Why Verkhovna Rada delays harmonization of customs tariffs with the EU?
MPs of the Ukrainian parliament plan to adopt next bunch of European integration laws necessary for trading rapprochement with the EU during the next plenary week. Some of them, as we know, have been already adopted. In the light of European integration everyone was concerned with an answer to the question: how and by what customs regulations will we work with the European Union? The answer was as follows. The Ukrainian parliament has adopted the bill No. 2105a “On Amendments to the Customs Tariff of Ukraine” (new edition) in the first reading. But the analysis of the document showed: all the joy was premature – it only legitimizes the Ukrai-nian customs rapprochement with WTO-legislation, while the customs rules for the European integration are just being written. The preview of the draft bill was only held in the specialized parliamentary committee. In its turn, the bill No.2105a, as indicated on the parliament’s website, is designed to bring the legislation into conformity with the provisions of the International Convention on the Harmonized System of Inventory and Products Coding, which was joined by Ukraine through the creation of the Customs Tariffs, based on a new version of the Ukrainian classification of products of foreign economic activity, created on the basis of the Harmonized System of Inventory and Products Coding from 2012, the Combined Nomenclature of the European Union on the execution of the tariff commitments made during the negotiations on Ukraine’s accession to the WTO.
Serhii TERIOKHIN: “The best thing that Ukraine could do for ratification of the agreement on the establishment of the FTA is to solve the political issue”
The Day asked Serhii TERIOKHIN, member of the Ukrainian parliament, former chairman of the Committee on Taxation and Customs Policy, to comment on this bill.
“It does not change anything. Only by a stretch it could be considered as such that facilitates the European integration. It does not contain any provisions for convergence of the Ukrainian and European legislation. When Ukraine joined the WTO, it ratified the protocol and a proposal to go with it (consolidated tariff proposal from Ukraine, which indicates the codes for products and duty rates based on the codification of 2007). After that the international codification changed in 2012, according to this protocol, we had to annually reduce customs rates. We owe the WTO to introduce changes to the internal law (‘On Customs Tariff in Ukraine’), but the protocol, as an international agreement, has been effective in all countries of the WTO. This means that the customs service used all the rates (as contained in the bill approved in the first reading) for five years already. Thus, the adoption of this law is merely a technical move that was taken in order to adjust the domestic legislation with the international treaty.
“The only aspect that wasn’t safe in it was doubling of the full rate of customs tariff. After all, these rates did not apply to trade with the WTO and concerned only the 15 countries with which Ukraine has free trade agreements or most favored nation status, as in case with Belarus or Kazakhstan. When a person brings something from these countries he has to pay twice as much. We eliminated this provision from the bill, as well as a number of other ‘wishes’ of lobbyists of certain business interests…
“We will still introduce more changes to the customs legislation and will make the appropriate changes to the Customs Code to trade with the EU. In this regard, it is very important to establish a uniform procedure for determining the customs value of goods, because customs officials do as they please today. Thus, we get bribery. Besides, it is important to implement mechanisms of post-audit control to unload the customs. The rules of free transit are also of great importance. After all, there is a great number of phytosanitary, veterinary, and many other standards. We should remove all the barriers on the border with the EU to trade effectively. It will take years to make all these changes. A lot needs to be changed in the Customs Code. Now the parliamentary committee has already considered a bill that introduces the appropriate changes. I think that by the end of September – early October it will be offered for the parliament’s consideration. The most important thing for rapprochement of the Ukrainian and European markets is not in the customs plane. If everything goes well in Vilnius (and I hope it will), the parliaments of the 27 EU countries will have to ratify this agreement. In Ukraine it sometimes takes from five to seven years before an international law gets ratified. In my opinion, the best thing that Ukraine could do for ratification of the agreement on the establishment of the FTA is to solve the political issue of Tymoshenko. Otherwise, there is a chance that some country would block the adoption of the Association Agreement. A striking example of how it can happen is Turkey, where human rights problems lead it to the EU for the past 30 years.”
By Natalia BILOUSOVA, The Day