FACTUAL PRESENTATION

ACCESSION OF COMOROS TO THE INTERIM ECONOMIC PARTNERSHIP AGREEMENT BETWEEN

THE EUROPEAN UNION AND THE EASTERN AND SOUTHERN AFRICA STATES

(GOODS)

Report by the Secretariat

This report, prepared for the consideration of the Accession of Comoros to the Interim Economic Partnership Agreement between the European Union and the Eastern and Southern Africa States, goods, has been drawn up by the WTO Secretariat on its own responsibility and in full consultation with the Parties. The factual presentation reproduces as closely as possible the terminology used in the Agreement and in the comments provided and does not imply official endorsement or acceptance by the Secretariat of such terminology. The report has been drawn up in accordance with the rules and procedures contained in the Decision for a Transparency Mechanism for Regional Trade Agreements (_WT/L/671) and thus does not imply any value judgement by the Secretariat regarding the contents of the Agreement.

Any technical questions arising from this report may be addressed to Flavia Cifarelli (tel: +41 22 739 6360 / flavia.cifarelli@wto.org) or Alberto Osnago (tel: +41 22 739 6969 / alberto.osnago@wto.org). Any statistical questions arising from this report may be addressed to Rowena Cabos (tel: +41 22 739 5185 / rowena.cabos@wto.org).

Table of Contents

Executive Summary. 4

1   Trade Environment. 5

2   Characteristic Elements of the Agreement. 8

2.1   Background information. 8

3   Provisions on trade in goods. 9

3.1   Import duties and charges, and quantitative restrictions. 9

3.1.1   General provisions. 9

3.1.2   Liberalization of trade and tariff lines. 9

3.1.3   Liberalization schedule. 9

3.1.3.1   European Union. 9

3.1.3.2   Comoros. 11

3.1.4   Tariff rate quotas. 12

3.2   Rules of origin. 12

3.3   Export duties and charges, and quantitative restrictions. 12

3.4   Regulatory provisions of the agreement 12

3.4.1   Standards. 12

3.4.1.1   Sanitary and phytosanitary measures. 12

3.4.1.2   Technical barriers to trade. 13

3.4.2   Safeguard mechanisms. 13

3.4.2.1   Global safeguard. 13

3.4.2.2   Bilateral safeguard. 13

3.4.3   Anti-dumping and countervailing measures. 13

3.4.4   Subsidies and state-aid. 14

3.4.5   Customs-related procedures. 14

3.4.6   Other regulations. 14

3.5   Sector-Specific Provisions of the Agreement 14

3.5.1   Fisheries. 14

4   General Provisions of the Agreement. 14

4.1   Transparency. 14

4.2   Current payments and capital movements. 14

4.3   Exceptions. 15

4.4   Accession and withdrawal 15

4.5   Institutional framework. 15

4.6   Dispute settlement 15

4.7   Relationship with other agreements concluded by the parties. 16

4.8   Government procurement 17

4.9   Intellectual property rights. 17

4.10   Competition. 18

4.11   Labour 18

4.12   Electronic commerce. 18

4.13   Environment 18

4.14   Small and medium-sized enterprises. 18

4.15   Gender 18

4.16   Economic and Development Cooperation. 18

Annex 1. 19

European Union. 19

Comoros. 19

Executive Summary

Comoros acceded to the Interim Economic Partnership Agreement (EPA) between the EU and the Eastern and Southern Africa (ESA) States on 7 February 2019. The Agreement aims to promote trade liberalization and integration of ESA States into the global economy. It has been provisionally applied since 14 May 2012 for the EU, Madagascar, Mauritius, Seychelles and Zimbabwe, with Comoros signing the Agreement in 2017. The Agreement is one of 47 notified RTAs in force for the EU, and one of four for Comoros.

The EU and Comoros differ greatly in economic scale and trade importance. While EU trade balance fluctuated, Comoros ran an increasing trade deficit from 2013 to 2021. Comoros represents only 0.003% of EU exports and even less of its imports. On the other hand, over 40% of Comoros' exports were destined to and 20% of its imports originated from the EU. Between 2016 and 2018, Comoros mainly exported vegetables (72%) and chemical products (18%), while its imports were more diverse, with this pattern also broadly reflected in the Parties bilateral trade.

Upon the Agreement’s entry into force in 2019, the EU eliminated nearly all tariffs on goods from Comoros, excluding arms and ammunition. Comoros originally committed to implement the tariff elimination under the Agreement by 2022. According to the EU, it granted a two year extension to this deadline so that Comoros would provide for the elimination of duties on 97.4% of tariff lines in 2024 corresponding to more than 80% of imports from the EU. However, Comoros has yet to implement the tariff liberalization under the Agreement.

Following the elimination of sugar quotas on European imports from ESA in 2009, there are no tariff-rate quotas applicable under the Agreement. The Agreement includes a standstill provision, MFN clauses, a ban on quantitative restrictions, and national treatment for imports, with potential derogations for LDCs like Comoros. Export duties and charges, and quantitative restrictions on exports are generally prohibited, with limited exceptions.

Rules of origin in the original agreement were replaced in 2020 to simplify the definition of "originating products" and administrative cooperation, and to offer more flexibility to economic operators. Regulatory provisions do not include specific clauses on sanitary and phytosanitary measures or technical barriers to trade, with negotiations for these areas part of a rendez-vous clause. Safeguard mechanisms, anti-dumping, and countervailing measures are in line with WTO disciplines.

The Agreement contains limited dispute settlement provisions that foresee consultations and arbitration. It does not contain specific provisions on labour, e-commerce, government procurement and gender. Cooperation is foreseen on areas such as SMEs, environment, and development more generally. A rendez-vous clause allows for negotiations to establish a full and comprehensive EPA covering areas such as customs and trade facilitation, trade in services, intellectual property rights, competition policy, sustainable development, and dispute settlement.