The Free Trade Area Agreement with Britain contains certain provisions relating to duty free licensing and rules of origin which make it necessary to amend the powers conferred by existing legislation in this matter. Certain provisions are also required in connection with the tariff concessions which are being given on goods of Northern Ireland origin. The purpose of this Bill is to provide the powers required in these respects.
The Agreement provides for the continuance at reducing rates, and for a limited period, of the 10 per cent preference given under the 1938 Agreement to British goods when licences are issued for the importation of goods at a reduced rate of duty. This was provided for in the Finance (Agreement with the United Kingdom) Act, 1938 and the relevant provision ceased to have effect on 1st July, 1966. The Bill, therefore, gives power to issue licences in which different rates of duty may be specified for goods originating in different countries.
In pursuance of the policy of closer co-operation with Northern Ireland, the Government have given tariff concessions on Northern Ireland goods with certain specified exceptions. The duty on these goods was reduced by 20 per cent on 1st July, 1966, compared with 10 per cent in the case of British goods, and will be reduced by 10 per cent annually after that— the position to be reviewed in 1971. The initial concessions are provided for in the Government order which has been made to fix the new rates of duty on British goods under the trade agreement. However, the procedure for making such orders is unduly cumbersome for the normal administration of the concessions and the provision now proposed, which will enable me to vary them with the consent of the Minister for Finance, by a more informal process will greatly facilitate the operation of the scheme.
Under present Irish rules, manufactured goods imported from Britain are regarded as being of British origin if they were manufactured there, and if a specified percentage of the cost of production was the result of work done in Britain or in Ireland. The specified percentage is 25 per cent for most goods but in some cases it is 50 per cent or 75 per cent.
As a result of discussions with Irish industry, provision was made in the Free Trade Area Agreement for certain changes in the Irish rules, in order to protect Irish industry more effectively against unfair competition from goods produced in third countries which receive insufficient processing in Britain. The changes are to raise the specified percentage from 25 per cent to 50 per cent for footwear, paint and furniture, and, for jute goods, to lay down a rule that the goods should be fully manufactured from the raw fibre either in Britain or in Ireland.
I already have power, under the Finance (Agreement with the United Kingdom) Act, 1938, to make regulations prescribing the proportion of the value of an article which must be the result of labour within a particular country, in order that the goods may be treated as manufactured in that country. That Act does not, however, empower me to prescribe rules of the type decided upon for jute goods, and it will be necessary to obtain new powers for this purpose. The Bill provides, therefore, that I shall have power to make regulations prescribing the conditions which must be satisfied in any country before goods can be regarded for Customs purposes as originating in that country. The provision in the Bill is in general terms in case it should become necessary in the future, as a result of developments in international trade, to prescribe rules of origin for goods from other countries.
I commend the Bill to the favourable consideration of the Seanad.
