. /.WORLD TRADE
ORGANIZATIONG/TMB/N/444/Add.2
26 July 2002
(02-4144)
Textiles Monitoring Body Original:  English
AGREEMENT ON TEXTILES AND CLOTHING
Notification under Article 2.17
EUROPEAN COMMUNITY
Administrative Arrangements with China
Addendum
The Textiles Monitoring Body has received a further notification from the European
Community pursuant to Article 2.17.  The TMB is circulating this notification to WTO Members for
their information.G/TMB/N/444/Add.2
Page 2
European Commission
Permanent Delegation
to the International Organizations in Geneva
Head of Delegation
Geneva, 22 July 2002
Subject: China – TMB
EC clarifications on the so-called industry reserve provisions applicable to
China
Dear Mr. Szepesi,
With reference to your letter (TMB/100) of 2 July concerning the so-called industry reserve
quotas operating in accordance with the Commun ity's agreement with China and which were
discussed during the June meeting of the TMB let me provide you with some clarifications as to the
modalities and the modus operandi  of these provisions.
As you rightly point out, the pertinent provisions as notified to the TMB clearly spell out the
reserve period of 180 days for the categories 5, 6, 7, 8 15 and 26, whereas Appendix A to Annex 1,part 1 of G/TMB/N/60/Add.5 does not contain any reference to the reserve period of 115 days for
categories 2 and 3.
At the June meeting of the TMB, it was specified that the 115 day period during which a
priority for industry users applies up to 50 per cent of the agreed quantities is clearly less constrainingon the exporting country than the 180 day period notified and may therefore be more favourable than
the general rule.  Further, this arrangement has been in operation since the original textiles agreement
between the Community and China was concluded and has in no way been contested by the exporting
country.  On the contrary it has been working to the mutual satisfaction of both parties concerned.
The fact that this 115 day period for the two categories does not appear in the official notification, to
which you draw attention, is in fact an oversight for which I do apologize.  In this connection, I wish
to point out that it was the exporting country, China, which quite correctly drew attention to thedetails of this arrangement without by the way in any way contesting its existence.
Hoping that these clarifications are of a nature to dispel any misunderstandings on this
question, I ask you to accept Mr. Szepesi, the assurances of my highest consideration.
(Signed)
Carlo Trojan
Ambassador
Mr. András Szepesi
Chairman – Textiles Monitoring Body
World Trade Organization
Centre William Rappard
Rue de Lausanne 1541211 Geneva 21
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