PREFERENTIAL RULES OF ORIGIN ADOPTION OF NEW GSP RULES PLENARY SESSION OF THE SECTORAL SOCIAL DIALOGUE COMMITTEE ON SUGAR Dominique LUND 1

PREFERENTIAL RULES OF ORIGIN APPLYING TO GSP – ADOPTION ! AFTER FIVE YEARS OF INTENSIVE WORK (Commission Green Paper March 2005) ADOPTION AT THE CUSTOMS CODE COMMITTEE ON 21 SEPTEMBER 2010 by a large majority (with the abstention of only 2 Member States) COMMISSION REGULATION EU N° 1063/2010 OJ L 307/1 of IMPLEMENTATION => FOR RULES DETERMINING THE ORIGIN => FOR THE REGISTERED EXPORTER SYSTEM 2

NEW COMMISSION REGULATION ON GSP RULES OF ORIGIN - OUTCOME MINIMAL OPERATIONS Art 78 g) Operations to colour or flavor or form sugar lumps, partial or total milling of crystal sugar m) Simple mixing of products, whether of not of different kinds Mixing of sugar with any material n) Simple addition of water or dilution or deshydratation or denaturation of products Minimal operations can never confer the origin, even in case of cumulation. They prevail over the list rules. These minimal operations will shortly be introduced in other EU unilateral arrangements 3

CUMULATION REFINING CANNOT CONFER THE ORIGIN REGIONAL CUMULATION  A new regional group is added to the three existing groups : Group I : South East Asia (Cambodia, Laos, Thailand...) Group II : Central America + Andean Community Group III : South Asia (Bengladesh, India, Sri Lanka) Group IV : MERCOSUR (Argentina, Brazil, Paraguay, Uruguay) => Cumulation between Group I & III might apply on request but only after decision of the Customs CODE Committee IN ADDITION ANNEX 13 B) excludes sensitive products from cumulation between an LDC and a non LDC country Group I & III : headings 1701 & 1702 are excluded as well as all sensitive products with a high sugar content (See Notice to Importers of 2007) Group IV : Chapters excluded. GENERAL LIST RULE UNCHANGED Not leading to a change in 4 digit heading, refining cannot confer the origin 4

NEW REGULATION : OTHER OUTCOMES LIST RULES ( Processing operations which confer the origin) For chapter 17 : change in 4 digit heading (unchanged) Headlines linked to colored or flavored sugars deleted, since considered as minimal operations (improvement) In chapter 17, the threshold of 40 % of non originating material applies only for heading 1704 (as well as to chapters 18,19,20, 21 ) instead of the current 30 % (change). GENERAL TOLERANCE RULE 15 % of the weight of the final product (compared to 15 % ex works in the EPA Regulation No.1528/2007) CALCULATION ON TOTAL SUGARS In case a threshold of non originating sugars is applying the calculation of total sugars will include the different sugars ( ) + the sugars comprised in the manufacture of materials incorporated in the final product (Improvement) 5

AS A CONCLUSION MORE SECURE RULES FOR THE SUGAR SECTOR All the requests of the sugar industry have been correctly taken into account : Mixing, refining, cumulation... The new rules should prove secure for the long term and will little by little serve as a model for new trade arrangements 6

Thank you for your attention and support 7