News from the ‚other side‘ – what is currently happening in the Eurasian region and its adjoining territories?

International politics tend to influence the way we look at public administrations, including regulatory and executive bodies in the field of customs. The isolating trends currently perceived do not, however, mean that everything is silent at the other end of the table. Let us look at a few trade and customs aspects involving the Eurasian region below.

On January 1 2015, the Treaty on the Eurasian Economic Union (‘EAEU’) has become effective, replacing the Eurasian Economic Community. The Treaty confirms the creation of an economic union that provides for free movement of goods, services, capital and labor and pursues coordinated, harmonized and single policy in the sectors determined by international agreements within the Union, such as energy, transportation, agricultural policy, macroeconomic policy and financial market regulations. Another important area is the creation of a common market for pharmaceutical and medical products. In order to do so, several technical regulations have been enacted with a view to replacing the currently prevailing national ones (examples hereto are regulations in the field of security of medical products and that of motor vehicles).

The EAEU is an international organization for regional economic integration and as such, further fosters the integration already started by the creation of the RuBeKa Customs Union among its members. Parties to the EAEU are Russia, Kazakhstan, Belarus as well as new member Armenia. Furthermore, the Kyrgyz Republic signed an association agreement in December 2014, envisaging a deepening integration in the region.

As a first step, Kyrgyzstan will apply the customs tariff nomenclature of the Customs Union and will align its duty rates thereto. Furthermore, it is envisaged to relax customs controls on the Kazakh / Kyrgyz border as of May 2015.

Armenia as a fully-fledged member of the EAEU and the RuBeKa Customs Union applies the union customs code and all associated protectionist measures including import quotas and anti-dumping measures as of 2015.

Among the latter, the EAEU recently prolonged the application of anti-dumping duties on forged cylinders for rolling mills originating in the Ukraine. Interestingly, according to the EAEU, despite the anti-dumping measure already in force since 2011, analysis showed that the price of forged cylinders originating in the Ukraine was two times lower, than that of the same product of exporters in other countries within the period of 2013. Having analyzed the impact on economic operators of the RuBeKa Customs Union, the decision has been made to prolong the measure until 2019.

At the same time, the EAEU is looking at reshaping its customs code. Also, efforts are made to implement and harmonize the existing electronic measures applied to ensure information security with a view to enhance the automatic/electronic registration/filing of customs declarations and the electronic release of goods in conjunction with relevant customs procedures. It is envisaged that by 1 January 2016, the administration of all foreign trade operations would be conducted in line with the new codex of the EAEU.

On this occasion, the EAEU organized an exchange with representatives of businesses and business unions of the Czech Republic and Hungary early February 2015 to discuss matters relating to the expected changes in transit and temporary import procedures as well as electronic declarations.

Streamlining procedures from within is a key to the successful functioning of the EAEU, even though individual member states of the Customs Union may face trade-related challenges elsewhere. One of them is the anti-dumping regime, the specifics of which are that it focuses on exporters’ activity on a country by country, rather than on a Customs Union basis.

In EU terminology, a product is considered as being dumped if its export price to the EU is less than its normal value, there is a material injury to the Community industry producing the like product caused by the dumped imports and any measures taken must not be against Community interest.

Having performed the necessary investigations, the EU recently adopted definitive anti-dumping duties for certain welded tubes and pipes of iron or non-alloy steel originating in Belarus and Russia among others. Measures will be in effect for five years, unless an expiry review is initiated. On the other hand, the procedure has been terminated with respect to products originating in the Ukraine.

Looking further to the East, Uzbekistan and Azerbaijan envisage the strengthening of customs cooperation aided by information and communication technology to facilitate customs controls.

It is apparent that customs and improvement efforts never sleep in the region and the trade community is looking at the changes with great interest. After all, Век живи — век учись – live and learn as the saying goes.

 

 

 

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