Explanatory Memorandum to COM(2021)707 - Opening and management of autonomous tariff quotas of the Union for certain agricultural and industrial products - Main contents
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| dossier | COM(2021)707 - Opening and management of autonomous tariff quotas of the Union for certain agricultural and industrial products. |
|---|---|
| source | COM(2021)707  |
| date | 19-11-2021 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
Autonomous tariff quotas of the Union are needed for products where production in the Union is insufficient to meet the needs of the user industry in the Union for a given quota period. In response to requests from Member States, the Commission, together with the Member States experts concerned, assesses and decides whether to open autonomous tariff quotas for certain agricultural and industrial products.
On 17 December 2013, the Council of the European Union adopted Regulation (EU) No 1388/2013 opening and providing for the management of autonomous tariff quotas of the Union for certain agricultural and industrial products so that Union demand for the products in question could be met under the most favourable conditions. This Regulation is amended bianually in order to accommodate the needs of the EU industry.
In view of the fact that:
·the Regulation has been amended already 15 times,
·it is necessary to make several amendments to the Combined Nomenclature codes listed in the Annex to Regulation (EU) No 1388/2013 as the product codes of the Combined Nomenclature have been updated by Commission Regulation (EU) 2021/1832 1 in order to fulfil international commitments related to the changes in the Harmonized System nomenclature of 2022,
in the interests of clarity, it is proposed to repeal Council Regulation (EU) 1388/2013 and replace it by the current proposal.
Tariff quotas of the Union should be opened at zero or reduced rates of the autonomous Common Customs Tariff duty for appropriate volumes of certain agricultural and industrial products, without perturbing the markets for such products. Discussions at meetings of the Economic Tariff Questions Group (ETQG), showed that the Member States were ready to open quotas for the products covered by this proposal for a Regulation and that such quotas would not perturb the markets for such products.
The proposal is in line with Union policies on agriculture, trade, enterprise, development, environment, and external relations. This proposal does not affect countries that have a preferential trading agreement with the Union nor candidate countries or potential candidates for preferential agreements with the Union (e.g. Generalised System of Preferences; the African, Caribbean and Pacific group trade regime; Free Trade Agreements).
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The legal basis of this proposal is Article 31 of the Treaty on the Functioning of the European Union (TFEU).
• Subsidiarity (for non-exclusive competence)
The proposal falls under the Union's exclusive competence. The subsidiarity principle therefore does not apply.
• Proportionality
The proposal complies with the principle of proportionality. The measures envisaged are in line with the principles for simplifying procedures for operators engaged in foreign trade, as stated in the Commission communication concerning autonomous tariff suspensions and quotas 2 . This Regulation does not go beyond what is necessary to achieve the objectives pursued in accordance with Article 5 i of the Treaty on European Union (TEU).
• Choice of the instrument
By virtue of Article 31 of the TFEU, 'Common Customs Tariff duties shall be fixed by the Council on a proposal from the Commission'. Therefore, a Council Regulation is the appropriate instrument.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
The autonomous tariff quotas scheme was part of an evaluation study carried out in 2013 on autonomous tariff suspensions 3 .
This is because the two measures are similar, except that tariff quotas limit import volumes. The evaluation concluded that the core rationale for the scheme remains valid. The cost savings for Union businesses importing goods under the scheme can be significant. In turn, depending on the product, company and sector, these savings can have wider benefits, such as boosting competitiveness, making production methods more efficient, and creating or keeping jobs in the Union. Details of the savings of this regulation can be found in point 4 an in the attached legislative financial statement.
• Stakeholder consultations
The Economic Tariff Questions Group (ETQG), which consists of representatives from all Member States plus Turkey, was consulted. All listed tariff quotas were the subject of agreements or compromises reached in the discussions of the group.
The ETQG carefully assessed each request (new, or for an amendment) to ensure that it would not cause any harm to Union producers and would strengthen and consolidate the competitiveness of Union's production. The members of the ETQG carried out the assessment through discussions, and Member States, in turn, consulted the concerned industries, associations, chambers of commerce and other stakeholders involved.
No potential serious risk with irreversible consequences was identified.
• Impact assessment
The proposed amendment is of a purely technical nature and concerns only the coverage of the tariff quotas listed in the Annex to Regulation (EU) No 1388/2013 (which is repealed and replaced by the current proposal). An impact assessment was not carried out because the proposed changes to the tariff quotas are not expected to have significant impacts.
• Fundamental rights
The proposal has no consequences on fundamental rights.
4. BUDGETARY IMPLICATIONS
This proposal has no financial impact on expenditure, but has a financial impact on revenue. Uncollected customs duties corresponding to the suspension amount approximately EUR 186,5 million per year. The negative effect on the budget’s traditional own resources is EUR 139,9 million per year (i.e. 75 % of the total). The legislative financial statement sets out the budgetary implications of the proposal in greater detail.
The loss of revenue in traditional own resources shall be compensated by Member States Gross National Income (GNI) based own resource contributions.