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Overseas Territories and the EU

The Overseas Countries and Territories (OCTs) are not considered part of the European Union (EU). However, they are associated to the EU through their link with a Member State. The United Kingdom, The Netherlands, Denmark and France are the only four Member States still with OCTs. The current legal framework governing the EU-OCT association is set out in Part Four of the Treaty (Arts.182-188) and in a number of Council Decisions, most recently Council Decision 2001/822/EC. The basic aim of the EU-OCT association, as set out in Article 182, is 'to promote the economic and social development of the countries and territories and to establish close economic relations between them and the Community as a whole'.

Eleven of the UK's Overseas Territories are included in the Overseas Association Decision: Anguilla, British Antarctic Territory, British Indian Ocean Territory, the British Virgin Islands, the Cayman Islands, the Falkland Islands, Montserrat, Pitcairn, St. Helena and Dependencies, South Georgia and the Sandwich Islands, and Turks and Caicos Islands. Bermuda is not included at its own request.

The legislation contained in the Decision covers six main areas of co-operation:

  • Economic and trade co-operation;
  • Trade development;
  • Trade-related areas such as information technology and the environment;
  • Human and social development;
  • Regional co-operation and integration;
  • Cultural and social development;

    This co-operation is implemented via a three-way Commission/Member State/OCT partnership. Representatives of each party meet annually in an OCT Forum to discuss and further work on the association.

    The OCTs also receive various forms of financial assistance through their association with the EU. The EDF, to which all Member States contribute, provides funds for development projects in the OCTs. Since the first EDF in 1958 there have been nine EDFs, each providing financial assistance for a fixed period of time. The current EDF applicable to the OCTs – the ninth EDF (covering the period 1 March 2001 to 31 December 2007) allocated € 175 million to the OCTs, of which € 20 million is allocated for the Investment Facility managed by the European Investment Bank.

    The UK OCTs received a total of €41 million in national allocations, and had access to the € 27 m regional pot. They have made good use of this pot and are involved in 6 proposals which total € 13 million.

    In addition to the EDF, the OCTs also receive financial assistance from the European Investment Bank’s own resources, from various horizontal budge lines (for example, food and humanitarian aid and health) and under various EU programmes (such as education, research, youth and training).

    The next EDF (EDF 10) begins on 1 January 2008. This time the OCTs have been allocated € 286m, however this figure has yet to be programmed. The OCTs, the Commission and the Member States are working on various proposals, which should be ready for discussion by the end of September 2006.