TNAG-0385-FCO40-431-Trade-relations-between-Hong-Kong-and-the-EEC-1974 — Page 152

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TO IMMEDIATE THE HAGUE TELEGRAM NO 188 OF 22 OCTOBER AND TO COPENHAGEN BONN PARIS ROME BRUSSELS DUBLIN INFO UKREP EEC

GENERALISED SCHEME OF PREFERENCES

1. IN ACCORDANCE WITH PROTOCOL 23 OF THE TREATY OF ACCESSION, THE UNITED KINGDOM (ALONG WITH DENMARK AND IRELAND) IS TO ALIGN WITH THE COMMUNITY'S GEMERALISED SCHEME OF PREFERENCES (GSP) ON. 1 JANUARY 1974. DISCUSSIONS WITHIN THE COMMUNITY ON THE 1973 SCHEME ARE REACHING A CRITICAL STAGE, THE SCHEME IS LIKELY TO BE DISCUSSED

ON THE BASIS OF COMMISSION PROPOSALS WHICH ARE EXPECTED SHORTLY BY THE THE PERMANENT REPRESENTATIVES (COREPER) ON 25 OCTOBER AND PROBABLY THEREAFTER BY THE COUNCIL OF MINISTERS ON 5/6 NOVEMBER.

2. THE. EEC SCHEME WORKS ON THE BASIS OF DUTY QUOTAS FOR SENSITIVE

PRODUCTS. ONLY A SPECIFIED AMOUNT IS ALLOWED IN DUTY FREE AND WHEN

THE CEILING IS REACHED FOR THE PRODUCT OR FOR INDIVIDUAL EXPORTING COUNTRIES (BUTOIR) THE DUTY BECOMES PAYABLE. THE BUTOIR SYSTEM BEARS PARTICULARLY HARD ON HONG KONG. THE CURRENT UK SYSTEM DOES

KOT HAVE THIS LIMITATION AND OUR SCHEME 16 IN MANY OTHER RESPECTS

ALSO MORE GENEROUS THAN THE EEC'S SCHEME. THE COMMUNITY IS COMMITTED

BY THE PARIS SUMMIT COMMUNIQUE TO IMPROVE ITS SCHEME AND WE HAVE

BEEN PRESSING HARD FOR IMPROVEMENTS LARGELY AS A MEMIS OF LESSENING

THE EFFECT OF OUR GRADUALLY APPLYING THE COMMON EXTERNAL TARIFF TO

IMPORTS FROM DEVELOPING COUNTRIES, ESPECIALLY THE ASIAN COMMONWEALTH ONES, WHICH HAVE NOT BEEN OFFERED ASSOCIATION. WE HAVE ALSO BEEN CONCERNED TO KEEP DOWN THE COSTS OF IMPORTS TO UK CONSUMERS AND PROCESSORS,

3. SOME LIMITED IMPROVEMENTS TO THE EEC SCHEME HAVE ALREADY BEEN

PROVISIONALLY AGREED, INTER ALIA

CONFIDENTIAL

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