Explanatory Memorandum to COM(2012)106 - Conclusion of Agreements on the modification of concessions with respect to processed poultry meat between the EU and Brazil, and between the EU and Thailand

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1. CONTEXT OF THE PROPOSAL

Negotiations under Article XXVIII of GATT 1994 concluded on poultry in 2007 (OJ L138 30.5.2007) covered tariff lines on poultry meat under heading 0210 as well as one processed poultry line, 1602 32 19 in the EC Schedule CXL: cooked preparations containing more than 57% of poultry meat. Limiting the negotiations to the processed poultry line 1602 32 19 was considered to sufficiently prevent potential substitution effects. Subsequent import data, however, showed a dramatic import surge of processed poultry meat under tariff line 1602 32 30: preparations containing 25% or more but less than 57% by weight of poultry meat or offal. This indicated that exporters seemed to take advantage of a relative gap in the EU level of protection, substituting poultry preparations containing more than 57% of poultry meat with preparations containing less than 57%, under tariff line 1602 32 30. Comparable substitution effects were to be expected under other 1602 tariff lines in the future. In order to comprehensively address these substitution effects affecting the EU poultry industry, the Commission requested from the Council the authorisation to renegotiate the concessions on poultry meat under Chapter 16 of the CN.

On 25 May 2009 the Council authorised the Commission to open negotiations under Article XXVIII of the GATT 1994 (COM proposal 8615/09 WTO 72 AGRI 166) with a view to the renegotiation of concessions on poultry meat tariff lines under Chapter 16 of the CN.

On 16 June 2009 the communication of the EU's intention to modify the concessions on items 1602 20 10, 1602 32 11, 1602 32 30, 1602 32 90, 1602 39 21, 1602 39 29, 1602 39 40 and 1602 39 80 included in Schedule CXL of the European Communities was circulated to the other WTO Members.

Negotiations have been conducted by the Commission in consultation with the Trade Policy Committee and within the framework of the negotiating directives issued by the Council.

The Commission has negotiated with the Federal Republic of Brazil and with the Kingdom of Thailand holding each principal supplying interests and/or substantial interests in various of the tariff lines concerned.

The negotiations have resulted in Agreements in the form of exchanges of letters initialled with the Kingdom of Thailand on 22 November 2011 and with the Federal Republic of Brazil on 7 December 2011.

The agreements were negotiated on the basis of the Combined Nomenclature codes in force at the time.

In the newest version of Annex I to Council Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff as laid down in Commission Regulation (EU) No 1006/2011 published in OJ L 282 of 28 October 2011, the tariff lines 1602 39 40 and 1602 39 80 have been merged into a new tariff line 1602 39 85. It is therefore appropriate to reflect this new situation in the implementing regulation.

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BUDGETARY IMPLICATION



See Financial Fiche in Annex.