Agreement

between the European Community and the Republic of Serbia on trade in textile products

THE EUROPEAN COMMUNITY, hereinafter referred to as "the Community",

of the one part,

and

THE REPUBLIC OF SERBIA, hereinafter referred to as "Serbia",

of the other part,

DESIRING to promote, with a view to permanent cooperation and in conditions providing every security for trade, the orderly and equitable development of trade in textile products between the Community and Serbia (hereinafter referred to together as Parties), as a further step towards deeper trade and political relations including substantial trade liberalisation between the two Parties in the framework of the Stabilisation and Association process;

CONSIDERING that United Nations Security Council Resolution 1244 (1999) established an international civil presence in order to provide an interim administration for Kosovo (United Nations Interim Administration Mission in Kosovo), and it is not possible at this time to apply the obligations undertaken in this Agreement in Kosovo,

HAVE AGREED AS FOLLOWS:

Article 1

This Agreement establishes the regime applicable to trade of textile products originating in the Community and in Serbia listed in Annex I.

TITLE I

BASIC PROVISIONS

Article 2

The Parties agree that:

1. the rates of customs duties applicable in Serbia to textile products originating in the Community shall be dismantled according to the schedule in Annex II;

2. the Community will continue to grant duty free treatment to textile products originating in Serbia in accordance with the applicable Community legislation.

Article 3

1. Quantitative restrictions on imports of textile products listed in Annex I into Serbia of goods originating in the Community and measures having equivalent effect, including non-tariff barriers as specified, in particular, in Annex III, shall not be maintained nor introduced from the date of application of this Agreement except as provided under Articles 5 and 7.

2. Without prejudice to Article 4(1), quantitative restrictions on imports of textile products listed in Annex I into the Community of goods originating in Serbia shall be suspended. Measures having equivalent effect, including non-tariff barriers as specified, in particular, in Annex III, shall not be maintained nor introduced from the date of application of this Agreement, except as provided for under Articles 5, 6 and 7.

Article 4

1. The Community will suspend the quantitative restrictions currently in force for categories listed in Annex IV, as soon as Serbia notifies to the Community that it has implemented its commitments under Article 2(1).

2. Title II lays down the arrangements applicable to quantitative restrictions and the surveillance regime.

Article 5

1. Either Party retains the right to suspend its obligations in Articles 2, 3 and in Article 4(1) should the other Party fail to fulfil its obligations.

2. If the Community re-introduces quantitative restrictions, they shall be established at the year 2004 levels, increased by annual growth rates as last applied for that year.

3. The Parties agree to consult with each other before exercising their rights, in accordance with Article 8.

Article 6

1. With a view to ensuring the effective functioning of this Agreement, the Parties agree to cooperate fully in order to prevent, to investigate and to take any necessary legal and/or administrative action against circumvention by transhipment, re-routing, false declaration concerning the country or place of origin, falsification of documents, false declaration concerning fibre content, quantities, description or classification of merchandise and by whatever other means. Accordingly, the Parties agree to establish the necessary legal provisions and administrative procedures permitting effective action to be taken against such circumvention, which shall include the adoption of legally binding corrective measures against exporters and/or importers involved.

2. If it appears on the basis of available information that this Agreement is circumvented, the Community will consult with Serbia in accordance with Article 8.

3. If the Parties fail to reach a mutually satisfactory solution, the Community shall have the right:

(a) to introduce quantitative restrictions against the same products originating in Serbia as those involved in circumvention or to take any other appropriate measures;

(b) to set off the relevant quantities against the quantitative restrictions that are established under this Agreement.

4. Where available information shows that false declaration concerning fibre content, quantities, description or classification of products originating in Community or in Serbia has occurred, both Parties shall have the right to refuse to import the products in question.

5. The Parties agree to establish a system of administrative cooperation to prevent and to address effectively all problems arising from circumvention in accordance with Annex V.

Article 7

1. Where as a direct consequence of the application of the liberalisation measures provided for in this Agreement any product is being imported in such increased quantities and under such conditions as to cause or threaten to cause:

(a) serious injury to domestic producers of like or directly competitive products in the territory of the importing Party, or

(b) serious disturbances in any related sector of the economy or difficulties which could bring about deterioration in the economic situation of a region,

the Party concerned may take appropriate measures after consultations are held in accordance with Article 8. In case the other Party considers the measure adopted is not justified, it shall be free to suspend the application of substantially equivalent concessions granted under this Agreement after consultations are held in accordance with Article 8.

2. The Parties may request consultations in accordance with Article 8 when either of them ascertains that during a particular year of application of this Agreement difficulties arise in the Community or in Serbia due to a sharp and substantial increase, by comparison to the preceding year, in imports of a given category of Group I.

Article 8

1. The consultation procedures referred to in this Agreement shall be governed by the following provisions:

(a) any request for consultations shall be notified in writing to the other Party;

(b) the request for consultations shall be followed, within a reasonable period of time and in any case not later than 15 days following the notification, by a report setting out the circumstances which, in the opinion of the requesting Party, justify the submission of such a request;

(c) the Parties shall enter into consultations within 30 days of notification of the request at the latest, with a view to reaching a mutually acceptable solution within a further 30-day period at the latest, unless this period is extended by common accord.

2. At the request of either of the Parties, consultations shall be held on any problems arising from the application of this Agreement. Any consultations held under this Article shall take place in a spirit of cooperation and with a desire to reconcile the differences between the Parties.

TITLE II

QUANTITATIVE RESTRICTIONS AND SURVEILLANCE REGIME

Article 9

1. The classification of the products covered by this Agreement is based on the tariff and statistical nomenclature of the Community (hereinafter referred to as the Combined Nomenclature or, in abbreviated form, CN) and any amendments thereof.

Where any decision on classification results in a change of classification practice or a change of category of any product subject to this Agreement the affected products shall follow the trade regime applicable to the practice or category they fall into after such changes.

Any amendment to the Combined Nomenclature made in accordance with the procedures in force in the Community concerning categories of products covered by this Agreement or any decision relating to the classification of goods shall not have the effect of reducing quantitative restrictions introduced pursuant to this Agreement.

2. The origin of the products covered by this Agreement shall be determined in accordance with the non-preferential rules of origin in force in the Community.

The origin of the products subject to the tariff dismantling schedule provided for in Article 2(1), shall be determined in accordance with Community rules that apply to autonomous preferential tariff measures for certain countries or territories. Any amendment to these rules of origin shall be communicated to Serbia.

The procedures for control of the origin of the products referred to above are laid down in Annex V.

Article 10

1. If quantitative restrictions are re-introduced in accordance with Articles 5, 6 and 7, exports of the textile products under quantitative restrictions shall be subject to a double-checking system as specified in Annex V.

2. Following consultations in accordance with the procedures set out in Article 8, exports of products in Annex I not subject to quantitative restrictions may be subject to the double-checking system referred to in Annex V or to a prior surveillance introduced by the Community.

Article 11

1. The Parties recognise that re-imports of textile products into the Community after processing in Serbia are a specific form of industrial and trade cooperation.

2. Should quantitative restrictions be established under the conditions specified in this Agreement, these re-imports shall not be subject to these quantitative restrictions if they are subject to the specific arrangements laid down in Title III.

Article 12

Exports from Serbia of cottage-industry fabrics woven on hand- or foot-operated looms, garments or other made-up articles obtained manually from such fabrics and of traditional folklore handicraft products shall not be subject to the quantitative restrictions established under this Agreement, provided that these products originating in Serbia meet the conditions laid down in Annex VI.

Article 13

1. Imports into the Community of textile products covered by this Agreement shall not be subject to any quantitative restrictions that may be established under this Agreement, provided that they are declared to be for re-export outside the Community in the same state or after processing, within the framework of the administrative system of control which exists within the Community.

However, the release into free circulation of products into the Community under the conditions referred to above shall be subject to the production of an export licence issued by the Ministry of International Economic Relations of Serbia, and to the production of a proof of origin in accordance with Annex V.

2. Where the Community authorities ascertain that imports of textile products have been set off against quantitative restrictions that may have been established under this Agreement, but that the products have subsequently been re-exported outside the Community, the authorities shall inform the Ministry of International Economic Relations of Serbia within four weeks of the quantities involved and authorise imports of identical quantities of the same products, which shall not be set off against the quantitative restriction established under this Agreement for the current or the following year, as appropriate.

Article 14

Should quantitative restrictions be introduced under this Agreement, the following provisions shall apply:

1. in any year advance use of a portion of the quantitative restriction established for the following year is authorised for each category of products up to 5 % of the quantitative restriction for the current year.

Amounts delivered in advance shall be deducted from the corresponding quantitative restrictions established for the following year;

2. carryover to the corresponding quantitative restriction for the following year of the amounts not used during any year is authorised for each category of products up to 10 % of the quantitative restriction for the current year;

3. transfers in respect of categories in group I shall not be made from any category except as follows:

- transfers between categories 1, 2 and 3 may be made up to 12 % of the quantitative restriction for the category to which the transfer is made,

- transfers between categories 4, 5, 6, 7 and 8 may be made up to 12 % of the quantitative restriction for the category to which the transfer is made.

Transfers into any category in groups II and III may be made from any category or categories in groups I, II and III up to 12 % of the quantitative restriction for the category to which the transfer is made;

4. the table of equivalence applicable to the transfers referred to is given in Annex I;

5. the increase in any category of products resulting from the cumulative application of the provisions in paragraphs 1, 2 and 3 during a year shall not exceed 17 %;

6. prior notification shall be given by the Ministry of International Economic Relations of Serbia in the event of recourse to the provisions of paragraphs 1, 2 and 3, at least 15 days in advance.

Article 15

The annual growth rate for the quantitative restrictions which may be introduced as provided for by this Agreement for the products covered by it shall be fixed by agreement between the Parties in accordance with the consultation procedures established in Article 8.

Article 16

1. The Ministry of International Economic Relations of Serbia shall supply the Commission of the European Communities with precise statistical information on all export licences issued for categories of textile products subject to the quantitative restrictions established under this Agreement or to a double-checking system, expressed in quantities and in terms of value and broken down by Member States of the Community, as well as on all certificates issued by the Customs Administration of Serbia for products referred to in Article 12 and subject to Annex VI.

2. The Community shall likewise transmit to the Ministry of International Economic Relations of Serbia precise statistical information on import authorisations issued by the Community authorities and import statistics for textile products.

3. The information referred to above shall, for all categories of products, be forwarded before the end of the month following the month to which the statistics relate.

4. Upon request by the Community, the Ministry of International Economic Relations of Serbia shall supply import statistics for all products covered by Annex I.

5. If on the basis of the information exchanged it appears that there are significant discrepancies between the returns for exports and those for imports, consultations may be initiated in accordance with the procedure specified in Article 8.

6. For the purpose of applying the provisions of this Agreement, the Community undertakes to provide the Ministry of International Economic Relations of Serbia before 15 April of each year with the preceding year's statistics on imports of all textile products covered by this Agreement, broken down by supplying country and Member State.

Article 17

1. Serbia shall monitor its exports of products under restraint or surveillance into the Community. Should a sudden and prejudicial change in traditional trade flows arise, the Community will be entitled to request consultations in order to find a satisfactory solution to those problems. Such consultations shall be held within 15 working days of their being requested by the Community.

2. Serbia shall endeavour to ensure that exports of textile products subject to quantitative restrictions, which may be established under this Agreement into the Community are spaced out as evenly as possible over the year, due account being taken in particular of seasonal factors.

Article 18

In the event of denunciation of this Agreement, the quantitative restrictions that may be established pursuant to it shall be reduced on a pro rata temporis basis unless the Parties decide otherwise by common agreement.

Article 19

The Parties undertake to refrain from discrimination in the allocation of export licences and import authorisations or documents referred to in Annexes V and VI.

TITLE III

OUTWARD PROCESS TRAFFIC (OPT)

Article 20

Re-imports into the Community, within the meaning of Article 11, shall be subject to this Agreement, unless the following special provisions provide otherwise.

1. Re-imports into the Community referred to in Article 11 may be made subject to specific quantitative restrictions following consultations in accordance with the procedures set out in Article 8, provided the products concerned are subject to quantitative restrictions pursuant to this Agreement, to a double-checking system or to surveillance measures.

2. Having regard to the interests of both Parties, the Community may at its discretion, or in response to a request under Article 8:

(a) examine the possibility of transferring from one category to another, using in advance or carrying over from one year to the next, portions of specific quantitative restrictions;

(b) consider the possibility of increasing specific quantitative restrictions.

3. However, the Community may apply automatically the flexibility rules set out in paragraph 2 within the following restrictions:

(a) transfers between categories may not exceed 25 % of the quantity set for the category to which the transfer is made;

(b) carry-over of a specific quantitative restriction from one year to the next may not exceed 13,5 % of the quantity set for the year of actual utilisation;

(c) advance use of specific quantitative restrictions from one year to another may not exceed 7,5 % of the quantity set for the year of actual utilisation.

4. The Community shall inform Serbia of any measures taken pursuant to the preceding paragraphs.

5. The competent authorities in the Community shall debit the specific quantitative restrictions referred to in paragraph 1 at the time of issue of the prior authorisation required by the relevant Community legislation which governs economic outward processing arrangements. A specific quantitative restriction shall be debited for the year in which a prior authorisation is issued.

6. A certificate of origin made out by the organisations authorised to do so under the law of Serbia shall be issued, in accordance with Annex V, for all products covered by this Title. This certificate shall bear a reference to the prior authorisation mentioned in paragraph 5 as evidence that the processing operation it describes has been carried out in Serbia.

7. The Community shall provide Serbia with the names and addresses of, and specimens of the stamps used by, the competent authorities of the Community, which issue the prior authorisations referred to in paragraph 5.

TITLE IV

FINAL PROVISIONS

Article 21

The operation of this Agreement shall be reviewed prior to the accession of Serbia to the World Trade Organisation (WTO). Should Serbia become a Member of the WTO before the expiry of this Agreement, the Agreements and rules of the WTO shall be applied from the date of Serbia's accession to the WTO.

Article 22

1. This Agreement shall apply, on the one hand, to the territories in which the Treaty establishing the Community is applied and under the conditions laid down in that Treaty and, on the other hand, to the territory of Serbia. As regards Serbia, this Agreement shall be binding and directly applicable for all its authorities.

2. This Agreement shall not apply in Kosovo which is at present under international administration pursuant to United Nations Security Council Resolution 1244 of 10 June 1999. This is without prejudice to the current status of Kosovo or the determination of its final status under the same Resolution.

Article 23

1. This Agreement shall enter into force on the first day of the second month following the date on which the Parties notify each other of the completion of the procedures necessary for that purpose. The Parties agree to review this Agreement in the light of possible negotiations on a Stabilisation and Association Agreement.

2. Either Party may at any time propose modifications to this Agreement.

3. Either Party may at any time denounce this Agreement provided that at least 60 days' notice is given. In that event, this Agreement shall come to an end on the expiry of the period of notice.

4. The Annexes attached to this Agreement shall form an integral part thereof.

Article 24

This Agreement shall be drawn up in duplicate in the Czech, Danish, Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Slovakian, Slovenian, Spanish, Swedish and Serbian languages, each of these texts being equally authentic.

Hecho en Bruselas, el treinta y uno de marzo del dos mil cinco.

V Bruselu dne třicátého prvního března dva tisíce pět.

Udfærdiget i Bruxelles den enogtredivte marts to tusind og fire.

Geschehen zu Brüssel am einunddreißigsten März zweitausendfünf.

Kahe tuhande viienda aasta märtsikuu kolmekümne esimesel päeval Brüsselis.

Έγινε στις Βρυξέλλες, στις τριάντα μία Μαρτίου δύο χιλιάδες πέντε.

Done at Brussels on the thirty-first day of March in the year two thousand and five.

Fait à Bruxelles, le trente-et-un mars deux mille cinq.

Fatto a Bruxelles, addi' trentuno marzo duemilacinque.

Briselē, divtūkstoš piektā gada trīsdesmit pirmajā martā.

Priimta du tūkstančiai penktų metų kovo trisdešimt pirmą dieną Briuselyje.

Kelt Brüsszelben, a kettőezer ötödik év március harmincegyedik napján.

Magħmul fi Brussel, fil-wieħed u tletin jum ta' Marzu tas-sena elfejn u ħamsa.

Gedaan te Brussel, de eenendertigste maart tweeduizend vijf.

Sporządzono w Brukseli dnia trzydziestego pierwszego marca roku dwutysięcznego piątego.

Feito em Bruxelas, em trinta e um de Março de dois mil e cinco.

V Bruselju, enaintridesetega marca leta dva tisoč pet.

V Bruseli dňa tridsiateho prvého marca dvetisícpäť.

Tehty Brysselissä kolmantenakymmenentenäensimmäisenä päivänä maaliskuuta vuonna kaksituhattaviisi.

Som skedde i Bryssel den trettioförsta mars tjugohundrafem.

Сачињено у Бриселу тридесет првог марта две хиљаде и пете године.

Por la Comunidad Europea

Za Evropské společenství

For Det Europæiske Fællesskab

Für die Europäische Gemeinschaft

Euroopa Ühenduse nimel

Για την Ευρωπαϊκή Κοινότητα

For the European Community

Pour la Communauté européenne

Per la Comunità europea

Eiropas Kopienas vārdā

Europas bendrijos vardu

az Európai Közösség részéről

Ghall-Komunità Ewropea

Voor de Europese Gemeenschap

W imieniu Wspólnoty Europejskiej

Pela Comunidade Europeia

Za Európske spoločenstvo

za Evropsko skupnost

Euroopan yhteisön puolesta

På Europeiska gemenskapens vägnar

Зa Европску заједнипу

Por la República de Serbia

Za Srbskou republiku

For Republikken Serbien

Für die Republik Serbien

Serbia Vabariigi nimel

Για τη Δημοκρατία της Σερβίας

For the Republic of Serbia

Pour la République de Serbie

Per la Repubblica di Serbia

Serbijas Republikas vārdā

Serbijos Respublikos vardu

a Szerb Köztársaság részéről

Ghar-Repubblika tas-Serbja

Voor de Republiek Servië

W imieniu Republiki Serbii

Pela República da Sérvia

Za Srbskú republiku

Za Republiko Srbijo

Serbian tasavallan puolesta

För Republiken Serbien

За Републику Србију

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ANNEX I

TEXTILE PRODUCTS REFERRED TO IN ARTICLE 1

1. Without prejudice to the rules for the interpretation of the combined nomenclature, the wording of the description of goods is considered to be of indicative value only, since the products covered by each category are determined, within this Annex, by CN codes. Where there is an "ex" symbol in front of a CN code, the products covered in each category are determined by the scope of the CN code and by that of the corresponding description.

2. When the constitutive material of the products of categories 1 to 114 is not specifically mentioned, these products are to be taken to be made exclusively of wool or of fine hair, of cotton or of man-made fibres.

3. Garments which are not recognisable as being garments for men or boys or as being garments for women or girls are classified with the latter.

4. Where the expression "babies" garments' is used, this is meant to cover garments up to and including commercial size 86.

Category | Description | Table of equivalence |

| CN code 2005 | pieces/kg | g/piece |

(1) | (2) | (3) | (4) |

GROUP I A |

1 | Cotton yarn, not put up for retail sale | | |

| 52041100 52041900520511005205120052051300520514005205151052051590520521005205220052052300520524005205260052052700520528005205310052053200520533005205340052053500520541005205420052054300520544005205460052054700520548005206110052061200520613005206140052061500520621005206220052062300520624005206250052063100520632005206330052063400520635005206410052064200520643005206440052064500ex56049000 | | |

2 | Woven fabrics of cotton, other than gauze, terry fabrics, pile fabrics, chenille fabrics, tulle and other net fabrics | | |

| 52081110520811905208121652081219520812965208129952081300520819005208211052082190520822165208221952082296520822995208230052082900520831005208321652083219520832965208329952083300520839005208410052084200520843005208490052085100520852105208529052085300520859005209110052091200520919005209210052092200520929005209310052093200520939005209410052094200520943005209490052095100520952005209590052101100521012005210190052102100521022005210290052103100521032005210390052104100521042005210490052105100521052005210590052111100521112005211190052112100521122005211290052113100521132005211390052114100521142005211430052114910521149905211510052115200521159005212111052121190521212105212129052121310521213905212141052121490521215105212159052122110521221905212221052122290521223105212239052122410521224905212251052122590ex58110000ex63080000 | | |

2 (a) | Of which: Other than unbleached or bleached | | |

| 52083100520832165208321952083296520832995208330052083900520841005208420052084300520849005208510052085210520852905208530052085900520931005209320052093900520941005209420052094300520949005209510052095200520959005210310052103200521039005210410052104200521049005210510052105200521059005211310052113200521139005211410052114200521143005211491052114990521151005211520052115900521213105212139052121410521214905212151052121590521223105212239052122410521224905212251052122590ex58110000ex63080000 | | |

3 | Woven fabrics of synthetic fibres (discontinuous or waste) other than narrow woven fabrics, pile fabrics (including terry fabrics) and chenille fabrics | | |

| 55121100551219105512199055122100551229105512299055129100551299105512999055131120551311905513120055131300551319005513211055132130551321905513220055132300551329005513310055133200551333005513390055134100551342005513430055134900551411005514120055141300551419005514210055142200551423005514290055143100551432005514330055143900551441005514420055144300551449005515111055151130551511905515121055151230551512905515131155151319551513915515139955151910551519305515199055152110551521305515219055152211551522195515229155152299551529005515911055159130551591905515921055159290551599105515993055159990ex58039040ex59050070ex63080000 | | |

3 (a) | Of which: Other than unbleached or bleached | | |

| 5512191055121990551229105512299055129910551299905513211055132130551321905513220055132300551329005513310055133200551333005513390055134100551342005513430055134900551421005514220055142300551429005514310055143200551433005514390055144100551442005514430055144900551511305515119055151230551512905515131955151399551519305515199055152130551521905515221955152299ex551529005515913055159190ex55159210ex551592905515993055159990ex58039040ex59050070ex63080000 | | |

GROUP I B |

4 | Shirts, T-shirts, lightweight fine knit roll, polo or turtle necked jumpers and pullovers (other than of wool or fine animal hair), undervests and the like, knitted or crocheted | 6,48 | 154 |

| 610510006105201061052090610590106109100061099010610990306110201061103010 | | |

5 | Jerseys, pullovers, slip-overs, waistcoats, twinsets, cardigans, bed-jackets and jumpers (others than jackets and blazers), anoraks, wind-cheaters, waister jackets and the like, knitted or crocheted | 4,53 | 221 |

| 6101109061012090610130906102109061022090610230906110111061101130611011906110121061101290611019106110209061102091611020996110309161103099 | | |

6 | Men's or boys' woven breeches, shorts other than swimwear and trousers (including slacks); women's or girls' woven trousers and slacks, of wool, of cotton or of man made fibres; lower parts of track suits with lining, others than category 16 or 29, of cotton or of man-made fibres | 1,76 | 568 |

| 6203411062034190620342316203423362034235620342906203431962034390620349196203495062046110620462316204623362046239620463186204691862113242621133426211424262114342 | | |

7 | Women's or girls' blouses, shirts and shirt-blouses, whether or not knitted or crocheted, of wool, of cotton or man-made fibres | 5,55 | 180 |

| 610610006106200061069010620620006206300062064000 | | |

8 | Men's or boys' shirts, other than knitted or crocheted, of wool, cotton or man-made fibres | 4,60 | 217 |

| 620510006205200062053000 | | |

GROUP II A |

9 | Terry towelling and similar woven terry fabrics of cotton; toilet linen and kitchen linen, other than knitted or crocheted, of terry towelling and woven terry fabrics, of cotton | | |

| 5802110058021900ex63026000 | | |

20 | Bed linen, other than knitted or crocheted | | |

| 630221006302229063022990630231006302329063023990 | | |

22 | Yarn of staple or waste synthetic fibres, not put up for retail sale | | |

| 55081010550911005509120055092100550922005509310055093200550941005509420055095100550952005509530055095900550961005509620055096900550991005509920055099900 | | |

22 (a) | Of which acrylic | | |

| ex550810105509310055093200550961005509620055096900 | | |

23 | Yarn of staple or waste artificial fibres, not put up for retail sale | | |

| 550820105510110055101200551020005510300055109000 | | |

32 | Woven pile fabrics and chenille fabrics (other than terry towelling or terry fabrics of cotton and narrow woven fabrics) and tufted textile surfaces, of wool, of cotton or of man-made textile fibres | | |

| 580110005801210058012200580123005801240058012500580126005801310058013200580133005801340058013500580136005802200058023000 | | |

32 (a) | Of which: Cotton corduroy | | |

| 58012200 | | |

39 | Table linen, toilet linen and kitchen linen, other than knitted or crocheted, other than of terry towelling or a similar terry fabrics of cotton | | |

| 6302510063025390ex630259006302910063029390ex63029900 | | |

GROUP II B |

12 | Panty-hose and tights, stockings, understockings, socks, ankle-socks, sockettes and the like, knitted or crocheted, other than for babies, including stockings for varicose veins, other than products of category 70 | 24,3 pairs | 41 |

| 61151200611519006115201161152090611591006115920061159310611593306115939961159900 | | |

13 | Men's or boys' underpants and briefs, women's or girls' knickers and briefs, knitted or crocheted, of wool, of cotton or of man-made fibres | 17 | 59 |

| 610711006107120061071900610821006108220061082900ex62121010 | | |

14 | Men's or boys' woven overcoats, raincoats and other coats, cloaks and capes, of wool, of cotton or of man-made textile fibres (other than parkas) (of category 21) | 0,72 | 1389 |

| 62011100ex62011210ex62011290ex62011310ex6201139062102000 | | |

15 | Women's or girls' woven overcoats, raincoats and other coats, cloaks and capes; jackets and blazers, of wool, of cotton or of man-made textile fibres (other than parkas) (of category 21) | 0,84 | 1190 |

| 62021100ex62021210ex62021290ex62021310ex620213906204310062043290620433906204391962103000 | | |

16 | Men's or boys' suits and ensembles, other than knitted or crocheted, of wool, of cotton or of man-made fibres, excluding ski suits; men's or boys' track suits with lining, with an outer shell of a single identical fabric, of cotton or of man-made fibres | 0,80 | 1250 |

| 62031100620312006203191062031930620321006203228062032380620329186211323162113331 | | |

17 | Men's or boys' jackets or blazers, other than knitted or crocheted, of wool, of cotton or of man-made fibres | 1,43 | 700 |

| 62033100620332906203339062033919 | | |

18 | Men's or boys' singlets and other vests, underpants, briefs, nightshirts, pyjamas, bathrobes, dressing gowns and similar articles, other than knitted or crocheted | | |

| 6207110062071900620721006207220062072900620791006207920062079900 | | |

| Women's or girls' singlets and other vests, slips, petticoats, briefs, panties, night-dresses, pyjamas, négligees, bathrobes, dressing gowns and similar articles, other than knitted or crocheted | | |

| 6208110062081900620821006208220062082900620891006208920062089900ex62121010 | | |

19 | Handkerchiefs, other than knitted or crocheted | 59 | 17 |

| 6213200062139000 | | |

21 | Parkas; anoraks, windcheaters, waister jackets and the like, other than knitted or crocheted, of wool, of cotton or of man-made fibres; upper parts of tracksuits with lining, other than category 16 or 29, of cotton or of man-made fibres | 2,3 | 435 |

| ex62011210ex62011290ex62011310ex62011390620191006201920062019300ex62021210ex62021290ex62021310ex6202139062029100620292006202930062113241621133416211424162114341 | | |

24 | Men's or boys' nightshirts, pyjamas, bathrobes, dressing gowns and similar articles, knitted or crocheted | 3,9 | 257 |

| 6107210061072200610729006107910061079200ex61079900 | | |

| Women's or girls' night-dresses, pyjamas, négligees, bathrobes, dressing gowns and similar articles, knitted or crocheted | | |

| 6108310061083200610839006108910061089200ex61089900 | | |

26 | Women's or girls' dresses, of wool, of cotton or of man-made fibres | 3,1 | 323 |

| 6104410061044200610443006104440062044100620442006204430062044400 | | |

27 | Women's or girls' skirts, including divided skirts | 2,6 | 385 |

| 6104510061045200610453006104590062045100620452006204530062045910 | | |

28 | Trousers, bib and brace overalls, breeches and shorts (other than swimwear), knitted or crocheted, of wool, of cotton or of man-made fibres | 1,61 | 620 |

| 610341006103420061034300ex61034900610461006104620061046300ex61046900 | | |

29 | Women's or girls' suits and ensembles, other than knitted or crocheted, of wool, of cotton or of man-made fibres, excluding ski suits; women's or girls' track suits with lining, with an outer shell of an identical fabric, of cotton or of man-made fibres | 1,37 | 730 |

| 62041100620412006204130062041910620421006204228062042380620429186211423162114331 | | |

31 | Brassières, woven, knitted or crocheted | 18,2 | 55 |

| ex6212101062121090 | | |

68 | Babies' garments and clothing accessories, excluding babies' gloves, mittens and mitts of categories 10 and 87, and babies' stockings, socks and sockettes, other than knitted or crocheted, of category 88 | | |

| 611110906111209061113090ex61119000ex62091000ex62092000ex62093000ex62099000 | | |

73 | Track suits of knitted or crocheted fabric, of wool, of cotton or of man-made textile fibres | 1,67 | 600 |

| 611211006112120061121900 | | |

76 | Men's or boys' industrial or occupational clothing, other than knitted or crocheted | | |

| 6203221062032310620329116203321062033310620339116203421162034251620343116203433162034911620349316211321062113310 | | |

| Women's or girls' aprons, smock overalls and other industrial or occupational clothing, other than knitted or crocheted | | |

| 6204221062042310620429116204321062043310620439116204621162046251620463116204633162046911620469316211421062114310 | | |

77 | Ski suits, other than knitted or crocheted | | |

| ex62112000 | | |

78 | Garments, other than knitted or crocheted, excluding garments of categories 6, 7, 8, 14, 15, 16, 17, 18, 21, 26, 27, 29, 68, 72, 76 and 77 | | |

| 62034130620342596203433962034939620461856204625962046290620463396204639062046939620469506210400062105000621131006211329062113390621141006211429062114390 | | |

83 | Overcoats, jackets, blazers and other garments, including ski suits, knitted or crocheted, excluding garments of categories 4, 5, 7, 13, 24, 26, 27, 28, 68, 69, 72, 73, 74, 75 | | |

| 610110106101201061013010610210106102201061023010610331006103320061033300ex61033900610431006104320061043300ex610439006112200061130090611410006114200061143000 | | |

GROUP III A |

33 | Woven fabrics of synthetic filament yarn obtained from strip or the like of polyethylene or polypropylene, less than 3 m wide | | |

| 54072011 | | |

| Sacks and bags, of a kind used for the packing of goods, not knitted or crocheted, obtained from strip or the like | | |

| 63053281630532896305339163053399 | | |

34 | Woven fabrics of synthetic filament yarn obtained from strip or the like of polyethylene or polypropylene, 3 m or more wide | | |

| 54072019 | | |

35 | Woven fabrics of synthetic fibres (continuous), other than those for tyres of category 114 | | |

| 5407100054072090540730005407410054074200540743005407440054075100540752005407530054075400540761105407613054076150540761905407691054076990540771005407720054077300540774005407810054078200540783005407840054079100540792005407930054079400ex58110000ex59050070 | | |

35 (a) | Of which: Other than unbleached or bleached | | |

| ex54071000ex54072090ex5407300054074200540743005407440054075200540753005407540054076130540761505407619054076990540772005407730054077400540782005407830054078400540792005407930054079400ex58110000ex59050070 | | |

36 | Woven fabrics of continuous artificial fibres, other than those for tyres of category 114 | | |

| 5408100054082100540822105408229054082310540823905408240054083100540832005408330054083400ex58110000ex59050070 | | |

36 (a) | Of which: Other than unbleached or bleached | | |

| ex540810005408221054082290540823105408239054082400540832005408330054083400ex58110000ex59050070 | | |

37 | Woven fabrics of artificial staple fibres | | |

| 551611005516120055161300551614005516210055162200551623105516239055162400551631005516320055163300551634005516410055164200551643005516440055169100551692005516930055169400ex58039040ex59050070 | | |

37 (a) | Of which: Other than unbleached or bleached | | |

| 55161200551613005516140055162200551623105516239055162400551632005516330055163400551642005516430055164400551692005516930055169400ex58039040ex59050070 | | |

38 A | Knitted or crocheted synthetic curtain fabric including net curtain fabric | | |

| 6005311060053210600533106005341060063110600632106006331060063410 | | |

38 B | Net curtains, other than knitted or crocheted | | |

| ex63039100ex63039290ex63039990 | | |

40 | Woven curtains (including drapes, interior blinds, curtain and bed valances and other furnishing articles), other than knitted or crocheted, of wool, of cotton or of man-made fibres | | |

| ex63039100ex63039290ex6303999063041910ex6304199063049200ex63049300ex63049900 | | |

41 | Yarn of synthetic filament (continuous), not put up for retail sale, other than non textured single yarn untwisted or with a twist of not more than 50 turns/m | | |

| 5401101254011014540110165401101854021010540210905402200054023100540232005402330054023910540239905402491054024991540249995402510054025200540259105402599054026100540262005402691054026990ex56042000ex56049000 | | |

42 | Yarn of continuous man-made fibres, not put up for retail sale | | |

| 54012010 | | |

| Yarn of artificial fibres; yarn of artificial filaments, not put up for retail sale, other than single yarn of viscose rayon untwisted or with a twist of not more than 250 turns/m and single non textured yarn of cellulose acetate | | |

| 5403100054032000ex54033200ex5403330054033900540341005403420054034900ex56042000 | | |

43 | Yarn of man-made filament, yarn of artificial staple fibres, cotton yarn, put up for retail sale | | |

| 520420005207100052079000540110905401209054061000540620005508209055113000 | | |

46 | Carded or combed sheep's or lambs' wool or other fine animal hair | | |

| 510510005105210051052900510531005105391051053990 | | |

47 | Yarn of carded sheep's or lambs' wool (woollen yarn) or of carded fine animal hair, not put up for retail sale | | |

| 51061010510610905106201051062091510620995108101051081090 | | |

48 | Yarn of combed sheep's or lambs' wool (worsted yarn) or of combed fine animal hair, not put up for retail sale | | |

| 51071010510710905107201051072030510720515107205951072091510720995108201051082090 | | |

49 | Yarn of sheep's or lambs' wool or of combed fine animal hair, put up for retail sale | | |

| 51091010510910905109901051099090 | | |

50 | Woven fabrics of sheep's or lambs' wool or of fine animal hair | | |

| 51111100511119105111199051112000511130105111303051113090511190105111909151119093511190995112110051121910511219905112200051123010511230305112309051129010511290915112909351129099 | | |

51 | Cotton, carded or combed | | |

| 52030000 | | |

53 | Cotton gauze | | |

| 58031000 | | |

54 | Artificial staple fibres, including waste, carded, combed or otherwise processed for spinning | | |

| 55070000 | | |

55 | Synthetic staple fibres, including waste, carded, combed or otherwise processed for spinning | | |

| 5506100055062000550630005506901055069090 | | |

56 | Yarn of synthetic staple fibres (including waste), put up for retail sale | | |

| 550810905511100055112000 | | |

58 | Carpets, carpentines and rugs, knotted (made up or not) | | |

| 57011010570110905701901057019090 | | |

59 | Carpets and other textile floor coverings, other than the carpets of category 58 | | |

| 5702100057023110570231805702321057023290ex570239005702410057024200ex57024900570251005702521057025290ex57025900570291005702921057029290ex57029900570310005703201157032019570320915703209957033011570330195703308157033089570390105703909057041000570490005705001057050030ex57050090 | | |

60 | Tapestries, hand-made, of the type Gobelins, Flanders, Aubusson, Beauvais and the like, and needlework tapestries (e.g. petit point and cross stitch) made in panels and the like by hand | | |

| 58050000 | | |

61 | Narrow woven fabrics, and narrow fabrics (bolduc) consisting of warp without weft, assembled by means of an adhesive, other than labels and similar articles of category 62Elastic fabrics and trimmings (not knitted or crocheted), made from textile materials assembled from rubber thread | | |

| ex58061000580620005806310058063210580632905806390058064000 | | |

62 | Chenille yarn (including flock chenille yarn), gimped yarn (other than metallised yarn and gimped horsehair yarn) | | |

| 5606009156060099 | | |

| Tulle and other net fabrics but not including woven, knitted or crocheted fabrics, hand or mechanically-made lace, in the piece, in strips or in motifs | | |

| 5804101158041019580410905804211058042190580429105804299058043000 | | |

| Labels, badges and the like of textile materials, not embroidered, in the piece, in strips or cut to shape or size, woven | | |

| 5807101058071090 | | |

| Braids and ornamental trimmings in the piece; tassels, pompons and the like | | |

| 5808100058089000 | | |

| Embroidery, in the piece, in strips or in motifs | | |

| 5810101058101090581091105810919058109210581092905810991058109990 | | |

63 | Knitted or crocheted fabric of synthetic fibres containing by weight 5 % or more elastomeric yarn and knitted or crocheted fabrics containing by weight 5 % or more of rubber thread | | |

| 59069100ex6002400060029000ex6004100060049000 | | |

| Raschel lace and long-pile fabric of synthetic fibres | | |

| ex600110006003301060053150600532506005335060053450 | | |

65 | Knitted or crocheted fabric, other than those of categories 38 A and 63, of wool, of cotton or of man-made fibres | | |

| 56060010ex600110006001210060012200ex600129006001910060019200ex60019900ex6002400060031000600320006003309060034000ex600410006005100060052100600522006005230060052400600531906005329060053390600534906005410060054200600543006005440060061000600621006006220060062300600624006006319060063290600633906006349060064100600642006006430060064400 | | |

66 | Travelling rugs and blankets, other than knitted or crocheted, of wool, of cotton or of man-made fibres | | |

| 630110006301209063013090ex63014090ex63019090 | | |

GROUP III B |

10 | Gloves, mittens and mitts, knitted or crocheted | 17 | 59 |

| 611110106111201061113010ex61119000611610206116108061169100611692006116930061169900 | pairs | |

67 | Knitted or crocheted clothing accessories other than for babies; household linen of all kinds, knitted or crocheted; curtains (including drapes) and interior blinds, curtain or bed valances and other furnishing articles knitted or crocheted; knitted or crocheted blankets and travelling rugs, other knitted or crocheted articles including parts of garments or of clothing accessories | | |

| 58079090611300106117100061172000611780106117809061179000630120106301301063014010630190106302100063024000ex630260006303110063031200630319006304110063049100ex6305200063053211ex6305329063053310ex63053900ex630590006307101063079010 | | |

67 (a) | Of which: Sacks and bags of a kind used for the packing of goods, made from polyethylene or polypropylene strip | | |

| 6305321163053310 | | |

69 | Women's and girls' slips and petticoats, knitted or crocheted | 7,8 | 128 |

| 6108110061081900 | | |

70 | Panty-hose and tights of synthetic fibres, measuring per single yarn less than 67 decitex (6,7 tex) | 30,4 pairs | 33 |

| 6115110061152019 | | |

| Women's full length hosiery of synthetic fibres | | |

| 61159391 | | |

72 | Swimwear, of wool, of cotton or of man-made fibres | 9,7 | 103 |

| 61123110611231906112391061123990611241106112419061124910611249906211110062111200 | | |

74 | Women's or girls' knitted or crocheted suits and ensembles, of wool, of cotton or of man-made fibres, excluding ski suits | 1,54 | 650 |

| 610411006104120061041300ex61041900610421006104220061042300ex61042900 | | |

75 | Men's or boys' knitted or crocheted suits and ensembles, of wool, of cotton or of man-made fibres, excluding ski suit | 0,80 | 1250 |

| 61031100610312006103190061032100610322006103230061032900 | | |

84 | Shawls, scarves, mufflers, mantillas, veils and the like other than knitted or crocheted, of wool, of cotton or of man-made fibres | | |

| 62142000621430006214400062149010 | | |

85 | Ties, bow ties and cravats other than knitted or crocheted, of wool, of cotton or of man-made fibres | 17,9 | 56 |

| 6215200062159000 | | |

86 | Corsets, corset-belts, suspender belts, braces, suspenders, garters and the like, and parts thereof, whether or not knitted or crocheted | 8,8 | 114 |

| 621220006212300062129000 | | |

87 | Gloves, mittens and mitts, not knitted or crocheted | | |

| ex62091000ex62092000ex62093000ex6209900062160000 | | |

88 | Stockings, socks and sockettes, not knitted or crocheted; other clothing accessories, parts of garments or of clothing accessories other than for babies, other than knitted or crocheted | | |

| ex62091000ex62092000ex62093000ex620990006217100062179000 | | |

90 | Twine, cordage, ropes and cables of synthetic fibres, plaited or not | | |

| 5607410056074911560749195607499056075011560750195607503056075090 | | |

91 | Tents | | |

| 630621006306220063062900 | | |

93 | Sacks and bags, of a kind used for the packing of goods of woven fabrics, other than made from polyethylene or polypropylene strip | | |

| ex63052000ex63053290ex63053900 | | |

94 | Wadding of textile materials and articles thereof; textile fibres, not exceeding 5 mm in length (flock), textile dust and mill neps | | |

| 560110105601109056012110560121905601221056012291560122995601290056013000 | | |

95 | Felt and articles thereof, whether or not impregnated or coated, other than floor coverings | | |

| 5602101956021031560210395602109056022100ex5602290056029000ex58079010ex590500706210101063079091 | | |

96 | Non-woven fabrics and articles of such fabrics, whether or not impregnated, coated, covered or laminated | | |

| 56031110560311905603121056031290560313105603139056031410560314905603911056039190560392105603929056039310560393905603941056039490ex58079010ex5905007062101090ex63014090ex63019090630222106302321063025310630293106303921063039910ex63041990ex63049300ex63049900ex63053290ex6305390063071030ex63079099 | | |

97 | Nets and netting made of twine, cordage or rope and made up fishing nets of yarn, twine, cordage or rope | | |

| 560811115608111956081191560811995608191156081919560819305608199056089000 | | |

98 | Other articles made from yarn, twine, cordage, cables or rope, other than textile fabrics, articles made from such fabrics and articles of category 97 | | |

| 5609000059050010 | | |

99 | Textile fabrics coated with gum or amylaceous substances, of a kind used for the outer covers of books and the like; tracing cloth; prepared painting canvas; buckram and similar stiffened textile fabrics of a kind used for hat foundations | | |

| 5901100059019000 | | |

| Linoleum, whether or not cut to shape; floor coverings consisting of a coating or covering applied on a textile backing, whether or not cut to shape | | |

| 5904100059049000 | | |

| Rubberised textile fabric, not knitted or crocheted, excluding those for tyres | | |

| 590610005906991059069990 | | |

| Textile fabrics otherwise impregnated or coated; painted canvas being theatrical scenery, studio back-cloths, other than of category 100 | | |

| 5907001059070090 | | |

100 | Textile fabrics impregnated, coated, covered or laminated with preparations of cellulose derivatives or of other artificial plastic materials | | |

| 59031010590310905903201059032090590390105903909159039099 | | |

101 | Twine, cordage, ropes and cables, plaited or not, other than of synthetic fibres | | |

| ex56079090 | | |

109 | Tarpaulins, sails, awnings and sunblinds | | |

| 6306110063061200630619006306310063063900 | | |

110 | Woven pneumatic mattresses | | |

| 6306410063064900 | | |

111 | Camping goods, woven, other than pneumatic mattresses and tents | | |

| 6306910063069900 | | |

112 | Other made up textile articles, woven, excluding those of categories 113 and 114 | | |

| 63072000ex63079099 | | |

113 | Floor cloth, dish cloth and dusters, other than knitted or crocheted | | |

| 63071090 | | |

114 | Woven fabrics and articles for technical uses | | |

| 5902101059021090590220105902209059029010590290905908000059090010590900905910000059111000ex591120005911311159113119591131905911321059113290591140005911901059119090 | | |

GROUP IV |

115 | Flax or ramie yarn | | |

| 5306101053061030530610505306109053062010530620905308901253089019 | | |

117 | Woven fabrics of flax or of ramie | | |

| 530911105309119053091900530921105309219053092900531100105803909059050030 | | |

118 | Table linen, toilet linen and kitchen linen of flax or ramie, other knitted or crocheted | | |

| 630229106302392063025200ex6302590063029200ex63029900 | | |

120 | Curtains (including drapes), interior blinds, curtain and bed valances and other furnishing articles, not knitted or crocheted, of flax or ramie | | |

| ex6303999063041930ex63049900 | | |

121 | Twine, cordage, ropes and cables, plaited or not, of flax or ramie | | |

| ex56079090 | | |

122 | Sacks and bags, of a kind used for the packing of goods, used, of flax, other than knitted or crocheted | | |

| ex63059000 | | |

123 | Woven pile fabrics and chenille fabrics of flax or ramie, other than narrow woven fabrics | | |

| 58019010ex58019090 | | |

| Shawls, scarves, mufflers, mantillas, veils and the like, of flax or ramie, other than knitted or crocheted | | |

| 62149090 | | |

--------------------------------------------------

ANNEX II

TARIFFS DISMANTLING SCHEDULE

DISMANTLING TABLE |

| Tariffs (2004) | 2005 | 2006 | 2007 | 2008 and subsequent years |

Raw materials | 0 | 0 | 0 | 0 | 0 |

1 | 0,5 | 0 | 0 | 0 |

10 | 7 | 5 | 3 | 0 |

Yarn/fibres | 0 | 0 | 0 | 0 | 0 |

1 | 1 | 1 | 1 | 0 |

5 | 4 | 4 | 3 | 0 |

10 | 7 | 5 | 2 | 0 |

Fabrics | 1 | 1 | 1 | 1 | 0 |

5 | 4 | 4 | 2 | 0 |

10 | 7 | 5 | 2 | 0 |

15 | 12 | 9 | 5 | 0 |

Apparel | 5 | 5 | 4 | 3 | 0 |

10 | 7 | 5 | 2 | 0 |

18 | 14 | 10 | 7 | 0 |

22 | 16 | 12 | 8 | 0 |

--------------------------------------------------

ANNEX III

AGREED MINUTE ON MARKET ACCESS

The Parties recorded their understanding that non-tariff barriers related to all forms of hindrance to trade in the sector are not to be applied by either of the Parties. The Parties agree these non-tariff barriers include but are not limited to matters such as:

- any additional customs duties on the import or sale of products of Community or Serbian origin in excess of those set out in this Agreement, or any fees and charges in connection with importation or exportation in excess of the approximate cost of services rendered,

- any taxes which are higher than any such taxes imposed on the production or sale of equivalent domestic goods,

- technical regulations or standards, or conformity assessment or certification rules, procedures or practices going beyond the purposes for which they are required,

- any further barriers and controls within the territory of each Party hampering the free movement of goods after customs clearance and their release into free circulation,

- any indicative values resulting in effective application of minimum prices or arbitrary and fictitious prices or any customs valuation rules, procedures or practices giving rise to barriers to trade,

- rules, procedures or practices for pre-shipment inspection that are discriminatory, non-transparent, excessively lengthy or burdensome, and the imposition of customs controls for the clearance of goods to shipments that have already been subject of pre-shipment inspection,

- excessively burdensome, costly or arbitrary rules, procedures or practices concerning the certification of the origin of products or requiring direct shipment of goods from the country of origin to the country of destination,

- any non-automatic, discretionary or other licensing requirements, rules, procedures or practices imposing disproportionate burdens or having restrictive effects on imports. In particular application for automatic licenses submitted in an appropriate and complete form should be approved immediately on receipt, to the extent administratively feasible, but within a maximum of 10 working days,

- requirements or practices concerning marking, labelling, the description of composition of the product or the description of the manufacturing of products which, either in their formulation or in their application, are in any form discriminatory as compared with domestic products and no more trade restrictive than necessary to fulfil a legitimate objective,

- unduly long customs clearance delays or excessively burdensome, non-transparent or costly customs procedures, including inspection requirements, which have an unnecessary restrictive effect on imports,

- subsidies causing injury to the textiles and clothing industry of the other Party.

In order to facilitate legitimate trade, notwithstanding the need of effective control, the Parties undertake to:

- cooperate and exchange information on all issues concerning customs legislation and procedures, and in particular to deal promptly with problems faced by operators arising from measures covered by this Agreement,

- provide effective, non-discriminatory and prompt procedures enabling the right of appeal against customs and other agency administrative actions, ruling and decisions affecting import or export of goods,

- establish an appropriate consultation mechanism between customs administrations and traders on customs regulations and procedures,

- publish, as far as possible through electronic means, and publicise new legislation and general procedures related to customs, as well as any modification, no later than the entry into force of any such legislation and procedures,

- cooperate with a view to reaching a common approach to issues relating to customs valuation, in particular the elaboration of a "code of good practices" in relation to working methods and operational aspects, the use of indicative or reference indices, appropriate documentation to certify the accuracy of the customs value and the use of securities. The Parties agree to open negotiations on the "code of good practices" upon application of this Agreement and to conclude them as soon as possible.

--------------------------------------------------

ANNEX IV

Products subject to the suspension of the quantitative restrictions as referred to in Article 4(1) of this Agreement.

(The full product descriptions of the categories listed in this Annex are to be found in Annex I).

Categories:

1

2

2a

3

5

6

7

8

9

15

16

67

--------------------------------------------------

ANNEX V

TITLE I

CLASSIFICATION

Article 1

1. The competent authorities of the Community undertake to inform Serbia of any changes in the Combined Nomenclature (CN) before the date of their entry into force in the Community.

2. The competent authorities of the Community undertake to inform the competent authorities of Serbia of any decisions relating to the classification of products subject to the present Agreement, within one month of their adoption at the latest. Such communication shall include:

(a) a description of the products concerned;

(b) the relevant category and the related CN codes;

(c) the reasons which have led to the decision.

3. Where a decision on classification results in a change of classification practice or a change of category of any product subject to this Agreement, the competent authorities of the Community shall provide 30 days' notice, from the date of the Community's communication, before the decision is put into effect.

Products shipped before the date of entry into effect of the decision shall remain subject to the earlier classification practice, provided that the goods in question are presented for importation into the Community within 60 days of that date.

4. Where a Community decision on classification resulting in a change of classification practice or a change of categorisation of any product subject to this Agreement affects a category subject to quantitative restrictions, the Parties agree to enter into consultation in accordance with the procedures described in Article 8 of this Agreement with a view to honouring the obligation under the third subparagraph of Article 9(1) of this Agreement.

5. In case of divergent opinions between Serbia and the competent Community authorities at the point of entry into the Community on the classification of products covered by this Agreement, classification shall provisionally be based on indications provided by the Community, pending consultations in accordance with Article 8 of this Agreement with a view to reaching agreement on definitive classification of the product concerned.

TITLE II

ORIGIN

Article 2

1. Products originating in Serbia for export to the Community in accordance with the arrangements set out in this Agreement shall be accompanied by a certificate of origin issued by the Customs Administration of Serbia conforming to the model annexed to this Annex.

2. The certificate of origin shall be certified by the Customs Administration of Serbia, if the products in question can be considered products originating in Serbia within the meaning of the relevant rules in force in the Community.

3. However, the products in Group III may be imported into the Community in accordance with the arrangements established by this Agreement on production of a declaration by the exporter on the invoice or other commercial document relating to the products to the effect that the products in question originate in Serbia within the meaning of the relevant rules in force in the Community.

4. The certificate of origin referred to in paragraph 1 shall not be required for imports of goods covered by a movement certificate EUR. 1 issued in accordance with the relevant provisions of the autonomous tariff regime granted to Serbia by the Community.

Article 3

The certificate of origin shall be issued only on application having been made in writing by the exporter or, under the exporter's responsibility, by his authorised representative. The Customs Administration of Serbia shall ensure that the certificate of origin is properly completed and for this purpose they shall call for any necessary documentary evidence or carry out any check which they consider appropriate.

Article 4

Where different criteria for determining origin are laid down for products falling within the same category, the certificates or declarations of origin must contain a sufficiently detailed description of the goods on the basis of which the certificate was issued or the declaration drawn up.

Article 5

The discovery of slight discrepancies between the statements made in the certificate of origin and those made in the documents produced to the Customs Administration of Serbia for the purpose of carrying out the formalities for importing the products shall not, ipso facto, cast doubt upon the statements in the certificate.

TITLE III

DOUBLE-CHECKING SYSTEM

SECTION I

Exportation

Article 6

The Ministry of International Economic Relations of Serbia shall issue an export licence in respect of all consignments from Serbia of textile products subject to any definitive or provisional quantitative restrictions established under this Agreement, up to the relevant quantitative restrictions as may be modified by this Agreement, as well as of all consignments of textile products subject to a double-checking system without quantitative restrictions as provided for in it.

Article 7

1. For products subject to quantitative restrictions under this Agreement the export licence shall conform to the Model 1 annexed to this Annex and it shall be valid for exports throughout the customs territory to which the Treaty establishing the European Community applies.

2. Where quantitative restrictions have been introduced pursuant to this Agreement, each export licence must certify, inter alia, that the quantity of the product in question has been set off against the quantitative restriction established for the category of the products concerned and shall only cover one category of products subject to quantitative restrictions. It may be used for one or more consignments of the products in question.

3. For products subject to a double-checking system without quantitative restrictions the export licence shall conform to the Model 2 annexed to this Annex. It shall only cover one category of products and may be used for one or more consignments of the products in question.

Article 8

The competent authorities of the Community must be informed immediately of the withdrawal or modification of any export licence already issued.

Article 9

1. Exports of textile products subject to quantitative restrictions pursuant this Agreement shall be set off against the quantitative restrictions established for the year in which the shipment of the goods has been effected even if the export licence is issued after such shipment.

2. For the purpose of applying paragraph 1, shipment of goods is considered to have taken place on the date of their loading onto the exporting aircraft, vehicle or vessel.

Article 10

The presentation of an export licence, in application of Article 12 of this Annex, shall be effected not later than 31 March of the year following that in which the goods covered by the licence have been shipped.

SECTION II

Importation

Article 11

Importation into the Community of textile products subject to quantitative restrictions or to a double-checking system pursuant to this Agreement shall be subject to the presentation of an import authorisation.

Article 12

1. The competent authorities of the Community shall issue the import authorisation referred to in Article 11 of this Annex, within five working days of the presentation by the importer of the original of the corresponding export licence.

2. The import authorisations concerning products subject to quantitative restrictions under this Agreement shall be valid for six months from the date of their issue for imports throughout the customs territory to which the Treaty establishing the European Community is applicable.

3. The import authorisations for products subject to a double-checking system without quantitative restrictions shall be valid for six months from the date of issue for imports throughout the customs territory to which the Treaty establishing the European Community is applicable.

4. The competent authorities of the Community shall cancel the import authorisation already issued whenever the corresponding export licence has been withdrawn.

However, if the competent authorities of the Community are notified of the withdrawal or the cancellation of the export licence only after the importation of the products into the Community, the relevant quantities shall be set off against the quantitative restrictions established for the category and the quota year concerned.

Article 13

1. If the competent authorities of the Community find that the total quantities covered by export licences issued by the Ministry of International Economic Relations of Serbia for a particular category in any year exceed the quantitative restriction that may be established in accordance with the provisions of this Agreement for that category, as may be modified by the relevant provisions thereof, the said authorities may suspend the further issue of import authorisations. In this event, the competent authorities of the Community shall immediately inform the Ministry for International Economic Relations of Serbia and the special consultation procedure set out in Article 8 of this Agreement shall be initiated forthwith.

2. Exports of products of Serbian origin subject to quantitative restrictions or double-checking system and not covered by export licences of Serbia issued in accordance with the provisions of this Annex may be refused an import authorisation by the competent Community authorities.

However, without prejudice to Article 6 of this Agreement, if the import of such products is allowed into the Community by the competent authorities of the Community, the quantities involved shall not be set off against the appropriate quantitative restrictions established pursuant to this Agreement, without the express agreement of the Ministry for International Economic Relations of Serbia.

TITLE IV

FORM AND PRODUCTION OF EXPORT CERTIFICATES AND CERTIFICATES OF ORIGIN, AND COMMON PROVISIONS CONCERNING EXPORTS TO THE COMMUNITY

Article 14

1. The export licence and the certificate of origin may comprise additional copies duly indicated as such. They shall be made out in English or French. If they are completed by hand, entries must be in ink and in printed script.

These documents shall measure 210 x 297 mm. The paper used shall be white writing paper, sized, not containing mechanical pulp, and weighing not less than 25 g/m2. If the documents have several copies only the top copy, which is the original, shall be printed with the guilloche pattern background. This copy shall be clearly marked as "original" and the other copies as "copies". Only the original shall be accepted by the competent authorities of the Community as being valid for the purpose of export to the Community in accordance with the provisions of this Agreement.

2. Each document shall bear a standardised serial number, whether or not printed, by which it can be identified.

This number shall be composed of the following elements:

- a two-digit number identifying the exporting entity as follows: XS,

- AT = Austria

- BL = Benelux

- CY = Cyprus

- CZ = Czech Republic

- DE = Germany

- DK = Denmark

- EE = Estonia

- EL = Greece

- ES = Spain

- FI = Finland

- FR = France

- GB = United Kingdom

- HU = Hungary

- IE = Ireland

- IT = Italy

- LT = Lithuania

- LV = Latvia

- MT = Malta

- PL = Poland

- PT = Portugal

- SE = Sweden

- SI = Slovenia

- SK = Slovakia,

a one-digit number identifying quota year, corresponding to the last figure in the respective year, e.g. 4 for 2004, 5 for 2005, 6 for 2006 and 7 for 2007,

a two-digit number from 01 to 99, identifying the particular issuing office concerned in exporting entity,

a five-digit number running consecutively from 00001 to 99999 allocated to the intended Member State of customs clearance.

Article 15

The export licence and the certificate of origin may be issued after the shipment of the products to which they relate. In such cases they must bear the endorsement "délivré à posteriori" or the endorsement "issued retrospectively".

Article 16

1. In the event of a theft, loss or destruction of an export licence or a certificate of origin, the exporter may apply to the Ministry of International Economic Relations of Serbia in case of an export licence, or the Customs Administration of Serbia, in case of a certificate of origin, which issued the document for a duplicate to be made out on the basis of the export documents in his possession. The duplicate of any such certificate or licence so issued shall bear the endorsement "duplicata" or "duplicate".

2. The duplicate shall bear the date of the original export licence or certificate of origin.

TITLE V

ADMINISTRATIVE COOPERATION

Article 17

The Parties shall cooperate closely in the implementation of the provisions of this Annex. To this end, contacts and exchanges of views, including on technical matters, shall be facilitated by both Parties.

Article 18

In order to ensure the correct application of this Annex, the Parties offer mutual assistance for the checking of the authenticity and the accuracy of export licences and certificates of origin issued or of any declarations made within the terms of this Annex.

Article 19

Serbia shall transmit to the Community the names and addresses of the authorities competent to issue and verify the export licences and the certificates of origin, together with specimens of the stamps used by these authorities and specimen signatures of officials responsible for signing the export licences and the certificates of origin. Serbia shall also notify the Community of any change in this information.

Article 20

1. Subsequent verification of certificates of origin or export licences shall be carried out at random, or whenever the competent Community authorities have reasonable doubt as to the authenticity of the certificate or licence or as to the accuracy of the information regarding the true origin of the products in question.

2. In such cases, the competent authorities in the Community shall return the certificate of origin or the export licence or a copy thereof to the Ministry for International Economic Relations of Serbia in case of an export licence, or to the Customs Administration of Serbia, in case of a certificate of origin, giving, where appropriate, the reasons of form or substance which justify an enquiry. If the invoice has been submitted, such invoice or a copy thereof shall be attached to the certificate or to the licence or their copies. The authorities shall also forward any information that has been obtained suggesting that the particulars given on the said certificate or licence are inaccurate.

3. The provisions of paragraph 1 shall also apply to subsequent verifications of the declarations of origin provided for in Article 2 of this Annex.

4. The results of the subsequent verifications carried out in accordance with paragraphs 1 and 2 shall be communicated to the competent authorities of the Community within three months at the latest. The information communicated shall indicate whether the disputed certificate, licence or declaration applies to the goods actually exported and whether these goods are eligible for export under the arrangements established by this Agreement. The information shall also include at the request of the Community, copies of all the documentation necessary to fully determine the facts, and in particular the true origin of the goods.

5. Should such verifications reveal systematic irregularities in the use of declarations of origin, the Community may subject imports of the products in question to Article 2(1) of this Annex. For the purpose of subsequent verification of certificates of origin, copies of the certificates as well as any export documents referring to them shall be kept for at least two years by the issuing authority.

6. Recourse to the random verification procedure specified in this Article must not constitute an obstacle to the release into free circulation of the products in question.

Article 21

1. Where the verification procedure referred to in Article 20 of this Annex or where information available to the competent authorities of the Community or of Serbia indicates or appears to indicate that the provisions of this Agreement are being circumvented or infringed, the two Parties shall cooperate closely and with the appropriate urgency in order to prevent any such circumvention or infringement.

2. To this end, the Ministry for International Economic Relations of Serbia in case of an export licence, or the Customs Administration of Serbia, in case of a certificate of origin, shall, on their own initiative or at the request of the Community, carry out appropriate inquiries, or arrange for such inquiries to be carried out, concerning operations which are, or appear to the Community to be, in circumvention or infringement of this Annex. Serbia shall communicate the results of these inquiries to the Community, including any other pertinent information enabling the cause of the circumvention or infringement, including the true origin of the goods to be determined.

3. By agreement between the Parties, officials designated by the Community may be present at the inquiries referred to in paragraph 2.

4. In pursuance of the cooperation referred to in paragraph 1, the competent authorities of the Parties shall exchange any information considered by either of them to be of use in preventing circumvention or infringement of the provisions of this Agreement. These exchanges may include information on the production of textile products in Serbia and on the trade in the type of products covered by this Agreement between Serbia and third countries, particularly where the Community has reasonable grounds to consider that the products in question may be in transit across the territory of Serbia prior to their importation into the Community. This information may include at the request of the Community copies of all available relevant documentation.

5. Where the provisions of this Annex have not been applied correctly, the Community may take the measures set out in Article 6(3) of this Agreement, or any other appropriate measure.

Specimen of Certificate of Origin referred to in Article 2(1) of Annex V

Specimen of Export Licence referred to in Article 7(1) of Annex V, Model 1

Specimen of Export Licence referred to in Article 7(3) of Annex V, Model 2

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ANNEX VI

COTTAGE INDUSTRY AND FOLKLORE PRODUCTS ORIGINATING IN SERBIA

1. The exemption provided for in Article 12 of this Agreement in respect of cottage industry products shall apply to the following types of product only:

(a) fabrics woven on looms operated solely by hand or foot, being fabrics of a kind traditionally made in the cottage industry of Serbia;

(b) garments or other textile articles of a kind traditionally made in the cottage industry of Serbia obtained manually from the fabrics referred to above and sewn exclusively by hand without the aid of any machine;

(c) traditional folklore products of Serbia made by hand, in a list to be agreed between the Parties.

Exemption shall be granted in respect only of products covered by a certificate conforming to the specimen annexed to this Annex and issued by the Customs Administration of Serbia. These certificates must indicate the reasons justifying their issuance. The competent authorities of the Community will accept them after having checked that the products concerned have fulfilled the conditions established in this Annex. The certificates concerning the products envisaged in point (c) above must bear a stamp "FOLKLORE" marked clearly. In the case of a difference of opinion between the Parties concerning the nature of these products, consultations shall be held within one month in order to resolve these differences.

Should imports of any product covered by this Annex reach proportions liable to cause problems within the Community, consultations with Serbia shall be initiated as soon as possible, with a view to resolving the situation by the adoption if necessary of a quantitative restriction, in accordance with the procedure laid down in Article 8 of this Agreement.

2. Titles IV and V of Annex V shall apply mutatis mutandis to the products covered by paragraph 1 of this Annex.

Appendix to Annex VI

1.Exporter (name, full address, country)Exportateur (nom, adresse complète, pays)ORIGINAL2.No CERTIFICATE in regard to HANDLOOMS, TEXTILE HANDICRAFTS and TRADITIONAL TEXTILE PRODUCTS, of the COTTAGE INDUSTRY, issued in conformity with and under the conditions regulating trade in textile products with the European Community-----------------------------------------------CERTIFICAT relatif aux TISSUS TISSES SUR METIERS A MAIN, aux PRODUITS TEXTILES FAITS A LA MAIN, et aux PRODUITS TEXTILES RELEVANT DU FOLKLORE TRADITIONNEL, DE FABRICATION ARTISANALE, délivré en conformité avec et sous les conditions régissant les échanges de produits textiles avec la Communauté européenne.3.Consignee (name, full address, country)Destinataire (nom, adresse complète, pays)4.Country of originPays d'origine5.Country of destinationPays de destination6.Place and date of shipment - Means of transportLieu et date d'embarquement - Moyen de transport7.Supplementary detailsDonnées supplémentaires8.Marks and numbers - Number and kind of packages - DESCRIPTION OF GOODSMarques et numéros - Nombre et nature des colis - DESIGNATION DES MARCHANDISES9.QuantityQuantité10.fob value (1)Valeur fob (1)11.CERTIFICATION BY THE COMPETENT AUTHORITY - VISA DE L'AUTORITE COMPETENTEI, the undersigned, certify that the consignment described above includes only the following textile products of the cottage industry of the country shown in box No 4:(a)fabric woven on looms operated solely by hand or foot (handlooms) (2)(b)garments or other textile articles obtained manually from the fabrics described under a) and sewn solely by hand without the aid of any machine (handicrafts) (2)(c)traditional folklore handicraft textile products made by hand, as defined in the list agreed between the European Community and the country shown in box No 4.Je soussigné certifie que l'envoi décrit ci-dessus contient exclusivement les produits textiles suivants relevant de la fabrication artisanale du pays figurant dans la case 4:(a)tissus tissés sur des métiers actionnés à la main ou au pied (handlooms) (2)(b)vêtements ou autres articles textiles obtenus manuellement à partir de tissus décrits sous a) et cousus uniquement à la main sans l'aide d'une machine (handicrafts) (2)(c)produits textiles relevant du folklore traditionnel fabriqués à la main, comme définis dans la liste convenue entre la Communauté européenne et le pays indiqué dans la case 4.12.Competent authority (name, full address, country)Autorité compétente (nom, adresse complète, pays)At - A …………………………, on - le…………………………………(Signature) (Stamp - Cachet)(1)In the currency of the sale contract - Dans la monnaie du contrat de vente.(2)Delete as appropriate - Biffer la (les) mention(s) inutile(s)

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ANNEX VII

DECLARATION BY THE COMMUNITY

The Community undertakes to assist Serbia with questions which may arise from the application of the provisions of this Agreement in the context of Serbia's accession to the WTO.

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