New Preferential Arrangements for Developing Countries: The EU GSP in 2006

On 7 July 2004, the European Commission issued a Communication setting out its plans to overhaul its Generalised System of Preferences (GSP), the basis upon which the EU extends tariff preferences to developing countries. The Communication, which sets out the main objectives for the 10-year period 2006–2015, will be followed by a formal proposal in autumn 2004. The new system, which will enter into force on 1 January 2006, will be implemented through Council Regulations, the first of which will be in effect for 3 years. This issue of Trade Hot Topics explains the origins of the GSP and examines what the new GSP purports to do.