nine years after the date of entry into force of this Agreement each duty shall be reduced to 38 % of the basic duty;
10 years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty;
11 years after the date of entry into force of this Agreement each duty shall be reduced to 13 % of the basic duty;
12 years after the date of entry into force of this Agreement the remaining duties shall be abolished.
6. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 5 shall be progressively reduced according to the schedule included in that Annex.
7. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex III, list 6 shall be periodically reviewed in the course of the operation of the Agreement in view of the further liberalisation of trade.
South Africa will inform the Community about the outcome of the South African motor industry development programme review. It will present proposals for a further liberalisation of South African imports of automotive products from the Community mentioned in Annex III, lists 5 and 6. The Parties will jointly examine these proposals in the second six months of the year 2000.
Section C. Agricultural Products
Article 13. Definition
The provisions of this section apply to products originating in the Community and South Africa covered by the WTO definition of agricultural products as well as fish and fisheries products (Chapter 3, 1604, 1605 and products 0511 91 10, 0511 91 90, 1902 20 10 and 2301 20 00).
Article 14. Tariff Elimination by the Community
1. Customs duties applicable on import into the Community of agricultural products originating in South Africa other than those listed in Annex IV shall be abolished on the entry into force of this Agreement.
2. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 1 shall be progressively abolished in accordance with the following schedule:
on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty;
one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty;
two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty;
three years after the date of entry into force of this Agreement the remaining duties shall be abolished.
3. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 2 shall be progressively abolished in accordance with the following schedule:
on the date of entry into force of this Agreement each duty shall be reduced to 91 % of the basic duty;
one year after the date of entry into force of this Agreement each duty shall be reduced to 82 % of the basic duty;
two years after the date of entry into force of this Agreement each duty shall be reduced to 73 % of the basic duty;
three years after the date of entry into force of this Agreement each duty shall be reduced to 64 % of the basic duty;
four years after the date of entry into force of this Agreement each duty shall be reduced to 55 % of the basic duty;
five years after the date of entry into force of this Agreement each duty shall be reduced to 45 % of the basic duty;
six years after the date of entry into force of this Agreement each duty shall be reduced to 36 % of the basic duty;
seven years after the date of entry into force of this Agreement each duty shall be reduced to 27 % of the basic duty;
eight years after the date of entry into force of this Agreement each duty shall be reduced to 18 % of the basic duty;
nine years after the date of entry into force of this Agreement each duty shall be reduced to 9 % of the basic duty;
10 years after the date of entry into force of this Agreement the remaining duties shall be abolished.
4. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 3 shall be progressively abolished in accordance with the following schedule:
three years after the date of entry into force of this Agreement each duty shall be reduced to 87 % of the basic duty;
four years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty;
five years after the date of entry into force of this Agreement each duty shall be reduced to 62 % of the basic duty;
six years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty;
seven years after the date of entry into force of this Agreement each duty shall be reduced to 37 % of the basic duty;
eight years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty;
nine years after the date of entry into force of this Agreement each duty shall be reduced to 12 % of the basic duty;
10 years after the date of entry into force of this Agreement the remaining duties shall be abolished.
For certain products referred to in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase down for these products.
5. Customs duties applicable on import into the Community of products originating in South Africa listed in Annex IV, list 4 shall be progressively abolished in accordance with the following schedule:
five years after the date of entry into force of this Agreement each duty and charge shall be reduced to 83 % of the basic duty;
six years after the date of entry into force of this Agreement each duty and charge shall be reduced to 67 % of the basic duty;
seven years after the date of entry into force of this Agreement each duty and charge shall be reduced to 50 % of the basic duty;
eight years after the date of entry into force of this Agreement each duty and charge shall be reduced to 33 % of the basic duty;
nine years after the date of entry into force of this Agreement each duty and charge shall be reduced to 17 % of the basic duty;
10 years after the date of entry into force of this Agreement the remaining duties shall be abolished.
For certain products referred to in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase-down for these products.
6. Customs duties applicable to processed agricultural products imported into the Community and originating in South Africa are listed in Annex IV, list 5 and shall be applied in accordance with the conditions mentioned therein.
The Cooperation Council may decide on:
(a) the extension of the list of processed agricultural products under Annex IV, list 5, and
(b) the reduction of the duties applying to processed agricultural products. This reduction of duties may take place when in trade between the Community and South Africa the duties applying to basic products are reduced or, in response to reductions resulting from the mutual concessions relating to processed agricultural products.
7. Reduced customs duties applicable to certain agricultural products imported into the Community and originating in South Africa are listed in Annex IV, list 6, and shall be applied as from entry into force of this Agreement and in accordance with the conditions mentioned in this Annex.
8. Customs duties applicable on import into the European Community of products originating in the Republic of South Africa listed in Annex IV, list 7 shall be reviewed periodically in the course of the operation of the Agreement on the basis of future developments in the common agricultural policy.
9. Tariff concessions on products listed in Annex IV, list 8 are not applicable as these products are covered by protected EU denominations.
10. Tariff concessions applicable on import into the Community of products originating in South Africa listed in Annex V shall be applied in accordance with the conditions mentioned therein.
Article 15. Tariff Elimination by South Africa
1. Customs duties applicable on import into South Africa of agricultural products originating in the Community other than those listed in Annex VI shall be abolished on the entry into force of this Agreement.
2. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 1 shall be progressively abolished in accordance with the following schedule:
on the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty;
one year after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty;
two years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty;
three years after the date of entry into force of this Agreement the remaining duties shall be abolished.
3. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 2 shall be progressively abolished in accordance with the following schedule:
three years after the date of entry into force of this Agreement each duty shall be reduced to 67 % of the basic duty;
four years after the date of entry into force of this Agreement each duty shall be reduced to 33 % of the basic duty;
five years after the date of entry into force of this Agreement the remaining duties shall be abolished.
4. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 3 shall be progressively abolished in accordance with the following schedule:
five years after the date of entry into force of this Agreement each duty shall be reduced to 88 % of the basic duty;
six years after the date of entry into force of this Agreement each duty shall be reduced to 75 % of the basic duty;
seven years after the date of entry into force of this Agreement each duty shall be reduced to 63 % of the basic duty;
eight years after the date of entry into force of this Agreement each duty shall be reduced to 50 % of the basic duty;
nine years after the date of entry into force of this Agreement each duty shall be reduced to 38 % of the basic duty;
10 years after the date of entry into force of this Agreement each duty shall be reduced to 25 % of the basic duty;
11 years after the date of entry into force of this Agreement each duty shall be reduced to 13 % of the basic duty;
12 years after the date of entry into force of this Agreement the remaining duties shall be abolished.
For certain products indicated in this Annex a duty free quota shall apply, in accordance with the conditions there mentioned, as from entry into force of the Agreement until the end of the tariff phase down for these products.
5. Customs duties applicable on import into South Africa of products originating in the Community listed in Annex VI, list 4 shall be reviewed periodically in the course of the operation of the Agreement.
6. Customs duties applicable on import into South Africa of fisheries products originating in the Community listed in Annex VII shall be progressively abolished in parallel with the elimination of customs duties of the corresponding tariff positions by the Community.
Article 16. Agricultural Safeguard
Notwithstanding other provisions of this Agreement and in particular Article 24, if, given the particular sensitivity of the agricultural markets, imports of products originating in one Party cause or threaten to cause a serious disturbance to the markets in the other Party, the Cooperation Council shall immediately consider the matter to find an appropriate solution. Pending a decision by the Cooperation Council, and where exceptional circumstances require immediate action, the affected Party may take provisional measures necessary to limit or redress the disturbance. In taking such provisional measures, the affected Party shall take into account the interests of both Parties.
Article 17. Accelerated Tariff Elimination by South Africa
1. If requested by South Africa, the Community shall consider proposals relating to an accelerated timetable for tariff elimination for imports of agricultural products into South Africa, coupled with the elimination of all export refunds for exports to South Africa of the same products originating in the European Community.
2. If the Community replies positively to this request, the new timetables for tariff elimination and elimination of export refunds shall simultaneously apply as of a date to be agreed by the two Parties. 3. In case of a negative response from the Community, the provisions of this Agreement on tariff elimination shall continue to be applicable.
Article 18. Review Clause
No later than five years after the entry into force of this Agreement, the Community and South Africa shall consider further steps in the process of liberalisation of their reciprocal trade. For this purpose, a review shall be undertaken of, in particular but not exclusively, the customs duties applicable to products listed in Annex II, list 5, Annex III, lists 5 and 6, Annex IV, lists 5, 6 and 7, Annex V, lists 1, 2, 3 and 4, Annex VI, lists 4 and 5 and Annex VII.
Title III. TRADE RELATED ISSUES
Section A. Common Provisions
Article 19. Border Measures
1. Quantitative restrictions on imports or exports and measures having equivalent effect on trade between South Africa and the Community shall be abolished on the entry into force of this Agreement.
2. No new quantitative restrictions on imports or exports or measures having equivalent effect shall be introduced in trade between the Community and South Africa.
3. No new customs duties on imports or exports or charges having equivalent effect shall be introduced, nor shall those already applied be increased, in the trade between the Community and South Africa from the date of entry into force of this Agreement.
Article 20. Agricultural Policies
1. The Parties may have regular consultations in the Cooperation Council on the strategy and practical modalities of their respective agricultural policies.
2. If either Party, in pursuit of their respective agricultural policies, considers it necessary to amend the arrangements laid down in this Agreement it will notify the Cooperation Council, which will decide on the requested modification.
3. If the Community or South Africa, in applying paragraph 2, amends the arrangements made by this Agreement for agricultural products, it shall make adjustments to be agreed on by the Cooperation Council so as to maintain the concessions on imports originating in the other Party at an equivalent level to that provided for in this Agreement.
Article 21. Fiscal Measures
1. The Parties shall refrain from any measure or practice of an internal fiscal nature establishing, whether directly or indirectly, discrimination between the products of one Party and products originating in the territory of the other Party.
2. Products exported to the territory of one of the Parties may not benefit from repayment of indirect internal taxation in excess of the amount of indirect taxation imposed on them directly or indirectly.
Article 22. Customs Unions and Free-trade Areas
1. The Agreement shall not preclude the maintenance or establishment of customs unions, free-trade areas or other arrangements between either of the Parties and third countries, except in so far as they alter the rights and obligations provided for in this Agreement.
2. Consultation between the Community and South Africa shall take place within the Cooperation Council concerning agreements establishing or adjusting customs unions or free-trade areas and, where required, on other major issues related to their respective trade policy with third countries. In particular, in the event of a third country acceding to the European Union, such consultation shall take place so as to ensure that account can be taken of the mutual interests of the Community and South Africa.
Article 23. Anti-dumping and Countervailing Measures
1. Nothing in this Agreement shall prejudice or affect in any way the taking, by either Party, of anti-dumping or countervailing measures in accordance with Article VI of the GATT 1994, the Agreement on Implementation of Article VI of the GATT 1994, the Agreement on Subsidies and Countervailing Measures, annexed to the Marrakech Agreement establishing the WTO.
2. Before definitive anti-dumping and countervailing duties are imposed in respect of products imported from South Africa, the Parties may consider the possibility of constructive remedies as provided for in the Agreement on Implementation of Article VI of the GATT 1994 and the Agreement on Subsidies and Countervailing Measures.
Article 24. Safeguard Clause
1. Where any product is being imported in such increased quantities and under such conditions as to cause or threaten to cause serious injury to domestic producers of like or directly competitive products in the territory of one of the Contracting Parties, the Community or South Africa, whichever is concerned, may take appropriate measures under the conditions provided for in the WTO Agreement on Safeguards or the Agreement on Agriculture annexed to the Marrakech Agreement establishing the WTO and in accordance with the procedures laid down in Article 26.
2. Where any product is being imported in such increased quantities and under such conditions as to cause or threaten to cause serious deterioration in the economic situation of the European Union's outermost regions, the European Union, after having examined alternative solutions, may exceptionally take surveillance or safeguard measures limited to the region(s) concerned, in accordance with the procedures laid down in Article 26.
3. Where any product is being imported in such quantities and under such conditions as to cause or threaten to cause serious deterioration in the economic situation of one or more of the other Members of the Southern African Customs Union, South Africa, at the request of the country or countries concerned, and after having examined alternative solutions, may exceptionally take surveillance or safeguard measures in accordance with the procedures laid down in Article 26.
Article 25. Transitional Safeguard Measures
1. Notwithstanding the provisions of Article 24, exceptional measures of limited duration which derogate from the provisions of Articles 12 and 15 may be taken by South Africa in the form of an increase or reintroduction of customs duties.
2. These measures may only concern infant industries or sectors facing serious difficulties caused by increased imports originating in the Community as a result of the reduction of duties envisaged under Articles 12 and 15, particularly where these difficulties produce major social problems.
3. Customs duties on imports applicable in South Africa to products originating in the Community introduced by these measures may not exceed the level of the basic duty or the applied MFN rates of duty or 20 % ad valorem, whichever is the lower, and shall maintain an element of preference for products originating in the Community. The total value of all imports of the products which are subject to these measures may not exceed 10 % of total imports of industrial products from the Community during the last year for which statistics are available.
4. These measures shall be applied for a period not exceeding four years. They shall cease to apply at the latest on the expiry of the maximum transitional period of 12 years. These time limits may exceptionally be extended by decision of the Cooperation Council.
5. No such measures can be introduced in respect of a product if more than three years have elapsed since the elimination of all duties and quantitative restrictions or charges or measures having an equivalent effect concerning that product.
6. South Africa shall notify the Cooperation Council of the exceptional measures it intends to take and, at the request of the Community, consultations shall be held on such measures before they are applied in order to reach a satisfactory solution. Its notification shall include an indicative schedule for the introduction and subsequent elimination of the customs duties to be imposed.
7. If no agreement on the proposed measures referred to in paragraph 6 has been reached within 30 days of such notification, South Africa may take the appropriate measures to remedy the problem and shall provide the Cooperation Council with the definite schedule for the elimination of the customs duties introduced under this Article. This schedule shall provide for a phasing out of these duties at equal annual rates starting at the latest one year after their introduction. The Cooperation Council may decide on a different schedule.
Article 26. Safeguard Procedures
1. In the event of the Community or South Africa initiating a surveillance mechanism in respect of difficulties referred to in Article 24 which has as its purpose the rapid provision of information on the trend of trade flows, it shall inform the other Party thereof and, if requested, enter into consultations with it.
2. In the cases specified in Article 24, before taking the measure provided for therein or, in cases to which subparagraph 5(b) of this Article apply, the Community or South Africa, as the case may be, shall as soon as possible supply the Cooperation Council with all relevant information, with the view to seeking a solution acceptable to both Parties.
3. In the selection of measures, priority must be given to those which least disturb the functioning of this Agreement and they shall be limited to the extent necessary to prevent or remedy serious injury and to facilitate adjustment.
4. The safeguard measures shall be notified immediately to the Cooperation Council and shall be the subject of periodic consultations within that body, particularly with a view to establishing a timetable for their abolition as soon as circumstances permit.
5. For the implementation of the previous paragraphs the following provisions shall apply.
(a) As regards Article 24, difficulties arising from the situation referred to in that Article shall be referred for examination to the Cooperation Council, which may take any decision needed to put an end to such difficulties. If the Cooperation Council or the exporting Party has not taken a decision putting an end to the difficulties or no other satisfactory solution has been reached within 30 days of the matter being so referred, the importing Party may adopt appropriate measures to remedy the problem. Such measures should be taken for a period not exceeding three years and shall contain elements which would degressively lead to their elimination at the end of the set period, at the latest.
(b) Where exceptional circumstances requiring immediate action make prior information or examination, as the case may be, impossible, the Community or South Africa, whichever is concerned, may, in the situations specified in Article 24, apply forthwith the precautionary measures necessary to deal with the situation and shall inform the other Party immediately thereof.
Article 27. Exceptions
The Agreement shall not preclude prohibitions or restrictions on imports, exports, goods in transit or trade in used goods justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of intellectual, industrial and commercial property or rules relating to gold and silver. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary or unjustifiable discrimination where the same conditions prevail or a disguised restriction on trade between the Parties.
Article 28. Rules of Origin
The rules of origin for the application of tariff preferences provided for in this Agreement are laid down in Protocol 1.
Section B. Right of Establishment and Supply of Services
Article 29. Reconfirmation of GATS Obligations
1. In recognition of the growing importance of services for the development of their economies, the Parties underline the importance of strict observance of the General Agreement on Trade in Services (GATS), in particular its principle on most-favoured-nation treatment, and including its applicable protocols with annexed commitments.
2. In accordance with the GATS, this treatment shall not apply to:
(a) advantages accorded by either Party under the provisions of an agreement as defined in Article V of the GATS or under measures adopted on the basis of such an agreement;
(b) other advantages accorded pursuant to the list of most-favoured-nation exemptions annexed by either Party to the GATS.
3. The Parties reaffirm their respective commitments as annexed to the fourth Protocol to the GATS concerning basic telecoms and the fifth Protocol concerning financial services.
Article 30. Further Liberalisation of Supply of Services
1. The Parties will endeavour to extend the scope of the Agreement with a view to further liberalising trade in services between the Parties. In the event of such an extension, the liberalisation process shall provide for the absence or elimination of substantially all discrimination between the Parties in the services sectors covered and should cover all modes of supply including the supply of a service:
(a) from the territory of one Party into the territory of the other;
(b) in the territory of one Party to the service consumer of the other;
(c) by a service supplier of one Party, through commercial presence in the territory of the other;
(d) by a service supplier of one Party, through presence of natural persons of that Party in the territory of the other.
2. The Cooperation Council shall make the necessary recommendations for the implementation of the objective set out in paragraph 1.
3. When formulating these recommendations, the Cooperation Council shall take into account the experience gained by the implementation of the obligations of each Party under the GATS, with particular reference to Article V generally and especially paragraph 3(a) thereof covering the participation of developing countries in liberalisation agreements.
4. The objective set out in paragraph 1 shall be subject to a first examination by the Cooperation Council at the latest five years after the entry into force of this Agreement.
Article 31. Maritime Transport
1. The Parties shall endeavour to apply effectively the principle of unrestricted access to the international maritime market and traffic based on fair competition on a commercial basis.
2. The Parties agree to extend to each other's nationals and the vessels registered in the territory of either of the Parties treatment no less favourable than that granted to the most favoured nation in respect of the maritime transport of goods, passengers or both, access to ports, the use of infrastructure and auxiliary maritime services of those ports and related fees and charges, customs facilities and the assignment of berths and facilities for loading and unloading, based on fair competition and on commercial terms.
3. The Parties agree to consider maritime transport, including intermodal operations, in the context of Article 30, without prejudice to nationality restrictions or agreements entered into by either Party, which exist at that time and which would be consistent with the Parties' rights and obligations under the GATS Agreement.