Chapter 1. Capital Movements and Payments
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 Israel 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.
Subject to other provisions in this Agreement and other international obligations of the Community and Israel, 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.
However, the transfer abroad of investments made in Israel by Community residents or in the Community by Israeli residents and of any profit stemming therefrom shall not be affected.
Article 34.
Where, in exceptional circumstances, movements of capital between the Community and Israel cause, or threaten to cause, serious difficulties for the operation of exchange rate policy or monetary policy in the Community or Israel, the Community or Israel respectively may, in conformity within the conditions laid down within the framework of the GATS and with Articles VIII and XIV of the Articles of Agreement of the International Monetary Fund, take safeguard measures with regard to movements of capital between the Community and Israel for a period not exceeding six months if such measures are strictly necessary.
Chapter 2. Public Procurement
Article 35.
The Parties shall take measures with a view to a mutual opening of their respective government procurement markets and the procurement markets of undertakings operating in the utilities sectors for purchase of goods, works and services beyond the scope of what has been mutually and reciprocally covered under the Government Procurement Agreement concluded in the framework of the WTO.
Chapter 3. Competition
Article 36.
1. The following are incompatible with the proper functioning of the Agreement, in so far as they may affect trade between the Community and Israel:
(i) 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;
(ii) abuse by one or more undertakings of a dominant position in the territories of the Community or Israel as a whole or in a substantial part thereof;
(iii) any public aid which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods.
2. The Association Council shall, within three years of the entry into force of the Agreement, adopt by decision the necessary rules for the implementation of paragraph 1.
Until these rules are adopted, the provisions of the Agreement on interpretation and application of Articles VI, XVI and XXIII of the GATT shall be applied as the rules for the implementation of paragraph 1(iii).
3. Each Party shall ensure transparency in the area of public aid, inter alia, by reporting annually to the other Party on the total amount and the distribution of the aid given and by providing, upon request, information on aid schemes. Upon request by one Party, the other Party shall provide information on particular individual cases of public aid.
4. With regard to agricultural products referred to in Title II, Chapter 3, paragraph 1(iii) does not apply.
5. If the Community or Israel considers that a particular practice is incompatible with the terms of paragraph 1 and: -is not adequately dealt with under the implementing rules referred to in paragraph 2, or -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 Association Committee or after 30 working days following referral for such consultation. With reference to practices incompatible with paragraph 1(iii), such appropriate measures, when the GATT is applicable to them, may only be adopted in accordance with the procedures and under the conditions laid down by the GATT or by any other relevant instrument negotiated under its auspices and applicable to the Parties.
6. Notwithstanding any provisions to the contrary adopted in accordance with paragraph 2, the Parties shall exchange information taking into account the limitations imposed by the requirements of professional and business secrecy.
Article 37.
1. The Member States and Israel shall progressively adjust 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 Israel.
2. The Association Committee shall be informed about the measures adopted to implement this objective.
Article 38.
With regard to public undertakings and undertakings 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 Israel 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 those undertakings.
Chapter 4. Intellectual, Industrial and Commercial Property
Article Article
1. Pursuant to the provisions of this Article and of Annex VII, the Parties shall grant and ensure adequate and effective protection of intellectual, industrial and commercial property rights in accordance with the highest international standards, including effective means of enforcing such rights.
2. The implementation of this Article and of Annex VII shall be regularly reviewed by the Parties. If problems in the area of intellectual, industrial and commercial property affecting trading conditions were to occur, urgent consultation within the Association Committee shall be undertaken, at the request of either Party, with a view to reaching mutually satisfactory solutions.
Title V. SCIENTIFIC AND TECHNOLOGICAL COOPERATION
Article 40.
The Parties undertake to intensify scientific and technological cooperation. Detailed arrangements for the implementation of this objective shall be set out in separate agreements concluded for this purpose.
Title VI. ECONOMIC COOPERATION
Article 41. Objectives
The Community and Israel undertake to promote economic cooperation to their mutual benefit and on the basis of reciprocity in accordance with the overall objectives of the Agreement.
Article 42. Scope
1. Cooperation shall focus principally on sectors relevant to the rapprochement of the economies of the Community and Israel or producing growth or employment. The main sectors of cooperation are set out in Articles 44 to 57, without prejudice to the possibility of including cooperation in other sectors of interest to the Parties.
2. Conservation of the environment and ecological balance shall be taken into account in the implementation of the various sectors of economic cooperation to which it is relevant.
Article 43. Methods and Modalities
Economic cooperation shall be implemented in particular by:
(a) a regular economic dialogue between the Parties, which covers all areas of economic policy and, in particular, fiscal policy, balance of payments and monetary policy, and which shall enhance close collaboration between the authorities concerned with economic policy, each in their respective areas of competence within the Association Council or any other forum designated by the Association Council;
(b) a 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 44. Regional Cooperation
The Parties shall encourage operations designed to promote regional cooperation.
Article 45. Industrial Cooperation
The Parties shall promote cooperation in particular in the following areas:
- industrial cooperation between economic operators in the Community and in Israel, including access for Israel to Community networks for the rapprochement of businesses and decentralised cooperation,
- diversification of industrial output in Israel,
- cooperation between small and medium-sized enterprises in the Community and Israel,
- easier access to investment finance, -information and support services,
- stimulation of innovation.
Article 46. Agriculture
The Parties shall focus cooperation in particular on:
- support for policies implemented by them to diversify production,
- promotion of environment-friendly agriculture,
- closer relations between businesses, groups and organisations representing trades and professions in Israel and in the Community on a voluntary basis,
- technical assistance and training,
- harmonisation of phytosanitary and veterinary standards,
- integrated rural development, including improvement in basic services and development of associated economic activities,
- cooperation among rural regions, exchange of experience and know-how concerning rural development.
Article 47. Standards
The Parties shall aim to reduce differences in standardisation and conformity assessment. To this end the Parties shall conclude where appropriate agreements on mutual recognition in the field of conformity assessment.
Article 48. Financial Services
The Parties shall cooperate, where appropriate through the conclusion of agreements, on the adoption of common rules and standards, inter alia, for accounting and for supervisory and regulatory systems of banking, insurance and other financial sectors.
Article 49. Customs
1. The Parties commit themselves to developing customs cooperation to ensure that the provisions on trade are observed. For this purpose they shall establish a dialogue on customs matters.
2. Cooperation shall focus on the simplification and computerisation of customs procedures, which shall, in particular, take the form of exchange of information among experts and vocational training.
3. Without prejudice to other forms of cooperation envisaged in this agreement, notably for the fight against drugs and money laundering, the Parties' administrations shall provide mutual assistance in accordance with the provisions of Protocol 5.
Article 50. Environment
1. The Parties shall promote cooperation in the tasks of preventing deterioration of the environment, controlling pollution and ensuring the rational use of natural resources, with a view to ensuring sustainable development and promoting regional environmental projects.
2. Cooperation shall focus, in particular, on:
- desertification,
- the quality of Mediterranean water and the control and prevention of marine pollution,
- waste management,
- salinization,
- environmental management of sensitive coastal areas,
- environmental education and awareness,
- the use of advanced tools of environmental management, environmental monitoring methods and surveillance, including the use of environmental information systems (EIS) and environmental impact assessment,
- the impact of industrial development on the environment in general and the safety of industrial facilities in particular,
- the impact of agriculture on soil and water quality.
Article 51. Energy
1. The Parties consider that global warming and the depletion of fossil fuel sources are a serious threat to mankind. The Parties shall therefore cooperate with a view to developing sources of renewable energy, to ensure the use of fuels with the purpose of limiting pollution of the environment and promoting energy conservation.
2. The Parties shall endeavour to encourage operations designed to favour regional cooperation on matters such as transit of gas, oil and electricity.
Article 52. Information Infrastructures and Telecommunications
The Parties shall promote cooperation in the development of information infrastructures and telecommunications to their mutual benefit. Cooperation shall focus primarily on pursuing actions related to research and technological development, harmonisation of standards and modernisation of technology.
Article 53. Transport
1. The Parties shall promote cooperation in the field of transport and related infrastructure, in order to improve the efficiency of movement of passengers and of goods, both at bilateral and regional level.
2. Cooperation shall focus, in particular, on:
- achieving high standards of safety and security in maritime and air transport; for this purpose the Parties shall establish consultations at expert level to exchange information,
- standardisation of technical equipment, in particular in combined, multimodal transport and transhipment,
- promotion of joint technological and research programmes.
Article 54. Tourism
The Parties shall exchange information on planned tourism development and tourism marketing projects, tourism shows, exhibitions, conventions and publications.
Article 55. Approximation of Laws
The Parties shall use their best endeavours to approximate their respective laws in order to facilitate the implementation of this Agreement.
Article 56. Drugs and Money Laundering
1. The Parties shall cooperate with a view in particular to:
- improving the effectiveness of policies and measures to counter the supply of, and illicit trafficking in, narcotic drugs and psychotropic substances and the reduction of the abuse of these products,
- encouraging a joint approach to reducing demand,
- preventing the use of the Parties' financial systems to launder capital arising from criminal activities in general and drug trafficking in particular.
2. Cooperation shall take the form of exchange of information and, where appropriate, joint activities on:
- drafting and implementation of national legislation,
- monitoring trade in precursors,
- establishment of social and health institutions and information systems and the implementation of projects along these lines, including training and research projects,
- implementation of the highest possible international standards relating to the fight against money laundering and the misuse of chemical precursors, in particular those adopted by the Financial Action Task Force (FATF) and the Chemical Action Task Force (CATF).
3. The Parties shall determine together, in accordance with their respective legislation, the strategies and cooperation methods appropriate for attaining these objectives. Their operations, other than joint operations, shall form the subject of consultations and close coordination.
The relevant public and private sector bodies, in accordance with their own powers, working with the competent bodies of Israel, the Community and its Member States, may take part in these operations.
Article 57. Migration
The Parties shall cooperate with a view in particular to: -defining areas of mutual interest concerning policies on immigration, -increasing the effectiveness of measures aimed at preventing or curbing illegal migratory flows.
Title VII. COOPERATION ON AUDIOVISUAL AND CULTURAL MATTERS, INFORMATION AND COMMUNICATION
Article 58.
1. The Parties shall undertake to promote cooperation in the audiovisual sector to their mutual benefit.
2. The Parties shall seek ways of associating Israel with Community initiatives in this sector, thus enabling cooperation in such areas as coproduction, training, development and distribution.
Article 59.
The Parties shall promote cooperation on education, training and youth exchange. The areas of cooperation may include in particular: youth exchanges, cooperation among universities and other educational/training institutions, language training, translation and other ways of promoting better mutual understanding of their respective cultures.
Article 60.
The Parties shall promote cultural cooperation. The areas of cooperation may include in particular translation, exchange of works of art and artists, conservation and restoration of historic and cultural monuments and sites, training of persons working in the cultural field, the organisation of European-oriented cultural events, raising mutual awareness and contributing to the dissemination of information on outstanding cultural events.
Article 61.
The Parties shall promote activities of mutual interest in the field of information and communication.
Article 62.
Cooperation shall be implemented in particular through:
(a) a regular dialogue between the Parties;
(b) a 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 initiatives.
Title VIII. SOCIAL MATTERS
Article 63.
1. The Parties shall conduct a dialogue covering all aspects of mutual interest. The dialogue shall cover in particular questions relating to social problems of post-industrial societies, such as unemployment, rehabilitation of disabled people, equal treatment for men and women, labour relations, vocational training, work safety and hygiene, etc.
2. Cooperation will take place through experts' meetings, seminars and workshops.
Article 64.
1. In order to coordinate the social security regimes of Israeli workers legally employed on the territory of a Member State and of their family members legally resident there, the following provisions should apply, subject to the conditions and modalities applicable in each Member State:
- all periods of insurance, employment or residence fulfilled by such workers in the different Member States shall be totalled for the purposes of the establishment of the right to old age, invalidity and survivors' pensions and allowances and for the purposes of medical care for themselves and their families,
- all pensions and allowances for old age, survivors, accident at work, occupational illness or invalidity, with the exception of non-contributory payments, shall benefit from free transfer to Israel at the rate applicable resulting from the legislation of the liable Member State(s),
- the workers concerned shall receive family allowances for the members of their family referred to above.
2. Israel shall grant to workers who are nationals of a Member State legally employed on its territory and to their family members legally resident there a treatment similar to that referred to in paragraph 1, second and third indents, subject to the conditions and modalities applicable in Israel.
Article 65.
1. The Association Council shall decide on the provisions for the implementation of the objectives contained in Article 64.
2. The Association Council shall decide on the modalities of administrative cooperation to guarantee the management and control necessary for the implementation of the provisions contained in paragraph 1.