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Brief No 4
BRIEF NO. 4
IMPORT LICENSING UNDER FEC/HONG KONG BILATERAL TEXTILES AGREGMENT
Line to Take:
After some initial teething troubles, resolved by close liaison between Hong Kong and UK officials, the administrative arrangements now appear to be running smoothly. There remain one or two technical problems (affecting classification and weight aspects) which are the subject of discussions between the EEC Commission and Hong Kong.
Background
The licensing provisions of the EEC/Hong Kong bilateral textiles agreement require that Hong Kong shall issue export licences, in exchange for which EEC member states shall issue import licences, within the limits of quota restrictions. In general, the arrangements work smoothly but there were difficulties at the end of 1978 when, because the UK had issued import licences up to the quota limit for one category of goods, the UK suspended further licensing for that category pending reconciliation of our respective licensing records. This caused intense opposition from the long Kong authorities and strong criticism of the UK's actions in the Hong Kong press.
The difficulty arose in part because the UK had been unable to take into account the cancellation by Hong Kong of some export licences, against which we had issued import licences. Towards the end of any ouota year the time-lag between Fong Kong cancelling or amending its export licences and the UK Import Licensing Branch receiving Hong Kong's notification to that effect, can cause our records to reach a critical point without the quota being exceeded by actual shipments. In addition, our recording methods at that time were not conducive to the rapid exchange of information with Hong Kong on the state of quota utilisation. The particular dispute was satisfactorily resolved and adjustments have been made to our licence recording system to facilitate identification of discrepancies which may arise in future; and further improvements are being made to facilitate the exchange of licensing records.
The close liaison which has been developed between officials of both Governments has led to a better understanding of the administrative problems facing both sides. A Department of Trade official attended a Seminar in April 1979 organised by Fong Kong to explain their export licensing system to representatives of the Commission and of EEC member states.
Although there are still some problems remaining as to interpretation of certain aspects of the Agreement (in particular, disagreements concerning the classification of certain products, and the counting of non-textile components against the opota weight limits), administrative procedures have been agreed bilaterally to prevent these problems interfering with trade while the technicalities are discussed between EBC Commission and Hong Kong officials.