RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/RUS/25/Add.1 
4 June 2002 
 (02-3060) 
Working Party on the Accession 
of the Russian Federation  
 
 
 
DRAFT REPORT OF THE WORKING PARTY ON THE 
ACCESSION OF THE RUSSIAN FEDERATION  
TO THE WORLD TRADE ORGANIZATION  
 
Addendum  
 
  Attached are the consolidated list of comments, proposals and requests for specific 
information or clarification emanating from the first draft of the Working Party Report on the Accession of the Russian Federation to the WTO (document WT/ACC/SPEC/RUS/25 refers). 
 
 The Secretariat has given an individual numbe r to each and every request.  Please note that 
the second set of numbers, in bold, refer to the paragraph numbering found in the draft Working Report.     
 
 WT/ACC/SPEC/RUS/25/Add.1 
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 CONTENTS 
 
ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE ...................................................1 Economic Policies.............................................................................................................. .....................1 
- Monetary and Fiscal Policies  (paras 7-10).............................................................................1 
- Foreign Exchange and Payments System (paras 11-18)........................................................2 
- Investment Regime (paras 19-21)............................................................................................7 - State Ownership and Privatizat ion (paras 22-37, tables 1-6)................................................7 
- Pricing Policies (paras 38-51, tables 7-9) ................................................................................9 - Competition Policy (paras 52-58) ..........................................................................................12 
FRAMEWORK FOR MAKING AN D ENFORCING POLICIES .................................................13 
Powers of executive, legislative and judicial branches of governments ..........................................13 
- Branches of State Power, Federal Structure and Delimitation of Jurisdiction 
between Federal and sub-Federal Authorities  (paras 59-79).............................................13 
POLICIES AFFECTING TRADE IN GOODS ................................................................................15 
Trading Rights (the right to import and export)  (pages 80-93 and Table 10)...............................15 
Import Regulations ............................................................................................................. .................18 
- Customs Regulations and Customs Tariff (para 94) ...........................................................18 - Ordinary Customs duties (paras 95-100, Tables 11-12) ......................................................19 - Tariff Quotas, Tariff Exem ptions (paras 101-105) ..............................................................19 
- Other Duties and Charges (paras 106-108) ..........................................................................21 
Fees and Charges for Services Rendered (paras 109-115 and Tables 13-14) .................................22 
- Consular Fees (paras 116-119 and Table 15)........................................................................23 
- Other Fees (paras 120-121 and Tables 16 (a) and 16 (b).....................................................24 - Import Surcharge (paras 122-123)........................................................................................24 
Application of Internal Taxes on Imports ....................................................................................... ..25 
- Excuse Taxes (paragraphs 124-128, Table 17) .....................................................................25 
- Value Added Tax (paras 129-135, Table 18) ........................................................................25 Quantitative import restrict ions  (paras 136-138).............................................................................2 7 
Import Licensing Systems (paras 139-152 and Tables 19 (a) and (b) .............................................27 - Customs Valuation (paras 153-161) ......................................................................................30 - Rules of Origin (paras 162-171).............................................................................................3 1 
- Other Customs Formalit ies (paras 172-176) ........................................................................31 
- Pre-shipment Inspection (paras 177-178) .............................................................................32 - Anti-Dumping, Countervailing Duties a nd Safeguard Regimes (paras 179-184) .............33 
Export Regulation.............................................................................................................. ..................33  WT/ACC/SPEC/RUS/25/Add.1 
 Page iii 
 
 
 - Export Duties (paras 185-188) ...............................................................................................3 3 
- Quantitative Export Restrictions, Incl uding Prohibitions and Quotas (paras 189-
190) ........................................................................................................................... ................34 
- Export Licensing Procedures (paras 191-195, Tables 20 (a) and (b)) ................................35 - Export Financing, Subsidy and Pr omotion Policies (paras 196-198).................................36 
3. Internal Policies Affecting Foreign Trade in Goods ............................................................36 
- Industrial policy, including s ubsidy policies (paras 199-206) .............................................36 
- Technical Regulations and Standards, Including Measures Taken at the Border 
with Respect to Imports........................................................................................................ ..38 
- Technical Barriers to Trade (paras 207-223) .......................................................................38 
- Sanitary and Phytosanitary Measures (paras 224-243).......................................................40 
- Trade-Related Investment Measures (paras 244-248).........................................................46 - State-trading Practices (paras 249-255)................................................................................46 - Free Zones and Special Economic Zones (paras 256-263) ..................................................48 - Government Procurement Practices (paras 264-266)..........................................................48 
- Regulation of Trade in Transit (paras 267-269)...................................................................49 
- Policies Affecting Foreign Trade in Ag ricultural Products (paras 270-272).....................49 
- Trade in Civil Aircra ft (paras 273-274) ................................................................................53 
- Textiles (paras 275-276)..................................................................................................... .....53 
TRADE-RELATED INT ELLECTUAL PROPERTY REGIME (TRIPS) ....................................53 
General (paras 277-281) ........................................................................................................ ..............53 
- Copyright and Related Rights (para 282).............................................................................55 
- Trademarks, including Service Marks (para 283)...............................................................55 - Geographical Indications, Including A ppellations of Origin (paras 284-285) ..................56 
- Inventions and Industrial Designs (para 286) ......................................................................57 - Plant Variety and Animal Breed Protection (para 287)......................................................57 
- Layout Designs of Integrated Circuits (para 288)................................................................57 
- Requirements on undisclosed information,  including trade secrets and test data 
(para 289)..................................................................................................................... ............57 
- Enforcement .................................................................................................................. ..........58 
- Criminal Measures (paras 290-291) ......................................................................................58 - Criminal Procedure (paras 292-293).....................................................................................59 
- Administrative Matt ers (paras 294-295)...............................................................................59 
- Border Measures (paras 296-298) .........................................................................................60 - Civil Law Remedies and Pr ocedure (paras 299-303)...........................................................60 
TRADE-RELATED SE RVICES REGIME ......................................................................................62 
- Policies Affecting Trade in  Services (paras 304-319)...........................................................62 WT/ACC/SPEC/RUS/25/Add.1 
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 TRANSPARENCY ................................................................................................................... ...........65 
- Publication of Information on Trade (paras 320-323).........................................................65 
- Notifications (paras 324-325) ................................................................................................ .65 
FREE TRADE AND CUSTOMS UNIONS AGREEMENTS (paras 326-332) ..............................65  WT/ACC/SPEC/RUS/25/Add.1 
 Page 1 
 
 
 ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE 
Economic Policies - Monetary and Fiscal Policies  (paras 7-10) 
1. 7-10   This section moves quickly from the first m eeting of the Working Party to the current 
situation, glossing over a lot of progress whic h has been accomplished in between.  It is 
important in a Working Party Report to understa nd what changes have been made in the 
direction of meeting WTO commitments as a frame of reference following accession. Accordingly, this section should contain salient poi nts showing the evolution of reform in this 
area since the accession process began.  In P.8 details are needed on VAT administration including procedures relating to CIS countries. A consolidation of all tax references (VAT) in 
one area of the report would be useful. 
 
2. 7 We welcome the listing at paragraph 7 of existing legislative instruments relating to 
internal taxation.  At paragraph 7 it is stated that the introduction of a new Tax Code in 1998 
and amendments to the Code have brought Ru ssia’s taxation regime into compliance with 
WTO requirements.  However no information is provided on: 
- how Russian legislation prior to the enactment and amendment of the Code was not 
in conformity with WTO requirements; 
- how the enactment and amendment of the Code addressed lack of conformity with 
those provisions. 
This information will need to be included in the draft Report. 
 
3. 8 We welcome the acknowledgement  provided at paragraph 8 that concerns have been 
raised by Members over discrimination in domestic taxation, including: - whether all differential treatment in favour  of Russia’s imports from and exports to 
other CIS countries had been eliminated; 
- whether taxation at sub-federal level was similarly consistent with WTO 
requirements; 
- whether VAT was being applied on exported products. 
 
 At paragraph 8 it is claimed that Russia’ s indirect taxation regime was brought into 
conformity with WTO requirements with the enactment and amendment of the Tax Code. 
- An explanation of the basis for this claim w ill need to be included in the draft Report. 
 Paragraph 8 also contains no response by Russia to concerns raised by Members on: - whether all differential treatment in favour  of imports from and exports to other CIS 
countries had been eliminated; 
- whether taxation at sub-federal level was similarly consistent with WTO 
requirements; 
- whether VAT was being applied on exported products. 
-  
Responses by Russia to these concerns will need  to be included in the draft Report. 
Paragraph 8 moreover provides no commitment language in relation to achievement of 
appropriate WTO conformity before accession a nd the maintenance of WTO conformity from 
the date of accession.  - Appropriate commitment language will need to be included in the draft Report. 
 WT/ACC/SPEC/RUS/25/Add.1 
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 4. 9: We note that currently, notwithstanding the description in this paragraph, the Russian 
Central Bank appears to rely unduly on manage ment of the exchange rate and foreign 
reserves and on depository operations  to conduct monetary policy, rather than being able to 
use more standard tools, e.g., refinancing a nd interest rate management.  We seek Russia’s 
comment on this issue and on its plans to impr ove the situation, and we would appreciate 
reflection of these views in the draft Report text. 
 5. 10: Russia should provide the information request ed in this paragraph, e.g., information 
on the new package of banking laws (the “IMF  package”),  and on the banking reform policy 
recently signed by the Prime Minister.  In pa rticular, we seek elaboration of Russia’s plans 
and priorities under the banking reform strategy  of the new Central Bank Chairman.  This 
information should be incorporated into the text.   
 
- Foreign Exchange and Payments System (paras 11-18) 
6. 11-18  In our view, this section requires more de tail – especially P.18 which should provide 
the answers to the questions raised.  If exchange  restrictions remain to combat capital flight 
and money laundering, the report should say so a nd describe what measures are in place.  The 
report should also state that multiple cu rrencies have not been used since 1994. 
 7. 11:    At paragraph 11, it is disclosed that six fo reign exchange restrictions are still in force. 
At paragraph 11, no details are pr ovided of foreign exchange rest rictions applied in the past, 
or of the reforms that led to their elimination. 
- Such details will need to be included in the draft Report. 
At paragraph 11, it is not stated what the excha nge restrictions still in force are.  No details 
are provided on: - the nature of the six foreign exchange restrictions 
- their legal basis 
- their purpose and WTO justification 
- the circumstances that led to their introduc tion, and whether those circumstances still 
exist 
- Russia’s plans to eliminate those restricti ons, if they have not been eliminated 
already. 
- Such details will need to be included in the draft Report. 
 
At paragraph 11, it is claimed, but not proven, th at the exchange restrictions in force are “of 
minor economic significance”.  The basis for an y such claim will need to be clarified in 
appropriate detail in the draft Report. 
 
If these exchange restrictions can be shown to  be “of minor economic significance”, Russia 
will need to explain in this section of the dr aft Report why it has failed to eliminate them, 
despite the circumstances which led to their in troduction no longer prevailing.  We note that 
Russia has used other arguments in an attempt to  justify the continued use of such exchange 
restrictions.   
 
We do not
 accept that such restrictions, which clearl y target directly or otherwise adversely 
affect current transactions in a substantial way, are the only means available, appropriate means or preferred means for addressing capital f light or illegal capital flows.  We strongly 
support Members’ calls for Russia to address these problems by means other than the 
currently applied restrictions affecting current transactions. 
 8. 12. At paragraph 12, there is acknowledgement  of Members’ concerns over existing 
requirements on foreign exchange acquisition and retention inhibiting trade.  We appreciate  WT/ACC/SPEC/RUS/25/Add.1 
 Page 3 
 
 
 this.  However it is not entirely accurate to say  that Members were concerned that existing 
requirements on foreign exchange acquisition and retention might inhibit trade, as claimed at 
paragraph 12.  It would be more accurate to say that Members were concerned that existing 
requirements on foreign exchange acquisition and retention actually inhibited trade.  
Members sought to register those concerns because the initial introduction of these measures 
by Russia was a factor in closing Russia’s mark ets for a number of products of interest to 
them and these measures continue to impede market access. - An appropriate correction will need to be included in the draft Report. 
At paragraph 12, it is stated that Members re quested information on existing requirements on 
foreign exchange acquisition and retention.  It is not indicated at paragraph 12 or anywhere 
else in the draft Report in addition to what information already provided that Members had 
requested “additional information”. - If the term “additional information” is to be  used in the draft Report, details of the 
initial information supplied by Russia will need  to be included in the draft Report.  
At paragraph 12 or anywhere else in the draft Report, it is not stated that, in relation to 
existing requirements on foreign exchange acqui sition and retention, Members sought details 
of: - the nature of the requirements 
- their legal basis 
- their purpose and WTO justification 
- the circumstances that led to their introduc tion, and on whether those circumstances 
still exist 
- Russia’s plans to eliminate those restricti ons, if they have not been eliminated 
already. 
Such details will need to be included in the draft Report. 
 
9. 13 Please specify the law that authorizes the 1 percent charge for foreign exchange and 
give information on the legislation under c onsideration in the Duma to eliminate it. 
 10. 13  At paragraph 13, it is disclosed that th ere is a tax of 1 per cent on the purchase of 
foreign currency in cash.  We welcome this di sclosure, even though we are disappointed by 
the measure. 
The tax of 1 per cent on the purchase of foreign cu rrency in cash is inconsistent with the non-
discrimination provisions of GATT Article III and the requirement under GATT Article XI 
and Article 4 of the Agriculture Agreement to eliminate unjustifiable restrictions on importation. The provision that purchases of foreign exch ange for payments made 90 days prior to 
importation are subject to the tax, and all form alities, fees and requirements associated with 
the implementation of that provision, also discriminate against imports from more distant Members, and accordingly are inconsistent with the non-discrimination provisions of GATT Article I. - We seek the elimination of these measures prior to accession. 
- We seek the inclusion in the draft Report of text on the basis for Members concerns 
with these measures. 
- We seek the inclusion in the draft Report  of appropriate commitment language that 
Russia will eliminate all such measures by the date of accession and not have recourse to them after accession. 
 
At paragraph 13, it is disclosed that there is a mandatory requirement a pplicable to exporters 
of products from Russia to convert 50 per cen t of their foreign exchange earnings into 
domestic currency.  We welcome this disclosur e, even though we are disappointed by the 
measure. WT/ACC/SPEC/RUS/25/Add.1 
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 The mandatory requirement applicable to exporte rs of products from Russia to convert 50 per 
cent of their foreign exchange earnings into domestic currency is inconsistent with the 
requirement under GATT Article XI to eliminat e unjustifiable restrictions on exportation. 
Insofar as this requirement impedes the use of  foreign exchange earnings for subsequent 
importation, it is inconsistent with the non- discrimination provisions of GATT Article III and 
the requirement under GATT Article XI and Ar ticle 4 of the Agriculture Agreement to 
eliminate unjustifiable restrictions on importation. - We seek the elimination of this requirement prior to accession. 
- We seek the inclusion in the draft Report of the basis for Members concerns with this 
measure. 
- We seek the inclusion in the draft Report  of appropriate commitment language that 
Russia will eliminate all such measures by the date of accession and not have recourse to them after accession. 
At paragraph 13, it is disclosed that residents ar e required to deposit, in domestic currency in 
an authorised bank, an amount equal in va lue to the foreign currency purchased for the 
purpose of prepayment for purchase of imports.  We welcome this disclosure, even though we 
are disappointed by the measure.  The requirement to deposit, in domestic currency in an authorised bank, an amount equal in 
value to the foreign currenc y purchased for the purpose of  prepayment for purchase of 
imports, is inconsistent with  the non-discrimination provisions of GATT Article III and the 
requirement under GATT Article XI and Article 4 of the Agriculture Agreement to eliminate 
unjustifiable restrictions on importation. - We seek the elimination of this requirement prior to accession. 
- We seek the inclusion in the draft Report of the basis for Members concerns with this 
measure. 
- We seek the inclusion in the draft Report  of appropriate commitment language that 
Russia will eliminate all such measures by the date of accession and not have recourse to them after accession. 
 At paragraph 13, it is stated there are no restri ctions on residents to buy foreign currencies on 
the domestic exchange market to meet their payments on current transactions. 
 
- We consider that any such restrictions ought not to exist and, even though this 
statement appears to be contradicted by tw o of the three measures mentioned in this 
paragraph (and possibly all three measur es), we would nonetheless welcome Russia’s 
positive confirmation that such restrictions do not exist if this is true. 
 
The statement at paragraph 13, that there are no restrictions on residents to buy foreign currencies on the domestic exchange market to  meet their payments on current transactions, 
requires appropriate clarification in the draft Report.  Does this mean: - that the tax of 1 per cent on purchases of fo reign currency in cash for payments made 
90 days prior to importation, and any other restrictions on foreign currency purchases 
to pay for imports of goods or services, ar e not applicable to purchases by residents? 
- that the tax of 1 per cent on purchases of fo reign currency in cash for payments made 
90 days prior to importation, and any other restrictions on foreign currency purchases 
to pay for imports of goods or services, are applicable only to purchases by non-residents? 
- What is the criterion of residency that is applied? 
- What is the rationale and WTO justification for excluding non-residents from 
purchases of foreign currencies on the domestic exchange market to meet their payments on current transactions, when residents are not excluded?  WT/ACC/SPEC/RUS/25/Add.1 
 Page 5 
 
 
 - Is it actually the case that non-residents holding Russian currency may be impeded 
from engaging in the importation of goods or  services into Russia on account of being 
forbidden under Russian law to exchange Russian currency for foreign currency on 
the domestic exchange market? 
 
11. 14  At paragraph 14, it is acknowledged that  Members sought information on a number 
of concerns arising out of measures applied by Russia.  We welcome this acknowledgement 
of Members’ requests, in particular the u se by Russia of methods other than exchange 
restrictions which adversely affect current transactions to avoid capital flight and the 
provision by Russia of information on the legi slative basis for authorising exchange and 
payments restrictions and requirements. 
Russia has failed to address anywhere in the Re port the substance of a number of Members’ 
requests at paragraph 14, in particular the re quest for Russia to provide information on the 
legislative basis for authorising exchange a nd payments restrictions and requirements. 
We ask that the substance of Members’ request s be addressed in the draft Report, including 
the provision of information on the legislative basis for authorising exchange and payments 
restrictions and requirements. 
 12. 15 At paragraph 15, it is acknowledged that m easures relating to monetary policy, and 
foreign exchange and payments are coordinated with the IMF. 
- We ask Russia to provide a detailed explan ation in the draft Report of how, through 
its WTO accession commitments, its discriminatory and trade-restrictive measures 
relating to foreign exchange and payments  coordinated with the IMF, including all 
such measures described in the section of  the Report on Foreign Exchange and 
Payments System, will be made to reflect certain key principles of the WTO Ministerial Declaration of 15 December 1993 on the Contribution of the World Trade 
Organization to Achieving Greater Cohere nce in Global Economic Policymaking, in 
particular: - the liberalisation of trade and expansion of market access 
- conduct of trade policy in a transparent manner 
- creation of an open trade environment. 
 
 16: Please list the measures “designed to combat illegal transfer of capital and to maintain 
the integrity of the financial system...” so th at we may know which of these measures is being 
defended in the paragraph.   
  Notwithstanding the description in this text, foreign companies invested in Russia often 
complain that the regulations for capital transactions from the Central Bank are not clear or 
not workable in practice.   The Central Bank permit process remains burdensome.  Criteria for 
granting licenses are not clear and subject to bureaucratic discretion due to vaguely worded regulations.  In addition, the ab ility of foreigners to buy local government debt was limited.   
  We would appreciate information on what Russia is doing to address these issues.  In addition 
we understand that recent statements by Russi a’s new Central Bank chairman indicate that 
there are plans to gradually eliminate all curre ncy controls.  We would appreciate a statement 
for the WP report confirming Russia’s plans to do this, and within what timeframe. 
 13. 16  At paragraph 16, it is claimed that Ru ssia’s policies of currency regulation and 
control: 
- were non-discriminatory 
- did not constitute restrictions of trade in goods and services. 
The experiences of the exporters of this Me mber and relevant trade data following the 
introduction by Russia of measures described in the section of the draft Report on Foreign WT/ACC/SPEC/RUS/25/Add.1 
Page 6  
 
 Exchange and Payments System contradict cl aims that such measures are non-discriminatory 
and do not restrict trade.  This Member also considers any claim that restrictions on acquiring or using the financial means for purchasing im ports and on determining the form in which 
exporters retain their export earnings do not restri ct, divert or distort trade, to be totally 
without merit.  We ask that the views of this Member in response to the claim at paragraph 16 
be recorded in the draft Report. 
 14. 17 At paragraph 17, certain provisions and changes to measures relating to foreign 
exchange and payments are described.  We we lcome any liberalisation that may have taken 
place.  In addition to the changes to measur es described at paragraph 17, we seek the 
inclusion in the draft Report of a detailed d escription of Russia’s plans to eliminate by the 
date of accession all of the measures described in the section on Foreign Exchange and Payments System that any Member may have identified during the course of the negotiations 
as restricting trade or as discriminating against the products of particular Members. 
 
15. 17: What does “prolonging delays” mean in this context?   
 
In addition, the text indicates that export surre nder requirements have b een selectively relaxed 
for “some exported machinery and equipment and up to five years for payments related to construction and sub-contracting works carried out abroad as well as for payments connected 
with insurance and reinsurance of these pr ojects.”  Why have the export surrender 
requirements been differentiated in this manner? 
 We understand that transfers in foreign currenc ies by residents and purchases of other foreign 
assets by residents are subject to annual limitations of $75,000.  Please address the reasons and plans for these restrictions. 
 
Notwithstanding the assertions in the text, the rest rictions on foreign ex change retention, on 
foreign exchange acquisition or retention for pa yments, on the right of residents to acquire 
and hold foreign exchange, pre-payment require ments for imports, deadlines for shipment of 
goods, and the acquisition charge of 1 percent ha ve a demonstrated or potential negative trade 
impact, and constitute a non-tariff barrier to  imports that undermines market access.  
Particularly in light of its favorable balance of payments position, Russian should confirm its 
plans for eliminating the use of th ese measures upon accession, if not earlier. 
 16. 18 We do not agree that S accounts are of “minor economic significance.”  We wish to 
underscore the importance of liberalizing S acc ounts, which currently amount to $3.2 billion, 
and we understand that it is the intent of th e Central Bank to liberalize these accounts by the 
end of 2002.  We also note with concern current customs rules regarding currency 
declarations by residents and non-residents wh en entering or exiting the Russian Federation, 
as these rules are restrictive and burdens ome, and the penalties are harsh.  
 
Please indicate, as requested in para 18,  how and when Russia intends to remove the 
requirements.   
 
We understand that recent statements by Russi a’s new Central Bank chairman indicate that 
there are plans to gradually eliminate all curre ncy controls.  We would appreciate a statement 
for the WP report confirming Russia’s plans to do this, and within what timeframe. 
 
17. 18 We agree with paragraph 18.  We ask Ru ssia to respond to Members’ requests for 
information on the elimination of all remaini ng exchange restrictions and multiple currency 
practices. 
  WT/ACC/SPEC/RUS/25/Add.1 
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 - Investment Regime (paras 19-21) 
18. This section should be amplified. Russia s hould inform the WP of the evolution of the regime 
concerning Production Sharing Agreements and on ch anges in sectoral in vestment regimes (eg 
for the alcoholic drinks, aircraft and vehicles industries), as well as other relevant developments 
affecting the investment regime (eg im plementation of the new Land Code). 
 
19. 19-21 This member  supports Russia's initiatives to  attract Foreign Direct Investment.  
Foreign Direct Investment into the Russian Economy would be most effectively encouraged 
by providing investors and their investments a st able, predictable and transparent investment 
climate through improvement of its domestic la ws, policies and institutions and its bilateral 
investment relations with trading partners.  We support the call in P.21 for a descriptive 
summary of provisions to protect investors, incl uding those legislative provisions that exist or 
are proposed to protect foreign investors in Russia from arbitrary or discriminatory expropriations or to compensate investors for expropriations.  
 
20. 19-20  These paragraphs, while incorporating usef ul background, do not deal adequately 
with (a) restrictions in place on investment; (b) the concerns raised by delegations concerning 
Russia’s investment policies, or (c) proposal s for future restrictions currently under 
consideration.   
 
In particular, we understand that key implemen ting provisions of the current law are absent, 
thus limiting Russia’s ability to provide national treatment to foreign investors.  The resulting 
inconsistent implementation of existing laws has created barriers to investment.  Other 
chronic problems for foreign investors in Russi a include frequent changes to the regulatory 
and tax regime without transparency, weak co rporate governance and shareholders rights, and 
weak contract law.  These issues may need to be addressed by legislation, and we would like 
to have Russia’s views on them, and see these views reflected in the text. 
 21. 21  Please provide, as requested in this paragr aph, information on how and when Russia 
will remove the WTO-inconsistent measures identified in this area. 
 22. 21  
- We seek the inclusion in this section of the draft Report a description of how Russia’s 
foreign investment regime works, a point  acknowledged at paragraph 21 even though 
such a description has not been provided. 
- We wholeheartedly welcome Russia’s statement at paragraph 21 that all measures not 
in conformity with the WTO TRIMS and Subsidies Agreements will be phased out 
prior to accession. 
- We seek the inclusion in this section of  the draft Report a summary of Russia’s 
legislative plans and timetables for implementation of the elimination of all measures not in conformity with the WTO TRIMS a nd Subsidies Agreements, as foreshadowed 
at paragraph 21. 
- More detailed descriptions of these pl ans and timetables, and appropriate 
commitment language, will need to be include d in other sections of the draft Report. 
- A response needs to be provided to Member s’ concerns relating to Federal Law 171-
FZ on ethyl alcohol.  
 - State Ownership and Privatization (paras 22-37, tables 1-6)  
23. 22-37 Russia’s efforts to privatize its economy fo rm an important component of a market 
based system.  The report should provide transpar ency in the conduct of privatization, as well WT/ACC/SPEC/RUS/25/Add.1 
Page 8  
 
 as in its progress.  More elaboration of the approval process by local authorities in 
privatization of facilities and enterprises engaged in trade would be beneficial  
  We welcome the information provided in the section of the draft Report on State Ownership 
and Privatisation. 
This section of the draft Report however says virtually nothing about Russia’s reasons for 
engaging in the privatisation process and th e expected benefits, which are surprising 
omissions given that the end-point of tran sition to market economy will presumably be a 
market economy.   
- We ask that Russia use this section of the draft Report to chart (and advertise) its 
movement away from non-market economy status. 
- We request that paragraph 23 be expanded to include a summary of Russia’s policy. 
 24. 29   Please clarify what state-owned sectors are excluded from foreign participation in 
privatization.  
 
- Concerning approval of foreign participation by local authorities, what are “public 
catering and consumer services?”  Does the reference to “trade” mean all retail outlets, or is it some other type of firm/e nterprise?  How is authorization provided?  
 25. 33  Please clarify whether the firms in this paragraph are all of the remaining state-owned 
enterprises or just those whose privatization is  possible or pending.  What part of these 
enterprises, if any, are still slated for privatization?   
 
- In addition, please explain the meaning of “unitary” enterprises and distinguish these 
from the commercial companies with stat e federal participation.  Please supply 
information on what type of enterprises these are.  
 26. 35 We note that of the 3,524 commercial ente rprises referred to in para 33, only about 
one-sixth are majority state owned.  Yet para 35 states that “Wholly or majority state owned 
enterprises were responsible for 14 percent of the total production of goods and services.”  As 
close to 3000 of the commercial firms remaining unprivatized are not “majority” state-owned, 
this statistic is somewhat misleading.   
   
- Please clearly identify which types of firm s are included in the 14 percent.  For 
example, are Gasprom , UES, or Alrosa?  Are “unitary enterprises” included in this 
total?  What would the percentage be if all firms with state owned shares, e.g. all 3,524 or those with “golden shar e or larger” were included?  
 
- In addition, somewhere in the text should be an approximation of the number and 
type of state owned firms remaining that are slated for eventual privatization. 
 27. Table 1   We thank Russia for the information supplie d in Table 1, Progress in Privatisation of 
State Enterprises, under paragraph 31 of the Report. 
 We request that Table 1 be augmented (or a new table be included in the Report) to show over 
the same run of years the number of remaining state-owned and municipal enterprises, broken down into the categories of municipal, Russi an Federation subjects and Federal property. 
 28. Tables 2-5 We thank Russia for the information supplied in Tables 2, 3, 4, 5: 
- We request that a third column be added to Table 2 showing the number of state-
owned and municipal enterprises remaining in each sector.  WT/ACC/SPEC/RUS/25/Add.1 
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 - We request that the coverage of “Industry ” and “Agriculture” be clarified in a note 
under Table 2.  This note should provide information indicating whether mining is 
included in “Industry”, whether fishing and forestry are included in “Agriculture”, 
and whether “Other areas are the economy” are other services or inclusive of non-service sector activities such as mining, fishing and forestry. 
We note that the same coverage issues in rela tion to mining, fishing and forestry arising in 
Tables 1 and 2 also arise in Tables 4 and 5 under paragraph 35
. 
- We request that separate percentages be pr ovided for mining, fishing and forestry in 
Tables 4 and 5. 
 
29. Tables 4, 5, and 6     Please clarify if all state-owned enterprises included in the statistics, or 
only   those that are majority owned.  For example, are Gasprom , UES, or Alrosa?  Are 
“unitary enterprises” included in this total?   
 30. Table 6  Please clarify the coverage of the term “state owned enterprises.”  Does it 
include  agricultural production facilities owned by  state owned firms, e.g., Gasprom, Lukoil, 
or Interros?  What portion of meat (poultry, beef, and pork) is produced and/or processed by state-owned, or partially owned, enterprises? 
 
31. Table 6  We thank Russia for the information supplied in Table 6, Most Important 
Types of Agricultural Products Produced by State-Owned Enterprises in Specific Areas in 
2000, under paragraph 35 of the Report. 
The title of Table 6 is ambiguous, and would mo re appropriately read, “Shares of State-
Owned Enterprises in the Production of Most Important Agricultural Products in 2000”. 
- We request that such a title appropriate to  the contents of the table be provided. 
- We request that the basis for ranking the ag ricultural products included in Table 6 be 
clarified in a note under the table. 
- We request that the number of  agricultural products in Table 6 be increased to include 
meat and wool. 
 32. 37    We noted that according to para 37 draft commitment the Russian Federation would 
provide annual reports on the issues related to  economic reforms while still in the process of 
reforming its economy.  This member would lik e to see a concrete timeline included in the 
draft report, as it would provide more predictab ility of this commitment. This member asks 
for further information, whether the new Cust oms Code would eliminate the possibilities to 
reduce the fees for customs services? If this not the case, then we expect the Russian 
Federation to bring some clarification to the rationale for such exceptions. Namely, who can 
benefit from the reduction and what are the grounds when taking such a decision? 
 
- Pricing Policies (paras 38-51, tables 7-9) 
 
33. 38-51 This members requests detailed information w ith respect to pricing differences in the 
areas of railway transportation, gas, electric ity and oil. Subsidized inputs into fertilizer 
production is a particular problem requiring further elaboration in para 46.   The first sentence 
of P.45 on  contract prices raises the question of how these are arrived at based on market conditions if such prices are controlled.  The concept of “natural monopoly” as understood by 
the Russian federation needs to be fully articul ated.  This member  considers this section 
needs greater clarity.  
 
 In previous submissions, this member sought info rmation that is not provided in the text of 
WT/ACC/SPEC/RUS/25.   WT/ACC/SPEC/RUS/25/Add.1 
Page 10  
 
 - Please confirm in the text that the lists of  goods and services subject to price controls 
in Tables 7 and 8 are comprehensive.  Please give the effective dates of the information in the tables. 
 34. 40 and Table 7    On previous occasions, we have noted that Russia’s use of the terms 
"electric” and “electronic”  communication services to mean telecommunications is confusing 
and we have not received a direct reply to our request for clarification. 
 
- If, as it seems, it is Russia’s contention in para 40 that all telecommunications 
services, including value-added networks and cellular services, are part of a "natural 
monopoly,” we must take issue with this assertion.  There is widespread private 
sector provision of both basic and value- added network  services in many other 
countries 
- Are gas liquids and condensate, e.g., like those used for petrochemical feedstocks” 
included in the prices controls?” 
 
35. 44 and Table 8     Please give the legal citations for Fe deral regulation of th e authority of sub-
central entities to apply price controls.   
 
- Could Russia provide an example of how regional regulation of natural monopoly 
pricing works in practice? 
- It is noted that“prices for electrical ener gy provided by regional electrical power-
plants were also regulated” at the regiona l government level.  Does this include 
power to firms as well as to homes? 
- To what extent are prices determined by  bilateral agreements between electric 
companies and regional governments? 
 
36. 45  This paragraph refers to “contract pr ices” for goods and services delivered within 
Russia as being “subject to market conditions.”  We  seek clarification of what this means, in 
light of the fact that the prices at which the sale is made are controlled by the state.   
 37. 45 This paragraph should include a clearer a nd more comprehensive explanation of the 
operation of the regimes governi ng state regulation of prices, both for domestic and export 
markets.  Given the regulatory stru cture described elsewhere in this section, it is difficult to see 
how the statements that contra ct prices for goods and servi ces are fixed by enterprises 
independently or depending on market conditions ca n be substantiated.  We  would invite Russia 
to submit additional information to explain this. 
 
38. 46  Table 7  lists energy prices (natural gas, electricity) as commodities under federal 
price control.  Such controls applied to fe deral and regional “natural monopolies” can affect 
the competitiveness of domestic produ ction and may act as subsidies.   
 
- Please expand the description in this paragraph of the Federal Energy Commission’s 
pricing of energy sales to domestic industries, such as fertilizer, aluminum, and other 
energy-intensive, export-oriented industries, relative (a) to world prices and (b) to the prices charged to other sectors of the econom y, including households.  Please indicate 
the reasons for this pricing structure. 
- Please explain whether gas distribution cost s are fully reflected in all gas prices 
charged throughout Russia. 
- Please outline the role of the Unified Tariff Au thority in energy (e.g., natural gas and 
electricity) pricing, and its relationship to the Federal Energy Commission.   
- Please identify and describe any Orders or other legislation (e.g., like the cancelled 
Order No. 12/1 of the Federal Energy Commission of March 24, 1999 on Granting a  WT/ACC/SPEC/RUS/25/Add.1 
 Page 11 
 
 
 50 Percent Reduction of Prices of Gas to Enterprises Which Produce Chemical 
Fertilizers, Chemical Protections for Plants, and Raw Materials for Production Thereof, in 1999" (as amended on June 4, 1999)) that provide for price reductions for 
inputs to the fertilizer or other industries.    
- Please provide a citation in the text of the legal instrument repealing FEC Order 
12/1of March 24, 1999.  We have b een advised by our domestic industry 
representatives that this Order remains in effect. 
 39. 48  We understand that the 1 March 2002 deadlin e for eliminating discriminatory pricing 
for railway freight transportation was missed.  Ru ssia should confirm its revised timetable for 
this measure. 
 
40. 48 Referring to the para 48 on the discriminat ory pricing policies on railway freight we 
note that this practice was not brought into co mpliance with the WTO rules as of 1 March 202 
as indicated earlier by the Russian authorities.  We therefore continue to have serious 
concerns over this issue and expect further clarifications from Russia. 
 
41. 48, 49 and 50  Paragraphs 48 and 49 incl ude Members’ concerns relating to dual pricing for 
transportation and energy. - These issues will need to be addressed, and we  ask that responses be provided to the 
concerns raised by Members in these paragraphs. 
- We agree with paragraph 50, subject to the rectification of a number of typographical 
errors.  We ask that the typographical errors be rectified. 
The provisions of GATT Article III to which a direct  reference is made in paragraph 50 of the 
Report are found under paragraph 9 of GATT Article  III, not paragraph 5 of that Article. 
- We ask that this reference be rectified. 
 
42. 49: The paragraph should include illustrations of the extent of dual pricing.  The 
following text should be added after the third sentence: 
“For example, the price of natural gas to domestic industry was around $15 per 1000 cubic metres, compared to an average export price at Russia’s western borders in 
2001 of $116 per 1000 cubic metres.  Even in the oil market, which was more 
deregulated, the price of crude oil on th e domestic spot market was around $5 per 
barrel in January-March 2002 when the prevailing world price was around $20.  These price comparisons were independent of any price variations resulting from differences in internal taxation rates.  Th e negative effects of the price differential 
were also potentially amplified by other factors such as non-payment by domestic 
consumers.” 
It should also be noted that some members do not expect the process of regulatory reform in 
the energy sector in Russia to be completed overn ight, contrary to the impression given in the 
paragraph.  The last three sentences of the paragraph should refer to the views of “these 
members” rather than “this member”. 
 
43. 49          Russia’s statement in this section of the draft Report does not address the concerns 
raised by members at the previous two Workin g Parties regarding potential trade distortions 
caused by the subsidization of downstream indus tries provided through the gas, electricity, 
and oil sectors.   - We are concerned over the impact on trade of Russia’s price controls on energy 
products, in particular natural gas and electri city, supplied to enterprises.  We believe 
these controls hold prices below the level they would rise to if the controls were eliminated. WT/ACC/SPEC/RUS/25/Add.1 
Page 12  
 
 - We have noted on several occasions, that Ru ssia’s price controls on natural gas used 
in the production of nitrogen fertilizers ha ve promoted exports in volumes and at 
values that are causing severe disruption in  markets receiving Russia’s exports.   
- We would like to see these views reflected in the draft Working Party report.   
- This issue will need further attenti on and action as the Working Party process 
evolves. 
 44. 51 This member considers that the inclusi on of commitment language on the issue of 
dual pricing, additional to that already found in  this paragraph, will be called for in future 
versions of the report. 
 
45. Tables 7, 8 and 9  We thank Russia for the information set out in the lists of goods and 
services for internal consumption for which prices are regulated by the federal government and federal executive bodies (Table 7), by the federal government and sub-federal executive 
bodies (Table 8), and by sub-federal executive bodies in respect of regional regulations over 
prices and mark-ups (Table 9). 
- We request that Tables 7, 8 and 9 be augmente d to provide full details of the type of 
price regulation used in relation to each good or service (e.g., price cap, price floor, 
profitability control, price stabilisation measure), and of the legal instruments 
governing their use. 
If the price regulations relating to HS headi ngs 7101-7103 cover all pr oducts falling to these 
headings, then the product description will need  to include pearls, as well as diamonds and 
precious stones. - We ask that this be done. 
We note that precious metals are not included in Tables 7 and 8. - Is it the case that the prices of precious meta ls for sale in Russia are not regulated?   
We seek clarification of this point. 
- We request that a table be included in the draft Report setting out information on 
goods for internal consumption for whic h prices are regulated by sub-federal 
executive bodies in respect of regional legal instruments. 
- We request that tables be included in the draft Report providing details of all 
regulations maintained by any federal or sub-federal body on prices of goods and 
services for external sale or consumption. 
- We request that all legal instruments gove rning the use of controls on the prices of 
goods and services for internal consumption or external sale or consumption be 
submitted by Russia for examination in the Working Party. 
 - Competition Policy (paras 52-58) 
46. 57  The Ministry of Antimonopoly Policy (MAP) regulates the securities market and 
banking and services markets subject to the Law “On Protection of Competition in the 
Financial Services Market” in conjuncti on with other federal authorities.   
- Please provide more information, for inclusion in the WP report text, on the actual 
implementation and enforcement of this law.  WT/ACC/SPEC/RUS/25/Add.1 
 Page 13 
 
 
  
FRAMEWORK FOR MAKING AND ENFORCING POLICIES Powers of executive, legislative and judicial branches of governments - Branches of State Power, Federal Structure and Delimitation of Jurisdiction between 
Federal and sub-Federal Authorities  (paras 59-79) 
47. 59-79 This member would wish this section to be carefully scrutinized by experts in 
Russia’s constitution so as to ensure an accurate  description of the hierarchy and order of 
precedence of the various levels of laws.  Ph rases like “should be applied” in P.66 raises 
questions of  precedence which need to be clarified. 
 
48. 60, 66, 68         All three paragraphs make refe rence to Federal legislative supremacy over  
“subjects” of the RF.   We seek consolidation of these references with further clarification and 
description on the authority for this, e.g., what Ar ticle of the Constitution, what other laws?   
In para 66, please clarify whether, in cases of conflict with regional law that federal law “should” or “shall” be applied. 
 
49. 63  How does the court system exercise the ri ght of legislative initiative, i.e., through 
what instruments? 
 50. 64  Are State Fees ever charged for appeals covered by WTO?   
- Concerning the right of administrative and judicial appeal on matters covered by the 
WTO, please cite the legal authority for administrative appeals on WTO matters and 
the right of appeal to a court. 
- Please indicate specifically which courts, e.g., arbitration courts or commercial 
courts, are involved in reviewing WTO issues, including customs and licensing issues, SPS and TBT requirements applied to imports, and intellectual property 
issues. 
 51. 65  Please describe for the WP text the hierarch y of legislative acts in Russia, i.e., the 
relationship and role of Codes, Laws, Gove rnmental Resolutions, Presidential Decrees, 
Decisions, Orders, and Letters, as other form s of legislation that implement WTO. 
- In addition, please indicate where prior publication of enacted laws for public 
comment is provided for in Russian law. 
 52. 70  Can the legal primacy of international treaties over domestic law can be enforced 
without the need for complainants to seek a judgement of a court? 
 
53. 70  As it is stated in the paragraph 70 of the draft Report:  "the norms of international law 
and international treaties to which the Russian Federation is party are constituent part of its 
legal system".  We do welcome this statement.  However, we should say that we need not only the recognition of this fact, but also the commitment to be taken by the Russian 
Federation, with reflection in the draft Report, that it will strictly observe the principles of 
international law and international treaties.  Th is is mainly caused by the fact that we are 
witnessing numerous violations of commitment s undertaken by the Russian Federation under 
bilateral and multilateral arrangements a ffecting trade in goods and services. 
 54. 71          Please identify the WTO-relevant aspects of the draft Law on the Regulation of 
Foreign Trade, slated for enactment this year, as well as provisions of the new Customs Code WT/ACC/SPEC/RUS/25/Add.1 
Page 14  
 
 that address the issues in this section, e.g., tr ansparency, publication for prior comment, right 
of appeal. 
 
55. 72  The paragraph 72 states that the federal s ubjects of the Russian Federation have the 
right to negotiate and conclude  Agreements with their partne rs on international and foreign 
economic ties.  Besides the phrase "such agreements  could not contradict federal legislation" 
the second sentence of paragraph 72, we would insist on insertion of the phrase which would 
explicitly state that:  "such Agreements that should fully respect the national legislation of 
partners' countries should not harm  the economic interests of these countries".  We would also 
wish to insert in the last sentence of paragr aph 72 the phrase, which would specify that the 
subjects of the Russian Federation do not represent the subjects of international law. 
 
Georgia feels that the main provisions of the Fe deral Law to which the reference is made in 
paragraph 72 are being constantly violated by the subjects of the Russian Federation.  In this respect we would like to note that there is a huge difference between existing reality and 
conditions stated in the paragraph 72.  That is why we need explanations from the Russian 
Federation how it intends to ensure full observance of this law by its subjects.  We also seek 
commitment from the Russian Federation that its federal or sub-federal entities will act strictly in conformity with the above-mentione d law fully respecting national legislation and 
interests of partners' countries. 
 
56. 73  In what way do the Russian Federation and its subjects (sub-central entities) have 
“joint jurisdiction” over “the fulfilment of th e Russian Federation’s international treaties? 
- In addition, please clarify what is meant by  the sentence “the Law established that 
federal bodies of executive power should send the main provisions or the draft of a 
prospective treaty to the state power bodies of the interested subject of the 
Federation.”  Does it mean that the Federa l Government will be required to submit 
the protocol package to sub-central entities for approval in the ratification process, or 
is this more a form of consultation? 
- Please indicate how the consultation mechan ism for international agreements works 
with the regions, and would work in the case of adoption of the WTO accession 
package. 
 
57. 76  Please clarify if the description in this paragraph is intended to state that there are 
some issues covered by WTO that are not appealab le to an independent tribunal.  In addition, 
Please indicate where in the Tax Code and th e Customs Code there are procedures outlined 
for administrative appeal. 
 
58. 77   This paragraph should reflect the concerns raised by this member in relation to the 
“right to appeal”.  An additional paragr aph should be included in which Russia should 
provide the full description requested by Members (eg concerning the appropriate appeals/judicial process and procedures in an y given situation where WTO-inconsistencies 
might arise). 
 
59. 77  We seek more information on the Duma Experts Committee with a short description 
of the Committee’s mandate and status of curre nt work, the work of this Committee in the 
accession process and, as relevant, the role this  Committee will continue to play in Russian 
legislative developments after accession.  In this regard, please include information on plans 
for a Duma Commission to replace the Experts Committee, and on the role the Commission is 
intended to play in ensuring WTO-c onsistency of Russian legislation. 
 
60. 78  We seek explanations what is meant by  the phrase:  "other territories under the 
Russian Federation's control".  We propose either  to simply delete it from the draft Report or  WT/ACC/SPEC/RUS/25/Add.1 
 Page 15 
 
 
 if there is a necessity to retain such wording in  the draft Report, just to add after the word 
"control" the words – "within its state border". 
 
61. 79  This member considers that appropria te commitment language would include a 
commitment as to the right to appeal administrative rulings on matters subject to WTO 
provisions to an independent tribunal or other independent body. 
 
POLICIES AFFECTING TRADE IN GOODS 
 Trading Rights (the right to import and export)  (pages 80-93 and Table 10) 
62. 80-93 This member wishes to have more in formation regarding “activity licensing” 
requirements relative to pharmaceuticals, alcohol  and precious stones and supports the call for 
a clear understanding about how they work.  We look forward to an explanation of the steps being taken to bring these practices into  consistency with GATT requirements.  
 
 The drafting of this section is clearly at an early stage.  A useful feature of the text is it makes 
clear that the veracity of Russia’s claims to WT O conformity will depend in part on whether 
or not all substantive and procedural aspect s of “registration requirements” or “activity 
licensing”, which determines the registered scope of business, are in conformity with WTO rules.  The clarity provided on the need for further clarification provides a starting point for the detailed examination that now needs to take place. 
 
We are pleased that this discussion may now pr oceed on the understanding that the evaluation 
of any such activity licensing against WTO provisi ons will be integral to deciding whether or 
not the WTO’s guarantees on the right to trade under GATT Articles III:4 and XI:1 are satisfied, and to clarifying reforms in this area required for accession. 
 
 Russia should update information relating to the current regulatory regimes and proposed 
initiatives to eliminate WTO-inconsistencies rela ting to the ability to trade in individual 
products such as alcoholic drinks, pharmaceutical s, precious metals and stones, including by 
reference to specific legislative measures. 
 
63. 81  Please elaborate on the statement on the elimination of the State monopoly in foreign 
trade in light of  State restrictions on who may trade in natural gas, electricity, alcoholic beverages, precious stones and me tals, and pharmaceuticals, and any planned restrictions of 
this sort in other sectors.  Reference should al so be made to the trading activities of the State-
trading enterprises identified later in the Report. 
- We understand that Russian agencies, e.g., th e Ministry of Agriculture and the State 
Customs Committee, have made efforts to limit the number of both importing and exporting firms conducting international tr ade in certain products.  We would 
appreciate an explanation for why these efforts are being made and the legal basis upon which such approaches are made, for both domestic and foreign trading firms. 
 
64. 84  Please list the forms of commercial associa tion that can be registered, and provide 
citations for the laws that establish their le gal status, including sole proprietorships and 
branches of firms. 
 65. Para  84 The Federal law No 129-FZ of 8 August 2001 "On state registration of juridical 
persons" which will enter into force from 1 July 2 002 is not mentioned in Annex 1. As this is 
an important law This member  requires the tran smission of a translation of this law to the 
Working Party. 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 16  
 
 66. 85-86  We would appreciate receiving more inform ation on the criteria and fees applied to 
receive activity licenses for importation or e xportation of alcoholic beverages, precious 
metals, or pharmaceuticals, with emphasis on identified WTO-inconsistencies in the 
availability, fee structure, and procedures, and on Russia’s plans to address these deficiencies.  
- Please indicate the relationship of these laws and decrees to the new Activity 
Licensing Law. 
 67. 86, 90-91, 92-93  Members have expressed several c oncerns about the three exceptions 
regarding the right to undertake foreign trade activity (alcoholic beverages, precious metals 
and stones, and pharmaceutical products). As Federal Law FZ-86 of 22 June 1998 on 
Medicines states that the right to export a nd import pharmaceuticals is enjoyed by Russian 
participants, we first request that a translati on of the said law be transmitted to the Working 
Party. A more precise answer from the Russian Federation is needed on these three issues and 
paragraphs 92 and 93 should be further elabor ated to address the concerns expressed by the 
Members. 
 
68. 88-91 Members have raised a number of legitimate  concerns in paragraphs 88-91.  We ask 
that these concerns be fully addressed. - We seek the inclusion in this section of the draft Report full descriptions of the 
restrictions maintained on the right of an y natural or legal pers on to engage in the 
importation and exportation of precious st ones and precious metals, ethyl alcohol, 
pharmaceutical products and any other products .  The descriptions provided will need 
to include details of: - the nature of the restrictions; 
- the products affected by them; 
- their purpose and WTO justification; 
- the formalities, requirements and eligibilit y criteria that need to be satisfied, 
and the relevant procedures associated with their application, in order for a legal or natural person to be able to e ngage in importation or exportation of 
the product concerned, including those relating to obtaining activity licenses; 
- their legal basis, including in the area of activity licensing. 
We note that in paragraphs 85 and 86 there are brief descriptions of the first and third 
exceptions, but no description of the second exception. 
- We ask that such a description be included in this section of the draft Report. 
Russia will need to make available copies of English translations of  all relevant legal 
instruments, including those related to activ ity licensing, for examination in the Working 
Party. 
- We request that English translations of all such legal instruments be provided for 
examination in the Working Party as soon as possible. 
- If English translations of these legal in struments cannot be provided before the 
meeting of the Working Party scheduled to  be held during the week, 17-21 June 
2002, we seek a positive indication of the da te by which they will be submitted. 
 
69. 89 reference should be made to the expecta tion that Russia will make a commitment to 
ensure full national treatment in respect of a ll laws, regulations and requirements concerning 
the internal sale, offering for sale, purchase, transportation, distribution or use of imported 
alcoholic beverages and ethyl alcohol. 
 
70. 89 During Russia's accession talks, Georgian delegation on several occasions expressed 
its concern over the restrictive results of the cu rrent system of licensing in Russia for the sale 
of alcoholic beverages.  Georgia feels that th ere is a significant difference between the rates 
of the fees charged by the Russian Federation for the right to import, storage and wholesale of alcoholic beverages and those charged for domes tic distribution or export, which represents  WT/ACC/SPEC/RUS/25/Add.1 
 Page 17 
 
 
 the violation of paragraph 1 of Article III of th e GATT.  In this respect we urge the Russian 
Federation to make the appropriate adjustments in  its legislation in order to comply with the 
WTO relevant provisions and to insert the rele vant commitment language in the draft Report. 
 71. 90 this paragraph should include a fuller descrip tion of the concerns earlier expressed in 
relation to the regimes applicable to trade in  alcohol, pharmaceuticals, precious metals and 
stones.  This member expects Russia to unde rtake the following commitm ents in respect of 
trading rights: 
 
“Russia will guarantee that no restrictions ar e placed on the right to trade in goods and 
services except as would be consistent with WT O provisions and that a ll laws and regulations 
relating to trading rights will be applied in  a manner consistent with relevant WTO 
obligations.  Specifically, Russia confirms that no restrictions will be placed on the right of 
individuals and enterprises, including those with  foreign participation, to import and export 
goods into Russia’s customs territory, except as would be consistent with provisions of the 
WTO Agreements.  Nor will individuals and firms be restricted in their ability to import or 
export based on their registered scope of business.  The criteria for registration and enrolment in the State Register of legal persons will be  generally applicable and published, along with 
any future changes to them. 
 
Without prejudice to other relevant provisions of  the WTO, Russia will ensure that any laws 
and regulations relating to the right to trade in goods will not restrict imports of goods in 
violation of the general prohibition on quantita tive restrictions contained in GATT Article 
XI:1, nor should they discriminate agai nst imported goods in violation of the 
non-discrimination provisions of GATT Article III: 4.  Any associated fees, taxes and charges 
will also be limited to the approximate cost of  services rendered and their application will not 
lead to discrimination in fa vour of like domestic products. 
 
Russia will ensure full national treatment in resp ect of all laws, regula tions and requirements 
concerning the internal sale, offering for sale, purchase, transportation, distribution or use of imported alcoholic bevera ges and ethyl alcohol.” 
 
This language should be included in the draft report and paragraphs 92/93 amended 
accordingly. 
 72. 90  mentions Members’ concerns relating to import requirements for precious stones and 
precious metals. 
- We seek inclusion in this paragraph acknowle dgement of the fact that Members have 
concerns in relation to Russia’s export re quirements for precious stones and precious 
metals. 
- We seek inclusion in this section of the draft Report Russia’s responses to Members’ 
concerns in relation to its export requi rements for precious stones and precious 
metals. 
We note previous advice provided by Russia which seems to imply that once an activity 
license has been obtained by a legal or natu ral person to engage in the importation or 
exportation of precious stones and precious me tals, ethyl alcohol and pharmaceutical 
products, any import or export licenses that may apply to these products are issued 
automatically, in the sense of automaticity crite ria set out under Article 2 of the Agreement on 
Import Licensing Procedures, in respect of exportation as well as importation. 
- We request details of all import and e xport licensing applicable to these products, 
over and above activity licensing, including inter alia information on where and how 
the automaticity criteria set out under Artic le 2 of the Agreement on Import Licensing WT/ACC/SPEC/RUS/25/Add.1 
Page 18  
 
 Procedures are not satisfied (including in cases of export licensing) and the reasons 
why those automaticity criteria are not satisfied. 
73. 92-93 The commitment in paragraph 93 will ultimately be acceptable but Russia has not yet 
demonstrated that it can achieve WTO conformity in practice.  - Until the issues raised by Members on tradi ng rights are satisfactorily addressed and 
appropriate reforms enacted, we will not be ready to accept the claims made at 
paragraph 92, nor will we be prepared to accept that Russia will be ready to maintain 
appropriate WTO conformity as fo reshadowed at paragraph 93. 
 
Import Regulations 
- Customs Regulations and Customs Tariff (para 94) 74. In relevant with the session of Other Cust oms formalities, members would like to seek 
clarification on the Customs Order Number 25, dated 25 January 2001 and other related 
orders of the State Customs Committee of the Ru ssian Federation, which limit the numbers of 
customs land checkpoints for goods imported from 14 countries, including a number of 
ASEAN countries. It should be also mentioned that 10 out of 14 are the WTO members.  
 
- It is clear to us that this is the “systemic  issue”. The Order, naturally, is contravention 
and non-compliance with the WTO’s non-discr iminatory principle and also definitely 
constitutes a non-tariff barrier.  
- We have raised this particular issue se veral times both in bilateral and in Working 
Party. Unfortunately, we have not recei ved any response from the Russian side.  
- We need to see commitment from the Russia that this particular order and other 
related orders will be resolved and will not be reintroduced in the future.  
- Finally, these members would like to see our concern, as well as the Russian response 
to the commitment, reflecting in the Report.   
 
75. 94 pending enactment of the new Customs Code  and Chapter 27 of the Tax Code and 
their notification to the WP, it is not possibl e to assess whether the provisions of these 
measures are indeed in full conformity with  WTO requirements. Russia should supply the WP 
with updated information on these legislative initiatives, outlining the changes that are 
intended to improve the level of  WTO-consistency, and provide copies of the legislation to 
the WP in due course. 
 
76. 94  Please provide a short description of th e WTO-relevant provisions of the new 
Customs Code and Chapter 27 of Part II of  the new Tax Code, and describe how, after 
enactment, Russia plans to amend ex isting and develop new regulations. 
 
We understand that there are proposals before the Duma for revision of the Law on Customs 
Tariff.  If this is true, we would appreciate receiving information on how this relates to the 
new Customs Code and Chapter 27 of Part II of the new Tax Code.  
 77. 94  provides a brief description of changes to customs regulations and the customs tariff. 
The section of the draft Report on customs regulati ons and customs tariff is very thin, but we 
are assuming that it is intended only as brief background to the following sections that deal 
with duties, quotas, fees, charges, customs fo rmalities, requirements and practices, etc., in 
more detail. - It might be useful however to include here  a description of the changes to customs 
regulations, procedures and practices pursuant to enactment of the new Customs 
Code and amendment of the Tax Code, th e reasons for their introduction, and how  WT/ACC/SPEC/RUS/25/Add.1 
 Page 19 
 
 
 they have been designed to address concerns  raised by Members in relation to the 
application of Russia’s customs regula tions.  We ask that this be done. 
- We request that Russia make available copies of English translations of all relevant 
legal instruments in this area, including a ny regulations and other legal instruments to 
implement the new or amended legislation as well as the new Customs Code and the 
Tax Code as amended, for examination in the Working Party. 
- If English translations of these legal in struments cannot be provided before the 
meeting of the Working Party scheduled to  be held during the week, 17-21 June 
2002, we seek a positive indication of the da te by which they will be submitted. 
 - Ordinary Customs duties (paras 95-100, Tables 11-12) 
78. 95-100  Substantive comments on this section will need to be deferred  until Members 
see an English translation of Chapter 27 of th e new Tax Code which, we understand, replaces 
the current Law On Customs Tariff.  
 
 Most of this section is acceptable.  We seek incl usion of a reference in this section of the draft 
Report to Russia undertaking bilateral market acc ess negotiations leading to the Schedule of 
Concessions attached to the draft protocol of accession. 
 
78. 96 and 98  This member has a question in regards to the paragraphs 96 and 98 of the 
document WT/ACC/SPEC/RUS/25.  We ask the Russian delegation to clarify whether the 
changes in the customs legislation mentioned in these paras would exclude the possibility to 
apply double MFN – tariff rates on the goods originating from a WTO member country. This member has a question in regards to th e paragraphs 96 and 98 of the document 
WT/ACC/SPEC/RUS/25.    This member raised a similar question in th e previous submission, which was based on the 
documents WT/ACC/SPEC/RUS/20/Rev.1 a nd WT/ACC/SPEC/RUS/21/Rev.1 and was 
presented for the inclusion in the first Draft Wo rking Party Report. As this question was not 
reflected in the first draft report and as we conti nue to have a concern on this particular topic 
we expect that this issue will be reflected in future drafts. We ask the Russian delegation to clarify whet her the changes in the customs legislation 
mentioned in these paragraphs would exclude the possibility to apply double MFN - tariff 
rates on the goods originating from a WTO member country, i.e. whether these new 
legislative acts would bring the Russian practic es in compliance with the Article I of GATT 
1994?  
 79. 97 says: A new commodity description and classification system entered into force on 
1 January 2002 based on HS 2002. Please provide  your new customs tariff based on HS 2002 
to the WP. 
 80. 98  Please provide a list of Russia’s non-MFN trading partners and GSP recipients. 
 
81. 100 Russia needs to respond to the questions raised by Members in paragraph 100.  We 
ask responses to these questions be includ ed in this section of the draft Report. 
 
82. 100  After 100 a new paragraph containing the answer of the Russian Federation and its 
commitments should be added  
 - Tariff Quotas, Tariff Exemptions (paras 101-105) 
83. 101-105 The report should note that several members expressed preference that Russia 
not use TRQs, particularly where they do not currently exist.  It should also note that some WT/ACC/SPEC/RUS/25/Add.1 
Page 20  
 
 members considered that the introduction of TR Qs would be a step backward from the trade 
liberalization that is expected from accession to the WTO.  The view should be reflected that 
if TRQs were to be introduced, they must ensure  that existing levels of trade are preserved, 
provide for annual growth, and are time limited.  Transparency in allocation would also be 
essential.  
 
 The text of this section of the draft Report should reflect the views of Members on the issue 
of establishing TRQs, in particular, Members’  opposition to the imposition of TRQs to limit 
imports into Russia in areas currently subject to tariff-only regulation., and that they do not 
consider this issue to be resolved.  
 
 We are opposed to Russia’s proposals to intr oduce tariff quotas to restrict market access.  
Whether and how tariff quotas might be applied is  subject to bilateral negotiation at present, 
and we reserve the right to return to the issues ra ised in this section of the draft Report later in 
the negotiations in the light of ag reed terms of bilateral settlement. 
 
84. 102  The statement of Members in para 102 re jecting Russia’s contention that license or 
quota auctioning is WTO consistent or a fee for services should be expanded to include reference to the fact that any fees charged or re venues collected in this regard must not exceed 
the bound rate of duty established.  - We also seek a commitment from Russia to th is effect, i.e., that any fees charged or 
revenues collected must not exceed the bound rate of duty established. 
 85. 102  We are unable to accept Russia’s claim at paragraph 102 that the auctioning method 
of tariff quota allocation conforms with WTO re quirements, and we note that we are not the 
only Member to hold this view. 
If these claims are retained in the draft Repor t we will wish to see an additional paragraph 
included that sets out the contrary view of a num ber of Members in more detail than is current 
contained in the final sentence of para 102. 
 86. 102  Could the RF inform about the fees paid for the auctions of the raw sugar auctions of the 
GSP TRQ (Gov. Res. 572, 27/7/2000 and 622, 23/8/2001), as well as the fill rate. 
This member  prefers that the RF does not a pply any TRQs in this accession. If, in any case, 
this would be so, This member  maintains th at the auctioning method of TRQs is not fully 
consistent with GATT94 and discriminates ag ainst members that do not provide export 
subsidies.  
 
87. 104  We seek the inclusion in paragraph 104 of  Russia’s response to the concern raised. 
- We seek the inclusion in this section of the draft Report of the following text: 
 
“A Member noted that the Law on Customs Tariff prohibited access under tariff quotas from being accorded to the products of most-favoured-nation suppliers.  In 
response, the representative of the Russian  Federation indicated that the Russian 
Federation would repeal this Law and woul d enact amendments to the Tax Code to 
eliminate this prohibition, and that the necessary amendments to Tax Code would become effective no later than 1 January 2003.   The Working Party took note of these 
Commitments.” 
 
88. 105:  Please clarify whether the limitation noted th at only "Russian participants of foreign 
economic activities" participated in TRQ auc tions includes foreign-owned firms established 
as Russian juridical persons.  Can foreign firms and individuals not invested in Russia be the 
importer of record for goods administered by TRQs?  WT/ACC/SPEC/RUS/25/Add.1 
 Page 21 
 
 
 - Please confirm that there were no eligibilit y requirements to participate in TRQ 
auctions that would favor local production, such as requirements to enter into contracts to purchase domestic product or to provide domestic producers with inputs.  
 89. 105  The fundamental issue raised at paragr aph 105 relates to the qualifications that 
enterprises need to have in order to receive ta riff quota allocations under whatever system is 
used by Russia to allocate tariff quota. - We ask that information be provided that cl arifies the qualifications that enterprises 
need to have in order to receive tariff quot a allocations.  As part of this, we would 
also like to know whether foreign-owned firms established as Russian juridical 
persons may qualify to receive tariff quota allocations. 
- We ask that it be noted in this paragraph that the WTO conformity of the 
qualifications that enterprises need to have in order to receive tariff quota allocations 
is a separate issue from that of the WTO c onformity of the type of allocation method 
used, and that we do not consider that the auctioning method conforms with WTO 
requirements. 
 90. 105  After 105 a new paragraph containing the an swer of the Russian Federation and its 
commitments should be added.   
 
- Other Duties and Charges (paras 106-108)  
91. 106-108 This member would wish to see the elimination of all other duties and 
charges other than the customs duty and have this reflected in Russia’s tariff schedule. 
  We seek Russia’s confirmation that it will bind ODCs at zero in its Goods Market Access 
Schedule. 
 
92. 106-108  The substance of the section of the draft Report on Other Duties and Charges, 
including the proposed commitment language at para graph 108, is close to acceptable, and we 
assume that the brackets around the text of this paragraph do not indicate the existence of a dispute as to the substance of the issue. However it is not appropriate to  include textual references to fees and charges for services 
rendered in the section of the Report on Other Duties and Charges. 
We welcome that Russia does not apply any Ot her Duties and Charges (ODCs) within the 
meaning under GATT Article II:1(b), and exp ect that Russia will have no difficulty 
committing to bind ODCs at zero on all tariff positions as is required. - We accordingly request that existing text in this section of the draft Report be 
replaced with the following text which sp ecifies the factual situation and Russia’s 
commitments: 
“The representative of the Russian Federation st ated that the Russian Federation did not apply 
other duties and charges (ODCs) within the m eaning of Article II:1(b) of GATT 1994 and that 
such ODCs would not be applied after accession.  Noting these statements, a number of Members asked the Russian Federation to commit to bind at zero all such ODCs in its 
Schedule of Concessions and Commitments for Goods.  The representative of the Russian 
Federation replied that the Russian Federation so agreed.  The Working Party took note of 
these Commitments.”  
 93. 108   please confirm the commitment mentioned in § 108 in order to remove the square 
brackets. = bind other duties and charges at zero. 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 22  
 
 Fees and Charges for Services Rendered (paras 109-115 and Tables 13-14) 
94. 109-115 This member expects Russia to meet  the obligations of the GATT 1994 
regarding the costs for services rendered. This member seeks  transparency in how fees are 
calculated and the elimination of ad valorem met hodology in favour of  recovery of the costs 
for the services rendered.  We would also seek the opportunity to review the new Customs 
Code before commenting further. 
  We seek more information on the scope and nature of the new unified customs fees in this 
section and a response to the questions in the paragraph. - This description should also include when th e new fee structure will come into force, 
how these fees will be applied, the rates, the trade covered or exempted, the use to 
which the revenues collected will be put and the relationship of the revenues collected 
to the cost of providing the services for which the fee is charged. 
- Please provide information on how the reve nues collected in applying the customs 
clearance charges will be used solely fo r customs clearance, and how Russia will 
ensure that none of the revenues collected by this charge are used for the customs 
clearance of exempted imports or exports.  Will they replace all other Customs charges on imports?  If not, please provide upda ted information on other charges that 
will continue.  
- Fees that are applied only to imports for requirements normally applied to both 
imports and domestic products, e.g., for sta ndards certification or vehicle taxes, are 
not consistent with Article III.  We seek Russia’s confirmation that such fees will be 
revised or eliminated prior to accession.   
 95. 109-111 and Table 13  We note that Table 13 contains no reference to fees for the service of 
conducting tariff quota auctions (paragraph 102 re fers).  We do not agree that, under GATT 
Article VIII, tender premiums imposed at aucti on can represent a fee for a service, as the level 
of the tender premiums cannot be determined at  auction in a way that reflects the cost of 
providing the service and would normally far exceed  such a cost.  (It is in the nature of 
auctions, properly conducted, that their outcomes cannot be fixed.)  There is therefore an inconsistency in Russia’s position.  In paragra ph 102 Russia claims that the tender premium is 
a fee for a service.  However in paragraph 109 Russia correctly does not claim the tender 
premium as a fee for a service. 
- We seek an explanation from Russia. 
We welcome Russia’s recognition at paragraph 111 of  the need to modify its fees and charges 
to eliminate their ad valorem form and thereby fulfil one important condition for ensuring that 
such imposts will be limited to the cost of th e service, i.e., not being made to depend on the 
customs value of the goods.  This will be need ed for appropriate conformity with Article 
VIII:1(a) of GATT 1994. - We request that reforms be undertaken by Russia to ensure appropriate conformity 
with the provisions of Article VIII:1( a) of GATT 1994, including through the 
replacement of ad valorem imposts with a ppropriate specific imposts, and that Table 
13 under paragraph 109 of th e draft Report be amended to reflect these changes. 
 
96. 109 Table 13   In the footnotes 4 and 6 on page 37 it is stated that custom authorities may 
reduce charges for customs services. This member  asks for further information, whether the 
new Customs Code would eliminate the possib ilities to reduce the fees for customs services? 
If this not the case, then we expect the Russian  Federation to bring some clarification to the 
rationale for such exceptions. Namely, who can  benefit from the reduction and what are the 
grounds when taking such a decision? 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 23 
 
 
 97. 111 On the basis of the information contai ned in §111 and as soon as the new draft 
Customs Code will be adopted table 13 should be amended to reflect the reduction to two 
types of fees and charges. 
 98. 112 stamp tax: Please explain what you mean by "performance of legally valid actions" in 
the last sentence of para 112. 
 99. 112-113 and Table 14  Leaving aside the question of whether the fee relates to the service, 
paragraph 113 raises a number of issues relating to the nature of the service and the types of documents that attracted a stamp tax, and whether these are valid requirements.  Russia has 
not responded to the questions raised.  Ru ssia has also not responded to the question 
concerning the ad valorem nature of the Stamp Tax, nor has it indicated that Table 14 would be amended appropriately.   - We ask that responses be provided to the i ssues raised by Members in paragraph 113. 
  
100. 113  + table 14  Stamp tax: for some stamp taxes the rate is ad valorem. Members have 
questioned how it relates to the cost of servi ce rendered. As an ad valorem rate is not 
consistent with art. VIII GATT, please am end table 14 in a WTO consistent way. 
 101. Tables 13, 14, 15, and 16 Please confirm that these tables are comprehensive or 
provide the additional information to make th em so.   Please distinguish stamp taxes from 
State Duties in terms of their purpose, incidence, and application. 
 
- Consular Fees (paras 116-119 and Table 15) 
102. 115  Please provide information on the issues addr essed in this paragraph, focusing on the 
key WTO-relevant issues–to what extent are any of these fees applied to import or export 
documents, i.e., to any of the documents listed in  Table 15, or in connection with the act of 
importing or exporting?  If so, which documents re quiring the fee are trade-related and is their 
use in importation and exportation optional or mandatory? - Please confirm that the authorization for the measures noted in the first and third 
“notes” to Table 13 has been eliminated. 
 
103. Para  115  please confirm the commitments of para 115. 
 
104. Para  117 "Heads of consular offices had the power to decrease fees or not to collect 
them at all from individual persons in view of their applications, if the reasons specified by 
them were considered to be valid". This paragra ph needs to be elaborated. In particular a more 
elaborated answer is needed to explain in wh ich cases the heads of consular offices do so and 
what reasons are considered to be valid ? 
 
105. 116-119  This section appears generally acceptable subject to two points of 
clarification. - The commitment paragraph (119) is in brackets indicating that there is an issue to be 
resolved.  We would like to ascertain th e extent to which commercial documents 
require consular certification. 
- Is consular certification required of commerc ial bills, certificates of origin, etc?  If the 
answer is yes, could Russia explain how this would be WTO- consistent, as the 
measure would represent a burden on im ports not applied to domestic goods. 
 
106. 118 
 Table 15 provides a fee table for various consular services, showing how the fee 
charged differs between the CIS and Baltic c ountries and all other countries.  This list 
includes a number of consular fees of potential significance for trade, in particular (1) fees for WT/ACC/SPEC/RUS/25/Add.1 
Page 24  
 
 certification and notarisation of documents, (2) f ees for notarisation of agreements subject to 
evaluation, (3) fees for notarisation of authentication of signature, (4) fees for consular service of sea- or aircraft, including for issuing certificat es of loading or unloading, for notarisation of 
various certificates and applications, including the cargo certificate, and for notarisation of 
sanitary certificates. 
Russia needs to respond either (a) to demonstr ate that in fact these fees are in no way 
connected with trade and therefore are not cove red by GATT Article VIII requirements, or (b) 
to specify what steps it is taking to ensure th at such fees are levied on a non-discriminatory 
and WTO-consistent basis. 
 
107. 119 These members consider the following to be appropriate commitment language in 
respect of consular fees: 
“Russia will ensure that all consular fees connected with imports or exports of goods 
or services are levied in a manner consistent  with WTO obligations, including Article 
I and Article VIII of the GATT and accordingl y would apply the same fee scale to all 
foreign companies on a non-discriminatory b asis and ensure that fees will reflect the 
actual cost of services rendered.” 
 
108. Para  119 needs to be confirmed 
 109. Table 15 needs to be modified to be WTO compliant in particular with art. I GATT. 
Presently there is discrimination between CIS and Baltic countries towards Other countries 
(rate of consular fee 10 times higher for other countries) 
 
- Other Fees (paras 120-121 and Tables 16 (a) and 16 (b) 
110. 121   The report should include updated information on steps taken by Russia to eliminate 
discriminatory port user fees. 
- Import Surcharge (paras 122-123) 
111. 122-123 At the end of P.123 the last two words “that Article” should be replaced with 
“the Balance of Payments Provisions of the GATT 1994”.  
 
112. 122 Please indicate the No of the Government resolution of 27 February 1999 that 
eliminated the import surcharge as from March 1999. 
 113. 122 Could the RF inform about the circumstances in Law 63-FZ, art. 15, that trigger the 
use of an import surcharge measure?  What type of measure could be used? 
 
114. 123 a new paragraph containing the commitme nts of the Russian Federation about a 
separate legislation on trade remedies consistent  with the relevant WTO provisions should be 
added after §123. 
 
115. 123   We seek the inclusion in the draft Report of responses to the concerns raised by 
Members in paragraph 123. We seek th e inclusion of commitment language. 
 
116. 122-123  Are import surcharges authorized under any of Russia’s new customs laws (e.g., the 
amendments to the Customs Tariff Law, the ne w Customs Code, and Chapters 26 and 27 of 
Part II of the new Tax Code), and if so, where? - We seek a commitment from Russia confirming that after accession the application of 
any such measures authorized, either for BOP or other purposes, will be in 
conformity with WTO provisions.   WT/ACC/SPEC/RUS/25/Add.1 
 Page 25 
 
 
  
Application of Internal Taxes on Imports 
- Excuse Taxes (paragraphs 124-128, Table 17) 
117. We welcome progress made towards WTO conformity through the progressive elimination of 
discriminatory rates and application of excise. 
- We ask that Russia eliminate the differen tial rates of excise on exported natural gas 
and to respond to this issue in the context of paragraph 128  of the draft Report. 
- We ask that Russia respond to  the questions raised in paragraph 127  about 
discrimination against imports. 
- We ask that a commitment paragraph be included. 
 
118. 124-128  In Table 17  suggest that the box for “Wines (except for natural wines)” be 
reworded to either “Wines to which alc ohol has been added” or “Fortified wines”.  
 
119. Table 17  Please revise the table to indicate where “wine coolers” are covered.  Please 
clarify the difference between “natural win es” and “wines”?  Why is the excise tax on 
“natural wines” so much lower?   - Are the“excise taxes” applied to exported natural gas the only excise taxes applied to 
exports?  Are excise taxes exempted for other exports? 
We seek response to our previous questions on the issue of “credit” given on the excise tax 
bill for imports into Russia from other CIS c ountries for excise taxes paid in their home 
markets.  This constitutes discriminatory treatment and is a violation of MFN treatment.  Is 
this measure still applied?  If so, how, and wh at is the timetable for its elimination? 
 
120. Table 17 why is a tax rate of 0 Rubble per l itre for beer with normative (standard) 
volume of fraction of ethyl alcohol up 0,5% inclusive on the list  ? 
 
121. 128 a new paragraph containing the answers and the commitments of the Russian 
Federation should be added afte r §128 to address the concerns expressed in § 127 and 128. 
 
- Value Added Tax (paras 129-135, Table 18) 
122. 129 – 135 The text would benefit from a description of the “country of destination 
principle” in para 130.  Item 5 of Table 18 regarding fish caught by fishing enterprises of the 
Russian Federation requires explanation to avoid the impression that these products are not eventually subject to VAT.  
 
123. Table 18:  
- Please update the information in the table on VAT exemptions to reflect the additions 
or changes implemented in January 2002. 
- Please describe the content of Article 149 of the Tax Code and indicate how it relates 
to the provisions of the new Tax Code..   
- Please clarify the meaning of the clause “land lo ts begin the territory of a foreign site 
covered by the Russian Federation’s right of land use on the basis of an international 
treaty”.  
 124. 130-131  Russia should harmonize its VAT policy with Belarus with the destination 
principle as soon as possible and no later than upon accession. 
 
125. 130-131 We seek clarification of when the destination principle will be adopted in the 
application of VAT to products importe d from Belarus (paragraphs 130 and 131). WT/ACC/SPEC/RUS/25/Add.1 
Page 26  
 
  
126. 131 + 135  members requested a more precise timetable for unifying application of VAT on all 
products on the basis of the country of destina tion. § 135 should be amended to address this 
request. Please confirm the commitment in § 135. 
 
127. 133  Please explain how the exemption of dom estic agricultural output from the VAT is 
justified under GATT Article III.   
 
128. 133  We welcome progress made towards WTO conformity through the progressive 
elimination of discriminatory rates and application of value added tax.   
- We seek a response to the concern e xpressed in paragraph 131 regarding the 
unification of VAT on oil and gas imports. 
The exemption of the products of certain agricultural and fish producers from VAT 
(paragraph 133) creates uncertainty as to how na tional treatment will be accorded to imported 
like products, and raises doubts as to whether th is aspect of Russia’s VAT system is in 
conformity with Article III:2 of GATT 1994. 
- We seek clarification of whether imports of agricultural and fishery products are 
exempt from VAT and, if not, details of Russia’s plans to achieve appropriate WTO 
conformity by the date of accession.  
- We seek clarification of how it is possible in a VAT system presumably based on the 
destination principle for VAT exemptions to  be accorded to the products of some 
agricultural producers, but not to the like -products of other agricultural producers 
(including of the like-products of foreign agricultural producers), given that VAT is 
presumably levied at the point of sale under Russia’s destination principle. 
- We presume that the exemption is for producer s rather than products.  Is this correct?  
What is the legal basis for this? 
- Are such exemptions provided at the point of sale?  If so, how are the products of 
certain agricultural producers distinguished at the point of sale from the like-products 
of other agricultural producers so that the exemption may be provided?  What are the 
processes involved in applying the VAT exemption criteria in this way, and their legal basis? 
- Are Russian producers of certain products all deemed to automatically satisfy the 
criteria for exemption (e.g., producers of sugar beets) as all producers of such 
products are presumed to be “small”?  If so, we seek full details of these products, 
and the legal basis for such products being deemed to satisfy the relevant criteria for 
VAT exemption. 
- Is this provision for VAT exemption for cer tain agricultural producers applied where 
output is bartered for goods or services or used as payment in kind for discharging 
financial obligations to financial institutions  or other creditors, given the difficulty of 
enforcing, and establishing a basis for, VAT (and other indirect tax) obligations in the case of such non-monetised transactions?  If so, we seek full details, including the legal basis for bartered products and produc ts provided in kind in order to discharge 
financial obligations being deemed to satisfy  the relevant criteria for VAT exemption. 
- More generally, is there any provision for VAT exemption for producers in any sector
 
that is applied where goods or services are bartered for goods or services, or provided in kind for discharging financial obliga tions to financial institutions or other 
creditors?  If so, we seek full details, incl uding the legal basis for such goods or 
services being deemed to satisfy the relevant criteria for VAT exemption. 
- Is VAT applied at source in relation to  any domestically produced agricultural 
products (where imported like-products ar e however subject to the destination 
principle), so that the authorities provide ex emptions where they are able to directly 
distinguish exempt Russian agricultural producers from non-exempt Russian agricultural producers?  If so, we seek details of this “dual” VAT system, and the  WT/ACC/SPEC/RUS/25/Add.1 
 Page 27 
 
 
 legal basis for applying VAT at source for certain exempted producers of agricultural 
products. 
 
129. 135  It is appropriate to complete paragr aph 135 as follows:  "…, without exceptions, 
regardless of regional destination of goods.  The Working Party took note of this 
commitment." 
 
Quantitative import restrictions  (paras 136-138) 
130. 136 Please provide updated information concerning the elimination of the ban on imports 
of alcohol. 
 
131. 138 Please provide updated information on the stat us of other nontariff restrictions on the 
importation of alcoholic beverages. 
 132. 136-138 Russia should provide further inform ation on the latest legislative 
developments and its intentions for the futu re import regime for ethyl alcohol, alcoholic 
drinks and alcohol-containing pr oducts and confirm that the existing legislation, which 
restricts imports of distilled spirits to no more th an 10% of alcohol sales in Russia and, within 
this quota, requires that no less than 60% of impor ts must contain 15% of alcohol or less, will 
be repealed or otherwise not implemented. 
 
 We seek a response to Members' concerns in relation to the measures and legal instruments 
mentioned in paragraphs 137 and 138 . 
 
133. 139 a new paragraph should be added after §139 containing the answers and 
commitments of the Russian Federation.  
 Import Licensing Systems (paras 139-152 and Tables 19 (a) and (b) 
134. 139– 152 This section would benefit from greater organization and clarity, based on the 
new law being drafted.  The justifications offe red in a number of instances would need to be 
substantiated.  Clarity is required con cerning the relationship between licensing of 
pharmaceuticals, food products, electrical devices including encryption devices with 
SPS/TBT requirements.  Further discussion of the revised legislation awaiting presentation to 
the Duma will be necessary.  
 
 The information included in the this section of the Report is not laid out in a systematic 
fashion that will allow the WP to follow the evolution of Russia’s policies and legislation 
towards WTO consistency.   
- Please provide up to date information based on the Import-Export Licensing 
provisions of the new Regulation of Foreign Trade Activities law.   
- Please provide information, including a description of their provisions, on recent 
orders issued by the veterinary service of the Ministry of Agriculture (i.e., #13-8-01-/3150, 13-8-01/3403, and 13-8-01/3231) that effectively act as discretionary import 
licenses.  Please provide information on how these orders were issued and how they 
are applied.  Are there domestic equivalent s of the requirements in these orders, i.e., 
to address the same veterinary issues?  If so, please describe them and provide information on their intended effects. 
- Please provide Information on licensing criteria and fees, for each product subject to 
import licensing, including poultry imports .  Please indicate how these requirements 
are applied consistently with the WTO Agreements on Technical Barriers to Trade WT/ACC/SPEC/RUS/25/Add.1 
Page 28  
 
 and Sanitary and Phytosanitary Measures, a nd in a manner no less favorable than than 
to similar domestic products. 
- Please respond to the request for a revised WT/ACC/RUS/10, based on the provisions 
of the new law, and including information on the proposals for the Law “On Medicines.” 
 
 It remains unclear whether key aspects of Russia’s current regime relating to import licensing 
systems are in appropriate conformity with WTO requirements. We support concerns raised by Members regard ing the scope for justifying controls under 
GATT Article XX, as well as those being justif ied under Article XX rather than the SPS or 
TBT Agreements (e.g., pharmaceutical products, drugs etc., products for plant protection, 
sturgeon species of fish).  We ask Russia to  address the substance of those concerns. 
While import licensing may be the appropriate mechanism for administering certain controls, the justification for controls needs in all cases to be fully in accordan ce with applicable WTO 
rules, as much as the specifics of the import lic ensing procedures used to administer those 
controls. 
We also expect that all measures imposed by Russia (e.g., fees and charges, SPS measures 
and other technical regulations  and conformity assessment pr ocedures, licensing and approval 
requirements and procedures) will be applied equally and uniformly to Russian legal and 
natural persons and Russian products as they ar e to foreign legal a nd natural persons and 
foreign products. 
- We ask that Russia to provide positive confirmation of national treatment being 
accorded to foreign legal and natural pers ons and foreign products, in respect of 
where intending traders are subject to activity licensing requirements and/or 
import/export licensing requirements. 
- We request full details of all respects in which foreign legal a nd natural persons and 
foreign products are subject to different requirements from those applicable to 
Russian legal and natural persons and Russian  products, in relation to substantive and 
procedural aspects of activity licensing and in relation to import and export licensing. 
- Russia needs to respond in a substantive wa y to the concerns expressed by Members 
in paragraph 146 (relating to alcohol) , paragraph 147-149 (pharmaceuticals), 
paragraph 150 (precious stones and metals). 
- We seek inclusion in the Report of detailed responses to Members’ requests in 
relation to the matters rais ed at paragraphs 146-150. 
- We seek inclusion in the Report of a respon se to the request at paragraph 151 that 
details of Russia’s current and proposed  procedures for import licensing, whether 
automatic or non-automatic, be clarified. 
- The draft undertaking in paragra ph 152 is in bracketed text and will need to be agreed 
once the substantive issues are resolved. 
- We ask that the second sentence make clear that  “The import licensing regime from 
the date of accession would be …”, rather than the present formulation that refers to “Amendment … after accession would be …”. 
 
135. 139 a new paragraph should be added after §139 containing the answers and 
commitments of the Russian Federation.  
 136. 140   Members have indicated on several occasions that they do not agree that the current 
Russian legislation is consistent with WTO pr ovisions, and this issue will need resolution as 
the Working Party report evolves.  These points should be reflected in the text. 
 137. Table 19 a +142+144 +145 +148 + 149  (consistency to impose an non automatic import LIC 
on pharma?): members have expressed many  concerns and questions about licensing 
requirements for pharmaceutical products.  WT/ACC/SPEC/RUS/25/Add.1 
 Page 29 
 
 
 For instance in § 145. the 0.05% fee on the cont ract value of goods is not compliant with 
article VIII GATT. In para 144 the applican t must have an activity licence to import 
pharmaceuticals and para 145 mentions a prelim inary permit for imports delivered by the 
Ministry of Health. Please explain the rationale of such a preliminary permit and how is it 
consistent with the Import licensing Agreement  (article 1.6 Agreement on import licensing 
says that the application procedures shall be as simple as possible). As for pharmaceutical 
products are non-Russians also allowed to impor t and export pharmaceuti cal products ? Under 
which conditions ? Do the same conditions appl y to Russians and foreigners ? If a foreign 
company exports pharmaceuticals to Russia and th e importer is a Russian company, do both 
companies need a special activity li cence or only the Russian company ? 
 
138. 144   The statement in this paragraph that “tha t the Russian Federation had no intention to 
limit the quantity and value of imports, except as provided for in international conventions such as the Montreal Protocol or Basel Convention” is clearly not correct.  The current application of licensing requirements for imports pharmaceuticals, sugar, alcoholic beverages, 
and precious stones and metals restricts imports.  Russia should ensure that the report reflects 
a strong presentation on how these restrictions w ill be modified or eliminated to meet WTO 
requirements. 
 139. 144  The paragraph 144 of the draft Report stat es that the purpose of the licensing regime 
is to monitor and control imports of goods and that the Russian Federation does not intend to 
limit the quantity and value of imports.  If it is so, then why is the import of ethyl alcohol 
subject to non-automatic licensing in the Russian Federation?  If the purpose of the licensing 
regime is that mentioned in paragraph 144, then we urge th e Russian Federation to make a 
stronger commitment that would ensure that any import licence on ethyl alcohol and other alcoholic drinks is granted automatically on the principles compatible with the WTO 
requirements. 
 140. 145 In its paper of 20 March, these members al ready invited Russia to explain how the 
0.05% administrative fee charged by the Minist ry of Health for issuing permits to import 
pharmaceutical products is consistent with GA TT Article VIII requirements.  We invite 
Russia to respond on this point. 
- Russia should provide updated information on its import licensing regime and 
relevant legislative initiatives.  These member s are also interested in receiving further 
information relating to the import regime for cryptographic products, an issue which was raised at the 24/25 April meeting.  
 
141. 149  We seek Russia’s substantive response to  the concerns expressed in paragraph 149, 
including specific reference to its plans for legislative revision of the current regime. 
 142. Table 19(a)    The justifications for some of Russia’s licensing provisions, as currently 
applied, are questionable, e.g., for pharmaceu tical products, products for plan protection, 
ethyl alcohol, vodka and other strong alcoholic be verages, and raw sugar.  In addition, we 
need additional specificity on the criteria for non-automatic licensing of imports of 
“equipment for unauthorized receipt of inform ation” and further refinement of the HS 
numbers identifying “encryption” devices” under im port license.  Finally, we cannot find HS 
854380 in Russia’s tariff schedule.  
 
143. 150 Please indicate what have been undertaken to amend or repeal Law No 86 concerning 
pharmaceuticals. Has the new draft Foreign trade and Import Export Licensing Law been adopted yet ? What will be the main changes introduced by this law ? 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 30  
 
 144. 151 As mentioned in this paragraph please provi de an updated description of your import 
licensing regime and the specific criteria fo r the application of the various licensing 
requirements. 
 145. 152 this paragraph should be further elabor ated to address all the inconsistencies 
mentioned by the members and to include the commitments of the Russian Federation on the 
issue of import licensing for pharmaceuticals. 
 
- Customs Valuation (paras 153-161) 
146. 153 – 161 This member  joins calls for more cl arity in the text and agrees with the 
expressed need to study Chapter 27 of the Tax Code which contains requirements ensuring 
consistency of customs valuation procedures with WTO requirements before offering more 
substantive comments.  We will, however, be l ooking for clarity in areas such as valuation of 
transactions between related parties, methodolog ies as they relate to the interpretive notes, 
and full implementation of Article 13 of th e Agreement providing for pre-release pending 
final determination of value.  
 147. 153-154 This part of the text should be expanded  to include the oft expressed views of 
WTO members that Russia’s current legisla tion, as described in para 154, does not/not 
conform to WTO provisions.   
 
148. 155-157 If the term “special technique” is to be  used, the text of para 155 should be 
expanded to include description of what the “special technique” is, operationally, and how 
and when it is used.   Russia’s assertion that it is simply a tool to co mbat under-invoicing should be balanced with 
the views of U.S. and other delegations that  it constitutes use of minimum and arbitrary 
values, which are prohibited by the WTO Valua tion Agreement, but not by Russia’s current 
customs valuation laws and regulations. 
 149. 156 this paragraph should provide a fuller descr iption of the concerns of members as 
regards the “special technique of customs control”.  
 
150. 158  Please describe the improvements in Russia’s customs valuation regime that will be 
implemented by Chapter 27 of the Part II of the Tax Code. 
 
151. 159 Members mentioned that presently there is no guarantee system allowing an importer 
to withdraw goods from customs pending final de terminations of the customs value if he 
provided sufficient guarantee. Please indicate wh ere in the new tax Code or draft customs 
Code such a system is foreseen. 
 152. 159  We ask that a response to the concern rai sed in paragraph 159 regarding the guarantee 
system required under the Agreement on the Im plementation of Article VII of GATT 1994 be 
included in the draft Report. 
 
153. 160 Russia needs to provide updated informati on on legislative and other initiatives to 
ensure WTO conformity in this area. 
 154. 160  We support and seek a response to Members’ calls for further information on the 
amended Tax Code and the draft Customs C ode to ensure meaningful discussions on 
conformity with WTO requirements.  
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 31 
 
 
 155. 161   should be further elaborated with info rmation on the new tax code and the draft 
customs code dealing with customs valuation.  Please confirm the commitments in square 
brackets. 
 
- Rules of Origin (paras 162-171) 
156. 163 We refer to the reference in paragraph 163 to country quotas and “other methods for 
regulation of foreign economic activities”.  - We seek the inclusion in the draft Report of explanations of the circumstances under 
which these two measures are applied. 
 
157. 166 it is stated that goods of which the origin has not been clearly established are cleared 
through customs only after payment of customs duties at non-MFN tariff rates (ie at a rate double that of MFN rates).  Can Russia clarify whether in such cases it is possible to submit a 
certificate of origin subsequent to custom cleara nce and if origin is subsequently satisfactorily 
established in this manner, duties  are then refunded? 
 
158. 167 and 168 these paragraphs should contain a fuller description of the criteria applied for 
determining preferential origin both from CIS countries and under Russia’s GSP scheme and 
their legal basis.  In addition, do the custom s procedures include any guarantee system which 
allows release of goods pendi ng determination of preferen tial origin?  How does any 
associated rectification procedure (subsequent re fund or recovery of customs duties) operate? 
  
159. 169-170  Please provide specific and updated information on the new Rules of Origin 
provisions in, e.g., new Customs Code and Ch apter 27 of Part II of the new Tax Code. 
Do Russia’s preferential rules of origin for the CIS reflect the interim rules of the WTO 
Agreement in Annex II of the Agreement? 
 
160. 169 and 170 We seek the inclusion in the draft Report of a response to the substance of the 
issues raised in paragraphs 169 and 170. 
 
161. 171 in the second sentence of this draft co mmitments paragraph, the phrase “the 
requirements of Article 2(h) and of Annex II, paragraph 3(d)”   is left hanging. 
 
- Other Customs Formalities (paras 172-176) 
162. 172-176 these members consider that in due course an appropriate commitment 
paragraph should be introduced at the end of this section. 
 
163. 172 – 176  A comprehensive list of all Orders rest ricting entry points by commodity and 
by country of origin should be provided.  Such  restrictions should be removed unless they can 
be justified under the WTO. 
 
164. 173, 174  At the beginning of our meeting, the delegation of Georgia expressed its 
appreciation to the Secretariat for accurate drafting of the Report.  I would like to reiterate the 
importance of problems described in para graphs 173 and 174 regarding the customs 
regulation and simplification of border contro l measures and necessity of bringing all these 
inconsistencies under the WTO legal umbrella. 
 
In our opinion, the problems listed in pa ragraph 174 of the draft Report still remain 
unresolved and open.  Therefore, we seek the commitment from the Russian Federation to 
prevent the illegal flow of smuggled goods from its territory.  We also urge the Russian WT/ACC/SPEC/RUS/25/Add.1 
Page 32  
 
 Federation side to remove all customs forma lities, which represent hidden barriers to trade 
and major trade distorting measures, prior to its accession to the WTO. 
 
165. 175  This member  expects the Russian Federation to undertake the commitments 
mentioned in para 175 regarding the publi cation of all regulations, formalities and 
requirements connected with the importation of goods and to eliminate the inconsistencies 
between the general legislative framework and subsidiary regulations and administrative 
guidance issued by the Russian Federation government bodies. 
 
166. 175-76 Statements made by WTO Members at the January and April 2002 meetings of the 
WP, concerning specific problems with Russia’s cu stoms regime should be elaborated in the 
draft Working Party report text.  Russia’s use of restricted customs entry ports on a country-
specific and product specific basis and other efforts to limit the scope of trade are clearly inconsistent with GATT Article IX unless they can be otherwise justified under WTO 
provisions.  
- Please describe all such measures in place, listing countries and pr oducts covered.  
Please provide copies of all SCC Orders in this regard. 
- Please explain the reasons for the efforts of  Russia’s customs service to narrow the 
ability of WTO members to trade with Russi a and how this type of initiative will be 
regulated after WTO accession, i.e., will the authority of the SCC to order such restrictions be reduced or eliminated? 
 
167. 176  A paragraph should be added after pa ra176 containing the commitments of the 
Russian Federation addressing the concerns expressed by members. 
 
 We seek the inclusion in this section of the dr aft Report meaningful responses to all of the 
concerns raised by Members on customs formalities ( paragraphs 173, 174, 175 and 176 ), 
including aspects of these and other issu es raised in Working Party discussions. 
 
168. 176 bis  A Member said that it had concerns about the practice of authorisation of 
very limited number of customs check-points d esignated for exportation of certain products, 
and also about the practice to close promptly  certain customs check-points, thus creating 
serious trade barrier.  He had concerns a bout the Order of the State Customs Committee 
issued on 27 December 2000 stating that non-ferr ous and ferrous metal scrap can be exported 
only through the seaports of the Russian Fede ration.  This Member requested Russian 
Federation to ensure that these and other measu res related to exportati on would be brought in 
full conformity with the WTO provisions. 
  This addition concerns exportation, but the problem s are essentially of the same type as those 
referred to in this Section, which is a part of  the larger Chapter "Import Regulations".  It is 
also acceptable if this language is inserted  in the Chapter "Export Regulations" as 
subchapter "Other Customs Formalities", which then would be paragraph 198 bis. 
 
- Pre-shipment Inspection (paras 177-178) 
169. Have there been any new developments that requi re further expansion of these paragraphs?  If 
so, please provide information on them.. 
 
170. 178  We are concerned that the bracketed text  in paragraph 178 suggests that Russia may 
implement preshipment inspection in the future.  While recognising that the WTO does not 
preclude such a step, subject to meeting a range of requirements, we be lieve this would be a 
backwards step, and we would far prefer to see Russia engage customs reforms that would address problem areas.  WT/ACC/SPEC/RUS/25/Add.1 
 Page 33 
 
 
 - Why does Russia consider it might be necessary to implement preshipment 
inspection? 
 
171. 178 Please confirm the commitments mentioned in this paragraph. 
 
- Anti-Dumping, Countervailing Duties a nd Safeguard Regimes (paras 179-184) 
172. 179 – 184 the penultimate sentence  in P.179 will n eed to take into account that there 
are additional requirements in each of the th ree Agreements concerning the duration of 
measures.  It will be essential to be able to re view the new draft law before this section can be 
completed.  We would expect this section to explain in appropriate detail the procedures put 
in place in Russia to address issues of dum ping, subsidization a nd the introduction of 
safeguard measures, as well as of injury. 
 
173. 180 we invite Russia to submit updated info rmation on these legislative initiatives, 
together with copies of new legislation when they are available. 
 
174. 180     We seek an update on the passage of legislation referred to in paragraph 180. 
 
175. 181 What is the point of view of the Russian Government regarding the allegations that " 
current legislation provided by the Russian aut horities did not appear to be consistent with 
relevant WTO provisions". We would like to ha ve "an appropriate commitment that should 
confirm the full conformity of the new La w and regulations and their modalities of 
application with relevant WTO Agreements", as  mentioned in paragraph 182. In that sense, 
we would like the brackets in paragraph 184 to be deleted. 
 176. 181-183  Members have raised what appear to  be several legitimate concerns in 
paragraphs 181-183. 
- We ask that the substance of these concerns be addressed. 
 
177. 183 this paragraph should be converted into formal commitments by Russia.  
 
178. 183 We seek Russia’s response to the concerns  expressed in para 183 and agreement to 
the commitment requested. 
- Please provide a list of all current antidumping, countervailing duty, and safeguard 
actions in place against imports, listing both products covered and countries affected. 
- What is the functional difference in pro cedure or penalty application under the 
current Russian “trade remedies” regi me between antidumping remedies and 
safeguards? 
- By what date does Russia foresee enactment of the new legislation and 
implementation of new procedures in such cases? 
 
Export Regulation 
- Export Duties (paras 185-188) 
179. 185-188   This member  requests Russia to provide a list of products subject to export duties. 
 
 We support concerns raised by Members ove r export duties applied by Russia, and the 
adoption by Russia of accession commitments to phase them out and not have recourse to 
them in the future. WT/ACC/SPEC/RUS/25/Add.1 
Page 34  
 
 - We seek the inclusion in this section of the draft Report responses to these concerns 
and statements of Russia’s agreement to these requests. 
- We ask that full details of Russia’s export duti es be set out in a Table to be located in 
this section of the draft Report.  We ask th at such a Table be updated in each future 
iteration of the draft Report. 
 
180. 185-188  It seems appropriate to add the follo wing text to paragraphs 185-188:  "The 
representative of the Russian Federation confirme d that, in particular export duties and VAT, 
on a non-discriminatory basis vis-a-vis  to all WTO Members and goods, without any 
exceptions.  The Working Party took  note of this commitment.". 
 
181. 185 the WP report should incorporate a full listing of export duties by HS-number and 
with applied duty rates.  Russia should update the WP on the latest changes made in this area. 
In due course, this section will need to incl ude an appropriate commitment paragraph.  
 
182. 185 please confirm that the list of goods subject to export duties is exhaustive and has not 
been modified recently. 
 183. 188 a new paragraph should be added after para188 containing the commitments of the 
Russian Federation addressing the concerns of the members. 
 
184. 188  Russia should respond to the comments in th is paragraph in particular addressing 
future plans, in conjunction with export tariff, VAT, and excise changes.   - Members have requested clarification on  whether the Russian Federation is still 
levying VAT on any exported products.  Please address as well the efficiency and 
timeliness of VAT export refunds.  We unders tand that exporters have had difficulties 
claiming such legally permissible refunds, an d that there have been delays in their 
transmittal, without explanation. 
 
- Quantitative Export Restrictions, Includi ng Prohibitions and Quotas (paras 189-190)  
185. 189 We are pleased that a number of quantitativ e export restrictions were abolished in 
1996. 
- We ask that details of the export restric tions abolished in 1996, and any which may 
have been abolished since 1996, be included in this section of the draft Report to 
record Russia’s reform progress in this area. 
- We seek full clarification of the refe rence to essential national interest as a 
justification for export quotas, what this means, and the connection this has to the 
GATT provisions that refer to essential security interest . 
 
186. 189-193 as already indicated, these members e xpect Russia to commit to abide by 
WTO rules in respect of non-automatic export licensing and export restrictions and to eliminate all non-automatic licensing requirements and export restrictions upon accession unless they can be specifically justified under WTO provisions.  A consequent commitment 
paragraph should be included in future drafts. 
 
187. 190  We would appreciate information on the sort s of timber products that are covered by 
these measures, and clarification of whether this  restricted use of checkpoints for exports is 
more widespread, i.e., are there additional products? 
- Please explain how, and the degree to which, the commission for the Access to trunk 
Oil and gas Pipelines allocates the distribu tion of oil and gas between domestic and 
foreign markets. 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 35 
 
 
 - Export Licensing Procedures (paras 191-195, Tables 20 (a) and (b)) 
188. Table 20(a)  Are there any licensing requirements for export of fertilizers? 
 189. Table 20  We welcome that Russia is no lo nger seeking WTO legal cover under the 
exceptions of Article XX of GATT 1994 for measur es applied by means of the non-automatic 
licensing to exports of certain precious metals and stones, objects made thereof, and certain 
alloys, semifabricates, ores, concentrates and wastes (Table 20(a) under paragraph 191).  We 
fully concur that in respect of such measures it will not be appropriate to seek to invoke any 
of the exceptions of Article XX of GATT 1994. 
 
190. 191  We seek the inclusion in this section of the draft Report clarification of the statement, 
“the procedures for export licensing were the same as for import licensing” (paragraph 191). 
 191. 192-195 There are some important questions raised by Members in this section of the 
draft Report that Russia has not answered. 
- Members asked Russia to justify export restrictions on precious stones and metals 
(paragraphs 192 and 194).  Russia should include in this section of Report a 
clarification and full explanation of th e purpose and justification sought under GATT 
Article XV:9(b) for the non-automatic licen sing of exports of precious metals and 
stones, objects made thereof, and certain alloys, semifabricates, ores, concentrates 
and wastes. 
- To help facilitate such clarification and e xplanations, we seek the inclusion in this 
section of the draft Report of details of: - the measures applied under the non-au tomatic licensing of exports which 
Russia is seeking to justify under GATT Article XV:9(b), including descriptions of the measures, the bodies involved in applying those measures 
including details of their responsibilities, the products affected by each 
measure, and the legal basis for those measures (regulations, executive decisions, administrative decisions and other legal instruments and legislative acts)  
- the export licensing procedures applicable, including inter alia full details of 
any restrictions on eligibility for export licenses, all other terms and 
conditions associated with their issuan ce, and the procedural aspects of the 
issuance of such licenses 
- the provisions of Russia’s exchange arrangements with the IMF currently in 
force that require Russia to adopt or maintain the measures applied by means of the non-automatic licensing of exports  Russia is seeking to justify under 
GATT Article XV:9(b) 
- Russia’s plans to eliminate all measures applied by means of the non-
automatic licensing of exports that may be required under provisions of 
Russia’s exchange arrangements with the IMF at the conclusion of the term of any such arrangements currently in force. 
- Members also raised the justification for export restrictions on alcohol, vodka 
and pharmaceuticals (paragraphs 192 and 194) and restrictions on customs 
posts and distribution (paragraph 195). 
- We seek the inclusion in this section of the Report Russia’s responses to 
these concerns.  
 
192. 193:  We support the concept of this commitment, but it is not clear how Russia intends to 
justify its existing restrictions on exports of  precious metals and stones, pharmaceuticals, 
alcohol, and products for plant protection.  There is not enough information to agree that these 
requirements are justified under GATT Articles XX or XXI, nor other WTO Agreements.   WT/ACC/SPEC/RUS/25/Add.1 
Page 36  
 
 - Please provide this information.  In add ition, these issues should be addressed in the 
text and in the Working Party. 
 193. 194-5 we invite Russia to respond to the issu es raised in these paragraphs and supply 
updated information in the different areas specified. 
 
- Export Financing, Subsidy and Promotion Policies (paras 196-198) 
194. 196 – 198: 197  should reflect that members called on the Russian Federation to revise its 
domestic law/regulations for any identified s ubsidy measures so as to eliminate prohibited 
industrial export subsidies as of accession.  
 
195. 196 and 197 We seek the inclusion in this secti on of the draft Report of meaningful 
responses to the concerns raised by  Members under paragraphs 196 and 197. 
 
196. 197  Please provide information on the extent to which Russia’s State Aids Law deals 
comprehensively with subsidies.  Does it c over subsidies funded by “revenues foregone” by 
the State, e.g., tax exemptions or th rough state-mandated price controls?   
- We understand that the original draft law is being re-drafted.  Please provide a 
description of the draft State Aids law for the WP report text.   
- Please list and describe in the WP repor t Russia’s export and import substitution 
subsidies, at both the federal and regional le vels,  and the subsidy effect of price and 
availability of natural gas to export indust ries, both in terms of (a) world prices and 
(b) the price and availability to other commercial concerns within Russia.  
 197. 197-198 paragraphs 197/198: the text should include a reference to Russia’s 
recognition that export subsidies cover more than budget subsidies.  The commitment 
paragraph should include proposals made by me mbers as regards a commitment to cover all 
levels of government and identify the different possible methods by which subsidies might be 
provided (ie including exemptions, reductions, de ferrals or forgiveness of taxes and duties).  
Russia should also make a commitment not to invoke Articles 27-29 of the Subsidies Agreement.   The following language w as already proposed by these members: 
“The representative of Russia confirmed that  Russia would, upon accession, grant no export 
subsidies in the meaning of Article 3 of the SCM Agreement. This commitment covers 
subsidies at all levels of government, in cluding exemptions, reduc tions, deferrals or 
forgiveness of taxes and duties to enterprises which are contingent upon export performance.  
The representative of Russia confirmed that Russi a would not invoke any of the provisions of 
Articles 27, 28 or 29 of the SCM Agreement.” 
 3. Internal Policies Affecting Foreign Trade in Goods 
- Industrial policy, including s ubsidy policies (paras 199-206) 
198. This section should include information on the elimination of coal subsidies. 
- We ask that details of the elimination of co al subsidies be included in this section of 
the draft Report.  Have all coal subsidies been eliminated?  If not, we seek the 
inclusion of details of the remaining subs idies and Russia’s plans to eliminate them. 
 
 To what extent are loans provided under Government Resolution No. 538 (“On Provisions of 
Budgetary Loans to Finance the Implementati on of High-Return Contracts for Production and 
Supply of Products, Includi ng Export Supplies”) continge nt upon export performance? 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 37 
 
 
 199. 199  We appreciate the work Russia has done with  the WP to outline existing subsidies.  
At the current time, however, we are not prepar ed to accept as fact the statement in the last 
line of this paragraph, i.e., “At present, no b udget subsidies existed in the Russian Federation 
which could be considered as export subsidies.” 
 
200. 199- 206 this section does not fully reflect the concerns identified by these members. 
Russia should confirm to the WP its understandi ng that the definition of prohibited subsidies 
under Article 3 of the Subsidies Agreement covers  more than direct government payments. It 
should also inform the WP of latest developmen ts and plans in relation to sectoral supports, 
including to the automobile and aircraft industr ies.  Russia should confirm its intention not to 
authorise any new investment projects in th e automobile sector on the basis of existing 
legislation (notably Decree no 135 of 5 February 1998 and Resolution No 413 of 23 April 1998) and to repeal this legislation.  - These members expect Russia to make a commitment in the WP report that it will 
notify the WTO of any subsidy within the meaning of Article 1 of the Agreement on 
Subsidies and Countervailing Measures gran ted or maintained in its territory, 
organised by specific product, including those subsidies defined in Article 3 of the SCM Agreement.  The information provided should be as specific as possible, following the requirements of the questionnaire on subsidies as noted in Article 25 of the SCM Agreement.  For purposes of applying Articles 1:2 and 2 of the SCM Agreement, without prejudice to Articles 8:2(a), 8:2(b) and 8:2(c) of the SCM 
Agreement, subsidies provided to state-ow ned enterprises will be viewed as specific 
if, inter alia, state-owned enterprises are the predominant recipients of such subsidies 
or state-owned enterprises receive disproportio nately large amounts of such subsidies. 
The commitment paragraph should also be expanded to include the following language:  
- “The representative of Russia confirmed that Russia would, upon accession, grant no 
subsidies contingent upon the use of dom estic over imported goods in the meaning of 
Article 3:1(b) of the SCM Agreement. This commitment covers subsidies at all levels 
of government, including exemptions, reduc tions, deferrals or forgiveness of taxes 
and duties to enterprises which are continge nt upon the export performance or to the 
use of domestic over imported goods.” 
 
201. 203-205   Members have raised a number of concer ns specified in paragraphs 203, 204 and 
205, in relation to which more discussion will be needed. - We seek the inclusion in this section of the draft Report of responses to those 
concerns. 
 
202. 203 Re Para 203:  The report should reflect that Members noted that the Russian 
Federation representative had acknow ledged that WTO rules on subsidies cover state benefits 
provided through a range of mechanisms, including revenues foregone as well as those financed through budgetary allocations.   The reports should also reflect the view of members that, in addition to the issue of prohibite d subsidies, it was necessary for the Russian 
Federation to address those industrial subsid ies that should be notified under the WTO 
Agreement on Subsidies and Countervailing Measu res.  This member  requests the Russian 
Federation to provide detailed in formation in this regard in the form of the notification 
requirements provided for in the WTO Ag reement on Subsidies and Countervailing 
Measures . This member  would also wish to have updated information on the Russian 
Federation's comprehensive draft law on State Aids, including a description of its purpose, 
scope and provisions, and an indicatio n of when it might be implemented.  
 WT/ACC/SPEC/RUS/25/Add.1 
Page 38  
 
  
- Technical Regulations and Standards, Incl uding Measures Taken at the Border with 
Respect to Imports 
 - Technical Barriers to Trade (paras 207-223) 
203. 207-223 This member  joins other  Members in calling for an updated checklist on 
steps to implement TBT and copies of latest draft legislation.  The WP text needs significant 
work, e.g., more detailed assurances that all TB T obligations will be met, such as technical 
regulations being justified on the basis of leg itimate objectives, and a standards system that 
follows the Code of Good Practice.  The section should provide Russia’s  responses to the concerns raised by Members in paras 219-221. We look forward to the latest draft of the 
framework law. The section should also note th e changes which have b een made to address 
concerns regarding multiple marks outlined in para 219.  
 
 This section of the draft Report includes a long description provided by Russia.  However the 
section needs much more work which can only be undertaken after a full discussion of the 
issues with Russia in plurilateral process that n eed to be re-engaged and whose work needs to 
be pushed to completion as matter of high priority .  Members will need to be convinced that 
the legislative and administrative arrangeme nts will fulfil the requirements of the TBT 
Agreement. This section of the draft Report does not appear to mention obligations under Article 4 of the 
TBT Agreement or acceptance of the Code of G ood Practice at Annex 3 of that Agreement. 
- We seek appropriate action, the inclusion of  relevant information in the draft Report 
and commitments by Russia regarding adherence of standards setting bodies to Annex 3 of the TBT Agreement and comp liance of sub-federal bodies with the 
provisions of the TBT Agreement. 
 
 The report identifies a number of legislative a nd regulatory initiatives by Russia in this area: 
these appear to go in the right direction but it is not possible for the WP to confirm this without further information and sight of relevant  legislative texts.  These views are broadly 
reflected in paragraph 221 of the draft re port.  We support the proposed initiative of a 
plurilateral meeting on TBT issues in the margins of the WP meeting in mid-June.  Russia should take this opportunity to explain clearly how it intends to ensure that all TBT legislation 
and measures are fully consistent with WTO obligations at the time of accession. 
 204. 207-210 While we appreciate the information pr ovided, it does not address the aspects 
of Russia’s current regime inconsistent w ith WTO provisions nor specifically address how 
they will be amended.  Specifically: 
- There is provision for acceptance of certificates of conformity except through 
bilateral agreements or Russian membership  in international certification systems; 
- There is no list of fees.   
- There is no description of how technical regulations and other issues are circulated 
for review and comment prior to finalization.   
- There are no criteria consistent with WTO provisions to determine the justification 
for a technical regulation. 
- Please provide information on the status of Russia’s updated TBT/SPS Action Plan 
(“Inter-ministerial Program of Measures to Ensure Compliance with the WTO TBT Agreement and SPS Agreement”), as referenced in SPEC/RUS/20/Rev.1 
- Please provide a copy of the Plan to the WP, once it is finalized.    
- The details of the action plan, as they pert ain to Russia’s SPS regime should also be 
referenced in the SPS section.  WT/ACC/SPEC/RUS/25/Add.1 
 Page 39 
 
 
  
205. 209   makes reference to existing requirement s for mandatory certification of imported 
products.  Russia should update the WP on its plans to reduce its reliance on mandatory 
certification and outline the related legislative cha nges.  It is also important to ensure that 
voluntary standards do not in practice become the basis for mandatory requirements. 
 
206. Para  209 states that products imported into the te rritory of the Russian Federation should 
meet technical, pharmacological, sanitary, veteri nary, phytosanitary and ecological standards 
and requirements determined by the Russian Federation. How is it guaranteed, that both, 
Russian goods and foreign imports, are evaluated the same, applying the same regulations and 
standards? 
- With regard to the “list of goods subject to  mandatory certification […]” mentioned in 
paragraph 209 : what are the criteria that a specific product is included into this list? 
The product range that is covered by this list is much too extensive. A reduction of 
the list’s product range would also diminish the danger of technical barriers to trade. 
The Russian Authorities should rely more on manufacturer’s declaration of 
conformity instead of mandatory certifica tion. Mandatory certification should be 
limited to such cases, where it is strictly necessary to ensure public health and to 
protect the environment. 
 207. 210 Are certificates of conformity and conform ity marks issued by a foreign country only 
recognized if this foreign country has signed an interstate agreement with the Russian 
Federation or will the Russian Federation rec ognize autonomously certificates of conformity 
and conformity marks issued by foreign countries ev en if they do not have such an interstate 
agreement? 
- What conditions will such an autonomously recognition be based on? 
- Are also foreign conformity assessment bodi es given the possibility to certify for the 
Russian market? 
- Is there a list of such bodies available and what are the criteria, which those bodies 
have to fulfil in order to have their ac tivities recognized by the Russian authorities? 
- Does the Russian Federation accept results of conformity assessment procedures 
performed by foreign conformity assessment bodies if these bodies apply 
internationally agreed standards or technical  regulations, which are equivalent to the 
Russian technical regulations? Would al so regional authorities accept these results? 
 208. 211   says, that different confirmation schemes, depending on the degree of potential 
danger of products are applicable. What schemes  are these? With which international rules 
have they been harmonized? 
 209. 212 It is written under paragraph 212, that the voluntary application of state standards 
(that are based on direct application of th e corresponding international standards) should 
ensure compliance with the requirements of t echnical regulations. Will these state standards 
be equivalent to the respective international standards? Which international standards are 
taken as reference for the adoption of the state standards?  Is it certain, that the voluntary 
application of state standards leads to a presumption of conformity to technical regulations or are there any exceptions from this rule? What a product range will the mentioned 
“presumption of conformity” be applicable to?  
 
210. 212 Russia states that “all state standards (both existing and newly developed) would be 
transformed to non-binding instruments by revisi on, cancellation or adopt of new standards.”  
What is the timetable for this? 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 40  
 
 211. 214 The new, shorter, list of products subj ect to mandatory certification should be 
included as an annex in the draft WP report. 
 
212. 213 What are the respective international sta ndards that serve as a reference for the 
harmonization of domestic standards? Are ther e any trade relevant product sectors where the 
respective domestic standards will not be s ubject to harmonization with international 
standards? In this context it should be mentioned, that the current level of harmonization of domestic 
standards with international standards of 35 per cent is still too low. It would be a good 
opportunity to accelerate this harmonization process on the occasion of a further 
harmonization of the existing legislation with  the requirements of the WTO Agreement on 
TBT mentioned under paragraph 211. 
 
213. 216 Concerning the “Procedure for Preparation of Notifications of Draft Regulatory 
Documents” mentioned under paragraph 216:  Does this document also regulate the 
notification of technical regulations of provinces of the Russian Federation? 
- Concerning regulatory competencies of the provinces of the Russian Federation: Are 
there any such regulatory competencies in the provinces and for which product sectors do they exist? How is it guaranteed that the regulations of the provinces are based on international standards and cohere nt with the regulations adopted at the 
central level? 
 
214. 218-222 Russia needs to respond in meaningful wa y to the specific concerns raised by 
Members in paragraphs 218-222. - We seek the inclusion in this section of the draft Report meaningful responses the 
concerns raised by Members. 
 
215. 226 and 227 A number of the measures mentioned at paragraphs 226 and 227 and 
elsewhere in the section on Sanitary and Phyto sanitary Measures appear likely to be measures 
covered by the Agreement on Technical Barriers to Trade, as they do not appear to be covered 
by the definitions set out in Annex A of the Agreement on the Application of Sanitary and 
Phytosanitary Measures. 
- We ask that Russia re-examine the SPS and TBT sections of the draft Report to 
clearly differentiate measures falling to the SPS Agreement from those falling to the TBT Agreement and address issues and c oncerns and respond to requests in the 
appropriate place and in re lation to relevant provisions of the Agreements.  
 
- Sanitary and Phytosanitary Measures (paras 224-243) 
 
216. We welcome that this section of the draft Re port does not include a request by Russia for a 
transition period for the implementation of Russi a’s future WTO obligations in relation to 
SPS measures. - We request that Russia press forward with a ra nge reforms in this area to achieve full 
WTO conformity by the date of accession. 
- We seek the inclusion in this section of the draft Report of clear commitments on 
Russia’s part to implement the requirements of the SPS Agreement, including relevant legislative and administrative a rrangements.  Members will need to be 
convinced that the legislative and administrative arrangements will fulfil the 
requirements of the SPS Agreement. 
- We seek appropriate action, the inclusion of relevant information in this section of the 
draft Report and commitments by Russia rega rding adherence to Annexes B and C of  WT/ACC/SPEC/RUS/25/Add.1 
 Page 41 
 
 
 the SPS Agreement and compliance of sub-federal bodies with the provisions of the 
SPS Agreement. 
- We would appreciate advice as to when Russia’s SPS enquiry point will be fully 
operational, when it will provide access to all relevant regulations in a timely manner, 
and what steps Russia is taking to improve its coverage so that traders can be fully 
aware of changes to SPS measures in advan ce of implementation of such changes. 
  These members' views are broadly reflected in paragraph 241 of the draf t report.  We support 
the proposed initiative of a plurilateral mee ting on SPS issues in the margins of the WP 
meeting in mid-June.  These members consider that all relevant legislation and procedures 
must be in compliance with the SPS Agreemen t at the time of accession.  Russia should 
update the WP on its plans to ensure this.  It w ould be helpful to receive a copy of the “Inter-
Agency Programme of Measures to ensure Co mpliance with the Requirements of the WTO 
Agreements on TBT and WTO Agreement on SPS” mentioned in paragraph 211 of the draft 
report, together with an updated SPS Acti on Plan as mentioned in paragraph 242. 
 
 As noted in the Comments on WT/ACC/SPEC /RUS/25, WTO Members should have an 
opportunity to review the list of la ws and regulations referenced in 
WT/ACC/SPEC./RUS/20/Rev.1, but not yet provided for review.   
 
We would appreciate receiving copies of the following
: 
 
- Procedures of Sanitary and Epidemiological  Examination of Products, approved by 
Order No. 217 of the Ministry of Health of Russia on July 20, 1998  
- Resolution of the Russian Federation on State Registration of New Food Products, 
Materials and Items of December 21, 2000, No. 988 
- Resolution of the Russian Federation Government On State Registration of Certain 
Types of Food Products First Imported to th e Territory of the Russian Federation of 
April 4, 2001, No. 262 
- Regulations on the State Veterinary Service of the Russian Federation for Protection 
of the Russian Territory Against Importation of Infectious Animal Diseases from Abroad, approved by Resolution of the Russian Federation Government of October 
29, 1992, No 830 
- Regulations of State Veterinary Surveilla nce in the Russian Federation, approved 
June 19, 1994, No. 706 
- Regulations on the Procedure for Examina tion of Low Quality or Hazardous Food 
Input and Products, Their Use and Destru ctions, September 29, 1997, NO. 1263 
- Regulations on the division of Functions of State Veterinary Surveillance in 
Processing and Storage Enterprises of An imal products, October 14, 1994, No. 13-7-
2/173 
- Instruction on the procedure for issuance  of veterinary accompanying documents for 
cargoes controlled by the State veterinary surveillance agency, April 12, 1997, No. 
13-7-2/871 
- Regulations on State Surveillance and Cont rol in Ensuring Quality and Safety of 
Food products, December 21, 2000, No 987 
- Letter of the Veterinary Department of th e Ministry of Agriculture listing controlled 
cargoes, May 16, 2000, no. 13-8-01/3009 
- Resolution On State Service for Quarantine of Plants in the Russian Federation of 
April 23, 1992, No. 268, and amendments of October 1998 
  No further comments can be provided for the mome nt since the lack of sufficient information 
on these areas, so This member  reserves its right to make further comments in the future. 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 42  
 
 For an evaluation of SPS measures, This member   deems it necessary to be informed by the 
Russian Federation:  a)  For the SPS measures for which an intern ational standard exists and the Russian 
Federation actually applies it, the Russi an Federation shall reaffirm that these 
measures are effectively in conformity with them. 
b)  For SPS measures for which no internationa l standard exists, the risk assessment on 
which the measures are based on shall be provided. 
c)  For the SPS measures for which an interna tional standard exists in CODEX, OIE or 
IPPC, but the Russian Federation applies a higher standard, the Russian Federation shall provide:  (i) the type of SPS measure, (ii) the measure and (iii) the existing 
international standard  (iv) the Adequate  Level of Protection (ALP) established by the 
Russian Federation and v) a description of how their own measures achieve the ALP established and vi) the risk assessment in which the measures are based on. 
d)  This member  would like to have a ll measures relating to products derived from 
modern biotechnology (or genetically modifi ed organisms, GMOs) and its translation 
into English, including those related to labelling. 
 
217. 224 – 243   This member  continues to have concerns that Russia’s current SPS system is not 
consistent with the WTO SPS Agreement.  Our e xperience is that the Russian system lacks 
transparency - new measures are introduced without prior notification and it is difficult to obtain information when requested.  Many of Russia’s SPS measures are not based on 
scientific justification. Additional information,  including an update of its SPS action plan, will 
be necessary to provide a basis to  be satisfied that Russia will be in position to implement and 
enforce the Agreement. This member  expect s a commitment from Russia that they will fully 
apply the WTO SPS Agreement upon accession.  
 
218. 224-239   The Working Party has no specific information on how Russia intends to 
bring its current SPS regime into conformity w ith WTO provisions.  This section of the draft 
WP report does not address this problem, has no re ference to WTO consistency, or any plans 
to move in that direction are included in th e lengthy narrative.  The narrative also avoids 
mention of the active measures currently applied at the border to interdict imports from other 
WTO members in a manner not consistent with WTO provisions.   
 
219. 225   At paragraph 225, Russia notes that confor mity of imported products with hygienic 
standards should be underpinned by a “sanitary-e pidemiological approval" or a "registration 
certificate".  It further notes this represents a "s tatement that a certain type of product is in 
conformity with sanitary legislation".  Furthermore, a hygienic assessment has to be 
"performed, as a rule, prior to delivery of products into the terr itory of the Russian 
Federation". - We request that responses to the following qu estions be included in this section of the 
draft Report: 
- What are the full processes and costs invol ved in obtaining a hygienic assessment, 
and does the requirement of an assessment concern all imported products of animal 
origin? 
- Is a hygienic assessment the least trade-restrictive method of "confirmation that a 
type of product" meets sanitary legislation? 
- Could exporters, instead, check product c onformity against an established list of 
approved products in Russian legislation w ithout the need to obtain a certificate or 
assessment? 
- Furthermore, pre-existing certificates drafted by the Russian Veterinary Department 
(i.e., which cover specific types of products like beef or lamb meat) also imply such 
products must already meet existing hygienic and sanitary       requirements.  Can  WT/ACC/SPEC/RUS/25/Add.1 
 Page 43 
 
 
 Russia, therefore, explain the policy justif ication for both a veterinary health and 
hygiene certificate in such cases?  
 
220. 225   A detailed description is needed for the procedure of hygienic assessment of imported 
products (rules, authorities, documentation, terms, etc.). 
 
221. 226   Which pesticides are allowed or prohib ited? How is the procedure for “State 
registration”? 
 
222. 227   The subfederal entities seem not to have the capacity to enact SPS measures affecting 
importation, distribution or cons umption of imported products. Whic h is their role in respect 
of imported goods? 
 223. 226-227  In paragraphs 226/227, it is stated th at “certain types of products including 
food products imported into the Ru ssian Federation for the first ti me should be subject to state 
registration”. According to Art. 43 of the Fe deral Law No. 52-FZ, a similar requirement does 
not exist for novel food products of domestic origin. Only products which are potentially 
dangerous for man need a state registration if  produced domestically. Since these provisions 
may potentially discriminate between the impor ted and domestically produced food products, 
this issue should be further clarified by Russi a and an explanation provided to justify the 
different treatment between the imported and domestically produced food products. A 
practical example of the “state registration” process should be provided, together with any 
other relevant legislation.  It is also stated that the Ministry of Agricultu re is responsible for the state registration of new 
food products of animal origin. On the other hand, according to Article 14 of the Federal Law No 4676-1 of 14 May 1993, a permission from the Chief Veterinary Officer is required for all 
imports of products of animal origin. Law No 4676-1 does not foresee the state registration of 
imported food products. Russia should clarif y the interrelationship between the state 
registration and the import permits fo r food products of animal origin. 
 
224. 226 and 227 A number of the measures mentioned at paragraphs 226 and 227 and 
elsewhere in the section on Sanitary and Phyto sanitary Measures appear likely to be measures 
covered by the Agreement on Technical Barriers to Trade, as they do not appear to be covered 
by the definitions set out in Annex A of the Agreement on the Application of Sanitary and 
Phytosanitary Measures. - We ask that Russia re-examine the SPS and TBT sections of the draft Report to 
clearly differentiate measures falling to the SPS Agreement from those falling to the 
TBT Agreement and address issues and c oncerns and respond to requests in the 
appropriate place and in rela tion to relevant provisions of the Agreements.   
 225. 227 At paragraph 227, it is stated that a registra tion certificate is issued "for any type of 
products for the whole period of industrial production in the case of Russian products, or the period of supplies in the case of imported products". 
- We request that a response to the following question be included in this section of the 
draft Report: 
- What is meant by "the period of supplies in the case of imported products"?  Does 
this period cover the supply of a consignment,  or current and all future consignments? 
 
226. 230   Could all the implementation measures rela ted to import of products pursuant to Law 
No. 4979-1 of 14/5/93 be tabled? 
 227. 231   It is stated in paragraph 231 that amendments are necessary for the Federal Law No. 
4979-1. Russia should explain these amendments more  in detail.  According to Article 14 of WT/ACC/SPEC/RUS/25/Add.1 
Page 44  
 
 the Federal Law No. 4979-1 all imports of an imals and animal products require an import 
permit from the Chief veterinary Officer. In addition, it is explained that the required 
veterinary certificates are agreed with the veterinary services of each exporting country. It would appear that the actual import conditions ar e laid down either in the import permit or in 
the certificate. In either case, these members are concerned that the Russian system appears to 
lack transparency, coherency and consistency.  The list of goods subject to state veterinary 
control (reference paper 10) in WT/ACC/SPEC/R US/21/Rev.1 is overwhelming.  It includes 
items for which the need for veterinary controls  is difficult to understand, e.g. products of 
purely vegetable origin. Certain products on this list also appear  on the list of goods subject to 
quarantine and phytosanitary control (referenc e paper 11) of the same document indicating 
that the controls are sometimes overlapping. 
 228. 232 In paragraph 232 it is stated that the requirement for pre-shipment inspection of fresh 
meat by the Russian veterinary services in the exporting countries is applied pursuant to the 
OIE Animal Health Code. However, Chapter 1. 2.2 of that Code concerning the certification 
procedures does not recognise a system where officials of importing country sign export 
certificates in the exporting country.  Instead, Artic le 1.2.2.3. of the Code clearly states that 
“Certifying veterinarians should be authori sed by the Veterinary Administration of the 
exporting country  to sign international veterinary certificates”. Therefore, the current system 
of pre-shipment inspection is not in line with  the WTO/SPS principles. We expect Russia to 
abolish this system and rely on the certificates signed by the authorities of the exporting 
countries at latest by the WTO accession. 
 
229. 232   How is the preshipment inspection for m eat carried out? If there is a certificate 
accepted by the RF´s sanitary authority is  this preshipment inspection needed? 
 
230. 232  Regarding paragraph 232, it is mentioned that there is a requirement that exporting 
countries must negotiate a bilateral ag reement on veterinary cooperation. 
- We request that responses to the following qu estions be included in this section of the 
draft Report: 
- What is the legal basis for the "requirement " that exporting countries must negotiate a 
bilateral agreement on veterinary cooperation? 
- What is the necessity for Russian supervis ion of preshipment inspection of raw meat 
products not having undergone thermal treatment?  What steps will Russia take to 
explore whether policy objectives underpinni ng this requirement could be met by 
recognition of the equivalence (Article 4 of the SPS Agreement) of export-country 
inspection methods?  
- We have received advice from Russia that  inspection and certification of individual 
plants is "a usual requirement for exporting countries".   Could Russia specify the legal basis for this requirement, and explai n the circumstances which may trigger the 
need for such inspections (eg disease status) and the scientific justification for this? 
- Furthermore, in light of these "usual re quirements", what steps will Russia take 
towards accepting the equivalence of e xport-country sanitary and phytosanitary 
procedures in this area? 
 231. 235  At paragraph 235, it is stated that transit cargoes "require written authorisation by the 
Chief Veterinary Inspector of the Russian Federation or his/her deputies". - We request that details of this requirement  be included in this section of the draft 
Report, including: 
- the process involved; 
- the criteria upon which a decision is made; 
- how this meets the requirements of Article V of GATT 1994?  WT/ACC/SPEC/RUS/25/Add.1 
 Page 45 
 
 
 - We also request that responses to the follo wing questions be included in this section 
of the draft Report: - Could Russia clarify the nature of "perm its" required for international transit?  
Are these permits required in addition to  the usual veterinary certificates 
required for products transported directly from their place of origin? 
- Could Russia provide an explanation of the policy objective underpinning its 
requirement that the "itinerary of the cargo also has to be agreed"? 
- Do the provisions in mentioned in paragraph 235 also relate to goods 
destined for final sale in Russia?  
 
232. 239   A detailed description is needed for the procedure of phytosanitary requirements, 
certificate and quality of import products  (rules,  authorities, documentation, terms, etc.). 
 233. 239  At paragraph 239 it is stated that "perm its could also be issued by the regional 
inspection authorities of the regions concerned". 
We request that responses to the following qu estions/requests be included in this section of 
the draft Report: - We ask Russia to clarify whether these "perm its" are additional to, or substitutes for, 
permits issued by Rosgoskarantine. 
- Also, are such permits issued by regi onal representatives of federal government 
agencies, or are they developed a nd implemented at a regional level? 
 
234. 240-41  The only mention of issues to be resolved occurs in paras 240-42 where members 
concerns are listed.  We would like to have Ru ssia’s substantive response to the issues raised . 
- We also seek detailed information on the specific improvements it is planning to 
undertake to bring the current system into line with WTO agreements. 
- WTO Members should have an opportunity to review the list of laws and regulations 
referenced in WT/ACC/SPEC./RUS/20/Rev.1,  but not yet provided for review.  The 
list is provided separately. 
 235. 240   We require more information on cu rrently applied phytosanitary measures.  
 
236. 241   We suggest the following modification on the second sentence of para. 241:  
“In practice this could be  fulfilled by achieving compliance with WTO obligations, 
particularly regarding the following principles of the SPS Agreement :   
- base sanitary and phytosanitary measures on scientific evidence, including risk 
assessment; 
- proportionality of measures, by the applica tion of measures not more trade restrictive 
than required to achieve their appr opriate level of protection 
- non discrimination at the adoption or application of the measures 
- equivalence of sanitary and phytos anitary measures (Decision G/SPS/19) 
- transparency (Decision G/SPS/7/Rev.2) 
- as possible, to base sanitary and phytosan itary measures on international standards, 
guidelines or recommendations, when they exist. When there is no international 
standard or when they introduce measures whic h result in a higher level of sanitary 
or phytosanitary protection than would be achieved by measures based on relevant 
international standards, guidelines or reco mmendations, these measures shall be 
based on a transparent and scientific risk assessment. 
- Sanitary regionalisation 
- Acceptance of certificates and other guarantees given by a third country (including 
the European Union) competent authorities as the basis for imports.” 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 46  
 
 237. 242    A detailed description is needed on the in spection procedures and associated charges in 
force in relation to import of poultry meat a nd red meat. Schedule for the update of the 
Russian Federation SPS Action Plan. 
 
- Trade-Related Investment Measures (paras 244-248) 
238. We look forward to Russia’s response to the i ssues raised by members (paragraph 247).  In 
relation to the PSA regime, Russia should iden tify the initiatives it proposes to eliminate the 
regime’s inconsistencies with  relevant WTO obligations.  For sake of completeness, 
paragraph 247 should also describe the elements of the current regime that have given rise to 
concerns as to their consistency with WTO requirements (for example the 70% local content 
requirement under PSA contracts). 
 
239. 244–248:  With reference to P.247, This member  seeks elaboration on Production Sharing 
Agreements in the energy sector.  
 
240. 244  We seek clarification of the status of the sentence in brackets. 
 241. 246  Please provide a description of the provisions of the superceding Government 
Resolution. 
 242. 247  We would appreciate more information on how Russia plans to address the 
commitments it has already made to firms to grant incentives for the production of Autos and 
Aircraft, and for output under the Production Shar ing Arrangements if, as is stated, Russia is 
also committed to eliminating the laws that authorize granting such incentives. 
 
243. 247 We seek the inclusion in this section of the draft Report meaningful responses to the 
requests made and concerns raised  by Members in paragraph 247. 
 
- State-trading Practices (paras 249-255) 
244. The impact on trade of dual energy pricing by Russia’s State Trading Enterprises (STEs) will 
need to be elaborated in the WP report text. 
 
245. 249-250 Russia should list the five entities designated as STEs, and briefly describe 
their activities. 
 246. 250  We understand that, in relation to Alro sa’s sales of raw diamonds for export, 
arrangements are in place that are expressly desi gned to deprive enterprises of Members of an 
opportunity to compete for participation in t hose sales.  This is inconsistent with the 
provisions of Article XVII:1(b) of GATT 1994. - We ask this section of the draft Report include: 
- full details of such arrangements; 
- full details of the range of measure s applied in connection with these 
arrangements and their legal basis; 
- commitments that these arrangements will be eliminated by the date of 
accession and that Russia will not have recourse to them in the future. 
- We assume that the reference in paragra ph 250 to GATT Article XII is an error and 
that GATT Article XVII was intended, and ask that this be rectified. 
- We ask that reference also be made to  the Understanding on the Interpretation of 
Article XVII of GATT 1994, which contains  provisions concerning notification. 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 47 
 
 
 247. 253 and 254  We seek the inclusion in this section of the draft Report responses to the 
requests made and concerns raised by  Members in paragraphs 253 and 254. 
 248. 253   Could the RF specify the contents of the “recent gov. resolution” on licensing? 
- Draft report: In relation to para. 251 at the end of para. 255 following should be 
added: 
“The Representative of the Russian Federation confirmed that the Federal 
Agency for Food Market Regulation, established through Government Resolution No.1224 of 26 September 1997, does not provide any domestic support nor export subsidies in any form”. 
- Could the all the functions of the Federal Agency for Food Market Regulation be 
fully described?  
 249. 254 These members have already outlined their concerns on the operation of Russian 
state-trading enterprises and other enterprises w ith special or exclusive privileges.  These 
should be reflected appropriately in the report, building on what is already in paragraph 254.  
We suggest the following language: 
“Members expected Russia to ensure that  the practices of existing state-trading 
enterprises and other enterprises with speci al or exclusive privileges were brought 
into line with relevant WTO requirements before the date of accession.  Purchases 
and sales by such enterprises, whether state- owned, state-invested or enjoying any 
special advantage or privilege, should be based solely on commercial considerations, 
without any government influence or application of discriminatory measures. 
Some Members were particularly concerne d that the commercial practices followed by 
Russian state-trading enterprises, and in particular Gazprom and Alrosa, could not be said to be based on commercial considerations.  Specifica lly, sales for export were subject to controls 
in relation to quantity and price, and the sale of gas for domestic industrial consumption was 
at price levels considerably below those applie d for export (which are linked to the prevailing 
world market price).  Artificially low domestic energy prices could also lead to indirect subsidisation of downstream industries and to  exports of value-added intermediate and 
finished goods at prices below their normal va lue.  In addition to the significant trade 
distortions caused by this, these Members were concerned that current prices to domestic 
industrial customers could take place at rates that did not ensure "adequate remuneration" 
under Article 14(d) of the Agreement on Subs idies and Countervailing Measures and thus 
would confer a benefit to domestic industrial u sers.  More generally, the current situation 
gave rise to questions as regards its compatibility with WTO requirements, not only in relation to GATT Article XVII, but also in re lation to Article XI and XVI of the GATT and 
the WTO Agreement on Subsidies and Countervailing Measures. 
These Members invited Russia to provide the Wo rking Party with furt her information on the 
operation of these enterprises, particularly as regards the manner in which prices were set for the export of natural gas and diamonds. Russia s hould explain how such sales were the sole 
result of commercial considerations, bearing in mind the strong regulatory framework, the 
wide discrepancy between domestic and export/world market prices for natural gas, the 
application of export duties on gas and th e activity licensing regime for diamonds.” 
 250. 254  Dual pricing of energy should be incl uded in the list of practices of concern. 
 251. 255 paragraph 255: These members consider th at the inclusion of commitment language 
on this  issue, additional to that already found in this paragraph, will be called for in future 
versions of the report. 
 
252. 255  Reference to dual pricing of energy s hould be added to the commitment.  
 WT/ACC/SPEC/RUS/25/Add.1 
Page 48  
 
 - Free Zones and Special Economic Zones (paras 256-263) 
253. 256–263  This member  requests more information on how imported inputs are treated for 
customs purposes when exiting such a zone. 
 
 Russia has described a system where certain sales into the rest of Russia are not subjected to 
tariffs and taxes.  The imported component of goods produced in free zones but eventually 
sold inside the home country should be subject  to normal customs formalities when entering 
the rest of the country, including the application of tariffs and taxes.  How does Russia intend to address this problem? In addition, we seek specific information on th e central issue of whether and the extent to 
which incentives granted to firms establishing in the zones are based on any kind of export 
performance or local content requirements.. 
 254. 257 and 260 The new information on the applica tion of duties and taxes to goods 
produced in the Kaliningrad and Magadan zon es sold in the rest of Russia will require 
additional discussion, as it appears that such app lication is suspended under certain criteria.   
Under these circumstances, th e commitment in para 263 does not conform to the information 
provided, and therefore we seek additional info rmation as to how Russia intends to harmonize 
its practices.  E.g.: - What level of change in commodity classi fication constitutes “sufficient processing?”   
- If no duties are paid on input products pro cessed in the zones and later “exported” to 
other regions of the Russian Federation, this  may be an actionable subsidy subject to 
notification.  
- To what extent are benefits provided in special economic zones contingent upon use 
of domestic rather than imported inputs?   
- To what extent are benefits provided in special economic zones – with the exception 
of custom duty exemptions on imported inputs and final stage sales taxes – contingent 
upon export performance?  
These are critical questions that should be answer ed to determine if such benefits must be 
eliminated prior to accession.  
 
255. 261 and 262 We seek the inclusion in this section of the draft Report responses to the 
questions raised by Members in paragra ph 261 and the proposal in paragraph 262. 
 
- Government Procurement Practices (paras 264-266) 
256. These members invite Russia to update the WP on the existing procurement regime at federal 
and sub-federal level and on the pr eparation of draft legislation in this area.  These members 
expect Russia to make a commitment to ensure  that its public contracting entities will award 
contracts in a transparent manner according to published laws, regulations and guidelines.  A 
consequent commitment to this effect should be envisaged in future drafts. 
 
We suggest the following conse quent additions to the text: 
 
257. 264 insert “in particular on the existing proc urement regime at both federal and sub-
federal levels” at the end of the first sentence;  
258. 265 insert “in particular on the draft Federal Law “On the Purchases and the Deliveries of 
Products for State Needs” at the end of the first sentence; 
 
259. 266 insert “and start negotiations by submitting an offer no later than one year after 
accession” at the end of the first sentence.  In sert “and ensure that by this date, its public  WT/ACC/SPEC/RUS/25/Add.1 
 Page 49 
 
 
 contracting entities would award contracts in a transparent manner according to published 
laws, regulations and guidelines” at the end of the second sentence. 
 260. 264 – 266  Russia indicates that it plans to request  observer status in the Agreement on 
Government Procurement (AGP) at the time of its accession to the WTO. This member  
would encourage Russia to make an offer to b ecome a member of the AGP within a specified 
time period after its accession to the WTO. 
 261. 268 We seek the inclusion in this section of the draft Report meaningful responses to the 
requests made and concerns raised  by members in paragraph 268. 
 
262. 268, 269  Georgian delegation once again would li ke to raise a question concerning the 
transit of goods including those of dual usage.  Regrettably, despite our requests with respect 
to getting clarifications and deta iled description of transit pro cedures and goods of dual usage, 
we did not receive the clear response on that issue as it is mentioned in paragraph 268. 
 
Furthermore, Georgia would welcome unde rtaking clear commitment by the Russian 
Federation with respect to the transit of goods , as it is provided for in paragraph 269 of the 
draft Report. 
 
- Regulation of Trade in Transit (paras 267-269) 
263. The report should reflect concerns already identif ied by these members.  We expect Russia to 
respond to these concerns.  It should specify to the WP how it intends to ensure the 
elimination of current WTO-inconsistent me asures, such as State Customs Committee Order 
number 631 of 27 August 2001.  
 
264. 267-68 We continue to seek provision by Russia of sufficient description of its transit 
policies and practices to confirm whether these are in conformity with th e provisions of WTO 
Agreements, in particular Article V of the GATT 1994.    - Please indicate the circumstances under whic h Russia currently impedes transit of 
other countries’ exports through its territory.  Are there situations where such trade is 
prohibited? 
- We seek more specific information on the charges for transit escort and the reason 
such charges are applied. 
 
265. 268  We seek the inclusion in this section of the draft Report meaningful responses to the 
requests made and concerns raised  by Members in paragraph 268. 
 - Policies Affecting Foreign Trade in Agricultural Products (paras 270-272) 
266. This section will need to be entirely reworked.  Pending other relevant detailed information, 
this section could provide for the time being th e current priorities of the agri-food policy and 
agricultural reform and indicate a need to thoroughly restructure the sector.  It should note that Members encouraged the Russian Federati on to address these priorities by non-distorting 
policy measures that meet the criteria of Annex 2 of the Agreement on Agriculture.  It should 
also note that a comprehensive submission on the Russian Federation’ s agricultural support 
policies was still required in order to establis h the basis for measuring distorting support in 
accordance with WT/ACC/4.  This measureme nt would establish Total AMS commitments 
and outline constituent data and methodology for future measurement in yearly notifications.  
On export subsidies, the views of members will ha ve to be reflected and the issue dealt with 
based on Russia’s comprehensive submission. 
 WT/ACC/SPEC/RUS/25/Add.1 
Page 50  
 
 The reference to the "possible results of the on-going new WTO negotiations on agriculture” 
is not material to the accession.  Russi a’s accession takes place under the present WTO 
agreements.   Annex II mentions only Part I (Goods ) and Part  II (Services) among the Schedules.  It will be 
important at some point also to include Pa rt IV (Agricultural Products:  Commitments 
Limiting Subsidization, including Domes tic Support: Total AMS commitments, with 
reference to supporting tables).  
 
 We would appreciate more information in the WP report concerning Russia’s longer term 
plans for agricultural support and recognition in  the text that Russia will not use export 
subsidies in agriculture after accession. 
 
 Russia will need to respond to Members’ concerns expressed in paragraph 272.  
Commitments will need to be included.  It is prem ature to draft this section of the draft Report 
in advance of agreement being reached on subs tantive issues, including in the plurilateral 
process.  However this section will need to in clude a more complete description of Members’ 
concerns and Russia’s responses, and include a commitment by Russia to the elimination of export subsidies. 
 This member  wishes to inform that, as long as no further information is provided on the 
domestic support policies, it is only in pos ition to comment on the export subsidies by 
submitting a drafting proposal for the draft report of the Working Party: 
 267. 272. Members noted with concern that a comprehensive submission of the Russian 
Federation's agricultural support policies was s till required in order to establish a detailed 
description of the Russian Federation's ag ricultural policies on which appropriate 
commitments could be determined.  Members cons idered that in providing this information 
the Russian Federation should give emphasis on "green box" measures that could achieve the 
desired reform objectives pursued by the Russian Federation in the field of agriculture.  Some 
members further argued that in the current cont ext they considered it inappropriate for any 
country to accede to the WTO with export subs idy commitments.  These members stressed 
the need  that the Russian Federation should
 bind s its export subsidies at zero, since the IVth. 
Ministerial Conference of the WTO has already agreed to eliminate all forms of export subsidies. In this respect, these members also stressed that the disciplines contained in the 
Agreement on Agriculture on export credits, export credit guarantees or insurance programmes need to be applied by the Russian Fe deration so as to avoid circumvention of the 
commitment not to provide export subsidies.  Further, these members underscored the need 
noT to provide export subsidies in any form , including through practices in export state 
trading enterprises or through food aid abuse”. This member  proposes to add “272 bis. Th e Representative of the Russian Federation 
confirmed that the Russian Federation shall not provide any export subsidies as from the date 
of accession and that it shall not circumvent th is commitment in any form, in particular 
through export credits, export credit guarantees or insurance programmes or through state 
trading enterprises or through food aid abuse.” 
 
Domestic Support.
 
 
In respect of domestic support policies, This member  would like to have following 
information: 
 a)  Base period to which the information re fers to (Annexes 1 and 2 of the latest 
document WT/ACC/SPEC/RUS/23 on agricultural support measures does not indicate this).   WT/ACC/SPEC/RUS/25/Add.1 
 Page 51 
 
 
  
In the document WT/ACC/SPEC/RUS/17, Russi a outlines its position as regards agricultural 
domestic support payments, based on factual data on domestic support between 1991 and 
1993.   
Russia considers the 1991-1993 period to be representative for the following reasons:  
 - it is the last triennial period previous to the Federation of Russia's application for 
accession to the GATT and, later, to the WTO (1993 and 1994);  
- during it an intensive process of agricultur al economic reforms began, including the 
identification of the main producer s upport programs, although its implementation 
has been limited by the lack of financ ial resources and the effects of the 1998 
financial turmoil;  
- this period will allow to extend the devel opment of the agricultural sector and will 
contribute to establish fairer cond itions of competition with the main  trade 
representatives  of the Federation of Russia in its domestic market.   
 In the Agreement on Agricultu re, for the calculation of the Aggregate Measurement of 
Support (distorting domestic support), the fixed external reference price is based on the years 1986-1988. We consider that th is should be the base period to be used for the following 
reasons:  
 
- On accession to the WTO, the Federation of  Russia binds itself to the Agreement on 
Agriculture and, in this sense, this Agreem ent states nothing concerning the Members' 
power to change the base period when schedul es are made. (It is irrelevant that the 
Russian accession takes place after the Uruguay Round).  
 
After the Uruguay Round, several countries acceded the World Trade Organization. Ecuador, for example, acceded the WTO in 1995 and, when submitting its first commitment offer, it took into account the years 1986-1988 as domest ic support base period. This offer was 
rejected (despite considering the years 198 6-1988 as base period) and finally the Andean 
country did not adopt commitments in that resp ect. It is not relevant the reason that 1991-
1993 is a representative period since it is the last triennial period previous  to the Federation of 
Russia's application for accession to the GATT and, later, to the WTO (1993 and 1994). Here, it is raised the question of which the base pe riod considered by China when acceding to the 
WTO was.   
It cannot be considered as an argument th e extension and development of the Russian 
agricultural sector for the establishment of the years 1991-1993 as base period. In any case, 
the use of that base period would extend the possibility to grant agricultural production subsidies.   b)  Updated calculation of the value of pr oduction of the products in Annex I of the 
Agreement on Agriculture (AoA). 
 c)  Presentation of the information in the format of G/AG/2, as WT/ACC/4 refers.  d) Green box measures: Identification in the measure of the Russian Federation, which 
authorizes the direct payment or the provision of a service, of the criteria set out in the 
paragraphs 1 to 13 of Annex 2 of the AoA. The absence in a measure of the Russian Federation providing “green box” support of a mandatory provision which prescribes how the 
support will be provided is central for deciding if  the measure will be deemed to be a “green 
box measure”. WT/ACC/SPEC/RUS/25/Add.1 
Page 52  
 
 - Until this information is provided, the dr afting process cannot progress in this area. 
We reserve our right to submit further comments as a result of the assessment of the information This member  hopes to receive. 
 e)  While the Federation of Russia submitted  the list of domestic support programs with 
the description of each measure before the WTO Se cretariat, it is necessary to highlight that 
said list was part of a non official document on "Preliminary Calculation of the Agricultural 
Domestic Support".  - Until this information is provided, the dr afting process cannot progress in this area. 
We reserve our right to submit further comments as a result of the assessment of the 
information This member  hopes to receive. 
 e)  In paragraph 3, page 1, document WT/ACC/SPEC/RUS/23, the critical increase of 
the efficiency of agricultural production is c onsidered as a primary objective of the Amber 
Box measures. We consider that the provision of  production subsidies is inconsistent with the 
term “efficiency” since, in fact, the higher the subsidies are, the lower the efficiency is. On 
the other hand, if the Russian producers were efficient, they would not need subsidies. 
Although this comment is pragmatic, it may be  used as a counter-argument in the Russian 
consolidation of the AMS.   f)  Regulations of the agricultural prod ucts and food market (WT/ACC/SPEC/RUS/23, 
pp. 5 and 6): government procurement interventi ons take place when market prices fall below 
the minimum level or when producers cannot se ll their products due to the decrease of the 
demand; likewise, commodity interventions take place when there is deficit in the market of 
these products or when market prices exceed the fl uctuation limit. Thus, the interventions take 
place as a reaction to minimum or maximum price levels. Government procurement 
interventions are maintained between the minimu m level (intervention level) and the desired 
level, in which the intervention ends.  - We understand that this system would operate  like a kind of system of market price 
support. Which are the fixed external refere nce prices taken into account to establish 
the minimum and maximum trigger levels? Ar e price fluctuations in Russia only due 
to the abrupt variations of the climate conditions?  
 
g)  Input subsidies (WT/ACC/SPEC/RUS/23, p. 7) – Financing for the purchase of seeds and Partial compensation of the costs in whic h agricultural producers incur for the purchase 
of mineral fertilizers and chemical  products for plant protection.  
- When considering said document, it is unders tood that those subsidies are not related 
to certain producers or products. Do the e xpenditures incurred in by the Federation of 
Russia exceed 5% of the value of its total agricultural production?  
 h)  Creation of stockpiles to provide food security (WT/ACC/SPEC/RUS/23, p. 13, para. 2). The government determines the conten t and the volumes of agricultural products that 
should be purchased and food stocks are bought at market prices.  
- It would be convenient to require the Federa tion of Russia to confirm that the sales of 
products belonging to food secur ity stocks will be performed at a price not inferior to 
the average price of the domestic market for the concerned product and quality.  
 i) Insurance programs (WT/ACC/SPEC/RUS/23,  p. 14, para. 4). In 2001, it was 
approved the government Resolution No. 758, da ted on November 1, 2001, on "State support 
to insurance programs in the agro-industrial production." The Ministry of Agriculture is 
creating a federal agency to channel the Stat e support to insurance programs in the agro-
industrial production. The insured sum is determ ined at 70% of the insurable value of the  WT/ACC/SPEC/RUS/25/Add.1 
 Page 53 
 
 
 crops. The insurable value is determined on the b asis of the size of the cropland, the average 
yield of the preceding five years and the fo recasts on market prices. Insurance premium 
subsidies that agricultural companies have to pay according to their contracts with insurance 
companies are granted. Agricultural producers pay 50% with their own resources and the remaining 50% is paid with funds charged to the Federal Budget.  
- We consider that this measure would not meet the requirements of Annex II of the 
Agreement on Agriculture so as to be incl uded in the Green Box. In this respect, 
paragraph 7 of said annex (government fi nancial share in income insurance and 
income safety-net programs) provides for the fundamental requirement that there 
should be a loss in the average gross income or its equivalent in terms of net income 
corresponding to the previous triennium in order to receive the payments. If the 
insurance premium is subsidised, the loss of  30% or more in terms of incomes is 
uncertain; in practice, this resulted in th e provision of support to producers that faced 
no income decrease at all.  
 
- Trade in Civil Aircraft (paras 273-274) 
268. 273-74 We would appreciate Russia’s report on its efforts to negotiate additional market 
access in Russia for aircraft.  We support a co mmitment by Russia to join the Agreement on 
Trade in Civil Aircraft upon accession. 
 
- Textiles (paras 275-276)  
269. 266  The purpose of this paragraph is not to fu rther restrict Russia’s textile exports after 
accession.  Rather it is intended to ensure that  the starting point for the MFA liberalization 
schedule for Russia’s textile exports is consistent with the terms of its bilateral agreements at 
the time of accession, i.e., that  the quantities provided for in these agreements become the 
starting points for the liberalizations pr ovided for in the MFA phase out schedule. 
- We seek a commitment to that effect based  on the language in this paragraph. 
 
TRADE-RELATED INTELLECTUAL PROPERTY REGIME (TRIPS) 
General (paras 277-281) 
270. These members consider that the section deali ng with TRIPS issues needs to be expanded 
further so as to provide a firm er basis for an assessment of current TRIPS deficiencies and the 
work in hand by Russia to ensure TRIPS co mpliance by the time of accession to WTO.  The 
report does not give sufficient detail to allow for a meaningful assessment of TRIPS compliance.  Repeated statements that new la ws and amendments to existing laws will be 
sufficient to make Russia’s IPR legislation TR IPS-compliant need to be backed up with a 
detailed explanation of existing shortcomings, a description of new legislative initiatives and 
an identification of the provisions which are intended to address specific TRIPS 
shortcomings.  Otherwise, no assessment of the actual TRIPS compliance of the proposed changes can be possible.  The report should also specify the time frames foreseen for the 
adoption of the new laws and amendments which are referred to.  Until these laws have been 
adopted and examined, it is difficult to confirm th at they will indeed be  sufficient to ensure 
TRIPS compliance.  Accordingly, we invite  Russia to make detailed information on these 
legislative initiatives available to the WP, toge ther with the actual texts as soon as these can 
be provided. 
 
271. 277 – 303   This member  supports calls for more  information in this area and shares  
concerns about the treatment of IP in the Ru ssian Civil Code which will make enforcement 
difficult.  We look forward to seeing the draft le gislation which is under consideration in the WT/ACC/SPEC/RUS/25/Add.1 
Page 54  
 
 Russian parliament and we are encouraged to  hear that enforcement has been greatly 
enhanced in the last year.  
 
272. General Comments
:   The WP report text in this section is very general and does not provide a 
clear picture of the way in which the obligati ons of the TRIPS Agreement are met or will be 
met by the Russian Federation.   
In addition, there should be a section iden tifying the international intellectual property 
agreements to which the Russian Federation be longs and the government agency or agencies 
responsible for all the various functions rela ted to TRIPS obligations should be identified 
expressly.  Russia should also provide information throughout on the status of the pending 
legislation.   
The text should also reflect the views of Me mbers on the WTO consistency of  Russia’s IPR 
regime and on the parts that should be am ended to meet the provisions of the WTO 
Agreement on TRIPS.   In particular, it should reflect Member’s views on the adequacy, or lack thereof, of Russian 
arrangements for enforcement.  The treatment of  enforcement is particularly problematic as 
we are working bilaterally on these issues and none  of the problems we have jointly identified 
or discussed are addressed.  
  We seek copies of English translations of Russia’s legislation which implements its TRIPS 
obligations, both with respect to intell ectual property protection and enforcement.  
 
The TRIPS Agreement allows Members some discretion in the measures that are implemented.  For example, Article 27(3)  provides exclusions from patentability. 
 - What exclusions from patentability will Russia be applying? 
 
While Russia has commented on the legal provisions that will be in place to combat infringements of intellectual property rights, these provisions will only be effective if the 
owners of intellectual property rights and th e public are aware of the intellectual property 
system and those rights.  
- We ask Russia to provide information on  what action, and when, the Russian 
authorities will be taking to increase awaren ess of intellectual property rights among 
the public, the judiciary, education and r esearch institutions, industry and businesses. 
 We have become aware of an issue regarding Russia’s trade marks system that we would like 
to raise.  The issue concerns how Russia ha ndles well known or famous trade marks, and we 
are providing separately a copy of an article which sets out the problem.  - We would like to know what Russia will do to prevent the misuse of well-known 
marks as described in this article.  We feel  that Russia should not rely upon a slow, 
expensive and dubious legal system to re medy the problem (and please note that the 
remedy to the problem proposed in the article is not satisfactory). 
 WTO Members are bound by the provisions of the TRIPS Agreement which subject their pharmaceutical industries to 20 years of patent protection.  We would expect this minimum 
patent protection to be implemented by Russia. 
 
- Will Russia subject its pharmaceutical industry to a term of patent protection of not 
less than 20 years? 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 55 
 
 
 273. 279   Does Russia intend to seek any special  arrangement regarding an exception from 
MFN treatment for the Eurasian Patent Conventi on.  Since it appears to have entered into 
force in August of 1995, i.e., after the date of en try into force of the WTO Agreement.  As the 
exemptions provided for in Article 4 would no t seem to apply to this case, Russia should be 
prepared to extend MFN treatment upon accession or seek an exception. 
 - Copyright and Related Rights (para 282) 
274. One area in which the Russian copyright law is not yet TRIPs compliant is that of retroactive 
protection of foreign works and foreign s ound recordings. The WP report (paragraph 282) 
states that “new amendments to the copyright law would bring the provisions relating to 
retroactive protection into conformity with  the respective requirements of the Berne 
Convention and the WTO Agreement on TRIPs”.  Can Russia explain, by reference to these 
proposed amendments, how the existing incons istencies with TRIPS requirements will be 
eliminated?  
 
275. 282  Please describe the way in which related right s obligations of Article 14 of the TRIPS 
Agreement will be met, with particular atten tion to the requirements of Article 14.4 and 14.6 
because these rights are not dealt with by the Berne Convention. 
 
276. 282 The paragraph does not bring enough information to evaluate compliance of Russian 
legislation with the TRIPs Agreement.  In particular, it would be useful to know:  
- Does Russian legislation provide authors and their successors rental rights?  
- Which are the terms of protection in this category of intellectual property rights? 
 
- Trademarks, including Service Marks (para 283) 
277. In order to fully address and assess the current legal situation of trademark protection in 
Russia in the light of the TRIPs Agreement, it would be indispensable to receive an English 
version of the 1992 Federal Law N0. 352 0-FZ with subsequent amendments.  
 
These members have the following specific comments and questions in this area: 
 
Russian law does currently not provide for th e protection of well-known trademarks. Please 
explain how the Russian Law will comply with the provisions of Article 16.2 and 16.3 TRIPs. 
How will Russia qualify a "well-known mark"? Will it follow the recommendations set forth 
by the Joint Recommendation concerning Provis ions on the Protection of Well-Known Marks 
adopted by the Assembly of the Paris Union fo r the Protection of Industrial Property and the 
General Assembly of the World Intellect ual Property Organisation (WIPO) at the 
Thirty-Fourth Series of Meetings of the Assemblies of the Member States of WIPO 
September 20 to 29, 1999? Please confirm that, in order to benefit from protection, well-known marks will not need to be registered in Russia. Please specify whether, in order to benefit from a protection in Russia, a well-known mark  will have to be used in said territory.  
 What signs precisely are eligible for regi stration as trade marks under the Russian Law 
(Article 15 TRIPs)? Are single colours (or only combinations of colours) protectable? May 
registration be acquired for sound and sm ell marks? If so, under which conditions? 
(dependent on distinctiven ess acquired through use?). 
 Please explain how the Russian Law on Trade Marks complies with Article 15.5 TRIPs. Does 
Russia afford the opportunity for regi stration of trade marks to be opposed
 by earlier trade 
mark holders? On what kind of earlier rights may a petition to cancel  a registration be filed?  
 WT/ACC/SPEC/RUS/25/Add.1 
Page 56  
 
 The Russian Law on Trade Marks provides that a registered trade mark may be cancelled on 
request of a third party in case the owner has not used his trade mark without legitimate 
reasons for 5 consecutive years. This is in conformity with Article 19 of the TRIPs Agreement. Question:
 What happens in cases when the owner did not use his trade mark for 
an uninterrupted period of 5 years and such non-use was never challenged by a third party? 
Can it then be challenged subsequently? Will resu med use after 5 years lead to revival of the 
exclusive trade mark rights with no further possi bility for a third party to claim its revocation 
for non-use?  How does Russia meet the terms of Article 23 TRIPs? Does the Russian Trade Mark Law 
provides that trade marks containing geographical indications will be rejected ex officio  when 
such marks designate wines and spirits, regardless whether they are misleading or not? 
 
278. 283  Please provide additional specific information on how Russia protects well known 
marks under existing law.   
- We reserve the right to return to this issue with specific examples of problems 
experienced by trademark holders under current law.  
 
- Geographical Indications, Including Appellations of Origin (paras 284-285) 
279. The TRIPs Agreement does not establish any sub- categories of “geographical indications”. 
So, what does that mean the title of this Sec tion? Which others sub-categories are suppose to 
be included under the category “geographical indications”?   
- This member  asks for the deletion of words “Including Appellations of Origin ”, 
included in the title of this section.  Th e categories of Intellectual Property Rights 
should be mention in the same way as in the TRIPs Agreement.  
- Please indicate if for the Russian Federa tion legislation “indication of source” is 
“geographical indications”  in terms of the definition provided in Art. 22.1. of TRIPs 
Agreement. 
- Is the Russia Federation part of any mu ltilateral of bilateral agreement related 
specifically to Geographical Indications? 
 280. 284 This paragraph indicates that since 1992 , “one highly important category of 
geographical indications -appellations of orig in- was accorded special protection”. Could 
please the Russian Federation indicates:  - Which is/are the other/s “less important categories of geographical indications”?  
- Under which base the Russian Federation establishes different categories of 
“geographical indications”? 
- In the opinion of the Russian Federation, the totality of this so considered “sub-
categories of geographical indications” (appare ntly included in his legislation) are in 
conformity with definition provided for Art. 22.1. of TRIPs Agreement?  
- Which categories of products are actually protected by geographical indications and 
registrable in the state register? Does the system of “state registration” provide national treatment? 
 
281. 284, 285  Georgian delegation welcomes worki ng out by Russian Government of 
amendments to the Federal Law of 1992 "On Trademarks, Services Marks and Appellations 
of Origin" which, in our opinion, gives an additional protection to geographical indications for wines and spirits. 
- According to information available to us, the Russian side has intensified the work 
for developing the common register of ge ographical indications within the CIS, 
which is in full line with decisions of the WTO Doha Ministerial Conference.  We certainly welcome these positive steps wh ile wondering if the Russian delegation  WT/ACC/SPEC/RUS/25/Add.1 
 Page 57 
 
 
 could provide us with some detailed info rmation about passing of the CIS Agreement 
on Creation of Common Register of Geographical Indications in the State Duma. 
- Besides, we would appreciate if this point will be duly reflected in the draft Report. 
 282. 285  Please explain more in detail what the draft law and amendments to Federal Law Nª 
3520-FZ of 23 September 1992, would exactly provi de in relation to geographical indications 
identifying wines and spirits.  - Which would be the main difference in  relation to the actual protection to 
geographical indications identifying win es- spirits and other products?   
- Please indicate if National Treatment and Most-Favoured-Nation Treatment would be 
granted.  
- Does the draft law and amendments include a disposition related to Art. 23.4 of 
TRIPs Agreement?. 
 
283. 285 This paragraph states that Russia’s draft law amending the current legislation, i.e., 
Law No. 3520-FZ of 23 September 1992 "On Trad emarks, Service Marks and Appellations of 
Origin" would “take into account
 (emphasis added) the provisions of the WTO Agreement on 
TRIPS relating to additional protection of geogr aphical indications for wines and spirits and 
extended only for the appellations of origin wh ich were registered in accordance with the 
established procedure.”  This phrase is used in  subsequent references to new legislation. 
- It is not clear that the phrase “take in to account” means the same thing as “bring 
Russian law into conformity with.”  All WTO members must bring their laws, 
regulations and other measures into conform ity with TRIPS requirements, not simply 
“take into account” its provisions.  Russia’s description of its draft legislation does not clearly state this.   
-
 We seek detailed information on how this a nd other IPR-related legislation will bring 
Russia into compliance with TRIPS, in the area of Trademarks and in other areas.  
 
- Inventions and Industrial Designs (para 286) 
284. 286 We note the same issue with the statement that the draft revisions will “take into 
account” the provisions of the TRIPS Agreement.   We are seeking additional certainty and 
details on how the draft amendment will bring Russia’s laws into compliance with TRIPS 
requirement.   
 
- Plant Variety and Animal Breed Protection (para 287) 
285. No comments. 
 - Layout Designs of Integrated Circuits (para 288) 
286. 288 This paragraph also uses the phrase “take into account” and raises the same issues 
relating to certainty about compliance and the n eed for detailed information to determine if 
the draft legislation will bring Russia into compliance.  
- We reserve the right to make further comments after reviewing the draft legislation. 
 - Requirements on undisclosed information, in cluding trade secrets and test data (para 
289) 
287. Please describe how the Russian Law meets the requirement of Article 39.3 TRIPs 
Agreement stating that Members shall protect undisclosed test or other data which is submitted as a condition of approving the marketing of pharmaceutical or of agricultural 
products against unfair commercial use. Does your legislation prevent the regulatory authority
 WT/ACC/SPEC/RUS/25/Add.1 
Page 58  
 
 itself from relying on original test data for approving bio-equivalent products that are 
submitted by a generic manufacturer? And, if so, what is the period of time? Patents
 
- The information provided by the report on patents is rather scarce. A more detailed 
description of the patent law and its current  legislative status (i.e. whether it is 
adopted yet or, if not, when this might be th e case) is desirable before any meaningful 
assessment of its TRIPs compliance can be made.   
- How does Russia intend to implement Artic le 39.3 of the TRIPs Agreement on the 
protection of test data for pharmaceu tical and agro-chemical products?  
 
288. 289  In addition, we seek a detailed description of the way in which data submitted to the 
Russian government to obtain marketing approval for pharmaceuticals and agricultural chemicals is protected against unfair commercia l use, and a specific commitment from Russia 
on this issue.  We are seeking information,  for example, on which products qualify, the 
duration of such protection, and the treatment  accorded others seeking to obtain marketing 
approval for the same product.  
 
289. re:  Enforcement - Concerning para 289 Please provide information on how the 
relevant ministries in Russia coordinate to en sure that marketing approvals are provided and 
used prior to expiration of a patent? 
 
- Enforcement 
 - Criminal Measures (paras 290-291) 
290. 290  We believe this description should be elabor ated with a description of the activities of 
the special department since 1999 – including appropriate statistics. 
 
291. re:  Enforcement - Concerning para 290  
- Please describe when illegal use of objects of copyright or neighboring rights under 
Article 146 of the Criminal Code tr iggers a criminal investigation. 
- Please describe the types of cases that warrant criminal prosecution under Article 180 
involving trademark infringement. 
- Please provide details of the approved draft amendment to Article 180 of the Criminal 
Code addressing organized crime, in itial conspiracy and imprisonment. 
 
292. 291  Does the term “intellectual property violation cases” mean police seizures or 
prosecutions; if the former, please indicate how many of those cases were prosecuted; of 
prosecuted cases, how many resulted in the imposition of fines and the average fine; how 
many resulted in prison terms and the average period of imprisonment.  
  
- Regarding confiscation, could information be supplied on how many cases resulted in 
the right holder requesting transfer of the goods; how many cases resulted in the 
Court ordering destruction of the goods?   
- We would also like to have some idea of the nature of the products seized– are they 
optical media, software, videos, sound recordings, counterfeit trademarked goods 
- This paragraph is unbalanced in its treatm ent of current enforcement problems.  We 
regret to report that the Russia has become a major exporter of pirated intellectual property, particularly in the area of optical media such as compact audio and video 
discs.   
- We seek more information from Russia on how  the revisions to the Customs Code are 
intended to address the problem.    WT/ACC/SPEC/RUS/25/Add.1 
 Page 59 
 
 
 - We also seek reflection of this in the draft Working Party report and action from 
Russia to pass specific legislation to address this problem, noted in a commitment the 
WP report text. 
- We understand that the current draft that will soon have its second reading in the 
Duma has been heavily amended.  We would appreciate assistance from Russia in 
obtaining copies of the relevant portions of the text so that we may verify the scope 
and substance of the provisions  dealing with these problems.  
 
293. re:  Enforcement - Concerning  para 291:  
- Article 61 of TRIPS provides that criminal pe nalties are to be applied at least in cases 
of willful trademark counterfeiting or copyright piracy on a commercial scale.  Please 
describe how the determination is made whet her a violation is on a commercial scale.  
Please describe how determination is made  that violation resulted in “significant 
damage”. 
- Article 61 provides that remedies availa ble shall include imprisonment and/or 
monetary fines sufficient to provide a de terrent, consistently with the level of 
penalties applied for crimes of a corres ponding gravity.  Please describe the number 
and range of monetary penalties issued last year and the number of cases in which jail 
time was given and the lengths of imprisonment.  Is there a range of the level of penalties and jail time the courts use?  Please describe the amount of criminal fines that have been imposed within the last  year under Article 146.Please describe the 
number of prison sentences issued under Artic le 146 and the lengths of imprisonment 
- Please describe the number of cases in which criminal fines were assessed under 
Article 180 involving trademark infringement within the last year and the amount of fines assessed. 
- Article 61 provides that in appropriate cases, remedies available shall also include the 
seizure, forfeiture and destruction of the infringing goods and of any materials and  
implements the predominant use of which has been in the commission of the offense.  
Please describe the number of criminal cases in which the goods were seized, forfeited and destroyed and cases in which the materials and implements used were seized, forfeited and destroyed.  Is seizure  of goods and material s and implements at 
the discretion of the court? 
  - Criminal Procedure (paras 292-293) 
294. 292  Please identify the enforcement bodies and describe their general responsibilities. 
 295. re:  Enforcement - Concerning para 292: 
- Must a complaint be filed by a right holder in order to initiate a criminal 
investigation? 
- Please describe the jurisdiction of government  agencies in investigating intellectual 
property crimes. 
 296. 293  We would appreciate more details on the issues  covered in this section, in the form of 
statistics to demonstrate Russia’s efforts toward s criminal enforcement, and more information 
on changes Russia is prepared to make to  improve the currently somewhat negative 
enforcement situation. 
 
 - Administrative Matters (paras 294-295) 
297. 294  We understand that Russia intends to m odify the threshold described in this 
paragraph so that it is easier to meet.  How does Russia intend to do this? WT/ACC/SPEC/RUS/25/Add.1 
Page 60  
 
 - We would also appreciate some statistics on the activities of the Ministry of Anti-
monopoly Policy and Entrepreneurship Supp ort in initiating proceedings against 
offenders, decisions imposing fines and prohibiting infringing actions.  
 
298. re:  Enforcement - Concerning para 294: 
- Please describe the minimum and maximum administrative sanction fines and under 
which law/article are these imposed. 
 
299. re:  Enforcement - Concerning para 295: 
- Please describe the number of determinations made by the Ministry of Anti-
Monopoly Policy and Entrepreneurship Support involving intellectual property 
violations.  Please describe the procedures under which a right holder may file a claim.   
- Article 49 of TRIPS provides that to the extent that any civil remedy can be ordered 
as a result of administrative procedures on the merits of a case, such procedures shall 
conform to principles equivalent to those set forth in section 2 of Part II of TRIPS.  
Please describe how the administrative proce dures in the above ministry comply with 
Article 49. 
 
- Border Measures (paras 296-298) 
300. 296-298  Please provide statistical information on how many rightholders' applications 
for Customs' measures have been accepted by the SCC since 1998.   
- What is the status of provisions in the new draft Customs Code that will allow the 
SCC to act fully in accordance with the WTO TRIPS standards in terms of supplying the right holder as a third party with information and of providing the right holder with an opportunity to inspect detained goods and take samples?  
 
301. re:  Enforcement - Concerning para 296: 
- Please identify the number of right holders applications for Customs measures that 
are currently filed with the State Customs Committee.   
- Please identify the number of cases and disposition (seizure of 
goods/fines/imprisonment) relating to actions  based on applications filed by right 
holders. 
 302. re:  Enforcement - Concerning para 297: 
- Please describe how the draft new Customs Code complies with the provisions in 
Article 57 of TRIPS relating to right of in spection and information.  Under the draft 
code, what information may be supplied to the right holder? 
 303. re:  Enforcement - Concerning para 298: 
- Please describe the type of information rela ting to the importer that may be provided 
to a right holder under TRIPS Article  
 - Civil Law Remedies and Procedure (paras 299-303) 
 
304. re:  Enforcement - Concerning para 299: 
- Please identify the particular articles under th e Civil Code that address the remedies 
referenced in this paragraph. 
  WT/ACC/SPEC/RUS/25/Add.1 
 Page 61 
 
 
 305. re:  Enforcement - Concerning para 300: 
- Please provide an overview of damages that ha ve been awarded by courts relating to 
civil infringement cases within  the last year.  Please iden tify cases in which statutory 
damages have been awarded by courts and the amounts. 
 
306. re:  Enforcement - Concerning para 301: 
- With regard to provisional measures, pl ease describe how readily available these 
measures are to rights holders  If a claim mu st currently first be filed in order to 
obtain provisional measures are measures Ina udita altera parte pursuant to TRIPS 
Article 50 available? 
- Please describe the frequency with which destruction of infringing goods and 
materials and implements are orde red fro destruction by courts. 
- Please describe the frequency in which prope rty including bank accounts are arrested 
within a civil proceeding.  Is this pro cedure available in criminal prosecutions? 
- Please describe how the draft amendments to the Code of Arbitration and Procedure 
provide for provisional measures to be obta ined prior to the filing of the claim. 
 307. 303  We support the thrust of the concerns raised  in this paragraph.  We would like Russia 
to indicate in specific terms how current de ficiencies in Russia’s intellectual property 
protection regime will be remedied. 
 
- We also seek a commitment from Russia that it will avoid enacting competing 
provisions in the Russian Civil Code, provisions will create confusion with the regular legislation and will make changi ng the laws to keep up with changing 
technology extremely difficult.   
- We seek reference to the views of Members in the WP report text noting their views 
that establishment of IPR protection in Civ il Code would be harmful to the protection 
of intellectual property rights and to the Russian economy.  
-
 We also seek confirmation that Russia h as established, or will do so prior to 
accession, coordination between authorities issuing marketing approvals for pharmaceuticals and those responsible for granting patent protection. 
 
308. 303   In Para 303 the representative of the Russian Federation has confirmed that its 
country would provide effective protection agai nst unfair commercial use of undisclosed test 
or other data for a period of at least six year s from the date of marketing approval. Could you 
please confirm if the six-year protection prohibits a second applicant from relying on, or from referring to the original data of the first app licant, when applying s ubsequently for market 
authorisation for a similar product.  
 309. 303 This member  welcomes the confirmation made by the Russian Federation in the 
sense it would apply fully the provisions of the TRIPs Agreement from the date of accession 
to the WTO.  Nevertheless, it has to be noted that Art. 39 does not establish that a period of time of 
protection would have to be granted at national le vel to consider that “effective protection” is 
provided to undisclosed information. As no peri od of time has to be establish at national level 
to comply with Art. 39,  This member  asks for the deletion of the words “in compliance with 
Article 39 of the TRIPs Agreement” , included in the second sentence of paragraph 303 in the 
Draft Report of the Working Party on the Accessi on of the Russian Federation to the WTO. 
This member  understands that the Russian Federation is free to assume “TRIPs- plus” 
obligations or compromises, but this kind of  unilateral compromises should not be reflected 
as to incorrectly interpret any TRIPs Agreement provisions.  
 WT/ACC/SPEC/RUS/25/Add.1 
Page 62  
 
 TRADE-RELATED SERVICES REGIME 
- Policies Affecting Trade in Services (paras 304-319) 
310. The issues earlier raised by these member are broadly reflected in paragraph 319 of the draft 
report.  In light of the discussion on 24/25 April, these members consider it appropriate that additional language on Financial Services should also be incorporated in the draft following 
the present paragraph 319:   
 “Regarding the banking sector, some members expressed concern that the two largest commercial banks in the Russian Federa tion (Sberbank and Vneshtorgbank) were 
currently owned by the Russian Central Bank (CBR).  Taken together these two banks held a dominant position on the Russi an market and their ownership by the 
CBR created a clear potential conflict of interest with the Central Bank’s prudential 
and other tasks. While welcoming inform ation by Russian Federation on plans to 
divest the CBR holdings in commercial banks, these members invited the Russian Federation to indicate a firm date by when  the ownership of these banks and their 
commercial activities would be legally a nd in practice separated from the CBR. 
- In addition, these members expressed concer n about the distortions of competition 
created by the unlimited (i.e. 100%) state gua rantee given to deposits in accounts held 
with the state-owned Sberbank. No state gua rantee at all existed for deposits held in 
accounts with other banks, whether Russian or foreign. These members expected the 
Russian Federation to make a commitment by which deposit guarantees would be granted in a non-discriminatory way to a ll account holders irrespective of the bank 
they choose, and under the same conditions and up to the same deposited sums. These 
Members were of the view that this w ould foster equal conditions of competition 
between different banks operating in Russia,  and would help improve the solidity and 
functioning of the financial sector more generally. 
- These members commended the Russian Fe deration on the reform proposals that 
were being considered towards the creati on of a deposit insurance scheme, although 
they had concerns about the length of tim e for implementation suggested in certain 
proposals, the low figure for guaranteed de posits (equivalent to around $650) and the 
continuation of the preferential position cu rrently enjoyed by Sberbank, which was 
contrary to WTO principles of non-discr imination and should be ended on accession. 
They invited the Russian Federation to submit more detailed information on these 
proposals, including on their implementation date, as well as to demonstrate the 
equivalence of guarantees for deposits with the Sberbank and other banks.” 
- The report could also usefully include a description of existing prudential 
requirements governing the financial services sector, together with relevant legislation. 
- These members expected Russia to make commitments to (a) divest or bring under 
the responsibility of another branch of government the commercial activities of the 
Central Bank of Russia (CBR) and (b) to ensure that there is no discrimination between established banks as regards the guarantee of deposits. Both these steps 
should be completed by an agreed deadline. 
- The issue of International Accounting Sta ndards (addressed in paragraph 318 of the 
report) is not relevant solely to trade in services.  We would therefore suggest that 
this paragraph be moved to an a ppropriate section of the report. 
 
311. 304 – 319 The current services text in the Work ing Party report is unbalanced and 
requires further work. This member  join s others in expressing concern about the 
transposition of certain horizontal limitations fro m the Russian schedule of commitments into 
the services section of the Working Party repor t. We do not support language in the Working 
Party report that could allow Russia to apply saf eguards in the area of services. In addition to  WT/ACC/SPEC/RUS/25/Add.1 
 Page 63 
 
 
 these concerns, This member  feels that th e Russian definition of a natural monopoly as 
outlined in footnote 8 to the Working Party re port is too broad and potentially excludes 
sectors where commercial provision of services is important. We share concerns about current restrictions in the banking sector and specifically  the fact that two of the largest banks in 
Russia (Sperbank and Commercial Bank) are owne d by the Russian Central Bank. We look 
forward to receiving the non-paper on various i ssues raised in the Working Party report by the 
next Working Party meeting in June.  
 
 As we noted in April, this section of th e draft WP report needs work and is, overall, 
unbalanced. 
In general, there is no voice for the Members in  the early paragraphs.  Russia’s statements, 
many of which are problematic from the st andpoint of Members’ positions, go without a 
parallel statement that would bring the needed balance.   A serious case in point is the definition and u se of the concept of “natural monopolies” in this 
section. 
The comments included in paras 316-319 represent only a fraction of the statements made by 
delegations on this topic. In addition, in several instances,  as noted specifically below, Russia appears to be attempting 
to use the Working Party report to introdu ce restrictions on trade in services.   
 312. 305  We request deletion of this paragraph, which contemplates a safeguards regime for 
services.  The issue of safeguards in the services context is one on which WTO Members 
have not yet reached consensus; the matter is under discussion in the Working Party on GATS Rules.  
 313. 305 Russia has used the infant industry argument in order to justify protecting its services 
sector. 
- How will Russia go about this? 
- If Russia seeks to use safeguards measures as it hints, then how will this be 
reconciled with the absence of any safeguards mechanism in the GATS?  
 314. 306  It is encouraging that Russia has embarked upon a “series of measures to reduce red 
tape restraints on the economy, involving streamlining of the procedures of company 
registration, down-sizing the list of types of ac tivities subject to licensing and the reduction of 
frequency of inspections of enterprises”.   We are very keen to see the removal of many of the layers of licensing, inspection and approvals pr ocesses, and the introduction of less restrictive 
requirements.  We understand that in the constr uction sector, services suppliers are subject to: 
- multiple approvals for each single aspect of their operation; 
- approvals that are not based on any tangible policy rationale; 
- procedural requirements that provide opportunities for rent seeking by 
officials; 
- inconsistencies in approval requireme nts and procedures over time and in 
different parts of Russia. 
- How will Russia’s new legislative acts concer ning “debureaucratisation” ensure that 
domestic regulations concerning constr uction-related activity are no more 
burdensome than necessary to ensure the qua lity of the service and will not constitute 
unnecessary barriers to trade in services. 
- Will these new laws establish any princi ples for the administration of such 
regulations, in particular to ensure cons istency of implementation in all parts of 
Russia? 
- What legal procedures will be available to  service suppliers who wish to appeal 
against administrative decisions? WT/ACC/SPEC/RUS/25/Add.1 
Page 64  
 
 - Can Russia describe the nature of domestic  regulation affecting the construction 
industry?  Are regulatory measures part of  Federal or regional law?  Does Russia 
intend to ensure, when framing its laws, that regional and Fe deral measures do not 
overlap and are no more burdensome than necessary? 
 
315. 307  This paragraph is not necessary and it should be removed.  As a WTO Member, 
Russia will be expected to adhere to the results  of the debate on subsidies; it is not necessary 
to say so here. 
 316. 307  Russia is insisting that it maintain its s ubsidies to domestic service providers, the bulk 
of which go to large service providers such as Rostelekom, Ingostrakh, Aeroflot, etc. 
- We seek the inclusion in this section of  the draft Report of the following: 
- detailed factual information on the typ es and levels of subsidies currently 
provided; 
- Russia’s intentions in respect of are as currently not receiving any subsidies; 
and 
- an undertaking by Russia to phase out its system of subsidies. 
 317. 308 Russia has made no commitments on the provision of mining, oil drilling and pipeline 
services. - We seek the inclusion in this section of  the draft Report of the following: 
- details of the relationship, if any, between the lack of any commitments on 
the provision of mining, oil drilling and pipeline services, and the exercise of Russia’s sovereign rights over its subsoil and mineral and energy resources; 
- Russia’s intentions in respect of the de velopment of a market environment in 
relation to the provision of mining, oil drilling and pipeline services, and 
whether these are consistent with the role that it sees for the conclusion of 
production sharing and concession arrang ements (we see the latter aspects as 
fundamentally inconsistent with transition from the command economy to a market economy). 
 
318. 309  The last sentence of this paragraph, relating to state procurement and services 
purchased for governmental purposes, is not necessary and it should be removed.  
 319. 311  We request removal of this paragraph, or its  substantial modification.  As written, it is 
by no means clear which servi ces sectors Russia considers to be natural monopolies, nor is it 
clear how such determinations might be made.  Absent clarification, this paragraph should be 
removed from the report. 
 320. 312  We request removal of this paragraph.  As written, it is too vague and would appear 
to reserve for Russia the right to declare virtually any service sector a public utility and to derogate from the specific commitments in its schedule.   
 
321. 313  We request revision of this paragraph.  We understand Russia’s interest in protecting 
its cultural heritage, but this provision is too broadly and vaguely worded.  Please provide 
more specific definitions of what is meant by  “a juridical person . . related to the cultural 
heritage . . . and/or being a cultural property of the Russian Federation.”  Please also provide 
more specific explanations of what cons titutes “specially protected territories.”   
 
322. 314
 Please provide more detail as to who specifically are the “indigenous persons and 
exiguous ethnic communities” referred to in this paragraph.   
  WT/ACC/SPEC/RUS/25/Add.1 
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 323. 315  This paragraph is not necessary and should  be removed.  GATS treatment of national 
security issues is clearly spelled out and does not need to be re-stated here.   
 324. 316-319   We seek Russia’s substantive respon se to the concerns raised in these 
paragraphs.   
 
325. 316-319  We ask Russia to respond in a mean ingful way to the requests made and 
concerns raised by Member s in paragraphs 316-319. 
 326. 318 bis  A Member expressed concern over the current regulations of the Bank of 
Russia regarding qualification of certain countries as off-shore zones and other discriminatory 
measures in banking.  This Member asked to br ing these regulations of the Bank of Russia in 
conformity with the internationally recognised practice. 
 
TRANSPARENCY 
- Publication of Information on Trade (paras 320-323) 327. 321-322  The publication of customs regulations and decrees is vital for traders 
attempting to import and export.  We understand, however, that this is often a problem for 
importers.  We understand that there are over 4, 500 customs regulations and "instructions".  
While it is possible that these exist in publis hed form, the State Customs Committee does not 
provide them to importers (or to Embassies) upon request.   
- Could Russia discuss how it is approaching this  issue, e.g., the  need to improve and 
systematize the availability of customs docum ents, and to  simplify the current system 
of customs regulations in its draft customs code?  
 
- Notifications (paras 324-325) 
328. No comments. 
FREE TRADE AND CUSTOMS UNIONS  AGREEMENTS (paras 326-332) 
329. 326 – 332  This member  joins others in calling for further information on tariffs, rules of 
origin and services provisions of Russia’s various preferential agreements.  
 
 We ask that the status of the agreements to  which Russia is party be made clearer by 
providing a more detailed description of progr ess in relation to the following processes: 
- formation of  the Eurasion Economic Community (paragraph 328 refers); 
- amendment or termination of VER agreements (paragraph 329 refers). 
We seek a fuller explanation of why MFN exemptions will be needed in Russia’s GATS Schedule if, as is claimed, the customs union arrangements will be in conformity with GATS 
Article V?  
 
330. 327  Is it the meaning of the text of this para graph that preferential access to exports of 
other CIS to the Russian market is limited to ex porters resident in the exporting country?  If 
so, please indicate how this is compatible with WTO obligations. 
 
331. 328 Please provide a date by which the Article XXIV notifications w ill be provided, given 
that these agreements have long been in effect. 
 
__________