Taxation and Customs Union

Andorra : Customs Unions and preferential arrangements

a) General introduction

  • The Customs Union established in 1990 between The European Community and the Principality of Andorra covers products covered by Chapters 25 to 97 of the Harmonized System (HS)
  • Products covered by Chapters 1 to 24 of the Harmonized System which originate in the Principality of Andorra are exempt from import duties when imported into the Community
  • Most Favored Nation treatment (MFN) : the arrangements applied to goods from third countries imported into the Principality of Andorra shall not be more favorable than those applied to imports of Community goods
  • Application of a preferential arrangement for some tobaccos manufactured in the EC, imported into Andorra.

b) Legal framework

c) Specific provisions

  • Scope of the Customs Union: Chapters 25 to 97 HS
  • Customs Union's internal aspects: free movement of goods (Article 6)
    • Elimination of tariff and non tariff measures
    • For processed agricultural products, the abolishment of customs duties on imports and charges having equivalent effect applies to customs duties constituting the fixed component of the charge on imports of those products into the Community from the Principality of Andorra, while the variable component shall continue to apply
  • Customs Union's external aspects: customs tariff and commercial policy; Joint Declaration in EC preferential agreements
  • Adoption by Andorra of the provisions on import formalities applied by the Community to third countries and the laws, regulations and administrative provisions applicable to customs matters in the Community and necessary for the proper functioning of the customs union (Aricle 7)
  • Special duty/tax relief for travelers (Article 13)
  • Empowerment of the Joint Committee for implementation (Article 17)

d) Customs Cooperation Committee Decision 1/2003 'Bridging Legislation'

  • The Principality of Andorra adopt customs provisions necessary for the proper functioning of the Customs Union based on the Community Customs Code and its implementing provisions..
  • The Decision contains provisions on mutual assistance in the field of recovery of claims (Articles 4 to 24)
  • Provisions concerning transit between the two parts of the Customs Union (Articles 27 to 31)
  • Provisions applicable to trade in goods with third countries:
    • customs value, inward processing, outward processing, returned goods
    • the Principality of Andorra applies, in the same manner as the Community, the Community provisions on the rules of origin in trade with countries enjoying tariff preferences
  • Rules of Origin
    • Art. 62: where the Principality of Andorra grants autonomously the tariff preferences, and its authorities wish to carry out a post-clearance control of a certificate of origin (EUR.1 or form A) or an invoice declaration, such controls shall be made by one of the designated Community customs offices (Perpignan and La Farga de Moles).  
    • Art. 63 : the replacement certificates issued by the Community customs offices or customs offices of the Principality of Andorra under whose control the products have been placed shall be accepted in the other part of the Customs Union under the conditions laid down in each of those procedures.
    • Art. 64 : Andorra shall apply mutatis mutandis Regulation No 1207/2001 (supplier's declaration)

e) Preferential regime for agricultural products : Appendix concerning the definition of the concept of "originating products" and methods of administrative cooperation

  • Article 3 of this Appendix provides for bilateral cumulation for materials originating in the European Community or Andorra when they are incorporated in a product obtained in the Community or in Andorra.
  • The list of insufficient working or processing operations (Article 6 of the Appendix) is not in line with the current pan-Euro-Mediterranean protocols on rules of origin
  • The principle of territoriality (Article 10 of the Appendix) has no derogation, as it is the case in the pan-Euro-Mediterranean protocols on rules of origin

The provisions related to accounting segregation do not apply to the Appendix on rules of origin, contrarily to the pan-Euro-Mediterranean protocols on rules of origin.