*****

AGREEMENT

in the form of exchanges of letters adjusting the Agreement between the European Economic Community and the Eastern Republic of Uruguay on trade in mutton and lamb

A

Letter No 1

Sir,

I have the honour to refer to the exchange of letters of 14 October 1980 constituting an Agreement between the European Community and Uruguay establishing provisions relating to import of mutton and lamb into the Community from Uruguay 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 in order to achieve a unified 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 5 800 tonnes shall be replaced by the figure of 5 220 tonnes. This ceiling shall include a maximum in 1989 of 2 000 metric tonnes of lamb imported into the European Community from Uruguay in a form which has never been frozen, a maximum of 2 200 metric tonnes in 1990, a maximum of 2 400 metric tonnes in 1991, and a maximum of 2 600 metric 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 Uruguay 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 Uruguay 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 an Agreement between the European Economic Community and Uruguay on the matter.

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

For the

Council of the European Communities

Rolf MOEHLER

ANNEX

Price surveillance procedure

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

2. The relationship between the prices for imported frozen lamb carcases from Uruguay 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. The factors that will be taken into account by the Parties in such consultations shall include traditional and seasonal price relationships and fluctuations, the prices of cuts, the impact of prices of other meats, and other exceptional factors.

1.2 // // // Member States by region // Benchmark levels for the relationship between prices of imported frozen lamb carcases and prices of domestically produced lamb // // // Northern Member States (Belgium, Denmark, Federal Republic of Germany, France, Ireland, Luxembourg, Netherlands, United Kingdom) // 55 % // Southern Member States (Greece, Italy, Portugal, Spain) // 45 % // //

3. Should the downward movement of the relationship between prices for Uruguayan frozen lamb carcases and Community-produced lamb below the benchmark levels in the particular Member States under consideration pose 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 Uruguayan frozen lamb carcases are being sold in those Member States by Uruguayan exporters, then Uruguay shall take whatever 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 cause 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 Uruguayan Minister of Agriculture for resolution.

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

Letter No 2

Sir,

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

'I have a honour to refer to the exchange of letters of 14 October 1980 consituting an Agreement between the European Community and Uruguay establishing provisions relating to import of mutton and lamb into the Community from Uruguay 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 in order to achieve a unified 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 5 800 tonnes shall be replaced by the figure of 5 220 tonnes. This ceiling shall include a maximum in 1989 of 2 000 metric tonnes of lamb imported into the European Community from Uruguay in a form which has never been frozen, a maximum of 2 200 metric tonnes in 1990, a maximum of 2 400 metric tonnes in 1991, and a maximum of 2 600 metric 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 Uruguay 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 Uruguay 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 an Agreement between the European Economic Community and Uruguay 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 Uruguay

José María ARANEO

ANNEX

Price surveillance procedure

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

2. The relationship between the prices for imported frozen lamb carcases from Uruguay in each Member State and the market prices for Communty-produced lamb in each such Member State will be compared with the benchmark level specified below for each 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. The factors that will be taken into account by the Parties in such consultations shall include traditional and seasonal price relationships and fluctuations, the prices of cuts, the impact of prices of other meats, and other exceptional factors.

1.2 // // // Member States by region // Benchmarl levels for the relationship between prices of imported frozen lamb carcases and prices of domestically produced lamb // // // Northern Member States (Belgium, Denmark, Federal Republic of Germany, France, Ireland, Luxembourg, Netherlands, United Kingdom) // 55 % // Southern Member States (Greece, Italy, Portugal, Spain) // 45 % // //

3. Should the downward movement of the relationship between prices for Uruguayan frozen lamb carcases and Community-produced lamb below the benchmark levels in the particular Member States under consideration pose 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 Uruguayan frozen lamb carcases are being sold in those Member States by Uruguayan exporters, then Urugauy shall take whatever action is availables 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 consulations 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 Uruguayan Minister of Agriculture for resolution.

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

B

Letter No 1

Brussels, 23 February 1990

Sir,

I have the honour to refer to clause 1 of the exchange of letters dated 23 February 1990 relating to the 1980 Agreement between the European Community and Uruguay on trade in mutton and lamb.

I also have the honour to confirm that before 31 December 1990, in addition to the ceiling of 5 220 metric tonnes, a quantity of 1 700 tonnes may be delivered. This additional volume shall be deemed to include a maximum of 500 metric tonnes of lamb imported into the European Community from Uruguay in a form which has never been frozen.

I should be obliged if you would kindly acknowledge receipt of this letter.

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

For the

Council of the European Communities

Rolf MOEHLER

Letter No 2

Brussels, 23 February 1990

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 clause 1 of the exchange of letters dated 23 February 1990 relating to the 1980 Agreement between the European Community and Uruguay on trade in mutton and lamb.

I also have the honour to confirm that before 31 December 1990, in addition to the ceiling of 5 220 metric tonnes, a quantity of 1 700 tonnes may be delivered. This additional volume shall be deemed to include a maximum of 500 metric tonnes of lamb imported into the European Community from Uruguay in a form which has never been frozen.

I should be obliged if you would kindly acknowledge receipt of this letter.'

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

For the Government of Uruguay

José María ARANEO