TNAG-0139-FCO40-175-Effect-of-EEC-common-commercial-policy-on-Hong-Kong-exports-1969 — Page 55

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11.

(ii) the varying attitudes of the Member States towards

liberalisation;

(iii) that the more liberal Member States were waiting for

the application under Article 111 (3) of qualified majority voting to the establishing of a common commercial policy and for the opening thus provided to defeat French protectionism;

(iv) the unwillingness of France in particular to be

hurried by the technocrats in Brussels.

Earlier this month, however, the Commission again returned to the attach, this time in the textiles sector. The Commission have invited Member States to a meeting to discuss textile difficulties including lack of co-ordination of Members' policies regarding tariffs and imports from developing countries. The Department is obtaining a summary of the proposals which will clearly be of some relevance to Hong Kong. The Commission are also becoming increasingly concerned at the Council's failure to grasp the common commercial policy nettle, particularly as the date for establishing a common customs tariff draws near. Again, the crucial factor will probably continue to be the extent to which the Council is preoccupied with a recalcitrant France, particularly on the delicate agriculture and voting issues. Apparently there are already murmurings in Brussels of a possible further crisis.

12.

In the meantime, Article 115 of the Rome Treaty provides a way round any difficulties which might result, in the absence of a common commercial policy, from the introduction of free movement of goods during the transitional period -

"In order to ensure that the execution of measures of commercial policy taken in conformity with this Treaty by any Member State are not obstructed by deflection of trade, or where disparities between such measures lead to economic difficulties in one or more of the Member States, the Commission shall recommend the methods by which other Member States shall afford the co-operation necessary. Failing this, the Commission shall authorize Member States to take the necessary protective measures the conditions and details of which it shall determine."

In accordance with this article, the Commission may authorise individual Member States not to accord Community treatment to specified products which they subject to quantitative restrictions when imported from specified countries. The Commission have, however, on several occasions disapproved of the use of Article 115 in preference to the establishment of a common commercial policy.

13.

If the Community were to apply French restrictions as its common policy towards Hong Kong, Hong Kong might have some defence under G.A.T.T. Article XXIV (5) which states

"with respect to a customs union

the

regulations of commerce imposed at the institution of the union

shall not on the whole be

higher or more restrictive than the general incidence

of

the regulations of commerce applicable in

the constituent territories prior to the formation of the union

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