EU Adopts New Agreement On Pharmaceutical Customs Duties

by Ulrika Lomas, for LawAndTax-News.com, Brussels

15 February 2007

The European Commission on Monday welcomed the adoption by EU Member States of an international agreement which will make it easier to trade in pharmaceuticals.

The third revision of the Pharma-GATT Agreement will eliminate customs duties among the main pharmaceutical trading nations and territories, and aims to improve the competitiveness of EU pharmaceutical companies.

EU Trade Commissioner Peter Mandelson announced that:

"This agreement puts free trade at the service of European businesses and consumers. It is a show of confidence in the global competitiveness of the EU pharmaceutical industry, and a signal of our commitment to ensuring that the modern trading environment is in step with innovation."

In a statement, the EC confirmed that:

"Thanks to the good cooperation between the pharmaceutical industry and the EU Customs experts, the third revision of the Pharma-GATT Agreement will eliminate customs duties applied on new pharmaceuticals (as well as on chemical intermediates used in the production of those pharmaceuticals) among the main pharmaceutical trading nations and territories. The European Union, the United States and Switzerland are part of the Agreement as from 1 January 2007. Japan is expected to apply this revision later this year. The Agreement is also open to additional Members."

"In the review, 1,290 new pharmaceuticals and chemical products have been added to the existing list of 7,329 products benefiting from bound duty-free treatment upon importation into the EU."

It concluded by revealing that:

"The European Chemical Industry Council – CEFIC – has estimated the savings generated by the Agreement for EU pharmaceutical companies at around EUR230 million for the year 2007."

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