Changes from report parliamentary committee draft to plenary report

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council on applying a generalised scheme of tariff preferences and repealing Regulation (EU) No 978/2012 of the European Parliament and of the Council

Changed(COM(2021)0579 – C9978/2012 –C9-0364/2021– 2021/0297(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2021)0579),

Changed– having regard to Article 207294(2) and Article 207(1) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C9-0364/2021),

Change 1

Addedhaving regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to Rule 59 of its Rules of Procedure,

Changed– having regard to the opinions of the Committee on developmentForeign Affairs and Subcommitteethe onCommittee Humanon RightsDevelopment,

Changed– having regard to the report of the Committee on International Trade (A90000/2021),(A9-0147/2022),

1. Adopts its position at first reading hereinafter set out;

2. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Change 2

ChangedRecital 2: (2) The external action of the Union is guided by the principles and objectives laid down in Article 21 of the Treaty on European Union.TheUnion. The Union seeks to advance those principles and objectives in its relations with third countries. All actions and measures taken by the Union at the international level should therefore be considered, designed and implemented with a view to ensuring a coherent approach towards partner countries, and reinforcing the relevance and strength of the impact of Union's external action. For that purpose, the Union should ensure that its commercial policy is conducted in close coordination with other external policies, and that regular contact with partner countries foreseen in the framework of the various instruments of the external action duly follow up on the obligations and issues identified in the implementation of the Union's trade relations and trade-related instruments. The GSP covers more than 60 countries and 2 billion people in the world and represents one of the key instruments of the Union commercial policy to promote human rights, sustainable development and good governance.

Change 3

ChangedRecital 5: (5) The general objectives of the GSP are to support eradication of poverty in all its forms, in line with Agenda 2030 and Sustainable Development Goal 17.12 and to17.12,to promote the sustainable development agenda,agenda and to encourage exports diversification from GSP beneficiary countries, while averting harm to EU industry’s interests. The GSP has also created benefit to the EU businesses. The 2018 GSP Mid-term Evaluation and the 2021 supporting Study for the Impact Assessment underpinning this Regulation concluded that the GSP framework under Regulation (EU) No 978/2012 has delivered in part on these main objectives, which were at the core of the 2012 overhaul of Council Regulation (EC) No 732/200815.732/2008, together with a lack of progress on democracy and human rights.

Change 4

ChangedRecital 6: (6) Those objectives remain relevant in the current global context and they are consistent with the analysis and perspective of the recent Commission Communication Trade Policy Review “An Open, Sustainable and Assertive Trade Policy”16Policy” (‘TPR’). According to the TPR, the Union has a “strategic interest to support the enhanced integration into the world economy of vulnerable developing countries” and it “must fully use the strength provided by its openness and the attractiveness of its Single Market” to support multilateralism and to ensure adherence to universal values. For GSP specifically, the TPR notes its important role in “promoting respect for core human and labour rights” and sets the objective for the GSP “to further increase trading opportunities for developing countries to reduce poverty and create jobs based on international values and principles”. Strengthening the tools to foster the positive conditionality in relation to the international conventions, as well as pro-actively encouraging the beneficiary countries to ratify those conventions, are therefore essential elements to make sure that the additional trading opportunities provided by the GSP support to the development of the beneficiary countries in a sustainable manner. Moreover,By thefocusing schemein shouldparticular assiston beneficiariesthe inless recoveringcompetitive fromproducts, the COVID-19 impactfavourable andtariff inregime re-buildingunder theirthe economiesscheme inshould aalso sustainablesupport manner,EU includingGSP withbeneficiary respectcountries to internationaldevelop humana rights,solid labour,industrial environmentalbase andto goodfoster governancediversification …of trade flows. Moreover, t…

Change 5

ChangedRecital 7: (7) By providing preferential access to the Union market, the scheme should assist developing countries in their efforts to reduce poverty and achieve and promote good governance and sustainable development by helping them to generate additional revenue through international trade, which can then be re-invested for the benefit of their own sustainable development and, in addition, to diversify their economies.economies, productions and exports. The scheme's tariff preferences should focus on those developing countries that have greater development, trade and financial needs.needs and support in particular opportunities for less competitive products. In doing so, the scheme would support developing countries’ transition towards upper-middle income status.

Change 6

ChangedRecital 7 a (new): (7a) The Union has set ambitious goals to promote sustainable development in its human, social, economic and environmental dimensions, notably through the European Green Deal, the Circular Economy Action Plan, the Farm to Fork Strategy, or in the areas of sustainable corporate governance and de-forestation, which will trigger fundamental changes in trade patterns with relevant impacts on the GSP scheme during the next decade. The GSP should play an important role in promoting tradetrade, compatible with WTO rules, in sustainably-produced goodsgoods, and targeted development and technical assistance should be designed and provided in order to ensure that beneficiary countries can also fully take part in sustainable trade.

Recital 7 b (new): (7b) Gender equality in all Union policies is firmly established in Article 8 of the TFEU and is also at the core of the UN's Agenda 2030, as enshrined in SDG 5, however trade and investment agreements tend to affect women and men differently on account of structural gender inequalities. The GSP scheme has the potential of positively contributing to female employment and empowerment. The most prominent product sections under the three EU's GSP arrangements are textile and apparel articles, accounting for up to 80% of the preferential imports under the EBA arrangement, whereas more than 80% of the world’s 60 million garment factory workers are female.

Recital 8: (8) The scheme should consist of a basic arrangement (‘standard GSP arrangement’), and two special arrangements, namely the ‘special incentive arrangement for sustainable development and good governance – GSP+’ and the ‘special arrangement for the least-developed countries - EBA’. It, therefore, continues the structure of the previous ten years, as it focuses on the countries most in need and addresses the varying developmental needs of beneficiaries, which should also include their regional integration processes. The scheme should apply to the entirety of the territory of beneficiary countries, including to special economic zones and export processing zones.

Change 7

ChangedRecital 9: (9) The standard GSP arrangement should be granted to all those developing countries which share a common development need and are in a similar stage of economic development.development Additionally,and thiswhich arrangementhave shouldcommitted notto besigning appliedand inratifying the eventinternational conventions listed in Annex VI. If those countries fail to ratify the international conventions that are covered by this Regulation within five years from the application of the trade preferences.preferences, the scheme should be suspended. There is no definition of ‘developing country’ at the level of the WTO, and it is left to preference granting countries to determine the list of GSP-eligible developing countries. Countries which have successfully completed their transition from centralised to market economies, and are today powerful economies with a strong position in international trade, such as China, Hong Kong, Macao and Russia, should not be considered as developing countries in the context of the GSP, and should, therefore, be removed from the list of eligible countries. Countries which are classified by the World Bank as high-income or upper-middle income countries have per capita income levels allowing them to attain higher levels of diversification without the scheme's tariff preferences. They are at a different stage of economic development and do not, therefore, share the same development, trade and financial needs as lower income or more vulnerable developing countries. In order to prevent unjustified discrimination, they need to be treated differently; therefore, they do not benefit from the standard …d…

Change 8

ChangedRecital 11: (11) The special incentive arrangement for sustainable development and good governance (GSP+) is based on the integral concept of sustainable development, as recognised by international conventions and instruments such as the 1986 UN Declaration on the Right to Development, the 1992 Rio Declaration on Environment and Development, the 1998 International Labour Organisation (ILO) Declaration on Fundamental Principles and Rights at Work, the 2000 UN Millennium Declaration, the 2002 Johannesburg Declaration on Sustainable Development, the ILO Centenary Declaration for the Future of Work of 2019, the Outcome Document of the UN Summit on Sustainable Development of 2015 "Transforming Our World: the 2030 Agenda for Sustainable Development", the UN Guiding Principles on Business and Human Rights, and the Paris Agreement on Climate Change under the UN Framework Convention on Climate Change. Consequently, the additional tariff preferences provided for under the special incentive arrangement for sustainable development and good governance should be granted to those developing countries which, due to a lack of diversification, are economically vulnerable, have ratified and started implementing core international conventions on human and labour rights, climate and environmental protection and good governance, commit to ensuring the effective implementation and to collaborate on the monitoring thereof. The special incentive arrangement for sustainable development and good governance should help those countries to a……

Change 9

RemovedRecital 12: (12) Countries graduating from the Least-Developed Countries (LDC) category established by the UN should be incentivised to continue on the path of sustainable development. For this purpose, the economic vulnerability criteria to qualify for the special incentive arrangement for sustainable development and good governance should be eased compared to Regulation (EU) No 978/2012, to facilitate access by a larger number of countries graduating from the least developed country category. The continued and sustained progress towards ratifying the international conventions covered by this Regulation should be closely monitored, and EU development finance programming should be designed to duly take this objective into consideration.

AddedArticle 11 a (new): (11a) The Union has set ambitious goals to promote sustainable development in its human, social, economic and environmental dimensions, notably through the European Green Deal, the Circular Economy Action Plan, the Farm to Fork Strategy, or in the areas of sustainable corporate due diligence and de-forestation, which will trigger fundamental changes in trade patterns with relevant impacts on the GSP scheme during the next decade. The implementation of the generalized scheme of tariff preferences should integrate the current discussions on EU initiatives, which will entail for Union products and products imported into the Union from third countries significantly increased environmental, social and health production standards.

RemovedRecital 13: (13) Preferences should be designed to promote further economic growth and, thereby, to respond positively to the need for sustainable development. Targeted EU aid for trade and development finance, including blended finance and guarantees, should be provided accordingly, to help promote sustainable trade and investment towards production capacity, diversification and value addition, in particular by lower-income countries. Under the special incentive arrangement for sustainable development and good governance, the ad valorem tariffs should, therefore, be suspended for the beneficiary countries concerned. The specific duties should also be suspended, unless combined with an ad valorem duty.

AddedArticle 11 b (new): (11b) The EU should engage with beneficiary countries, on a common understanding and in a continuous and cooperative manner, to help them reach and implement international, social, human, and environmental standards, while taking into account the countries’ level of development.

RemovedRecital 15: (15) Countries that have been granted the special incentive arrangement for sustainable development and good governance in accordance with Regulation (EU) No 978/2012 should submit a new application within two years after the date of application of this Regulation. In order, however, to ensure continuity and legal certainty for economic operators, the tariff preferences under the special incentive arrangement for sustainable development and good governance provided for in Regulation (EU) No 978/2012 are to be maintained during the period in which their application is assessed. The Union should agree, as much as possible, to request technical and financial assistance from applicant countries related to the ratification and implementation of the conventions

AddedArticle 11 c (new): (11c) By putting more emphasis on the effective implementation of the core international conventions referred to in Annex VI, and as a measure of positive transformation, the scheme should contribute to this objective and facilitate the socio-economic and environmental conditions needed to progressively achieve reciprocity in production standards by the beneficiary countries in the long term.

RemovedRecital 15 a (new): (15a) The application for the special incentive arrangement for sustainable development should comprise, among others, a public plan of action detailing priority-oriented list of measures to be taken which are considered necessary to effectively implement the relevant international conventions. This plan of action, on which the beneficiary country should have reached a common understanding with the Commission and where appropriate the European External Action Service, should also include deadlines and identify the relevant bodies of the beneficiary country responsible for its implementation.

AddedRecital 12: (12) Countries graduating from the Least-Developed Countries (LDC) category established by the UN should be incentivised to continue on the path of sustainable development. For this purpose, the economic vulnerability criteria to qualify for the special incentive arrangement for sustainable development and good governance should be eased compared to Regulation (EU) No 978/2012, to facilitate access by a larger number of countries graduating from the least developed country category. The continued and sustained progress towards ratifying the international conventions covered by this Regulation should be closely monitored by the Commission, and EU development finance programming should be designed to duly take this objective into consideration.

RemovedRecital 16: (16) The Commission and where appropriate the European External Action Service should monitor the status of ratification of the international conventions on human and labour rights, environmental protection and good governance and their effective implementation, by assessing in a transparent manner the progress made in the implementation of the plan of action, examining the relevant information, in particular where available the conclusions and recommendations of the relevant monitoring bodies established under those conventions. This monitoring should also be based on high-level missions on the ground. Every three years, the Commission should present to the European Parliament and the Council a report on the status of ratification of the respective conventions, the compliance of the beneficiary countries with any reporting obligations under those conventions, and the status of the implementation of the conventions in practice, notably on the basis of the implementation of the plan of action. In their conclusions on the monitoring, the Commission and, where appropriate, the European External Action Service should provide clear recommendations on issues and actions to be prioritised for the following period.

AddedRecital 13: (13) Preferences should be designed to promote further sustainable growth and, thereby, to respond positively to the need for sustainable development. Targeted EU aid for trade and development finance, including blended finance and guarantees, should be provided accordingly, to help promote sustainable trade and investment towards production capacity, diversification and value addition, in particular by lower-income countries. Under the special incentive arrangement for sustainable development and good governance, the ad valorem tariffs should, therefore, be suspended for the beneficiary countries concerned. The specific duties should also be suspended, unless combined with an ad valorem duty.

AddedRecital 15: (15) Countries that have been granted the special incentive arrangement for sustainable development and good governance in accordance with Regulation (EU) No 978/2012 should submit a new application within two years after the date of application of this Regulation. In order, however, to ensure continuity and legal certainty for economic operators, the tariff preferences under the special incentive arrangement for sustainable development and good governance provided for in Regulation (EU) No 978/2012 are to be maintained during the period in which their application is assessed. The Union should agree, as much as possible, to provide technical and financial assistance for applicant countries related to the ratification and implementation of the conventions. The continued and sustained progress towards ratifying and implementing the core international conventions should be closely monitored, and EU technical and financial assistance should be designed to duly take this objective into consideration.

AddedRecital 15 a (new): (15a) The application for the special incentive arrangement for sustainable development should comprise, among others, a public forward-looking plan of action detailing priority-oriented list of measures to be taken which are considered necessary to effectively implement the relevant international conventions. These measures should constitute the benchmarks for the progressive suspension of tariffs and be listed in a tariff suspension schedule, included to the plan of action. This plan of action, on which the beneficiary country should have reached a common understanding with the Commission and where appropriate the European External Action Service, should also include timeframes and identify the relevant bodies of the beneficiary country responsible for its implementation. The validity of the plans of action is subjected to the duration of this Regulation.

AddedRecital 16: (16) The Commission and where appropriate the European External Action Service should monitor the status of ratification of the international conventions on human and labour rights, environmental protection and good governance and their effective implementation, by assessing in a transparent manner the progress made in the implementation of the plan of action, examining the relevant information, in particular where available the conclusions and recommendations of the relevant monitoring bodies established under those conventions. This monitoring should also be based on high-level missions on the ground. In the framework of such missions, relevant stakeholders, including civil-society organisations and human rights defenders in the beneficiary countries should be consulted. Every three years, the Commission should present to the European Parliament and the Council a report on the status of ratification of the respective conventions, the compliance of the beneficiary countries with any reporting obligations under those conventions, and the status of the implementation of the conventions in practice, notably on the basis of the implementation of the plan of action. In their conclusions on the monitoring, the Commission and, where appropriate, the European External Action Service should provide clear recommendations on issues and actions to be prioritised for the following period.

Recital 16 a (new): (16a) EU Delegations in beneficiary countries should play a crucial role in the overall implementation of this Regulation. EU Delegations should set up focal points ensuring coordination among the several tools in support of the beneficiary country to implement the requirements of this Regulation.

Change 10

ChangedRecital 16 b (new): (16b) The civil society and other relevant stakeholders should be consulted throughout the monitoring cycle,cycle based on public procedures and deadlines, and the information they submit should be duly taken into account. Additionally, an advisory body composed of their representatives should be set up, to assist the Commission in reviewing, monitoring and assessing the progress made by the beneficiary countries.

Change 11

RemovedRecital 17: (17) For the purposes of monitoring of implementation and, where applicable, withdrawal of tariff preferences, reports from relevant monitoring bodies are essential. However, such reports may be, to the widest possible extent, supplemented by other information available, including information obtained under bilateral or multilateral technical assistance programmes, and through other sources of information, provided they are accurate and reliable. This could include information from the Union institutions, bodies, offices or agencies, governments, international organisations, civil society, social partners, representatives of the economic interests, or complaints received through the SEP provided they satisfy the relevant requirements. Shortcomings identified during the monitoring process should inform the Commission’s future programming of development assistance and the provision of technical assistance in a more targeted manner.

AddedRecital 16 c (new): (16c) The Commission should promote a strong sustainable development dimension in global value chains, in line with the due diligence obligations set out in the United Nations Guiding Principles on Business and Human Rights.

RemovedRecital 18: (18) In July 2020, the Commission appointed the Chief Trade Enforcement Officer with the role of enforcing trade rules. In this connection, in November 2020, the Commission launched a new complaints mechanism, the Single Entry Point (‘SEP’), as part of its increased efforts to strengthen the enforcement and implementation of trade commitments. Through the SEP, the Commission receives complaints on various matters related to trade policy, including breaches of the GSP commitments. The SEP is accessible to citizens, entities, stakeholders or civil society established in the EU or in the beneficiary countries and complaints may be submitted anonymously. Such new system of complaints should be integrated and formalised within the framework of this Regulation.

AddedRecital 17: (17) For the purposes of monitoring of implementation and, where applicable, subsequent granting or withdrawal of tariff preferences, reports from relevant monitoring bodies are essential. However, such reports may be, to the widest possible extent, supplemented by other information available, including information obtained under bilateral or multilateral technical assistance programmes, and through other sources of information, provided they are accurate and reliable. This could include information from the Union institutions, bodies, offices or agencies, governments, international organisations, civil society, social partners, representatives of the economic interests, or complaints received through the SEP provided they satisfy the relevant requirements. Shortcomings identified during the monitoring process should inform the Commission’s future programming of development assistance and the provision of technical assistance in a more targeted manner.

RemovedRecital 21: (21) Common Customs Tariff duties on non-sensitive products should continue to be suspended, while duties on sensitive products should enjoy a tariff reduction, in order to ensure a satisfactory utilisation rate while at the same time taking account of the situation of the corresponding Union industries. Recognising that economic development, social development, and environmental protection are interdependent and mutually supportive components of sustainable development, and aiming at further supporting the economic diversification of beneficiary countries, an additional tariff reduction should be granted to sensitive products certified as sustainable by the recognised voluntary sustainability standards based on the principles of the conventions listed in Annex VI.

AddedRecital 18: (18) In July 2020, the Commission appointed the Chief Trade Enforcement Officer with the role of enforcing trade rules. In this connection, in November 2020, the Commission launched a new complaints mechanism, the Single Entry Point (‘SEP’), as part of its increased efforts to strengthen the enforcement and implementation of trade commitments. Through the SEP, the Commission receives complaints on various matters related to trade policy, including breaches of the GSP commitments. The SEP is accessible to citizens, entities, trade unions, stakeholders, human rights defenders, and civil society established in the Union or in the beneficiary countries and the Commission should ensure the confidentiality of complaints including the identity of complainants and all relevant elements pertaining to the complaint. Such new system of complaints should be integrated and formalised within the framework of this Regulation.

RemovedRecital 22: (22) Tariff reductions should be sufficiently attractive, in order to motivate traders to make use of the opportunities offered by the scheme. Therefore, the ad valorem duties should generally be reduced by a flat rate of 3,5 percentage points from the 'most favoured nation' duty rate, while such duties for textiles and textile goods should be reduced by 20 %. Specific duties should be reduced by 30 %. For sensitive products certified by the recognised voluntary sustainability standards the ad valorem duties should be reduced by a flat rate of 4,5 percentage points from the 'most favoured nation' duty rate, while such duties for textiles and textile goods should be reduced by 30%. Specific duties should be reduced by 40%. Where a minimum duty is specified, that minimum duty should not apply.

AddedRecital 21: (21) Common Customs Tariff duties on non-sensitive products should continue to be suspended, while duties on sensitive products should enjoy a tariff reduction, in order to ensure a satisfactory utilisation rate and maximise the development effect while at the same time taking account of the situation of the corresponding Union industries.

RemovedRecital 24: (24) Product graduation should be based on criteria related to sections and chapters of the Common Customs Tariff. Product graduation should apply in respect of a section or sub-section in order to reduce cases where heterogeneous products are graduated. The graduation of a section or a sub-section (made up of chapters) for a beneficiary country should be applied when the section meets the criteria for graduation over three consecutive years, in order to increase predictability and fairness of graduation by eliminating the effect of large and exceptional variations in the import statistics. Product graduation should not apply to the beneficiary countries of the special incentive arrangement for sustainable development and good governance (GSP+) and the beneficiary countries of the special arrangement for the least-developed countries (EBA) as they share a very similar economic profile rendering them vulnerable because of a low, non-diversified export base. The tariff preferences provided for in this Regulation apply to products originating in the beneficiary countries in accordance with the rules of origin laid down in the Union Customs Code and the legal acts adopted in accordance with the powers conferred by that Code, in particular Commission Delegated Regulation (EU) 2015/244619. and Commission Implementing Regulation (EU) 2015/244720. Regional cumulation between countries of different regional groups and extended cumulation is an important instrument to support regional …

AddedRecital 22: (22) Tariff reductions should be sufficiently attractive, in order to motivate traders to make use of the opportunities offered by the scheme. Therefore, the ad valorem duties should generally be reduced by a flat rate of 3,5 percentage points from the 'most favoured nation' duty rate, while such duties for textiles and textile goods should be reduced by 20 %. Specific duties should be reduced by 30. Where a minimum duty is specified, that minimum duty should not apply.

RemovedRecital 25: (25) The reasons for temporary withdrawal of the arrangements under the scheme should include serious and systematic violations of the principles laid down in international conventions concerning core human rights (including certain principles of international humanitarian law enshrined in those conventions), labour rights, climate and environmental protection, and good governance, so as to promote the objectives of those conventions. Tariff preferences under the special incentive arrangement for sustainable development and good governance should be temporarily withdrawn if the beneficiary country does not respect its binding undertaking to maintain the ratification and effective implementation of those conventions or to comply with the reporting requirements imposed by the respective conventions, or to maintain the effective implementation of the plan of action provided in its request to benefit from the arrangement or if the beneficiary country does not cooperate with the Union's monitoring procedures as set out in this Regulation. The temporary withdrawal should continue until the reasons justifying it no longer apply. In situations characterised by an exceptional gravity of the violations, the Commission should have the power to respond rapidly by adopting measures within a shorter timeline. Under the Union’s zero tolerance approach for child labour the reasons for temporary withdrawal should include exports of goods made by internationally prohibited child labour, as wel…

AddedRecital 23 a (new): (23a) Safeguards are essential mechanisms to reduce beneficiary countries’ dependency on a few products, to focus preferences on less competitive products and to stimulate economic growth. The scheme should reinforce the Union’s financial and economic interests by providing effective and enforceable safeguards to sensitive products which should at the same time improve the diversification of their economies and the implementation of social and environmental rights in beneficiary countries.

RemovedRecital 25 a (new): (25a) Temporary withdrawal of the arrangements should be considered as a last-resort measure. Whenever the record of compliance with the relevant obligations set out in this Regulation seriously deteriorates, the Commission and the EEAS should step up dialogue with the beneficiary countries and launch a process of enhanced engagement where countries commit to actions through the implementation of targeted roadmaps leading to discernible progress generally in the short term or, whenever issues are more complex and sensitive, over the medium term. After the launch and during the overall duration of the withdrawal procedure, beneficiary countries should be given the possibility to start engaging anytime. Whenever the enhanced engagement is extended into a second year, the Commission should add the country onto a public list, with a view to providing predictability and maximising leverage.

AddedRecital 24: (24) Product graduation should be based on criteria related to sections and chapters of the Common Customs Tariff. Product graduation should apply in respect of a section or sub-section in order to reduce cases where heterogeneous products are graduated. The graduation of a section or a sub-section (made up of chapters) for a beneficiary country should be applied when the section meets the criteria for graduation over three consecutive years, in order to increase predictability and fairness of graduation by eliminating the effect of large and exceptional variations in the import statistics. Product graduation should not apply to the beneficiary countries of the special incentive arrangement for sustainable development and good governance (GSP+) and the beneficiary countries of the special arrangement for the least-developed countries (EBA) as they share a very similar economic profile rendering them vulnerable because of a low, non-diversified export base. The Commission should monitor, in cooperation with stakeholders and civil society, the development and export potential of beneficiary countries that could potentially reach the Upper Middle-Income Status. This monitoring should aim to improve the targeting of sensitive products under the product graduation mechanism, provide clear recommendations on actions to improve export diversification and ensure that tariff preferences under GSP are withdrawn from competitive products in order to provide further opportunities in the …

AddedBetter terms for regional cumulation should be encouraged (as outlined under recital24 and in article 33 (3)), as it will further enable GSP countries to develop their supply chains and become better integrated with the global economy. Thus, it is important that provisions on cumulation does not afford disproportionate requirements for GSP countries to cumulate their products with regional partners, as this would merely discourage investing into developing more advanced regional supply chains. The current wording asks GSP beneficiaries for"sufficient evidence that cumulation responds to its development, financing and trade needs". While it is not quite clear what this entails, the Commission should be encouraged to lower administrative burdens, and formal requirements, to an absolute minimum, to foster the best grounds for GSP partners to cumulate freely.

AddedRecital 25: (25) The reasons for temporary withdrawal of the arrangements under the scheme should include serious and systematic violations of the principles laid down in international conventions concerning core human rights (including certain principles of international humanitarian law enshrined in those conventions), labour rights, climate and environmental protection, and good governance, so as to promote the objectives of those conventions. In determining whether such serious and systematic violations exist, the Commission should take into account all available assessments, comments, decisions, recommendations and conclusions of the relevant monitoring bodies and substantiated concerns expressed by the European Parliament, the Council, international organisations, and civil society including trade unions, or acting upon a complaint. Tariff preferences under the special incentive arrangement for sustainable development and good governance should be temporarily withdrawn if the beneficiary country does not respect its binding undertaking to maintain the ratification and effective implementation of those conventions or to comply with the reporting requirements imposed by the respective conventions, or to maintain the effective implementation of the plan of action provided in its request to benefit from the arrangement or if the beneficiary country does not cooperate with the Union's monitoring procedures as set out in this Regulation. The temporary withdrawal should be used as a last …

AddedRecital 25 a (new): (25a) In determining whether there are systematic and serious violations the Commission should take into account the following non exhaustive list of situations: genocide; crimes against humanity; torture and other cruel, inhuman or degrading treatment or punishment; slavery or forced labour; extrajudicial, summary or arbitrary executions and killings; enforced disappearance of persons; arbitrary arrests or detentions; trafficking in human beings, including people-smuggling; sexual and gender-based violence; other violations of the laws and customs of war; violations or abuses of freedom of peaceful assembly and of association; violations or abuses of freedom of opinion and expression; violations or abuses of freedom of religion or belief; furthermore, the Commission should take into account failure to comply with obligations with regard to nationally determined contributions in the framework of the Paris Agreement on Climate Change

AddedRecital 25 b (new): (25b) Temporary withdrawal of the arrangements should be considered as a last-resort measure. Related decisions can be accompanied by an analysis of the socio-economic impact of the withdrawal with a view to minimising negative effects on the beneficiary country’s populations while maximising the leverage on its government. Whenever the record of compliance with the relevant obligations set out in this Regulation seriously deteriorates, the Commission and the EEAS should step up dialogue with the beneficiary countries and launch a process of enhanced engagement where countries commit to actions through the implementation of targeted roadmaps leading to discernible progress generally in the short term or, whenever issues are more complex and sensitive, over the medium term. After the launch and during the overall duration of the withdrawal procedure, beneficiary countries should be given the possibility to start engaging anytime. If the Commission considers that there is sufficient evidence that a beneficiary country is seriously and systematically violating the principles laid down in the conventions listed in Annex VI, it should immediately initiate the procedure for temporary withdrawal. Where violations are of exceptional gravity, the Commission should activate the rapid response mechanism. Whenever the enhanced engagement is extended into a second year, the Commission should add the country onto a public list, with a view to providing predictability and maximising leverag…

Recital 26: deleted

Change 12

AddedRecital 26 a (new): (26a) A more coordinated, holistic and structured approach to migration could bring important benefits to the countries of origin, transit and destination of migrants. A coordinated approach to migration is key to ensure that the benefits of migration accrue. Comprehensive partnerships should be built to address the root causes of forced migration and achieve the targets and objectives of the UN Sustainable Development Goals. This approach and relevant actions should be implemented in full respect of international law, including international human rights, humanitarian and refugee law, Union and national competences, and should be in line with principles enshrined in the Global Compacts on Refugees and on Safe, Orderly and Regular Migration. The Union should favour a constructive and mutually beneficial engagement on all aspects of migration, including mobility partnerships readmission and reintegration. Improving sustainable reintegration of returning migrants and their families, and monitoring thereof, including through capacity building would significantly strengthen mutually beneficial engagement with partner countries.

Recital 27: deleted

Change 13

RemovedRecital 31: (31) The advisory procedure should be used for the adoption of implementing acts on suspension from the tariff preferences of certain GSP sections in respect of beneficiary countries, on the initiation of a temporary withdrawal procedure, taking into account the nature and impact of those acts and on the establishment of a list of sustainability certification schemes that are relevant for the purpose of recognising products as sustainable.

AddedRecital 36: (36) The Commission should report regularly to the European Parliament and to the Council on the effects of the scheme under this Regulation through the relevant institutional committees. By 1 January 2029, the Commission should report to the European Parliament and to the Council on the mid-term application of this Regulation and assess the need to review the scheme. The report is necessary to analyse the impact of the scheme on the development, poverty eradication, economic diversification, trade and financial needs of beneficiaries, with special regard to be given to the product scope of the Regulation, including in relation to the issue of sustainable products, and to any relevant development concerning conditionalities, as well as on bilateral trade, the impact on EU producers, and on the Union's tariff income, with particular attention to the sustainable development goals.