Article 1
1. For the purposes of implementing the tariff preferences laid down in the Agreement: (a) the term "MFN duty" shall mean the duties specified in Part Two of Annex I to Regulation (EEC) No 2658/87. However, it shall not mean a duty set up within the framework of a tariff quota under Article 26 of the Treaty or under Annex 7 to Regulation (EEC) No 2658/87; (b) subject to paragraph 2, the final rate of preferential duty shall be rounded down to the first decimal point. 2. Where the result of calculating the rate of preferential duty is one of the following, the preferential rate shall be considered as a full exemption: (a) 1 % or less in the case of ad valorem duties, or (b) EUR 2 or less per individual euro amount in the case of specific duties. 3. Where the customs duties comprise an ad valorem duty with a minimum and maximum duty, the preferential reduction shall also apply to that minimum and maximum duty. For products listed in Annex I to the Agreement under categories "EP" and "SP", the preferential reduction shall apply only to the ad valorem duty and in accordance with Annex I to the Agreement. If the customs duties comprise more than one specific duty, the preferential reduction shall apply to all these duties and in accordance with Annex I to the Agreement.