0003230
G.F. 323
CONFIDENTIAL
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In
to place imports of the item in question from Hong Kong under surveillance. Likewise, if on U.K. entry there is an overall E.E.C. bilateral agreement on cotton textiles with Hong Kong under Article 4 of the C.T.A. with quotas divided between the individual Member States on the lines indicated in paragraph 26 above, the U.K. would, in the absence of any derogation that may be negotiated, have this arrangement applied to her as well. other words the U.K., as a member of the Community, could be required to open a quota for the import of cotton textiles from Hong Kong as part of the overall Community arrangements; and, if she were then expected to follow normal Community procedures, she would only be permitted on her own initiative to negotiate with Hong Kong the details of categorisation and the administration of quotas within the overall total. Naturally the U.K. would have say in the fixing of the overall figure that would apply to her but, as it would be part of a Community arrangement, any figure established would also need to be acceptable to the enlarged Community as a whole.
34.
as regards cotton textiles the imposition of a tariff in the U.K. on imports from the Commonwealth as from 1st January, 1972 will mean that rates approximately equivalent to the E.E.C. common customs tariff will be in operation in the U.K. as from that date. But the removal of U.K. quotas at the same time could mean that the benchmarks which are at present set by the existing quotas will disappear. Any subsequent entry into the E. 3.C. would, if the Community policy were applied to U.K., then require the negotiation of an entirely new set of quotas on imports into the U.K., including imports from Hong Kong, which would be acceptable to the enlarged E...C. as a whole. It should be noted in this connection that any countries at present in EFTA which did not join an enlarged 3. C., or became associated with it, possibly Portugal, would then be treated as third countries.
including this were
If the case with Portugal her exports to the U.K. would not only be subject to the common customs tariff but could also be subject to quota as well.
35.
The Department is keeping all these possibilities under review and consider that, if agreement were to be reached on the re- opening of negotiations for the entry of the U.K. into the E.D.C., they should be discussed with the British Government. They should
also be taken into account in the examination being conducted in Hong Kong on the implications of the proposed U.K. tariff on cotton textiles and the removal of quotas. In the meantime if members have any comments on the above analysis they will be welcome.
Conclusions
30.
It will be seen from the above that, although progress up to now in the development of the 2. J.C. has not so far created any significant difficulties for Hong Kong, this need not necessarily continue to be the case in all respects. exports to most members of the Community, outside the field of cotton
Up to now Hong Kong's textiles, have been subject only to the common customs tariff and have not had to face further restrictions. such restrictions been imposed on
Only in France have textiles Hong Kong has negotiated separately with the individual
significant scale. ind in cotton Member States of the E.B.C. under the terms of the C.T.A.
37.
The future development of two aspects of the B.B.C.'s common commercial policy, namely policies on import restrictions and on cotton textiles, could, however, change this situation to some extent. In the case of the former it is possible that quantitative
/import
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