RESTRICTED
GERMANY'S PROBLEMS OVER IMPORTS FROM HONG KONG. WHILE MACAO HAD UNDERTAKEN IN GENERAL TERMS NOT TO DISRUPT THE FRENCH MARKET,
HIS UNDERTAKING NOW REQUIRED A LEGAL FRAMEWORK. FRANCE ASKED WHETHER SHE WAS NOW FREE TO INVOKE ARTICLE 3 OF THE LTA AGAINST KACAO BUT THE COMMISSION DEFERRED GIVING AN ANSWER WHILE THEY
TOOK LEGAL ADVICE.
5. PACLI RECALLED THAT THE COMMISSION HAD 2 YEARS AGO LOOKED AT PROBLEMS POSED BY MACAC BUT HAD DECIDED NOT TO TAKE ACTION. HOWEVER, THEY WOULD AS SOON AS POSSIBLE PRODUCE A PAPER ON THE PRESENT SITUATION FOR CONSIDERATION BY MEMBER STATES,
6. TURNING TO THE COMMISSION'S LIST OF POTENTIALLY SENSITIVE PRODUCTS, PAOLI PROPOSED THAT THE MEETING SHOULD GO THROUGH THIS IN DETAIL. POWNALL SAID THAT ANY LIST OF THIS NATURE SEEMED INEVITABLY TO LEAD TO AGGREGATION OF ITEMS CONTRIBUTED BY ALL MEMBER STATES AND THUS THE LIST WOULD BE COMPREHENSIVE RATHER THAN SELECTIVE. THE UK CONSIDERED THAT, IN JUDGING WHETHER OR NOT PRODUCTC SHOULD BE REGARDED AS SENSITIVE, IT WAS NECESSARY TO TAKE ACCOUNT OF OTHER FACTORS IN ADDITION TO IMPORT STATISTICS, PARTICULARLY THE CIRCUMSTANCES OF DOMESTIC PRODUCERS. IT WAS LIKELY THAT IF THE COMMUNITY SOUGHT VOLUNTARY EXPORT RESTRAINTS
BY FAR EASTERN SUPPLIERS THE COMMISSION WOULD BE PRESSED TO DEVELOP
THE FULL JUSTIFICATION OF THEIR CASE. WHILE THIS INTERVENTION
DID NOT FIND MUCH SUPPORT FROM OTHER DELEGATIONS, IT STEERED THE
WHOLE DISCUSSION AWAY FROM THE COMMISSION'S LIST WHICH WAS NOT
FURTHER CONSIDERED. ITALY DECLARED DIFFICULTIES OF PRINCIPLE OVER
EXAMINING THE LIST SINCE THIS INVOLVED MAKING ASSUMPTIONS ABOUT
THE USES TO WHICH IT WOULD BE PUT. ITALY HAD AN EXPORT INTEREST
IN SENDING WOOLLENS TO HONG KONG. ANY DISCUSSION IN THE COMMUNITY
WAS LIKELY TO BECOME PUBLIC AND, UNLESS POLICY GUIDELINES WERE
FRIST ESTABLISHED, VIEWS TAKEN ON INDIVIDUAL PRODUCTS WERE LIKELY
TO MAKE THE EEC'S POSITION IN THE GATT TEXTILE DISCUSSIONS MORE ·
DIFFICULT. THE GERMANS SAID THEY WERE UNABLE TO CLARIFY THEIR
POSITION OVER THE GATT TEXTILES DISCUSSIONS PENDING DECISIONS IN
BONN.
7. SEE M IF T.
FCO PASS ADVANCE COPIES TO:-
FCO
HALL (EID).
1
UTI RIDLEY, MISS LOWNE, GWINNELL (CT DIV.), WRIGHT (CRE3).
PALLISER
/REPEATED AS REQUESTED/ ZADVANCED AS REQUESTED/
EUROPEAN ECONOMIC DISTRIBUTION
EID
ADDITIONAL DISTRIBUTION
FRAME
3 RESTRICTED
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