and where the situations referred to above give rise, or are likely to give rise, to major difficulties for the exporting Party, that Party may take appropriate measures under the conditions and in accordance with the procedures laid down in paragraph 2.
2. The difficulties arising from the situations referred to in paragraph 1 shall be submitted for examination to the Association Committee. The Association Committee may take any decision needed to put an end to the difficulties. If it has not taken such a decision within thirty days of the matter being referred to it, the exporting Party may apply appropriate measures on the exportation of the product concerned. The measures shall be non-discriminatory and shall be eliminated when conditions no longer justify their maintenance.
Article 27.
Nothing in this Agreement shall preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; of the protection of health and life of humans, animals or plants; of the protection of national treasures of artistic, historic or archaeological value; of the protection of intellectual industrial and commercial property; of rules relating to gold and silver and conservation of exhaustible natural resources. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between the Parties.
Article 28.
The concept of "originating products" for the application of the provisions of the present Title and the methods of administrative cooperation relating thereto are laid down in Protocol 4.
Article 29.
The Combined Nomenclature of goods shall be applied to the classification of goods for imports into the Community. The Lebanese customs tariff shall be applied to the classification of goods for imports into Lebanon.
Title III. RIGHT OF ESTABLISHMENT AND SUPPLY OF SERVICES
Article 30.
1. Treatment granted by either Party to the other with respect to the right of establishment and the supply of services shall be based on each Party's commitments and other obligations under the General Agreement on Trade in Services (GATS). This provision shall take effect from the date of the final accession of Lebanon to the WTO.
2. Lebanon undertakes to provide a schedule of specific commitments on services, prepared in accordance with Article XX of the GATS, to the European Community and their Member States as soon as it is finalised.
3. The Parties undertake to consider development of the above provisions with a view to the establishment of an "economic integration agreement" as defined in Article V of the GATS.
4. The objective provided for in paragraph 3 shall be subject to a first examination by the Association Council one year after the entry into force of this Agreement.
5. The Parties shall not, between the date of entry into force of this Agreement and Lebanon's accession to the WTO, take any measures or actions which render the conditions for the supply of services by Community or Lebanese service suppliers more discriminatory than those existing on the date of entry into force of this Agreement.
6. For the purposes of this Title:
(a) "service suppliers" of a Party means any juridical or natural person that seeks to provide or provides a service;
(b) a "juridical person" means a company or a subsidiary, set up in accordance with the laws either of a Member State of the Community or of Lebanon and having its registered office, central administration or principal place of business in the territory either of the Community or of Lebanon. Should the juridical person have only its registered office or central administration in the territory either of the Community or of Lebanon, it shall not be considered as either a Community or a Lebanese juridical person, unless its operations possess a real and continuous link with the economy either of the Community or Lebanon;
(c) "subsidiary" means a juridical person which is effectively controlled by another juridical person;
(d) "natural person" means a person who is a national either of a Member State of the Community or of Lebanon according to their respective national legislations.
Title IV. PAYMENTS, CAPITAL, COMPETITION AD OTHER ECONOMIC PROVISIONS
Chapter 1. Current Payments and Movement of Capital
Article 31.
Within the framework of the provisions of this Agreement, and subject to the provisions of Articles 33 and 34, there shall be no restrictions between the Community of the one part, and Lebanon of the other part, on the movement of capital and no discrimination based on the nationality or on the place of residence of their nationals or on the place where such capital is invested.
Article 32.
Current payments connected with the movement of goods, persons, services or capital within the framework of this Agreement shall be free of all restrictions.
Article 33.
1. Subject to other provisions in this Agreement and other international obligations of the Community and Lebanon, the provisions of Articles 31 and 32 shall be without prejudice to the application of any restriction which exists between them on the date of entry into force of this Agreement, in respect of the movement of capital between them involving direct investment, including in real estate, establishment, the provision of financial services or the admission of securities to capital markets.
2. However, the transfer abroad of investments made in Lebanon by Community residents or in the Community by Lebanese residents and of any profit stemming therefrom shall not be affected.
Article 34.
Where one or several Member States of the Community or Lebanon face or risk facing serious difficulties concerning balance of payments, the Community or Lebanon respectively may, in conformity with the conditions laid down within the framework of the GATT and Articles VIII and XIV of the Statutes of the International Monetary Fund, take restrictive measures with regard to current payments if such measures are strictly necessary. The Community or Lebanon, as appropriate, shall inform the other Party immediately thereof and shall provide as soon as possible a timetable for the removal of such measures.
Chapter 2. Competition and other Economic Matters
Article 35.
1. The following are incompatible with the proper functioning of this Agreement, insofar as they may affect trade between the Community and Lebanon:
(a) all agreements between undertakings, decisions by associations of undertakings and concerted practices between undertakings which have as their object or effect the prevention, restriction or distortion of competition, as defined by their respective legislation;
(b) abuse by one or more undertakings of a dominant position in the territories of the Community or Lebanon as a whole or in a substantial part thereof, as defined by their respective legislation.
2. The Parties will enforce their respective competition legislation and shall exchange information taking into account the limitations imposed by the requirements of confidentiality. The necessary rules for cooperation in order to implement paragraph 1 shall be adopted by the Association Committee within five years of entry into force of this Agreement.
3. If the Community or Lebanon considers that a particular practice is incompatible with the terms of paragraph 1 of this Article, and if such practice causes or threatens to cause serious prejudice to the other Party, it may take appropriate measures after consultation within the Association Committee or after thirty working days following referral for such consultation.
Article 36.
The Member States and Lebanon shall progressively adjust, without prejudice to their commitments respectively taken or to be taken under the GATT, any State monopolies of a commercial character, so as to ensure that, by the end of the fifth year following the entry into force of this Agreement, no discrimination regarding the conditions under which goods are procured and marketed exists between nationals of the Member States and of Lebanon. The Association Committee will be informed about the measures adopted to implement this objective.
Article 37.
With regard to public enterprises and enterprises to which special or exclusive rights have been granted, the Association Council shall ensure that as from the fifth year following the date of entry into force of this Agreement there is neither enacted nor maintained any measure distorting trade between the Community and Lebanon to an extent contrary to the Parties' interests. This provision should not obstruct the performance in law or in fact of the particular tasks assigned to these enterprises.
Article 38.
1. Pursuant to the provisions of this Article and of Annex 2, the Parties shall ensure adequate and effective protection of intellectual, industrial and commercial property rights in conformity with the highest international standards, including effective means of enforcing such rights.
2. The implementation of this Article and of Annex 2 shall be regularly reviewed by the Parties. If problems in the area of intellectual property protection affecting trading conditions occur, urgent consultations shall be undertaken, at the request of either Party, with a view to reaching mutually satisfactory solutions.
Article 39.
1. The Parties shall take as their aim a reciprocal and gradual liberalisation of public procurement contracts.
2. The Association Council shall take the steps necessary to implement paragraph 1.
Title V. ECONOMIC AND SECTOR COOPERATION
Article 40. Objectives
1. The two Parties shall together establish the strategies and procedures needed to achieve cooperation in the fields covered by this Title.
2. The Parties undertake to intensify economic cooperation in their mutual interest and in the spirit of partnership which is at the root of this Agreement.
3. The aim of economic cooperation shall be to support Lebanon's own efforts to achieve sustainable economic and social development.
Article 41. Scope
1. Cooperation shall be targeted first and foremost at areas of activity suffering the effects of internal constraints and difficulties or affected by the process of liberalising Lebanon's economy as a whole, and more particularly by the liberalisation of trade between Lebanon and the Community.
2. Similarly, cooperation shall focus on areas likely to bring the economies of the Community and Lebanon closer together, particularly those which will generate growth and employment.
3. Preservation of the environment and ecological balances shall constitute a central component of the various fields of economic cooperation.
4. The Parties may agree to extend the economic cooperation to other sectors not covered by the provisions of this Title.
Article 42. Methods and Modalities
Economic cooperation shall be implemented in particular by:
(a) a regular economic dialogue between the Parties, which covers all areas of macroeconomic policy;
(b) regular exchange of information and ideas in every sector of cooperation including meetings of officials and experts;
(c) transfer of advice, expertise and training;
(d) implementation of joint actions such as seminars and workshops;
(e) technical, administrative and regulatory assistance;
(f) the dissemination of information on cooperation.
Article 43. Education and Training
Cooperation aims at:
(a) defining the means to appreciably improve the situation in the field of education and training, particularly in vocational training;
(b) encouraging the setting up of strong links between agencies specialised in joint actions, and the exchange of experiences and know-how, essentially, the exchange of youth, exchanges between universities and other educational institutions, so as to bring cultures closer together;
(c) particularly encouraging access of the female population to education, including technical and higher education, and vocational training.
Article 44. Scientific, Technical and Technological Cooperation
The aim of cooperation shall be to:
(a) encourage the establishment of permanent links between the Parties' scientific communities, notably by means of:
- providing Lebanon with access to Community research and technological development programmes in accordance with Community rules governing non-Community countries' involvement in such programmes,
- Lebanese participation in networks of decentralised cooperation,
- promoting synergy between training and research;
(b) improve Lebanon's research capabilities; and its technological development;
(c) stimulate technological innovation and the transfer of new technology and dissemination of know-how;
(d) study the ways Lebanon can participate in European framework programmes for research.
Article 45.
Environment
1. The Parties shall encourage cooperation in preventing deterioration of the environment, controlling pollution and ensuring the rational use of natural resources, with a view to ensuring sustainable development.
2. Cooperation shall be centred upon:
(a) water quality in the Mediterranean, and control and prevention of marine pollution;
(b) waste management, particularly that of toxic waste;
(c) salinisation;
(d) environmental management of sensitive coastal areas;
(e) environmental education and awareness;
(f) the use of advanced instruments for environmental management and monitoring, and in particular the use of the environment information system and studies on environmental impact;
(g) the effect of industrial development on the environment in general and on the safety of industrial plant in particular;
(h) the effect of agriculture on soil quality and water quality;
(i) soil preservation and conservation;
(j) rational management of water resources;
(k) joint research and monitoring activities as well as programmes and projects.
Article 46. Industrial Cooperation
The aim of cooperation shall be to:
(a) encourage cooperation between the Parties' economic operators, including cooperation in the context of access for Lebanon to Community business networks;
(b) support the effort to modernise and restructure Lebanon's public and private sector industry (including the agri-food industry);
(c) foster an environment which favours private initiative, with the aim of stimulating and diversifying output for the domestic and export markets;
(d) enhance Lebanon's human resources and industrial potential through better use of policy in the fields of innovation and research and technological development;
(e) facilitate access to capital markets to finance productive investment;
(f) encourage the development of SMEs, particularly by:
- promoting contacts between enterprises, partly by using Community networks and instruments for the promotion of industrial cooperation and partnership,
- facilitating credit access for financing investment,
- making information and support services available,
- enhance human resources to encourage innovation, and setting up projects and economic activities.
Article 47. Promotion and Protection of Investment
1. Cooperation shall aim at increasing the flow of capital, expertise and technology to Lebanon through, inter alia:
(a) appropriate means of identifying investment opportunities and information channels on investment regulations;
(b) providing information on European investment regimes (technical assistance, direct financial support, fiscal incentives, investment insurance, etc.) related to outward investment and enhancing the possibility of Lebanon to benefit from them;
(c) examining the creation of joint ventures (especially for small and medium-sized enterprises), and when appropriate the conclusion of agreements between the Member States and Lebanon;
(d) establishing mechanisms for encouraging and promoting investments;
(e) the development of a legal framework conducive to investment between the two Parties, through the conclusion by Lebanon and the Member States of investment protection agreements, where appropriate, and agreements preventing double taxation.
2. Cooperation may extend to the planning and implementation of projects demonstrating the effective acquisition and use of basic technologies, the use of standards, the development of human resources and the creation of jobs locally.
Article 48. Cooperation In Standardisation and Conformity Assessment
The Parties shall cooperate in:
(a) reducing divergences in standardisation, metrology, quality control and conformity assessment;
(b) developing the updating of Lebanese laboratories;
(c) negotiating mutual recognition agreements as soon as the conditions for them are met;
(d) strengthening the Lebanese institutions responsible for standardisation, quality, and intellectual, industrial and commercial property.
Article 49. Approximation of Legislation
The Parties shall use their best endeavours to approximate their respective laws in order to facilitate the implementation of this Agreement.
Article 50. Financial Services
The aim of cooperation shall be to achieve closer common rules and standards in areas including the following:
(a) developing the financial markets in Lebanon;
(b) improving accounting, auditing, supervision and regulation of financial services and financial monitoring in Lebanon.
Article 51. Agriculture and Fisheries
The aims of cooperation shall be:
(a) to support policies aiming to diversify production;
(b) to reduce food dependency;
(c) to promote a form of agriculture which pays due regard to the environment;
(d) to establish closer relations between enterprises, groupings and professional organisations of the two Parties;
(e) to provide assistance and technical training; support for agronomic research, advisory services, agricultural education and technical training of staff in the agricultural sector;
(f) to harmonise phytosanitary and veterinary standards;
(g) to support integrated rural development, including improvement of basic services and development of ancillary economic activities, particularly in the regions affected by the eradication of illicit crops;
(h) cooperation between rural areas, exchange of experience and know-how on rural development;
(i) development of sea fishing and aquaculture;
(j) development of packaging, storage and marketing techniques; and the improvement of distribution channels;
(k) to develop agricultural water resources;
(l) to develop the forestry sector, especially in the fields of reafforestation, forest fire prevention, forest pasture and combating desertification;
(m) to develop agricultural mechanisation and promotion of agricultural service cooperatives;
(n) to strengthen the agricultural credit system.
Article 52. Transport
The aim of cooperation shall be to:
(a) restructure and modernise road, rail, port and airport infrastructure linked to the main trans-European lines of communication of common interest;
(b) establish and enforce operating and safety standards comparable to those prevailing in the Community;
(c) upgrade technical equipment to Community standards for multimodal transport, container traffic and transshipment;
(d) improve road, maritime and multimodal transit and the management of ports, airports, sea and air traffic control, railways and navigation aids;
(e) reorganise and restructure of the mass transport sector including public transport.