10.7.2001 Official Journal of the European Communities L187/31 COMMISSION REGULATION (EC) No 1394/2001 of 9 July 2001 establishing administrative procedures for the 2002 quantitative quotas for certain products origin- ating in the People's Republic of China THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EC) No 520/94 of 7 March 1994 establishing a Community procedure for adminis- tering quantitative quotas ('), as last amended by Regulation (EC) No 138/96 (3, and in particular Article 2(3) and (4), Article 6(3), Articles 13, 23 and 24 thereof, Whereas: 1) Council Regulation (EC) No 519/94 of 7 March 1994 on common rules for imports from certain non-member countries and repealing Regulations (EEC) No 1765/82, (EEC) No 1766/82 and (EEC) No 3420/83 (%), as last amended by Regulation (EC) No 1138/98 (%), introduced annual quantitative quotas for certain products origin- ating in the People's Republic of China listed in Annex II to that Regulation. The provisions of Regulation (EC) No 520/94 are applicable to those quotas. The Commission accordingly adopted Regulation (EC) No 738/94 (%), as last amended by Regulation (EC) No 983/96 (%), laying down general rules for the imple- mentation of Regulation (EC) No 520/94. These provi- sions apply to the administration of the above quotas subject to the provisions of this Regulation. Certain characteristics of China's economy, the seasonal nature of some of the products and the time needed for transport mean that orders for products subject to quota are generally placed before the beginning of the quota year. It is therefore important to ensure that adminis- trative constraints do not impede the realisation of the planned imports. In order not to affect the continuity of trade flows, the arrangements for allocating and admin- istering the 2002 quotas should accordingly be adopted before the start of the quota year. After examination of the different administrative methods provided for by Regulation (EC) No 520/94, the method based on traditional trade flows should be adopted. Under this method the quotas are divided into L 66, 10.3.1994, p. 1. L 21, 27.1.1996, p. 6. L 67, 10.3.1994, p. 89. L 159, 3.6.1998, p. 1. L 87, 31.3.1994, p. 47. L 131, 1.6.1996, p. 47. two portions, one of which is reserved for traditional importers and the other for other applicants. This has proved to be the best way of ensuring the continuity of business for the Community importers concerned and avoiding any disturbance of trade flows. The reference period used for allocating the portion of the quota set aside for traditional importers in the previous Regulation on the administration of these quotas cannot be updated. The year 2000 was character- ised by certain distortions, in particular a more than twofold increase of applications from one Member State, which resulted in substantially reduced individual quota allocations to all non-traditional importers in all Member States. The years 1998 or 1999 are, thus, the most recent years representative of the normal trend of trade flows in the products in question. Traditional importers must, therefore, prove that they have imported products originating in China and covered by the quotas in question in the years 1998 or 1999. It has been found in the past that the method provided for in Article 10 of Regulation (EC) No 520/94, which is based on the order in which applications are received, may not be an appropriate way of allocating that portion of the quota reserved for non-traditional impor- ters. Consequently, in accordance with Article 2(4) of Regulation (EC) No 520/94, it is appropriate to provide for allocation in proportion to the quantities requested, on the basis of a simultaneous examination of import licence applications actually lodged, in accordance with Article 13 of Regulation (EC) No 520/94. It has been found that the unusual increase of applica- tions lodged for the portion of the quota set aside for non-traditional importers is due to multiple licence applications from companies who do not effectively operate as separate importers, but which have been established as separate legal entities only for the purpose of being able to submit additional applications. Regula- tion (EC) No 520/94, in particular recital 5 and Article 5 thereof, requires the Commission to ensure fair access to quotas and that import licences be issued for economic- ally significant quantities. To allocate the non-traditional quota in line with these principles, the administrative procedures should be amended. The Commission