THE TRADE LIBERALISATION SCHEME OF WEST AFRICA FREE TARDE AREA


 

The ECOWAS Trade Liberalisation Scheme (ETLS) is the main ECOWAS operational tool for promoting the West Africa region as a Free Trade Area. This lies in tandem with the one of the objectives of the community which is the establishment of a common market through : the liberalisation of trade by the abolition, among Member States, of customs duties levied on imports and exports, and the abolition among Member States, of non-tariff barriers…

 

The rules of origin which guide this concept are defined in the ECOWAS protocol A/P1/1/03 of 31st January 2003. It defines out originating products as follows:

  • Wholly produced goods; goods whose raw materials completely originate from the region.
  • Goods which are not wholly produced but their production requires the exclusive use of materials which are to be classified under a different tariff sub-heading from that of the product.
  • Goods which are not wholly produced but their production requires the use of materials which have received a value added of at least 30% of the ex-factory price of the finished goods.

It must be noted that goods manufactured in free zones or special economic schemes involving suspension or partial or total exemption of entrance fees do not qualify for originating products status.

CALCULATIONS FOR ETLS CRITERIA FOR APPROVAL

  • Calculation of the proportion of 60% local content of products (b) to (i) cited in article 3, paragraph j of the ECOWAS Treaty:{∑ QLocal ⁄ ∑Q (Local + Foreign)} × 100 ≥ 60%
  • The criteria for change of tariff headings, which must be reflected in the first 4 digits of the HS code
  • The calculation of value-added which must be at least 30% of the ex-factory price minus taxes of the products (article 4, paragraph 2 of the mentioned protocol):
    VA⁄Ex-factory Price × 100 ≥ 30%
  • Valued Added (VA) is the total ex-factory price minus CIF Value (or taxes) of raw materials and consumables. Components determining ex-factory cost price include: Raw materials, consumables, packaging and other expenditure borne by the company. Please note: Salaries and wages must not be more than 20% of the ex-factory cost price. Works, supplies, and external services must not be more than 10% of the ex factory cost price and must be directly tied to production. Financial charges must not be more than 30% of the ex factory cost price.”

 

The procedures for approval consist of two processes: the Enterprise procedures and the National Approvals Committee procedures.

Enterprise Procedure: The enterprise sends its completed application form and all supporting documents to the ministry responsible for ETLS matters in the country concerned.

National Approvals Committee Procedure: The Ministry sends completed application forms to members of the National Approvals Committee (specially set up to scrutinize ETLS applications). The Committee holds a series of meetings and discussions to examine all ETLS applications brought before it at the time. Approvals or disapprovals are then recommended.

The report of the Committee recommending approvals and disapprovals is submitted to the responsible Ministry which sends the report and dossiers on the recommended approvals to the ECOWAS Commission.

The ECOWAS Commission reassesses the applications and if satisfied with the NACs approvals, sends out notification letters to all Member States informing them of the newly approved enterprises and products.

It is after the notification letters are sent out, that approved enterprises obtain the Certificates of Origin for their approved products from their responsible Ministries.

MEMBER COUNTRIES OF ECOWAS :

 

  1. BENIN 2.BURKINA FASO 3.CABO VERDE4.COTE D’IVOIRE5.THE GAMBIA 6.GHANA 7.GUINEA 8.GUINEA-BISSAU9.LIBERIA10.MALI 11.NIGER 12.NIGERIA 13.SENEGAL 14.SIERRA LEONE 15.TOGO

neeraj001@gmail.com ; +91- 9810936720

 

 

 

 

 

 

 

 

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