Journal of the European Communities
    non-European parts of the Kingdom, so far as concerns certain provisions of the Decision and the fact
    that the Decision was, in consequence, adopted in cooperation with the Governments of Surinam and
    the Netherlands Antilles pursuant to the constitutional procedure in force in the Kingdom.
    It declares that, for that reason and without prejudice to the rights and obligations devolving upon it
    under the Treaty and under the Decision, the Governments of Surinam and of the Netherlands Antilles
    will fulfil the obligations arising out of the Decision.