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Trade and Industry Department The Government of the Hong Kong Special Administrative Region
Brand Hong Kong - Asia world city
MY COLOUR

Commercial Information Circulars

24-hour hotline : 23 922 922

Ref : CR EIC 230/20/1

28 January 2002

Dear Sirs,

 

Commercial Information Circular No. 11/02

European Union (EU)*: New Generalised Scheme of Tariff
Preferences for 2002-2004

The European Commission (EC) published on 31 December 2001 the Regulation applying a new Generalised Scheme of Tariff Preferences (GSP) for the period from 1 January 2002 to 31 December 2004. The relevant Council Regulation (EC) No. 2501/2001 is at Annex (pdf format) of this Circular.

DETAILS

  1. The new GSP provides tariff preferences to imports originating in a total of 179 countries and territories listed in Annex I of the Regulation. Though Hong Kong has been excluded from the GSP since 1 May 1998, China continues to be a major beneficiary. The tariff preferences enjoyed by most of its products are of re-export interest to Hong Kong.

  2. Salient features of the new GSP are summarized below -

    Product coverage and tariff preferences

    1. The new GSP provides tariff preferences to a wide coverage of agricultural and industrial products. Preferences are differentiated according to the sensitivity of products to the EU's domestic industry. There are two product categories, i.e. sensitive and non-sensitive. The list of products included in the new GSP and their respective categories are set out in Annex IV (pdf format) of the Regulation;

    2. Tariffs on non-sensitive products are to be entirely suspended, except for agricultural components;

    3. Tariffs on sensitive products are to be reduced by 3.5 percentage points. Tariffs for products of Combined Nomenclature (CN) Chapters 50 to 63 (textiles and clothing) are to be reduced by 20%;

    4. Where tariff preferences applied as according to (b) and (c) above are less favourable than those applied under the previous version of the GSP (the GSP applied from 1 July 1999 to 31 December 2001), the previous preferential rates shall continue to be applied;

    5. Where tariff preferences applied as according to (b) and (c) above result in duty rates of 1% or less, or duty values at Euro 2 or less, such duties are to be entirely suspended;

    6. Tariff preferences are not available to certain product sectors originating in certain countries. Column C of Annex I (pdf format )of the Regulation indicates such sectors of the countries concerned. Under this provision, for instance, certain products of CN Chapters 72 and 73 (iron and steel) originating in China are excluded from the tariff preferences;

    7. Tariff preferences are also not available to product sectors from which preferences were removed under the previous version of the GSP. Column D of Annex I (pdf format )of the Regulation indicates the sectors and countries concerned. Under this provision, for instance, products of CN Chapters 42 to 43 (articles of leather and furskins), 61 to 63 (clothing), 64 to 67 (footwear), etc. originating in China are excluded from the tariff preferences;

      Graduation

    8. All tariff preferences or tariff preferences for particular products shall be removed if a beneficiary country, during three consecutive years, meets certain specified criteria. The graduated beneficiary country or its graduated products should be readmitted when they do not meet the specified criteria during the following three consecutive years. The EC shall publish notices in the Official Journal# listing the beneficiary countries and sectors that are affected by these provisions;

      Temporary withdrawal of tariff preferences

    9. The preferential arrangements provided for in the new GSP may be temporarily withdrawn, in respect of all or of certain products originating in a beneficiary country, for certain specified reasons, such as fraud or systematic failure to comply with the rules of origin of products or unfair trading practices including those which are prohibited under the World Trade Organization Agreements; and

      Origin rules

    10. Tariff preferences are provided to products originating in the specified countries. The rules concerning the definition of the concept of originating products and the proof of origin are laid down in Commission Regulation (EEC) No. 2454/93+.

ENQUIRIES

  1. For enquiries about the contents of this Circular, please contact the undersigned at telephone number 2398 5684.

Yours faithfully,

 

(Miss Helen YUNG)

for Director-General of Trade and Industry

* : The EU Member States are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom.



Note : While every effort is made to ensure the accuracy of the above information, the Department cannot guarantee this to be so and will not be held liable for any reliance placed on the same.