Report on Supply Chain Compliance 3, no. 5 (March 5, 2020)
The European Commission announced Feb. 12 that Cambodia no longer qualified for preferential trade status under the “Everything But Arms” special arrangement. The arrangement reduces tariffs and duties to zero for all products imported into the EU that are not arms. The arrangement requires that countries adhere to a list of standards and requirements enshrined in several United Nations and International Labour Organization conventions. Those conventions are the:
International Covenant on Civil and Political Rights (1966);
Freedom of Association and Protection of the Right to Organise Convention No. 87 (1948);
ILO Convention (No. 98) concerning the Application of the Principles of the Right to Organise and Collective Bargaining Convention (1949); and
International Covenant on Economic, Social and Cultural Rights (1966).
Cambodia can address the situation and restore the temporarily suspended preferential measures. So far, the Cambodian government has rejected the EU decision and has instead considered tax breaks to help offset the economic fallout for domestic companies.