ARRANGEMENT in the form of an exchange of letters between the European Economic Community and the Eastern Republic of Uruguay on trade in mutton and lamb

Letter No 1

Sir,

I have the honour to refer to the negotiations recently undertaken between our respective delegations for the purpose of drawing up provisions concerning import into the European Economic Community of mutton, lamb and goatmeat from Uruguay in connection with the implementation by the Community of the common organization of the market in sheepmeat and goatmeat.

During these negotiations both parties agreed as follows: 1. This arrangement shall relate to: - fresh or chilled mutton, lamb and goatmeat (subheading 02.01 A IV a)) of the Common Customs Tariff),

- frozen mutton, lamb and goatmeat (subheading 02.01 A IV b)) of the Common Customs Tariff).

2. Within the terms of this arrangement, the possibilities of export of mutton and lamb and goatmeat from Uruguay to the Community are fixed at the following annual quantity:

5 100 tonnes expressed in carcass weight (1).

In order to ensure the proper functioning of the arrangement, Uruguay undertakes to implement the appropriate procedures to ensure that the annual quantity actually exported does not exceed the quantity agreed and shall be exported in accordance with the traditional patterns of presentation (frozen or chilled).

Should changes in technology and trade make it possible to modify the presentational structure of trade, the two parties to this arrangement will consult each other prior to any such modification in the committee mentioned in clause 10 in order to find an adequate solution.

3. Should the Community have recourse to the safeguard clause, it undertakes that Uruguay's access to the Community as provided for in this arrangement will not be affected.

4. If imports from Uruguay in any one year exceed the quantities agreed, the Community reserves the right to suspend imports from Uruguay for the remainder of that year. The quantity overshipped shall be offset against Uruguay's export entitlement for the following year.

5. The Community undertakes to limit the levy applicable to imports of products covered by the present arrangement to a maximum amount of 10 %, ad valorem. (1)Carcass weight (bone-in equivalent weight). By this term is understood the weight of bone-in meat presented as such as well as boned meat converted by a coefficient into bone-in weight. For this purpose 55 kg of boned mutton corresponds to 100 kg of bone-in mutton and 60 kg of boned lamb corresponds to 100 kg of bone-in lamb.

6. At the time of accession of new Member States, the Community, in consultation with Uruguay, will alter the quantities set out in clause 2, in accordance with Uruguay's trade with each new Member State. The charges applicable to imports for the said new Member State shall be fixed in accordance with the rules in the Treaty of Accession ; the maximum level of the levy specified in clause 5 of this arrangement being taken into account.

The total quantity as mentioned in clause 2 above is fixed at 5 800 tonnes in carcass weight as from the date of accession of Greece to the Community.

7. The Community will endeavour to avoid any market development which could prejudice the marketing of Uruguay's mutton and lamb on the Community market within the limits of the quantities agreed. In particular, the Community will take steps to ensure that the disposal of intervention stocks in frozen form arising from the operation of the regulation does not undermine such marketing of Uruguay's mutton and lamb.

8. In taking account of the objectives and provisions of this arrangement the Community agrees that any actual implementation of refunds of any other form of assistance with respect to exports of mutton, lamb and live sheep and lambs intended for slaughter will apply only at prices and on conditions which comply with existing international obligations and in respect of the traditional shares of the Community of world export trade in these products. These words shall be interpreted in a manner consistent with Article XVI of the General Agreement on tariffs and trade and in particular in conformity with Article 10 (2) (c) of the Agreement on interpretation and application of Articles VI, XVI and XXIII of the General Agreement on tariffs and trade.

9. Uruguay shall ensure that this arrangement is observed, in particular, by issuing export certificates covering the products referred to in clause 1 within the limits of the quantities covered by this arrangement.

For its part, the Community shall undertake to adopt all necessary provisions to make the issue of the import certificates for the products referred to above, originating in Uruguay, subject to the presentation of an export certificate, issued by the competent authority designated by the Uruguay Government.

Detailed rules for applying this system shall be laid down in such a way as to render unnecessary the lodging of a security for the issue of the import certificate in respect of the products in question.

Also, such detailed rules of application shall provide that the competent Uruguay authority shall communicate periodically to the competent authority of the Community the quantities in respect of which export certificates are issued, broken down, where appropriate, according to destination.

10. A Consultative Committee shall be set up composed of representatives from the Community and from Uruguay. The Committee shall ensure that the arrangement is being properly applied and is functioning smoothly. It will examine regularly the trend of the two parties' markets in mutton and lamb and goatmeat and the trend of the international market, as well as marketing conditions on those markets including those relevant to the objective set out in clause 7 of this arrangement.

It will ensure that the proper application of the arrangement is not affected by the export of mutton and lamb and goatmeat-based products to the Community under customs headings not referred to by the arrangement.

The Committee will discuss all questions which could arise in applying the arrangement and will recommend appropriate solutions to the competent authorities.

11. The provisions of this arrangement shall be agreed without prejudice to the parties' rights and obligations under GATT.

12. The annual quantity fixed in clause 2 refers to the period running from 1 January to 31 December. The quantity applicable as of the implementation of the present arrangement and until 1 January of the following year will be fixed on a pro rata basis in relation to the total annual quantity and will take into account the seasonality of the trade.

13. This arrangement shall apply, on the one hand, to the territories in which the Treaty establishing the European Economic Community is applied and under the conditions laid down in that Treaty and, on the other hand, to the territory of the Eastern Republic of Uruguay.

14. The arrangement shall enter into force on 20 October 1980. It shall remain in force until 31 March 1984, and shall continue in force thereafter subject to each party having the right to denounce it by giving one year's notice in writing. In any case the provisions of this arrangement will be examined by the two parties before 1 April 1984 with a view to making any adjustment which they agree is necessary.

I should be obliged if you would kindly confirm the agreement of your Government to the foregoing.

Please accept, Sir, the assurance of my highest consideration.

For the Council of the European Communities

Letter No 2

Sir,

I have the honour to acknowledge receipt of your letter of today's date, which reads as follows:

"I have the honour to refer to the negotiations recently undertaken between our respective delegations for the purpose of drawing up provisions concerning import into the European Economic Community of mutton, lamb and goatmeat from Uruguay in connection with the implementation by the Community of the common organization of the market in sheepmeat and goatmeat.

During these negotiations both parties agreed as follows: 1. This arrangement shall relate to: - fresh or chilled mutton, lamb and goatmeat (subheading 02.01 A IV a)) of the Common Customs Tariff),

- frozen mutton, lamb and goatmeat (subheading 02.01 A IV b)) of the Common Customs Tariff).

2. Within the terms of this arrangement, the possibilities of export of mutton and lamb and goatmeat from Uruguay to the Community are fixed at the following annual quantity:

5 100 tonnes expressed in carcass weight (1).

In order to ensure the proper functioning of the arrangement, Uruguay undertakes to implement the appropriate procedures to ensure that the annual quantity actually exported does not exceed the quantity agreed and shall be exported in accordance with the traditional patterns of presentation (frozen or chilled).

Should changes in technology and trade make it possible to modify the presentational structure of trade, the two parties to this arrangement will consult each other prior to any such modification in the Committee mentioned in clause 10 in order to find an adequate solution.

3. Should the Community have recourse to the safeguard clause, it undertakes that Uruguay's access to the Community as provided for in this arrangement will not be affected.

4. If imports from Uruguay in any one year exceed the quantities agreed, the Community reserves the right to suspend imports from Uruguay for the remainder of that year. The quantity overshipped shall be offset against Uruguay's export entitlement for the following year.

5. The Community undertakes to limit the levy applicable to imports of products covered by the present arrangement to a maximum amount of 10 %, ad valorem. (1)Carcass weight (bone-in equivalent weight). By this term is understood the weight of bone-in meat presented as such as well as boned meat converted by a coefficient into bone-in weight. For this purpose 55 kg of boned mutton corresponds to 100 kg of bone-in mutton and 60 kg of boned lamb corresponds to 100 kg of bone-in lamb.

6. At the time of accession of new Member States, the Community, in consultation with Uruguay, will alter the quantities set out in clause 2, in accordance with Uruguay's trade with each new Member State. The charges applicable to imports for the said new Member States shall be fixed in accordance with the rules in the Treaty of Accession ; the maximum level of the levy specified in clause 5 of this arrangement being taken into account.

The total quantity as mentioned in clause 2 above is fixed at 5 800 tonnes in carcass weight as from the date of accession of Greece to the Community.

7. The Community will endeavour to avoid any market development which could prejudice the marketing of Uruguay's mutton and lamb on the Community market within the limits of the quantities agreed. In particular, the Community will take steps to ensure that the disposal of intervention stocks in frozen form arising from the operation of the regulation does not undermine such marketing of Uruguay's mutton and lamb.

8. In taking account of the objectives and provisions of this arrangement the Community agrees that any actual implementation of refunds or any other form of assistance with respect to exports of mutton, lamb and live sheep and lambs intended for slaughter will apply only at prices and on conditions which comply with existing international obligations and in respect of the traditional shares of the Community of world export trade in these products. These words shall be interpreted in a manner consistent with Article XVI of the General Agreement on tariffs and trade and in particular in conformity with Article 10 (2) (c) of the Agreement on interpretation and application of Articles VI, XVI and XXIII of the General Agreement on tariffs and trade.

9. Uruguay shall ensure that this arrangement is observed, in particular, by issuing export certificates covering the products referred to in clause 1 within the limits of the quantities covered by this arrangement.

For its part, the Community shall undertake to adopt all necessary provisions to make the issue of the import certificates for the products referred to above, originating in Uruguay, subject to the presentation of an export certificate, issued by the competent authority designated by the Uruguay Government.

Detailed rules for applying this system shall be laid down in such a way as to render unnecessary the lodging of a security for the issue of the import certificate in respect of the products in question.

Also, such detailed rules of application shall provide that the competent Uruguay authority shall communicate periodically to the competent authority of the Community the quantities in respect of which export certificates are issued, broken down, where appropriate, according to destination.

10. A Consultative Committee shall be set up composed of representatives from the Community and from Uruguay. The Committee shall ensure that the arrangement is being properly applied and is functioning smoothly. It will examine regularly the trend of the two parties' markets in mutton and lamb and goatmeat and the trend of the international market, as well as marketing conditions on those markets including those relevant to the objective set out in clause 7 of this arrangement.

It will ensure that the proper application of the arrangement is not affected by the export of mutton and lamb and goatmeat-based products to the Community under customs headings not referred to by the arrangement.