Page:Agreement relating to Malaysia (1963).djvu/228



1. (1) The Federal Government, in order to facilitate the maximum practicable degree of economic integration of the territories of Malaysia, while taking account of the interests of the entrepot trade of Singapore, Penang and Labuan and those of existing industries in Malaysia, and the need to ensure a balanced development of these territories, shall progressively establish a common market in Malaysia for all goods or products produced, manufactured or assembled in significant quantities in Malaysia, with the exception of goods and products of which the principal terminal markets lie outside Malaysia. 1. (2) Where the same protective duties or revenue duties are applicable throughout Malaysia in the case of any class of goods or products, then no tariff or trade barrier or trade restriction or discrimination shall be applied to such goods or products in regard to their circulation throughout Malaysia.

1. (3) The provisions of the preceding sub-paragraph shall not be construed to prevent the imposition of—


 * (a) any special production tax on producers in a low-tariff State which would offset the cost inequalities arising from the differential import duties; or


 * (b) any export duty or export restriction on primary products where the principal terminal markets lie outside Malaysia.

2. (1) The Malayan Government shall take steps to establish by law before Malaysia Day a Tariff Advisory Board to advise the Federal Government generally on the establishment of the common market as defined in paragraph 1 above, including the establishment and maintenance of a common external tariff for the protection (where required) of goods for which there is to be a common market.

2. (2) Appointments to the Board shall be made by the Federal Government but until five years from Malaysia Day the appointment of the Chairman shall require the concurrence of the Singapore Government; the first Chairman shall be appointed as soon as possible after the conclusion of this Agreement. During the first five years, there shall be three Deputy Chairmen, one of whom shall be nominated by the Singapore Government. In appointing members of the Board regard shall be had to the areas and interests involved.