ADDITIONAL PROTOCOL to the Agreement between the European Economic Community and the Republic of Iceland consequent on the accession of the Kingdom of Spain and the Portuguese Republic to the Community

THE EUROPEAN ECONOMIC COMMUNITY,

of the one part, and

THE REPUBLIC OF ICELAND,

of the other part,

HAVING REGARD to the Agreement between the European Economic Community and the Republic of Iceland signed in Brussels on 22 July 1972, hereinafter called the 'Agreement',

HAVING REGARD to the accession of the Kingdom of Spain and the Portuguese Republic to the European Communities on 1 January 1986,

CONSIDERING that, on 19 December 1985, for the period 1 January 1986 to 28 February 1986, the Community and the Republic of Iceland had agreed upon the arrangements applicable to trade between Iceland, on the one hand, and Spain and Portugal, on the other,

HAVE DECIDED to determine by common accord the adjustments and transitional measures to the Agreement consequent on the accession of the Kingdom of Spain and the Portuguese Republic to the European Economic Community, and

TO CONCLUDE THIS PROTOCOL:

TITLE I

Adjustments

Article 1

The Agreement, the Annexes and Protocols, which form an integral part thereof, the Final Act and the declarations annexed thereto shall be drawn up in the Spanish and Portuguese languages and those texts shall be authentic in the same way as the original texts. The Joint Committee shall approve the Spanish and Portuguese texts.

Article 2

Products covered by the Agreement and originating in Iceland, when imported into the Canary Islands, Ceuta or Melilla, shall enjoy in all respects the same customs regime as that which is applied to products originating in

the customs territory of the Community, including the

arbitrio insular charge applied in the Canary Islands.

The Republic of Iceland shall grant to imports of products covered by the Agreement and originating in the Canary Islands, Ceuta or Melilla the same customs regime as that which is granted to products imported from and orig-

inating in Spain.

TITLE II

Transitional measures concerning Spain, on the one hand, and Iceland, on the other

Article 3

1. For the products covered by the Agreement and subject to the provisions of Articles 4a and 5, the customs duties on imports between Iceland and Spain applicable to

products originating in those countries shall be progressively abolished in accordance with the following timetable:

-on 1 March 1986, each duty shall be reduced to 90,0 % of the basic duty,

-on 1 January 1987, each duty shall be reduced to 77,5 % of the basic duty,

-on 1 January 1988, each duty shall be reduced to 62,5 % of the basic duty,

-on 1 January 1989, each duty shall be reduced to 47,5 % of the basic duty,

-on 1 January 1990, each duty shall be reduced to 35,0 % of the basic duty,

-on 1 January 1991, each duty shall be reduced to 22,5 % of the basic duty,

-on 1 January 1992, each duty shall be reduced to 10,0 % of the basic duty,

-the last reduction of 10 % shall be made on 1 January 1993.

2. The rate of the duties calculated in accordance with paragraph 1 shall be applied by rounding down to the first decimal place by deleting the second decimal.

Article 4

1. Subject to the provisions of the following three paragraphs, the basic duty to which the successive reductions provided for in Article 3 are to be applied shall, for each product, be the duty actually applied on 1 January 1985 in trade between Iceland and Spain.

2. However, if after that date and before accession a tariff reduction has been applied, such reduced duty shall be considered as a basic duty.

3. For the products listed in Annex I, the basic duty applied by Spain shall be that indicated against each product.

4. For crude petroleum oils or oils obtained from bituminous minerals falling within heading N° 27.09 of the Common Customs Tariff the basic duty applied by Spain shall be nil.

Article 4a

For the products covered by Protocol N° 6 of the Agreement, the Kingdom of Spain shall abolish in accordance with the timetable indicated in Annex Ia the difference between

(a) the basic duty actually applied by the Kingdom of Spain on 1 January 1985 on imports of those products originating in Iceland and

(b) the duty referred to in Protocol N° 6 of the Agreement, applicable by the Community to the same products imported from and originating in Iceland.

Article 5

1. The variable component which the Kingdom of Spain may apply in accordance with Article 1 of Protocol N° 2 to the Agreement to certain products listed in Table I of that Protocol, originating in Iceland, shall be adjusted by the compensatory amount applied in trade between the Community as constituted on 31 December 1985 and Spain.

2. For the products listed in Table I of Protocol N° 2 to the Agreement, the Kingdom of Spain shall abolish, in accordance with the timetable laid down in Article 3, the difference between:

-the basic duty to be applied by Spain in accordance with Article 4,

and

-the duty (other than the variable component) indicated in the last column of Table I of Protocol N° 2.

3. For the products listed in Table II of Protocol N° 2 to the Agreement, the Republic of Iceland shall abolish, in accordance with the timetable laid down in Article 3, the difference between:

-the basic duty to be applied by Iceland in accordance with Article 4,

and

-the duty (other than the variable component) indicated in the last column of Table II of Protocol N° 2.

Article 6

If the Kingdom of Spain suspends in whole or in part the levying of the customs duties applicable to products imported from the Community as constituted on

31 December 1985, it shall also suspend or reduce, by the same percentage, the customs duties on imports applicable to products originating in Iceland.

Article 7

1. If the Kingdom of Spain opens to third countries tariff quotas actually applied on 1 January 1985, products imported from Iceland shall be subject to the same treatment as products imported from the Community as constituted on 31 December 1985, whilst such quotas remain open.

2. If tariff quotas are not opened, the Kingdom of Spain shall apply to products imported from Iceland the duties applied in the case of such quotas being opened. The quantities or value subject to these duties shall be limited to the amounts actually imported from Iceland under the same quotas opened on 1 January 1985.

Article 8

1. If the Kingdom of Spain applies quantitative restrictions on imports from the Community as constituted on 31 December 1985:

-until 31 December 1988, of the products referred to in Annex II,

-until 31 December 1989, of the products referred to in Annex III,

it shall also apply quantitative restrictions on the same products originating in Iceland.

2. The quantitative restrictions referred to above shall take the form of global quotas which are also opened for imports originating in the other EFTA countries.

The initial global quotas for 1986 are listed in Annexes II and III, respectively.

3. The rate of progressive increase for quotas referred to in Annex II and for quotas 1 to 5 and 10 to 14 referred to in Annex III shall be 25 % at the beginning of each year for quotas expressed in ECU and 20 % at the beginning of each year for quotas expressed in terms of volume. The increase shall be added to each quota and the next increase calculated on the basis of the total thus obtained.

For the quotas 6 to 9 listed in Annex III; the annual rate of progressive increase shall be as follows:

-first year: 13 %,

-second year: 18 %,

-third year: 20 %,

-fourth year: 20 %.

4. Where it is found that imports into Spain of a product listed in Annex II or III have for two consecutive years been less than 90 % of the quota, the Kingdom of Spain shall, from the beginning of the year following those two years, liberalize imports of that product originating in Iceland or in other countries referred to in paragraph 2, if the product is liberalized at that time in respect of the Community as constituted on 31 December 1985.

5. If the Kingdom of Spain liberalizes imports of a product listed in Annex II or III coming from the Community as constituted on 31 December 1985 or increases a quota beyond the minimum rate applicable to the Com-

munity as constituted on the abovementioned date, it

shall also liberalize imports of that product originating in Iceland or increase the global quota proportionately.

6. For the administration of the abovementioned quotas, the Kingdom of Spain shall apply the same administrative rules and procedures as those applied to imports of such products originating in the Community as constituted on 31 December 1985.

Article 8a

By way of derogation from Article 13 of the Agreement, and up to 31 December 1992, imports of certain fishery products referred to in Article 1 of Protocol 6 originating in Iceland and imported into the Kingdom of Spain and listed in Annex IIIa, shall be the subject of quantitative restrictions.

These restrictions shall apply within the limits and under the conditions set out below. The basic quantities for 1986 shall be those listed in Annex IIIa.

These quotas shall be the subject of management by 3-monthly periods.

For the period from 1 January 1987 to 31 December 1992 the basic annual quotas to be fixed shall at least equal the quantities referred to above.

Imports into the Community of these products may benefit from the preferential rate only on condition that

the free-at-frontier price for the products concerned,

ascertained by the Member States in accordance with

Article 21 of Regulation (EEC) N° 3796/81, is at least equal to the reference price fixed by the Community for the products or categories of product concerned.

For a five-year period, imports into Spain of products falling under Common Customs Tariff heading N° 15.04 shall be subject to quantitative restrictions.

TITLE III

Transitional measures concerning Portugal, on the one hand, and Iceland, on the other

Article 9

1. For the products covered by the Agreement and subject to the provisions of Articles 10a and 12, the customs duties on imports into Portugal applicable to products originating in Iceland shall be progressively abolished in accordance with the following timetable:

-on 1 March 1986, each duty shall be reduced to 90 % of the basic duty,

-on 1 January 1987, each duty shall be reduced to 80 % of the basic duty,

-on 1 January 1988, each duty shall be reduced to 65 % of the basic duty,

-on 1 January 1989, each duty shall be reduced to 50 % of the basic duty,

-on 1 January 1990, each duty shall be reduced to 40 % of the basic duty,

-on 1 January 1991, each duty shall be reduced to 30 % of the basic duty,

-the other two reductions of 15 % each shall be made on 1 January 1992 and 1 January 1993, respectively.

2. The rate of duties calculated in accordance with paragraph 1 shall be applied by rounding down to the first decimal place by deleting the second decimal.

Article 10

1. Subject to the provisions of the following three paragraphs, the basic duty to which the successive reductions

provided for in Article 9, are to be applied shall, for each product, be the duty actually applied by the Portuguese Republic on 1 January 1985 in trade with Iceland.

2. However, if after that date and before accession a tariff reduction has been applied, such reduced duty shall be considered as a basic duty.

3. For the products listed in Annex IV, the basic duty applied by Portugal shall be that indicated against each product.

4. For the products listed in Annex V, as well as for matches and tinder, the basic duties shall be those indicated in the said Annex.

Article 10a

For the products covered by Protocol N° 6 of the Agreement, the Republic of Portugal shall abolish, in accordance with the timetable indicate in Annex VII, the difference between:

(a) the basic duty actually applied by the Portuguese Republic on 1 January 1985 on imports of those products originating in Iceland or, in the case where it was higher, the duty applied on imports of the same products imported from the Community,

and

(b) the duty referred to in Protocol N° 6 of the Agreement applicable by the Community to the same products imported from and originating in Iceland.

Article 11

1. The following charges applied by Portugal in trade with Iceland shall be progressively abolished in accordance with the following timetable:

(a)the ad valorem charge of 0,4 % applied to goods imported temporarily, goods reimported (excluding containers) and goods imported under the inward processing arrangements characterized by the rebate of duties levied on the import of goods used after export of the products obtained (drawback) shall be reduced to 0,2 % on 1 January 1987 and abolished on

1 January 1988;

(b) the ad valorem charge of 0,9 % applied to goods imported for home use shall be reduced to 0,6 % on

1 January 1989, reduced to 0,3 % on 1 January 1990 and abolished on 1 January 1991.

2. The Portuguese Republic shall progressively abolish for liquorice extract containing more than 10 % by weight of sucrose but not containing other added substances, falling

within subheading 17.04 A of the Common Customs Tariff, the fiscal element of Esc 5 per in accordance with the timetable laid down in Article 9.

Article 12

1. The variable component which the Portuguese

Republic may apply in accordance with Article 1 of

Protocol N° 2 to the Agreement to certain products listed

in Table I of that Protocol, originating in Iceland, shall be adjusted by the compensatory amount applied in trade between the Community as constituted on 31 December 1985 and Portugal.

2. For the products listed in Table I of Protocol N° 2 to the Agreement, the Portuguese Republic shall abolish, in accordance with the timetable laid down in Article 9, the difference between:

-the basic duty to be applied by Portugal in accordance with Article 10,

and

-the duty (other than the variable component) indicated in the last column of Table I of Protocol N° 2.

3. In all cases where a minimum duty (fixed component) is applied in respect of the Community, as indicated in Annex VI, the same minimum duty shall be applied to Iceland if the calculation resulting from the breakdown in respect of Iceland results in a level of duty lower than the minimum duty applied in respect of the Community.

4. For the products listed in Table II of Protocol N° 2 to the Agreement, the Republic of Iceland shall abolish, in accordance with the timetable laid down in Article 9, the difference between:

-the customs duties actually applied by the Republic of Iceland on 1 January 1985,

and

-the duty (other than the variable component) indicated in the last column of Table II of Protocol N° 2.

Article 13

If the Portuguese Republic suspends in whole or in part the levying of customs duties and/or charges referred to in Article 11 on products imported from the Community as constituted on 31 December 1985, it shall also suspend or reduce, by the same percentage, those duties and/or charges applicable to products originating in Iceland.

Article 14

1. The Portuguese Republic will maintain until

31 December 1987 quantitative restrictions on imports of motor vehicles within the limits of a system of import quotas.

2. If the Portuguese Republic liberalizes imports of the motor vehicles concerned coming from the Community as constituted on 31 December 1985, or increases a quota beyond the level of that applicable to the Community as constituted on the abovementioned date, it shall also liberalize the imports in question originating in Iceland or increase the quota for that country proportionately.

Article 14a

By way of derogation from Article 13 of the Agreement and up to 31 December 1992, imports of certain fishery

products referred to in Article 1 of Protocol N° 6 originating in Iceland and imported into the Portuguese Republic, and listed in Annex IIIa, shall be the subject of quantitative restrictions.

These restrictions shall apply within the limits and under the conditions set out below. The basic quantities for 1986 shall be those listed in Annex IIIa.

These quotas shall be the subject of management by 3-monthly periods.

For the period from 1 January 1987 to 31 December 1992 the basic annual quotas to be fixed shall at least equal the quantities referred to above.

Imports into the Community of these products may benefit from the preferential rate only on condition that the free-at-frontier price for the products concerned,

ascertained by the Member States in accordance with

Article 21 of Regulation (EEC) N° 3796/81, is at least equal to the reference price fixed by the Community for the products or categories of product concerned.

For a five-year period imports into Portugal of products falling under heading N° 15.04 of the Common Customs Tariff shall be subject to quantitative restrictions.

Article 15

The Portuguese Republic shall abolish the discriminating variation existing between the rate of reimbursement by the

social security institutions for pharmaceutical products imported from Iceland in three annual stages of equal size occurring on the following dates:

-1 January 1987,

-1 January 1988,

-1 January 1989.

TITLE IV

General and final provisions

Article 16

The Joint Committee shall make any amendments which may be necessary to the origin rules consequent on the accession of the Kingdom of Spain and the Portuguese Republic to the European Communities.

Article 17

The Annexes to this Protocol form an integral part thereof. This Protocol forms an integral part of the Agreement.

Article 18

This Protocol shall be approved by the Contracting Parties in accordance with their own procedures. It shall enter into force on 1 March 1986, provided that the Contracting Parties have notified each other before that date that the procedures necessary to this end have been completed. After that date, the Protocol shall enter into force on the first day of the second month following such notification.

Article 19

This Protocol is drawn up in duplicate, in the Danish, Dutch, English, French, German, Greek, Italian,

Portuguese, Spanish and Icelandic languages, each of

these texts being equally authentic.

Hecho en Bruselas, el catorce de julio de mil novecientos ochenta y seis.

Udfærdiget i Bruxelles, den fjortende juli nitten hundrede og seksogfirs.

Geschehen zu Brüssel am vierzehnten Juli neunzehnhundertsechsundachtzig.

¸ãéíå óôéò ÂñõîÝëëåò, óôéò äåêáôÝóóåñéò Éïõëßïõ ÷ßëéá åííéáêüóéá ïãäüíôá Ýîé.

Done at Brussels on the fourteenth day of July in the year one thousand nine hundred and eighty-six.

Fait à Bruxelles, le quatorze juillet mil neuf cent quatre-vingt-six.

Gedaan te Brussel, de veertiende juli negentienhonderd zesentachtig.

Feito em Bruxelas, em catorze de Julho de mil novecentos e oitenta e seis.

Gjört í Brussel fjórtánda dag júlí ári Fo nítján hundru Fo áttatíu og sex.

Por la Comunidad Económica Europea

For Det europæiske økonomiske Fællesskab

Für die Europäische Wirtschaftsgemeinschaft

Ãéá ôçí ÅõñùðáúêÞ ÏéêïíïìéêÞ Êïéíüôçôá

For the European Economic Community

Pour la Communauté économique européenne

Per la Comunità economica europea

Voor de Europese Economische Gemeenschap

Pela Comunidade Económica Europeia

Fyrir Efnahagsbandalag Evrópu

Por la República de Islandia

For republikken Island

Für die Republik Island

Ãéá ôç Äçìïêñáôßá ôçò Éóëáíäßáò

For the Republic of Iceland

Pour la république d'Islande

Per la Repubblica d'Islanda

Voor de Republiek Ijsland

Pela República da Islãndia

Fyrir L´yõveldi Fo Ísland

ANNEX I SPANISH BASIC DUTY (FIXED COMPONENT) ON 1 JANUARY 1986(1)

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ANNEX Ia

The customs duties applicable to imports into Spain of the following products originating in Iceland shall be changed to the following levels, in accordance with the reference prices applicable:

I

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II

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The customs duties applicable to imports into Spain of the following products originating in Iceland shall be changed to in following levels:

É

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ÉÉ

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ANNEX II BASIC QUOTAS FOR PRODUCTS SUBJECT TO QUANTITATIVE RESTRICTIONS ON IMPORTS INTO SPAIN UNTIL 31 DECEMBER 1988

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ANNEX III BASIC QUOTAS FOR PRODUCTS SUBJECT TO QUANTITATIVE RESTRICTIONS ON IMPORTS INTO SPAIN UNTIL 31 DECEMBER 1989

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ANNEX IIIa Quantities in tonnes

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ANNEX IV PORTUGUESE BASIC DUTY (FIXED COMPONENT) ON 1 JANUARY 1986(1)

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ANNEX V DEFINITION OF PORTUGUESE BASIC DUTIES FOR CERTAIN PRODUCTS

For the products mentioned below, the basic duties on which the Portuguese Republic shall effect the successive reductions provided for in Article 9 shall be those indicated opposite each of them:

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In respect of matches falling within heading N° 36.06 and tinder falling within subheading ex 36.08 B of the Common Customs Tariff, coming from Iceland, the basic duty shall be zero.

ANNEX VI

1.PRODUCTS FOR WHICH THE MINIMUM DUTIES (FIXED COMPONENT) ARE FIXED AT 35 % FOR IMPORTS COMING FROM THE COMMUNITY AS CONSTITUTED ON 31 DECEMBER 1985

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2.PRODUCTS FOR WHICH THE MINIMUM DUTIES (FIXED COMPONENT) ARE FIXED AT 14 % FOR IMPORTS COMING FROM THE COMMUNITY AS CONSTITUTED ON 31 DECEMBER 1985

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3.PRODUCTS FOR WHICH THE MINIMUM DUTIES (FIXED COMPONENT) ARE FIXED AT 12 % FOR IMPORTS COMING FROM THE COMMUNITY AS CONSTITUTED ON 31 DECEMBER 1985

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4.PRODUCTS FOR WHICH THE MINIMUM DUTIES (FIXED COMPONENT) ARE FIXED AT 11 % FOR IMPORTS COMING FROM THE COMMUNITY AS CONSTITUTED ON 31 DECEMBER 1985

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ANNEX VII

The customs duties applicable to imports into Portugal of the following products originating in Iceland shall be changed, in accordance with the reference prices applicable, to the following levels:

I

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The customs duties applicable to imports into Portugal of the following products originating in Iceland shall be changed to the following levels:

I

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II

(Articles 289 (2) (a) and 260 of the Accession Treaty)

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III

(Articles 289 (2) (b) and 260 of the Accession Treaty)

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Declaration by the European Economic Community

The Community recalls that, when it decided to apply the provisions of Protocol N° 6 of the Agreement between the European Economic Community and the Republic of Iceland, from 1 July 1976, it addressed, on 23 June 1976, a letter to the Government of the Republic of Iceland, clarifying the conditions under which it took this decision.

On the occasion of the extension of the Agreement to Spain and Portugal, the Community renews the terms of that letter.

Declaration by the Government of the Republic of Iceland

The Icelandic Government takes note of the Declaration of the European Economic Community concerning the interpretation of the letter of the President of the Council, dated 23 June 1976, regarding the application of Protocol N° 6 to the Agreement between the Republic of Iceland and the European Economic Community. The Icelandic Government does not consider that this letter contains any reservation regarding the implementation of the said Protocol, although the hope is expressed that negotiations with Iceland on the more general problem of fishing limits will be started in the near future and concluded on a durable basis satisfactory to the two sides.