Generalised Scheme of Preferences

Trade topics

Generalised Scheme of Preferences

By removing such import duties, the EU’s GSP helps developing countries to alleviate poverty and create jobs based on international values and principles, including labour and human rights, environment and climate protection, and good governance.

Over 50 years ago, the United Nations Conference on Trade and Development (UNCTAD) asked developed countries to help developing countries integrate into the world economy. The Generalised Scheme of Preferences (GSP) was born. Today, about a dozen countries have GSP mechanisms in place.

Generalised Scheme of Preferences in a nutshell

The European Union’s GSP is widely recognised as the most progressive in terms of coverage and benefits.

The EU's GSP comprises three arrangements:

Standard GSP for low and lower-middle income countries. This means a partial or full removal of customs duties on two-thirds of tariff lines.
GSP+: a special incentive arrangement for sustainable development and good governance. GSP+ slashes these same tariffs to 0% for vulnerable low- and lower-middle income countries that implement 27 international conventions related to labour and human rights, environmental and climate protection, and good governance.
EBA (Everything But Arms): the special arrangement for least developed countries (LDCs), providing them with duty-free, quota-free access to the EU market for all products except arms and ammunition.

Find the arrangement that benefits your country

List of GSP beneficiary countries

GSP statistics: details regarding benefits per regime, country and others

Visit the Access to Markets portal to find the scheme that benefits your country.

Conditions

Developing countries are automatically granted GSP if they:

Are classified as having an income level below 'upper middle income' by the World Bank.
Do not benefit from another arrangement (like a Free Trade Agreement) granting them preferential access to the EU market.
Are on the list of eligible countries.

In addition, if a country applies for GSP+ status, the beneficiary country is required to ratify 27 international conventions, and to cooperate with the European Commission to monitor the implementation of these conventions related to environmental and climate protection, and good governance listed in the GSP Regulation.

LDCs are automatically granted the benefits of the ‘Everything But Arms’ arrangement, even if they have another arrangement in place.

All GSP beneficiary countries have to respect the principles of fifteen core conventions on human rights and labour rights listed in the GSP Regulation.

Monitoring

The EU continuously monitors GSP+ beneficiary countries’ effective implementation of the 27 international conventions on human rights, labour rights, environmental and climate protection, and good governance. This monitoring includes exchanges of information, dialogue and visits, and it involves various stakeholders, including civil society.

The Commission publishes a report on the implementation of GSP every two years, providing information on the progress made by the GSP+ beneficiary countries in implementing the 27 international conventions.

Report for 2020-2022 and its country annexes:

Key facts on the report

Enhanced engagement with other GSP beneficiaries

As announced in Trade for All, the EU has stepped up its engagement with three GSP beneficiary countries: Bangladesh, Cambodia and Myanmar.

The EU is engaging with these countries due to the gravity of alleged shortcomings in respecting core human rights and labour rights standards, as testified by reports from the United Nations, the International Labour Organization, and civil society.

GSP preferences can be removed if beneficiary countries fail to respect core human rights and labour rights. On 12 February 2020, the Commission decided to withdraw part of the tariff preferences granted to Cambodia under the European Union’s Everything But Arms (EBA) trade arrangement due to serious and systematic violations of the human rights principles enshrined in the International Covenant on Civil and Political Rights. See Legal Act and Memo.

As part of the biennial report, a specific report was published on the Enhanced Engagement, which provides details on issues discussed and priorities for further monitoring with the countries concerned.

Impact of GSP

A 2018 GSP mid-term evaluation shows that the EU’s GSP is delivering on its main objectives of contributing to poverty eradication and sustainable development in GSP beneficiary countries.

The evaluation indicates that countries increasingly use the available trade preferences and diversify their exports. Moreover, GSP+ beneficiaries saw an economic incentive for making progress in ratifying and implementing the 27 international conventions required under GSP+.

Between 2014 and 2019, the 27 EU Member States' imports from current GSP beneficiaries utilising any of the existing arrangements increased by 25%, whereas overall imports from third countries increased by 16% over the same period. Imports under EBA even outperformed this, increasing by 47% (from 17.1 billion EUR in 2014 to 25.2 billion EUR in 2019). Imports from LDCs accounted for 2% of the EU’s total imports in 2019; 67% of these imports from LDCs benefitted from EBA preferences.

GSP Review

On 22 September 2021, the Commission adopted a legislative proposal for the EU’s Generalised Scheme of Preferences (GSP) for the period 2024-2034.

The current GSP Regulation is set to expire by the end of 2023. The Commission is proposing to continue the scheme while improving some of its key features. The aim is to respond to the evolving needs and challenges of GSP countries, and to strengthen the scheme’s social, environmental and climate aspects.

The review is based on the 2018 Mid-Term Evaluation (MTE) of GSP, the External Study supporting the Impact Assessment, a Commission Impact Assessment, and the 2020 Open Public Consultation that confirmed the achievements of the EU GSP.

Extension of the current GSP Regulation

In November 2023, the Council of EU Member States and the European Parliament signed an amendment to the existing Generalised Scheme of Preferences (GSP) Regulation, in order to extend the GSP scheme for the period 2024-2027.

As the current scheme is set to expire at the end of 2023, this extension will provide legal certainty to beneficiary countries, and to businesses and operators present in these countries and in the EU. The extension of the current scheme will shortly be published in the EU’s Official Journal, and will take effect the day after its publication.

This will allow GSP beneficiaries to continue enjoying tariff preferences, as the Council and the Parliament have not yet reached an agreement on the Commission's proposal of September 2021 to update the GSP rules. The proposal to extend the current GSP scheme was put forward by the Commission in July 2023.

Involving stakeholders

European Parliament and Council of the European Union

The Commission regularly reports to the European Parliament, and to the Council of the European Union, on GSP matters. The Commission also regularly answers questions from Members of the European Parliament (MEPs). These questions (and responses) and related issues can be found on the European Parliament's website.

The Council is overseeing the GSP through the Working Party on the Generalised System of Preferences.

In addition, the Commission chairs the Expert Group on the Generalised Scheme of Preferences and the Generalised Preferences Committee, which gathers expert representatives from each Member State to oversee and vote on issues related to the GSP.

Industry

The GSP Regulation has several ways to ensure that the interests of European industries are safeguarded:

GSP beneficiaries that become 'upper middle-income' countries are removed from the GSP.
GSP beneficiaries can lose preferences for specific product categories that are deemed to have become sufficiently competitive: suspended tariff preferences for 2020-2022.
Safeguard measures can be requested by EU industry based on evidence that imports from a GSP beneficiary have caused serious economic difficulties for that industry: safeguard measures on rice from Cambodia and Myanmar.

Contact

For any further questions regarding the GSP, please contact TRADE-GSPec [dot] europa [dot] eu (TRADE-GSP[at]ec[dot]europa[dot]eu)