TNAG-0139-FCO40-175-Effect-of-EEC-common-commercial-policy-on-Hong-Kong-exports-1969 — Page 52

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all charges with-equivalent effect, and the adoption of a common customs tariff in their relations with third countries."

In accordance with Article 10, this free movement of goods within the Commu ty applies not only to products originating in the Member States but also to products imported from third countries, when customs duties and charges of equivalent effect have been paid on entry into one of the Member States (see Footnote).

4.

The Community can achieve the free internal movement of imports from third countries only if each Member State subjects such imports to

Towards achieving identical treatment on entry into the Common Market.

this object, the Member States are progressively aligning their customs duties with the Common Customs Tariff. As regards other import regulations, they must also co-ordinate their practices until they have reached what Article 111 (1) describes as "the conditions necessary for the implementation of a common policy in the field of external trade". The Commission are under obligation to submit proposals to the Council on the procedure to be followed during the transitional period to achieve this end.

5.

The area within this common policy causing most concern to Hong Kong is quantitative restrictions. At the time of writing, the following discriminatory quantitative restrictions were applied to imports from Hong Kong -

by France to a wide range of products including food specialities, plastic articles, fabrics of silk and of artificial and synthetic fibres, cotton textiles (other than yarn), garments, footwear, flash lights, toys, buttons, cameras, binoculars, radios, imitation jewellery, chinaware, umbrellas, batteries, pleasure boats.

Hong Kong was also exercising voluntary restraint on exports

to West Germany of knitted outerwear, gloves, cotton woven nightwear;

to the Benelux of woven cotton shirts.

Not one of these restrictions is common to all the Member States of the Community. Thus, if there were no frontier control on the flow of Hong Kong goods between Member States, French quotas and Hong Kong's voluntary restrictions on exports to 'est Germany and the Benelux could be rendered meaningless by unrestricted imports of Hong Kong products through the other Member States.

6. The best solution for Hong Kong would be, of course, removal of all discriminatory quantitative restrictions now imposed by the Member States against imports from Hong Kong. This is the solution favoured by

tome Treaty whose Article 110 states

the

"by establishing a customs union, the Member States aim to

contribute, in the common interest, to the harmonious development of world trade, the progressive abolition of restrictions on international trade and the lowering of customs barriers."

The Hong Kong Government "rade Mission to the Common Market Countries in October 1963 raised the issue in discussion with senior Commission

/officials

Footnote: The common tariff and the free movement of goods are essential characteristics of a common market. In a free trade area, on the other hand, each member state applies its own tariff to third countries products which may not circulate freely within the area.

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