TNAG-0298-FCO40-334-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 10

CONFIDENTIAL

(13) In particular the Commission recognise that

the existence of QRS in some Member States could sterilise quotas and they call for these import quotas to be increased where necessary in order to enable the preferential quotas and butoirs to be taken up (this has obvious relevance to the French quotas on Hong Kong) (page 28).

(14) The Commission do not consider low prices to be

a great problem and they point to the Community's anti-dumping regulations and to the power to withdraw preferences in whole or in part as safeguards (pages 29-30).

(15)

There is nothing much we do not know already in the section on origin rules, but some of these have still to be finalised and the paper says that they can be altered from time to time in the light of experience (pages 30-31).

(16) The Community put various reserves on their offer,

e.g.

(a)

(b)

in the case of products not included in the offers of other donors, or if other donors unduly delay the commencement of their schemes;

to modify their scheme in the case of prejudice to the Associated States (pages 34-37).

Annex IV (Sensitive List)

4.

All the Hong Kong sensitive list has been retained with 20% butoirs (apart from 10% on 46.03 -basketware). But there have been certain changes in detail from the position as we previously understood it, i.e.

(a) the quotas for 42.03 (travel goods) and 42.03

(clothes and accessories of leather etc..) have each been split into two;

(b) the quotas have been cut on 69.11 (porcelain

crockery) and 85.21 (transistors) by limiting the supplementary amount to 1% of imports from non- beneficiaries (see para 3(7) above);

(c) the butoir for 46.03 (basketware) is fixed at 10%;

(a)

the ceiling calculations seem to have been altered in most instances from our previous list, mostly downwards but not always;

(e) note (i) the 20% butoirs on the petroleum items

CONFIDENTIAL

-3-

../ (27.10) and

t