AGREEMENT in the form of an Exchange of Letters adapting the Agreement between the European Community and Argentina on trade in mutton, lamb and goatmeat

A. Letter N° 1

Sir . . . . . .,

I have the honour to refer to the Exchange of Letters of 14 October 1980 constituting an Agreement between the Community and Argentina establishing provisions relating to import of mutton and lamb and goatmeat into the Community from Argentina and to negotiations held between our respective delegations for the purpose of establishing temporary derogations from certain of those provisions concurrent with the implementation of measures to stabilize the European Community sheepmeat sector and to reform the European Community's internal regime in order to achieve a unified European Community sheepmeat market. Accordingly, they have agreed on the following derogations from the Principal Agreement which shall remain in force for the duration of this Agreement.

Clause 1

A. Access and quantity

In Clause 2 of the Principal Agreement as modified by Clause 6 of the Principal Agreement, the ceiling figure of 23 000 tonnes representing the annual ceiling in metric tonnes on the total quantity of imports each year into the European Community of mutton, lamb and goatmeat from Argentina, shall be deemed to have been replaced by the figure of 19 000 tonnes. This ceiling shall be deemed to include a maximum in 1989 of 1 000 tonnes of lamb imported into the European Community from Argentina in a form which has never been frozen, a maximum of 1 200 tonnes in 1990, a maximum of 1 400 tonnes in 1991, and a maximum of 1 600 tonnes in 1992.

B. Tariff

In Clause 5 of the Principal Agreement, the words 'a maximum amount of 10 %, ad valorem' shall be deemed to be replaced by the word 'zero'.

C. Price surveillance

With a view to improved sheepmeat prices within the European Community, prices for lamb imported from Argentina will be monitored in accordance with the procedures contained in the Annex to this Agreement.

Clause 2

Consultation

Notwithstanding Clause 1 (C) of this Agreement either Party may request consultations concerning the operation of this Agreement at any time.

Clause 3

GATT obligations

The provisions of this Agreement shall be agreed without prejudice to the rights of Argentina and the European Community under GATT.

Clause 4

This Agreement shall enter into force on 1 January 1989 and shall remain in force until 31 December 1992.

Clause 5

Within six months prior to expiration of this Agreement, its provisions shall be reviewed.

I have the honour to propose that, if the foregoing is acceptable to your Government, this letter and your confirmatory reply shall together constitute and evidence an Agreement between the European Economic Community and Argentina on the matter.

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

On behalf of

the Council of the European Communities

ANNEX

Price surveillance procedure

1. The European Community will monitor the prices in each Member State for imported frozen lamb carcases from Argentina on the basis of the average prices over each monthly period.

2. The relationship between the prices for imported frozen lamb carcases from Argentina in each Member State and the market prices for Community-produced lamb in each such Member State will be compared with the benchmark level specified below for each such Member State. If this comparison indicates that the price relationship has, in two Member States in the same month, moved below the benchmark levels for those Member States, technical consultations will take place at the request of either Party to determine factors causing the downward movement.

>TABLE>

3. In the event that the downward movement of the relationship between prices for Argentinian frozen lamb carcases and Community-produced lamb below the benchmark levels in the particular Member States under consideration and their remaining at such low levels is indicative of a problem, the Parties shall consider any recommendations arising out of the technical consultations for the resolution of the problem. If the problem identified is attributable to the prices at which Argentinian frozen lamb carcases are being sold in those Member States by Argentinian exporters then Argentina would take what action is available to it to restore the price relationship between frozen lamb carcases and Community-produced lamb in those Member States to the benchmark levels.

4. Should the Parties in the technical consultations fail to reach agreement on appropriate measures to resolve the problem, the Consultative Committee established under Clause 10 of the Principal Agreement may be convened at a senior policy level at the request of either Party to give the matter urgent consideration.

If agreement cannot be reached at official level, the matter may be referred by either party to the EC Commissioner for Agriculture and the Argentinian Minister of Agriculture for resolution.

5. Argentina and the European Community adopt as targets for achievement by the end of 1992 an improvement in the previously defined benchmark levels for Northern Member States by 5 percentage points and for Southern Member States by 8 percentage points.

B. Letter N° 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 Exchange of Letters of 14 October 1980 constituting an Agreement between the Community and Argentina establishing provisions relating to import of mutton and lamb and goatmeat into the Community from Argentina and to negotiations held between our respective delegations for the purpose of establishing temporary derogations from certain of those provisions concurrent with the implementation of measures to stabilize the European Community sheepmeat sector and to reform the European Community's internal regime in order to achieve a unified European Community sheepmeat market. Accordingly, they have agreed on the following derogations from the Principal Agreement which shall remain in force for the duration of this Agreement.

Clause 1

A. Access and quantity

In Clause 2 of the Principal Agreement as modified by Clause 6 of the Principal Agreement, the ceiling figure of 23 000 tonnes representing the annual ceiling in metric tonnes on the total quantity of imports each year into the European Community of mutton, lamb and goatmeat from Argentina, shall be deemed to have been replaced by the figure of 19 000 tonnes. This ceiling shall be deemed to include a maximum in 1989 of 1 000 tonnes of lamb imported into the European Community from Argentina in a form which has never been frozen, a maximum of 1 200 tonnes in 1990, a maximum of 1 400 tonnes in 1991, and a maximum of 1 600 tonnes in 1992.

B. Tariff

In Clause 5 of the Principal Agreement, the words 'a maximum amount of 10 %, ad valorem' shall be deemed to be replaced by the word 'zero'.

C. Price surveillance

With a view to improved sheepmeat prices within the European Community, prices for lamb imported from Argentina will be monitored in accordance with the procedures contained in the Annex to this Agreement.

Clause 2

Consultation

Notwithstanding Clause 1 (C) of this Agreement either Party may request consultations concerning the operation of this Agreement at any time.

Clause 3

GATT obligations

The provisions of this Agreement shall be agreed without prejudice to the rights of Argentina and the European Community under GATT.

Clause 4

This Agreement shall enter into force on 1 January 1989 and shall remain in force until 31 December 1992.

Clause 5

Within six months prior to expiration of this Agreement, its provisions shall be reviewed.

I have the honour to propose that, if the foregoing is acceptable to your Government, this letter and your confirmatory reply shall together constitute and evidence an Agreement between the European Economic Community and Argentina on the matter.'

I have the honour to confirm the foregoing is acceptable to my Government and that your letter together with this reply shall constitute an Agreement in accordance with your proposal.

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

For the Government of Argentina

ANNEX

Price surveillance procedure

1. The European Community will monitor the prices in each Member State for imported frozen lamb carcases from Argentina on the basis of the average prices over each monthly period.

2. The relationship between the prices for imported frozen lamb carcases from Argentina in each Member State and the market prices for Community-produced lamb in each such Member State will be compared with the benchmark level specified below for each such Member State. If this comparison indicates that the price relationship has, in two Member States in the same month, moved below the benchmark levels for those Member States, technical consultations will take place at the request of either Party to determine factors causing the downward movement.

>TABLE>

3. In the event that the downward movement of the relationship between prices for Argentinian frozen lamb carcases and Community-produced lamb below the benchmark levels in the particular Member States under consideration and their remaining at such low levels is indicative of a problem, the Parties shall consider any recommendations arising out of the technical consultations for the resolution of the problem. If the problem identified is attributable to the prices at which Argentinian frozen lamb carcases are being sold in those Member States by Argentinian exporters then Argentina would take what action is available to it to restore the price relationship between frozen lamb carcases and Community-produced lamb in those Member States to the benchmark levels.

4. Should the Parties in the technical consultations fail to reach agreement on appropriate measures to resolve the problem, the Consultative Committee established under Clause 10 of the Principal Agreement may be convened at a senior policy level at the request of either Party to give the matter urgent consideration.

If agreement cannot be reached at official level, the matter may be referred by either party to the EC Commissioner for Agriculture and the Argentinian Minister of Agriculture for resolution.

5. Argentina and the European Community adopt as targets for achievement by the end of 1992 an improvement in the previously defined benchmark levels for Northern Member States by 5 percentage points and for Southern Member States by 8 percentage points.