RESTRICTED
WORLD TRADE WT/ACC/UKR/41
14October 1997
ORGANIZATION(97-4434)
Original: English Working Party onthe
Accession ofUkraine
ACCESSION OFUKRAINE
Additional Questions andReplies
TheGovernmental Commission onUkraine 'sAccession totheWTO hasprovided thereplies
reproduced hereunder tothequestions submitted bydelegations following theWorking Party meeting
heldon5-6May1997.
_______________
TABLE OFCONTENTS
Section Question Page
III.FOREIGN TRADE REGIME
1. Import Regulation 1-4 3
Tariff Exemptions andPreferences 5-6 5
Customs Tariff 7-13 5
Anti-Dumping andSafeguard Measures 14-17 8
Non-Tariff Measures, Quotas andLicensing 18-32 9
Standards andCertification 33-35 15
Sanitary andPhytosanitary Measures 36-49 17
2. Export Regulation, including Subsidies 50-51 20
IV. OTHER POLICIES RELATED TOFOREIGN TRADE
2. Agricultural Policies
Export Stimulation Measures, including Subsidies 52-62 23
State Trading inAgriculture 63-64 26
9. Trade Related Intellectual Property Rights (TRIPS) 65-76 27
V. TRADE AGREEMENTS
2. Regional Integration 77 35WT/ACC/UKR/41
Page2
III. FOREIGN TRADE REGIME
III.1 Import Regulation
Question 1.
VAT applicability inCIStrade. Wethank Ukraine fortheinformation provided, hutseektoclarify
howthearrangements currently operate.
Answer:
Thevalue-added tax(VAT) isapplied inUkraine inaccordance withtheLawofUkraine onthe
Value-addedTaxno.168/97-VRof3April1997.ExportsofgoodsfromthecustomterritoryofUkraine
areexempted from theVAT according tothelegislation (theVAT rateiszero). Reimbursement of
thepaidVAT toexporting enterprises (reimbursement ofthedebit balance oftheVAT settlements)
isconductedfromcorrespondingbudgetsintheplacesofincorporationoftheenterprises.Reimbursement
oftheVAT tobusiness activity entities thatexport goods (services) ofthattheyhavenotproduced
themselves isconducted aftertheirconfirmation thatthegoods tobeexported havebeenpaidforin
themoney form.
Ifamanufacturing company exports itsproducts itisreimbursed thepaidVAT inaccordance with
theactive procedure irrespective ofthetypeofoperation ofacquiring theparts orrawmaterials.
Thegoods imported intoUkraine areliable totheVAT inaccordance withthelegislation currently
inforce. TheVAT rateissetbytheLawofUkraine ontheValue-added Taxno.1168/97-VR of
3April 1997 atthelevelof20percentoftaxable object.
Thetaxable object fortheVAT isthecustom value ofgoods tobeimported intoUkraine including
thecustom duesandtheexcise taxforthegoods thatareexcise liable according tothelegislation of
Ukraine.
Inforeign trade between Ukraine andtheCIScountries andtheBaltic states, theVAT isapplied
differently: theRussian Federation andothercountries thataremembers oftheCustom Union -Belarus,
Kazakstan andtheKyrgyz Republic -thatapply foreign trade rules unified withthose oftheRussia
Federation according totheagreements ofthementioned Union currently inforce apply theVAT to
exports and(since 1996) toimports.
TheCIScountries thathave notjoined theCustom Union -Azerbaijan, Armenia, Georgia,
Tadjikistan, Turkmenistan, Uzbekistan -apply theVAT according totheruleoforigin, i.e.toexports.
Moldova imposes theVAT onthegoods imported from Ukraine.
TheBalticstates-Latvia,Lithuania,andEstonia-applytheVATaccordingtotheruleofdestination,
i.e.toimports when trading withUkraine.
Question 2
Ukraine recalled inthisdocument thatitwilllevyforproducts, subject toexcise duties, customs
duties upto70percentadvalorem. Isthismeasure atemporary provision orwillUkraine reserve
thisright after thedateofaccession?WT/ACC/UKR/41
Page3
Answer:
Thisdocument saysthatUkraine reserves therighttotemporarily increase dutyrateto70percent
advalorem oncommodities subject toexcise taxlisted intheConcept ofTransformation ofCustoms
Tariff ofUkraine, andonlywhile market access negotiations areinprocess.
Question 3
What arethecontrol measures applied bytheUkrainian authorities tosupervise theactivities
offoreign economic agents? Arethose measures thesame asfornational economic agents? What
doesUkraine specifically mean by"unfair fulfilment ofobligations"?
Answer:
Ukraine hasadopted theState Program forcontrol ofsettlements between Ukrainian andforeign
companies inforeign economic transactions, andtheMinistry ofForeign Economic Relations andTrade
isresponsible forcoordination ofactivities between theStateCustoms Service, authorized banks and
taxauthorities.
Inthecourse ofthiswork, theMinistry collects adatabase onmutual settlements anddebts (accounts
payable andreceivable) between Ukrainian andforeign partners. Inthisway, control overforeign
companies 'abiding byUkrainian legislation onforeign currency transactions isexercised.
TheLawofUkraine "OnForeign Economic Activities" isthelegislative basefortheabove system
ofcontrol. Article 37thereof provides forimposition ofspecial administrative sanctions forviolation
ofUkrainianlegislationonforeigncurrencytransactions,bothonforeignandUkrainianbusinessentities.
Decisions toimpose suchsanctions aretaken bytax,judicial andlawenforcement authorities, and
suchdecisions areenforced bytheMinistry ofForeign Economic Relations andTrade, andtheState
Customs Service. Final resolution ofdisputes onmutual settlements arising between business entities
isperformed onlybytheInternational Commercial Court ofArbitration under theUkrainian Chamber
ofCommerce andIndustry. Similar sanctions arealsoimposed incases ofinfringement ofanti-trust,
unfair competition andanti-dumping legislation.
Question 4
Imports ofcarsissubject totaxation ongeneral terms. Thetaxes levied arecustoms duties ,excise
andVAT. Aretheexcise rates andtheVAT thesame fordomestic produced carsandforimported
ones? Why arethose products notlisted under document WT/ACC/UKR/38 which provides the
listofproducts subject toexcise?
Answer:
Trade turnover onlorries andpassenger carsproduced byUkrainian enterprises ofalltypes of
ownership fromforeign andUkrainian partsisnotsubject toexcise dutyupto2007provided thatthey
areproduced inamount notlessthan1000 items peryear.
Inanother case, excise ratesarethesame fordomestic produced carsandforimported ones.WT/ACC/UKR/41
Page4
Tariff Exemptions andPreferences
Question 5
Theinformation provided inquestion 22doesnotclearly address thesituation, andweseekfurther
details.
Answer:
Asitwasinformed intheanswer toquestion 22ofWT/ACC/UKR/25, goods under State contracts
andorders aresubject totaxation ongeneral terms.
Question 6
Theadvalorem feewillneedtobereplaced byaspecific feetocomply withGATT Article VIII
andweseekdetails ofUkraine 'splans inthisregard.
Answer:
According totheResolution oftheCabinet ofMinisters ofUkraine No.65of27January 1997
"OnCustoms Duty Rates" specific dutyrateswereestablished which reasonably reflected thelabour
costsofcustoms officers andamounts ofthecustoms dutyratestobeapplied tocargo during thecustoms
clearance.
Customs Tariff
Question 7
Wecannot findinthemost recent documentation Ukraine 'sresponse toourearlier request that
itdescribe thelawand/or regulatory procedures bywhich theUkraine meets theobligations under
theWTOAgreementonRulesofOriginforissuingassessmentsoforiginwithin150daysofrequests
byexporters andimporters, asprovided forunder Article 2(d)oftheAgreement. Please provide
ananswer tothisquestion.
Please describe thelawand/or regulatory procedures bywhich such assessments shall remain
valid forthree years, asprovided forunder Article 2(j)oftheWTO Agreement onRules ofOrigin.
Please describe thelawand/or regulatory procedures bywhich anyadministrative actions taken
bythegovernment oftheUkraine takes inrelation tothedetermination oforigin isasrequired
byArticle 2(j)oftheWTO Agreement onRules ofOrigin: "reviewable promptly byjudicial,
arbitral oradministrative tribunals orprocedures, independent oftheauthority issuing the
determination, which caneffect themodification orreversal ofthedetermination".
Please describe thelawand/or regulatory procedures bywhich allinformation, asisrequired
bytheArticle 2(k)oftheWTO Agreement onRules ofOrigin: "that isbynature confidential
orthatisprovided onaconfidential basis forthepurpose oftheapplication ofrules oforigin
istreated asstrictly confidential bytheauthorities concerned".
Answer:
TheResolution oftheCabinet ofMinisters ofUkraine of30July1996 no.846"OnVerification
ofCertificatesofOriginofGoodsfromUkraine"approves,thatverification(determiningofauthenticity)
ofcertificates oforigin ofgoods fromUkraine isconducted exclusively bytheStateCustoms Service
ofUkraine.WT/ACC/UKR/41
Page5
According totheabove mentioned Resolution oftheCabinet ofMinisters ofUkraine theEdict of
theStateCustoms Service ofUkraine of01April 1997 no.143(registered intheMinistry ofJustice
ofUkraine under thenumber 148/1952) approved theRegulations onprocedures ofverification of
certificates oforigin ofgoods from Ukraine bythecustoms authorities, which provides that:
-verification ofcertificates oforigin ofgoods fromUkraine isconducted bytheStateCustoms Service
ofUkraine basing ontheinquiries ofcustoms authorities ofother countries within 150daysperiod
from thedateoffiling suchinquiry;
-theprotocol ofexamination ofcertificate oforigin ofgoods fromUkraine andnotification onthe
results ofsuchexamination arestored forthreeyears fromthemoment ofapproval ofthisprotocol;
-allinformationonconductedexaminationofcertificateoforiginofgoodsfromUkraineisconfidential
andcanbeusedonlywithcustoms control purposes.
With thisweremark, thatthedraftoftheCustoms Code ofUkraine (Article 111)provides, that
thepreliminary decision ongoods, transported overthecustoms border ofUkraine staysineffect for
oneyear.
Question 8
Ukraine hadindicated thatitsnewCustoms Code might address thedeficiencies initscustoms
valuation regime identified intheprevious regulations. Theprovisions ofthenewCustoms Code,
however, stilldonotappear tobeinfullconformance with theWTO Agreement onthe
Implementation ofArticle VIIoftheGATT 1994, ortheWTO Customs Valuation Agreement.
Wehave noted deficiencies inthefollowing areas:
Article 354. This provision provides fortheconfidentiality ofinformation, except when the
legislation oftheUkraine provides fordisclosure. Could theUkrainian Government provide
examples oftheexceptions ordescribe thecircumstances under which such exemptions would
prevail?
Answer:
Thecases orconditions, when disclosure ofconfidential information ispossible, arethe
commencement ofcriminal procedures forbusiness entity inforeign economic activities.
Question 9
Article355.Thisprovisionrequiresthatthevaluedeclaredmustbe"basedonreliable,documentary
confirmedinformationthatisdeterminedquantitatively".CouldtheUkrainianGovernmentprovide
anexplanation ofthisprovision, particularly howavalue is"determined quantitatively".
Answer:
Probably, thisquestion isasked duetoinadequate translation. ThisArticle implies notthatthevalue
isadded "inquantitative terms", butthattheinformation, thatapproves thedetermination ofcustoms
value, shall befiledinquantitative terms, sothatthere isapossibility ofapplying suchdatafor
calculation.WT/ACC/UKR/41
Page6
Question 10
Thefinal paragraph inArticle 355requires thatanimporter payduties notwithstanding that
there isanextension oftheperiod ofcargo processing because ofthedetermination ofcustoms
value. Does theUkrainian legislation contain aprovision forrelease ofgoods prior tothe
determination ofthefinal value, iftheimporter provides sufficient guarantee intheform ofa
surety orother deposit asrequired byArticle 13oftheValuation Agreement?
Answer:
ThedraftCustoms Code (Article 85)provides thatincasethedeclaring person cannot declare goods
infullamount duetosome reasons (except forgoods transitted through theterritory ofUkraine), when
crossing thecustoms border ofUkraine orwithin theperiod established bylegislation, thensuchgoods
maybereleased bythecustoms authority forfreeutilization upon filing oftemporary orincomplete
declaration under obligation offiling ofordinary filled customs declaration within theperiod established
bythecustoms authority, butnotlaterthan30daysofthedateofrelease ofgoods forfreeutilization.
Thedecision onrelease ofgoods forfreeutilization andfiling ofcustoms document infullamount
afterwards ismade bythecustoms authority basing ontheconditions, ofcrossing ofcustoms border
ofUkraine bysuchgoods, andonthecharacteristics ofanenterprise.
Question 11
CouldweobtainmoreclarificationonthedifferentmethodsofcustomsvaluationappliedinUkraine
andmore specifically onmethod No6related toarticle 7ofrespective GATT 94agreement?
Answer:
TheprocedureofdeterminingthecustomsvalueofgoodsimportedinthecustomsterritoryofUkraine
which meets therequirements oftheGATT ’sCustoms Valuation Agreement, isincluded asanintegral
partinthedraftCustoms Code ofUkraine andsubmitted forconsideration totheVerkhovna Rada
ofUkraine.
Temporarily, untiladoption ofthenewCustoms Code ofUkraine, thecustoms value andcustoms
valuation ofgoods aredetermined inaccordance withArticle 16oftheLawofUkraine "OntheUniform
Customs Tariff". Ifverification ofthedocuments presented isnotpossible, orifthecustoms value
declared isinappropriate, thenpursuant toPartTwoofArticle 16oftheLawofUkraine OntheUniform
Customs Tariff forthepurposes ofcustoms valuation, thevalue ofgoods, which havebeenimported
andregistered interms ofthecustoms registration, andareidentical togoods subject tocustoms
valuation, isanalyzed andcompared. Thefollowing isverified: origination fromonecountry, produced
byoneproducer, aredesigned forthesame purpose andhavethesame quality, havethesame mark,
codenumber, etc.
Incaseoftheabsence ofthefactofimporting identical goods, customs valuation iscarried out
onthebasisofprices forsimilar goods, i.e.those goods thatare,although notidentical inallrespects,
alikebytheircharacteristics andmaybemutually substituted. Thecountry oforigin isherewith first
ofalltaken intoaccount aswellasitsproducer.
With regard tovaluation procedure under method 6concerning Article 7oftherelevant GATT
Agreement we,hereby, inform thatvaluation ofgoods isconducted onthebasis ofinformation on
thecostofgoods, which maybedetermined upontheanalysis andadjustment torelevant indices (quality,
quantity, seasoning, etc.)according tothedatacontained intheprice-lists ofproducer ’scommercial
offers, anddataofthetrade andeconomic missions, etc.WT/ACC/UKR/41
Page7
Question 12
Weseekfurther details onthesituation asregards seasonal duties.
Answer:
Seereply toquestion 26ofWT/ACC/UKR/25/Add.1
Question 13
Document WT/ACC/UKR/29 provides theconsolidated listofchanges totheSHonimport duty
rates. Several tariff headings present some compound duties. Does Ukraine intend tointroduce
some compound duties bound offer orkeep onlyadvalorem rates?
Answer:
Specific andcombined tariffs willbeeliminated according totheschedule. Onethirdofthesetariffs
willbeterminated byMarch 1998, theremaining twothirds willbeterminated by30June1998.
Anti-dumping andSafeguard Measures
Question 14
Wewelcome theadvice inreplies toquestions 28to32(WT/ACC/UKR/25/Add.1) thatUkraine 's
legislation onanti-dumping andsafeguards willbebrought intocompliance withWTO agreements.
Wewould begrateful forinformation onanindicative timeframe forthisprocess.
Answer:
Theanti-dumping Codex, thatcomplies withArticle VIGATT 94,waselaborated bytheMinistry
ofForeign Relations andTrade ofUkraine. Itisbeing worked outbytheCabinet ofMinisters of
Ukraine. After itisadopted bytheSupreme Rada ofUkraine, theWTO Secretariat willbeinformed.
Question 15
Could theUkrainian delegation provide more information onthepresidential decree No478/96
onthe"Implementation Procedure forElimination ofImports ofGoods" toeliminate theamounts
ofimports thatwould damage therespective industries ofthenational economies?
HasUkraine applied suchmeasures sofar?Ifyes,forwhich products?
Answer:
Thetranslation oftheDecree ofthePresident ofUkraine "OnProcedures forApplication of
Restrictions onImport inAccordance withRules andPrinciples ofGATT/WTO" wassubmitted to
WTO Secretariat before fourth meeting oftheWorking Party.
Procedures, mentioned intheDecree ofthePresident ofUkraine, havenotbeenapplied yet.
Question 16
Thepolicies listed inSection 4ofdocument WT/ACC/UKR/34 aimtoincrease import duties to
protect domestic producers incases when appropriate goods wereproduced orcould beproduced
inUkraine insufficient quantity. Arethose measures temporary? Ifnot,howdoesUkraine justify
them regarding totherelevant GATT 94provisions?WT/ACC/UKR/41
Page8
Answer:
Thepolicies listed inSection 4aretemporary. Inthefuture thepolicies aimed onreduction of
volumes ofimport willbedetermined onlyaccording totheDecree ofthePresident ofUkraine "On
Procedures forApplication ofRestrictions onImport inAccordance withRules andPrinciples of
GATT/WTO".
Question 17
WhenwillthelegislationofUkraineonissuesconnectedtotheapplicationofanti-dumpingmeasures
bebrought intocompliance withtheprinciples ofarticle VIofGATT 94?
Answer:
Seereply toquestion 14.
Non-Tariff Measures, Quotas andLicensing
Question 18
AtthelastWorking Party meeting in1996 Ukraine promised tolookintotheissue ofconsent
bymultiple administrative agencies toensure thatthere wasnohindrance totrade. HasUkraine
completed thisreview? Ifso.could Ukraine provide anupdate fortheworking party? What
arethecriteria interms ofprocedures, documentation, andfeesapplied byeachofthese bodies?
Answer:
Procedure forissuance ofimport licenses
1. Theissuing ofimport licenses tobusiness entities thatareregistered intheterritory
ofUkraine,irrespectiveoftheirformofownership,shallbecarriedoutbyMinistryofForeignEconomic
Relations andTrade ofUkraine andbyagencies authorized bythelatter.
Thelicenses shallbeissued inaccordance withaprocedure setforthinarticle 16ofLawofUkraine
"OnForeign Economic Activity" andthese Regulations.
2. Forpurpose ofobtaining alicense, itisrequired tosubmit thefollowing documents:
2.1. anapplication foralicense, prepared asrequired (aformisenclosed, seeAnnex 2);
2.2. Aletter requesting issuance ofalicense andguaranteeing payment ofthestateduty
fortheissuance ofsuch;
2.3. Acopyofacontract withspecifications, verified bymanagement ofanenterprise in
accordance withestablished procedures;
2.4. Acopyoftheenterprise ’sgovernment registration certificate, verified bymanagement
ofanenterprise inaccordance withestablished procedures;
2.5. Apermission issued byanagency authorized inaccordance withtheaddendum to
Resolution ofCabinet ofMinisters ofUkraine of12.31.97 No.1590 "Onthelistof
goods importation ofwhich in1997 issubject tolicensing";WT/ACC/UKR/41
Page9
2.6. Aproduct examination actissued bytheChamber ofTrade andCommerce, orits
regional division, withtheproduct ’scodespecified inaccordance withCNFEA;
3.Thedateoffiling anapplication foralicense shallbethedatewhen itisregistered withtheMinistry
ofForeign Economic Relations andTrade ofUkraine, orwithanagency authorized bythisMinistry,
provided thatitcanbesubstantiated byarecord inaregistration journal.
4. Inthecaseofanincorrectly prepared application foralicense, orfailure tofileall
required documents specified initem2.2ofthese Regulations, thedocuments shallnotbeaccepted.
5. Theissued licenses shallbeeffective during theperiod specified inthecontract and
shallbevalidforpurposes ofcustoms clearance during thisperiod, butnotafter31December 1997.
6. Import licenses shallbeissued bytheMinistry ofForeign Economic Relations and
Trade ofUkraine andbytheauthorized agencies strictly oncondition ofavailability ofadocument
verifying thefactofpayment ofthestatedutyforsuchlicense, theamount ofwhich isdetermined
inaccordance withResolution oftheCabinet ofMinisters ofUkraine of8February 1996No.383 "On
theamount ofstatedutycharged forissuance ofimport licenses".
7. Import licenses maynotbetransferred toother legalentities.
8. Import licenses shallbeissued inonecopy.
9. Decision onwhether toissueorrefuse toissueanimport license mustbemade within
15working dayscounting fromthedateofregistration ofanapplication withtheMinistry ofForeign
Economic Relations andTrade ofUkraine, orwithanagency authorized bythelatter.
10. Decision torefuse toissue animport license maybemade if:
- submitted documents donotmeettherequirements ofthelawsofUkraine currently
ineffect;
- theentity isnotpermitted tocarry onforeign economic activities, based onarticle
37ofLawofUkraine "OnForeign Economic Activities".
11. Thedecision oftheMinistry ofForeign Economic Relations andTrade ofUkraine,
oranagency authorized bythelatter, nottogrant animport license maybeappealed bythebusiness
entity incourt.
Question 19
AretheChambers ofCommerce located inUkraine orabroad? What isthelegal authority of
theChambers ofCommerce? Arethese chambers comprised oflocalproducers? What "expertise"
isprovided bythechambers ofcommerce indetermining thehealth andsafety ofaproduct? Does
adomestic producer ofpharmaceuticals ofpesticides need togetthisexperts certificate? What
istheroleoftheChamber ofCommerce indetermining theconformity ofimported goods with
technical, pharmaceutical, sanitary, phytosanitary, veterinary andecological standards?
Answer:
TheUkrainian Chamber ofCommerce andIndustry isapublic non-governmental organization.
Ithas25branch offices invarious cities ofUkraine. Ukrainian producer-enterprises maybecome the
CCImembers upontheirownchoice. Asfarastheexpertise ontheproduct safety andgoods conformityWT/ACC/UKR/41
Page10
withdifferent standards isconcerned theCCImayconduct avoluntary expertise andcertification as
requested bytheenterprises andorganizations. Ifsafety andconformity withstandards iscompulsory
these services arerendered byDERZHSTANDARD ofUkraine.
Asperobtaining thecertificate oforigin foraproduct thecommerce andindustry chambers of
Ukraine when issuing certificates areguided bytheterms andconditions ofbilateral agreements
concluded between Ukraine andother countries oftheworld. Thisisunderlying theissuance ofone
oranother formofcertificate oforigin. Ifthere isnosuchagreement, thecertificate isgranted based
onthegeneral rules established bytheLawontheUniform Customs Tariff ofUkraine. Inorder to
obtain thecertificate oforigin theexporter (commodity producer oranintermediary) shallhavethe
recourse tothechamber ofcommerce andindustry andpresent necessary documents which confirm
theUkrainian origin oftheproduct (listsofdocuments areattached inAnnex 1).Theexporter shall
filloutthedeclaration form(attached inAnnex 2),certify itwithhissealandsignature, andpayfor
theservices rendered atthefixedrate(bytransfer orincashtotheaccounting department ofthechamber
ofcommerce andindustry).
Question 20
Please explain therelationship between indicative prices andalicensing regime based onhealth
andsafety concerns.
Answer:
Hereunder isalistofgoods, import ofwhich issubject tolicensing in1997:
(i) pesticides andherbicides;
(ii) pharmaceutical preparations;
(iii) cosmetic preparations andpersonal hygiene products;
(iv) veterinary preparations.
Itshould benoted thatMFERT (theMinistry ofForeign Economic Relations andTrade) hasnever
fixed indicative prices forthese goods. Thisgroup ofgoods isnotcovered byArticle 19oftheLaw
ofUkraine "OnForeign Economic Activity" asregards thegoods which aresubject tospecial import
procedures. Licensing forthelistofgoods isprovided pursuant toArticle 16ofthesaidLaw, and
according totheDecree ofthePresident ofUkraine No.124/96 of10February 1996indicative prices
arenotsetforthisroupofgoods. Licensing ofenlisted goods isearned outforthepurpose ofimporting
onlythose goods which bytheirpharmacological, sanitary, phytosanitary andveterinary characteristics
donotviolate theminimal requirements oftherelevant standards andconditions thatareinforce in
theterritory ofUkraine.
Question 21
Doestherecognition thatcontract prices candeviate from indicative prices foravariety ofreasons
mean thatprice deviations areaccepted?
Answer:
Thecontract pricemaydiffer fromindicative price. Itmayhappen duetovarious reasons, including:
- terms ofpayment;
- various quality standards;
- terms ofdelivery ofgoods.
Allmentioned above areacceptable deviations ifcontract prices arefixedforalistofgoods subject
toindicative prices.WT/ACC/UKR/41
Page11
Question 22
HasUkraine everrefused togrant alicense duetodeviations from theindicative price?
Answer:
Asthereisnoindicative prices forimported goods thataresubject tolicensing, therehasbeennorefusal
astogranting licenses duetoexisting deviations from indicative prices. Inanyevent, thedeviation
ofcontract price from indicative price willnotbeareason forrefusing togrant license orregister
acontract.
Question 23
Ukraine charges afeeof0.1percentforprocessing ofimport license applications. Ukraine also
states that"inorder toadjust thelegislation ofUkraine onimport licensing totheGATT/WTO
requirements, theResolution oftheCabinet ofMinisters ofUkraine of2August 1996 No.893
'OntheAmount ofSlate FeeforIssuing Import Licenses 'provides forthestate feeforissuing
import licenses attheamount of15times untaxable minimal personal income." Itisnotclear
howthisceiling relates tocostrecovery. Howwasthisfigure chosen? Isthis15times theannual
ormonthly minimal personal income? Howdoesthisamount relate totheactual costofprocessing
theapplications?
Answer:
Tomake Ukrainian legislation governing licensing consistent withGATT/WTO requirements, the
Cabinet ofMinisters ofUkraine 'sresolution of2August 1996 No.893"OnState dutycharged for
issuance ofimport licenses" provides forsetting thisdutyinthefixed amount equalling 15minimum
tax-exempt personal incomes. Thisamount wasdetermined ontheground ofestimated administrative
costs oftheMinistry ofForeign Economic Relations andTrade ofUkraine andoftheagencies that
decide ongranting permission toissueimport licenses, which amounted to255Hryvnias, which equals
15minimum tax-exempt monthly personal incomes.
Inaddition tothatweinform youthattheminimum tax-exempt monthly personal income is
determined inaccordance withDecree ofthePresident ofUkraine No.1082/95 of11November 1995,
intheamount of17Hryvnias permonth. Thistax-exempt amount remains unaltered foranextended
period andisusedforcalculating salaries anddetermining respective administrative expenses. Itis
alsousedasanconventional fixed amount currently equal to17Hryvnias.
Question 24
Question 7oftheImport Licensing Questionnaire solicits information onthetiming forlicenses
thatareNOT associated withquantitative limits. Since Ukraine saysitusesasystem withno
quantitative restrictions, Ukraine should answer these questions toprovide transparency. Please
provide ananswer tothefollowing parts ofquestion 7:
Where there Isnoquantitative limitonimportation ofaproduct oronimports from aparticular
country:
(a) How farinadvance ofimportation must application foralicense bemade? Can
licenses beobtained within ashorter time-limit orforgoods arriving attheport
without alicense (forexample, owing toinadvertency)?
(b) Canalicense begranted immediately onrequest?WT/ACC/UKR/41
Page12
(c) Arethere anylimitations astotheperiod oftheyearduring which application
forlicense and/or importation maybemade? Ifso,explain.
(d) Under what circumstances mayanapplication foralicense berefused other than
failure tomeet theordinary criteria? Arethereasons foranyrefusal given tothe
applicant?
Answer:
(a)Theresolution oftheMinistry ofForeign Economic Relations andTrade ofUkraine No.145of
19March 1997adopted theprovision onimport licensing procedure, according towhich thedecision
onissuing theimport license mustbemade nolaterthan15working daysafterthedateonwhich the
application wasregistered withtheMinistry ofForeign Economic Relations andTrade ofUkraine
(MFERT), orbyanagency authorized bythisministry, withtheaverage period ofissuing thelicense
being 7-10working days. Theimport licensing procedure isestablished asuniform forallbusiness
entities.
(b) Issuance ofimport licenses iscarried outinaccordance withtheuniformly applied
procedure thatwasadopted bytheresolution ofMFERT ofUkraine No.145 of19March 1997, within
theperiod nolonger than15work days.
(c) There arenolimitations concerning timeoftheyearwhen theapplication foranimport
license maybefiled.
(d) According totheeffective procedure adopted bythementioned above resolution of
MFERT ofUkraine No.145 of19March 1997, adecision nottoissueanimport license maybemade
onlyif:
- submitted documents don'tmeettherequirements ofeffective lawsofUkraine;
- thebusiness entity isprohibited toengage inforeign trade transactions inaccordance
witharticle 37ofLawofUkraine "OnForeign Trade Activities," which applies to
business entities thatviolate thislawofother related lawsofUkraine.
Thedecision ofMFERT ofUkraine, oroftheagency authorized byit,torefuse togrant animport
license maybeappealed bythebusiness entity inaccordance withestablished judicial procedures. Such
adecision isconveyed tothebusiness entity inwritten withreasons oftherefusal explained.
Question 25
InWT/ACC/UKR/23,response14,andinWT/ACC/UKR/25/Add.l.Ukraineslatesthat"thevalidity
term ofthelicense isfixed according totheapplication andcanbeextended upon theapplicants
request, hutnotlonger thantilltheendoftheyear." Itisstillnotclear howtheterm ofvalidity
isset.
-Does"fixed according totheapplication" mean thattheapplicant canselect aperiod ofvalidity?
-Does"notlonger thanuntiltheendoftheyear" mean thatlicenses runaccording tothecalendar
year? Doalllicenses expire on31December?
Answer:
Thephrase "established inaccordance withtheapplication" means thatabusiness entity mayitself
choose during whatperiod thelicense shallbevalid.
Thephrase "nolaterthantheendoftheyear" means thatimport licenses expire on31December.WT/ACC/UKR/41
Page13
Question 26
Using anindicative listofprices toensure thatimports arenotmore expensive than domestic
products isanunusual approach. Usually, countries useindicative price listtoensure thatimports
arcnotundervalued.WhydoesUkrainecareifimportsaremoreexpensivethandomesticproducts?
Answer:
Indicative prices forimported goods thataresubject tolicensing donotexist.
Question 27
ThefactthatUkraine takes prices intoconsideration when deciding whether toissueimport licenses
implies thatthelicensing isdiscretionary. According totheUruguay Round Agreement on
Agriculture, allquantitative restrictions (including discretionary import licensing) onagricultural
products arcprohibited.
Answer:
While granting animport licence, Ukraine doesnottakeanyprices intoconsideration.
Question 28
What goods aresubject tospecial import procedures according totheArticle 19oftheLawof
Ukraine "OnForeign Economic Activity?"
Answer:
Seereply toquestion 34ofWT/ACC/UKR/25/Add.1
Question 29
Inrelation totheanswer given toquestion 27ofWT/ACC/UKR/23/Add.1, wewould beinterested
ingetting further clarification onthefollowing:
(a) What arethebasis forexamining prices before deciding ontheissuance ofimport
licenses, taking intoaccount Ukraine 'sstatement that"licensing isimplemented withthepurpose
ofensuring technical, pharmacological, phytosanitary, veterinary andecological regulations are
adhered to"?
(b) Whatkindofrelationshipexistsbetweentheuseofindicativepricesandtheissuance
ofimport licenses?
Answer:
(a)Thegrounds forgranting alicence isanauthorization byrelevant organizations incaseifthisproduct
meets theminimal requirements ofdomestic standards.
(b) Norelationship exists.
Question 30
Questions 6and36(WT/ACC/UKR/25/Add.1) refer. Ukraine 'sanswer relates onlyto1997, and
weregard itaspositive thatthere arenoquotas currently inplace. Wealsointerested infutureWT/ACC/UKR/41
Page14
plans, andseekanexplanation ofthecircumstances inwhich quotas might heimplemented and
theWTO justification.
Answer:
Inthefuture restrictions onimport maybeapplied according totheDecree ofthePresident of
Ukraine" OnProcedures forApplication ofRestrictions onImport inAccordance withRules and
Principles ofGATT/WTO", which complies withtheAgreement onSafeguard measures ofUruguay
Round.
Question 31
Itisunclear from theanswer astowhether ornotimport licensing feesarelevied onapercentage
orabsolute basis. Weshould begrateful forclarification andforconfirmation thatimport licensing
feeswillbelimited inamount totheapproximate costs ofservices rendered inconformity with
GATT Article VIII.
Answer:
Seereply toquestion 34ofWT/ACC/UKR/25/Add.1
Question 32
Inorder toadjust thelegislation ofUkraine onimport licensing totheGATT/WTO requirements,
theResolution No893ofAugust 1996 provides fortheState feesforissuing import licenses at
theamount of15untaxable minimal personal income. Could weobtain more information onthis
amount? Considering thefrequent changes inthisminimum personal income inUkraine, how
could theUkrainian delegation justify suchanamount?
Answer:
Thestatedutycollectedforissuanceofalicenseisdeterminedonthebasisofestimatedadministrative
costsoflicense issuance andequals 255Hryvnias, which is15minimum tax-exempt personal incomes.
Theamount ofthetax-exempt personal income wasestablished bytheDecree ofthePresident ofUkraine
No.1082/95 on21November 1997, andsince thenhasnotbeenchanged.
Standards andCertification
Inspection byConsumer Association. Wewould beinterested infurther elaboration oftheanswers
toquestions 4-9inUKR/23/Add.1. Inparticular:
Question 33
Based onthese responses, itisourunderstanding thattheUkrainian Consumers Association and
similar organizations donothavetheright toseize, ontheir ownauthority, products which they
believe maynotconform withsafety andquality standards. Rather, these organizations may,
onthebasis oftheir independent inspections, request thattheresponsible government agencies
takesuchaction. Please confirm thatthisisthecase.
Answer:
Ifcertain goods (services) donotmeet effective standards orother requirements containing in
regulatory documents, thebodies oftheStateCommittee ofUkraine forProtection ofConsumer Rights
may, ontheground ofmaterial evidence obtained through investigations, levyfinancial penalties on
business entities asprovided inArticle 23ofLaw"OnProtection ofConsumer Rights" orimpose
administrative finesonemployees andofficials ofbusiness entities inaccordance withUkraine ’sCodeWT/ACC/UKR/41
Page15
onAdministrativeInfringements,inparticular,forfailingtoensurethatone’sproducts(services)comply
witheffective requirements specified instandards andregulations (seeArticles 167,168and1681),
forproducing ordistributing goods without having beengranted theproduct-quality certificate, ifhaving
suchcertificate isobligatory (Article 1701),ormayimpose financial penalties asprovided inArticle 17
ofLawofUkraine "OnState Control Over Production andDistribution ofEthyl Alcohol (either of
cognac orfruittypes), Alcoholic Beverages andTobacco Products".
Question 34
Doesthe"Law ontheProtection ofConsumers 'Rights" orother legislation andregulations provide
anyauthority totakeaction, onthebasis ofconsumer complaints against products which comply
withpublished safety andquality standards? Ifnot,what procedures have been established to
ensure thatdecisions relating toconsumer petitions areconsistent withestablished standards and
withWTO obligations.
Answer:
AccordingtoArticle26ofLawofUkraine"OnProtectionofConsumerRights",publicorganizations
(associations) ofconsumers maysubmit togovernment bodies andbusiness entities theirproposals
aimed toenhance quality ofgoods (work, services) ortosuspend manufacturing ordistribution ofgoods
(work, services) thatdonotmeeteffective quality standards, terminate manufacturing orputoutfrom
thedistribution netgoods (work, services) thatarehazardous tolife,health orproperty ofcitizens
ordangerous totheenvironment, aswellasabolish prices setinviolation ofapplicable enacted laws.
Question 35
Aretherules related totechnical barriers totrade obligatory inUkraine oraretheyoptional?
TheUkrainian rules withinternational standards been achieved onlyinthefieldoflife/health
protection andenvironmental security oralsoinother sectors? Could Ukraine provide aspecific
timetable ofthose harmonization plans?
Answer:
Under theWTO Agreement onTechnical Barriers toTrade, every country maycarry onmeasures
necessary toensure protection oflifeandhealth ofpeople, aswellasproper protection ofthe
environment. Oneofsuchmeasures implemented inUkraine isthemandatory certification ofspecific
categoriesofproducts,whichmustmeetcertainobligatoryrequirements.Impositionofsuchrequirements
isregulated byapplicable legislative acts.Suchobligatory requirements include those aimed toensure
thatproducts aresafewithrespect tolife,health andproperty ofconsumers, toprotect natural
environment, ensure compatibility andinterchangeability ofproducts, meetwork safety andhygiene
standards. Explanations concerning obligatory andrecommended requirements relating toUkrainian
standards wereprovided aspartofanswers tothequestions made inthecourse ofthepreparation for
thefourth meeting oftheWTO commission
Development anddirect implementation ofinternational andEuropean standards constitute thechief
direction inwhich Ukraine 'snational standardization system isdeveloping. Ukraine joined theCode
ofFairPractice (Addendum 3totheWTO/GATT Agreement onTechnical Barriers toTrade) in
December 1996. Ukraine hasbecome fullmember ofinternational standardization organizations, such
asInternational Standardization Organization (ISO), International Electrotechnical Commission (IEC),
acorrespondentmemberoftheInternationalOrganizationforLegislativeMetrology(OILM)andacquired
membership intheInternational information network ISONET. Ukraine wasthefirstCIScountry that
hadbecomeacorrespondentmemberoftheEuropeanCommissionforStandardization(CEN).Currently,
Ukraine 'sjoining theEuropean Commission forStandardization inElectrotechnical Sector isnearing
itscompletion. There aremorethan120technical standardization commissions thatoperate inUkraine,WT/ACC/UKR/41
Page16
withtheparticipationofwhichduring1992-1997period1,900statestandardsofUkraineweredeveloped,
withabout 60percentofthesestandards being consistent withrespective international safety andother
standards. Approximately 300standards ofinternational standardization organizations ISOandIEC,
including quality system standards oftheseries ISO9000 havebeenintroduced inUkraine andgiven
thestatus ofUkrainian national standards. Thepreparation fordirect implementation inUkraine of
international standards relating toenvironmental control oftheseries ISO14000 hasbeencompleted
andsince1January 1998, thesestandards shallbeeffective asvoluntary national standards ofUkraine.
Acknowledging theneedforharmonization ofeffective lawsofUkraine withinternational and
European ones, Cabinet ofMinisters ofUkraine passed on19March 1997 (based onthematerials
prepared bytheDerzhstandard ofUkraine withparticipation ofallinterested ministries andagencies)
Resolution No.244"Onmeasures relating todirect implementation inUkraine ofrequirements set
forth indirectives oftheEuropean Union, sanitary, ecology, veterinary, phytosanitary requirements
andinternational andEuropean standards"; theresolution introduced theprinciple ofprogram planning,
inaccordance withwhich there shallbedeveloped setsofregulating documents thatareharmonized
withEuropean standards inrespective sectors oftheeconomy. Theproposed measures specify planned
implementation dates forlegislative andregulative documents (seeWT/ACC/UKR/44) andtherefore
thedocument canbeconsidered asharmonization schedule.
Sanitary andPhytosanitary Measures
Question 36
Hygiene Certificate: Intheanswer toquestion 51inUKR/25/Add.l, Ukraine states thatwhen
aproduct isimported intoUkraine forthefirsttimeitisgiven a"hygienic resolution after an
obligatory State sanitary-hygienic examination andchecking ofsafety indices ofthesanitary
certificates given byforeign services."
Does thismean thatacertification ofhygiene ismade after inspection?
Answer:
Yes.Thehygienic conclusion foraproduct imported forthefirsttimeshallbeprovided afterthe
statesanitary andhygiene expertise. Ifsuchproduct isnotfurther subject tothemandatory certification,
thenwhen imported intoUkraine thehygiene expertise ofseparate consignments ofsuchproduct shall
beconducted andapermission onitssaleinaspecific region provided bythesanitary and
epidemiological service. Ifconsignments oftheproduct areliable tothemandatory certification the
permission shallbegranted onthebasisofthehygiene conclusion onatypeofproduct andavailability
ofthecertificate ofcorrespondence issued bytheUkrSEPRO system.
Question 37
What procedures arerequired toobtain thishygiene certificate, what criteria arcapplied, and
howlongdoestheprocess normally take, e.g..what isatypical period? Wewould beinterested
inreviewing anyrelevant regulations oradministrative guidance onthisrequirement.
Answer:
Thehygiene conclusion foraproduct imported forthefirsttimeshallbeprovided bytheMain
StateSanitary Doctor ofUkraine (Kiev, theMinistry ofHealth Protection (MOZ) ofUkraine). The
hygiene conclusion fortheconsignments ofgoods thatarenotsubject tothemandatory certification
shallbeissued bytheMain State Sanitary Doctors oftheRepublic ofCrimea, districts andcities of
KievandSevastopol. Thisprocess usually takes 5-7working days.WT/ACC/UKR/41
Page17
Question 38
Istheissuance ofthehygiene certificate required onlyonceforeachproduct?
Answer:
Thehygiene conclusion foraproduct imported forthefirsttimeshallbeprovided foratermfrom
onetothree years andshallbefurther extended provided thatanother sanitary andhygiene expertise
ofthedocuments accompanying theproduct provided bytheproducer (importer) isconducted and
some indices oftheproduct safety forthehealth ofconsumers areverified.
Question 39
Isthehygiene certificate required fortheproducts ofeachnewsupplier, evenIftheUkraine has
previously imported thesame products from other sources?
Answer:
Yes.Butanewsupplier mayhaveacopyofthehygiene certificate forsuchproduct which was
earlier imported, certified bytheproducer ofthisproduct subject toprior provision ofthehygiene
conclusion totheproducer andifitsvalidity period hasnotyetexpired.
Question 40
After products areimported once andreceive thehygiene certificate, aresubsequent imports
allowed toenter Ukraine without inspection ?
Answer:
After obtaining thehygiene conclusion onatypeofproduct, certification orthesanitary andhygiene
expertise ofseparate consignments oftheproduct shallbeconducted andthepermission forthesale
ofthisproduct inthespecific regions shallbeissued. (Seeanswer toquestion 37.)
Question 41
What criteria areused todetermine whether aproduct is"new" tothemarket (rather thana
variation ofproducts thathavepreviously beenimported)? Wewould beinterested inreviewing
anyrelevant regulations oradministrative guidance.
Answer:
Newproduce shallbetheproduce imported intoUkraine forthefirsttime(thehygiene conclusion
hasnotbeenprovided before, thesimilar produce fromanewproducer, newsupplier (without avalid
copy ofthehygiene conclusion granted totheproducer earlier), similar produce ofamodified
composition ormodified technology.
Question 42
Arethere established procedures bywhich theUkraine may recognize itstrading partners '
conformity assessment procedures, sanitary orphytosanitary certifications, ordeclarations of
conformance? Wewould beinterested inreviewing therelevant regulations
Answer:
Suchvaluation procedure isscheduled tobeworked outduring 1997. Presently, suchaprocedure
isbeing implemented through thebilateral negotiations, acquaintance withtherelevant legislation and
thequality assurance andproduct safety system ofthetrading partner, sanitary verification ofconditions
ofproduction.WT/ACC/UKR/41
Page18
Question 43
Does theUkraine have acomprehensive andauthoritative listofpests anddiseases forwhich
quarantine controls areimposed onimported products?
Answer:
Yes.Ukraine hassuchalist.
Question 44
Wewould beinterested inreviewing suchalist,oranypartial listswhich maybeavailable.
Answer:
Seetheinformation onsanitary andphytosanitary measures inUkraine. (WT/ACC/UKR/44)
Question 45
What criteria doestheUkraine apply indetermining thequarantine significance ofpests and
diseases? Aresuchcriteria based onguidelines established byrelevant international organizations
(i.e.Codex, ICCP, OIEandothers)? Areallpests anddiseases subject toquarantine control at
theborder alsosubject todomestic controls? Wewould beinterested inreviewing anyrelevant
regulations oradministrative guidance.
Answer:
Ukraine usesthecriteria based ontheleading mentioned documents andother international
organizations. Thequarantine control shallbeexercised atborder.
Question 46
Could Ukraine provide uswithageneral description onhowSPSmeasures areapplied inUkraine.
Itwould alsobeinteresting ifanupdated listoftheregulations applied inthisfieldcould be
provided.
Answer:
Sanitary andphytosanitary measures areenforced andapplied inUkraine inaccordance withthe
LawofUkraine OnEnsuring theSanitary andEpidemiological Safety ofthePopulation onallstages
ofdevelopment, introduction, production, import andexport, transportation, sale,application (use,
consumption)ofproducts,andprocessingthereof,utilizationordestruction(wherenecessary).Concrete
regulations andrulesarelaidoutinabout 2,000 normative andinstruction-methodical documents, many
ofwhich weredeveloped during theFormer Soviet Union times. Today themostimportant ofthem
havebeenrevised taking intoaccount theneedinharmonization withtheEuropean legislation and
areissued bytheMinistry ofHealth Protection ofUkraine asasetofdocuments (volume I-IV). See
alsotheinformation onsanitary andphytosanitary measures inUkraine.
Question 47
Inanswer toquestion 164(WT/ACC/UKR/1), Ukraine saidthatitwasnotaMember ofFAO
ortheCodex Alimentarius Commission, butthatitintended toaccede toFAOin1995. HasUkraine
finally acceded toFAO? Doyouhave theintention ofacceding totheCodex Alimentarius
Commission?WT/ACC/UKR/41
Page19
Answer:
ThequestiononUkraine’smembershipinFAOandintheCodeAlimentariusCommissioniscurrently
being worked outbytheMinistry ofForeign Affairs, theMinistry ofHealth Protection ofUkraine
andbyother departments concerned. Theaccession totheCode’sCommittee onfoodadditions, export
andimport control, andcertification, hygiene ofproduce, methods ofanalysis, pesticides residues,
veterinary preparations inproducts isexpected inthenearfuture
Question 48
Wewould alsoliketoknow whether Ukraine isplanning toratify theInternational Plant Protection
Convention, signed inRome on6December 1951.
Answer:
Thisquestion iswithin theterms ofreference oftheMFA ofUkraine. Importing, testing,
transportation, preservation, sale,application ofherbicides andpesticides inUkraine iscarried out
incompliance withtheLawofUkraine OnPesticides andAgrochemicals which hasbeendeveloped
with account taken ofthebasic provisions oftheConvention onPlant Protection
(Rome, 6December 1951).
Question 49
What standards orguidelines arebeing taking intoaccount when adopting Ukrainian measures?
Answer:
Ukraine, before itbecomes amember oftheWTO, isgoverned, firstofall,byallnational sanitary
andphytosanitary legislation, ifotherwise provided forbyanInternational agreement towhich Ukraine
isaparty. Provisions ofinternational lawsorinternational standards arealways taken intoconsideration.
Thepriority isgiven tothose provisions which ensure more safety ofproducts forhealth.
2. Export Regulation, including Subsidies
Question 50
Hasthemechanism ofreimbursing theVAT forenterprises-exporters from theaccount ofthe
State budget been improved sofar?
Answer:
Before theLawofUkraine OntheValue Added Taxcomes intoeffect on1October 1997, the
VAT reimbursement iscarried outinaccordance withtheInstruction OntheProcedure ofCalculation
andPayment oftheValue Added TaxandExcise Duty forGoods Imported intothecustoms territory
ofUkraine, andforgoods (works, services) exported fromthecustoms territory Ukraine adopted by
theOrder oftheChief State TaxInspection ofUkraine dated 31May1994 No.44andtheletter of
theMinistry ofFinance ofUkraine dated 17September 1996No.09-07-20-70-1508 ontheprocedure
oftheVAT reimbursement from theState Budget.
Thenewprocedure oftheVAT reimbursement wasadopted bythejointOrder oftheState Tax
Administration ofUkraine andtheChief State Treasury dated 2July1997 No.209/72 (below) and
shallcome intoeffect along withtheentry intoforce oftheLawofUkraine dated 3April 1997 No.
168/97-VR OntheValue Added Tax.WT/ACC/UKR/41
Page20
PROCEDURE OFTHE VALUE ADDED TAX REIMBURSEMENT
1.Pursuant tosub-paragraph 7.7.3 ofpara.7.7 oftheLawofUkraine OntheValue Added Taxin
casewhen upon theresults ofthereporting period thedifference between thetotalamount oftax
obligations thathavearisen inconnection withanysaleofgoods (works, services) during thereporting
period, andtheamount oftaxcredit during thereporting period hasanegative balance, suchamount
shallbereimbursed tothetaxpayer fromtheState Budget ofUkraine within amonth, following the
reporting period, i.e.notlaterthanthelastdayofthemonth, during which thetaxdeclaration was
submitted.
Incasethetaxpayer failstomeetthetermofsubmission ofthetaxdeclaration, setoutinsub-para.
7.7.2 para. 7.7ofArticle 7oftheLawofUkraine OntheValue Added Tax,thebudget reimbursement
shallbeextended foratermofdelay inreporting.
2.Thedataofthetaxdeclaration forareporting period shallbethesolebasisforobtaining thebudget
reimbursement.
3.Atthetaxpayer’schoice, anamount ofbudget reimbursement maybeinfullorpartially included
bythetaxbodies inthefurther payments ofthistax.Suchdecision ofthetaxpayer shallbereflected
inthetaxdeclaration.Reimbursementbymeansofthedecreaseofothertaxpayments,dues(compulsory
payments) shallnotbeallowed.
4.Budget reimbursement tothetaxpayer shallbecarried outbytheterritorial bodies oftheState
Treasury based ontheconclusions (attachment 1)ofthestatetaxadministrations according totheplace
ofthepayer’sregistration bytransferring theappropriate monetary sums from theaccount No.100
Income oftheState Budget ofUkraine tothetaxpayer’saccount inaservicing bank.
5.Theconclusion ofthetaxbody shallconstitute thegrounds forreimbursement. Thefulltermof
thepreparationandsubmissionofconclusionsis5daysfromthedateofregistrationofthetaxdeclaration
inthetaxbodies. Given theconditions ofoperation ofARM Derzhdokhody (automated working place)
theform shallbereleased automatically.
6.Therecords onconclusions provided forthepayers shallbemaintained intheJournal ofconclusions
granted ontheamounts oftheVAT reimbursement (attachment 2).
7.Thereimbursement ofamounts tothepayer shallbecarried outattheplace ofregistration according
totheVAT taxpayments totheState Budget ofUkraine pursuant torelevant section, paragraph and
symbol ofthebankreports forthecurrent day.Incaseoftheabsence orlackofrevenues onthecurrent
day,funds shallbereturned attheexpense ofthetotalrevenues onthewhole totheaccount No.100
Income oftheState Budget ofUkraine. Negative balance isacceptable under theappropriate VAT
symbol.
8.Incases ofinsufficiency orlackoffunds ontheaccount No.100 Income oftheState Budget of
Ukraine thatisopened withtheoffices oftheauthorized banks infavour oftheterritorial bodies of
theState Treasury attheplace ofpayer’sregistration, thereimbursement shallbecarried outonthe
basisofdecisions (attachment 3)ofthedepartments oftheStateTreasury intheAutonomous Republic
ofCrimea, oblasts, cityofKievandSevastopol fromthetransit account No.100, opened intheregional
department oftheNational Bank ofUkraine, attheexpense ofthetotalamount ofrevenues onthe
current day.Thegrounds fordecision making onthereimbursement fromthetransit account No.100
shallbeanaddress oftheterritorial office oftheState Treasury (attachment 4)about thenecessity
ofmaking theVAT reimbursement andacopyoftheconclusion oftaxbodies. Atthesame time,
withthepurpose ofpreventing thebudgetary debt,theterritorial office oftheStateTreasury shallensure
submission ofthetransfer order toreimburse funds tothetaxpayer totheoffice oftheauthorized
bank.WT/ACC/UKR/41
Page21
Decision onthefunds transfer fromthetransit account No.100 shallbeforwarded totheterritorial
body oftheState Treasury. Theregional department oftheNational Bank ofUkraine shall, onthe
basis ofthetransfer order ofthedepartment oftheState Treasury oftheAutonomous Republic of
Crimea, oblasts, cities ofKievandSevastopol, transfer funds fromthetransit account No.100 tothe
account No.100 oftheterritorial bodyoftheStateTreasury. When funds arereceived ontheappropriate
symbol oftheaccount No.100 theoffice ofanauthorized bank shallimmediately fulfil thetransfer
order oftheterritorial treasury office astotheVAT reimbursement tothetaxpayer.
9.Thetaxpayer which usesaquarterly taxperiod andcarries outexport transaction onselling goods
(works, services), mayobtain budget reimbursement ofthepartofataxcredit based ontheresults
ofoperations during thefirstmonth ofthequarter andtwofirstmonths ofthequarter. Thepercent
ofthetaxable credit oftheaccounting period thatequals thepercent ofexport volumes ofthesaleof
goods (works, services) inthetotalvolume oftaxable transactions onthesaleofgoods (works, services)
oftheaccounting period shallbesubject tobudget reimbursement. Thegrounds forthereimbursement
shallbethesettlement (attachment 1totheTaxDeclaration ontheValue Added Taxadopted bythe
order oftheStateTaxAdministration ofUkraine of30May1997 No.166) which issubmitted tothe
statetaxadministration bodynotlaterthanthe20thofthesecond orthirdmonth ofthecurrent quarter.
Reimbursement shallbecarried outinorder provided forinthesub-paragraph 7.7.3 ofparagraph 7.7
ofArticle 7oftheOntheValue Added Taxforataxable (reporting) period thatequals thecalendar
month.
10. Theamounts which havenotbeenreimbursed tothetaxpayer within thetermsetout
inparagraph ofthisprocedure shallbedeemed budget debt. Theinterest onthelevel120percent
ofthediscount rateoftheNational Bank ofUkraine totheamount ofbudget debtshallbeaccrued
onaspecial payer’saccount, which asrequested bythetaxpayer maybetransferred orincluded at
thecostoffurther payments orafineforuntimely settlements withthebudget.
11. Upon obtaining therecords onrevenues bythetaxbodies fromthebodies oftheState
Treasury which havebeentransferred totheStateBudget ofUkraine, andcopies ofpayment documents
onthereimbursement oftheVAT tax,theamount oftheVAT which issubject toreimbursement,
shallbedecreased inthecardofapersonal account ofthepayer totheamount offunds mentioned
inacopyofthepayment document.
Question 51
Thesuggestion appears tobethatinthefuture Ukraine tends tointroduce asystem under 'which
theGovernment would intervene inthemarket tosupport farm prices. CanUkraine explain in
greater detail what isplanned inthisarea, which weviewwithsome concern. HowdoesUkraine
intend thatthiswould beaccomplished within thedomestic support commitments thatitwill
undertake.
Answer:
TheMinistry ofAgroindustrial Complex plans tosubmit aproposal totheCabinet ofMinisters
ofUkraine about thecreation oftheState Intervention Grain Market Stabilization Fund.
Themain goals ofthestatefundactivity shallbe:
-toensure gradual transition totheself-regulated foodgrain market under conditions ofelimination
ofthestateorder system;
-toensure foodsecurity ofthestatebyusing thestateorders forfoodgrain;
-tosupport domestic grain producers byguaranteeing thestable levelofprices.WT/ACC/UKR/41
Page22
IV. OTHER POLICIES RELATED TOFOREIGN TRADE
2. Agricultural Policies
Export Stimulation Measures, including Subsidies
Question 52
This isanimportant issue which needs tobefurther explored. Weexpect Ukraine tobase
commitments onthemostrecent three yearperiod andifnoexport subsidies wereprovided during
thisperiod thencommitments should bebound atzero. Wealsoexpect thatUkraine willnot
introduce export subsidies between nowandtheendoftheaccession process.
Answer:
Seetheexplanatory Notetothenewversion ofWT/ACC/4 Format Tables calculated for1994-1996,
which were senttoWTO Secretariat on3July1997 (WT/ACC/SPEC/UKR/1/Rev.2).
Question 53
Could youprovide uswith detailed information onthemonetary value ofthe"green box"
measures(column 3ofsupporting table DS:1)?
Answer:
Information onmonetary costofGreen Boxmeasures iscontained intheauxiliary tableDS:1 which
wasforwarded toWTO Secretariat intheletter of3July1997.
Question 54
Could wehave anexplanation onhow thesupport ofselection instock breeding
operates?(Re: "general services" No.1) .
Answer:
Support forselection intheraising oflive-stock isprovided bywayofpartial compensation ofcosts
ofpedigree cattle breeding associations, selection centers, pedigree cattle breeding farms, statepedigree
poultry farms, pedigree enterprises andother owners ofpedigree enterprises aimed atimprovement
ofgenetic potential oflive-stock andpoultry, usedforreproduction ofthemostvaluable sirebreeds,
creation oftheownselection system andpedigree basis, raising ofpedigree andordinary horse-breeding
andbio-technological methods ofanimal andpoultry reproduction, preservation ofthegenetic fund
oflocalandwildspecies. 50percentofthecostofpurchased pedigree animals, poultry, sperm, embryo
shallbereimbursed totheagricultural producers from thestatebudget.
Question 55
Could wehave anexplanation onhowthesupport forthelaunching ofproduction inthe
agricultural machinery sector operates and ontherelevant "green box" justification?
(Re:"general services" No.2)
Answer:
Inthelast version ofthetable DS:1 sent toWTO Secretariat on3July1997
(WT/ACC/SPEC/UKR/1/Rev.2) thissupporting measure isexcluded.WT/ACC/UKR/41
Page23
Question 56
Could youprovide uswithmore information onhowtheeligibility procedure andthebasis to
getpayments fortheimprovement oflandaremade?(Re: "general services" No.5).
Answer:
TheStatesupport totheagricultural producers through thebasic improvement oflandisprovided
bywayofreimbursement oftheirexpenditures forconducting works onliming ofacidandgypsum
ofsaltysoils. Thesaidworks areconducted onthebasisofconclusions andcostestimates ofthestations
onchemical treatment ofland.
Question 57
Could youprovide uswithinformation onhowthesupport forselection instock breeding (support
ofimplementation ofnewhighly -productive varieties) operates?
Answer:
Seeanswer toquestion 54.
Question 58
Could youprovide uswithinformation onhowthe"public stockholding forfoodsecurity purposes
"isbeingimplemented?CouldyouspecifyhowemergencysituationsarecharacterizedbyUkrainian
legislation?
Answer:
Such termaspublic allocation ofshares isnotinuse. Thesecond partofthequestion needs
clarification -themeaning isnotclear.
Question 59
Could youdescribe howthe"regional assistance programs" operate? Could youidentify theareas
thatwere benefited bythose programs?
Answer:
TheLawofUkraine "OntheStatus ofMountain Settlements inUkraine" provides forsubsidies
foragricultural producers thatarelocated intheterritory defined asthemountainous zone. However,
duetothelackoffunds inthestatebudget thismeasure ofsupport isnotcurrently applied.
Question 60
InDS:1, under "others", Ukraine saysthattheLaw"oncollective agricultural enterprises" and
"onpeasant 'sfamily farming" provides forthe"payment ofpartofbanking interest onloans"
andforthe"payment forapartoffirsttractor, combine orautomobile purchased". Wewould
appreciate iftheUkrainian government could provide uswithmore information onthisprogram
andonitsjustification according to"green box" criteria.
Answer:
TheLawofUkraine"OnCollectiveAgriculturalEnterprisesandOnPeasants’(Farmers’)Economies"
provide forthestate support forcollective agricultural enterprises andfarms bywayofpartial
compensation oftheirexpenditures oninterest payments under bankloans.WT/ACC/UKR/41
Page24
Partialcompensationofexpendituresontheacquisitionofthefirsttractor,combine,lorryisprovided
tothose farms which purchase them forthefirsttimeanddonothavetheappropriate machinery
available.
Question 61
Re:WT/ACC/UKR/25/Add.1.Couldyouprovideuswithmoreinformationonthe"ExportPotential
Development Program" mentioned intheanswer toquestion 74?What arethemain features?
What arethemonetary outlays envisaged? How isitgoing tobefinanced?
Answer:
Tosettheexport-import balance, reduce negative balance offoreign trade, create appropriate
conditionsforincreasingexportofgoods(works,services)thedraftoftheStateProgramonDevelopment
ofExport Potential ofUkraine hasbeendeveloped andsubmitted forconsideration totheCabinet of
Ministers ofUkraine, which provides asfollows:
-toincrease theshare ofhi-tech products uptotherelevant ratioexisting inthedeveloped countries;
-encouragement ofexport ofproducts ofhighprocessing level;
-improvement ofcrediting oftheexport-oriented industries;
-introduction ofinsurance forexport transaction;
-encouragement offoreign investments intheexport-oriented enterprises;
-appropriate modernization ofindustrial facilities;
-support fordomestic producers andlegalprotection oftheirinterests, withthegenerally accepted
commercial norms andpractices being applied.
However, atthepresent timetheprojected funds fortheexport support arenotallocated bythe
Government, theprogram isnotimplemented, overall export ofthecountry, andagricultural produce,
inparticular, aredecreasing.
Question 62
Weexpect thatdomestic support andexport subsidy commitments willbebased onthemostrecent
three yearperiod (aspartofthestandstill concept inaccession negotiations) andthatUkraine
willnotintroduce export subsidies between nowandtheendoftheaccession process. Ifnoexport
subsidies wereusedduring themostrecent three yearperiod thenexport subsidies should bebound
atzero.
Wenotethatgreenboxtables(supportingtableDS:1)remainthesameexceptformoreinformation
provided inthedatasources column. Ukraine hasincluded under (1)other "partial reimbursement
ofagricultural producers" expenses onpayment ofinterest under banking loans, initsgreen box
tables. Thiswould more appropriately beincluded asamber box(non- product-specific AMS)
Wenotethatthetable "production ofcertain types ofproducts inUkraine" hasonlyprovided
details forbeef, pork, bird'smeat. granulated sugar, butter, sunflower oilandclean wool. We
would appreciate details ontheproduction levels ofpotatoes, flaxfibre, hop, tobacco and
vegetables.
Ukraine states inthefootnote totable "Extra charges andadditional payments forthesold
agricultural products tothepurchasing organization" thatfrom 1995theGovernment eliminated
price support toagricultural producers. Inviewofsupporting table DS:5 onmarket price support,
canUkraine elaborate onwhat price support itcurrently hasandonwhat products.WT/ACC/UKR/41
Page25
Weseekclarification thattheimport andexport oftheproducts listed inthetable "Sale ofcertain
types ofproducts bythepublic enterprises ofUkraine" (potato, flaxfibre, hop, tobacco and
vegetables) arecontinued byslatetrading enterprises.
Ukraine confirmed inparagraph 6oftheexplanatory notes thatitdoesnotapply anydirect export
subsidies. However, theimplication ofparagraph 4appears tobethat, because world prices arc
higher thantheprevailing domestic price, Ukraine hasdetermined thedifference amounts toa
levelofexport subsidy.
Weseekclarification astowhether Ukraine, byproviding thetable "Export ofcertain products
from Ukraine in1990-96", isclaiming anyexport assubsidised.
Answer:
Seetheexplanatory Notetothenewversion ofWT/ACC/4 Format Tables calculated for1994-1996,
which were senttoWTO Secretariat on3July1997 (WT/ACC/SPEC/UKR/1/Rev.2).
State Trading (Agriculture )
Question 63
Could yougiveusmore information about Ukraine 'splans tosetupan"Intervention Agency"
thatwould supposedly dealwithagriculture trade?
Answer:
Nointermediary agency wasandisplanned toestablish. Market-based structures arebeing set
upinthecountry, agricultural exchanges, trade houses etc.,through which thetrade inagricultural
produce isconducted.
Question 64
Wecontinue toseekfurther details onState trading.
Answer:
Inaccordance withDecrees ofthePresident ofUkraine "OnCommercialization oftheStateTrade
andPublic Catering", "OnMeasures Regarding Acceleration ofSmall Privatization Process inUkraine"
andtheUkrainianLaw"OnPrivatizationofSmallStateEnterprises"privatizationandcommercialization
oftrade andpublic catering havebeenconducted inUkraine.
More that9percentoftradeandpublic catering enterprises havechanged theirtypeofownership
asof1September 1997. Non-state sector provides more thaneighty (80)percentofretail tradereturn.
With commercialization oftrade, administrative andcommand system ofmanagement hasbeen
completely liquidated andcentralized distribution ofgoods under thefunds hasbeencancelled.
Ifensuring thestateneeds inagricultural produce through theexchange market ismeant, theCabinet
ofMinisters ofUkraine adopted theresolution "OntheConcept ofDevelopment oftheExchange Market
ofAgriculturalProduce"(No.848,dated5August1997)whichforeseesthatthevolumesofprocurement
ofagricultural produce forthestateneeds should beformed onlythrough thenetwork ofagricultural
exchanges.WT/ACC/UKR/41
Page26
9.Policies Concerning Intellectual Property Rights (TRIPS )
Question 65
Inseveral areas ofintellectual property protection, such asgeographical indications, patents,
border enforcement, layout designs ofintegrated circuits, undisclosed information, theUkrainian
Government hasstated thatdraft laws arebeing discussed. Thesame applies forpossible
amendments tothecriminal code. Information isneeded onthestate ofplayofthese draft laws
aswellasofanyother (already existing orforeseen) legislative action which could haveimplications
fortheprotection ofintellectual property rights (including aconcrete timetable forthecompletion
oftherespective legislative processes andacopyofthelaw,preferably inEnglish andifalready
available).
Answer:
TheState Agency ofUkraine forCopyrights andRelated Rights haselaborated thedraftLawof
Ukraine "OnIntroduction ofChanges andAmendments totheCriminal Code ofUkraine", which
provides forthefollowing wording ofArticle 136oftheCriminal Code:
Article 136.Infringement upon Copyrights andRelated Rights
Unlawful useofproducts andobjects ofrelated rights, thatistheirreproduction and
distribution without permission ofpersons holding copyrights andrelated rights, orother unlawful
appropriation ofcopyright inproducts, aswellasimportation intoUkraine without permission of
persons holding copyrights andrelated rights, ofsamples ofproducts andsoundtracks, iftheseacts
resulted inserious material damages, shallbepunished bycorrecting labour fortheperiod ofup
totwoyears, orafineinamount offiftytoonehundred andtwenty non-taxed minimum incomes
ofindividuals.
Same actsexecuted forthesecond time, orbyanorganized group, shallbepunished
byimprisonment fortheperiod oftwotofiveyears withconfiscation ofproperty, orwithout such
confiscation.
Note: material damage shallbeconsidered serious iftheamount ofsuchdamage exceeds
100ormore non-taxed minimum incomes ofindividuals.
ThedraftofthisLawhasbeenapproved bytheMinistries ofEconomy, Finance andHome Affairs,
Prosecutor General ’sOffice, Supreme Court ofUkraine, andafterapproval bytheMinistry ofJustice
itwillbesubmittedtotheCabinetofMinistersforfurtherconsiderationbytheSupremeRadaofUkraine.
Besides, thedraftLawofUkraine "OnIntroduction ofChanges andAmendments totheLawof
Ukraine OnCopyrights andRelated Rights" hasbeenelaborated andapproved byrelevant ministries
andinstitutions. Article 43ofthisdraftprovides forapplication ofpreliminary measures incases on
infringement upon copyrights andrelated rights, namely:
1. Before acaseisactually considered inacourt, thecourtorthejudge mayindependently
takeadecision toprohibit toadefendant oraperson reasonably suspected ofinfringing upon
copyrights andrelated rights, toexercise certain activities (manufacturing, reproduction, sale,rent,
importation etc.,use(within thescope ofthisLaw), aswellastransportation, storage orholding
forthepurpose ofreleasing copies ofproducts orsoundtracks suspected ofbeing counterfeit).WT/ACC/UKR/41
Page27
Acourt orajudge maytakeadecision toimpose sequestration on,orwithdraw all
copies ofproducts andsoundtracks suspected ofbeing counterfeit, aswellasmaterials andequipment
formanufacturing andreproduction thereof.
2. When sufficient information isavailable about theoffense forwhich thelawprovides
forcriminal punishment, aninvestigation institution oracourt must takemeasures tosatisfy the
existing orpossible civilclaim bywayofsearch andsequestration of:
(i) copies ofproducts andsoundtracks suspected ofbeing counterfeit;
(ii) materials andequipment formanufacturing andreproduction ofsuchproducts and
soundtracks;
(iii) documents, invoices orother articles which maybetheproof ofactsforwhich the
effective lawprescribes criminal responsibility.»
Inthenearest future, thedraftofthisLawwillbesubmitted totheCabinet ofMinisters forfurther
consideration bytheSupreme Rada.
ThedraftLaw"OnAccession ofUkraine totheGeneva (1971) Convention onProtection ofInterests
ofSoundtrack Producers fromUnlawful Reproduction ofTheir Soundtracks" hasbeenprepared, and
presently itisbeing considered byministries andinstitutions.
TheSupreme Rada ofUkraine isatthemoment considering draftLaw‘ofUkraine "OnProtection
ofRights inTopologies ofIntegrated Chips" and"OnProtection ofRights toSpecify Geographical
Origin ofGoods (Services)".
Draft Laws ofUkraine providing forintroduction ofchanges andamendments tothepackage of
Laws ofUkraine onprotection ofrights ininventions, useful models, industrial samples andsigns for
goods andservices havebeenprepared forapproval byministries andinstitutions.
Draft LawofUkraine "OnIntroduction ofChanges andAmendments totheLawofUkraine On
Protection ofRights inSorts ofPlants" hasbeensubmitted totheCabinet ofMinisters ofUkraine.
Itisplanned for1998tocomplete theelaboration ofdraftlawsonspecial border measures applied
togoods containing intellectual property objects, onprotection ofrights inbrand-names andinformation
subject tonon-disclosure, aswellastodraftprovisions ofrelevant articles oftheAdministrative, Civil
andCriminal Codes ofUkraine withrespect toprotection ofrights inindustrial property objects and
non-traditional intellectual property objects.
Unfortunately, theprocedure ofpreparation andadoption bytheSupreme Rada ofdraftlawsis
rather complicated andlong. Therefore, atthemoment itisimpossible todetermine thetimewhen
theabove draftlawswillenter intoforce.
Translations oftheabove-mentioned draftlawsintoEnglish oranyother language havenotbeen
made.
Question 66
Tohelpassess thelevelofprotection forplant varieties theUkrainian Government should provide
acopyoftheLawontheProtection ofRights ofPlant Varieties (No3116-XII of21April 1993,
inEnglish, French orGerman, ifpossible).WT/ACC/UKR/41
Page28
Answer:
Ukraine isready tosubmit acopyoftheLaws ofUkraine "OnProtection ofPlant Variety Rights",
enforced bytheResolution oftheSupreme RadaofUkraine of21April 1993No.3117-XII, translated
intoEnglish. (WT/ACC/UKR/44)
Draft LawofUkraine "OnIntroduction ofChanges andAmendments totheLawofUkraine On
Protection ofRights inSorts ofPlants" hasbeenelaborated andsubmitted totheCabinet ofMinisters
ofUkraine.
Question 67
State ofplayofanylegislative action which could haveimplications fortheprotection ofintellectual
property rights (including aconcrete timetable forthecompletion oftherespective legislative
processes andacopy ofthedraft law,preferably inEnglish, French orGerman, ifalready
available).
Answer:
Reply iscontained inreplies toquestions 65and66.
Question 68
Applied penalties incases ofinfringement ofintellectual property rights.
Answer:
TheeffectiveLawofUkraine"OnCopyrightsandRelatedRights"providesthatprotectionofpersonal
andproprietary rights ofpersons whoowncopyrights andrelated rights, maybeexercised according
toprocedures setforth byadministrative, civilandcriminal law.Article 43oftheLawprovides for
thefollowing methods ofprotection ofcopyrights andrelated rights bymeans ofcivillaw:
1. Incaseofuseofother person ’sproduct, without anagreement withtheperson who
owns copyright andrelated rights, aswellasincaseofviolation ofconditions ofuseofproducts
andobjects ofrelated rights, orviolation ofpersonal andproprietary rights, persons whoown
copyrights andrelated rights mayfileaclaim withacourt oflawofacourtofarbitration forrenewal
ofinfringed rights bywayofmaking relevant corrections, publications inthepress about the
infringement orotherwise.
2. Acourt oflaworacourt ofarbitration hastherighttoadopt adecision toapprove
orprohibit therelease ofaproduct, orbroadcasting ofaperformance, soundtrack orprogram on
theairorthrough wires, tosuspend theirdistribution, towithdraw orconfiscate allcopies ofthe
product orsoundtrack, aswellasequipment andmaterials formanufacturing andreproduction
thereof, provided thereexists sufficient information about theinfringement uponthecopyright and
related rights.
3. Acourt oflaworacourt ofarbitration mayadopt adecision todestroy orexpropriate
allcopies oftheproducts orsoundtrack which areproven tohavebeenmanufactured anddistributed
withviolation ofexisting rights ofpersons whoowncopyrights orrelated rights. Thisrelates to
allclichés, matrixes, forms, originals, magnetic tapes, photographic negatives andother articles
usedtoreproduce copies ofaproduct, soundtrack, broadcasting programs, aswellastomaterials
andequipment usedforreproduction thereof.
ThisLaw(Article44)alsoprovidesforreimbursementfordamagesforinfringementuponcopyrights
andrelated rights.WT/ACC/UKR/41
Page29
1. Persons whoowncopyrights andrelated rights mayclaim:
(i) reimbursementfordamagescausedbyinfringementuponcopyrightsandrelated
rights, including profit notreceived;
(ii) withdrawal andtransfer infavour ofowners ofcopyrights andrelated rights,
ofoffender ’sprofits received frominfringement uponcopyrights andrelated
rights -asasubstitute forreimbursement fordamages;
(iii) payment ofcompensation tobedetermined byacourtinamount of10to50,000
non-taxed minimum incomes ofindividuals setforth bythelawofUkraine,
asasubstitute forreimbursement fordamages orwithdrawal ofprofits.
2. Besides reimbursement fordamages andwithdrawal ofprofits, forinfringement upon
copyrights orrelated rights, acourt oflaworacourt ofarbitration shallimpose afineinamount
of10percentofthesumwhich thecourt hasruled topayinfavour oftheplaintiff. Fines so
collected shallbetransferred torelevant statebudgets according toaprocedure setforth bythe
law.
3. Offender ofcopyrights andrelated rights shallalsoreimburse moral damage inamount
determined byacourt topersons whoownthese copyrights andrelated rights.
Asregards criminal responsibility, itisnecessary tooutline thatincompliance withArticle 136
oftheCriminal Code ofUkraine currently inforce, infringement upon copyrights andrelated rights
ispunished byafineorcorrecting labour, which, ofcourse, doesnotmeetinternational requirements.
Therefore, changes arenecessary inthisArticle -please refertoreply 65.
Theeffective lawofUkraine provides forthefollowing punishments forinfringement uponrights
in:
(i)industrial property objects:
-Article 164-3 ofthe"Code ofUkraine onAdministrative Offenses" provides forimposition ofa
finetogether withconfiscation ofproduce manufactured, production tools andrawmaterials, or
without suchconfiscation, forunlawful useofbrand-name, signs forgoods andservices orany
marking ofgoods, aswellasforunlawful copying ofshape, packing orexternal design, and
imitation, copying ordirect reproduction ofgoods manufactured byanother producer, andfor
unauthorized useofhisname;
-Article 7oftheLaw ofUkraine "OnRestriction ofMonopolism andPrevention ofUnfair
Competition inBusiness" provides forimposition ofafinebytheAnti-Monopoly Committee of
Ukraine forexecution ofactswhich areconsidered unfair competition, inparticular, unlawful use
ofbrand-name,signsforgoodsandservicesoranymarkingofgoods,aswellasforunlawfulcopying
ofshape, packing orexternal design, andimitation, copying ordirect reproduction ofgoods
manufactured byanother producer, andforunauthorized useofhisname;
-Articles 4,5,and6oftheLawofUkraine "OnProtection fromUnfair Competition" provide for
imposition ofpenalties andconfiscation ofgoods bytheAnti-Monopoly Committee ofUkraine
forunlawful useofother companies ’signs, packing, andcopying ofexternal design ofgoods;
-Article 137oftheCriminal Code ofUkraine provides forpunishment intheform ofcorrection
labour orfineforunlawful appropriation ofcopyrights inother persons ’inventions, useful modelsWT/ACC/UKR/41
Page30
orindustrial samples, orfordisclosure, without thepermission oftheauthor, ofthecontents of
aninvention, useful model orindustrial sample prior totheirofficial publication;
(ii)commercial secret:
-Article 164-3 ofthe"Code ofUkraine onAdministrative Offenses" provides forimposition ofa
fineforappropriation, useanddisclosure ofcommercial secret andconfidential information for
thepurpose ofcausing damage tobusiness reputation orproperty ofanother businessmen;
-Article 7oftheLawofUkraine "OnRestriction ofMonopolism andPrevention ofUnfair
Competition inBusiness" provides forimposition ofafinebytheAnti-Monopoly Committee of
Ukraine forexecution ofactswhich areconsidered unfair competition, inparticular, appropriation,
useanddisclosure ofcommercial secret andconfidential information forthepurpose ofcausing
damage tobusiness reputation orproperty ofanother businessmen;
-Articles 4,5and6oftheLawofUkraine "OnProtection from Unfair Competition" provide for
imposition offinesbytheAnti-Monopoly Committee ofUkraine forunlawful gathering, disclosure
andforcing somebody elsetodisclose commercial secret, aswellasforunlawful useofcommercial
secret;
-Articles 148-6 and148-7 oftheCriminal Code ofUkraine provide forimprisonment orafinefor
unlawful gathering, forthepurpose ofuse,andforuseofdatacontaining commercial secret, as
wellasfordisclosure ofcommercial secret.
Question 69
Clarification isneeded onwhether andhowwell-known marks areprotected incases ofgoods
orservices which arenotsimilar tothose inrespect ofwhich atrademark isregistered (Article 16.3
oftheTRIPS Agreement).
Answer:
Incompliance withtheLawofUkraine "OnProtection ofRights inSigns forGoods andServices"
(Article 3andClause 6ofArticle 6),inUkraine protected arewell-known signs forgoods andservices
onthebasis ofinternational treaties membered byUkraine, inparticular, onthebasis oftheParis
Convention onProtection ofIndustrial Property (Article 6bis).
ThedraftLawofUkraine "OnIntroduction ofChanges andAmendments totheLawofUkraine
OnProtection ofRights inGoods andServices" incorporates provisions ofArticles 15-21 oftheTRIPs
Agreement concerning trademarks, including well-known trademarks.
Question 70
What isthenature andscope ofprotection ofcomputer software anddatabanks, aswellasrelated
rights? (SeeAnnex totheAgreement, Article 3,Clause 1).
Answer:
LawofUkraine "OnCopyright andRelated Rights" which provides forprotection ofliterary works,
computer programs anddatabases, hasbeeneffective since February 1994. Under thislaw,authors
ofsuchworks, aswellastheirlegalsuccessors, haveboth‘title’(non-property, or"personal") and
"ownership" (property) rights totheirworks. Thepersonal rights include theauthor ’srighttodemand
recognition ofhisbeing theauthor, mentioning ofhisname incases where hiswork isbeing used,
ifit’spracticable, theright topublicize hiswork, andprevent anyunauthorized changes toorWT/ACC/UKR/41
Page31
misinterpretations ofhiswork. Theproperty rights include theauthor ’sexclusive righttouseone’s
works inanyform orinanyway, authorize orprohibit distribution ofone’sworks, theirlease, as
wellasrequire acompensation foranyuseofhisworks.
Thepersonal andproperty rights toone’sworks canbeenforced through procedures established
under applicable administrative, civilandcriminal laws.
Issues relating totherelated rights aregoverned byprovisions ofTitleIIIofthespecified above
Law, which setouttherights ofperformers, producers ofphonograms andbroadcasting organizations,
criteria forgranting protection, andterms ofsuchprotection, ofrelated rights.
Itshould benoted thatLawofUkraine OnCopyright andRelated Rights hasbeenreviewed by
International Department oftheWorld Intellectual Property Organization andmeets therequirements
setbyBernConvention onProtection ofLiterary andArtistic Works. Ukraine wasgranted membership
inBernConvention on25October 1995.
Question 71
When isUkraine going tojointheInternational Agreement onProtection ofArtists, Musical
Instruments Makers andOrganization ofRadio Broadcasting of26October 1961; orinwhat
another manner isUkraine going tofulfil itsobligations under theAnnex totheAgreement,
Article 2,Section 1,Clause 3?
Answer:
On31May1995Verkhovna Rada(Parliament) ofUkraine passed LawofUkraine "OnAccession
ofUkraine toBernConvention onProtection ofLiterary andArtistic Works", which tookeffect on
25October 1995. Presently therearebeing prepared forsubmission toParliament thedocuments that
arerelated toUkraine ’saccession toGeneva (1971) Convention onprotection ofphonogram producers
from illegal reproduction oftheirphonograms.
AstoUkraine ’sjoining Rome (1961) convention forprotection oftherights ofperformers,
phonogram producers andbroadcasting organizations, itisplanned thatitwillbeaccomplished within
thefirsthalfof1998.
Question 72
What realpossibilities exist fortheowner ofsaidrights toprotect himself from determined
counterfeit? (Article 3,Clause 2)?
Answer:
Inaccordance withtheLawofUkraine OnProtection ofGoods andServices andTrademark Rights
anowner oftherights toatradeorservices mark shallbeabletoprotect hismark fromcounterfeiting
bywayofthestateregistration ofatrade orservices mark andobtaining acertificate confirming the
rightofownership tothemark.
Under Article 16ofthesaidLawthecertificate foramark shallgrant itsowner anexclusive right
touseanddispose themark athissolediscretion, andforbid theuseoftheregistered mark bythe
other persons without hisconsent.
Article 20ofthisLawprovides thatanyencroachment upontherights ofthecertificate owner shall
bedeemed asinfringement ofhisrights andinvolves responsibility under current LawofUkraine.
Upon theowner ’srequest suchinfringement mustbestopped andtheviolator shallbeunder obligationWT/ACC/UKR/41
Page32
toindemnify thelosses incurred bythecertificate owner. Theowner ofthecertificate mayalsorequest
thattheillegally usedmark orasign, which issimilar tothemark inasmuch astoleadtoconfusion,
should beremoved from thegoods oritspacking.
Provision regarding enforcement oftheowner ’srights tothemarkfromcounterfeiting areembodied
inArticle 7oftheLawofUkraine "OnRestriction ofMonopolies andPrevention from Unfair
Competition inEntrepreneurial Activity" which determines thatillegal useofatrade name, mark for
goods orservices, oranyother marking ofgoods, andillegal copying oftheform, packing, external
design, imitation, copying, direct reproduction ofgoods ofother businessman, arbitrary useofhis
name shallconstitute thefactofunfair competition.
Itisrecognized inArticle 4oftheLawofUkraine "OnPrevention From Unfair Competition" that
theuseofsomebody else’sname, trade name, marks forgoods andservices, goods packing, names
ofplaces oforigin ofgoods which mayresult inconfusion withtheactivities ofother economic agent
(businessman) which hasthepriority intheiruse,without permission oftheauthorized person, shall
bedeemed illegal.
Making actions determined bytheLaws ofUkraine "OnRestriction ofMonopolies andPrevention
fromUnfair Competition inEntrepreneurial Activity" and"OnPrevention From Unfair Competition"
asunfair competition andshallresult inimposition offinesbytheAnti-monopoly Committee ofUkraine
andadministrative, civilandcriminal responsibility incases provided forbyLaw.
Question 73
What measures wereundertaken byUkraine lastyears forimprovement ofenforcement ofrights
innon-material values (Article 5oftheAnnex totheAgreement)?
Answer:
Withthepurpose ofharmonizing thelegislation ofUkraine inthefieldofprotection ofintellectual
property withprovisions oftheTRIPS Agreement regarding enforcement ofrights totheobjects of
intellectual (including industrial) property thefollowing measures havebeentaken recently:
-in1996 thedraftLaws ofUkraine OnEnforcement ofRights toLayout Designs (Topographies)
ofIntegrated Circuits andOnEnforcement ofRights toGeographical Indications ofGoods (Services)
inaccordance withprovision ofArticles 35-38 and22-24 oftheTRIPS Agreement weredeveloped
andsubmitted toSupreme Rada ofUkraine;
-in1997thedraftLaws ofUkraine onintroduction ofchanges inandamendments tocurrent Laws
ofUkraine OnEnforcement ofRights toInventions andUtility Models, OnEnforcement ofRights
toIndustrial Samples, OnProtection ofGoods andServices andTrademark Rights, OnProtection
ofRights toPlant Varieties havebeendeveloped. Theabove changes andamendments provide,
inparticular, forintroduction ofclauses onprovisional measures inthesaidlawstoimmediately
stopinfringement ofrights totheobjects ofindustrial property incompliance withrequirements
ofArticle 50oftheTRIPS Agreement;
-in1997 thedevelopment ofproposals astobringing theprovisions oftheCivil, Criminal and
Administrative Codes ofUkraine toconformity withtherequirements ofArticles 41-50, 61was
initiated;
-in1997 theconcept ofthelegislative actregarding thespecial measures onthecustoms border
ofUkraine inorder toprevent crossing ofthecustoms border ofUkraine bycounterfeit goods and
goods withfalsified trademark incompliance withtherequirements ofArticles 51-60 wasdeveloped;WT/ACC/UKR/41
Page33
-in1996 theprovision onactivity oftheAppellate Council oftheState Patent Office ofUkraine
asthebody which resolves attheadministrative levelthedisputes related tothegranting ofrights
toindustrial property objects wasimproved;
-theconceptual basisregarding thecreation ofaspecialized branch ofjudicial system (patent court)
fordispute settlement inthefieldofintellectual property isbeing developed.
Asithasalready beenpointed out,Ukraine hasjoined Bernconvention forprotection ofliterary
andartistic works, inthenearfuture Parliament willreceive necessary materials relating toUkraine ’s
accession toGeneva convention forprotection ofphonogram producers from unlawful reproduction
oftheirphonograms.
Besides, there havealready beenapproved byrelating ministries andagencies andsubmitted for
finalapproval toJustice Ministry thedraftlawsonintroducing changes andadditions totheCriminal
CodeofUkraine andtheCode ofUkraine onAdministrative Infringements, which provide fortightening
criminal andadministrative accountability forviolating copyright andrelated rights. Itisbeenproposed
tointroduce suchsanctions asimprisonment, seizure ofproperty, unlawfully produced copies of
copyrighted works andequipment usedfortheirreproduction, aswellasimposition ofsizable fines.
Presently Parliament isreviewing thedraftLawOnIntroducing Changes andAdditions totheLaw
ofUkraine "OnCopyright andRelated Rights", which, inparticular, provides forbefore-the-court
measures aimed atstopping violations ofcopyright andrelated rights, inaccordance withwhich judge
mayrule,solely onhisowninitiative andbefore thecaseisreviewed incourt, toprohibit thedefendant ’s
carrying oncertain activities provided thatthereisevidence substantiating thattherespondent violates
copyright andrelated rights, orthejudge mayorder toseizeallunlawful copies andphonograms, as
wellasmaterials andequipment usedtoproduce such.
Question 74
When isUkraine going tojointheHague Agreement (Stockholm edition of1967) onInternational
Preservation ofCraftsmanship Samples andModels (Article 5oftheAnnex totheAgreement)?
Answer:
UkrainehasanintentiontograduallyaccedetoallagreementsadministeredbytheWorldIntellectual
Property Organization, firstofall,totheagreements participation inwhich isprovided forinthebi-
ormultilateral agreements thathavealready entered intoforce intheterritory ofUkraine. Thisalso
includestheaccessiontotheHagueAgreementonInternationalDepositofIndustrialSamples(Stockholm
Act1967). Ukraine isplanning toaccede totheabove Agreement in1998.
Question 75
When isUkraine going tojointheBudapest Agreement onInternational Recognition ofProtection
ofMicroorganisms (1977) (Article 5oftheAnnex totheAgreement)?
Answer:
Ukraine became aparty tothesaidAgreement on2July1997.
Question 76
IsUkraine going tojointheProtocol of27June 1989totheMadrid Agreement onInternational
Registration ofMarks (Labels)?WT/ACC/UKR/41
Page34
Answer:
Ukraine hasanintention togradually accede toallagreements administered bytheWorld Intellectual
Property Organization, firstofall,totheagreements participation inwhich isprovided forinthebilateral
ormultilateral agreements thathavealready entered intoforce intheterritory ofUkraine. Thisalso
includes theaccession totheProtocol of27June1989 totheMadrid Agreement ontheInternational
Registration ofMarks. Ukraine plans toaccede toabove Protocol in1998.
V. TRADE AGREEMENTS
2. Regional Integration
Question 77
Could wehavemore information onthemultilateral agreement onindustrial cooperation relating
totheAshkabad Agreement?
Answer:
General provisions
AlltheCIScountries signed theAgreement ongeneral conditions andsupport mechanism ofthe
development ofproduction cooperation ofenterprises andindustries oftheCIScountries on
23December 1993 inthecityofAshkabad withtheaimofthere-establishment anddevelopment of
mutually beneficial co-operation tiesbetween enterprises andindustries oftheCIScountries. This
Agreement isbased ontheprinciples ofstatesupport ofco-operation ties,encouragement ofbusiness
activity entities todevelop co-operation firstofallbymeans ofsimultaneous mutual exemption ofthe
goods shipped under production co-operation agreements fromimport andexport dues, taxes, excises
andquantitative restriction.
Theparties agreed thatshipment under production co-operation agreement meant shipment ofraw
materials, parts, components, spare parts, half-finished products andother products ofindustry and
inter-industry consumption technically related toandnecessary forjointproduction offinished products.
Rendering ofservices under aproduction co-operation agreement means fulfilment ofdesign and
repairs works, technical maintenance andtechnological operations.
Shipment (rendering ofservices) iscarried outbymeans ofconclusion ofagreements (contracts)
between thebusiness activity entities onthebasis ofinter-departmental agreements.
TheAshkabad Agreement ’smechanism ofrealisation wasdeterment bythecorresponding Protocol
signedon15April1994bythegovernmentsoftheCIScountries.TheProtocolprovidedfortheadoption
ofunified regulations bytheparticipating countries.
With theaimoffullutilisation ofadvantages andpeculiarities ofbilateral inter-state relations in
technological andscientific areas, re-establishment anddevelopment ofinter-dependable manufacturing
enterprises,preservationandfurtherdevelopmentofspecialisationinthemanufacturingindustriesUkraine
hasalsoconcluded bilateral agreements onproduction co-operation with Azerbaijan, Georgia,
Turkmenistan,Kazakstan,UzbekistanandtheKyrgyzRepublicfromwhichagreementswithAzerbaijan,
Georgia, Turkmenistan andUzbekistan hasentered intoforce.
State oftheregulatory baseofUkraine andtheCIScountriesWT/ACC/UKR/41
Page35
TheResolution oftheCabinet ofMinisters ofUkraine no.323of18May1994 (with future
amendments) enacted theRegulations ontheprocedure ofshipment andcustom clearing ofproducts
under production co-operation ofenterprises andindustries oftheCIScountries thatdetermined the
mechanism ofrealisation oftheAgreement ’sprovisions inUkraine andMinistries andDepartments
responsible forthepreparation andconclusion ofinter-departmental agreements forseparate branches
ofindustry.
Theprocedureofmovementofgoodsandproductsshippedunderproductionco-operationagreements
across thecustom border ofUkraine hasbeenestablished bytheRegulations ontheprocedure of
movement across thecustom border ofUkraine andregistration ofproduct shipped under inter-
departmentalagreementsonproductionco-operationapprovedbytheOrderoftheStateCustomsService
ofUkraine no.189of25April 1997.
NormativedocumentsenactingtheAgreementhasalsobeenapprovedinRussia,Azerbaijan,Georgia,
Armenia, Belarus, Moldova, Kazakstan, theKyrgyz Republic andTadjikistan.
ProcedureofgrantingVATandexcisepreferenceswhenconductingreciprocalshipmentsofproducts
under production co-operation agreements between countries parties totheAgreement isdetermined
intheRegulations ontheprocedure oftheapplication oftheVAT andexcise taxes toshipments of
goods (services) under production co-operation agreements insettlements between business activity
entities oftheCIScountries adopted bytheHeads ofGovernments oftheCIScountries on
17January 1997. Butthementioned Regulations havenotyetbeenenacted byRussia -themajor partner
ofUkraine inproduction co-operation.WT/ACC/UKR/41
Page36
ANNEX 1
THE LIST OFDOCUMENTS TOBESUBMITTED WITH THE DECLARATION FORM
(i)Documents toconfirm thefactofexport:
acontract, aninvoice, transport documents.
(ii) Documents toconfirm theorigin ofgoods:
forproducer: areference onthegoods manufacturing* process
foranintermediary: documents onthegoods procurement (contracts, transport, ifavailable, payment
documents, etc.)toconfirm theproducer (certificate ofquality, passports, labelling ongoods or
tare).WT/ACC/UKR/41
Page37
ANNEX 2
DECLARATION FORM
Thecustomer enterprise .............................................
being anexporter, requests thecertificate(s) oforigin for........................
Quantity ofgoods ...........,weight ..............................
number ofitems ............,typeoftransport .......................
Theproducts isdelivered totheaddress ...................................
under contract No. ...........of..................................
from .........................................................
transport documents ..........
Documents submitted when certificate ismade up:
.............................................................
Thegoods aremanufactured bytheenterprise: ..............................
Thecustomer declares thatthedatamentioned above isaccurate, thegoods originate from Ukraine
andmeettherequirements astotheorigin ofgoods.
Head ofEnterprise
______________________/signature/
(seal)