RESTRICTEDWORLD TRADE
ORGANIZATIONWT/ACC/SPEC/ARM/1/Rev.7
12 June 2002
(02-3265)
Working Party on the
Accession of Armenia
DRAFT REPORT OF THE WORKING PARTY
ON THE ACCESSION OF ARMENIA
Revision
I. Introduction1. At its meeting on 17 December 1993, the Council of Representatives established a Working
Party to examine the application of the Government of Armenia to accede to the General Agreementon Tariffs and Trade (GATT 1947) under Article XXXIII, and to submit to the Councilrecommendations which might include a draft Protoc ol of Accession.  In a communication dated 31
January 1995 (WT/L/25), the Government of Armenia applied for accession to the Agreement
Establishing the World Trade Organization (WTO) pursuant to Article XII of the WTO Agreement.Following Armenia's application and having regard to the Decision adopted by the General Councilon 31 January 1995 (WT/GC/M/1),  the Working Party on the Accession of Armenia to the GATT1947 was transformed into a WTO Accession Working Party.  The terms of reference of the WorkingParty were also contained in document WT/L/25.
2. The Working Party met on 24 January and 23-24 September 1996, 14 May 1997 [and ...]
under the Chairmanship of H.E. Mr. D. Kenyon (Australia).
Information
3. The Working Party had before it, to serve as a basis for its discussions, a Memorandum on the
Foreign Trade Regime of Armeni a (WT/ACC/ARM/1), and the questions submitted by Members on
the Armenian foreign trade regime together with  the replies of the Armenian authorities thereto
(WT/ACC/ARM/2 and Corr.1;  WT/ACC/ARM/5 ;  and WT/ACC/ARM/8).  In addition the
representative of Armenian made available to the Working Party the following material:WT/ACC/SPEC/ARM/1/Rev.7
Page 2
- The Customs Code of the Repub lic of Armenia of 1 January 2001;
- Decree of the Government of the Republic of  Armenia No. 40 of 13 February 1993, "Additional
Measures on State Regulation of International Economic Activities";
- Resolution No. 31 of 21 February 1995, "On Regulation Regarding the Establishment,
Registration, Licence and Suspension of Activitie s of Banks and Their Branches and Agencies
and Those of Foreign Banks Operating in the Republic of Armenia”
- Law on Amendments and Additions to the Republic of Armenia Law on the "Value-Added
Tax" of 10 December 1994;
- Law of the Republic of Armenia on Property Tax;
- Law on Making Amendments in the Republic of Armenia Law on Excise Tax of
30 November 1994;
- Law on Pledge Collateral;
- Law on Bankruptcy of Enterprises and Individual Entrepreneurs of 15 June 1995;- Law on Making Amendments in the Republic of Armenia Law on Corporation Tax of
19 December 1994;
- Law on Standardization of 9 December 1999;
- Law on Conformity Asse ssment of 9 December 1999;
- Law on Patents of 21 August 1993;- Law on Income Tax of 8 February 1995;
- Law on Land Tax of 27 April 1994;
- Law on State Agrarian Inspections;
- Statute of the Peasant and Collective Peasant Farms of 22 January 1991;
- The Land Code of 29 January 1991;- Supreme Council Resolution on the Maximum Sizes of  the Land Lots in Property of the Peasant
and Peasant Collective Farms;
- Resolution No. 581 of 16 December 1994, “On Corr oboration of the Temporary Regulations for
Auditing Activities in the Republic of Armenia”;
- Government Decision of 17 January 1995, "On the Procedure of Granting Licenses for
Importation and Exportation of Goods (Works , Services) in the Republic of Armenia";
- Government Resolution No. 67 of 8 February 1995, "On the State Procurement Order of 1995
of the Republic of Armenia";
- Government Resolution No. 4 of 19 August 1995, "On Confirmation of the Temporary
Regulations for Trademarks and Service Marks";
- Government Resolution No. 606 of 29 Decemb er 1994, "On Rates of the Excise Tax";
- Government Resolution No. 88 of 23 February 1994, "On the Order of Submitting Statistical
Reports Regarding the Importation and Exportation of Services in the Republic of Armenia";
- Council of Ministers Resolution No. 161 of 5 Ma rch 1991, "On the Order of Exercising Diverse
Types of Economic Activities on the Territory of the Republic of Armenia";
- Decree of the Government of the Republic  of Armenia No. 124 of 29 December 1995 On
Non-Tariff Regulation of the Commodities (Operations, Services) Import and Export in theRepublic of Armenia;
- Statement of the Central Bank of the Republic of Armenia on Joining to Article VIII of the IMF
Agreement.;
- The Law of the Republic of  Armenia of 30 June 1996, "On Central Bank of Armenia";
- The Law of the Republic of Armenia of 30 June 1996, "On Banks and Banking";
- The Law of the Republic of Armenia of  10 June 1996, "On Bankruptcy of Banks";
- Decree of the Government of the Republic of Armenia No. 124 of 29 December 1995, "On
Non-Tariff Regulation of the Commodities (Operations, Services) Import and Export in the
Republic of Armenia";
- Amendments to the Law, "On Privatization a nd Denationalization of State-Owned Enterprises
and Unfinished Construction Sites";
- List 2 of the Resolution of the Government  of the Republic of Armenia No. 415 of 1995,"On
types of Activities that are Subject to Licensing in the Territory of the Republic of Armenia";WT/ACC/SPEC/ARM/1/Rev.7
Page 3
- Statute of the Ministry of Economy of the Republic of Armenia of 20 June 1996, "On Issuing
Inferences on Minimal Pricing of Exports of Pr oducts from Ferrous and Non-ferrous Metals not
Produced in Armenia, as well as their Scrap";
- Statute of the Ministry of Health of the Republic of Armenia of 20 June 1996, "On Issuing
Inferences on Import and Export of Pharmaceutical s into and from the Republic of Armenia";
- Statute of the Ministry of Environment Protection and Mineral Resources of the Republic of
Armenia of 20 June 1996, "On Issuing Inferen ces on Export of Wild Animals and Plants
Included in the Red Book (Endangered Species  Listing) of the Republic of Armenia";
- Statute of the Ministry of Agriculture and Food of the Republic of Armenia of 20 June 1996 On
Issuing Inferences on Import of Plant Protec tion Agents into the Republic of Armenia.
- Decree of the Ministry of Health of the Republ ic of Armenia, "On Regulation of Pharmaceutical
Activity and Ensuring the Quality of Drugs and Medical Facilities";
- Programme of the Government of the Republic  of Armenia, "On Privatization of State
Enterprises and Unfinished Construction sites of the Republic of Armenia for 1996-1997";  and
- Amendment of 1 May 1996 to Annex N 1 to Decree of the Government of the Republic of
Armenia No. 615 of 6 December 1993, "On Determining the Customs Duties";
- Law of the Republic of Armenia "O n Customs Duties" of 30 December 1998;
- Law of the Republic of Armenia "On Cu stoms User Fees of 30 December 1998;
- Decree of the Government of Armenia "To Define the Rules for Determining the Country of
Origin of Goods";
- Civil Code of the Republic of Armenia of 5 May 1998;
- Civil Procedure Code of 20 January 1998;
- Criminal Procedure Code of 20 January 1998;
- Law of the Republic of Armenia "On Trade Names" of 12 May 1997;
- Law of the Republic of Armenia "On Trade and Service Marks and Appellations of Origin of
Goods";
- Patent Law of 21 August 1993;
- Law of the Republic of Armenia "On Copyri ght and Neighbouring Rights" of 27 May 1996;
- Draft Law of the Republic of Armenia "Protection of Secret Information";
- Draft Law of the Republic of Armenia "On Protection of Selection Achievements";
- Law of the Republic of Armenia "On Lega l Protection of Topographies of Integrated
Circuits" of 3 February 1998;
- Draft Proposals on the Amendments in the Armenian Law on Patents Dealing with the
Provisions of the WTO Component Agreement TRIPS;
- Regulation "On Importation of Goods Subject to Certification in the Republic of Armenia into
the Customs Territory of the Republic of Armenia" of 16 January 1998;
- Decree No. 15 of the Government of the Repub lic of Armenia "On Compulsory Certification
of Goods and Services in the Republic of Armenia" of 16 January 1998;
- Regulation "On Application of Certificate of Compliance when Realising and Advertising
(Rendering Services) the Certified Goods Subject to Compulsory Certification in the Republicof Armenia" of 16 January 1998;
- Regulation "On Fees for the Compulsory Certification in the Republic of Armenia" of
16 January 1998;
- Decree No. 171 of the Republic of Armenia "O n Establishment of Agrarian Regulations" of
11 March 1998;
- List of Toxic and Biological Means Permitted for the Use in the Republic of Armenia to
Struggle Against Pests, Diseases and Weeds of Agricultural Cultivated Plants, Forestry and
Ornamental Plants;
- List of Quarantine Pests, Diseases of Pl ants and Weeds for the Republic of Armenia;
- List of Quarantine Plants, Food, Seeds and Seedlings of Plant Origin for Quarantine
Protection Purposes;
- Law of the Republic of Armenia "On Ag rarian State Inspections" of 15 May 1996;
- Regulation "On Cooperation Between the Customs Authorities, Border Veterinary Inspection
Stations and State Plant Quarantine Services of the Republic of Armenia" of 27 January 1998;WT/ACC/SPEC/ARM/1/Rev.7
Page 4
- Law of the Republic of Armenia  "On Plant Protection and Plant Quarantine" of 20 March
2000;
- Law of the Republic of Armenia "On Veterinary" of 26 October 1999;
- Government Decree No. 26 of the Republic of Armenia "On the Measures to Ensure the
Implementation of the Separate Articles of the Laws of the Republic of Armenia on
"Standardization and Certification"  and the "Uniformity of Measures" of 20 January 1998;
- Decree of the Government of Armenia No. 26 "Procedure on the Implementation of State
Metrology Control Over the Quantity of Withdrawn Commodities" 20 January 1998;
- Government Decree No. 29 of 11 January 2000 on Preparation, Adoption and Application of
Technical Regulations;
- Law on Taxes, adopted by the National Assembly of the Republic of Armenia, on 14 April
1997;
- Law on Excise Tax effective 1 August 2000;
- Law on Simplified Tax effective 5 June 2000;
- Government Decree No. 913 of 31 December 2000;
- Law on Amendment to the Customs Code of the Republic of Armenia of 26 December 2000;
- Draft Law on Land Tax;
- Draft Law on Antidumping and Countervailing Measures;
- Draft Law on State Registration of Legal Persons;
- Law on Medicines;
- Law on Licensing (May 30, 2001);
- Law on State Registration of Legal Entities (April 26, 2001);
- Resolution 239 of 12 May 2000, with amendments
- Government Resolution 581 of 20 September 2000; and
- Draft Law on Making Amendments and Additions to the Customs Code.
Introductory statements
4. In an introductory statement, the representative of Armenia said that since declaring
independence from the former Soviet Union in 1 991, Armenia had vigorously pursued free market
reforms within a democratic framework, notwithstanding acute political and economic difficulties.Economic decline had been reflected in sharp reductions in output, falling incomes, reduced tradeflows, severe shortages of energy, and scarcity of food and other consumer goods.  Despite thisadversity, the Government had persevered with the economic reform programme, placing particularemphasis on liberalization, stabilization, and economic restructuring.  Most agricultural land wasprivatized shortly after independence and privatization in other sectors was moving ahead.Demonopolization and deregulation had removed barriers to private sector participation in all but afew areas of economic activity.  Price controls were only applied to a limited number of essential
goods and services, and were being phased out.  Foreign investment was encouraged.
5. He further added that on the macroeconomic side, stabilization policy was a government
priority, given the challenge of the difficult budgetary position, combined with the need to containinflationary pressures and maintain exchange ra te stability.  The Government had successfully
brought monthly inflation down to a single digit level, from the triple-digit levels prevailing at the endof 1993.  By the end of 1997 the annual inflation was 21.9 per cent, and annual inflation for 1998 2.9WT/ACC/SPEC/ARM/1/Rev.7
Page 5
per cent, for year 1999 6 per cent, for year 2000 0.8 per cent and for year 2001 2.9 per cent.  The
Government was strongly committed to securing a sound and stable macroeconomic framework forfuture economic growth and development.  Fuller integration into the world economy, and continuingdiversification of Armenia's economic relations with other countries, were central planks of theGovernment's reform efforts.  The Government of Armenia believed that these objectives could onlybe attained through open trade policies that emphasized specialization on the basis of internationalcomparative advantage.  It was for this reason that the Government of Armenia attached priority to its
accession to the World Trade Organization, and wished to complete negotiations for membership at
the earliest opportunity.
6. The Working Party welcomed Armenia's application for accession to the Agreement
Establishing the WTO.  Several members of the Working Party acknowledged that Armenia hadundergone a rapid process concerning reform and trade liberalization which, notwithstanding internaland external difficulties, appeared to be succeeding in permitting economic growth.  These membersexpressed support for Armenia's integration into the multilateral trading system and indicated theirreadiness to pursue the negotiations in earnest.
II. ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE
- Foreign exchange and payments
7. In response to questions from members of the Working Party concerning Armenia’s foreign
exchange reserves and the convertibility of the Dram, the representative of Armenia stated that grossofficial reserves made up US$ 330 million by the end of 2000 and covered about 4 months of imports.
Gross official reserves had risen from 0.7 months of import cover in 1994 to 2.3 months in 1996, 2.7months in 1997 and 3 months in 1998.  On 29 Ma y 1997, Armenia had accepted Article VIII of the
International Monetary Fund's Agreement and the obligations implied by Sections 2, 3 and 4 thereofand had committed to refrain from imposing restrictions on carrying out payments and transfers, andfrom engaging in discriminatory currency arrangements or multiple currency practices without IMF
approval. According to  Resolution No. 141 "On Foreign Exchange Regulation and Administration of
Control", there were no restrictions on current account operations. After being licensed by the CentralBank natural persons and legal entities were allowed to act as foreign exchange dealers. The CentralBank of Armenia (CBA) determined the daily exch ange rate as a midpoint of the previous day’s
buying and selling operations in foreign exchange market (the participants of foreign exchange marketare those dealing with over-the-counter market, stock exchanges, foreign exchange bureaus, etc.).Foreign exchange dealers (including banks) were free to establish their own exchange rates fortransactions. Non-resident banks could be authorized to participate in the domestic foreign exchangeWT/ACC/SPEC/ARM/1/Rev.7
Page 6
market on conditions equal to those set for resident banks. Legal entities and natural persons, residents
and non-residents of Armenia could open and hold their current accounts in foreign banks without anyrestrictions.  Residents of Armenia could undertake   movement of capital without any restrictions
unless otherwise specified by CBA. Non-residents could undertake the  movement of capitalaccording to the "Law on Foreign Investments" of the Republic of Armenia.  All bilateral clearingarrangements based on barter had been eliminated.
-I n c o m e  T a x
8. The representative of Armenia stated that according to the Law on Income Tax, which entered
into force on 1 January 1998, personal income tax was determined on the basis of the amount of thetaxpayer’s income earned during the reporting period. In determining the taxable income the
following deductions could be made from a gross income: deductible income, personal deductions,and expenses. Gross income was deducted by Dram 20,000 for each month during which an incomewas earned.  The income tax rates were as follows:
Monthly taxable income Amount of income tax
Less than Dram 80,000 10 per cent of total income
More than Dram 80,000 Dram 8,000 added to 20 per cent of total income
exceeding Dram 80,000
Annual taxable income Amount of income tax
Less than Dram 960,000 10 per cent of total income
More than Dram 960,000 Dram 96,000 added to 20 per cent of total  income
exceeding Dram 960,000
He further added that the rate of income tax for in come received from royalties, payments of interest
and property rent was 10 per cent.  The following categories of receipts were exempt income for taxconsiderations: social security allowances under Armenian legislation, lump-sum allowances tofamilies of military servicemen killed or handicapped, alimony payments, earnings of individuals fordonations of  blood and pectoral milk or for other type of donor activities, as well as income from
agricultural activities.
- Land Tax
9. The representative of Armenia stated, that a  land tax was imposed on private landowners and
users of State owned land. The land tax was calculated  as an annual fixed charge for a land plot unit.For agricultural land the land tax rate was set at 15 per cent of calculated net income determined bythe estimated fiscal value of the land, and for the land for non-agricultural usage the land tax rate wasWT/ACC/SPEC/ARM/1/Rev.7
Page 7
established at 1 per cent of the estimated fiscal l value of the land (0.5 per cent if outside residential
area). In order to promote the development of plant-raising, newly established and immature orchardsand vineyards were exempted from payment of land tax.  In the event of adverse agriculturalcircumstances,  the Government, with the consent of the National Assembly of Armenia, could  grantcertain tax exemptions to some taxpayers or to groups of taxpayers.  In a new Draft of the Law onLand Tax, which was submitted to the National Assembly of Armenia, the property character of thetax was accentuated, and tax calculation methods were  simplified. In particular, for both agricultural
and non-agricultural land plots the amount of tax would be calculated based on their value, and that
value would be determined according to the same Law.
- Profit Tax
10. The representative of Armenia stated that  the new Law on Profit Tax, which entered into
force on 1 January 1998, introduced a profit tax  on residents and non-residents.   For residents theprofit tax was charged on taxable profit earned  in Armenia and abroad. For non-residents the profittax was charged on taxable profit earned from Armenian sources.  For residents the amount of profittax charged on taxable profit was determined at a rated of 20 per cent.  The following types ofrevenues were included in Armenian taxable income of non-residents from Armenian :
- income derived from entrepreneurial activities within Armenian territory;
- passive income earned  by non-residents from residents or non-residents; and
- other income obtained by non-residents within the Armenian territory.
The tax charged on income obtained by non-residents from the Armenian sources was levied
according to the following rates:
Type of Income: Profit tax rate
Interest 0 per cent
Insurance offsets received as a result of insurance; payments received for reinsurance,
incomes received from shipment (freight)5 per cent
Dividends, Royalties; income received from property rent; property value increment and
other passive income (except income received from shipment (freight)), as well as other
income received from Armenian sources10 per cent
Taxpayers engaged in the production of agricultural products were exempted from the profit tax
payments.   Since 1 January 1998, Armenian resident statutory funds with foreign investments ofgreater than 500 million Drams had been permitted to reduce their profit tax as follows:WT/ACC/SPEC/ARM/1/Rev.7
Page 8
Proportion of profit tax reductions from the tax liability of the
resident enterprise with foreign investment, allowed for the
respective yearsYear when the established investment
benchmark in the statutory fund of a
resident enterprises would be fulfilled100 per cent 50 per cent
1998 1999 and 2000 2001-2008 inclusive
1999 2000 and 2001 2002-2009 inclusive
2000 2001 and 2002 2003-2008 inclusive
2001 2002 and 2003 2004-2007 inclusive
2002 2003 and 2004 2005-2006 inclusive
2003 2004 and 2005
2004 2005 and 2006
2005 2006 and 2007
2006 2007 and 2008
2007 2008 and 2009
If the taxpayer’s ceased operations during the  period of tax reduction, the amount of the profit tax
would be calculated at the full rate for the entire period of economic activity.
- Simplified tax
11. The representative of Armenia said that ac cording to the Law on Simplified Tax, which
entered into force on 5 June 2000, simplified tax replaced VAT and Profit Tax or Income Tax (asapplicable)  for entrepreneurial activities. All entrepreneurs, whether Armenian or foreign in originwere subjected equally to the tax.  For legal persons simplified tax substituted for VAT and Profit
Tax.  For individual entrepreneurs simplified tax substituted for VAT and Income Tax.  Tax privileges
for VAT and Profit or Income Tax  had been terminated for taxpayers covered by simplified tax.  Alllegal persons and individual entrepreneurs were liable to simplified tax if during the previousreporting year the total amount of turnover of  goods supplied and services rendered had not exceededAMD 30 million (exclusive of VAT).  The tax threshold did not apply to the trade and public cateringactivities carried out in shops and counters.  He further noted that the legal persons and individualentrepreneurs to whom simplified tax applied in 2001 amounted to 0.8 per cent of GDP.   Thefollowing taxpayers were not subject to simplified tax:
- Producers of goods subject to excise tax;
- Taxpayers with outstanding liabilities (including fines and penalties envisaged by Tax
legislation) exceeding 100 thousand Drams as at 1 January of the relevant year;
- Loan and insurance companies, investment funds, specialized parties of stock market,
organizers of casinos, cash winning games or lotteries, persons carrying out audits or
consulting services, etc.;
- Presumptive taxpayers within the definition of the  law "On Presumptive Payments";
- Taxpayers holding any remaining goods goods imported under a "for free circulation"
customs regime, (non VAT taxable at the moment of import and not sold within theprevious year) the value of which exceeded 1 million Drams;WT/ACC/SPEC/ARM/1/Rev.7
Page 9
- Those entities which ceased to be considered as that prior to 31 December inclusive
of that year;
- Producers of agricultural products.
He further added that the simplified tax base was the sale turnover of goods supplied and services of
taxpayers during the reporting quarter. The tax rate for income from sales by shops and counters wasat  the following rates:
a) For the amount up to 30 million Drams – 5 per cent;
b) For the amount exceeding 30 million Drams – 7 per cent.
For any other trading activity the tax was determined on sales turnover at the following rates:
- 8 per cent for the amount under AMD 30 million;
- 13 per cent for the amount over AMD 30 million.
- Property tax
12. The representative of Armenia stated  that the property tax was a direct tax levied on all
buildings and vehicles belonging to natural and legal entities.    The calculation of the tax levied onbuildings was based on their value (determined pursuant to the  Law on Property Tax).  Taxation ofvehicles was determined based on the power output  of its engine and age of the vehicle. Buildingswere revalued  every three years.  If  the value of a residential building was less than 3 million Dram,it was exempted from property tax.  If a residential buildings had a value above 3 million Dram, the
tax rates were set according to a  scale, varying between  0.1-0.8 per cent.
13. The representative of Armenia stated that in accordance with the Law on Property Tax, the
property tax levied on buildings for public and production usage was established at 0.6 per cent oftheir value.
The property tax for motor transport vehicles was levied according to the following annual rates:
For passenger vehicles with up to ten seats:  if the tax base (engine power is):
- less than 120 horsepower/88 kilowatts:  200 Drams per horsepower/ 272
Drams per kilowatt;
- 120-250 horsepower/88-184kilowatts:  then 300 Drams for each horsepower
or 408 Drams for each kilowatt.
For passenger vehicles with over ten seats and trucks:  if the tax base (engine power) is:
- less than 200 horsepower/147kilowatts:  100 Drams for each horsepower/136
Drams per kilowatt;
- Over 200 horsepower/147kilowatts:  200 Drams per horsepower/ 272 Drams
per kilowatt.WT/ACC/SPEC/ARM/1/Rev.7
Page 10
- State ownership and privatization
14. In response to requests for information concerning the privatization of State owned assets, the
representative of Armenia stated that the process of privatization had started  in Armenia in  1991,when Government Decision No. 335 had permitted sma ll enterprises in the sphere of public utilities,
catering, trade and other services to be privatized. The Law on Privatization and Denationalization ofEnterprises and Unfinished Construction Sites, adopted in 1992, was the legal basis for all subsequentprivatization. He further added that by 1 January 2002 the Government of Armenia had adopted 2,067
decrees concerning the privatization of companies (including 170 decrees on dissolution of
enterprises).  The national Assembly of the Republic of Armenia had adopted Laws on Armenia'sPrivatization Program.
15. The representative of Armenia noted that five privatization programs adopted by the National
Assembly had been undertaken since the beginning of the privatization process in Armenia. The firsttwo privatization programs were covered the years (1994 and 1995 respectively.  They were followedby the adoption of the 1996-1997 and 1998-2000 privatization programs.  Those privatizationprograms included most companies in the fields of industry, agriculture and transport as well as all"small enterprises" (in the sphere of  public utilities, catering, trade and other services) and unfinished
construction sites.  The current Privatization Program of State Assets for the for the period 2001-2003,
was adopted by the National Assembly on 27 July 2001.  It incorporated all enterprises intended tohave been privatised under earlier programs. He further noted that foreign legal and natural personswere free to participate in the privatization of any state assets.
16. In response to further requests for information the representative of Armenia noted that up to
1 January 2002  1,643 medium and large enterprises had been privatised.  Of those 1,081 had beenprivatised through the open subscription of shares, 62 through share auctions, 134  employee buy out,102 through tenders, 20 through auctions, and 377  through direct sales, of which 200 to lessees.  Themost common form of privatisation was the open subscription of shares (65.8 per cent of privatized
entities). Thirty six  companies, the privatization of which failed, were dissolved, although a total of
367 enterprises' privatizations had failed, mainly because of high prices, poor business prospects andheavy indebtedness.
17. In response to requests for further information on the sale of privatised enterprises to
foreigners, the representative of Armenia noted that the following enterprises privatized throughinternational tenders:  "Armentel" State Enterprise, Yerevan Brandy plant, Hotel "Armenia" and Hotel"Ani" (during the privatization of which there was an international mediator).  The privatization or
transfer of the management rights of the State power, production and distribution network, "Nairit"WT/ACC/SPEC/ARM/1/Rev.7
Page 11
Scientific-Research Union, as well as "Armenian Airlines" Company was anticipated.  In the energy
sector eleven hydro-electric power stations had been already privatized, two of had been purchased byforeign persons.  The Armenian network of gas distribution was privatized, resulting in theestablishment of "ArmRusGasArd" CSC. In 2001 the strategic enterprises of "Almast" CJSC,
"Sapfire" JSC,  "Tranzistor" and "Hrazdan Cement" were privatized, one of which to a foreign entity.
18. In response to further requests for information, the representative of Armenia stated that since
1999, privatisation in Armenia had focussed on attracting of strategic investors, as well as
encouraging minority shareholdings in  privatized co mpanies.   The government continued to seek to
create new jobs and development social programs in privatized enterprises.    To achieve this  shareswere privatized by tender, the terms of which reflected other development factors as well as the price.
19. Some members of the Working Party enquired whether any sectors were excluded from
privatization.  In response, the representative of Armenia stated that according to the “Privatizationprogram for  2001-2003” enterprises of the following sectors were not subject to privatization:
- civil defence and mobilization establishments, military structures;
- minting, state decorations, seals and stamps producing enterprises;
- basic research institutions;
- institutions engaged in fundamental research investigations;
- geologic, cartographic, geodesic, hydrometeorological enterprises, enterprises
exercising control over conditions and protection of environmental and natural
resources;
- state strategic reserves and storage facilities;
- enterprises providing sanitary-epidemiological services;
- standardization and metrology services;
- railways, public highways, Yerevan metro, security services for railway and air
traffic, army motorcades;
- enterprises producing radioactive materials (and appliances for them) as well as
enterprises involved in research and constructing activities in this area;
- reformatories and corrective labour establishments;
- secondary educational institutions of the Republic of Armenia.
He further added that  units generally subject to the Privatization could  not be privatized if they are
located in:
- engineering - technical buildings, transport structure (bridges, tunnels, dams,
undergrounds and etc.) or similar areas, such as railways, social sphere units (schools,
institutes, cultural units, etc.);
- defense and security units.
He noted, however that enterprises excluded from pr ivatisation represented only  8 per cent of GDP.WT/ACC/SPEC/ARM/1/Rev.7
Page 12Table 1 (a) Privatised enterprises in the period 1994-2002
Privatized Not privatized
Type of PrivatizationTotal In 2001Industry
and TradeAgricultureUrban
Constructio
nCulture EnergyTransport &
Communi-
cationState Property
ManagementHealthInformation &
TypographyOthersIn
preparation
Process Total In 2001
Direct Sale 377 48 144 67 40 17 8 24 25 15 5 32 17 13
   o f  w h i c h  t o  l e s s e e s 2 0 01 08 12 93 01 1 7 9 1 8 12 3 3
Tender 102 21 20 24 18 9 9 15 1 6 14 136 48
A u c t i o n 2 0 1 91 0 1 41 81 0
Share Auction 62 26 27 6 1 2 3
Shares Open Subscription 1081 20 395 344 186 30 15 46 14 1 30 20 43 196 15
In Specialized Markets 1 11
New Stock Issue
T o t a l 1 6 4 39 0 5 9 4 4 7 2 2 5 04 73 28 25 41 73 75 87 8 3 6 77 3
Liquidation
Government Decision 137 26 25 29 37 - 3 6 17 8 1 11
Dissolved 49 21 12 7 6 - 1 2 15 1 - 5
In the Process of Bankruptcy 52 17 10 8 24 - 1 4 - - 1 4
Court Decision on Bankruptcy 46 25 9 7 23 - 1 4 - - 1 1
 No Court Decision on
Bankruptcy62111 - - - - - -3
Companies Dissolved 36 13 3 14 7 - 1 - 2 7 - 2
Table 1 (b)   Number of small enterprises privatized until 1999
Evaluations made Privatized 1994 – 1999 Privatized through auction Subject to sale through auction
Small enterprises 8,308 9,391 286 7WT/ACC/SPEC/ARM/1/Rev.7
Page 13Table 1 (c)  Total privatizations
Paid
(thousand Drams)
Totalof which by certificates by Drams
Medium to large enterprises 105,321,836.2 39,766,020.0 65,555,816.2
Unfinished construction site 524,912.4 176,180.0 348,732.4
Small enterprises 27,161,321.8 23,856,460.0 3,304,861.8
Total 133,008,070.4 63,798,660.0 69,209,410.4
According to the amendments in the Law on Privatization made since the year 2001, the following changes applied to the above ta ble:
1. The method of privatization through “International tender” was discontinued, since all types of prospective purchasers can pa rticipate in the tender so all types of
tenders are presented together.
2. Closed distribution of shares was one of the methods of privatization through direct sales, so the information on privatizati on via closed distribution of stocks was
included in the data on direct sales.
3. The sale of assets to the lessees was one of the methods of pr ivatization through direct sales, so the information on privati zation via sale of assets to the lessees was
included in the data on direct sales.
4. Though the Law envisages privatization thr ough share auction, it was currently out of practice by reason of its ineffectiveness.  However, taking into account the fact
that some enterprises were privatized via this method, the information was included in the table.
5. The Law on Privatization currently in force provides for privatization through the issuance of new shares.6. The dissolution of companies was now used more frequently, so it was presented in the table in more detailed form.WT/ACC/SPEC/ARM/1/Rev.7
Page 14
20. The representative of Armenia added that within Armenia there remained some  concerns
about the privatization programme, particularly in relation to  overall concept of privatization, and thedesirability of voucher versus tender. As had been the case with some other transition economies,short term gains  from privatization proved to be overstated.  A more realistic approach currently
prevailed which as oriented toward maximization of money gains from privatization.  It was clear that
many years may elapse before the privatised enterprise could become a genuinely profitable business,within which period the enterprise may change owners several times.   The representative of Armeniastated that after taking all these considerations in to account, the government had recently adopted a
more pragmatic  approach.  Currently, the main objectives of the state privatization policy were to tryand maximise cash returns from the privatisation on an enterprise in combination with appropriatemanagement reform.   
21. He further noted that this approach had lead to a recent focus on the tender method of
company privatization.  Whenever possible, enterprises were sold to strategic, long-term investors.
This in turn assisted the government's objective of job creation and continuing social improvements.
In this connection, the new Law on Privatization of State-owned Assets provided greater flexibility inprivatizing individual enterprises, with respect to the form of privatization, as well as with respect tothe terms of payment.  The Government had also begun the process of winding-up enterprisespreviously offered for privatization in respect of  which privatization had failed.  He further noted thatthe transparency of information relating to privatized enterprises was ensured, and detailedinformation on privatized enterprises was readily available in Armenia's mass media and on a specialinternet page (www.privatization.am).
22. In response to a  question concerning privatisation of agricultural land, the representative of
Armenia stated that  almost 70 per cent of agricultural land had been privatised.  Title to  all land had
been made freely transferable.  The small share of land still in State hands was reserve land and landused for certain kinds of agricultural support activities described in paragraphs 152-158 below.  Therewas no  timetable for the privatization of the agricultural land remaining  in State hands.
23. The representative of Armenia confirmed that to ensure full transparency and to keep WTO
members informed of its progress in the reform of its transforming economic and trade regime,Armenia would provide annual reports to WTO Members on developments in its programme of
privatization along the lines of the information provided to the Working Party, and on the other issuesrelated to its economic reforms as relevant to its obligations under the WTO Agreement.  The
Working Party took note of this commitment.WT/ACC/SPEC/ARM/1/Rev.7
Page 15
- Investment regime
24. The representative of Armenia stated that the 1994 Law on Foreign Investments regulated
Armenia’s  foreign investment regime.  The Law was designed to attract foreign investment andprovided guarantees against nationalization, by requiring that expropriation  only take place following
a judicial decision.  In such a case,  full compensation would be payable.  He further noted that
foreign investors were indemnified against damages resulting from illegal actions by Government, orfrom the improper actions by the Government (as determined by a Court of Law).  The Law alsoguaranteed investors the right to freely repatriate  profits and assets.  In the event that foreign
investment legislation was changed after an inve stment has occurred, the investor concerned was
entitled to an exemption from any less favourable provisions during a five-year period.  Therepresentative of Armenia further noted  that discussion of a new Investment Law had beendiscontinued.  The main reason for this was the recognition  that the existing legislation did fit thecurrent economic situation  and there was no  need for new legislation to coordinate foreign investors
activities.
25. The representative of Armenia recalled the description of the Law on Profit Tax described in
paragraphs […] above.  He further added that Decree No. 124 expressly stipulated that the unifiedsystem of export and import of goods and services was extended to all economic entities of theRepublic of Armenia, irrespective of the form of ownership and the place of registration.  Thispermitted enterprises with foreign investment to also  enjoy the benefits of certain duty-free treatment
available to domestically owned enterprises.
26. In response to further questions he further noted that foreign investors were free to choose
their own insurers.  No investment performance requirements were maintained.  There were no export
performance requirements for foreign investors.  The Government did not intend to introduce any
such requirements.   He further stated that foreign investors received full national treatment. Anyrestrictions on investment were  applied on a non-discriminatory basis between national and foreigninvestors, although the Constitution of the Republic of Armenia provided that non-citizens  did nothave the right to own land, although the the Land C ode  permitted foreign citizens, juridical persons,
other economic entities and  international organizations to  lease land on the territory of the Republicof Armenia.  The Civil Code of Armenia permitted state bodies or local self-government to decide tolease publicly owned land  or for private or collective owners to lease their land on the basis of areciprocal contract between the parties.WT/ACC/SPEC/ARM/1/Rev.7
Page 16
- Pricing policies
27. In response to requests for an update on the progress of price reform, the representative of
Armenia stated that since 1995, almost all government-mandated price controls had been removed.The only domestic prices that were still subject to regulation were those for irrigation (Government
Decree No. 240 from March 2002), urban electrical transport, electricity, hot water, gas, heating
(delegated to Energy Commission established by the Law on Energy of 7 March 2001), sewage
services, garbage collection, and telephone services (Government Decree No. 658 of 28 October 1998and Government Decree No. 717 of 26 November 1999).  Those prices were still subject to regulation
because State-owned enterprises were the exclusive or dominant suppliers, or in case of telephoneservices, the private supplier enjoyed exclusive rights on provision of services.  All administeredprices were adjusted on a regular basis to maintain their real value.
28. The representative of Armenia added that subsidies on bread, municipal electric transport and
garbage collection, and cross-subsidies on water and sewerage had been eliminated.  The subsidies on
district heating and hot water (the only remaining consumer subsidies) were under review.  In the case
of district heating, which less than one-third of households actually receive, the issue of provision oftargeted heating subsidies to vulnerable groups would be resolved as part of the overall reform ofsocial assistance.
29. The representative of Armenia confirmed that price controls on products and services in
Armenia have been eliminated with the exception of those listed in paragraphs 27 and 28 of this
Report, and that in the application of such controls, and any that are introduced or re-introduced in the
future, Armenia would  apply such measures in a WTO-consistent fashion, taking account of theinterests of exporting WTO members as provided for in Article III:9 of the GATT 1994.  He also
confirmed that the goods and services listed in paragraph 25 and 26 had been published in the
Government’s official newspaper and any products subject to State price controls in the future,including any changes in the initial list reported at the time of accession, would be published in theofficial newspaper.  The Working Party took note of these commitments.WT/ACC/SPEC/ARM/1/Rev.7
Page 17
III. FRAMEWORK FOR MAKING AND EN FORCING POLICIES AFFECTING
FOREIGN TRADE IN GOODS AND TRADE IN SERVICES
- Powers of executive, legislative and judiciar y, administration of policies on WTO-related
issues
30. The representative of Armenia said that the legislature of the Republic of Armenia was the
National Assembly, which consisted of 131 deputies.  The plenary powers of the National Assembly
terminated in June in the fourth year after its election, on the opening day of a first session of the
newly elected National Assembly when its plenar y powers commence. The members of the National
Assembly and the Government were authorized to submit Bills for approval by the NationalAssembly.  The National Assembly elected the Chairman by majority vote for the whole period of itsplenary powers.  The Chairman conducted sessions, administered material and financial resources ofthe National Assembly and ensured the performance of its ordinary activities.  Armenian Laws wereenacted  adopted by the National Assembly.  Laws entered into force upon signature by the Presidentof the Republic and following promulgation, if no other date was stipulated by the respective Law.This procedure applied to all legislative amendments and rectifications, including those relating to the
establishment or alteration of tariffs and taxes.  The President of the Republic was required to adhere
to the  Constitution, and oversaw the ordinary activities of the legislative, and all exercise of executiveand judicial powers. The President of the Republic wa s elected by popular vote every five years.  The
President issued decrees and orders, which were subject to implementation throughout the Republic ofArmenia.  These decrees and orders should not be in conflict with the Constitution and laws.
31. The representative of Armenia added that the Government carried out the executive power in
the Republic of Armenia and comprised the Prime Minister and Ministers. The President of theRepublic appointed and dismissed the Prime Minist er, as well as, upon recommendation of the Prime
Minister, appointed and dismissed the members of the Government. Resolutions of the Government
were signed by the Prime Minister, and were ratified by the President. The Prime Minister was
responsible for the day-to-day running of the Government and for the coordination of activities ofother Ministers. The Prime Minister issued resolutions, which should be signed also by the Minister,responsible for implementation, in cases, envisaged by the Order of Governmental Activities.
32. The representative of Armenia said that in conformity with the Constitution of the Republic
of Armenia, judicial powers were executed exclusively by the Courts, in accordance with theConstitution and legislation.  In administering justice, Judges were independent and answerable onlyto law. The guarantor of the independence of judicial bodies was the President of the Republic, whowas the Head of the Council of Justice.  The Minister of Justice and the Procurator General were theWT/ACC/SPEC/ARM/1/Rev.7
Page 18
Deputy Heads of the Council of Justice.  The Courts of general competence were the Courts of First
Instance, the Review Courts and the Court of Appeals.  The Constitutional Court comprised ninemembers,  five of which were appointed by the National Assembly, and another four were appointedby the President of the Republic.  The Constitutional Court adopted resolutions and verdicts.  These
resolutions were final, could not be challenged and entered into force upon promulgation.  According
to the Constitution of the Republic of Armenia, the Constitutional Court should decide on conformityof the provisions of the Agreement Establishing the WTO and of other WTO Agreements with theConstitution of the Republic of Armenia before submitting them for ratification to the NationalAssembly.  If norms, other than those provided by the laws of the Republic, were provided in theseAgreements then the norms provided in that Agr eement shall prevail.  International treaties and
agreements that contradicted the Constitution may be ratified after making a correspondingamendment to the Constitution.
33. The representative of Armenia said that according to the 1999 Civil Code of the Republic of
Armenia  (as amended on 11 September 2001),  all economic disputes (whether the parties were
natural or legal persons) should first be referred to the jurisdiction of Economic Court.  Decisionstaken by the Economic Court could be  appealed according to the procedures stipulated by Armenianlegislation.  Armenian legislation did  not contemplate any differential treatment between CIS andnon-CIS legal entities. As a result of on-going judicial and legal reforms a number of legislative actshad been developed and adopted.  In particular, economic litigation was required to be handledthrough the new Civil Procedure Code and the new Criminal Procedure Code, which entered intoforce on 1 January and 12 January 1999 respectively. In matters other than economic issue, judicialreview of administrative action could be obtained through the Courts of general competence  in the
area of intellectual property rights protection and customs issues.  The Economic Court was
authorized to review administrative decisions in all other areas covered by WTO provisions, includingrulings in antidumping, safeguard and countervailing duty investigations. The Court of First Instancewas authorised to review administrative decisions in cases where citizens are in disagreement.  Therepresentative of Armenia advised that, according to the Law on Administrative Infringements,administrative decisions could be appealed to the higher authority within the administrative body afterwhich it could be appealed to the court.
34. The representative of Armenia confirmed that from the date of accession Armenia's laws
would provide for the right of appeal of administrative rulings on matters subject to WTO provisions
to an independent tribunal in conformity with WT O provisions, including Article X:3(b) of the GATT
1994. The Working Party took note of this commitment.WT/ACC/SPEC/ARM/1/Rev.7
Page 19
35. The representative of Armenia added that as a result of the changes in the structure of the
Government a Ministry of Trade and Economic De velopment had been created.  That new Ministry
had been given  primary responsibility in most aspects of policy affecting international trade in goodsand services. The Ministry of Finance and Economy was responsible for fiscal policy, but decisions
on tariffs were made together with the Ministry of Trade and Economic Development.  The Central
Bank was responsible for monetary policy, exchange rate policy and the banking system.  TheIntellectual Property Agency within the structure of the Ministry of Trade and EconomicDevelopment was responsible for industrial pr operty protection and copyright protection.
36. The representative of Armenia confirmed that international treaties and agreements ratified by
Parliament, including the WTO Agreement, had precedence over domestic laws or other acts inArmenia.  He stated that in matters of policy affecting trade in goods and services, including subsidiesand taxation, the Central Government retained full authority.  Sub-central and Local administrativebodies have no jurisdiction or authority to establish regulations or taxes on goods and services in
Armenia independent of the central authorities in matters covered by provisions of the WTO
Agreement.  Within the framework of the process of Armenia's accession to the WTO, the obligationsassumed by the Government of the Republic of Armenia, including the WTO Agreement andArmenia’s Protocol of Accession were subject to  implementation uniformly throughout the customs
territory of the Republic of Armenia, including in regions engaging in border trade or frontier traffic"special economic zones" and other areas where special regimes for tariffs, taxes and regulations areestablished.  He further confirmed that, from the date of accession, the central government wouldeliminate or nullify measures taken by sub-central authorities in the customs territory of the Republicof Armenia that were in conflict with the WTO Agreement when those measures were brought to its
attention, without requiring affecting parties to petition through the courts.  The Working Party took
note of these commitments.
37. The representative of Armenia informed the Wo rking Party that after the signing of the WTO
Accession Protocol by the Government of Armenia, all WTO Agreements would be submitted forreview to the Constitutional Court of Armenia.   Legal conclusion of Armenia's WTO Accession
would be accomplished upon ratification of all WTO agreements by the National Assembly.  Heconfirmed that international treaties and agreements ratified by the National Assembly, includingWTO Agreements, had precedence over domestic laws or other acts in Armenia. All the laws andlegislative instruments necessary for the application of the provisions would be adopted as provided in
the Protocol of Accession and would  be in place prior to that time. The Working Party took note of
these commitments.WT/ACC/SPEC/ARM/1/Rev.7
Page 20
IV. POLICIES AFFECTING TRADE IN GOODS
- Market Access Negotiations
38. Armenia undertook negotiations on market access in goods with interested members of the
Working Party.  The Schedule of Concessions and Commitments resulting from those negotiations isin Annex I to the Appendix of the Protocol of Accession of Armenia.
- Registration requirements
- The rights of import and export (trading rights)
39. The representative of Armenia informed the Working Party that with certain exceptions
necessary to safeguard human, animal and plant health and the environment, the former Statemonopoly in foreign trade in Armenia was abolished in 1989, and was replaced by a registrationrequirement Enterprises or private entrepreneurs engaging in trading (including importation) wererequired to be registered in the State Register of Enterprises.
40. He further stated that the Decree of the President of the Republic of Armenia of 4 January
1992 entitled On Foreign Economic Activity, provided that all enterprises or branches, subsidiaries
and representations thereof that were registered and operating in the territory of Armenia, regardless
of their form of ownership, were granted the right to conduct foreign economic activity without anyadditional registration requirements. The legislation governing company incorporation andregistration consisted of:  The Law on the State Register of Legal Entities; The Armenian Civil Code,1999; The Law on Foreign Investment, 1994; The La w on State Fees, 1997. The State registration of
enterprises and private entrepreneurs in the Republic of Armenia, as well as the procedure andconditions for the use of information provided through the registration process was defined in the Lawon the State Registration of Legal Entities of 26 April 2001.  Additional provisions could be found inthe Civil Code, and for foreign investors in the Law on Foreign Investment.
41. Engaging in entrepreneurial activities without State registration was prohibited in the
Republic of Armenia.  Natural persons were permitted to import limited quantities of items intoArmenia for personal use without registration, although to engage in resale of those items registrationas a sole entrepreneur was required. No registration was required in Armenia for any enterpriseoperating from outside the territory as an exporter to Armenia.  The representative of Armenia notedthat with the entering into force of the new Law on State Registration of Legal Entities (26 April2001) a significant improvement of registration procedures had taken place.WT/ACC/SPEC/ARM/1/Rev.7
Page 21
42. He further noted that certain types of activities required a licence.  The Law on Licensing
(adopted on 30 May 2001) listed the types of activities subject to licensing.  Licenses were of thefollowing type; licenses issued by "simple" procedures;  licenses issued by "compound" procedures.A simple licence required submission of an application to receive a licence; a copy of a legal entity's
charter and a copy of a state registration certificate, a copy of the state registration certificate (for an
individual entrepreneur) and any other documents pr ovided by law.   To obtain a compound licence an
applicant had to supply documents required for a simple licence as well as documents certifying theprofessional qualification of a person (as applicable).  A simple licence was required to be issuedwithin 3 days of submission of the complete application.  A compound licence was required to beissued within 30 days, based on the conclusions of a licensing commission.
43. The State registration of legal entities and individual entrepreneurs was carried out by the
State Registry, which operated as part of the Ministry of Justice.  The State Registry consisted of aCentral Body and regional divisions.  In accordance with Article 21 of the Law on the State
Registration of Legal Entities the following documents should be submitted to the regional
subdivisions of the State Registry at the legal entity's place of location; the application of the founder;the protocol of the founders' meeting on establishment of the legal entity, (signed by the chairman andsecretary);  two copies of the charter approved by the meeting;  and a receipt for the State fee.  Legalentities with a foreign founder were also required to submit an extract from the commercialregistration book of the given country (or equivalent document confirming the legal status of theforeign investor) and founding documents (or the corresponding extracts), translated into Armenianand verified.
44. He further added that not later than five days after submitting all necessary documents, the
regional subdivision of the State Registry was required to complete the state registration of a legal
entity. The state registration of individual entrepreneurs was required within a period of two days.  Aunified system of codes of the State registration of legal entities operated in the Republic of Armenia.The Unified State Register contained information about all legal entities and individual entrepreneursregistered in the Republic of Armenia and was maintained by the Central Body of the State Registry,which updated it at least once every 10 days. The information of the Unified State Register was openfor general public access.  
45. He further noted that to obtain state registration of an amended business charter, the following
documents must be submitted to the regional subdivision of the State registry: an application; the
decision of the authorized body relating to the amendments and supplements in the charter, as well as
the approval of the restated charter with amendments and supplements; the amendments orWT/ACC/SPEC/ARM/1/Rev.7
Page 22
supplements of the charter; receipt for state fee payment.  Any changes and amendments in statutory
documents, or changes in any data entries verified by State registration, were also subject to Stateregistration.  The documents necessary for state registrations conditioned by different types ofreorganization were defined by Article 23 of the Law.
46. For the state registration of the winding-up of a legal entity the following documents shall be
submitted:  an application, the decision of the founders; references from tax and social securitybodies; a corresponding document on the return of the seal; the state registration certificate.
47. The representative of Armenia confirmed that the former State monopoly in foreign trade in
Armenia had been abolished and that no restrictions on the right of foreign and domestic individualsand enterprises to import and export goods and services within Armenia’s customs territory existed,except as provided for in WTO Agreements; that in dividuals and firms were not restricted in their
ability to import or export based on their registered scope of business; and that the criteria forregistration of companies in Armenia were generally applicable and published officially and generally
available to traders for their review. He further confirmed that from the date of accession, Armenia
would ensure that all of its laws and regulations relating to trade in goods and all fees, charges ortaxes levied on such rights would be in full conformity with its WTO obligations, including ArticlesVIII:1(a), XI:1 and III:2 and 4 of the GATT 1994 and that it would also implement such laws andregulations in full conformity with these obligations.  The Working Party took note of thesecommitments.
- Customs tariff
48. The representative of Armenia stated that the Law on Customs Tariffs, adopted by the
Parliament in August 1993, provided a legislative framework for setting tariffs and dealing with
customs matters.  Decree No. 615 issued by the Government in December 1993 introduced new
customs duties, which were further modified by Government Decree No. 224 of May 1994 and byGovernment Decree No. 39 of January 1995. According to the new Constitution of the Republic ofArmenia, adopted in 1995, any alterations to the Tariff were required to be adopted by the NationalAssembly. The Law on Customs Tariffs Rates, adopted by the National Assembly in April 1997,introduced the new list of customs duties. The rectification of the Law on Customs Tariffs wasaccomplished by the Law on Amendments to the Law on Customs Tariffs in September 1997.   InDecember 1998, the Law on Customs Duties was adopted by the National Assembly.  The Law onCustoms Duties covered the following sections:  customs duties and types thereof;  customs valuation;
and customs tariffs rates.  Thus an integration of the Law on Customs Tariffs of the Republic of
Armenia and the Law on Customs Tariffs Rates of the Republic of Armenia had been made. The LawWT/ACC/SPEC/ARM/1/Rev.7
Page 23
was in full compliance with the relevant WTO provisions.  Armenia had been using the Harmonized
System of Commodity Classification since 1991.  In July 2000, the new Customs Code Republic ofArmenia was adopted by the National Assembly, which incorporated the provisions of the Law onCustoms Duties, including the customs duty rates.  The Customs Code entered into force on
1 January 2001.
49. The representative of Armenia said that the customs tariffs were expressed in ad valorem
terms and were levied on c.i.f. values, except for tobacco products.  The Law "On Fixed Charges forTobacco Products" of 31 March 2000 provided that  customs duties on tobacco products were leviedat a fixed rate.  This law stipulated that imports of tobacco products  were subject to specific  chargesconsisting of a value added tax, an excise tax and customs duties, according to the following rates:
Table Two
CN Code Brief Description of ProductsAmount of fixed
charges (US$ for
1,000 items)
for imported
productsAmount of fixed
charges (US$ for
1,000 items)
for domestically
produced products
2402 10 001 Cigars 3,000 2,200
2402 100 09 Cigarillos 30 22
2402 20 900 Cigarettes with filters 11 8
2402 20 910 Cigarettes without filters 3 2.2
He further added that the difference between the fixed charges on imported products and the fixed
charges on domestically produced products represented a customs duty within the context of the
Republic of Armenia’s commitment on ad valorem tariff rate bindings, as follows:
Table Three
CN CodeBrief Description of
ProductsAverage Value of
Imports in 2001
(per 1000 items)
US$Specific Customs
Duty (rate per 1000
items)
US$Equivalent Ad
Valorem Customs
Duty rate
%
2402 10 001 Cigars 5,750 800 13.9
2402 100 09 Cigarillos 65 8 12.3
2402 20 900 Cigarettes with filters 27  3 11.5
2402 20 910 Cigarettes without filters  27 3. 8 14.6
50. In response to requests for information on any further specific duties charged on imports, he
noted that the Law on Amendment to the Customs Code of the Republic of Armenia of 26 December
2000, established customs duties for alcohol and alcoholic beverages.  Some members of the WorkingWT/ACC/SPEC/ARM/1/Rev.7
Page 24
Party expressed concerns that the specific rates applied might exceed the bound ad valorem  rate.  In
response, the representative of Armenia stated that following accession, the Ministry of Trade wouldperiodically review specific rates against average im port values for subject goods to ensure that those
rates did not exceed the bound ad valorem  equivalent rate.  In response to further requests for
information he provided the following table:
Table Four
HS number Product description Unit MeasureCustoms
Duty
Rate
(AMD)Average
of
Customs
Value
(AMD
per liter)Equivalent Ad
Valorem
Customs Duty
Rate %
2203 Beer 1 litre 50 434.8 11.5
2204 Grape wines 1 litre 100 845.0 11.8
220410 Sparkling wines 1 litre 75 591.0 12.7
2205 Vermouth and other wine of
fresh grapes flavoured with
plants or aromaticsubstances1 litre 140 1166.6 12.0
2206 Other brewed drinks (for
example, cider, perry,
mead);1 litre 60 572.9 10.5
2207 Ethyl spirit 1 litre
(by recalculation
of 100% spirit)70 498.2 14.1
2208 Spirit drinks, including
220820 Made from distillation of
grape wine and wine
ingredients (cognac,armanyak, etc.)1100 7329.3 13.9
220830 Whiskies 370 2892.9 12.8
220840 Rum & tafia 420 2438.6 12.9
220850 Gin & Geneva 450 3913.0 11.5
220860 Vodka 240 2000 12
220870 li quor, and fruit-vodka 600 5454.5 11
220890 Other1 litre
(by recalculationof 100% spirit)
240 1920.0 12.5
51. The representative of Armenia stated that 279 items were specified in Armenia’s tariff
schedule.  The majority of product categories identified at the two-digit level of the HarmonizedSystem had the same rate of duty. Some members of the Working Party asked whether it would bepossible to disaggregate the tariff to the four or greater digit level.  In response, the representative ofWT/ACC/SPEC/ARM/1/Rev.7
Page 25
Armenia stated if it proved necessary the Govern ment of Armenia would continue disaggregating its
tariff schedule from its present level.
52. The representative of Armenia noted that more than sixty per cent of the items in the tariff
schedule were subject to a duty rate of zero (161 items) with the remaining 97 items subject to a 10
per cent duty rate.  Taking into account the volume of imported goods belonging to each of those
groups, the weighted average tariff was less than 4 per cent. Tariff revenue comprised about 5.06 percent of budget revenue in 2001.
53. The representative of Armenia stated that the rates of customs duty would not be increased
beyond levels bound in Armenia’s WTO Schedule of Co ncessions on Goods, which is annexed to the
Protocol of Accession of Armenia.  The Working Party took note of this commitment.
- Other duties and charges levied on imports
54. The representative of Armenia confirmed that there were no other duties and charges levied
on imports except ordinary customs duties and the fees for services rendered by customs bodies as
described in paragraphs 57-62 below.   Any such charges applied to imports from the date of
accession would be in conformity with WTO provisions of Armenia's Protocol of Accession.  Therepresentative of Armenia confirmed that regarding import/export documentation there was norequirement for authentication of the documentation by Armenian consulates overseas, and there wasno fee charged in this respect. The representative of Armenia stated that Armenia would bind allduties and charges, other than ordinary customs duties, at zero in Armenia's Market AccessionSchedule under Article II:1(b) of the GATT 1994, annexed to the Protocol of Accession of Armenia.The Working Party took note of this commitment.
- Tariff rate quotas
55. The representative of Armenia stated that Armenia did not apply any import quotas, including
tariff rate quotas.  The representative of Armenia confirmed that his Government had no plans tointroduce tariff rate quotas.
- Tariff exemptions
56. The representative of Armenia stated that all tariff exemptions other than those granted in the
context of free trade area agreements were granted on a MFN basis.  According to Article 18 of theRepublic of Armenia Law on Customs Duties of 30 December 1998, tariff exemptions were granted
in respect of the following:WT/ACC/SPEC/ARM/1/Rev.7
Page 26
- capital assets imported by foreign investors and designated for a statutory fund of joint
ventures and enterprises with foreign investments;
- goods in transit through the Armenian territory;
- trucks and vehicles, regularly operating as freight and passenger carriers through the
Armenian territory, as well as fuel, food, tools and other minor items necessary fortemporary use to perform these operations;
- foreign exchange, bonds and other securities;
- goods imported into the Republic of Armenia within the framework of humanitarian aid
or charity programs;
- specific goods temporarily imported into Armenian territory and further exported
without being processed, such as fair and exposition exhibits, commodity patterns and
package, professional equipment of tempor ary visitors, advertising materials, live
animals, etc.;
- goods imported into duty-free shops for s ubsequent exportation from the Armenian
customs territory;
- goods imported into the Republic of Armenia as a property of foreign clients with a
view of processing in the Republic of Ar menia’s territory and subsequent exportation;
- goods and articles imported by the Cent ral Bank of the Republic of Armenia;
- any other instances foreseen in international agreements.
According to Article 104 of the new Republic of Armenia’s Customs Code, which had replaced the
Law on Customs Duties, the following goods were exempt from the imposition of customs duties:
- goods in  transit;
- goods  temporarily imported;
- goods  temporarily exported;
- goods temporarily imported for  inward processing;
- goods temporarily exported for outward processing;
- goods released into  a customs warehouse;
- goods released into  a free customs warehouse;
- goods released under the regime of re-importation and re-exportation, except for the
cases foreseen by the Code;
- goods released to be  destroyed;
- goods released to a  duty free shop;
- vehicles used for regular interstate transport of freight,  luggage and travellers, as well
as tools, fuel, foodstuffs, which may  be needed during the trip, at stopovers or forfixing the malfunctions of the mentioned means of transport;
- currency, foreign currency and securities;
- goods imported into the Republic of Armenia within the framework of humanitarian
aid or charity programmes;
- goods imported into the Republic of Armenia for the contribution to the statutory
fund of commercial organizations and included in the list of goods established by the
Government of the Republic of Armenia;
- sample quantities of goods imported into the Republic of Armenia within the
framework of exhibitions, international fairs and similar events.
- Customs fees and charges for services rendered
57. Some members of the Working Party stated that they considered the ad valorem  customs fee
levied by Armenia on imports was inconsistent with the provisions of the WTO, in particular, ArticleWT/ACC/SPEC/ARM/1/Rev.7
Page 27
VIII of the GATT 1994.  They also noted that a transition period to bring the fee into conformity with
Article VIII was not appropriate.  Those members c onsidered that Armenia should conform with the
requirements of Article VIII from the date of accession, and from that time the proceeds from thecollection of fees should only be used for the operation of customs clearance facilities.  They further
stated that  total  revenues from the fee  should not exceed the actual cost of customs clearance of the
imported goods.  Those members stated that following accession, Armenia should provideinformation on the method of calculation of the fee and the cost of provision of customs clearancefacilities,  to WTO Members upon request.
58. In response, the representative of Armenia stated that according to the amendment to
Government Decree No. 615, which had entered into force on 1 May 1996, an ad valorem, customsfee of 0.3 per cent had been charged on imports, with the upper limit of AMD 600,000 (approximatelyUS$1,200).  The Law on Customs Fee, adopted by the National Assembly on 28 December 1998,abandoned the ad valorem principle for the charging of customs fees replacing it with a uniform fee of
Dram 3,500 (about US$6.50) for customs processing and specific weight-related fee of Dram 300 per
ton (about US$0.55) for freight inspection.  Article 3 of the Law on Customs Fee, set the amounts ofthe fees.   
59. He further noted that the Republic of Armenia’s Customs Code, which incorporated the
provisions of the Law on Customs Fees, was adopted by National Assembly on 28 December 1998.According to Article 110 of the new Code, the follow ing rates of customs fees were applicable as of
1 January 2001:
1. A customs fee of AMD 3,500 for the customs formalities (apart from inspection and
registration) in respect of the goods and means of transport carried across the customsborder of the Republic of Armenia, as well as currency and foreign currency carried
by the banks.
2. A customs fee levied on the inspection and registration of the goods, except the goods
transported through pipelines and electric transmission circuits, the amount of:
- AMD 1,000 for the customs control of cargo declared under the same
declaration and having up to one ton of weight;
- AMD 300 for each additional (or incomplete) ton of weight of cargo declared
under the same declaration and having above one ton of weight.
3. A customs fee of AMD 500,000 monthly for the customs control and registration of
the goods transported through pipelines and electric transmission circuits.
4. If the customs formalities are performed in places other than those specified by the
customs bodies, the customs fees should be levied as twice the amount of the ratesprescribed by Article 110.WT/ACC/SPEC/ARM/1/Rev.7
Page 28
5. A customs fee of AMD 1,000 for each document form distributed by the customs
bodies.
6. A customs fee of AMD 10,000 per each 100 km for the customs escort of the goods
throughout the customs territory of the Republic of Armenia.
7. A daily customs fee for the cargo stored by the customs bodies:
- AMD 1,000 for the cargo under 1 ton of weight;
- AMD 300 for each additional one (or incomplete) ton of cargo;
8. A customs fee for the customs control of the means of transport:
- AMD 2,000 for a car with up to 10 seats;
- AMD 5,000 for other means of transport.
According to Article 111 of the new Customs Code , the following goods were exempt from the
customs fees:
- goods that entered into the customs territory of the Republic of Armenia within the
framework of humanitarian aid and charity programmes;
- all goods carried across the customs border of the Republic of Armenia by natural
persons and permitted for duty free importation;
- cultural values exported under the regime of temporary exportation and subject to re-
importation;
- means of transport involved in regular international transport operations when in the
course of such transportation.
The fee was also applied to exports and to import purchases by the Government of Armenia. Proceeds
from customs fee collection are transferred to the State budget.
60. Members noted that Armenia’s exemption of domestic agricultural output sold by farmers
from the value added tax appeared to constitute di scriminatory treatment of imports in relation to
similar domestic products and was therefore incons istent with Article III of the GATT and should be
eliminated upon accession.  The representative of Armenia responded that the value added tax
exemption for farmers was not extended beyond the point of first sale, i.e., agricultural produce afterit left the farm was subject to application of the VAT, and that it was not intended to discriminate
against imports.  The exemption was an integral part  of Armenia’s agricultural support system and, a
transitional period of application after accession would be necessary prior to its elimination in order tominimize harm to Armenia’s agricultural sector.  In this regard, legislation would be adopted by
Armenia’s Parliament prior to adoption of the terms of accession by the WTO General Councileliminating the VAT exemption.  This legislation, Law No. […], was enacted on […] 2002 and wouldbe implemented from […] 2009.
61. The representative of Armenia confirmed that his government had enacted legislation that
would eliminate, by December 31 2008, the existing exemption from the value added tax of domesticWT/ACC/SPEC/ARM/1/Rev.7
Page 29
agricultural production sold by producers.  He added that during this period, the scope of the
exemption would not be increased, either in terms of coverage or level of exemption, nor would thescope or amount of the tax exemption be restored if it were reduced during this period.  He furtherconfirmed that, to ensure transparency during this period, Armenia would notify the General Council
annually of the status of the tax exemption, and on  its scope and level.  Upon request, Armenia would
consult with WTO Members concerning the status of the VAT exemption and its effect on their trade.The Working Party took note of these commitments.
62. The representative of Armenia confirmed that from the date of accession, Armenia would not
reintroduce an ad valorem customs fee.  The fee for customs processing established under the Law onCustoms Fees of 30 December 1998 and as of 1 January 2001, by the new Republic of Armenia’s
Customs Code, would be applied in conformity with WTO obligations, in particular Articles VIII andX of the GATT 1994. The level of applied fee would not exceed the approximate cost of customsprocessing of individual import and export transactions.  Revenues from the collection of the fees
would be used solely for customs processing of imports and exports, and total annual revenue from
collection of the fees would not exceed the approximate cost of customs processing operations for theitems subject to fees. He also confirmed that revenues from the fees were not used for customsprocessing of imports exempted from the fees.   Information on the application and level of the fees,revenues collected and their use, would be provided to WTO Members upon request. The WorkingParty took note of these commitments.
- Application of internal taxes to imports
63. The representative of Armenia informed the Working Party that Armenia's tax system had
been completely overhauled since 1992, as part of the Government's overall policy of economic
transformation towards a market economy. On 14 April 1997 the National Assembly of the Republic
of Armenia adopted the new Law on Taxes. Under this Law the taxes applied in Armenia were as
follows:
- value added tax;
- excise tax;
- profit tax;
- income tax;
- property tax;
- land tax
- simplified tax.WT/ACC/SPEC/ARM/1/Rev.7
Page 30
In particular, two indirect taxes were imposed on imports and domestic production in Armenia - the
value added tax, which was charged on the turnover of  goods and services, and the excise tax on certain
goods. He recalled that details of those taxes were provided in paragraphs 64-71 below of this Report.
- Value Added Tax
64. The representative of Armenia informed the Work ing Party that after the Law on Value Added
Tax entered into force on 1 July 1997, the destination principle of VAT application was applied to allcountries.  Armenian exports to any destination were charged at zero rate, and any imports to Armeniawere charged at the standard rate.  In this rega rd, Armenia ensured MFN treatment in the application
of VAT to imports.  The VAT was uniformly charged at the rate of 20 per cent on sales of domestic andimported goods and services.  The value added tax was calculated and levied by customs bodies ongoods imported to Armenia irrespective of the countries  of exportation.  With respect to certain imported
goods with zero customs duty rate and not subject to  excise tax, listed in the Law "On approval of the
list of goods imported by organizations and private en terprises that have zero custom duty rate and are
not subject to excise taxation and for which VAT shall not be calculated and levied by customs
authority" adopted by the National Assembly on 25 June 2001, the value added tax was calculated and
levied by the Tax Authorities upon their sale or consumption.
65. He further added that the VAT for all imported goods (except for goods to which a 0 per cent
customs duty applied and which were not subject to excise tax) was levied by customs bodies at the
moment of importation irrespective of the country of   origin.  The items exempted from VAT included:
education in secondary schools, exercise books and music books for schoolchildren scientific research
work; sales of veterinary drugs; sales of domesti cally produced agricultural products by the producer;
activities related to the provision of pensions; some financial operations and services, etc.  In addition,
zero-rate tax was applied to:  the taxable turnover of goods exported out of the customs territory of
Armenia; goods imported for official usage by dipl omatic and consular representations or by other
equivalent international, intergovernmental (inter state) organizations, as well as goods and services
acquired by those organizations in the territory of Armenia; transit of foreign pay-loads through the
territory of Armenia; construction and relevant (designi ng, research, etc.).  He recalled that the full list of
VAT exemptions had been provided to the Working Party.  That list forms Annex 2 to this Report.
-E x c i s e  T a x
66. In response to requests for information from members of the Working Party concerning
excise tax the representative of Armenia stated  that according to the Law on Excise Tax,  which
entered into force on 1 August 2000, imposed excise tax on both domestic and imported goods.WT/ACC/SPEC/ARM/1/Rev.7
Page 31
Excise tax on imported goods was collected by the customs authorities, and excise tax on local
production was collected by the tax authorities. According to the Law on Excise Tax, excise tax wasimposed on the following goods:
- Beer;
- Grape and other wines, wine  ingredients, including:
- sparkling wines;
- champagne;
- Vermouth and other wine of fresh grapes flav oured with plants or aromatic substances;
- Other brewed drinks, including:
- made from distillation of grape wine and wine ingredients (cognac, armagnac, etc.);
- vodka, liquor, and fruit-vodka;
- Tobacco substitutes;
- Primary oil and oil
- Diesel fuel;
- Oil gas and other gaseous hydrocarbons (except for natural gas).
67. He added that for goods produced in Armenia the amount of excise tax collected was based
the value of the turnover or the sale of the goods, based on the sales prices (without excise and valueadded taxes). The taxpayers producing/selling taxable goods in Armenia paid the excise tax  ondomestically produced goods within ten working days following the sale of goods.  For goodsimported into Armenia the amount of excise tax collected was based on the customs value of thegoods  (without value added taxes and customs tariffs).  In the Republic of Armenia excise taxescharged on imported goods were levied by the customs bodies within ten days after importation.
The rates of excise taxes were as follows:
Table Five
HS number Product description Taxable base Rate(AMD)
2203 Beer 1 litre 70
2204
220410Grape and other wines, wine ingredients,
 includingSparkling wines,Champagne1 litre 100
180
250
2205 Vermouth and other wine of fresh grapes flavoured
with plants or aromatic substances.1 litre 500
2206 Other brewed drinks (for example, cider, perry,
mead);1 litre 180
2207 Ethyl spirit 1 litre (by
recalculation of
100% spirit)600
2208
220860,
220870Spirit drinks, including
Made from distillation of grape wine and wineingredients (cognac, armangac, etc.)Vodka, liquor, and fruit-vodka1 litre 1,500
1,200
300
2403 Tobacco substitutes 1 kilogram 1,500
2709 Primary oil and oil 1 ton 27,000WT/ACC/SPEC/ARM/1/Rev.7
Page 32
HS number Product description Taxable base Rate(AMD)
271000690 Diesel fuel 1 ton 11,500
2711 (excluding
271111 and
271121)Oil gas and other gaseous hydrocarbons (except for
natural gas)1 ton 1,000
For goods under code 2208 with spirit concentration over 40 per cent the tax rate was increased by
additional AMD 7.5 for each per cent exceeding 40 per cent.  The excise tax rates of tobacco products
and petrol were determined by separate laws.  The Law  "On Fixed Charges for Tobacco Products" of
31 March 2000 established fixed fees on tobacco products. According to the Law the fixed fees onimported tobacco products substituted for the value added tax, the excise tax and customs duties, andthe fees on tobacco products produced in Armenia substituted for the value added tax and the excise
tax. The law stipulated the following rates for imported and domestically produced tobacco products:
Table Six
Amount of fixed fees
($US for 1,000 items)CN code Brief Description of ProductsOn imported
productsOn domestically
produced products
2402 10 001 Cigars 3,000 2,200
2402 100 09 Cigarillos 30 22
2402 20 900 Cigarettes with filters 11 8
2402 20 910 Cigarettes without filters 6 2.2
68. The representative of Armenia stated that on 1 January 1997 Armenia equalized excise taxes
on domestic goods and imports of the same or like products as part of its accession commitments (seetables five and six of this Report).  Furtherm ore, from  1 August 2000 the new law on Excise Tax
defined specific tax rates, that were the same for both domestically-produced and imported goods.
69. Some members of the Working Party stated that they considered that the taxation of vodka was
only one-fifth the rate of excise taxation of other spirits .  This appeared to conflict with the provisions of
Article III concerning the taxation of similar products.  Those members requested that Armenia present
information on how it intended to bring its excise taxa tion of vodka into conformity with the its excise
taxation of other distilled spirit beverages.   Some  members of the Working Party also noted that the
different rates of excise tax for tobacco products constituted a tariff duty applied within Armenia's
bound rates of duty.  In response, the representative of Armenia stated that as the rate of excise tax
applied to imported vodka was the same rate as a pplied to the "like product of domestic origin", i.e.WT/ACC/SPEC/ARM/1/Rev.7
Page 33
vodka, Armenia was of the view that there was no conflict with the provisions of Article III of the
GATT 1994.
70. Some members of the Working Party noted that the non-application of these taxes to imports
from FSU States could  be seen to give rise  to discrimination against products from non-FSU
countries.  The representative of Armenia stated that Armenia had switched to the destination
principle of taxation with respect to imports from all sources.  In addition Armenia was attempting topersuade its CIS trading partners of the desirability of charging these taxes at destination and notorigin.  He further confirmed that no credit was given for excise taxes applied in the exporting CIScountry when determining the amount of excise tax payable for CIS imports into Armenia.
71. The representative of Armenia confirmed that, from the date of accession, Armenia would
apply its domestic taxes, including value-added and excise taxes, in a non-discriminatory mannerconsistent with Articles I and III of the GATT 1994, with the exception noted in paragraph 61 above.In this regard, in accordance with the new Laws on VAT and on Excise tax, these taxes were applied
at an equal rate on domestic and imported goods and Armenia applied the destination principle to
value-added and excise taxes with respect to imports from all sources, and no credit was given forexcise or other taxes applied to imports in their home markets prior to export to Armenia. In addition,the method of application of all indirect taxes applied to imports would be published in the officialnewspaper or other widely available source and readily available to importers, exporters, anddomestic producers. The Working Party took note of these commitments.
- Quantitative import restrictions (including prohibitions, quotas and licensing systems)
and licensing procedures
72. The representative of Armenia stated that Resolution No. 124, 29 December 1995,  regulated
non-tariff measures in Armenia.  Most imports  were free of any prohibitions or quotas. Import
restrictions were imposed only for health, security, and environmental reasons. The items affectedwere all kinds of weapons; military technology and the consumables necessary for its production;technologies, equipment and locators of nuclear ma terials (including heating materials); special non-
nuclear materials and services related to it; and ionizing radiation sources.  The importation of thoseproducts  was subject to  specific authorization issued by the Government of the Republic of Armenia.In response to requests from members of the Working Party, the representative of Armenia stated thatArmenia would provide its initial notification of the laws and measures that establish theserequirements and give illustrative HS classification numbers to the Committee on Import Licensing
upon accession.WT/ACC/SPEC/ARM/1/Rev.7
Page 34
73. The representative of Armenia noted that, taking into consideration the need to control the
safety of certain products, labour and services for the protection of the national environment andhuman life and health, as well as the protection of consumer rights, some products were subject tomandatory conformity assessment according to Resolution No. 239, 12 May 2000. Pharmaceutical
products and medicines are excluded from the list of products subject to mandatory conformity
assessment (mandatory certification), but were subject to import and export permission requirements.The representative of Armenia stated that the list of pharmaceutical products and medicines subject toimport and export permission was established  by Government Resolution 581 of 20 September 2000as follows:
Table Seven
HS number
Pharmaceutical products,
medicines051000; 1211; 2941; 3001; 3002;  3003;
3004; 3005; 300630 000; 300650 000; 300660; 380840;1108*; 1301; 1302; 1504; 152000 000; 1702;1804; 1805; 2207; 2209; 2501; 2520;
2712; 2801-2802; 280440 000; 281000 000; 284700 000;
285100;  2904-2909; 2912-2940; 2942; 3301.
*  1108 and the following categories of products in the list used for pharmaceutical purposes, are subject to
import and/or export permission.
74. The representative of Armenia stated that according to the provisions of the “Law on
Licensing” of the Republic of Armenia, the types of activities subject to licensing are as follows:
- Security Sector (production of explosive materials, production of weapons, trade in
weapons, collection and exhibition of weapons, acquisition of weapons, production of
or trade in narcotic drugs, anaesthetic and radioactive materials, money printing or
coining, preparation or production of state medals, stamps and seals, import or export
of narcotic drugs, production of explosives or equipment for explosions, trade inexplosive materials or equipment for explosion, explosive works, production of
import of or trade in fireworks materials);
- Trade Sector (organization of trading in the exchanges (non-stock));  Health Sector
(production of medicines, trade in medicines, trade in herbs, medical aid and services
by organizations or individual entrepreneurs, genetic engineering, implementation ofmedium professional and high medical educational programs);
- Currency Regulation Sector (foreign currency trading, organization of foreign
currency auctions); Securities Turnover Sector (printing of securities forms,
professional activities in the securities market);
- Banking and Financial Organizations Sector (banking activities, organization of
pawnshops, activities of investment companies, investment funds, insurance activity,
rendering of collection services, insurance brokerage and mediation, rendering of
audit services);  Agricultural Sector (veterinary, bloodstock breeding);
- Power Engineering Sector (production, import and export, transport, distribution of
and trade in natural gas; production, import, transmission, export, distribution of andWT/ACC/SPEC/ARM/1/Rev.7
Page 35
trade in electrical energy; production, import and export, transport, distribution of and
trade in of thermal energy; rendering services on transmission and centralized
regulation of electrical energy; construction of new capacities in the fields of
electrical and thermal powers);
- Education Sector (implementation of basic general educational programs,
implementation of secondary (full) general educational programs, implementation of
special general educational programs, implementation of higher professional
educational programs, excluding medical programs);
- Telecommunications Sector (rendering of telephone services, rendering of telegraphic
communication services, rendering of data transmission services, rendering services
on broadcasting of radio-television prog rams, production of trade in or import of
radio-electronic devices within the frequency range above 9KHz and 400, productionof radio-television programs, broadcasting of radio-television programs, production
and broadcasting of radio-television programs);
- Customs Sector (maintenance of goods under customs control in the customs
warehouse, trade in goods under customs control in duty-free shops, maintenance of
goods in free customs warehouse, customs mediation, activities of a customs carrier);
- Nuclear Power Sector (works on selection, construction, putting into operation,
operation, usage, maintenance and removing away from operation of nuclear and
radioactive waste stations, sources and storage of ionizing radiation; works with
radioactive wastes of nuclear and radioactive materials, including transportation,
usage, storage, reprocessing and burial of such materials; import and export ofnuclear, radioactive and special materials, radioactive wastes, special equipment,
technologies; design and preparation of materials, equipment and systems for projects
using atomic energy; expertise of projects using atomic energy, their designs and
other documents);
- Environment Protection Sector (reprocessing, neutralization, storage, transport and
placement of dangerous wastes);
- Quality, Standardization, Certification, Meas urement Sector (production and repair of
measurement means);
- Lotteries and Price Games Sector (organization of lotteries, organization of games of
chance, organization of gambling halls);
- Transport Sector (activities of scheduled air transport, activities of not-scheduled air
transport, organization of railroad transport);
- Urban Construction Sector (elaboration of urban construction documents in the area
of capital construction in the following fields of urban construction, civic, industrial,
transport, hydro technical, power engineering, communication, special; capital
construction in the following fields of urban construction, civic, industrial, transport,
hydro technical, power engineering, communication, special);
- Activities in other fields (statutory expertise examinations of types of activities
subject to licensing, non-official publication, duplication or official re-publication of
laws and legal-normative acts, implementation of activities of an administrator on
insolvency issues of insolvent enterprises, site and cadastre mapping, evaluation of
real estate, realtor activity, foodstuff production).
75. In response to questions concerning the importation of pharmaceutical products and
medicines, the representative of Armenia stated that the importation of those products requiredauthorisation from the Ministry of Health of the Republic of Armenia (except for veterinary drugs andrelated products).  Resolution 581 "On issuing permission for importing and exporting
pharmaceuticals", stipulated that:WT/ACC/SPEC/ARM/1/Rev.7
Page 36
- permissions for importation of pharmaceuticals were issued by the Ministry of Health of the
Republic of Armenia;
- the permissions were for single use only;
- permissions could  be obtained by:
- those importers that had a licence for conducting exportation and importation activity in
pharmaceutical products and (or) medicines,  given by the Ministry of Health;
- those importers that have a licence for production of pharmaceutical products and (or)
medicines, given by the Ministry of Health;
- those importers who had no licence, but whose activity was connected to the
pharmaceutical products and medicines research, experimental testing, quality,
effectiveness and safety control.
76. He further added that to obtain permission to  import those products, the following documents
and conditions were required:
(a) a licence for commercial activities involving pharmaceutical products in the Republic of
Armenia.   (The Law on Licensing, Resolu tion 36). The Law on Licensing stipulated
that the production and trade in medicines,  trade in herbs, pharmaceutical activities,
medical aid and services by organisations  or  individual entrepreneurs, genetic
engineering, implementation of medium pr ofessional and high medical educational
programs were subject to State licensing in the Republic of Armenia.  After the Law on
Licensing had been adopted and entered into force some Resolutions needed to bechanged to avoid overlaps and disparity.  The Ministry of Health was responsible for
these changes, but Resolutions except Resolu tions 161 and 415 were still in force.  The
Law "On Medicines" stipulated that im portation and exportation activity had to be
licensed.  Specific requirements for importa tion and exportation activity licensing were
being elaborated by the Government.  Pres ently, a licence for wholesale trade gave to
business entities a right to conduct importation and exportation activities.  Resolution 36
stipulated that:
- pharmaceutical and medical activities were subject to licensing in the Republic of
Armenia;
- licensing was carried out by the Ministry of Health;
- licenses were issued for a period of 5 years.
Licenses for wholesale and retail trade in pharmaceutical products and medical utensils
were issued by the State Licensing Co mmittee of the Ministry of Health. The
procedures for issuing licenses were approved by the Resolution 188. The same
procedures (including import permission for pharmaceuticals) applied to individuals
who had received medical and pharmaceutical e ducation in foreign countries.  In the
case of the existence of international agreements signed by the Republic of Armenia theprocedures specified in the agreement applied (Resolution 188, 24 July 1996). Foreign
specialists invited to implement programs  of international and intergovernmental
agreements were not subject to licensing.WT/ACC/SPEC/ARM/1/Rev.7
Page 37
(b) Imported or exported pharmaceutical products were required to  be registered in the
Republic of Armenia. The registration of pharmaceutical products and medical utensils
was performed in the Republic of Armenia in accordance with the recently passed Law
"On Medicines" and in compliance with re gistration requirements, approved by the
Pharmaceutical Department of the Ministry of Health.
(c) Imported and exported pharmaceuticals should ha ve at least one year of their expiration
period remaining, except for the pharmaceuticals whose original period of expiration
was less than one year (the latter should have at least two-thirds of the period of
expiration remaining at the time of importing).
77. The representative of Armenia further stated that any person, firm and institution wishing to
apply for an import permission could do so if they possessed an appropriate license to performpharmaceutical activities.  Registration as a juridical person or sole entrepreneur was an automaticprocedure, subject only to any state licensing requirement (as applicable). Applications forpermissions were required to be determined within ten days of receipt of an application, although inpractice permissions could be obtained within a shorter time period.  If goods arrived withoutpermission, they could only be cleared throug h customs upon production of the necessary import
permission.
78. The representative of Armenia added that to receive permission for importation of
pharmaceutical products the following documents were required: an application form, adocument/contract relating to the acquisition of the pharmaceutical products, a licence to trade inpharmaceutical products in Armenia, a certificate of quality issued by the producer.  The importationpermissions were issued after the collection of a corresponding fee.  In response to further questions,the representative of Armenia stated that fee was designed to only cover the costs of the servicesrendered in considering the application.  The amount of the fee varied from application to applicationaccording to the particular expertise called upon to consider the application.
79. The representative of Armenia said that requests for permission could be refused if  (a) there
was incorrect and/or insufficient information in th e presented documents,  (b) the minimum shelf life
requirement was not met  (c) the actual pharmaceuticals  did not correspond to the specificationsstated in the importation documents  (d) the imported pharmaceuticals were not registered in Armeniaor(e) the quality of imported pharmaceutical products did not correspond to quality standards acceptedin the Republic of Armenia. Unjustified delays and refusal to issue permission could give rise tojudicial procedures within 30 days after the refusal.
80. The representative of Armenia further noted that permissions were issued for the period
necessary to carry out the engagements, but no longer than three months. The validity of a permission
could be extended upon the substantiated request of an applicant. The body issuing the permissionWT/ACC/SPEC/ARM/1/Rev.7
Page 38
could suspend its validity or cancel it. Permissions were not transferable among importers.  In
response to further questions he confirmed that permissions and licenses were available to bothdomestic and foreign entities, provided that they were commercially registered, and that there was nodifference in the requirements to obtain a licence depending on whether an applicant was domestic or
foreign in origin.
81. The representative of Armenia stated that there were no agrochemicals other than fertilizers
(HS 3102-3105) subject to mandatory conformity assessment (mandatory certification).  Pursuant toDecree No. 124 of 19 December 1995 importation of phytoprotection chemicals (HS 38.08) should bepermitted by the Ministry of Agriculture, moreover the permission for importation of phytoprotectionchemicals should also be approved by the Inspect ion of Plant Protection office in the Ministry of
Agriculture.  The authority to make changes and amendments in the list of registered phytoprotectionchemicals permitted to be imported was delegated to the Inspection of Plant Protection office in theMinistry of Agriculture (pending the establishment of the State Interdepartmental Committee for
Registration of Phytoprotective chemicals. Imported or exported agricultural chemicals must be
registered in the Republic of Armenia).  According to the Rules on issuing permission on import ofplant protection agents into the Republic of Armenia, to issue a  permission the following documents
were required:  a) An application by the importer; b) a certificate of origin and quality certificateissued by the producer or an appropriate organization.  Import permission for agrochemical productswas given for an import transaction (for single use). Permission was given only to thoseagrochemicals which were included in the list of phytoprotection chemicals registered in Armenia.  A
permission was normally given in 24 hours after receiving permission requirement documents.  Apermission could be refused in case of incorrect information provided by an importer in the
requirement documents.  Unjustified delays and refusal to issue permission could give rise to judicial
procedures, including to rights in the Code to appeal the superior body.
82. The representative of Armenia confirmed that, at the latest by the date of accession, Armenia
would provide an initial notification of all laws, regulations and other procedures regulating its importlicensing or permission requirements, i.e. the list of measures, the legislation and its  responses to theimport licensing questionnaire to the Committee on Import Licensing.  The Working Party took noteof this commitment.
83. The representative of Armenia confirmed that, from the date of accession, Armenia would
eliminate and would not introduce, re-introduce or apply quantitative restrictions on imports or other
non-tariff measures such as licensing, quotas, bans, permits, prior authorization requirements,
licensing requirements, and other restrictions having equivalent effect, that cannot be justified underWT/ACC/SPEC/ARM/1/Rev.7
Page 39
the provisions of the WTO Agreement. He further confirmed that the legal authority of the
Government of Armenia to suspend imports and exports or to apply licensing requirements that couldbe used to suspend, ban, or otherwise restrict the quantity of trade would be applied from the date ofaccession in conformity with the requirements of the WTO, in particular Articles XI, XII, XIX, XX,
and XXI of the GATT 1994, and the Multilateral Tr ade Agreements on Agriculture, Sanitary and
Phytosanitary Measures, Import Licensing Procedures, Safeguards and Technical Barriers to Trade.In this regard he also stated that the same kind of requirements contained in Resolution No. 124, 29December 1995 relating to imports would be equally applied to imports and to the purchase or sale ofsimilar domestic products.  Any exemptions from those requirements would be equally applied toimports and the output of domestic firms. The Working Party took note of these commitments.
- Minimum import prices
84. The representative of Armenia noted that Armenia did not maintain a system of minimum
import prices.
- Customs Valuation
85. Some members of the Working Party referred to the Agreement on Customs Valuation and to
certain inconsistencies of the Customs Regulations of Armenia in respect of customs valuation.Those members requested more detailed explanations with regard to the implementation by Armeniaof specific provisions of the Customs Valuation Agreement, in particular Articles 7, 8, 10, 11 and 12thereof.
86. Noting that Armenia was a member of the World Customs Organization, the representative of
Armenia stated  that the customs valuation regime was set out in  the Procedure for the Calculation ofthe Customs Value of Imported Goods attached to Government Decree No. 615 of 6 December 1993,
and the Law on Customs Tariffs of 18 August 1993, and, following repeal of the Law on Customs
Duties, by the Customs Code which entered into force on 1 January 2001.
87. According to those Laws, the primary method fo r determination of the customs value was the
transaction value method. The Law, as well as  the new Republic of Armenia’s Customs Code,
provided for the same six methods of valuation laid out in the Agreement on Implementation ofArticle VII of the GATT 1994.  In response to furt her questions, the representative of Armenia stated
that Paragraph 3 of Article 12 of the Law on Customs Duties provided a possibility of reversal of theorder of application of the valuation methods specified in Articles 5 and 6 of the Customs ValuationWT/ACC/SPEC/ARM/1/Rev.7
Page 40
Agreement upon request of an importer. This provision was included in Article 94 (Paragraph 2) of
the new Republic of Armenia’s Customs Code.
88. In response to questions of some members of the Working Party concerning sales between
related persons the representative of Armenia stated that provisions concerning such sales were
incorporated in Articles 78 and 87 of the Customs Code.  Concerning Article 11 of the Customs
Valuation Agreement, Paragraphs 2 and 3 of Article 13 of the Law on Customs Duties, as well asArticle 96 of the new Customs Code, provided for appeal procedures concerning the decisions andactions of Customs bodies as regards the customs valuation of goods.  Paragraph 4 of Article 12 of theLaw on the Customs Duties included provisions regarding the circumstances specified in Article 5.2of the Valuation Agreement.  The relevant provisio ns were incorporated in Article 91 (Paragraph 4) of
the new Republic of Armenia’s Customs Code.
89. In response to further questions, the representative of Armenia noted that the concept of
"price paid or payable" was covered by Paragraph 1 of Article 7 of the Law on Customs Duties
adopted in December 1998, as well as by Article 81 of the Customs Code. The representative of
Armenia said that in relation to Article 8 of the Customs Valuation Agreement, Article 83 of theCustoms Code stipulated that the customs value should include:
the transaction value of the goods in the country of exportation;
a) transport, loading, unloading, transhipment, insurance and other related costs made in
connection of the goods’ carriage up to the customs border of the Republic of
Armenia;
b) commission and brokerage accrued in relation to the carriage of the goods up to
customs border of the Republic of Ar menia, except buying commissions;
c) the costs of the following goods and services  where supplied directly or indirectly by
the buyer to the supplier free of charge or at  reduced cost for use in connection with the
production and supply of the goods carried across the customs border of the Republic
of Armenia:
i) the value of materials, components, part s and similar items incorporated in the
goods;
ii) the value of tools and other similar items used in the production of the goods;
iii) the value of materials consumed in the production of the goods;
iv) the value of engineering, artwork, design work, and other similar work
necessary for the production of the goods;
d) royalties and licence fees related to the sale of the goods being valued paid or payable
by the buyer, either directly or indirectly, to the supplier;
e) the value of tare, packing and packaging;
f) the amounts payable to the supplier by the buyer for the further sale, use and disposal of
the goods carried across the customs border of the Republic of Armenia.
90. In response to questions concerning the exchange rate applied by the Customs, the
representative of Armenia stated that the exchange rate used was derived from the daily foreignWT/ACC/SPEC/ARM/1/Rev.7
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exchange auctions held by the Central Bank of Armenia.  The Central Bank announced exchange
rates daily and these rates were published in the press, as required by Article 9.1 of the CustomsValuation Agreement.  In response to questions concerning the mechanism for protection ofconfidential information, the representative of Armenia stated that the provisions concerning
confidentiality of information were incorporated in Article 95 (Paragraph 2) of the new Customs Code
in conformity with provisions of Article 10 of the Customs Valuation Agreement.
91. In response to requests for a detailed description of the process of review of the decisions
made on customs valuation of goods, the representative of Armenia said that in relation to Article 11of the Customs Valuation Agreement, paragraphs 2 and 3 of Article 13 of the Law on Customs Dutiesprovided for appeal procedures on the decisions and actions of the customs bodies.  The Articleprovided for appeal of a decision by the customs body to a higher customs body or to a court.  Thehigher customs body should make its decision regarding the appeal and inform the applicant about thedecision within one month.  Respectively, paragraphs  2 and 3 of Article 96 of the new Code provided
for similar appeal procedures on the decisions and actions of the customs bodies.
92. The representative of Armenia said that as required by Article 12 of the Customs Valuation
Agreement, relevant national laws, regulations, decisions and rulings were published in the Bulletin ofthe Government of Armenia or in the Manual of the National Assembly of the Republic of Armenia.In relation to the obligation contained in Article 13 (last sentence) of the Customs ValuationAgreement, when the customs value of goods cannot be immediately determined, the formerparagraph 11 of Article 12 of the Law on Custom Duties had provided that:  when the customs bodiesdeemed it necessary to verify or further scrutinize the customs value declared by the applicant in the
respective declaration, importers were entitled to remove their goods from customs control against a
bank guarantee valid for one month, in  an amount equal to the disputed amount payable, on condition
of subsequent clearance in accordance with the final decision. He further noted that the new CustomsCode, Article 96 (Paragraph 1), had incorporated the content of Article 12 of the Law on CustomsDuties. Article 95 (Paragraph 1) of the Republic of Armenia’s Customs Code provided that the importer
upon a written request should be entitled, within five working days, to receive a written explanation ofthe valuation decision and the valuation method used by the customs authorities.
93. The representative of Armenia stated that all the provisions of the WTO Agreement on the
Implementation of Article VII of GATT 1994 would be  adopted as an integral part of Armenia’s
Customs Code upon Armenia’s accession to the WTO. All relevant laws would be in full conformity
with the requirements of the Agreement on Implementation of Article VII of the GATT 1994. In
particular, the interpretative notes of the Agreement would be fully incorporated in Armenia’sWT/ACC/SPEC/ARM/1/Rev.7
Page 42
customs valuation laws. As well, the Decision of 24 September 1984 on the Valuation of Carrier
Media Bearing Software for Data Processing Equipment was incorporated into the new Customs Code(Article 85, Paragraph (d)) ensuring that valuation of the software was based on the value of themedia.   The Working Party took note of these commitments.
- Other customs formalities
- Rules of origin
94. The representative of Armenia stated that the rules of origin applied by Armenia followed the
principles stated in the Agreement on Rules of Origin.  Origin rules set forth the definitions of thegoods wholly originating in one country, a change in the tariff classification of the goods, sufficient
processing criteria, and the value-added criterion.  The choice of a method for determining origindepended on the goods concerned and any relevant international agreement in respect of which originrules were being applied.  However, with the exception of the goods wholly originating in onecountry, the change in tariff heading criterion (at 4-digit level in the HS classification) was used
unless an alternative was stipulated. According to the procedure of determination of the country of
origin attached to Government Decree No. 615 of 6 December 1993, the country of origin wasconsidered to be the country where entire goods had been manufactured or where they had undergonesufficient processing.
95. The representative of Armenia added that the Customs Code incorporated relevant provisions
regulating the field of rules of origin.  The Cust oms Code was in full conformity with relevant WTO
provisions.  In particular the precise definitions of goods that were to be considered as being whollyobtained in one country, criteria of sufficient processing in terms of change of tariff classification andthe value added percentage criterion; and minimal operations or processes that did not by themselves
confer origin to goods were given.  According to  Article 160 of the Republic of Armenia’s Customs
Code the following goods should be deemed as wholly obtained in one country:
a) live animals born and raised in that country;
b) animals obtained by hunting, trapping, fishing in the territorial and internal waters of
that country or by performing other similar activities;
c) produce obtained from live animals in that country;
d) plants and plant products harvested, picked or gathered in that country;
e) minerals and other naturally occurring substances not included in items (a)-(d), which
are obtained from the territory, entrails or territorial and internal waters of that
country;
f) waste and recoverable resources derived from manufacturing and processing
operations or from consumption in that country and fit only for disposal or as raw
material;WT/ACC/SPEC/ARM/1/Rev.7
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g) products obtained by fishing in neutral waters by vessels lawfully flying the flag of
that country;
h) produce made from the products referred to in (g) on board of the country's factory
ship;
i) products obtained on board of a spaceship owned or rented by that country pending
the flight;
j) goods obtained or produced in that country solely from products referred to in items
(a)-(i).
96. He further added that according to Article 161 of the Customs Code, where more than one
country were concerned in the production of the good, the country of origin of a good would be the
last country where the good has undergone significant processing. Criteria of significant processingwere defined as:
a) the processing operations, leading to a change in the four digit classification of goods;
b) processing operations, wherein the value of incorporated materials which originate in
the given country and the value  add up at least 30 per cent of the ex-works price ofthe manufactured goods, whereas indirect taxes, commissions, transport, insurance,
security and other similar costs are disregarded in the ex-works price.
In the case of goods which were classified as sets (goods in sets) or were viewed as such, paragraph 3
of Article 162 of the Customs Code provided that the origin of the goods, was the country where theset had been assembled or put together, if the overall value of the non-originating parts of the set didnot exceed 45 per cent of the value of the set.  According to Article 163 of the Customs Code, the
following should not be deemed as criteria of sufficient processing:
a) changes made exclusively in the meaning and end use of the goods, for instance the
modification of a minibus into a lorry and the like;
b) mere packaging, in any form, including bottling, wrapping and the like;
c) classification of incomplete goods under finished goods, or the classification of
finished, but not assembled products under assembled products pursuant to the rulesof the Harmonized System;
d) simple assembling operations, particularly, mere plugging together of units to form a
good classifiable in another heading, such as the joining of a monitor, CPU, keyboard
and mouse to the end of making a computer and the like;
e) the mere addition of preservatives;f) obtaining of goods classifiable under meat and meat offal, from the goods classifiable
live animals;
g) preparatory works for the sale or transportation of the goods (making into lots,
sorting, wrapping and the like),
h) necessary operations for the protection, transportation and storage of the products;
i) affixing of marks, labels or other distinguishing signs of the like on products or their
packaging;
j) obtaining of products through mixi ng of goods (components), whereas the
characteristics of these products little vary from the initial characteristics of the
components;
k) combination of two or more actions referred to in subparagraphs (a) to (j) above.WT/ACC/SPEC/ARM/1/Rev.7
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97. The representative of Armenia stated that Article 162 of the Customs Code set forth the
sequence of application of the rules of origin.  In  his view, the Customs Code's r, rules on rules of
origin did not pursue, directly or indirectly, any trade objectives,, nor  create obstacles for free trade,
in accordance with WTO provisions.  The representative of Armenia added that the provisions of the
Customs Code on rules of origin were applied to CIS imports as well as to imports of other countriesand that certificates of origin were accepted for imports from CIS countries as well as from non-CIScountries.  According to Article 168 of the new Customs Code the absence of a certificate of origin byitself could not be the only reason to deny the entry of the goods.  In his view, the provisions ofArticle 167 (Paragraph 2) of the Customs Code complied with the requirements of Article 2(h) andAnnex II, paragraph 3(d) of the WTO Agreemen t on Rules of Origin.  Article 169 contained
provisions on appeal against actions, inactivity a nd decisions of the State bodies and the officials
thereof in relation to the determination and confirmation of the country of origin.  That Article also
provided that the declarant might apply to the Superior Bodies or to court, if it did not agree with the
method of determination or confirmation of the count ry of origin of the goods.  The Superior Body
was required to  hear and determine  the request within one month and notify the applicant.
98. The representative of Armenia confirmed that from the date of accession its laws and
regulations on rules of origin would be in conformity with provisions of the Agreement on Rules ofOrigin and other WTO provisions including the requirements of Article 2(h) and Annex II, paragraph3(d).  In this regard, he also confirmed that for non-preferential and preferential rules of origin,respectively, the relevant Armenian authorities, or preshipment inspection authority acting on their
behalf, would provide, upon request of an exporter, importer or any person with a justifiable cause, an
assessment of the origin of the import and outline the terms under which it will be provided.
According to the provisions of the WTO Agreement on Rules of Origin specified above, any requestfor such an assessment would be accepted even before trade in the goods concerned began, and anysuch assessment would be binding for three y ears.  The Working Party took note of these
commitments.
- Pre-shipment inspection
99. In response to questions, the representative of Armenia stated that while the Government of
Armenia had announced an international tender to submit competitive bids for selecting a company in
charge of implementing pre-shipment inspection to imports from all directions in 1998, no agreement
was ever signed.  The representative of Armeni a further noted that the Government of ArmeniaWT/ACC/SPEC/ARM/1/Rev.7
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currently did not see any reason or need to employ pre-shipment inspection companies. and noted that
pre-shipment inspection was not in place in Armenia.
100. The representative of Armenia confirmed that his Government would ensure that the
operation of any future pre-shipment inspection syst em program would be applied in conformity with
the requirements of the WTO Agreement, in partic ular the Agreement on Pre-shipment Inspection, the
recommendations of the Working Party on Pre-sh ipment Inspection of 2 December 1997 and any
subsequent recommendations issued by that Working Party, the Agreement on the Implementation ofArticle VII (the Customs Valuation Agreem ent), and the Agreements on Import Licensing
Procedures, Rules of Origin, Implementation of  Article VI (Anti-dumping), Subsidies and
Countervailing Measures (SCM), Technical Barriers to Trade, Sanitary and Phytosanitary Measures,Safeguards, and Agriculture.  Armenia would ensure that any private firm performing customs dutiescovered by WTO rules would publish their practices and procedures as required by GATT Article X,that ruling by the firm would be advisory only to the Government of Armenia and would be
appealable to the Government and to the judiciary, that any rulings of general applicability would be
made available to WTO members and to importers and exporters upon request, and that Armeniawould, upon request of WTO Members, meet to discuss the activities of such firms and their impacton trade with a view to resolving problems. The representative of Armenia stated that any pre-shipment inspection system would be temporary until such time as the Armenian customs authorities
would be able to carry out these functions pr operly. The Working Party took note of these
commitments.
- Anti-dumping, countervailing and safeguards regimes
101. In response to questions, concerning whethe r Armenia had at present an anti-dumping,
countervailing or safeguards regime, the representa tive of Armenia stated that a  draft Law on Anti-
Dumping had been submitted to the National Assembly for adoption.  Safeguard Measures had beenestablished by the adoption of the Law on Protection of the Domestic Market (Safeguard Measures of18 April 2001).  The Law on Protection of Economic Competition had also been adopted (16November 2000), the purpose of which was to pr otect and promote economic competition and to
ensure an appropriate environment for fair competition.  These legislative acts have been drafted infull conformity with the relevant WTO provisions, including Articles VI and XIX of the GATT 1994and the Agreements on the Implementation of Article VI, the Agreement on Subsidies andCountervailing Measures and the Agreement on Safeguards.
102. The representative of Armenia confirmed that from the date of accession Armenia would not
apply any anti-dumping, countervailing or safeguar d measures until it had implemented and notifiedWT/ACC/SPEC/ARM/1/Rev.7
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to the WTO appropriate laws in conformity with the provisions of the WTO Agreements on the
Implementation of Article VI, on Subsidies and Countervailing Measures, and on Safeguards.  Aftersuch legislation was implemented and notifie d, Armenia would apply any anti-dumping duties,
countervailing duties and safeguard measures in full conformity with the these Agreements and other
relevant WTO provisions.  The Working Party took note of these commitments.
- Export regulations
- Export restrictions and export licensing system
103. The representative of Armenia stated that the Resolution No. 124, 29 December 1995 on
Non-Tariff Regulation of Commodities (Operations, Services) Imported and Exported from  theRepublic of Armenia regulated Armenia’s non-tariff measures on export, and operated as a form ofnon-automatic export licensing.  The export permis sion required by Armenia for export of certain
goods was justified under WTO provisions, eg., Articles XI, XX or XXI of the GATT 1994.Automatic export licences were also required for textiles (to the European Communities only). The
export licences on textiles were required pursuant to an agreement with the European Communities,
but no restrictions on these exports were currently in place. For medicines, and for certain liveanimals and plants, permission of the relevant authorities was required.  The permission formedicines, live animals and plants were  generally not restrictive - rather, they were designed toensure public health and safety. The exportation and importation of weapons; military technology andthe consumables necessary for its production; technologies equipment and locators of nuclearmaterials (including heating materials); special non-nuclear materials and services related to it; andionizing radiation sources were carried out throug h authorization issued by the Government of the
Republic of Armenia. All other products could  be freely exported from Armenia.  The system applied
to exports to all destinations, except in the case of the licensing requirement for exports of textiles and
clothing to the European Union.  The permission  requirements were not intended to restrict the
quantity or value of exports.  Rather, they were intended to protect the national interest and human,animal or plant life or health, and the environment.  The representative of Armenia stated that theGovernment did not consider that at this time, a better way existed of achieving these objectives.
104. The representative of Armenia noted that Ar menia’s non-tariff regulation system on export
closely paralleled that applied to imports. As on the import side, exportation of pharmaceuticals andrare animals and plants were subject to non-restrictive regulation, designed to protect health and theenvironment. Export permission procedures for pharmaceutical products were the same as import
permission procedures, and were regulated by the same Resolutions. Permissions were required for
exports of rare objects or artifacts considered part of the national heritage.  In addition, exports ofWT/ACC/SPEC/ARM/1/Rev.7
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textiles and clothing to the European Communities were subject to licensing under a bilateral
agreement with the European Communities. The licensing of textile and clothing e xports to the
European Communities allowed these items to be monitored, but they were not currently subject torestrictions of any kind.
105. The representative of Armenia said that Armenia maintained export permission requirements
on the following items:
Table Eight
HS number
Objects considered part of national heritage
Pharmaceutical products, medicines 051000; 1211; 2941; 3001; 3002; 3003; 3004; 3005;
300630 000; 300650 000; 300660; 380840;1108*; 1301; 1302; 1504; 152000 000; 1702; 1804;1805; 2207; 2209; 2501; 2520; 2712; 2801-2802;
280440 000; 281000 000; 284700 000; 285100;
2904-2909; 2912-2940; 2942; 3301
Rare wild animals and plants included in the RedBook of the Republic of Armenia
* 1108 and the following categories of products in the list used for pharmaceutical purposes, are subject to
import and/or export permission.
The Red Book of the Republic of Armenia identifie d approximately one hundred rare animals and birds,
and 390 rare plants, in respect of which permissi ons would be required and whose exportation could be
controlled.
106. The representative of Armenia stated that according to the Resolution No. 581, the
exportation of pharmaceutical products and medicine had to be permitted by the Ministry of Health ofthe Republic of Armenia.  According to Resolution No. 124, the exportation of rare wild animals and
plants included in the Red Book of the Republic of Armenia was carried out through permissions
issued by the Ministry of Nature and the Environment.   Exports of objects considered of interest to the
national heritage must be authorised  by the Ministry of Culture. In the case of textile and clothingexports to the European Communities, the Ministry of Trade and Economic Development would haveexclusive responsibility for issuing export licences. The  exportation of pharmaceuticals and/ormedicines could be refused if (a) there was incorrec t and/or insufficient information in the presented
documents, (b) the period of validity of the pharmaceutical products was exceeded, (c) the actualpharmaceuticals and (or) medicines did not correspond to the specifications stated in the importationdocuments, (d) the pharmaceuticals were not registered in Armenia, (e) the quality of the
pharmaceutical products did not correspond to quality standards accepted in the Republic of Armenia.
Unjustified delays and refusal to issue permission could give rise to judicial procedures.  The MinistryWT/ACC/SPEC/ARM/1/Rev.7
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of Trade and Economic Development could deny an export licence to an applicant in respect of
exports to the European Communities if exports of the items concerned were to exceed a certainquantitative limitation. Since this has not occurred so far, Armenia has not developed any mechanismsfor administering export quotas.
107. The representative of Armenia said that any persons, firms and institutions wishing to apply
for an export licence could  do so provided they were registered as a juridical person or a soleentrepreneur undertaking a business activity in Armenia. As in the case of the importation ofpharmaceutical products, to receive permission for exportation of pharmaceutical products the
following documents were required:  an application form, a certificate relating to the acquisition ofthe pharmaceutical products, a licence to trade in pharmaceutical products in Armenia, documentsrelating to the acquisition and sale of pharmaceutical products (contract, invoice, etc.), and acertificate of quality issued by the producer. Permissions were issued within ten days from the date ofthe application. Since the ten-day stipulation was a maximum period, in practice permission could be
obtained within a shorter period. An export permission would generally not be granted immediately
upon request, but in practice the necessary procedures could be completed within a day or two. Thefee for an export permission was equal one month’s minimum salary in the Republic of Armenia.Permissions were not transferable among exporters.  A permission application and/or an exportation
could be made at any time during the year.  Permissions were issued for a period of three months. Therefusal of permission for exportation could give rise to judicial  procedures.
108. The representative of Armenia confirmed that any export licensing requirements or other
export control requirements would be applied in conformity with WTO provisions including those
contained in Articles XI, XVII, XX and XXI of the GATT 1994.  The Working Party took note of this
commitment.
- Other measures
109. The representative of Armenia noted that in order to prevent exports at artificially low prices,
or the under-invoicing of exports, the Resolution 1 24 had established a list of minimum prices each
quarter for a list of selected commodities as a reference base for tax purposes. The reference priceshad been equally applied to all export destinations.  With effect from 29 December 1995, this list onlycovered ferrous and non-ferrous metals, (HS 72.00, 72.04, 74.0-74.14. 75. 76.0-76.14, 78.80, 81.01,81.13).  According to Resolution 124 commodities of the mentioned list could be exported at prices less
than the minimum established prices. However, the corporate tax liabilities of firms that export ferrous
and non-ferrous metals and scrap were calculated on the basis of these reference prices if the declared
export price was below the reference amount. In this case the exporter was required also to present theWT/ACC/SPEC/ARM/1/Rev.7
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certificate of conformity of the Agency of Standa rdization Measurement and Certification (SARM). The
Customs Bodies of the Republic of Armenia were re quired to  inform the Tax Inspectorate about the
transaction within a month.  At a later stage, the representative of Armenia informed the Working Party
that on 21 April 1999, the list of minimum reference prices was eliminated.
- Export subsidies
110. The representative of Armenia stated that Armenia did not offer export incentives or export
subsidies of any kind at the present time.  The Government believed that export expansion was vital toArmenia’s future economic viability.  For this reason, consideration was being given to various waysof stimulating exports, particularly through promotional activities.  The Government did not,however, intend to rely on export subsidies as part of an export expansion program.  Exportpromotion measures currently related mainly to the establishment and development of appropriateinstitutions infrastructure such as the Armenian Development Agency, which could support thebusiness community by providing such services as arranging trade fairs, promoting Armenia in the
international scene, provision of market information, conducting research activities aimed at
identifying sectors and products with export potential, etc.
111. The representative of Armenia confirmed that the Government did not maintain subsidies
which met the definition of a prohibited subsidy, wi thin the meaning of Article 3 of the Agreement on
Subsidies and Countervailing Measures, and did not seek transitions to provide for the progressiveelimination of such measures within a fixed period of time. He further stated that Armenia would notintroduce such prohibited subsidies in the future, and would apply export promotion measures inconformity with WTO requirements.  The Working Party took note of these commitments.
- Internal policies affecting trade in goods
- Industrial policy, including subsidies
112. The representative of Armenia stated that Armenia’s industrial policy aimed to ensure more
efficient use of domestic resources within a market-oriented framework.  A central policy objectiveaffecting industry was privatization.  Approximatel y 76 per cent of formerly public-owned enterprises
in Armenia were privatized and 24 per cent remained under State control.  The representative ofArmenia added that as a result of ongoing privat ization, as well as due to registration of newly
established private enterprises, the share of publi cly owned enterprises in Armenia gradually declined
to 8 per cent of the total by the end of 1997, and to further 7 per cent by the end of 1998.  At the endof 2001 the total number of legal entities existing in the Republic of Armenia was about 45,000, ofWT/ACC/SPEC/ARM/1/Rev.7
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which only 39 were wholly state-owned enterprises ( 100 per cent of the stock belonging to the State).
Correspondingly, the public-owned sector accounted for 57 per cent of industrial output by the end of1997, which declined further to 52 per cent of industrial output in the end of 1998.  In response toquestions the representative of Armenia stated that pending completion of the privatization program,
the Government required State-owned enterprises to operate according to market principles.
Enterprises in Armenia were required to acquire their inputs on the open market.  Most firms had notyet put proper market-economy accounting systems into use, but they were developing them.  Inresponse to requests for information concerning th e payment of direct subsidies, the representative of
Armenia stated that since the beginning of 1995, almost no direct subsidies have been granted to
industry.  In previous years direct subsidies had been provided on a fairly large scale viaconcessionary credits to firms.  He further noted that the Government in general did not retainproduction subsidies in the industrial sector.
113. The representative of Armenia said that the only beneficiaries of direct subsidies in 1995 were
the firms engaged in the production of strategic (military) equipment, for whom subsidies were
granted for further construction and the equipping of plant.  The beneficiary firms did not export theirproducts.  Any remaining indirect subsidies that might arise as a result of clearing arrangements weredisappearing because of the contraction (and eventual elimination) of inter-governmental clearingcontracts.   The procurement via State orders, which could also entail indirect subsidies, was beingreplaced by competitive tendering procedures, however, the Government maintained the freedom togrant certain privileges to domestic bidders.  In 1998 the Government recommenced the practice ofwrite-offs of tax fine arrears in order to support the rehabilitation and restructuring of a few selectedlarge enterprises, such as Armenmotor Company and Yerevan Jewellery Plant.  For analogous
purposes, tax fine arrears were written off for those enterprises which incurred indebtedness because
of default against shipments being made within  the framework of inter-governmental clearing
contracts and procurements via State orders.
114. The representative of Armenia further added that because the continuing reform of policies
might indirectly confer subsidies on industries, the Government also maintained a substantiallyderegulated business environment which, when combined with the Government's open investmentpolicies, meant that there were effectively no barriers to market contestability.  Firms were free toenter and exit sectors on the basis of their own market-based decisions.  Additional measures designedto safeguard and strengthen this business environment were the establishment of anti-monopoly and
bankruptcy laws. The Law on the Bankruptcy of Ba nks and the Law on the Bankruptcy of Juridical
Persons, of Enterprises Without the Status of a Juridical Person, and of Entrepreneurs entered intoforce respectively on 1 October 1996 and on 1 March 1997.WT/ACC/SPEC/ARM/1/Rev.7
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115. The representative of Armenia stated that the Government of Armenia would ensure that its
subsidy regime was in full conformity with the Agreement on Subsidies and Countervailing Measuresfrom the date of its accession to the WTO.  The Working Party took note of this commitment.
- Technical Barriers to Trade
116. The representative of Armenia noted that, after independence, Armenia took steps to establish
and develop its national systems of standardization, metrology and certification. Relevant lawsregulating those systems were the Law on Standardization and Certification and the Law onUniformity of Measurements accepted by the National Assembly on 30 April 1997.  The two lawsincorporated the core principles of the WTO TBT Agreement. The Law on Standardization andCertification provided the legal basis in the Republic of Armenia for the standardization as well ascertification of products, services, labour (processes) and quality systems. This was applicable to thebodies of State governance, enterprises, institutions and private entrepreneurs and defined the meansfor the protection of interests of consumers and the State through the elaboration and application of
normative documents on standardization. It also defined the rights, obligations and responsibility of
the participants in the certification process.
117. He further noted that the Law on Uniformity of Measurements defined the legal basis for
ensuring the uniformity of measurements, regulated the relations of the bodies of State governancewith enterprises, institutions and private entrepreneurs on issues relating to the production andissuance of measurement instruments, and the use and repairs thereof. It was directed at protecting therights and rightful interests of consumers and the State from the negative impact of inaccurate resultsof measurements. The Department for Standardizat ion, Metrology and Certification (SARM) was the
coordinator of standardization, meteorological and certification activities in Armenia, and its rights
and obligations were defined by the Law on Standardization and Certification and the Law on
Uniformity of Measurements. Being the national body in charge of the administration related tostandardization, certification and meteorology in Armenia, its responsibilities included the creationand administration of national standardization and certification systems; the adoption of nationalstandards and classifiers; the application of international standards; the publication of officialinformation in the fields of standardization and certification; accreditation of certification bodies andtesting laboratories; dealing with appeals and disputes on certification matters, etc.
118. He further added that SARM was presided over by the State Chief Inspector, whose rights
and obligations were contained in Article 23 of the Law on Conformity Assessment and Article 24 of
the Law on Uniformity of Measurements. SARM was a collegial body that took decisions by majority
vote.  In order to further strengthen the compliance of Armenia’s legislation with the principles of theWT/ACC/SPEC/ARM/1/Rev.7
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WTO Agreement on Technical Barriers to Trade two new laws were adopted by the National
Assembly on 9 December 1999: the Law on Standardization and the Law on Conformity Assessmentof Products and Services to the Normative Requirements (hereinafter Law on ConformityAssessment). Governmental Decree No 9 of 11 January 2000 on Preparation, Adoption and
Application of Technical Regulations was also adop ted. In his view, the definitions of standards and
technical regulations in these acts were in full compliance with the respective definitions in Annex 1
to the TBT Agreement. According to the Law on Standardization, implementation of standards wasvoluntary.  Standards become mandatory if they are referred to in technical regulations by exclusivereference.  Relevant Ministries should be responsible for the preparation of technical regulationsaccording to the Law on Standardization. Technical regulations shall be enacted at least two monthsafter their promulgation and notified to the relevant international organizations and national bodies.
119. In response to further questions, the representative of Armenia stated that the non-
discrimination principle, as it concerns the treatment of domestic and foreign products and services, as
well as the principle of equivalency with the regulations of other countries was reflected in Decree
No. 9, of 11 January 2000. Equivalent technical regulations from other countries could beincorporated into Armenian legislation to establish corresponding authorities which were responsiblefor setting up mandatory requirements for products and services.  International and regional standards,directives and guidelines should be taken into account when  elaborating national standards andregulations.  The Law on Conformity Assessment regulated the activities for voluntary andcompulsory conformity assessment of production, goods, labours and services to normativerequirements.  The Law also established the legal basis for State activity in that field, as well asdetermined the modalities for conformity assessmen t, conditions of product marketing and the rights
and obligations of parties to conformity assessment.  The three Laws currently in force (the Law on
Standardization, the Law on Conformity Assessment, the Law on the Uniformity of Measurements)serve as the legal basis for the development of  QSMCA (Quality Standardization, Metrology and
Conformity Assessment) policy, pursued by SARM.
120. He further added that the main principles of this policy were:
- harmonization of legislation in the field of standardization, metrology and conformity
assessment,
- ensuring the safety of products, processes and services through State regulating
mechanisms (technical regulations),
- harmonization of national standards with international, regional and interstate ones,
- direct implementation of ISO/IEC and Eu ropean (EN) standards in the field of
conformity assessment,
- widening the scope of cooperation with international organizations,WT/ACC/SPEC/ARM/1/Rev.7
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- improvement of relevant accreditation systems to comply with international rules and
procedures,
- providing uniformity of measurement through State regulation mechanisms,
- facilitating the removal of unnecessary barriers to trade, and
- ensuring the protection of consumers' rights.
SARM cooperated with the Ministries of Health a nd Agriculture in matters relating to sanitary and
phytosanitary measures.
121. The representative of Armenia added that the National Standardization System was
established with a mission to provide:
- the safety of products, labour (processes) and services to protect the natural environment,
human life, health and property;
- the technical and informative compatibility and inter-changeability of products;
- the improvement in quality of products, labour and services;
- uniformity of measurements;
- preservation of resources;
- the security of economic objects, in the event of the occurrence of technical and other
disasters and emergencies;
- the removal of technical barriers to trade;
- the essential conditions for the state of defence and mobilization readiness.
122. The representative of Armenia noted that the National Standards Institute (CJSC) was
established under the SARM to perform standardization activities.  The main provisions of that systemand its procedures for preparation, adoption and appl ication of Armenian sta ndards were established by
national basic standards of the AST 1 series.  About    230 Armenian standards had been developed by
the technical committees and adopted by SARM sin ce 1993.  The majority of the standards applied in
Armenia were international and regional standards.  More than 18,000 interstate standards of CIScountries are included in the national fund of standa rds.  Fifty per cent of national standards would be
aligned to international standards by the end of 2002.  The National Standards Institute publishes a
quarterly guide "Standards and Specifications", wh ich provides current information on technical
regulations and specifications and issues relating to standardization.
123. He further noted that the following were priorities in the field of standardization activities:
- establishment of quality and environment management systems’ normative base in
compliance with international standards,
- development of standards in the fields of military industry,
- standardization in the field of conservation of resources in fuel power engineering
systems,
- standardization of information technologies in compliance with international
standards,
- improvement of national metering standards base,WT/ACC/SPEC/ARM/1/Rev.7
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- personnel training and qualification improvement.
Priorities in the field of conformity assessment were:
- quality system introduction according to the requirements of ISO 9000 series
standards,
- environmental management system introduction according to the requirements of ISO
14000 series standards,
- reduction of the list of products subject to mandatory conformity assessment,
- development of the process of conformity assessment results mutual and partial
recognition,
- harmonization of conformity assessment rules and regulations with international
requirements,
- cooperation with internationally recognized organizations and companies in the field
of conformity assessment,
- improvement of accreditations system according to international requirements,
- development of systemized privatization procedures, certification bodies and test
laboratories.
For the preparation, adoption and application of standards, SARM  followed the TBT Code of Good
Practice and would sign it from the date of Arme nia’s accession to WTO. SARM was  cooperating with
standards organizations in other countries and was a member of the International Organization ISO for
Standardization from 1 January 1997. Presently SARM was a member of ISO and EASC, which
enabled Armenia to participate through technical co mmittees in the elaboration of international and
regional standards and to apply these standards in Armenia.  The only inquiry point operating in
Armenia and the only body responsible for notific ations  was SARM, which would implement the
obligations established in accordance with Article 10 of the TBT Agreement. According to Government
Resolution, SARM was nominated as an inquiry point.  The address of the inquiry point was:
Department for Standardizati on, Metrology and Certification
     under the Government of the Republic of Armenia
Komitasa ave, 49/2
375051, Yerevan
Republic of Armenia
Tel:  3741 235 861Fax:  3741 285 620
Email:  armstandard@sarm.am
Press@sarm.am
The notification activities were taken over by the WT O Notification Centre in the Republic of Armenia's
public institution, since 1 January 2001.
124. In response to questions concerning mandatory certification the representative of Armenia
stated that the Law On Conformity Assessment of Products and Services to the NormativeRequirements provided the legal basis for the conformity assessment of products, services, labourWT/ACC/SPEC/ARM/1/Rev.7
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(processes) and quality systems.  It defined the rights, obligations and responsibility of the
participants in the conformity assessment process.  The conformity assessment mechanisms werefixed in that Law. The use of less expensive and less trade restrictive methods of conformityassessment, as manufacturer’s declarations and conformity marks were also included in the Law.
According to the Law, a certificate on conformity and a registered declaration on conformity had the
same legal authority, and domestic and foreign manufacturers and service providers were grantedsimilar rights in applying declarations on the conformity of products or services.  Mandatorycertification activities are coordinated by SARM and conducted by the accredited certification bodiesand testing laboratories.
125. He further noted that the procedure for accreditation of certification bodies and testing
laboratories had been established in Decree No. 238 of 12 May 2000.  According to the Decreeaccreditation was carried out by the Council for Accreditation of Certification Bodies and TestingLaboratories in the field of Conformity Assessment.  Local and foreign bodies and laboratories had
the same rights to be accredited in the National System for conformity assessment.   Requirements to
certification bodies and testing laboratories had to correspond to  ISO/IEC 17025 and EN 45011, EN45012, EN 45002.  Taking into consideration the need to control the safety of certain products, labourand services for the protection of the national environment and human life and health, as well as theprotection of consumer rights, some products were subject to mandatory conformity assessmentaccording to Resolution No. 239 of 12 May 2000.  Those products were selected taking intoconsideration the reports received from the inspection bodies, the Ministry of Agriculture, theSanitary-Anti-epidemiological State Center, consumers, and based also on the data of researchinstitutes and laboratories.  Requirements for products covered by mandatory conformity assessment
in Armenia were kept to the minimum.  Mandatory certification procedures were the same for both
imported and domestic products.  Certificates were issued for product types based on testing ofsamples, analysis of production systems, quality system certification or declaration of suppliers
depending on the scheme of certification.  These internationally accepted certification schemes werefixed by AST 5.3.
126. The representative of Armenia also stated that pursuant to the Law on Conformity
Assessment, recognition of foreign certificates on conformity or conformity marks for products wasmade by bilateral agreement of the Republic of Armenia on mutual recognition of conformityassessment results or unilateral recognition.  Those procedures were regulated by Resolution No. 247
of 18 May 2000 of the Government of the Republic of Armenia.  According to the Resolution, in the
absence of mutual recognition agreement a decision on unilateral recognition of conformity was madeWT/ACC/SPEC/ARM/1/Rev.7
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by SARM.   Procedures on recognition of certificates issued by foreign certification bodies are
regulated by Resolution No. 247 of 18 May 2000 of the Government.
127. He further noted that SARM had signed cooperation agreements on mutual recognition of
conformity assessments with appropriate bodies of several countries such as Belarus, Georgia,
Kazakhstan, the Kyrgyz Republic, Moldova, the Russian Federation, Tajikistan, Turkmenistan,
Ukraine and Uzbekistan.  SARM was carrying out negotiations with appropriate bodies of other
countries, particularly with Bulgaria, China, India, Iran, Romania, the Slovak Republic and the UnitedStates, to sign similar agreements on cooperation.  In the absence of agreements on mutualrecognition, Resolution No. 247 of 16 May 2000, allowed for simplified procedures on acceptance ofcertificates and conformity marks issued by certifi cation bodies of other countries, if the Armenian
authorities were satisfied that conformity assessment procedures in those countries offered adequateassurance of conformity, and the safety requirements and norms conformed to those in force inArmenia.
128. In response to requests from members of the Working Party, the representative of Armenia
stated that a list of products subject to mandato ry conformity assessment were approved by Decree
No. 239 of 12 May, with amendments approved by  Decree No. 110 of 17 February 2001, Decree No.
297 of 12 April 2001 and Decree No. 825 of 6 September 2001.  The list of above-mentionedproducts is given in Annex I to this Report.  He noted that the following technical regulations hadentered into force:
- The Indexes of Safety, Methods of Testing of Internal Combustion Engine Fuels and
Requirements of Ensuring Safety in Phases of Their Maintenance, Handling,Realization and Usage and of Environment Conservation, approved by Order of
SARM on 15 June 2001. Those Indexes defined quality indexes characterising the
safety requirements for automobile petroleum, diesel and other engine fuels, as well
as requirements on ensuring safety in the phases of fuel maintenance, handling,
realisation and usage and on environment conservation.  The requirements forautomobile petroleum, diesel and other engine fuels were required to be  included in
their normative and technical documentation.
- Decree No. 41 of 15 January 2001 of the Government of the Republic of Armenia on
Establishing Safety Requirements to Condensed Explosive Products.  The Decree sets
a regulation for the condensed explosive products to meet the requirements defined inestablished national standards.
- AST 214-2001:  Condensed Explosive Products.  General Safety Requirement.
- GOST R 51271-99:  Condensed Explosive Products.  Method of Certification Test.WT/ACC/SPEC/ARM/1/Rev.7
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129. The representative of Armenia informed the Working Party that the following legislative acts
related to Technical Barriers to Trade were adopted and enacted in the Republic of Armenia:
Table Nine
Legislative Act Date of enactment
Law on Conformity Assessment of Products and Services to the
Normative Requirements03.12.99
Law on Standardization 03.12.99
Law on Uniformity of Measurements 30.4.97
130. The representative of Armenia confirmed that from the date of accession, Armenia would
accept conformance assessment certificates issued by internationally recognized authorities ofexporting countries with which Armenia had signed  mutual recognition Agreements, or approvals
provided by recognized independent conformity assessment bodies or agencies recognized by SARMwith respect to these requirements.  He further confirmed that after December 31 2004, only those
imports subject to technical regulations developed in accordance with Armenia's standardisation
regime would be subject to mandatory certifica tion.  Upon request of WTO Members,  Armenia
would meet to discuss these measures and their impact upon trade with a view to resolving problems.The Working Party took note of these commitments.
131. The representative of Armenia confirmed that Armenia would apply the WTO Agreement on
Technical Barriers to Trade from the date of accession without recourse to any transition period.  TheWorking Party took note of this commitment.
- Sanitary and Phytosanitary Measures
132. The representative of Armenia informed the Working party that the following legislative acts
related to Sanitary and Phytosanitary Measures were enacted in the Republic of Armenia:
Table Ten
Legislative Act Date of Enactment
Armenian Law on Veterinary 26.10.99 by National Assembly
Armenian Law on Plant Protection and Plant Quarantine 20.3.2000 by National Assembly
Armenian Law on Food Safety 08.12.99 by National Assembly
133. The representative of Armenia stated added that SARM cooperated with the Ministries of
Health and Agriculture in matters relating to sanitary and phytosanitary measures. Having theWT/ACC/SPEC/ARM/1/Rev.7
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objective to protect human health, safety and environment, the Government of Armenia had
introduced a list of goods, some of which fell within the scope of the SPS Agreement, subject tomandatory certification (Resolution 15 of 16 June 1998, replaced by Resolution No. 239 of12 May 2000, with amendments).  In his view this was evidence of the fact that Armenia had started
the process of elaboration of Sanitary and Phytosanitary Measures. In 1996, the National Assembly
adopted the Law on State Agrarian Inspections. The law defined the legal, economic and organisation
principles of State Agrarian Inspec tions in the Republic of Armenia.  In particular, Articles 6 and 7 of
the Law outlined the activities of the State Inspection Service of the Ministry of Agriculture, concerning
cultivation of lands, use of fertilizers, the struggle against plant diseases, insects and weeds,transportation of toxic substances and mineral fertil izers, conditions of conservation and destruction, as
well as livestock breeding with resp ect to veterinary services.  A ccording to Resolution No.17 of the
Government (11 March 1998) the "National Agrarian Ru les" were established.  Those Rules  dealt with
the protection of the population from diseases co mmon to man and animals, the prevention and
eradication of contagious and non-contagious anim al diseases, transportation, conservation, use and
destruction of veterinary medicamen ts and disinfectants.  The list of plant pests, weeds and diseases of
quarantine significance for the Republic of Armenia was also established by this Resolution.
134. He further added that for the implementation of  the Law on State Agrarian Inspections,  a Law
on Plant Protection and Plant Quarantine , as well as a Law on Veterinary have been established.  The
Law on Plant Protection and Plant Quarantine defined the legal, ec onomic and organisation principles of
the State Services of Plant Protect ion and Plant Quarantine of the Re public of Armenia, and regulated
relations between farms, enterprises, organizations and individuals within the territory of the Republic
of Armenia.  The Law regulated phytosanitary controls during importation/exportation of plants or
products of plant origin.  The main concepts and requirements of the International Plant Protection
Convention were taken into account in the Law.  The Law also permitted the taking into considerationof the phytosanitary conditions and requirements of an importing country when issuing phytosanitarycertificates.  The Law on Plant Protection and Plant Quarantine was enacted on 20 March 2000.
135. The Law on Veterinary Medicine defined the legal, economic and organisation principles of
the State Service of Veterinary Medicine of the Republic of Armenia, fixed the regulation for theprevention of diseases of animals, for the protection of the population from diseases common to manand animals, and provided the population with quality products according to veterinary and sanitaryconditions. The law regulated relations between the State body in charge of veterinary medicine and
enterprises, organizations, entrepreneurs, and indivi duals in the territory of the Republic of Armenia.
The law established procedures of state veterinary  inspection during importation/exportation of animals
and products of animal origin.  Armenia had been a member of the International Epizootic Office sinceWT/ACC/SPEC/ARM/1/Rev.7
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December 1997 and followed guidance and standards of that organization.  In his view, both Laws
were compatible with the requirements of the SPS Agreement.
136. The representative of Armenia informed the Working Party that Armenia was a member of
the International Codex Alimentarius commission an d would  follow its standards and guidance in
establishing procedures on food safety.
137. He further noted that a critical document in Armenia's sanitary rules and norms system was
the so called SanPins (Sanitary and Hygienic Rules and Norms), issued by the Ministry of Health ofthe Republic of Armenia.  The SanPins established limits on the amounts of toxic compounds,additives, contaminants in the food and foodstuffs and were based on scientific data and riskassessments conducted by research institutes.  The Food Safety Law provided stabilization relating tofood activities, particularly concerning the production and reproduction, importing, exporting,exchanging, keeping, packaging, selling as well as usage of products.
138. The representative of Armenia confirmed th at upon accession to the WTO, Armenia would
apply its sanitary and phytosanitary requirements consistently with the requirements of the WTO
Agreement, including the Agreements on Sanitary  and Phytosanitary Measures and Import Licensing
Procedures without recourse to any transition period.  The Working Party took note of this commitment.
- Trade-Related Investment Measures (TRIMs)
139. The representative of Armenia stated that Armenia did not maintain measures that were not in
conformity with the Agreement on Trade-Related Investment Measures and would apply the TRIMs
Agreement from the date of accession without recourse to any transitional period.  The Working Partytook note of this commitment.
- State Trading Enterprises
140. The representative of Armenia stated that the State monopoly over foreign trade of the
Former Soviet Union was abolished in 1989, and was replaced by a registration requirement for theconduct of such activity.  By a decree of the President of the Republic of 4 January 1992 entitled OnForeign Economic Activity, all enterprises registered and operating in the territory of Armenia,regardless of their form of ownership, had the right to conduct foreign economic activity, and are not
subject to any additional registration requirements.WT/ACC/SPEC/ARM/1/Rev.7
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141. Some members of the Working Party stated that, in their view, certain telecoms enterprises
were engaged in State-trading pursuant to Article XVII of the GATT 1994.  In response, therepresentative of Armenia stated that, based on the definition of State-trading set out in theInterpretation of Article XVII of the Genera l Agreement on Tariffs and Trade 1994, Armenia
maintained one State trading enterprise in the telecommunications sector. Basic telecommunication
services, mobile and international data transmission and value-added services had been reserved toArmentel, a joint-stock company owned by the Government of Armenia and a foreign private
supplier, in exchange for commitments by Armentel to develop Armenia’s telecommunicationsinfrastructure.
142. In response to questions whether Armenia intended to report its State monopoly of natural gas
distribution under Article XVII, the representative of Armenia replied that Armgas had not beengranted exclusive or special rights or privileges in the market for natural gas distribution.   TheArmenian network of gas distribution was privatised, resulting in the establishment of
"ArmRusGasArd" CSC.  This did not prevent any other entity with majority private ownership from
purchasing gas or from involvement in gas distribution.
143. The representative of Armenia confirmed that his Government would apply its laws and
regulations governing the trading activities of State-owned enterprises and other enterprises withspecial or exclusive privileges and would otherwise act in full conformity with the provisions of theWTO Agreements, in particular Article XVII of the GATT 1994 and the Understanding on thatArticle; and Article VIII of the GATS.  The Working Party took note of these commitments.
- Free zones, special economic zones
144. The representative of Armenia stated that Armenia did not maintain any free trade zones in
which special duty privileges of any kind were granted.  Armenia had, however, established a Frontier
Trade Area in the Meghri Region, on the border with Iran.  The Frontier Trade Area was establishedto promote trade between Armenia and Iran.  U nder the arrangement, Armenian enterprises were
encouraged to establish a presence in the border area and Iranian enterprises were encouraged to dothe same on their side of the frontier.  Forty citizens from each country were entitled to freely entereach other’s border areas in order to explore business and trading opportunities, but no specialcustoms regime or privileged duty treatment was asso ciated with any exchanges agreed on the basis of
these contacts.
145. The representative of Armenia confirmed that if Armenia established any free zones or
special economic areas, it would administer any such areas in compliance with WTO provisions,WT/ACC/SPEC/ARM/1/Rev.7
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including those addressing subsidies, TRIMs and TRIPS and that goods produced in these zones
under tax and tariff provisions that exempt imports and imported inputs from tariffs and certain taxeswould be subject to normal customs formalities when entering the rest of Armenia including theapplication of tariffs and taxes.  The Working Party took note of these commitments.
- Government procurement
146. The representative of Armenia informed the Working Party that government procurement in
Armenia had previously been governed by Gove rnment Resolution number 67 of 8 February 1995
"On the State Procurement Order of the Republic of  Armenia".  Pursuant to that Resolution, when
government entities wished to procure goods, they could do so either through any procurement agentor directly from the marketplace on their own beha lf. No procurement entity, either State-owned or
private, enjoyed special rights or privileges.  All interested parties could participate in procurementactivities under the common rules.  These purchases, which were given effect through State Orders,were financed directly from the budget, and involved the acquisition of goods and services by
government entities for their own consumption (i.e. not for resale or use as inputs into production).  In
the past, these arrangements had sometimes invo lved implicit subsidy elements for the suppliers
concerned, since prices under State Orders had not necessarily corresponded to market prices.
147. The representative of Armenia informed the Workin g Party that in its efforts to bring internal
legislation into full compliance with WTO regulati ons, the Government had initiated the adoption of the
Law on Procurement, which was adopted by the Parlia ment on 5 June 2000, and signed by the President
on 19 June 2000.  As required by the Law the State Pr ocurement Agency was established as the single
agency responsible for Government Procurem ent (in excess of Armenian Dram 250,000) from 2001
onward.  For the 2000 budget all Government procurement was made in a non-centralized manner,
while all agencies made their procurements according to the regulations specified in the Law.  The Law
defined clear and transparent procurement rules and regulations which are in conformity with the WTO
Agreement on Government Procurement, in partic ular the national treatment and non-discrimination
principles are guaranteed in conformity with Article III of the Agreement on Government Procurement.
148. The  representative of Armenia stated that the Government of Armenia had decided to
commence negotiations to join the Agreement on Government Procurement from the date of
accession. In this connection, Armenia would request observer status in the Committee onGovernment Procurement prior to accession to the WTO and would submit an entity offer withinthree months of accession to the WTO.  He also confirmed that, if the results of the negotiations were
satisfactory to the interests of Armenia and other members of the Agreement, Armenia wouldWT/ACC/SPEC/ARM/1/Rev.7
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complete negotiations for membership in the Agreement by [31 December 2003].  The Working Party
took note of this commitment.
-T r a n s i t
149. The representative of Armenia stated that Armenia permitted unimpeded and tax-free transit
of goods through its territory, with the exception of those goods whose importation was prohibited,
i.e. weapons, components used in the production of weapons, explosives, nuclear materials, poisons,narcotics, strong psychotropic substances, devices for use in opium smoking, and pornographicmaterial.  Thos items would only be allowed to be transit through the Republic of Armenia’s territorywith the explicit consent of the Government of Armenia.  Transit goods remained under customscontrol while they on the Republic of Armenia’s territory.
150. He further added that the  Customs Code implemented on 1 January 2001 regulated transit
trade.   According to Article 27 of the Customs Code, within the framework of the transit shipment
regime, customs charges were not levied, except for the customs fees and other fees in cases foreseen
by law.  Non-tariff measures were not applied, except where otherwise prescribed by the Code or
other laws and international treaties to which the Republic of Armenia was a party.  Armenia was aparty to a plurilateral agreement on transit trade within the framework of the CIS EconomicCooperation Treaty.  This agreement provided that signatories should not tax or impede transit tradethrough their territories.  Armenia had also signed a bilateral agreement on this subject with Georgia.Similar agreements with Iran and the Ukraine were under consideration.
151. The representative of Armenia confirmed that the Government would apply the laws and
regulations governing transit operations and would act in full conformity with provisions of the WTOAgreement, in particular with Article V of the GATT 1994.  The Working Party took note of this
commitment.
- Agricultural policy
152. The representative of Armenia said that as in the case of the industrial sector, the Government
of Armenia did not maintain State planning of any kind in the agricultural sector. The representativeof Armenia added that in the past the Government of Armenia did not consider direct subsidies as a
part of the development program of the agricultural sector. The Government provided some indirectsubsidies, and the main types of support to the agriculture sector included the following: coveringelectricity charges on irrigation water supply; provision of low-interest loans to farmers and taxexemptions (particularly exemption of VAT for producers of basic agricultural products).    There hadWT/ACC/SPEC/ARM/1/Rev.7
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been some provision of cereal seeds through "seed -loans" in the past.   In addition, the Government
supported a range of activities dedicated to reparation of the irrigation network, to restructuring offinancial and communication infrastructures, to training farmers in improved agricultural techniques,to upgrading seed and livestock quality, to conducting pest and disease control, and to providing
technical advice and extension services. In his view, those measures fit with the green box of
domestic support tables as far as the provided services were available to all farmers and involvedbudgetary outlays.  The Government intended to further increase direct support to agriculturalproducers.  He further added that the support provided to agricultural producers was aimed to assistfarmers to overcome structural and operational difficulties during the transition towards a marketoriented economy.
153. He further noted that in contrast to the relatively slow pace of industrial reform, Armenia had
privatized almost 70 per cent of agricultural land, and made land titles freely transferable. Informationon Agricultural supports was submitted to the Working Party.
154. The representative of Armenia stated that Armenia would forego have recourse to subsidies
provided for under Article 6.2 of the Agreement on Agriculture.  The Working Party took note of thiscommitment.
155. The representative of Armenia stated that for the purposes of Article 6.4(a) of the Agreement
on Agriculture, with respect to product-specific domestic support, the percentage of Armenia's totalvalue of production of a basic agricultural product during the relevant year, and with respect to non-product specific domestic support, the percentage of the value of Armenia's total agriculturalproduction, which would otherwise be required to be included in a Member's calculation of its CurrentAMS, would  be 10 per cent through to 31 December 2008.  Beginning on 1 January 2009 such
percentages for product-specific and non-product-sp ecific domestic support, which would otherwise
be required to be included in Armenia's calculation of its Current AMS, would  be 5 per cent.  [TheWorking Party took note of these commitments.]
156. The representative of Armenia added that as far as inputs were concerned, two large State
enterprises,  Hayagrospasarkum  (Armagroservice) and Hayberriutyun  (ArmProsperity) weredominant suppliers of agricultural services and inputs such as agricultural machines and spare partsthereof, seeds, chemicals and fertilizers. In 1996, 66 per cent of each of these enterprises had beenprivatized while 34 per cent had remained State-owned in the form authorized by the Ministry ofAgriculture (holding). Despite the fact that the competition remained somewhat constrained in the
input market, there were no restrictions to stop other suppliers from entering it. More new private
enterprises have been entering the market and increasing their market shares, particularly in theWT/ACC/SPEC/ARM/1/Rev.7
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market of fertilizers. This tendency was expected to be continued with the development of conditions
of competition in the market. He further added that those enterprises had no exclusive or special rightsor privileges granted by the Government of Armenia in the field in which they operated.
157. The representative of Armenia stated that Armenia would  eliminate the current VAT
exemption for producers of basic agricultural products from 31 December 2008, whereas the scope of
the exemption would  not be increased during the transition, nor would  the scope or amount of the taxexemption be restored if it was reduced during the transition.  The transition period would  terminateon 31 December 2008.  The VAT Law would  be amended accordingly.  The Working Party took noteof these commitments.
158. The representative of Armenia stated that  the Government of Armenia paid no export
subsidies on exports of agricultural products.  Acco rdingly the Government of Armenia would bind its
agricultural export subsidies at zero level in the relevant part of the Schedule of Concessions onGoods.  [The Working Party took note of this commitment]
V. TRADE RELATED INTELLECTUAL PROPERTY REGIME
159. The representative of Armenia stated that the first step in the direction of intellectual property
protection was the establishment of the Armenian Patent Office in 1992. Since December 1992, it hasbeen possible to file applications for patents in respect of inventions, and as from August 1993, afteradoption of the Law on Patents, to register utility models and industrial designs.  An applicant not anational of Armenia and not domiciled in Armenia must conduct his affairs through a patent attorneyregistered with the Armenian Patent Office.
- Intellectual property policy
160. In response to requests for information concerning the intellectual property policy of the
Government of Armenia, the representative of Ar menia stated that the Government of Armenia was
currently engaged in a substantial program of legislative reform.  During 1993-1994, the Armenian
Patent Office received some 3,000 applications for trade marks, service marks and appellations oforigin. From January 2000 to January 2002 the Armeni an Patent Office had received 296 applications
for inventions – of which 273 were submitted by local Armenians and 23 by foreigners, andapproximately 446 applications for trademarks according to National Procedure.  However, thereception of trademark applications for registration began after the issue of Resolution No. 4 of 19August, 1995, "On Confirmation of the Temporary Regulations for Trademarks and Service Marks"WT/ACC/SPEC/ARM/1/Rev.7
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and Patent Office Order of 24 October 1995, "On re-registration of former Soviet Union valid
certificates for trade and service marks".
161. He further noted that in May 1997, the Armenian National Assembly had adopted the Law on
Trade and Service Marks and Appellations of Origin of Goods, and the Law on Trade Names. The
provisions of the adopted statutes were fully consistent with international norms in this area. A
distinctive feature of the first of these Laws was the legal equality established between trademarks andservice marks.  The representative of Armenia confirmed that the following legislative acts related tointellectual property protection were currently enforced in the Republic of Armenia:
Table Eleven
Legislative act Date of enforcement
1. Armenian Law on Patents 25. 8.93
2. Armenian Law on Copyright and Related Rights 31.5.96
3. Armenian Law on Advertising 31.5.96
4. Armenian Law on Trademarks, Service Marks and Appellations of Origin of
the Goods21.6.97
5. Armenian Law on Trade Names 1.7.97
6. Armenian Law on Topographies of Integrated Circuits 14.3.98
7. Civil Code 1.1.99
8. Civil Procedure Code 1.1.99
9. Criminal Procedure Code 12.1.99
The representative of Armenia stated that the following legislation related to intellectual property
protection, (which included either amended or original legislation) had been prepared and enactedwith the aim of bringing Armenia's intellectual property protection regime into conformity with WTOrequirements.
Table Twelve
Legislative actDate of
EnforcementCoverage
Law on Patents of the Republic of Armenia (new) 16.12.99 (Articles 27, 30, 31, 34  of
the TRIPS Agreement)
Law on Copyright and Related Rights (new) 20.01.00 (Articles 12, 14ter of the
Berne Convention andArticle 10 of the TRIPS
Agreement)
Law on Trademarks, Service Marks and Appellations of
Origin of the Goods (new)20.01.00 (Articles 5 (C), 6bis, 6septies,
10 of the Paris Conventionand Articles 15, 16,17,19,22, 23, 24, 46, 47  of theTRIPS Agreement)
Law on Trade Names 15.10.99 (Article 8 of the Paris
Convention)WT/ACC/SPEC/ARM/1/Rev.7
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Legislative actDate of
EnforcementCoverage
Amendments to Civil Code 14.3.2000 (Articles 17, 22, 30, 39 of
the TRIPS Agreement)
Amendments to Civil Procedure Code 24.10.00 (Articles 42, 46, 47, 50 of
the TRIPS Agreement)
Amendments to Criminal Procedure Code 5.4.2000 (Articles 46, 47, 50, 61 of
the TRIPS Agreement)
Armenian Law on Selection Achievements 27.12.2000 (related to the protection of
plant varieties. Article 27 ofthe TRIPS Agreement)
Armenian Law on Protection of Economic Competition(including the regulation of unfair competition and
protection of undisclosed information)15.12.2000 (Articles 10bis, 10ter of the
Paris Convention and Article
39, 40 of the TRIPS
Agreement)
Customs Code 01.01.2001 ("Special Requirements
related to Border Measures"provided by Section 4, PartIII of the TRIPS Agreement)
162. The representative of Armenia stated that the Criminal Code, (implementing Articles 10bis,
10ter of the Paris Convention and Articles 46, 47, 50, 61 of  the TRIPS Agreement), would be
implemented from the date of Armenia's accession to the WTO.  The Working Party took note of that
commitment.
- Responsible agencies for policy formulation and implementation
163. The representative of Armenia said that policy formulation and implementation in the field of
industrial property (patents, utility models, industrial designs, trademarks and service marks, tradenames, layout designs of integrated circuits and appellations of origin) and copyrights was theresponsibility of the Armenian Intellectual Property Agency acting within  the  Ministry of Trade andEconomic Development. The Intellectual Property Agency was responsible for approving industrialproperty right applications, maintaining the State Register of industrial property rights, issuing anofficial bulletin reflecting its decisions, and coop erating with foreign institutions and international
organizations. The Intellectual Property Agency was also responsible for the regime covering
trademarks.
- Participation in internationa l intellectual property agreements
164. The representative of Armenia stated that  on 22 April 1993, Armenia became a Member of
the World Intellectual Property Organization (W IPO).  On 17 May 1994, Armenia also deposited a
declaration of continued application of the Paris Convention for the Protection of Industrial Property,the Madrid Agreement Concerning the Internationa l Registration of Marks and the Patent CooperationWT/ACC/SPEC/ARM/1/Rev.7
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Treaty.  On 27 February 1996 Armenia became a Member of the Eurasian Patent Organization.  The
National Assembly of the Republic of Armenia ratified the Protocol relating to the Madrid Agreementconcerning the International Registration of Marks on 5 April 2000 and the Berne Convention for theProtection of Literary and Artistic Works on 3 May 2000.  Draft legislation concerning Armenia's
accession to the Rome Convention for the Protection of Performers, Producers of Phonograms and
Broadcasting Organizations and the Geneva Convention for the Protection of Producers of
Phonograms Against Unauthorized Duplication of their Phonograms recently passed its first readingin the National Assembly of the Republic of Armenia.
- Application of national and MFN treatment to foreign nationals
165. Some members of the Working Party noted that although the representative of Armenia had
stated that foreigners enjoyed national treatment in both civil and criminal procedures before thecourts, its replies to questions concerning administ rative review proceedings,  dealing with the powers
of judicial branches of government, suggested that the jurisdiction of economic courts was not
available to foreigners from outside the CIS.  In response, the representative of Armenia stated that all
persons  enjoyed equal rights under the law, for example, the Law on Patents provided that allforeigners enjoy the same rights as nationals of Armenia in relation to all patent matters, includingprotection of patents and legal remedies against in fringement. The  Law on Trade and Service Marks
and Appellations of Origin of Goods, and the Law on Trade Names similarly envisage full nationaland MFN treatment for foreigners. This was also the case with respect to the Law on Copyright, andany future laws and regulations adopted in the sphere of intellectual property protection.
- Fees and taxes
166. The representative of Armenia stated that fees were payable upon filing of an application and
granting of a patent.  Similar arrangements were in place for trademarks and service marks. All fees
were set so as to be limited in amount to the approximate cost of services rendered, and the grantingand protection of intellectual property rights was not subject to taxation, as any fee was collected onbehalf of the budget.  The fees for legal protection of Industrial property, established by the Law onState Duty of the Republic of Armenia, were id entical for resident Armenians and non-residents.WT/ACC/SPEC/ARM/1/Rev.7
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- Substantive standards of protection, including procedures for the acquisition and
maintenance of intellectual property rights
- Copyright protection
167. The representative of Armenia stated that the National Copyright Agency was established in
1993. More than 2,000 authors and their artworks were registered with the Agency.  In the framework
of its activities the Agency also registered those organizations which made use of artworks, such astheatres, concert organizations, or organizations using works of arts and crafts for industrial purposes.Copyright policy implementation was the responsibility of the National Copyright Agency, whichregistered copyrights, assisted individuals to secure copyrights, provided advisory services, andcollected and paid royalties due to authors and their successors in title.  From March of 2002 theNational Copyright Agency operated within the Armenian Intellectual Property Agency.
168. The representative of Armenia added that in accordance with the Law on Copyright and
Related Rights, which was adopted by the National Assembly in May 1996, the National Copyright
Agency provided protection for copyrights in the territory of Armenia.  The new Law on Copyright
and Related Rights had been elaborated in accordance  with the provisions of the Bern Convention on the
Protection of Works of Art and Literature and entered into force on 20 January 2000.  It provided
protection for the property rights of computer progra ms and compilations of data, as well as for related
rights, i.e., the rights of phonogram and videogram producers and broadcasting and television stations,
as protection of pre-existing copyrighted works a nd sound recording national treatment protection for
works and sound recording.
- Trademarks, including service marks
169. The representative of Armenia informed the Working Party that in May 1997, the Armenian
National Assembly adopted the Law on Trade and Service Marks and Appellations of Origin of
Goods and the Law on Trade Names which came into force in July 1997.  As mentioned earlier, adistinctive feature of the first of these Laws was the legal equality established between trademarks andservice marks.  The Law set out the terms and conditions of trademark protection, the kinds oftrademarks that may not be registered, the procedures for registering trademarks, the rights of appealagainst decisions relating to trademarks, the circumstances in which trademarks may be used, and thedocumentary requirements for registering a trademark.  Trademark protection was granted for 10years, renewable for successive periods of 10 years.  He stated that in his view, the provisions of theLaw were in full conformity with Articles 15, 16.1 and 17–21 of the TRIPS Agreement.  In response
to further questions, the representative of Armenia stated that as regards the provisions of ArticlesWT/ACC/SPEC/ARM/1/Rev.7
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16.2 and 16.3 of the TRIPS Agreement concerning well-known trade and service marks, these were
also taken into account in the Law on Trade and Service Marks and Appellations of Origin of Goods(unlike the former Resolution No. 4 of 19 August 1995), and they were fully reflected in the new Lawon Trademarks, Service Marks and Appellations of Origin of the Goods which had entered into force
on 15 April 2000.
- Geographical indications, including appellations of origin
170. Some members of the Working Party asked how Armenia would protect geographical
indications under the Law on Trade and Service Marks and Appellations of Origin of Goods, andwhether that legislation would be in conformity with Articles 22 to 24 of the TRIPS Agreement. Therepresentative of Armenia stated that although geographical indications had not explicitly mentionedin Resolution No 4 of 19 August 1995, nor in the former Law on Trade and Service Marks andAppellations of Origin of Goods of 1997, Articles  22 to 24 of the TRIPS Agreement were now fully
reflected  in the Law on Trademarks, Service Marks and Appellations of Origin of Goods of 15 April
2000. The relevant provisions in that Law had been developed in compliance with the provisions of
the Paris Convention (Articles 1(2), 10, 10 ter, 10bis, 6quinquies  B.3), the Madrid Agreement on the
Repression of False or Deceptive Indications of S ource on Goods (Articles 1(1), 1(2)), and the Lisbon
Agreement for the Protection of Appellations of Origin and their International Registration (Articles2(1), 2(2), 3, 6).
- Industrial designs
171. The representative of Armenia stated that industrial designs were protected by the Law on
Patents of 1993.  In particular, the articles of the Law which established the necessary conditions forpatentability of industrial designs, were consistent with Articles 25 and 26 of the TRIPS Agreement.
In response to requests for information concerning the specific protection for textile designs provided
for in Article 25(2) of the TRIPS Agreement, the representative of Armenia stated that although
textile designs were not explicitly mentioned in Article 8 of the Law on Patents of 1993 (Article 6 ofthe new Law on Patents of 1999), they were nevertheless covered under that provision. There wasalso a similar reference in Article 1.1.3 of the Rules of Drawing Up, Filing and Consideration of
Applications for Industrial Design adopted on 31 August 2000.
-P a t e n t s
172. The representative of Armenia said that the owner of a title deed (title of protection patent or
certificate) for invention or industrial design granted by the Patent Office of the Soviet Union, andWT/ACC/SPEC/ARM/1/Rev.7
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which was still current, could file with the Armenian Patent Office for an Armenian patent at any time
during the validity period of the exclusive rights (20 years after the initial filing). In the ten-year
period to 1990, residents of Armenia registered 6,000 in ventions with the Patent Office of the Soviet
Union. The Law on Patents specified the nature of patentable subject matter, the conditions for
patentability, the rights of patent holders, the conditions of compulsory licensing, the procedures for
granting patents, and dispute settlement.
173. The representative of Armenia stated that the Law on Patents was adopted in August 1993.
Under the law, patents were granted for inventions, utility models and industrial designs. The term ofpatents for inventions was 10 years for preliminary patents, which were granted on the basis of apreliminary examination of the invention, and 20 year s when the patent was granted on the basis of a
substantive examination (principal patent).  These periods were counted from the date of filing.Patents for inventions were granted subject to requirements that the object of the patent was new,involves an inventive step and was capable of industrial application, and that no conflict arose with
respect to public order and security, good morals and law.
174. He further added that the patent application was subject to formal examination which was
required to  be carried out within two months from the filing date.  If the application satisfied theformal requirements, it was laid open to public inspection for a period of four months from a date ofpublication, after which a preliminary patent could be granted.  A principal patent was granteddepending on the results of substantive examination, which was  carried out upon request of theapplicant or any other interested party.  The request was required to be filed within seven years of thedate of filing of the patent application.  The request for substantive examination could be submittedwithin one year after the expiration of the said seven-year period, providing the person requesting
review paid an additional fee.
175. Some members of the Working Party asked whether  Armenia's Law on Patents was in full
conformity with Articles 27 to 34 of the TRIPS Agreement, and requested further information on theconformity of Armenia's system of compulsory licen sing.  In response, the representative of Armenia
said that in the interest of national security and in the public interests or in situations of emergency inthe Republic of Armenia, as well as in instances of public non-commercial use, the Government of the
Republic of Armenia was empowered to use or authoriz e third parties to use an invention, utility model
or industrial design without the consent of the pa tent owner (compulsory licence), provided the patent
owner was notified within 10 days and paid adequate remuneration taking into account the
circumstances of each case and the economic value of such authorization
.WT/ACC/SPEC/ARM/1/Rev.7
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176. The representative of Armenia stated that the new Law on Patents was in conformity with
Articles 27 to 34 of the TRIPS Agreement, and amendments concerning compulsory licensing wereadopted on 26 November 1999.
- Plant variety protection
177. Some members of the Working Party asked Armenia would ensure protection of plant
varieties.  The representative of Armenia stated that the Law on Selection Achievements, ensuring thesui generis  protection of plant varieties was adopted on 22 December 1999 and had entered into force
on 27 December 2000.
- Layout designs of integrated circuits
178. In response to questions concerning the system for protection of layout designs of integrated
circuits, the representative of Armenia stated that the Law on Protection of Layout Designs of
Integrated Circuits had been adopted on 3 February 1998 and entered into force on 14 March 1998.
- Requirements on undisclosed information, including trade secrets and test data
179. In response to requests for information concerning the protection of trade secrets and
undisclosed information in Armenia, notably in view of Article 39 of the TRIPS Agreement, therepresentative of Armenia stated that Armenia had incorporated provisions for the protection of tradesecrets and undisclosed information in its Civil Code (Article 141 and Chapter 68).  Legislation tocover the protection of undisclosed information in the form of the Law “On Protection of EconomicCompetition” covering both the regulation of unfair competition and protection of undisclosedinformation had entered into force on  15 December 2000.  By this Law the Agency of EconomicCompetition was established.  This Agency was also responsible for unfair competition.
- Measures to control abuse of  intellectual property rights
180. In response to a question, the representative of Armenia stated that appropriate measures to
prevent or control abuse of intellectual property rights were contained  in the  Law "On Protection ofEconomic Competition" that had entered into force on 15 December 2000.
181. The representative of Armenia also stated that, for the purpose of combating restraints on
trade and abuses of intellectual property rights, compulsory licensing was provided for under the Lawon Patents.  Article 16 of the Law on Patents stated that if an invention, a utility model or an industrialdesign were not used or were insufficiently used within four years from the date of filing anWT/ACC/SPEC/ARM/1/Rev.7
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application or three years from the grant of patent, any person who, on the expiry of the mentioned
term, wished to use the invention, utility model or industrial design, but had not succeeded inconcluding a licence contract with the patent owner, could submit a request for a compulsory licenceto the Government of the Republic of Armenia.  In this event, the licence would  be granted, provided
that the patent owner did  not furnish evidence stating valid reasons for not using or insufficiently
using the invention, utility model or the industrial  design.  Any dispute in respect of compulsory
licence granting and amounts, order and terms of payments was required to  be settled in the courts.
182. He further added that under the adopted Law on Trade and Service Marks and Appellations of
Origin of the Goods, at the request of any person trademark protection could be nullified by a courtdecision, if a trademark has not been used within fi ve years of the date of registration or preceding the
date of request for nullification.  A trademark owner has the right to defend the non-use of atrademark, and block a decision to remove the property right if the reasons for not using the trademarkwere beyond the control of the owner.
- Enforcement
- Civil judicial procedures and remedies
183. The representative of Armenia stated that civil court procedures were always available to deal
with legal matters relating to intellectual propert y protection. The courts were empowered to order the
payment of damages and court expenses. Other remedies envisioned in the TRIPS Agreement werealso within the decision-making authority of Armeni an courts.   In response to questions concerning
foreigners' rights to enforce intellectual property rights, and whether the remedies, procedures andpenalties were in conformity with Articles 42 to 49 of the TRIPS Agreement, the representative of
Armenia stated that the civil courts in Armenia were fully empowered to provide the remedies
referred to in the above mentioned Articles of the TRIPS Agreement.  Civil remedies could not be
ordered as a result of administrative procedures. Foreigners enjoyed the same rights as Armeniannationals in this area. Remedies against criminal behaviour were available under Armenia’s courtsand penal system. Foreigners had the same access to those remedies as Armenian nationals. TheGovernment was considering the amendment of existing legislation and introduction of additionallegislation containing remedies that were framed in more specific terms for the enforcement ofintellectual property rights. At a later stage, the representative of Armenia stated that the missingprovisions were included in the Civil Procedure and Criminal Procedure Codes, which was adoptedon 17 June 1998 and 1 July 1998 respectively and entered into force on 12 January 1999.WT/ACC/SPEC/ARM/1/Rev.7
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184. Some members of the Working Party asked whether Armenian judicial authorities had the
authority to order injunctions or provisional measures against infringement of intellectual propertyrights, as provided for in Articles 44 and 50 of the TRIPS Agreement, and whether administrativeauthorities enjoyed similar authority. In response the representative of Armenia stated that the judicial
authorities had the power to order injunctions or provisional measures.  Articles 15, 16 and 22 of the
new Law on Patents indicated the areas in which remedies may be sought through the courts in thearea of patent protection. Article 46 of the new Law on Trade and Service Marks and Appellations ofOrigin of Goods, as well as Articles 42 to 44 of the Law on Copyright and Neighbouring Rights
provided similar provisions in the case of trademarks, service marks, copyrights and related rights.
- Provisional measures
185. The representative of Armenia stated that the Courts of First Instance also had  authority to
take the provisional measures envisioned in Article 50 of the TRIPS Agreement.
- Administrative procedures and remedies
186. The representative of Armenia stated that civil remedies could not be ordered as a result of
administrative procedures in Armenia.
- Special border measures
187. Some members asked whether Armenia had a system of border enforcement against
intellectual property rights infringements in accordance with Articles 51 to 60 of the TRIPSAgreement.  The representative of Armenia replied that judicial authorities were empowered to takethe kinds of measures envisioned in Articles 51 to 60 of the TRIPS Agreement.  At a later stage, therepresentative of Armenia stated that full conformity  with the requirements of Articles 51 to 60 of the
Agreement on TRIPS had been achieved with the enact ment of Section 14 "Assistance of the Customs
Bodies in the Protection of Intell ectual Property Rights" of the Customs Code which entered into force
on 1 January 2001.
- Criminal procedures
188. The representative of Armenia stated that Article 140 of the original Criminal Code provided
that infringement of copyright, publication (disclosure) of an invention before the application filing,appropriation of invention’s authorship, as well as  coercion or inclusion into collaboration of persons
not participating in the creation of an invention, could be punished  by imprisonment for a period ofup to two years or by a fine in the amount of 10-20 times of the established minimal wage.  ArticleWT/ACC/SPEC/ARM/1/Rev.7
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157 of the same Code stated that deception of purchasers and customers was punishable by
imprisonment for a period of up to two years or by a fine not in the amount of 20-40 times of theestablished minimal wage.  In addition, as mentioned above, the additional provisions included in thenew Criminal Code, which entered into force on 12 January 1999.  Those provisions achieved
conformity with the provisions of Part III of the TRIPS Agreement.
- Laws, decrees, regulations and other legal acts relating to the above.
189. Some members of the Working Party stated that since 1992, Armenia had bilateral
commitments for the protection of intellectual property rights.  Those members stated that Armeniashould accelerate its legislative process to ensure the full implementation of the TRIPS Agreementfrom the date of its accession to the WTO.  In addition, some members of the Working Partyrequested clarification of the status of the draft Law on Trade Marks, Service Marks and Appellationsof Origin of Goods in Parliament, and whether the legislation was in full conformity with Articles 15to 21 of the Agreement on Trade-Related Aspects of Intellectual Property Rights.
190. In response, the representative of Armenia replied that on May 1997, the Armenian National
Assembly adopted the Law on Trade and Service Mark s and Appellations of Origin of Goods and the
Law on Trade Names and that the recently amended versions of those Laws were in full conformitywith Articles 15 to 21 of the TRIPS Agreement, including the rights specified in Article 16.
- Statistical data on applications for and grants  of intellectual property rights, as well as any
statistical data on their enforcement
191. In response to requests for information concerning the numbers of patent applications filed in
Armenia, the representative of Armenia stated  that during 1993-2001, 16,834 patent applications had
been filed with the Patent Office.  In 1,220 cases a decision for granting a patent was adopted, in 426
cases a patent was refused or the application was withdrawn, and 38 applications were under
examination.  During 1994-2001, 52 applications for obtaining industrial design patents were filed, 34from foreigners, and 42 applicants were granted a patent.  As regards trade and service marks andappellations of origin, after adoption of the La w on State Duty in September 1996, 7,088 applications
passed the preliminary examination and 6,506 trade and service marks were registered by theArmenian Patent Office.  During 1997-2001, 11 applications for appellations of origin had been filedwith the Patent Office and seven appellations were registered.  Under the new legislation more than2,000 authors, theatre and concert organizations had concluded contracts with the National CopyrightAgency.WT/ACC/SPEC/ARM/1/Rev.7
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192. The representative of Armenia stated that the Government of Armenia would apply the
provisions of the Agreement on TRIPS no later than the date of its accession to the WTO, withoutrecourse to any transitional periods.  The Working Party took note of this commitment.
VI. TRADE-RELATED  SERVICES REGIME- General
193. In response to questions, the representative of Armenia informed members of the Working
Party that Armenian laws and regulations, and th e policy framework did not generally distinguish
between trade in goods and trade in services.  The rights to trade were enshrined in the Civil Code ofthe Republic of Armenia, implemented on 1 January 1999.   All enterprises were required to beregistered and the register was open to public scrutiny.  Those requirements applied to all juridicalpersons, whether they were self-employed persons (individual entrepreneurs) or commercialorganizations.
194. Armenia's Schedule of Specific Commitments in Services is reproduced in Part II of the
Annex to the Protocol of Accession.
- Trade Agreements
195. Some members of the Working Party requested that Armenia provide detailed information on
the range of Free and Barter Trade Agreements to which Armenia was a party.  Other membersrequested information so that the Working Party could examine whether Armenia’s plurilateral andbilateral Free Trade Agreements were consistent with Article XXIV of the GATT 1994.
196. In response to these requests, the representative of Armenia informed the Working Party that
Armenia had developed a network of plurilateral and bilateral trade agreements with variouscountries.  A number of the arrangements were short-term in nature, designed to respond to particularneeds, other agreements were viewed as more durable, representing the Armenian Government’sperception of the directions in which future trade relations should develop.  As a member of the
World Trade Organization, Armenia would keep its bilateral and regional trade agreements under
review, not only to ensure legal consistency, but also to ensure the coherence of Armenia’s traderelations with a broad multilateral framework.WT/ACC/SPEC/ARM/1/Rev.7
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- Plurilateral or regional agreements
197. In response to further requests for information on Armenia's trade regional trade agreements,
the representative of Armenia stated that the Tr eaty of Economic Union was a framework agreement
signed by nine Heads of State of the Commonwealth  of Independent States (CIS) in 1993 (Azerbaijan,
Armenia, Belarus, Kazakstan, Kyrgyz Republic, Moldova, Russia, Tadjikistan, and Uzbekistan).  The
treaty envisaged that signatories would move towards the establishment of a customs union andcommon market among CIS countries, however, each signatory might exercise its own discretion on
the pace and timing of integration into economic structures of the CIS.  Other economic and financialcomponents of the CIS treaty related to a paymen ts union, cooperation on investment, industrial
cooperation, and an agreement on customs procedures.  The treaty set out quite specific commitmentsin many of these areas (as well as on cultural, scientific, and defence matters).  Because the treaty wasessentially an evolving framework document, it did not "operationalize" these commitments.  Instead,the specifics of preferential trading relationships were defined in bilateral free trade agreements and in
clearing agreements.
198. Also in response to requests for further information, the representative of Armenia explained
that Armenia was also a member of the Black  Sea Economic Cooperation (BSEC) Organization,
along with ten other countries (Albania, Azerbaij an, Bulgaria, Georgia, Greece, Moldova, Romania,
Russia, Turkey and Ukraine).  This agreement covered a number of fields, including economiccooperation and trade, investment, scientific and technical cooperation, the establishment of a BSECBank, and cooperation on transport and communications.  The agreement did not make any provisionfor preferential trade, although it envisaged the possibility of free trade zones in the future.  Moregenerally, the organization seeks to cement relations among neighbouring countries through
cooperation in such areas as transport, international payments and industrial development.
199. Some members asked whether Armenia had concluded an economic cooperation agreement
with the European Union.  The representative of  Armenia confirmed that the Partnership and
Cooperation Agreement between the European Union and Armenia had been signed on 22 April 1996,and entered into force on 1 July 1999.  The Agreement did not provide for any trade preferences.
- Bilateral free trade agreements and trade a nd economic cooperation agreements with CIS
countries
200. In response to questions of some members about Armenia's bilateral agreements with CIS
countries, the representative of Armenia stated that bilateral free trade agreements (FTAs) had been
signed with Belarus, Georgia, Kazakhstan, Kyrgyz Republic, Moldova, Russian Federation,WT/ACC/SPEC/ARM/1/Rev.7
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Tadjikistan, Turkmenistan and Ukraine.  The bilatera l free trade agreements had been ratified with the
Russian Federation (1993), Kyrgyz Republic (1995), Turkmenistan (1995), Georgia (1996), Ukraine
(1996), Kazakhstan (1999) and Belarus (2000) and became legally binding.  When the free tradeagreements were established and operationalized, tariffs were set up at zero level, and non-tariff
restrictions were eliminated. The representative of Armenia further responded that the FTAs had been
an outgrowth of the trade and economic cooperati on agreements that Armenia signed with CIS
countries.  Most of these early agreements were negotiated annually, they envisaged free trade andthey included lists of products that the parties agreed to trade with one another.  Particularly after1992 product lists tended to become indicative with no prior agreement on prices, and thecommitments were only partially fulfilled.  From 1995 the practice of product commitments waseliminated.  However, under the FTA with the Russia Federation, each party could exempt from dutyfree treatment any export items subject to quotas, licences and export taxes.  Since Armenia did notmaintain any export restrictions (other than those ge nerally applicable for public security, health and
safety reasons), there was nothing on Armenia’s exception list under the free trade agreement.  Russia
maintained certain export restrictions which could be covered by the exception provisions of the FTA,
but in practice, these often did not apply because of the trade and economic cooperation agreementsthat Armenia also signed annually with Russia.  No other exceptions to duty-free treatment forimports were contemplated in the Russian-Armenian free trade agreement.  Within the period aftersigning of a bilateral Free Trade Agreement with Armenia (1992-1997), the Russia Federation hadsubstantially liberalized its foreign trade (removed quotas, export taxes etc.).  Its legislation on tariffand non-tariff regulation of exports did not provide for a list of specific products.  This ensured theconformity of the FTA between Armenia and th e Russian Federation with the WTO rules on free
trade. The bilateral protocol, signed on 28 August 1997, confirmed the fact that substantial deviations
from the free trade regime between Armenia and Russia were eliminated.  There were no exemptionsfrom duty free treatment in the ratified bilateral agreements with Turkmenistan, Ukraine, Kyrgyz
Republic and Georgia.
- Bilateral clearing arrangements
201. In response to requests for information in relation to Armenia's barter trade agreements with
other countries, the representative of Armenia stated that barter was the essence of the remainingclearing arrangements maintained by Armenia.  Barter arrangements had been  The Government wascommitted to eliminating barter arrangements as soon as practicable and recognized that its role as
trader or as intermediary in trade inhibited the establishment of independent networks and contacts
with foreign buyers by enterprises which was an  essential determinant for exporting success.WT/ACC/SPEC/ARM/1/Rev.7
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202. In response to requests for amount of trade flow s arising from barter trade agreements,  the
representative of Armenia said that the 1993 clearing arrangements involved 74 per cent of totalexports and 56 per cent of total imports. The respective figures in 1994 were 46 per cent for exportsand 29 per cent for imports.  As far as transport and payments problems were being settled, the
importance of barter trade gradually decreased and by late 1995 deliveries under the clearing
arrangements were abandoned in practice.  In response to later requests for information  on existingbarter trade arrangements the representative of Armenia stated that in 1996 the Governmentannounced its intention to cease barter trade, and none of the former barter arrangements wasrecommenced. The Government of  Armenia did not envisage conducting barter or clearing
settlements in the future.
- Bilateral trade and cooperation agreements
203. The representative of Armenia also stated that trade and cooperation agreements had also
been signed with many non-CIS countries, including Argentina, Austria, Bulgaria, Canada, China,
Cyprus, European Union, Hungary, India, Ira n, Lebanon, Lithuania, Poland, Romania, Syria,
Switzerland, Slovenia, Slovak Republic, the United States and Vietnam.  The possibility of suchagreements with a number of other countries was under active consideration. Those agreementssought  to strengthen economic links, but did not contain any provisions for preferential trade.
- Other non-trade bilateral agreements
204. The representative of Armenia noted that Armenia had also signed a series of other
agreements on investment and on customs relations .  The reciprocal investment promotion and
protection agreements sought to encourage investme nt between the parties, primarily by guaranteeing
national and more favourable treatment, non-expropriation (expropriation, an extremely rare measure,
could be executed only due to public needs, upon providing preliminary adequate and effective
compensation for the expropriated investments), and unrestricted transfers of investment funds andreturns from the investments, implementation of international arbitration practices in the case ofdisputes between parties, as well providing guarantees against legislative changes.
205. He further noted that investment agreements had been signed with 26 governments:
Argentina, Austria, Belarus, Belgium-Luxembourg,  Bulgaria, Canada, China, Cyprus Egypt, France,
Georgia, Germany, Greece, Iran, Israel, Switzerland, Italy, Kyrgyz Republic, Lebanon, Romania,Russian Federation, Chinese Taipei, Turkmenistan, Ukraine, the United Kingdom, the United States
and Vietnam.  Agreements on customs relations were intended to ensure cooperation and smoothWT/ACC/SPEC/ARM/1/Rev.7
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working relations between the customs services of the signatories.  Such agreements had also been
signed with Georgia, Iran, Tadjikistan, Turkmenistan and Ukraine.
206. In response to further requests for clarification of the compatibility of Armenia's free trade
agreements with the CIS States with Article XX IV of the GATT 1994, the representative of Armenia
stated that within the framework of the 1994 Free-Trade Agreement among the countries of the
Commonwealth of Independent States (CIS), Ar menia’s plurilateral and bilateral free-trade
agreements eliminated duties and other restrictive regulations on substantially all trade between theparties.  Armenia considered that these arrangements were consistent with Article XXIV of GATT1994.  He noted that at present Armenia did  not conduct trade with all  CIS countries, but in respectof those countries with which Armenia did trade, Armenia imposed no taxes nor barriers on itsimports and exports of goods.  These agreements did not cover trade in services.
207. The representative of Armenia confirmed that Armenia would observe the provisions of the
WTO Agreement including Article XXIV of the GATT 1994 and Article V of the GATS in its trade
agreements, and that it would ensure that the provisions of these WTO Agreement for notification,
consultation, and other requirements concerning preferential trading systems, free trade areas, andcustoms unions of which Armenia was a member were met from the date of accession. He confirmedthat Armenia would, upon accession, submit notifications and copies of its free-trade area andcustoms union agreements to the Committee on Regional Trade Agreements (CRTA).  He furtherconfirmed that any legislation or regulations required to be altered under its trade agreements wouldremain consistent with the provisions of the WT O and would, in any case, be notified to the CRTA
during its examination.  The Working Party took note of these commitments.
- Plurilateral trade agreements
208. The representative of Armenia informed the Working Party that the Government of Armenia
would join the Agreement on Trade in Civil Aircra ft reflecting corresponding tariff commitments in
its Schedule of Concessions on Trade in Goods. The Working Party took note of these commitments.
- Transparency - Publication of Information
209. Some members of the Working Party requested that the Government of Armenia confirm that
from the date of accession, all laws, regulations, rulings, decrees or other measures related to trade ingoods or services would be published in its official publication for public review at least two weeksprior to implementation, unless a longer period was specified under the relevant WTO Agreement.WT/ACC/SPEC/ARM/1/Rev.7
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210. The representative of Armenia confirmed that, from the date of accession, all laws,
regulations, rulings, decrees or other measures related to trade in goods or services would bepublished in its official publication for public review at least two weeks prior to implementation,unless a longer period was specified under the releva nt WTO Agreement,  and that no law, rule, etc.,
related to trade in goods and services would become effective prior to such publication.  He further
stated that Armenia would fully implement Article X of the GATT 1994, and Article III of the GATSand the other transparency requirements of WTO Agreements requiring notification and publication.The Working Party took note of these commitments.
Notifications
211. The representative of Armenia said that by  Decree No. 321 of the Government of the
Republic of Armenia of 17 June 2000 the "WTO Noti fication Agency in the Republic of Armenia"
had been established and was now operational.  The internet address was www.wtonc.am, and contact
information for the Agency was as follows:  email:  wtonc@wtonc.am, fax no. (374 1) 543 983,
tel. no. (374 1) 543 981 and 543 982.
212. The representative of Armenia said that at the latest upon entry into force of the Protocol of
Accession, Armenia would submit all initial notifications required by an Agreement constituting partof the WTO Agreement.  Any regulations subsequently enacted by Armenia which gave effect to lawsenacted to implement any Agreement constituting part of the WTO Agreement would also conform tothe requirements of that Agreement. The Working Party took note of these commitments.
Conclusions
213. The Working Party took note of the explanations and statements of Armenia concerning its
foreign trade regime, as reflected in this repo rt. The Working Party took note of the commitments
given by Armenia in relation to certain specific matters, which are reproduced in paragraphs [23, 29,
34, 36, 37, 47, 53, 54, 61, 62, 71, 82, 83, 93, 98, 100, 102, 108, 111, 115, 130, 131, 138, 139, 143,145, 148, 151, 154, [155], 157, [158], 162, 192, 207, 208, 210, 212] of this Report.  The WorkingParty took note that these commitments had been incorporated in paragraph 2 of the Protocol ofAccession of Armenia to the WTO.
214. Having carried out the examination of the foreign trade regime of Armenia and in the light of
the explanations, commitments and concessions made by the representatives of Armenia, the WorkingParty reached the conclusion that, Armenia should be invited to accede to the Agreement Establishingthe WTO pursuant to the provisions of Article XII.  For this purpose the Working Party has preparedWT/ACC/SPEC/ARM/1/Rev.7
Page 81
the draft Decision and Protocol of Accession reprodu ced in the Appendix to this report,  and takes
note of Armenia's Schedule of Specific Commitments on Services (document ... ) and its Schedules ofConcessions and Commitments on Agriculture and Goods (document ... )  that are attached to theProtocol of Accession.  It is proposed that thes e texts be approved by the General Council when it
adopts the Report.  When the Decision is adopte d, the Protocol of Accession would be open for
acceptance by Armenia, which would become a Member thirty days after it accepts the said Protocol.The Working Party agreed, therefore, that it had completed its work concerning the negotiations forthe accession of Armenia to the Agreement Establishing the WTO.
[to be completed]
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ANNEX I
The List of Products Subject to Mandatory Conformity Assessment approved by the Decree
No. 239 of the Government of Ar menia of 12 May, with Amendm ents Approved by Decree No. 110
of 17 February 2001, Decree No. 297 of 12 April 2001 and Decree No. 825 of 6 September 2001.
Description CN code
Meat of bovine animals, frozen. 0202
Meat of swine, frozen 020321-020329
Edible offal of bovine animals and swine, frozen 020621 000, 020622, 020641
Meat and edible offal of poultry, frozen 020712, 020714, 020725, 020727,
020733, 020736
Pig fat 020900 110
Meat and edible meat offal, salted, in brine, dried or smoked 0210
Fish, fish meat, frozen, dried, salted, smoked 0303, 030420, 0305
Milk and milk products 0401, 0402, 040310, 040510, 040590, 0406
Birds' eggs 040700
Natural honey 040900 000
Peas, chickpeas, lentils 0713-071340
Bananas, dates, pineapples, dried grapes, melons, dried fruit 080300, 080410 000, 080430 000,
0805, 080620, 0807, 0813
Coffee, tea 0901, 0902
Rice 1006
Cereal flours 110100, 1103
Soya-bean, olive, sunflower-seed, maize oil 150710 900, 150990 000,
151219 910, 151529 900
Animals and Vegetable fats and oils, margarine 1516, 1517
Preparations of meat, fish or crustaceans, molluscs and otheraquatic invertebrates1601-1605
Sugar, sugar confectionery 1701, 170290, 1703, 1704
Cocoa, preparations containing cocoa 180500 000, 1806
Infant food 190 110 000
Preparations of cereals, flour, starch and milk, pastry cooks'
products1902-1905 (ex. 190590 300)
Preparations of vegetables, fruit, nuts or other parts of plants 2001-2009
Miscellaneous edible preparatio ns, yeast, ice-cream, cheese
fondues2101-2105, 210690 100
Beverages, spirits and vinegar 2201-2209
Tobacco and manufactured tobacco substitutes 2401-2403
Table salt 250 100 910
Natural sands of all kinds, whether or not coloured 2505
Road-metal used for concrete 251 710 100
Portland cement, not coloured and pozzolanic 252321 000, 252390 300
Oil products 2707, 2710, 2711
Fertilizers 3102-3105
Paints 3208, 3209
Perfumes, beauty or make-up preparations and preparations for
use on the hair, preparations for oral hygiene, shaving, de odorants
and antiperspirants3303-3306, 330710 000, 330720 000
Soap, washing and cleaning preparations 3401, 3402 20, 3402 90
Modelling pastes, preparations for use in dentistry 340 700 000
Photographic plates for medical X-ray use 370 110 100
Hydraulic brake, anti-freezing fluids and their components 381900 000, 382000 000WT/ACC/SPEC/ARM/1/Rev.7
Page 83
Description CN code
Articles of plastics for the conveyance, packing, tableware and
kitchenware392310-392330, 392410 000
Pneumatic tires of a kind used on motor cars, lorries and buses 401110 000, 401120
Retreated or used pneumatic tires 4012
Contraceptives, teats for babies 401410 000, 401490 100
Surgical gloves 401 511 000
Household and sanitary articles of paper, cellulose wadding or
webs of cellulose fibres, cotton481810, 481820, 481840, 560110
Men's, women's and children's pyjamas, underpants, knitted or
crocheted6107-6109, 6207, 6208
Babies' garments, knitted or crocheted 6111, 6209
Brassieres, girdles, corsets and similar articles 6212
Bars, hot-rolled, in irregularly wound coils, of iron or non-alloy
steel, of circular cross-section measuring less than 14 mm in
diameter, for reinforced concrete721 391 100
Bars and rods, hot-rolled, for reinforced concrete 721 499 100
 Electrodes and cored wire of base metal, for electric arc-welding 831110 900, 831120 000
Electro-mechanical domestic appliances 8509 ( ex. 850990)
Electro-shavers, hair clippers 851010 000, 851020 000
Domestic electric heating apparatus, water heaters, immersion
heaters8516 (ex. 851680, 851690)
Line telephone sets with cordless handsets 8517 11 000
-Telephonic or telegraphic switching
apparatus8517 30 000
Other apparatus, for carrier-current line systems or for digital line
systems8517 50
Parts 0f apparatus for carrier-current line systems of subheading
8517 50 100851790
Transmitting or receiving apparatus for radiotelephone,
radiotelegraph communication, radio and television8525 10 900; 8525 20 910; 8525 20 990
Aerials and aerial reflectors of all kinds; parts suitable for use
therewith8529 10 (8529 10 100; 8529 10 400;
8529 10 500)
Electric signalling apparatus for burglar or fire alarms 853 110 300
Electric apparatus for switching, protecting electric circuits, for
making connections to or in electric circuits853620 100, 853641, 853650,
(ex. 8536 50 900)  853661, 853669, 853690
Electric lamps 853922, 853931
Electric cables and wires 8544 20 000, 8544 41 100, 8544 49 200,
854 459 800, 8544 70 000
Syringes of plastics, with or without needles 901 831 100
Revolvers and pistols, other than those of heading No. 93.03 or93.049302 00
Plain-barrel single-barrelled sporting and hunting guns From 9303 20 800
Plain-barrel double-barrelled sporting and hunting guns From 9303 20 800
Combined guns From 9303 20 800
Rifled sporting and hunting gun From 93 03 30 000
Gas pistols and revolvers using cartridges charged with tear or
stimulant substancesFrom 9303 90 000
Signal flares and other devises for
 lunching of signal flaresFrom 9303 90 000
Aerosol devises (gas cylinders), sprayers charged with tear or
stimulant substancesFrom 9304 00 000
Pneumatic and gas arms, as well as spring arms From 9304 00 000
Cartridges for riveting or similar tools or for captive-bolt humane
killers and parts thereofFrom 9306 10 000WT/ACC/SPEC/ARM/1/Rev.7
Page 84
Description CN code
Cartridges From 9306 21 000
Shot cartridge cases From 9306 29 400
Bullets for pneumatic arms From 9306 29 700
Wads for cartridges for hunting and sporting arms From 9306 29 700
Little bullets, shot and grape-shot From 9306 29 700
From 9306 30 100
From 9306 30 980
Bullets for cartridges for rifled and plain- barrel arms From 9306 29 700
From 9306 30 100From 9306 30 300From 9306 30 980
Cartridges for gas pistols and revolvers From 9306 30 910
From 9306 30 930
Cartridges and rockets for signal arms From 9306 30 910
From 9306 30 930
Swords, cutlasses, bayonets, lances and similar arms and partsthereof and scabbards and sheaths therefore9307 00 000
metal prefabricated building structures
(reinforced preparations, bush parts welded on, their connections
for ferro-concrete structures)940 600 390
prefabricated building ferro-concrete structures
(logs for coverings and anvils, posts, slide-valves, farms)94 06 00 900
Toys 9502, 9503 (ex. 950291 000, 950299 000)
Gas fuelled 961 310 000
_______________WT/ACC/SPEC/ARM/1/Rev.7
Page 85
APPENDIX
[ DRAFT DECISION
ACCESSION OF ARMENIA
Decision of […]
The General Council
Having regard to  paragraph 2 of Article XII and paragraph 1 of Article IX of the Marrakesh
Agreement Establishing the World Trade Organization (the "WTO Agreement"), and the Decision-Making Procedures under Articles IX and XII of the WTO Agreement agreed by the General Council
(WT/L/93);
Conducting  the functions of the Ministerial Conference in the interval between meetings
pursuant to paragraph 2 of Article IV of the WTO Agreement;
Noting  the results of the negotiations directed toward the establishment of the terms of
accession of Armenia to the WTO Agreement and having prepared a Protocol on the Accession of
Armenia;
Decides  as follows:
1. Armenia may accede to the WTO Agreement on the terms and conditions set out in the
Protocol annexed to this Decision.
_______________WT/ACC/SPEC/ARM/1/Rev.7
Page 86
DRAFT PROTOCOL
ON THE ACCESSION OF ARMENIA
Preamble
The World Trade Organization (hereinafter referred to as the "WTO "), pursuant to the approval
of the General Council of the WTO accorded under Article XII of the Marrakesh Agreement
Establishing the World Trade Organization (hereinafter referred to as the "WTO Agreement "), and
Armenia,
Taking note of the Report of the Working Pa rty on the Accession of Armenia to the WTO
Agreement reproduced in document WT/ACC/ARM…, dated […] (hereinafter referred to as the
"Working Party Report"),
Having regard to the results of the nego tiations on the accession of Armenia to the WTO
Agreement,
Agree as follows:
PART I -  GENERAL
1. Upon entry into force of this Protocol pursuant to paragraph 8, Armenia accedes to the WTO
Agreement pursuant to Article XII of that Agre ement and thereby becomes a Member of the WTO.
2. The WTO Agreement to which Armenia accedes shall be the WTO Agreement, including the
Explanatory Notes to that Agreement, as rectifie d, amended or otherwise modified by such legal
instruments as may have entered into force before th e date of entry into force of this Protocol.  This
Protocol, which shall include the commitments refe rred to in paragraph […] of the Working Party
Report, shall be an integral part of the WTO Agreement.
3. Except as otherwise provided for in paragr aph […] of the Working Party Report, those
obligations in the Multilateral Trade Agreements  annexed to the WTO Agreement that are to be
implemented over a period of time starting with the entry into force of that Agreement shall be
implemented by Armenia as if it had accepted that Agreement on the date of its entry into force.
4. Armenia may maintain a measure inconsistent with paragraph 1 of Article II of the GATS
provided that such a measure was recorded in the li st of Article II Exemptions  annexed to this Protocol
and meets the conditions of the Annex to the GATS on Article II Exemptions.
PART II - SCHEDULES
5. The Schedules reproduced in Annex I to th is Protocol shall become the Schedule of
Concessions and Commitments annexed to th e General Agreement on Tariffs and Trade 1994
(hereinafter referred to as the "GATT 1994") and the Schedule of Specific Commitments annexed to the
General Agreement on Trade in Services (hereinafter referred to as "GATS") relating to Armenia.  The
staging of the concessions and commitments listed in the Schedules shall be implemented as specified in
the relevant parts of the respective Schedules.
6. For the purpose of the reference in paragraph 6(a) of Article II of the GATT 1994 to the date of
that Agreement, the applicable date in respect of the Schedules of Concessions and Commitments
annexed to this Protocol shall be the date of entry into force of this Protocol.WT/ACC/SPEC/ARM/1/Rev.7
Page 87
PART III - FINAL PROVISIONS
7. This Protocol shall be open for acceptance, by signature or otherwise, by Armenia until […].8. This Protocol shall enter into force on the thirtieth day following the day upon which it shall
have been accepted by Armenia.
9. This Protocol shall be deposited with the Dire ctor-General of the WTO.  The Director-General
of the WTO shall promptly furnish a certified copy of this Protocol and a notification of acceptance by
Armenia thereto pursuant to paragraph 9 to  each Member of the WTO and to Armenia.
This Protocol shall be registered in accordance with the provisions of Article 102 of the Charter
of the United Nations.
Done at […] this […] day of […] in a single c opy in the English, French and Spanish languages,
each text being authentic, except that a Schedule annexed hereto may specify that it is authentic
in only one of these languages.
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Page 88
ANNEX I
SCHEDULE […] – ARMENIA
Authentic only in the … language.
(Circulated in document WT/ACC/ARM/…/Add.1)
_______________
SCHEDULE OF SPECIFIC COMMITMENTS ON SERVICES
LIST OF ARTICLE II EXEMPTIONS
Authentic only in the … language.
(Circulated in document WT/ACC/ARM/…/Add.2) ]
__________