Chapter II-Exports SECTION 18 Until the provisions of the exchange regulations of the various member States which concern foreign exchange left at the disposal of exporters are made uniform, special measures must be applied in order that the elimination of customs duties and quantitative restrictions among member States shall not cause certain of these States to be deprived of the proceeds in the foreign exchange of third countries earned by the exports of their enterprises. In application of this principle, the member States agree to apply their own exchange regulations in such a way as to permit coal and steel exporters to utilize foreign exchange earnings only to the extent permitted under the exchange regulations of the member State on whose territory the product in question originated. The High Authority shall be empowered to see to the application of such measures by addressing recommendations to the governments after consultation with the Council. SECTION 19 If the High Authority should find that, by substituting re-exports for direct exports, the creation of the common market results in a shift in the pattern of trade with third countries which causes substantial harm to one of the member States, it may, at the request of the government concerned, require the producers in such State to insert a destination clause in their sales contracts. Chapter III-Exception to the Most-Favored-Nation Clause SECTION 20 With regard to those countries benefiting from the most-favorednation clause through the application of Article 1 of the General Agreement on Tariffs and Trade, the member States shall take joint action towards the Contracting Parties to the above-mentioned Agreement in order to exempt the provisions of the present Treaty from the application of the article in question. If necessary, a special session of the Contracting Parties to the G.A.T.T. shall be requested for this purpose. As concerns those countries which, while not parties to the General Agreement on Tariffs and Trade, nevertheless benefit from the mostfavored-nation clause by virtue of bilateral agreements in effect, negotiations shall be undertaken upon the signature of the Treaty. In the absence of consent on the part of the interested countries, such commitments shall be modified or denounced in accordance with the terms thereof. Should a country refuse its consent to the member States or to any one of them, the other member States agree to lend effective assistance, which may even extend to denunciation by all of the member States of the agreements concluded with the country in question. Chapter IV-Liberalization of Trade SECTION 21 The member States of the Community recognize that they constitute a special customs system in the sense of Article 5 of the Organization for European Economic Cooperation's Trade Liberalization Code as it stands on the date of signature of the Treaty. They therefore agree to make the necessary notification to the Organization. Chapter V-Special Provision SECTION 22 Without prejudice to the expiration of the transition period, coal and steel trade between the Federal Republic of Germany and the Russian Zone of Occupation shall be regulated by the Government of the Federal Republic in agreement with the High Authority. PART THREE-GENERAL PRECAUTIONARY MEASURES Chapter I-General Provisions SECTION 23-READAPTATION 1. If the consequences of the establishment of the single market should oblige certain enterprises or parts of enterprises to cease or to modify their activity during the transition period defined in Section 1 of the present Convention, the High Authority, at the request of the interested governments and under the conditions specified below, shall furnish assistance in order to protect the workers from the burdens of readaptation and assure them a productive employment, and may grant non-reimbursable assistance to certain enterprises. sub 2. At the request of the interested governments and under the conditions defined in Article 46, the High Authority shall participate in a study of the possibilities of reemployment for unemployed workers either in existing enterprises or through the creation of new activities. 3. According to the procedure specified in Article 54, the High Authority shall facilitate the financing of approved programs mitted by the interested governments for the transformation of enterprises or for the creation, either in the industries coming under its jurisdiction or, with the concurrence of the Council, in any other industry, of new, economically sound activities capable of providing a productive employment for workers who have been released. Subject to the concurrence of the government concerned, the High Authority shall give preference in granting such facilities to the programs submitted by enterprises which have been obliged to cease their activity on account of the establishment of the common market. 4. The High Authority shall grant non-reimbursable assistance for the following purposes: (a) to contribute, in case of total or partial closing of enter prises, to the payment of allowances to tide the workers over (b) to contribute, by means of allotments to enterprises, to (c) to contribute to the payment of allowances to workers for reinstallation expenses; (d) to contribute to the financing of technical retraining for workers obliged to change employment. 5. The High Authority may also grant non-reimbursable assistance to enterprises obliged to cease their activity on account of establishment of the single market, provided that the sole and direct cause of this situation is the limitation of the single market to the coal and steel industries, and that this situation leads to a relative increase of production in other enterprises of the Community. Such assistance shall be limited to the amount necessary to enable the enterprises to meet payments which are due immediately. Any request for such assistance shall be submitted by the enterprise concerned through the intermediary of its respective government. The High Authority shall have the right to refuse assistance to any enterprise which shall have failed to inform its government and the High Authority of the development of a situation which might lead it to cease or modify its activity. 6. The High Authority shall subject the granting of non-reimbursable assistance under the terms of paragraphs 4 and 5 above to the payment by the State concerned of a special contribution at least equal to the amount of such assistance, except where otherwise provided by a decision of the Council adopted by a two-thirds majority. 7. The methods of financing specified for the application of Article 56 apply to the present section. 8. Interested parties may benefit from the provisions of the present section during the two years following the expiration of the transition period upon decision of the High Authority taken with the concurrence of the Council. Chapter II-Special Provisions for Coal SECTION 24 It is recognized that precautionary mechanisms are necessary during the transition period to avoid sudden and harmful shifts in production. These precautionary mechanisms should take into account the situations existing at the time the common market is created. Furthermore, if it should appear that harmful and abrupt price increases might occur in one or more regions, precautions should be taken to avoid such effects. To cope with these problems during the transition period the High Authority shall where necessary authorize under its supervision: (a) the application of the measures provided in Article 60, Section 2, subparagraph (b), as well as of zonal prices in cases not covered by the Chapter V of Title Three; (b) the maintenance or establishment of national compensation funds or mechanisms, financed by a levy on the national production, without prejudice to the exceptional resources described below. SECTION 25 The High Authority shall establish a perequation levy per ton of coal sold, which shall represent a uniform percentage of producers' receipts, on the coal production of those countries where average costs are less than the weighted average of the Community. The ceiling on the perequation levy shall be 1.5% of such receipts during the first year of operation of the single market, and shall be reduced each year by 20% of the initial ceiling. On the basis of such needs as it recognizes to exist under Sections 26 and 27 below and excluding the special charges which might arise from exports to third countries, the High Authority shall periodically fix the amount of the levy to be effectively imposed, and of the governmental subsidies to accompany it, in accordance with the following rules: (1) within the limit of the ceiling defined above, it shall calculate the amount of the levy to be imposed in such a way that governmental subsidies actually paid shall be at least equal to the amount of the levy; (2) it shall fix the maximum authorized amount of the governmental subsidies, on the understanding that: the governments may grant subsidies up to this amount, but shall not be required to do so; the assistance received from abroad can in no case exceed the amount of the subsidy actually paid. Additional charges resulting from exports to third countries shall not enter into the calculation of the necessary perequation payments or into the appreciation of the subsidies to accompany this levy. SECTION 26-BELGIUM 1. It is agreed that net Belgian coal production: shall not have to bear an annual reduction of more than 3 percent as compared with the preceding year, if the total production of the Community is the same as or greater than that during the preceding year; or shall not be less than Belgian production during the preceding year diminished by 3 percent, the figure thus obtained being further reduced by the coefficient of reduction applicable to the total production of the Community as compared with the preceding year.1 1 EXAMPLE.-In 1952-total production of the Community, 250 million tons; total Belgian production 30 million tons. In 1953-total production of the Community, 225 million tons. The coefficient of reduction is thus 0.9. Belgian production in 1953 should not be less than 30X0.97X0.9-26.19 million tons. 900,000 tons of this cut in production represents a permanent shift, and the balance, 2,910,000 tons, results from the economic situation. (Footnote in original) The High Authority, responsible for the regular and stable supply of the Community, shall establish long-term forecasts of production and marketing and, after consulting the Consultative Committee and the Council, shall address to the Belgian Government recommendations setting forth the shifts in production it deems possible on the basis of such forecasts. This procedure shall continue as long as the Belgian market remains apart from the common market under the provisions of paragraph 3 below. With the agreement of the High Authority, the Belgian Government shall decide what steps are to be taken in order to bring about such production shifts within the limits specified above. 2. Perequation is designed, from the beginning of the transition period: (a) to make it possible to lower the price of Belgian coal to all consumers of such coal in the common market to the vicinity of the forecast costs of production of such coal at the end of the transition period, with a view to bringing it as close as possible to the common market price. The price list established on this basis cannot be changed without the High Authority's approval. (b) to insure that the Belgian steel industry shall not be prevented by the special system for Belgian coal from joining the common market for steel, and consequently to lower its prices to the level practised on this market. The High Authority shall periodically fix the amount of the additional compensation for Belgian coal delivered to the Belgian steel industry which it deems necessary for the above purpose, taking into account all elements which affect the operations of this industry. In doing so, the High Authority shall ensure that such compensation does not have harmful effects on the steel industries of neighboring countries. Furthermore, in view of the provisions of sub-paragraph (a) above, such compensation should in no case lead to a reduction in the price of the coke used by the Belgian steel industry below the delivered price which it could obtain if it were supplied with Ruhr coke. (c) to grant an additional compensation for such exports of Belgian coal within the common market as the High Authority may determine to be necessary in view of the outlook for production and requirements in the Community as a whole; such compensation shall correspond to 80 percent of the difference, determined by the High Authority, between the delivered price (F.O.B. plus transport) of Belgian coal and the delivered price of coal from other countries of the Community. 3. Notwithstanding the provisions of Section 9 of the present Convention, the Belgian Government may maintain or establish, under the control of the High Authority, mechanisms making possible the separation of the Belgian market from the common market. Imports of coal from third countries shall be subject to the approval of the High Authority. 415900-57- -73 |