TNAG-0627-FCO40-775-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 39

DSR 11C

discussion.

However, the French announcement on Saturday

18 June of GATT Article XIX and other safeguard measures

could reopen the question of the mandate within the

Community.

7. On 18 June the French Minister of Agriculture,

M Rossi, made a surprise announcement that France was to

take GATT Article XIX action on 22 June against the products

mentioned in para 4 above. They intend also to take similar

safeguard action against those countries (Lomé and the

Mediterranean associates) with whom the Community has

preferential agreements. Furthermore, they intend to take

action on four more products (dresses and skirts, suits,

trousers and cotton fabric) against Morocco, Tunisia, Spain,

All the French actions Turkey and Mauritius.

came as a great surprise

particularly since they French had not mentioned it in the

Community when they agreed to the mandate the day before the

announcement was made.

8. The French announcement is to be discussed within the

Community today. There are serious doubts about its legality

and it could have economic consequences for other Member

States through deflection of trade and through the fact that

it may amount to a unilateral abrogation of the Community's

textile agreements with third countries. It remains to be

seen whether the Commission will legalise the French action.

There is a serious danger that other Member States, particu-

larly the Dutch, will follow suit and pressure on the

Government to do the same is likely to mount rapidly.

French action could mean that discussion both within the

Community and within the GATT Textiles Committee will be

diverted away from the Community mandate on the MFA itself.

The