The objectives of this Agreement are:

(a)

Promote, through the expansion of their reciprocal trade, the harmonious development of economic relations between the EFTA states and Israel;

(b)

To ensure fair competition between the EFTA states and Israel;

(c)

To contribute, through the elimination of barriers to trade, to the harmonious development and expansion of world trade;

(d)

To improve cooperation between the EFTA states and Israel.

1. The Agreement applies to:

(a)

Products under the control of chap. 25 to 97 of the Harmonized Commodity Description and Coding System, excluding the products listed in Annex 1;

(b)

The products listed in Protocol A. having regard to the special arrangements laid down in that Protocol;

(c)

Fish and other seafood products listed in Schedule II;

Originating in an EFTA or Israel State.

2. The provisions concerning trade in agricultural products which are not covered by s. 1 are found in s. 11.

3. This Agreement shall apply to trade relations between, on the one hand, each of the EFTA States and, on the other hand, Israel. It shall not apply to relations between EFTA States, unless otherwise provided for in this Agreement.

Protocol B establishes the rules of origin and methods of administrative cooperation.

2. The Parties shall adopt measures, including periodic reviews and arrangements for administrative cooperation, to ensure the effective and harmonious application of the provisions of art. 4 to 7, 12 and art. 21, taking into account the need to reduce as far as possible the formalities to which trade is subject, and to find mutually satisfactory solutions to all the difficulties raised by the application of those provisions.

3. Protocol E sets out the rules of mutual assistance in customs matters. ¹

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1. No new customs duties on deportation and tax of equivalent effect will be introduced in trade between the EFTA States and Israel.

On the entry into force of this Agreement, the EFTA States shall abolish all customs duties on imports and all taxes having equivalent effect on products originating in Israel.

On the entry into force of this Agreement, Israel shall abolish all customs duties on imports and all taxes having equivalent effect on products originating in an EFTA State.

1. The provisions of s. 1 to 3 of the art. 4 are also applicable to customs duties of a fiscal nature, subject to the provisions of Protocol C.

2. The Parties may replace a customs duty with a tax character or the tax element of a customs duty by a domestic tax.

1. No new customs duties on exports or new charges having equivalent effect will be introduced in trade between the EFTA States and Israel.

On the entry into force of this Agreement, the customs duties on exportation and the fees having equivalent effect shall be abolished, subject to the provisions of Annex III.

1. No new quantitative import or export restrictions or new measures of equivalent effect will be introduced in trade between the EFTA states and Israel.

On the entry into force of this Agreement, quantitative restrictions on imports and exports and measures having equivalent effect shall be abolished, subject to the provisions of Annex IV.

3. For the purposes of this Agreement, the term "quantitative restrictions and measures having equivalent effect" means prohibitions or limitations on imports or exports, in an EFTA State from Israel or Israel from Israel An EFTA State, in the form of quotas, import or export licences, or other measures and administrative requirements which have the effect of impeding trade.

This Agreement shall not preclude prohibitions or restrictions on the import, export or transit of goods justified on grounds of public morality, public order, public security, health protection and The life of people and animals or the preservation of plants and the environment, the protection of national treasures that have artistic, historical or archaeological value, or the protection of intellectual property. However, such prohibitions or restrictions shall not constitute a means of arbitrary discrimination or a disguised restriction on trade between the EFTA States and Israel.

The Parties shall ensure that any State monopoly of a commercial character is established in order to exclude, in the conditions of supply and marketing, any discrimination between nationals of the EFTA States and Nationals of Israel.

(2) The provisions of this Article shall apply to any body by which the competent authorities of the Parties, de jure or de facto, control, direct or influence substantially, directly or indirectly, imports or Exports between Parties. These provisions also apply to state monopolies delegated to others by the state concerned.

The Parties recognize the important role of harmonized international technical standards and regulations for the development of trade.

2. They confirm once again their accession to the GATT General Agreement on Technical Barriers to Trade ¹ And its procedures.

3. The Parties may, in the context of the Joint Committee, hold consultations where a Party considers that another Party has not fulfilled its obligations in a satisfactory manner, in particular where a Party considers that another Party has taken Measures that may create-or have created-an obstacle to trade.

4. The Parties agreed to open discussions on opportunities to cooperate more closely in the field of testing and certification with a view to further promoting trade.

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The Parties declare their readiness to promote, in accordance with their agricultural policy, the harmonious development of trade in agricultural products.

In pursuit of this objective, each of the EFTA States and Israel have entered into a bilateral arrangement providing for measures to facilitate trade in agricultural products.

3. In the veterinary, sanitary and phytosanitary matters, the Parties shall apply their rules in a non-discriminatory manner and shall refrain from introducing new measures which have the effect of unduly hindering trade.

(1) The Parties shall refrain from any measure or practice of an internal fiscal nature establishing, directly or indirectly, discrimination between the products of an EFTA State and similar products originating in Israel.

2. Goods exported to the territory of one of the Parties shall not be entitled to a domestic tax rebate that exceeds the amount of the domestic taxation of which they were directly or indirectly affected.

1. Payments relating to trade in goods between an EFTA State and Israel, as well as the transfer of such payments to the territory of the Party in which the creditor resides, shall not be subject to any restriction.

2. The Parties shall refrain from any exchange or administrative restrictions on the granting, reimbursement or acceptance of short-and medium-term credits covering commercial transactions involving a resident.

3. Israel reserves the right to apply exchange restrictions in relation to the granting or acceptance of short-or medium-term credits within the limits permitted by the IMF's recognition of Israel, provided that such restrictions Be applied in a non-discriminatory manner. They shall be applied in such a way that the operation of this Agreement is as undisturbed as possible. Israel shall promptly inform the Joint Committee of the introduction of such measures and any changes thereto.

1. The Parties shall consider the effective liberalisation of their respective public procurement markets as an integral part of the objectives of the Agreement.

On the entry into force of this Agreement, each Party shall open to enterprises of other Parties access to the procedures for participation in its public contracts, on a reciprocal basis, in accordance with the Agreement on Government Procurement of 12 April 1979 ¹ , as amended by the Protocol of Amendments of 2 February 1987, negotiated under the auspices of the General Agreement on Tariffs and Trade.

3. Taking into account the rules and disciplines agreed upon in the framework of the General Agreement on Tariffs and Trade and with third States in this field, the Parties shall extend the scope of s. 2. Above after the entry into force of this Agreement, in accordance with the following provisions:

(a)

The Parties agree to continue their efforts to ensure effective transparency, free access and non-discrimination between potential suppliers of Parties. To this end, the Parties shall progressively adapt the relevant practical conditions and procedures governing participation in invitations to tender of public authorities and undertakings, and private enterprises to which they have been granted Exclusive or special rights.

(b)

The Parties agree to defer to the Joint Committee to decide as soon as possible all practical arrangements for adaptation, including the scope, timing and rules for adaptation, taking into account the need for Maintaining a rigorous balance of rights and obligations among the Parties.

4. As soon as this is reasonably possible after the entry into force of this Agreement, the Joint Committee will open discussions with a view to reaching an agreement on the progressive extension of the list of public undertakings as well as of enterprises Of the supply covered by these provisions in respect of their purchases of goods exceeding the required thresholds.

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1. The Parties shall grant and ensure adequate, effective and non-discriminatory protection of intellectual property rights, in accordance with the definition of Art. 1 of Annex V. They shall adopt and apply adequate, effective and non-discriminatory standards in order to enforce these rights against infringement, in particular counterfeiting and piracy. Specific obligations are included in Annex V.

2. The Parties agree to abide by the substantive provisions of the multilateral conventions listed in Art. 2 of Annex V and to strive to accede to these conventions as well as to multilateral agreements aimed at fostering cooperation in the field of intellectual property protection.

3. In the field of intellectual property, the Parties shall not submit nationals of other Parties to treatment less favourable than that accorded to nationals of any other State. Any advantage or privilege, any favour or immunity arising out of:

(a)

Bilateral agreements in force for a Party at the time of entry into force of this Agreement and notified to the other Parties at the latest before the entry into force of this Agreement,

(b)

Existing and future multilateral agreements, including regional agreements on economic integration to which the Parties are not all parties,

May be exempted from this obligation, provided that this does not constitute arbitrary or unjustified discrimination against nationals of other Parties.

(4) Two or more Parties may conclude other agreements beyond this Agreement and Annex V, provided that such agreements are open to all other Parties under conditions equivalent to those of those agreements, and Parties are prepared to enter into good faith negotiations for this purpose.

5. The Parties agree to monitor mutually the application of intellectual property provisions in order to improve levels of protection and to avoid or remedy distortions of trade flows caused by levels Protection of intellectual property rights.

6. Where a Party considers that another Party has failed to fulfil its obligations under this Article and its Annex, it may take appropriate measures in accordance with the conditions and procedures laid down in Art. 23.

7. The Parties shall agree on appropriate arrangements for technical assistance and cooperation between their respective authorities. To this end, they will coordinate their efforts with the relevant international organisations.

The Parties shall take all necessary measures to achieve the objectives of the Agreement and the fulfilment of their obligations under the Agreement.

2. If an EFTA State considers that Israel, or if Israel considers that an EFTA State has failed to fulfil an obligation under the Agreement, the Party in question may take the appropriate measures under the conditions and in accordance with the procedures laid down in Art. 23.

1. Incompatible with the proper functioning of this Agreement, to the extent that they are likely to affect trade between an EFTA State and Israel:

(a)

All agreements between undertakings, any decisions by associations of undertakings and concerted practices between undertakings which have the object or effect of preventing, restricting or distorting competition;

(b)

Abuse by one or more undertakings of a dominant position on the whole or in a substantial part of the territories of the Parties.

2. These provisions shall also apply to the activities of public undertakings and undertakings to which the Parties have granted exclusive or special privileges, provided that the application of those provisions does not constitute an obstacle, de jure Or de facto, in the performance of their public duties.

3. Where a Party considers that a particular practice is incompatible with this Article, it may take appropriate measures in accordance with the conditions and procedures laid down in Art. 23.

1. The rights and obligations of the States Parties to this Agreement relating to subsidies and compensation measures shall be governed by the provisions of Art. XVI of GATT 1994 ² And the WTO Agreement on Subsidies and Countervailing Measures ³ , except provisions specific to this Article.

2. The extent of the obligations of the States Parties to this Agreement to ensure transparency in respect of subsidies shall be determined by the criteria set out in Art. XVI, para. 1 of the GATT 1994 and in Art. 25 of the WTO Agreement on Subsidies and Countervailing Measures.

3. Before an EFTA State or Israel, as the case may be, undertakes an investigation procedure in order to determine the existence, extent and effect of an alleged subsidy in Israel, or in an EFTA State, in accordance with the provisions of Art. 11 of the WTO Agreement on Subsidies and Countervailing Measures, the Party intending to initiate this investigation procedure shall notify the Party in writing of which the goods are subject to investigation and shall grant a period of 30 days to find a mutually acceptable solution. Consultations shall take place within the Joint Committee if a Party requests it within 10 days of the date of receipt of the notification.

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Where a Party finds practices of dumping in the trade relations subject to this Agreement, it may take appropriate action against such practices in accordance with s. VI of the General Agreement on Tariffs and Trade and with the rules laid down in the Agreements referring to this Article, under the conditions and in accordance with the procedures laid down in Art. 23.

Where the increase in imports of a particular good from an EFTA State occurs to a measure or under conditions that cause or are likely to cause:

(a)

Serious injury to domestic producers of like or directly competitive products in the territory of the importing Party, or

(b)

Serious disturbances in any sector of the economy or difficulties resulting in a severe deterioration in the economic situation of a region,

The Party concerned may take appropriate measures under the conditions and in accordance with the procedures laid down in Art. 23.

Where the application of the provisions of s. 6 and 7 results in:

(a)

To re-export to a third country against which the exporting Party maintains for the products in question quantitative restrictions on exports, customs duties on exports, or even measures or charges of effect Equivalent,

(b)

Or a serious shortage of a product essential to the exporting Party, or the threat of such a shortage,

And where the above situations cause or are likely to cause serious difficulties for the exporting Party, the exporting Party may take appropriate measures under the conditions and procedures laid down in Art. 23.

1.

The Parties shall endeavour to refrain from taking restrictive measures to address balance of payments difficulties.

2.

If one of the Parties meets or is likely to meet within a very short period of severe balance-of-payments difficulties, it may, in accordance with the provisions of the GATT 1994 ² And the Memorandum of Understanding on the balance of payments provisions of the GATT 1994, adopt restrictive trade measures, of limited duration, non-discriminatory and which do not go beyond what is necessary to remedy the Balance of payments problems. The relevant provisions of GATT 1994 and the Understanding on the Balance of Payments Provisions of GATT 1994 are incorporated into the Agreement.

3.

If a Party adopts a measure on the basis of this Article, it shall inform the other Parties and the Joint Committee without delay.

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1. Before commencing the procedure for the implementation of the safeguard measures set out in this Article, the Parties shall endeavour to resolve disputes between them through direct consultations and shall inform the other Parties.

2. Without prejudice to s. 6 of this Article, a Party considering the use of safeguard measures shall promptly notify its intention to the other Parties and the Joint Committee and shall provide all relevant information to them. Consultations between the Parties shall take place without delay within the Joint Committee with a view to finding a mutually acceptable solution.

3.

(a) With regard to art. 17 ¹ , the Parties shall provide the Committee with all the assistance required to examine the case in question and, where appropriate, to abolish the impugning practice. If the offending Party fails to put an end to the impugned practice within the time limit fixed by the Joint Committee, or if the Joint Committee fails to reach an agreement three months after it has been seized of the matter, the Party concerned may take the measures To overcome the difficulties resulting from the practice in question.

(b)

With regard to art. 19, 20, 21, 22 and 5A. (b) (ii) of Annex II, the Joint Committee shall examine the situation and may take any decision to put an end to the difficulties notified by the Party concerned. In the absence of such a decision within 30 days of the notification of the case to the Joint Committee, the Party concerned may take appropriate measures to remedy the situation.

(c)

With regard to art. 16, the Party concerned may take the appropriate measures after consultations within the Joint Committee have been concluded or after three months have elapsed from the date of notification.

The safeguard measures taken shall be notified immediately to the Parties and to the Joint Committee. They shall be limited, in their scope and duration, to the strict need to remedy the situation which has caused the application and shall not exceed the damage caused by the practice or difficulties in question. The measures that provide the least disruption to the operation of this Agreement shall be chosen by priority. The measures taken by Israel against an act or omission of an EFTA State may affect only the exchanges with that State.

Safeguard measures shall be the subject of periodic consultations within the Joint Committee with a view to their alleviation, replacement by others or their deletion as soon as possible.

6. Where exceptional circumstances requiring immediate intervention exclude a screening, the interested Party may, in the situations referred to in s. ... ² , 19, 20, 21 and 22, immediately apply the precautionary measures strictly necessary to remedy the situation. Such measures shall be notified without delay and consultations between the Parties shall take place within the Joint Committee as soon as possible.

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Nothing in this Agreement shall prevent a Party from taking such measures as it considers necessary:

(a)

To prevent the disclosure of information contrary to the essential interests of its security;

(b)

To protect the essential interests of its security, to fulfil international obligations or to implement national policies

(i)

Relating to the trade in arms, ammunition or war materiel, and to the trade in other goods, materials or services, such as directly or indirectly, for the supply of a military establishment,

(ii)

Relating to the non-proliferation of biological and chemical weapons, nuclear weapons or other nuclear explosive devices,

(iii)

In times of war or in the case of other serious international tension.

In the areas covered by this Agreement:

(a)

The arrangements applied by Israel vis-à-vis the EFTA States shall not give rise to any discrimination between these States, their nationals, or their companies or undertakings;

(b)

The arrangements applied by the EFTA States vis-à-vis Israel shall not give rise to any discrimination between nationals, companies or undertakings of Israel.

Disputes between States Parties to this Agreement concerning the interpretation of their rights and obligations which have not been settled by consultations or within the framework of the Joint Committee within a period of six months, may be submitted to arbitration By any State Party to the dispute, which shall send the written notification to the other State Party. A copy of this notification shall be communicated to all States Parties to this Agreement.

2. The constitution and functioning of the arbitral tribunal shall be governed by Annex VIII.

The arbitral tribunal shall settle the dispute in accordance with the provisions of this Agreement and in accordance with the rules and principles of international law in force.

4. The award of the arbitral tribunal shall be final and binding on the States parties to the dispute.

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1. A Joint Committee shall be established in which each Party shall be represented. The Joint Committee shall be responsible for the management of the Agreement and shall ensure its proper implementation.

2. For the purposes of the proper implementation of this Agreement, the Parties shall exchange information and, at the request of one of them, shall consult each other within the Joint Committee. The Council is constantly examining the possibility of continuing to remove barriers to trade between the EFTA states and Israel.

3. The Joint Committee may, under the conditions set out in par. 3 of Art. 27, make decisions in the cases provided for in this Agreement. On other matters, the Joint Committee may make recommendations.

For the purposes of the proper implementation of this Agreement, the Joint Committee shall meet at the appropriate level whenever necessary, but at least once a year. Each Party may request its convocation.

2. The Joint Committee shall decide by mutual agreement.

3. Where a representative on the Joint Committee of one of the Parties has accepted a decision subject to the completion of the constitutional formalities, the decision shall enter into force, if it does not mention a later date, The day on which the withdrawal of the reservation is notified.

4. For the purposes of this Agreement, the Joint Committee shall establish its rules of procedure, which shall include, inter alia, provisions relating to the convening of its meetings, the appointment of its President and the terms of reference thereof.

The Joint Committee may decide to set up any sub-committee or working group to assist it in the performance of its tasks.

Where a Party considers that it would be in the interest of the economies of the Parties to develop the relationship established by the Agreement by extending them to areas not covered by the Agreement, the Party shall submit a reasoned request to them.

The Parties may entrust the Joint Committee with the consideration of this request and shall, where appropriate, make recommendations to them.

(2) Agreements resulting from the procedure laid down in paragraph 1 shall be subject to ratification or approval by the Parties in accordance with their own procedures.

The Parties recognize the growing importance of certain areas such as services and investments. In their efforts to deepen and progressively broaden their cooperation, they will act in common with a view to achieving gradual liberalisation and mutual opening up of their investment markets and trade in services, Taking into account relevant GATT work. They shall endeavour to grant treatment no less favourable than that reserved for domestic and foreign operators in the territory, provided that a balance of rights and obligations between the Parties is established.

2. The terms of this cooperation will be negotiated within the Joint Committee. The arrangements resulting from such negotiations shall be subject to ratification or approval by the Parties in accordance with their own procedures. They shall be applied in the context of this Agreement.

The Protocols and Annexes to this Agreement are integral parts of this Agreement. The Joint Committee may decide to amend them.

This Agreement shall not preclude the maintenance or establishment of customs unions, free trade zones or arrangements relating to border trade, provided that they have no adverse effect on the trade regime and Specific provisions concerning the rules of origin contained in this Agreement.

This Agreement shall apply in the territory of the Parties.

1. This Agreement shall enter into force on 1 ^Er January 1993 in respect of Signatories States which have then submitted to the Depositary their instrument of ratification or acceptance, provided that Israel is among the States that have deposited their instruments of ratification or acceptance.

2. For a State Signatory which deposits its instrument of ratification or acceptance after 1 ^Er In January 1993, this Agreement shall enter into force on the first day of the second month following the deposit of its instrument, provided that Israel is among the States that have deposited their instruments of ratification or acceptance.

Any Signatory State may, already at the time of signature of the Agreement, declare that, during an initial phase, it will apply the Agreement provisionally if it cannot enter into force on 1 ^Er January 1993 as far as that State is concerned, provided that it has entered into force with regard to Israel.

Amendments to this Agreement-other than those referred to in s. 30-which are approved by the Joint Committee shall be submitted to the Parties for ratification or acceptance and shall enter into force upon ratification or acceptance by all Parties. Instruments of ratification or acceptance shall be provided to the depositary Government.

1. Any Member State of the European Free Trade Association may accede to this Agreement, provided that the Joint Committee decides to approve its accession in the terms and conditions set out in the decision. The instrument of accession shall be given to the depositary government.

(2) In respect of the State which decides to accede to it, the Agreement shall enter into force on the first day of the third month following the deposit of its instrument of accession.

1. Each Party may withdraw from this Agreement by written notification addressed to the Depositary. The withdrawal shall take effect six months after the date of receipt of the notification by the depositary government.

2. If Israel withdraws, the Agreement expires at the end of the notice period and, if all the EFTA States withdraw, it expires at the end of the period of the last notice received.

3. Any EFTA Member State which withdraws from the Convention establishing the European Free Trade Association ceases Ipso facto To be a party to this Agreement on the same day that the withdrawal takes effect.

The Government of Norway ¹ , acting as depositary government, shall notify all States which have signed or acceded to this Agreement of the deposit of any instrument of ratification, acceptance or accession, the entry into force of this Agreement, its expiry Or its denunciation by either Party.

In witness whereof, The undersigned plenipotentiaries, duly authorized to that effect, have signed this Agreement.

Done at Geneva, on 17 September 1992, the English text being authentic, in a single copy which shall be deposited with the Government of Sweden. The depositary government shall transmit certified copies to all signatory and acceding States.

Memorandum of Understanding

Import levy

1. Israel renews its commitment, transmitted to the GATT Contracting Parties, to reduce the import levy from 2 to 1 % by 31 December 1994 at the latest.

2. The EFTA States and Israel have agreed that the application of this levy is subject to the provisions of Art. 22, from the entry into force of the Agreement.

Port taxes

3. Their views on the compatibility of the current structure of port charges levied in Israel with the requirements of the Agreement being divergent, the Parties agreed that immediately after the entry into force of the Agreement, the question Be raised in the Joint Committee with a view to finding a mutually acceptable solution to this problem.

Application of the TAMA markup to goods imported into Israel

4. Israel will ensure that the tax on the purchase of imported goods is calculated on the basis either (a) of the stated wholesale price, or (b) the value of the said value plus a TAMA increase. Licensed importers will be allowed to choose between one and the other. Unapproved importers will continue to pay the tax on the purchase on the basis of the TAMA markup.

5. The sole criterion for obtaining a certified importer status will be as follows:

(a)

The importer imported into Israel, during the calendar year preceding that for which the importer wishes to obtain the status of an approved importer, goods of any origin whose total value exceeds their threshold value of the year For which it is requesting the status. The threshold value for each year is as follows:

1992	=	$300,000
1993	=	$200,000
1994	=	$100,000
1995 and subsequent years	=	$50,000

(b)

During the preceding five years, the importer did not commit a tax offence punishable by imprisonment and a fine which exposes it, if it is a repeat offence, to the prohibition on the sale of the goods of the species About which the offence was committed.

6. An importer who has obtained in the past the status of an approved importer may not be deprived of the status of:

(a)

If he has been satisfied with a tax offence within the meaning of s. 5 (b); or

(b)

If during the preceding calendar year and for at least one other year in the preceding five years, it has failed to import goods for a total value greater than the threshold value applicable to the current year.

7. The application forms will be simple and clear, and contain a provision indicating the choice of the applicant either on the actual value at the wholesale price or on the basis of the TAMA gross-up, for the assessment of the tax at Purchase. Once arrested, this election will determine the importer's tax treatment for the next twelve months and may subsequently be amended at any time, at the request of the importer only. From l ^Er January 1995, Israel will implement a mandatory wholesale price reporting system for all registered importers.

8. Each importer may apply to the District Manager for a certified importer status. The decision will be communicated to him within twenty-one days. If the importer is positive, the importer will be given the status of a certified importer. If negative, the District Manager will set out in writing the reasons for the rejection of the application in accordance with the terms and conditions set out in subs. 5.

9. The registered importer who chooses to pay the tax on the purchase calculated on the basis of the actual wholesale price will be required to file a wholesale price return (for goods subject to the tax on purchase) at the same time as the importer's return Of import. The declaration must comply with the requirements of the art. 1 and 17 of the Tax on Purchase Act. The obligation to keep records, the obligation to submit periodic reports, and the account verification and appeal procedures applicable to importers will be the same as required of local producers.

10. Israel will take steps to ensure that the TAMA coefficient applicable to each product does not exceed a level that reflects the actual practice followed by the wholesalers who sell the product. The TAMA mark-up rates will be calculated on the basis of the actual increase in the bulk of a random sample taken from registered and unapproved importers.

11. On the request of the EFTA States, Israel will provide a list of applicable TAMA coefficients and, if requested by the EFTA States for specific products, an explanation of the methodology applied to the calculation of the TAMA markup rates For these products. Similarly, if requested, Israel will notify the EFTA States of any changes that could affect the TAMA increase coefficients.

Import and Export Permits

12. If automatic licenses are used, they should be administered in such a way that they do not result in trade restrictions. In any case, these licences should be issued within 14 days. At the entry into force of the Agreement, the Parties further agreed to provide each other with a list of items subject to automatic import permits.

Rules of origin

13. With regard to Explanatory Note 7 to Annex I to Protocol B, it is agreed that until Israel becomes a Party to the Agreement on Implementation of Article VII of the GATT ² , this country will define the "value for duty" in accordance with the Convention on the value for duty of goods.

14. Israel intends to accede to the Agreement on the Implementation of Art. VII of the GATT no later than five years after the entry into force of this Agreement.

Limit Values

15. The EFTA States and Israel have agreed that no later than 1 ^Er January 1997, the limit values shown in s. 1 and 2 of Art. 8 of Protocol B relating to the declaration of the exporter, will be-for small packages and personal luggage of travellers-at the same level as the limit values applied on that date in accordance with the free trade agreements between The EFTA States and third countries.

State Monopolies

Article 9 of the Agreement will apply to Liechtenstein and Switzerland in the case of state monopolies on salt and ammunition powder, and to Iceland's monopoly on fertilisers, to the extent that these states will have to fulfil obligations Agreement between the EFTA States and the European Communities and their Member States on a European Economic Area.

17. Art. 9 shall be applicable at the latest from 1 ^Er January 1995, in the case of the Austrian salt monopoly.

Restrictions on exchanges for religious or ceremonial purposes

18. The Parties have agreed that prohibitions or restrictions on the import, export or transit of goods, justified on religious or ritual grounds, are compatible with the Agreement, provided that they are applied In accordance with the principle of national treatment, in accordance with the procedure laid down in Art. 8 of the Agreement and in compliance with its provisions.

Intellectual Property Rights

19. Pursuant to s. 15 of the Agreement, the Parties undertake to ensure:

(a)

To ratification, at 1 ^Er January 1995, of the International Convention of 26 October 1961 for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (the Rome Convention), its accession and its respect thus To enact any legislation necessary to give effect to the said act;

(b)

That, within five years of the entry into force of the Agreement, licences issued on grounds of non-application shall be used to the extent necessary to provide a predominant supply of the internal market under conditions Reasonable commercial.

State aid

20. The rules applicable to state aid and their implementation will be reviewed before the end of 1995, in particular with a view to adapting them to such or such a change which may have arisen in the relations between the Parties and the European Communities As regards public aid.

Arbitration procedures

The EFTA States and Israel consider that an arbitration procedure could be envisaged for disputes which cannot be resolved through consultations between the Parties in question or within the Joint Committee. The Joint Committee will continue its consideration of this procedure.

Cooperation

The Joint Committee may discuss the possibilities of promoting trade relations, through trade cooperation, and the modalities of such promotion.

Joint conclusions on exports from the Territories

An arrangement has been reached which will allow the export of industrial and agricultural products from the territories, by Israel, to the EFTA states. Under this arrangement, Israel will take practical steps to ensure that such exports can take place without encountering administrative obstacles. For exports to EFTA States from Arab producers and exporters in the Territories, procedures similar to those applicable to their exports to the European Community shall apply.

Arab producers and exporters in the Territories will be free to establish relations and negotiate with buyers from the EFTA states to promote their commercial interests.

In the Territories, the local Arab Chambers of Commerce will be empowered to issue certificates of origin.

Table of Contents

Objectives Art. 1

Scope Art. 2

Rules of Origin Art. 3

Customs import duties and fees of equivalent effect Art. 4

Customs duties with a tax character Art. 5

Customs duties on exportation and taxes having equivalent effect Art. 6

Quantitative restrictions and measures of equivalent effect Art. 7

Non-economic reasons justifying restrictions Art. 8

State monopolies Art. 9

Technical Regulations Art. 10

Trade in agricultural products Art. 11

Domestic taxation Art. 12

Payments S. 13

Government Procurement Art. 14

Intellectual Property Protection Art. 15

Enforcement of obligations Art. 16

Competition rules applicable to undertakings Art. 17

Grants Art. 18

Anti-dumping Art. 19

Emergency measures applicable to the importation of certain products Art. 20

Reexport and Severe Shortage Art. 21

Balance of payments difficulties Art. 22

Procedures for the Application of Safeguards Art. 23

Exceptions to security Art. 24

Non-discrimination Article 25

Arbitration Procedure Art. 25 ^Bis

Institution of the Joint Committee Art. 26

Procedures of the Joint Committee Art. 27

Evolutionary clause S. 28

Services and Investments Art. 29

Protocols and Annexes Art. 30

Customs unions, free trade zones and border trade Art. 31

Territorial application Art. 32

Entry into force Art. 33

Amendments Art. 34

Accession Art. 35

Withdrawal and expiration Art. 36

The Depositary Art.

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