4.3.97 Official Journal of the European Communities No L 62/43 COMMISSION DECISION of 18 February 1997 on the initiation of international consultation and dispute settlement procedures concerning changes to United States rules of origin for textile products resulting in the non-conferral of Community origin on certain products processed in the European Community (97/162/EC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EC) No 3286/94 of 22 December 1994 laying down Community procedures in the field of the common commercial policy in order to ensure the exercise of the Community’s rights under international trade rules, in particular those established under the auspices of the World Trade Organization (WTO) (), as amended by Regulation (EC) No 356/95 (3, and in particular Articles 13 and 14 thereof, After consulting the Advisory Committee, Whereas: A. PROCEDURE (1) On 11 October 1996 a compliant was submitted to the Commission about an obstacle to trade result- ing from changes to United States legislation on rules of origin for textile products. The complain- ant alleged that the new rules refuse Community originating status to products which have been dyed, printed and finished in the Community on loom-state fabrics produced in non-member coun- tries. Under previous US legislation, that is prior to July 1995, these products had Community origin. According to the complainant, this change threat- ens Community exports of textile products. (20 The complaint was lodged by the association Federtessile, Italy, on behalf of the association representing the Italian silk industry and the asso- ciation representing the Italian luxury finishing textile industry. The complaint contained sufficient () OJ No L 349, 31. 12. 1994, p. 71. () OJ No L 41, 23. 2. 1995, p. 3. evidence to justify the initiation of a procedure under Regulation (EC) No 3286/94. (3)  An examination procedure was initiated on 22 November 1996 (*). Federtessile’s allegations were included in the notice of initiation. B. ALLEGATIONS OF OBSTACLES TO TRADE (40 The complainant alleged that the changes made by the US to their rules of origin legislation for textile products, following the entry into force of the WTO Agreements, constituted an obstacle to trade within the meaning of Article 2 (1) of Regulation (EC) No 3286/94. More specifically, the complain- ant referred to two Agreements annexed to the WTO Agreement: Article 4 (2) of the Agreement on Textiles and Clothing and Article 2 (b) and (c) of the Agreement on Rules of Origin. (55  The Commission considers that Article 4 (2) of the Agreement on Textiles and Clothing could provide the basis for an action for all Community textile exports to the US which will or may be subject to the quantitative restrictions imposed by the US on fibre producers. This situation is expressly provided for by Article 4 (2), which states that: ‘the introduc- tion of changes [...] in rules [...] in the imple- mentation or administration of those restrictions notified or applied under this Agreement should not: [ ...] adversely affect the access available to a Member [ ...] or disrupt trade under this Agree- ment’. (6)  The Commission also considers that a significant aspect of the problem lies in the requirement to label the products in question as originating in the country which produced the loom-state fabric and not in the European Community or one of its Member States. This practice is likely to turn the US consumer away from Community exports of the textiles in question because he is no longer able to identify them. Hence the Commission considers () OJ No C 351, 22. 11. 1996, p. 6.