Explanatory Memorandum to COM(2001)608 - Community position within the Cooperation Council on the introduction of two Joint Declarations concerning Andorra and San Marino and on amendments to Protocol 4 on the definition of the concept 'of originating products' and methods of administrative cooperation set out in the Interim Agreement on trade and trade-related matters between the EC and Macedonia

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1. Rules of origin are essential to the correct functioning of the free trade agreements between the Community and its trading partners, including the former Yugoslav Republic of Macedonia. The European Communities and its Member States, of the one part, and the former Yugoslav Republic of Macedonia, of the other part, have signed a Stabilisation and Association Agreement on 9 April 2001. The Interim Agreement on trade and trade-related matters between the European Community and the former Yugoslav Republic of Macedonia has entered into force on 1 June 2001.

Protocol 4 concerning the definition of the concept of originating products and methods of administrative cooperation has been adopted together with the Interim Agreement and has entered into force, as well, on 1 June 2001.

2. In the context of the new Interim Agreement, preferential treatment may not be granted to products originating in the Republic of San Marino and to products falling within Chapters 25 to 97 originating in the Principality of Andorra when these products are exported from those countries to the former Yugoslav Republic of Macedonia. The Republic of San Marino and Andorra are bound to a customs union with the Community for those products and identical joint declarations have been included, as a standard and consolidated practice, in most preferential agreements to ensure that Protocol 4 is applied mutatis mutandis to the above-mentioned products originating in the Principality of Andorra and the Republic of San Marino. Such joint declarations would ensure that those products are accepted at importation in the former Yugoslav Republic of Macedonia as originating in the Community and that customs authorities of the former Yugoslav Republic of Macedonia would grant preferential treatment to those products, accordingly.

3. In the interest of clarity, it is desirable to correct a number of material errors, as well as certain errors in Protocol 4 related to mistaken references in individual Articles to other Articles. These corrections would ensure a smooth and uniform application of the provisions contained in Protocol 4.

4. The Commission therefore calls on the Council to draw up a common position for presentation to the Cooperation Council CE - former Yugoslav Republic of Macedonia.