Proposal for a Council Regulation amending Annex I to Regulation (EEC) No 2658/87 on the tariff and statistical nomenclature and on the Common Customs Tariff

The purpose of the attached proposal for a Regulation is the suspension of the autonomous common customs tariff duties on jet fuel, which is currently classified under CN code 2710 19 21. Currently, bilateral aviation agreements with third countries typically include provisions concerning duty relief to jet fuel. However, it is necessary to ensure, at European level, clarity and uniformity in this regard, thus providing legal certainty for operators as well as avoiding any distortion of competition resulting from differing approaches and rules.

The vast majority of jet fuel imports to the European Union (EU) originates in countries that benefit from the Generalised Scheme of Preferences (GSP) and are, thus, duty free. This has a significant importance for the EU air industry. Following the revision of the GSP scheme, regarding the preferences that will apply as of 1 January 2014, large exporting producers of jet fuel such as the Gulf Cooperation Council countries (GCC) will cease to be beneficiaries of this preferential access to the EU, whereas others (India), at least for the period 1 January 2014 to 31 December 2016 will not benefit from the GSP for some categories of products, including fuel.

The imposition of customs duties on jet fuel from those suppliers would likely have an abrupt impact on the price of jet fuel on the EU market in the absence of a diversification of the sourcing of jet fuel for the EU market. Moreover, refineries in the EU would not be able to increase production of aviation fuel to any significant degree at short notice, since this implies producing other derivative products, such as gasoline for which new exports opportunities would need to be explored. Both the EU air and oil industry sector therefore need time to adjust to the consequences of the graduation of these supplier countries from GSP status.

Taking into account possible future changes in the market situation, the suspension should be reviewed on the basis of proportionate assessment within five years. In the light of the foregoing it is proposed to amend Council Regulation (EEC) No 2658/87 accordingly.

• Primary Source

EUR-Lex: COM(2013)718: Follow the progress of this proposal through the decision-making procedure http://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2013:718:FIN

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