RESTRICTED
WORLD TRADE WT/ACC/RUS/17
11March 1997
ORGANIZATION(97-0980)
Original: English
ACCESSION OFTHE RUSSIAN FEDERATION
Additional Questions andReplies
ThePermanent Mission oftheRussian Federation hassubmitted replies toquestions raised
afterthemeeting oftheWorking Party heldon15-16 October 1996, withtherequest thattheybe
circulated totheMembers oftheWorking Party. Thequestions andreplies arereproduced hereunder.
_______________
Legislative Developments
Question 1.
ThedraftlawconcerningprotectionofRussia'seconomicinterestsinitsexternaltradewasreported
tohave been vetoed bythePresident, after ithadpassed theParliament. Hasthere been any
recent developments onthisdraft law? Ifitshould takeeffect, what import restriction measures
duetobetaken under thislawcould cause inconsistency withtheWTO rules?
Answer
ThedraftFederal Law"OnMeasures toProtect Economic Interests oftheRussian Federation
InForeign Trade inGoods" wasvetoed bytheRussian President. Work iscurrently getting under
waytodraftanewlegislative actconcerning conditions andprocedures fortheapplication ofsafeguards,
andanti-dumping andcountervailing measures. Itistheposition oftheRussian Government thatany
newlegislation should beconsistent withtherelated WTO Agreements.
Question 2.
WilltheRussian Government explain tousabout thePresidential Order issued on18August
toimpose value-added taxonimports from Ukraine andtellushowthisorder doesnotcause
WTO inconsistency?
Answer
Russian Presidential Decree No.1216 “OntheApplication ofValue-Added TaxtoGoods
OriginatingintheTerritoryofUkraineandImportedtotheCustomsTerritoryoftheRussianFederation”
dated 18August 1996, hasbrought therules applicable toRussian-Ukrainian trade (with respect to
thecollection ofvalue-added tax)intolinewiththepractice usedinmany WTO countries, whereby
VATislevied during theimportation ofgoods fromthose countries inwhich theirexports areexempted
from suchtax.
TheRussian Federation hassigned anumber ofinternational agreements andtreaties inthe
areaoftaxation withcountries oftheformer Soviet Union withwhich itmaintains preferential tradeWT/ACC/RUS/17
Page2
andpolitical links. Onesuch agreement istheAgreement Between theGovernments ofthe
Commonwealth ofIndependent States Member States ontheCoordinated TaxPolicy Principles of
13March 1992which provides forexemptions invalue-added taxforgoods imported fromother CIS
countries. Article 23oftheLawoftheRussian Federation No.2118-1 “OntheBasic Principles of
theTaxation System intheRussian Federation ”dated 27December 1992, asamended, provides that
theGovernment oftheRussian Federation shallparticipate inthecoordination ofthetaxation policy
withotherStates oftheCommonwealth ofIndependent States andshallconclude double taxation treaties
withthose States.
TheUkraine wasnotasignatory totheabove mentioned Agreement withCISMember States;
therefore itissubject, asareimports fromallothercountries, totheprovisions oftheLawoftheRussian
Federation “OnValue-Added Tax”dated 6December 1991, asamended, which provides thatgoods
imported intotheRussian Federation aresubject tovalue-added tax.Presidential Decree No.1216
“OntheApplication ofValue-Added TaxtoGoods Originating intheTerritory ofUkraine andImported
totheCustoms Territory oftheRussian Federation ”dated 18August 1996wasadopted toensure that
value-added taxisimposed andcollected withregard togoods originating intheUkraine inaccordance
withtheprocedures applied toallgoods imported intotheterritory oftheRussian Federation from
countries other thantheCIS.
Question 3.
Ithasbeen reported thattheGovernment issued adecision on2September toraise thetariff
ratesfrom1October ontenitems, including synthetic fibretextile fabrics, to30percentmaximum.
Weshould liketohave more detailed information onthese tariff increases. Wearealsoeager
tobeinformed whether tariff increases caningeneral bedecided andtakeeffect without any
approval, exanteorexposte, bytheParliament. Ifthisisthecase, havethere beenanyarguments
inRussia thattheintroduction oftheParliament process might bedesirable inlightofensuring
thestability oftariff rates andraising thepredictability intransactions?
Answer
TheQuestion isnotclearsincenoresolution wassigned on2September. There was,however,
Government Resolution No.998“OnaPartial Change oftheRates oftheImport Customs Duties,
Approved bytheDecision oftheGovernment OftheRussian Federation No.454of6May1995 On
theApproval oftheRates oftheImport Customs Duties ”dated 13August 1996 (seebelow) which
didaddress synthetic fibretextiles. These rateswereincluded intheimport tariffsubmitted byRussia
totheWTO Secretariat inSeptember 1996 forthefourth meeting oftheWorking Party (see
WT/ACC/RUS/15/Add.2).
Under Russian legislation, decisions toaltercustoms dutyratesareaprerogative fortheFederal
Government which hastherighttochange themuptotheextent established bytheFederal Assembly
-currently standing at100percent.Higher ratesrequire adecision oftheFederal Assembly. When
reviewing customs dutyrates, theGovernment presently observes thefollowing practice: ifthenew
ratesarehigher thanthose previously applicable, theytakeeffect onetothreemonths aftertheadoption
andpublication ofthecorresponding decision, which givesparties toforeign economic activities enough
timetoadapt; ifthenewratesarelower thanthose previously ineffect, theygointoforceimmediately.
Forexample, withregard toResolution No.998“OnAPartial Change OfTheRates OfTheImport
Customs Duties, Approved ByTheDecision OfTheGovernment OfTheRussian Federation No.454
Of6May1995OnTheApproval OfTheRates OfTheImport Customs Duties ”dated 13August 1996,
thereduced ratesbecame effective asof15August 1996, while theincreased ratestookeffect asof
1October 1996.WT/ACC/RUS/17
Page3
Question 4.
Wehavebeeninformed thattheState Committee ontheProtection oftheDomestic Market has
beendeliberating theintroduction ofimport quota toabout 30items, suchassugar, textile fabrics
andpetroleum. Weneed more information from theRussian Government about thepresent
situation ofthedeliberations.
Answer
TheWTO Member posing thisquestion hasbeenmisinformed.
TheGovernment oftheRussian Federation ispresently considering recommendations bythe
Commission oftheGovernment oftheRussian Federation forProtective Measures inForeign Trade
toinvokeappropriatesafeguardmeasureswithrespecttoimportsofwhitesugarandindividualcategories
ofelectric lamps. Themeasures recommended would beintheform ofspecial additional duties but
notimport quotas. Thefindings oftherespective investigations werepresented bytheRussian delegation
toWTO Member countries (seeWT/ACC/SPEC/RUS/1, Annex 1B,WT/ACC/SPEC/RUS/2).
Inaddition, theRussian Federation hasstarted apreliminary safeguard investigation forimports
ofsome types ofcolour television sets.TheGovernment oftheRussian Federation isnotpresently
considering theapplication ofsafeguards orimport restrictions withrespect toanyother products.
Question 5.
TheLawonjointventures wasadopted inJanuary 1995. What arethemain changes compared
withtheprevious situation? Arethere anynewrestrictions onmarket access? Hasthere been
anychange regarding foreign equity?
Answer
TheRussian Federation does nothave anyspecific lawonjoint ventures. Federal Law
No.208-FZ “OnJointStock Companies ”wasadopted on26December 1995. Most ofthechanges
brought about bytheJointStock Company Lawdealtwithissues related tocorporate registration and
governance. Nonewrestrictions onmarket access were introduced.
Question 6.
Does theLawonExcise Duties, adopted inMarch 1996, already provide forgradual abolition
ofdiscriminatory rates onimported anddomestic products? Ifnot,when doesRussia intend
toadopt anewlawfreeofanydiscrimination?
Answer
Federal LawNo.12-FZ "OnChanges andAdditions totheFederal Law'OnExcises ',"dated
10January 1997, which came intoforce on21January 1997 (thedayitwasofficially published in
thenational Rossiyskaya Gazeta daily), hasestablished uniform excise ratesforalltypes ofdomestic
excisable products andproducts imported intotheRussian Federation. Anunofficial English language
translation hasalsobeenprovided totheWTO Secretariat.WT/ACC/RUS/17
Page4
Question 7.
Since theLawof13October 1995 onRegulation ofForeign Trade Activity isnotavailable in
theWTO Secretariat, itisnotpossible forustoexamine thematter. Would itbepossible to
obtain theLawassoonaspossible, before theWorking Party 'snextmeeting. Does itnonetheless
contain specific State-trading provisions under Article XVII?
Answer
TheFederal LawNo.157-FZ "OntheState Regulation ofForeign Trade Activities" dated
13October 1995, wassubmitted bytheRussian delegation totheWTO Secretariat inNovember 1995
intimeforthesecond meeting oftheWorking Party, which discussed thislawindetail (seealso
WT/ACC/RUS/15).
Pursuant toArticle 17ofFederal LawNo.157-FZ, theFederal Assembly mayestablish in
theformofaspecial Federal Lawalistofgoods, theexport orimport ofwhich mayonlybecarried
outunder Statemonopoly. Insuchacase,theexport and/or import isexercised under alicence which
isonlytobegranted toState-owned enterprises. However, when carrying outimport orexport
transactions, thelegislation requires State-owned enterprises toadhere totheprinciples of
non-discrimination andfaircommercial practice. However, inpractice, nosuchcases arecurrently
inexistence.
Question 8.
What have themain legislative changes onintellectual property rights been since theWorking
Party 'slatest meeting?
Answer
Therecent main changes onintellectual property rights, include thefollowing:
(i) ThenewCriminal Code oftheRussian Federation entered intoforce on1January 1997.
(ii) LawNo.160-FZ “OntheIntroduction ofAmendments totheCode ofCriminal Procedure
oftheRussian Federation andtheCorrectional Labour Code oftheRussian Federation in
Relation totheAdoption oftheNew Penal Code oftheRussian Federation ”dated
21December 1996, hasgiven thecompetence toinvestigate criminal cases ofcopyright and
related rightinfringements topublic prosecutors 'offices; thesamelawincluded infringements
ofcopyright andrelated rights without aggravating circumstances among those offenses over
which criminal proceedings areinitiated byprivate persons, while making patent infringements
under aggravating circumstances amatter forpublic prosecution.
(iii) Russian Presidential Decree No.1177“OntheStructure oftheFederal Bodies ofExecutive
Powers ”dated 14August 1996, hastransformed theRussian Federation Committee forPatents
andTrademarks intotheRussian Agency forPatents andTrademarks.
(iv) Russian Government Resolution No.947,“OntheIntroduction ofAmendments andAddenda
totheRegulations oftheFeesforPatenting Inventions, Useful Models, Industrial Design for
theRegistration ofTrademarks, Service Marks, theName ofthePlaces ofOrigin ofGoods
andfortheRight toUsetheNames ofthePlaces ofOrigin ofGoods ”dated 12August 1996,
hasapproved andbrought intoforce, asof1October 1996, anewschedule offeesfortheWT/ACC/RUS/17
Page5
patenting ofinventions, utility models, andindustrial designs andfortheregistration of
trademarks andservice marks, andrevised theprocedure forcharging suchfees.
(v) Russian Government Resolution No.614“OnRates ofFeesPayable toPerformers forCertain
UseofPerformance (Production) ”dated 17May1996, hasapproved arecommended schedule
ofcompensation toperformers forsome types ofperformances (productions).
(vi) Russian Government Resolution No.943“OnRates ofFeesPayable toPerformers forCertain
UseofPerformance(Production)”dated6August1996,hasintroducedadministrativemeasures
toprotect some trademarks andother signs related toalcoholic products, approved alistof
suchmarks andsigns, andordered astudy tobeconducted oftheadvisability ofextending
suchmeasures toother trademarks andsigns, including those owned byforeign rightholders.
(vii) On27June1996, Rospatent approved Rules fortheAnnulment ofTrademark Registrations
During theLiquidation ofLegal Entities Owning Such Trademarks.
Question 9.
Initsresponse toquestion 165ofWT/ACC/RUS/13/Add.1, Russia declines togiveanyinformation
onlegislation under preparation toaddress theapplication ofsafeguards andanti-dumping and
countervailing duties. Thisresponse isinadequate. Please provide theWorking Party withas
much ofthefollowing information aspossible:
(a) asummary oftheprovisions ofthedraft legislation describing, interalia,what protective
measures arecontemplated andwhatparts oftherelevant WTO agreements areaddressed;
(b) astatus report onthepossible passage andimplementation ofthislegislation; and
(c) acopyoftheproposedlegislationonsafeguard,anti-dumping,andcountervailingmeasures
forWorking Party review. Onthispoint, webelieve thatreview ofthisdraft legislation
willassist Russia indeveloping WTO-consistent provisions andwillspeed completion of
theaccession negotiations.
Answer
SeeAnswer 1herein.
TheRussian Federation willsubmit totheWTO Secretariat thetextofthelawonceadopted
along withthedetailed analysis ofitsrules andprovisions.
Question 10.
Please reconsider theresponse toquestion 166ofWT/ACC/RUS/13/Add.1, andsupply theprecise
information requested.
Answer
The precise information requested has already been supplied indocuments
WT/ACC/SPEC/RUS/1, Annex 1Aand1B,andWT/ACC/SPEC/RUS/2.
SeealsoAnswer 4herein.WT/ACC/RUS/17
Page6
Question 11.
Please supply theinformation requested inquestion 169ofWT/ACC/RUS/13/Add.1.
Answer
Inorder toreceive aletter ofconsent fromaministry (agency) asrequired toobtain animport
licence (seeWT/ACC/RUS/10), either theMFER ortheapplicant himself sends arequest toprovide
suchaletter ofconsent, aswellasacertified copyofthecorresponding foreign trade contract, tothe
ministry (agency) concerned. Thelatter examines these documents soastosatisfy itself thattheyare
consistent with Russia 'sinternational obligations andinaccordance withconditions covered by
Articles XXandXXIofGATT 1994.
Thisprocedure isinaccord withtheWTO Agreement onImport Licensing, andissimilar
tothatusedbyother WTO Member countries. Forexample, identical arrangements aredescribed
intheUnited States 'answers tothequestionnaire regarding import licensing procedures, which was
submitted totheWTO Secretariat (seeG/LIC/N/3/USA/1).
Question 12.
Initsresponse toquestion 183ofWT/ACC/RUS/13/Add.1, Russia declines togiveany
information onprovisions ofthedraft legislation concerning foodquality, safety, andcertification.
Thisresponse isinadequate. Please provide theWorking Party withasmuch ofthefollowing
information aspossible:
(a) asummary oftheprovisions ofthedraft legislation;
(b) astatus report onthepossible passage andimplementation ofthislegislation; and
(c) acopy oftheproposed legislation. Onthispoint, webelieve thatreview ofthisdraft
legislation willassist Russia indeveloping WTO-consistent provisions andwillspeed
completion oftheaccession negotiations.
Answer
(a) Thelegislative regulation ofthequality offoodstuffs inRussia iscarried outthrough the
following laws:
- Russian Federation LawNo.1034-1 "OntheSanitary andEpidemiological Well-Being
ofthePopulation" dated 21April 1991;
- Russian Federation LawNo.4979 "OnVeterinarian Services" dated 14May1993;
and
- Federal LawNo.171-FZ "OntheStateRegulation oftheProduction andCirculation
ofEthanol andAlcoholic Products" dated 22November 1995.
(b) In1997, itisplanned toapprove:
- Draft Law"OntheSanitary andEpidemiological Well-Being ofthePopulation";
- Draft Law"OntheQuality andSafety ofFoodstuffs,"; and
- Draft Law"OnDrinking Water."
(c) TheRussian Federation willsubmit totheWTO thetextofthelawonceadopted.WT/ACC/RUS/17
Page7
Regarding Replies inWT/ACC/RUS/9/Add.1
Question 13.
Thereply toadditional question 31states thatthe"adoption ofother lawsreforming thetaxsystem
isnotplanned" except fortheproposed draft TaxCode (according totheresponse).
Under these circumstances, how willtheprovisions ofDecree No.685of8May 1996 be
implemented?
Ifthese reforms arenotbeintroduced until thenewTaxCode takes effect, forwhat purpose
wasthisdecree promulgated earlier thisyear? Werefer specifically tothree provisions calling
for:
(a) institution oftaxamnesty;
(b) clarification ofregulations governing deductibility ofbusiness expenses, inorder tolist
explicitly those deductions which areforbidden; and
(c) revision ofschedules forcalculating capital depreciation deductions.
Answer
(a) Asfarastheimplementation ofthetaxamnesty clause ofRussian Presidential Decree No.685
"OnGuidelines forTaxReform intheRussian Federation andonMeasures toStrengthen Tax
andPayment Discipline," dated 8May1996, isconcerned, theRussian Ministry ofFinance
inMay1996 drafted another presidential decree which provided forataxamnesty.
Itwasdecided later, however, thatitwould beinadvisable intheimmediate future togrant
ataxamnesty intheform envisaged byPresidential Decree No.685.
Astotherestoftheedict, itsprovisions asawhole donotcontradict theideaofpreparing
andadopting aTaxCode, astheimprovement ofthetaxation system isacontinuous exercise.
(b) Pending
(c) Pending
Question 14.
Concerning thereference toDecree No.73of25January 1995inthereply toadditional question
45b:
Does thisDecree remain ineffect, sothatpotential foreign investors arestilleligible tobenefit
from itstariff provisions?
Answer
Presidential Decree No.73“OnTheAdditional Measures ToAttract Foreign Investments To
TheBranches OfMaterial Production OfTheRussian Federation ”dated 25January 1995 isstillin
effect. Potential foreign investors remain eligible forpreferential tariff treatment.WT/ACC/RUS/17
Page8
Regarding Replies inWT/ACC/RUS/13/Add.1
Question 15.
Please confirm ourunderstanding from thereply toadditional question 108,part2,thatRussia
plans toabolish allrestrictions onforeign involvement incharter capital ofinsurance-providing
organizations notlater thanMay1999.
Answer
Inaccordance withthePartnership andCooperation Agreement between theRussian Federation
andtheEU,provided thatthisaccord takes effect before themiddle of1999, theRussian Federation
willliftthe49percentlimitonforeign equity participation inRussian insurance companies forEU
companies having subsidiaries intheRussian Federation.
Question 16.
Concerning thereply toadditional question 152:
What isthestatus ofefforts toequalize excise taxtreatment ofimported anddomestically-produced
goods?
Arethere plans tochange thebasis ofautomobile excise taxes from aengine displacement toan
advalorem calculation?
Answer
SeeAnswer 6herein.
Question 17.
Several documents relevant toRussia 'sforeign trade regime arenotnoted indocuments
WT/ACC/RUS/15 andthetwoaddenda, which purport tobecurrent asof1September 1996.
These are:
- Federal LawNo.114-FZ “OntheProcedure fortheEntry IntoandtheExitfrom the
Russian Federation ”dated 15August 1996;
- Letter oftheFederal TaxService andtheMinistry ofFinance No.1145“OntheProcedure
fortheCalculation andPayment ofTransportation TaxbyForeign Legal Entities ”
registered withtheMinistry ofFinance on6August 1996;
- Presidential Decree No.1209“OnState Regulation ofForeign Barter Transactions ”dated
18August 1996;
- Presidential Decree No.1275 “OnAbolishing thePresidential Decree No.2285 “Issues
ofProduction Sharing Agreements ”dated 24December 1993" dated 28August 1996;
- Government Resolution No.953“OnGranting Deferral ofPayments ofArrears tothe
Federal Budget forGold Mining Enterprises andOrganizations ”dated 13August 1996;WT/ACC/RUS/17
Page9
- Government Resolution No.987“OnMeasures toStrengthen theProcedures forTrade
inAlcoholic Products ”dated 19August 1996;
- Presidential Decree No.1213 “OnMeasures toStrengthen State Control Over Trade in
Alcoholic Products ”dated 18August 1996.
Answer
Thedocuments listed inWT/ACC/RUS/15 wereintended tobeaconsolidation ofalllegislative
actsreferred tointheQuestions andAnswers fortheSecond, Third andFourth Working Parties.
Document WT/ACC/RUS/15 wasnotintended tobeanexhaustive listofalllegislation adopted since
thelastWorkingParty.However,toassistMembers,theRussiandelegationhassubmittedthelegislation
requested totheSecretariat anditisavailable forconsultation byMembers oftheWorking Party.
Customs Valuation
Question 18.
Weareconcerned howtheRussian Government willimplement theWTO rules oncustoms
valuation. WilltheRussian Government make amendments totheirdomestic lawsandregulations
oncustoms valuation tomake theRussian customs valuation systems consistent withtheWTO
Agreement? Or,willtheWTO Customs Valuation Agreement bedirectly applied inRussia?
Answer
InaccordancewithClause4ofArticle15oftheConstitutionoftheRussianFederation,generally
recognized norms ofinternational lawandinternational agreements towhich theRussian Federation
isaparty formpartandparcel ofitslegalsystem and,intheevent ofaconflict between rulesstipulated
byaninternational treaty andthose established byinternal legislation oftheRussian Federation, the
rules setforth intheinternational treaty prevail.
Pursuant toArticle 5oftheRussian Federation LawNo.101-FZ “OnInternational Agreements
oftheRussian Federation ”dated 15July1995 ruleswhich havebeenestablished byaninternational
agreement andofficially published intheRussian Federation, towhich theRussian Federation isa
party, havedirect application throughout theRussian Federation unless itisrequired thatinternal
regulatory legalactsbeissued togovern theirenforcement; forother rulesofinternational agreements
toapply, corresponding legal actsneedtobeadopted (inkeeping withArticle 34andSection 5of
theRussian Federation Law“OnInternational Agreements oftheRussian Federation ”).Seealso,
answer 98ofWT/ACC/RUS/13/Add.1.
Finally, Article 38oftheRussian LawonCustoms Tariff No.5003-1 of21May1993
specifically provides thatifaninternational agreement, towhich Russia isaparty, establishes different
norms other thanthose laiddown hereunder, thenorms established bysuchinternational agreement
shallprevail.
TheRussian Federation isnotyetamember oftheWTO, however upon theentry intoforce
ofthistreaty, theterms setforthintheinternational treaty willprevail. Asfarascustoms valuation
isconcerned, work isunder waytoupdate existing customs legislation, including changes which take
account ofWTO rulesoncustoms valuation. TheRussian Federation willamend inconsistent domestic
lawsandregulations toensure fulfilment oftheprovisions oftheinternational agreement, andtoreduce
theconfusion intheapplication andenforcement ofsuchother lawswithin theterritory oftheRussian
Federation.WT/ACC/RUS/17
Page10
With reference to:WT/ACC/RUS/14
1(a)(iv) Implementation ofArticle 1.2(b)
Question 19.
Russia hasstated thatArticle 15(2) oftheCustoms Lawstates thattheimporter hastheright
toprove thattherelationship hashadnoimpact onthetransaction value. Information onprices
ofsimilar oridentical goods supported byrelevant documents canbeusedinthiscase.
Answer
Yes,thisstatement iscorrect. Incases where theacceptability forcustoms valuation purposes
using thetransaction value method oneinasalebetween related parties isquestioned bythecustoms
administration, theimporter mayconfirm thattherelationship didnotinfluence thetransaction value,
bydemonstrating thatsuchvalue closely approximates oneofthefollowing occurring atorabout the
same timeasthesaleofthegoods being valued:
- thetransaction value insalesbetween unrelated buyers andsellers ofidentical orsimilar goods
forexport totheRussian Federation; or
- thecustoms value ofidentical orsimilar goods asdetermined under Articles 22and23ofthe
Customs Tariff Law.
When comparing theabove testvalues, dueaccount istaken oftheactual differences in
commercial levels andquantity levels, aswellastheadditional value components listed inArticle 19(1)
oftheCustoms Tariff Law.
Question 20.
Thisresponse doesnotcompletely answer thequestion. Article 15,para2oftheLawdeals with
theobligation ofthedeclarer tosupply information proving valuation. Itdoesnotaddress the
criteria stipulated inArticle 1.2(b) oftheCustoms Valuation Agreement which listtheconditions
under which transaction value maybeapplied inasalebetween related persons.
Answer
Theprincipal criteria forallowing theapplication oftransaction value method oneinasale
between related parties issetforthinArticle 19(2) oftheCustoms Tariff Law, which saysthatmethod
onemaynotbeapplied forcustoms valuation purposes iftheparties toatransaction arerelated, except
where theirrelationship didnotimpact thetransaction value, something which thedeclarer should prove.
TheCustoms Tariff Lawdoesnotestablish anyspecial restrictions onhowtheimporter can
demonstrate theabsence ofsuchimpact. Theuseoftheabove testvalues forcomparison withthe
transaction value inasalebetween related parties follows fromthelogic oftheCustoms Tariff Law,
andisindeed accepted inpractice (SeealsoAnswer 19herein).
Question 21.
While Article 19(1) ofRussia 'sCustoms Lawstates thatthecustoms value ofgoods import to
Russian custom territory shall bethetransaction value, Article 19(2) oftheLawsaysthatthis
method maynotbeused where therelated parties areconcerned “withtheexception ofcasesWT/ACC/RUS/17
Page11
where mutual dependence hasnotinfluenced thevalue ofadeal, which shall beproved bythe
declarant. ”This would appear toestablish thatthere isalegal presumption thattheuseof
transaction value forthecustoms valuation oftrade between related parties isnotautomatically
acceptable.
Answer
TheCustoms Valuation Agreement doesnotprovide foralegalpresumption thattheuseof
transaction value forthecustoms valuation oftradebetween related parties isautomatically acceptable.
Instead, Article 1.2(a) oftheCustoms Valuation Agreement requires that:
“...insuch(related party) case(s) thecircumstances surrounding thesaleshall be
examined andthetransaction value shallbeaccepted provided thattherelationship
didnotinfluence theprice. ”
Intheopinion oftheRussian Delegation, theinclusion intheCustoms Valuation Agreement
ofthiscondition, forthecustoms valuation oftrade between related parties, rules outtheautomatic
applicationofthetransactionvalueforthepurpose.ItthereforefollowsfromArticle15(2)oftheRussian
LawonCustoms Tariff No.5003-1 of21May1993, "where thedeclared customs value needs tobe
confirmed," i.e.where thetransaction value made thecustoms administration doubt itsacceptability
forcustoms valuation using method one,thecustoms administration mayrequire thatsupporting
documents bepresented. Intheabsence ofsuchdocuments, thedeclarer usesmethods twotosix
forcustoms valuation purposes.
Ifthedeclarer needs additional timetosupply therequired data,theArticle 15(3) oftheRussian
LawonCustoms Tariff No.5003-1 of21May1993envisages thepossible useofaspecial procedure
(theprovision ofgoods foruseagainst apledge ofassets oraguarantee ofanauthorized bankpursuant
tolegislation oftheRussian Federation, orthepayment ofcustoms duesinaccordance withthecustoms
value ofthegoods asdetermined bythecustoms administration oftheRussian Federation) ifthedeclarer
wishes suchprocedure tobeinvoked.
Thedatawhich isusually usedtodemonstrate thattherelationship between abuyer andaseller
didnotinfluence thetransaction value inasalebetween them isdescribed inanswer 19herein.
Question 22.
Please provide clarification ofhowthismeasure isconsistent withArticle 1.2aoftheCustoms
Valuation Agreement, which specifically states that“thefactthatthebuyer andtheseller are
related within themeaning ofArticle 15shallnotinitselfbegrounds forregarding thetransaction
value asunacceptable. ”
Answer
SeeAnswers 19-21 herein. Inaddition, theapproach oftheRussian Federation issimilar to
other developed WTO Member countries ’lawandregulations which provide thatthetransaction value
between arelated buyer andseller isacceptable ifanexamination ofthecircumstances ofthesale
indicates thattheirrelationship didnotinfluence thepricepaidorpayable. Where Customs authorities
inother developed WTO Member countries dohavedoubts about theacceptability oftheprice and
areunable toaccept thetransaction value without further inquiry, theimporter isgiven anopportunity
tosupply suchfurther detailed information asmaybenecessary toenable Customs toexamine relevant
aspects ofthetransaction.WT/ACC/RUS/17
Page12
Theapproach isalsoinaccord withtheWTO Decision Regarding Cases Where Customs
Administrations Have Reason toDoubt theTruth orAccuracy oftheDeclared Value which provides
thatwhere thecustoms administration hasreason todoubt thetruthoraccuracy oftheparticulars, the
importer maybeasked toprovide further explanation, andifafterreceiving further information, or
intheabsence ofaresponse, thecustoms administration stillhasreasonable doubts about thetruth
oraccuracy ofthedeclared value, itmaybedeemed thatthecustoms value oftheimported goods cannot
bedetermined under theprovisions ofArticle 1oftheAgreement onImplementation ofArticle VII
oftheGeneral Agreement onTariffs andTrade -1994.
Question 23.
Please clarify if,inasalebetween related persons, thetransaction value shall beaccepted and
thegoods valued inaccordance withthemethod setforth inArticle 19(1) whenever theimporter
demonstrates thatsuchvalue closely approximates totheconditions setforth inArticle 1.2bof
theCustoms Valuation Agreement.
Answer
According toArticle 19(2) oftheRussian LawonCustoms Tariff No.5003-1 of21May1993,
where theparties toatransaction arerelated, buttheimporter demonstrates thattheirrelationship did
notimpact thetransaction value, thegoods aretobevalued under Article 19(1) oftheLaw(provided
thatthere arenoother restrictions ontheuseofmethod oneasimposed byArticle 19(2) oftheLaw).
Question 24.
Please provide specific examples ofwhat “proof ”isotherwise acceptable toshow thatthe
relationship hashadnoimpact onthecustoms transaction atissue.
Answer
Asnoted intheRussian response totheCustoms Valuation Questionnaire, WT/ACC/RUS/14
at1(a)(iv), verification ofthetransaction value includes thepossibility ofthedeclarant providing
comparison prices ofidentical orsimilar goods.
SeealsoAnswer 19herein.
1(b)Provisions regarding lostordamaged goods
Question 25.
Russia hasexisting procedures toallow forthepossible adjustment ofthecustoms value oflost
ordamaged goods. Weappreciate thecitation ofthelawregarding thepossible adjustment of
thecustoms value oflostordamaged goods.
Answer
SeeAnswer 26herein.WT/ACC/RUS/17
Page13
Question 26.
Pleasebrieflydescribetheguidancesetforthintheapplicableregulationsorlegislationthatprovides
inwhat cases andinwhat manner animporter canadjust thecustoms value forlostordamaged
merchandise.
Answer
TheOrder oftheStateCustoms Committee oftheRussian Federation No.1of5January 1994
“Concerning theCustoms Value ofGoods Brought totheRussian Federation ”includes Supplement
No.2theRules ofFiling aCustoms Value Declaration asperForm DCV-1 which provides inrelevant
part:
- Ifintheprocess ofeffecting customs formalities, discrepancies emerge between thedataon
thequantity and/or quality ofthegoods actually established bycustoms inspectors, these
differences shallberecorded asdue.However, onlytheinitial value ofgoods shallbeincluded
inthedeclaration. Thegoods ’customs value shallberecalculated, thecustoms declaration
specified asindicated byProvisions ’rules (Item 2.9)andpayments finalized asperthe
declarant ’swritten application after itsettles claims withtheperson responsible forthe
discrepancy established (theseller, carrier orinsurer).
- Ifacommodity waslostorspoiled priortodeclaring itscustoms value, itsinitial invoice price
maybereduced asdictated bythesizeofthespoilage orlossonlyifthedeclarant submits
tothecustoms office concerned documents toconfirm thespoilage (loss) andthesatisfaction
ofthespoilage-loss-related claims bythepersons responsible forthepreservation ofthesaid
goods (theseller, carrier orinsurer).
ThisOrder alsoincludes Supplement No.3Temporary Instructions forFiling Form CCV-1
andForm CCV-2 forthepurpose ofcorrecting thegoods ’customs value during thefinaldetermination
ofthegoods ’customs value onthebasis ofadditional information submitted bythedeclarant or(in
theabsence ofsuchinformation) inthecourse ofthegoods ’evaluation byacustoms office (see
Article 11oftheCustoms Code onthestatus ofregulatory actsoftheState Customs Committee of
theRussian Federation).
2. Implementation ofprovision ofArticle 4toallow theimporter anoption toreverse the
order ofapplication ofArticles 5and6
Question 27.
Please clarify howtheCustoms Lawensures thatonlytheimporter canrequest reversal theorder
ofapplication ofcustoms valuation methods setoutinArticles 5and6oftheAgreement.
Answer
UnderArticle13oftheRussianLawonCustomsTariffNo.5003-1of21May1993,thecustoms
value isinitially declared anddetermined bythedeclarant. Accordingly, theprovision inArticle 18(2)
oftheLawtotheeffect thatthemethods ofvalue subtraction andvalue summation maybeapplied
inanyorder presupposes thechoice oftheuseofthese methods primarily bythedeclarer.WT/ACC/RUS/17
Page14
4. Implementation ofArticle 6.2
Question 28.
Russia notes thattheRegulations ontheProcedure andConditions forDeclaring theCustoms
Value ofGoods Imported Onto theCustoms Territory oftheRussian Federation implements
Article 6.2.
What isthespecific article inthese regulations thatprovide forimplementation ofArticle 6.2?
Answer
According toArticle 13oftheRussian LawonCustoms Tariff No.5003- 1of21May1993,
thecustoms value isdeclared tothecustoms administration bythedeclarant, andonlyRussian parties
maybedeclarants under Article 172oftheCustoms Code oftheRussian Federation. Consequently,
anyandalldemands forthepresentation ofdocumented proof ofdeclared customs values, aslisted
inprovisions 2.4and2.5oftheRegulations ontheProcedure andConditions forDeclaring theCustoms
Value ofGoods Imported Onto theCustoms Territory oftheRussian Federation, maybemade by
Russian customs authorities onlytoRussian declarants.
5. Questions concerning Article 7
Question 29.
Theprovision inRussia ’scustoms lawthatrequires “dueregard forworld practice ”doesnot
actually mandate thatthemethods andprocedures fordetermining thecustoms value ofgoods
contained inArticle 7oftheValuation Agreement beused.
WillRussia revise itslawtocorrespond withthispartofArticle 7?
Answer
Section IVoftheCustoms Tariff Lawisavirtual restatement ofthecorresponding provisions
oftheAgreement onImplementation ofArticle VIIofGATT oncustoms valuation methods. The"world
practice" referred to,therefore, isprecisely thepractice ofapplying thesemethods, i.e.theAgreement
onImplementation ofArticle VIIofGATT andtheother applicable GATT/WTO documents (seealso
Answers 18and36herein).
Question 30.
Inaddition, Russia states initsresponse toquestion 5(c)regarding thedelineation ofthe
prohibitions found inArticle 7.2thattheCustoms Lawmakes requirements onprice criteria for
thevaluation ofgoods using method 6.
HasRussia'sCustomsLawbeenamendedtoincludetheprohibitedpricesasabasisfordetermining
valuation itomitted initspassage inMay 1993, including (b)asystem which provides forthe
acceptance forcustoms purposes ofthehigher oftwoalternative values, (d)thecostofproduction
other thancomputed values which hasbeendetermined foridentical orsimilar goods inaccordance
withheprovisions ofArticle 6,and(f)minimum customs values? Ifnot,when willthelawbe
amended tobeconsistent withtheCustoms Valuation Agreement?WT/ACC/RUS/17
Page15
Answer
SeeAnswer 18herein.
8. Ensure Confidentiality, asrequired byArticle 10
Question 31.
Please clarify thespecific measures orcircumstances “envisaged byRussian legislative acts”that
would nullify thecommitment onconfidentiality required inArticle 10oftheAgreement.
Answer
Suchcircumstances include judicial proceedings overcustoms matters, aswellascircumstances
arising asaresult ofoperations ofother Russian lawenforcement investigative authorities (theInterior
Ministry, theFederal Counter-Intelligence Service, thetaxpolice, etc.)thelimits ofwhose competence
aresetbyeachoftheirapplicable legislative actsoftheRussian Federation.
13. Inclusion oftheInterpretive Notes oftheAgreement
Question 32.
Please provide citation ofRussian legislation orregulations thatincorporate theprovision ofthe
Interpretive Notes inRussia ’slaw. Where such citations arenotpossible, please discuss how
thenecessary changes willbemade toensure thattheyaredealt withinthesame manner asthe
other provisions oftheAgreement.
Answer
Thecitations oftheRussian legislation andregulations which incorporate theprovisions of
theInterpretative Notes intoRussian lawareasfollows:
- LawNo.5003-1 “OnTheCustoms Tariff ”of21May1993 (asamended); and
- Resolution oftheGovernment oftheRussian Federation No.856“OnTheApproval OfThe
Procedure ForEstimating TheCustoms Value OfGoods Brought IntoTheTerritory ofthe
Russian Federation ”dated 5November 1992.
Theprovisions ofItem3oftheInterpretative NotetoArticle 1onthecosts andexpenses which are
notincluded inthecustoms value arereflected intheInstructions ontheCompletion ofaCustoms
Value Declaration (Section C).Alltheother notes willlikewise begradually taken intoaccount in
regulatory actsoftheStateCustoms Committee oftheRussian Federation (seealsoAnswer 18herein).
14. Implementation ofDecision of26April 1984 onTreatment ofInterest Charges inthe
Customs Value ofImported Goods
Question 33.
Currently there arenoprovisions regarding thisdecision. What, ifany,areRussia ’splans to
implement thisdecision?WT/ACC/RUS/17
Page16
Answer
SeeAnswer 18herein.
15. Paragraph 2ofthe1984 Decision onValuation ofCarrier Media Bearing Software
Question 34.
Currently there arenoprovisions regarding thisdecision. What, ifanyareRussia ’splans to
implement thisdecision?
Answer
SeeAnswer 35herein
Question 35.
WeseekRussia 'sagreement toimplement thisdecision infavour ofvaluing theimport based
onthecostofthemedia, notthesoftware itcontains.
Answer
The1984 Decision oftheTechnical Committee under theCustoms Cooperation Council on
thevaluation ofcarrier media bearing software doesnotstipulate itsobligatory enforcement byall
member countries. TheRussian Federation applies general provisions setforth intheAgreement on
Implementation ofArticle VIIofGATT forthevaluation ofsoftware products, anditsrelated regulations
arefullyconsistent withthisAgreement. Ittherefore appears more proper toexamine theissue of
implementing Paragraph 2oftheTechnical Committee 's1984Decision aspartofnegotiations ontrade
concessions, rather thanaspartofanevaluation ofhowconsistent Russian legislation oncustoms
valuation iswiththeGATT/WTO Customs Valuation Agreement.
Question 36.
Initsresponse toQuestion 5(a)inDocument WT/ACC/RUS/14, inrelation tovalue determinations
made pursuant toArticle 7,theRussian Federation states that"thecustoms value shall be
determined withdueregard forworld practice".
CantheRussian Federation explain what isthisworld practice?
Answer
Anexplanation regarding theprovisions ofArticle 24(1) oftheCustoms Tariff Lawhasbeen
provided bytheCustoms Tariff Department oftheStateCustoms Committee oftheRussian Federation
initsLetter ofInstruction No.07/11/12510, dated 31August 1995, which states inrelevant part:
World practice treats method sixasaflexible useofthepreceding valuation methods.
Thisiswhyitisnecessary, when using thismethod, toobserve allthebasic principles
ofcustoms valuation which relate totheapplication ofmethods onethrough five.
Thisexplanation isinlinewithNotes 1-2toArticle 7oftheCustoms Valuation Agreement (seealso
Answer 18and29herein).WT/ACC/RUS/17
Page17
Question 37.
Thereply toQuestion 5(c)-Prohibitions found inArticle 7.2oftheWTO Agreement- states that
Russian Federation Law"makes requirements onprice criteria forthevaluation ofgoods using
method 6".
CantheRussianFederationprovidefurtherdetailsandexamples,or,ifcontainedinthe"regulatory
documents" issued bytheState Customs Committee, which specific documents arerelevant?
Answer
Such requirements aremade inaletter oftheCustoms Tariff Department oftheStateCustoms
Committee oftheRussian Federation mentioned inAnswer 36,which states inrelevant part:
“...the following maybeusedasthebasis forcustoms valuation when determining
thecustoms value bymeans ofmethod six:
- thecustoms value ofidentical orsimilar goods, orgoods ofthesame class
orkind, accepted bythecustoms administration andmeeting established
requirements (inthiscase, method sixisusedonthebasis ofmethods one,
two,orthree);
- thevalue ofimported identical orsimilar goods, orgoods ofthesame class
orkind, atwhich theyaresoldonthedomestic market oftheRussian
Federation andwhich shallbeadjusted forpermitted deductions (method six
onthebasis ofmethod four); or
- value datafromneutral sources ofinformation (catalogues ofindependent firms
likeEurotax, OTTO, etc.;publications containing detailed descriptions of
specific goods andclear-cut definitions ofvalue structures; published or
mailed-in official price listsforgoods orfirms'commercial offers tosupply
specific goods atspecific prices, aswellasexchange price quotations).
Where dataregarding other transactions, aswellaspermitted value data, isusedas
partofmethod six,itshallberequired totakeintoaccount theunderlying, initial
conditions ofspecific transactions (such asquantities ofgoods being purchased and
theircommercial salelevels, pricediscounts, andcontractual terms fordeliveries and
payments). Requirements forthecomposition ofcosts included inthecustoms value
(Articles 19,22,and23oftheRussian Federation Law'OntheCustoms Tariff ')also
must befulfilled.
Onecommon requirement forallsource value datausedforcustoms valuation under
Method Sixshallbeitsnarrowly targeted use,meaning thatvalues (prices) mustrefer
tospecificgoodsdescribedinamannermakingitpossibletoidentifythemunequivocally
(commercial name ofthegoods, theirdescription asanassortment, dataregarding the
producer firm, materials, technical parameters, andother characteristics depending
onthecategory ofthegoods).
Customs valuation according tomethod sixshall, therefore, bebased onreal,
substantiatedvaluedata,unlessitsusecontradictsrequirementssetforthinArticle24(2)
oftheRussian Federation Law'OntheCustoms Tariff. ”WT/ACC/RUS/17
Page18
Another obligatory requirement during theuseofmethod sixshallbeensuring themaximum
possible similarity ofgoods (meaning thatwhere possible analogues arebeing considered forcomparing
thevalues ofgoods, firstidentical goods andthensimilar goods shallbeselected or,intheirabsence,
goods ofthesame classorkindshallbechosen).
Itisinthelightoftheabove requirements forvalue dataandtheselection ofanalogous goods
thatoneshalltreattheprovisions ofArticle 24(2) oftheRussian Federation Law'OntheCustoms
Tariff 'which prohibits theuseasthebasis forcustoms valuation of'thevalue ofgoods ifarbitrarily
fixedornotconfirmed byreliable evidence '(which happens ifthechoice ofananalog forthevaluation
ofgoods wasmade incorrectly). Itshallthusnotbepermitted touse,forcustoms valuation purposes
under method six,anymean dataforgeneralized categories ofgoods (women 'sfootwear, men'ssuits,
perfumes, grape wine, etc.).
Question 38.
With respect tothereplies toQuestions 14&15,could theRussian federation indicate when the
provisions referred tointhese questions willbeaddressed?
Answer
SeeAnswers 33through 35herein.
Non-Tariff Measures
Question 39.
Annex8ofWT/ACC/SPEC/RUS/2providesforacomprehensivelistofimportnon-tariffmeasures.
Weareinneed ofasimilarly comprehensive listforexport non-tariff measures.
Answer
Theagenda ofthefifthmeeting, asapproved bytheChairman oftheWorking Party, does
notprovide forthediscussion ofthenon-tariff regulation ofexports ofmanufactured goods. Thisis
whythelistofnon-tariff measures applied bytheRussian Federation willbeprepared induecourse.
Question 40.
Annex 8ofWT/ACC/SPEC/RUS/2 shows thatitems under Chapter 87aretreated differently
intaxation fordomestic andimported products. WewishtheRussian Government toprovide
uswithadetailed explanation onthistaxation system.
Answer
SeeAnswer 6herein.
Question 41.
Weareaware ofthree foreign testlaboratories whose certificates ofconformity arerecognized
byRussian authorities. HastheRussian Federation signed, andwithwhich countries, anybilateral
agreements onreciprocal recognition ofcertificates?WT/ACC/RUS/17
Page19
Answer
According totheProcedure fortheRecognition ofCertification Results, which wassigned
bycountries participating intheAgreement of23October 1993, among Russia 'sStateCommittee on
Standards andeachoftheother signatories (including theRepublic ofAzerbaijan, theRepublic of
Armenia, theRepublic ofBelarus, theRepublic ofGeorgia, theRepublic ofKazakhstan, theKyrgyz
Republic, theRepublic ofMoldova, theRepublic ofTajikistan, theRepublic ofTurkmenistan, Ukraine,
andtheRepublic ofUzbekistan) theParties mutually recognize thecertificates ofconformity issued
bytheirnational certification systems.
Thecertificates ofconformity from theabove-listed countries insuchcases arere-executed
asRussian certificates ofconformity oftheGOST Rcertification system.
SeealsoAnswer 249herein.
Question 42.
Isthere anyintention oftheRussian Government tointroduce anyform ofState control onbarter
transactions?
Answer
State regulation inthisfieldaimstoprevent capital flights andpossible taxavoidance from
theRussian Federation during theperformance ofsuchtransactions.
On18August 1996, thePresident oftheRussian Federation passed Decree No.1209 "On
StateRegulation ofForeign Barter Trade Deals" which came intoforce on1November 1996. Decree
No.1209 setsoutthegeneral framework forconcluding foreign trade barter deals which aredefined
asdealswhereby goods, works andservices ortheresults ofintellectual activity areexchanged. Decree
No.1209 further setsoutmandatory provisions forawritten barter dealcontract.
On31October 1996theGovernment oftheRussian Federation adopted Resolution No.1300
"OntheMeasures forState Regulation ofForeign Barter Trade Transactions" whereby itdelegated
totheState Customs Committee theresponsibility forthecontrol andcustoms processing ofgoods
exported from orimported intoRussia, including barter transactions.
Asummary oftheregulatory mechanism isanarrangement whereby aRussian participant
inforeign economic activities isrequired tohaveapassport forthecorresponding barter transaction
executed bytheMinistry ofForeign Economic Relations oftheRussian Federation andtocomplete
theexchange ofgoods, work, services, orintellectual assets having avalue equal toexported goods
(work, services, orintellectual assets) forsuchexports (i.e.toimport saidequivalent goods, work,
services, orintellectual assets intoRussia) within 180daysafterthecommencement ofthetransaction.
Asimilar procedure forexport/import goods-for-cash transactions hasbeenineffect inRussia since
1993.
Question 43.
With regards totheinformation provided onpage1ontheinvestigation currently being conducted
concerning theincreased imports ofindividual categories ofconsumer electric lamps, would the
Russian delegation specify which categories oflamps might possibly become subject toquantitative
restrictions andwhen theserestrictions areexpected toenter intoforce? Please provide information
onamounts ofquotas ascribed toeachcategory oflamps.WT/ACC/RUS/17
Page20
Answer
Thesubject ofthisinvestigation isHSitems 8539 10900,8539 10100and8539 21.Itis
anticipated thatpossible safeguard measures would involve additional customs duties ontheseproducts,
andnotquantitative restrictions intheform ofimport quotas. Atpresent, thisissue isstillunder
consideration.
SeealsoAnswer 4herein.
Question 44.
Could theRussian delegation supply anup-to-date listofgoods towhich lower excise taxes apply
orwhich areexempt ofexcise tax.
Answer
SeeAnswer 6herein.
Question 45.
Thelawsreferenced inWT/ACC/SPEC/RUS/2 werenotmade available forreview bytheWorking
Party intimetoprovide questions onthem within thedeadline setbytheWorking Party Chairman.
AstheMontreal Protocol andtheBasel Convention arecited astherationale formeasures to
restrict imports, wewould liketounderstand whyandhowtheprovisions ofthese international
environmental agreements canbeusedasthebasis fornon-automatic licences. Please provided
these documents assoonaspossible.
Answer
TheRussian Delegation hasnotprovided theWTO Secretariat withthetextsofsuchmultilateral
international agreements astheMontreal Protocol, theBasel Convention, orthe1961 U.N. Single
Convention onNarcotic Drugs, since virtually alloftheWTO Member countries areparties tothese,
andarewellaware oftherespective international arrangements. Furthermore, these documents are
constantly citedinWTO materials, including those onimport licensing filedbyother WTO Members
(See, forinstance, Hong Kong'sanswers tothequestionnaire onimport licensing,
G/LIC/N/3/HKG/Rev.1).
TheRussian regulatory actsadopted pursuant tothese international agreements wereinitially
made available totheWTO Secretariat (seeWT/ACC/SPEC/RUS/2) intheRussian language, with
theirdescriptionsandstructuresrepresentedinAnnexes1-6inEnglish.Thiswasduetothelargevolumes
ofthese acts,aswellastothefactthattheirlistsofrespective products coincide withthose established
bytheinternational agreements inquestion
Question 46.
TheBasel Convention applies tothetrans-boundary movement ofhazardous andother wastes
andtheir disposal.
Theitems cited inWT/ACC/SPEC/RUS/2 under thisheading (HTS 340490, artificial waxes and
prepared waxes), however, areproducts, notwastes andthusshould notbesubject totheprovisionsWT/ACC/RUS/17
Page21
oftheagreement. Please explain whytheBasel Convention iscitedasajustification formaintaining
licences onthese products.
Answer
Theitems citedunder No.118inthelistinWT/ACC/SPEC/RUS/2, Annex 8,include only
some items under thetariff heading asindicated inthelist.Additionally, adetailed description isset
forth inWT/ACC/SPEC/RUS/2, Annexes 1.They demonstrate thatwhatismeant inthisparticular
caseisprecisely wastes which aresubject toprohibited listNo.1oftheBasel Convention.
Question 47.
Russia citestheMontreal Protocol asthejustification formaintaining licensing requirements on
anumber ofproducts listed inWT/ACC/SPEC/RUS/2. Theonlytrade restrictions weareaware
ofunder theMontreal Protocol, however, involve trade between parties andnon-parties. Isthe
intent ofthenon-automatic licensing tocontrol imports from non-parties?
Answer
Under theMontreal Protocol onSubstances Destroying theOzone Layer, imports ofproducts
covered bythisdocument between itsparties aretobecarried outonthebasisofnon-automatic licensing,
while suchimports from non-parties arealtogether prohibited.
TheBasel Convention onControl overHazardous Waste Trans-boundary Transportation and
ItsRemoval contains twolists.ListNo.1enumerates those substances whose imports andtransit are
banned. ListNo.2enumerates those substances whose imports andtransit aretobecarried outon
thebasis ofnon-automatic licensing.
Pursuant toRussian obligations under these Conventions, Russian import/export licensing
requirements provide thatdecisions ontheissuance ofappropriate licences inRussia aretobemade
onthebasis oftherequirements andrecommendations setforth intheVienna Convention onthe
Protection oftheOzone Layer, theMontreal Protocol, andtheBasel Convention. Among thefactors
considered, indeciding whether toissue alicence, istheforecasted balance oftheproduction and
consumption oftheproducts being licensed, andthefindings oftheState environmental impact
assessment.
Question 48.
Could Russia please explain whyandhowtheprovisions ofthese international environmental
agreements canbeusedasthebasis fornon-automatic licences orother import restrictions?
Answer
SeeAnswer 47herein.
WT/ACC/RUS/10
Question 49.
WT/ACC/RUS/10 notes therequirements andprocedures forobtaining alicence from MFER.
However, there isnoinformation regarding therequirements forobtaining letter ofconsent for
theissuance ofthelicence from thecorresponding ministry (agency). These requirements areWT/ACC/RUS/17
Page22
important since Russia states insection III.2(d) that“Animporter, thus, needs, inpractice, to
approach consecutively twoadministrative organs. ”
Please provide detailed information ontherequirements forobtaining theletter ofconsent from
these “corresponding ministries ”.
Please explain insome detail thenature andprocedure followed byanimporter tosecure permission
toimport goods subject tothistypeoflicensing. Please include reference tohowthese criteria
andprocedures areconsistent withthedisciplines oftheTBT andSPSAgreements (e.g., arethe
criteria published andavailable totraders).
Answer
Thelicensing requirements andprocedures arepublished andreadily available totraders. They
areconsistent withtheconditions oftheWTO Agreement onImport Licensing andaresimilar, for
instance,withthearrangementdescribedbytheUnitedStatesinitsanswerstothequestionnaireregarding
import licensing procedures (seeG/LIC/N/3/USA/1).
SeealsoAnswer 11herein.
Question 50.
InSection III.3. andresponse 346(WT/ACC/RUS/9), Russia states thatlicences willnotbegranted
forproducts thatrepresent athreat tothelifeandhealth ofRussia ’spopulation, wildlife, plants,
ortheenvironment.
Howisitdetermined iftheimport represents athreat? Please describe theprocess through which
suchdecisions aremade. What criteria areapplied tomake thisdetermination?
Answer
SeeAnswer 49herein.
WT/ACC/SPEC/RUS/2
Rationale forMeasures
Question 51.
Weseekfurther explanation andclarification onthereasons therequirements listed inAnnex 8
areapplied.
Answer
InAnnex 8ofWT/ACC/SPEC/RUS/2, thefulllegal reference forthereason forsuch
requirements arecontained inthecolumn entitled “Rationale forMeasure. ”
SeealsoAnswer 64herein.WT/ACC/RUS/17
Page23
Question 52.
What isthenature ofthenon-automatic requirement andwhydoesRussia maintain suchmeasures
ontheimportation ofprecious metal oresandconcentrates, itemNo.7;amalgams andcolloidal
forms ofprecious metals, itemNo.40;precious stones, metals, andjewellery covered initems
Nos.163-182; andamber andother precious metal products covered initems Nos.320-322?
Answer
Non-automatic licensing onthese items isrequired duetotheneedtomonitor thebalance on
thedomestic market bearing inmind thehistoric importance oftheseimports fortheRussian economy.
Itshould beemphasized thatsuchnon-automatic licensing isnotaccompanied byanyquantitative
restrictions andisconsistent withe rulesandprocedures ofGATT 1994andtheAgreement onImport
LicensingProcedures.Infact,suchnon-automaticlicensingiseffectivelyautomaticbecauseitisimposed
tomonitor theflowofimport ofthese products.
Question 53.
What isthenature ofthenon-automatic requirement orprohibition andwhydoesRussia maintain
such measures ontheimportation of(a)petroleum oilscovered byitems Nos. 23-4; (b)liquid
ammonia,itemNo.33;(c)plasticsandrubberproductslistedinitems130-154;and(d)theelectrical
machinery andequipment, television andsound equipment listed initems Nos.267-281?
Answer
Items Nos.23-24, 33,130-154, and280-281 inWT/ACC/SPEC/RUS/2, Annex 8,donotcover
thecorresponding commodity headings oftheHS,butonlyinclude some oftheirsub-headings whose
detaileddescriptionsareprovidedinWT/ACC/SPEC/RUS/2,Annexes1,2,5,and6.Thesedescriptions
show thatwhat ismeant inthiscaseisozone-destructive substances andhazardous wastes. Asfar
asitems Nos. 267-279 areconcerned, theproducts meant aremilitary hardware components.
More specifically:
(a) Thegoods covered byitems Nos. 23-24 areozone destroying substances orcontain such
substances. TheRussian Government hastherefore adopted Resolution oftheRussian
Government No.563“OntheRegulation oftheImportation totheRussian Federation and
theExportation fromtheRussian Federation ofOzone Destroying Substances andofProducts
Containing Them ”of8May1996 toimplement theprovisions oftheVienna Convention on
theProtection oftheOzone Layer andtheMontreal Protocol ontheSubstances Destroying
theOzone Layer.
Inorder toimport orexport ozone destroying substances and/or theproducts containing them,
alicense mustbeobtained from theMinistry ofForeign Economic Relations onthebasis of
adecision oftheMinistry oftheEnvironment andofNatural Resources (now the“Ministry
oftheEnvironment ”).Thelicenses areidentified inWT/ACC/SPEC/RUS/2 asnon-automatic
licenses because indeciding whether toissue suchlicences, theMinistry oftheEnvironment
musttakeintoconsideration notonlytheprovisions oftheVienna Convention andtheMontreal
Protocol, butalsotheforecast ofbalances oftheproduction andconsumption ofthelicensed
goods andthefindings oftheState-trading ’secological review.
(b) Thegoods covered byitemNo.33arehazardous waste substances. TheRussian Government
hastherefore adopted Resolution oftheRussian Government No.766“OntheStateRegulationWT/ACC/RUS/17
Page24
ofandControlOverHazardousWasteTransborderTransportation”of1July1996toimplement
theprovisions oftheBasel Convention ontheControl overHazardous Waste Transborder
Transportation anditsRemoval.
Inorder toimport orexport hazardous waste substances, alicense mustbeobtained fromthe
Ministry ofForeign Economic Relations onthebasis ofadecision oftheMinistry ofthe
Environment.
(c) Foradescription ofthenature ofthenon-automatic licenses foritems nos130-154, themajority
ofwhicharegoodssubjecttoResolutionoftheRussianGovernmentNo.563“OntheRegulation
oftheImportation totheRussian Federation andtheExportation fromtheRussian Federation
ofOzone Destroying Substances andofProducts Containing Them ”of8May1996, referto
Answer 60herein.
Foradescription ofthenature ofthenon-automatic licenses forthose items among nos130-154
which aresubject toResolution oftheRussian Government No.766“OntheStateRegulation
ofandControl Over Hazardous Waste Transborder Transportation ”of1July1996, referto
paragraph (b)ofthisAnswer 53.
With regard toitemNo.142,thegoods aresubject tonon-automatic licensing pursuant to
Resolution oftheGovernment oftheRussian Federation No.574“OntheApproval ofthe
Regulations fortheExport andImport ofNuclear Materials, Equipment, Special Non-Nuclear
Material andRelevant Technologies ”dated 8May1996. Boththeexport andimport regime
fornuclear materials, equipment, special non-nuclear materials andrelevant technologies is
strictly controlled duetothenature ofthegoods. Resolution No.574setsoutthespecific
licensing regime forbothimports andexports. With regard toexports, thelicenses aretobe
issued bytheMinistry ofExternal Economic Relations onthebasis ofstandards established
bytheMinistry ofAtomic Energy andoffindings oftheCommission forExport Control in
compliance withthecommitments oftheRussian Federation totheNon-Proliferation Treaty,
theGuiding Principles ofNuclear Export oftheGroup ofNuclear Suppliers andtaking into
consideration thesecurity oftheRussian Federation anditspolitical andeconomic interests.
Withregard toimports, anapplicant mustprovide totheMinistry ofAtomic Energy: alicense
application,apermitfromtheRussianFederalOfficeofSupervisionOverNuclearandRadiation
Safety, thecontract forimport ofthenuclear substances, information concerning theentity
forwhich thenuclear substance isbeing imported andanundertaking toobserve safety
measures.
(d) Foradescription ofthenature ofthenon-automatic licenses forthose items among nos267-281
which aresubject toResolution oftheRussian Government No.574“OntheApproval ofthe
Regulations fortheExport andImport ofNuclear Materials, Equipment, Special Non-Nuclear
Material andRelevant Technologies ”dated 8May1996, refertoparagraph (c)ofthisanswer.
Foradescription ofthenature ofthenon-automatic licenses forthose items among nos267-281
which aresubject toResolution oftheRussian Government No.766“OntheStateRegulation
ofandControl Over Hazardous Waste Transborder Transportation ”of1July1996, referto
paragraph (b)ofthisanswer.
Foradescription ofthenature ofthenon-automatic licenses forthose items among nos267-281
which aresubject toResolution oftheGovernment oftheRussian Federation No.879“On
theImprovement oftheSystem ofControl OverTheExport andImport oftheProducts, Works
andServices ofMilitary Application intheRussian Federation ”of4September 1995, as
amended, refertoanswer 56herein.WT/ACC/RUS/17
Page25
Those items among nos267-281 which aresubject toResolution oftheGovernment ofthe
Russian Federation No.758“OnMeasures ToImprove StateRegulation OfExport OfGoods
AndServices ”of1July1994, require export licenses only. These goods arenotsubject to
import licensing. SeeAnswer 164herein.
Question 54.
Foritems 87and88,vitamins; items 94and95,antibiotics; anditems 101and102,certain
medicaments; please explain whythese imports aresubject tonon-automatic licensing, rather
thantoautomatic licensing under certain criteria, and,insome cases, prohibitions. Inthisregard,
please describe theprovisions ofthePublic Health Ministry orders thatenforce therestrictions.
Answer
Imports ofthose medical substances andpharmaceuticals which arelisted inthequestion are
subject tonon-automatic licensing and,insome cases, toprohibitions soastoprevent substances and
pharmaceuticals which arenotauthorized foruseintheRussian Federation fromentering itscustoms
territory. Orders bytheRussian Public Health Ministry toenforce these restrictions aredictated by
concern forpublic health. AstheRussian Government understands, licensing ofimports of
pharmaceuticals andother medical preparations andsubstances ispractised bymany WTO Member
countries.
Question 55.
Arethelicensing requirements noted foritems 238-266 limited solely tosuchitems usedinthe
construction ofnuclear reactors, e.g.,thecomputers covered initemNo.251? Areallimports
ofsuch items examined, orissome other method used tolimit thescope ofapplication ofthe
licensing requirement within these categories?
Answer
Theinclusion ofitems Nos.238,254,and257intheNTM schedule isexplained bythepresence
ofthecorresponding products inrestricted listsoftheMontreal Protocol (formore details, see
WT/ACC/SPEC/RUS/2, Annexes 5and6).
Licensing requirements foritems Nos.239-250, 255-256, and258-266 arelimited solely to
nuclear equipment. Theprocedure forlicensing nuclear materials andequipment isdescribed indetail
inWT/ACC/SPEC/RUS/2, Annex 3.
Items Nos. 251and252onlyrefertoencoding andencryption equipment.
Question 56.
Please describe thenature ofthelicensing requirement foraircraft andaircraft parts initems
Nos.298and299. Does thiscover civilaircraft? Why doesRussia usenon-automatic licensing
forthese products?
Answer
Thegoods initems Nos. 298and299which aresubject tolicensing requirements arethose
ofmilitary application. These goods aresubject toResolution oftheGovernment oftheRussian
Federation No.879“OntheImprovement oftheSystem ofControl Over TheExport andImport ofWT/ACC/RUS/17
Page26
theProducts, Works andServices ofMilitary Application intheRussian Federation ”of
4September 1995, asamended. Theimport andexport ofsuchgoods requires alicense issued bythe
Ministry ofForeign Economic Relations pursuant toadecision oftheGovernment, except incertain
specified cases when suchadecision isnotrequired, which cases arespecifically setoutinResolution
No.879“OnTheImprovement OfTheSystem OfControl Over TheExport AndImport OfThe
Products, Works And Services OfMilitary Application InTheRussian Federation ”dated
4September 1995. Non-automatic licensing isapplied tothese goods duetothemilitary nature.
Question 57.
RussiastatesinWT/ACC/SPEC/RUS/2thatitisconductingasafeguardinvestigationforconsumer
electric lamps andthatconsultations inthisregard areongoing.
When willRussia initiate these consultations? Have anyrestrictions beenapplied tosuchproducts
asyet? Ifso,aretheylisted inWT/ACC/SPEC/RUS/2? Istheimport prohibition onlamps in
itemNo.277related tothis?
Answer
TheRussian Federation started consultations aspartofasafeguard investigation forsome
categories ofelectric lamps intheSummer of1996. Norestrictions haveasyetbeenapplied totheir
imports. Theinclusion ofitemNo.277inAnnex 8ofWT/ACC/SPEC/RUS/2 isduetothepresence
ofthecorresponding products inrestricted listsoftheBasel Convention.
Formore details, seealsoWT/ACC/SPEC/RUS/2, Annex 1.
WTO Justification
Question 58.
InWT/ACC/RUS/10, Russia stated thattheoperation ofitsimport licensing system wasbased
onGATT 1994 provisions, e.g., Articles VIII, X,XX,andXXI. While inmany cases such
justifications areeasily concluded given thenature oftheproduct, wehave noted anumber of
items inourreview ofAnnex 8where aWTO justification isnotobvious.
Answer
Noresponse requested.
Question 59.
Inthisregard, wenotethatRussia hasindicated thatdiscriminatory taxation isapplied toimport
ofcertain automotive products covered byitems Nos.283-296.
Please describe indetail thescope andnature ofthediscriminatory taxation, andwhyitwas
confirmed inJuly1996, wellafter Russia initiated WTO accession negotiations?
Answer
SeeAnswer 6herein.WT/ACC/RUS/17
Page27
Question 60.
Many oftheproducts inWT/ACC/SPEC/RUS/1 andWT/ACC/SPEC/RUS/2 aredenoted with
CPwhich istomean thatcertain products areprohibited under defined conditions.
Itisimportant thatexporters andimporters understand precisely theconditions under which
these measures areapplied.
Please explain indetail thedefined conditions thatwould place aproduct from theprohibited
list.
Answer
Nogoods aredenoted withtheabbreviation CPindocument WT/ACC/SPEC/RUS/1.
Itis,regrettably, extremely difficult technically toprovide afulldescription oftheproducts
listed inWT/ACC/SPEC/2, Annex 8.Thisisbecause inaccordance withtheRussian Federation 's
international obligations, products subject totherestricted listsofnuclear materials, including those
coveredbytheVassenaaraccords,theMontrealProtocol,theBaselConvention,andothers,areidentified
using notsomuch bytheirHScodes asbytheirtextual descriptions which aregenerally onetotwo
and,insome cases, fivetoseven pages longforeachitem. Forexample, afulldescription ofthe
list'sitemNo.270alone, takes upfivepages oftext.
Thefulldescription oftheproducts listed inWT/ACC/SPEC/2, Annex 8,inRussian issome
400pages long. Itstranslation intotheEnglish language hardly appears expedient fromthestandpoint
ofrational usesoflimited financial andpersonnel resources, themore soasthelarger portion ofthese
products arequite obviously subject toArticles XXandXXIofGATT, 1994. SeealsoAnswer 45
herein.
Fortheconvenience ofexporters andimporters, allthese descriptions havebeenprinted in
full,without anyexemptions, insufficiently large editions inofficial publications oftheRussian
Federation.
Question 61.
Some ofthelineitems inWT/ACC/SPEC/RUS/1 andWT/ACC/SPEC/RUS/2 areattheeight
digitlevel, some atthesixdigitlevelandsome atthefourdigitlevel. Where there isafourdigit
levelHSnumber, thesecond column often liststhatonly“certain items”areeither prohibited,
prohibited except under defined conditions orrequire anon-automatic license.
Isitpossible toprovide greater accuracy intheHScoverage oftherequirement? Ifnot,will
Russia provide theprecise criteria associate withthenon-automatic license?
Answer
SeeAnswer 60herein.WT/ACC/RUS/17
Page28
Differential Taxation forDomestic andImported Products
Question 62.
InAnnex 5ofWT/ACC/SPEC/RUS/1 andAnnex 8ofWT/ACC/SPEC/RUS/2, Russia usesa"T"
todenote thedifferential taxation fordomestic andimported products. Thislistbasically consists
ofcigarettes, alcohol, beerandnewandusedvehicles.
Thisnotation would seem tocontradict thestatement intheopening ofbothdocuments thatthe
datainthedocuments should notbeconsidered anindication ofanyobligation under theWTO
Agreement because theformulation ofsuchobligations willbethesubject matter ofnegotiations
intheframework oftheWorking Party.
TheestablishmentofnationaltreatmentforimportsisnotanegotiableissueunderWTOprovisions,
butafundamental obligation.
National treatment forimports inallmatters pertaining totheir purchase, sale,anddistribution
isoneofthepillars oftheGATT andWTO systems.
Russia should closely examine allitslawsandregulations pertaining tothese situations witha
viewtoensuring thatitseconomic andlegal system canprovide thenational treatment required
forWTO-conformity inallcases prior toitsaccession totheWTO.
Russia should statecategorically thatitwillensure national treatment forimports inthecontext
ofaccession totheWTO, without exception andwithout transition.
Answer
Noted.
Question 63.
Russia should supply adetailed description ofhowitapplies itsVAT, excise, andother internal
indirect taxes toimports andtodomestic products, including information ontheformula used
toapply thetaxandthepoint atwhich itisapplied.
Answer
Thefulltextofmany ofthese lawshavealready beentranslated intoEnglish andpreviously
providedtotheWTOSecretariat.SeeWT/ACC/RUS15andWT/ACC/RUS/15/Add.1andinparticular
LawoftheRussian Federation “OnValue-Added Tax”dated 6December 1991, asamended, and
Instruction No.39oftheStateTaxService oftheRussian Federation “Concerning theProcedure for
theCalculation andPayment ofVAT”dated 11October 1995, asamended.
SeeAnswer 6herein.WT/ACC/RUS/17
Page29
Possible Revision ofWT/ACC/SPEC/RUS/1 andWT/ACC/SPEC/RUS/2, Annexes 5and8
Respectively
Question 64.
There areseveral changes/additions thatshould bemade toWT/ACC/SPEC/RUS/1 and2,to
improve itsusefulness:
WTO-consistentjustificationsshouldbeadded,alongwithmoreelaboratedefinitionsof“prohibited
except under defined conditions ”andspecifics onthe“certain items”covered byanNTM atthe
HSfourdigitlevel.
These revisions should bemade toallow further discussion oftheissue ofNTMs.
Answer
TheRussian Federation willbeprepared toprovide additional information about itsNTM
schedule induecourse.
WT/ACC/SPEC/RUS/2 Annex 8
Question 65.
Could Russia please provide references torelevant articles etc.intheBasel Convention and
Montreal Protocol which arestated asconstituting thebasis forintroducing thevarious non-tariff
measures contained inAnnex 8?
Answer
SeeAnswers 45,47-48, and60-61 herein.
Question 66.
Ontariff lineswhere reference isnotmade tointernational contractual obligations butnational
rules, could Russia please provide in-depth information on(i)itspresent orplanned system for
export control, and(ii)allrelevant legislation relating tothenuclear energy sector.
Answer
Inaddition tothose goods whose imports areregulated inaccordance withRussian Federation 's
international commitments andonthebasis ofinternationally recognized lists, thelistincluded in
WT/ACC/SPEC/RUS/2, Annex 5,contains thefollowing categories ofproducts:
- pesticides (Government Resolution No.766,dated 1July1996);
- pharmaceuticals andmedicinal substances (Government Resolution No.854,dated
6November 1992);
- spent nuclear fuelandradioactive substances (Government Resolution No.574,dated
8May1996); and
- armaments and military hardware (Government Resolution No.879, dated
4September 1995).WT/ACC/RUS/17
Page30
Trade inthese products issubject tothose exceptions which aresetforth inArticles XXand
XXIofGATT.
Thelistalsocomprises precious stones, precious metals, andproducts made from them
(Government Resolution No.35,dated 4January 1994). Ontheseproducts, seealsoAnswer 52herein.
Anumber ofproducts wereincluded inthelistowing tothedifferent ratesofexcises forsuch
products, depending onwhether theyareimported orwereproduced domestically. Inthisconnection,
seeAnswers 6and59herein.
Theonlyandcomprehensive regulation governing theimportation ofnuclear materials and
equipment intotheRussian Federation isGovernment Resolution No.574of8May1996, which is
available attheWTO Secretariat.
Astotheexport control system inplace intheRussian Federation, itshould bestressed that
thelistinWT/ACC/SPEC/RUS/2, Annex 8,which ismeant inthequestion applies toimports rather
thantoexports.
Nonetheless, theRussian delegation reaffirms thatitssystem forexport control isconsistent
withthecriteria andrequirements ofthose international agreements andaccords inthisfieldtowhich
theRussian Federation isaparty.
Question 67.
Could theRussia please provide more information about:
(a) SINo.161(HSfrom 7017): which products areprohibited (ona6or8-digitlevel) and
what istherationale behind thisprohibition?
(b) SINo.163-182 (HS171): which products aresubject tonon-automatic licensing (ona
6or8-digitlevel) andwhat istherationale behind thismeasure?
(c) SINo.184(HSfrom 7304): which products aresubject tonon-automatic licensing (on
a6or8-digitlevel) andwhat istherationale behind thismeasure?
Answer
Therationale behind theinclusion ofitemNo.161inthelististhepresence ofthecorresponding
products inrestricted listsoftheBasel Convention (formore details, seeWT/ACC/SPEC/RUS/2,
Annex 1).
Asfarasitems Nos. 163-182 areconcerned, seeAnswer 52herein.
ItemNo.184isonthelistbecause itbelongs tothenuclear equipment category. Afull
description oftheproducts istobefound inWT/ACC/SPEC/RUS/2, Annex 3.
Non-Tariff Measures Affecting Trade inIndustrial Products
Question 68.
Thereply toQuestion 25inDocument WT/ACC/RUS/13 onalcoholic beverages andtobacco states
that"Adraft Lawiscurrently being considered bytheState Duma oftheRussian FederationWT/ACC/RUS/17
Page31
onexcise taxwhich provides forauniform method ofexcise taxcollection andintroduction of
uniform excise rates forbothdomestic goods andgoods imported intotheRussian Federation".
Willthisdraft Lawdealwiththeentire problem ofdifferential taxation asitaffects imported
vehicles? Ifnot,issome additional measure being prepared tocompletely dealwiththeissue?
Answer
SeeAnswer 6herein.
Import Licensing
Question 69.
With respect todocument WT/ACC/RUS/10, wewould appreciate clarification astowhatismeant
by"Grounds forapplying forthelicence" infield20ofthe"Sample Licence Form" which is
appended tothedocument. What typeofinformation issought?
Answer
Field 20ofanimport license istoshow thenumber anddateoftheletter ofconsent fromthe
appropriate ministry (agency) described inWT/ACC/RUS/10, aswellasthefamily name andtitle
oftheofficial whosigned thisletter consenting totheissuance ofthelicense.
State-Trading
Question 70.
(a) AdQuestion 12:CanRussia nowdefinitely affirm thatthelistofenterprises mentioned
inthisreply istobenotified totheCouncil forTrade inGoods under Article XVII?
(b) Could Russia alsoprovide usinthecoming weeks withthedraft notifications forthe
10enterprises listed?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 71.
(a) What istheratioofgovernment andprivate-sector trading inbarter trade between Russia
andCIScountries? Does theRussian Government restrict barter trade inorder tocurb
taxevasion? Ifso,what arethedetails ofsuchrestrictions?
(b) Ithasbeenreported thatthemostRussian FTOs (Federal Trade Organizations) havebeen
privatized andhave beenoperating asprofit-based enterprises. DoFTOs which arerun
bygovernment stillexist? Ifso,what industries orproducts aretheyengaged in?WT/ACC/RUS/17
Page32
Answer
(a) Aspreviously noted bytheRussian delegation, theRussian Federation 'sforeign tradestatistics
donotcollect anyseparate dataforState-owned companies andforprivate-sector companies.
Astothegovernmental regulation ofbarter dealing inforeign trade, seeAnswer 42herein
(b) Thefourforeign tradeassociations (Selkhozpromexport, Licensintorg, Tyazhpromexport and
Tekhpromimport) which havenotyetbeenprivatized, engage insupplying complete setsof
industrial production plant forexport.
Question 72.
AdQuestion 114: CanRussia reconfirm thatithasnointention ofintroducing State-trading for
agricultural products inthefuture?
Answer
TheRussian Federation reaffirms oncemore thatithasnointentions tointroduce State-trading
foragricultural products.
WT/ACC/RUS/9/Add.1
Question 73.
AdQuestion 26: According totheRussian delegation, theFederal Agency forInsolvency
(Bankruptcy) Cases maytakedecisions onlywiththerespect toState-owned companies inwhich
thefederal share (contribution) exceeds 25percent. What happens inother cases, forexample,
when theshare isunder 25percent?
Answer
TheFederal Agency forInsolvency (Bankruptcy) Cases isagovernmental agency responsible
fortheimplementation oftheState policy ofpreventing theinsolvency (bankruptcy) ofState-owned
federal enterprises andother organizations withanequity participation oftheRussian Federation.
According toPresidential Decree oftheRussian Federation No.1003“OntheReform ofState-
Owned Enterprises ”dated 23May1994, theFederal Agency forInsolvency (Bankruptcy) Cases may
make adecision ontheliquidation ofafederal State-owned enterprise andonthecreation instead of
agovernment works (government factory orfarm) onlyinrespect ofthose industrial oragricultural
federal State-owned enterprises which:
- carry onactivity permitted byFederal lawforState-owned enterprises alone;
- supply over50percentoftheirproducts (works, services) totheState; or
- arenotsubject toprivatization inaccordance with theState Programme ofthe
Privatization ofState-owned andMunicipal Enterprises intheRussian Federation.
Other federal State-owned enterprises mayonlybeliquidated andgovernment works
(government factories orfarms) setuptosucceed them ifprovided forbyfederal lawsordecrees
ofthePresident oftheRussian Federation.
Additionally, theFederal Agency forInsolvency (Bankruptcy) Cases isempowered, pursuant
toArticle7ofGovernmentResolutionNo.498“OnSomeMeasurestoRealizeLegislationonInsolvencyWT/ACC/RUS/17
Page33
(Bankruptcy) ofEnterprises ”dated 20May1994, toactonbehalf oftheState asacreditor during
decision-making ontheinsolvency (bankruptcy) oforganizations, regarding oftheirorganizational-legal
form andownership status, intheevent thatsuchorganizations default ontheirobligations tomake
paymentstothefederalbudgetorextra-budgetaryfunds.TheFederalAgencyforInsolvency(Bankruptcy)
CasesexercisesthispowerinkeepingwithprovisionssetforthintheRussianFederationLawNo.3929-1
"OntheInsolvency (Bankruptcy) ofEnterprises" dated 19November 1992andregulating procedures
whereby creditors apply tocommercial courts toinstitute insolvency (bankruptcy) proceedings against
debtor organizations.
Thepowers oftheFederal Agency forInsolvency (Bankruptcy) Cases with respect to
organizations, regardless oftheirorganizational-legal form andownership status, arealsorealized
pursuant totheProvisional Regulations ontheProcedure fortheForfeiture ofProperty ofOrganizations,
asapproved byRussian Presidential Decree No.199"OnCertain Measures toImplement Decisions
toForfeitPropertyofOrganizations,"dated14February1996.Inaccordancewithitslimitsofauthority,
asfixedbylegislative andother legalactsoftheRussian Federation, theFederal Agency forInsolvency
(Bankruptcy) Cases considers whether ornottorequest theinstitution ofinsolvency (bankruptcy)
proceedings against adebtor organization whose property isforfeited under executive documents. This
considerationisprecededbyanassessmentperformedbytheFederalAgencyforInsolvency(Bankruptcy)
Cases toevaluate thepossible consequences oftheforfeiture ofproperty oftheorganization inquestion,
including theobtaining ofdocuments anddatarequired forthiskindofassessment, andthepreparation
andserving ofnotices topersons andagencies concerned.
In1996, commercial courts intheRussian Federation considered more than2,000 cases of
insolvency (bankruptcy) oforganizations, ofwhich more than1,000 were opened onthebasis of
applications filedbytheFederal Agency forInsolvency (Bankruptcy) Cases.
Question 74.
AdQuestion 68:Thisquestion relates toAnswer 12indocument WT/ACC/RUS/9, which does
notsaywhether thelistofenterprises engaged inforeign trade thatreceive special rights is
published officially. Isthistrue? Ifso,where canthepublication beobtained?
Answer
Asnoted inAnswer 12inWT/ACC/RUS/9, thelistofenterprises which wasincluded inthe
document wastentative notification totheWTO andisnot,forthisreason, submitted asanotification
totherelevant WTO Questionnaire.
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 75.
AdQuestion 69:CanRussia explain thelegal status oftheFederal Food Corporation andwhy
itbelieves thatitisnotcovered byArticle XVII ofGATT 1994?
Answer
Detailed answers tothisquestion have already been given. SeeAnswers 355and371in
WT/ACC/RUS/4 andAnswer 116inWT/ACC/RUS/9. Itiscurrently planned toabolish theFederal
Food Corporation.WT/ACC/RUS/17
Page34
Question 76.
AdQuestion 70:Does Russia grant exclusive privileges tocertain enterprises engaged intrade
inalcoholic beverages? Ifso,could weobtain confirmation thatthose privileges areinconformity
withArticles IIIandXVIII ofGATT 1994?
Answer
Atthepresent time, inthefieldofforeign trade inalcoholic beverages, Russia doesnotgrant
exclusive privileges covered byArticle XVII ofGATT 1994 toanyenterprise.
Question 77.
AdQuestion 72:What isthesituation regarding thelistof3,000 strategic State enterprises that
Russia intends nottoprivatize? Thereply toquestion 2mentions thatthelisthasnotyetbeen
published. Isthisstillthecase?
Answer
TheRussianGovernmentinitsResolutionNo.802“OntheListofEnterprisesandOrganizations
oftheDefense Sector, ThePrivatization ofWhich IsProhibited ”of12July1996(which wasclassified
"Notforpublication inthepress"), updated thelistofenterprises andorganizations inthedefense sector
which maynotbeprivatized. Resolution No.802andthelistofsuchfacilities, including 480new
enterprises andorganizations, wassubsequently published inIssueNo.13ofthePanorama Privatizatsii
(Privatization Panorama) magazine forSeptember 1996.
WT/ACC/RUS/13/Add.1
Question 78.
AdQuestion 144: What aretheexclusive rights granted tothe10enterprises mentioned in
question 12ofdocument WT/ACC/RUS/9?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Concerning Russia 'sprivatization programme
Question 79.
Recognizing thatnotallState-owned enterprises canbeconsidered State-trading enterprises for
thepurposes ofnotification under Article XVII ofGATT 1994, could Russia provide theWorking
Party withanupdate onthestatus andprogress ofitsprivatization programme during 1995and
1996?
Answer
Thecurrent phase ofprivatization inRussia follows thecompletion ofthehistoric-scale
privatization drive inJuly1994, which resulted inamassive redistribution ofproperty, gaveriseto
acorporate economic sector, andspawned anational securities market. Asaresult oftheimplementation
ofRussia 'sStateProgramme forPrivatization, thecountry had,asofthemiddle of1996, more thanWT/ACC/RUS/17
Page35
122,000 privatized companies, which represented 60percentofthetotalnumber ofState-owned
enterprises inbusiness atthestartofprivatization efforts (in1992). These companies produce some
68percentofthenation 'sGross National Product. In1995, approximately 10,200 additional enterprises
inRussia were privatized. In1996, according topreliminary data, another 2,614 enterprises were
privatized.
Theprivatization oftrading enterprises waspractically completed bythebeginning of1996.
Whereas only76.5percentofthem wereprivatized asofOctober 1994, 84.1percentofalltrading
enterprises inthewholesaling sector and96.3percentofalltrading enterprises intheretailing sector
were privatized asof1January 1996.
Concerning Purchases forState Needs
Question 80.
Could Russia clarify theprocess bywhich concessional State-trading credit isprovided tothe
CityofMoscow forcentralized foodimports. Forexample, isthere acompetitive bidprocess
forthepurchases, which istransparent, bywhich importers areselected tomake these purchases?
What other cities/regions inRussia receive preferential credit topurchase foodstuffs?
Answer
Pending
Question 81.
How arethequantities ofimports forcentralized regions determined? Arethere requirements
ontheorigin (Russia orCIS) orother characteristics inorder toreceive preferential credit?
Answer
Pending
Question 82.
What kindoftaxorother exemptions doRussian organizations, suchashumanitarian orother
special interest groups receive?
Answer
Nonewindividual customs privileges havebeenaccorded intheRussian Federation since1995.
Allearlier granted privileges ofthiskindarebeing phased out.
Customs andtaxprivileges inforeign trade arecurrently granted strictly inaccordance with
LawNo.1992-1 "OnValue-Added Tax" dated 6December 1991, asamended andLawNo.5003-1
"OntheCustoms Tariff" dated 21May1993, asamended. Humanitarian aidsupplies, forinstance,
areexempted from customs duties.
Allbenefits ofthissortaredetailed intheabove lawswhose textsweremade available tothe
WTO Secretariat in1994-96 (seeWT/ACC/RUS/2, RUS/12, RUS/15, andRUS/15 Add.1).WT/ACC/RUS/17
Page36
Question 83.
Please listtheenterprises thatconduct thistrade onbehalf oftheGovernment oftheRussian
Federation.
Answer
Russia doesnothaveanyorganizations orenterprises conducting special privileged foreign
tradeonbehalf oftheGovernment oftheRussian Federation. There arenoindividual (thatisforspecial
entities) taxorcustoms privileges intheforeign trade ofRussia. There areState-trading enterprises
which haveprivileges inaccordance withGATT 1994, Article XVII.
SeealsotheInformation onState Trading Enterprises oftheRussian Federation.
Concerning State Trading Enterprises
Question 84.
InWT/ACC/RUS/9, reply 12,Russia identifies 10national State-trading enterprises (STEs) that
receive special trading rights orother benefits orprivileges from theGovernment oftheRussian
Federation, andindicates thatthisisitspreliminary listofentities tobenotified under Article
XVII. Wewould greatly appreciate more information onhowthese firms operate withregard
toimports andexports intheir sector.
Answer
SeeAnswer 74herein.
SeealsotheInformation onState Trading Enterprises oftheRussian Federation.
Question 85.
HasRussia subsequently determined anyother enterprises thatspecial rights orprivileges and/or
should benotified asState-trading enterprises under Article XVII?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 86.
Arethere anyother suchentities operating attheregional oroblast levelwhich holdspecial rights
orprivileges?
Answer
TheRussian Government isnotaware ofanysuchorganization orenterprise operating atthe
regional level.
SeetheInformation onState Trading Enterprises oftheRussian Federation.WT/ACC/RUS/17
Page37
Question 87.
Foreachoftheenterprises listed inWT/ACC/RUS/9 andanysubsequent enterprises identified
asSTEs, andforeachproduct thatRussia identifies assubject toState-trading, please complete
andsubmit forWorking Party review prior tothenextWorking Party meeting theinformation
requested inAnnex 6ofWT/ACC/1, thequestionnaire onState-trading. Webelieve thatthis
would greatly facilitate thediscussion ofthistopic intheWorking Party.
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 88.
Please identify thespecial rights orprivileges conferred onthese enterprises byRussia andthe
government agency orministry thatisresponsible fortheenterprise. What aspects ofthese
enterprises distinguish their activities from those ofother State-owned firms? How were these
companies selected tomaintain STEstatus?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 89.
Doanyformer STEs (such asExportkhleb orProdintorg) continue toreceive anyspecial treatment
inthewayofcredit, tariff exemptions, etc.from theRussian Federation oranysub-central
authority? Does theGovernment oftheRussian Federation conduct purchases forState needs
through these former STEs and,ifso,howareState contracts forthese purchases granted?
Answer
IntheopinionoftheRussianGovernment,formerStateTradingEnterprises(suchasExportkhleb
orProdintorg) donotpresently enjoy anyexclusive rights orprivileges within themeaning of
Article XVII ofGATT 1994. TheGovernment oftheRussian Federation doesnotconduct import
purchases forState needs through these organizations.
Question 90.
Could Russia please explain howbulk commodities, such aswheat andcorn, areexported?
Specifically, could Russia explain thechannels through which domestic production isprocured
andprepared forexport, andidentified entities engaged inexport trade? Areanyoftheentities
engaged insuch trade granted special rights orprivileges bytheRussian Federation orany
sub-central authority?
Answer
Exports ofwheat andcorninrecent years havenotbeenverysignificant. Russia isalarge
netimporter ofthese products. Commodities mentioned inthequestion aredelivered forexport by
private firms onthebasis ofmarket principles. Several hundred firms inRussia undertake thiskind
ofbusiness.WT/ACC/RUS/17
Page38
Several hundred firms inRussia undertake thiskindofbusiness. Neither federal norsub-central
authorities grant such entities anybenefits orprivileges within themeaning ofArticle XVII of
GATT 1994.
Question 91.
Does Russia have anyadditional entities, whether private orState-owned, ateither thefederal
orsub-central level, toaddtothepreliminary listofSTE’spresented inthereply toquestion
12ofWT/ACC/RUS/9?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
SeealsoAnswer 74herein.
Question 92.
Inresponse toquestion 355inWT/ACC/RUS/4, Russia described “Rosagrosnab ”asajointstock
company engaged incommercial deliveries offuels, lubricants, seeds, fertilizers, etc.
What isthedifference intherelationship oftheGovernment oftheRussian Federation with
Rosagrosnab andwiththose joint stock companies identified asState-trading enterprises inthe
response toquestion 12inWT/ACC/RUS/9?
Answer
Thedifference isthattheGovernment oftheRussian Federation doesnotaccord toJSC
Rosagrosnab anyspecial rights orprivileges within themeaning ofArticle XVII ofGATT 1994.
Moreover, JSCRosagrosnab doesnotactinthefieldofforeign trade.
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 93.
Inprevious documentation, e.g.,WT/ACC/RUS/2, RUS/4 andRUS/9, Working Party members
have asked forstatistics onthepercentage ofRussia ’strade, import andexport, accounted for
byState-owned orprivate enterprises. Thereply hasoften been thatRussia doesnotcollect
statistics ofthisnature, except intheresponse toquestion 356inWT/ACC/RUS/4 where theanswer
wassaidtobe"pending."
What, ifany,statistics canRussia nowprovide inresponse tothisrequest bytheWorking Party
members?
Please provide import and export data fortheState-trading enterprises identified in
WT/ACC/RUS/9.
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.WT/ACC/RUS/17
Page39
Questions onGazprom
Question 94.
What istherelationship between thegovernment andGazprom?
Answer
According toPresidential Decree oftheRussian Federation No.1333“OntheTransformation
ofState GasConcern Gazprom intoGazprom Russian Joint-Stock Company ”of5November 1992
(“Decree No.1333") theGovernment oftheRussian Federation wasinstructed toestablish theRussian
Joint-Stock Company Gazprom (“Gazprom ”)anditsauthorized capital wasprovided asfollows:
- 100percentofthecapital oftheenterprises consisting oftheassets oftheUnified System
ofGasSupply heldinfederal ownership (listed inAnnex 1toDecree No.1333);
- controlling interests ofthenewly-established joint-stock companies (listed inAnnex 2to
Decree No.1333); and
- participation quotas (shareholdings) belonging totheStateGasConcern ofGazprom andnot
prohibited from privatization.
According toDecree No.1333, atthetimeofestablishment ofGazprom, 100percentofits
shares belonged totheRussian Federation andwithin three years afterGazprom ’sfoundation the
shareholding oftheRussian Federation hadtobenotlessthan40percentofGazprom ’sshares. This
period offederal ownership ofGazprom shares wasextended forthree more years until1999 by
Presidential Decree oftheRussian Federation No.399of20March 1996. Further, Presidential Decree
oftheRussianFederationNo.599“OntheProlongationofthePeriodofValidityoftheTrustAgreement
FortheFederally Owned Shares Between theGovernment oftheRussian Federation andtheRussian
JointStock Company Gazprom ”of22April 1996extended forthreemore years until1999theperiod
ofvalidity ofthetrustagreement for35percentofthefederally owned shares oftheRussian Federation
inGazprom.
Gazprom isalsothesuccessor inlawtotheproperty rights andduties ofState GasConcern
Gazprom, including itsrights oflanduse,itssubsoil andmineral resources, andtherights andduties
under thecontracts concluded bytheConcern.
Question 95.
What roledoesthegovernment playonGazprom ’sboard ofdirectors?
Answer
TheRussian Government isempowered toform theBoard ofDirectors andinclude inits
membership representatives ofStateadministrative bodies pursuant toPresidential Decree oftheRussian
Federation No.1333.
APresidential Order oftheRussian Federation No.58-RP of26January 1993“OntheBoard
ofDirectors ofRussian Joint-Stock Company Gazprom andonFloating ItsShares Among Citizens
oftheRussian Federation ”asamended byPresidential Decree oftheRussian Federation No.599“On
theProlongation ofthePeriod ofValidity oftheTrust Agreement FortheFederally Owned Shares
Between theGovernment oftheRussian Federation andtheRussian JointStock Company Gazprom ”WT/ACC/RUS/17
Page40
dated 22April 1996 provides thattheChairman oftheBoard ofDirectors ofGazprom andofficials
ofthecentral bodies offederal executive authority included intheBoard ofDirectors asthe
representatives oftheState, shallvoteatmeetings ofshareholders withshareholdings belonging to
theRussian Federation. TheBoard ofDirectors ofGazprom, asspecified bytheCompany Charter,
isempowered totakedecisions byasimple majority vote. Theinitial membership oftheBoard of
Directors ofGazprom, pursuant toPresidential Order No.58-RP asamended, includes two
representatives ofGazprom, members ofthework collectives andthemanagement oftheenterprises
oftheRussian Unified Gas-Supply System andrepresentatives ofState administrative bodies.
Question 96.
Does thegovernment getashare ofGazprom ’sprofits?
Answer
Asashareholder ofGazprom, theRussian government isentitled todividends inrespect of
itsshareholding.
SeealsoAnswers 94and97herein.
Question 97.
What areGazprom ’sspecial rights orprivileges ininternational trade?
Answer
SeetheInformation onState Trading Enterprises oftheRussian Federation.
Question 98.
IsGazprom abletoblock imports form other oil-producing countries?
Answer
No,Gazprom cannot block anyimports from other oil-producing countries.
Questions onOther Firms
Question 99.
TheMinistry ofFuelandEnergy hasappointed seven “export coordinators ”tofacilitate Russian
exports ofoil.While thesystem ofcoordinators isintended toimprove efficiency, thenew
arrangements appear togivethecoordinators agreater roleinexport prices andvolumes.
DoesRussia intend toinclude theseven oilexport coordinators initsresponse tothequestionnaire
onState-trading?
Answer
Theroleofacoordinator doesgiveanoilcompany anyadvantages either inthewayofincreases
initsexports or,themoreso,inthewayofexport prices. TheRussian StateAnti-Monopoly Committee
alsomonitors surveillance ofthese measures andmaintains avigilant watch. ThisiswhytheinclusionWT/ACC/RUS/17
Page41
ofacompany onalistofcoordinators (which isalsofairly frequently reviewed) doesnotmean its
automatic inclusion onthelistofSTEs.
Question 100.
DoestheAfghan WarInvalids 'Foundation referred tointhereply toadditional question 55retain
tariff and/or other privileges concerning import ofcertain products? Ifso,please describe.
Answer
TheAfghan WarInvalids 'Foundation doesnotpresently enjoy anybenefits andprivileges
inthefieldofforeign trade.
Question 101.
Since thereply toadditional question 65wasprovided, hasthere been anyfurther progress in
developing acentralized source forpublishing information about federal tenders?
Answer
No.
Intellectual Property Rights (documents WT/ACC/RUS/9 andAdd.1 andWT/ACC/RUS/13)
Copyright andRelated Rights
Question 102.
Article 28(3) oftheLawoftheRussian Federation No.5351-1 of9July1993 onCopyright and
Neighbouring Rights states "The Government oftheRussian Federation mayestablish cases where
special deductions shall bepaidforusesintheRussian territory ofworks inpublic domain."
Please giveexamples forsuchapractice.
Answer
TheRussian Federation hasnotsofarexercised thisright, which iswhyanexample ofsuch
apractice doesnotexist.
Question 103.
Please specify indetail theprovisions intheRussian Copyright Actwhich maylimittheexclusive
right oftherightholder (Article 13oftheTRIPS Agreement).
Answer
These provisions havebeenspecified indetail inWT/ACC/RUS/7 onpage6.
Question 104.
Howisthenotion "normal exploitation ofthework" defined intheCopyright Actorother related
laws(Article 13oftheTRIPS Agreement)?WT/ACC/RUS/17
Page42
Answer
Russian legislation doesnotmake useofthenotion "normal exploitation ofawork." None
oftheprovisions inArticles 18-26 oftheRussian Federation Law"OnCopyright andRelated Rights"
appears tobebytheirnature inanyconflict withthenormal exploitation ofawork, which iswhya
literal reproduction inRussian legislation ofthewordings contained inTRIPs Article 13isnotnecessary.
Trademarks andService Marks
Question 105.
(a) AsmentionedunderitemNo.103ofdocumentWT/ACC/RUS/9/Add.1"RussianFederation
legislation doesnotestablish anyspecific criteria forrecognizing atrademark tobewell-
known. Russia iscurrently involved inwork conducted inthisfieldbytheWIPO." Please
indicate theresults ofthework conducted sofar.
(b) Does theRussian Government have asystem toprevent infringement offamous foreign
trademarks anddesigns? What isthestatus ofprotection forfamous foreign trademarks
inRussia?
(c) Howclosely doestheleveloftrademarks protection under Russia ’strademark lawreflect
theWTO TRIPs regulations? What isthelevelofWTO-consistency forpatent protection?
Answer
(a) TheWIPO Committee ofExperts hasbynowheldtwomeetings onthisissue andproceeded
todiscussing thecriteria ofbeing well-known.
(b) Clause 1ofArticle 2oftheRussian Federation LawNo.3520-1 "OnTrademarks, Service
Marks, andAppellations ofOrigin" dated 23September 1992, provides fortheprotection of
trademarks without theirregistration byvirtue ofinternational treaties, which alsoapplies to
famous trademarks. They areprotected byresorting tojudicial procedures.
(c) Thelevel oftrademarks protection under theRussian Federation Law No.3520-1 "On
Trademarks, Service Marks, andAppellations ofOrigin" dated 23September 1992, appears
toreflect theWTO TRIPs regulations inpractically every respect (with afewexceptions which
mayberemoved bytheveryfactofRussia acceding toTRIPs which willthenbecome directly
applicable, asgenerally described inAnswer 18herein).
Question 106.
Please explain whether colours areregistrable astrademarks under Russian trademark law,absent
combination withaccompanying figurative elements, asrequired byTRIPS Article 15.1.
Answer
ColoursarenotcurrentlyregistrableastrademarksundertheRussianFederationLawNo.3520-1
"OnTrademarks, Service Marks, andAppellations ofOrigin" dated 23September 1992. Itshould
benoted thatTRIPs Article 15,clause 1requires thatonlycombinations ofcolours beeligible for
registration, rather thansingle colours.WT/ACC/RUS/17
Page43
Question 107.
Please explain whether thenature ofgoods orservices towhich atrademark istobeapplied can
serve asanobstacle totheregistration ofthemark under Russian law. Ifso,please identify and
explain thesubject matter excluded under thisauthority, therelative provisions oftheRussian
lawthatserve asabasis forthese conclusions, andhowthispractice complies with TRIPS
Article 15.4.
Answer
Thenature ofgoods orservices towhich atrademark istobeapplied cannot serve asanobstacle
totheregistration ofthemark under Russian law.
Question 108.
Please explain, whether theRussian trademark lawestablishes apresumption oflikelihood of
confusion inthedetermination ofconfusing similarity incases where identical marks areused
onidentical goods, asrequired byTRIPS Article 16.1. Ifso,please identify andexplain thelegal
basis forthispresumption.
Answer
Article 4,clause 2oftheRussian Federation LawNo.3520-1 "OnTrademarks, Service Marks,
andAppellations ofOrigin" dated 23September 1992, directly stipulates thatsuchcases constitute
aninfringement ofthetrademark owner 'srights, andthisiseffectively tantamount tothepresumption
referred tointhequestion.
Geographical Indications
Question 109.
Pleaseindicatewhethergeographicalindicationsforwinesandspiritsaregivenadditionalprotection
compared togeographical indications forother goods. Ifnot,please explain howRussian law
isconsistent withTRIPS Article 23.
Answer
Theways inwhich geographical indications areprotected arediscussed inWT/ACC/RUS/7
onpages 10-11. Theadditional protection forgeographical indications forwines andspirits, which
isprovided forbyArticle 23ofTRIPs (subject totheexceptions stipulated inArticle 24),isensured
byRussian legislation forallcategories ofproducts.
Enforcement ofIntellectual Property Rights
Question 110.
Please explain thecriminal andcivilremedies available forcopyright infringement andtheextent
towhich theyfullyimplement theobligations inTRIPS Articles 41,45,50and61.Intheresponse,
please specify, interalia,whether these remedies mayinclude theseizure, forfeiture anddestruction
ofinfringing articles andequipment usedtomake theinfringing articles, asrequired byArticles 46
and61,andthemanner inwhich thegrant ofcivilprovisional relief isprovided inaccordance
withTRIPS Article 50.WT/ACC/RUS/17
Page44
Answer
Pending
Question 111.
When willtheRussian Federation determine which agency hasleadresponsibility forcopyrights
andrelated rights, perquestion 88ofWT/ACC RUS/9/Add.1?
Answer
Pending
Question 112.
Does theRussian Federation intend toempower anagency toissue compulsory licenses forthe
useofpatents (with reference totheresponse toquestion 119ofWT/ACC/RUS/9/Add.1)?
Answer
Twoalternative options fordealing withthismatter arecurrently being studied, namely:
(i) theestablishment ofanewagency which willperform thisandsome other functions included
within thelimits ofauthority oftheHigher Patent Chamber; and
(ii) thedelegation ofthecompetence toissue compulsory licenses tocourts.
Nodeadline hasasyetbeensetformaking thefinaldecision onthisscore.
Question 113.
Inreplying toQuestions 375and388ofWT/ACC/RUS/4, regarding thesteps theRussian
Federation would taketocomply withtheAgreement onTrade-Related Aspects ofIntellectual
Property Rights (TRIPs Agreement), itwasstated thatthismatter would beexamined inmore
detail aspartofwork onlegislation amending current Russian intellectual property lawandthat
thatwork would becompleted thisyear.
What amendments have been identified asneeded andwhen willlegislation making those
amendments beintroduced?
Answer
SeeAnswer 8herein, additional work isstillongoing.
Question 114.
TheRussian Federation joined theBerne Convention fortheProtection ofLiterary andArtistic
Works inMarch of1995, withstatement thatprovisions donotapply toworks which werepublic
property ontheterritory oftheRussian Federation onthedateofentry intoforce. Article 18
oftheBerne Convention, incorporated byreference inArticle 9.1oftheTRIPs Agreement, requires
thattheobligations oftheBerne Convention apply toallworks which arestillprotected under
copyright intheir country oforigin.WT/ACC/RUS/17
Page45
What steps istheRussian Federation taking tocomply with thisrequirement oftheBerne
Convention?
Answer
TheRussianFederationisawarethatfollowingitsaccessiontotheWTO,itwillhavetointroduce
retroactive protection forcopyright works andphonograms inaccordance withtheTRIPs Agreement.
Thespecific timeperiod during which suchprotection willbeputinplace should besetinthecourse
ofnegotiations, taking account, since thematter atissue isanexception from national treatment and
m.f.n. treatment, ofthefactthatthemaximum transitional period permitted bytheTRIPs Agreement
isoneyear.
Question 115.
Article 14.1oftheTRIPs Agreement requires thatprotection berestored forperformers and
phonogram producers whose performances andphonographs arestillprotected intheir country
oforigin.
What stepswillbetaken torestore protection forperformers andphonogram producers asrequired
bytheTRIPs Agreement?
Answer
SeeAnswer 114herein.
Question 116.
ThePresident oftheRussian Federation issued adecree altering thestatus oftheState Committee
forPatents andTrademarks (ROSPATENT).
Please describe thechanges made bythedecree andprovide achart showing theorganization
asitnowexists.
Thefeescharged bytheROSPATENT toobtain andmaintain apatent intheRussian Federation
areamong thehighest intheworld. Such highfeesmake itimpossible forsmall entities, including
small Russian entities, toobtain patent protection intheRussian Federation.
What steps arebeing taken tochange thissituation inorder toencourage thedevelopment of
theuseful artsintheRussian Federation?
Answer
Theorganization chart andfunctions oftheRussian Agency forPatents andTrademarks are
stillbeing defined. During theperiod oftransition, theAgency willretain thesame structure and
functions asitspredecessor, theCommittee forPatents andTrademarks.
Asfarasfeesareconcerned, thefeecharged forfiling patent application withmultiple claims
ishigh. Thepossibility oflowering iscurrently being explored.WT/ACC/RUS/17
Page46
Question 117.
Inthedescription ofsubstantive rights ofcopyright intheRussian Federation contained in
WT/ACC/RUS/7, rental rights arenotlisted among therights ofacopyright owner orof
phonograms producers. Articles 11and14.4oftheTRIPs Agreement respectively mandate that
suchrights beprovided.
Dotheowners ofcopyrighted computer programs, cinematographic works andphonograms have
arental right intheir works orphonograms under Russia ’scopyright law? Ifnot,what plans
arethere foramending thelaw?
Answer
Rental rights areprovided forbyRussian legislation among theexclusive rights ofauthors,
phonogram producers, andother copyright andrelated rights owners. InWT/ACC/RUS/7, onpage5,
these rights were mistranslated as"leasing" rights.
Question 118.
Inthedescription ofsubstantive rights oftrademarks andservice marks, itstates thatregistration
willberefused tosigns intended astrademarks ifsuchsigns reproduce marks well-known inthe
Russian Federation, which areowned bypersons whoacquired theright tothemark prior to
thedateonwhich theapplications inquestion wasfiled.
Please describe theprocedure andthestandard bywhich ROSPATENT determines whether a
mark iswell-known.
Answer
Determinations ofwhether amark iswell-known currently mayonlybemade byacourt. We
arenotaware ofanycases ofcourts having beenapproached tomake suchdeterminations.
Question 119.
How often does ROSPATENT publish information regarding thetrademarks thathave been
registered?
Answer
Theofficial bulletin ofregistered trademarks ispublished onamonthly basis.
Question 120.
What istheaverage pendency foratrademark application before ROSPATENT?
Answer
From oneyeartooneandone-half ayear.WT/ACC/RUS/17
Page47
Question 121.
TheHigh Patent Chamber istohear cases appealed from theChamber ofAppeals; however,
theHigh Patent Chamber hasnotbeen established.
How areappeals from theChamber ofAppeals being handled currently? When willtheHigh
Patent Chamber becreated?
Answer
Appeals fromtheChamber ofAppeals arecurrently handled bycourts, withsuchcomplaints
filedbylegalentities andentrepreneurs, including foreign ones, taken upbytheMoscow CityCourt
ofArbitration, andthose filedbyindividuals whoarenotentrepreneurs bythecorresponding courts
ofgeneral jurisdiction. SeealsoAnswer 112herein.
Question 122.
Article 34oftheTRIPs Agreement requires thathave theauthority toshifttheburden ofproof
tothedefendant inapatent infringement caseinvolving aprocess patent where theaccused product
isidentical withthatproduced bythepatented process andtheproduct isneworitissubstantially
likely thattheprocess wasusedandthepatent owner, using reasonable efforts, hasbeenunable
todetermine theprocess actually used.
DoRussian courts apply thistransfer oftheburden ofproof inappropriate cases? Hasanytraining
been done tofamiliarize judges withtheconcepts?
Answer
Currently, Russian legislation (Clause 3ofArticle 10ofthePatent LawoftheRussian
Federation) doesprovide forsuchtransfers. Ifanylegal precedents ofthiskindexist, theyarenot
widely known. Asfarasjudicial training isconcerned, technical assistance byWTO Member countries
inthisareawould bewelcome.
Question 123.
Inthedescription ofthesubstantive rights inconnection withpatents, reference ismade tothe
ability ofthird parties torequest examination ofapending patent application.
Ifsucharequest ismade, whoisresponsible forpaying theexamination fee? Isthethird party
given anyinformation about theexamination oronlythepatent applicant?
Answer
Thefeeispayable bytheparty requesting suchanexamination. Correspondence onthemerits
ofanapplication isconducted onlywiththeapplicant.
Question 124.
TheRussian Federation hasnotyetbecome amember oftheConvention fortheProtection of
NewVarieties ofPlants.WT/ACC/RUS/17
Page48
What isthetimeframe within which Russia intends tojointhisConvention? Ifsuchplans do
notexist, whynot?
Answer
Pending
Question 125.
Thetermofprotection forselection attainments is30years afterregistration butforcertain plants.
What istherational forthelonger term ofprotection forgrapes, decorative trees, fruitcrops,
andforest trees?
Answer
Pending
Question 126.
Article 36oftheTRIPs Agreement requires thatright-holders inintegrated circuit layout designs
havetheright toprevent unauthorized persons from importing, selling, orotherwise distributing
forcommercial purposes articles incorporating anintegrated circuit containing aprotected layout
designs.
Please explain howtheRussian Federation ’slaw“OnLegal Protection ofIntegrated Circuit
Topology ”conforms withthatrequirement.
Answer
Inaccordance withArticle 5,clause 3andArticle 8,clause 1oftheRussian Federation Law
No.3526-1 "OntheLegal Protection ofLayout-Designs ofIntegrated Circuits" thefollowing actions,
committed without theconsent oftheauthor orother rightholder, areviolations ofthelatter'sexclusive
righttousethelayout-design ofanintegrated circuit:
- copying thelayout-design, infullorinpart,byincorporating itintotheintegrated circuit or
otherwise, withtheexception ofthecopying ofthatpartofthelayout-design which isnot
original; and
- use,importation, offer tosell,sale,andanyother economic useofthelayout-design orthe
integrated circuit incorporating thesame.
Theuseoflegally acquired integrated circuits orproducts incorporating suchintegrated circuits,
provided thattheparty making suchusedidnotknow andwasnotsupposed toknow thatsaidintegrated
circuits orproducts incorporating themhadbeenmanufactured andwerebeing distributed inviolation
oftheexclusive right tousethelayout-designs concerned, isnotaninfringement ofsuchexclusive
right. After being appropriately notified bytheowner ofrights inthelayout-design, thisparty isto
payadequate compensation foreachintegrated circuit andeachproduct incorporating suchintegrated
circuit.WT/ACC/RUS/17
Page49
Question 127.
InRussia 'sdescription ofitslegal provisions onsubstantive rights relating toundisclosed
informationinWT/ACC/RUS/7,itisstatedthatlegislationisneededtoprovideadequateprotection
forsuchinformation beyond thatwhich iscurrently available.
Hassuch alawbeen drafted andintroduced? Ifnot,when willsuch alawbedrafted and
introduced?
Answer
Such alawhasbeendrafted andsponsored intheState Duma byagroup ofitsdeputies. It
isnotpossible topredict withcertainty when itwillbeenacted.
Question 128.
Inthediscussion inWT/ACC/RUS/7 ofremedies forinfringement ofintellectual property rights,
Russia refers only todamages which theperson using undisclosed information without
authorization.
Does thismean theitisnotpossible foracourt toorder thedefendant tocease theunauthorized
useoftheinformation, inaddition toordering thedefendant topaydamages? Ifthisisthecase,
what plans arethere foramending thelawtoprovide courts withtheauthority toenjoin the
unauthorized useofundisclosed information?
Answer
Inaccordance withthestill-effective Article 151oftheFundamentals ofCivil Legislation of
theUSSR andConstituent Republics, theproprietor oftechnical, organizational, orcommercial
information constituting aproduction (know-how) secret has,provided thathecomplies withthe
corresponding conditions, therighttoprotection against anyillegal useofsuchinformation bythird
parties. Thisisprecisely theremedy thatthequestion asksabout.
Question 129.
Concerning theactivities oftheAnti-Monopoly Committee toprotect against theunauthorized
disclosure ofconfidential information orviolation ofintellectual property rights asatypeofunfair
competition (perWT/ACC/RUS/7):
What isthesizeoftheCommittee 'sstaff?
How areinvestigations conducted inconnection with unfair competition, such asmisuse of
trademarks orprotection ofundisclosed information. Please describe indetail theprocedures
followed bytheAnti-Monopoly Committee ininvestigating acomplaint, including theopportunity
given parties toparticipate intheproceedings, theevidence thatmust beproduced orthatis
acceptable toproduce andtheform ofthedecision rendered.
What have been theaccomplishments oftheCommittee since thefirsthalfof1995?
Answer
PendingWT/ACC/RUS/17
Page50
Question 130.
Court cases intheRussian Federation involving intellectual property rights appear totakeplace
overaperiod ofyears anddelays arefrequent. Insome instances, hearings scheduled farin
advance arecancelled onthedaytheyaretotakeplace, causing considerable waste ofbothtime
andmoney ofparties whohave flown toRussia toparticipate. Onecourt found ithadno
jurisdictiontoaddressacasebecausejurisdictionwasgiventheHighPatentChamberbylegislation.
Because theHigh Patent Chamber doesnotexist, theplaintiff wasleftwithout aremedy.
What isbeing doneintheRussian Federation toaddress these problems, which mustaffect Russian
citizens asmuch astheydoforeigners?
Answer
Pending
Question 131.
TheInterdepartmental Commission fortheEnforcement ofIntellectual Property Rights thatthe
Russian Federation established tocoordinate theefforts ofthevarious governmental bodies has
been inexistence fornearly ayear.
What have been theaccomplishments oftheCommission inreducing copyright piracy and
trademark counterfeiting? What aretheCommission ’splans forthenexttwoyears?
Answer
Asaresult ofactions taken bygovernmental agencies, primarily police raids, aswellasstiffer
criminal penalties ineffect fortherespective offenses since 1January 1997, piracy levels havebynow
perceptibly dropped. Oninstructions from theRussian government, anumber ofministries and
departmentsarecurrentlydiscussingwaysofmoreeffectivecooperationincombatingthistypeofcrime.
Question 132.
Inresponse toquestion 454ofWT/ACC/RUS/4, theRussian Federation identified three main
problemsfacedbythoseresponsibleforenforcementofintellectualpropertyrights:(i)theweakness
ofthelaw-enforcement system ingeneral; (ii)theinefficiency oftheexisting legislation onthe
arrest ofimported counterfeit goods; and(iii)theabsence ofclarity intheissue ofretroactive
protection offered totheholders ofcopyright andneighbouring rights.
Please describe thesteps theRussian Federation hastaken toreduce oreliminate these problems.
What steps areplanned forthenexttwoyears?
Answer
Pending
Question 133.
Section 4(e)onenforcement inWT/ACC/RUS/7 states thatnewrules governing criminal liability
fortheviolation ofintellectual property rights entered intoforce on1October 1995, providing
criminal penalties forcopyright violations.WT/ACC/RUS/17
Page51
What enforcement efforts haveresulted from thisnewlaw? How many prosecutions havebeen
initiated?
Answer
Pending
Question 134.
What other steps isRussia taking toimprove IPRenforcement?
Answer
Pending
Question 135.
In1995, theRussian Federation reported thatFederal LawNo.110-FZ of19July1995 made
criminal cases involving copyright infringement apublic offense andgavejurisdiction toinvestigate
offenses totheMinistry forInternal Affairs.
Please describe anysuchcases investigated bytheMinistry ofInternal Affairs todate, andindicate
whether those investigations resulted inlegal action, andifso,theresult oftheaction.
Answer
Pending
Question 136.
What plans existforintroducing legislation thatwould givecustoms authorities theauthority to
actattheborder toseizecounterfeit trademarked goods andpirated copyrighted works? When
isthislegislation expected tobeintroduced?
Answer
Pending
Question 137.
WT/ACC/RUS/7, regarding enforcement ofintellectual property rights, states thatthearbitration
courts andthecourts ofgeneral jurisdiction bothcanhearintellectual property cases, depending
onthestatus oftheparties. There arenomeans, however, forresolving differences in
interpretation ofthelawbetween these twoseparate court systems.
What plans existtodevelop asystem forresolving differences ofinterpretation ofthelaws, since
amending thelawwillnot,inthelongrun,resolve theproblem?
Answer
PendingWT/ACC/RUS/17
Page52
Question 138.
ConcerningthenewCriminalCodeoftheRussianFederationtobeimplementedon1January1997,
andwithreference tothereply toquestion 181ofWT/ACC/RUS/9:
Please confirm thatthiswilloccur, anddescribe itsprovisions regarding intellectual property
rights (IPR) andthepenalties provided for.
Answer
ThenewCriminal Code entered intoforce on1January 1997. Thefollowing articles are
specifically related toproviding increased IPRprotection:
“Article 146. Copyright andRelated Right Infringements
1. Anillegal useofassets covered bycopyright orrelated rights, aswellasamisappropriation
ofauthorship, shallbepunishable, ifsuchoffenses caused substantial damage:
- byafineequal to200-400 times theminimum wage ortotheconvict 'swage orother
incomes for2-4months, orcompulsory work for180-240 hours, orimprisonment
forupto2years.
Thesame offenses, ifcommitted repeatedly orbyagroup ofpersons byprior collusion, or
byanorganized group:
- shallbepunishable byafineequal to400-800 times theminimum wage ortothe
convict 'swage orother incomes for4-8months, oranarrest for4-6months, or
imprisonment forupto5years.
Article 147. Invention andPatent Right Infringement
1. Anillegaluseofaninvention,utilitymodel,orindustrialdesign,adisclosurewithouttheconsent
oftheauthor orapplicant ofthesubstance ofaninvention, utility model, orindustrial design
prior totheofficial publication ofdataregarding thesame, amisappropriation ofauthorship,
andcompulsion toaccept oneasaco-author shall bepunishable, ifsuchoffenses caused
substantial damage:
- byafineequal to200-400 times theminimum wage ortotheconvict 'swage orother
incomes for2-4months, orcompulsory work for180-240 hours, orimprisonment
forupto2years.
Thesame offenses, ifcommitted repeatedly orbyagroup ofpersons byprior collusion, or
byanorganized group:
- shall bepunishable byafineequal to400-800 times theminimum wage ortothe
convict 'swage orother incomes for4-8months, oranarrest for4-6months, or
imprisonment forupto5years.
Article 180. Illegal UseofTrademark
1. Anillegal useofanother 'strademark, service mark, appellation oforigin, orsimilar signfor
similar goods, ifsuchoffense wascommitted repeatedly orcaused substantial damage: shallWT/ACC/RUS/17
Page53
bepunishable byafineequal to200-400 times theminimum wage ortotheconvict 'swage
orother incomes for2-4months, orcompulsory work for180-240 hours, orimprisonment
forupto2years.
2. Anillegal useofwarning marks withrespect toatrademark orappellation oforigin not
registered intheRussian Federation, ifsuchoffense wascommitted repeatedly orcaused
substantial damage: shallbepunishable byafineequal to100-200 times theminimum wage
ortotheconvict 'swage orother incomes for1-2months, orcompulsory work for120-180
hours, orimprisonment forupto1year.
Article 183. Illegal Obtaining andDisclosure ofDataConstituting Trade orBanking Secrets
1. Thecollection ofdataconstituting trade orbanking secrets through thetheftofdocuments,
bribery, orthreats, orbyother illegal means forthepurpose ofdisclosing orillegally using
suchdata: shallbepunishable byafineequal to100-200 times theminimum wage ortothe
convict 'swage orother incomes for1-2months, orimprisonment forupto2years.
2. Anillegal disclosure oruseofdataconstituting trade orbanking secrets without theconsent
ofitsowner, ifsuchoffenses werecommitted formercenary orother personal- interest reasons
andcaused substantial damage: shall bepunishable byafineequal to200-500 times the
minimum wage ortotheconvict 'swage orother incomes for2-5months, orimprisonment
forupto3years withorwithout afineequal toupto50times theminimum wage ortothe
convict 'swages orother incomes foruptoonemonth."
Question 139.
Answer 161ofinWT/ACC/RUS/9 stated thatintheRussian Government ’sopinion, theCivil
Code should notcontain provision thatrepeat orrevise federal lawsonIPRprotection, andthat
Parts IandIIoftheRussian Civil Code were approved andPartIIIwasbeing drafted.
HasPartIIIbeenapproved, anddoesanypartoftheCivilCode contain provisions thatcontradict
federal lawsonIPRprotection?
Answer
PartIIIoftheCivil Code stillhastobeapproved. ThefirsttwopartsoftheCivil Code, which
arealready ineffect, donotcontain anyprovisions contradicting special lawsonIPRprotection.
Question 140.
TheRussian delegation hassaidthataplanisbeing developed tostrengthen border measures
toprevent theimport ofgoods thatinfringe intellectual property.
What isthestatus ofthatplan, andwhen willthemeasures, ifany,beimplemented?
Answer
SeeAnswer 136herein.WT/ACC/RUS/17
Page54
Question 141.
With reference toquestion 158inWT/ACC/RUS/9, hasatimeframe been setforestablishing
theHigher Patent Chamber?
Answer
SeeAnswer 112herein.
Question 142.
Onwhat basis could thecontinued application after Russia 'sWTO accession oftheprivileges
granted tothecountries listed intheresponse toquestion 45ofWT/ACC/RUS/13 beconsidered
consistent withArticle 4(d)oftheTRIPs Agreement, e.g.,thatthey"donotconstitute anarbitrary
orunjustifiable discrimination against nationals ofother Members?" Please listanyother instances
ofadvantages, favours, privileges orimmunities nowgranted byRussia orprovided forin
agreements ortreaties, whether ornotineffect, tothenationals ofother countries inthearea
ofintellectual property thatarenotapplied onanm.f.n. basis.
Answer
Therearepresentlythreecategoriesofrightsgrantedtonaturalandjuridicalpersonsofindividual
countries andtoowners ofrights inworks originating inindividual countries other thanonanm.f.n.
basis, namely:
(i) retroactive protection ofcopyright (butnotphonograms). Oneexample istheinternational
agreement withSweden. Forthemost likely future resolution, seeAnswer 114;
(ii) payment offeesinrubles (rather thaninUSdollars). Thisisprovided forininternational
agreements withsome other CIScountries withdueregard forthepossibility ofmaking
transborder settlements inrubles. Themost likely resolution ofthisistopreserve itasan
exception inaccordance withTRIPs Article 4,clause (d);and
(iii) filing ofapplications forinventions, utility models, andindustrial designs notthrough Russian
patent agents. Thisisprovided forininternational agreements among other CIScountries with
dueregard fortheintegrity oftheirmailing systems. Themost likely resolution ofthisis
topreserve itasanexception inaccordance withClause (d)ofTRIPs Article 4.
General (WT/ACC/RUS/9)
Question 143.
Initsanswer toquestion 139Russia refers toitsbilateral intergovernmental agreements with
several CIScountries. Could theRussian Federation explain whether itgrants inthese treaties
anyadvantage, favour, privilege orimmunity which itdoes notaccord tonationals ofother
countries?
Answer
SeeAnswer 142herein.WT/ACC/RUS/17
Page55
Question 144.
Asregards related rights theRussian Federation states thatRussian rightholders andrightholders
from other countries areprotected ifcorresponding bilateral agreements have been concluded
andtherelevant works havebeencreated prior to1973. What doesthismean forworks created
after 1973? Furthermore, Russia mentions "some exceptions". Could theRussian Federation
bemore specific about what ismeant bythis?
Answer
Unfortunately theQuestion isnotclear since 1973 hasnothing todowithrelated rights.
Question 145.
Initsanswer toquestion 153Russia states thatunder some international agreements ithasto
grant some privilege which donotconstitute anexception from m.f.n. treatment under Article 4
oftheTRIPS Agreement. Could Russia clarify thisstatement?
Answer
SeeAnswer 142herein.
Question 146.
(a) Finally, arethere anyother provisions inthelegislation oftheRussian Federation that
donotcomply withArticles 3and4oftheTRIPS Agreement? Ifyes,which arethey?
(b) What isthedirection andschedule fortheamendment ofRussia ’sIPRsystem inrelation
toWTOaccessionoftheRussianFederation?Whatisthejudicialsolutionfortheprotection
ofIPR? Specifically, what arethecompensation measures incaseofviolation ofindustrial
design, invention patent, andutility model?
(c) What arethemeasures torestrict theabuse ofrights inrelation toIPRinRussia?
Specifically, what istheguarantee ofcancellation ofaregistration, etc.?DoesRussia have
thelawcovering these matters andaseparate judicial body todealwithexclusively with
IPR-related disputes?
Answer
(a) TheonlyprovisionwhichappearsnottostrictlycomplywiththeprovisionsofTRIPsAgreement,
Articles 3and4isthatofretroactive protection. SeealsoAnswers 142(1) and114herein.
(b) SeeWT/ACC/RUS/7, pages 24-29.
(c) SeeWT/ACC/RUS/7, pages 22-23. There isnosuchseparate court.
Draft Civil Code
Question 147.
Initsanswer toquestion 61theGovernment oftheRussian Federation refers tothedraft Civil
Code andgives ageneral description ofthelaw.Could theGovernment oftheRussian FederationWT/ACC/RUS/17
Page56
bemore specific about thecontents ofthe"general andspecific provisions" onIPRprotection?
Isitpossible togetacopy ofParts IandIIofthelawwhich hasalready beenadopted? What
arethemain elements ofPartIIIofthedraft Civil codewhich iscurrently under discussion?
What isthetimeframe forthelegislative process?
Answer
SeeAnswer 139herein. ThetextsofPartIandPartIIoftheCivil Code havebeenpreviously
submitted totheWTO Secretariat, andshould beavailable through theAccessions Division.
Protection ofUndisclosed Information (WT/ACC/RUS/9)
Question 148.
Could theRussian Federation describe themain elements ofthedraft Federal lawonCommercial
Secrets andthepossible time-frame forthelegislative process? Does thedraft takeaccount of
Article 39oftheTRIPS Agreement?
Answer
SeeAnswer 127herein.
Question 149.
Initsanswer toquestion 171theRussian Federation refers toa"draft federal billonsecrecy".
Isthisdraft identical withtheabove-mentioned Federal LawonCommercial Secrets orisitto
beseenasaseparate second law? Ifyes,when willthissecond lawbeinforce andwhat differences
arethere between thetwolaws?
Answer
Thisisthesame draftlaw.
Copyright andRelated Rights (WT/ACC/RUS/9)
Question 150.
Initsanswer toquestion 174theRussian Federation recognises thatwhen acceding totheWTO
theRussian Federation should comply withArticles 1through 21oftheBerne Convention (in
particular Article 18)inconjunction with Article 9oftheTRIPS Agreement ("retroactive
protection"). HastheRussian Government taken anyaction tochange itslaws accordingly?
Arethere anyother provisions intheRussian copyright andrelated rights legislation thatneed
tobechanged tocomply withtheTRIPS Agreement inthecontext oftheaccession oftheRussian
Federation? Ifthisisthecase, please outline what changes need tobedone.
Answer
From thetechnical point ofview, retroactive protection could bephased induring thetime
period tobeagreed uponinthecourse ofaccession negotiations either through theadoption ofspecial
legislative provisions orthrough direct application oftherespective provisions intheTRIPs Agreement
withaccount taken, inparticular, oftheRussian Federation Law"OnCopyright andRelated Rights"
(asamended on19July1995), Article 5,clause 1,paragraph 4andArticle 36,clause 4expresslyWT/ACC/RUS/17
Page57
refer inthese matters tointernational agreements. Itappears thatnoother provisions inRussian
legislation oncopyright andrelated rights needtobechanged inorder tocomply withtheTRIPs
Agreement.
Question 151.
Initsanswer toquestion 156theGovernment oftheRussian Federation refers to"minimum
amounts ofroyalties" forsome limited forms ofutilisation ofawork. Does thismean thatthe
parties ofthecontract cannot gobeyond thatminimum? What istheamount ofthese minimum
rates?
Answer
Theamounts ofroyalties forthese usesofawork maynotbesmaller thanthose established
bytheRussianGovernment.ThetextofRussianGovernmentResolutionNo.218,dated21March1994,
isbeing submitted totheWTO Secretariat.
Patents (WT/ACC/RUS/9)
Question 152.
What isthetimeframe fortheestablishment oftheHigher Patent Chamber, which iscurrently
under consideration intheRussian Federation (seeanswer toquestion 158)?
Answer
SeeAnswers 112and121herein.
Question 153.
Initsanswer toquestion 170theRussian Federation states thattheconditions which apply for
compulsory licences assetoutinLawNo.3517-1 "OnPatents" ofSeptember 1992are"generally
consistent withArticle 31oftheTRIPS Agreement". Could theRussian Federation bemore
specific? Isitpossible togetacopy ofLawNo.3517-1?
Answer
Acopy ofthePatent LawoftheRussian Federation (No.3517-1 of23September 1992) hasbeen
submitted totheWTO Secretariat (seeWT/ACC/RUS/2/Add.1, item114). Thecontents ofArticle 10,
clause 4and5;Article 11;andArticle 13,clause 4ofthislawappear tosubstantially coincide with
those ofTRIPs Articles 30and31(with dueregard forTRIPs Article 6),evenifbeing lessdetailed.
Additional detailing maybeprovided either byamending thelaworthrough direct application ofthe
TRIPs Agreement inthisrespect.
Trademarks, Geographical Indications, including Appellations ofOrigin (WT/ACC/RUS/9)
Question 154.
Could theRussian Federation provide acopy oftheRussian LawNo.3520-1 "OnTrademarks,
Service Marks andAppellations ofOrigin" of23September 1992?WT/ACC/RUS/17
Page58
Answer
Thislawwasprovided totheWTO Secretariat inNovember 1995(seealsoWT/ACC/RUS/15).
Enforcement (WT/ACC/RUS/9)
Criminal Procedures
Question 155.
Does Russia dispose ofanyinformation regarding thetimeframe forthelegislative process for
thenewCriminal Code aswellasthechanges totheexisting code(answer toquestion 181)?
Answer
SeeAnswer 138.
Civil andAdministrative Procedures andRemedies
Question 156.
Could theGovernment oftheRussian Federation elaborate more onitsanswer toquestion 177
(does theRussian Federation have provisions initslaws andregulations which comply with
Section 2oftheTRIPS Agreement, inparticular Articles 44,45and46)?
Answer
Pending
Provisional Measures
Question 157.
Why doestheRussian Federation deem thepowers ofthecourts ofitsgeneral jurisdiction an
arbitration courts beinlinewithArticle 50oftheTRIPS Agreement (answer toquestion 186)?
Answer
Pending
Special Requirements Related toBorder Measures
Question 158.
InWT/ACC/RUS/7 (page 28)theRussian Federation states thatitslegislation doesnotprovide
foranyspecial administrative orother procedure tosuspend therelease intofreecirculation of
goods whose importation willinfringe intellectual property rights asstipulated byArticle 51of
theTRIPS Agreement forcounterfeit trademark andpirated copyright goods. Instead, theright
holder hastohaverecourse tothejudicial procedure forprovisional measures. InWT/ACC/RUS/9
theRussian Federation states thatthisisinlinewithArticle 51oftheTRIPS Agreement. Could
theRussian Federation explain onwhatgrounds thisinterpretation isbased andwhether itscurrent
system reflects theelements which arecontained inthesubsequent Articles 52to60oftheTRIPSWT/ACC/RUS/17
Page59
Agreement? Could italsoexplain howconcrete is"theplantoimplement anadministrative
procedure inorder tomake thisarrangements more effective"? What elements doesitcontain
(answers toquestions 143,178,179,180)?
Answer
Pending
FeesandTaxes (WT/ACC/RUS/9)
Question 159.
Intheanswer toquestion 155theRussian Federation describes thecalculation offeesandtaxes.
Patent andregistration feesforcomputer programs, databases andlayout designs ofintegrated
circuits areregularly reviewed. Itseems thatthisreview doesnotinclude other IPRs. Could
theRussian Federation explain why?
Answer
Thenotion "patent fees"covers feesforthepatenting ofinventions, utility models, andindustrial
designs, andfortheregistration oftrademarks, service marks, andappellations oforigin. Astoother
IPRs(with theexception oftheregistration ofcomputer programs, databases, andlayout-designs of
integrated circuits forwhich registration feesarecollected), theydonotinvolve payment ofanyfees
and,hence, nofeereviews arecarried outintheirconnection.
Trade-Related Investment Measures (TRIMs)
WT/ACC/RUS/13
Question 160.
Thereply toquestion 4indocument WT/ACC/RUS/13 provides abrief listofgovernment
incentives, including taxandcustoms benefits, butdoesnotspecify eligibility criteria.
Who would beeligible forthebenefits outlined inquestion 4?What types ofconditions must
investors accept inexchange forbeing eligible forthese investment incentives?
Answer
Pending
Question 161.
(a) Thereply toquestion 39(b) notes thatProduction Sharing Agreement (PSA) operating
companies maybeexempted from VAT, excise taxandcustoms duties andthatexemptions
arenotbased onconditions oflocal content.
Ifnotlocal content, what performance requirements would render aPSA operating
company eligible fortheexemptions outlined inquestion 39?Isitnecessary toobtain
acertain levelofexports, forinstance?WT/ACC/RUS/17
Page60
(b) Most natural resource projects inRussia arejointventures between foreign investors and
Russian counterparts. Investors arefrequently hampered bylongwaiting forapproval
bytheDuma. CanRussia delegate theDuma ’sauthority totheother appropriate agencies
inorder toexpedite theprocess ofapproving natural resource development? (Article 2)
(c) According toArticle 17oftheProduct Sharing Law, when unforseen circumstances take
place after contracting, thecontract canbechanged upon oneparty ’srequest. What in
detail cansuchunforseen circumstances be?
Answer
(a) Theimplementing legislation fortheLawNo.225-FZ “OnProduction Sharing Agreements ”
of30December 1995 (the“Production Sharing Law”)isnotyetfullyinplace. Wewould
liketonote, however, thatcurrently thefinalparagraph ofArticle 7.2states that“Theparties
shall make aprovision intheir [PSA] Agreement thatnolessthanacertain amount of
technological equipment usedforproduction ofmineral resources andtheirprocessing (if
provided forbytheAgreement) andpurchased bytheInvestor subject tosubsequent cost
recovery fromcostproduction shallbeproduced ontheterritory oftheRussian Federation. ”
(b) TheProduction Sharing Lawcurrently doesnotprovide forthepossibility ofdelegating the
Duma ’sauthority toother agencies. Inorder fortheDuma ’sauthority tobedelegated toother
government agencies, amendments totheProduction Sharing Lawallowing suchdelegation
would havetobeintroduced.
Under theProduction Sharing Lawparliamentary approval isrequired forthelistoflandplots
which maybesubject toproduction sharing agreements (thislistiscurrently under discussion
intheState Duma) and,incertain cases specifically, fortheproduction sharing agreements
(ifthePSAisforcontinentalshelf,exclusiveeconomiczone,fieldsofStatestrategicimportance,
orforfields concluded without atender -seeArticle 6.1oftheProduction Sharing Law).
Itshould benoted, however, thatpursuant toArticle 2.5oftheProduction Sharing Law
production sharing agreements “concluded bytheRussian Federation withInvestors prior
totheentryintoforceofthisFederal Lawarebedeemed tobeincompliance withtheprovisions
ofthisFederal Law”,insuchcases, itisgenerally understood thatnoadditional approvals
bytheDuma orother State bodies arerequired forsuchproduction sharing agreements.
(c) Article 17oftheProduction Sharing Lawstates thatamendments toaProduction Sharing
Agreement maybemade onlybymutual consent oftheparties, aswellasbydemand ofone
oftheparties incase ofasignificant change incircumstances inaccordance withthe
Civil Code oftheRussian Federation. According toArticle 451ofPartIoftheRussian Civil
CodeNo.52-FZ of30November 1994achange incircumstances isconsidered tobesignificant
ifthecircumstances “have changed tosuchanextent thatincasetheparties could have
reasonably foreseen thatchange, thecontract would nothavebeenconcluded bythem or
would havebeenconcluded onessentially different terms”.
TheCivil Code provides that,based onasignificant change incircumstances, acontract may
beeither terminated oramended, unless otherwise provided bythecontract orinferred from
itssubstance. Iftheparties havefailed toadapt thecontract tonewcircumstances, thecontract
maybeterminated byacourt oflawiffourconditions aresimultaneously met:
- atthemoment ofentering intoacontract, theparties proceeded fromthefactthatno
suchchange incircumstances would takeplace;WT/ACC/RUS/17
Page61
- thechange incircumstances hasarisen asaresult ofcauses, which theinterested party
could notovercome aftertheyhavearisen, while displaying thedegree ofdiligence,
which isexpected fromthatparty bythenature ofthecontract andbynormal business
practices;
- theexecution ofacontract without amending itsprovisions would soupset thebalance
ofeconomic interests oftheparties, andwould entail suchalossfortheinterested
party thatitwould, toaconsiderable extent, bedeprived ofwhatitcould haveexpected
toreceive when entering intothecontract; and
- itmaynotbeinferred either from business practice, orfrom thesubstance ofthe
contract thattheriskofchange incircumstances isborne bytheinterested party.
Inexceptional cases, acourt oflawmayamend thecontract ifitdecides thatthetermination
ofthecontract would violate public policy orwould entail losses fortheparties considerably inexcess
oftheexpenses necessary fortheexecution ofthecontract, ontheterms stipulated bythecourt.
Question 162.
(a) Initsreply toquestion 40(b), theRussian Federation states that"inprinciple, the
Government oftheRussian Federation doesnotplantoadopt measures which would
contravene theprovisions oftheTRIMs Agreement".
IsRussia willing tostrengthen itscommitment inregard totheTRIMs agreement andcommit
tonotadopting measures thatwould contravene TRIM provisions?
(b) Willthefollowing practices beabolished under theforeigners ’investment law?
- requirements tosellacertain percentage offoreign exchange;
- 10percenttaxpayment incashofremittance ofbusiness profit;
- restrictions onforeign investment inSOC project;
- abolishment oftaxholidays.
(c) What arethemain contents ofthedraft foreigners ’investment lawwhich isbeing examined
intheDuma, andwhen doyouexpect theDuma topassit?
Answer
Pending
Question 163.
Thereply toquestion 41(d) doesnotexplicitly addressed TRIMs atthesub-federal level; itstates
onlythat"itdoesnotcollect dataontheir measures". There isnoindication ofwhat steps may
havebeentaken toensure thatsub-federal authorities areaware ofTRIMs obligations andwould
bewilling tonotify andeliminate allmeasures inconsistent withtheTRIMs Agreement.
What measures hasRussia taken orwillRussia taketoensure thatsub-federal authorities: are
aware oftheTRIMs provisions; arewilling/able toidentify inconsistent measures; andwould
notify andeliminate inconsistent measures? WillRussia beabletoidentify thepublications that
refer tosub-federal TRIMs?WT/ACC/RUS/17
Page62
Answer
Pending
Agriculture
Question 164.
Arethose items listed inAnnex 2(WT/ACC/SPEC/RUS/1) which arenowindicated tobesubject
toexport licences identical totheitems currently under theexport contract registration system
inaccordance withtheGovernment Decision No.758,issued on1July1994?
Answer
Thelistofproducts subject totheexport contract registration system wasquitedifferent than
thatincluded inAnnex 2ofWT/ACC/SPEC/RUS/1.
Theexport contract registration system isnolonger inforce inRussia. Itwasrepealed by
Resolution oftheGovernment oftheRussian Federation No.300“OntheInvalidation ofCertain
ResolutionsoftheGovernmentoftheRussianFederationontheIssueofRegistrationofExportContracts
forCommodities ”of21March 1996.
Question 165.
CantheRussian Government specify whether eachoftheexport andimport non-tariff measures
listed inAnnex 5(WT/ACC/SPEC/RUS/1), except those inAnnex 2which areclearly explained
tobeunder export licensing, iseither anexport orimport non-tariff measure, andwhat type
ofnon-tariff measure eachofthem is?
Answer
Seedocument WT/ACC/SPEC/RUS/1/Rev.1 which nowidentifies which items areexport and
which areimport measures.
With reference to:WT/ACC/SPEC/RUS/1
Question 166.
RussiareportsthatitmaintainsnoGATT-inconsistentnon-tariffmeasuresforagriculturalproducts.
WeencourageRussiatorefrainfromerectinganynon-tariffmeasures,andtoeliminateanyvestiges
ofnon-tariff measures existing from theprevious regime.
Answer
Please clarify thequestion.
Question 167.
Russia reports thatnearly allagricultural products arecovered bypreferential trade agreements.
Does thismean thattheproducts aresubject toageneralized preference system forLDCs, or
isthispartofefforts toestablish customs unions withother CIScountries?WT/ACC/RUS/17
Page63
Answer
Allforeign trade(including thatinagricultural products) under free-trade agreements concluded
byRussia withotherCIScountries ismaintained onaduty-free basis. Asfarastariffpreferences granted
byRussia todeveloping countries, including leastdeveloped nations, areconcerned, nosuchpreferences
areextended tothose agricultural products listed inAnnex 4ofWT/ACC/SPEC/RUS/1.
SeealsoWT/ACC/SPEC/RUS/1.
Question 168.
Russia reports inAnnex 5thatcertain alcohol products aresubject tominimum import price
systems. WenotethattheAgreement onAgriculture prohibits minimum import price schemes
inparagraph 4.2.HowdoesRussia intend tochange thispolicy tomeettheAgreement provisions
upon WTO accession?
Answer
Aspreviouslynoted,minimumpricesinthecasewithstrongalcoholproductsmeannotminimum
import prices, butminimum retailprices which areunrelated tocustoms valuation ortoanidentification
ofthreshold forintroduction ofsafeguard measures. Aminimum retail price includes theamounts
ofcustoms duties, excises, andtaxes which atrader must paybefore retailing hisproduct.
Such minimum retail prices havebeenintroduced inorder toprevent smuggled orillegally
distilled products from getting ontothemarket. Minimum retail prices apply tobothdomestic and
imported strong alcohol products.
Question 169.
Wewere encouraged when Russia reported inWT/ACC/RUS/10 thatitdidnotsubject any
agricultural products toimport licensing requirements. However, Russia reports in
WT/ACC/SPEC/RUS/1 thatunder Annex 5anumber ofagricultural products aresubject to
non-automatic licensing.
These measures cover products such asedible treenuts(including cooked), mushrooms, and
miscellaneous edible preparations. Could Russia explain whythese items arenotcovered by
automatic licensing, andwhat thecriteria areforreceiving alicense? Could Russia explain why
these licensing requirements arenotincluded intheinformation onimport licensing contained
inWT/ACC/RUS/10?
Answer
Document WT/ACC/SPEC/RUS/1 isacomprehensive review ofbothimport andexport related
measures. Items suchasedible treenutsandmushrooms arenotsubject toimport licensing requirements
butrather export licensing requirements. Members oftheWorking Party should beguided by
WT/ACC/SPEC/RUS/1/Corr.1 which isarevised version ofAnnex 5ofthedocument which now
clearly identifies which measures areimport-related andwhich measures areexport-related.
SeealsoAnswer 164herein.WT/ACC/RUS/17
Page64
Injury toDomestic Industry Producing Alcohol andAlcoholic Products
Question 170.
Regarding the“Investigation intotheFacts ofSerious Injury Suffered byDomestic Industry
Producing Alcohol andAlcoholic Products ”(WT/ACC/SPEC/RUS/1, Annex 1A):
Russia hasstated inWT/ACC/SPEC/RUS/2 thatits"Procedure forConducting Investigations
Preceding Adoption ofSafeguards" isconsistent withtheWTO Agreement.
Arethese procedures available forWorking Party review? DidtheRussian Federation notify
allinterested parties, including exporters, conduct apublic hearing, andsolicit theviews ofall
interested parties before taking afinal determination?
Answer
The“Procedures forConducting anInvestigation Prior totheIntroduction ofSafeguard
Measures ”wassubmitted bytheRussian delegation totheWTO Secretariat inNovember 1995.
TheRussian Federation notified allinterested parties ofthecommencement oftheinvestigation
concerned, andtooktheiropinions intoaccount when making thefinaldetermination.
Finaldetermination,accordingtoResolutionNo.1590“OnStreamliningImportToTheCustoms
Territory OfTheRussian Federation OfEthyl Alcohol AndVodka ”dated 30December 1996, the
pre-plannedsafeguardmeasureswerereplacedbyonlyimportnon-automaticlicensingprocedureswithout
quantitative restriction inthefieldofethylalcohol andvodka only. Additionally, thepriorResolution
No.1125“OnIntroduction OfProtective Measures Concerning TheImport IntoTheCustoms Territory
OfTheRussian Federation OfEthanol OfEdible RawMaterial AndVodka ”dated 19September 1996
wasabolished.
Question 171.
Thereport“InvestigationintotheFactsofSeriousInjurySufferedbyDomesticIndustryProducing
Alcohol andAlcoholic Products ”considers twoproducts, vodka andethyl alcohol.
Does theRussian Federation viewbothproducts asoneandthusmake onedetermination?
Initssafeguard investigation, howdidtheRussian Federation determine thattheRussian vodka
industry hasexperienced injury, even though vodka production, total capacity andcapacity
utilization increased during theperiod ofthestudy?
Regarding itssafeguard investigation forvodka andethyl alcohol, hastheRussian Federation
determined thatthere were no“factors other than increased imports ...causing injury tothe
domestic industry atthesame time”?
What aretheproposed levels ofquotas forvodka andethyl alcohol? Arethequotas consistent
withtheWTO Safeguard Agreement provision thatsafeguard measures shall beapplied “only
totheextent necessary toprevent orremedy serious injury andtofacilitate adjustment."
What istheimplication ofthe“review investigation ...inthemiddle ofthetwo-year period during
which thequotas willbeinplace”?Does thismean thequotas willbeinplace foroneyearor
two?WT/ACC/RUS/17
Page65
Answer
Ethyl alcohol obtained from edible rawmaterials, andvodka were treated astwodifferent
products during theinvestigation inquestion.
Theextent ofinjury wasassessed onthebasisofdataregarding serious injury (such asdeclines
incapacity utilization, downtime, decreases inthemarket share) suffered byRussia 'sofficially operating
distillers having appropriate governmental licenses. Forexample, because theyoperated below capacity,
theshortfall oftaxes from legalRussian distillers in1996, came tosome US$5 billion.
Itwasestablished inthecourse oftheinvestigation thatother factors werenotcausing serious
injury tothedomestic industry.
Theproposed levels ofquotas wereprecisely suchastoprevent serious injury tothedomestic
industry andtofacilitate itsadjustment tocompetitive conditions onworld markets.
Theimport quotas were proposed foraperiod ofoneyear.
SeealsoAnswer 170herein.
Question 172.
Itisnotpossible todetermine, from thereport inWT/ACC/SPEC/RUS/1, whether keyprocedural
protection andother provisions oftheWTO Safeguard Agreement were observed inthisaction.
Answer
SeeAnswer 170herein.
Question 173.
Indocument WT/ACC/SPEC/RUS/1 there arenon-automatic license ontrade incertain livefish
products. Does thismeasure concern (a)import licences only, (b)export licences onlyor(c)both
import andexport licences?
Answer
Thenon-automatic license measures referring tocertain livefishproducts indocument
WT/ACC/SPEC/RUS/1 refertoexport measures only.
SeeAnswer 165herein.
Question 174.
Re.WT/ACC/SPEC/RUS/3. Inthefirstparagraph (lines 4-5), thisdocument expresses that"a
neweconomic system isbeing forged, including asystem ofsupport foragricultural producers".
Could wehavemore information onthegoals andmodalities ofthissystem envisaged? Inwhich
waywillthenewsystem affect market access, domestic support, export subsidies andexport
financing?WT/ACC/RUS/17
Page66
Answer
Pending
Question 175.
Inparagraph 2,second page ofWT/ACC/SPEC/RUS/3 reference ismade toan"agricultural
credit system stillnotinplace". AretheRussian authorities planning toestablish anagricultural
credit system? Ifso,could wegetsome information onitsrelevant modalities andclarify ifthat
system would make itpossible toprovide subsidized credit?
Answer
Pending
Question 176.
Inthethird paragraph, the"principle ofcomparability" isintroduced todetermine "the
representative levelofsupport" aswellas"thelossorgainwithrespect toagriculture indifferent
countries".
Since theabove isanewconcept within theWTO, could theRussian Federation authorities indicate
themeaning ofthatapproach? Itmust berecalled hattheconcept oftariffication wasapplied
withacomplete different approach anditwasaformula approved horizontally onlyforUruguay
Round Participants thatbecame WTO Original Members.
Answer
Pending
Question 177.
Thelawparagraph ofthesecond page (same document) includes theconcept of"restoring
government support programmes foragriculture tothose levels which would besufficient toensure
itssteady development inacompetitive market environment".
Thisconcept seems todisregard thatpresent WTO Members didnotarbitrarily establish their
levels ofdomestic support commitments during theUruguay Round, since theyhadtobasethose
commitments onthelevels registered in1986-88. Theceiling ofthose commitments weretherefore
notestablished byasubjective political decision orpolitical preference.
Atpresent, there isageneral understanding thattheRussian accession should bebased inthe
methodology included intheWT/ACC/4 document.
Answer
PendingWT/ACC/RUS/17
Page67
Question 178.
Onpage 3,paragraph 2ofthesame document, itissaidthattheRussian Federation "inprinciple
agrees withselective support foragricultural product exports". Then itgoesonproviding some
examples.
Export subsidies commitment ofWTO Original Members arebased inactual figures related to
the1986-90 base period. Similarly tothecaseofDomestic Support, itisintended thatnew
Members initiate negotiations departing, atleast, from figures based onvolume andbudgetary
outlays related tothebaseperiod mentioned intheWT/ACC/4 WTO document.
Answer
Pending
Non-Paper onAgriculture
Explanatory Notes
Question 179.
WenotethatRussia usesadjustment factors tobring itscurrency calculations into1995 prices.
While theinformation isinteresting, andmakes thedatamore relevant forcurrent comparisons,
itwould bemore helpful tofollow therequirements ofWT/ACC/4 exactly andreport information
onexpenditures innominal terms foreachoftheyears listed.
Answer
Pending
Question 180.
Weseeintheexplanatory notethatRussian State Statistics Committee deflator indices wereused
totranslate nominal prices intoadjusted 1995prices. Itisunclear toushowtheindices toconvert
1989-91 expenditures into1995 prices were constructed.
How were these indices calculated, what kindofindex wasused(CPI, PPI,GDP), andwhat is
thebasis forcomparison (average. fortheyear, December toDecember)?
Towhat extent dothese datainclude expenditures attheregional level? Since 1993, alotof
subsidies/agriculture policies havebeentransferred totheregional level. Abreakout ofthedata
(federal andregional), todemonstrate total inclusion ofallsupport, would greatly enhance
transparency. Itmaybethatcertain agriculture research andtraining andcapital investment
policies aregreen box,butwithout more detail wecannot tell.
Answer
PendingWT/ACC/RUS/17
Page68
Comments onspecific 1993-95 tables
DS:1 --Wewould appreciate clarification onthefollowing programmes:
Question 181.
(page 1)Under capital investment, what arenon-production facilities? Arethese facilities ports
orroads, orsome other kindofinfrastructure? Also, what ismeant bycapital investment by
research institutes, etc.?
Answer
Pending
Question 182.
(page 2)Could Russia explain indetail what iscovered under “operating expenses ”listed intable
DS:1 andagain inDS:9? Thename given inbothtables isthesame, butthelevelofexpenditures
differ. Note: tobeexempted from theAMS, theexpenditures mustcover provision orconstruction
ofcapital works only--isthiswhat isincluded inDS:1? Subsidized provision ofon-farm facilities,
subsidies toinputs oroperating costs, orpreferential usercharges belongs intheAMS. Isthis
what iscovered inDS:9?
Answer
Pending
Question 183.
(page 2)Wewould alsoappreciate clarification ofassistance towomen inthecountryside (cash
disbursements torural dwellers). What arethecriteria forreceiving these payments andhow
doesthisprogramme fitunder general services?
Answer
Pending
Question 184.
(page 2)Under public stockholding forfoodsecurity purposes, weneedmore detail ontheoperation
ofRussia ’sfederal andregional foodstock programmes. Could Russia describe these programmes
using thecriteria found inparagraph 3ofAnnex 2oftheUruguay Round Agreement on
Agriculture.
Answer
Pending
Question 185.
(page 2)Under decoupled income support: upkeep ofsocial infrastructure facilities, wewould
appreciate clarification ofhowthisprogramme meets therequirement ofpoint a)inparagraph 6WT/ACC/RUS/17
Page69
ofAnnex 2(“eligibility ofsuch payments shall bedetermined byclearly defined criteria such
asincome, status asaproducer orlandowner, factor useorproduction level inadefined and
fixed baseperiod ”).
Answer
Pending
Question 186.
(page 3)Under income insurance andincome safety-net programmes, wewould appreciate
clarification oftheinsurance premium compensation.
Answer
Pending
Question 187.
(page 3)Compensation forexpenses ofcontingency seedstock fund: howdoes thismeet the
requirements ofparagraph 7ofAnnex 2?InDS:9, there isalsotheinclusion offunds toestablish
seasonal seedstocks. How arethese different?
Answer
Pending
Question 188.
(page 4)Under regional assistance programmes, wewould appreciate clarification ofcapital
investment intheFarNorth, andsubsidies andallowances paidintheFarNorth. What arethe
programme requirements/criteria, andhowdotheyconform tothose listed inparagraph 13of
Annex 2?Arethese programmes unique toagricultural producers, ordoestheprogramme also
extend tosmall towns andcities intheregion?
Answer
Pending
DS:4
Question 189.
Intheexplanatory notes, itstates thatsupporting table DS:4 wascompiled ofproduct-specific
andnonproduct-specific AMSs thatwere above the5percentdeminimis .Itwould beuseful
tohavetheproduct andtotalagriculture values todemonstrate correct application ofdeminimis .
Forthenon-product-specific AMS, themore relevant comparison should bemade between the
aggregate non-product-specific AMS andthevalue oftotalagricultural production, asopposed
tocomparing eachnon-product-specific measure ofsupport withthevalue ofagriculture output,
todetermine deminimis levels.WT/ACC/RUS/17
Page70
Answer
Pending
Question 190.
Please provide thevalue oftotal agricultural production andthevalue ofproduction foreach
commodity covered for1993-95 innominal (not1995) prices.
Answer
Pending
Question 191.
Why didRussia include policies, suchasenergy, equipment, andirrigation subsidies, intable
DS-4? Arethese programmes provided separately toeachcommodity, oraretheymade available
toallfarmers?
Answer
Pending
DS:5
Question 192.
These tables areconfusing. Theexplanatory notes state thatpurchasing prices were “based on
market principles rather thanapplicable regulated prices ”.Could Russia explain indetail how
itdetermined these prices? ACC/4 (page 2-3)andtheAgreement onAgriculture (Annex 3)both
state thatadministered prices have tobeusedtocalculate theprice gap.
Answer
Pending
Question 193.
Regarding external reference prices, itisunclear from thetables howthese prices wereestablished.
Could Russia report what prices were usedforthese calculations?
Answer
Pending
Question 194.
IntheDS:5 tables, thesource given fortheexternal reference price for1993-95 iscustoms data
(for1994-95) andGoskomstat data(for1993). These datasources allgivetrade values indollar
terms. Itisunclear howexternal reference prices for1989-91 werederived from thisdata. Please
provide these calculations. Why were trade datafrom 1989-91 notusedtocalculate the1989-91
price gap?WT/ACC/RUS/17
Page71
Answer
Pending
DS:6
Question 195.
What isthedifferentiated price mark-up cited inDS:6 for1989-91?
Answer
Pending
DS:7
Question 196.
Wenotethatthesame dataappear inDS:4, listed asbeing in1995prices, butarereported under
thetotal product-specific AMS calculated inthistable in1991 prices. Isthisatypographical
error?
Answer
Pending
DS:9 -1993-95 version
Question 197.
(page 3)WenotethatRussia hasincluded purchase ofhybrid cornseedinthenon-product-specific
AMS. Why didn'tRussia include cornhybrid seedsubsidies intheproduct-specific AMS for
corn?
Answer
Pending
Question 198.
(page 4)Wenotethatgovernment support forpedigree livestock breeding isincluded inthe
non-product-specific AMS. Why didn'tRussia include thisintheproduct-specific AMS?
Answer
Pending
Question 199.
(page 4)Wenotethatsubsidies forbread grains wereincluded inthenon-product- specific AMS.
Why didn'tRussia include thisintheproduct-specific AMS?WT/ACC/RUS/17
Page72
Answer
Pending
Question 200.
(page 5)Wewould appreciate clarification ofhowtaxbenefits were estimated, what kindoftax
benefits these are,andwhat thecriteria areforreceiving taxbenefits.
Answer
Pending
Question 201.
(page 5)Wewould appreciate clarification ofthe“other expenses ”category andthetypes of
non-exempt regional support included inthisamount.
Answer
Pending
1989-91 version
Question 202.
(page 1)Wewould appreciate clarification ofhowtaxbenefits were estimated, what kindoftax
benefits these are,andwhat thecriteria areforreceiving taxbenefits.
Answer
Pending
Question 203.
(page 1)Wewould appreciate clarification concerning theloanprogramme, howdebtwrite- offs
were estimated, andthecriteria forwriting offthedebts.
Answer
Pending
Question 204.
(page 2)Wewould appreciate clarification ofhowtheelectric power allowance isdistributed and
thecriteria forreceiving thebenefit.
Answer
PendingWT/ACC/RUS/17
Page73
Question 205.
Could Russia report iflivestock prices intable DS:5 areforliveanimals orforcarcass weight?
Answer
Pending
Question 206.
Please explain what specific product wasusedindetermining theexternal reference price forfluid
milk? Forexample, cheese orsome other dairy product.
Answer
Pending
Question 207.
(DS-1) What aretheassumptions onwhich costestimates forindividual "green-box" measures
were based?
Answer
Pending
Question 208.
(DS-7) Could theRussian delegation elaborate onhowwere themark-ups onpurchasing prices
calculated? Please provide ashort characteristic oftheconcept of"mark-up" asusedinexplanatory
notes tospreadsheet 7.
Answer
Pending
Question 209.
(DS-9) Arethefigures regarding interest rates foragricultural producers (10percent) andthe
estimated rateforcommercial loans in1995(180percent) nominal figures, ifso,isthisasubsidy
oncredit interest rates amounting to170percent?
Answer
Pending
Question 210.
(DS-9) Istheterm "electric power concessions" asusedonpage 4equivalent totheterm"electric
power allowances" asusedintable DS-9 onpage 22?WT/ACC/RUS/17
Page74
Answer
Pending
Question 211.
Pleaseelaborateonsafeguardmeasuresintendedtobeintroducedwithregardstoimportedalcoholic
beverages andsugar.
Answer
Pending
Guaranteed Minimum Prices
Question 212.
TheRussian Federation states thatitwillextend thesystem ofguaranteed minimum prices for
agricultural products andfoodstuffs forState needs, "asaform ofsupport fortheagricultural
producer during theperiod ofadaptation oftheagrarian sector tothemarket economy".
Please clarify whoiseligible forthissupport measure.
How doestheselection process takeplace?
How arethelevels oftheminimum prices established?
Answer
Pending
Question 213.
Please provide themost recent statistics onagricultural imports andexports, broken down by
(a)product group, (b)country oforigin and(c)country ofdestination.
Answer
Pending
WT/ACC/RUS/13/Add.1
Question 214.
Inthereplytoquestion166inthisdocument,theRussianFederationmentionsthatsomesafeguards
investigations have been opened andcarried outinRussian Federation, andthattherelevant
information andconclusions have been transmitted totheWTO Secretariat.
Istheinformation referred toonlythatwhich appears indocuments WT/ACC/SPEC/RUS/1 and
WT/ACC/SPEC/RUS/2 orhasother information alsobeen transmitted totheWTO?WT/ACC/RUS/17
Page75
Ifother information hasbeentransmitted totheWTO, please indicate inwhich WT/ACC/RUS
series document (andwhere inthatdocument) thisinformation canbefound.
What arethelawsandregulations which constitute thelegalbasis forcarrying outsuchsafeguards
investigations?
Please provide theWorking Party withacopy ofthenewlegislation on"Measures toprotect
economic interests oftheRussian Federation inforeign trade" which waspassed bytheDuma
on19July.
Answer
TheRussian Federation hasnottransmitted anyother information totheWTO Secretariat in
addition tothatreferred tointhequestion.
ThelegalbasisforopeningsafeguardinvestigationsandapplyingsafeguardsinRussiaisfurnished
bytheFederal Law No.157-FZ "On theState Regulation ofForeign Trade Activities" of
13October 1995 (Article 18),theRussian Federation LawNo.5003-1 "OntheCustoms Tariff" of
21May1993 asamended (Article 8-11) and“TheProcedure forConducting AnInvestigation Prior
totheIntroduction ofSafeguard Measures ”approved bytheDecree No.1000oftheMinistry ofForeign
Economic Relations of21December 1995. Allthesedocuments wereprovided totheWTO Secretariat
in1994and1995. AstothedraftoftheLaw"OnMeasures toProtect Economic Interests oftheRussian
Federation InForeign Trade inGoods", seeAnswer 1herein.
Question 215.
Re.Spreadsheet DS-4. Thesocalled "deminimis clause" does notoperate asanautomatic
deduction asitseems tobethecaseinthetables prepared bytheRussian Government.
Thecriteria forexcluding the"deminimis levels" from thecalculation oftheCurrent Total AMS
isclearly stated inarticle 6:4oftheWTO Agreement onAgriculture:
(a) forproduct specific domestic support, the"deminimis" provision applies tosituations
where suchsupport doesnotexceed 5percentofthetotalvalue ofproduction ofabasic
agricultural product during therelevant year; itistherefore notapplicable when thelevel
exceeds thatfigure;
(b) inthecaseofnon-product specific domestic support, the"deminimis" provision is
applicable incases where such support does notexceed 5percentofthevalue ofthe
country 'stotalagricultural production. Thus itisnotrelated tothepossibility ofsumming
uptheexpenses exceeding 5percentofthepurchases oftherespective product. Ifthe
expenses exceed the"deminimis" percentage, thentheyhave tobeconsidered intheir
entirety, notjusttheremaining partabove thatpercentage.
Answer
Pending
Question 216.
Re.Spreadsheet DS-4. Inthefirstparagraph ofpage 3,wereadthat"expenses foreachindividual
measure were compared withthevolume ofagricultural production, andamounts equal toorWT/ACC/RUS/17
Page76
smaller than5percentwerenotincluded inthecalculation ofthecurrent totalAMS". However,
Article 6:4oftheWTO Agreement onAgriculture speaks of"value ofproduction", notvolume
ofproduction. Could youplease clarify thebasis ofthisapproach?
Answer
Pending
Question 217.
Re.Spreadsheet DS-5. Ifapplied administered prices werecompiled using "prices generally based
upon market principles rather thanapplicable regulated prices", could youexplain thedifference
between the"applied administered price" andthe"external reference price" onpages 10and11?
With regards totheuseofreference world prices, could youexplain thereasons fornotusing,
forinstance, representative international market quotations?
Answer
Pending
Question 218.
Re.Spreadsheet DS-7. Table DS-7 "contains thetotal product-specific AMS calculated asthe
sumtotalofmarket price supports (DS-5) andnon-deductible direct subsidies (DS-6)". However,
inparagraph 16ofthedocument WT/ACC/4, itisclearly stated that"theresults ofthecalculations
inSupporting Tables DS-5 andDS-6 should, along withthebudgetary cost(orrevenue forgone)
ofother measures, beentered inSupporting Table DS-7 which allows allproduct-specific AMS
tobetotalled". So,didyouconsider "thebudgetary cost(orrevenue forgone) ofother measures"?
Ifnot,could your explain whyanother approach wasapplied?
Answer
Pending
Question 219.
Re.Spreadsheet DS-7. Could youclarify theword "kindergartens" inthiscontext?
Answer
Pending
Question 220.
Areallprogrammes, including sub-national ones, operated byanylevelofsub-national authority,
which meet thedefinitions andcriteria oftheAgreement onAgriculture fordomestic support
included inthese tables? Foranyagricultural programmes thathave notbeenincluded, please
provide aprogramme description, andexpenditures fortheperiod 1993-95, sothattheirexclusion
from these tables canbeconfirmed. Forexample, some oftheprogrammes which wewould have
expected tobeincluded inthese tables butwhich donotappear tohave been arethefollowing
(from reply toQuestion 57ofWT/ACC/RUS/2):WT/ACC/RUS/17
Page77
- support fortheestablishment ofprivate farms (persons moving from cities toagriculture
villages);
- regional support toprovide financing oflivestock producers andanimal feed;
- subsidies toproducers oflivestock delivered tofederal andregional foodstocks; and
- compensation (10-30 percent) forformula feedusedforbreeding high-quality livestock
andpoultry.
Forallofthenotified programmes, arethese infactprogrammes thatwere active during the
period notified andnotprogrammes forwhich expenditures hadbeenauthorized butnotmade?
Answer
Pending
Supporting Table DS:1: Green Box
Question 221.
Wewould liketohaveclarification regarding themeasure "Capital investment". InSupporting
Table DS:1, Russia reports that8.4trillion roubles (in1995 prices) were spent in1994 forthe
construction ofirrigation, drainage, etc.However, inAnswer 57ofWT/ACC/RUS/2, itisreported
that"capital investment intheagricultural sector accounted for2.4trillion roubles in1994".
Thedifference between thetwofigures cannot beexplained bythedeflator used byRussia in
itsSupporting Table DS:1. Please provide more detailed information toclarify thisapparent
contradiction.
Answer
Pending
Question 222.
Foreach ofthemeasures listed aspublic stockholding forfood security purposes, anddirect
payments toproducers classified asdecoupled income support, income insurance andincome safety
netprogrammes, payments forrelief from natural disasters, environmental programmes and
regional assistance programmes, please provide more complete programme descriptions including
anexplanation inrelation tothegeneral criteria ofparagraph 1andtheprogramme specific criteria
(paras 3-13)inAnnex 2fortheparticular measure type.
Answer
Pending
Question 223.
Please present dataincurrent yearvalues, notinflation adjusted values.
Answer
PendingWT/ACC/RUS/17
Page78
Supporting Table DS:4: Total AMS
Question 224.
Non-product specific measures arearepetition ofthose reported inSupporting Table DS:9. These
individual measures should notbereported inthistablewhich aggregates product specific support.
Answer
Pending
Question 225.
TheOECD, initsreport entitled "1996 Agricultural Policies, Markets andTrade inTransition
Economies", states onpage126,thattotalagricultural expenditures under theRussian Federation 's
1995federal budget, i.e.expenditures to(i)agricultural production, (ii)landresources, (iii)other
measures inagricultural sector, and(iv)formation offederal foodstocks amounted to10.4trillion
rubles. CanRussia explain thediscrepancy between these figures andtheamount fortotalAMS
of56trillion rubles noted intable DS:4?
Answer
Pending
Supporting Table DS:5: Market Price Support
Question 226.
Could theRussian Federation indicate whether eligible production reported inthistable intonnes,
orinthousands oftonnes?
Answer
Pending
Question 227.
Isitpossible toexplain thediscrepancy between the"eligible" production datanoted inSupporting
Table DS:5 andtotal amount ofproduction asreported onpages 199and204oftheOECD
document referred toabove? Forexample, wheat production in1995 inRussia wasestimated
bytheOECDdocumentat30.1milliontonnes;however,eligibleproductionwaseither6.3thousand
or6.3million tonnes.
Answer
Pending
Question 228.
Would itbepossible tooutline howeligible production isdetermined? What ismeant by"grain
purchases"? Who doesthepurchasing, andforwhat use?WT/ACC/RUS/17
Page79
Answer
Pending
Question 229.
Please identify thesources andspecification oftheexternal reference prices usedinthemarket
price support calculation (e.g., quality ofproduct, atwhat location, c.i.f.orf.o.b. basis, currency
andsource ofprice data).
Answer
Pending
Question 230.
Foreach product forwhich anapplied administered price isindicated, please describe the
administered price regime forthatproduct, including what thisprice represents, what production
receives thatprice, andhowtheprice isdetermined andbywhom.
Answer
Pending
Supporting Table DS:6: Non-Exempt Direct Payments
Question 231.
Formany commodities, thesupport isdescribed aspartial compensation forthecostofmineral
fertilizers andpesticides. Arethese generally available input subsidies available toallcrops or
arethese administered onacrop-specific basis? Ifso,isthere areason whyhavetheynotbeen
reported asnon-product-specific support inSupporting Table DS:9?
Answer
Pending
Question 232.
Formany products, mostly livestock products (e.g., forsoybeans, cattle, hogs, sheep andgoats,
poultry, milk, eggs, andwool), support islisted simply aspayments. Please describe these
payments. Who iseligible toreceive them? Onwhat basis arepayments toindividual producers
calculated?
Answer
PendingWT/ACC/RUS/17
Page80
Supporting Table DS:9: Non-Product Specific AMS
Question 233.
Wedonothave enough information ontheoperation ofmany measures reported inthistable,
suchas"debts write-offs" or"other expenses, including unidentified regional budgetary expenses"
or"taxconcessions" or"commodity credits". Please describe eachofthese measures more fully.
What aretheunidentified regional budgetary expenses? Please explain howthevalue oftaxbenefits
iscalculated andwhoreceives these benefits. How hasthevalue ofcommodity credits been
estimated? How dothese credit programmes operate?
Answer
Pending
Other Questions
Question 234.
WerequestthatRussiaaddressthequestionscontainedinquestion159ofWT/ACC/RUS/13/Add.1.
While weappreciate Russia 'sintent tosupport, after accession, theimplementation ofonlythose
measures undertaken byregional authorities toencourage exports which areconsistent withWTO
provisions, theinformation requested onsub-central measures intheareaoftaxes andinvestment
isrelevant toanumber ofissues inRussia 'saccession, including market access andexport
competitiveness. Werestate question 159withtherequest thatRussia make itsbestefforts to
supply information ontheissues raised.
Answer
Pending
Question 235.
Initsresponse toquestion 94(WT/ACC/RUS/9), Russia states thatregional executive bodies are
authorized to,buthave notyetapplied measures that, encourage regional export bygranting
taxprivileges tolocal operators intheform ofpartial orcomplete taxholidays withrespect to
regional orlocal taxes orwithrespect totheshare ofthefederal profit taxwhich istobepaid
tothelocal budget.
(a) InWT/ACC/RUS/5, Russia stated thatArticle 71oftheConstitution gives thecentral
government authority toregulate foreign investment regulations, andthatnoregional
lawcould belawfully implemented contrary tothelawsoftheRussian Federation inthis
area. Doesthatmean thatRussia willensure thatregional measures toencourage exports
thatareinconflict withWTO provisions?
(b) Weneedinformation ontheimplementation ofthese regional measures. When doesRussia
anticipate thatthese measures willbeimplemented bytheregional executive bodies? Do
anyofthese regional proposals include export requirements toqualify forthebenefits?
(c) Arethese measures available toforeign-owned entities aswellastodomestic private and
public enterprises?WT/ACC/RUS/17
Page81
(d) Please discuss these measures inthecontext oftheWTO Agreement onSubsidy and
Countervailing Measures (SCM) andArticle XXIV:12 oftheGATT 1994.
Answer
(a) Yes, theRussian Federation willensure thatregional measures toencourage exports are
consistent withitsWTO obligations.
(b) Thisinformation willbemade available bytheRussian Government afterthese measures will
havebeenimplemented.
(c) Itisthebelief oftheRussian delegation thattheywillbe.
(d) Seeparagraph (a)ofthisAnswer.
Additional Questions onGoods Related Issues
Section 3.1.1 Customs Import Tariffs
Question 236.
(a) Please provide aschedule oftheweighted average import tariff forthetime period
1992-1996, either byyearorbysome other subdivision oftimethatlends itself toaprecise
determination, bearing inmind thattariff rates often were changed mid-year. Please
desegregate thenumbers intocategories suchasforagricultural goods, textiles, machinery
andequipment, etc.
(b) Predictability ontariff schedules incrucial foranefficient trade. CanRussia insert the
clause foramechanism suchasprior notification fortariff changes intheCustoms Code
oftheRussian Federation?
Answer
(a) Pending
(b) Inorder tomaintain foreign tradetransactions efficiently, itisplanned toinclude thefollowing
prior notification procedure fornewtariff schedules intheCustoms Code oftheRussian
Federation, whose draftiscurrently being agreed upon byagencies concerned:
- newcustoms duties takeeffect 30daysafterbeing signed intolawiftheyarelower
orthesame astheprevious dutyrates; and
- newcustoms duties takeeffect 90daysafterbeing signed intolawiftheyarehigher
thantheprevious dutyrates.
SeeAnswer 3herein.WT/ACC/RUS/17
Page82
Section 3.1.12 Anti-dumping Duties, Countervailing Duties andSafeguards
Question 237.
Wehave noted intheRussian documentation provided totheWorking Party references toa
Commission forProtective Measures inForeign Trade andtoaCommission forSafeguards in
Foreign Trade.
Arethese commissions thesame? Ifyes,willthiscommission alsoberesponsible forexamining
anti-dumping andcountervailing dutycases inthefuture?
Please describe Russia 'splans todevelop thenecessary legal andregulatory basetoengage in
anti-dumping andcountervailing duty investigations, including designation ofaleadMinistry
toconduct theinvestigations andthecreation ofateam ofinvestigators?
Please supply theregulations andprocedures used ininvestigations oftrade cases involving
safeguards, anti-dumping, orcountervailing measures.
Answer
Yes,thisisthesame commission. Itsprecise name istheCommission oftheGovernment of
theRussian Federation forProtective Measures inForeign Trade. Itisexactly thiscommission that
willinthefuture bealsoresponsible forconducting investigations related todumping andsubsidies.
Thenecessary legalandregulatory baseisprovided bytheFederal LawNo.157-FZ "Onthe
StateRegulation ofForeign Trade Activities" of13October 1995(Article 18),theRussian Federation
LawNo.5003-1 "OntheCustoms Tariff" of21May1993 asamended (Article 8-11) and“The
Procedure forConducting AnInvestigation Prior totheIntroduction ofSafeguard Measures ”approved
bytheDecree No.1000 oftheMinistry ofForeign Economic Relations of21December 1995. Itis
planned inthefuture toadopt additional legislation toinstitutionalize rules andprocedures forthe
application ofsafeguards andanti-dumping andcountervailing measures. (SeealsoAnswer 1herein)
Currently, theRussian Ministry ofForeign Economic Relations (“MFER ”)isresponsible for
theconduct ofrelated investigations.
Therulesandprocedures followed during suchinvestigations aresetforthinthe“Procedure
forConducting AnInvestigation PriortotheIntroduction ofSafeguard Measures ”adocument submitted
totheWTO Secretariat inNovember 1995.
Investment Policy (WT/ACC/RUS/13)
Question 238.
Theresponse toquestion 4refers to"government involvement inprivate capital financing,"
"government orders tobuild specific facilities andmanufacture specific products," andinvestment
"incentives toencourage keyprojects andinvestment inpriority areas". Inaddition, theresponse
toquestion 44refers toincentives that"depend onthesector ofinvestment."
Could Russia provide specific information onthese proposals, citing legislation andother points
ofreference, ontheincentives.WT/ACC/RUS/17
Page83
Arethese programmes linked toanyparticular circumstance, e.g.,aretheyaimed atattracting
investment toexisting facilities orsectors already producing, atencouraging investment innew
sectors, oronanyother factor?
Answer
Pending
Question 239.
Theresponse toquestion 7refers toamechanism ofState guarantees withtheaimofattracting
foreign investments forexpansion ofRussian export-oriented production.
Please givespecifics onthisprogramme, e.g.,howfirms qualify, howlongtheguarantees last,
what measures firms must taketoremain eligible, andacitation ofthelegislation orregulation
thatauthorizes it.
Answer
Pending
Question 240.
Concerning thereferences to"Industrial Policy Guidance for1995-1997" and"Resolution No.324
of22March 1996" inquestion 40anditsresponse:
(a) Please clarify definitively thestatus ofthese proposals andtheavailability ofthedocuments
thatcontain them.
(b) If,asweunderstand, the"Industrial Policy" document wasnever finalized, please describe
theultimate disposition oftheproposal, andhowtheissues outlined inthe"Guidance"
document have been addressed insubsequent alternative initiatives.
(c) There areseveral categories oftaxinRussia such asfederal tax,local tax,local self-
management tax,etc.,andthetaxrates often change. Theprocedure oftaxpayment is
alsoquite complicated. CantheRussian Government amend thetaxsystem inawaythat
willpromote foreign investment?
Answer
Pending
Statistics andPublications Systems
Question 241.
TheRussian Federation described itssystem offoreign trade statistics initsMemorandum on
theForeign Trade Regime (L/7410). However, since thatdocument wasprepared, Russia has
switched overtoasystem based oncustoms cargo declarations.
Please describe thiscurrent system, including:WT/ACC/RUS/17
Page84
(a) thestatistical publications covering foreign trade;
(b) customary target dates forrelease ofpreliminary monthly, quarterly, andannual data;
(c) standard practices forrevising themonthly, quarterly, andannual data, including for
shuttle trade; and
(d) whether statistical reports arestillsubmitted byRussian participants inforeign trade
activity totheState Statistical Committee, andifyes,howthese reports areincorporated
intoforeign trade statistics.
Answer
(a)-(b) TheStateCustoms Committee oftheRussian Federation haspublished official collections of
customs statistics related toforeign trade andbased onprocessed datafrom customs cargo
declarations since 1994. Thecurrent system offoreign trade statistics includes:
- Monthly reports issued onthethirtieth dayaftertheendofthereporting month, which
contain dataregarding exports andimports intrade withallcountries ingeneral, as
wellasthatwithCIScountries andwithother foreign countries, andbreakdowns for
keyitems ofRussian exports andimports.
- Quarterlystatisticalnewsletters,includingcustomsforeigntradestatisticsfortheRussian
Federation,whicharepublishedonthesixtiethdayaftertherespectivereportingquarter.
They contain trade dataonacountry-by-country basis, aswellasbyexports andby
imports.
- Yearbook "Customs Statistics ofForeign Trade oftheRussian Federation," which goes
outofprintontheone-hundred-and-twentieth dayaftertheendoftherespective year
andcontains detailed information about theresults oftrade, broken down bythecountry
andbytheproduct category.
(c) Inaccordance withinternational practices, eachsubsequent publication revises dataforthe
preceding period, where necessary. Beginning withdataforthefirstquarter of1997, theState
Customs Committee willcollect shuttle tradedata.Allcustoms statistics publications relating
toforeign tradeareprepared using methods consistent withinternational standards. Theoutput
forms ofsuchpublications arealsoinlinewithworld practices.
(d) Participants inforeign economic activities havenotbeenrequired tosubmit earlier obligatory
government-form reports totheState Customs Committee since 1996.
TheRussian StateStatistics Committee initsmonthly official reports onthesocial andeconomic
situation inthecountry publishes export andimport data,including bothcustoms statistics and
calculationsregardingshuttle(unorganized)trade.Inaccordancewiththecustomsdatacollection
timetable, theStateStatistics Committee releases consolidated export andimport dataonemonth
aftertherespective reporting period andpresents amoredetailed version ofthisdatatwomonths
later.TheRussian StateCustoms Committee publishes quarterly statistics collections, "Customs
Statistics ofForeign Trade oftheRussian Federation" (during thethirdmonth following the
respective reporting quarter). Quarterly foreign tradedataissubsequently revised bytheState
Customs Committee, andthecorresponding changes arereflected, asarule,initsstatistical
collection published oneyearafter therespective reporting quarter. TheState Statistics
Committee takes account ofcustoms dataadjustments assoonasitisnotified ofthemthrough
routine working contacts bytheStateCustoms Committee. Thelatterdoesnotreceive statistical
reports from participants inforeign trade activities anylonger.WT/ACC/RUS/17
Page85
WT/ACC/RUS/13
Agreement onSubsidies andCountervailing Measures
Question 242.
(Question 7)CanRussia please explain onwhatbasis itconsiders thatitsexport insurance schemes
(inparticular "theestablishment, withtheassistance oftheState, ofasystem ofinsurance related
toexport operations toprotect them from long-term commercial risks") anditsincentive to
export-oriented production areconsistent withtheWTO, andnotably withpoints (j)and(d)of
Annex ItotheSCM Agreement?
Does theRussian Federation intend toinvoke Article 29oftheSCM Agreement tocover atleast
some ofthese measures?
Answer
Pending
TBT Related issues
Question 243.
TheRussian Federation isrequested toprovide acomprehensive response tothequestionnaire
relating toTechnical Barriers toTrade.
Answer
Theresponses totheWTO Questionnaire onTechnical Barriers toTrade arebeing prepared,
andwillbesubmitted induecourse.
Question 244.
Could Russia provide information onwhat "legitimate objectives", within themeaning ofArticle 2
oftheWTO Agreement onTechnical Barriers toTrade, arereferred to,andforwhat products,
when applying international standards "indirectly" asexplained intheanswer toquestion 16?
Answer
When answering thequestion about "legitimate objectives," itisnecessary topoint outthat
Russia doesnotintend togobeyond theirlimits assetinArticle 2,paragraphs 2and4,oftheTBT
Agreement ortogivethem anybroad interpretation.
ThewayRussia perceives theprovisions oftheTBTAgreement totheeffect thatdifferences
from international standards are,inprinciple, possible innational legislation, technical regulations
andstandards canbeillustrated bythefollowing examples:
- Theindustrial frequency ofelectric power inRussia is50Hz.Achangeover tothefrequency
of60Hz,which isusedinthevastmajority ofother countries, isatypical example ofa
technological problem (asmentioned inArticle 2,paragraph 4)arising when theissue of
harmonizing therequirements ofregulatory actsisaddressed.WT/ACC/RUS/17
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- Thecompositionoffoodstuffsconsumedbythepopulationisdeterminedbytraditionsofnational
cuisine, which predetermine thepredominance inalocaldietofsome products (asexemplified
bytheparticular popularity offishwithethnic groups residing inthenorth, mutton withpeople
living inthesouth, potatoes among vegetables withpeople living intheEuropean partofRussia,
etc.).Thiscircumstance necessitates theestablishment ofmorestringent requirements regarding
thecontents ofundesirable ingredients insuchproducts thanarefixedincountries withdifferent
dietary preferences. InRussia 'sopinion, thisisatypical example ofnecessary measures taking
account ofclimatic andother geographical factors (asmentioned inArticle 2,paragraph 4,
oftheTBTAgreement).
- Inkeeping withtheConstitution oftheRussian Federation, theRussian language isthelanguage
usednationwide, which makes itnecessary toexecute consumer markings ongoods, including
foreign-made goods, intheRussian language.
Thelistofsuchexamples can,ifneedbe,extended, butitisfundamentally important tostress
that,inRussia 'sopinion, theprovisions ofArticle 2,paragraph 5,oftheTBT Agreement onthe
substantiation oftechnical regulations andstandards should beinvoked withrespect toonlythose of
them whose requirements apply exclusively totheproducers (suppliers) ofimported products. Since
these requirements bearonbothdomestic entrepreneurs andtheirforeign partners, theprovisions of
TBTArticle 2,paragraph 1,onnon-discriminatory treatment arefullyobserved.
Question 245.
Initsresponse toquestion 16theRussian Federation alsomentions three different listsrelating
tofood additives. Could theRussian Federation please provide copies ofthese listsforthe
information ofWorking Party members?
Answer
TheRussian Committee onSanitary andEpidemiological Supervision byitsResolution
No.01-19/42-11 of24August 1994, hasapproved the"Food Additives" Supplement totheMedical
andBiological Requirements andSanitary Norms Regarding theQuality ofUnprocessed Food and
Foodstuffs.
Question 246.
TheRussian Federation states initsresponse toquestion 17that"thecurrent rules forthe
certification offoodstuffs andunprocessed foodprovide forpre-market certification, andthis
requirement continues tobeineffect". Does theRussian Federation foresee anychange inthis
requirement upon accession totheWTO, since thisiscontrary tointernational practices?
Answer
Please clarify howtherequirement thatfoodstuffs andunprocessed foods becertified before
being supplied tothemarket contradicts international practices.
Itisknown frominternational experience thatinorder toremove technical barriers totrade,
certification iscarried out,asarule, before aproduct isintroduced tothemarket andduring its
circulation onthemarket.
Regulatory andadministrative documents ineffect inRussia, inparticular, Resolution No.1
ofState Committee onSanitary andEpidemiological Supervision “OntheProcedure ofIssuance ofWT/ACC/RUS/17
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Hygienic Certificates Related toProducts ”of5January 1993, provide forthehygienic certification
ofproducts during thenegotiation ofacontract fortheirsupply.
Question 247.
Could theRussian Federation clarify further what ismeant by"reflecting thespecific needs of
thedomestic economy" initsresponse toquestion 18?
Answer
Inthecontext ofexplanations provided inanswer 244herein, "reflecting thespecific needs
ofthedomestic economy" means thesameas"legitimate objectives" withaccount taken ofanswer 248
herein.
Question 248.
IntheRussian Federation 'sinformative response toquestion 18,onequestion was,however, not
answered. Could theRussian Federation please identify thesectors inwhich deviations from
international standards exist?
Answer
Firstofall,thewaytheRussian sideunderstands "deviations from international standards"
needs tobeexplained.
Accordingtoavailabledata,thenationalsetsofstandardsincludeinGermany-17,000standards,
inFrance -15,000 standards, intheUnited States -38,000 standards, inChina -19,500 standards,
andinRussia -21,500 standards, compared withthe12,500 ISO/IEC standards.
Thesetsofnational standards inasubstantial number ofcountries thusarelarger than
international setsofstandards, which obviously attests tothefactthatawider range ofassets andtheir
aspects aresubject tostandardization atnational levels.
What attitude should, intheRussian side'sopinion, international andnational standardizing
organizations taketothose national standards (ortheirportions) which donothaveanalogs among
international standards?
Itisadvisable toestablish anapriori recognition procedure, prioritize theuseoftheimporting
country 'sstandards during export/import transactions, andremove suchnational standards fromamong
those which aresubject toprovisions ofArticle 2,paragraphs 2and5,oftheTBTAgreement, while
preserving, naturally enough, theobligation toprovide information andcopies ofdocuments.
Thisattitude isencouraged bythefactthatnational standards andtheneedtoharmonize different
national interests andbring themtoacommon denominator promote thedevelopment ofinternational
standards rather thanobstructing it.
Astotherestofnational standards, thesituation canbeasfollows:
- requirements setforthinnational standards maybestiffer thanthose ofinternational
standards;WT/ACC/RUS/17
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- requirements setforth innational standards maybelessstringent thanthose of
international standards.
Inthesituation described initem(2),theverynotion "deviations frominternational standards"
ismeaningless, since products exported toRussia (imported byRussia) andmeeting international
standards automatically conform withitsnational standards andthere actually arenorestrictions on
supplies andsalesofsuchproducts.
Therefore, theresponse totherequest to"identify thesectors inwhich deviations from
international standards exist" should boildown tolisting those Russian standards which make stiffer
requirements thaninternational standards.
Anoncommittal answer about suchstandards would bethattheyarefewandfarbetween and
mostly cover foodstuffs.
Alegally binding answer, meaning thattherearenoother suchstandards inRussia except those
expressly anddirectly stated insuchreply, canbemade byRussia, inpoint offact,onlyafterareview
andspecific comparison oftherequirements ofthe21,500 Russian standards andthe12,500 ISO/IEC
international standards, which willbeatime-consuming andcostly effort beneficial entirely forthe
sphere ofexports totheRussian Federation. Itcan,nevertheless, bestated thattheextent ofconformity
inthemechanical engineering sector is65-100 percentandthatintheelectrical engineering and
electronics sectors 40-75 percent, depending ontypes ofproducts.
Question 249.
Could theRussian Federation please provide alistoverthe"multilateral andbilateral agreement
towhich [theRussian Federation] isaparty" asreferred tointheresponse toquestion 19?
Answer
With aviewtolifting technical barriers totrade, theRussian State Committee onStandards
hasconcluded:
- withIsrael'sInstitute ofStandards -anAgreement onConformity Assessments ofProducts
Mutually Supplied byRussia andIsrael;
- withtheMongolian Ministry ofCommerce andIndustry -anAgreement onCooperation in
Conformity Assessments ofImported andExported Products;
- withtheBulgarian Committee onStandardization andMetrology -anAgreement onthe
Recognition ofResults ofTesting ofImported Products;
- withtheStateAdministration ofChina fortheInspection ofImported andExported Products,
anAgreement onCertification;
- withtheSlovak Agency forStandardization, Metrology andTesting, anAgreement onthe
Certification ofProducts Mutually Supplied Between theRussian Federation andtheSlovak
Republic;
- withtheCzech Agency forTechnical Standardization, Metrology andState Testing, an
Agreement ontheRecognition ofResults ofTesting ofProducts Mutually Supplied Between
Production andTrading Enterprises oftheRussian Federation andtheCzech Republic;WT/ACC/RUS/17
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- withthePolishCentreforTestingandCertification,anAgreementontheReciprocalRecognition
ofProtocols ofTesting;
- withtheVietnamese General Board forStandardization, Metrology andQuality, anAgreement
onConformity Assessments ofProducts Mutually Supplied Between Russia andVietnam;
- withtheSingaporean Institute forStandards andIndustrial Research (SISIR), aMemorandum
ofUnderstanding onProduct Testing forCertification Purposes.
AnAgreement onCooperation inConformity Assessments ofImported andExported Products
wasalsosigned between Russia andChina attheleveloftheirgovernments.
Alloftheabove agreements arebased oncompliance withinternational standards andrules
forconformity assessments intheinterest ofavoiding anunwarranted duplication ofcertification in
regulated fields.
Question 250.
Incases where aforeign product hasalready received international quality orstandardization
certification, including ISO,doesaforeign exporter havetoreceive theRussian safety certification
from theRussian Customs office according totheConsumer Protection Law?
Answer
Federal LawNo.2-FZ "OntheProtection oftheConsumers 'Rights" asamended, primarily
regulates therelationship between theconsumer andthemanufacturer aswellasbetween theconsumer
andtheseller. With regard tocertification, LawNo.2-FZ provides thatgoods, works andservices
maybesubject tomandatory certification iftheGovernment adopts aresolution providing so.
Additionally, pursuant toDecision oftheGovernment oftheRussian Federation No.799“OnMeasures
toProtect Consumer Market oftheRussian Federation from Low Quality Imported Goods ”of
12July1996, theGovernment directed theState Committee oftheRussian Federation for
Standardization, Metrology andCertification inconjunction withinterested federal executive bodies
tointroduce before 1September 1996amendments andaddenda tonormative actsoncertification which
wouldemphasizeasapriorityon-sitecertificationofproductsatmanufacturers’facilitiesandtocomplete
drafting standards oninspection methods, including express methods toidentify foodstuffproducts,
which should correspond tointernational standards.
With regard totherecognition offoreign certification, Federal Law No.5151-1 “On
Certification ofProducts andServices ”dated 10June1993, asamended, provides thatinternational
agreements takeprecedence overRussian legislation withregard tocertification andrules. Therefore,
recognition offoreign certification occurs onlyonthebasis ofmultilateral andbilateral agreements.
TheDecision oftheState Committee forStandards oftheRussian Federation No.3“On
Approval oftheRules onCertification intheRussian Federation ”dated 16February 1994, provides
thattheRules andRecommendation onCertification must comply withtherules setoutinthe
International Standardization Organization (ISO) manuals andtheInternational Electrotechnical
Commission (IEC), international standards ISO9000 10000, European standards 45000 and29000,
aswellasthestandards ofother international andregional certification organizations concerned with
certification.WT/ACC/RUS/17
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Question 251.
What aretheinspection orquarantine systems ofRussia ’sagricultural products including animals?
Answer
Pending.