RESTRICTED
WORLD TRADE WT/ACC/KGZ/9
26May1997
ORGANIZATION(97-2188)
Original: English
ACCESSION OFTHE KYRGYZ REPUBLIC
Questions andReplies
totheMemorandum ontheForeign Trade Régime
(Document WT/ACC/KGZ/3)
Theadditional questions submitted byMembers andthereplies thereto provided bythe
authorities oftheKyrgyz Republic arereproduced hereunder.WT/ACC/KGZ/9
Pageii
TABLE OFCONTENTS
Page
No.Question
No.
II. ECONOMY, POLICIES AND FOREIGN TRADE
2. Economic Policies
(a) Main directions ofon-going economic policies
(i)Pricing Policies 1 1
(ii)Privatization 2 2-4
(b) Monetary andfiscal policy 3 5
(d) Foreign anddirect investment policy 3 6-7
(e) Competition policies 4 8
IV. POLICIES AFFECTING TRADE INGOODS
1. Import Regulations
(a) Trading rights 4 9-12
(b) Customs tariff 5 13
(c) Tariff quotas, tariff exemptions 6 14-15
(d) Other duties andcharges, specifying anycharges for
services rendered7 16-17
(e) Quantitative import restrictions, including prohibitions,
quotas andlicensing systems7 18
(f) Import licensing procedures 7 19-20
(h) Customs valuation 8 21
(k) Application ofinternal taxes onimports 8 22-32
(l) Rules oforigin 11 33-35
(m)(n)(o) Anti-Dumping, Countervailing Duties, Safeguards 12 36-38
2. Export Regulation
(b) Customs tariffs, feesandcharges, application oninternal
taxes toexports14 39
(d) Export licensing procedures 14 40
3. Internal Policies Affecting Foreign Trade inGoods
(b) Technical regulations andstandards 14 41-42
(d) Trade-related investment measures 15 43-44
(l) Government procurement 15 45
V. TRADE-RELATED INTELLECTUAL PROPERTY
REGIME
2. Substantive Standards ofProtection
(b) Trademarks, including service marks 16 46
(c) Geographical indications 17 47
(d) Industrial designs 18 48-49
(e) Patents 18 50-51
4. Enforcement 19 52-53WT/ACC/KGZ/9
Pageiii
Page
No.Question
No.
VI. TRADE-RELATED SERVICES REGIME
Horizontal Measures
Temporary entry andstayofnatural persons 21 54
Professional Services
Accountancy services 21 55
Engineering andarchitectural services 22 56
Legal services 23 57
Telecommunications 23 58-62
Financial Services 25 63
Recreational, Cultural andSporting Services 25 64
Auxiliary Transport Services andOther Transport Services 26 65
Foreign Investment inServices 26 66
VII. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC
RELATIONS WITH THIRD COUNTRIES
Statistics 27 67-68
2. Economic Integration, Customs Union andFreeTrade
Agreements
(b) Customs union agreements 27 69-73
(c) Freetrade agreements 29 74-77
Agreement onFreeTrade between theGovernment ofthe
Kyrgyz Republic andtheGovernment oftheRepublic of
Uzbekistan32
Protocol onWithdrawal from FreeTrade Regime tothe
Agreement between theGovernment oftheKyrgyz Republic
andtheGovernment oftheRepublic ofUzbekistan of"__"
December 199637WT/ACC/KGZ/9
Page1
II. ECONOMIC POLICIES AND FOREIGN TRADE
II.2 Economic policies
II.2(a) Main directions ofon-going economic policies
(i) Pricing Policies
Question 1.
Inresponse toquestions 1and11(WT/ACC/KGZ/5), theKyrgyz Republic hasinformed the
Working Party thatithasseven "natural monopolies" forwhich prices have notyetbeen
liberalized. Amongst them twoentities forproduction (and trading?) ofalcohol andtobacco:
KyrgyzAlco andKyrgyzTamekesi. What form doesprice control takeineachcase? Towhat
kindofother control arethese enterprises subject? Arethese monopolies created bylaw? Do
these enterprises have, formally orineffect, exclusive orspecial privileges? Dotheycontrol any
form oflicensing requirements?
Answer:
A. Kyrgyzalco
KyrgyzalcoisaStateJointStockCompanyestablishedbyaPresidentialDecreeinJanuary1996.
Themain purposes forthecreation ofKyrgyzalco areconsumer protection andrevenue generation.
Under thestructure ofKyrgyzalco, there arecurrently 14jointstock companies. Only twoofthese
companies havestateshares. Theother companies areprivate. Foreign investors maypurchase shares
inthese companies. Currently, onlyoneofthe14companies under Kyrgyzalco iswithforeign
participation.
Eachofthese companies isindependent fromtheother andhasitsownfinancial statements.
Kyrgyzalco doesnotinterfere inthemanagement andtheoperations ofthese companies anddoesnot
influence prices ofproducts produced bythese companies. TheroleofKyrgyzalco istoconclude
contractswithcompanieswishingtobeunderitsstructure,issuelicensestothesecompanies,andmonitor
thatthesecompanies comply withtheterms ofthecontract. Thecontract includes information regarding
thevolume ofimport, production andsaleofalcoholic products. Thecontracts areusually issued for
oneyearandaresubject torenewal. Licenses areissued onthebasis ofthecontract andshould not
exceed theterms ofthecontract. Kyrgyzalco itselfisnotcurrently engaged inproduction. Kyrgyzalco
mayimport andexport alcohol andalcoholic products onbehalf ofthecompanies under itsstructure
IntheKyrgyz Republic, licenses arecurrently required toimport, export, andproduce alcohol
andalcoholic products. Kyrgyzalco istheonlybodyintheKyrgyz Republic authorized toissuethese
licenses. Onlycompanies under thestructure ofKyrgyzalco areallowed toobtain licenses forimporting
andexporting ethylalcohol andforproducing alcohol andalcoholic products.1Kyrgyzalco isallowed
toperform allactivities which itlicenses.
Companies under Kyrgyzalco aremainly engaged intheproduction ofalcoholic products
including wine, liqueur, vodka, andbrandy. All14companies currently havelicenses toproduce and
export these alcoholic products.
1Theproduction ofbeerisexcepted. Other private companies areallowed toobtain licenses to
product beer.WT/ACC/KGZ/9
Page2
Anyentity (including entities outside thestructure ofKyrgyzalco) mayobtain alicense from
Kyrgyzalco toimport alcoholic products (except ethyl alcohol). There iscompetition inthetrade
andproduction ofalcoholic products between the14companies under thestructure ofKyrgyzalco.
Inaddition, thereiscompetition inthetradeofalcoholic products between private entities andcompanies
under thestructure ofKyrgyzalco. Thedomestic market share ofcompanies under thestructure of
Kyrgyzalco inthesaleofalcoholic products isapproximately 60percent.
Wholesale prices ofalcoholic products areestablished separately byeachoftheenterprises
under Kyrgyzalco. Enterprises under Kyrgyzalco must declare theirprices totheAnti-Monopoly
Department under theMinistry ofFinance andaresubject toprofitability control bytheAnti-Monopoly
Department. Profit maynotexceed 20percent.
Finally, there arenocurrent plans toeliminate Kyrgyzalco andtakeaway itsauthority to
license thetrade andproduction ofalcohol andalcoholic products
B. Kyrgyztamekesi
KyrgyztamekesiisaStateJointStockCompanyestablishedbyPresidentialDecreeinMay1996.
Therearesevencompaniesunderitsstructure(sixarejointstockcompaniesandoneisastateenterprise).
Thestateshare inthese companies isasfollows: 37percent; 40percent; 65percent; 66percent;
70percent;71percent;and100percent. Foreign participation ispermitted. Currently, noforeign
investors haveshares inanyofthese seven companies. Eachofthese companies isindependent from
theother andhasitsownfinancial statements. Thedirectors ofeachofthese seven companies are
members oftheBoard ofDirectors ofKyrgyztamekesi.
Themain purpose ofestablishing Kyrgyztamekesi are(1)stateregulations oftobacco and
tobacco products and(2)revenue generation. These seven companies areengaged intobacco
fermentation, production oftobacco products, saleoffermented tobacco, export offermented tobacco,
andimport ofauxiliary materials (e.g.filter) forproduction oftobacco products (foritsownuse).
Kyrgyztamekesi hastheexclusive authority toissue licenses for(1)production oftobacco products
andfermentation oftobacco leaves and(2)import/export license forfermented tobacco. Please note,
however, thatthedraftimplementing resolution oftheLawonLicensing re-assigns suchlicensing
authority totheMinistry ofHealth.
ThedomesticmarketshareofKyrgyztamekesiisapproximately16percentfortobaccoproducts.
Licenses arenotrequired fortheimport/export oftobacco products. Anyperson mayobtain alicense
toengage intheproduction oftobacco products andfermented tobacco andimport/export offermented
tobacco. Kyrgyztamekesi doesnothaveanyexclusive rights toexport fermented tobacco.
Kyrgyztamekesi mustdeclare itsprices totheAnti-Monopoly Department under theMinistry
ofFinance andissubject toprofitability control bytheAnti-Monopoly Department. Itsprofit may
notexceed 20percent.
(ii) Privatization
Question 2.
Howandwhen willtheconstitutional prohibition ontheprivate ownership oflandbeeliminated?WT/ACC/KGZ/9
Page3
Answer:
There isnotimetable toamend theconstitution inorder toeliminate theprohibition on
theprivate ownership ofland. Thisissue isstillbeing addressed bythegovernment working group
established pursuant toCabinet ofMinisters Instruction No.105-p of22April 1996.
Question 3.
Please could theKyrgyz Republic provide theWorking Party withthenewdraft ofthelaw"On
Property Rights inLand" foritsconsideration.
Answer:
Thecurrent draftlaw"OnProperty Rights inLand" isnotfinalised. Acopywillbeprovided
assoonasanewdraftversion iscompleted.
Question 4.
Please provide information onthePrivatisation Programme for1998-1999, which theKyrgyz
Republic stated would bedeveloped this year [1997] initsresponse toquestion 6
(WT/ACC/KGZ/5/Add.2).
Answer:
ThePrivatisation Programme for1998-1999 iscurrently being developed. Itisexpected that
theGovernment complete itswork toward theendof1997. Atthattime, information willbeprovided.
II.2(b) Monetary andfiscal policy
Question 5.
Wewould begrateful forareply toquestion 4(WT/ACC/KGZ/5) onwhether theKyrgyz Republic
maintains non-exchange restrictions oncurrent account orcapital transactions.
Answer:
AccordingtotheobligationsoftheKyrgyzRepublicunderArticleVIIIoftheIMFagreement,
theKyrgyz Republic adheres toapolicy ofnotintroducing restrictions onmaking payments andtransfers
offinancial assets oncurrent account orcapital transactions.
II.2(d) Foreign anddirect investment policy
Question 6.
Thereply toquestion 5(WT/ACC/KGZ/5) covers thenational treatment principle ingeneral.
Arethere anyrestrictions tothenational treatment principle forforeign direct investment
specifically?
Answer:
Restrictions tothenational treatment aredescribed inSection VI.3.g page 54of
WT/ACC/KGZ/3.WT/ACC/KGZ/9
Page4
Question 7.
According totheresponse toquestion 7(WT/ACC/KGZ/5), foreign investors aresubject tothe
same procedures applicable toKyrgyz citizens andlegalentities incases ofexpropriation. Please
describe these procedures.
Answer:
Decisions onnationalisation aremade bytheJogorku Kenesh oftheKyrgyz Republic
("Parliament"). Alawisissued regarding thenationalisation ofaspecific property. TheCabinet
ofMinisters paysacompensation inaccordance withtherealcostofanationalised property.
Foreign investors aresubject tothesameprocedures applicable toKyrgyz citizens andlegal
entities. However, procedures formaking decisions onnationalisation anddetermining theamount
ofcompensation havenotyetbeenelaborated.
II.2(e) Competition policies
Question 8.
What istheoutcome ofthereview ofthenotification of"natural" monopolies asstate trading
entities, andtheother three "permitted monopolies" (WT/ACC/KGZ/5/Add.2 question 12)?
Answer:
Theoutcome ofthereview ofthenotification on"natural" monopolies willbeprovided later
on.
IV. POLICIES AFFECTING TRADE INGOODS
Schedule ofconcessions
IV.1 Import regulations
IV.1(a) Trading rights
Question 9.
InAnnex 6totheForeign Trade Regime Memorandum, theKyrgyz Republic states thatResolution
No.373establishes alistof29enterprises thataregiven theexclusive right tocollect, purchase,
store andexport scrap metals. Thislistis"temporary" pending enactment ofafurther lawby
Parliament, which isintheParliament 'swork planfor1997. Please:
(a) Provide anupdate ontheprogress ofthedraft law;
(b) reconsider onthebasis ofthatprogress whether anotification ofthese enterprises should
bemade under theprovisions ofGATT XVII;
(c) confirm thatthese 29enterprises arenotthesame asthose 30"temporary monopolies"
towhich reference ismade intheanswer toWT/ACC/KGZ/Add.2 question 11.WT/ACC/KGZ/9
Page5
Answer:
TheKyrgyz Republic hasadopted on3March 1997aLawonLicensing. Thislawstates that
theactivity ofcollecting, purchasing, processing, andselling industrial scrap andwaste offerrous and
non-ferrous metals iscarried outonthebasisofalicense granted byastateagency (tobedetermined).
Inlightofthisnewlaw,theKyrgyz Republic isconsidering therevocation ofGovernment Resolution
No.373of25August 1997 which established thelistof29enterprises. Therefore, notification of
theseenterprises onthedateoftheKyrgyz Republic 'saccession totheWTO maynolonger berequired.
Oftheoriginal 29companies, only24hadpermanent licenses. Theother fivecompanies
hadatemporary license which haveexpired. Currently, there areonly24companies.
Onlyoneofthe24companies isonthelistofthe"temporary monopolies". Currently, there
are32companies listed as"temporary monopolies".
Question 10.
Please confirm thatthese same 30or31"temporary monopolies" donothave exclusive trading
rights.
Answer:
Yes. Enterprises included inthelistof"temporary monopolies" donothaveexclusive
trading rights, except oneenterprise asmentioned intheresponse toquestion 9above.
Question 11.
Please giveanupdate onthereview oftheoperations, legal status andrights ofthe"natural
monopolies" (referred tointheanswer toWT/ACC/KGZ/5 question 11)withaviewtonotifying
under theprovisions ofGATT XVII those which fallwithin thepurview ofthatArticle.
Answer:
Please seetheresponse toquestion 8above.
Question 12.
Weunderstand thatastate alcohol monopoly hasbeen reintroduced intheKyrgyz Republic.
Wewould begrateful fordetails, including thereason foritsintroduction, itsscope ofactivities
andduration.
Answer:
Please seetheresponse toquestion 1above.
IV.1(b) Customs tariff
Question 13.
Please provide theWorking Party withlegislation andnormative actsconcerning theimposition
ofseasonal duties.WT/ACC/KGZ/9
Page6
Answer:
There isonlyonereference toseasonal duties intheCustoms Tariff Lawof15December
1992. Article 17states thefollowing:
"TheCabinet ofMinisters oftheKyrgyz Republic mayissueRulings which establish seasonal
customs duties forcertain types ofgoods andtheireffective terms".
Pleasenotethatnoregulationshavebeenenactedtoimplementthisprovision.TheGovernment
oftheKyrgyz Republic hassofarnotimposed seasonal duties.
IV.1(c) Tariff quotas, tariff exemptions
Question 14.
Technical equipment, rawmaterials, materials, reagents, components, replacements, spare parts,
semi-manufacturers andother articles areexempt from customs duties ifimported bydomestic
enterprises forfinal products.
(a) Arethese exemptions available toforeign enterprises registered aslegal entities to
undertake production intheKyrgyz Republic?
Answer:
Yes.
(b) What number ofbusinesses have, inarecent representative period, enjoyed thebenefits
ofsuchdutyexemptions?
Answer:
Itisestimated that,since 30March 1994, 436businesses haveenjoyed thebenefits ofsuch
dutyexemptions.
Question 15.
Intheresponse toWT/ACC/KGZ/5 question 12,itisnoted thattheKyrgyz Republic doesnot
intend tointroduce import quotas inthe"near" further. Could youplease explain theuseof
thequalifier "near"? Wewould notethatitwould complicate theaccession process iftheKyrgyz
Republic were tointroduce anysuch restrictions incompatible with WTO norms during the
accession negotiations.
Answer:
TheKyrgyz Republic mayinthefuture introduce import quotas asanemergency measure
inaccordance withArticle XIXofGATT andforbalance ofpayment purposes inconformity with
theWTO. TheKyrgyz Republic doesnotforesee, however, balance ofpayment problems inthenear
future (next 2years).WT/ACC/KGZ/9
Page7
IV.1(d) Other duties andcharges, specifying anycharges forservices rendered
Question 16.
Please provide theWorking Party withabreakdown ofthecosts ofservices rendered forcustoms
clearance.
Answer:
Such information willbeprovided assoonastheKyrgyz Republic completes itswork on
bringing itscustoms clearance feeintoconformity withArticle VIII.
Theproduction ofbeerisexcepted. Other private companies areallowed toobtain licenses
toproduce beer.
Question 17.
Weurge theKyrgyz Republic toexpedite itswork onbringing thecustoms feestructure into
conformity withArticle VIII. Weattach importance totheability oftheKyrgyz Republic tobe
inconformity withArticle VIIIfrom thedateofaccession.
Answer:
Thecustoms feestructure oftheKyrgyz Republic willconform toArticle VIIIfromthedate
ofaccession.
IV.1(e) Quantitative import restrictions, including prohibitions, quotas andlicensing systems
Question 18.
Pending theentry intoforce ofResolution No.56which provides forlicensing requirements on
textile goods, wearing apparel, silicon carbide, ammonium nitrate andrawaluminium, whatexport
controls areinplace forthese items?
Answer:
There arenoexport controls inplace fortextile goods, wearing apparel, silicon carbide, ammonium
nitrate andrawaluminium. Exception islicense requirement fortextile exports totheEuropean Union.
IV.1(f) Import licensing procedures
Question 19.
TheKyrgyz Republic hasconfirmed thatitwillrevise itsimport licensing system toensure
conformity withtheWTO Agreement onImport Licensing Procedures. Please outline what steps
arebeing taken toachieve this. Weattach importance totheability oftheKyrgyz Republic to
beinconformity withtheAgreement from thedateofaccession.WT/ACC/KGZ/9
Page8
Answer:
TheGovernment oftheKyrgyz Republic iscurrently intheprocess ofdrafting legislation
toestablish newimport licensing procedures inconformity withtheWTO. Adraftwillbeprovided,
oncecompleted, totheWTO Secretariat.
Question 20.
Please confirm whether ornotthecharge ofSom750(US$65) foranimport license iscompatible
withtheGATT Article VIII(a)requirement thatsuchacharge is"limited totheapproximate
costofservice rendered" (i.e.thework involved).
Answer:
TheKyrgyz Republic cannotconfirm thatthecharge ofSom750foranimport license is
compatible withtheGATT Article VIII. Thisfee,however, willbeinconformity withArticle VIII,
from thedateofaccession.
IV.1(h) Customs valuation
Question 21.
Wewelcome thecommitment made bytheKyrgyz Republic tobeinconformity withtheWTO
Customs Valuation Agreement from thedateofaccession. Wewould begrateful inthisrespect
iftheKyrgyz Republic could keep theWorking Party informed ofprogress ontheadoption of
thedraft Customs Code.
Answer:
Thedraft Customs Code isstillbeing reviewed bytheParliament. However, additional
amendments toconform totheWTO Customs Valuation Agreement arenowbeing introduced.
IV.1(k) Application ofinternal taxes onimports
VAT
Question 22.
Application oftheMFN principle tointernal taxation remains anissue ofmajor concern. What
progress hasbeenmade indiscussions ofthetransition intheInter-State Council andIntegration
Committee tobring theVAT system intoconformity withaccepted world practice?
Answer:
TheKyrgyz Republic supports theprinciples ofbringing inlinewithinternational practices
itssystem ofcollecting VAT. TheKyrgyz Republic iscurrently intheprocess ofnegotiating ona
bilateral basis withvarious CIScountries toensure thatVAT isapplied atimports rather thanatthe
point ofproduction. Abilateral agreement hasbeenreached withKazakstan. Currently, Kazakstan
istreated asnon-CIS countries withrespect totheapplication ofVAT. Inaddition, asimilar agreement
hasbeeninitialled withUkraine andthefirstround ofnegotiations hasbeenconcluded withUzbekistan.
Thisissueisalsostillbeing addressed bytheInter-State Council andIntegration Committee.WT/ACC/KGZ/9
Page9
Question 23.
CanyouconfirmthatVATexemptionsforcapitalgoodsnotforresaleareavailableonlytodomestic
enterprises?
Answer:
VAT exemptions forcapital goods notforresale areavailable todomestic andforeign
enterprises registered intheKyrgyz Republic.
Question 24.
Iftheyareavailable alsotoforeign companies, what istheprocedure (notthecriteria) forapplying
fortheexemption?
Answer:
Theprocedure forapplying fortheexemption isthesamefordomestic andforeign enterprises
registered asVAT taxpayers intheKyrgyz Republic. Anapplication should befiledwiththeState
Customs Inspectorate indicating thatimported goods arecapital goods andnotforresale.
Question 25.
Theanswer toWT/ACC/KGZ/5/Add.2 question 43suggests thatintheKyrgyz Republic, VAT
islevied atthepoint ofsaleaswellasatthepoint ofproduction. Wehadunderstood, however,
thatVAT isonlylevied atthepoint ofproduction -leading tothedifferent treatment ofimports
from CISandnon-CIS countries. Wewould begrateful forclarification ofthesituation.
Answer:
Withrespect togoods imported fromnon-CIS countries andKazakstan, theVAT isassessed
atthetimeofimportation. Withrespect toCIScountries (other thanKazakstan), theVATisnotimposed
atthetimeofimportation andiscollected when goods areactually soldwithin theKyrgyz Republic.
Inbothcases, thebusiness entity which carries outdeliveries ofgoods hastherighttoVAT offset.
Question 26.
Please confirm whether ornotVAT levied onimports form CIScountries islevied oncustoms
value ofthegoods only, orcustoms value pluscustoms duties andother feesdueon
importation.
Answer:
Asof14January 1997, theVAT isassessed onthecustoms value oftheimported goods from
allcountries including CIS.WT/ACC/KGZ/9
Page10
Excise Taxes
Question 27.
Wewelcome theKyrgyz Republic 'srecognition thathercurrent excise taxsystem isincompatible
withGATTArticleIIIandherplanstoeliminatethisdiscrimination(WT/ACC/KGZ/5questions27
and28). Wewould begrateful ifaprogress report could beprovided onthenecessary
legislation toenact these changes.
Answer:
TheKyrgyz Republic plans toestablish, upon accession totheWTO, oneequal excise tax
regime forimported anddomestically produced goods. Appropriate legislation willbeenacted atthat
time.
Question 28.
Questions28and30inWT/ACC/KGZ/5;question47ofWT/ACC/KGZ/5/Add.2:Couldweassume
thatexcise taxrates willbeharmonised by1January 1998, despite theproposed regime mentioned
inquestion 30,whether domestic ratestilldiffer from rates forimported products?
Answer:
Please seetheresponse toquestion 27.
Question 29.
CantheKyrgyz Republic confirm thatitdoesnotintend tolevyinternal taxes, except forVAT
andexcise tax,onimported goods infuture?
Answer:
TheKyrgyz Republic confirms thatitdoesnotintend tolevyinternal taxes, except forVAT
andexcise tax,onimported goods infuture.
Question 30.
Weunderstand thesystem inoperation inmany CIScountries isthatexcise taxes arelevied at
source, notinthecountry ofdestination. How doestheKyrgyz Republic copewiththefactthat
different rates apply indifferent countries? Isthedifference indueexcise duties paidatthe
border?
Answer:
Please seetheresponse toquestion 48ofWT/ACC/KGZ/5/Add.2.
Unlike VAT, excise taxes areapplied totheconcerned imports fromallcountries (including
CIScountries) inthesame fashion (destination andnotsource). Thedifference inexcise duties for
goods imported from CIScountries isnotpaidattheborder.WT/ACC/KGZ/9
Page11
Question 31.
Ifso,when calculating thedifference between excise rates paidinother CIScountries andthose
payable intheKyrgyz Republic, what (Kyrgyz) rateofexcise dutyisusedasabasis forcalculation
ontheproducts listed under question 47(WT/ACC/KGZ/6/Add.2) for(a)products from Russia,
Belarus andtheKyrgyz Republic and(b)products from other CIScountries?
Answer:
Please seetheresponse toquestion 30.
Question 32.
What methodology isusedtocalculate excise ratesfor(a)domestic, (b)CISand(c)other imported
products. What currency canbeusedineachcase?
Answer:
Cabinet ofMinisters Resolution No.71of7February 1997 establishes themethodology to
beusedforcalculating excise taxes. Thismethodology isthesame forgoods produced intheKyrgyz
Republic andimported from other countries including CIScountries.
Incasewhere theexcise taxrateisestablished inproportion ofthewholesale priceofgoods:
H= C+A:100%;
where
H=theamount ofexcise tax
C=thewholesale price ofgoods (ortheircustoms value atthepoint ofimport)
A=therateofexcise taxinpercent.
Incasewhere theexcise taxrateisestablished inUS$tothephysical volume ofgoods:
H=OxTxK
where
H=theamount ofexcise tax
O=thephysical volume ofmanufactured orimported goods (kilogram, litre, units, tons)
T=therateofexcise taxinUS$perunit
K=theUS$exchange ratetotheKyrgyz Som.
TheSomistheonlycurrency thatmaybeusedforpayment ofexcise taxes forbothimports
anddomestic products. Conversion intoSoms isbased ontheofficial exchange rateoftheNational
Bank oftheKyrgyz Republic.
IV.1(l) Rules oforigin
Question 33.
Does theKyrgyz Republic intend tointroduce acountry oforigin marking requirement?
Answer:
TheKyrgyz Republic doesnothaveanycurrent plans tointroduce acountry oforigin marking
requirement.WT/ACC/KGZ/9
Page12
Question 34.
HastheKyrgyzRepublicmadeprogressondevelopingregulationsontheimplementationofcountry
oforigin methods? Ifnot,what steps areplanned andtowhat timetable?
Answer:
Asoftoday, noprogress hasbeenmade toward developing regulations ontheimplementation
ofcountry oforigin methods. Interim regulations areexpected tobeinplace bytheendof1997.
TheKyrgyz Republic plans toadopt theHarmonised Rules ofOrigin oncecompleted bytheWorld
Customs Organisation (WCO).
Question 35.
Isproof needed forpreferential trade only? What constitutes proof?
Answer:
According totheexisting Customs Tariff LawandArticle 180oftheproposed Customs Code,
theproof oforigin isneeded forthefollowing: preferential trade; goods subject toimport quotas (none
ineffect today); where required byinternational treaties; ifrequired bylegislation protecting thenatural
environment, public health, consumer protection, public order, national security andothervitalinterests;
noinformation regarding origin inentry documents; andwhere fraud issuspected.
Aproof oforigin consists ofacertificate oforigin thatisnotarised byanauthorized body in
thecountry oforigin.
IV.1(m)(n)(o) Anti-Dumping, Countervailing Duties, Safeguards
Question 36.
Areading oftheEnglish translation ofboththeCustoms Tariff Lawinforce andtheproposed
one(Attachment Blisted inWT/ACC/KGZ/5/Add.1) confirms theview, already expressed by
theEuropean Communities, thattheRepublic 'santi-dumping, countervailing andsafeguard
legislation, either inforce orindraft form, departs from WTO rules inseveral respects.
Inthelightoftheforegoing, theKyrgyz Republic iskindly requested toconfirm thatitwillamend
itstrade defence legislation soastohaveaWTO-consistent legislative framework inforce upon
itsaccession totheWTO. Thiswould entail inparticular alignment ofthesubstantive standards
andprocedures ofanti-dumping, countervailing andsafeguards measures, andprovision forthe
respect oftheresults ofmultilateral dispute settlement intheapplication of"specialised customs
duties" asretaliatory measures. Inparticular, ontheproposed Customs Tariffs Lawwewould
begrateful forclarification onthefollowing points:
Article II Howwillinvestigations beconducted? What "objective andquantifiable" relevant
factors willbeevaluated toestablish causality andserious injury? (thisreads across toArticle 4
oftheWTO Safeguards Agreement). Whowillberegarded asa"domestic industry"? Issafeguard
action tobelimited tosuchtariff-based measures, ormight quantitative restrictions beapplied
instead (ifso,under what authority andbasis)? Willsafeguard measures beapplied ergaomnes,
asrequired byWTO rules, and(ifquantitative) with orwithout anydifferentiation ("quota
modulation").WT/ACC/KGZ/9
Page13
Article 8(first part) while thewording ofthisseems toattempt tocover safeguards action, it
would bepreferable forthetexttomirror much more closely theexact language ofArticle 21
oftheWTO Safeguards Agreement.
Article 8(second part) Isthisprovisionmeanttobeconfinedtocompensatoryactionagainst
another country 'ssafeguard measures against theKyrgyz Republic orisitdesigned tocover
anyactions? Also, weassume thatby"union" theKyrgyz Republic means "customs union".
Ifso,thisshould bestated explicitly.
Answer:
TheKyrgyz Republic nolonger plans toadopt anewCustoms Tariff Law. Theexisting
Customs Tariff Lawwillbecome invalid uponenactment ofthenewCustoms Code. ThenewCustoms
Code willsimply havereferences toother legislation which willaddress dumping, countervailing, and
safeguard measures. Dumping, countervailing, andsafeguard measures willbegoverned bynewlaws
currently being drafted inconformity withrespective WTO agreements.
Draft lawsondumping, countervailing, andsafeguard measures willbemade available tothe
Working Party during summer 1997 forcomments.
Question 37.
Could theKyrgyz Republic please statewhether itwillmaintain subsidies prohibited byArticle 3
oftheSubsidies andCountervailing Measures Agreement upon itsaccession totheWTO and
whether itwillrelyupon Article 29ofthesame Agreement tojustify suchsubsidies.
Answer:
Theonlysubsidies prohibited byArticle 3oftheSubsidies andCountervailing Measures
Agreement aretaxincentives asprovided intheforeign investment lawof1991. Anewforeign
investmentlawisintheprocessofbeingadopted.TheParliamentiscurrentlyconsideringtheelimination
oftaxincentives based onexport performance.
Question 38.
Initsreply WT/ACC/KGZ/5/Add.2 question 57,theKyrgyz Republic notes thattheproposed
Law"may include specific provisions addressing unfair trade practices byforeign firm". We
would begrateful ifthiscould beelaborated; andinparticular weseekconfirmation thatthis
willnotleadtotreatment offoreign firms lessfavourable thanthataccorded toKyrgyz firms.
Answer:
Currently,theKyrgyzRepublicispreparingthreedraftlawstoaddressanti-dumping,safeguard,
andcountervailing measures. These lawswillbeinfullconformity withrespective WTO agreements.
Copies ofthese draftlawswillbeprovided totheWorking Party during summer 1997.WT/ACC/KGZ/9
Page14
IV.2 Export Regulation
IV.2(b) Customs tariffs, feesandcharges, application ofinternal taxes toexports
Question 39.
Please explain therationales fortheintroduction ofexport duties. Isthisatemporary measures?
Weurge theKyrgyz Republic toreconsider theimposition ofsuchduties astheyrepresent an
obstacle totheGovernment 'sstated goaloftrade liberalisation.
Answer:
Thepurposeofintroducingexportdutiesistoestablishequalaccesstorawmaterialsfordomestic
producers. Thisisatemporary measure.
IV.2(d) Export licensing procedures
Question 40.
Hasalawonlicensing formetals been passed toreplace Resolution 373? Ifso,please provide
theWorking Party withacopy ofthelaw.
Arethere anychanges tothetemporary listof29enterprises subject toexport licensing? Isthis
listexclusive?
When doestheKyrgyz Republic intend toabolish thissystem?
Answer:
Seetheresponse toquestion 9above.
Currently, theKyrgyz Republic doesnothaveanyplans toabolish thissystem.
IV.3 Internal Policies Affecting Trade inGoods
IV.3(b) Technical regulations andstandards
Question 41.
TheKyrgyz Republic hasnoted initsresponse toWT/ACC/KGZ/5 question 47thatitenvisages
difficulties inmeeting therequirements oftheTechnical Barriers toTrade Agreement. What
isbeing done byKyrgyzstan toalleviate these foreseen difficulties?
Answer:
TheKyrgyz Republic hasinitiated work toward resolving difficulties mentioned in
WT/ACC/KGZ/5 question 47. Aprogress report willbeprovided atalaterstage.WT/ACC/KGZ/9
Page15
Question 42.
Inresponse toquestion 28inWT/ACC/KGZ/5/Add.2 theKyrgyz Republic mentions that
agricultural andfood commodities arenotsubject tolicensing. However, some agricultural
products seem tobesubject tosafety certification. What isthenature ofthese safety certificates?
Answer:
Asstated intheWT/ACC/KGZ/3 (PartIV.3.b; PartIV.3.c; andAnnex 5),anumber ofgoods
requires certification prior tosale,without regard totheorigin oftheconcerned good. Kyrgyz and
Non-Kyrgyz goods aresubject tothesame requirements. Thepurpose ofsuchcertificates istoensure
conformity tosafety standards. WT/ACC/KGZ/3 (Part IV.3.b; PartIV.3.c; andAnnex 5)provides
extensive details regarding suchcertificates.
IV.3(d) Trade-related investment measures
Question 43.
Onprofits taxexemption, could youplease confirm thatthere isaprofits taxreduction of
25percentifatleast 50percentofproduction isderived from imported rawmaterials or
components (notdomestic; ouritalics)?
Answer:
Yes.
Question 44.
The25percentreduction intheotherwise applicable profits taxif5percentormore oftheentity 's
products andservices areexported isinconsistent withtheSubsidies andCountervailing Measures
Agreement. Itisalsoinconsistent withTRIMS. What isthetimetable foritselimination?
Answer:
Anewforeign investment lawisintheprocess ofbeing adopted. TheParliament iscurrently
considering theelimination oftaxincentives based onexport performance.
IV.3(l) Government procurement
Question 45.
Wewelcome theinitiative oftheKyrgyz Republic tojointheGovernment Procurement Agreement
(WT/ACC/KGZ/5). However, wecould learn from theanswers received thatthenewlawwould
allow fordomestic preferences, either bylimiting procurement procedures tonational bidders,
orbygiving preferential margins todomestic goods orservice providers. Such aprovision would
create atrade barrier incontradiction with theKyrgyz statement onfuture accession tothe
Government Procurement Agreement.
When doestheKyrgyz Republic plantojointheGovernment Procurement Agreement ?
When isthedraft lawisexpected tobeinforce?WT/ACC/KGZ/9
Page16
Answer:
Thenewlawongovernment procurement isexpected tobeinforce on1June1997. Please
notethatthelastversion ofthedraftlaw(1)doesnotlimitprocurement procedures tonational bidders
and(2)doesnotgivepreferential margins todomestic goods orservice providers. Acopyofthis
newlawwillbeprovided before thenextmeeting oftheworking party.
TheKyrgyz Republic plans toinitiate theprocess ofjoining theGovernment Procurement
Agreement twoyears aftertheestablishment oftheKyrgyz Government Procurement Agency (KGPA).
KGPA wasestablished inJanuary 1997.
V. TRADE-RELATED INTELLECTUAL PROPERTY REGIME
V.2 Substantive Standards ofProtection
V.2.(b) Trademarks, including service marks
Question 46.
Initsanswers ontheprotection ofwell-known trademarks theKyrgyz Government states that
theprotection isinlinewiththeParis Convention. However, theTRIPs Agreement initsArticle
16.2and3extends thisprotection toservice marks andto"goods orservices which arenotsimilar
tothose inrespect ofwhich atrademark isregistered, provided thattheuseofthattrademark
inrelation tothose goods orservices would indicate aconnection between those goods orservices
[...]". Does suchanextensive protection already exist inKyrgyz legislation? Ifnot,doesthe
proposed lawonTrademarks, Service Marks andAppellations ofOrigin contain suchprovisions?
Ifnot,doestheKyrgyz Government intend tointroduce suchaprotection? Please explain.
Answer:
TheTemporary Regulation onIndustrial Property oftheKyrgyz Republic doesnotdirectly
provide forprotection ofwell-known trademarks andservice marks.
However, incompliance with point 3ofparagraph 4.4.6 oftheTemporary Regulation
designations identical orconfusingly similar totrademarks ofother entities orpersons which are
protected without registration byvirtue ofinternational agreements oftheKyrgyz Republic maynot
beregistered astrademarks.
Practical interpretation ofthatRegulation willmeettheprovisions ofArticles 16(2)and(3)
oftheTRIPS Agreement andArticle 6bisoftheParis Convention.
Paragraph 3ofArticle 5ofthedraftLawoftheKyrgyz Republic "OnTrademarks, Service
Marks andAppellations ofOrigin" provides thatnodesignations mayberegistered astrademarks which
arethesame orconfusingly similar totrademarks which arewell-known intheKyrgyz Republic.
Paragraph 1.2oftheTemporary Regulation andArticle 3ofthedraftLawprovide thatthe
terms "trademarks andservice marks" areunderstood tobeincluded throughout thetextofthelaw
within theterm"trademarks".WT/ACC/KGZ/9
Page17
V.2(c) Geographical Indications
Question 47.
TheKyrgyzGovernmentdescribestheprotectionofgeographicalindicationsinthedrafttrademark
lawasmainly based onconfusion oftheconsumer. Does thedraft law(oranyother bill)Ialso
foresee protection against unfair competition within themeaning ofArticle 10bisoftheParis
Convention? Furthermore, doesthedraft contain provisions fortheprotection ofgeographical
indications forwines andspirits even where thetrueorigin isindicated orthegeographical
indications areusedintranslation oraccompanied bytheexpression suchas"kind", "type", "style",
orthelike? Finally, towhat extent does thedraft foresee theprotection ofhomonymous
geographical indications forwines andspirits? Please explain.
Answer:
Yes. ThedraftLaw"OnTrademarks, Service Marks andAppellations ofOrigin" provides
protection against unfair competition withrespect togeographical indications within themeaning of
Article 10bisoftheParisConvention. Protection against unfair competition isprovided inthecontexts
ofregistration andenforcement.
ThedraftTrademark Lawprovides thatageographical indication mayonlyberegistered by
entities orpersons whose products possess special characteristics which areexclusively ormainly
determined bythenatural conditions orhuman factors characteristic ofthatgeographical place orby
natural conditions andhuman factors simultaneously. Draft Trademark Law, Articles 28and29.
TheLawalsoprovides thatpersons notholding aregistration certificate areforbidden tousethe
registered geographical indication, andareforbidden touseanysimilar geographical indication for
similar goods which maymislead consumers withrespect totheplace oforigin orspecial properties
oftheproduct. Draft LawoftheKyrgyz Republic "OnTrademarks, Service Marks andAppellations
ofOrigin", Article 37.
Toensure thatthese protections aremeaningful, thedraftTrademark Lawprovides forthe
followingremediesforillegaluseofregisteredgeographicalindicationsordesignationswhicharesimilar
tothem: cessation ofillegal use;indemnification; deposit intothelocalbudget oftheamount ofillegal
profits which exceed indemnified losses; publication ofthecourt'sdecision forthepurpose of
rehabilitating therightholder 'sbusiness reputation; removal oftheunauthorized geographical indication
orsimilar designation fromthegoodoritspackaging; ordestruction oftheunauthorized geographical
indication orconfusingly similar designation. Draft LawoftheKyrgyz Republic "OnTrademarks,
Service Marks andAppellations ofOrigin", Article 42.
Inaddition totheforegoing protections under thedraft Trademark Law, theexisting Law
"OnLimitation ofMonopolistic Activities andtheDevelopment andProtection ofCompetition" also
provides forprotections against unfair competition withrespect togeographical indications within the
meaning ofArticle 10bisoftheParisConvention. TheAnti-Monopoly Lawprohibits thedistribution
offalseormisleading information (including provision ofcorrect information inafalselight) which
maydamage thebusiness reputation ofanother business entity orperson. LawoftheKyrgyz Republic
"OnLimitation ofMonopolistic Activities andtheDevelopment andProtection ofCompetition", Article
5.TheAnti-monopoly Lawalsoprohibits misleading consumers concerning thenature, method and
place ofmanufacturing ofingredients, dueuseorquality ofgoods (Law oftheKyrgyz Republic "On
Limitation ofMonopolistic Activities andtheDevelopment andProtection ofCompetition", Article
5).Finally, thesameLawprohibits theunauthorized useofatrademark, firmname, orillegal branding
(Law oftheKyrgyz Republic "OnLimitation ofMonopolistic Activities andtheDevelopment and
Protection ofCompetition", Article 5).Remedies forviolation oftheseprohibitions include thebreakingWT/ACC/KGZ/9
Page18
upoftheoffending business entity, disgorgement ofillegal profits, indemnification, andfines(Law
oftheKyrgyz Republic "OnLimitation ofMonopolistic Activities andtheDevelopment andProtection
ofCompetition", Article 19).
ThedraftLaw"OnTrademarks, Service Marks andAppellations ofOrigin" doesnotcontain
provisions fortheprotection ofappellations oforigin forindividual kinds ofgoods, inparticular for
wines andspirits, butnevertheless, theirlegalprotection isprovided according tothegeneral principles
oflegalprotection ofappellations oforigin.
V.2(d) Industrial Designs
Question 48.
Intheanswer tothequestion ontheprotection oftextile designs reference isonlymade tothe
protection ofindustrial designs. Istheunderstanding correct thattextile designs areprotected
asindustrial designs?
Answer:
Yes.
Question 49.
Inthesame answer theKyrgyz Government refers tothenotion ofapreliminary design. Could
theKyrgyz Government explain therelation ofsuchadesign totheregular industrial design?
Answer:
Thequestion isnotclear, probably because there wasatranslation ortypographical error in
theprevious response given byKyrgyzpatent. Kyrgyzpatent 'sprevious response referred to
"preliminary patent foranindustrial design", not"preliminary design".
V.2(e) Patents
Question 50.
What doesKyrgyz legislation consider tobeavalid reason fornon-use orinsufficient useofa
patent? Please explain.
Answer:
Neither theexisting Temporary Regulation northedraftLawdefines validreasons fornon-use
orinsufficient useofapatent. Thisquestion islefttothecourt'sdiscretion, andistobedecided on
acase-by-case basis.
Question 51.
What criteria areusedtodecide thescope andduration ofacompulsory license?WT/ACC/KGZ/9
Page19
Answer:
Incompliance withtheTemporary Regulation onIndustrial Property oftheKyrgyz Republic
andthedraftLaw,thisquestion islefttothecourt'sdiscretion. TheTemporary Regulation onIndustrial
Property oftheKyrgyz Republic provides thatthecourt shallgrant thelicense "with certain limits
ofuse,amount, terms andorder ofpayments". Temporary Regulation, Article 6.3.ThedraftLaw
"OnPatents" provides thatthecourt shallgrant thelicense "specifying thescope ofuse,theamount,
timelimits andprocedures ofpayment". Draft Patent Law, Article 13.
V.4 Enforcement
Question 52.
From thesubmitted documentation ithastobeconcluded thatneither thecurrent northeproposed
newcriminalcodecontainanyspecificmeasuresagainstcounterfeittrademarksorpiratedcopyright
goods. Isittheintention oftheKyrgyz Government tointroduce suchmeasures? Ifso,what
would bethetime-frame?
Answer:
Thegovernment respectfully disagrees thatsuchaconclusion istobedrawn fromitssubmitted
documentation.Tothecontrary,initspreviousresponsestoquestions,thegovernmentquotedprovisions
fromitscurrentCriminalCodewhichimposesfinesandimprisonmentforcopyright,patentortrademark
infringement. (Thenotion ofcounterfeiting andpiracy isincluded within thenotion ofinfringement).
Initsprevious response, thegovernment alsostated thatKyrgyzpatent hasintroduced proposed
amendments andsupplements tothedraft Criminal Code. SeeWTO Questions andAnswers,
20January 1997, page39.
Kyrgyzpatent'sabove-referencedproposedamendmentstothedraftCriminalCodeareasfollows:
1. Illegal exploitation ofanother 'strademark, service mark, firmname,or geographical indication
Illegal useofatrademark, service mark, firmname orgeographical indication, ifcommitted
repeatedly orinsuchawayastodamage therightholder: fineintheamount of200-400minimum
monthly wages, orimprisonment for1-2years.
Illegal useofawarning markinrelation toatrademark, service markorgeographical indication
notregistered intheKyrgyz Republic, ifcommitted repeatedly orinsuchawayastocause significant
damage totherightholder: fineintheamount of100-200minimum monthly wages, orimprisonment
for1year.
2. Infringement ofcopyright andneighbouring rights
Illegal commercial useofobjects ofcopyright andneighbouring rights insuchawayasto
damage therightholder: fineintheamount of200-400minimum monthly wages, orimprisonment
for3years, followed bydebarment fromemployment, ifemployment isrelated totheoriginal offense,
forupto3years.
Publication ofanother 'scopyrighted work under thepublisher 'sownname, other exploitation
oftherightholder 'srights ofcopyright and/or neighbouring rights, orimproper andcoercive claim
toco-authorship: fineintheamount of300-600minimum monthly wages, orimprisonment for5WT/ACC/KGZ/9
Page20
years, followed bydebarment fromemployment, ifemployment isrelated totheoriginal offense, for
upto5years.
Anyoftheforegoing actions which arecommitted (1)repeatedly; (2)bygroup ofpersons by
agreement; or(3)byanorganized group: imprisonment for3-7years, followed bydebarment from
employment orother activities, ifemployment oractivities arerelated totheoriginal offense, forup
to7years.
3. Infringement ofpatent holder 'srights
Illegalcommercialuseofaproductcontainingapatent,utilitymodel,industrialdesign,selection
achievement orintegrated circuit topography, conduct ofaprocess covered byapreliminary patent
orpatent, orintroduction intocommerce ofaproduct manufactured byapatented process, where such
conduct iswithout theconsent ofthepatent holder: fineintheamount of200-400minimum monthly
wages, orimprisonment forupto3years, followed bydebarment fromemployment, ifemployment
isrelated totheoriginal offense, forupto3years.
Misappropriation ofauthorship ofaninvention, utility model, industrial design, selection
achievement orintegrated circuit topography, improper orcoercive claim toco-authorship, disclosure
oftheelements ofaninvention, utility model, industrial design, selection achievement orintegrated
circuit topography, where suchconduct iswithout theconsent ofthepatent holder (orpatent applicant)
andoccurs prior toofficial publication: fineintheamount of300-600minimum monthly wages,
orimprisonment forupto5years, followed bydebarment fromemployment, ifemployment isrelated
totheoriginal offense, forupto5years.
Anyoftheforegoing actions which arecommitted (1)repeatedly; (2)bygroup ofpersons by
agreement; or(3)byanorganized group: imprisonment for3-7years, followed bydebarment from
employment, ifemployment isrelated totheoriginal offense, forupto7years.
Note: Under domestic legislation, "significant damage" isdeemed tobedamage inexcess of
500minimum monthly wages.
Question 53.
TheKyrgyz Republic doesnotcurrently haveanyspecial border measures relating tointellectual
property butstates inheranswer toquestion 155(WT/ACC/KGZ/5/Add.2, pages 46/7) thatborder
measures arecurrently being drafted. Could theKyrgyz Republic provide aprogress report (and
anydraft legislation) asshewillneedtohaveborder measures upon joining theTRIPs Agreement.
Answer:
Atpresent, thisissue isbeing considered from different points ofviewbyboththeCustoms
Agency andtheStateAgency onIntellectual Property. Thegovernment anticipates thattheamended
Customs Code, which willinclude border measures, willbeintroduced toParliament bytheendof
1997. Thegovernment 'sgoalistohavetheproper border measures inplace before WTO accession.WT/ACC/KGZ/9
Page21
VI. TRADE-RELATED SERVICES REGIME
Horizontal Measures
Temporary entry andstayofnatural persons
Question 54.
Could adescription ofthelawsandregulations affecting thetemporary entry andstayofnatural
persons beprovided, explaining thecriteria fortemporary entry andstay, thecosts incurred by
theapplicant andtowhom thepossibility oftemporary entry andstayisoffered (keypersonnel,
intra-corporate transferees, representatives ofservice suppliers etc.)?
Answer:
TheLawonRules ofStayofForeign Citizens of14December 1993 establishes general
provisions regarding entry, stayandexitofforeign citizens andstateless persons. Thepossibility of
temporary entry andstayisoffered toanyperson, including keypersonnel, intra-corporate transferees
andrepresentatives ofservice suppliers. Inorder toobtain avisa,theinviting resident company (branch
office, representative office) mustsubmit anapplication explaining therelationship between theapplicant
andtheperson. Incaseofemployment, thecopy oftheemployment contract must beprovided to
theConsular Department oftheMinistry ofForeign Affairs.
Theminimum period formultiple visasis1month. Upon therequest bythecompany-applicant,
theMinistry ofForeign Affairs issues asingle ormultiple visafortheperiod upto1year. Incase
ofemployment formore thanonemonth, apermit tohireaforeign citizen from theDepartment of
Migration ofPopulation must beobtained bythecompany.
Natural persons mustregister intheDepartment ofVisas andRegistration attheMinistry of
Interior within 3daysafterarrival totheKyrgyz Republic.
Please notethatnovisitor orwork visas arerequired forcitizens ofCIScountries.
Thefeeschedule forvisas isthefollowing:
Single visas Multiple visas
Period Rate Period Rate
upto3months US$35.00 upto6months US$95.00
upto1year US$55.00 upto1year US$125.00
Professional Services
Accountancy services
Question 55.
Could adescription ofthemarket beprovided fortheaccountancy sector, including anindication
ofthemarket access possibilities forforeign service suppliers, thelicensing criteria andprocedures,
andtheextent towhich foreign service suppliers enjoy national treatment?WT/ACC/KGZ/9
Page22
Answer:
TheLawonLicensing wasadopted on3March 1997. Applicants forlicenses toperform
activities subject tolicensing under thislawshould submit thefollowing documents: (1)license
application, (2)proof ofpayment oflicense fee,(3)copy ofstateregistration certificate, and(4)
documents demonstrating qualification ofapplicant. Regulations outlining qualification requirements
arebeing elaborated byauthorized bodies (e.g. regulations concerning auditing activities arebeing
currently developed bytheCounsel ofAuditors). Itisexpected thatthecriteria forobtaining licenses
willbemore orlesssimilar totheexiting regime asdescribed inAnnex 7ofWT/ACC/KGZ/3. Any
deviations from theexisting regime willbenotified infuture correspondence.
Asof1April 1997, there are53physical persons and26legalentities (including several with
foreign participation) licensed torender accountancy services intheKyrgyz Republic.
Only citizens oftheKyrgyz Republic areallowed toobtain licenses. AKyrgyz legalentity
mayobtain alicense ifitemploys alicensed individual. AKyrgyz legalentity maybe100percent
foreign owned. Foreign citizens maybeemployed byalicensed Kyrgyz legalentity.
Engineering andarchitectural services
Question 56.
Itisstated intheForeign Trade Memorandum thatformal licensing criteria have yettobe
established andthatdecisions onaccess tothese sectors aretaken onanad-hoc basisbytheMinistry
ofArchitecture andConstruction. Could theKyrgyz Republic confirm thatcriteria aretobe
established, andifso,when, andconfirm thatcurrent decisions aretaken inanon-discriminatory
manner whether theapplicant isaforeign service supplier oraKyrgyz national? Could an
indication begiven ofthenumbers ofapplicants andthenumber granted applicants?
Answer:
TheLawonLicensing wasadopted on3March 1997. Applicants forlicenses toperform
activities subject tolicensing under thislawshould submit thefollowing documents: (1)license
application, (2)proof ofpayment oflicense fee,(3)copy ofstateregistration certificate, and(4)
documents demonstrating qualification ofapplicant. Regulations outlining qualification requirements
arebeing elaborated byauthorized bodies (e.g.regulations concerning construction andarchitectural
services arebeing currently developed bytheMinistry ofArchitecture andConstruction).
Article 8oftheLawonLicensing stipulates thatforeign legalentities andphysical persons
shallreceive licenses onthesame conditions andprocedures aslegalentities andphysical persons of
theKyrgyz Republic, unless otherwise provided bylegislative acts. Currently, therearenolegislative
actsstipulatingdiscriminatorytreatmentconcerningissuanceoflicensesforengineeringandarchitectural
services.
Currently, there are107licenses validinthesector ofengineering andarchitectural services.
Allapplicants forlicences inthissector were granted licenses.WT/ACC/KGZ/9
Page23
Legal services
Question 57.
Itisstated thatforeign lawyers needtotakeanexam inorder toadvise onalltypes ofnon-criminal
law,including advice onhome country lawandinternational law. Once thelawyer haspassed
theexam, areanyfurther registration requirements necessary?
Answer:
Inrelation tothelawyers exam, doestheexam, onceitispassed, permit alawyer toadvise
onalltypes oflawincluding Kyrgyz law(except criminal law)orarerestrictions placed onthetype
oflawpractised?
Nofurtherregistrationisnecessary,oncethelawyerhaspassedtheexam.Pleasenote,however,
thatprior toapplying foralicense, registration asaphysical person forengaging inentrepreneurship
activities isrequired. Such registration isrequired forphysical persons engaged inanytypeof
entrepreneurship activity.
Alawyer, oncegranted alicense, canadvise onalltypes oflawincluding Kyrgyz Law(except
criminal law). There arenoother restrictions onthetypeoflawpractised.
Telecommunications
Question 58.
Inadvance offullliberalisation in2008, hastheKyrgyz Republic plans toliberalise other telecoms
services suchasmobile services, data, orvoice services forclosed-user groups (asopposed tovoice
services tothegeneral public)?
Answer:
Such telecoms services havebeenalready liberalized.
Could amore detailed description besupplied of:
Question 59.
theindependent regulator (istheregulator partofagovernment department; istheregulator
related inanywaytothemonopoly operator; howistheregulator financed)?
Answer:
Kyrgyztelecom(theoperator)isastate-ownedenterprisewhichhasamonopolyoverinternational
andlong-distance communication services. Local telephone networks areoperated bytheregional
branches ofKyrgyztelecom.
Kyrgyztelecom isastructural subdivision oftheDepartment ofCommunications under the
Ministry ofTransport andCommunications andisaccountable tothisdepartment.
TheStateInspectorate ofCommunications under theCommunications Department, byapproval
oftheMinistry ofTransport andCommunications, grants alltelecoms related licenses. TheDepartmentWT/ACC/KGZ/9
Page24
ofCommunications, inagreement withtheState Department onAnti-Monopoly Policy under the
Ministry ofFinance establishes tariffratesofservices provided byKyrgyztelecom andtheDepartment
ofCommunications.
TheDepartmentofCommunicationsispartiallyfinancedbythegovernmentandstatecompanies
inthecommunications business including Kyrgyztelecom andKyrgyzpost. TheDepartment of
Anti-Monopoly Policy isfinanced bytheKyrgyz Republic 'sbudget.
Question 60.
theinterconnection regime (ifthere isonlyonemain operator, howhastheinterconnection regime
developed; istheinterconnection regime transparent; areinterconnection agreements published;
isthere amodel interconnection agreement?)
Answer:
Interconnection isnegotiated between themainoperator ("Kyrgyztelecom") andtheapplicant
seeking access oruseofthenetwork inaccordance withtheregulations established bytheMinistry
ofTransport andCommunications (Regulations No.13of14April 1997). TheLawonCommunications
which isplanned tobeapproved in1997 willgovern interconnection inthefuture.
Theinterconnection regime istransparent andthere isaninterconnection agreement model.
There isnolegalrequirement forpublishing interconnection agreements. However, suchagreements
areavailable forinterested parties upon request from theDepartment ofCommunications under the
Ministry ofTransport andCommunications.
Question 61.
thelicensing procedures (howaretelecoms licences offered, howhasthenumber oflicences agreed;
isthenumber oflicences likely tobelimited inthefuture onthegrounds ofeconomic
considerations; orwould alllimitations onthenumber oflicences berelated totechnical
considerations suchastheavailability offrequency/spectrum)
Answer:
Thenumber oflicences isnotagreed onthegrounds ofeconomic considerations. Limitations
onthenumber oflicenses arerelated totechnical considerations such astheavailability of
frequency/spectrum. Currently, thenumber ofavailable licenses isnotlimited.
Question 62.
Inrelation totheuseofKyrgyztelecom 'snetwork, istheregulator involved innegotiations between
applicants seeking access oruseofthenetwork?
Answer:
Yes.Theregulator isinvolved innegotiations between Kyrgyztelecom andapplicants seeking
access oruseofthenetwork.WT/ACC/KGZ/9
Page25
Financial Services
Question 63.
Could information beprovided onthemarket ininsurance, theregulation ofthesector, themarket
access opportunities forforeign insurers andlimits onnational treatment?
Answer:
Asaresult oftheKyrgyz Republic 'spolicy onliberalization ofmarket andprivatization in
theinsurance sector, thestateinsurance monopoly "Kyrgyzstan" waseliminated. Currently, thereare
48insurance companies, fourofwhich arecompanies withforeign participation.
TheKyrgyzStateInsuranceInspectorate(KSII)isaregulatoryagencyresponsiblefordeveloping
regulations, issuing licenses, andmonitoring theinsurance sector.
OnlyKyrgyz legalentities, licensed bytheKSII, canengage ininsurance activities. Currently,
there isnolimit onforeign participation. TheKyrgyz Republic, however, intends tointroduce a
49percentlimitonforeign ownership ofinsurance companies. Rendering broking andagency services
onbehalf ofinsurance companies notresidents intheKyrgyz Republic isprohibited.
According totheKSIIOrder No.51dated 4September 1996, theMinimal Charter Fund of
insurance companies varies fromSom100,000 toSom1,000,000 depending onthetypeofinsurance
provided. There arealsolimits (ceilings) oninvesting assets ofinsurance companies.
AccordingtoCabinetofMinistersResolutionNo.475of16October1996,insurancecompanies
reinsuring risksabroad, mustretain nolessthan5percentoftheriskindomestic insurance market.
Recreational, Cultural andSporting Services
Question 64.
Itisstated under thissection intheForeign Trade Memorandum thatlicensing requirements
arenotstipulated inlegislation. Does thismean thatthere arenolicensing requirements, orthat
theyexist, butareinformal? Could thisbeexplained?
Answer:
TheLawonLicensing of3March 1997 liststhefollowing activities assubject tolicensing:
- repair ofsport arms (Ministry ofInternal Affairs);
- establishment andmaintenance ofgambling houses, organization ofgambling games (Ministry
ofInternal Affairs);
- mountain climbing (State Agency onTourism andSport);
- activity ofprivate sport schools andprofessional sport clubs (State Agency onTourism and
Sport).
There arenolicensing requirements forengaging inother types ofrecreational, cultural and
sporting services activities.
Applicants forlicenses toperform activities subject tolicensing should submit thefollowing
documents: (1)license application, (2)proof ofpayment oflicense fee,(3)copyofstateregistrationWT/ACC/KGZ/9
Page26
certificate,and(4)documentsdemonstratingqualificationofapplicant.Regulationsoutliningqualification
requirements arebeing elaborated byauthorized bodies (e.g.regulations concerning aforementioned
activities arebeing developed bytheMinistry ofInternal Affairs andtheState Agency onTourism
andSport).
Auxiliary Transport Services andOther Transport Services
Question 65.
Itisstated under thissection intheForeign Trade Memorandum thatlicensing requirements
arenotstipulated inlegislation. Does thismean thatthere arenolicensing requirements, orthat
theyexist, butareinformal? Could thisbeexplained?
Answer:
According totheLawonLicensing of3March 1997, thefollowing transport activities are
subject tolicensing:
- alltypes ofairtransport ofpassenger, luggage, mailandcargo, performance ofalltypes of
aviation works, receipt andrelease ofaircraft ofcivilaviation, technical services ofaircraft
andtheirequipment carried outontheterritory oftheKyrgyz Republic, andsaleofaviation
transportation ofalltypes offlights;
- transport activity andservices ensuring transportation process.
Please notethattheabove twocategories arebroadly defined under theLawonLicensing and
aretheonlytwotransportcategoriessubjecttolicensing.TheMinistryofTransportandCommunications
iscurrently preparing (1)thelistofspecific activities tobelicensed under these twobroad categories
and(2)regulations outlining qualification requirements.
Foreign Investment inServices
Question 66.
Inrelation toitsbilateral investment treaty withtheUS,willtheKyrgyz Republic extend the
preferential treatment exempting theUSfrom theprovisions outlined inparagraphs IV.3f)and
g)oftheForeign Trade Memorandum toallother WTO Members inaccordance withbasic GATS
principles?
Answer:
Thismatter willbediscussed during bilateral negotiations.WT/ACC/KGZ/9
Page27
VII. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC RELATIONS WITH THIRD
COUNTRIES.
Statistics
Question 67.
PleaseclarifyTable1.27ofWT/ACC/KGZ/3whichliststradebyregionin1995.Under"Europe",
twelve ofthefifteen Member States oftheEuropean Union arelisted individually. The"European
Union" features asaseparate entity. Arewetounderstand thatthe"European Union" lineactually
represents aggregate trade withthethree Member States nototherwise listed (i.e.Luxembourg,
Portugal, Spain)?
Answer:
Theentry inTable 1.27ofWT/ACC/KGZ/3 regarding theEuropean Union indicates only
humanitarian aidreceived byKyrgyzstan directly fromtheEuropean Union. Itdoesnotrefertothe
aggregate tradewiththethreeMember States nototherwise listed (i.e.Luxembourg, Portugal, Spain).
Question 68.
Could theKyrgyz Republic make acommitment torespect Articles XXIV GATT andVGATS
andtonotify promptly onaccession allfreetrade agreements orcustoms unions notalready notified
byoneoftheother partners? Inparticular, please confirm thattheKyrgyz Republic willadhere
toobligations under Article XXIV intheoperation ofacommon external tariff iftheCustoms
Union Agreement isratified.
Answer:
TheKyrgyz Republic commits torespect Articles XXIV GATT andVGATS andtonotify
promptly onaccession allfreetrade agreements orcustoms unions notalready notified byoneofthe
other partners.
TheKyrgyzRepublicwilladheretoobligationsunderArticleXXIVintheoperationofacommon
external tariff iftheCustoms Union Agreement isratified.
VII.2.Economic Integration, Customs Union andFreeTrade Agreements
VII.2(b) Customs union agreements
Question 69.
When in1997 doesParliament expect toratify theCustoms Union withRussia, Kazakstan and
Belarus bytheKyrgyz Republic?
Answer:
Theagreement onjoining theCustoms Union withRussia, Kazakstan andBelarus bytheKyrgyz
Republic iscurrently intheLegislative Assembly forconsideration. Once approved bytheLegislative
Assembly, itwillbesubmitted totheAssembly ofPeople 'sRepresentatives. Itisdifficult topredict
atthispoint when suchagreement willberatified.WT/ACC/KGZ/9
Page28
Question 70.
What areParliament 'sviews ontheGovernment 'spolicy onacceding totheWTO?
Answer:
Preliminary results ofconsideration bybothChambers oftheParliament (Legislative Assembly
andAssembly ofPeople 'sRepresentatives) oftheKyrgyz Republic Government 'spolicy onacceding
totheWTO areconsidered positive.
Question 71.
Article 1.2oftheAgreement ontheKyrgyz Republic 'saccession totheCustoms Union Agreement
requires uniformalization, within fourmonths ofthedateofsignature, oftherespective legislation
onexternal trade, customs, taxation, andcurrency andfinance asthese relate toforeign economic
activity, withfocus being placed on:
- economic conditions thatcould foster freeenterprise andprovide equal opportunities and
possibilities forbusinesses operating inthesignatory states;
- pricing policy;
- currency regulation andmonetary control;
- export controls;
- elimination ofunfair competition anddiscriminatory practices; and
- protection ofintellectual property.
Towhat extend hasKyrgyz Republic begun toharmonise itslegislation inrespect oftheabove
commitments withthatoftheother parties totheCustoms Union?
Answer:
Issues ofharmonisation oftheKyrgyz Republic 'slegislation connected withforeign tradewith
theCustoms Union 'srequirements arecurrently being studied atthelevelofministries andstateagencies
oftheKyrgyz Republic.
Question 72.
Weunderstand thatallfourparties totheCustoms Union Agreement have signed aProtocol to
theeffect thattheyintend toaccede totheWTO asseparate countries, withentirely separate
market access negotiations, though inconsultation witheach other. Wewould note, however,
thatnotwithstanding thisProtocol, thetransition towards harmonisation offoreign trade policy
raises serious questions about theability oftheParties tonegotiate accession totheWTO entirely
separately:
(i) itseems likely thatthecoverage ofanyparties 'tariffs commitments intheWTO might
needtobeextended tosome parties notparticipating inthenegotiation: ifoneparty weretoaccede
before theothers there would bepressure fortheother parties totheCustoms Union toaccept
those same tariff commitments.
(ii) there isnoguarantee thatlegislative programmes and tariff commitments undertaken
byanysingle party would indeed bemaintained after accession, astheCustoms Union requires
eventually fullharmonisation offoreign trade policy.WT/ACC/KGZ/9
Page29
(iii) clarification willalsobeneeded ofsuggestions thatthecustoms union maybedeveloped
intoabroader agreement covering other areas suchasservices. Ifthere areplans forsucha
development, anindication from theKyrgyz Republic (anditspartners) ofthescope andtimetable
willbenecessary.
Wewould welcome comment from theKyrgyz Republic ontheabove considerations.
Answer:
Asoftoday, there isnocomplete harmonisation oftariff obligations intheCustoms Union.
Eachcountry iscurrently following itsexport andimport tariff duties. TheCustoms Union doesnot
cover services.
Question 73.
What isthenature ofthecustoms control attheborders between theKyrgyz Republic and
Kazakstan? Areallconsignments stopped andchecked, whatever their country oforigin?
Answer:
There isnodifference inthenature ofcustoms control withKazakstan andother countries.
Itissimply toprocess import, export, andtransit shipments andprevent smuggling. Allconsignments
arestopped andchecked, whatever theircountry oforigin.
VII.2(c) Freetrade areaagreements
Question 74.
Please inform theWorking Party ofprogress inobtaining information ondetails ofthepercentage
trade overall andineachmajor sector thatisexcluded from freetrade regime eachfreetrade
agreement, andprovide anyinformation available todate.
Answer:
Kyrgyzstan hasbilateral freetradeagreements withArmenia, Kazakstan, Moldova, theRussian
Federation andUkraine. There wasnotrade withArmenia connected withexempted goods during
1996.
Listofgoods thatareexempted from thefreetrade (Import)
1996
Good Categories Code Import
(Thousand US$)%oftotal %ofimport from the
concerned country
Russia
Military arms andgoods 93040 121.6 0.015 0.106
Explosives 36020 761.1 0.091 0.666
Narcotics andpsychotropic
substances29420 445.2 0.053 0.389
Kazakstan
Military arms andgoods 88020 18.9 0.002 0.017WT/ACC/KGZ/9
Page30
1996
Good Categories Code Import
(Thousand US$)%oftotal %ofimport from the
concerned country
93060 46.3 0.006 0.041
Explosives 36020 100 0.012 0.089
Narcotics andpsychotropic
substances29420 496.3 0.059 0.441
Ukraine
Narcotics andpsychotropic
substances29420 69.6 0.008 1.409
Uzbekistan
Explosives 36020 15.9 0.006 0.012
Narcotics andpsychotropic
substances29420 49.7 0.002 0.038
Listofgoods thatareexempted from thefreetrade (Export)
1996
Good Categories Code Export
(Thousand US$)%oftotal
export%ofexport tothe
concerned country
Russia
Mercury 28054 120.4 0.014 0.087
Gold 71081 2.3 0.0003 0.002
Article ofgold 71141 18.1 0.002 0.012
Antimony andarticles
thereof, including waste and
fragments81100 4,765.7 0.569 3.539
Military equipment 87100 265.9 0.031 0.193
Aeroplane 88023 3.9 0.0005 0.003
Kazakstan
Mercury 28054 45.5 0.005 0.037
Narcotics andpsychotropic
substances29420 5.1 0.0006 0.004
Gold articles 71141 16.7 0.002 0.015
Antimony andarticles
thereof, including waste and
fragments81100 292.5 0.035 0.260
Military equipment 87100 5.5 0.0007 0.005
Ukraine
Antimony andarticles
thereof, including waste and
fragments81100 12.5 0.0015 0.133
Uzbekistan
Explosives 36020 38.5 0.005 0.033
Copper waste andfragments 74040 2,111.6 0.252 1.824WT/ACC/KGZ/9
Page31
Question 75.
Please provide theWorking Party with copies oftheProtocols attached totheFree Trade
Agreements either inforce, or,ifavailable, expected toenter intoforce inthenearfuture.
Answer:
CopiesoftextsandprotocolsofallFreeTradeAgreementswereprovidedtotheWTOSecretariat
asanattachment toWT/ACC/KGZ/5. Please findattached theprotocol ofagreement withUzbekistan
which wasrecently signed.
Question 76.
Attherecent summit ofCISHeads ofState, allcountries, apparently signed uptotheconcept
offurther economic integration. Wewould begrateful forfurther detailed information about
thenature oftheproposed integration, including acopyofthe(98-page) "concept paper" discussed
atthemeeting, andwhich wascited asbeing available forcirculation atthesubsequent press
conference.
Answer:
The"concept paper" regarding economic integration development hasbeensenttoallstates
forrevision. Thetextofthisdocument willbepresented afteritsfinalapproval andsignature.
Publication.
Question 77.
Isthere alegalrequirement lawtopublish alllegislation andadministrative actsonWTO related
issues?
Answer:
There isnolegalrequirement topublish alllegislation andadministrative actsonWTO related
issues. However, inpractice, alllaws, decrees, andresolutions arepublished innational newspaper.WT/ACC/KGZ/9
Page32
ATTACHMENT
AGREEMENT
onFreeTrade between theGovernment oftheKyrgyz Republic
andtheGovernment oftheRepublic ofUzbekistan
TheGovernment oftheKyrgyz Republic andtheGovernment oftheRepublic ofUzbekistan
hereinafter called Contracting Parties,
aspiringtothedevelopmentoftradeeconomiccooperationbetweentheKyrgyzRepublicandtheRepublic
ofUzbekistan onthebasis ofequality andmutual advantage,
taking intoaccount theformed integration economic relations oftheKyrgyz Republic andtheRepublic
ofUzbekistan, andintercomplementation ofeconomies oftwocountries,
following theprovisions oftheAgreement oncreation ofaCommon Economic Area,
considering thatfreemovement ofgoods andservices require carrying outmutually coordinated
measures,
confirming theadherence oftheKyrgyz Republic andtheRepublic ofUzbekistan totheprinciples
oftheGeneral Agreement onTariffs andTrade (GATT) andoftheWorld Trade Organization (WTO),
haveagreed upon thefollowing:
Article 1
TheParties following theprinciples ofequality, mutual profit andinterest shalldevelop and
expand trade economic relations between business entities regardless theirform ofownership onthe
basis ofdirect economic relations withfollowing legislative actsinforce intheContracting states.
Either Party shallrefrain from actions which candamage economically theother Party.
Article 2
1. TheContracting Parties shallprovide eachother withfreetrade regime.
TheContracting Parties shallnotapply customs duties, taxes andlevies which equally affect
exportation and/or importation ofgoods originating fromthecustoms territory ofoneoftheContracting
Parties andintended forthecustoms territory oftheother Contracting Party. Besides, quantitative
restrictions areapplied. According tothecoordinated Goods Nomenclature exclusions fromthistrade
regime shallbeintheform ofdocuments, which areanintegral partofthisAgreement.
2. Inaccordance withpar1hereof theContracting Parties shallyearly work outandcoordinate
ageneralscheduleofwithdrawalsfromthefreetraderegime,andmethodsofapplyingsuchwithdrawals.
3. Forthepurposes ofthisAgreement andfortheperiod ofitseffect, goods originating from
theterritories oftheContracting Parties shallbegoods determined byRegulations ofEstablishing a
Country ofOrigin of24September, 1993 approved byDecision ofGovernment Heads 'Council of
theCommunity oftheIndependent States.WT/ACC/KGZ/9
Page33
Article 3
Either Contracting Party shallnot:
- directly orindirectly impose ongoods oftheother Contracting Party falling under theeffect
ofthisAgreement domestic taxes orlevies exceeding thecorresponding taxes orlevies which
areimposed onsimilar goods ofdomestic production orgoods originating fromthirdcountries;
- introduce inrespect ofimportation orexportation ofgoods, falling under theeffect hereof,
anyspecial restrictions andrequirements, which inasimilar situation arenotapplied tosimilar
goods ofdomestic manufacture ortogoods originating from thirdcountries;
- apply inrespect ofstorage, transshipment, transportation ofgoods originating fromtheterritory
oftheother Contracting Party, andinrespect ofpayments andtransfer ofpayments rulesother
thanthose which aresimilarly applied inrespect ofitsowngoods orgoods originating from
thirdcountries.
Article 4
Inmutual trade theContracting Parties shallrefrain fromapplying discriminatory measures,
introducing quantitative restrictions orequivalent withthemmeasures onexportation and/or importation
ofgoods under thisAgreement.
TheContracting Parties mayunilaterally establish quantitative orother special restrictions,
butonlyinreasonable limits andforastrictly appointed time.
These restrictions musthaveexclusive character andmaybeapplied onlyincases provided
byAgreements under theGATT/WTO.
AContracting Party which applies quantitative restrictions incompliance withthisArticle must,
asfaraspossible, inadvance, provide theother Party withfullinformation concerning thebasicreasons
ofintroduction, forms andsupposed terms ofapplying thementioned restrictions. After this,
consultations shallbescheduled.
Article 5
ThisAgreement shallnothamper therightofeither oftheContracting Parties tounilaterally
accept measures ofstateregulation intheareaofforeign economic relations generally accepted inthe
international practice which itconsiders necessary forprotection ofitsvitalinterests, orwhich are
necessary toimplement theinternational agreements ofwhich itisaparticipant orintends tobecome
aparticipant, ifthese measures concern:
- protection oflifeandhealth ofpeople, environment, animals andplants;
- protection ofpublic moral andorder; guarantee ofnational safety;
- tradeinarm,ammunition andmilitary equipment; deliveries offissionable materials andsources
ofradio-active substances, utilization ofradio-active wastes;
- trade ingold, silver orother precious metals andstones; preservation ofsank(which cannot
befilled in)natural resources;
- violation ofbalance ofpayment;
- limitation ofproducts export, ifdomestic prices forthem arelower thantheworld prices as
aresult ofimplementation ofstatesupport programs;
- protection ofindustrial andintellectual property; protection ofvalues ofnational property;
- measures applied inmilitary timeorunder other extraordinary circumstances ininternational
relations;WT/ACC/KGZ/9
Page34
- actions forfulfillment ofobligations onthebasis oftheUNO'sCharter topreserve the
international world andsafety.
AContracting Party which applies suchmeasures incompliance withthisArticle must, asfar
aspossible, inadvance, provide theother Contracting Party withfullinformation concerning thebasic
reasons ofintroduction, forms andsupposed terms ofapplying thementioned restrictions. After this,
consultations shallbescheduled.
Article 6
Allsettlements andpayments ontrade economic cooperation between theContracting Parties
shallbecoordinated byaseparate inter- banking agreement.
Article 7
TheContracting Parties shall exchange, onaregular basis, information ondomestic legal
regulation offoreign economic relations, aswellasonissues oftrade, investments, taxation, banking
andinsurance activity andother services, ontransport andcustoms issues, including customs statistics
concerning theContracting Parties.
TheContractingPartiesshallimmediatelyinformeachotherofchangesinthenationallegislation
which mayaffect implementation ofthisAgreement.
Authorized bodies oftheContracting Parties shallcoordinate theprocedure forexchanging
suchaninformation.
Theprovisions ofthisarticle shallnot:
- beinterpreted asthose which bindcompetent bodies ofeither Contracting Party togive
information which, according tolegislation orinthecourse ofusual administrative practice
ofoneoftheContracting Parties, cannotbereceived;
- provide information which would disclose atrade, entrepreneurship, industrial, commercial,
orprofessional secret, ortrade process, orother information disclosure ofwhich would
contradict thenational interests oftheContracting Party.
Article 8
TheContracting Parties shallacknowledge incompatibility ofunfair business practice withthe
objectives ofthisAgreement andbeobliged nottoallow andeliminate thefollowing methods ofthe
practice:
- agreements between enterprises, decisions made bytheenterprises 'associations, andgeneral
methods forbusiness practice aiming atpreventing fromorrestricting competition orviolating
conditions forcompetition ontheterritories oftheContracting Parties;
- actions withthehelpofwhich oneorseveral enterprises usetheirdominant position restricting
competition onthewhole oronaconsiderable partoftheterritory oftheContracting Parties;
Article 9
Incarrying outmeasures oftariffandnon-tariff regulation ofbilateral economic relations, for
exchange ofstatistical information andcarrying outcustoms procedures, theContracting Parties shall
apply asingle 9-digit Goods Nomenclature ofForeign Economic Activity (GNFEA) based ontheWT/ACC/KGZ/9
Page35
HS-system ofdescription ofandcoding goods andCombined tariff-statistical nomenclature ofthe
European Economic Union. TheContracting Parties fortheneeds oftheircountries, ifnecessary,
shallcarry outthedevelopment ofGoods Nomenclature beyond 9digits.
Introduction ofastandard copyoftheGoods Nomenclature shallbecarried outonamutually
coordinated basis through theexisting representations incorresponding international organizations.
Article 10
TheContracting Parties haveagreed thatfollowing aprinciple oftransit freedom shallbethe
mostimportant condition forachieving theobjectives ofthisAgreement andanessential element of
theprocess oftheirattachment tothesystem ofinternational division oflabor andcooperation.
Inthisrespect, either Contracting Party shallprovide withafreetransit viaitsterritory of
goods, originating from thecustoms territory oftheother Contracting Party and/orthirdcountries
andintended forthecustoms territory oftheother Contracting Party orofathird country. Either
Party shallprovide exporters, importers orcarriers withallmeans andservices available andnecessary
forensuring transit, onterms notworse thanthose onwhich thesamemeans andservices areprovided
toownexporters, importers orcarriers ofanythirdstate.
Theprocedure andconditions formovement ofgoods overtheterritory oftheContracting
Parties shallberegulated incompliance withinternational Transportation Rules.
Article 11
Either Contracting Party shallnotallow non-sanctioned re-export ofgoods (inrespect oftheir
exportation theother Contracting Party, where these goods originate from, applies measures ofstate
regulation and/or grants foreign economic privileges during theirexportation fromitscustoms territory).
TheContractingPartiesshallestablishascheduleofgoodswhichareprohibitedtobere-exportedwithout
permission. They shallalsoexchange schedules ofgoods towhich measures ofstateregulation are
applied.
Re-export ofsuchgoods tothirdcountries maybecarried outonlybywritten agreement and
onterms defined byauthorized body ofthestatewhich isacountry oforigin ofthese goods.
Article 12
With aview tofollow anagreed policy ofexport control inrespect ofthird countries, the
Contracting Parties shallconduct regular consultations andtakemutually agreed measures forcreation
ofeffective export control system.
Article 13
Theprovisions ofthisAgreement shallreplace provisions ofbilateral agreements concluded
earlier between theContacting Parties, ifthelatter iseither notcompatible withtheprovisions ofthis
Agreement orsimilar withthem.
Article 14
NothinginthisAgreementshallpreventanyoftheContractingPartiesfromestablishingrelations
withthird countries, fulfilling undertaken obligations incompliance withanyother internationalWT/ACC/KGZ/9
Page36
agreement, ofwhich thisContracting Party isaparticipant ormaybeaparticipant provided thatthese
relations andobligations donotcontradict theprovisions andobjectives hereof.
Article 15
Each Contracting Party incompliance withitslegislation andinternational obligations shall
provide equal legal, aswellasjudicial protection ofrights andlegalinterests ofbusiness entities of
theother Contracting Party.
Article 16
DisputesbetweentheContractingPartiesregardinginterpretationorapplicationoftheprovisions
hereof shallbesettled bywayofnegotiations orbyother wayacceptable fortheContracting Parties.
TheContracting Parties shallaspire toavoid conflict situations inmutual trade.
Article 17
Tocarry outtheobjectives ofthisAgreement andwork outrecommendations onimproving
trade economic cooperation between twocountries, theContracting Parties haveagreed toestablish
ajointUzbek-Kyrgyz Commission.
Article 18
Ifnecessary, amendments orsupplements canbemade byagreement oftheParties.
Article 19
ThisAgreement shallcome intoforce fromthedateofexchange ofnotifications onfulfillment
bytheContracting Parties ofinner-state procedures andshall beinforce before theexpiration of
12months fromthedatewhen oneoftheContracting Parties sends awritten notification totheother
Contracting Party ofitsintention tostoptheeffect oftheAgreement.
TheprovisionsofthisAgreement,afteritseffectisstopped,shallbeappliedtocontractsbetween
enterprises andorganizations ofbothcountries concluded butnotfulfilled intheperiod ofitseffect,
butnomore than5years.
Done inthecityofTashkent on24December, 1996intwooriginals, eachisinKyrgyz, Uzbek,
andRussian. Allthetextsshallbeequally valid.
Inorder tointerpret theprovisions ofthisAgreement thetextinRussian shallbepreferable.
FortheGovernment oftheKyrgyz Republic FortheGovernment ofUzbekistanWT/ACC/KGZ/9
Page37
PROTOCOL
onWithdrawal from FreeTrade Regime
totheAgreement between theGovernment oftheKyrgyz Republic
andtheGovernment oftheRepublic ofUzbekistan of"__"December 1996
TheGovernment oftheKyrgyz Republic andtheGovernment oftheRepublic ofUzbekistan
further referred toasContracting Parties haveagreed upon thefollowing:
Article 1
Withdrawals provided byArticle 2oftheAgreement onFreeTrade between theGovernment
oftheKyrgyz Republic andtheGovernment oftheRepublic ofUzbekistan of"__"December 1996
shallapply to:
1. Goods falling under theeffect ofexport tariff legislation oftheRepublic ofUzbekistan, also
oflegislation onlicensing andquoting ofexport andimport (ofworks andservices) which isinforce
atthemoment ofcustoms clearance ofgoods during theirexportation orimportation fromtheRepublic
ofUzbekistan totheKyrgyz Republic orviceversa. Forthemoment ofsigning thisProtocol, export
tariffs andrestrictions intheareaofnon-tariff regulation ofexport andimport established byNo219
Resolution oftheCabinet ofMinisters oftheRepublic ofUzbekistan of18June1996 (Annexes 1,
2)andNo287Resolution of25July1995 (Annexes 3,4,5,6,8,9) shallbeinforce.
2. Goods falling under theeffect ofexport tariff legislation oftheKyrgyz Republic, alsoof
legislation onlicensing andquoting ofexport andimport ofgoods (works, services) which isinforce
atthemoment ofcustoms clearance during theirexportation/importation from theKyrgyz Republic
totheRepublic ofUzbekistan andviceversa (atthemoment ofsigning thisProtocol export tariffs
andrestrictions intheareaofnon-tariff regulation ofexport andimport established byNo408
Governmental Resolution oftheKyrgyz Republic of13June1994andNo97Governmental Resolution
of22March 1995 shallbeinforce).
TheContracting Parties shallimmediately inform eachother ofallchanges ofthedomestic
legislation ontheabove mentioned issues.
Article 2
1. Inrespect ofgoods towhich tariffandnon-tariff restrictions ofexport areapplied incompliance
withArticle 1hereof, theContracting Parties shallprovide eachother withtheMFN treatment ifit
concerns:
- customs duties andlevies ,charging ofsuchduties andlevies, procedures andrules relating
toexportation ofgoods, including those which relate tocustoms clearance, transit, storage
andtransshipment ofgoods;
- taxes andother domestic levies ofanykinddirectly orindirectly related togoods which are
exported;
- rulesofsale,purchase, transportation, distribution anduseofgoods onthedomestic market;
- issue oflicenses.
Article 3
Theprovisions ofArticle 2hereof shallnotbeusedinrespect ofadvantages andprivileges
provided byeachoftheContracting Parties: tothirdcountries inorder tocreate acustoms union or
afreetrade zone, orasaresult ofcreation ofsuchaunion orazone; todeveloping countries ontheWT/ACC/KGZ/9
Page38
basisofinternational agreements; neighboring countries withaviewtofacilitate frontier trade; toeach
other incompliance withspecial Agreements.
Article 4
1. ThisProtocol shallbeanintegral partoftheAgreement onFreeTrade between theGovernment
oftheKyrgyz Republic andtheGovernment oftheRepublic ofUzbekistan of"___" December 1996
andcome intoforce atthesame timewiththementioned Agreement.
2. ThisProtocol shallbeinforce fortheperiod untilanewProtocol provided byArticle 2of
theAgreement onFreeTrade issigned.