EU unveils new Generalised System of Preferences

27 Jun '05

4 min read

The current GSP, in place since 1995, applies to imports from developing countries that pay duty on entering the EU market and that are not already duty-free under Most Favoured Nation agreements.

The reform proposed by Commissioner Mandelson simplifies the EU GSP scheme by reducing the number of GSP arrangements from five to three. The coverage of the general GSP scheme will be extended to 300 additional products mostly in the agriculture and fishery sectors.

A new "GSP Plus" incentive scheme will be targeted at especially vulnerable countries that have ratified and effectively implemented key international conventions on sustainable development, labour rights and good governance.

It will cover around 7200 products which will enter the EU duty free. The GSP Plus incentive scheme will be fast-tracked to enter into force on a provisional basis on 1 July 2005.

The eligibility of countries placed in the GSP Plus incentive scheme will be confirmed by an assessment of their effective implementation of core human and labour rights, good governance and environmental conventions before the beginning of 2006.

The "Everything but Arms" arrangement which grants duty and quota free access for all imports except arms from least developed countries will remain unchanged.

The new system is made fairer by focusing preferential access on countries that have a lower share of EU imports. Groups of products from beneficiary cou> The new system is made fairer by focusing preferential access on countries that have a lower share of EU imports. Groups of products from beneficiary countries which in a given sector account for more than 15% of EU imports from GSP countries are "graduated" and cease to benefit from preferential access. In the case of textiles the "graduation threshold" is set at 12.5%, as it is for clothing.

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