Explanatory Memorandum to COM(2004)466 - Special conditions for trade with those areas of Cyprus in which the Government of Cyprus does not exercise effective control - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2004)466 - Special conditions for trade with those areas of Cyprus in which the Government of Cyprus does not exercise effective ... |
|---|---|
| source | COM(2004)466  |
| date | 07-07-2004 |
"The Comprehensive Settlement of the Cyprus Problem" as finalised by UN Secretary-General Kofi Annan was approved by the Turkish Cypriot electorate at the separate simultaneous referenda on 24 April 2004. In view of the Turkish Cypriot vote the UN Secretary-General, reporting on his mission of good offices in Cyprus i, expressed his hope that the Members of the UN Security Council 'can give a strong lead to all States to cooperate both bilaterally and in international bodies to eliminate unnecessary restrictions and barriers that have the effect of isolating the Turkish Cypriots and impeding their development' (para. 93).
Following the outcome of the referenda the Council stated on 26 April 2004:
"The Turkish Cypriot community have expressed their clear desire for a future within the European Union. The Council is determined to put an end to the isolation of the Turkish Cypriot community and to facilitate the reunification of Cyprus by encouraging the economic development of the Turkish Cypriot community. The Council invited the Commission to bring forward comprehensive proposals to this end, with particular emphasis on the economic integration of the island and on improving contact between the two communities and with the EU."
The attached draft proposal for a Council Regulation takes up the invitation of the Council and puts forward an important measure for putting an end to the economic isolation of the Turkish Cypriot community as it facilitates trade between the northern part of Cyprus and the EU Customs Territory.
The draft proposal offers a preferential regime for products entering the Customs Territory of the EU and contains inter alia detailed rules concerning the documents which would certify the origin of goods and which would be issued by the Turkish Cypriot Chamber of Commerce or another duly authorised body, phytosanitary inspection, food and product safety, taxation issues, communication obligations, and safeguard measures in the event of ineffective cooperation, irregularities or fraud. It is proposed that the preferential regime take the form of a tariff quota system which should be established with a view to encouraging economic development while avoiding the creation of artificial trade patterns or facilitating fraud.
It should be noted that this Regulation covers trade and not other issues such as transport. This Regulation is therefore without prejudice to the requirements which have to be fulfilled in order to comply with the international rules on security and safety of maritime and air transport. Moreover to the extent that special conditions are not determined, the general rules governing the Community's external trade are applicable, including for example Council Regulation (EEC) No 339/93 concerning controls of imported goods for the purpose of ensuring product safety.
The legal basis for this Regulation can only be Article 133 EC. Cyprus in its full territory became a Member State on 1 May 2004. However, the acquis is suspended in the areas not under effective control of the Government of the Republic of Cyprus (the 'Areas') according to Article 1 i of Protocol 10 of the Act of Accession. This means inter alia that the Community's customs code which defines the EC customs territory is not applicable in the 'Areas'. Consequently, trade with the Areas follows the rules applicable to third countries. This situation is not unique. There are other territories of the EU which are not included in the EC customs territory. For Ceuta, Melilla and Gibraltar, apart from special rules, trade rules based on Article 133 EC exist, whilst for Büsingen, Campione d'Italia and Helgoland the relevant third country rules apply generally.