Title
FREE TRADE AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF SERBIA AND THE GOVERNMENT OF THE ARAB REPUBLIC OF EGYPT
Preamble
PREAMBLE
The Republic of Serbia and the Arab Republic of Egypt (hereinafter referred to as "the Parties" (or "Serbia" and "Egypt" where appropriate),
DESIROUS to develop and strengthen friendly relations, especially in the fields of economic cooperation and trade, with an aim to contribute to the progress of economic cooperation and to increase the scope of mutual trade exchange,
CONFIRMING their intention to participate actively in the process of economic integration in Europe and in the Mediterranean basin expressing their preparedness to cooperate in seeking ways and means to strengthen this process,
TAKING INTO CONSIDERATION the "Stabilisation and Association Agreement between the European Communities and their Member States and the Republic of Serbia" and the "Euro- Mediterranean Agreement establishing an Association between the European Communities and their Member States and the Arab Republic of Egypt",
CONSIDERING that Serbia and Egypt are Contracting Parties to the Regional Convention on pan-Euro-Mediterranean preferential rules of origin (the PEM Convention), which lays down provisions on the origin of goods traded under the relevant Agreements concluded in the pan- Euro-Mediterranean zone.
HAVING tegard to the experience gained from the cooperation developed between the Parties as well as between them and their main trading partners,
DECLARING their readiness to adopt measures with a view to promoting harmonious development of their trade as well as to expanding and diversifying their mutual co-operation in the fields of joint interest, including fields not covered by the Agreement, thus creating a framework and supportive environment based on equality, non-discrimination, and balance of rights and obligations,
REFERRING to the mutual interest in the continual reinforcement of the multilateral trading system and considering that the provisions and instruments of the General Agreement on Tariffs and Trade 1994 (hereinafter referred to as "GATT 1994") and the World Trade Organization (hereinafter referred to as "WTO") constitute a basis for their foreign trade policy,
RESOLVED to lay down for this purpose provisions aimed at the progressive abolition of the obstacles to mutual trade in accordance with the provisions of these international agreements, in particular those concerning the establishment of free trade area,
RESOLVED to contribute to the strengthening of the multilateral trading system and to develop their relations towards free trade in compliance with the WTO rules,
CONSIDERING that no provision of the Agreement may be interpreted as exempting the Parties from their obligations under other international agreements, especially the GATT 1994 and the WTO,
CONVINCED that the Free Trade Agreement (hereinafter referred to as "the Agreement") will create a new climate for economic relations between them and, above all, for the development of trade, technical fields and investment, factors crucial to economic restructuring and modernization;
HAVE DECIDED, in pursuance of these objectives, to conclude the Agreement.
Body
Chapter I. INITIAL PROVISIONS
Article 1. Objectives
1. The Parties shall establish a free trade area in accordance with the provisions of the Agreement and in conformity with Article XXIV of the GATT 1994 with a view to spurring prosperity and economic development in their territories.
2. The objectives of the Agreement are:
a) to increase and enhance the economic cooperation between the Parties and to raise the living standard of the population of the two countries;
b) to gradually eliminate difficulties and restrictions on trade in goods;
c) to promote, through the expansion of reciprocal trade, the harmonious development of the economic relations between the Parties;
d) to provide fair conditions of competition in trade between the Parties;
e) to contribute by the removal of barriers to trade, to the harmonious development and expansion of world trade;
f) to create conditions for further encouragement of investments, particularly for the development of joint investments in both countries;
g) to promote trade and cooperation between the Parties in third-country markets.
Article 2. Basic Duties
1. In trade between the Parties covered by the Agreement, the Parties shall apply their respective Customs Tariffs on the classification of goods for imports into them.
2. For the purpose of the Agreement, customs duties or charges having equivalent effect to customs duties include any duties or charges of any kind imposed in connection with the importation or exportation of the goods, including any form of surtax or surcharge in connection with such importation or exportation, but do not include any:
a) charges equivalent to an internal tax imposed consistently with the provisions of paragraph 2 of Article II of the GATT 1994;
b) anti-dumping or countervailing measures; c) fees or charges commensurate with the costs of services rendered.
3. For each product, the basic duty to which successive reductions are set out in the Agreement shall be the actually applied erga omnes duty that was in force in the Parties as of 1° March 2023.
4. If, after the entry into force of the Agreement, any tariff reduction is applied on an erga omnes basis, in particular, tariff reductions resulting:
a) from the tariff negotiations in the WTO or; b) in the event of the accession of Serbia to the WTO or; c) from subsequent reductions after the accession of Serbia to the WTO,
such reduced duties shall replace the basic duty referred to in paragraph 3 of this Article as from the date when such reductions are applied.
5. The reduced duties to be applied by the Parties calculated, as set out in the Agreement, shall be rounded to the one decimal number using common arithmetical principles.
6. Serbia and Egypt shall exchange with each other their respective basic duties and any changes thereof.
Chapter III. INDUSTRIAL PRODUCTS
Article 3. Scope
The provisions of this Chapter shall apply to products originating in the Parties falling within Chapters 25 to 97 of Harmonized Commodity Description and Coding System with the exception of the products listed in Annex 1, paragraph 1 (ii) of the WTO Agreement on Agriculture.
Article 4. Customs Duties on Imports and Charges Having Equivalent Effect
1. No new customs duties on imports or charges having equivalent effect shall be introduced in trade between the Parties from the date of entry into force of the Agreement.
2. Customs duties or charges having equivalent effect on imports into Egypt of goods originating in Serbia listed in Annex 1 with category A shall be abolished upon the entry into force of the Agreement.
3. Customs duties or charges having equivalent effect on imports into Egypt of goods originating in Serbia, which are listed in Annex 1 with categories B and C shall be progressively abolished in accordance with the timetable laid down thereof.
4. Customs duties or charges having equivalent effect on imports into Egypt of goods originating in Serbia, which are listed in Annex 1 with category D (Sensitive products), shall be excluded from any reductions.
5. Customs duties or charges having equivalent effect on imports into Serbia of goods originating in Egypt listed in Annex 2 with category A shall be abolished upon the entry into force of the Agreement.
6. Customs duties or charges having equivalent effect on imports into Serbia of goods originating in Egypt, which are listed in Annex 2 with categories B and C shall be progressively abolished in accordance with the timetable laid down thereof.
7. Customs duties or charges having equivalent effect on imports into Serbia of goods originating in Egypt, which are listed in Annex 2 with category D (Sensitive products), shall be excluded from any reductions.
Article 5. Fiscal Duties
The provisions concerning the abolition of customs duties on imports shall also apply to customs duties of a fiscal nature.
Article 6. Customs Duties on Exports and Charges Having Equivalent Effect and Re-export
1. From the date of the entry into force of the Agreement, no new customs duties on exports or charges having equivalent effect shall be introduced in trade between the Parties.
2. All customs duties on exports or charges having equivalent effect shall be abolished between the Parties upon entry into force of the Agreement.
3. Where compliance with the provisions of the Article leads to re-export towards a third country against which the exporting Party to the Agreement maintains for the product concerned export duties or measures or charges having equivalent effect and where the situations referred to above give rise or are likely to give rise to major difficulties for the exporting Party, Party may take appropriate measures under the conditions and per the procedures laid down in Article 24 of the Agreement. The measures shall be non-discriminatory and shall be eliminated when conditions no longer justify their maintenance.
Article 7. Quantitative Restrictions on Imports and Measures Having Equivalent Effects
1. From the date of the entry into force of the Agreement, no new quantitative restrictions on imports or measures having equivalent effect shall be introduced in trade between the Parties.
2. All quantitative restrictions on imports or measures having equivalent effect shall be abolished between the Parties upon the date of entry into force of the Agreement.
3. Notwithstanding the foregoing, if otherwise is not provided for in the Agreement the Parties may apply prohibitions, quantitative restrictions or other measures having equivalent effect on imports of goods in respect of mutual trade in consistency with Article XI of the GATT 1994 and in accordance with Article XIII of the GATT 1994.
Article 8. Quantitative Restrictions on Exports and Measures Having Equivalent Effects
1. From the date of the entry into force of the Agreement, no new quantitative restrictions on exports or measures having equivalent effect shall be introduced in trade between the Parties.
2. All quantitative restrictions on exports or measures having equivalent effect shall be abolished between the Parties upon the date of entry into force of the Agreement.
3. Notwithstanding the foregoing, if otherwise is not provided for in the Agreement the Parties may apply prohibitions, quantitative restrictions or other measures having equivalent effect on exports of goods in respect of mutual trade in consistency with Article XI of the GATT 1994 and in accordance with Article XIII of the GATT 1994.
Article 9. Technical Barriers to Trade
1. The rights and obligations of the Parties relating to preparing, adopting or applying of technical regulations, standards, and procedures for assessment conformity and related measures shall be governed by the WTO Agreement on Technical Barriers to Trade.
2. Each Party, upon request from the other Party, shall provide information on particular cases of technical regulations, standards, conformity assessment procedures and applied measures.
3. The Parties shall endeavor to eliminate obstacles to international trade with respect to technical regulations. To this end, the Parties will enter where appropriate into negotiations for the conclusion of the agreements for mutual recognition in the field of conformity assessment, in the spirit of the recommendations of the WTO Agreement on Technical Barriers to Trade.
Chapter III. AGRICULTURAL, PROCESSED AGRICULTURAL AND FISH AND FISHERY PRODUCTS
Article 10. Scope
1. The provisions of this Chapter shall apply to basic agricultural, processed agricultural and fish and fishery products originating in the territory of each Party.
2. The term "agricultural, processed agricultural and fish and fishery product" refers to the products listed in Chapters 01 to 24 of the Harmonized Commodity Description and Coding System and the products listed in Annex 1, paragraph 1 (ii) of the WTO Agreement on Agriculture.
Article 11. Exchange of Concessions
1. The Parties to the Agreement shall mutually allocate concessions set forth in Annexes 3 and 4 in accordance with the provisions of this Chapter.
2. Customs duties or other charges having equivalent effect on agricultural, processed agricultural and fish and fishery products originating in Serbia on importation into Egypt shall be subject to the arrangements set out in Annex 3.
3. Customs duties or other charges having equivalent effect on agricultural, processed agricultural and fish and fishery products originating in Egypt on importation into Serbia shall be subject to the arrangements set out in Annex 4.
Article 12. Sanitary and Phytosanitary Measures
The Parties shall not apply their regulations in sanitary and phytosanitary matters as an arbitrary or unjustifiable discrimination or a disguised restriction of trade between them. The Parties shall apply these measures within the spirit of the provisions of the GATT 1994 and the WTO Agreement on Application of Sanitary and Phytosanitary Measures.
Chapter IV. RULES OF ORIGIN
Article 13. Applicable Rules of Origin
1. For the purpose of implementing the Agreement, the Parties agree to apply the Regional Convention on pan-Euro-Mediterranean preferential rules of origin "the Convention", as last amended and published in the Official Journal of the European Union and in official publications of the Parties, which is incorporated into and made part of the Agreement, mutatis mutandis.
2. All references to the "relevant agreementâ in the Convention shall be construed so as to mean the Agreement.
Article 14. Withdrawal from the Convention
1. Should either Serbia or Egypt give notice in writing to the depositary of the Convention of their intention to withdraw from the Convention according to Article 9 thereof, Serbia and Egypt shall immediately enter into negotiations on rules of origin for the purpose of implementing the Agreement.
2. Until the entry into force of such newly negotiated rules of origin, the rules of origin contained in the Convention, applicable at the moment of withdrawal, shall continue to apply to the Agreement. However, from the moment of withdrawal, the rules of origin contained in the Convention shall be construed so as to allow bilateral cumulation between Serbia and Egypt only.
Article 15. Electronically Issued Movement Certificates
The Parties agree that Recommendation of the Joint Committee of the Regional Convention on pan- Euro-Mediterranean preferential rules of origin as regards the use of movement certificates issued electronically, adopted on 7" of December 2023 in Brussels, shall apply.
Chapter V. SERVICES AND INVESTMENTS
Article 16. Trade In Services
The Parties of the Agreement recognize the growing importance of services. In their efforts to gradually develop and broaden their cooperation, they will cooperate with the aim of enhancing trade in services, taking into account relevant provisions of the General Agreement on Trade in Services (GATS).
Article 17. Investment Promotion
1. The Parties reaffirmed the importance of promoting investments that contribute to attaining sustainable development with the aim to foster public welfare, stimulating technology transfer, job creation, human resources development and poverty reduction.
2. The Parties may agree to cooperate through the following in order to encourage mutual investment flows and enhance business climate, in conformity with the national laws, regulations and policies of each Party:
a) exchanging investment opportunities, as well as investment related laws and regulations so as to increase awareness of their business environments;
b) encouraging and supporting investment promotion activities such as investment conferences, forums, fairs, exhibitions and investment promotion missions;
c) exchanging experiences on investment related activities including investment promotion, services provided to investors, policy advocacy, avoidance and settlement of investment disputes;
d) developing mechanisms for promoting joint ventures between the Parties and between their investors, supporting SMEs and investments in the regions most in need of development and encouraging green economy investments.
Chapter VI. COMMON PROVISIONS
Article 18. Internal Taxation
The rights and the obligations of the Parties in respect of internal taxation shall be governed by article Il of GATT 1994, which is hereby incorporated into and made part of the Agreement.
Article 19. Customs Unions, Free Trade Areas and Cross-Border Arrangements
1. The Agreement shall not prevent the maintenance or establishment of customs unions, free trade areas or arrangements for cross-border trade of the Parties with third countries to the extent that these do not negatively affect the trade regime and, in particular, the provisions concerning rules of origin provided for by the Agreement.
2. Consultations between the Parties shall take place within the Joint Committee concerning agreements establishing customs unions or free trade areas and, where appropriate, on other major issues related to their respective trade policies with third countries. Such consultations shall take place so as to ensure that account is taken of the mutual interests of the Parties stated in the Agreement.
Article 20. Dumping and Subsidies
1. If one of the Parties finds that dumping and/or subsidization is taking subsidized with the other Party, that Party may take appropriate measures against this practice in accordance with the WTO Agreement on Implementation of Article VI of the GATT 1994 and the WTO Agreement on Subsidies and Countervailing Measures and its own related internal legislation.
2. None of the provisions in the Agreement prevents either Party from taking trade defense action in accordance with paragraph 1 of this Article.
Article 21. General Safeguards
Where any product is being imported into either of the Parties in such increased quantities, each Party retains its rights and obligations under Article XIX of GATT 1994 and the WTO Agreement on Safeguard Measures. The Agreement does not confer any additional rights or obligations on the Parties with regard to safeguard measures.
Article 22. Bilateral Safeguard Measures
1. Where, as a result of the reduction or elimination of a customs duty under the Agreement, any product originating in a Party is being imported into the territory of another Party in such increased quantities, in absolute terms or relative to domestic production, and under such conditions as to constitute a substantial cause of injury or threat thereof to the domestic industry of like or directly competitive products in the territory of the importing Party, the importing Party may take bilateral safeguard measures to the minimum extent necessary to remedy or prevent the injury, subject to the provisions of paragraphs 2 to 10.
2. Bilateral safeguard measures shall only be taken upon clear evidence that increased imports have caused or are threatening to cause serious injury pursuant to an investigation in accordance with the procedures laid down in the WTO Agreement on Safeguards.
3. The Party intending to take a bilateral safeguard measure under this article shall immediately, and in any case before initiating an investigation or taking a measure, make notification to the other Party and the Joint Committee. The notification shall contain all pertinent information, which shall include evidence of serious injury or threat thereof caused by increased imports, a precise description of the product involved and the proposed measure, as well as the proposed date of introduction, expected duration and timetable for the progressive removal of the measure.
4. If the conditions set out in paragraph 1 are met, the importing Party may take measures consisting in:
(a) suspending the further reduction of any rate of duty provided for under the Agreement for the product; or
(b) increasing the rate of customs duty for the product to a level not to exceed the lesser of: (i) the MEN rate of duty applied at the time the action is taken; or
(ii) the MEN rate of duty applied on the day immediately preceding the date of the entry into force of the Agreement.
5. Bilateral safeguard measures shall be taken for a period not exceeding two years. In very exceptional circumstances, after review by the Joint Committee, measures may be taken up to a total maximum period of three years. No measure shall be applied to the import of a product which has previously been subject to such a measure for a period of time equal to that during which such measure has been previously applied.
6. The Joint Committee shall, within 30 days from the date of notification referred to in paragraph 3, examine the information provided in order to facilitate a mutually acceptable resolution of the matter. In the absence of such resolution, the importing Party may adopt a measure pursuant to paragraph 4 to remedy the problem. In the selection of the bilateral safeguard measure, priority must be given to the measure which least disturbs the functioning of the Agreement. The bilateral safeguard measure shall be immediately notified to the other Parties and the Joint Committee and shall be the subject of periodic consultations in the Joint Committee, particularly with a view to establishing a timetable for their abolition as soon as circumstances permit.
7. Upon the termination of the measure, the rate of customs duty shall be the rate which would have been in effect but for the measure.
8. In critical circumstances, where delay would cause damage which would be difficult to repair, a Party may take a provisional bilateral safeguard measure pursuant to a preliminary determination that there is clear evidence that increased imports constitute a substantial cause of serious injury, or threat thereof, to the domestic industry. The Party intending to take such a measure shall immediately notify the other Party and the Joint Committee thereof. Consultation shall be initiated immediately after the provisional measures are taken. And within 30 days of the date of the notification, the procedures set out in paragraphs 2 to 5 shall be initiated.
9. Any provisional measure shall be terminated within 200 days at the latest. The period of application of any such provisional measure shall be counted as part of the duration of the measure set out in paragraph 5 and any extension thereof. Any tariff increases shall be promptly refunded if the investigation described in paragraph 2 does not result in a finding that the conditions of paragraph 1 are met.
10. Five years after the date of entry into force of the Agreement, the Parties shall review in the Joint Committee whether there is a need to maintain the possibility to take bilateral safeguard measures between them. If the Parties decide, after the first review, to maintain such possibility, they shall thereafter conduct biennial reviews of this matter in the Joint Committee.
Article 23. State Trading Enterprises
1. The Parties shall progressively adjust any state monopoly of a commercial character so as to ensure that by the end of the third year following the entry into force of the Agreement, no discrimination regarding the conditions under which goods are procured and marketed will exist between nationals of the Parties in accordance with the provisions of Article XVII of GATT 1994,
2. The Joint Committee shall be informed about the measures adopted to implement this objective.
Article 24. Notifications and Consultations Procedures for the Application of Measures
1. The Parties shall take any general or specific measures required to fulfill their obligations under the Agreement, and they can see to it that the objectives set out in the Agreement are attained.
2. If either Party considers that the other Party has failed to fulfill an obligation under the Agreement, the Party may request consultations with the other Party. A copy of the request for consultations shall be submitted to the Joint Committee.
3. The concerned Party shall provide the Joint Committee with all relevant information required to enable an examination of the matter. Consultations between the Parties shall take place without delay in the Joint Committee with a view to finding a commonly acceptable solution.
4. If the consultations fail to settle the dispute within 30 days after the date of receipt of the request for consultations, which may be extended by a further period of 30 days through mutual consent, the Party may request the Joint Committee to settle the dispute within 30 days through extraordinary meeting of the Joint Committee.
Article 25. Payments
1. The Parties undertake to authorize, in freely convertible currency, in accordance with the provisions of Article VII of the Articles of the Agreement of the International Monetary Fund, any payments and transfers on the current account of the balance of payments between Serbia and Egypt.
2. Payments in freely convertible currencies relating to commercial transactions within the framework of the Agreement between the Parties and the transfer of such payments to the territory of the Party where the creditor resides shall be free from any restrictions.
3. The Parties shall refrain from the exchange or administrative restrictions other than existing in the current legislation of the Parties on the grant repayment or acceptance of short and medium-term credits related to commercial transactions in which a resident of a Party participates.
4. Notwithstanding the provisions of paragraph 3, any measures concerning current payments connected with the movement of goods shall be in conformity with the conditions laid down under Article VII of the Articles of the Agreement of the International Monetary Fund.
Article 26. Rules of Competition Concerning Undertakings and State Aid
1. The following are incompatible with the proper implementation of the Agreement, in so far as they may affect trade between the Parties:
a) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings that have as their object or effect the prevention, restriction or distortion of competition;
b) abuse by one or more undertakings of a dominant position in the territories of the Parties as a whole or in a substantial part thereof;
c) any state aid, which distorts or threatens to distort competition by favoring certain undertakings or the production of certain goods.
2. Each Party shall ensure transparency in the area of state aid. Upon request by one Party, the other Party shall provide information on particular individual cases of state aid.
3. If any Party considers that a particular practice is incompatible with the terms of the first paragraph of this Article, and:
a) is not adequately dealt with under the implementing rules referred to in paragraph 4 of this Article; or
b) in the absence of such rules, and if such practice causes or threatens to cause serious prejudice to the interest of the other Party or material injury to its domestic industry, including its services industry;
it may take appropriate measures after consultation within the Joint Committee or after thirty working days following referral for such consultation.
4. In the case of practices incompatible with paragraph 1. c) of this Article, such appropriate measures may, where the WTO/GATT 1994 applies thereto, only be adopted in conformity with the procedures and under the conditions laid down by the WTO/GATT 1994 and any other relevant instrument negotiated under its auspices which are applicable between the Parties.
5. In case of a competition investigation conducted by one Party against the undertakings based in the territory of the other Party, if the investigating Party requests for cooperation in the communication of the official documents relevant to the investigation from the other Party, the requested Party will do its best to ensure the requested communication to be served in a timely manner through its competent governmental institutions.
6. Notwithstanding any provisions to the contrary adopted in conformity with this Article, the Parties shall exchange information taking into account the limitations imposed by the requirements of professional and business secrecy.