On 16 December 2011, Russia cleared the final hurdle to become a WTO
member. WTO Ministers adopted Russia’s WTO terms of entry at the 8th
Ministerial Conference in Geneva. Russia will have to ratify the deal
within the next 220 days and would become a fully-fledged WTO member 30
days after it notifies the ratification to the WTO.
As part of the accession accord, Russia has agreed to undertake a
series of important commitments to further open its trade regime and
accelerate its integration in the world economy. The deal offers a
transparent and predictable environment for trade and foreign
investment.
From the date of accession, the Russian Federation has
committed to fully apply all WTO provisions, with recourse to very few
transitional periods (see details below). The Russian Federation’s
commitments will include the following:
Market access for goods and services
As part of the accession, Russia concluded 30 bilateral
agreements on market access for services and 57 on market access for
goods.
Market access for goods — tariff and quota commitments
On average, the final legally binding tariff ceiling for the Russian Federation will be 7.8% compared with a 2011
1 average of 10% for all products
2:
- The average tariff ceiling for agriculture products will be 10.8%, lower than the current average of 13.2%
- The ceiling average for manufactured goods will be 7.3% vs. the 9.5% average today on manufactured imports.
Russia has agreed to lower its tariffs on a wide range of
products. Average duties after full implementation of tariff reductions
will be:
- 14.9% for dairy products (current applied tariff 19.8%)
- 10.0% for cereals (current applied tariff 15.1%)
- 7.1% for oilseeds, fats and oils (current applied tariff 9.0%)
- 5.2% for chemicals (current applied tariff 6.5%)
- 12.0% for automobiles (current applied tariff 15.5%)
- 6.2% for electrical machinery (current applied tariff 8.4%)
- 8.0% for wood and paper (current applied tariff 13.4%)
Final tariffs will be bound at zero for cotton and information
technology (ITA) products (current applied tariff on ITA products is
5.4%).
The final bound rate will be implemented on the date of
accession for more than one third of national tariff lines with another
quarter of the tariff cuts to be put in place three years later. The
longest implementation period is 8 years for pork, followed by 7 years
for motor cars, helicopters and civil aircraft.
Tariff rate quotas (TRQs) would be applied to beef, pork,
poultry and some whey products. Imports entering the market within the
quota will face lower tariffs while higher duties will be applied to
products imported outside the quota.
The in-quota and out of quota rates are listed below with the out of quota rates in parentheses:
- For beef 15% (and 55%)
- For pork zero (and 65%). The TRQ for pork will be replaced by a flat top rate of 25% as of 1 January 2020.
- 25% (and 80%) for some selected poultry products
- 10% (and 15%) for some whey products
- Some of these quotas are also subject to member-specific allocations
Market access for services
The Russian Federation has made specific commitments on 11 services sectors and on 116 sub-sectors.
On telecommunications, the foreign equity limitation (49%)
would be eliminated four years after accession. The Russian Federation
also agreed to apply the terms of the WTO’s Basic Telecommunications
Agreement.
Foreign insurance companies would be allowed to establish branches nine years after Russia accedes.
Foreign banks would be allowed to establish subsidiaries. There
would be no cap on foreign equity in individual banking institutions,
but the overall foreign capital participation in the banking system of
the Russian Federation would be limited to 50% (not including foreign
capital invested in potentially privatized banks).
On transport services, the Russian Federation made commitments
in maritime and road transport services, including the actual
transportation of freight and passengers.
On distribution services, Russia would allow 100% foreign-owned
companies to engage in wholesale, retail and franchise sectors upon
accession to the WTO.
Export duties
Export duties would be fixed for over 700 tariff lines,
including certain products in the sectors of fish and crustaceans,
mineral fuels and oils, raw hides and skins, wood, pulp and paper and
base metals.
General commitments on market access
Quantitative restrictions on imports, such as quotas, bans,
permits, prior authorization requirements, licensing requirements or
other requirements or restrictions that could not be justified under
the WTO provisions would be eliminated and not (re) introduced.
Railway transportation charges on goods in transit would, by 1
July 2013, be applied in a manner which conforms with the WTO
provisions. The Russian Federation would apply the same rail
transportation charges to imported products as they do to similar
products moving between domestic locations. Regulated railway tariffs
for transit of goods would be published before their entry into force.
From the date of accession, importers of alcohol,
pharmaceuticals and some products with encryption technology would not
need import licences.
Upon accession, the Russian Federation would apply the Custom
Union Generalised System of Preferences scheme (CU GSP) for developing
and least-developed countries. 152 developing countries and
least-developed countries benefit from the CU GSP.
Under this scheme, the import duties applicable to products
eligible for tariff preferences and originating from developing
countries were at the level of 75% of the MFN duty rates and from
least-developed countries at the level of 0%.
The Russian Federation would reform its tariff regime for sugar in 2012, with a view to further liberalisation.
By the date of accession, any tariff exemption for space equipment would be provided on a Most Favoured Nation basis.
No licences would be required for imports of more than a dozen
encryption technology products (the list includes electronic digital
signature devices, personal smart-cards or wireless radio equipment).
For those products, any existing import restrictions would be
eliminated. No new restrictions, including experts’ evaluations,
approvals, and licences, would be adopted or applied. For those
encryption technology related products needing an import licence,
expert evaluation and approval would only be needed once.
Products including alcohol, wood and meat would be subject to
measures requiring their declaration and/or entry at designated customs
checkpoints. Any measures contrary to the WTO Agreement would be
eliminated as of the date of accession. The Russian Federation would
not apply country-specific customs procedures.
The Russian Federation would apply all its laws, regulations
and other measures governing transit of goods (including energy) in
conformity with GATT and WTO provisions. From accession, all laws and
regulations regarding the application and the level of charges and
customs fees imposed in connection with transit would be published.
The Russian Federation would review market access requirements
for the establishment of direct branches of foreign banks and
securities firms in the context of future negotiations on the accession
of the Russian Federation to the OECD or within the framework of the
next round of WTO multilateral trade negotiations.
In its participation in preferential trade agreements, Russia
would observe the provisions of the WTO Agreement without any
differentiating between those agreements already in effect upon
accession and those which would come into effect in the future.
Government Procurement Agreement
The Russian Federation intends to join the WTO Government
Procurement Agreement (GPA) and would notify this intention to the WTO
Government Procurement Committee at the time of accession. Russia would
become an observer to the GPA and would initiate negotiations for
membership within four years of its accession. Russian government
agencies would, upon accession, award contracts in a transparent
manner.
Industrial and agricultural subsidies
The Russian Federation would eliminate all its industrial
subsidies programmes or modify them so that any subsidy provided would
not be contingent upon exportation or upon the use of domestic over
imported goods. The Russian Federation would notify its subsidies to
the WTO and would not invoke any of the provisions of Articles 27 and
28 of the WTO Agreement on Subsidies and Countervailing Measures.
The total trade distorting agricultural support would not
exceed USD 9 billion in 2012 and would be gradually reduced to USD 4.4
billion by 2018.
To avoid excessive concentration of support on individual
products, from the date of accession to 31 December 2017, the annual
agricultural support going to specific products would not exceed 30% of
the agriculture support that is not for specific products.
All agricultural export subsidies will be bound at zero.
The VAT exemption applied to certain domestic agricultural products would be eliminated upon accession.
Pricing of energy
Producers and distributors of natural gas in the Russian
Federation would operate on the basis of normal commercial
considerations, based on recovery of costs and profit.
The Russian Federation would continue to regulate price
supplies to households and other non-commercial users, based on
domestic social policy considerations.
Sanitary and phytosanitary measures (SPS) and technical barriers to trade (TBT)
All SPS measures would be developed and applied in the Russian
Federation and the Custom Union, in accordance with the WTO Agreement.
The Russian Federation would ensure that all legislation
related to technical regulations, standards and conformity assessment
procedures complies with the WTO TBT Agreement.
The Russian Federation would develop and apply international
standards on SPS measures through membership and active participation
in the Codex Alimentarius, the World Organization for Animal Health
(OIE) and the International Plant Protection Convention.
The reasons for suspension, cancellation, or refusal of an
import permit would be consistent with international standards,
recommendations, and guidelines as well as the WTO SPS Agreement.
The Russian Federation would negotiate veterinary export
certificates that include requirements different from those of the
Custom Union if an exporting country made a substantiated request prior
to 1 January 2013 to negotiate such a certificate.
Except in case of serious risks of animal or human health,
Rosselkhoznadzor, the Federal Service for Veterinary and Phytosanitary
Surveillance, would not suspend imports from establishments based on
the results of on-site inspection before it had given the exporting
country the opportunity to propose corrective measures. Rosselkhoznadzor
would send a preliminary report to the competent authority of the
exporting country for comments.
The Russian Federation would use international standards for
the development of technical regulations unless they were an
ineffective or inappropriate means for achieving the pursued
objectives.
By the end of 2015, mandatory requirements for
telecommunication equipment used in public networks would be limited to
the requirements contained in technical regulations adopted
consistently with the Eurasian Economic Community and Custom Union
agreements.
The Russian Federation would regularly review its lists of
products subject to obligatory certification or declaration of
conformity, as well as all the technical regulations applied on its
territory (Custom Union and Eurasian Economic Community included) to
ensure that they remained necessary to achieve the Federation’s
objective, in accordance with the WTO TBT Agreement.
Certified accreditation bodies would be replaced by a single
national accreditation body no later than 30 June 2012. The name and
other information regarding this body would be published on the
Rosstandart website and the website of the Custom Union Commission.
Trade-related investment measures
The Russian Federation would ensure that all laws, regulations
and other measures related to the Agreement on Trade-Related
Investment Measures would be consistent with the WTO provisions.
All WTO-inconsistent investment measures, including
preferential tariffs or tariff exemptions, applied in relation to the
existing automobile investment programmes and any agreements concluded
under them would be eliminated by 1 July 2018. No other trade related
investment measures inconsistent with the WTO Agreement may be applied
after Russia’s accession to the WTO.
Protection of trade-related intellectual property
The Russian Federation would fully apply the provisions of the
WTO Agreement on Trade-related Aspects of Intellectual Property Rights
including provisions for enforcement, without recourse to any
transitional period.
The Russian government would continue to take actions against
the operation of websites (with servers located in the Russian
Federation) that promote illegal distribution of content protected by
copyright or related rights.
The Russian Federation would investigate and prosecute
companies that illegally distribute objects of copyright or related
rights on the Internet.
By the time of its accession, the Russian Federation would
apply all rules of the Berne Convention for the Protection of Literary
and Artistic Works.
Transparency
The provisions of the WTO Agreement would be applied uniformly
throughout the Russian Federation territory, including in regions
engaging in frontier traffic, special economic zones and other areas
where special regimes for tariffs, taxes and regulations could be
established.
All legislation affecting trade in goods, services and
intellectual property rights would be published promptly, consistent
with WTO requirements. The Russian Federation would regularly update
its official publications including websites and make these laws readily
available to WTO members, individuals and enterprises.
To improve access to official publications, the Russian
Federation would establish an enquiry point providing assistance to
members and all other stakeholders.
In particular, the Russian Federation would publish all
legislation, affecting trade in goods, services, or intellectual
property rights, prior to their adoption and would provide a reasonable
period of time, no less than 30 days, for members to comment, except
for emergency cases, national security, monetary policy, measures whose
publication would impede law enforcement, be contrary to the public
interest, or prejudice the commercial interest of particular public or
private enterprises. No legislation affecting trade in goods, services
or intellectual property rights would become effective prior to
publication.
The Russian Federation would provide annual reports to WTO
members on developments in its on-going privatization programme for as
long as it would be in existence.
Lists of goods and services subject to state price controls
would be published in the Rossiiyskaya Gazeta from the date of
accession. Russia would apply price controls on certain products and
services, including natural gas, raw diamonds, vodka, water supply
services, gas transportation services, baby food, medical goods, public
transport services and railway transportation services. Price control
measures would not be used for purposes of protecting domestic
products, or services provided.
Functioning of the Custom Union between Russia, Kazakhstan and Belarus
The Custom Union between Russia, Kazakhstan and Belarus was
created on 1 January 2010. All customs borders were removed between the
three countries on 1 July 2011.
From 1 January 2012, the three states would have a single economic space.
The Russian Federation would publish any Custom Union
legislation before adoption and would provide a reasonable period of
time for WTO members and all stakeholders to comment to the competent
Custom Union Body.
Notes :
1. Applied duties refer to the Common External Tariff of the Customs Union in June 2011.
2. Averages are culculated following the methodology used in the
World Tariff Profiles.
