The EU Council and Parliament negotiators have reached a provisional agreement on the revised Generalised Scheme of Preferences (GSP) regulation that grants EU trade preferences to developing countries.
For the EU presidency, Denmark’s Foreign Affairs Minister welcomed the agreement, which he said strengthened the EU’s “support to developing countries through trade and preferential access to the single market …. At the same time, we make it clear that these trade benefits must be linked to the respect for human rights, good governance, environmental protection and – for the first time – cooperation on return of own nationals illegally present in EU.”
The EU’s generalised scheme of preferences (GSP) is a trade policy that offers vulnerable developing countries and territories preferential access to the EU market through reduced or zero tariffs on their exports.
The revised framework maintains the three main strands of support of the current scheme, Standard GSP, GSP+ and EBA, with improvements such as:
- international conventions: more international conventions on human and labour rights will need to be respected in order to be a GSP beneficiary. The proposal provides for an urgency procedure for the rapid withdrawal of preferences in case of violations of the principles of these conventions
- greener GSP: possible withdrawal of GSP benefits in case of serious and systematic violations of the principles of the conventions on climate change and environmental protection
- poorest countries transition: countries that will stop being considered as least developed countries (LDCs) in the next decade, and therefore receiving the broadest EU’s support from GSP’s EBA arrangement, will still be able to benefit from generous tariff preferences via GSP+ support if they commit to strong sustainability standards
- graduation thresholds: the share of imports in a specific sector beyond which a Standard GSP country temporary loses preferences will be lowered by 10% (from 57% currently to 47%). The objective is to focus better on preferences on less competitive products and create more opportunities for other GSP beneficiaries, in particular the LDCs
- rules of origin: the revision introduces a specific process to ensure that the cumulation of rules of origin responds to the requesting country’s development, financing and trade needs
- transparency: the new rules improve the monitoring and implementation of GSP+ commitments, for instance, through increased transparency and participation of the relevant stakeholders
The co-legislators agreed that GSP preferences may be withdrawn if a beneficiary country does not co-operate with the EU on the readmission of their own nationals.
The agreement includes provisions for reintroducing duties in case of sudden and significant rises in imports from a beneficiary country to protect Union producers.
A specific automatic safeguard mechanism for rice imports has been introduced, using a tariff rate quota (TRQ) system. Under this mechanism, in the event of an significant surge of rice imports above historical average imports to the EU, these imports will be subject to MFN (most favoured nation) tariffs for a specific period to prevent serious disturbances to the EU rice market.
The provisional agreement will now be endorsed by the Council and the Parliament, before being formally adopted. The legislation will apply from 1 January 2027.
