The EFTA States signed a Interim Agreement with the Palestinian Authority in Leukerbad, Switzerland, on 30 November 1998. The Agreement entered into force on 1 July 1999.
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Date of Signature of the Agreement Date of Entry Into Force Imports to EFTA States Exports from EFTA StatesThe Interim Agreement covers trade in industrial products as well as fish and marine products. In addition, bilateral agricultural agreements between the individual EFTA countries and the PLO for the Benefit of the Palestinian Authority have been concluded which form part of the instruments creating the free trade area.
Among the objectives of the Agreement (Article 1) are to promote, through the expansion of reciprocal trade, the harmonious development of economic relations between the Parties. As of 1 July 1999, virtually all customs duties on trade in industrial goods were eliminated. The Agreement includes provisions relating to the elimination of customs duties and other trade barriers as well as other trade-related disciplines such as rules of competition, protection of intellectual property, public procurement, state monopolies, state aid, and payments and transfers. Under the Agreement a Joint Committee is established which supervises the Agreement.
The Agreement consists of 40 Articles, six Annexes, five Protocols and a Record of Understanding. The Agreement covers the following main subjects:
Trade in Goods
The Agreement provides for effective market access for industrial goods in terms of tariffs and rules of origin. As from entry into force all industrial goods originating in the EFTA States or the West Bank and the Gaza Strip enjoyed duty free access (Article 4).
Fish and marine products
The Agreement covers trade in all fish and other marine products (Article 2 and Annex II). The EFTA States grant duty free access on imports of all fish products as of entry into force of the Agreement. The Palestinian Authority shall establish a duty-free import quota for certain fish products originating in the EFTA States, which shall be increased during a transition period, until it is phased out, together with the customs duties on these products, on 1 January 2004.
Trade in processed agricultural products is dealt with in a special Protocol to the Agreement (Protocol A) while trade in basic agricultural products is covered in three bilateral agricultural agreements negotiated between the respective EFTA State (Iceland, Norway and Switzerland/Liechtenstein) and the PLO for the Benefit of the Palestinian Authority. The agreements provide for substantial concessions on both sides, while taking into account the respective sensitivities. Each bilateral agreement contains specific rules of origin, generally based on the "wholly-obtained" criteria.
Rules of Origin
The rules of origin for industrial goods (Protocol B) concerning the definition of the concept of originating products and the methods for administrative co-operation, are based on the European model, maintaining the general structure and the substance of the European standard rules. The specific list rules (Annex II to Protocol B) are also based on the European model.
Sanitary and Phytosanitary Measures (SPS)
The Agreement provides for the Parties to apply their regulations in sanitary and phytosanitary matters in a non-discriminatory fashion and shall not introduce any new measures that have the effect of unduly obstructing trade.
Technical Barriers to Trade (TBT)
The Agreement provides for discussions on closer cooperation on matters related to removing technical barriers to trade within the framework of the Joint Committee.
Trade Remedies
The Agreement contains comprehensive and specific rules governing the granting of state aid by public authorities of the partner countries (Article 17). The objective of these provisions is to ensure that aid granted by the authorities to private entities do not distort, or threaten to distort, competition among undertakings in the applicable territories of the Agreement. It also includes provisions on dumping measures (Article 18) affecting the trade relations between the Parties, making a reference to Article VI of the GATT as well as on a procedure for the application of safeguard measures in Article 23.
Trade in Services
The Agreement contains a provision on a cooperative approach towards the liberalisation and mutual opening of markets by discussions in the Joint Committee with the aim of developing and deepening the relations under the Agreement (Article 25).
Investment/Establishment
The Agreement contains a provision on a cooperative approach towards further promoting investments by discussions in the Joint Committee with the aim of developing and deepening the relations under the Agreement (Article 25).
Protection of Intellectual Property (IPR)
The Parties shall grant and ensure adequate and effective protection of intellectual property rights in accordance with the highest international standards. They shall take adequate and effective measures for the enforcement of such rights against infringement thereof. Furthermore, the Parties shall co-operate in matters of intellectual property (Article 15).
Government Procurement
The provision on public procurement (Article 14) stipulates that the Parties shall co-operate within the framework of the Joint Committee in order to liberalise their respective public procurement markets.
Competition
Regarding competition (Article 16), the Agreement includes provisions on co-operation and exchange of information in Joint Committee meetings with the aim of ensuring that the benefits of the Agreement are not frustrated by private anti- competitive behaviour.
Institutional Provisions
A Joint Committee comprising the EFTA States and the PLO for the Benefit of the Palestinian Authority supervises the implementation of the Agreement (Articles 27 and 28).
Dispute Settlement
Consultations are the fundamental mechanism of dispute settlement between the FTA partners. The Agreement implies that the Parties are to endeavour to solve any differences between them on the interpretation and application of the Agreement by direct consultations, and, if need be, through consultations in the Joint Committee. For cases where the consultations do not lead to a satisfactory solution, the Parties may revert to arbitration (Article 29). Annex VI governs the constitution and functioning of the tribunal.