Foreign Trade Developments in Europe

Localization requirement for duty-free imports of finished vehicles within the Eurasian Economic Union (EAEU) increases
Starting July 1, 2018, the local content requirement for finished vehicles exported from one EAEU member state to another EAEU member increased from 30% to 50% for the vehicle to qualify for duty-free importation. As of July 23, a handful of vehicle makers in Russia, Belarus, and Kazakhstan met the new requirement and were registered in the EAEU duty-free exporter database.
For more information, see “EEU Hits Vehicle Makers with Revised Rates,” July 23, 2018, https://automotivelogistics.media/news/eeu-hits-oems-with-revised-rates.

Eurasian Economic Union (EAEU) reduces duties on imports of finished vehicles from outside the union
On September 1, 2018, the EAEU reduced the duties on imports of finished vehicles exported from states outside the union from 20% to 17%. The import duty rate is expected to decrease to 15% in 2019.
For more information, see “EEU Cuts Import Duties but Trade within Bloc Is in Dispute,” September 5, 2018, https://automotivelogistics.media/news/eeu-cuts-vehicle-import-duties-rates-within-block-remain-unclear.

Caucasus

Armenia prohibits pork and poultry imports from specified Russian regions
On August 28, the Armenian State Food Safety Service issued a ban on imports from several regions in Russia of live pigs, their genetic materials, hides, pork, meat of wild pigs, finished products with pork, horns, hooves, guts, pig feed and additives, live poultry, chicken meat, feathers, fluff, hatching eggs, chicken feed, feed additives, and related polymer and cardboard boxes. The ban was in response to reports of African swine fever and avian flu in Russia.
For more information, see “Armenian Food Safety Watchdog Bans Import of Pork and Poultry from Russia,” August 29, 2018, http://arka.am/en/news/business/armenian_food_safety_watchdog_bans_import_of_pork_and_poultry_from_russia_/.

Azerbaijan applies export subsidies to selected foods and beverages
A Cabinet of Ministers decision in June applied export subsidies of 3% to 6% of the customs value of declared export goods to eggs, peeled peanuts, olive oil, and fruit wines, except for grape wines. These goods were added to the items to which export subsidies already apply, including natural honey, dried fruits, confectionery products, canned vegetables, fruits, soft drinks, liquor, clothes, shoes, silk fabrics, and other woven products. The subsidies will apply until December 31, 2020.
For more information, see “Azerbaijan Expands Export Subsidies,” June 19, 2018, https://www.azernews.az/business/134144.html.

Azerbaijan seeks to ban individual imports of mobile phones for commercial purposes
The Deputy Chairman of the State Customs Committee (SCC) announced in July that the SCC and the Ministry of Transport, Communications and High Technologies sought to prevent imports of mobile phones for personal use that then would be sold commercially.
For more information, see “Azerbaijan Prohibits Individual Imports of Mobile Phones for Sale,” July 11, 2018, https://en.trend.az/business/economy/2927652.html.

Azerbaijan restricts poultry imports from various Russian regions and issues notice regarding cattle imports from Samara region
In August, the Azerbaijan Food Safety Agency imposed a temporary limitation on poultry and poultry products from the Ryazan, Samara, Tula, Rostov, Nizhny Novgorod, Tatarstan, and Chuvashia regions of Russia due to concerns about avian flu. The agency also instructed importers to be aware of World Organization for Animal Health requirements that apply to imports of cattle from the Samara region of Russia. The Samara region reportedly experienced cases of nodular dermatitis.
For more information, see “Azerbaijan Limited Import of Poultry Products from Russia,” August 2, 2018, https://www.azernews.az/business/135688.html.

Azerbaijan and Iran agree to reduce customs tariffs between their ports
The governments of Azerbaijan and Iran announced in September that they would decrease the preferential tariff between their ports in order to enhance economic ties.
For more information, see “Iran, Azerbaijan to Cut Customs Tariffs between Ports,” September 4, 2018, https://www.azernews.az/business/137110.html.

Azerbaijan increases customs duties on imports of potatoes
In September, the Cabinet of Ministers issued a decision stating that the customs duty on imports of potatoes harvested between January 1 and June 30, 2018, would increase from 15% to 30% of the customs value. The new rate will be in effect until October 31, 2018.
For more information, see “Azerbaijan Doubles Customs Duties on Potato Imports,” September 5, 2018, https://news.az/articles/economy/133420.

Trade Facilitation Center will open at Sinig Korpu border crossing on Azerbaijan-Georgia border
The center is being built as part of a European Union (EU) customs improvement project. Its purpose is to expedite the movement of people, goods, and vehicles through the border crossing.
For more information, see “Trade Facilitation Center to Open on Azerbaijan-Georgia Border in Autumn,” September 12, 2018, https://en.trend.az/business/economy/2950528.html.

Azerbaijan engaging in customs reforms
The Azerbaijan State Customs Committee (SCC) announced in September that it had neared completion of the first stage of customs reforms, which reportedly include changes with respect to the relationship between Customs and industry, between Customs and other government bodies, and within Customs. The SCC also has plans to improve information sharing with the customs services of other countries.
For more information, see “First Stage of Customs Reforms in Azerbaijan near Completion (UPDATE),” September 20, 2018, https://en.trend.az/business/economy/2954253.html.

Azerbaijan changes duty and registration requirements for imports of mobile phones
The Cabinet of Ministers issued the “Procedure for Registration of Mobile Devices,” which specifies registration and duty requirements for imported mobile phones. Persons importing phones to the country for sale or business must pay duties and value-added tax (VAT) at the time of importation. Persons who import phones for personal use must register the device and pay duties that vary based on the market value of the phone. Registration must occur within 30 days of importation.
For more information, see “Procedure for Registration of Mobile Devices Changed in Azerbaijan,” September 21, 2018, https://menafn.com/1097467509/Procedure-for-registration-of-mobile-devices-changed-in-Azerbaijan.

Georgia signs free trade agreement (FTA) with Hong Kong
The FTA was signed on June 28. The Georgian government agreed to eliminate 96.6% of its tariff lines on goods from Hong Kong and to give Hong Kong investors a preferential status equivalent to the status of local investors. The FTA will enter into force by the end of 2018.
For more information, see “Georgia, Hong-Kong Sign Free Trade Deal,” June 28, 2018, http://agenda.ge/en/news/2018/1379.

Georgian government exempts imports of timber from value-added tax (VAT) and restricts exports of wooden logs and planks
The purpose is to prevent illegal logging and promote reforestation within Georgia.
For more information, see “Import of Timber Will Be Exempt from VAT in Georgia,” July 26, 2018, http://agenda.ge/en/news/2018/1583.

Georgia to prohibit transits of Russian wheat to Armenia by motor vehicle
The ban reportedly will enter into effect at the end of 2018. The Georgian government has stated that it seeks to impose the ban because of long lines of trucks at the border crossing with Russia.
For more information, see “Georgia Closes Border for Russian Wheat Exports to Armenia,” August 28, 2018, http://vestnikkavkaza.net/news/Georgia-closes-border-for-Russian-wheat-exports-to-Armenia.html; “Ban on Wheat Import/Export by Truck Postponed,” September 17, 2018, http://georgiatoday.ge/news/12302/Ban-On-Wheat-Import-Export-By-Truck-Postponed; and “Ban on Grain Cargo Imports into Armenia via Georgia Motorways Is Postponed until Year’s End,” September 20, 2018, https://news.am/eng/news/471931.html.

Georgian government introduces first draft of new customs code
In September, the Ministry of Finance presented the first draft of a new “European style” customs code. The purpose reportedly is to attract European investment, facilitate Georgia’s integration with European markets, and provide for a stable business environment with simpler and fairer rules. The new code is expected to enter into force on January 1, 2019.
For more information, see “PM Announces New, European Standard Customs Code,” September 6, 2018, http://agenda.ge/en/news/2018/1856, and “Gov’t Presents Draft of New Customs Code,” September 20, 2018, http://agenda.ge/en/news/2018/1876.

Eastern Europe

Belarus increased duties on exports of oil and oil products in July
Council of Ministers Resolution No. 483 of 22 June 2018 increased duties on exports of oil and oil products to destinations outside the Eurasian Economic Union (EAEU). The export duty on crude oil increased from US$131.8 per ton to US$139.1 per ton. The export duty on straight-run gasoline increased from US$72.4 per ton to US$76.5 per ton. The export duty on commercial gasoline increased from US$39.5 to US$41.7 per ton. The export duty on light and medium distillates also increased from US$39.5 per ton to US$41.7 per ton.
For more information, see “Belarus to Raise Export Duties on Oil, Oil Products on 1 July,” June 25, 2018, http://eng.belta.by/economics/view/belarus-to-raise-export-duties-on-oil-oil-products-on-1-july-112926-2018/.

Belarus and Uzbekistan governments sign bilateral trade facilitation and customs cooperation agreements
The agreements provide for information exchange concerning movement of goods and vehicles between the countries as well as customs cooperation and mutual assistance.
For more information, see “Customs Services of Belarus, Uzbekistan Agree to Facilitate Bilateral Trade,” September 17, 2018, http://eng.belta.by/society/view/customs-services-of-belarus-uzbekistan-agree-to-facilitate-bilateral-trade-114822-2018/.

Belarus institutes licensing requirement for exports of flax fiber to most non-EAEU states
Council of Ministers Resolution No. 705 of 28 September 2018 imposed a licensing requirement on exports of flax fiber to countries outside the Eurasian Economic Union (EAEU). The restriction went into effect on October 4, 2018, and will be in place until April 4, 2019. Persons are required to obtain a one-time license from the Ministry of Antimonopoly Regulation in order to export flax fiber to any state outside the EAEU other than members of the Commonwealth of Independent States, Georgia, Vietnam, and Serbia.
For more information, see “Belarus Bans Export of Flax Fiber outside EAEU,” October 2, 2018, http://eng.belta.by/economics/view/belarus-bans-export-of-flax-fiber-outside-eaeu-115273-2018/.

Moldova amended strategic goods law in August
The Moldovan government amended Law No. 1163 of 26.07.2000 on the Control of the Export, Re-Export, Import and Transit of Strategic Goods in August 2018. Amendments enable traders to submit strategic goods authorization applications through an electronic single window system.
For more information, see Law No. 1163 of 26.07.2000 on the Control of the Export, Re-Export, Import and Transit of Strategic Goods,as amended, http://lex.justice.md/md/311550/.

Russia imposes duties on imports of selected U.S. goods
On July 6, the Russian government published an order establishing additional tariffs of 25 to 40% on imports of U.S. goods, including road construction equipment, products in the oil and gas industries, metal processing machinery, and fiber-optics. The new duties went into effect on August 6, 2018.
For more information, see “Russia Introduces Additional Duties on Imports of US Goods,” June 19, 2018, http://www.pravdareport.com/news/russia/economics/19-06-2018/141134-russia_usa_goods-0/; “Russia Raising Tariffs on Vehicle Imports from U.S.,” July 3, 2018, https://www.wardsauto.com/industry/russia-raising-tariffs-vehicle-imports-us; and “Russia Starts Imposing New Taxes on US Goods,” August 6, 2018, http://usa.chinadaily.com.cn/a/201808/06/WS5b67ac21a3100d951b8c8c8b.html.

Russian government lifted prohibition on Belarusian dairy imports
On June 22, the Russian Federal Service for Veterinary and Phytosanitary Surveillance, Rosselkhoznadzor, announced that it had lifted the ban on imports of Belarusian dairy products that it had imposed on June 4, 2018.
For more information, see “Rosselkhoznadzor Lifts Ban on Import of Belarusian Dairy Products,” June 22, 2018, http://eng.belta.by/economics/view/rosselkhoznadzor-lifts-ban-on-import-of-belarusian-dairy-products-approves-list-of-suppliers-112883-2018/.

Russia maintains embargo on transit of Ukrainian foodstuffs through Russia to Central Asia
The Russian president issued a decree in late June 2018 extending the 2016 embargo on transits of specified Ukrainian foodstuffs through the beginning of 2019.
For more information, see “Russia Extends Blockade on Ukraine Goods Headed to Central Asia,” July 2, 2018, https://eurasianet.org/russia-extends-blockade-on-ukraine-goods-headed-to-central-asia.

Russia maintains counter-sanctions on U.S., EU, and others until conclusion of 2019
On July 12, the Russian president issued a decree mandating that Russian counter-sanctions on imports of designated goods from the U.S., the European Union (EU), Norway, Australia, and Canada remain in place until December 31, 2019.
For more information, see “Putin Extends Russian Counter-Sanctions until End of 2019,” July 12, 2018, http://tass.com/politics/1012859.

Rosselkhoznadzor prohibits imports of Belarusian fresh mushrooms
In July, the Russian Federal Service for Veterinary and Phytosanitary Surveillance, Rosselkhoznadzor, issued a ban on imports of Belarusian fresh mushrooms. The ban was issued in response to concerns that the mushrooms were smuggled from Poland, which is subject to a Russian agricultural and food embargo.
For more information, see “Russia Hits Belarus-Poland Mushroom Smuggling with Import Ban,” July 25, 2018, https://iegvu.agribusinessintelligence.informa.com/CO220574/Russia-hits-BelarusPoland-mushroom-smuggling-with-import-ban.

Export duties on crude oil in Russia to end by 2024; value-added tax increases in 2019
In August, the Russian president signed laws that by 2024 will end duties on exports of Russian crude oil and introduce a “negative excise duty” on crude oil processed by Russian refineries. The export duty currently stands at 30%. In addition, the president authorized an increase in the value-added tax (VAT) from 18% to 20% starting in January 2019.
For more information, see “Putin Signs Law to Phase out Russian Crude Oil Export Duty by 2024,” August 8, 2018, https://www.spglobal.com/platts/en/market-insights/latest-news/oil/080818-putin-signs-law-to-phase-out-russian-crude-oil-export-duty-by-2024.

Imports of fruit from Macedonia and Serbia temporarily prohibited in Russia
The Russian Federal Service for Veterinary and Phytosanitary Surveillance, Rosselkhoznadzor, issued the temporary ban on August 15, reportedly in response to detections of the fructicola fungus in Macedonian and Serbian fruit.
For more information, see “Russia to Ban Imports of Fruit from Serbia, Macedonia from Aug. 15,” August 10, 2018, https://www.reuters.com/article/us-russia-macedonia-fruit/russia-to-ban-imports-of-fruit-from-serbia-macedonia-from-aug-15-idUSKBN1KV15J.

Russia requires cars from Estonia and Finland to pay guarantee to cross the border
In September, it was reported that the Russian government had amended customs statutes to require visiting persons who cross the border with more than one non-Russian means of transport registered to their name to pay a guarantee in order to cross the border with the additional vehicles. The amount of the guarantee was not reported.
For more information, see “Russian Law Amend Means Leased Cars Need Guarantee Payment to Cross Border,” September 5, 2018, https://news.err.ee/859021/russian-law-amend-means-leased-cars-need-guarantee-payment-to-cross-border, and “New Russian Car Law Confuses Finnish Customs – Minister Promises Remedy,” September 8, 2018, https://yle.fi/uutiset/osasto/news/new_russian_car_law_confuses_finnish_customs__minister_promises_remedy/10394494.

Rosselkhoznadzor prohibits imports of meat products from Bulgaria
The Russian Federal Service for Veterinary and Phytosanitary Surveillance, Rosselkhoznadzor, stopped the importation of meat products, live pigs, pig embryos, boar sperm, and sheep and goat products from Bulgaria in September. The decision came in response to a discovery of African swine fever in Bulgarian pigs. The ban does not apply to products that are processed in a way that ensures elimination of African swine fever.
For more information, see “Russia Halts Import of Bulgarian Meat Products,” September 10, 2018, https://emerging-europe.com/news/russia-halts-import-of-bulgarian-meat-products/.

Russia allows Kazakhstan to resume exports of fuel
On October 3, the Russian and Kazakhstan governments signed an agreement to allow Kazakhstan to resume exports of car fuel. Since July 2013, Russia had sold petrol to Kazakhstan and waived export duties on the condition that Kazakhstan not resell the fuel for a profit.
For more information, see “Russia Lifts Ban on Export of Kazakstan Fuel,” October 3, 2018, https://eurasianet.org/russia-lifts-ban-on-export-of-kazakstan-fuel.

Russian government lifts prohibition on imports of Belarusian baby food
The Russian Federal Service for Veterinary and Phytosanitary Surveillance, Rosselkhoznadzor, removed a prohibition on imports from the Nesvizh Baby Food Plant on October 3, 2018. Products must be made on October 3 or later and have the necessary electronic veterinary health certificate.
For more information, see “Rosselkhoznadzor Lifts Ban on Imports from Belarus’ Nesvizh Baby Food Plant,” October 3, 2018, http://eng.belta.by/economics/view/rosselkhoznadzor-lifts-ban-on-imports-from-belarus-nesvizh-baby-food-plant-115331-2018/.

Ukraine National Security and Defense Council (NSDC) allows Ukraine defense enterprises to trade in weapons without involvement of state-owned companies
The change resulted from the adoption of the NSDC Decision “On the Improvement of the State Policy in Provision of Ukraine’s Armed Forces and Other Armed Formations with the Defense Products Produced Abroad.” Ukraine producers of arms and military equipment now may export and import military products without using the services of a state-owned intermediary.
For more information, see “Ukraine May Import Weapons without Involving State-Run Companies: NSDC Decision Took Force,” June 26, 2018, https://112.international/politics/ukraine-may-import-weapons-without-involving-state-run-companies-nsdc-decision-took-force-29735.html.

Ukraine Cabinet of Ministers prohibits imports of clinkers from Russia
The ban on clinkers was issued in August 2018. It went into effect in September.
For more information, see “Ukraine Bans Clinker Imports from Russia,” August 30, 2018, http://www.globalcement.com/news/item/8004-ukraine-bans-clinker-imports-from-russia.

Ukraine amends customs code to provide for single window and trade facilitation
The President of Ukraine signed a law in September amending the code. In addition to creating the single window, the amendments simplify customs control procedures, reduce the number of regulatory bodies at border checkpoints and customs clearance locations, and decrease the costs and number of permits associated with exporting goods from Ukraine.
For more information, see “President of Ukraine Petro Poroshenko Has Signed a Law That Introduced Changes to the Customs Code Introducing a Single Window at Customs,” September 29, 2018, https://theqtimes.com/president-of-ukraine-petro-poroshenko-has-signed-a-law-that-introduced-changes-to-the-customs-code-introducing-a-single-window-at-customs/76441/.

Ukraine and Hungary customs services begin sharing information on cross-border movements of vehicles and goods
The information exchange via e-mail began on October 1, 2018. The governments expect the exchange to improve risk assessment and expedite customs control.
For more information, see “Ukraine, Hungary Start Exchange of Information on Vehicles, Goods Transported across Border,” October 2, 2018, https://www.kyivpost.com/ukraine-politics/ukraine-hungary-start-exchange-of-information-on-vehicles-goods-transported-across-border.html.

Ukraine implements Unified List of Dual-Use Goods
The Unified List of Dual-Use Goods went into effect in Ukraine on October 19, 2018. The list identifies the goods that are subject to an export permit issued by the State Service for Export Control of Ukraine (SSECU) for nonproliferation and national security reasons as well as selected goods that are subject to an import permit or transit conclusion. The Unified List is based on the European Union (EU) List of Dual-Use Items. The five national dual-use lists previously in effect in Ukraine became invalid on October 19.
For more information, see “Ukraine Switches to Unified List of Dual-Use Goods Meeting EU Standards in State Export Control System in Oct,” October 2, 2018, https://en.interfax.com.ua/news/economic/535282.html, and “Information Notice on the Entry into Force of the Unified List of Dual-Use Goods,” October 19, 2018, http://www.dsecu.gov.ua/control/uk/publish/article?art_id=55879&cat_id=34940.

Illegal timber export law amended in Ukraine
In early October, the Ukrainian president signed the Act “On Amendments to Certain Legislative Acts of Ukraine Regarding the Preservation of the Ukrainian Forests and Prevent Illegal Export of Unprocessed Timber.” The law increased the penalties for illegal logging and related export activities and enhanced government control over smuggling of forestry products.
For more information, see “Poroshenko Has Signed the Law on Penalties for Smuggling Forest – 24 Channel,” October 3, 2018, https://ktelegram.com/poroshenko-has-signed-the-law-on-penalties-for-smuggling-forest-24-channel/39533/.

State Service for Export Control of Ukraine (SSECU) working to implement Single Window for International Trade
The Single Window system will allow traders to apply for permits or conclusions for military or dual-use trade online and enable rapid electronic communications between the SSECU, interagency application reviewers, and customs authorities in the State Fiscal Service of Ukraine. The SSECU has received a working version of the system funded by the U.S. Department of State-coordinated Export Control and Related Border Security (EXBS) Program and is considering improvements to it over the next six months.
For more information, see “The State Service for Export Control Is Taking Measures to Implement the Electronic System in the Field of State Export Control,” October 12, 2018, http://www.dsecu.gov.ua/control/uk/publish/article?art_id=55902&cat_id=34940.