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Ref : ESA/EPA/Draft working text/August/2008

AUGUST 2008

Original: ENGLISH

EASTERN AND SOUTHERN AFRICA COUNTRIES

ECONOMIC PARTNERSHIP NEGOTIATIONS

TEXT

2008 (rkk)

ESA/EPA/Draft working text/August/2008

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PREAMBLE

[We the ACP States of the Eastern and Southern African (ESA) region, constituted as the ESA Group and its individual member countries, on one hand, and the European Union, its Member States and the European Commission, on the other, herein referred to as “The Parties”;

Having regard to the Cotonou Partnership Agreement (CPA) signed on 23 June 2000, the COMESA Treaty signed: on 5 November 1993, the SADC Treaty and Protocol on Trade; the EAC Treaty, and the African Union Constitutive Act signed on….…,

Having regard to the Treaty Establishing the European Community (EC).

Having also regard to the decision of the 8th Summit of COMESA Authority of Heads of State and Government held in Khartoum, Sudan on 17 th March 2003 on the establishment of the ESA configuration for the purpose of negotiation of an Economic Partnership Agreement (EPA) with the European Union;

Considering that the ESA States and the EU are agreed that their trade and economic cooperation shall aim at fostering the smooth and gradual integration of the ACP states into the world economy with due regard to their political choices, levels of development and development priorities, thereby promoting their sustainable development and contributing to poverty eradication in the ESA countries;

Reaffirming their commitment to promote and expedite the economic, cultural and social development of the ESA Countries with a view to contributing to peace and security and to promoting a stable and democratic political environment conducive for sustainable national and regional development;

Reaffirming also that the EPA shall be consistent with the objectives and principles of the Cotonou Partnership Agreement and, in particular, with the provisions of Part III, Title II thereof

Reaffirming that the EPA must serve as an instrument of development and shall promote sustained growth, increase the production and supply-side capacity of ESA countries, foster structural transformation of ESA economies and their diversification and competitiveness and lead to the development of trade, attraction of investment, technology and creation of employment in ESA countries;

Reaffirming that economic and trade cooperation shall build on regional integration initiatives of the ESA countries;

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Reaffirming the need for sustained peace and stability as crucial factors for the effective implementation of regional integration towards which the EPA is expected to contribute;

Recalling the commitments of the international community on the achievement of the Millennium Development Goals as contained in the UN Declaration of September 2000;

Reaffirming that advancing the development agenda requires genuine international cooperation and the full implementation of agreed commitments made at Conferences of Rio, Beijing, Copenhagen, Cairo and Monterrey, as well as in the Programmes of Action in favour of LDCs, LLDCs and SIDS respectively

BEARING in mind the rights and obligations of the Members of the WTO, the importance they attach to the principles and rules governing international trade and the need for a transparent, predictable, open and fair multilateral trading system

Whereas the Parties have agreed that EPAs shall take account of the differences in economic and social development levels of ESA countries and EU Member States, and that economic and trade cooperation shall be directed at enabling the ESA States to manage the challenges of globalization and to adapt progressively to new conditions of international trade and thereby facilitate their transition to the liberalised global economy.

Reiterating the need to ensure that particular emphasis shall be placed on regional integration and the provision of special and differential treatment to all ESA Countries, maintain special treatment for least developed ESA Countries, and take due account of the vulnerability of small economies, landlocked, island, coastal, drought prone and ESA Countries emerging from conflict.

Cognizant that substantial investments are required to uplift the standards of living of ESA countries;

Recalling the commitments of the Parties within the framework of the World Trade Organisation (WTO);

HAVE AGREED AS FOLLOWS

INTERPRETATION/DEFINITIONS (To be completed)]


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This part is taken from the Djibouti Dec 2007

PART I

GENERAL PROVISIONS

TITLE I

OBJECTIVES AND PRINCIPLES

Article 1Objectives

1. To promote and expedite the economic, cultural and social development of the ESA Countries, and with a view to contributing to peace and security and to promoting a stable and democratic political environment as well as regional integration

2. The overall objective of EU-ESA Economic Partnership Agreement (EPA) shall be the attainment of sustainable development of ESA Countries, their smooth and gradual integration into the global economy and the eradication of poverty and diseases

3. The specific objectives of the EPA shall be:

(a) To promote regional integration, economic cooperation and in the ESA region;

(b) to promote sustained growth, increase the production, supply and trading capacity of ESA Countries, as well as the capacity to attract investment and technology and create more employment, foster the structural transformation of ESA economies and their diversification, improve competitiveness and support regional integration initiatives in the ESA region through establishment and implementation of effective, predictable and transparent regional regulatory framework for trade and investment in the ESA region, thus creating the conditions

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(c) enable the ESA region to fully participate in international trade. To this end, the Parties shall cooperate closely in identifying and furthering their common interests in international economic and trade cooperation in particular in the WTO.

(d) Enhance cooperation in all areas relevant to trade and to achieve progressive liberalisation of mutual trade in accordance with WTO rules, taking into account the existing and potential export interest of ESA countries and of the impact of trade liberalisation measures in particular on regional integration within ESA region.

(e) Increase trade between the ESA region and the EU by addressing all forms of tariffs and NTBs that constrain trade.

Article 2

Principles

1. The ESA-EU Economic Partnership Agreement shall be underpinned by the following fundamental principles:

(a) The ESA countries shall determine their development models and strategies for their economies and societies in all sovereignty. The partnership shall encourage ownership of the development strategies by the countries and populations concerned;

(b) The partnership shall be broad-based in order to ensure ownership as well as economic political and social sustainability. In this regard EPA shall involve all stakeholders, including the private sector, civil society and parliamentarians.

(c) Consultations. Dialogue shall play a important pivotal role in the fulfilment of mutual obligations and cooperation relations between the Parties; and

(d) Cooperation arrangements and priorities as well as the capacity to assume obligations arising from this Agreement shall be in accordance with the Parties’ level of development, needs and long-term development strategy.

(e) The parties confirm strong commitment to ensure that actions are taken and necessary resources are made available in an


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appropriate way such that EPA succeeds as a development instrument.

2. The ESA-EU partnership shall be guided by the following specific principles:

(a) [Economic reforms by ESA countries shall be based on stages of ESA countries’ development within a specific time frame. The stages of development shall be identified by setting benchmarks that will be milestones that once achieved, a set of reforms including tariff dismantling shall take place. The benchmarks shall be derived from respective ESA countries national and regional development plans].

(b) The EPA shall support regional integration initiatives existing within the ESA region. EPA shall be based on the integration objectives of the ESA region. EPA shall also contribute to reinforcing regional integration, in particular by contributing to the regional harmonisation of rules.

(c) EPA shall therefore initially build and consolidate ESA market before progressively removing barriers to trade with the EU taking into account

(d) regional integration at the African Continental level

(e) [The EPA shall maintain and improve the current level of preferential market access and ensure the preservation of Cotonou acquis;]

(f) The EPA shall, where applicable, be compatible with WTO rules prevailing at the time of entry into force of this Agreement; and shall take into account the evolutionary nature of the WTO rules

(g) The EPA shall take account of the different needs and levels of development of the ESA countries;

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(h) The Parties reaffirm their commitment to maintaining and ensuring special treatment for ESA LDCs and to taking due account of the vulnerability and specificity of small, landlocked, island and ESA countries in conflict and post conflict situations as well as drought-prone ESA Countries;

(i) The EPA shall address the needs and concerns of ESA net food- importing and heavily indebted non-LDCs, small economies and single commodity producers

(j) ESA countries shall remove progressively barriers to trade on the basis of the principle of asymmetry taking into account their level of development as well as the ESA regional integration process and agenda; and

(k) The implementation of the EPA shall be guided by the principle of regional preference.

TITLE II

GENERAL PROVISIONS FOR LDCs, LANDLOCKED,

ISLAND AND COASTAL COUNTRIES

Article 3

1. To enable these categories of ESA Countries to take full advantage of the opportunities offered by this Agreement so as to step up their respective rates of development, cooperation shall ensure special treatment for least developed ESA countries and shall take due account of the vulnerability of landlocked, coastal, and island ESA countries. It shall also take into account the needs of countries in conflict and post conflict situations.

SCOPE OF THE AGREEMENT

Article 4

Scope

1. The agreement shall cover trade cooperation, trade related issues, trade in services, fisheries, economic and development cooperation, development cooperation, institutional framework and final provisions, dispute settlement

2. These provisions are concluded with a view to increasing production, supply and trading capacities of ESA countries through the enhancement of their capacity to attract investment and technology and create more employment and thus promote sustained growth and foster the structural transformation of ESA


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economies and their diversification, improve competitiveness and support regional integration and initiatives.

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This part is taken from interim agreement including the various changes so far

CHAPTER II

TRADE REGIME FOR GOODS

TITLE I

GENERAL PROVISIONSARTICLE 5

Objectives

The objectives of cooperation in the area of trade are:

(a) the provision of full duty free and quota free market access conditions for goods originating in the ESA States into the market of the EC party on a secure, long term and predictable basis;

(b) the promotion of trade between the Parties and the acceleration of export led growth to enable the integration of ESA countries into the global economy;

(c) the progressive and gradual liberalisation of goods market in ESA in accordance with the modalities established in this Agreement; and

(d) preservation and improvement of market access conditions to ensure that all ESA Member States are better and not worse off.

ARTICLE 6

Scope of application

1. Only the Signatory ESA States listed in Annex II shall take commitments under this Chapter.

2. The EC Party's commitments under this Chapter shall only be applicable to goods originating in the Signatory ESA States listed in Annex II.

3. For the purposes of this Chapter and for decisions adopted under this Chapter any reference to the Signatory ESA State or to goods originating in the ESA Signatory States shall extend only to the Signatory ESA States listed in Annex II.

4. When a Signatory ESA State not listed in Annex II wants to join Chapter II, it shall notify its intention to the EPA Committee. The EPA Committee is competent to amend Annex II.

5. The EPA Committee may decide on any transitional measures or amendments that might be necessary in order to facilitate the addition of such Signatory ESA State to Annex II.


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TITLE II

FREE MOVEMENT OF GOODS

ARTICLE 7

Customs duty

For the purposes of elimination of customs duties on imports, a customs duty shall include any duty or charge of any kind imposed on or in connection with the importation of goods, including any form of surtax or surcharge in connection with such importation, but does not include:

a) charges equivalent to internal taxes levied on both imported and locally produced goods consistent with the provisions of Article 18;

b) anti-dumping or countervailing duties applied in accordance with the provisions of Article 19, and safeguard measures applied in accordance with Article 21; and

c) fees or other charges levied in accordance with the provisions of Article 10.

ARTICLE 8

Classification of goods

The classification of goods in trade covered by this Agreement shall be that set out in each Party’s respective tariff nomenclature in conformity with the Harmonised Commodity Description and Coding System (“HS”). The Signatory ESA States will use the COMESA nomenclature.

ARTICLE 9

Basic Duty

For each product, the basic customs duty to which the successive reductions are to be applied shall be that specified in each Party's Tariff Schedules.

ARTICLE 10

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Fees and other charges

Fees and other charges referred to in Article 7(c), shall be limited in amount to the approximate cost of services rendered and shall not represent an indirect protection for domestic products or a taxation of imports for fiscal purposes. They shall be based on specific rates. Trade related fees and charges shall not be imposed for consular services.

ARTICLE 11

Customs duties on products originating in the ESA States

Products originating in the ESA States shall be imported into the EC Party free of customs duties, and under the conditions defined in Annex I.

ARTICLE 12

Customs duties on products originating in the EC Party

1 Customs duties on imports of products originating in the EC Party shall be reduced or eliminated in accordance with the schedules of tariff liberalization in Annex II which shall contain the schedules of each Signatory ESA State or group of Signatory ESA States.

2 The Parties may review the schedules of tariff liberalisation in Annex II with a view to harmonising them taking into account regional integration processes.

3 Any new schedule of tariff liberalisation for customs duties on imports of products originating in the EC Party submitted after the ratification process of this Agreement has commenced may be annexed to this Agreement in Annex II by decision of the EPA Committee.

ARTICLE 13

Rules of origin

For the purposes of this Chapter, "originating" means qualifying under the rules of origin set out in Protocol 1 to this Agreement. For the purpose of the comprehensive EPA, and during the period between the entry into force of this agreement and entry into force of the comprehensive EPA, the Parties shall review the provisions of this Protocol with a view to their further simplification. In such review the Parties shall take into account the development needs of the ESA States and development of technologies, production processes and all other factors, including on-going reforms of rules of origin, which may require


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modifications to the provisions of this Protocol. Any such modifications shall be effected by a decision of the EPA Committee.

ARTICLE 14

Standstill

Subject to Article 12, the Parties agree not to increase their applied customs duties on products imported from the other Party.

ARTICLE 15

Duties, taxes on exports

1. Except as otherwise provided in Annex III and for the duration of this Agreement, the Parties shall not institute any new duties or taxes on or in connection with the exportation of goods to the other Party in excess of those imposed on like products destined for internal sale.

2. The EPA Committee may examine a request from any Signatory ESA State for a review of the goods listed in Annex III.

ARTICLE 15

Duties, taxes on exports and quantitative restrictions

1. The Parties shall not institute any new duties or taxes on or in connection with the exportation of goods to the other Party in excess of those imposed on like products destined for internal sale.

2. All prohibitions or restrictions in trade on the importation, exportation or sale for export between the Parties, other than customs duties, taxes, fees and other charges provided for under Article 7, whether made effective through quotas, import or export licenses or other measures, shall be eliminated upon the entry into force of this Agreement.

3. Notwithstanding paragraph 1 and 2, the Signatory ESA State can impose a duty or tax in connection with the exportation of goods, or impose prohibitions or restrictions in trade on the importation, exportation or sale for export between the Parties, under the following circumstances:

(a) to foster the development of domestic industries;

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(b) to relieve critical shortages of foodstuffs or other products essential to the Signatory ESA State;

(c) to maintain currency value stability, when the increase in the world price of an export commodity creates the risk of a currency value surge;

(d) in pursuance of obligations under any intergovernmental commodity agreement which is not disapproved by WTO members;

(e) for environmental protection;

(f) restrictions necessary to the application of standards or regulations for the classification, grading or marketing of commodities in international trade; and for fiscal purposes.

ARTICLE 16

More favourable treatment resulting from free trade agreements1. With respect to the subject matter covered by this Chapter, the EC Party shall accord to the Signatory ESA States any more favourable treatment applicable as a result of the EC Party becoming party to a free trade agreement with third parties after the signature of this Agreement.

2. With respect to the subject matter covered by this Chapter, the Signatory ESA States shall accord to the EC Party any more favourable treatment applicable as a result of the Signatory ESA States becoming party to a free trade agreement with any major trading country after the signature of this Agreement.

3. The provisions of this Chapter shall not be so construed as to oblige the Parties to extend reciprocally any preferential treatment applicable as a result of the one of them being party to a free trade agreement with third parties on the date of signature of this Agreement.

4. The provisions of paragraph 2 shall not apply in respect of trade agreements between Signatory ESA States with other African countries and other developing countries and regions.

5. For the purposes of this Article, 'free trade agreement' means an agreement substantially liberalizing trade and providing for the absence or elimination of substantially all discrimination between or among parties thereto through the elimination of existing discriminatory measures and/or the prohibition of new or more discriminatory measures, either at the entry into force of that agreement or on the basis of a reasonable time frame.

6. For the purposes of this Article, 'major trading economy' means any developed country, or any country accounting for a share of world merchandise


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exports above 1 percent in the year before the entry into force of the economic integration agreement referred to in paragraph 2, or any group of countries acting individually, collectively or through an economic integration agreement accounting collectively for a share of world merchandise exports above 1.5 percent in the year before the entry into force of the economic integration agreement referred to in paragraph 2.1

TITLE III

NON-TARIFF MEASURES

ARTICLE 17

Prohibition of quantitative restrictions

Except as otherwise specified in Annexes I and II of this Agreement, all prohibitions or restrictions in trade on the importation, exportation or sale for exports between the Parties, other than customs duties, taxes, fees and other charges provided for under Article 7, whether made effective through quotas, import or export licenses or other measures, shall be eliminated upon the entry into force of this Agreement. No new such measures shall be introduced.

ARTICLE 18

National treatment on internal taxation and regulation

1. Imported products originating in the other Party shall not be subject, either directly or indirectly, to internal taxes or other internal charges of any kind in excess of those applied, directly or indirectly, to like national products. Moreover, the Parties shall not otherwise apply internal taxes or other internal charges so as to afford protection to national production.

2. Imported products originating in the other Party shall be accorded treatment no less favourable than that accorded to like national products in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use. The provisions of this paragraph shall not prevent the application of differential internal transportation charges which are based exclusively on the economic operation of the means of transport and not on the nationality of the product.

1 For this calculation official data by the WTO on leading exporters in world merchandise trade (excluding intra-EU trade) shall be used.

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3. No Party shall establish or maintain any internal quantitative regulation relating to the mixture, processing or use of products in specified amounts or proportions which requires, directly or indirectly, that any specified amount or proportion of any product which is the subject of the regulation must be supplied from domestic sources. Moreover, no Party shall otherwise apply internal quantitative regulations so as to afford protection to national production.

4. The provisions of this Article shall not prevent the payment of subsidies exclusively to national producers, including payments to national producers derived from the proceeds of internal taxes or charges applied consistently with the provisions of this Article and subsidies effected through governmental purchases of national products.

5. The provisions of this Article shall not apply to laws, regulations, procedures or practices governing public procurement.

6 The EPA Committee may decide to authorise a Signatory ESA State to depart from the provisions of this Article to promote the establishment of domestic production and protect infant industry. In this respect the development needs of Signatory ESA States and, in particular, the special needs and concerns of ESA LDCs will be taken into account.

7 A list of provisional derogations is attached as Annex III. Such derogations are granted to the interested Signatory ESA States for the periods of time which are set out in the same Annex.

TITLE IV

TRADE DEFENCE MEASURES

ARTICLE 19

Anti-dumping and countervailing measures

1. Subject to the provisions of this Article, nothing in this Agreement shall prevent the EC Party or Signatory ESA States, whether individually or collectively, from adopting anti-dumping or countervailing measures in accordance with the relevant WTO agreements. For the purpose of this Article, origin shall be determined in accordance with the non-preferential rules of origin of the Parties.

2. Before imposing definitive anti-dumping or countervailing duties in respect of products imported from ESA States, the EC Party shall consider the possibility of constructive remedies as provided for in the relevant WTO agreements.


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3. Where an anti-dumping or countervailing measure has been imposed on behalf of two or more Signatory ESA States by a regional authority, there shall be one single forum of judicial review, including at the stage of appeals.

4. Where anti-dumping or countervailing measures can be imposed on a regional or sub-regional basis and on a national basis the Parties shall ensure that such measures are not applied simultaneously in respect of the same product by regional or sub-regional authorities on the one hand, and national authorities on the other.

5. The EC Party shall notify the exporting Signatory ESA States of the receipt of a properly documented complaint before initiating any investigation.

6. The provisions of this Article shall be applicable in all investigations initiated after this Agreement enters into force.

7. The provisions of this Article shall not be subject to the Dispute Settlement provisions of this Agreement.

ARTICLE 20

Multilateral safeguards

1. Subject to the provisions of this Article, nothing in this Agreement shall prevent the Signatory ESA States and the EC Party from adopting measures in accordance with Article XIX of GATT 1994, the WTO Agreement on Safeguards, and Article 5 of the Agreement on Agriculture. For the purpose of this Article, origin shall be determined in accordance with the non-preferential rules of origin of the Parties.

2. Notwithstanding paragraph 1, the EC Party shall, in the light of the overall development objectives of this Agreement and the small size of the economies of the ESA States, exclude imports from any ESA State from any measures taken pursuant to Article XIX of the GATT 1994, the WTO Agreement on Safeguards and Article 5 of the Agreement on Agriculture.

3. The provisions of paragraph 2 shall apply for a period of five years, beginning with the date of entry into force of the Agreement. Not later than 120 days before the end of this period, the EPA Committee shall review the operation of those provisions in the light of the development needs of the ESA States, with a view to determining whether to extend their application for a further period.

4. The provisions of paragraph 1 shall not be subject to the Dispute Settlement provisions of this Agreement.

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ARTICLE 21

Bilateral safeguards

1. After having examined alternative solutions, a Party may apply safeguard measures of limited duration which derogate from the provisions of Articles 11, 12 and 17, under the conditions and in accordance with the procedures laid down in this Article.

2. Safeguard measures referred to in paragraph 1 above may be taken where a product originating in one Party is being imported into the territory of the other Party in such increased quantities and under such conditions as to cause or threaten to cause:

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

(b) disturbances in a sector of the economy, particularly where these disturbances produce major social problems, or difficulties which could bring about serious deterioration in the economic situation of the importing Party, or

(c) disturbances in the markets of agricultural like or directly competitive products2 or mechanisms regulating those markets.

3. Safeguard measures referred to in this Article shall not exceed what is necessary to remedy or prevent the serious injury or disturbances, as defined in paragraph 2 and 5(b). Those safeguard measures of the importing Party may only consist of one or more of the following:

(a) suspension of the further reduction of the rate of import duty for the product concerned, as provided for under this Agreement,

(b) increase in the customs duty on the product concerned up to a level which does not exceed the customs duty applied to other WTO Members, and

(c) introduction of tariff quotas on the product concerned.

4. Without prejudice to paragraph 1, 2 and 3 above, where any product originating in one or more Signatory ESA State or subgroup is being imported in such increased quantities and under such conditions as to cause or threaten to cause one of the situations referred to under paragraphs 2(a), (b) and (c) above

2 For the purpose of this article agricultural products are those covered by Annex I of the WTO Agreement on Agriculture.


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to one or several of the EC Party's outermost regions, the EC Party may take surveillance or safeguard measures limited to the region or regions concerned in accordance with the procedures laid down in paragraphs 6 to 9.

5. (a) Without prejudice to paragraph 1, 2 and 3 above, where any product originating in the EC Party is being imported in such increased quantities and under such conditions as to cause or threaten to cause one of the situations referred to under 2(a), (b) and (c) above to a Signatory ESA State, the Signatory ESA State concerned may take surveillance or safeguard measures limited to its territory in accordance with the procedures laid down in paragraphs 6 to 9.

(b) A Signatory ESA State may take safeguard measures where a product originating in the EC Party as a result of the reduction of duties is being imported into its territory in such increased quantities and under such conditions as to cause or threaten to cause disturbances to an infant industry producing like or directly competitive products. Such provision is only applicable for a period of ten years for non LDCs and fifteen years for LDCs from the date of entry into force of this Agreement. Measures must be taken in accordance with the procedures laid down in paragraphs 6 to 9.

6. (a) Safeguard measures referred to in this Article shall only be maintained for such a time as may be necessary to prevent or remedy serious injury or disturbances as defined in paragraphs 2, 4 and 5 above.

(b) Safeguard measures referred to in this Article shall not be applied for a period exceeding two years. Where the circumstances warranting imposition of safeguard measures continue to exist, such measures may be extended for a further period of no more than two years. Where the Signatory ESA States or a Signatory ESA State apply a safeguard measure, or where the EC Party applies a measure limited to the territory of one or more of its outermost regions, such measure may however be applied for a period not exceeding four years and, where the circumstances warranting imposition of safeguard measures continue to exist, extended for a further period of four years.

(c) Safeguard measures referred to in this Article that exceed one year shall contain clear elements progressively leading to their elimination at the end of the set period, at the latest.

(d) No safeguard measure referred to in this Article shall be applied to the import of a product that has previously been subject to such a measure, for a period of at least one year since the expiry of the measure.

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7. For the implementation of the above paragraphs, the following provisions shall apply:

a) Where a party takes the view that one of the circumstances set out in paragraphs 2, 4 and/or 5 exists, it shall immediately refer the matter to the EPA Committee for examination;

b) The EPA Committee may make any recommendation needed to remedy the circumstances which have arisen. If no recommendation has been made by the EPA Committee aimed at remedying the circumstances, or no other satisfactory solution has been reached within 30 days of the matter being referred to the EPA Committee, the importing party may adopt the appropriate measures to remedy the circumstances in accordance with this Article;

c) Before taking any measure provided for in this Article or, in the cases to which paragraph 8 of this Article applies, as soon as possible, the Party or the signatory ESA State concerned shall supply the EPA Committee with all relevant information required for a thorough examination of the situation, with a view to seeking a solution acceptable to the Parties concerned;

d) In the selection of safeguard measures pursuant to this Article, priority must be given to those which least disturb the operation of this Agreement;

e) Any safeguard measure taken pursuant to this Article shall be notified immediately to the EPA Committee and shall be the subject of periodic consultations within that body, particularly with a view to establishing a timetable for their abolition as soon as circumstances permit.

8. Where exceptional circumstances require immediate action, the importing party concerned, whether the EC Party, the ESA States or a Signatory ESA State as the case may be, may take the measures provided for in paragraph 3, 4 and/or 5 on a provisional basis without complying with the requirements of paragraph 7. Such action may be taken for a maximum period of 180 days where measures are taken by the EC Party and 200 days where measures are taken by the ESA States or a Signatory ESA State, or where measures taken by the EC Party are limited to the territory of one or more of its outermost regions. The duration of any such provisional measure shall be counted as a part of the initial period and any extension referred to in paragraph 6. In the taking of such provisional measures, the interest of all Parties involved shall be taken into account. The importing party concerned shall inform the other party concerned and it shall immediately refer the matter to the EPA Committee for examination.


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9. If an importing party subjects imports of a product to an administrative procedure having as its purpose the rapid provision of information on the trend of trade flows liable to give rise to the problems referred to in this Article, it shall inform the EPA Committee without delay.

10. The WTO Agreement shall not be invoked to preclude a Party from adopting safeguard measures in conformity with this Article.

[Articlexxx

Special Agricultural Safeguard

5. Notwithstanding the above paragraphs, if given the sensitivity of agricultural markets, imports of agricultural products originating in the Community cause or threaten to cause serious injury in the markets of ESA , the Parties shall immediately consider the matter to find an appropriate solution. Pending a decision by the parties and where exceptional circumstances require immediate action, ESA shall take provisional measures necessary to limit or redress the injury.

6. In the event that subsidies provided by the Community cause or threaten to cause material injury to the domestic industry producing like or directly competitive products in any of the ESA Member States, the latter shall take the necessary measures to remedy the situation through the imposition of countervailing duties equivalent to the margin of the [export] subsidy.

7. In the event of;

(a) a decrease in the price by (x%) of a product over the reference period 2001 to 2002, or,

(b) an increase in the volume of trade in a product by 10% as compared to the previous year,

as a result of the tariff concessions granted by the ESA member States, a special safeguard clause shall apply in the form of an additional duty equivalent up to a maximum MFN duty of the ESA member concerned by that product.]

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ESA proposal

Article xxx infant industry

A Signatory ESA State may take safeguard measures where a product originating in the EC Party as a result of the reduction of duties is being imported into its territory in such increased quantities and under such conditions as to cause or threaten to cause disturbances to an infant industry producing like or directly competitive products. Such provision is only applicable for a period of ten years from the date of entry into force of this Agreement. Measures must be taken in accordance with the procedures laid down in paragraphs 6 to 9.]

TITLE V

ADMINISTRATIVE PROVISIONS

ARTICLE 22

Special provision on administrative cooperation

1. The Parties agree that administrative co-operation is essential for the implementation and the control of the preferential treatment granted under this Chapter and underline their commitment to combat irregularities and fraud in customs and related matters.

2. Where a Party has made a finding, on the basis of objective information, of a failure to provide administrative co-operation and/or of irregularities or fraud, the Party concerned may temporarily suspend the relevant preferential treatment of the product(s) concerned in accordance with this Article.

3. For the purpose of this Article a failure to provide administrative co-operation shall mean, inter alia:

a) a repeated failure to respect the obligations to verify the originating status of the product(s) concerned;

b) a repeated refusal or undue delay in carrying out and/or communicating the results of subsequent verification of the proof of origin;

c) a repeated refusal or undue delay in obtaining authorisation to conduct administrative co-operation missions to verify the authenticity of documents or


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accuracy of information relevant to the granting of the preferential treatment in question,

4. For the purpose of this Article a finding of irregularities or fraud may be made, inter alia, where there is a rapid increase, without satisfactory explanation, in imports of goods exceeding the usual level of production and export capacity of the other Party that is linked to objective information concerning irregularities or fraud.

5. The application of a temporary suspension shall be subject to the following conditions:

a) The Party which has made a finding, on the basis of objective information, of a failure to provide administrative co-operation and/or of irregularities or fraud shall without undue delay notify the EPA Committee of its finding together with the objective information and enter into consultations within the EPA Committee, on the basis of all relevant information and objective findings, with a view to reaching a solution acceptable to both Parties.

b) Where the Parties have entered into consultations within the EPA Committee as above and have failed to agree on an acceptable solution within 3 months following the notification, the Party concerned may temporarily suspend the relevant preferential treatment of the product(s) concerned. A temporary suspension shall be notified to the EPA Committee without undue delay.

c) Temporary suspensions under this Article shall be limited to that necessary to protect the financial interests of the Party concerned. They shall not exceed a period of six months, which may be renewed. Temporary suspensions shall be notified immediately after their adoption to the EPA Committee. They shall be subject to periodic consultations within the EPA Committee in particular with a view to their termination as soon as the conditions for their application are no longer given.

6. At the same time as the notification to the EPA Committee under paragraph 5 a) of this Article, the Party concerned should publish a notice to importers in its Official Journal. The notice to importers should indicate for the product concerned that there is a finding, on the basis of objective information, of a failure to provide administrative co-operation and/or of irregularities or fraud.

ARTICLE 23

Management of administrative errors

In case of error by the competent authorities in the proper management of the preferential system of export, and in particular in the application of the provisions of the Protocol I concerning the definition of the concept of "originating products"

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and methods of administrative cooperation, where this error leads to consequences in terms of import duties, the Party facing such consequences may request the EPA Committee to examine the possibilities of adopting all appropriate measures with a view to resolving the situation.

ARTICLE 24

Customs Valuation

1. Article VII of GATT 1994 and the Agreement on the implementation of Article VII of GATT 1994 shall govern customs valuation rules applied to reciprocal trade between the Parties.

2. The Parties shall cooperate with a view to reaching a common approach to issues relating to customs valuation.


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Joint text discussed in Brussels June 2008

ESA-EC joint draft SPS Chapter

version 22 February 2008 sent to ESA in April

TITLE [VII]

SANITARY AND PHYTOSANITARY MEASURES

ARTICLE [30]Scope and Coverage

1. This Title applies to measures covered by the World Trade Organisation Agreement on the Application of Sanitary and Phytosanitary Measures (the WTO SPS Agreement).

2. Cooperation should be centred on, but not limited to, mutually agreed priority sectors and products, listed in annexes [A] intra-regional trade and harmonisation, [B] ESA exports to the EU and [C] EU exports to ESA. These annexes shall be fully flexible and will be appropriately reviewed and modified in accordance with the provisions of [Article XX – should refer to the Article outlining the mandate of the

Article [31]

Objectives

The objectives of cooperation in sanitary and phytosanitary issues are to:

a) facilitate trade between the Parties and within the ESA region, whilst safeguarding human, animal and plant health or life in accordance with the WTO SPS Agreement;

b) address problems arising from SPS measures on agreed priority sectors and products giving due consideration to regional integration;

c) stipulate procedures and modalities for facilitating cooperation in SPS matters;

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d) facilitate access of ESA countries’ products to regional and EU markets [EC comment: EC can not give guarantees on an issue which is linked to markets]

e) ensure transparency as regards SPS measures applicable to trade between the Parties and within the ESA region trade;

f) promote intra-regional harmonisation of measures with international standards, in accordance with the WTO SPS Agreement, and the development of appropriate policies, legislative, regulatory and institutional frameworks within ESA;

g) enhance the effective participation of ESA countries in international standards setting organisations and processes;

h) promote consultation and exchanges between ESA and EU institutions and laboratories;

i) facilitate the development of capacity for setting and implementing regional and national standards in accordance with international requirements in order to facilitate regional integration;

j) to establish and enhance ESA technical capacity to implement and monitor SPS measures; and

k) facilitate the promotion of technology transfer.

ARTICLE [32]

Definitions

Unless otherwise stated, the definitions provided by the WTO SPS Agreement and relevant international standards-setting bodies shall apply.

Article [33]

Rights and Obligations

1. Each Party shall:


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a) have the sovereign right to implement sanitary and phytosanitary measures, provided that such measures are consistent with the provisions of the WTO SPS Agreement;

b) consult the other Party prior to the introduction of any new SPS measures, relevant for the products listed in annexes A, B and C, through the notification mechanisms provided for in the SPS Agreement, and if and when appropriate through the Parties’ contact points, ; [EC comment: the EC cannot give notification of new SPS measures prior to the mechanism provided for in the SPS Agreement, except on an ad hoc basis there may be consultations via other communication links, but this shall be the exception rather than the rule]

c) support each other in gathering information needed to make informed decisions;

d) promote linkages, joint ventures, and joint research and development between ESA and EU institutions and laboratories;

2. The Parties reaffirm their rights and obligations under the international treaties and agreements relating to this Title to which they are party.

Article [34]

Principles

Justification of Measures

Subject to the provisions of this Title, the Parties shall ensure that the introduction, alteration or modification of any sanitary and phytosanitary measure in their territories will be in accordance with the WTO SPS Agreement.

Harmonisation

1. The Parties shall aim to:

achieve harmonisation of their respective rules and procedures for formulation of their SPS measures, including inspection, testing and certification procedures, in accordance with the WTO SPS Agreement; [EC

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comment: this is already covered when saying it is in accordance with the SPS Agreement]

(a) [EC comment: is duplication of (a), so proposal to delete it]

(b) ESA will develop, with the support of the EC, a program and timeframe for harmonizing its SPS standards.

2. The [SPS Committee] shall develop modalities to assist and to monitor the process of harmonization within the regions, as appropriate. [EC comment: from the above articles there is no reference to an interregional harmonisation exercise, and it is not looked for, therefore proposal to delete "between"]

Equivalence and Zoning

1. The Parties shall apply the principles of equivalence according to the provisions of the SPS Agreement.

2. The Parties shall recognize on a case by case basis designated areas which are free from pests or diseases or areas of low pest or disease prevalence as potential sources of plant and animal productstaking into account Article 6 of the SPS Agreement.The principle of compartmentalization may apply with regard to livestock and livestock products, according to the above principle. [EC comment: the provisions of Art. 6 go beyond the limited provisions from international standards setting bodies and the EC cannot commit itself to limit itself to what is prescribed under these international standards]

Notification, Enquiry and Transparency

[EC Comment: proposal to delete this provision as ESA may not be able to comply]

1. The Parties shall be as transparent as possible in their application of SPS measures in accordance with the WTO SPS Agreement.

2. The EU shall assist the ESA to ensure the efficient operation of the notification process.

[EC comment: the EC rules on conformity assessment are very clear and transparent, however due to legal constraints the EC cannot agree to take on the commitments proposed, as previously highlighted. If the ACP Party wishes to


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make these commitments themselves, but do not want a unilateral commitment under this article, then the article should be deleted]

Article 35

Technical Assistance and Special and Differential Treatment

1. The EC reaffirms its obligations on Special and Differential Treatment in accordance with the WTO SPS Agreement in respect of ESA countries.

2. The Parties shall cooperate to address the special needs of ESA countries arising from the implementation of the EPA’s provisions on SPS.

3. The EU agrees to facilitate the provision of technical assistance and special and differential treatment in accordance with articles 9 and 10 of the WTO SPS Agreement.

ARTICLE 36

Areas of Cooperation

1. The Parties agree to cooperate in accordance with the [development chapter] to development and implementation of a quality programme, training, information events, the building, upgrading and modernisation and accreditation of laboratories.

3. For products referred to in [the Annex listing ESA priority sectors and products for ESA export to the EU], the Parties agree to cooperate with a view to facilitating the compliance of ESA produce with formal standards of the EU markets. It may also cover cooperation on matters concerning the work of the relevant international standards-setting bodies. This cooperation may include training, information events, capacity building and technical assistance.

4. In the area of fisheries cooperation shall also aim at developing harmonized regional rules, legislation and standards of fish products to promote trade between the Parties and within the ESA region,

Article 37

Information Exchange and Transparency of Trade Conditions

Cooperation shall include:

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1. Information sharing and consultation on changes to SPS measures which may affect products of export interest to either party. The Parties shall also exchange information on other areas of potential relevance to their trade relations, including rapid alerts, scientific opinions and events.

2. Advance notice to ensure that ESA countries are informed in advance of new SPS measures that may affect ESA exports to the EU. This system shall build on existing mechanisms, as appropriate. [EC comment: see previous comment on exchange of information on SPS measures]

3. Promotion of transparency as regards the sampling, analysis and action following official controls on feed and food from ESA countries.

ARTICLE 38COMPETENT AUTHORITIES

1. The respective SPS authorities of the Parties shall be the competent authorities in the ESA member states and the European Union for the implementation of the measures referred to in this Title.

2. The Parties shall, in accordance with this Agreement, notify each other of their respective competent SPS authorities and any changes thereto.

[EC comment: PROPOSAL TO DELETE THIS WHOLE ARTICLE (comment as above)]

ARTICLE 39

[Joint ESA-EC SPS Committee]

[Joint comment: the precise names of the different bodies referred to below, such as “SPS Committee” and “Joint Implementation Committee”, shall be determined in connection with the adoption of the final institutional framework for the EPA]

1. The Parties hereby establish a [SPS Committee] composed of the


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representatives of the Parties.

2. The Chairmanship of the [SPS Committee] shall be held alternately by each of the Parties.

3. The [SPS Committee] shall meet within the first year, after the entry into force of the SPS Title, and on request of either Party thereafter, not exceeding however a frequency of one meeting a year.

4. The [SPS Committee] shall have the following functions:

(a) to monitor the implementation of the SPS Title and consider any matter relating to this Title, and examine all matters which may arise in relation to its implementation;

(b) to provide a mechanism of cooperation, namely on activities concerning exchange of information and transparency of trade conditions;

(c) to provide advice to competent Commission Services and Authorizing Officers on needs and priorities for activities to be pursued within the framework of bilateral and regional indicative programs or other project facilities. Existing structures of collaboration and communication must be exploited whenever possible;

(d) to review the Appendices to this Title i.e. including the lists of priority products, notably in the light of progress made under the consultations and procedures provided for under this Title; and

(e) to make recommendations for modifications to this Title as appropriate.

5. The Parties agree to establish technical working groups, when appropriate, consisting of expert-level representatives of the Parties, which shall identify and address technical and scientific issues arising from the application of this Title. When additional expertise is required, the Parties may establish ad hoc groups, including scientific groups. Membership of such ad hoc groups may include independent experts.

6. Where appropriate the [SPS Committee], technical working groups and ad hoc groups will cooperate with other ACP EPA Groups to promote a coordinated response to problems that do not respect regional borders.

7. The [SPS Committee] shall report to the [Joint Implementation Committee] on its activities. Recommendations for modification of this Title shall require the adoption of the [Joint Implementation Committee].

8. The [SPS Committee] shall adopt at its first meeting its working procedures.

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Joint draft TBT Title, 23 June 2008 Brussels

TITLE III

STANDARDS, TECHNICAL REGULATIONS

AND CONFORMITY ASSESSMENT

ARTICLE 42SCOPE AND COVERAGE

1. The provisions of this Title shall apply to the preparation, adoption and application of technical regulations, standards and conformity assessment, as defined in the WTO Agreement on Technical Barriers to Trade (TBT Agreement).

Article 43

Objectives

The objectives of cooperation in the areas of standards, technical regulations and conformity assessment between the Parties shall be:

a) the avoidance and reduction of technical barriers to trade, in order to facilitate trade between the Parties and within the ESA region;

b) to enhance regional integration among ESA countries by harmonising standards, technical regulations and conformity assessment procedures applied in the ESA region, in accordance with the WTO TBT Agreement;

c) to promote greater use of international technical regulations, standards and conformity assessment procedures, including sector specific measures;

d) to develop functional links, joint ventures and joint research and development work between ESA and EU standardisation, conformity assessment and regulatory institutions;

e) to enhance the market access for products from ESA countries through improvements in safety, quality and competitiveness of products;


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f) to promote greater use of international best practices for technical regulations, international standards and conformity assessment procedures;

g) to ensure that the preparation, adoption and application of standards and technical requirements are transparent and do not create unnecessary obstacles to trade between the Parties and within the ESA region, in accordance with the provisions of the WTO TBT Agreement;

h) development of appropriate regulatory framework and policies within the ESA region as well as regulatory reforms to meet internationally accepted practices; and

i) effective participation of the ESA institutions in international standards setting bodies and the WTO TBT Committee.

Article 44Definitions

For the purpose of this Title, the definitions of the WTO TBT Agreement shall apply.

Article 45Basic rights and obligations

1. The Parties reaffirm their rights and obligations under the WTO TBT Agreement, while taking account of their rights and commitments under other relevant international arrangements including those relating to the protection of biodiversity in particular and the environment in general.

2. The Parties shall ensure that technical regulations are not prepared, adopted or applied with a view to or with an effect of creating unnecessary obstacles to trade between the Parties or within the ESA region, subject to the provisions of the WTO TBT Agreement.

Article 46

Mutual Recognition Agreements

The Parties undertake to consider, in due course, negotiating mutual recognition agreements in sectors of mutual economic interest.

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Article 47

Principles

Transparency and Notification

1. The Parties reaffirm their obligations concerning the sharing of information about technical regulations, standards and conformity assessment procedures as provided for by the WTO TBT Agreement.

2. The Parties shall exchange information on issues of potential relevance to their trade relations, including rapid alerts, scientific opinions and events through contact points.

3. The Parties may co-operate in the establishment and maintenance of contact points, and in the setting up and maintenance of common data bases.

Article 48

Harmonization

The Parties shall endeavour to harmonize their standards, technical regulations and conformity assessment procedures.

Article 49Areas of Cooperation

The Parties agree to cooperate in the following areas of standards, technical regulations and conformity assessment:

(a) Promotion of greater use of international standards in technical regulations and conformity assessments, including sector specific measures, in the Parties’ territories;

(b) Support for ESA capacity building initiatives in the fields of standardization, conformity assessment and metrology;

(c) Cooperation in the area of quality management and assurance in selected sectors of importance to the ESA region;


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(d) promoting and enabling full participation in international standard setting bodies, and reinforcing the role of international standards as a basis for technical regulations;

(e) promoting efforts by ESA conformity assessment bodies to obtain international accreditation;

(f) Developing functioning links between ESA and European standardisation, conformity assessment and certification institutions;

(g) Developing common views on good regulatory practices, including, but not limited to:

i) Transparency in the preparation, adoption and application of technical regulations, standards and conformity assessment procedures;

ii) Necessity and proportionality of regulatory measures and related conformity assessment procedures, including the use of suppliers declaration of conformity;

iii) Use of international standards as a basis for setting up technical regulations, except where such international standards would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued;

iv) Enforcement of technical regulations and market surveillance activities;

v) Identifying and prioritising necessary technical infrastructure and transfer of technology, in terms of metrology, standardisation, testing, certification and accreditation, to support technical regulations; and

vi) Establishing mechanisms and methods for reviewing technical regulations and conformity assessment procedures.

(h) Enhancing regulatory, technical and scientific cooperation by inter alia, exchanging information, experiences and data, with a view to improving the quality and level of their technical regulations and making efficient use of regulatory resources;

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(i) Developing compatibility and convergence of their respective technical regulations, standards and conformity assessment procedures;

(j) Promoting and encouraging bilateral cooperation between their respective organisations responsible for metrology, standardisation, testing, certification and accreditation; and

(k) Increasing cooperation between the Parties and between ESA countries in relation to the work of relevant international institutions and organisations and fora dealing with the issues covered by this Title.

Article 50

Conformity Assessment

1. The Parties reaffirm their commitments on conformity assessment in accordance with the WTO TBT Agreement.

2. In due course, the Parties may consider, taking account of the extent of alignment of their technical regulations, standards, and conformity assessment infrastructure, the negotiation of agreements on the mutual recognition of conformity assessment procedures.

Article xxx (adopted from SADC EPA)

Measures for identifying, preventing and eliminating technical barriers to trade

The Parties agree to identify and implement mechanisms among those supported by the

TBT Agreement that are the most appropriate for particular priority issues or sectors.

Such mechanisms may include:

1. Intensifying their collaboration, with a view to facilitating access to their respective markets, by increasing the mutual knowledge and understanding of their respective systems in the field of technical regulations, standards, metrology, accreditation and conformity assessment;

2. Exchanging information, identifying and implementing appropriate mechanisms for particular issues or sectors, i.e. alignment to international


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standards, reliance on the supplier’s declaration of conformity, the use of internationally recognized accreditation to qualify conformity assessment bodies and the use of international product testing and certification schemes;

3. Identifying and organising sector-specific interventions on technical regulations and conformity assessment with a view to facilitating understanding of and access to their respective markets. These sectors will be chosen taking into account key areas of trade, including priority products;

4. Developing co-operation activities and measures with a view to support the implementation of the rights and obligations under the TBT Agreement;

5. Where appropriate, developing common views and approaches on technical regulatory practices, including transparency, consultation, necessity and proportionality, the use of international standards, conformity assessment requirements, the use of impact and risk assessment, enforcement and market surveillance;

6. Promoting harmonisation, whenever possible and in areas of mutual interest, towards international standards, and the use of such standards in the development of technical regulations and conformity assessment procedures;

7. Undertake to consider, in due course, negotiating mutual recognition agreements in sectors of mutual economic interest;

8. Promoting collaboration between the Parties' and ESA EPA States, as the case may be, organizations responsible for technical regulations, metrology, standardisation, testing, certification, inspection and accreditation; and

Article 52Management of the TBT Title

The [Committee on Trade Cooperation/Sub-Committee on TBT – establishment, name and position still subject to joint decision on the overall institutional arrangement] may address any matter related to the effective implementation of the provisions under this Title. In particular, it may:

(a) monitor and review the implementation of the provisions of this Title with a view to facilitating trade between the Parties and within the ESA region;

(b) provide a forum for discussion and exchange of information on the Parties' systems for technical regulations, standards and conformity assessment procedures, and developments in related international organisations, and for consultation between the Parties on issues that may act as unnecessary

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barriers to trade, so that such issues may be resolved at the earliest possible opportunity; and

(c) promote and facilitate complementary co-operation between the Parties' institutions and organisations for metrology, standardisation, testing, certification, inspection and accreditation.


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PART III

proposed merged esa-ec epa text

SERVICES

TITLE I

GENERAL PROVISIONS

Article XXX

1. The Parties underline the growing importance of services in international trade and their major contribution to economic and social development.

2. The Parties, reaffirming their commitments under the WTO Agreement and with a view to facilitate the regional integration and sustainable development of the ESA Signatory States and their smooth and gradual integration in the world economy, hereby lay down the necessary arrangements for the progressive, reciprocal and asymmetric liberalisation of trade in services and underline the need for special and differential treatment to ESA suppliers of services

3. In the framework of the negotiations for progressive liberalization in trade in services as provided for in GATS Article XIX, the Community undertakes to improve its commitments with a view to meeting the specific interests of ESA member states

4. The Parties further agree on the objectives of this Chapter, of extending their partnership to encompass the progressive liberalization of services in accordance with the provisions of GATS , particularly those relating to the participation of developing countries in global services trade, after, where applicable, the ESA member states have acquired sufficient experience in applying MFN Treatment under the GATS and develop sufficient capacity in the services sector

5. The Community shall support the ESA member states’ efforts to strengthen their capacity in the supply of services, with a view to enhancing their competitiveness and thereby increasing the value and the volume of their trade in services

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Article 2

Objectives

Consistent with the provisions under the WTO Agreement, the objectives of this Part are to:

1. Promote economic growth and development in the ESA States through trade in services, with a view to enhancing attainment of millennium development goals as well as their smooth and gradual integration into the world economy.

2. Enhance trade in services among ESA States in the context of regional integration

3. Eliminate restrictions to trade in services on the part of the EU in service sectors of priority to the ESA States with a view to enabling those States to play a full part in international trade in services regionally and globally.

4. Establish and strengthen regulatory frameworks and enforcement mechanisms.

5. Progressively liberalise the ESA States’ service sectors in accordance with their respective levels of development based on positive list approach, whilst respecting the economic needs of individual ESA States.

6. Support and strengthen ESA States’ supply capacity in priority service sectors with a view to enhancing their competitiveness and increasing their trade especially in trade in services.

Article 3

Principles

1. The fundamental principles that govern the achievement of the objectives shall include:

(a) Appropriate sequencing between:

(i) support for development with a view to strengthening of the service sectors of the ESA States,

(ii) the negotiation of liberalisation commitments,

(iii) the development of a regional framework on trade in services, and

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(iv) entering into progressive liberalisation with the EU;

(b) the respective commitments of Parties under the General Agreement on Trade in Services (GATS) and Articles 41-43 of Cotonou Partnership Agreement (CPA) and the WTO Modalities for the Special Treatment of LDCs;

(c) progressive liberalisation using the “positive list approach,” as adapted to the level of development of the individual ESA countries both in overall terms and in terms of their specific sectors and sub-sectors and their specific constraints;

(d) The need for a sound regulatory framework, while being cognisant of each parties’ right to regulate and introduce new regulations on the supply of services which meet national policy objectives; and

(e) The need to take particular account of the serious difficulty of the least-developed countries and take due account of the vulnerability of landlocked and small island developing countries arising from their special economic situation and their development, trade and financial needs.

2. Progressive liberalisation is underpinned on the principles of;

(a) Special and differential treatment of ESA states by the EU;

(b) Asymmetry;

(c) regional preferences

(d) Variable geometry to address differences in the level of services sectors development in ESA region;

(e) Special safeguards mechanisms; and

(f) Co-operation between the ESA and EU in areas of mutual interest

3) In accordance with Article 41.4 of the CPA, ESA shall not be obliged to liberalise trade in services until after they have acquired some experience in applying the most favoured nation treatment under GATS as members of the WTO.


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Article III

Scope and Coverage

1. For the purposes of this Agreement, services are those as listed in WTO 120.

2. Except where defined otherwise, trade in services is defined in line with Article 1 of GATS and include supply of services through the following modes:

(a) cross-border trade; supply of a service from the territory of a Party into the territory of the other Party (mode 1)

(b) Consumption abroad; supply of a service in the territory of a Party to the service consumer of the other Party (mode 2)

(c) Commercial presence; supply of a service by a service supplier of a Party through commercial presence a in the territory of the other Party (mode 3).

(d) Presence of natural persons; supply of a service through the presence of natural persons of a Party to the territory of the other party (mode 4). However, Mode 4 shall also include the presence of natural persons of ESA States where such persons can supply services on a temporary basis to juridical persons of EU origin.

3. Nothing in this Title shall be construed to impose any obligation with respect to government procurement or investment protection.

4. The provisions of this Title shall not apply to subsidies granted by the Parties

5. This Title shall not apply to:

(a) Activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary policies;

(b) Activities forming part of a statutory system of social security or public retirement plans; and

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(c) On the part of ESA, where "a service is supplied in the exercise of governmental authority", means any service which may or may not be supplied on a commercial basis or in competition with one or more service suppliers.

(d) On the Part of EC, "a service supplied in the exercise of governmental authority", means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.

Article IV

Definitions

1. For the purposes of this Agreement:

(a) ‘measure’ means any measure by a Party, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form;

(b) ‘measures adopted or maintained by a Party’ means measures taken by:

(i) central, regional or local governments and authorities;

(ii) non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities; and

(iii) in respect of;

(a) The purchase, payment or use of a service;

(b) The access to and use of, in connection with the supply of a service, services which are required by those Parties to be offered to the public generally

(c) the presence, including commercial presence, of persons of a Party for the supply of a service in the territory of another Party

(d) The presence, including commercial presence of juridical or natural persons of a party for the supply of a service in the territory of another party.

(2). “National” means a natural person who is a national of one of the Parties in accordance with their respective legislations.

(3) “Natural person of another Party” means a natural person who resides in the territory of the other Party or any other Third Party, and who under the law of that other Party;

(a) is a national of that other Party; or(b) Has the right of permanent residence in that other Party.


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(4) “Person” means either natural person or a juridical person;

(5) “juridical person” means any legal entity duly constituted or otherwise organised under applicable laws of any Party, whether for profit or otherwise, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, joint venture, sole proprietorship or association.

(b) “Juridical person of another Party” means a juridical person who is either;

(1) Constituted or otherwise organised under the law of that other Party, and is engaged in substantive business operations in the territory of that Party or any other Party;

(2) Or in the case of the supply of a service through commercial presence, owned or controlled by;

(i) Natural persons of that Party; or

(ii) Juridical persons of that other Party (ESA Definition)

(d) a ‘Community juridical person’ or an ESA Signatory State juridical person’ means a juridical person set up in accordance with the laws of a Member State of the Community or of an ESA Signatory State respectively, and having its registered office, central administration, or principal place of business in the territory of the Community or of an ESA Signatory State, respectively;

Should the juridical person have only its registered office or central administration in the territory of the Community or of the ESA Signatory States respectively, it shall not be considered as a Community or a ESA Signatory State juridical person respectively, unless its operations possess a real and continuous link with the economy of the Community or of an ESA Signatory State, respectively; (EC Definition)

(6) As regards juridical persons, the right to take up, acquire and pursue the economic activities covered by this Agreement, including by means of the setting up and management of subsidiaries, branches or any other form of secondary establishment.

(7) Notwithstanding the preceding paragraph, shipping companies established outside the Community or the ESA Signatory States and controlled by nationals of a Member State of the Community or of an ESA Signatory State, respectively, shall also be beneficiaries of the provisions of this Agreement, if

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their vessels are registered in accordance with their respective legislation, in that Member State or in an ESA Signatory State and carry the flag of a Member State or of an ESA Signatory S [EPA REGION] State.

(8) an "economic integration agreement" shall mean an agreement substantially liberalising trade and establishment pursuant to WTO rules

(9) “Direct taxes” comprises all taxes on total income, on total capital or elements of income or of capital, including taxes on gains from the alienation of property, taxes on estates, inheritances and gifts, and taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.

(10). ‘Positive list’ approach” means Parties undertake national treatment and market access commitments by specifying the type of access or treatment offered to the other Party in scheduled sectors in Article 7. Under this approach a Party;

(a) Can decide whether or not to enter any sector in its schedule, and only entries made reflect the extent and level of commitments.

(b) Even where a sector is included in the schedule, the Party can decide on the extent of liberalisation to commit in that sector in each of the four modes described in Article 2.

(11). “Service consumer” means any legal or natural person that receives or uses a service.

(12). “Sector” of a service means,

(a) With reference to a specific commitment, one or more, or all sub-sectors of that service as described in the Central Product Classification (CPC), as specified in a Parties Schedule

(b) Otherwise the whole of that service sector as described in the CPC, including all of its sub-sectors.

(13). “Service of another Party” means a service which is supplied,

(a) from or in the territory of that other Party, or in the case of maritime transport, by a vessel registered under the laws of that other Party, or by a person of that other Party which supplies the service through the operation of a vessel and /or its use in whole or in part; or

(b) In case of the supply of a service through commercial presence or through presence of natural persons, by a service supplier of that other Party.


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(14). “Supply of a service” includes the production, distribution, marketing, sale and delivery of a service.

(15) [“Enhanced mode 4” includes presence of natural persons of ESA States where such persons supply services to entities/legal persons in the EU.]

For purposes of this Chapter

(a) ‘Commercial Presence’ means any type of business or professional establishment through:

(i) the constitution, acquisition or maintenance of a juridical person3, or

(ii) the creation or maintenance of a branch or representative office

within the territory of a Party for the purpose of performing an economic activity;

(b) ‘investor’ of a Party means any natural or juridical person that seeks to perform or performs an economic activity through setting up an establishment;

(c) ‘economic activity’ does not include activities carried out in the exercise of governmental authority, i.e. activities carried out neither on a commercial basis nor in competition with one or more economic operators.

(d) ‘subsidiary’ of a juridical person of a Party means a juridical person which is effectively controlled by another juridical person of that Party4;

(e) ‘branch’ of a juridical person means a place of business not having legal personality which has the appearance of permanency, such as the extension of a parent body, has a management and is materially equipped to negotiate business with third parties so that the latter, although knowing that there will if necessary be a legal link with the parent body, the head office of which is abroad, do not have to deal directly with such parent body but may transact business at the place of business constituting the extension

For the purpose of this Chapter

3 The terms "constitution" and "acquisition" of a juridical person shall be understood as including capital participation in a juridical person with a view to establishing or maintaining lasting economic links.

4 A juridical person is controlled by another juridical person if the latter has the power to name a majority of its directors or otherwise to legally direct its actions.

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(a) cross-border supply of services is defined as the supply of a service:

(i) from the territory of a Party into the territory of the other Party

(ii) in the territory of a Party to the service consumer of the other Party

(b) ‘services’ includes any service in any sector except services supplied in the exercise of governmental authority.

‘a service supplied in the exercise of governmental authority’ means any service which is supplied neither on a commercial basis, nor in competition with one or more service suppliers.

(c) ‘service supplier’ of a Party means any natural or juridical person of a Party that seeks to supply or supplies a service

TITLE II

GENERAL PROVISIONS AND DISCIPLINES]

Article V

Most Favoured Nation Treatment

1.

(a) The EC and its member States shall accord to services and services suppliers of the ESA States, treatment no less favourable than that it accords to the like services and services suppliers of any third country with whom they conclude an economic integration agreement in the future.

Most-favoured-nation treatment (Establishment – EC Prop)

1. With respect to any measures affecting cross border supply of services and commercial presence covered by this Chapter

(a) the Community and its Member States shall accord to establishments and investors of theESA Signatory States a treatment no less favourable than that they may accord to like establishments and investors of any third country with whom they conclude an economic integration agreement in the future;

(b) the ESA Signatory States shall accord to Community’s establishments and investors a treatment no less favourable than that they may accord to like establishments and investors of any


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Community competitor with whom they conclude an economic integration agreement in the future

2. Treatment granted to establishments and investors of a third country by either Party arising from a regional economic integration agreement requiring the Parties thereto to approximate their legislation shall be excluded from the obligation of this provision. Treatment granted under measures benefiting from the coverage of an MFN exemption listed in accordance with Article II.2 of the General Agreement on Trade in Services, treatment granted under measures providing for recognition of qualifications, licences or prudential measures in accordance with Article VII of the General Agreement on Trade in services or its Annex on Financial Services and treatment granted under any international agreement or arrangement relating wholly or mainly to taxation shall also be excluded from this provision.

MFN Exemptions

To be developed

Article VI

Transparency and disclosure of confidential information

1. The EC shall publish promptly and , at the latest by the time of their entry into force, except in emergency situations, subsequent to their entry into all relevant measures of general application which pertain to or affect the operation of this Agreement. International agreements pertaining to or affecting trade in services to which a Party is a signatory shall also be published.

2. ESA States shall endeavour to publish, subsequent to their entry into force, all relevant measures of general application which affect the operation of t is agreement. Provided that such publication shall be undertaken subject to the capacity of an ESA State.]

3. Where publication as referred to in paragraph 1 is not practicable, such information shall be made otherwise publicly available.

4. Each Party shall respond promptly to all requests by the other Party for specific information on any of its measures of general application or international agreements within the meaning of paragraph 1. Each Party shall also designate

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or establish one or more enquiry points to provide specific information to other Party, upon request, on all such matters. The enquiry points shall answer all reasonable inquiries from the other Party and provide relevant information on matters covered by this Chapter. . Such enquiry points are listed in Annex [ ] (Enquiry points). Enquiry points need not be depositories of laws and regulations.

5. Nothing in this Agreement shall require any Party to provide confidential information, the disclosure of which would impede law enforcement, or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests of particular enterprises, public or private.

Article VII

Domestic Regulation

1. The Parties recognise the necessity to establish sound regulatory frameworks while retaining the right to regulate and introduce new regulations that meet other national policy objectives provided these measures are not disguised restrictions to trade.

2. In sectors where specific commitments are undertaken, each Party shall ensure that all measures of general application affecting trade in services are administered in a reasonable, objective, consistent and impartial manner.

3. Where authorisation is required for the supply of a service on which a specific commitment has been made, the competent authorities of a Party shall, within a reasonable but not later than six months period of time after the submission of an application considered complete under domestic laws and regulations, inform the applicant of the decision concerning the application. At the request of the applicant, the competent authorities of the Party shall provide, without undue delay, information concerning the status of the application and in accordance with the respective national laws

4. Each Party shall maintain or institute as soon as practicable judicial, arbitral or administrative tribunals or procedures which provide, at the request of an affected service supplier of the other Party, for the prompt review of, and where justified, appropriate remedies for, administrative decisions affecting trade in services. Where such procedures are not independent of the agency entrusted with the administrative decision concerned, the Party shall ensure that the procedures in fact provide for an objective and impartial review.

5.The provisions of paragraph 4 shall not be construed to require a Party to institute such tribunals or procedures where this would be inconsistent with its constitutional structure or the nature of its legal system, or where the existing judicial or legal systems has jurisdiction and capacity to address such remedies.


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6. With the objective of ensuring that domestic regulation, including measures relating to qualification requirements and procedures, technical standards and licensing requirements, do not constitute unnecessary barriers to trade in services, the Parties pursuant to the negotiations on disciplines on these measures, under Article VI.4 of the GATS, agree to the disciplines attached here to in Annex….. The Parties note that such disciplines aim at ensuring that such requirements are inter alia:

(a) Based on objective and transparent criteria, such as competence and the ability to supply the service;

(b) Not more burdensome than necessary to ensure the quality of the service;

(c) In the case of licensing procedures, not in themselves a restriction on the supply of the service.

7. Pending the incorporation of disciplines pursuant to paragraph ….., for sectors where a Party has undertaken specific commitments and subject to any terms, limitations, conditions or qualifications set out therein, a Party shall not apply licensing and qualification requirements and technical standards that nullify or impair such specific commitments in a manner which:

(a) Does not comply with the criteria outlined in paragraphs 6(a), 6(b) or 6(c); and

(b) Could not reasonably have been expected of that Party at the time the specific commitments in those sectors were made.

8 In determining whether a Party is in conformity with the obligation under paragraph 6, account shall be taken of international standards of relevant international organizations whose membership is open to the parties 5 applied by that Party.

9. The co-operation in the area of domestic regulation shall focus on financial and technical support to;

(a) Put in place and /or reform existing services regulatory frameworks and institutions;

(b) Establish and restructure national bodies responsible for the development of national standards in services;

5 The term "relevant international organisations" refers to international bodies whose membership is open to the relevant bodies of both Parties.

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(c) Facilitate participation of ESA states in activities of international standard setting bodies in services; and

(d) Enhance transparency of regulations, as stipulated in Article ……..

e) Enhance the capacity of ESA service suppliers to memet the technical standards and requirements in European markets

Article VIII

Mutual Recognition

1. Nothing in this Title shall prevent a Party from requiring that natural persons must possess the necessary qualifications and/or professional experience specified in the territory where the service is supplied, for the sector of activity concerned.

2. For the purposes of the fulfilment of its standards or criteria for the

authorisation, licensing or certification of services suppliers, a Party

shall aim to recognise the education or experience obtained,

requirements met, or licenses or certifications granted or recognised in

the other Party. . A party shall publish the criteria for recognition.

3. In accordance with their prior agreement, the Parties shall ensure that their respective professional bodies in the service sectors of mutual interests conclude, within a reasonable period to be mutually agreed upon, any such agreements or arrangements providing for mutual recognition of the education or experience obtained, requirements met, or licenses or certifications in those service sectors, the details of such agreements or arrangements, including the exact extent and scope of recognition. Progress in this regard will be continually reviewed by the Parties in the course of the review of this Agreement pursuant to Article ----------.

4. After the entry into force of this Agreement, upon a request being made in writing by a Party to the other Party in any regulated service sector not covered in paragraph 2, the requested Party shall encourage its relevant professional, standard-setting or self- regulatory body in that service sector to enter into negotiations, within a reasonable period of time from the date of the request being received in writing, to negotiate agreements or arrangements providing for mutual recognition of education, or experience obtained, requirements met, or licenses or certifications granted in that Service Sector, with a view to the achievement of early outcomes. Progress in this regard will be continually reviewed by the Parties in the course of the review of this Agreement pursuant to Article --------------.


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5) Where a Party recognises, by agreement or arrangement, the education or experience obtained, requirements met or licenses or certifications granted in the territory of a country that is not a Party to this Agreement, that Party shall accord the other Party, upon request, adequate opportunity to negotiate, through its professional standard setting bodies, its accession to such an agreement or arrangement or to negotiate comparable ones with it. Where a Party accords recognition autonomously, it shall afford adequate opportunity for the other Party to demonstrate that the education or experience obtained, requirements met or licenses or certifications granted in the territory of that other Party should also be recognised.

6. The Parties agree that they shall not be responsible in any way for the settlement of disputes arising out of or under the agreements or arrangements for mutual recognition concluded by their respective professional, standard-setting or self-regulatory bodies under the provisions of this Article and that the provisions of Chapter -- (Dispute Settlement) shall not apply to disputes arising out of, or under, the provisions of such agreements or arrangements. Unless they contravene the obligations undertaken in this agreement (e.g. a body setting criteria that do constitute barriers to market access, i.e. unreasonable language, experience requirements, etc)

7. In sectors where specific commitments regarding professional services are undertaken, each Party shall provide for and publish adequate procedures to verify the competence of professionals of the other.

EC Proposal

Mutual recognition

2. The Parties shall encourage the relevant professional bodies in their respective territories to provide recommendations on mutual recognition to the [Joint Committee], for the purpose of the fulfilment, in whole or in part, by investors and service suppliers of the criteria applied by each Party for the authorisation, licensing, operation and certification of investors and service suppliers and, in particular, professional services.

3. On receipt of a recommendation referred to in the preceding paragraph, the [Joint Committee] shall, within a reasonable time, review the recommendation with a view to determine whether it is consistent with this Agreement.

4. When, in conformity with the procedure set in paragraph 2, a recommendation referred to in paragraph 1 has been found to be consistent with this Agreement and there is a sufficient level of correspondence between the relevant regulations of the Parties, the Parties shall, with a view to implement that recommendation, negotiate,

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though their competent authorities, an agreement on mutual recognition of requirements, qualifications, licences and other regulations.

5. Any such agreement shall be in conformity with the relevant provisions of the WTO Agreement and, in particular, Article VII of GATS.

Article IX

Anti-competitive Business Practices

1. The Parties recognise that certain business practices of service suppliers, other than those falling under Article...( Mutual Recognition), may restrain competition and thereby restrict trade in services

2. The Parties may request another Party to provide information necessary for eliminating practices referred to in paragraph 1. A Party requested to provide information shall respond through the supply of publicly available non-confidential information of relevance to the matter in question. The Party requested shall also provide the information subject to its domestic law and to the conclusion of a satisfactory agreement concerning the safeguarding of its confidentiality by the requesting Party.

Article X

Payments and Transfers

1. Except under the circumstances envisaged in Article XI, a Member shall not apply restrictions on international transfers and payments for current transactions relating to its specific commitments.

2. Nothing in this Agreement shall affect the rights and obligations of the members of the International Monetary Fund under the Articles of Agreement of the Fund, including the use of exchange actions which are in conformity with the Articles of Agreement, provided that a Member shall not impose restrictions on any capital transactions inconsistently with its specific commitments regarding such transactions, except under Article XI or at the request of the Fund.

Article XI

Restrictions to Safeguard the Balance of Payments

1. In the event of serious balance-of-payments and external financial difficulties or threat thereof, an ESA state may adopt or maintain restrictions on


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trade in services on which it has undertaken specific commitments, including on payments or transfers for transactions related to such commitments. It is recognized that particular pressures on the balance of payments of an ESA state in the process of economic development or economic transition may necessitate the use of restrictions to ensure, inter alia, the maintenance of a level of financial reserves adequate for the implementation of its programme of economic development or economic transition.

2. The restrictions referred to in paragraph 1:

(a) Shall not discriminate among ESA states;

(b) Shall be consistent with the Articles of Agreement of the International Monetary Fund;

(c) Shall avoid unnecessary damage to the commercial, economic and financial interests of any other ESA state;

(d) Shall not exceed those necessary to deal with the circumstances described in paragraph 1;

(e) Shall be temporary and be phased out progressively as the situation specified in paragraph 1 improves.

3. in determining the incidence of such restrictions, ESA states may give priority to the supply of services which are more essential to their economic or development programmes. However, such restrictions shall not be adopted or maintained for the purpose of protecting a particular service sector.

4. Any restrictions adopted or maintained under paragraph 1, or any changes therein, shall be promptly notified to the……….. Council.

5. (a) ESA States applying the provisions of this Article shall consult promptly with the [Committee on Balance-of-Payments Restrictions on restrictions adopted under this Article.]

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(b) The…………………. shall establish procedures6 for periodic consultations with the objective of enabling such recommendations to be made to the ESA State concerned as it may deem appropriate.

(c) Such consultations shall assess the balance-of-payment situation of the ESA State Member concerned and the restrictions adopted or maintained under this Article, taking into account, inter alia, such factors as:

(i) the nature and extent of the balance-of-payments and the external financial difficulties;

(ii) the external economic and trading environment of the consulting ESA State;

(iii) alternative corrective measures which may be available.

(d) The consultations shall address the compliance of any restrictions with paragraph 2, in particular the progressive phase out of restrictions in accordance with paragraph 2(e).

(e) In such consultations, all findings of statistical and other facts presented by the International Monetary Fund relating to foreign exchange, monetary reserves and balance of payments, shall be accepted and conclusions shall be based on the assessment by the Fund of the balance-of-payments and the external financial situation of the consulting ESA State .

6. If an ESA State Member which is not a member of the International Monetary Fund wishes to apply the provisions of this Article, the ……………………… shall establish a review procedure and any other procedures necessary

Article XII

Credit for autonomous liberalization

6 It is understood that the procedures under paragraph 5 shall be the same as the GATT 1994 procedures.


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Elements to be considered:

- member states to be provided with additional market access/ technical assistance/ capacity building and additional financial resources as a motivation to help them develop their services sector)

Article XIII

Safeguard Measures

[Emergency Safeguard measure ]

Article XIV

General Exceptions

1. Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail, or a disguised restriction on trade in services, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any Party of measures:

(a) necessary to protect public morals or to maintain public order;7

(b) necessary to protect human, animal or plant life or health;

(c) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement including those relating to:

(i) the prevention of deceptive and fraudulent practices or to deal with the effects of a default on services contracts;

(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts;

(iii) safety;

(d) inconsistent with Article ……., provided that the difference in treatment is aimed at ensuring the equitable or effective8 imposition

7 The public order exception may be invoked only where a genuine and sufficiently serious threat is posed to one of the fundamental interests of society.

8 Measures that are aimed at ensuring the equitable or effective imposition or collection of direct taxes include measures taken by a Member under its taxation system which:

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or collection of direct taxes in respect of services or service suppliers of other Members;

(e) inconsistent with Article……, provided that the difference in treatment is the result of an agreement on the avoidance of double taxation or provisions on the avoidance of double taxation in any other international agreement or arrangement by which the Member is bound.]

Article XV

Security Exceptions

1. Nothing in this Agreement shall be construed:

(a) to require any Party to furnish any information, the disclosure of which it considers contrary to its essential security interests; or

(b) to prevent any Party from taking any action which it considers necessary for the protection of its essential security interests:

(i) relating to the supply of services as carried out directly or indirectly for the purpose of provisioning a military establishment;

(i) apply to non-resident service suppliers in recognition of the fact that the tax obligation of non-residents is determined with respect to taxable items sourced or located in the Member's territory; or

(ii) apply to non-residents in order to ensure the imposition or collection of taxes in the Member's territory; or

(iii) apply to non-residents or residents in order to prevent the avoidance or evasion of taxes, including compliance measures; or

(iv) apply to consumers of services supplied in or from the territory of another Member in order to ensure the imposition or collection of taxes on such consumers derived from sources in the Member's territory; or

(v) distinguish service suppliers subject to tax on worldwide taxable items from other service suppliers, in recognition of the difference in the nature of the tax base between them; or

(vi) determine, allocate or apportion income, profit, gain, loss, deduction or credit of resident persons or branches, or between related persons or branches of the same person, in order to safeguard the Member's tax base.

Tax terms or concepts in paragraph (d) of Article XIV and in this footnote are determined according to tax definitions and concepts, or equivalent or similar definitions and concepts, under the domestic law of the Member taking the measure.


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(ii) relating to fissionable and fusionable materials or the materials from which they are derived;

(iii) taken in time of war or other emergency in international relations; or

(c) to prevent any Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

2. The ……………………….. shall be informed to the fullest extent possible of measures taken under paragraphs 1(b) and (c) and of their termination.]

[TITLE III

SPECIFIC COMMITMENTS

Article XVI

Market Access

1. With respect to market access through the modes of supply identified in Article ……, the Parties shall accord services and service suppliers of each Party treatment no less favourable than that provided for under the terms, limitations and conditions agreed and specified in their Schedules.

2. In those sectors and modes of supply where commitments have been undertaken, pursuant to Article XVIII and contained in Annex... no Party shall adopt or maintain:

(a) limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;

(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;

(c) limitations on the total number of services operations or on the total quantity of service output expressed in the terms of designated numerical units in the form of quotas or the requirement of an economic needs test;

(d) limitations on the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of

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a specific service in the form of numerical quotas or a requirement of an economic needs test;

(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier of any other Party may supply a service; and

(f) limitations on the participation of foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of individual or aggregate foreign investment.

Article XVII

National Treatment

1. In the Sectors where market access commitments are inscribed in Annex..., subject to any conditions, qualifications and reservations specified therein, each party shall, in accordance with Article ………., grant to services and service suppliers of another Party, in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers.

Alternative paragraph 1. In the sectors inscribed in its Schedule and subject to any conditions and qualifications set out therein, each Party shall accord to services and services suppliers of any other Party, in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers.

2. A Party may meet the requirement of paragraph 1 by according to services and service suppliers of another Party, either formally identical treatment or formally different treatment to that it accords to its own like services and service suppliers.

3. Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of competition in favour of services and service suppliers of a Party compared to like services and service suppliers of another Party.

4. Specific commitments undertaken by ESA states under this Article shall not be construed to require any party to compensate for inherent competitive disadvantages which result from the foreign character of the relevant services or services suppliers.

Article XVIII

Progressive Liberalisation

1. In pursuance of the objectives of this Agreement, Parties shall enter into successive rounds of negotiations, [[beginning not later than ……………years from the date of entry into force of this agreement and periodically]]


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thereafter, with a view to achieving a progressively higher level of liberalization. Such negotiations shall be directed to the reduction or elimination of the adverse effects on trade in services of measures as a means of providing effective market access. This process shall take place with a view to promoting the interests of all participants on a mutually advantageous basis and to securing an overall balance of rights and obligations.

[Alternative para 1 :

2. No later than 3 years after entry into force of this agreement the EC and each signatory ESA state will complete negotiations on services liberalization, on the basis of the following:

- liberalization schedule for one service sector for each participating signatory ESA state

agreement to negotiate progressive liberalization with substantial sectoral coverage within a period of 5 years following the conclusion of the full EPA

3. Notwithstanding the above provision, an ESA signatory state in a position to do so may conclude negotiations of its liberalization schedule in a shorter period ]

4. The process of liberalization shall take place with due respect for national policy objectives and the level of development of individual Parties , both overall and in individual sectors. There shall be appropriate flexibility for ESA countries opening fewer sectors, liberalizing fewer types of transactions, progressively extending market access in line with their development situation and, when making access to their markets available to EC service suppliers, attaching to such access conditions aimed at achieving the objectives referred to in Article ……….

Article XIX

Variable Geometry

1. Notwithstanding any provision of this Chapter, the EU and an individual ESA states in a position to do so may provide to each other’s services and service suppliers preferential treatment

Article XX

Schedules of commitments

5. The sectors liberalised by each of the Parties pursuant to this chapter and, by means of reservations, the market access and national treatment

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limitations applicable to services and service suppliers of the other Party in those sectors are set out in lists of commitments included in Annex…..

6. With respect to sectors where commitments are undertaken, each Schedule specifies: (a) terms, limitations and conditions on market access;(b) conditions and qualifications on national treatment;(c) undertakings relating to additional commitments;(d) where appropriate the time-frame for implementation of such

commitments; and

(e) the date of entry into force of such commitments

7. The Schedules of specific commitments are annexed to this Agreement and form an integral part thereof.

Article XXI

Modification of Schedules

1) A Party may modify or withdraw any commitment in its Schedule, at any time after 3 years have elapsed from the date on which that commitment entered into force, in accordance with the provisions of this Article. It shall notify the other Party of its intent to so modify or withdraw a commitment no later than one month before the intended date of implementation of the modification or withdrawal.

2) At the request of the other Party, the modifying Party shall enter into negotiations with a view to reaching agreement on any necessary compensatory adjustment. In such negotiations and agreement, the Party shall endeavour to maintain a general level of mutually advantageous commitments not less favourable to trade than that provided for in Schedules of specific commitments prior to such negotiations. The Parties shall endeavour to conclude negotiations on such compensatory adjustment to mutual satisfaction within …….. months, failing which recourse may be had to the provisions of Chapter ----------- of this Agreement. Provided that ESA states shall not be required to provide compensation to the EU or service providers of the EU.

Article XXII

Regional Integration


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1. With respect to any measure affecting the supply of services, in the context of the regional integration, an ESA Signatory State may accord to service suppliers of other ESA Signatory States treatment more favourable than that accorded to like services suppliers of the Community or its Member States on the basis of this Agreements and to services suppliers of any other Signatory ESA State on the basis of an economic integration agreement

2. By derogation to the Most Favoured Nation provisions in this Chapter, economic integration agreements concluded between ESA Signatory States may extend to establishments, investors, services and services suppliers of the Parties thereto treatment more favourable than that accorded byESA Signatory States to services suppliers of the Community or its Member States.

3. Notwithstanding the commitments undertaken pursuant to this Chapter by an ESA Signatory States vis-à-vis the Community and its Member States, the principles set in Chapter … of this Title to support the progressive liberalisation of trade in services between the Parties shall guide the liberalisation of trade in services between ESA Signatory States in the context of their regional integration.

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[TITLE IV

REGULATORY FRAMEWORK, DEVELOPMENT COOPERATION AND CAPACITY BUILDING]9

Article XXIII…………………

Linkage to ESA EPA Development Chapter

Article XXIV

Tourism and Travel Related Services

Scope

For the purpose of this Title, Tourism and Travel Related Services means;

(a) hotels and restaurants (including catering);

(b) travel agencies and tour operator services;

(c) tour guide services; and

(d) other services.

(e) computer reservation services

(f) global distribution services

Objectives

2. The main purpose shall be among others regional tourism development, policy framework development and harmonisation, regional co-operation in tourism, transboundary natural resource management, tourism statistics and tourism satellite accounts, tourism finance, investment, research and trade in tourism services.

3. The Parties shall strengthen the development of efficient trade in tourism services in a sustainable manner through reduction of the tourism supply constraints which limit the ability of ESA suppliers to be internationally competitive.

Prevention of anticompetitive practices

In accordance with the provisions of Chapter 1 of Title IV, appropriate measures shall be maintained or introduced for the purpose of preventing suppliers, in particular in the context of tourism distribution networks10, to affect materially the 9 There needs to be text for all the ten main services sectors and not just those indicated here.

10 For the purpose of this section, tourism distribution networks means tour operators and other tourism wholesalers (both out-bound and in-bound), computer reservation systems and global distribution systems (whether or not connected to airlines or provided through the internet), travel agencies and


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terms of participation in the relevant market for tourism services by engaging in or continuing anti-competitive practices, including, inter alia, abuse of dominant position through imposition of unfair prices, exclusivity clauses, refusal to deal, tied sales, quantity restrictions or vertical integration.

Access to technology

The EC Party and the Signatory ESA States shall endeavour to facilitate the transfer of technology on a commercial basis to establishments in the Signatory ESA States.

Small and medium-sized enterprises

The EC Party and the Signatory ESA States shall endeavour to facilitate the participation of small and medium-sized enterprises in the tourism services sector.

Mutual Recognition

The EC Party and the Signatory ESA States shall cooperate towards the mutual recognition of requirements, qualifications, licenses or other regulations in accordance with Article 22 of this Agreement.

Increasing the Impact of Tourism on Sustainable Development

The The EC Party and the Signatory ESA States shall encourage the participation of ESA services suppliers in international, regional, bilateral and private financing programs to support the sustainable development of tourism.

Environmental and quality standards

The EC Party and the Signatory ESA States shall encourage compliance with environmental and quality standards applicable to tourism services in a reasonable and objective manner, without constituting unnecessary barriers to trade, and shall endeavour to facilitate the participation of the Signatory ESA States in relevant international organizations setting environmental and quality standards applicable to tourism services.

Exchange of information and consultation

1. The EC Party and the Signatory ESA States agree to exchange experiences, information and best practices and to consult on issues covered by this section and relevant to trade between the Parties. The Joint Committee shall develop modalities for this regular dialogue on the issues covered by this section.

other distributors of tourism services.

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2. The EC Party and the Signatory ESA States shall invite private and other relevant stakeholders to this dialogue, where relevant and agreed by them.

3. The EC Party and the Signatory ESA States agree further that regular dialogue would be useful on the issuance of travel advisories.

Development cooperation and technical assistance

Subject to the provisions of Article.. [Article 36 of Interim Agreement], the Parties agree to cooperate, with a view to enhance the competitiveness, capacity and efficiency of ESA services and services suppliers. The EC Party and the Signatory ESA States shall cooperate for the advancement of the tourism sector in the Signatory ESA States, given the inherent asymmetries in respective levels of development of the Parties.

The EC Party and the Signatory ESA States agree to cooperate, including by facilitating support in the following areas:

(i) Capacity building for environmental management in tourism areas at the Regional and local level;

(ii) The development of Internet marketing strategies for small and medium-sized tourism enterprises in the tourism services sector;

(iii) Mechanisms to ensure the effective participation of Signatory ESA States in international standard setting bodies focused on sustainable tourism standards development; programmes to achieve and ensure equivalency between national/regional and international standards for sustainable tourism; and for programmes aimed at increasing the level of compliance with sustainable tourism standards by regional tourism suppliers;

(iv) Tourism exchange programs and training, including language training, for tourism services providers.

(v) Support in the provision of resources and knowledge to direct tourism development;

(vi) Support in packaging, promotion and marketing of tourism within ESA, with Europe and the rest of the world;

(vii) Support in establishing financing pools and mechanisms for tourism promotion and development;

(viii) Support in national and regional as well as multi-sector co-ordination of tourism promotion and development issues;

(ix) Support in developing and/or strengthening trans-boundary natural resource management across borders in the ESA;

(x) Promotion and encouragement of continuous research and development in tourism including the development and collection of tourism services statistics;

(xi) Support in the development of joint ESA programmes in tourism promotion;

(xii) Support in deepening ESA integration in tourism services;


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(xiii) Development assistance focused on modernising existing regulatory frame work, developing an enabling environment for investment in the sector, strengthening institutional capacities in the sector, improving standards and promoting competition, addressing environmental concerns, among others;

(xiv) Encouragement and fostering of sustainable best practices and quality standards;

(xv) Building synergies with other Regional Economic Communities; and

(xvi) Support in the development of national and regional tourism development agencies.

(xvii) support for the establishment of community-based and diversified tourism

(xviii) support for the establishment of tourism-related infrastructure (xix) support for tourism specific human resource development(xx) support for addressing leakages; (xxi) support in addressing anti-competitive practices of service

suppliers such as tour operators

Article XXV

Financial Services

Scope and definitions

1. For the purposes of this Title, Financial Services means;

(a) Banking and other related services (excluding insurance)

(i) acceptance of deposits and other repayable funds from the public;

(ii) lending of all types, including, inter alia, consumer credit, mortgage credit, factoring and financing of commercial transactions;

(iii) financial leasing;

(iv) all payment and money transmission services, including credit, charge and debit cards, travellers cheques and bankers drafts;

(v) guarantees and commitments;

(vi) trading for own account or for account of customers, whether on an exchange, in an over-the-counter market or otherwise, the following:

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(1) money market instruments, including cheques, bills, certificates of deposits;

(2) foreign exchange;

(3) derivative products including, but not limited to, futures and options;

(4) exchange rate and interest rate instruments, including products such as swaps, forward rate agreements;

(5) transferable securities;

(6) other negotiable instruments and financial assets, including bullion.

(7) participation in issues of all kinds of securities, including underwriting and placement as agent (whether publicly or privately) and provision of services related to such issues;

(vii) money broking;

(viii) asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial, depository and trust services;

(ix) settlement and clearing services for financial assets, including securities, derivative products, and other negotiable instruments;

(x) advisory, intermediation and other auxiliary financial services on all the activities including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy; and

(xi) provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services;

(b) Insurance and Insurance related services,

(i) life, accident and health insurance services:

(ii) non-life insurance services

(iii) reinsurance and retrocession; and

(iv) services auxiliary to insurance (including broking and agency services)

(c) Securities


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(i) trading in securities at the stock exchange and clearing and settlements

(ii) underwriting

(iii) brokerage

(iv) asset investment and pension management services

(v) portfolio management including the marketing and promotion of financial products and advisory

(vi) other services auxiliary to all securities services.

Objectives

2. To further develop the financial services sector at the regional level, in particular, the tackling of supply-side constraints, regulatory framework, competitiveness issues and policy reforms, including to ensure the integrity and stabiliity of the financial system

Co-operation

Prudential carve-out

1. The EC Party and ESA Signatory States may adopt or maintain measures for prudential reasons, such as:

(a) the protection of investors, depositors, policy-holders or persons to whom a fiduciary duty is owed by a financial service supplier;

(b) ensuring the integrity and stability of a Party's financial system.

2. These measures shall not be more burdensome than necessary to achieve their aim, and shall not discriminate against financial service suppliers of the other Party in comparison to its own like financial service suppliers.

3. Nothing in this Agreement shall be construed to require the EC Party and ESA Signatory States to disclose information relating to the affairs and accounts of individual consumers or any confidential or proprietary information in the possession of public entities.

Effective and transparent regulation

1. The EC Party and ESA Signatory States shall make its best endeavours to provide in advance to all interested persons any measure of general application that the Party proposes to adopt in order to allow an

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opportunity for such persons to comment on the measure. Such measure shall be provided:

(a) by means of an official publication; or

(b) in other written or electronic form.

2. The EC Party and ESA Signatory States shall make available to interested persons its requirements for completing applications relating to the supply of financial services.

On the request of an applicant, the concerned Party shall inform the applicant of the status of its application. If the concerned Party requires additional information from the applicant, it shall notify the applicant without undue delay.

3. The EC Party and ESA Signatory States shall make its best endeavours to ensure that internationally agreed standards for regulation and supervision in the financial services sector and for the prevention of tax fraud and evasion are implemented and applied in its territory. Such internationally agreed standards are, inter alia, the Basel Committee's “Core Principle for Effective Banking Supervision”, the International Association of Insurance Supervisors' “Insurance Core Principles”, the International Organisation of Securities Commissions' “Objectives and Principles of Securities Regulation”, the OECD's “Agreement on exchange of information on tax matters” and the Financial Action Task Force's “Forty Recommendations on Money Laundering” and "Nine Special recommendations on Terrorist Financing".

[ New financial services

The EC Party and ESA Signatory States shall permit a financial service supplier of the other Party to provide any new financial service of a type similar to those services that the Party permits its own financial service suppliers to provide under its domestic law in like circumstances. A Party may determine the juridical form through which the service may be provided and may require authorisation for the provision of the service. Where such authorisation is required, a decision shall be made within a reasonable time and the authorisation may only be refused for prudential reasons. ]

Data processing

1. The EC Party and ESA Signatory States shall permit a financial service supplier of the other Party to transfer information in electronic or other form, into and out of its territory, for data processing where such processing is required in the ordinary course of business of such financial service supplier.

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2. The EC Party and ESA Signatory States shall adopt adequate safeguards to the protection of privacy and fundamental rights, and freedom of individuals, in particular with regard to the transfer of personal data.

Specific exceptions

1. Nothing in this Title shall be construed to prevent the EC Party and ESA Signatory States, including its public entities, from exclusively conducting or providing in its territory activities or services forming part of a public retirement plan or statutory system of social security, except when those activities may be carried out, as provided by the Party's domestic regulation, by financial service suppliers in competition with public entities or private institutions.

2. Nothing in this Agreement applies to activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary or exchange rate policies.

3. Nothing in this Title shall be construed to prevent a Party, including its public entities, from exclusively conducting or providing in its territory activities or services for the account or with the guarantee or using the financial resources of the Party, or its public entities.

Cooperation

1. Subject to the provisions of Article.. [Article 36 of Interim Agreement], the Parties agree to cooperate, with a view to enhance their competitiveness, capacity and efficiency of ESA services and services suppliers in the following areas:

a) Support to enhance the performance and competitiveness of the sector regionally;

b) Technical and financial assistance to develop and strengthen necessary regulatory frameworks;

c) Additional financial resources to local financial providers for on-lending to SMEs;

d) Provision of technical and financial assistance in the harmonisation of insurance legislation, in particular to assist in trade facilitation;

e) Assistance in the development of a regional securities market;f) Support for regional integration initiatives in the financial sector;g) Co-operation both bilaterally and at the multilateral level to increase

mutual understanding and awareness of their respective business environment; and

h) Exchanges of information on financial regulations, financial supervision and control and other aspects of common interest, such as fighting money laundering.

i) establishment of a regional skills training centre on actuarial sciences j) support the harmonisation of listing requirements in the region

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k) support the establishment of automation in the security ad stock exchange operations


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Article XXVI

Telecommunications Services

Scope and definitions

1. This Section sets out the principles of the regulatory framework for all telecommunications services liberalised pursuant to Chapters II, III and IV of this Title except satellite broadcast transmission services.

2. For the purpose of this Section:

(a) ‘telecommunications services’ means:

a. Voice telephone services;b. Packet-switched data transmission services;c. Circuit-switched data transmission services;d. Telex services;e. Telegraph services;f. Facsimile services;g. Private leased circuit services;h. Electronic mail;i. Voice mail;j. On-line information and data base retrieval;k. Electronic data interchange;l. Enhanced/value-added facsimile services, incl. store and forward, store and retrieve;m. Code and protocol conversion;n. On-line information and data processing (incl. transaction processing);o. Internet and Internet access services; andp. Other

(b) a ‘regulatory authority’ in the telecommunications sector means the body or bodies charged with the regulation of telecommunications mentioned in this Chapter

(c) ‘essential telecommunications facilities’ mean facilities of a public telecommunications transport network and service that

- are exclusively or predominantly provided by a single or limited number of suppliers; and

- cannot feasibly be economically or technically substituted in order to provide a service.

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(d) a ‘major supplier’ in the telecommunications sector is a supplier which has the ability to materially affect the terms of participation (having regard to price and supply) in the relevant market for telecommunications services as a result of control over essential facilities or the use of its position in the market.

(e) ‘interconnection’ means linking with suppliers providing public telecommunications transport networks or services in order to allow the users of one supplier to communicate with users of another supplier and to access services provided by another supplier.

(f) ‘universal service’ means the set of services of specified quality that must be made available to all users in the territory of a Party regardless of their geographical location and at an affordable price; its scope and implementation are decided by each Party.

Objectives

1. The objectives of co-operation in the telecommunication services

shall be as follows;

a) to enhance the development of telecommunications and related services in ESA;

(b) to provide affordable, universally accessible and high quality telecommunications services;

(c) to build a competitive regional telecommunication sector by supporting regional initiatives to develop backbone infrastructure in ESA States and enhance interconnectivity in the region; and

(d) to create an enabling environment for sustainable ICT diffusion and development while being cognisant of converging technologies.

Regulatory Authority

1. Regulatory authorities for telecommunications services shall be legally distinct and functionally independent from any supplier of telecommunications services.

2. The regulatory authority shall be sufficiently empowered to regulate the sector. The tasks to be undertaken by a regulatory authority shall be made public in an easily accessible and clear form, in particular where those tasks are assigned to more than one body.

3. The decisions of and the procedures used by regulators shall be impartial with respect to all market participants.

4. A supplier affected by the decision of a regulatory authority shall have a right to appeal against that decision to an appeal body that is independent


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of the parties involved. Where the appeal body is not judicial in character, written reasons for its decision shall always be given and its decisions shall also be subject to review by an impartial and independent judicial authority. Decisions taken by appeal bodies shall be effectively enforced.

Authorisation to provide telecommunications services

1. [Provision of services shall, as much as possible, be authorised following mere notification.[

2. A licence can be required to address issues of attributions of numbers and frequencies. The terms and conditions for such licences shall be made publicly available.

3. Where a licence is required:

(a) all the licensing criteria and a reasonable period of time normally required to reach a decision concerning an application for a licence shall be made publicly available;

(b) the reasons for the denial of a licence shall be made known in writing to the applicant upon request;

(c) the applicant of a licence shall be able to seek recourse before an appeal body in case that a licence is unduly denied;

(d) licence fees required by any Party for granting a licence shall not exceed the administrative costs normally incurred in the management, control and enforcement of the applicable licences

Competitive safeguards on major suppliers

Appropriate measures shall be maintained for the purpose of preventing suppliers who, alone or together, are a major supplier from engaging in or continuing anti-competitive practices. These anti-competitive practices shall include in particular:

(a) engaging in anti-competitive cross-subsidisation;

(b) using information obtained from competitors with anti-competitive results, and;

(c) not making available to other services suppliers on a timely basis technical information about essential facilities and commercially relevant information which are necessary for them to provide services.

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Interconnection

1. Any supplier authorised to provide telecommunications services shall have the right to negotiate interconnection with other providers of publicly available telecommunications networks and services. Interconnection should in principle be agreed on the basis of commercial negotiation between the companies concerned.

2. Regulatory authorities shall ensure that suppliers that acquire information from another undertaking during the process of negotiating interconnection arrangements use that information solely for the purpose for which it was supplied and respect at all times the confidentiality of information transmitted or stored

3. Interconnection with a major supplier shall be ensured at any technically feasible point in the network. Such interconnection shall be provided:

(a) under non-discriminatory terms, conditions (including technical standards and specifications) and rates and of a quality no less favourable than that provided for its own like services or for like services of non-affiliated service suppliers or for its subsidiaries or other affiliates;

(b) in a timely fashion, on terms, conditions (including technical standards and specifications) and cost-oriented rates that are transparent, reasonable, having regard to economic feasibility, and sufficiently unbundled so that the supplier need not pay for network components or facilities that it does not require for the service to be provided, and;

(c) upon request, at points in addition to the network termination points offered to the majority of users, subject to charges that reflect the cost of construction of necessary additional facilities.

4. The procedures applicable for interconnection to a major supplier shall be made publicly available.

5. Major suppliers shall make publicly available either their interconnection agreements or their reference interconnection offers.

6. A service supplier requesting interconnection with a major supplier shall have recourse, either at any time or after a reasonable period of time which has been made publicly known, to an independent domestic body, which may be a regulatory body as referred to in Article […], to resolve disputes regarding appropriate terms, conditions and rates for interconnection


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Scarce resources

Any procedures for the allocation and use of scarce resources, including frequencies, numbers and rights of way, shall be carried out in an objective, timely, transparent and non-discriminatory manner. The current state of allocated frequency bands shall be made publicly available, but detailed identification of frequencies allocated for specific government uses is not required.

Universal service

1. Each Party has the right to define the kind of universal service obligations it wishes to maintain.

2. Such obligations will not be regarded as anti-competitive per se, provided they are administered in a transparent, objective and non-discriminatory way. The administration of such obligations shall also be neutral with respect to competition and be not more burdensome than necessary for the kind of universal service defined by the Party.

3. All suppliers should be eligible to ensure universal service. The designation shall be made through an efficient, transparent and non-discriminatory mechanism. Where necessary, Parties shall assess whether the provision of universal service represents an unfair burden on organisations(s) designated to provide universal service. Where justified on the basis of such calculation, and taking into account the market benefit if any which accrues to an organisation that offers universal service, national regulatory authorities shall determine whether a mechanism is required to compensate the supplier(s) concerned or to share the net cost of universal service obligations.

4. The Parties shall ensure that:

(a) directories of all subscribers are available to users in a form approved by the national regulatory authority, whether printed or electronic, or both, and are updated on a regular basis, and at least once a year;

(b) organisations that provide the services referred to in paragraphs (a) apply the principle of non-discrimination to the treatment of information that has been provided to them by other organisations.

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Confidentiality of information

Each Party shall ensure the confidentiality of telecommunications and related traffic data by means of a public telecommunication network and publicly available telecommunications services without restricting trade in services

Disputes between suppliers

1. In the event of a dispute arising between suppliers of telecommunications networks or services in connection with rights and obligations that arise from this Chapter, the national regulatory authority concerned shall, at the request of either party, issue a binding decision to resolve the dispute in the shortest possible timeframe and in any case within four months.

2. When such a dispute concerns the cross-border provision of services, the national regulatory authorities concerned shall co-ordinate their efforts in order to bring about a resolution of the dispute.

Cooperation

3. Subject to the provisions of Article.. [Article 36 of Interim Agreement], the Parties agree to cooperate, with a view to enhance their competitiveness, capacity and efficiency of ESA services and services suppliers in the following areas :

a) To secure financial and technical assistance to build technical capacity to develop a comprehensive and co-ordinated regulatory framework that reflects the technological dynamism of the sector;b) Supporting implementation of national and regional ICT policies , strategic plans and regulatory frameworks that are under development under the Regional Economic Communities; c) Supporting ESA in achieving convergence in fibre and wireless transmission technologies;d) Supporting the development of regional telecommunications infrastructure through terrestrial, marine cable and other projects; e) Supporting the implementation of information-sharing technologies; andf) Supporting human resource development programmes.

Article XXVII

Electronic Commerce

Scope


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1. For the purpose of this title, e-commerce includes: Services transactions which involve secure online transactions involving trading, marketing , selling and payment of goods and services on the internet ]

Objectives

2. The Parties recognising that electronic commerce increases trade opportunities in many sectors, agree to promote the development of electronic commerce between them, in particular by co-operating in issues raised by e-commerce under the provisions of this Title.

3 [The Parties agree that the development of electronic commerce must be fully compatible with international standards of data protection, intellectual property, and privacy and security transactions.

4 The Parties are to determine whether electronic commerce should be subjected to customs duties or taxation only in the deliveries should be online]

Regulatory aspects of e-commerce

1. The parties shall maintain a dialogue on regulatory issues raised by electronic commerce, which will inter alia address the following issues:

- the recognition of certificates of electronic signatures issued to the public and the facilitation of cross-border certification services,

- the liability of intermediary service providers with respect to the transmission, or storage of information,

- the treatment of unsolicited electronic commercial communications,

- the protection of consumers in the ambit of electronic commerce,

- any other issue relevant for the development of electronic commerce.

2. Such cooperation can take the form of exchange of information on the Parties’ respective legislation on these issues as well as on the implementation of such legislation.

Co-operation

5. Subject to the provisions of Article.. [Article 36 of Interim Agreement], the Parties agree to cooperate, with a view to enhance their

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competitiveness, capacity and efficiency of ESA services and services suppliers in the following areas:

a. Secure financial and technical assistance to build capacity for the implementation of e commerce.

b. .Assistance to implement best practices relating to international standards of data protection and security in relation to e commerce

c. To develop e commerce between ESA states and the global market

d. Support the implementation of an e market place in each ESA state to facilitate e commerce.

e. Training in the in the use of computers and accessing internet.

f. Providing capacity in electronic commerce backbone equipment (ICT) to enable access for ESA countries.

g. Assistance in building a strong regulatory framework especially the International E-commerce Law.


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Article XXVIII

Postal and Courier Services

Scope, definitions and principles

1. This Section sets out the principles regarding the liberalisation of international maritime transport services pursuant to Chapters II, III and IV of this Title.

2. For the purpose of this Section and Chapters II, III and IV of this Title:

(a) "international maritime transport" includes door to door and multi-modal transport operations, which is the carriage of goods using more than one mode of transport, involving a sea-leg, under a single transport document, and to this effect directly contract with providers of other modes of transport;

(b) "maritime cargo handling services" means activities exercised by stevedore companies, including terminal operators, but not including the direct activities of dockers, when this workforce is organised independently of the stevedoring or terminal operator companies. The activities covered include the organisation and supervision of:

- the loading/discharging of cargo to/from a ship;

- the lashing/unlashing of cargo;

- the reception/delivery and safekeeping of cargoes before shipment or after discharge;

(c) "customs clearance services" (alternatively 'customs house brokers' services') means activities consisting in carrying out on behalf of another party customs formalities concerning import, export or through transport of cargoes, whether this service is the main activity of the service provider or a usual complement of its main activity;

(d) "container station and depot services" means activities consisting in storing containers, whether in port areas or inland, with a view to

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their stuffing/stripping, repairing and making them available for shipments;

(e) "maritime agency services" means activities consisting in representing, within a given geographic area, as an agent the business interests of one or more shipping lines or shipping companies, for the following purposes:

- marketing and sales of maritime transport and related services, from quotation to invoicing, and issuance of bills of lading on behalf of the companies, acquisition and resale of the necessary related services, preparation of documentation, and provision of business information;

- acting on behalf of the companies organising the call of the ship or taking over cargoes when required;

(f) "freight forwarding services" means (the activity consisting of organising and monitoring shipment operations on behalf of shippers, through the acquisition of transport and related services, preparation of documentation and provision of business information).

3. In view of the existing levels of liberalisation between the Parties in international maritime transport:

(a) the Parties shall apply effectively the principle of unrestricted access to the international maritime markets and trades on a commercial and non-discriminatory basis;

(b) each Party shall grant to ships flying the flag of the other Party or operated by service suppliers of the other Party treatment no less favourable than that accorded to its own ships with regard to, inter alia, access to ports, use of infrastructure and auxiliary maritime services of the ports, as well as related fees and charges, customs facilities and the assignment of berths and facilities for loading and unloading.

4. In applying these principles, the parties shall:

(a) not introduce cargo-sharing arrangements in future bilateral agreements with third countries concerning maritime transport services, including dry and liquid bulk and liner trade, and terminate, within a reasonable period of time, such cargo-sharing arrangements in case they exist in previous bilateral agreements; and

(b) upon the entry into force of this Agreement, abolish and abstain from introducing any unilateral measures and administrative,


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technical and other obstacles which could constitute a disguised restriction or have discriminatory effects on the free supply of services in international maritime transport.

5. Each Party shall permit international maritime service suppliers of the other Party to have an establishment in its territory under conditions of establishment and operation no less favourable than those accorded to its own service suppliers or those of any third country, whichever are the better.

6. The Parties shall make available to international maritime transport suppliers of the other Party on reasonable and non discriminatory terms and conditions the following services at the port: pilotage, towing and tug assistance, provisioning, fuelling and watering, garbage collecting and ballast waste disposal, port captain’s services, navigation aids, shore-based operational services essential to ship operations, including communications, water and electrical supplies, emergency repair facilities, anchorage, berth and berthing services.

Objectives

Co-operation

Article XXIX

Maritime Transport

Scope, definitions and principles

2. For the purpose of this Section::

(a) "international maritime transport" includes door to door and multi-modal transport operations, which is the carriage of goods using more than one mode of transport, involving a sea-leg, under a single transport document, and to this effect directly contract with providers of other modes of transport;

(b) "maritime cargo handling services" means activities exercised by stevedore companies, including terminal operators, but not including the direct activities of dockers, when this workforce is organised independently of the stevedoring or terminal operator companies. The activities covered include the organisation and supervision of:

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- the loading/discharging of cargo to/from a ship;

- the lashing/unlashing of cargo;

- the reception/delivery and safekeeping of cargoes before shipment or after discharge;

(c) "customs clearance services" (alternatively 'customs house brokers' services') means activities consisting in carrying out on behalf of another party customs formalities concerning import, export or through transport of cargoes, whether this service is the main activity of the service provider or a usual complement of its main activity;

(d) "container station and depot services" means activities consisting in storing containers, whether in port areas or inland, with a view to their stuffing/stripping, repairing and making them available for shipments;

(e) "maritime agency services" means activities consisting in representing, within a given geographic area, as an agent the business interests of one or more shipping lines or shipping companies, for the following purposes:

- marketing and sales of maritime transport and related services, from quotation to invoicing, and issuance of bills of lading on behalf of the companies, acquisition and resale of the necessary related services, preparation of documentation, and provision of business information;

- acting on behalf of the companies organising the call of the ship or taking over cargoes when required;

(f) "freight forwarding services" means (the activity consisting of organising and monitoring shipment operations on behalf of shippers, through the acquisition of transport and related services, preparation of documentation and provision of business information).

2. The objective of this Title is to develop adequate, cost-effective and efficient maritime transport services, enhance the safety of navigation and assure a clean marine environment, in order to facilitate international trade and enhance economic growth.

3. In view of the existing levels of liberalisation between the Parties in international maritime transport:


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(a) the EC Party and signatory ESA states shall apply effectively the principle of unrestricted access to the international maritime markets and trades on a commercial and non-discriminatory basis;

(b) the EC Party and signatory ESA states shall grant to ships flying the flag of the other Party or operated by service suppliers of the other Party treatment no less favourable than that accorded to its own ships with regard to, inter alia, access to ports, use of infrastructure and auxiliary maritime services of the ports, as well as related fees and charges, customs facilities and the assignment of berths and facilities for loading and unloading.

4. In applying these principles, the parties shall:

(a) not introduce cargo-sharing arrangements in future bilateral agreements with third countries concerning maritime transport services, including dry and liquid bulk and liner trade, and terminate, within a reasonable period of time, such cargo-sharing arrangements in case they exist in previous bilateral agreements; and

(b) upon the entry into force of this Agreement, abolish and abstain from introducing any unilateral measures and administrative, technical and other obstacles which could constitute a disguised restriction or have discriminatory effects on the free supply of services in international maritime transport.

5. the EC Party and signatory ESA states shall permit international maritime service suppliers of the other Party to have an establishment in its territory under conditions of establishment and operation no less favourable than those accorded to its own service suppliers or those of any third country, whichever are the better.

6. the EC Party and signatory ESA states shall make available to international maritime transport suppliers of the other Party on reasonable and non discriminatory terms and conditions the following services at the port: pilotage, towing and tug assistance, provisioning, fuelling and watering, garbage collecting and ballast waste disposal, port captain’s services, navigation aids, shore-based operational services essential to ship operations, including communications, water and electrical supplies, emergency repair facilities, anchorage, berth and berthing services

Co-operation

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This should be deleted

user, 26/06/08,

What is the implication of this title for the licence fees charged in the context of fisheries???


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a. Provision of technical and financial resources for the establishment of regional shipping lines, which would greatly facilitate intraregional trade and interconnectivity among the mainland and island ESA States;b. Provision of support for capacity building in island states to address their supply-side constraints in trading with the rest of the world; andc. Provision of technical and financial assistance to establish and upgrade existing maritime training facilities, and to accredit such facilities in accordance with IMO standards.

Article XXX

Inland Water Transport

Scope

1 For the purposes of this Title, inland water transport services includes the following;

(a) passenger transportation;(b) freight transportation;(c) hire or lease of vessels or vessels with crew;(d) maintenance and repair of vessels;(e) pushing and towing services; and(f) support services for maritime transport(g) ports and(h) other landing sites and associated services

Objectives

Co-operation

Article XXXI

Air Transport Services

Scope

1. For the purposes of this Title, air transport services include the following; (a) Passenger transportation;(b) Freight transportation;


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(c) Hire or lease of aircraft or aircraft with crew;(d) Maintenance and repair of aircraft; and(e) Support services for air transport(f) in-flight catering services (g) What about ground handling services(h) And pushing and towing

Objectives

2. The aim of the co-operation in this sector shall be to;(a) Strengthen the capacity of airlines in the ESA region to provide air

transport services by increasing their competitiveness; and(b) Improve the safety and security of air transport.

Co-operation


a) Supporting the development of air transport infrastructure facilities and systems;b) Supporting the region in improving safety and security standards in line with standards under International Civil Aviation Authority (ICAO) and International Air Transport Authority (IATA);c) Providing support in the development of ICT infrastructure to improve the performance of the sector; and d) Supporting the development of the regulatory environment, including the national and regional air transport regulatory authorities.

Article XXXII

Road and Rail Services

Scope

1. For the purpose of this Title, road and rail services include;

(a) Passenger transportation;

(b) Freight transportation;

(c) Hire or lease of commercial vehicles with operator;

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(d) Maintenance and repair of transport equipment;

(e) Supporting services for road and rail transport services; and

(f) Pushing and towing services.

(g) What about cabotage services or restriction?

Objectives

2. To support the development of inter-modal infrastructure networks and transport systems that are adequate and economically viable and environmentally sustainable; and

3. To support co-operation among ESA States in the development of sustainable road and rail transport networks.

Co-operation


a) Supporting the development of road and rail infrastructure facilities and systems;b) Providing support in implementing regional trade facilitation instruments, procedures and mechanisms, taking cognisance of the special needs of land-locked ESA States;c) Providing support for improvement of safety and security in road and rail transport;d) Providing support in meeting international standards for mobile and fixed equipment and infrastructure;e) Providing support in the development of an appropriate regulatory framework;f) Providing financial support to the relevant regional infrastructure Fund; g) Providing support to public-private partnerships in the development and management of road and rail networks and services; andh) Contributing to the restructuring and modernisation of road and rail transport.

Article XXXIII

Legal Services [Professional services]

Scope

1. For the purpose of this Title, legal services mean;


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(a) legal advisory and representation services concerning criminal law;(b) legal advisory and representation services in judicial procedures concerning other fields of law;(c) legal advisory and representation services in statutory procedures of quasi-judicial tribunals, boards, among others;(d) legal documentation and certification services;(e) insolvency and receivership services; and(f) Other legal services.

Objectives

2. The aim of the co-operation shall be to;

(a) Develop the regional supply capacity of diversified legal services; and

(b) Facilitate intra-regional trade in legal services.

Co-operation


a. Providing support in the development of mutual recognition and harmonisation among ESA States’ differing legal systems;b. Providing support for harmonisation of market access rules and regulations;c. Providing support for harmonisation of licensing and registration procedures; andd. Recognition by the EU and its Member States of legal qualifications issued by ESA States.

Article XXXIV

Construction and Related Engineering Services

Scope

1. For the purpose of this Title, construction and related engineering services refers to the following:

(a) general construction work for buildings;(b) general construction work for civil engineering;(c) installation and assembly work;(d) building completion and finishing work; and(e) Other.

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Objectives

2. The aims of the co-operation shall be the following;

(a) Developing a competitive and well regulated construction and related engineering sector;

(b) enabling ESA states to have access to a wider range and depth of construction and related engineering services, higher operating standards, technology and skills transfer and lower construction costs; and

(c) Increasing the participation of ESA contractors in construction activities in the region.

Co-operation


a) Providing support for the development of SMEs in the ESA construction sector;b) Providing support to the development and strengthening of technical capacities;c) Providing support to ESA regulatory frameworks and institutions;d) Providing support to training institutions, including internationally accredited specialist training institutions; e) Promotion and implementation of mutual recognition agreements within the region;f) Providing support for investment in the development and production of construction materials and equipment; g) Providing support for the harmonisation of material specifications and building standards and common specifications;h) Providing support in the exchange of information, technology, best practices within ESA and with EU institutions, research and development institutions and centres of learning, among others.i) Facilitate the development of SMEs in the ESA Construction sector through establishment of contractor support agencies;j) Facilitating the setting up of public commercial plant pools that would rent machinery to SMEs with the aim of strengthening their capacity to effectively supply services in the ESA construction sector;k) Providing support for the establishment of construction and materials information centres in ESA states, that will facilitate the exchange of information, technology and best practices both within the ESA and with the EU.


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Article XXXV

Energy Services

Scope

1. For the purpose of this Title, energy services cover:

(a) services required at each step of energy process from location, extraction, transmission and distribution to the final consumer, i.e. exploration, extraction, drilling and pipeline construction services, transmission and distribution.

(b) services relating to bio-energy,(c) services relating to renewable energy such as solar and wind energy.

Objectives

2. The aims of the co-operation shall be the following

(a) to benefit from the energy services accruing from each process of the energy sector

(b) To share energy services between the ESA region and the EU in order to boost capacity of the abundant energy resources in the ESA region.

(c) Regional integration in electricity power pools(d) Training of energy personnel.

Co-operation


a) Providing support for the building of intra-ESA capacity to supply services through establishment and upgrading of centres for specialist training, inter alia, for the provision of specialised design, repair and maintenance of power systems and infrastructure;b) Providing support for the development of regulatory frameworks that will encourage public-private partnerships, in particular, in meeting rural electrification needs; c) Providing support for the development of diversified electricity sources and in the development of the regional energy service market; andd) Providing support for the rational use and development of renewable energy resources including the transmission and consumption of renewable energy sources and technology”.

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e) “Providing support for the research and development of diversified energy sources including renewable energy sources and technology”.

Article XXXVI

Professional Services

Scope

1. For the purpose of this Title, professional services cover

a. Legal Services 861

b. Accounting, auditing and bookkeeping services 862

c. Taxation Services 863

d. Architectural services 8671

e. Engineering services 8672

f. Integrated engineering services 8673

g. Urban planning and landscape 8674

Architectural services

h. Medical and dental services 9312

i. Veterinary services 932

j. Services provided by midwives, nurses,

physiotherapists and para-medical personnel 93191

k. Other

2. The objectives of co-operation in this sector shall be as follows:

(a) To develop regional capacity in the supply of professional services

(b) Increase export capacity of ESA professional services suppliers in

the EU market

Co-operation



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a) Support human resource development in order to meet international standards

b) Support in development a regional mutual recognition agreement c) Support in developing domestic regulations d) Capacity-building for professional services suppliers in access to

distribution networks, marketing and e-commerce e) To develop regional capacity in the supply of professional services

f) Increase export capacity of ESA professional services suppliers in the EU

market

Article XXXVII

Statistics on International Trade in Services

1. The Parties agree, in line with Trade Facilitation Chapter Article….. (Co-operation on Trade Statistics) in the EPA Text of this Agreement, to develop compatible systems for statistics on trade in services.

2. Subject to the provisions of Article.. [Article 36 of Interim Agreement], the Parties agree to cooperate, with a view to enhance their competitiveness, capacity and efficiency in the following areas;

a) technical, financial and logistical support to facilitate setting up of national statistics bodies and regional statistical agency on trade in services; and

b) Support in phased implementation of the “UN Manual on Statistics of International Trade in Services” by ESA States]

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Article XXXVII

Educational Services

Article XXXIX

Medical Services

Annex on Movement of Natural Persons Supplying Services under this Agreement

ESA Proposal

Movement of Natural Persons [Definitions]

1. This Article applies to measures of the Parties concerning the entry and temporary stay into their territories of key personnel, business service sellers, contractual service suppliers and independent professionals

2. For the purpose of this Article:

(a) “key personnel” means natural persons employed within a juridical person other [[within EU]] than a non-profit organisation and whose work and temporary stay is necessary for the setting-up or the proper control, administration and operation of a commercial presence. Key personnel comprises business visitors responsible for setting up a commercial presence and intra-corporate transfers.

(i) “business visitors” means natural persons working in a senior position who are responsible for setting up a commercial presence. They do not engage in making direct sales to the general public and do not receive remuneration from a source within the host Party.(ii) “intra-corporate transfers” means natural persons who have been employed by a juridical person or have been partners in it (other than as majority shareholders) for at least one year and who are temporarily transferred to a commercial presence in the territory of the other Party. The natural person concerned must belong to one of the following categories:

1. managers:

persons working in a senior position within a juridical person, who primarily direct the management of the commercial presence, receiving general supervision or direction principally from the board of directors of stockholders of the business or their equivalent, including;

directing the commercial presence or a department or sub-division thereof;


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supervising and controlling the work of other supervisory, professional or managerial employees;

having the authority personally to recruit and dismiss or recommend recruiting, dismissing or other personnel actions.

2. specialists:

persons working within a juridical person who possess uncommon knowledge essential to the commercial presence’s production, research equipment, techniques or management. In assessing such knowledge, account will be taken not only of knowledge specific to the commercial presence, but also of whether the person has a high level of qualification referring to a type of work or trade requiring specific technical knowledge, including membership or an accredited profession.

3. graduate trainees:

persons working within a juridical person who possess a university degree and are transferred for career development purposes or to obtain training in business techniques or methods. The recipient commercial presence may be required to submit a training programme covering the duration of stay for prior approval, demonstrating that the purpose of the stay is for training.

(b) “business service sellers” means natural persons who are representatives of a service supplier of one Party seeking temporary entry into the territory of the other Party for the purpose of negotiating the sale of services or entering into agreements to sell services for that service supplier. They do not engage in making direct sales to the general public and do not receive remuneration from a source located within the host Party.

(c) “contractual service suppliers” means natural persons employed by a juridical person of one Party established in accordance with the legislation of this Party on its territory which [may have no] commercial presence in the territory of the other Party and which [intends to conclude or] has concluded a bona fide contract to supply services with a consumer in the latter Party requiring the presence of a temporary basis of its employees in that Party in order to fulfil the contract to provide services.

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(d) “independent professionals” means natural persons who engage in the supply of a service and established as self-employed in the territory of a Party who [may not] have commercial presence in the territory of the other Party and who [intends to conclude or] have concluded a bona fide contract to supply services with a consumer in the latter Party\ requiring their presence on a temporary basis in that Party in order to fulfil the contract to provide services.

(e) [Semi, middle, low-skilled labour categories as defined by ILO.]

[Replace above with following Alternative Article 22

The EC Party and a signatory ESA State shall, through a process of negotiations, agree on the categories of natural persons for which each Party will make comprehensive commitments in the first Schedule. Particular attention will be given to the inclusion of categories that meet the export interests of ESA States]

EC Proposal

Article 17

Coverage

1. This Chapter applies to measures of the Parties concerning the entry and temporary stay into their territories of key personnel, graduate trainees, business services sellers, contractual services suppliers and independent professionals in accordance with Article 1 paragraph 5, of this Title.

2. For the purpose of this Chapter:

(a) ‘Key personnel’ means natural persons employed within a juridical person of one Party other than a non-profit organisation and who are responsible for the setting-up or the proper control, administration and operation of an establishment.

‘Key personnel’ comprises ‘business visitors’ responsible for setting up an establishment and ‘intra-corporate transfers’.

(i) ‘Business visitors’ means natural persons working in a senior position who are responsible for setting up an establishment. They do not engage in direct transactions with the general public and do not receive remuneration from a source located within the host Party.

(ii) ‘Intra-corporate transfers’ means natural persons who have been employed by a juridical person of one Party or have been partners in it (other than as majority shareholders) for


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at least one year and who are temporarily transferred to an establishment in the territory of the other Party. The natural person concerned must belong to one of the following categories:

1. Managers:

Persons working in a senior position within a juridical person, who primarily direct the management of the establishment, receiving general supervision or direction principally from the board of directors or stockholders of the business or their equivalent, including:

– directing the establishment or a department or sub-division thereof;

– supervising and controlling the work of other supervisory, professional or managerial employees;

– having the authority personally to recruit and dismiss or recommend recruiting, dismissing or other personnel actions.

2. Specialists:

Persons working within a juridical person who possess uncommon knowledge essential to the establishment’s production, research equipment, techniques or management. In assessing such knowledge, account will be taken not only of knowledge specific to the establishment, but also of whether the person has a high level of qualification referring to a type of work or trade requiring specific technical knowledge, including membership of an accredited profession.

(b) ‘graduate trainees’ means natural persons working within a juridical person of one Party who possess a university degree and who are temporarily transferred to an establishment in the territory of the other Party for career development purposes or to obtain training in business techniques or methods11

(c) ‘business services sellers’ means natural persons who are representatives of a service supplier of one Party seeking temporary entry into the territory of the other Party for the purpose of negotiating the sale of services or entering into agreements to sell services for that service supplier. They do not engage in

11 The recipient establishment may be required to submit a training programme covering the duration of stay for prior approval, demonstrating that the purpose of the stay is for training.

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making direct sales to the general public and do not receive remuneration from a source located within the host Party.

(d) ‘contractual services suppliers’ means natural persons employed by a juridical person of one Party which has no establishment in the territory of the other Party and which has concluded a bona fides contract to supply services with a final consumer in the latter Party requiring the presence on a temporary basis of its employees in that Party in order to fulfil the contract to provide services

(e) ‘independent professionals’ means natural persons engaged in the supply of a service and established as self-employed in the territory of a Party who have no establishment in the territory of the other Party and who have concluded a bona fides contract to supply services with a final consumer in the latter Party requiring their presence on a temporary basis in that Party in order to fulfil the contract to provide services. 12

Article 18

Key personnel and graduate trainees

1. For every sector liberalised in accordance with Chapter II of this Title and subject to any reservations listed in Annex […] (list of commitments on establishment) or in Annex […] (reservations on key personnel and graduate trainees), each Party shall allow investors of the other Party to employ in their establishment natural persons of that other Party provided that such employees are key personnel or graduate trainees as defined in Article […]. The temporary entry and stay of key personnel and graduate trainees shall be for a period of up to […]

2. For every sector liberalised in accordance with Chapter II of this Title, the measures which a Party shall not maintain or adopt, unless otherwise specified in Annex [ ] (reservations on key personnel and graduate trainees), are defined as limitations on the total number of natural persons that an investor may employ as key personnel or graduate trainees in a specific sector in the form of numerical quotas or a requirement of an economic needs test.

12 The services contract referred to under (d) and (e) shall comply with the laws, regulations and requirements of the Party where the contract is executed.


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Article 19

Business services sellers

For every sector liberalised in accordance with Chapter II or Chapter III of this Title and subject to any reservations listed in Annex […] (list of commitments on cross-border supply of services), each Party shall allow the temporary entry and stay of business services sellers for a period of up to […] in any twelve month period

Article 20

Contractual services suppliers and independent professionals

1. The Parties reaffirm their respective obligations arising from their commitments under the GATS as regards the entry and temporary stay of contractual services suppliers and independent professionals.

2. [CONTENT TO BE DEFINED BY THE PARTIES IN THE COURSE OF THE NEGOTIATIONS]

3. [CONTENT TO BE DEFINED BY THE PARTIES IN THE COURSE OF THE NEGOTIATIONS]

Text as agreed in Brussels June 2008-06-26

PART V

TRADE RELATED ISSUES

TITLE 1

GENERAL PROVISIONS

ARTICLE 28

Scope and Coverage

1. The scope of trade related issues shall be, but not limited to, competition and consumer policy, intellectual property rights, trade and investment, trade and environment and sustainable development and transparency in government procurement.

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Article 29

Objectives

1. The Parties recognise the importance of trade-related issues and shall enhance their cooperation to achieve the following objectives:

a) Strengthening the capacity of ESA countries and region to deal with all aspects of trade related issues and services.

b) Enhance the benefits of trade related issues for intra ESA trade and for the progressive integration of ESA region in the world economy and strengthening their cooperation in these areas.

Title II

COMPETITION POLICYArticle 1

Definitions

For the purposes of this Chapter:

1. “Competition authority” means for the EC Party, the "European Commission"; and for the ESA Signatory States, National Competition Commissions.

2. "Enforcement proceeding" means a proceeding instituted by the competent competition authority of a Party against one or more undertakings with the aim of establishing and remedying anti-competitive behaviour.

3. "Competition laws" includes:

(a) for the EC Party, Articles 81, 82 and 86 of the Treaty establishing the European Community, and their implementing regulations or amendments;

(b) For ESA Signatory States, Art 55 of the COMESA Treaty and the implementing regulation and national legislations complying with the COMESA Treaty (subject to consultations by member states)


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Article 2

Objectives

1. The parties recognise the importance of promoting and encouraging competition by monitoring, controlling and preventing restrictive business practices and other restrictions that deter or likely to deter the efficient operation of markets, thereby enhancing equitable business growth and development.

2 In this regard, the parties, agree that the following shall be prohibited as incompatible with the proper functioning of the Agreement, in so far as they may affect trade in the EU or in the territory of any of the ESA countries:

( a ) All categories of agreements, decisions and concerted practices which have as their object or effect the prevention, restriction or distortion of competition to an appreciable extent in the EU or the territories of any of the ESA countries or in any substantial part of any of the either territories;

(b) Any abuse by one or more undertakings of a dominant position within the EU or in the territory of any of the ESA countries or in a substantial territory of either party where such abuse may or does affect trade in the EU or in the territories of any ESA Countries.

Article 3

Implementation

1. The parties shall ensure that they have in place laws and regulations in force addressing restrictive business practices on competition practices mentioned in Article 1 within their respective national jurisdictions, and a government or statutory body designated for the implementation of such laws and regulations.

2. If, at the moment of entry into force of this agreement, either party has not yet adopted such laws and regulations at national level, nor designated a government and statutory body for their implementation, it shall do so within a period of five years.

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Article 4

Scope of Application.

1. This Agreement shall apply to economic activities whether conducted primarily by private enterprises within, or having an effect within, the EU or in the territory of any of the ESA countries which restrict competition and have an appreciable effect on trade in the EU or in the territory of any of the ESA countries. This Agreement does not apply to conduct expressly exempted by national legislation for ESA Signatory States.

2. This Agreement shall not derogate the direct enjoyment of the privileges and protections conferred by other laws protecting intellectual property, including inventions, industrial models, trade marks, patents, and copyright.

3. The participation of the ESA countries shall be subject to the provisions of the National laws and regulations and the COMESA Regional Competition Regulations and Rules.

Article 5

Obligations of Parties 1. The parties are encouraged to take all appropriate measures, whether

general or particular, to ensure fulfilment of the obligations arising out of this Agreement or resulting from action taken by the (joint council) under this Agreement.

2. The parties may, but shall not be obliged to, implement in their domestic laws more extensive provisions against restrictive business practices than is required by this Agreement, provided that such provisions do not contravene the provisions of this Agreement. The parties shall be free to determine the appropriate method of implementing the provisions of this Agreement within their national legal system and practice as long as such method of implementation enhances the efficient and effective attainment of the objectives of this Agreement. .

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Article 6

Public enterprises and enterprises entrusted with special or exclusive rights

including designated monopolies

1. Nothing in this Agreement prevents the Parties from designating or maintaining public enterprises entrusted with special or exclusive rights, including designated monopolies according to their respective laws.

2. With regard to public enterprises and enterprises to which special or exclusive rights have been granted, the Parties shall ensure that, following the date of the entry into force of this Agreement, there is neither enacted nor maintained any measure distorting trade in goods or services between the Parties to an extent contrary to the Parties interest, and that such enterprises shall be subject to the rules of competition in so far as the application of such rules does not obstruct the performance, in law or in fact or the particular tasks assigned to them.

3. By derogation from Article 6(2), the Parties agree that where enterprises in the Signatory ESA States are subject to specific sectoral rules as mandated by their respective regulatory frameworks, such enterprises or specific products of strategic importance that are subject to special treatment shall not be bound or governed by the provisions of this Article.

4. Without prejudice to paragraph 3 above, the Parties may progressively adjust, without prejudice to their obligations under the WTO Agreement, any State monopolies of a commercial nature or character, so as to ensure that, by the end of the fifth year following the entry into force of this Agreement, no discrimination regarding the conditions under which goods and services are sold or purchased exists between nationals of the Member States of the European Communities and those of the ESA States, unless such discrimination is inherent in the existence of the monopoly in question.

5. The Joint ESA - EC Committee shall be informed about the enactment of sectoral rules provided for in paragraph 3 and the measures adopted to implement paragraph 4.

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Legal counsel to provide advise

Isabelle, 26/06/08,

Legal counsel to provide advice


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Article 7

Exchange of Information and Cooperation

1. 1. The parties agree to promote cooperation and coordination regarding the application of their competition laws in their respective territories and to provide mutual assistance in any fields of competition they consider necessary.

2. The parties shall consult on the written request of a party, to consider matters regarding the operation, implementation, application of this chapter and to review the parties’ measures to prescribe anticompetitive activities and the effectiveness of enforcement actions. Each party shall designate one or more officials, including an official from each competition authority, to be responsible for ensuring that consultations, when required, occur in a timely manner.

3. Each Party shall, at the request of any other country party to this agreement, enter into consultations with a view to eliminating practices referred to in Article 1. The party addressed shall accord full consideration to such a request and shall cooperate through the supply of publicly available non-confidential information of relevance to the matter in question. The Party addressed shall also provide other information available to the requesting Party, subject to its domestic law and to the conclusion of satisfactory agreement concerning the safeguarding of its confidentiality by the requesting Party. All exchange of information shall be subject to the standards of confidentiality applicable in each Party.

4. The EC and ESA parties shall cooperate with the view to ensure that the ESA party meets the standards of confidentiality of data and information exchanged between the Parties.

5. Such a request shall not prejudice any action under the requesting Party`s competition laws that may be deemed necessary and shall not in any way encumber the party’s decision-making powers or its independence.

Article 8

Technical Assistance and Capacity Building.

1. The Parties agree on the importance of technical assistance and capacity-building to facilitate the implementation of the commitments and achieve the objectives of this Chapter and in particular to ensure effective and sound competition policies.

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CARIFORUM Text


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2. The technical assistance and capacity building programs shall pay systematic attention to institutional aspects and in this context shall support the efforts of each of the ESA countries to develop and strengthen structures, institutions and procedures that help to enhance the effective enforcement of the competition in each of the ESA Countries. In this context, the EU shall:

(a) Accept and recognise the low level of development of the ESA countries in competition matters. To this end, the EU countries shall commit adequate technical, financial and material resources to the ESA countries to enable them to implement this process of technical assistance cooperation and to implement their obligations and commitments. Such resources should be provided by the EU States on a sufficiently predicable and sustainable basis;

(b) Provide technical assistance cooperation aimed at assisting each of the ESA Countries in the development and strengthening of national competition authorities. The activities to be covered should be diverse in scope and nature, and shall include technical assistance and capacity building development, staff training and exchanges, holding of joint training and capacity building programmes;

(c) Facilitate and assist in the setting up of competition authorities in ESA Countries that have no such institutions, assist in the enactment of the competition law, and the review of such laws aimed at making them effective;

(d) Facilitate and develop competition advocacy programmes involving the sensitisation of policy makers, parliamentarians, the judiciary, the business community, and the general public about the role of competition laws and;

(e) Facilitate the establishment of a mechanism to enable each ESA Country to take the necessary steps to adopt, strengthen and implement the necessary competition and consumer protection laws in their respective countries.

3. The (joint council) with a view to improving the effectiveness of the on-going cooperation, shall establish a mechanism to undertake a joint review of the effectiveness of the technical assistance program after the Agreement comes into force. The purpose of such a review shall be to determine the benefits accruing to each of the ESA countries under this Agreement and the level of commitment by the EU countries in the provision of technical, financial, and capacity building assistance to each of the ESA countries. Such a review shall include a mutually agreed program of action between the


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parties on how to improve the implementation and enforcement of the competition law in their respective territories.

4. Any ESA country may opt to suspend the operation of this Chapter in its country provided it is able to demonstrate in good faith to the (joint council) that its level of development in competition law is still low and that it is not yet benefiting adequately from this process of technical assistance cooperation.

5. The technical assistance and capacity building programs shall be pursued through integrated strategies that incorporate economic, social, cultural, environmental and institutional elements that must be locally owned. In this context and within the framework of development policies and reforms pursued by the ESA countries; the EU-ESA cooperation framework and orientation shall take into account of each of the ESA country’s different levels of development as well as the economic needs of each ESA country and the difficulties faced in meeting their obligations in this Agreement.

6 The Parties agree to cooperate, including by facilitating support, in the following areas:

(a) the efficient functioning of the ESA Signatory States’ Competition Authorities;

(b) assistance in drafting guidelines, manuals and, where necessary, legislation;

(c) the provision of independent experts; and(d) the provision of training for key personnel involved in the

implementation of and enforcement of competition policy.

TITLE II

INTELLECTUAL PROPERTY RIGHTS

DRAFT AMENDED 20 APRIL 2008

Article 64

Scope and Coverage

1. For the purpose of this Title, intellectual property covers copyright and related rights; industrial property rights; plant breeders rights; rights to traditional knowledge, folklore and genetic resources; and other rights recognised under the TRIPS Agreement and CBD and the International Agreement on Plant Genetic Resources

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Article 65

Objectives

The objectives of cooperation in intellectual property rights shall be:

1. To ensure availability of legal, institutional and human resource capacities and policy frameworks for the protection of intellectual property rights whilst respecting and safeguarding public policies of ESA countries

2. Ensuring the economic development and social expansion of an ESA Country economy is not hampered by a restricted application of international and bilateral obligations in the area of intellectual property rights,

3. Ensuring the implementation of the flexibilities as are provided under the TRIPS Agreement and CBD and the International Agreement on Plant Genetic Resources

4. To facilitate technology transfer amongst the parties and especially to the ESA countries

5. To ensure adequate and effective protection of genetic resources, traditional knowledge and folklore of ESA countries, [creative and artistic arts] and prevent bio-piracy

6. To ensure that the legitimate interests of the ESA countries are safeguarded

2. To provide for enhanced incentives for the development and research into new technologies especially in pharmaceutical products, including the production of generic medicine. 3. To ensure that claims of ownership of seeds and plant products cannot be transferred onto similar natural resources endemic to the ESA region

4. To provide support for the development and research to identify geographical indications on products of ESA countries. In the case of livestock this will include the Breed Characterisation Inventory

5. To grant legal protection to geographical indications identifying products of ESA countries in both the Community and among ESA countries


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Article 66

Areas of Cooperation

1. The Parties shall strengthen their cooperation in all areas of intellectual property, including in the following areas:

a) Promotion of innovation, diversification, modernisation, development and product and process quality in businesses

b) Promotion of creativity and design, particularly in micro, small and medium enterprises, and exchanges between networks of design centres located in ESA and EU states

c) Science and technology capacity building in ESA statesd) the availability of legal, institutional and policy frameworks

necessary for the implementation of the TRIPS Agreement whilst respecting the flexibilities therein, and the CBD and the International Agreement on Plant Genetic Resources

e) the establishment and reinforcement, including training of personnel, of national and regional intellectual property offices dealing in intellectual property matters

f) Appropriate measures for the effective protection of ESA countries genetic resources, folklore and traditional knowledge and against bio piracy;

g) Work on the development of internationally agreed sui generis models for the protection of traditional knowledge and sustainable use of biological diversity and to promote wider application of genetic resources, traditional knowledge and folklore with the involvement and approval of the holders of such knowledge, innovations and practices and encourage the equitable sharing of the benefits arising the from the utilisation of such knowledge, innovations and practices.

g) prevention of abuse of intellectual property rights by their holders

h) Creation of awareness on IPR through an information exchange system with the aim to update each other on IPR development on time

2. EU shall support ESA countries to enable them benefit from the relevant provisions of the WTO Agreement on TRIPs and the in-built flexibilities especially with regard to public health, including access to pharmaceutical products at a reasonable price;

3. EU shall support ESA countries to enact appropriate laws, formulate policies and develop infrastructure for local production of pharmaceutical products, transfer of technology and the attraction of investment in their pharmaceutical sectors;

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4. The EU shall provide incentives to enterprises and institutions in its territory for the purpose of promoting and encouraging technology transfer to ESA countries in order to enable them create a sound and viable technological base.

Article 67

Implementation

1. The implementation of this Title shall be reviewed after 5 years as from the date of signing this agreement. Such review may also include any relevant new developments that might warrant modification or amendment of this Title

2. In order to facilitate the implementation of this Title, EU shall provide, on request and mutually agreed terms and conditions, technical and financial assistance in favour of ESA countries.

Article 68

Institutional Arrangements

1. For the purpose of this Title the ESA-EU Committee on IPRs shall be established.

2. The IPR Committee shall be composed of technical representatives of all Parties and shall report to the joint ESA-EU Committee on Trade Cooperation.

revised in Brussels June 2008 and awaits EC comments/addition into it

TITLE III

INVESTMENT AND PRIVATE SECTOR DEVELOPMENT SUPPORT

Article 69

Scope and Coverage

1. Cooperation shall, through financial and technical assistance, support the policies and strategies for investment and private sector development as set out in this Title. Cooperation shall be as provided in the Cotonou Partnership Agreements articles 74 to 78

Article 70

Objectives

1. The objectives of the cooperation on investment and private sector development are to:


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(a) Create an environment for sustainable and equitable economic development of ESA through investment, including FDI (green field or portfolio), technology transfer, capacity building and institutional support from the E.C.

(b) Facilitate better coordination between ESA and E.C on private sector development with specific regard to transparency in the economic space in ESA and poverty alleviation.

(c) Provide deeper cooperation with institutions and intermediary organisations dealing with investment promotion in E.C and ESA.

(d) Establish a framework for funding arrangements and assistance to support economic development programmes of ESA.

(e) Provide support to strengthen and build the capacity of private development institutions like the chambers of commerce associations and indigenous development organisations in individual ESA countries and the region as a whole so as to enable the emergence of dynamic and vibrant private sector (investment promotion agencies)

(f) Ensure constructive engagement between ESA and EU on continuous improvement of the investment climate in ESA through diagnostic reviews and assessments.

(g) establish mechanisms for providing information, identifying and disseminating investment rules, opportunities and other related information.

(h) develop a legal framework that favours investment in both Parties, by conclusion, where appropriate of agreements to promote and protect investment and avoid double taxation;

(i) work towards uniform intra-ESA harmonised and simplified procedures and administrative practices in the field on investment;

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(j) incorporate technical assistance activities for training initiatives between the Parties government agencies dealing with the matter; and

(k) .support through appropriate instruments, the promotion and encouragement of investment in ESA region

(l) Promote business dialogue, cooperation and partnership between EU and ESA

Article 71

Investment Climate

1. The parties undertake to take the necessary measures to create a conducive investment environment. In this regard they agree to the following:

(i) eliminate bottlenecks to investment and streamline investment procedures

(ii) establishing appropriate administrative structures to (one-stop shops) for the entry and setting up of investments so as to accelerate the establishment of business enterprises

Article 72

Investment promotion

The ESA countries and the E.U shall, subject to their general policy on investment, including Foreign Direct Investment, encourage the deepening of cooperation on inter-regional investment. On the EU side this will be through grant of incentives, preferences and privileges, special policies and measures which will increase the level of investment from the E.U into the ESA.

2. The aim of the co-operation is to promote, within the bounds of their own competence, an attractive and stable investment climate, which favours and promotes mutually beneficial investment, both domestic and foreign, especially through improved conditions for investment protection, investment promotion, the transfer of capital and the exchange of information on (incentives), opportunities and other relevant information.


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3. The ESA Countries and the EU, within the scope of their respective competencies, recognizing the importance of private investment in the promotion of their development cooperation and acknowledging the need to take steps to promote such investment, shall:

a) implement measures to encourage participation in their development efforts by private investors who comply with the objectives and priorities of ESA-EU development cooperation and with the appropriate laws and regulations of their respective States;

b) take measures and actions which help to create and maintain a predictable and secure investment climate as well as enter into negotiations on agreements which will improve such climate;

c) encourage the EU private sector to invest and to provide specific assistance to its counterparts in the ESA countries under mutual business cooperation and partnerships;

d) facilitate partnerships through joint ventures and encourage venture capital financing for greenfield investment and others, in line with ESA countries’ regulations ;

e) sponsor sectoral investment fora to promote partnerships and external investment;

f) support efforts of the ESA Countries to attract financing, with particular emphasis on private financing, for infrastructure investments and revenue generating infrastructure critical for the private sector;

g) support efforts of ESA countries to establish financial frameworks adapted to investment needs of SMEs and promotion of industrial linkages between TNCs and SMEs.

h) support capacity building for investment promotion agencies of ESA member countries and institutions involved in promoting and facilitating foreign and local investment;

i) disseminate information on investment opportunities and business operating conditions in the ESA Countries; and

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h) promote national and ESA-EU private sector business dialogue, cooperation and partnerships, in particular through an ESA-EU private sector business forum. Support for operations of an ESA-EU private sector business forum shall be the creation of a business council which has the following objectives:

(i) to facilitate dialogue within the ESA/EU private sector and between the ESA/EU private sector and the bodies established under the Agreement;

(ii) to analyse and periodically provide the relevant bodies with information on the whole range of issues concerning relations between the ESA and EU private sectors in the context of the Agreement or, more generally, of economic relations between the EU and the ESA countries; and

(iii) to analyse and provide the relevant bodies with information on specific problems of a sectoral nature relating to, inter alia, branches of production or types of products at national or regional level.

4. In order to encourage European investment in development projects of special importance, ESA Countries and the EU may also conclude agreements, to the extent consistent with the principles and objectives of this Agreement, relating to specific projects of mutual interest through public- private sector partnerships and joint venture arrangements.

Article 73

Investment Support

1. Cooperation shall be in the following areas;

(a) Capacity building and financial assistance to develop regulatory capacity

(b) Promotion of ESA as an investment destination

(C) Ensure access by ESA to resources available under EIB Investment Facility and CDE for the benefit of the region;

(d) Developing a programme to improve the overall financial environment of the ESA region in terms of:

(i) diversification of financial instruments,

(ii) encouraging strategic alliances including public-private partnerships, Build-Operate-Transfer and Build-Operate-Own activities between ESA and EU investors


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(a) Establishment of financial instruments adapted to SMEs(b) Support industry specific frameworks for emerging sectors(c) Establishment of risk insurance fund

Article 74

Investment finance

1. Cooperation shall provide long-term financial resources, including risk capital, to assist in promoting growth in the private sector and help to mobilise domestic and foreign capital for this purpose. To this end, the Community shall provide, in particular:

a) grants for financial and technical assistance to support policy reforms and advocacy, human resource development, institutional capacity-building or other forms of institutional support related to a specific investment, measures to increase the competitiveness of enterprises and to strengthen the capacities of the private financial and non-financial intermediaries, investment facilitation and promotion and competitiveness enhancement activities;

b) support towards (advisory and consultative services to assist in) creating a responsive investment climate and information base to guide and encourage the flow of capital.

c) The ESA and EU shall develop special instruments to development finance institutions for the setting up of dedicated investment funds for the exclusive purpose of providing development financing and assistance to investors in ESA.

d) Enhance access to the Investment Facility through:

(i) setting up EIB threshold for lending that takes into account development requirement realities of the ESA member States

(ii) the EIB should endeavour to facilitate the creation of guarantee and investment funds to ensure Investment Facility resources are availed to SMEs in ESA member States

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(iii) the EIB should carry out as much consultation as possible with ESA Member States in designing rules governing the operations of the investment facility lets regionalise EIB facilities – Amb Gunesse to provide wording

(iv) On exchange rate risks- try to use if appropriate Cotonou

(iv) the EU should introduce concessionary loans and incentives for EU companies ready to invest in the targeted sectors indentified by ESA countries

Article 75

Private Sector Development

1. The ESA and the E.U, in accordance with their laws and regulations shall set up a framework to strengthen private sector development in the ESA region through capacity building, mentoring, institutional commitment, transfer of technology and entrepreneurship development.

2. The Community shall provide the necessary financial and technical assistance for private sector and entrepreneurship development through a specific program elaborated for that purpose.

3. A business forum shall be established to provide a platform for the private sectors of both Parties to meet on a regular basis and in a structured manner with a view to developing business ties

Article 76

Investment guarantees


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1. Cooperation shall ensure the increasing availability and use of risk insurance as a risk-mitigating mechanism in order to boost investor confidence in the ESA Countries.

2. Cooperation shall offer guarantees and assist with guarantees funds covering risks for qualified investment. Specifically, cooperation shall provide support to ESA Countries for:

a) Reinsurance schemes to cover foreign direct investment by eligible investors; against legal uncertainties and major risks

b) Establishment of an appropriate legal framework for the guarantee of investments

c) Guarantee programmes to cover risk in the form of partial guarantees for debt financing. Both partial risk and partial credit guarantee shall be available; and

d) National and regional guarantee funds, involving, in particular, domestic financial institutions or investors for encouraging the development of the financial sector.

3. Cooperation shall also provide support to capacity-building, institutional support and participation in the core funding of national and/or regional initiatives to reduce the commercial risks for investors (inter alia guarantee funds, regulatory bodies, arbitration mechanisms and judiciary systems to enhance the protection of investments improving the export credit systems).

4. Cooperation shall provide such support on the basis of complementary and added value with respect to private and/or public initiatives and, whenever feasible, in partnership with private and other public organisations. The ESA and the EU shall undertake to establish ESA-EU Guarantee Agency to provide and manage investment guarantee programmes.

5 The Parties shall provide support to the ATI for the management of guarantee schemes and implementation of its programmes

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Article 77

Investment promotion and protection

1. The ESA Countries and the EU, within the scope of their respective competencies, affirm the need to promote and protect either Party’s investments on their respective territories, and in this context affirm the importance of concluding, in their mutual interest, investment promotion and protection agreements which could also provide the basis for insurance and guarantee schemes.

2. The Parties shall collaborate with a view to facilitate the conclusion of the avoidance of double taxation agreements within ESA and between ESA countries and the EU member states.

Article 78

Competent Authorities

1. The competent authorities of the EU and ESA countries shall be the competent authorities as defined in this Agreement. An EU/ESA Committee on trade related issues shall be established with the Sub-Committees mentioned in articles 65 to 67

2. Nothing in this Agreement shall be taken to restrict the mandate and operations of the Central Bank of an ESA country.


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As agreed in Addis June 2008

ESA PROPOSED TEXT ON GOVERNMENT PROCUREMENT

Article …..

Transparency in Government Procurement

The parties agree on the importance of transparency in government procurement. In pursuit of this, the parties shall take into account the development levels of the ESA States.

Article ….

Cooperation

1. The parties agree to cooperate with a view to the adoption, where appropriate, and the modernization of national procurement laws by the ESA States to enable them meet the objective set out in Article ….

2. In particular the EC party agrees to provide support to ESA States and region in the following areas:

(a) Enhancing human and institutional capacity;

(b) Exchange of experience and information about best practices and regulatory frameworks;

(c) Establishing appropriate contact points;

(d) Establishing and maintaining appropriate modern systems and mechanisms to implement this Chapter; and

(e) Establishing regional procurement systems including the creation of an on-line regional network for the effective dissemination of information on tendering opportunities, in order to promote regional trade.

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EC proposal incorporating ESA text June 2008

TITLE VIII

SUSTAINABLE DEVELOPMENT

MAIN BODY OF AGREEMENT

Article 1

Objectives

The objectives of this Agreement are:

a) Contributing to the reduction and eventual eradication of poverty and diseases through the

establishment of a trade partnership consistent with the objective of sustainable

development, the Millennium Development Goals and the Cotonou Agreement, and with promoting a stable and democratic political environment as well as regional integration.;

b) Promoting and expediting economic, cultural and social development, cooperation and good governance thus

establishing and implementing an effective, predictable and transparent regulatory

framework for trade and investment between the Parties and in the ESA

region, while preserving the environment;

c) Promoting the gradual integration of the ESA States into the world

economy, in accordance with their political choices and development priorities;

Article 2

Principles

1. This Agreement is based on the Fundamental Principles as well as the Essential and

Fundamental Elements of the Cotonou Agreement, as set out in Articles 2 and 9,

respectively, of the Cotonou Agreement. This Agreement shall build on the

provisions of the Cotonou Agreement and the previous ACP-EC Partnership


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Agreements in the area of regional cooperation and integration as well as economic

and trade cooperation.

2. The Parties agree that the Cotonou Agreement and this Agreement shall be

implemented in a complementary and mutually

reinforcing manner.

Article 3

Sustainable development

1. The Parties reaffirm that the objective of sustainable development is to be applied

and integrated at every level of their economic partnership, in fulfilment of the overarching commitments set out in Articles 1, 2 and 9 of the Cotonou Agreement,

and especially the general commitment to reducing and eventually eradicating

poverty in a way that is consistent with the objectives of sustainable development.

2. The Parties understand this objective to apply in the case of the present Economic

Partnership Agreement as a commitment that:

(a) the application of this Agreement shall fully take into account the human,

cultural, economic, social, health and environmental interests of their respective population and of future generations;

(b) The partnership shall be broad based to ensure ownership as well as political, economic, social and environmental sustainability. In this regard the EPA shall involve all stakeholders, including the private sector, civil society and parliamentarians, , in.

decision-taking methods that shall embrace the fundamental principles of

ownership, participation and dialogue. Dialogue shall play a pivotal role in the fulfilment of mutual obligations and cooperation relations between the Parties;

3. As a result the Parties agree to work cooperatively towards the realization of a

sustainable development centred on the human person, who is the main beneficiary

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of development.

SUSTAINABLE DEVELOPMENT CHAPTER(S)

Suggested version incorporating ESA text into EU text

Chapter A

ENVIRONMENT

Article 1

Objectives and sustainable development context

1. The Parties reaffirm that the principles of sustainable management of natural

resources and the environment are to be applied and integrated at every level of their partnership, as part of their overriding commitment to sustainable development as set out in Articles 1 and 2 of the Cotonou Agreement.

2. The Parties recall that Article 32 of the Cotonou Agreement includes environment and natural resources as thematic and cross-cutting issues, and that the fundamental principles of ownership, participation, dialogue and differentiation set out in Article 2 of the Cotonou Agreement are therefore particularly relevant.

3. The Parties and the Signatory ESA States are resolved to conserve, protect and improve the environment, including through effective implementation of the multilateral and regional environmental agreements to which they are parties. . They also commit to ratify, to the extent they have not yet done so, the amendments to these agreements.13

4. The Parties reaffirm their commitment to promoting the development of international

trade in such a way as to ensure sustainable and sound management of the environment, in accordance with their undertakings in this area including the

international conventions to which they are party and with due regard to their

respective level of development.

5. The Parties and the Signatory ESA States are resolved to make efforts to facilitate trade in goods and services which the Parties consider to be beneficial

13 These amendments include inter alia the Gaborone Amendment to CITES and the Ban amendment to the Basel Convention.


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to the environment. Such products may include environmental technologies, renewable and energy- efficient goods and services and eco-labelled goods.

Article 2

Levels of protection and right to regulate

1. Recognizing the right of the Parties and the Signatory ESA States to regulate in order to achieve their own level of domestic environmental and public

health protection and their own sustainable development priorities, and to adopt or

modify accordingly their environmental laws and policies, while respecting international commitments, each Party and Signatory ESA State shall seek to ensure that its own environmental and public

health laws and policies provide for and encourage high levels of environmental and public health protection and shall strive to continue to improve those laws and policies.

2. The Parties agree that the special needs, requirements, and different levels of development of the ESA

States shall be taken into account in the design and implementation of measures aimed at protecting environment and public health that affect trade between the Parties.

3. Provided that such measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination between the Parties or a disguised restriction on trade between them, nothing in this Agreement shall be construed to prevent any Party and the Signatory ESA States from adopting or maintaining measures necessary to protect human, animal or plant life or health, related to the conservation of natural resources or protection of the environment.

Article 3

Regional integration and use of international environmental standards

In the light of the environmental challenges facing their respective regions, and in order to

promote the development of international trade in such a way as to ensure sustainable and sound management of the environment, the Parties recognise the importance of establishing effective strategies and measures at the regional level. The Parties agree that in the absence of

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relevant environmental standards in national or regional legislation, they shall seek to adopt

and implement the relevant international standards, guidelines or recommendations, where practical and appropriate.

Article 4

Scientific information

The Parties recognise the importance, when preparing and implementing measures aimed at protecting the environment and public health that affect trade between the Parties, of taking

account of scientific and technical information, the precautionary principle, and relevant international standards, guidelines or recommendations.

Article 5

Transparency

The Parties and the Signatory ESA States commit to avoiding unnecessary obstacles to trade by developing, introducing and

implementing any measures aimed at protecting the environment and public health that affect trade between the Parties in a transparent manner, with due notice and public and mutual

consultation and with appropriate and timely communication to and consultation of non-state

actors including the private sector. The Parties agree that satisfying the provisions on

transparency included in the Chapter 6 and 7 of Title I shall be deemed to satisfy the provisions of this Article as well.

Article 6

Upholding levels of protection

1. Subject to Article 2 (1), and with the aim of creating a context for sustainable and equitable economic development of ESA, involving a sustainable industrialization process and transparency in the access to markets the Parties agree not to encourage trade or foreign direct investment to enhance or maintain a competitive advantage by:

(a) lowering the level of protection provided by domestic environmental and

public health legislation;


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(b) derogating from, or failing to apply such legislation.

2. The Parties and the Signatory ESA States commit to not adopting or applying regional or national trade or investment-related legislation or other related administrative measures as the case may be in a way which has the effect of

frustrating measures intended to benefit, protect or conserve the environment or natural resources or to protect public health.

Article 7

Consultation and monitoring process

1. The Parties recognise the importance of monitoring and assessing the impact of

implementation of the Agreement on sustainable development through their

respective participative processes and institutions, as well as those set up under this

Agreement.

2. The Parties may consult each other and the ESA -EC Consultative Committee on environmental issues covered by Articles 1 to 6. Members of the ESA -EC Consultative Committee may submit oral or written recommendations to the Parties for disseminating and sharing best practice relating

to issues covered by this Chapter.

3. On any issue covered by Articles 1 to 6 the Parties may agree to seek advice

from the relevant international bodies on best practice, the use of effective policy tools for addressing trade-related environmental challenges, and the identification of

any obstacles that may prevent the effective implementation of environmental standards under relevant Multilateral Environment Agreements.

4. A Party may request consultations with the other Party on matters concerning the interpretation and application of Articles 1 to 6. The consultations shall not

exceed three months. In the context of this procedure any Party may independently

seek advice from the relevant international bodies. In this case the limit for the period

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of consultations is extended by a further period of three months.

5. If the matter has not been satisfactorily resolved through consultations between the Parties pursuant to paragraph 3 any Party may request that a Committee of Experts be convened to examine such matter.

6. The Committee of Experts shall comprise three members with specific expertise in

the issues covered by this Chapter. The Chairperson shall not be a national of either Party. The Committee of Experts shall present to the Parties a report within three

month of its composition. The report shall be made available to the ESA EC

Consultative Committee.

7. The provisions set out in this article are without prejudice to relevant obligations in other international environmental and other agreements.

Article 8

Cooperation

1. The Parties recognize the importance of cooperating on environmental issues in order

to achieve the objectives of this Agreement.

2. Subject to the provisions of Article 7, the Parties agree to cooperate, including by

facilitating support in the following areas:

(a) Technical assistance to producers in meeting relevant product and other

standards applicable in markets of the EC Party;

(b) Promotion and facilitation of private and public voluntary and market-based

schemes including relevant labelling and accreditation schemes;


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(c) Technical assistance and capacity building, in particular to the public sector, in the implementation and enforcement of multilateral environmental agreements,

including with respect to trade-related aspects;

(d) Facilitation of trade between the Parties in natural resources, including timber

and wood products, from legal and sustainable sources;

(e) Assistance to producers to develop and/or improve production of goods and

services, which the Parties consider to be beneficial to the environment; and

(f) Promotion and facilitation of public awareness and education programmes in

respect of environmental goods and services in order to foster trade in such products

between the Parties.Agriculture as agreed in Brussels June 2008-06-26

PART VI

AGRICULTURE CHAPTER

DRAFT ESA Agricultural Text, June 16-19 2008 ESA Meeting in Addis Ababa, Ethiopia

Three guiding principles:

1. Interim EPA agreement has taken over some of the bracketed provisions;

2. Development Cooperation chapter could include provisions that are directly linked on

cooperation, finances, support etc.

3. Sustainable development chapter [to be negotiated] may include some of the texts on

sustainable agricultural development.

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Article 1: General Provisions

1. The Parties recognize the importance of agriculture in the ESA economies, as a main source of livelihood for the majority of the region’s population, a key contributing factor to ensuring poverty reduction and food and nutrition security, an important source of export revenue and as a sector with the potential of contributing to development and value-added activities.

2. In accordance with the provisions of Article xxx – [Development cooperation], and article xxx – [Sustainable development], the Parties agree to cooperate in promoting the sustainable growth of the agriculture sector, taking into account its multifunctional role the diversity of the economic, social and environmental characteristics and needs, and development strategies, of the ESA States.

3. The Parties recognize that the deeper integration of the agricultural sector across the ESA region, through removal of tariff and non-tariff barriers and the provision of an appropriate regulatory framework, will contribute to the expansion of the regional market, and will increase the scope for investment and private sector development.

4. Both Parties recognise the importance of supporting, through appropriate instruments, and adequate accompanying measures, promotion of value added functions in the food and agricultural production chains and emerging sectors, including the promotion of bio energy with due recognition of potential implications to food security, and the importance of responding to changing market conditions due to liberalisation, erosion of preferences, strict SPS, TBT conditions and consumer requirements. In this respect, all Parties aim to work together to attract such necessary investment, both domestic and foreign into the ESA region.

5. The parties agree to target expanding Aid for Trade allocations to support the objectives of agricultural development subject to the provisions in the Development Chapter. In this regard, both Parties recognize the need to ensure consistency and coherence between the larger framework of sustainable development and the national and regional objectives set under this Chapter.

Article 2: Objectives

1. The Parties agree that the fundamental objective of this Agreement is the sustainable development and the eradication of poverty in ESA States, and the smooth and gradual integration of these economies into the global economy.


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2. In the agricultural sector, this Agreement shall aim at contributing to competitiveness through delivery of support to initiatives that strengthen the key pillars of the ESA region’s agricultural sector, as determined by ESA states, particularly those that promote value added functions throughout the food and agricultural supply chains and ensure that the ESA region is able to supply quality products to meet the requirements of national, regional and international markets.

3. The Parties recognise that ensuring food and nutrition security, and enhancing livelihoods of rural communities are critical elements to eradicate poverty, and the pursuit of sustainable development. The Parties agree to cooperate to avoid disruption of markets for agricultural products in ESA States.

4. The Parties agree to address the challenges that are faced by Net Food Importing ESA States vulnerable to increases in world food market prices by assisting or supporting them to develop programmes to ensure food security.

5. The ESA Parties shall aim at moving gradually from specific commodity dependency to varied and competitive agro-based industrial development to cater for increased trade and to export to regional, international, including the EU markets.

6. The Parties shall aim at developing an efficient regional market for food and agricultural products, including through the implementation of regional agricultural policy.

Article 3: Principles

The cooperation in the agricultural sector will be guided by the following principles:

(1) Clear articulation of the ESA region’s priorities in agriculture with a view to ensuring that the EPA Agreement supports those priorities

(2) Recognition of the differences in the level of development and competitiveness between ESA and the EC and the need for necessary capacity building support to ESA agricultural sector

Article 4: Scope

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This Chapter shall cover regional integration, enabling policies, sustainable agricultural development, food security, market access conditions and specifically identify areas of cooperation and areas for exchange of information and consultation.

Article 5: Regional integration

The Parties recognize that the integration of the agricultural sector within ESA States, through the progressive removal of barriers and the provision of an appropriate regulatory framework, will contribute to the deepening of the regional integration process and thus contribute to the expansion of the regional market, which will increase the scope for investment and private sector development.

Article 6: Enabling policies

The Parties recognize the importance of adopting and implementing policies and institutional reforms to enable and facilitate the achievement of the objectives of this Chapter

Article 7: Sustainable agriculture development

1. The parties recognise the importance of cooperation in achieving sustainable agriculture development in light of the changing world production and trade patterns as well as consumer habits. The objective in this area is to ensure sustainable growth of the agricultural sector by adopting sustainable natural resource management practices

2. Subject to the provisions of Article XXX (Development Clause), the parties agree to cooperate in the following areas:

a) land and water management

b) capacity for markets and rural infrastructure development

c) development of a regional agricultural legal and regulatory framework

d) capacity building and institutional development

e) facilitate agricultural research and technology transfer, extension, training

f) access to finance and promotion of investments into the agricultural sector

g) strengthening of regional trade facilitation mechanisms

h) promote the emergence of value adding agro-processing industries

i) promote and strengthen processing, marketing, distribution and transport (PMDT)


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j) gender mainstreaming and access to production factors.

Article 8: Food security

1. The provisions of this Agreement shall aim at enabling ESA countries to implement effective measures to achieve food security and sustainable agricultural development, and to develop commercial agricultural markets in the region to address food insecurity.

2. The Parties acknowledge that the removal of barriers to trade between the Parties, as envisaged in this Agreement, may pose significant challenges to ESA producers and consumers in the agricultural sector and agree to consult with each other on these issues. To this end, the Parties will aim at addressing food insecurity, including enhancing nutritional aspects, at the national and regional level, and to aim at avoiding adopting measures that could endanger achievement of food security.

3. Where compliance with the provisions of this Agreement leads to problems with the availability of, or access to, foodstuffs or other products essential to ensure food security of a Party that Party may take appropriate measures in accordance with the procedures laid down in Article xxx – (safeguard provisions).

4. The objectives in this area are:

b) To enable ESA countries implement effective measures to achieve food security and sustainable agricultural development

c) To promote the development of agricultural production, of infrastructure on marketing and distribution of agricultural products in the region to address food security.

3. Subject to the provisions of Article XXX (development clause), the parties agree to cooperate, including by facilitating support, in the following areas:

a) Promotion of transfer of technology

b) coordination of food aid to give preference to sourcing food aid locally or regionally (triangular cooperation)

c) The production, supply, storage and distribution of foodstuffs;

d) Development of national, and regional market information systems

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e) [Ensuring that export refunds for countries that may need them among ESA States are made available

f) [Facilitating implementation of harmonised technical regulations and SPS standards and requirements – ] EC/ESA should check for consistence with text on SPS and TBT market access

g) Promote the development of disease free zones, and pest free areas

h) Promote the development of high yielding varieties through, inter alia, agricultural research.

i) [The development of critical factors of food production including water

j) Water management, including water harvesting and development of irrigation schemes

Article 9: Market access conditions

The EC Party shall take necessary measures to preserve the favourable Market access conditions for ESA exports. The EC party shall ensure that financial and other support will be provided to improve the competitiveness, production capacity and diversification of the agricultural sector of the ESA states.

Article 10: Net Food Importing Countries

1 The Parties recognise the importance of cooperation in addressing the concerns of ESA net food importing countries vulnerable to increases in world food market prices. The objective in this area is to assist or support the countries that are net food importers to develop programmes to ensure food security.

2 Subject to the provisions of Article XXX (Development Cooperation), the Parties agree to cooperate, including by facilitating support, in the following areas:

a) To address constraints for food production, marketing and trade in ESA region

b) To develop sustainable capacity for food production and food processing

c) Develop and implement a system or mechanism for enhancing regional trade in agricultural imports and food products

Article 11: Cooperation


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1. The Parties acknowledge the importance of the agricultural sector to the economies of

ESA States and agree to cooperate to promote the transformation of these sectors, with the aim of increasing their competitiveness, developing their capacity to access high quality markets and in view of their potential contribution to the sustainable development of the ESA States. They recognise the need to, and shall aim at, facilitating the adjustment of the agricultural and food sectors and the rural economy, to the progressive changes brought about by this Agreement, while paying particular attention to small scale operations, subject to the provisions of Article xxx –

[Development Cooperation].

2. Subject to the provision of Article [Development Cooperation] the Parties agree to cooperate, including by facilitating support, in the following areas:

(a) Development of regional agricultural legal and regulatory framework, building of the necessary capacity and support to institutional development;

(b) Improvement in the competitiveness of production, including downstream processing and promotion of value addition through innovation, training, promotion of linkages, including agricultural research, and other support interventions, in agricultural products covered by the Agreement;

(c) Development of regional and export marketing, including market research, both for trade between ESA States and between the Parties;

(d) Compliance with and adoption of quality standards relating to agricultural production and marketing, including standards relating to environmentally and socially sound agricultural practices and organic foods;

(e) Promotion of private investment and public-private partnerships as well as encouraging partnerships, linkages and joint ventures between economic operators in products covered by this Agreement.

(f) Promotion and strengthening of innovation, diversification and transfer of technology;

(g) Improvement in the ability of ESA operators to comply with national, regional and international technical, health and quality standards for agricultural products.

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Article 12: Exchange of information and consultation

1. The Parties agree to exchange experiences, information and best practices and to

consult on all issues related to the pursuit of the objectives of this Chapter and relevant to trade between the Parties.

2. The Parties agree that dialogue would be particularly useful in the following areas:

(a) Exchange of information on agriculture production, consumption and trade and on

the respective market developments for agricultural products;

(b) Promotion of investment in ESA agricultural and food sectors, including small-scale activities;

(c) Exchange of information on agricultural, rural development policies, laws and regulations;

(d) Discussion of policy and institutional changes needed to underpin the transformation of the agricultural sector as well as the formulation and implementation of regional policies on agriculture, food, and rural development in pursuit of regional integration;

(e) Exchange of views on new technologies as well as policies and measures related to

improvement of quality of ESA agricultural products

(f) Consultations and joint monitoring of progress made and results achieved in agricultural development in the ESA region

Taken from interim


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CHAPTER III

FISHERIES

TITLE I

GENERAL PROVISIONS

ARTICLE 25

1. The Parties recognise that fisheries constitute a key economic resource of the Eastern and Southern Africa (ESA) region, contribute significantly to the economies of the Signatory ESA States and have great potential for future regional economic development and poverty reduction. It is also an important source of food and foreign exchange.

2. The Parties further recognise that fisheries resources are also of considerable interest to both the EC Party and the Signatory ESA States, and agree to cooperate for the sustainable development and management of the fisheries sector in their mutual interests taking into account the economic, environmental and social impacts.

3. The Parties agree that the appropriate strategy to promote the economic growth of the fisheries sector and to enhance its contribution to the ESA economy , while taking into consideration its long term sustainability, is through increasing value adding activities within the sector.

ARTICLE 26

ObjectivesThe objectives of cooperation in fisheries are to:

(a) promote sustainable development and management of fisheries;(b) promote and develop regional and international trade based on best

practices;(c) create an enabling environment, including infrastructure and capacity

building, for the ESA States to cope with the stringent market requirements for both industrial and small scale fisheries;

(d) support national and regional policies aimed at increasing productivity and competitiveness of the fisheries sector;

(e) build links with other economic sectors.

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ARTICLE 27

ScopeThe cooperation in fisheries trade and development shall cover marine, inland fisheries and aquaculture.

ARTICLE 28

Principles

1. The principles of cooperation in fisheries include:

a. support for the development and strengthening of regional integration,b. preservation of the acquis of the Cotonou Agreement;c. provision of special and differential treatment; d. the need to take the into account the best available scientific

information for the resource assessment and management; e. functioning monitoring system of the environmental, economic and

social impacts in Partner Countries;f. conformity with existing national laws and relevant international

instruments including UNCLOS, regional and sub-regional agreements; and

g. preservation and priority of particular needs of the artisanal/subsistence fishery.

2. These guiding principles should contribute to sustainable and responsible development of the living inland and marine resources, aquaculture, and to optimising the benefits of this sector for present and future generations, through increased investment, capacity building and improved market access.

ARTICLE 29

Preferential access

The Parties shall cooperate to ensure that financial and other support will be provided to improve the competitiveness and production capacity of the processing factories, the diversification of the fishing industry and improvement of port facilities.


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TITLE II

MARINE FISHERIES

ARTICLE 30

Scope

The scope of this title is the utilisation, conservation and management of marine fisheries resources to optimise the benefits from fisheries for the ESA region through investment capacity building and improved market access.

ARTICLE 31

Objectives1. The objectives of cooperation are to:

a) Strengthen cooperation in order to ensure the sustainable exploitation and management of fisheries resources as a strong basis for regional integration, given the straddling and migratory species which are shared among island and coastal States and as, no individual ESA State has the capacity to ensure sustainability of the resource;

b) Ensure a more equitable share of the benefits derived from the fisheries sector;

c) Ensure effective monitoring control and surveillance (MCS) necessary for combating illegal, unreported & unregulated (IUU) fishing; and

d) Promote effective exploitation, conservation and management of the living marine resource in the EEZ and waters in which ESA States have jurisdiction based on international instruments, including UNCLOS, for the mutual social and economic benefit of the ESA States and the EC Party.

ARTICLE 32

Areas of cooperation

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1. To achieve the objectives of cooperation in fisheries within the described principles, cooperation will include fisheries management and conservation issues, vessel management and post harvest arrangements and financial and trade measures and development of fisheries and fisheries products and marine aquaculture.

2. The EC Party will contribute to the mobilisation of the resources for the implementation of the identified areas of cooperation at national and regional levels, which will also include support for regional capacity building. Furthermore, the EC Party shall contribute to the measures as described in the section concerning financial and trade measures, and on infrastructure development specific for fisheries and marine aquaculture.

a) Fisheries Management and Conservation Issues

1. The precautionary approach shall be applied in determining levels of sustainable catch, fishing capacity and other management strategies to avoid or reverse undesirable outcomes such as over-capacity and over-fishing, as well as undesirable impacts on the ecosystems and artisanal fisheries.

2. Each ESA State may take appropriate measures, including seasonal and gear restrictions in order to further protect its territorial waters and ensure the sustainability of the artisanal and coastal fishery.

3. The Parties would promote the membership of all the concerned States to IOTC and other relevant fisheries organisations. These countries, with the EC Party, should co-ordinate action to ensure the management and conservation of all fish species, including tuna and tuna-like resources and facilitate relevant scientific research.

4. Where there is insufficient scientific evidence for the competent national management authority to determine limits and target levels of sustainable catch in an ESA EEZ, both parties in consultation with the competent national authority and together with IOTC and where relevant, other regional fisheries organisations, shall support such scientific analysis.

5. The parties agree to take appropriate measures where an increase in effort results in catch levels above the target sustainable level established by the competent national authority.

6. In order to conserve and manage straddling stocks and highly migratory fish stocks, the EC Party and the ESA coastal and island States shall ensure compliance by vessels flying their flags with relevant national, regional and sub- regional fisheries management measures and related national laws and regulations.

b) Vessel Management and Post Harvest Arrangements


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1 Vessels Management and post harvest arrangements emerging from IOTC and any other relevant regional fisheries organisations will be observed. ESA states and the EC Party shall set out minimum terms and conditions with respect to monitoring, control and surveillance of EC Party fishing vessels operating in the waters of ESA States, which should include the following:

2 A Vessel Monitoring System (VMS) will be set up for all ESA coastal and island States, and all ESA states will use a compatible VMS. Those ESA states which do not have a VMS will be assisted by the EC Party to set up a compatible VMS.

3. In addition to a compulsory compatible VMS system, all ESA coastal and island states, in conjunction with the EC Party, will develop other mechanisms to ensure effective Monitoring, Control and Surveillance (MCS) and the EC Party will support ESA states to put such an agreed system in place and assist in implementation.

4. Countries shall have the right of placing observers, whether in national or international waters, with the procedures concerning the deployment of observers being well stipulated. Observers are to be paid by the national governments but all costs on board are to be met by the ship-owner. The EC Party will support the costs of training observers.

5. Common systems of reporting of fishing will be developed and be used throughout the region, with minimum terms set for reporting.

6. All vessels that land or tranship their catches within the ESA Coastal or Island State shall do it in ports or outer-port areas. No transhipment shall be allowed at sea, except on particular condition foreseen by the relevant RFMO under special conditions. Both parties shall cooperate to modernise landing or transhipment infrastructure in ports of ESA countries, including development capacity of fish products.

7. All vessels should endeavour to use the facilities of the ESA countries and undertake to make use of local supplies.

8. Discards reporting shall be compulsory. Priority should be given to avoid discards through the use of selective fishing methods in line with principles of IOTC and relevant regional fisheries organisations. As far as possible, by-catch shall be brought ashore.

9. The Parties agree to cooperate in developing and implementing national/regional training programmes for ESA nationals in order to facilitate their effective participation in the fishing industry. Where the EC Party has negotiated bilateral fisheries agreements, employment of ACP nationals shall be encouraged. The ILO declaration on fundamental principles and rights at work shall apply as of right to seamen signed on Community vessels.

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10. Both Parties shall undertake coordinated efforts to improve the means for preventing, deterring, and eliminating IUU fishing and to this end take appropriate measures. Fishing vessels involved in IUU fishing should be prosecuted and should not be allowed to fish again in ESA waters, unless prior authorisation has been obtained from both the flag State and the concerned ESA States as well as, where relevant, the concerned RFMO.

c) Financial and Trade Measures and Development issues

The Parties undertake to cooperate in promoting the setting up of joint ventures in fishing operations, fish processing, port services, enhance production capacity, improve competitiveness of fishing and related industries and services, downstream processing, development and improvement of port facilities, diversification of the fishery to include non-tuna species which are under-exploited or not exploited.

TITLE III

INLAND FISHERIES AND AQUACULTURE DEVELOPMENT

ARTICLE 33

Scope

The scope of this title shall cover inland fisheries, coastal and aquaculture development in the ESA region with respect to capacity building, technology transfer, Sanitary and Phytosanitary (SPS) standards, investment, and investment finance, environmental protection as well as legal and regulatory frameworks.

ARTICLE 34

Objectives

The objectives of cooperation in inland fisheries and aquaculture development will be to promote sustainable exploitation of inland fisheries resources, and enhance aquaculture production, remove supply side constraints, improve fish and fish products quality to meet SPS standards in EC Party market, improve access to the EC Party market, address intra regional trade barriers, attract capital inflows and investment into the sector, build capacity and enhance access to financial support for the private investors for inland fisheries and aquaculture development


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ARTICLE 35


The areas of cooperation shall include the EC Party contributions to the following:

a) Capacity building and export market development through:i. Building capacity in industrial and artisanal production,

processing and product diversification that strengthen the competitiveness of the region’s inland fisheries and aquaculture and aquaculture. This could, for example, be achieved by the creation of R&D centres including the development of aquaculture for commercial fishing farms;

ii. Build capacity for managing export market chains, including the introduction and management of certification schemes for specific product lines; and implementation of market promotion, value addition and reduction in post harvest losses in fisheries products;

iii. Increase capacity in the region through for example improving competent authorities, traders associations and fishers in order to participate in fisheries trade with the EC Party and training programs in product development and branding.

b) Infrastructure

i. Development and improvement of infrastructure for inland fisheries and aquaculture;

ii. Facilitation of access to funding for infrastructure, including all types of equipment.

c) Technology

i. Both Parties shall contribute to the development of technical capabilities, including value adding technology promotion, for example through fisheries technology transfer from the EC Party to the ESA countries;

ii. Fisheries management capacity in the region to be enhanced, for example through research and data collection systems and contribution towards appropriate technologies on harvesting and post harvest management.

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d) Legal and regulatory

i. Support towards development of inland fisheries and aquaculture regulations and monitoring control and surveillance systems

ii. Support to ESA in developing appropriate legal and regulatory instruments on IPR and build capacity for their implementation in international trade.

iii. Eco-labelling and intellectual property protection

e) Investment and finance

i. Promotion of joint ventures and other forms of mixed investments between stakeholders in ESA countries and the EC Party, for example for the setting up of modalities for identifying investors for joint venture operations in inland fisheries and aquaculture;

ii. Contribute to providing access to credit facilities for the development of small to medium scale enterprises as well as industrial scale inland fisheries

f) Environmental and Stocks Conservation in Fisheries

i. Both parties shall contribute to measures to ensure that fish trade supports environmental conservation and safeguards against stocks depletion, and to the maintenance of biodiversity and the cautious introduction of exotic species for aquaculture (to be introduced only in managed/closed spaces in consultation with all concerned neighbouring countries).

g) Socioeconomic and poverty alleviation measures

i. The parties shall contribute to the promotion of small and medium scale fishers, processors, and fish traders by building the capacity of ESA States to participate in trade with the EC Party.

ii. Participation of marginal groups in the fishing industry will be encouraged for example through the promotion of gender equity in fisheries by developing capacity of women engaged in fisheries, as well as other disadvantaged groups with the potential to engage in fisheries for sustainable social economic development.


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Taken from interim agreement

CHAPTER IV

ECONOMIC AND DEVELOPMENT COOPERATIONTITLE I

GENERAL PROVISIONS

ARTICLE 36

General provisions

1. The Parties agree to address the developmental needs of the ESA States in order to promote sustained growth in the ESA region, increase production and supply capacity of the States concerned foster structural transformation and competitiveness of their economies and their diversification and value addition; and support regional integration.

2. The Parties commit themselves to cooperating in order to facilitate the implementation of this Agreement and to support regional integration and development strategies. The Parties agree that cooperation will be based on the ESA Development Cooperation Strategy and the jointly agreed Development Matrix. The matrix is attached as Annex IV to this Agreement. The strategy and matrix will be regularly reviewed subject to the provisions of Chapter VI on dispute avoidance, settlement, Institutional and Final provisions. This cooperation will be measured against jointly agreed development benchmarks to be developed and adopted and annexed to this Agreement. The cooperation shall be in form of financial and non financial support to the ESA region.

3. In this regard, the financing pertaining to development co-operation between the ESA Region and the EC Party for the implementation of this Agreement shall be carried out within the framework of the rules and relevant procedures provided for by the Cotonou Agreement in particular the programming procedures of the EDF within successive financial frameworks of the EU during the period of this Agreement as well as within the frameworks of relevant instruments financed by the General Budget of the European Union. In this context, taking into account the new challenges deriving from enhanced regional integration and competition on the global markets, the Parties agree that supporting the implementation of the EPA shall be one of the priorities.

4. Both Parties shall cooperate to mobilize resources additional to the financial framework of the EU, from EU Member States and other donors, in particular expanding Aid for Trade commitments, relating specifically to EPA support requirements and adjustment costs. The programmes/projects proposed for

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financing will be worked out jointly based on a detailed costed development matrix.

5. Sufficient resources should be mobilised on a predictable, timely and sustainable basis including through grants and concessional loans based on the development matrix. The European Community shall contribute to these efforts under its international commitment on the scaling up of Official Development Aid. The Parties agree to monitor and coordinate the use of these resources.

6. Consistent with the Paris Declaration on Aid Effectiveness, the Parties agree to use and support as appropriate nationally and/or regionally owned delivery mechanisms, funds or facilities for channelling and coordinating resources for implementing the EPA. The Parties shall, in that regard, support the establishment of an EPA Fund to channel EPA related resources. The Parties also agree that all forms of aid delivery pertaining to their cooperation under this Agreement shall be guided by the Paris Declaration on aid effectiveness.

7. The trade-related issues to be provided for in the comprehensive EPA shall be the subject of development co-operation in accordance with this Article taking into consideration the Paris Declaration on Aid effectiveness.

9. The Parties agree that EPA monitoring, on the basis of agreed indicators, will need to address all aspects of the EPA, including achievements of the national level and at the level of regional integration and development strategies, as well as the effectiveness of the institutional arrangements and their achievements in meeting Aid effectiveness objectives, including ensuring predictability of the resources

10. The Parties agree that, without prejudice to the provisions of Art 95.4 of the Cotonou Partnership Agreement, the review process provided therein will constitute an opportunity for the Parties to review the achievements, constraints and way forward regarding their development cooperation strategies as provided for within the Agreement

ARTICLE 37

Objectives1. The economic and development co-operation shall aim at enhancing the competitiveness of ESA economies, building up supply capacity and enabling Signatory ESA States in implementing the EPA smoothly.

2. The economic and development co-operation shall aim at the structural transformation of ESA economies by establishing a strong, competitive and diversified economic base in the ESA States through enhancing production, distribution, transport, marketing; developing trade capacity of ESA States as well as capacity to attract investment; and strengthening the Signatory ESA


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States' trade and investment policies and regulations and deepening regional integration.

ARTICLE 38

Scope1. The Parties shall set out the development objectives related to the EPA that are specific to the ESA region and needed for the success of regional integration within the areas and sectors highlighted in this Article.

2. The areas that will be addressed by the cooperation are:

a) Regional cooperation and integration to ensure trans-regional coordination in all sectors;

b) Trade policy and regulations in order to assist the ESA States in participating more effectively in trade negotiations, in implementing international trade related conventions, and trade related legislations and regulatory reforms amongst others;

c) Trade development which covers namely business development and activities aimed at improving information management systems; partnerships, linkages, joint ventures and exchange of information and experiences; access to credit and investment finance; trade promotion and market development; Institutional support as well support to trade in services, including financial services;

d) Trade related infrastructure including transport, energy and water;

e) Building productive capacities in relevant sectors of ESA economies;

f) Research and development, innovation and technology transfer ;

g) Trade related adjustment costs which include restructuring and social costs arising from the reduction of production by firms in import competing sectors and the loss of fiscal revenues dues to the tariff reductions;

h) Gender mainstreaming;

i) Empowerment of local communities which includes social and cultural Development; and

j) Mainstreaming of environmental issues into trade and development.

3. The cooperation shall, in particular, cover the following sectors:

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a) Private Sector Development, particularly Industrial Development, Micro-enterprises, Small and Medium Sized Enterprises; Mining and Minerals and Tourism;

b) Infrastructure Development, namely in the Transport, Energy and Information and Communications Technology (ICT) sectors;

c) Natural Resources and Environment including Water Resources, Biodiversity and Environment;

d) Agriculture;

e) Fisheries;

f) Services including Tourism; and

g) Trade related issues, namely Investment, Competition, Intellectual Property Rights, Standards, Trade Facilitation and Statistics.

TITLE II

PRIVATE SECTOR DEVELOPMENT

ARTICLE 39

Scope and Objectives1. The Parties recognise the importance of cooperation to develop the ESA region’s private sector as the main engine of wealth creation in view to set up an appropriate enabling environment which is conducive to investment and growth. The Community support and cooperation shall take account of the economic structure of the ESA States and their priorities in strengthening productive capacities and value addition, and the application of Production, Marketing, Distribution, and Transportation (PMDT) functions to improve supply capacities and competitiveness.

2. The scope of cooperation of private sector development will cover, inter-alia, investment, industrial development and competitiveness enhancement, micro-enterprises, small and medium sized enterprises development, mining and minerals and tourism development as well as other productive sectors which are directly and indirectly covered by this Agreement.

ARTICLE 40

Investment


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1. The Parties recognise the importance of investment. The objectives in this area are to:

a) Create an environment for sustainable and equitable economic development of ESA through investment, including Foreign Direct Investment (green field or portfolio), technology transfer, capacity building and institutional support from the EC Party;

b) Provide deeper cooperation with institutions and intermediary organisations dealing with investment promotion in the EC Party, including the CDE and ESA through, inter alia, business dialogue, cooperation and partnership;

c) Support through appropriate instruments, the promotion and encouragement of investment in the ESA region including establishing a framework for funding and assistance to support economic development programmes in ESA;

d) Strengthen and build the capacity of private development institutions such as investment promotion agencies, chambers of commerce, associations and indigenous development organisations in individual ESA States and the region as a whole so as to enable the emergence of dynamic and vibrant private sector; and

e) Develop a legal interim framework that promotes investment by both Parties, with a view to promoting and protecting investment and work towards harmonised and simplified procedures and administrative practices.

Areas of cooperation2. Subject to the provisions of Article 36 the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Support to policies and strategies for investment to help to create and maintain a predictable and secure investment climate;

b) Support policy reforms and advocacy, human resource development, institutional capacity-building or other forms of institutional support to strengthen the capacities of the private financial and non-financial intermediaries, investment facilitation and promotion and competitiveness enhancement activities;

c) Encourage the EU-ESA private sector partnership and joint ventures to promote investment, venture capital financing for greenfield investment and technology transfer;

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d) Support efforts of the ESA States to attract financing, with particular emphasis on private financing, for infrastructure investments and revenue generating infrastructure critical for the private sector, including SMEs;

e) Support to develop regulatory capacity;

f) Improve access of ESA enterprises investment finance instruments in the EU such as the EIB;

g) Establishment of financial instruments adapted to SMEs of the ESA region;

h) Ensure the increasing availability and use of risk insurance as a risk-mitigating mechanism in order to boost investor confidence in the ESA States; and

i) Offer guarantees and assist with guarantee funds covering risks for qualified investment.

ARTICLE 41

Industrial development and competitiveness1. The Parties recognise the importance of cooperation in industrial development and competitiveness. The objectives in this area are:

a) To facilitate the establishment, development, restructuring and modernisation of the Signatory ESA States' industry while fostering its competitiveness and self-sustainable and balanced growth taking into account environmental protection, sustainable development and economic empowerment; and

b) To establish an environment favourable to the development of private enterprise in order to stimulate the growth and diversification of industrial production.

Areas of Cooperation2. Subject to the provisions of Article 36, the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Promote the development of activities in the areas of processing, marketing, distribution and transportation of products;

b) Transfer of technology, knowledge and research and development;


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c) Support ESA States financial institutions and the development of capital market for the purpose of enhancing the private sectors’ access to both short term and long term capital;

d) Capacity building for public and private sector;

e) Encourage EU-ESA partnerships, linkages and joint ventures between economic operators; and

f) Promote and strengthen innovation, diversification and value addition product development and quality.

ARTICLE 42

Micro-Enterprises, Small and Medium Sized Enterprises

1. The Parties recognise the importance of cooperation in Micro-Enterprises, Small and Medium Sized Enterprises. The objectives in this area are to:

a) Promote a favourable environment for the development of micro enterprises, small and medium sized enterprises (MSMEs) and for attracting investment therein; and

b) Support MSME to adjust to trade liberalisation.

Areas of Cooperation2. Subject to the provisions of Article 36, the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Capacity building and institutional support,

b) Technology development and transfer, innovation, information exchange and networks, and marketing;

c) Development of MSME databases

d) Access to finance;

e) Encourage EU-ESA partnerships, linkages and joint ventures between economic operators;

f) Trade and investment promotion;

g) Strengthen value chains;

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h) Promote diversification and value addition.

ARTICLE 43

Mining and Minerals1. The Parties recognise the importance of cooperation in the development and management of the mining and minerals sector. The objectives in this area are to:

a) Establish a conducive environment for attracting investment in the sector;

b) Promote value addition and environmentally friendly technologies in the mining productive processes; and

c) Ensure participation of local communities.


2. Subject to the provisions of Article 36, the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Capacity building and institutional support for exploration, exploitation and marketing of minerals;

b) Information exchange;

c) Encourage EU-ESA partnerships, linkages and joint ventures between economic operators;

d) Improve health and safety standards in the mining industry;

e) Transfer of technology, knowledge, innovation and Research and Development; and

f) Address vulnerability of mineral export dependency.


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ARTICLE 44

Tourism Development1. The Parties recognise the importance of cooperation in the development of tourism. The objectives in this area are to:

a) Develop and strengthen a competitive tourism industry as a generator of economic growth and empowerment, employment and foreign exchange;

b) Strengthen the linkages between tourism and other sectors of the economy; and

c) Preservation, safeguarding and promotion of natural, historical and cultural tourist attractions, while respecting the integrity and interests of local communities, particularly in rural areas.

Areas of cooperation2. Subject to the provisions of Article 36 the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Establish strategic alliances involving public, private and local community interests in order to ensure the sustainable development of tourism;

b) Promote partnerships, exchange of know-how and joint operations in areas such as development of products, markets and eco-tourism;

c) Capacity building in human resources, improvement in service standards, and institutional structures; and

d) Regional cooperation in tourism promotion.

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TITLE III

INFRASTRUCTURE

ARTICLE 45

Scope and Objectives

1. The Parties recognise the importance of cooperation in the development and management of infrastructure, as a means to overcome the supply-side constraints and strengthen regional integration.

2. The Community support and cooperation for infrastructural development shall take account of priority development areas as articulated in the respective ESA States’ national and regional development programmes.

3. The scope of Cooperation in infrastructure will cover the development of physical infrastructure namely, transport, energy and information technology and communication.

ARTICLE 46

Transport

1. The Parties recognise the importance of cooperation in the development and management of transport. The objectives in this area are to:

a) Develop, restructure, rehabilitate upgrade and modernise the ESA region’s transport systems, on a sustainable basis;

b) Improve the movement of people and flow of goods and provide better access to markets through road, air, maritime, inland water and rail transport.


2. Subject to the provisions of Article 36, the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Improve management of transport systems;


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b) Improve and develop the state of infrastructure at all levels, including the development of inter-modal infrastructure networks;

c) Capacity building in human resources, improvement in service standards, and institutional structures;

d) Technology development and transfer, innovation, information exchange and networks, and marketing;

e) Encourage EU-ESA partnerships, linkages and joint ventures between economic operators;

f) Improve safety and reliability of the transport sector, including the management of hazardous goods and emergency response; and

g) Support to the development of regional transport policies.

ARTICLE 47

Energy 1. The Parties recognise the importance of cooperation in the energy sector as a vehicle for supporting the ESA economies competitiveness at the regional and global level. The objectives in this area are to:

a) Improve the access of ESA States to modern, efficient, reliable, diversified and sustainable and renewable sources of clean energy at competitive prices;

b) Enhance the production, distribution and management capacity of energy nationally and regionally; and

c) Promote regional energy cooperation.

Areas of cooperation2. Subject to the provisions of Article 36, the Parties agree to cooperate, including by facilitating support, in the following areas:

a) Enhance the production and distribution capacity of existing energy sources, in particular hydro, petroleum and biomass;

b) Expand and diversify the energy mix to include other potential sources of energy, that are socially and environmentally acceptable and that reduce dependency on oil;

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c) Support the development of energy infrastructure, including for rural areas;

d) Support the development of appropriate energy regulatory and policy reforms, including commercialisation and privatisation;

e) Promote regional interconnectivity and cooperation in the production and distribution of energy;

f) Capacity building in human resources, improvement in management, service standards, and institutional structures;

g) Support the creation of a conducive environment for attracting investment in the sector;

h) Technology development and transfer, Research and Development, innovation, information exchange, development of databases and networks;

i) Encourage EU-ESA partnerships, linkages and joint ventures between economic operators.

ARTICLE 48

Information and communications technology1. The Parties recognise the importance of cooperation in the development of Information and Communications Technology, as a key sector in the modern society to foster competitiveness and innovation, as well as for the smooth transition towards the information society. The objective in this area is to develop the ICT sector and promote its contribution to other socio-economic sectors.


a) Facilitate connectivity at the national, regional and global level

b) Dissemination of new information and communication technologies

c) Support the development of the legal and regulatory frameworks on ICT;

d) Technology development, transfer and applications, R&D, innovation, information exchange and networks, and marketing

e) Capacity building in human resources, improvement in service standards, and institutional structures


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f) Encourage and facilitate EU-ESA partnerships, linkages and joint ventures between economic operators

g) Promotion and support for the development of niche markets for ICT-enabled services.

TITLE IV

NATURAL RESOURCES AND ENVIRONMENT

ARTICLE 49

Scope and objectives1. The Parties recognise the importance of cooperation in the sustainable management of natural resources and environment. Cooperation in this area shall take account of differentiated and trans-boundary needs of ESA States.

2. The scope of Cooperation in natural resources and environment will cover natural assets including water resources, and environment including biodiversity, as well as enhancing the linkages between trade and environment. It will also cover support for the implementation of international environmental agreements and Conventions and Treaties.

ARTICLE 50

Water resources1. The Parties recognise the importance of cooperation in the development of water resources (including irrigation, hydropower and water supply) for the improvement of the livelihoods of the populations. The objectives in this area are:

a) The sustainable development and management of water resources in the region;

b) Regional cooperation for the sustainable utilisation of trans-boundary water resources.


a) Development of infrastructure of water resources in the region;

b) Support the development of the legal and regulatory frameworks;

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c) Promote integrated water management;

d) Capacity building in human resources, improvement in service standards, water management, and institutional structures;

e) Encourage and facilitate EU-ESA partnerships, linkages, regional water partnerships, and joint ventures between economic operators;

f) Technology development, transfer and applications, R&D, innovation, information exchange and networks;

g) Water pollution control, purification and conservation, wastewater treatment and sanitation; and

h) Promotion of sustainable irrigation schemes.

ARTICLE 51

Environment1. The Parties recognise the importance of cooperation in the protection and sustainable management of the Environment and implementation of trade-related environmental policies. The objectives in this area are to:

a) Protect, restore and conserve the environment and biodiversity: flora, fauna and microbial genetic resources including their ecosystems;

b) Develop new ESA industries related to the environment; and

c) Reduce environmental degradation, including clean air and desertification.


a) Support the implementation of international environmental agreements, Conventions and Treaties;

b) Strengthen and promote sustainable environmental management systems;

c) Sustainable utilisation of biodiversity, forestry and wildlife resources;

d) Reinforcing institutional and legal frameworks and the capacity to develop, implement, administer and enforce environmental laws, regulations and standards and policies;


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e) Capacity building in human resources and institutional structures to comply with environmental and biodiversity requirements;

f) Encourage and facilitate EU-ESA partnerships, linkages, and joint ventures between economic operators;

g) Mitigation of natural disasters, prevention of environmental disasters and the loss of biodiversity;

h) Technology development and adaptation, transfer and applications, R&D, and innovation;

i) Protection and management of coastal and marine resources and domestic and wild indigenous biological resources;

j) Support the development of alternative environmentally friendly activities and livelihoods;

k) Support the production and facilitate trade of goods and services for which eco-labelling is important;

l) Exchange of information and networking on products and their requirements in terms of production process, transport, marketing and labelling;

m) Support the development of infrastructure facilities on environmental friendly products;

n) Integration of local communities in the management of biodiversity, forestry, and wildlife resources;

o) Waste management and disposal of industrial and toxic wastes; and

p) Sustainable management of forests and similar mechanisms.

ARTICLE 52

Financial undertakings1. The EC Party shall put at the disposal of the ESA financial assistance to contribute to implement the programmes and projects to be developed under the areas of cooperation identified in this Agreement and relevant chapters and under the detailed Development Matrix.

2. The Parties agree to establish adequate joint institutional arrangements to effectively monitor the implementation of the development cooperation of this

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Agreement. Such arrangements shall include the establishment of a joint development committee.

3. The Parties agree that the institutional arrangements shall remain flexible to adapt to the evolving national and regional needs


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Text after negotiating session –certain comments – as amended 21 June 2008

[All references to joint EPA implementation bodies are purely indicative, depending on the institutional arrangements agreed. ]

DISPUTE AVOIDANCE AND SETTLEMENT

CHAPTER I

OBJECTIVE AND SCOPE

Article 1

Objective

The objective of this Title is to settle disputes between the Parties concerning [the good faith] application of this Agreement and to arrive to a mutually satisfactory resolution of any matter that might affect its operation [taking account of the development objectives of this Agreement].

Article 2

Scope

1. This Part shall apply to any dispute concerning the interpretation and application of this Agreement, [except as otherwise expressly provided for in this Agreement].

2. [Notwithstanding paragraph 1, the procedure set out in Article 98 of the Cotonou Agreement shall be applicable in the event of a dispute concerning development finance cooperation as provided for by the Cotonou Agreement.]-[provision to be revisited in the light of evolution of provisions on development co-operation – and reference to Article 30 of Annex IV of the CPA ???]

Article 3[Choice of forum and] Relation with WTO obligations and other bilateral

obligations

1. Arbitration bodies set up under this Agreement shall not adjudicate disputes on each Party or Signatory ESA States' rights and obligations under the Agreement establishing the World Trade Organisation (WTO).

2. Recourse to the dispute settlement provisions of this Agreement shall be without prejudice to any action in the WTO framework, including dispute settlement action. However, where a Party or Signatory ESA State has, with

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regard to a particular measure14 [or situation ????], instituted a dispute settlement proceeding, either under Article 6(1) of this Agreement or under the WTO Agreement, it may not institute a dispute settlement proceeding regarding the same measure [or situation] in the other forum until the first proceeding has ended. For purposes of this paragraph, dispute settlement proceedings under the WTO Agreement are deemed to be initiated by a Party or Signatory ESA States' request for the establishment of a panel under Article 6 of the Understanding on Rules and Procedures Governing the Settlement of Disputes of the WTO.

3. Nothing in this Agreement shall preclude a Party or Signatory ESA State from implementing the suspension of obligations authorised by the Dispute Settlement Body of the WTO. Nothing in the WTO Agreement shall preclude Parties from suspending benefits under this Agreement.

4. The This Dispute Avoidance and Settlement provisions of this Chapter shall not apply to any bilateral agreements between the individual EU States and Signatory ESA States. [new] [see the corresponding position on CARIFORUM investment] [ESA to respond after]

[ESA to provide provision on choice of forum][parties to consider whether it is necessary to make explicit that an omission is also covered – ref to ESA term “situation”] [parties to further consider relevance of “choice of forum” term]

CHAPTER II

CONSULTATIONS AND MEDIATION

Article 4

Consultations

1. The Parties shall endeavour to resolve any dispute referred to in Article 2 by entering into consultations in good faith with the aim of reaching a mutually agreed solution.

2. A Party shall seek consultations by means of a written request to the other Party, copied to the Joint EPA Implementation Committee [according to the institutional arrangements we will define], identifying the [situation or] measure at issue and the provisions of the Agreement that it considers the measure not to be in conformity with.

3. Consultations shall be held within 30 days of the date of the submission of the request. The consultations shall be deemed concluded within [60] days of the date of the submission of the request, unless both Parties agree to continue

14 "for the avoidance of doubt a measure may include a failure to act" joint declaration _____ exact place to be agreed latter.


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consultations. All information disclosed during the consultations shall remain confidential.

4. Consultations on matters of urgency, including those regarding perishable or seasonal goods shall be held within 15 days of the date of the submission of the request, and shall be deemed concluded within 30 days of the date of the submission of the request. The parties agree that Every effort shall be made to ensure that such consultations are held addressed as soon as possible to avoid losses especially in the case of goods from ESA states. [second sentence NEW]

5. If consultations are not held within the timeframes laid down in paragraph 3 or in paragraph 4 respectively, or if consultations have been concluded and no agreement has been reached on a mutually agreed solution, the complaining Party may request the establishment of an arbitration panel in accordance with Article 6 or propose mediation of the matter in accordance with Article 5.-

Article 5

Mediation

1. If consultations fail to produce a mutually agreed solution, the Parties may, by agreement, seek recourse to a mediator. Unless the Parties agree otherwise, the terms of reference for the mediation shall be the matter referred to in the request for consultations.

2. Unless the Parties agree on a mediator within 10 days of the date of the agreement to request mediation, the chairperson of the [Joint EPA Implementation Committee][ESA-EC Committee of Senior Officials], or his or her delegate, shall select by lot a mediator from the pool of individuals who are on the list referred to in Article 20 and are not nationals of either Party. The selection shall be made within 20 days of the date of the submission of agreement to request mediation and in the presence of a representative of each Party. The mediator will convene a meeting with the Parties no later than 30 days after being selected. The mediator shall receive the submissions of each Party no later than 15 days before the meeting and notify an opinion no later than 45 days after having been selected.

3. The mediator’s opinion may include a recommendation on how to resolve the dispute consistent with this Agreement. the provisions referred to in [Article 2]. The mediator’s opinion is non-binding.

4. The Parties may agree to amend the time limits referred to in paragraph 2. The mediator may also decide to amend these time limits upon request of any of the Parties or on his own initiative, given the particular difficulties experienced by the Party concerned or the complexities of the case. The mediator shall notify each Party of any such decision within 10 days of the request.

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5. The proceedings involving mediation, in particular all information disclosed and positions taken by the Parties during these proceedings shall remain confidential.


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CHAPTER III

DISPUTE SETTLEMENT PROCEDURES

Section I – Arbitration Procedure

Article 6

Initiation of the arbitration procedure

1. Where the Parties have failed to resolve the dispute by recourse to consultations as provided for in Article 4, or by recourse to mediation as provided for in Article 5, the complaining Party may request the establishment of an arbitration panel.

2. The request for the establishment of an arbitration panel shall be made in writing to the Party complained against and the Joint EPA Implementation Committee. The complaining Party shall identify in its request the specific [situation or] measures at issue, it shall explain how such [situation]measure constitutes a breach of the provisions referred to in this Agreement, and indicate, if appropriate, whether the matter is urgent pursuant to Article 9 (2).

Article 7

Establishment of the arbitration panel

1. An arbitration panel shall be composed of three arbitrators.

2. Within 10 days of the date of the submission of the request for the establishment of an arbitration panel to the [Joint EPA Implementation Committee], the Parties shall consult in order to reach an agreement on the composition of the arbitration panel.

3. In the event that the Parties are unable to agree on its composition within the time frame laid down in paragraph 2, either Party may request the chairperson of the [Joint EPA Implementation Committee], or her or his delegate, to select all three members by lot from the list established under Article 20, one among the individuals proposed by the complaining Party, one among the individuals proposed by the Party complained against and one among the individuals selected by the Parties to act as chairperson. Where the Parties agree on one or more of the members of the arbitration panel, any remaining members shall be selected by the same procedure.

4. The chairperson of the [Joint EPA Implementation Committee][ESA-EC Committee of Senior Officials], or her or his delegate, shall select the arbitrators within five days of the request referred to in paragraph 3 by either Party and in the presence of a representative of each Party.

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5. The date of establishment of the arbitration panel shall be the date on which the three arbitrators are selected.

Article 8

Interim panel report

[The arbitration panel shall notify to the Parties an interim report containing both the descriptive section and its findings and conclusions, as a general rule not later than 120 days from the date of establishment of the arbitration panel. Any Party may submit written comments to the arbitration panel on precise aspects of its interim report within 15 days of the notification of the report.][(ESA explained concern was capacity constraints, EC pointed out usefuless for settling disputes of interim panel reports – both parties to consider further)] (ESA requested EC to reconsider)

Article 9

Notification of arbitration panel ruling

1. The arbitration panel shall notify its ruling to the Parties and to the Joint EPA Implementation Committee within 150 days from the date of the establishment of the arbitration panel. Where it considers that this deadline cannot be met, the chairperson of the arbitration panel must notify the Parties and the [Joint EPA Implementation Committee][ESA-EC Committee of Senior Officials] in writing, stating the reasons for the delay and the date on which the panel plans to conclude its work. Under no circumstances should the ruling be notified later than 180 days from the date of the establishment of the arbitration panel.

2. In cases of urgency, including those involving perishable and seasonal goods, the arbitration panel shall notify its ruling within 75 [45] days from the date its establishment. Under no circumstance should it take longer than 90 [75] days from its establishment. The arbitration panel [may] shall give a preliminary ruling within 10 days of its establishment on whether it deems the case to be urgent .[ESA to submit revised text proposing to require preliminary ruling in case of perishable goods] [EC to consider if use of word “shall” is acceptable] (EC to revert on the periods)

3. Either party may request the arbitration panel to provide a recommendation as to how the Party complained against could bring itself into compliance. [In the event of a dispute concerning the interpretation and application of Chapters [consider whether specific chapters require recommendations] the arbitration panel shall include a recommendation on how to ensure compliance with the provisions of such Chapters.]


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Section II – Compliance

Article 10

Compliance with the arbitration panel ruling

1. Each party [to the dispute] shall be bound to take the measures necessary to comply with the arbitration panel ruling.

The Party complained against, or as the case may be, the relevant ESA Signatory State, shall take any measure necessary to comply with the arbitration panel ruling and the Parties will endeavour to agree on the period of time to comply with the ruling.

[2. Notwithstanding a ruling on compliance against an ESA party, the EC Party agrees to provide technical and financial assistance to an ESA State to enable such State to comply with a ruling.]

Article 11

The reasonable period of time for compliance

1. No later than 30 days after the notification of the arbitration panel ruling to the Parties, the Party complained against shall notify the complaining Party and the [Joint EPA Implementation Committee] of the time it will require for compliance (reasonable period of time).

2. If there is disagreement between the Parties on the reasonable period of time to comply with the arbitration panel ruling, the complaining Party shall, within 20 days of the notification made under paragraph 1, request in writing the arbitration panel to determine the length of the reasonable period of time. Such request shall be notified simultaneously to the other Party and to the [Joint EPA Implementation Committee]. The arbitration panel shall notify its ruling to the Parties and to the Joint EPA Implementation Committee within 30 days from the date of the submission of the request.

3 The arbitration panel will, in determining the length of the reasonable period of time, take into consideration the length of time that it will normally take the defending Party, or as the case may be, the relevant ESA Signatory State, to adopt comparable legislative or administrative measures to those identified by the defending Party, or as the case may be, the relvant ESA Signatory State, as being necessary to ensure compliance. The arbitration panel may shall also take into consideration capacity constraints and the different levels of development which may affect the adoption of the measures.

which may affect the defending Party’s adoption of the necessary measures [, having regard to the need to take account of the Special and Differential Treatment for ESA States].

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[Parties to reconsider in light of evolution of development co-operation section] [CARIFORUM text adopted “shall”]

4. In the event of the original arbitration panel, or some of its members, being unable to reconvene, the procedures set out in Article 7 shall apply. The time limit for notifying the ruling shall be 45 days from the date of the submission of the request referred to in paragraph 2.

5. The reasonable period of time may be extended by agreement of the Parties.

Article 12

Review of any measure taken to comply with the arbitration panel ruling

1. The Party complained against shall notify the other Party and the [Joint EPA Implementation Committee] before the end of the reasonable period of time of any measure that it has taken to comply with the arbitration panel ruling.

2. In the event that there is disagreement between the Parties concerning the compatibility of any [situation or] measure notified under paragraph 1, with the provisions of this Agreement, the complaining Party may request in writing the arbitration panel to rule on the matter. Such request shall identify the specific [situation or] measure at issue and it shall explain how such measure is incompatible with the provisions of this Agreement. The arbitration panel shall notify its ruling within 90 days of the date of the submission of the request. In cases of urgency, including those involving perishable and seasonal goods, the arbitration panel shall notify its ruling within 45 days of the date of the submission of the request.

3. In the event of the original arbitration panel, or some of its members, being unable to reconvene, the procedures set out in Article 7 shall apply. The time limit for notifying the ruling shall be 105 days from the date of the submission of the request referred to in paragraph 2.

Article 13

Temporary remedies in case of non-compliance

1. If the Party concerned fails to notify any measure taken to comply with the arbitration panel ruling before the expiry of the reasonable period of time, or if the arbitration panel rules that the measure notified under Article 11 paragraph 1 is not compatible with that Party’s obligations under the provisions referred to in this Agreement, the Party complained against shall, if so requested by the complaining Party, present an offer for temporary compensation.

[2. If no agreement on compensation is reached within 30 days of the end of the reasonable period of time or of the arbitration panel's ruling under Article 11


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that a measure taken to comply is not compatible with the provisions referred to in this Agreement the complaining Party shall be [entitled, upon notification to the other Party, to adopt appropriate measures [including [the suspension of benefits granted under the provisions referred to in Article 2 [2.1]at a level equivalent to the adverse economic impact caused by the violation.] include prior ruling on appropriateness (proportionate) of measures before their adoption] The complaining Party may adopt the appropriate trade measures 10 days after the date of the notification.

(ESA comments to be re-considered after review of EC revised text)

[2. If no agreement on compensation is reached within 30 days of the end of the reasonable period of time or of the arbitration panel's ruling under Article 11 that a measure taken to comply is not compatible with the provisions referred to in this Agreement the complaining Party shall be entitled, upon notification to the other Party, to adopt appropriate measures. In adopting such measures, the complaining party shall endeavour to select measures that least affect the objective of this Agreement and shall take into consideration the impact on the economy of the party complained against and on the individual ESA State. The complaining Party may adopt the appropriate trade measures 10 days after the date of the notification.](Alternative text submitted by EC)

3. The EC party shall exercise due restraint in asking for compensation or adopting appropriate measures pursuant to paragraph 1 or 2 of this Article in particular where failure to comply results from capacity constraints in the relevant ESA Signatory State.(Alternative text submitted by the EC)

[3. Appropriate measures adopted pursuant to this provision shall not affect the delivery of development assistance

-clarify measures in relation to trade measures: not affect development assistance]

4. The appropriate measures shall be temporary and shall be applied only until any measure [situations] found to violate the provisions of this Agreement has been withdrawn or amended so as to bring it into conformity with those provisions or until the Parties have agreed to settle the dispute. ]

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Article 14

Review of any measure[situation] taken to comply after the adoption of appropriate measures

1. The Party complained against shall notify the other Party and the Joint EPA Implementation Committee of any measure [situation] it has taken to comply with the ruling of the arbitration panel and of its request for an end to application of appropriate measures by the complaining Party.

2. If the Parties do not reach an agreement on the compatibility of the notified measure with the of this Agreement within 30 days of the date of the submission of the notification, the complaining Party shall request in writing the arbitration panel to rule on the matter. Such request shall be notified to the other Party and to the [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials]. The arbitration panel ruling shall be notified to the Parties and to the [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials]within 45 days of the date of the submission of the request. If the arbitration panel rules that any measure taken to comply is not in conformity with the provisions of this Agreement, the arbitration panel will determine whether the complaining Party can continue to apply appropriate measures. If the arbitration panel rules that any measure [situation]taken to comply is in conformity with the provisions of this Agreement, the appropriate measures shall be terminated.

3. In the event of the original arbitration panel, or some of its members, being unable to reconvene, the procedures laid down in Article 7 shall apply. The period for notifying the ruling shall be 60 days from the date of the submission of the request referred to in paragraph 2.

Section III – Common Provisions

Article 15

Mutually agreed solution

The Parties may reach a mutually agreed solution to a dispute under this Agreement at any time. They shall notify the [Joint EPA Implementation Committee] of any such solution. Upon adoption of the mutually agreed solution, the procedure shall be terminated.

Article 16

Rules of procedure

1. Dispute settlement procedures under Chapter III of this Part shall be governed by the Rules of Procedure adopted by [institutional body]…..within 3 months of provisional application of this Agreement.


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2. Any meeting of the arbitration panel shall be open to the public in accordance with the Rules of Procedure, unless the arbitration panel decides otherwise on its own motion or at the request of the Parties.

Article 17

Information and technical advice

At the request of a Party, or upon its own initiative, the arbitration panel may obtain information from any source, including the Parties involved in the dispute, it deems appropriate for the arbitration panel proceeding. The arbitration also has the right to seek the relevant opinion of experts as it deems appropriate. Interested parties are authorised to submit amicus curiae briefs to the arbitration panels in accordance with the Rules of Procedure. Any information obtained in this manner must be disclosed to each of the Parties and submitted for their comments.

Article 18

Languages of the submissions

The written and oral submissions of the country concerned shall be made in [English and French], [and those of the European Communities in any of the official languages of the European Union]. [Either party may arrange for submissions to be made in another language for their own convenience without requiring the other party to use that language.](EC to revert to ESA on the proposed change)

EC proposal 20.7.07

1. The written and oral submissions of the [Parties] shall be made in any official language of the Parties.

2. The Parties shall endeavour to agree on a common working language for any specific proceedings under this Particle If the Parties are unable to agree on a common working language, each Party shall arrange for and bear the costs of the translation of its written submissions and interpretation at the hearings into the language chosen by the other Party, unless such language is an official language of that Party.15 The EC party shall, when seeking to agree on a common working language taking o account the potential impact of such cost on ESA Signatory States.

15 [new footnote] For the purpose of this article the official languages of the ESA States are [ ..] and the official languages of the EC Party are those indicated in art [..]12 (authentic texts).

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Article 19

Rules of interpretation

Any arbitration panel shall interpret the provisions referred to in this Agreement in accordance with customary rules of interpretation of public international law, including the Vienna Convention on the Law of Treaties and taking account the objectives of this Agreement of the need to have a [development centred interpretive approach]. The rulings of the arbitration panel cannot add to or diminish the rights and obligations provided in the provisions referred to in in this Agreement.

(Parties to consider alternative text proposing that an Arbitration Ruling can make recommendations on the nature of actions that could be taken by the parties – location also requires consideration])

EC proposal 20.7.07

3. Either party may request the arbitration panel to provide a recommendation as to how the Party complained against could bring itself into compliance. In the event of a dispute concerning the interpretation and application of Chapters [consider whether specific chapters require recommendations] the arbitration panel shall include a recommendation on how to ensure compliance with the provisions of such Chapters.]

Article 20

Arbitration panel rulings

1. The arbitration panel shall make every effort to take any decision by consensus. Where, nevertheless, a decision cannot be arrived at by consensus, the matter at issue shall be decided by majority vote.[ However, in no case dissenting opinions of arbitrators shall be published.]

[EC to revert to ESA on provision]

[EC comment on 20.7.07 – EC remains in favour of specifying that dissenting opinions should not be published – encourages efforts to find agreement between arbitrators]2. The ruling shall set out the findings of fact, the applicability of the relevant provisions of this Agreement and the basic rationale behind any findings and conclusions that it makes. The [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials] shall make the arbitration panel rulings publicly available unless it decides not to do so.


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CHAPTER IV

GENERAL PROVISIONS

Article 21

List of arbitrators

1. The [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials] shall, no later than six months after the entry into force of this Agreement [provisional application of this Agreement], establish a list of 15 individuals who are willing and able to serve as arbitrators. Each of the Parties shall select five individuals to serve as arbitrators. The two Parties shall also agree on five individuals that are not nationals of either Party and who shall act as chairperson to the arbitration panel. The Joint EPA Implementation Committee will ensure that the list is always maintained at this level.

2. Arbitrators shall have specialised knowledge or experience of law and international trade. They shall be independent, serve in their individual capacities and not take instructions from any organisation or government, or be affiliated with the government of any of the Parties, and shall comply with the Code of Conduct adopted by [institutional body]……within three months of provisional entry into force of this Agreement.

3. The [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials] may establish an additional list of 15 individuals having a sectoral expertise in specific matters covered by this Agreement. When recourse is made to the selection procedure of Article 7 paragraph 2, the chairperson of the [Joint EPA Implementation Committee] [ESA-EC Committee of Senior Officials] may use such a sectoral list upon agreement of both Parties.

Article 22

Time lines

1. All time limits laid down in this Part, including the limits for the arbitration panels to notify their rulings, shall be counted in calendar days from the day following the act or fact to which they refer.

2. Any time limit referred to in this Part may be extended by mutual agreement of the Parties.

Article 23

[Modification of Part III] The [Joint EPA Council] [ESA-EC Council] may decide to modify this Part and its annexes.

PART IV

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[GENERAL EXCEPTIONS

[Scrutiny reserve to ensure consistency with other provisions of the EPA]

Article 24

General exception clause

1. Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between the Parties where like conditions prevail, or a disguised restriction on (international trade) [trade in goods, services or establishment,] nothing in this Agreement shall be construed to prevent the adoption or enforcement by the EC Party, the ESA States or a Signatory ESA State of measures which:

(a) are necessary to protect public morals or to maintain public order and public security;(b) are necessary to secure compliance with laws or regulations which are not inconsistent with this Agreement, including those relating to customs enforcement, the protection of intellectual property rights, and the prevention of deceptive practices;(c) are necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement including those relating to:

(i) the prevention of deceptive and fraudulent practices or to deal with the effects of a default on contracts;(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts; or(iii) safety;

(d) relate to the importation or exportation of gold or silver( ESA to consider);(e) relate to the protection of national treasures of artistic, historic or archaeological value;(f) relate to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption of goods, domestic supply or consumption of services and on domestic investors; (g) relate to the products of prison labour; or(h) inconsistent with Articles […] on National Treatment, provided that the difference in treatment is aimed at ensuring the effective or equitable imposition or collection of direct taxes in respect of economic activities or investors of the other Party.

2. [The provisions of Title … and of Annexes … [lists of commitments on establishment and cross-border supply of services] shall not apply to the EC Party and Signatory ESA States respective social security systems or to activities


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in the territory of each Party, which are connected, even occasionally, with the exercise of official authority.] pending outcome of services negotiations

Article 25

Security exceptions

1. Nothing in this Agreement shall be construed:

(a) to require the EC Party or a Signatory ESA State to furnish any information the disclosure of which it considers contrary to its essential security interests;(b) to prevent the EC Party or a Signatory ESA State from taking any action which it considers necessary for the protection of its essential security interests:

(i) relating to fissionable and fusionable materials or the materials from which they are derived;(ii) relating to economic activities carried out directly or indirectly for the purpose of supplying or provisioning a military establishment;(iii) relating to government procurement indispensable for national security or for national defence purposes; or(iv) taken in time of war or other emergency in international relations; or

(c) to prevent the EC Party or a Signatory ESA State from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

[EC to propose redraft of certain elements]

EC proposal of 20.7.07 – replace (c) with:

(c) to prevent the EC Party or a Signatory ESA State from taking any action in order to carry out obligations it has accepted for the purpose of maintaining international peace and security.

2. The Joint EPA Implementation Committee shall be informed to the fullest extent possible of measures taken under paragraphs 1(b) and (c) and of their termination.

[Article 26

Taxation

1. Nothing in this Agreement or in any arrangement adopted under this Agreement shall be construed to prevent the EC Party or a Signatory ESA State from distinguishing, in the application of the relevant provisions of their fiscal legislation, between taxpayers who are not in the same situation, in particular

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with regard to their place of residence or with regard to the place where their capital is invested.

2. Nothing in this Agreement or in any arrangement adopted under this Agreement shall be construed to prevent the adoption or enforcement of any measure aimed at preventing the avoidance or evasion of taxes pursuant to the tax provisions of agreements to avoid double taxation or other tax arrangements or domestic fiscal legislation.

3. Nothing in this Agreement shall affect the rights and obligations of the EC Party or a Signatory ESA State under any tax convention. In the event of any inconsistency between this Agreement and any such convention, that convention shall prevail to the extent of the inconsistency.]-pending services negotiations

(ESA States to consult on implications of this provision)

PART V

INSTITUTIONAL PROVISIONS

Text on Institutional provisions not agreed. Parties to consider ESA and EC proposals with a view to identifying common ground and possible common text. EC refers to Article 1 to 7 of its “Institutional provisions”. ESA proposes that starting point should be the following text:

[Article 27

Joint Institutions

The Joint Institutions of this agreement are the ESA-EU Council of Ministers, Committee of Senior Officials and Specialised Committees.

Article 28

ESA-EU Council of Ministers

1. An ESA-EU Council of Ministers is hereby established

.2. The Council shall comprise, on the one hand, a member of the Government of each ESA State, and on the other the members of the Council of the EU and members of the Commission of the European Communities.

3. The Office of the President of the Council shall be held alternately by a member of the Council of the EU and a member of the government of an ESA country.


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4. The Council shall meet at Ministerial level at regular intervals, at least once every one year, and at extraordinary sessions, at the request of either Party.

5. The Council shall adopt its own rules of procedure within the first year after entry into force of this Agreement.

6. The functions of the Council shall be:

(a) to supervise the implementation of this Agreement;

(b) to examine proposals and recommendations from the Parties, including the Committee of Senior Officials, for the effective implementation of this Agreement and enhancement of the Agreement;

(c) examine and make recommendations on any issue of common interest relating to the smooth implementation of the EPA, in particular the need for development support to be provided;

Provide for decisions on issues on which the Council would have full powers to do so under this Agreement. Reconcile with ACP issues where only recommendations can be made

(d) to examine the impact of wider liberalisation initiatives by the EU on the ESA-EU trade and the ESA Economies. It shall adopt the necessary measures with a view to preserving the benefits of this agreement; and

7. Subject to Article ….. (on dispute settlement) the Council shall, for the purpose of attaining the objectives of this Agreement, have the power to take decisions in all matters covered by this Agreement.

8. The decisions of Council shall be binding on all Parties which shall take all necessary measures to implement them.

9. The Council may also make appropriate recommendations on all relevant issues to the ACP-EU Council of Ministers.

10. The Council shall adopt its decisions by common agreement of the parties. The proceedings of the Council of Ministers shall be valid only if half the members of the Council of the European Union, one member of the Commission and two-thirds of the members representing the governments of the ESA States are present. Any member of the Council of Ministers unable to attend may be represented. The representative shall exercise all the rights of that Member.

(Review if there may not be need for all ESA States to ratify Agreement before it comes into force. However this is subject to the definition of “party”).

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Article 29

Committee of Senior Officials

1. The ESA-EU Council shall be assisted by a Committee of Senior Officials composed of representatives of members of the EU on the one hand and representatives of ESA States on the other.

2. The Committee shall make recommendations to Council on policy matters.

3. The Committee shall prepare for the sessions of Council.

4. The Committee shall meet once a year, or in extra-ordinary session as and when either Party requests.

5. The Committee shall be chaired alternately by a representative of each of the Parties.

6. The Committee shall adopt its own rules of procedure, within six months of entry into force of this Agreement.

Article 30

Specialised Committees

1. Specialised Committees established pursuant to this Agreement, shall assist the Council in the performance of its duties.(Identify all the specialised Committees and list them in this paragraph)

2. The Council may decide to set up any additional specialised committees.]

[Article….Joint ESA-EC Council

1. A Joint ESA-EC Council is hereby established, which shall supervise the implementation of this Agreement. The Joint ESA-EC Council shall meet at ministerial level at regular intervals, not exceeding a period of two years, and extraordinarily whenever circumstances so require, if the Parties so agree.

2. Without prejudice to the functions of the Council of Ministers as defined in Article 15 of the Cotonou Agreement, the Joint ESA-EC Council shall generally be responsible for the operation and implementation of this Agreement and shall monitor the fulfilment of its objectives. It shall also examine any major issue arising within the framework of this Agreement, as well as any other bilateral,


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multilateral or international question of common interest and affecting trade between the Parties.

3. The Joint ESA-EC Council shall also examine proposals and recommendations from the Parties for the review of this Agreement.

Article ….

Composition and rules of procedures

1. The Joint ESA-EC Council shall be composed, on the one hand, of the members of the Council of the European Union and members of the European Commission, and, on the other hand, of the representatives of the Governments of the Signatory ESA States.

2. The ESA States shall mandate one of their representatives to act on their behalf on all matters under this Agreement for which they have agreed to act collectively.

3. The Joint ESA-EC Council shall establish its own rules of procedure.

4. The Joint ESA-EC Council shall be chaired in turn by a Member of the European Commission and by a ESA representative, in accordance with the provisions laid down in its rules of procedure. The Joint ESA-EC Council shall provide periodic reports on the operation of this Agreement to the Council of Ministers established in accordance with Article 15 of the Cotonou Agreement.

5. Members of the Joint ESA-EC Council may arrange to be represented, in accordance with the conditions laid down in its rules of procedure.

Article ….

Decision-making powers and procedures

1. In order to attain the objectives of this Agreement, the Joint ESA-EC Council shall have the power to take decisions in respect of all matters covered by the Agreement.

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2. The decisions taken shall be binding on the Parties [and the Signatory ESA States], which shall take all the measures necessary to implement them in accordance with each Party's and Signatory ESA State's internal rules.

3. The Joint ESA-EC Council may also make appropriate recommendations.

4. For the matters for which Signatory ESA States agree to act collectively the Joint ESA-EC Council shall adopt decisions and recommendations by [mutual] agreement between the [Parties]. For the matters for which Signatory ESA States have not agreed to act collectively, adoption of any decision shall require the agreement of the Signatory ESA State or States concerned.

Article ….

Joint ESA-EC Implementation Committee

1. The Joint ESA-EC Council shall be assisted in the performance of its duties by a Joint ESA-EC Implementation Committee composed of representatives of the Parties, normally at senior officials level. The ESA States shall mandate one of their representatives to act on their behalf on all matters under this Agreement for which they have agreed to act collectively.

2. The Joint ESA-EC Council shall establish the rules of procedure of the Joint ESA-EC Implementation Committee. The Joint ESA-EC Implementation Committee shall be chaired alternately by a representative of each of the Parties for a period of one year.

3. The Joint ESA-EC Implementation Committee shall have, in particular, the following functions:

(a) to supervise and be responsible for the implementation and proper application of the provisions of the Agreement and to discuss and recommend cooperation priorities in this regard;

(b) to oversee the further elaboration of the provisions of this Agreement and evaluate the results obtained in its application;

(c) to undertake action to avoid disputes and to resolve disputes that may arise regarding the interpretation or application of the Agreement, in accordance with the provisions of Part …….;

(d) to assist the Joint ESA-EC Council in the performance of its functions;

(e) to supervise the work of all the special committees provided for in paragraph 4;


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(f) to monitor the development of regional integration and of economic and trade relations between the Parties;

(g) to monitor and assess the impact of the implementation of this Agreement on the sustainable development of the Parties;

(h) to discuss any matters pertaining to this Agreement and any issue liable to affect the attainment of its objectives;

(i) to discuss and undertake actions that may facilitate trade, investment and business opportunities between the Parties;

(j) to carry out any other function entrusted to it by the Joint ESA-EC Council; and

(k) to report annually to the Joint ESA-EC Council.

4. In the performance of its functions, the Joint ESA-EC Implementation Committee may:

(a) set up any special committees or bodies to deal with matters falling within its competence, determine their composition, duties and rules of procedure and oversee their operation;

(b) meet at any time agreed by the Parties;

(c) consider any issues under this Agreement and take appropriate action in the exercise of its functions; and

(d) take decisions or make recommendations in accordance with Article 3.

5. The Joint ESA-EC Implementation Committee shall generally meet once a year for an overall review of the implementation of this Agreement, on a date and with an agenda agreed in advance by the Parties, in the EC Party one year and in a [Signatory] ESA State the next.

Article …

Joint ESA-EC Development Committee

1. The Joint ESA-EC Council shall be assisted in the performance of its duties relating to cooperation matters by a Joint ESA-EC Development Committee composed of representatives of the Parties, normally at senior official level. [The ESA States shall mandate one of their representatives to act on their behalf on all matters under this Agreement for which they have agreed to act collectively.]

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2. The Joint ESA-EC Council shall establish the rules of procedure of the Joint ESA-EC Development Committee. The Joint ESA-EC Development Committee shall be chaired alternately by a representative of each of the Parties.

3. The Joint ESA-EC Development Committee shall have, in particular, the following functions:

(a) to assist the Joint ESA-EC Council in the performance of its functions regarding development cooperation related matters falling under this Agreement;

(b) to monitor the implementation of the cooperation provisions laid down in this Agreement and to coordinate such action with third party donors;

(c) to make recommendations on trade-related cooperation between the Parties;

(d) to keep under periodic review the cooperation priorities set out in this Agreement, and to make recommendations on the inclusion of new priorities, as appropriate;

(e) to review and discuss cooperation issues pertaining to regional integration and implementation of this Agreement;

(f) to carry out any other function entrusted to it by the Joint ESA-EC Council; and

(g) to report regularly to the Joint ESA-EC Council on cooperation between the Parties.

4. In the performance of its functions, the Joint ESA-EC Development Committee may:

(a) set up any special committees or bodies to deal with matters falling within its competence, and determine their composition and duties, and their rules of procedure;

(b) meet at any time agreed by the Parties;

(c) consider any issues under this Agreement and take appropriate action in the exercise of its functions; and

(d) take decisions or make recommendations in accordance with Article 3.

5. The Joint ESA-EC Development Committee shall generally meet once a year for an overall review of the implementation of cooperation related matters falling under this Agreement, on a date and with an agenda agreed in advance by the Parties, in Brussels one year and in a [Signatory] ESA State the next.

Article …


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Joint ESA-EC Consultative Committee

1. A Joint ESA-EC Consultative Committee is hereby established with the task of assisting the Joint ESA-EC Council to promote dialogue and cooperation between representatives of organisations of civil society, including the academic community, and social and economic partners. Such dialogue and cooperation shall encompass all economic, social and environmental aspects of the relations between the EC Party and ESA States, as they arise in the context of the implementation of this Agreement.

2. Participation in the Joint ESA-EC Consultative Committee shall be decided by the Joint ESA-EC Council, with a view to ensuring a broad representation of all interested parties.

3. The Joint ESA-EC Consultative Committee shall carry out its activities on the basis of consultation by the Joint ESA-EC Council or on its own initiative and make recommendations to the Joint ESA-EC Council. Representatives of the Parties shall attend the meetings of the Joint ESA-EC Consultative Committee.

4. The Joint ESA-EC Consultative Committee shall adopt its rules of procedure in accord with the Joint ESA-EC Council.

5. The Joint ESA-EC Consultative Committee may make recommendations to the Joint ESA-EC Council, the Joint ESA-EC Implementation Committee and the Joint ESA-EC Development Committee.

Article …

Specialised Committees

3. Specialised Committees established pursuant to this Agreement, shall assist the Council in the performance of its duties.(Identify all the specialised Committees and list them in this paragraph)

4. The Council may decide to set up any additional specialised committees.]

PART VI

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GENERAL AND FINAL PROVISIONS

ARTICLE …

Definition of the Parties and fulfilment of obligations

1. Contracting Parties of this Agreement shall be the Republic of Burundi, L’Union Des Comores, the Democratic Republic of the Congo, the Republic of Djibouti, the State of Eritrea, the Federal Democratic Republic of Ethiopia, the Republic of Kenya, the Republic of Madagascar, the Republic of Malawi, the Republic of Mauritius, the Republic of Rwanda, the Republic of Seychelles, the Republic of Sudan, the Republic of Uganda, the Republic of Zambia and the Republic of Zimbabwe, hereinafter referred to as the "ESA States", on the one part, and the European Community or its Member states or the European Community and its Member States within their respective areas of competency as derived from the treaty establishing the EC, and hereinafter referred to as the "EC Party", on the other part for which the agreement has entered into force or is provisionally applied.

2 For the purposes of this Agreement, unless otherwise expressly provided, the ESA States agree to act collectively. In cases where individual action is provided for or required to exercise the rights and or comply with obligations under this Agreement reference is made to “signatory ESA State”.

3. The Parties or the signatory ESA State as the case may be shall adopt any general or specific measures required for them to fulfil their obligations under this Agreement and shall ensure that they comply with the objectives laid down in this Agreement.

4. A signatory ESA State which is not subject to the rights and obligations set out in Chapter II shall nevertheless be subject to and enjoy the rights and obligations arising from other Chapters of this Agreement

ARTICLE 62

Entry into force, denunciation and duration

1. This Agreement shall enter into force the first day of the month following that in which the Signatory ESA States and the EC Party have notified each other of the completion of the procedures necessary for this purpose.

2. Notifications shall be sent to the Secretary General of the Council of the European Union, who shall be the depository of this Agreement.


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3. Pending entry into force of the Agreement, the European Communities and the Signatory ESA States shall agree to provisionally apply the Agreement. This may be effected by provisional application pursuant to the laws of a signatory or by ratification of the Agreement. Provisional application shall be notified to the depositary. The Agreement shall be applied provisionally 10 days after the latter of the receipt of notification of provisional application from the European Communities or from all the Signatory ESA States.

4. Notwithstanding paragraph 3, the EC Party and the Signatory ESA States may unilaterally apply the Agreement, in whole or in part, before provisional application, to the extent that this is possible under their domestic law.

5. The EC Party or a signatory ESA States may give written notice to the other of its intention to denounce this Agreement.

6. Denunciation shall take effect one month after notification to the other Party.

7 This Agreement shall remain in force indefinitely.

Article …..

Territorial application

This Agreement shall apply, on the one hand, to the territories in which the Treaty establishing the European Community is applied and under the conditions laid down in that Treaty, and, on the other hand, to the territories of signatory ESA States. References in this Agreement to ‘territory’ shall be understood in this sense.

Article 31

Definition of the Parties and fulfilment of obligations

[1. For the purposes of this Agreement, the Parties shall mean Burundi, Comoros, D.R Congo, Djibouti, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Uganda, Zambia and Zimbabwe, hereinafter referred to as the "ESA States", on the one part, and the European Community or its Member States or the European Community and its Member States, within their respective areas of competence as derived from the Treaty establishing the European Community, hereinafter referred to as the "EC Party", on the other.

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2. For the purposes of this Agreement, unless otherwise expressly provided, the ESA States agree to act collectively. In cases individual action is provided for or required to exercise the rights or comply with the obligations under this Agreement reference is made to the "Signatory ESA States".

3. The Parties and the Signatory ESA States shall adopt any general or specific measures required for them to fulfil their obligations under this Agreement and shall ensure that they comply with the objectives laid down in this Agreement.]

[Article 32

Conflict between this Agreement and Other Treaties

In the case of conflict between this Agreement and any treaty, convention, agreement on trade cooperation that may impede the implementation of this Agreement, this Agreement shall prevail to the extent of the inconsistency.]

(EC to review and comment)

[EC comment 20.7.07

EC could consider if clear:

- that rule only applies between parties to this agreement (i.e. has no effect on 3 rd

countries)

- that rule only applies to agreements between parties to this agreement concluded before the EPA.

Both of these elements would need to be reflected in the text]

Article 33

Coordinators and exchange of information

1. In order to facilitate communication and to ensure the effective implementation of the Agreement the EC Party, the [ESA States collectively and each Signatory ESA State] shall designate a coordinator upon entry into force of this Agreement. The designation of coordinators is without prejudice to the specific designation of competent authorities under specific Titles or Chapters of this Agreement.


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2. On the request of either Party, the coordinator of the other Party or of a Signatory ESA State shall indicate the office or official responsible for any matter pertaining to the implementation of this Agreement and provide the required support to facilitate communication with the requesting Party.

3. On request of the other Party, and to the extent legally possible, each Party and the Signatory ESA States through their coordinators shall provide information and reply promptly to any question from the other Party relating to an actual or proposed measure that might affect trade between the Parties. The Parties agree to channel their exchanges of information through the ESA coordinator to the maximum extent possible.

4. [Each Party and the Signatory ESA States shall ensure that its laws, regulations, procedures and administrative rulings of general application relating to any trade matter covered by this Agreement are promptly published or made publicly available and brought to the attention of the other Party.

5. Without prejudice to specific transparency provisions in this Agreement, the information referred to under this Article shall be considered to have been provided when the information has been made available by appropriate notification to the WTO or when the information has been made available on the official, publicly and fee-free accessible website of the Party or of the Signatory ESA State concerned.]

(EC explained purpose of coordinators was to ensure smooth operation of the agreement. Paragraphs 4 and 5 not acceptable to ESA because considered difficult because of lack of capacity)

Article 34

Regional preference

1. Nothing in this Agreement shall oblige a Party to extend to the other Party of this Agreement any more favourable treatment which is applied within each of the Parties as part of its respective regional integration process.

2. Any more favourable treatment and advantage that may be granted under this Agreement by any Signatory ESA State to the EC Party shall immediately and unconditionally also be enjoyed by each signatory to this Agreement.

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Article 5

Outermost regions of the European Community

1. Taking account of the geographical proximity of the outermost regions of the European Community and the ESA States and in order to reinforce economic and social links between these regions and the ESA states, the Parties shall endeavour to specifically facilitate co-operation in all areas covered by the present Agreement as well as build and improve on existing trade in goods and services, promote investments and encourage transport and communication links between the outermost regions and the ESA States.

2. The objectives enunciated in paragraph 1 shall also be pursued, wherever possible, through fostering the joint participation of the ESA States and the outermost regions in framework and specific programmes of the European Community in areas covered by this Agreement.

3. The EC Party shall endeavour to ensure coordination between the different financial instruments of the European Community's cohesion and development policies in order to foster cooperation between ESA States and the outermost regions of the European Community in the areas covered by this Agreement.

[4. Nothing in this Agreement shall prevent the EC Party from applying existing measures aimed at addressing the structural social and economic situation of the Outermost region pursuant to article 299(2) of the Treaty establishing the European Community.]

ESA states still to review paragraph 4 from Interim Agreement

Article 35

Outermost regions of the European Community

1. [Taking account of the geographical proximity of the outermost regions of the European Community and the ESA States and in order to reinforce economic and social links between these regions and the ESA states, the Parties shall endeavour to specifically facilitate co-operation in all areas covered by the present agreement as well as facilitate trade in goods and services, promote investments and encourage transport and communication links between the outermost regions and the ESA states.16

16 The specific interests of the EU outermost regions are still being examined and appropriate language may be proposed.

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2. Wherever possible, the participation of ESA States in framework and specific programmes of the European Community in areas covered by this agreement shall include co-operation with outermost regions.

(EC to submit re-draft of paragraph 2)

EC proposal 20.7.07

The objectives enunciated in paragraph 1 shall be pursued, wherever possible also through fostering the joint participation of the ESA States and the outermost regions in framework and specific programmes of the European Community in areas covered by this Agreement.

3. The EC Party shall endeavour to ensure coordination between the different financial instruments of the European Community's cohesion and development policies in order to foster cooperation in these areas. ] EC explained para 3 was drafted in “endeavour” terms because these programmes had different legal bases

Text to be revisited in light of discussions on other Chapters

Article 36

Balance of payments difficulties

1. Where any Signatory ESA States or the EC Party is in serious balance of payments and external financial difficulties, or under threat thereof, it may adopt or maintain restrictive measures with regard to trade in goods and in services.

2. The Signatory ESA States and the EC Party shall endeavour to avoid the application of the restrictive measures referred to in paragraph 1.

3. Any restrictive measure adopted or maintained under this Article shall be non-discriminatory and of limited duration and shall not go beyond what is necessary to remedy the balance of payments and external financial situation. They shall be in accordance with the conditions established in the WTO Agreements and consistent with the Articles of Agreement of the International Monetary Fund, as applicable.

4. Any Signatory ESA States or the EC Party maintaining or having adopted restrictive measures, or any changes thereto, shall promptly notify them to the other Party and present, as soon as possible, a time schedule for their removal.


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5. Consultation shall be held promptly within the EPA Implementation Committee. Such consultations shall assess the balance of payments situation of the concerned Signatory ESA States or the EC Party and the restrictions adopted or maintained under this Article, taking into account, inter alia, such factors as:

(a) the nature and extent of the balance of payments and the external financial difficulties;(b) the external economic and trading environment;(c) alternative corrective measures which may be available.

The consultations shall address the compliance of any restrictive measures with paragraphs 3 and 4. All findings of statistical and other facts presented by the International Monetary Fund relating to foreign exchange, monetary reserves and balance of payments shall be accepted and conclusions shall be based on the assessment by the Fund of the balance of payments and the external financial situation of the concerned ESA State or EC Party.

ARTICLE …..

Relationship with other agreements

1 Nothing in this Agreement shall prejudice the application of measures deemed appropriate as provided for under Articles 11b, 96 and 97 of the Cotonou Agreement and according to procedures set by these articles

2 In case of any inconsistency between the provisions of this Agreement and the provisions of Title II of Part III of the Cotonou Agreement, with the exception of the development cooperation provisions contained therein, the provisions of this agreement shall prevail.

3 The Parties acknowledge that some ESA State(s) are not members of the WTO. Accordingly, references in this Agreement to WTO agreements (including the definitions provided therein) and WTO bodies or Committees shall not be construed as imposing on a signatory ESA State that is a not a member of the WTO any obligations arising from such WTO agreements or decisions of such bodies or Committees beyond the obligations expressly taken by such Signatory ESA State under this Agreement. Consequently, in the event of inconsistency between provisions of WTO agreements or decisions of WTO bodies or committees on the one part and provisions of this Agreement, the latter shall always prevail in respect of Signatory ESA State who are not parties to the WTO.

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4 The Parties agree that nothing in this agreement requires them or the ‘Signatory ESA States’ to act in a manner inconsistent with their WTO obligations.

Article 37

Relations with the Cotonou Agreement

1. [Upon entry into force of this Agreement the provisions of Title II of Part III of the Cotonou Agreement shall no longer be applicable between the Parties.] consider relationship with Article 32. EC to submit redraft

2. [Nothing in this Agreement shall be construed so as to prevent the adoption by the EC Party or a Signatory ESA State of any measures, including trade and trade-related measures, deemed appropriate as provided for under Articles 11b, 96 and 97 of the Cotonou Agreement. ] delete(Whole provision bracketed)

Article 38

Entry into force

1. This Agreement shall be signed, ratified or approved by the signatory in accordance with the applicable constitutional or internal rules and procedures of the respective Parties.

2. This Agreement shall enter into force the first day of the first month following the deposit of the last instrument of ratification, acceptance or approval in the case of the EU party and following the deposit of the instrument of ratification, acceptance or approval of an ESA Signatory Party.

3. Notifications of ratification, acceptance or approval shall be sent to the Secretary General of the Council of the EU, and to the Secretary General of COMESA who shall be the depositories of this Agreement.

4. Pending entry into force of this Agreement, the European Community, the EC Party and a Signatory ESA State may agree to apply the provisions of this Agreement which fall within their respective competences (“provisional application”). This may be effected either by provisional application where possible or by ratification of this Agreement.


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4. Provisional application shall be notified to the depositories. The Agreement shall be applied provisionally 10 days after receipt of notification of provisional application from the European Community or of ratification or provisional application from a Signatory ESA State listed in Annex I.

5. Notwithstanding paragraph 2 and 4, the European Community, the EC Party and Signatory ESA States may unilaterally take steps to apply this Agreement, before provisional application, to the extent possible.

6.

EC proposal 20.7.07

1. This Agreement shall enter into force the first day of the month following that in which the Signatory ESA States and the EC Party have notified each other of the completion of the procedures necessary for this purpose.

2. Notifications shall be sent to the Secretary General of the Council of the European Union, who shall be the depository of this Agreement.

3. Pending entry into force of the Agreement, the EC Party and the Signatory ESA States shall agree to provisionally apply the agreement. Such application may be effected by provisional application pursuant to the laws of a signatory or by ratification of the Agreement. Provisional application shall be notified to the depositary. The Agreement shall be applied provisionally 10 days after the latter of the receipt of notification of provisional application from the EC Party or from all the Signatory ESA States.

Article 39

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Duration

Without prejudice to the provisions on review (Article….) this Agreement shall be valid indefinitely.

Article 40Denunciation

1. This Agreement may be denounced by the European Community and its member states in respect of each ESA country and by each ESA country in respect of the Community and Member States upon six months notice.

2. [In case this Agreement is denounced by any of the parties, the rights and obligations of the parties arising from Chapter …… (Development) shall continue for a period of five years].

(ESA concern relates to development assistance programmes ongoing at time of denunciation - EC to revert to ESA on policy aspects of paragraph 2)

Article 41

Territorial application

This Agreement shall apply, on the one hand, to the territories in which the Treaty establishing the EC is applied and under the conditions laid down in that Treaty, and, on the other hand, to the territories of ESA States. References in this Agreement to “territories” shall be understood in this sense.

Article 42

Revision clause

1. [The Parties agree to consider extending this Agreement with the aim of broadening and supplementing its scope in accordance with their respective legislation, by amending it or concluding agreements on specific sectors or activities in the light of the experience gained during its implementation. The Parties may also consider revising this Agreement to bring Overseas Countries and Territories associated with the European Community within the scope of this Agreement. delete

2. As regards the implementation of this Agreement, either Party [EC: may] [CF: shall] make suggestions oriented towards expanding trade related cooperation, taking into account the experience acquired during the implementation thereof. delete


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3. [The Parties agree that this Agreement may need to be reviewed in the light of the expiration of the Cotonou Agreement.] include in the ESA text,

(parties to review need to modify by incorporatng key aspects in Article on Review – Art 47)

Article 43

Accession

1. Any of the following ESA States namely, Republic of Burundi, L’Union Des Comores, the Republic of Djibouti, the State of Eritrea, the Federal Democratic Republic of Ethiopia, the Republic of Kenya, the Republic of Madagascar, the Republic of Malawi, the Republic of Mauritius, the Republic of Rwanda, the Republic of Seychelles, the Republic of Sudan, the Republic of Uganda, the Republic of Zambia and the Republic of Zimbabwe may accede to this Agreement. This Agreement shall enter into force with respect to an acceding State in accordance with the applicable legal procedures of the EC Party and the ESA States and the acceding State The EC State shall endeavour to apply this Agreement to the acceding State as soon as possible.

2. Any request for accession to this Agreement made by any State or international legal entity of the ESA region not listed in paragraph 1 shall be presented to the EPA Council for determination.

3. The EPA Council shall lay down the conditions and specific arrangements of the State referred to in paragraph 2 for its accession.

4. This Agreement shall enter into force in relation to an acceding state on the date its instrument of accession shall be deposited.

1. The Joint EPA Council shall be advised of any request made by a third State to become a member of the European Union. During the negotiations between the Union and the applicant State, the EC Party shall provide the ESA States with any relevant information and they in turn shall convey their concerns to the EC Party so that it can take them fully into account. The ESA States shall be notified by the EC Party of any accession to the European Union (EU).

2. Any new Member State of the EU shall accede to this Agreement from the date of its accession to the EU by means of a clause to that effect in the act of accession. If the act of accession to the Union does not provide for such automatic accession of the EU Member State to this Agreement, the EU Member State concerned shall accede by depositing an act of accession with the General Secretariat of the Council of the European Union, which shall send certified copies to the ESA States.

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3. The Parties shall review the effects of the accession of new EU Member States on this Agreement. The Joint EPA Council may decide on any transitional or amending measures that might be necessary.- whole text bracketed- parties to consider combining ESA and EC texts- possible merging of EPAs (AU level) provision]

Article 44

Authentic texts

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

Article 45

Annexes

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

Article 46

Amendments

[1. Any Party may submit proposals for the amendment of this Agreement.

2. Any proposals for the amendment of this Agreement shall be submitted to the General Secretariats of the European Community and ESA countries in writing who shall within 30 days of its receipt communicate to the Parties.

3. The Parties who wish to comment on the proposals shall do so within 90 days from the date of the despatch of the proposal by the General Secretariats.

4. After the expiration of the period prescribed under paragraph 3 of this Article the General Secretariats shall submit the proposals and any comments thereon received from the Parties to the Council.

5. Any amendments to this Agreement shall be adopted by Council and shall enter into force when ratified by [ ] signatory Parties in accordance with Article…

6. The Council shall adopt any transitional measures that may be required in respect of the amended provisions until they come into force.]

Whole text bracketed EC to consider ESA proposal - (Subjet to conclusion of Institutional Aspects)]


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Article 47

General Review Clause

1. [The ESA-EU Council shall undertake a comprehensive review of the agreement 5 years after its signature. Thereafter it shall undertake regular reviews every 5 years or sooner.

2. The ESA-EU Council shall undertake a review if any of the parties requests.

3. The purpose of such reviews shall be:

a) in respect of any provisions of the Agreement which is considered by both parties as requiring review;

b) on the request of either party following an occurrence that adversely affects the interests of such party; or

c) to assess the progress made in the implementation and operations of this Agreement.

4. The parties agree that this Agreement may need to be reviewed in the light of the expiration of the Cotonou Agreement.]

[whole text bracketed – see comments re Article 42

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