Correction on New GSP Tariffs

The news on new GSP Tariffs published on our website last week was not completely correct. In the article, it was stated that, as from January 1, 2002, GSP-duties will be 3.5% lower than today. In fact the reduction of 3.5% will not apply to current GSP-duties but to the current Common Customs Tariff Duties. However, in some cases, bicycles for instance, this would result in tariff increases. Today, the Common Customs Tariff Duty for bicycles is 15%. Bicycles are classified as sensitive products, thus under GSP only 70% of the normal import duty applies, i.e. 10.5%. In the new regime, the normal duty will be reduced by 3.5% which, for bicycles, would result in a preferential rate of 11.5%, i.e. 1% more than the current tariff. Therefore, the Commission has now added a clause to the draft Regulation stipulating that the most favourable regime stands. As a result, instead of applying a 3.5% reduction to bicycles the current preferential rate of 10.5% will be maintained. For all other two-wheeler products the 3.5% reduction is the most favourable solution. Consequently, motorcycle parts and accessories will be completely exempted. The draft also stipulates that if, as a result of the 3.5% reduction, preferential duties turn out to be less than 1% or 2 Euro, the import is completely exempted. Bicycle parts and accessories end up just over 1% but if this results in a nominal duty less than 2 Euro it does not need to be paid after all. We apologize for the error. A complete listing of all the new GSP Tariffs will be published in Bike Europe's December edition. (AR)