TNAG-0630-FCO40-778-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1988 — Page 75

RESTRICTED

ร

TO INDIVIDUAL MEASURES IF SUCH A STEP SHOULD APPEAR NECESSARY WHEN THE AGREEMENTS ARE BEING APPLIED. THIS SYSTEM OPERATES AS FOLLOWS ((1)):

((1)) ON THE UNDERSTANDING THAT SPECIAL ARRANGEMENTS WILL APPLY

TO PRODUCTS WHICH ARE PARTICULARLY SENSITIVE ON A REGIONAL LEVEL: SEE CHAPTER IV, THIRD INDENT.

(1)

THE ''OUTPUT THRESHOLD' SYSTEM IS APPLICABLE ONLY TO PRODUCTS OF RECOGNIZED SENSITIVITY, TAKING INTO ACCOUNT, AMONG OTHER THINGS, THE MARKET PENETRATION RATE.

AS REGARDS THE VARIOUS SUPPLIER COUNTRIES, THE SYSTEM OPERATES AS FOLLOWS:

WITH RESPECT TO THE SUPPLIER COUNTRIES WITH WHICH COMPREHENSIVE AGREEMENTS ARE TO BE CONCLUDED (SEE CHAPTER 11: POINT 2), IT IS ENVISAGED THAT

AT THE REQUEST OF A MEMBER STATE A PRODUCT MAY BE SUBJECT TO A QUOTA OR CEILING SYSTEM WHEN THE SHARE OF THE THIRD COUNTRY CONCERNED REACHES 1 PERCENT (FOR GROUP 2) OR 5 PERCENT (FOR GROUPS 3, 4 AND

OF EXTRA-COMMUNITY IMPORTS:

5)

AT THE REQUEST OF A MEMBER STATE A PRODUCT MAY BE SUBJECT TO A REGIONAL RESTRICTIVE MEASURE IF THE MEMBER STATE CONCERNED FULFILS ITS ABOVE-MENTIONED THEORETICAL SHARE OF 1 PERCENT/5 PERCENT RESPECTIVELY FORMING THE THRESHOLDS FOR THE COMMUNITY AS SUCH.

N.B.

THESE RULES DO NOT APPLY IF THE THRESHOLDS ARE REACHED AS THE

RESULT OF A DROP IN IMPORTS AND NOT CF AN INCREASE IN THE EXPORTS

OF THE THIRD COUNTRY CONCERNED.

WITH RESPECT TO OTHER THIRD COUNTRIES, AGREEMENT WILL BE REACHED,

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