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New GSP; Import Duty Free Bikes from Philippines?

Laws & Regulations

BRUSSELS, Belgium – The European Commission is to implement a new Generalised Scheme of Preferences per January 1, 2014. It offers more countries the possibility to benefit from the GSP+ duty free import status for bicycles, e-bikes and P&A. Philippines is such a country. It currently is Europe’s nr. 3 bike supplier.

New GSP; Import Duty Free Bikes from Philippines?
The Philippines, Ukraine and Pakistan become eligible for the export duty free status to the EU under the new GSP. – Photo EU

With the new Generalised Scheme of Preferences (GSP) the European Union, “Has the objective to further promote core human and labour rights, and principles of sustainable development and good governance. To achieve these aims, the EU will provide for more incentives for countries to join the GSP+ scheme, while at the same time enhancing its monitoring to ensure those rights and principles are respected.”

Highlights on new GSP

The by DG Trade published document ‘Highlights of the new Generalised Scheme of Preferences’ notes, “The new GSP provides powerful incentives to join GSP+ and to implement the 27 core conventions:

  1. There will be less competition from more advanced developing economies and sectors which lose preferences.
  2. GSP+ countries will no longer be “graduated” by sections.
  3. The so-called “vulnerability criterion” (one of the two economic conditions a country needs to fulfill in order to be eligible for GSP+) is relaxed (increased from 1% to 2% share in the overall EU GSP imports) so more countries can apply. Pakistan, the Philippines and Ukraine thus become eligible.
  4. Applications will be accepted at any time—not only every 1.5 years, as now.
  5. The number of core conventions has not been expanded, allowing countries a realistic chance to focus on the essentials.”

Reduced import duties

Currently the Philippines benefit under GSP from reduced EU import duties: 10.5% on bicycles (regular duty 14%); 2.5% on e-bikes (regular duty 6%) and 1.2% for P&A (regular duty 4.7%). Under GSP+ all bike and P&A imports into the EU will become duty free.

3rd place in Top Ten EU Bike supplying countries

It goes without saying that the GSP+ status will present a large incentive for bike exports from the Philippines to the EU. And it will undoubtedly push the country’s ranking in the table of Top Ten EU Bike supplying countries. In this table the Philippines holds a third place.

During the first half year of 2013 close to 340,000 bikes were imported from the Philippines into the European Union. This number was up 4.7% on the 2012 first half year total. The average value per imported unit in the first six months of 2013 stood at a low € 44.66, according to Eurostat data.

EU’s new Generalised Scheme of Preferences gets into force per January 1, 2014 and runs up to December 31, 2016.

For more see the complete document on this page: GSP Info Pack

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