OREANDA-NEWS. December 08, 2009. Belarus will lift non-tariff restrictions from trade with Russia and Kazakhstan as from 1 January 2010, Deputy Prime Minister of Belarus Andrei Kobyakov told a session of the House of Representatives of the National Assembly of Belarus, reported the Official website government.by.

The Vice Premier remarked that at present Russia and Kazakhstan do not use non-tariff regulations in their trade with Belarus the way the World Trade Organization understands them. “Belarus is also expected to abolish non-tariff regulations measures in the mutual trade with Russia and Kazakhstan as from 1 January 2010,” he said. According to the Vice Premier, Belarus has managed to preserve the procedures used to import alcohol products, tobacco goods, fish and seafood unchanged. These commodities are imported to Belarus only by authorized economic operators.

Andrei Kobyakov explained that the WTO understands non-tariff regulations as quantity restrictions and their equivalents, other prohibitions and economic restrictions in foreign trade. These terms are laid down by the Customs Union agreement on unified non-tariff regulations. According to the Vice Premier, the single system of non-tariff regulations will not substantially affect the export and import of commodities to and from Belarus. “Once the formation of the single customs territory is over by 1 July 2010 the refusal of the parties to use quantity restrictions and their equivalents in the mutual trade will be legalized,” said Andrei Kobyakov.

A united system of prohibitions and restrictions, which does not essentially differ from the system Belarus uses at present, will be used in trade with third countries. Andrei Kobyakov remarked that in addition to existing restrictions based on non-economic reasons the licensing of medications import will be introduced and the control over the import of precious metals and stones will be stepped up.

The Customs Code of the Customs Union does not principally diverge from the regulations set by the customs legislation of Belarus with the exception of some points, Andrei Kobyakov said.
The Customs Code of the Customs Union of Belarus, Russia and Kazakhstan will come into force on 1 July 2010. “Before the relevant decision is adopted by the heads of state, the customs clearance will be carried out in the country where the importer or exporter of goods is registered. It means that until that time the so-called principle of national residency will be used,” Andrei Kobyakov said.

In his words, the Customs Code will regulate customs procedures of customs warehouses and free customs zones in line with separate international agreements. The Customs Union members are expected to sign the relevant agreements by 1 July 2010.

The terms of activities of customs agents, customs carriers and authorized economic operators significantly differ in the Customs Code of the Customs Union and the Belarusian legislation.

Andrei Kobyakov said that the Customs Code also introduces different regulations for the work of duty free shops.

Tariff rates will be increased in respect of 6.7% of commodity items in the Customs Union, Vice Premier said. According to Andrei Kobyakov, 74.6% of commodity items will not be exposed to increase in tariff rates in Customs Union, tariffs for 18.7% of commodity items are likely to be reduced.

On the whole the three countries have reached a high level of unification of customs tariffs. Belarus has so far unified 95% of duties with Russia. Russia and Kazakhstan have unified 38% of duties. Bearing in mind the high level of Belarus-Russia unification, no big changes are expected to take place in Belarus after the unified customs tariffs take effect on 1 January 2010, Andrei Kobyakov stressed.

In his words, the introduction of the unified customs tariffs within the Customs Union and the delegation of the responsibility for all tariff matters to the Customs Union Commission are the key moments of the new integration association. “What are the benefits for Belarus here? The import regulated by the unified customs tariffs account for 34.1% of the total. The rest is the import from the CIS which is a free trade zone,” Andrei Kobyakov said. He emphasized that the Russian energy constitutes half of Belarus’ import from the CIS.

The procedures of distribution of duties in the Customs Union will be launched in a trial mode as from 1 April 2010, Deputy Prime Minister of Belarus said.

The procedures of payment and distribution of import customs duties between Belarus, Russia and Kazakhstan is an issue of high importance for the Customs Union member states, Andrei Kobyakov noted. The sides are continuing developing the common tariff policy. Its approval is one of the eight conditions for creating a uniform customs territory and Customs Union.

According to Andrei Kobyakov, approaches relating to this issue have been already developed. The Russian side is currently assessing and working on these issues. “We have agreed that we will have a closer look at these issues after two sessions of the Intergovernmental Council in November-December 2009. The heads of governments have been instructed to launch the procedure in a testing mode on 1 April 2010,” the Deputy Prime Minister stated.

Belarus has accepted the terms of raising duties on cars in the Customs Union taking into account the tariff protection of trucks, passenger and agricultural vehicles, Andrei Kobyakov said.

In June 2009 the Customs Union countries determined major regulations of the unified customs tariffs and terms of raising customs duties on certain commodity groups. “Initially Russia and Kazakhstan did not support Belarus’ proposal to increase customs duties on tractor trucks and the proposal to keep the customs duties on used buses and other automobiles at the same level.

Kazakhstan flatly refused to go for these radical changes of customs duties. At the same time Belarus disagreed with the idea to raise customs duties on cars. But a way out has been found. The three countries decided to enter the WTO as a single bloc, which is extremely advantageous for Belarus. It is exactly what we have been insisting on for the last few years,” stressed Andrei Kobyakov.

This is why a package decision was made to raise duties on cars (Russia’s proposal). Following Belarus’ proposal it was decided to raise duties on truck tractors, trucks, machine-tool equipment and electric motors.

The reconciliation of customs duties on means of transportation was the most complicated thing when the unified customs tariffs were formed, remarked the Vice Premier. In view of this fact the heads of government of the Customs Union countries made the principal decision that “At the start of the Customs Union all mechanical engineering companies in its territory should have adequate, serious level of tariff protection”.

For Belarus cars are the only commodity group, changing customs duties on which can substantially affect interests of citizens. “The decision has substantial cons for us but it also offers undeniable economic benefits for the present and the future,” believes Andrei Kobyakov.
When the three countries were developing the unified customs tariffs in the Customs Union, Belarus managed to secure higher tariffs for heavy haulers, buses, trucks, tractors and other equipment, Deputy Prime Minister said.

The customs duties on the goods that Belarus is interested in will be reduced. These are raw materials for pharmaceutical and paint industries, caoutchouc and some kinds of technological equipment.

Belarus also would like to preserve the existing duties on meat and dairy products, some kinds of steel products, chemical fiber, washing machines and other goods which are produced in this country.

According to Andrei Kobyakov, the sides have adopted a list of sensitive commodities for each country. It includes 1,141 positions. Some 632 positions are important for Belarus. The duties on these commodities will not be changed. Belarus have the right of veto on them, Andrei Kobyakov underscored.

Customs duties on cars and other goods imported by individuals in the Customs Union should be coordinated before 1 July 2010, Deputy Prime Minister said.

“The level of the customs duties on cars has been already adopted. The unified customs tariff will come into effect on 1 January 2010, but it deals with legal bodies only,” said Andrei Kobyakov.

What concerns individuals, the relevant rules will be considered during the separate talks that should be finished before 1 July 2010.

Speaking about the customs duties for legal bodies, Andrei Kobyakov said that they will be similar to those in Russia. “I am referring to the customs duties, but I want to emphasize that Belarus has value added tax and excise tax preferences that have not been abolished,” said Andrei Kobyakov.

The Presidents of Belarus, Russia and Kazakhstan have set the task to develop the legal framework of the single economic space as soon as possible, Vice Premier told.

“On 18-20 December the heads of state will arrange a meeting to hear out Customs Union Commission’s report about the terms and procedures regarding the preparation of the legal framework of the single economic space,” Andrei Kobyakov said.

The Customs Union is advantageous to Belarus. It is the continuation of Belarus’ consistent policy to develop the relations with the main trading and economic partners. “The Customs Union is advantageous to all commodity producers including auto-industry, agribusiness and other areas. The partners have adopted such a package of the agreements which benefit commodity producers of the three countries,” Andrei Kobyakov said.

According to Andrei Kobyakov, there are no serious antagonistic disagreements between the Customs Union’s commodity producers. On the contrary, they closely cooperate with each other.
The Customs Union will serve as an instrument to solve problems in mutual trade, Andrei Kobyakov said.

We cannot say that absolutely all problems will magically disappear. Yet we will have an instrument that will allow us to solve all these issues in a civilized way, Andrei Kobyakov said.

As for the measures of technical regulation, we are now working to make sure they will not become an instrument in promoting somebody’s economic interests. “On the other hand, we need to understand that problems in mutual trade are unavoidable even in such developed integration organizations as for example European Union, but they are settled in a civilized way,” Andrei Kobyakov said.

Asked whether the Customs Union can create problems to Belarusian companies, for example, dairy industry, in terms of advancement to the European market, the Vice Premier assured that the Customs Union agreement would not impede the Belarusian export and would not create any restrictions in the area.

When asked on how hard the situation would be for those Belarusian companies that are to compete with the Russian and Kazakh companies manufacturing the same products, Andrei Kobyakov stated that Belarus has always been open for the Russian and Kazakh goods as the countries constitute a free trade zone. “The other thing is that there are several issues that are not properly regulated, that allow advancing national goods at the local level,” the Vice Premier said. But we are working on a legal base to secure equal conditions for the goods produced in the three countries,” Andrei Kobyakov said.

When asked what consequences there would be if the countries fail to fulfill the Customs Union commitments and whether there would be any economic sanctions in this case, Andrei Kobyakov noted that there are no such sanctions. “No one is forced to join the Customs Union. A refusal of closer integration does not guarantee we will able to preserve the present level of integration. Therefore we should either move forward or think of some other way of building up our economic policy,” the Vice Premier said.