DECISION OF ECONOMIC COUNCIL OF COMMONWEALTH OF INDEPENDENT STATES

of March 11, 2005

About the overview of trade policy of Ukraine

The economic council of the Commonwealth of Independent States solved:

1. Take into consideration the overview of trade policy of Ukraine prepared by Executive committee of the CIS on the basis of the national report provided by the Ministry of Economy and European Integration of Ukraine, and considered by the Commission on economic problems.

2. Send the specified overview to the governments of the State Parties of the CIS for informing the interested ministries and departments.

3. Charge to Executive committee of the CIS to publish in a month the specified overview and post it on the website of Executive committee of the CIS on the Internet.

 

EXECUTIVE COMMITTEE OF COMMONWEALTH OF INDEPENDENT STATES

Overview of trade policy of Ukraine

The overview of trade policy of Ukraine is constituted according to the Procedure for carrying out reviews of trade policy of the State Parties of the CIS approved by the Decision of Economic council of the Commonwealth of Independent States of March 15, 2002.

The overview is prepared by Executive committee of the CIS based on the national report provided by the Ministry of Economy and European Integration of Ukraine, and information on the matter which is available for Executive committee of the CIS.

The purpose of reviews of trade policy is achievement by the State Parties of the CIS of transparency of trade policy, assistance to observance of the rules, regulations and obligations fixed in international treaties and documents concerning forming and effective functioning of the free trade area and also regular carrying out objective assessment of the main indicators of trade policy and practice of the states of the Commonwealth, their influence on development of mutual trade.

1. MODE OF TRADE POLICY

Foreign trade of Ukraine is regulated by the modes set legislative and regulations, two - both multilateral interstate and intergovernmental agreements of Ukraine, and also obligations undertaken in case of the accession to the World Trade Organization (WTO).

 

1.1. PRINCIPLES OF FOREIGN ECONOMIC ACTIVITY

Business entities of Ukraine and foreign business entities when implementing foreign economic activity are guided by the following principles:

The principle of sovereignty of the people of Ukraine in implementation of foreign economic activity which consists in:

- exclusive right of the people of Ukraine independently and independently to perform foreign economic activity, being guided by the laws which act on the territory of Ukraine;

- need of steady accomplishment by Ukraine of all agreements and obligations of Ukraine in the field of the international economic relations.

Liberty principle of the external economic entrepreneurship which consists from:

- the rights of subjects of foreign economic activity to enter voluntarily foreign economic relations;

- the rights of subjects of foreign economic activity to perform it in any forms which are directly not prohibited by current laws of Ukraine;

- observance obligations when implementing foreign economic activity of the procedure established by the laws of Ukraine;

- exclusive right of ownership of subjects of foreign economic activity for all results of foreign economic activity received by them.

The principle of legal equality and nondiscrimination which consists from:

- equality before the law of all subjects of foreign economic activity, irrespective of patterns of ownership, including the state, when implementing foreign economic activity;

- prohibition of any, except the provided laws of Ukraine, actions of the state of which restriction of the rights and discrimination of subjects of foreign economic activity, and also foreign business entities behind patterns of ownership, location and other signs is result;

- inadmissibility of restrictive activities from any her subjects, except the cases provided by this law.

The principle of rule of law which consists from:

- regulations of foreign economic activity only laws of Ukraine;

- prohibition of application of bylaws and acts of management of local authorities which create for subjects of foreign economic activity conditions less favorable, than established by the laws of Ukraine.

The principle of protection of interests of subjects of foreign economic activity which consists that Ukraine as the state:

- provides equal protection of interests of all subjects of foreign economic activity and foreign business entities in its territory according to the laws of Ukraine;

- performs equal protection of all subjects of foreign economic activity of Ukraine outside Ukraine according to rules of international law;

- performs protection of state interests of Ukraine both in the territory, and beyond its limits only according to the laws of Ukraine, conditions of the international treaties signed by it and rules of international law.

The principle of equivalence of exchange, inadmissibility of dumping during the importing and commodity exportation.

 

1.2. TYPES OF FOREIGN ECONOMIC ACTIVITY

To types of foreign economic activity which are performed by subjects in Ukraine:

- export and commodity import, capitals and labor power;

- provision by subjects of foreign economic activity of Ukraine of services to foreign business entities, including: production, forwarding, insurance, consulting, marketing, export, intermediary, broker, agency, consignment, managerial, accounting, auditor, legal, tourist, etc. that directly and only are not prohibited by the laws of Ukraine; provision of above-mentioned services by foreign business entities to subjects of foreign economic activity of Ukraine;

- scientific, scientific and technical, research and production, production, educational and other cooperation with foreign business entities; education and training of specialists at commercial basis;

- the international financial transactions and transactions with securities in the cases provided by the laws of Ukraine;

- credit and settlement operations between subjects of foreign economic activity and foreign business entities; creation by subjects of foreign economic activity of bank, credit and insurance institutions outside Ukraine; creation by foreign business entities of the specified organizations in the territory of Ukraine in the cases provided by the laws of Ukraine;

- general business activity between subjects of foreign economic activity and foreign business entities which includes creation of the general companies of different types and forms, carrying out general economic activities and general ownership of property both in the territory of Ukraine, and beyond its limits;

- the business activity in the territory of Ukraine connected with provision of licenses, patents, know-how, trademarks and other non-material objects of property from foreign business entities;

- similar activities of subjects of foreign economic activity outside Ukraine;

- the organization and implementation of activities in the field of holding exhibitions, auctions, the biddings, conferences, symposiums, seminars and other similar actions which are performed on commercial basis, with participation of subjects of foreign economic activity; the organization and implementation of wholesale, consignment and retail trade in the territory of Ukraine for foreign currency in the cases provided by the laws of Ukraine;

- goods exchange (barter) transactions and other activities constructed on forms of mutual trade between subjects of foreign economic activity and foreign business entities;

- rent, including leasing transactions between subjects of foreign economic activity and foreign business entities;

- transactions on acquisition, sale and currency exchange at currency auctions, the currency exchanges and the interbank foreign exchange market;

- works on contractual basis of physical persons of Ukraine with foreign business entities both in the territory of Ukraine, and beyond its limits; works of foreign physical persons on contractual oplatny basis with subjects of foreign economic activity both in the territory of Ukraine, and beyond its limits;

- other types of foreign economic activity which are not prohibited directly and in exclusive form by the laws of Ukraine.

Intermediary transactions when which implementing the property right to goods does not pass to the intermediary (based on commission, agency agreements, agreements of the order and others) are performed without restrictions.

 

1.3. PURPOSES OF TRADE POLICY

The purposes of foreign trade policy of Ukraine are:

- liberalization of foreign trade, simplification of the mechanism of export and import, and also tariff and non-tariff regulation;

- protection of interests of producers, assistance to increase in export of domestic production, assistance to development of external commercial relations;

- assistance to purposeful actions for quality assurance of the imported products for consumer protection;

- assistance to prevention of illegal promotion through customs border of drugs, arms, objects of historical, ethnographic and cultural value, and also rare plants and animals.

 

1.4. REGULATORY FRAMEWORK

It is possible to carry the following documents to the basic international treaties of Ukraine signed with the State Parties of the CIS which regulate conditions and procedure for trade and economic cooperation.

Multilateral agreements:

The agreement on general terms and the mechanism of support of development of production cooperation of the companies and industries of the State Parties of the Commonwealth of Independent States of December 23, 1993;

The agreement on creation of the free trade area (CIS) of April 15, 1994 and the Protocol on modification and amendments in the Agreement on creation of the free trade area of April 15, 1994 of April 2, 1999;

Rules of determination of the country of goods' origin of November 30, 2000;

The agreement on creation of the free trade area between the State Parties of GUUAM of July 20, 2002.

Bilateral agreements:

The agreement between the Government of Ukraine and the Government of the Republic of Belarus on free trade of December 17, 1992;

The agreement between the Government of Ukraine and the Government of the Russian Federation on free trade of June 24, 1993;

The free-trade agreement between the Cabinet of Ministers of Ukraine and the Government of the Republic of Moldova of November 13, 1993;

The agreement between the Government of Ukraine and the Government of the Republic of Kazakhstan on free trade of September 17, 1994;

The agreement between the Government of Ukraine and the Government of the Republic of Armenia on free trade of October 7, 1994;

The agreement between the Government of Ukraine and the Government of Turkmenistan on free trade of November 5, 1994;

The agreement between the Government of Ukraine and the Government of the Republic of Uzbekistan on free trade of December 29, 1994;

The agreement between the Government of Ukraine and the Government of the Republic Georgia on free trade of January 9, 1995;

The agreement between the Government of Ukraine and the Government of the Russian Federation on realization of free trade regime of February 8, 1995;

The agreement between the Government of Ukraine and the Government of the Kyrgyz Republic on free trade of May 26, 1995;

The agreement between the Government of Ukraine and the Government of the Azerbaijan Republic on free trade of July 28, 1995;

The agreement between the government of Ukraine and the Government of the Republic of Moldova on free trade of August 29, 1995;

The agreement between the Cabinet of Ministers of Ukraine and the Government of the Republic of Tajikistan on free trade of July 6, 2001.

 

Internal regulatory framework

Presidential decrees of Ukraine:

of November 7, 1994 N659/94 "About Accounting of Separate Types of the External Economic Agreements (Contracts) in Ukraine";

of February 10, 1996 N124/96 "About Actions for Enhancement of Tactical Price Policy in the field of Foreign Economic Activity";

of July 7, 2003 N580 "About Additional Measures concerning Attraction of Foreign Investments in Economy of Ukraine".

Codes:

The customs code of Ukraine of July 11, 2002 N92-IV;

The economic code of Ukraine of January 16, 2003 N436;

The civil code of Ukraine of January 16 2003 N435.

Laws of Ukraine:

of April 16, 1991 N959-XII "About Foreign Economic Activity";

of May 12, 1991 N1023-XII "About Consumer Protection";

of May 17, 2001 N2406-III "About Confirmation of Conformity";

of September 10, 1991 N1540a-XII "About Protection of Foreign Investments in Ukraine";

of September 18, 1991 N1560-XII "About Investing Activities";

of February 5, 1992 N2097-XII "About Common Customs Tariff";

of June 25, 1992 N2498-XII "About Veterinary Medicine";

of June 30, 1993 N3348-XII "About Quarantine of Plants";

of February 24, 1994 N4004-XII "About Ensuring Sanitary and Epidemic Wellbeing of the Population";

of December 19, 1995 N481/95-BP "About State Regulation of Production and Trade in Alcohol Ethyl, Cognac and Fruit, Alcoholic Beverages and Tobacco Products";

of February 6, 1996 N30/96-BP "About Excise Duty Rates on Tobacco Products";

of March 19, 1996 N93/96-BP "About the Mode of Foreign Investment";

of March 23, 1996 N98/96-BP "About Patenting of Some Types of Business Activity";

of May 7, 1996 N178/96-BP "About Excise Duty Rates on Ethyl Alcohol and Alcoholic Beverages";

of May 7, 1996 N180/96-BP "About Export (Export) Duties for the Live Cattle and Raw Leather";

of May 24, 1996 N216/96-BP "About Rates of the Excise Duty and Import Duties for Some Vehicles";

of July 11, 1996 N313/96-BP "About Rates of the Excise Duty and Import Duty for Some Goods (Products)";

of April 3, 1997 N168/97-BP "About the Value Added Tax";

of April 3, 1997 N170/97-BP "About Modification of Some Legal Acts concerning Taxation by Import Customs Duty of Goods and Other Objects Which Are Imported on Customs Area of Ukraine";

of July 17, 1997 N468/97-BP "About State Regulation of Agricultural Import";

of December 23, 1997 N771/97-BP "About Quality and Safety of Foodstuff and Food Staples";

of December 22, 1998 N330-XIV "About Protection of National Producer against Dumped Imports";

of December 22, 1998 N331-XIV "About Protection of National Producer against Subsidized Import";

of December 22, 1998 N332-XIV "About Application of Special Measures concerning Import to Ukraine";

of December 23, 1998 N351-XIV "On Regulation of Goods Exchange (Barter) Transactions in the field of Foreign Economic Activity";

of May 5, 1999 N619-XIV "About Scrap Metal";

of September 10, 1999 N1033-XIV "About Establishment of Export (Export) Duty for Separate Types of Seeds of Pancake Week Cultures";

of November 4, 1999 N1212-XIV "About Single Collection Which Is Levied at Check Points through Frontier of Ukraine";

of June 1, 2000 N1776-III "About Application of Registrars of Settlement Transactions in the field of Trade, Public Catering and Services";

of March 23, 2000 N1587-III "About Distribution of Copies of Audiovisual Works, Soundtracks, Videograms, Computer Programs, Databases";

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