European Commission Directorate-General for Trade

Everything But Arms

The origins

Over the last 40 years, trade has proved to be one of the most effective tools to foster development. Increased trade with developing countries enhances their export earnings, promote their industrialisation and encourage the diversification of their economies. The classical instruments for achieving these objectives are tariff preferences, which provide an incentive to traders to import products from developing countries and thus help them to compete on international markets.

In 1968, the first United Nations Conference on Trade and Development (UNCTAD) recommended the creation of a "Generalised System Tariff of Preferences" under which industrialised countries would grant autonomous trade preferences to all developing countries. A waiver was granted in 1971 from Article 1 of the GATT, which prohibits discrimination, to authorise developed countries to establish individual "Generalised Schemes of Tariff Preferences". (The acronym "GSP" sometimes refers to the system as a whole, sometimes to one of the individual schemes). The European Community was the first to implement a GSP scheme in 1971. Other countries have subsequently established their own GSP schemes that differ both in their product coverage and rules of origin. In order to update its scheme on a regular basis and to adjust it to the changing environment of the multilateral trading system, the EU's GSP is implemented following a cycle of ten years. The present cycle which lasts from 2006 to 2015 was adopted in 2004.

Traditionally, it has been admitted that the group of least developed countries (LDCs) should receive more favourable treatment than other developing countries. Gradually, market access for products from these countries has been fully liberalised. In February 2001, the Council adopted Regulation (EC) 416/2001, the so-called "EBA Regulation" ("Everything But Arms"), granting duty-free access to imports of all products from LDCs, except arms and ammunitions, without any quantitative restrictions (with the exception of bananas, sugar and rice for a limited period).

EBA was later incorporated into the GSP Council Regulation (EC) No 2501/2001, The Regulation foresees that the special arrangements for LDCs should be maintained for an unlimited period of time and not be subject to the periodic renewal of the Community's scheme of generalised preferences.

EBA: Special arrangements for least developed countries

Beneficiaries of the special arrangements for least developed countries require formal recognition by the United Nations. At present, 49 developing countries belong to the category of LDCs:

EBA provides the most favourable regime available. The EBA gives the 49 LDCs duty free access to the EU for all products, except arms and ammunition.

For the period from 1 October 2009 to 30 September 2012 the importer of sugar shall undertake to purchase such products at a minimum price not lower than 90 % of the reference price.

When a country is excluded by the UN from the list of the least-developed countries, it shall be withdrawn from the list of the beneficiaries of this arrangement. The removal of a country from the arrangement and the establishment of a transitional period of at least three years shall be decided by the Commission, in accordance with the procedure referred in the GSP Regulation.

1. Myanmar was withdrawn from the list of GSP countries in 1997 (Council Regulation 552/97) based on article 9 of Regulation (EC) No 3218/94 and article 9 of Regulation (EC) No 1256/96 which provided that preferences could be withdrawn in circumstances including the practice of any form of forced labour, as defined by ILO Conventions No. 29 and 105. ¶
2. Relates to the following document: ¶
   1. COMMISSION REGULATION (EC) No 1547/2007 of 20 December 2007 establishing a transitional period for withdrawing the Republic of Cape Verde from the list of beneficiary countries of the special arrangement for least developed countries, as set out in Council Regulation (EC) No 980/2005 applying a scheme of generalised tariff preferences
      • 21 December 2007
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