CHAPTER IIGENERAL ARRANGEMENT
Article 4
1.
An eligible country shall benefit from the tariff preferences provided under the general arrangement referred to in point (a) of Article 1(2) unless:
(a)
it has been classified by the World Bank as a high-income or an upper-middle income country during three consecutive years immediately preceding the update of the list of beneficiary countries; or
(b)
it benefits from a preferential market access arrangement which provides the same tariff preferences as the scheme, or better, for substantially all trade.
2.
Points (a) and (b) of paragraph 1 shall not apply to least-developed countries.
3.
Without prejudice to point (b) of paragraph 1, point (a) of paragraph 1 shall not apply until 21 November 2014, for countries which by 20 November 2012 have initialled a bilateral preferential market access agreement with the Union, which provides the same tariff preferences as the scheme, or better, for substantially all trade, but which is not yet applied.
Article 5
1.
A list of GSP beneficiary countries meeting the criteria laid down in Article 4 is established in Annex II.
2.
By 1 January of each year following the entry into force of this Regulation the Commission shall review Annex II. To provide a GSP beneficiary country and economic operators with time for orderly adaptation to the change in the country’s status under the scheme:
(a)
the decision to remove a beneficiary country from the list of GSP beneficiary countries, in accordance with paragraph 3 of this Article and on the basis of point (a) of Article 4(1), shall apply as from one year after the date of entry into force of that decision;
(b)
the decision to remove a beneficiary country from the list of GSP beneficiary countries, in accordance with paragraph 3 of this Article and on the basis of point (b) of Article 4(1), shall apply as from two years after the date of application of a preferential market access arrangement.
3.
For the purposes of paragraphs 1 and 2 of this Article the Commission shall be empowered to adopt delegated acts, in accordance with Article 36, to amend Annex II on the basis of the criteria laid down in Article 4.
4.
The Commission shall notify the GSP beneficiary country concerned of any changes in its status under the scheme.
Article 6
1.
The products included in the general arrangement referred to in point (a) of Article 1(2) are listed in Annex V.
2.
The Commission shall be empowered to adopt delegated acts in accordance with Article 36, to amend Annex V in order to incorporate changes made necessary by amendments to the Combined Nomenclature.
Article 7
1.
Common Customs Tariff duties on products listed in Annex V as non-sensitive products shall be suspended entirely, except for agricultural components.
2.
Common Customs Tariff ad valorem duties on products listed in Annex V as sensitive products shall be reduced by 3,5 percentage points. For products under GSP sections S-11a and S-11b of Annex V, this reduction shall be 20 %.
3.
Where preferential duty rates calculated, in accordance with Article 6 of Regulation (EC) No 732/2008, on the Common Customs Tariff ad valorem duties applicable on the date of entry into force of this Regulation provide for a tariff reduction of more than 3,5 percentage points for the products referred to in paragraph 2 of this Article, those preferential duty rates shall apply.
4.
Common Customs Tariff specific duties, other than minimum or maximum duties, on products listed in Annex V as sensitive products shall be reduced by 30 %.
5.
Where Common Customs Tariff duties on products listed in Annex V as sensitive products include ad valorem duties and specific duties, the specific duties shall not be reduced.
6.
Where duties reduced in accordance with paragraphs 2 and 4 specify a maximum duty, that maximum duty shall not be reduced. Where such duties specify a minimum duty, that minimum duty shall not apply.
Article 8
1.
The tariff preferences referred to in Article 7 shall be suspended, in respect of products of a GSP section originating in a GSP beneficiary country, when the average value of Union imports of such products over three consecutive years from that GSP beneficiary country exceeds the thresholds listed in Annex VI. The thresholds shall be calculated as a percentage of the total value of Union imports of the same products from all GSP beneficiary countries.
2.
Prior to the application of the tariff preferences provided for in this Regulation, the Commission shall adopt an implementing act establishing, in accordance with the advisory procedure referred to in Article 39(2), a list of GSP sections for which the tariff preferences referred to in Article 7 are suspended in respect of a GSP beneficiary country. That implementing act shall apply as from 1 January 2014.
3.
The Commission shall, every three years, review the list referred to in paragraph 2 of this Article and adopt an implementing act, in accordance with the advisory procedure referred to in Article 39(2), in order to suspend or to re-establish the tariff preferences referred to in Article 7. That implementing act shall apply as of 1 January of the year following its entry in force.
4.
The list referred to in paragraphs 2 and 3 of this Article shall be established on the basis of the data available on 1 September of the year in which the review is conducted and of the two years preceding the review year. It shall take into account imports from GSP beneficiary countries listed in Annex II as applicable at that time. However, the value of imports from GSP beneficiary countries, which upon the date of application of the suspension, no longer benefit from the tariff preferences under point (b) of Article 4(1) shall not be taken into account.
5.
The Commission shall notify the country concerned of the implementing act adopted in accordance with paragraphs 2 and 3.
6.
Where Annex II is amended in accordance with the criteria laid down in Article 4, the Commission shall be empowered to adopt delegated acts in accordance with Article 36 to amend Annex VI in order to adjust the modalities listed in that Annex so as to maintain proportionally the same weight of the graduated product sections as defined in paragraph 1 of this Article.