Date: 2023-12-28Category: Not ApplicableState: Union GovernmentCountry: Europe
Decision No 1/2023 of the Partnership Council established by the Trade and Cooperation Agreement between the European Union and the European Atomic Energy Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part of 21 December 2023 as regards the transitional product-specific rules of origin for electric accumulators and electrified vehicles [2023/2891]
Executive Summary:
Decision No 1/2023 of the Partnership Council extends transitional product-specific rules of origin for electric accumulators and electrified vehicles until December 31, 2026. After this date, the rules set out in Annex 3 of the Trade and Cooperation Agreement will apply. The decision also removes the possibility of further changes to these rules until January 1, 2032, to encourage investment in manufacturing capacity within the EU and the UK.
Key Points / Main Content:
* **Extension of Transitional Rules:**
* Product-specific rules of origin for electric accumulators and electrified vehicles applicable until December 31, 2023, are extended to December 31, 2026.
* **Future Rule Application:**
* From January 1, 2027, the product-specific rules of origin in Annex 3 of the Trade and Cooperation Agreement will apply to electric accumulators and electrified vehicles.
* **Restriction on Amendments:**
* No further changes to the product-specific rules of origin for electric accumulators and electrified vehicles will be considered until January 1, 2032.
* **Amendment to Article 68:**
* Article 68 of the Trade and Cooperation Agreement is amended, restricting the Partnership Council's ability to modify Annex 5 and the product-specific rules in Annex 3 (for products in Annex 5) until January 1, 2032, except for updates to the Harmonised System.
* **Replacement of Annex 5:**
* Annex 5 of the Trade and Cooperation Agreement is replaced with the text provided in the Annex to this Decision, detailing transitional product-specific rules.
* **Specific Product Rules (Until December 31, 2026):**
* For accumulators (HS code 85.07), assembly of battery packs from non-originating battery cells/modules is allowed up to MaxNOM 70 EXW.
* For battery cells/modules intended for electric accumulators, CTH or MaxNOM 70 EXW applies.
* For hybrid and electric vehicles (HS codes 87.02-87.04), MaxNOM 60 EXW applies.
Impact Analysis:
* **Electric Vehicle and Accumulator Manufacturers in the EU and UK:**
* Impact: Benefit from the extended transitional rules of origin, providing continued flexibility in sourcing components until the end of 2026. After 2026, they must comply with Annex 3 rules. The long-term restriction on amendments provides investment certainty.
* Action Required: Understand and prepare for the transition to Annex 3 rules by January 1, 2027. Monitor any updates to the Harmonised System that may affect product-specific rules.
* **EU-UK Partnership Council:**
* Impact: Limited ability to amend Annex 5 and related product-specific rules in Annex 3 until January 1, 2032, except for updates to the Harmonised System.
* Action Required: Implement the decision and monitor its impact on trade and investment in the electric vehicle and accumulator sectors.
Key Entities Referenced
European Union: One of the parties to the Trade and Cooperation Agreement.
European Atomic Energy Community: One of the parties to the Trade and Cooperation Agreement.
United Kingdom of Great Britain and Northern Ireland: One of the parties to the Trade and Cooperation Agreement.
Trade and Cooperation Agreement: The agreement between the European Union, the European Atomic Energy Community, and the United Kingdom of Great Britain and Northern Ireland, which is the subject of this decision.
Partnership Council: The council established by the Trade and Cooperation Agreement responsible for amending the agreement.
Annex 5: Annex to the Trade and Cooperation Agreement, pertaining to transitional product-specific rules for electric accumulators and electrified vehicles, which is being amended.
Annex 3: Annex to the Trade and Cooperation Agreement which contains product-specific rules of origin.
Brussels: One of the locations where the decision was adopted.
Official Journal EN
of the European Union L series
2023/2891 28.12.2023
DECISION No 1/2023 OF THE PARTNERSHIP COUNCIL ESTABLISHED BY THE TRADE AND
COOPERATION AGREEMENT BETWEEN THE EUROPEAN UNION AND THE EUROPEAN
ATOMIC ENERGY COMMUNITY, OF THE ONE PART, AND THE UNITED KINGDOM OF GREAT
BRITAIN AND NORTHERN IRELAND, OF THE OTHER PART
of 21 December 2023
as regards the transitional product-specific rules of origin for electric accumulators and electrified
vehicles [2023/2891]
THE PARTNERSHIP COUNCIL,
Having regard to the Trade and Cooperation Agreement between the European Union and the European Atomic Energy
Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part, and in
particular its Article 68 and its Annex 5,
Whereas:
(1) The Trade and Cooperation Agreement, in its Annex 5, provides for a phased-in entry into force of product-specific
rules of origin for electric accumulators and electrified vehicles.
(2) Concerns were raised about challenges posed by the application of these rules to the assembly of electric vehicles in
the European Union and in the United Kingdom.
(3) It is therefore appropriate to extend the application of the product-specific rules of origin for electric accumulators
and electrified vehicles applicable until 31 December 2023 up to 31 December 2026. From 1 January 2027, the
product-specific rules of origin for electric accumulators and electrified vehicles as set out in Annex 3 of the Trade
and Cooperation Agreement will apply.
(4) The aim of the product-specific rules for electric accumulators and electrified vehicles set out in the Trade and
Cooperation Agreement is to incentivise the investment in a manufacturing capacity in the European Union and in
the United Kingdom. No further postponement of the incoming rules should be considered. Therefore, the
envisaged amendment should furthermore remove the possibility for further changes to the product-specific rules
of origin for electric accumulators and electrified vehicles until 1 January 2032.
HAS ADOPTED THIS DECISION:
Article 1
Article 68 of the Trade and Cooperation Agreement is replaced by the following:
‘Article 68
Amendment to this Chapter and its Annexes
1. The Partnership Council may amend this Chapter and its Annexes, subject to paragraph 2.
2. Paragraph 1 shall not apply to:
(a) Annex 5 to this Agreement;
(b) the product-specific rules of origin set out in Annex 3 for products listed in Annex 5, until 1 January 2032; and
(c) this Article, insofar as it relates to Annex 3 for products listed in Annex 5, and Annex 5, until 1 January 2032;
However, paragraph 1 shall apply where the product-specific rules of origin set out in Annex 3 for products listed in Annex
5, or in Annex 5 are amended due to updates of the Harmonised System.’
ELI: http://data.europa.eu/eli/dec/2023/2891/oj 1/3EN
OJ L, 28.12.2023
Article 2
Annex 5 to the Trade and Cooperation Agreement is replaced by the text in Annex to this Decision.
Article 3
This Decision shall enter into force on the date of its adoption.
Done at Brussels and London, 21 December 2023.
For the Partnership Council
The Co-chairs
Maroš ŠEFČOVIČ
David CAMERON
2/3 ELI: http://data.europa.eu/eli/dec/2023/2891/ojEN
OJ L, 28.12.2023
ANNEX
‘ANNEX 5
TRANSITIONAL PRODUCT-SPECIFIC RULES FOR ELECTRIC ACCUMULATORS AND
ELECTRIFIED VEHICLES
Interim product-specific rules applicable from the entry into force of this Agreement until
31 December 2026
For the products listed in column 1 below, the product-specific rule listed in column 2 shall apply for the period from the
entry into force of this Agreement until 31 December 2026.
Column 1 Column 2
Harmonised System classification (2017) including specific Product-specific rule of origin applicable from the entry into force
description of this Agreement until 31 December 2026
85.07
— Accumulators containing one or more battery cells or CTSH;
battery modules and the circuitry to interconnect them Assembly of battery packs from non-originating battery cells
amongst themselves, often referred to as “battery packs”, or battery modules;
of a kind used as the primary source of electrical power or
for propulsion of vehicles of headings 87.02, 87.03 MaxNOM 70 % (EXW)
and 87.04
— Battery cells, battery modules, and parts thereof, intended CTH;
to be incorporated into an electric accumulator of a kind or
used as the primary source of electrical power for propul MaxNOM 70 % (EXW)
sion of vehicles of headings 87.02, 87.03 and 87.04
87.02-87.04
— vehicles with both internal combustion engine and elec MaxNOM 60 % (EXW)’
tric motor as motors for propulsion other than those
capable of being charged by plugging to external source
of electric power (“hybrid”);
— vehicles with both internal combustion piston engine
and electric motor as motors for propulsion capable of
being charged by plugging to external source of electric
power (“plug-in hybrid”);
— vehicles with only electric motor for propulsion
ELI: http://data.europa.eu/eli/dec/2023/2891/oj 3/3