EXCHANGE OF LETTERS relating to Article 2 (2) of the Additional Protocol and concerning imports into the Community of fresh cut flowers and flower buds falling within subheading 06.03 A of the Common Customs Tariff

A. Letter from the Community

Brussels, . . . . . .

Sir . . . . . . ,

Article 2 of the Additional Protocol provides for the phasing out of customs duties on imports into the Community of cut flowers and flower buds, fresh, falling within subheading 06.03 A of the Common Customs Tariff and originating in Israel, subject to a limit of 17 000 tonnes.

Israel undertakes to abide by the price levels laid down below for imports into the Community of roses and carnations which qualify for the phasing out of this tariff:

- the price level of imports into the Comunity must be at least equal to 85 % of the Community price level for the same products over the same periods,

- the Israeli price level shall be determined by recording the prices of the imported products, without deduction of import duties, on representative Community import markets,

- the Community price level shall be based on the producer prices recorded on representative markets of the main producer Member States,

- for both Community producer prices and the import prices of Israeli products a distinction shall be made between large-flowered and small-flowered roses and between unifloral and multifloral carnations,

- if, during two successive market days, the Israeli price level for any one type of product and for at least 30 % of the quantities imported into the Community for which price quotations are available is below 85 % of the Community price level, the tariff preference shall be suspended. The Community shall reinstate the tariff preference when an Israeli price level equal to 85 % or more of the Community price level is recorded during two successive market days or after six successive working days on which no price is available for products originating in Israel,

- should the Israeli price level fluctuate around 85 % of the Community price level during a period of from five to seven successive market days and fall below that level for three of those days, the tariff preference shall be suspended for a period of six days. However, the Community shall reinstate the preferential customs duty if the Israeli price level is found to be equal to 85 % or more of the Community price level on three successive market days.

Israel further undertakes to maintain the traditional breakdown of trade between roses and carnations.

Should the Community market be disturbed by a change in this breakdown, the Community reserves the right to determine the proportions in line with traditional trade patterns. In such cases, an appropriate exchange of views could take place.

I should be grateful if you would kindly inform me whether your government is in agreement with the above.

Please accept, Sir, the assurance of my highest consideration.

On behalf of the Council of the European Communities

B. Letter from the Israeli government

Sir . . . . . . ,

I have the honour to acknowledge receipt of your letter of today's date which reads as follows:

Article 2 of the Additional Protocol provides for the phasing out of customs duties on imports into the Community of cut flowers and flower buds, fresh, falling within subheading 06.03 A of the Common Customs Tariff and originating in Israel, subject to a limit of 17 000 tonnes.

Israel undertakes to abide by the price levels laid down below for imports into the Community of roses and carnations which qualify for the phasing out of this tariff:

- the price level of imports into the Community must be at least equal to 85 % of the Community price level for the same products over the same periods,

- the Israeli price level shall be determined by recording the prices of the imported products, without deduction of import duties, on representative Community import markets,

- the Community price level shall be based on the producer prices recorded in representative markets of the main producer Member States,

- for both Community producer prices and the import prices of Israeli products a distinction shall be made between large-flowered and small-flowered roses and between unifloral and multifloral carnations,

- if, during two successive market days, the Israeli price level for any one type of product and for at least 30 % of the quantities imported into the Community for which price quotations are available is below 85 % of the Community price level, the tariff preference shall be suspended. The Community shall reinstate the tariff preference when an Israeli price level equal to 85 % or more of the Community price level is recorded during two successive market days or after six successive working days on which no price is available for products originating in Israel,

- should the Israeli price level fluctuate around 85 % of the Community prive level during a period of from five to seven successive market days and fall below that level for three of those days, the tariff preference shall be suspended for a period of six days. However, the Community shall reinstate the preferential customs duty if the Israeli price level is found to be equal to 85 % or more of the Community price level on three successive market days.

Israel further undertakes to maintain the traditional breakdown of trade between roses and carnations.

Should the Community market be disturbed by a change in this breakdown, the Community reserves the right to determine the proportions in line with traditional trade patterns. In such cases, an appropriate exchange of views could take place.

I should be grateful if you would kindly inform me whether your government is in agreement with the above.

I have the honour to confirm that my government is in agreement with the contents of your letter.

Please accept, Sir, the assurance of my highest consideration.

For the Government of the State of Israel