RESTRICTED
WORLD TRADE WT/ACC/HRV/27
22January 1997
ORGANIZATION(97-0226)
Original: English
ACCESSION OFCROATIA
Additional Questions andReplies
totheMemorandum ontheForeign Trade Régime
(L/7466)
ThefollowingadditionalquestionsandrepliestotheMemorandumontheForeignTradeRégime
havebeenreceived from thePermanent Mission oftheRepublic ofCroatia.
_______________
Table ofContents
Reference Question Page
II.1(b) Main Directions ofOngoing Economic Policies 1-3 3
III.2(a) Evolution ofCustoms Tariff Regulation 4 4
III.2(b) Customs Tariff Nomenclature, Types ofDuties, General
Description oftheCustoms Tariff Structure 5-7 4
III.2(d) Taxation Régime 8 5
III.2(h) Rules ofOrigin 9 5
IV.5 System ofForeign Investments intheRepublic ofCroatia 10 5
IV.6 Government Procurement 11-12 5
IV.7 State Trading 13 6
IV.9 Subsidy Policy 14 6
Re: Document WT/ACC/HRV/11
III.I(d) Long-term production co-operation 15 6
III.2(d) Taxation Régime 16-20 7
III.2(f).1 Quotas 21-23 8
III.4 Incentives forExports ofGoods andServices 24-25 8
III.4(a) Protective Measures 26-28 9
i.Safeguard measures 26 9
ii.Anti-dumping 27 9
iii.Countervailing measures 28 10
IV.2 Trade inAgricultural Products 29-36 10
IV.6 Government Procurement 37-46 13
IV.7 State-trading Enterprises 47 14
IV.9 Subsidy Policy 48 14
VI Trade inServices 49-50 15
Banking andother financial services 49 15
Telecommunications services 50 15WT/ACC/HRV/27
Page2
Reference Question Page
Re: Document WT/ACC/HRV/13 (TBT) 51-56 16
Re: Document WT/ACC/HRV/15 (Intellectual Property Régime) 57-79 17-21
i.General 57-58 17
ii.Copyright andrelated rights 59-65 18
iii.Geographical indications 66-67 19
iv.Industrial designs 68 20
v.Patents 69-71 20
vi.Protection ofundisclosed information 72 21
vii.Enforcement 73-77 21
Re: Document WT/ACC/HRV/19 (Customs Valuation) 78 22
Re: Document WT/ACC/HRV/20 (Internal Taxation Régime) 79 23
Re: Document WT/ACC/HRV/23 (Export Quotas for1996) 80 23
Re: Document WT/ACC/HRV/24 (Rules ofOrigin) 81 24
Re: Document WT/ACC/HRV/25 (Import Licensing) 82 24
Re: Document WT/ACC/SPEC/HRV/1 (Domestic Support and
Export Subsidies intheAgricultural Sector) 83 25
Annex Turnover Tax 26WT/ACC/HRV/27
Page3
Section II.1(b) -Main Directions ofOngoing Economic Policies
Question 1.
Please provide alistofallthepublic enterprises which areseparately covered in
theprivatization program.
Answer:
Thefollowing public companies areforeseen toenter theprivatization program:
Croatian Railways Croatian Electricity Company
Croatian Forests Croatian PostandTelecommunications
Official Gazette Coastal Shipping Company
INAPetroleum Plovput (lighthouse company)
Croatian Radio andTelevision Broadcasting
Question 2.
Please provide adetailed explanation forthedivision ofresponsibility within central
Government withrespect tothedecision making process ontrade related issues. Forexample,
what isthehierarchy oflaws? Who isresponsible fortaking decisions relating tochanges inthe
Customs Tariff orExcise Duties orintroducing oramending legislation?
Answer:
EachMinistryisresponsibleforintroducingoramendinglegislationwithinitscompetence.
Forinstance, theMinistry ofFinance isresponsible fortariffs, taxes, budget, financial activities, foreign
exchange regime, etc.Once theappropriate Ministry prepares adraft laworanamendment, that
document ispresented totheGovernment oftheRepublic ofCroatia. Ifthedocument passes the
Government thenitisforwarded totheParliament (ifthedocument doesnotpasstheGovernment,
itisreturned totheappropriate Ministry, corrected andforwarded totheGovernment again). The
document mayreceive Parliamentary approval atthefirstsession orbereturned forcorrections.
Question 3.
Please clarify thestatement thatcentral andlocal government share responsibility
for"granting concession rights". What ismeant bythephrase "granting concession rights"?
Answer:
Sharing responsibility means thedivision ofauthorities andrights among central andlocal
governments asfollows: theGovernment oftheRepublic ofCroatia forwards aproposal concerning
thegranting ofconcession rights totheHouse ofRepresentatives oftheCroatian Parliament, whothen
decides ontheconcession. Prior toforwarding theproposal totheParliament, theGovernment of
theRepublic ofCroatia hastoobtain anopinion fromthelocalexecutive authority (town, county etc.),
onwhose areatheconcession willbeexploited, concerning theconcession.
TheParliament andtheGovernment arenotbound bytheopinion oflocalauthorities.
Inthataswellasintheprevious procedural case, theHouse ofRepresentatives hasto
establish thecompliance withpublic interest (interest oftheRepublic ofCroatia) asoneoftheconditions
toacquire theconcession right.
Granting aconcession rightmeans deciding upon aconcession inaparticular case.WT/ACC/HRV/27
Page4
III.2(a) -Evolution ofCustoms Tariff Regulation
Question 4.
With respect totheresponse toQuestion 16indocument WT/ACC/HRV/3, please
provide detailed information regarding theconditions which justify protection oftheindustries
listed intheresponse. Areforms ofprotection other thantariff levels used?
Answer:
Theconditions which mayjustify theprotection ofCroatian industries andtheforms of
protection arecontained inArticles 38-43 oftheLawonTrade.
III.2(b) -Customs Tariff Nomenclature, Types ofDuties, General Description oftheCustoms Tariff
Structure
Question 5.
Croatia refers toa"special customs clearance procedure" forgoods arriving from
countries where reciprocity doesnotexist. Please explain indetail what thisprocedure involves
thatisdifferent from thenormal procedure.
Answer:
ThenewLawonCustoms Tariff of1July1996abolished thespecial customs clearance
procedure provision.
Question 6.
Please clarify what ismeant bythelastparagraph inthissection, which refers to
theimposition ofaunified customs rateof8%togoods which "areclassified under more than
twotariff numbers". Doesthatmean thatthe8%ratewillapply if(i)there aretwotariff numbers
onthecustoms declaration form, or(ii)goods canbeclassified under either oftwoheadings.
Answer:
Theunified customs rateof8%isapplied onlyincases where private persons entering
intoCroatia bring different goods together valued lessthan500US$andwhere thesegoods areclassified
under more thantwotariff numbers. Itisameasure tofacilitate theentry oftravellers intoCroatia.
Question 7.
Please confirm thatCroatia isprepared toundertake tocompletely eliminate the
possibility ofapplying seasonal duties.
Answer:
Withtheintroduction ofCroatia 'snewcustoms tariffon1July1996, Croatia abolished
allcustoms feesandduties other thanthecustoms duties contained initscustoms tariff. Foranumber
ofagricultural products, theratesindicated arecompound rates, consisting ofanadvalorem andspecific
dutyrate. AsisthecaseintheCommon External Tariff (CET) oftheEuropean Union, weintend
toestablish periods andmaximum levels ofthespecific dutyelement ofthecompound duties forfresh
fruits andvegetables inourcustoms tariff. Wedonotplantointroduce anyother seasonal duties or
charges.WT/ACC/HRV/27
Page5
III.2(d) -Taxation Régime
Question 8.
Wehavenoted thatthesalestaxwillbereplaced byaVAT asfrom 1January 1997
andwould welcome concise information about theapplication ofthisnewtax. Please confirm
thatfullnational treatment willapply.
Answer:
According totheLaw onValue Added Tax, theVAT wastobeapplied from
1January 1997. However, on6December 1996, anamendment totheLawonValue Added Tax
waspassed, which stipulates thattheLawwillbeimplemented on1January 1998. TheLawonValue
Added Taxprovides fullnational treatment.
III.2(h) -Rules ofOrigin
Question 9.
Please confirm thatthecompany headquarters location requirement will,orhasbeen,
removed from thelistofrequirements indetermining theorigin ofaproduct. Please alsoconfirm
thatCroatia willcomply withtheprovisions oftheWTO relating torules oforigin atthelatest
from thedateofaccession.
Answer:
TheCroatian regulation relating totheCompany headquarters location requirement is
valid onlyinthecontext ofpreferential dutytreatment, buthasnotbeenapplied since 1993.
Newlegislation onrulesoforigin willbedeveloped in1997 andwillfullycomply with
therelevant WTO provisions.
IV.5 -System ofForeign Investments intheRepublic ofCroatia
Question 10.
Further totheresponse provided toQuestion 121inWT/ACC/HRV/3, please clarify
what ismeant by"areas under MoD supervision" andprovide details ofthespecial procedure
involved when seeking toinvest inthese areas.
Answer:
Theareas arenotintheLawspecified since theyinclude thewhole oftheactivities that
theMinistry ofDefence isresponsible. Special procedure areaccordingly notprescribed bylawbut
areestablished asinternal totheMinistry ofDefence operational standards.
IV.6 -Government Procurement
Question 11.
Weexpect Croatia tojointheGovernment Procurement Agreement asanintegral
partofitsaccession package. What areCroatia 'sintentions inthisrespect?
Answer:
TheCroatianGovernmenthasnotyetdecidedwhethertojointheGovernmentProcurement
Agreement.WT/ACC/HRV/27
Page6
Question 12.
IsCroatia prepared toreconsider Article 3.7oftheDecree onPublic Procurement,
which allows forthepossibility toshow "national preference"?
Answer:
Answer tobeprovided later.
IV.7 -State Trading
Question 13.
Please provide theWorking Party withacomplete listofALL enterprises, whether
ornotState-owned, which have been granted special orexclusive rights.
Answer:
Alistofallenterprises which havespecial orexclusive rights iscontained inthereply
toQuestion 156indocument WT/ACC/HRV/11.
IV.9 -Subsidy Policy
Question 14.
FurthertotheresponseprovidedtoQuestion57indocumentWT/ACC/HRV/3,please
provide much more detailed information about the"subsidies" and"guarantees" mentioned in
thisresponse, andanyother subsidies which maybegranted bytheCroatian authorities.
Answer:
Adetailed description ofCroatia 'ssubsidy program iscontained indocument
WT/ACC/HRV/12.
RE: DOCUMENT WT/ACC/HRV/11
Section III.1(d) -Long-term production co-operation
Question 15.
Theresponse toQuestion 17states that, asaresult ofthenewTrade Law,
"Transactions concluded onthebasis oftheagreement onlong-term production co-operation have
been putonthesame level asother foreign trade export andimport operations. Contracting
partiesarefreetodeterminethetermsoftransactionsinvolvinglong-termproductionco-operation".
What doesthismean inpractice?
Answer:
Companieswhichareengagedintransactionsinvolvinglong-termproductionco-operation
arefreetodosoifitisintheirownbusiness interest, without being obliged toregister suchoperations
withtheMinistry ofEconomy, asrequired byprevious legislation.WT/ACC/HRV/27
Page7
Section III.2(d) -Taxation Régime
Acertain contradiction hasbeendetected intheanswers related tothedifferent taxes
thatareorwillbeapplied.
Question 16.
Could Croatia provide adetailed listwithallproducts subject totaxes (provisional
tax,excise tax,special tax,turnover tax),withaclear indication foreachtaxofthetaxlevelfor
eachproduct andwhether thetax(es) is(are)applied inthesame manner todomestic andimported
goods?
Answer:
Adetailed listofallexcise taxes wereprovided indocument WT/ACC/HRV/11 under
Question 50onpage20.Croatia doesnothaveanprovisional taxorspecial tax.Theturnover tax
isapplied equally tobothdomestic andimported products. Forfurther details oftheturnover taxplease
refertotheattached Annex (page 26).
Question 17.
Ifanyoftheabove mentioned taxes hasnowbeen abolished, please indicate this.
Answer:
Seepreceding question.
Question 18.
What isthetimetable forabolition ofthose taxes which willbeabolished buthave
notalready been so?
Answer:
There isnointention toabolish theexcise tax. Asmentioned before indocument
WT/ACC/HRV/11, theexcise taxwillbeadapted totherules andprinciples oftheWTO prior to
Croatia 'saccession (i.e.provision ofnational treatment). Theturnover taxwillbereplaced bythe
VAT on1January 1998.
Question 19.
What isthetimetable forharmonising thedifferent excise taxrates, asindicated
intheresponses toQuestions 48and50?
Answer:
Seepreceding question.
Question 20.
Regarding theresponse toQuestion 49,doesCroatia really intend toabolish theexcise
tax,oristhisaprinting error.
Answer:
Thiswasaprinting error. Theexcise taxwillcontinue tobeapplied inthefuture, however
onanational treatment basis (asstated above).WT/ACC/HRV/27
Page8
Section III.2(f) -Quotas
Intheresponse toQuestion 59there isanindication thatasmall number ofimport
quotas mayremain inplace afterthebeginning of1997. Intheresponse toQuestion 60itisstated
that"there isnotasingle product forwhich animport quota isimposed".
Question 21.
Please explain thereason fortheapparent contradiction referred toabove.
Answer:
Wecanconfirm thatthegovernment oftheRepublic ofCroatia hasadopted aDecree
on12July1996, bywhich alltheimport quotas havebeenabolished, asoftheabove mentioned date.
Question 22.
Please listthose products forwhich suchquotas willremain.
Answer:
Seepreceding question.
Question 23.
What isthereason formaintaining quotas onthese products, given Croatia 'sintention
totariffy allsuchmeasures (e.g.intheresponse toQuestion 62)?
Answer:
Seepreceding question.
Section III.4-Incentives forExports ofGoods andServices
Question 24.
Could Croatia please confirm that thedevelopment programs mentioned in
WT/ACC/HRV/11, answer toQuestion 80,page 32,donotinclude export subsidies.
Answer:
Thedevelopment programs mentioned indocument WT/ACC/HRV/11, (answer to
Question 20)donotinclude export subsidies.
Question 25.
Ifnot,canitplease statewhether itplans toabolish suchincentives upon itsaccession
totheWTO?
Answer:
Seepreceding question.
III.4(a) -Protective Measures (answer toQuestion 84,page33)
Wehaveexamined Croatia 'sLawonTrade inforce asof17February 1996, which
submitted totheWTO Secretariat inMarch 1996. Thefollowing questions areraised bythetext
oftheLaw.WT/ACC/HRV/27
Page9
i.Safeguard Measures
Question 26.
Article 38,lastsentence oftheLawonTrade indicates thata"special regulation
ontheinvestigation procedure andimposition ofmeasures from thisArticle "will beissued by
Croatia 'sGovernment. Could Croatia please provide acopy ofthisregulation when itstextis
finalized?
Answer:
Croatia willprovide acopyofthespecial regulation ontheinvestigations procedure and
imposition ofsafeguard measures assoonasithasbeenprepared andadopted bytheGovernment.
ii.Anti-dumping
Question 27.
(a) Article 48oftheLawonTrade setsoutthesubstantive criteria forassessing dumping.
Paragraph 2provides that"aproduct istobeconsidered asbeing introduced intothecommerce
oftheRepublic ofCroatia atalessthanitsnormal value (dumping), iftheprice oftheproduct
islessthanthecomparable price, intheordinary course oftrade, forthelikeproduct when destined
forconsumption intheexporting country plusareasonable amount foradministrative, selling and
other costsandforprofits". Provided thattheEnglish translation fullycorresponds totheoriginal
textoftheLawonTrade, thiswording appears tomixthenormal value calculation method based
onactual prices inthecountry oforigin/exportation withtheconstructed normal value method.
Could Croatia please state itsview about thecompatibility ofthisdefinition with
theWTO Anti-dumping Agreement, particularly withArticle 2(1)and"(2)thereof?
Furthermore, could Croatia state itsviews onthecompatibility ofArticle 48(3)'s
alternative normal value criteria withArticle 2(2)oftheWTO Anti-dumping Agreement?
(b) Article 49(5) oftheLawonTrade indicates that"special detailed regulations onthe
manner andother conditions forapplying theanti-dumping procedure andtheadditional duty"
willbeissued byCroatia 'sGovernment.
Could Croatia please provide acopy ofthisregulation when itstextisfinalized?
Answer:
Regarding thedefinition ofthesubstantive criteria forassessing dumping andthe
compatibility ofArticle 48oftheLawonTrade withArticle 2oftheAgreement ontheImplementation
orArticle VIoftheGeneral Agreement onTariffs andTrade 1994, werecognize thatamistake has
beenmade. Wewilltherefore change Article 48andmake itcompatible withtheprovisions ofthe
WTO Anti-dumping Agreement. Likewise, wewillchange Article 49oftheLawtobring itinto
conformity withthe"standing requirement" ofArticles 4and5oftheAgreement.
Wewishtopoint outthattheanti-dumping legislation stipulated inArticles 48and49
oftheLawonTrade cannot beimplemented without aspecial regulation onthemanner andother
conditions forapplying theanti-dumping procedure andtheadditional (anti-dumping) duty. This
regulation willbeincompliance withtheWTO Anti-dumping Agreement.
WewillprovidetheWTOSecretariatwithacopyoftheabovementionedspecialregulation
assoonasithasbeenprepared andadopted bytheGovernment.WT/ACC/HRV/27
Page10
iii.Countervailing Measures
Question 28.
Article 50oftheLawonTrade doesnotprovide foraninjury requirement forthe
imposition ofcountervailing measures, nordoesitseem toprovide fordifferential treatment of
theso-called "non-actionable subsidies" within themeaning ofArticle 8oftheSubsidies and
Countervailing Measures Agreement.
Does Croatia plantobring itslegislation intoconformity withtherequirements of
theWTO Agreement onSubsidies andCountervailing Measures?
Could Croatia please provide acopy ofthisregulation when itstextisfinalized.
Answer:
Inthecourse ofchanging theLawonTrade (seeabove), wewillinsert theinjury criterion
intoArticle 50oftheLaw, aswellasaprovision relating tothetreatment ofnon-actionable subsidies.
Withregard totheapplication ofcountervailing measures, Article 50oftheLawonTrade
stipulates thattheGovernment oftheRepublic ofCroatia willadopt aspecial Regulation onthe
procedures fortheapplication ofcountervailing measures. Thisregulation willbemade incompliance
withtherelevant WTO Agreement onSubsidies andCountervailing Measures andwillbecommunicated
totheWTO Secretariat assoonasadopted bytheGovernment ofCroatia.
IV.2 -Trade inAgricultural Products
Question 29.
When willCroatia beinaposition toprovide afullcustoms tariff foragricultural
products withallthedetails oftheexact dutyrates (advalorem andspecific), including seasonal
requirements (answer toQuestion 34)?
Answer:
AcopyofthenewCroatian Customs Tariff inprinted formaswellasondiskette, both
intheCroatian language, hasbeenavailable intheWTO Secretariat forsome timenow(document
WT/ACC/HRV/16). AnEnglish version oftheCustoms Tariff wasdelivered totheWTO Secretariat
recently (document WT/ACC/HRV/16/Rev.1).
Re:Answers toQuestions 59,60,62and63
Question 30.
Could Croatia provide alistofagricultural products forwhich import quotas will
stillbeinplace asfrom 1January 1997, withaclear indication ofthesizeofthequotas andthe
in-andtheout-of-quota rates?
Answer:
Weconfirm thattheGovernment oftheRepublic ofCroatia hasadopted aDecree on
12July1996, bywhich allimport quotas havebeenabolished, asoftheabove mentioned date.
Question 31.
DoesCroatia intend toeliminate these quotas inthefuture? Ifso,whatistheintended
timetable forabolition?WT/ACC/HRV/27
Page11
Answer:
Seepreceding question.
Re:Answers toQuestions 119.4, 121,130and154
Wehave taken good noteofwhat Croatia hassaidabout TheState Directorate for
Commodity Reserves ,andespecially the"intention tonarrow itsactivities".
Question 32.
Would itbepossible forCroatia toexplain inmore details howthesystem works
inpractice?
Answer:
Theoperation oftheStateDirectorate forCommodity Reserves isregulated bytheLaw
onState Commodity Reserves (Official Gazette 92/1994). Reorganization oftheDirectorate in
co-operation withtheWorld Bank iscurrently taking place. Forthetimebeing theDirectorate is
operating under thestated lawaccording towhich commodity reserves areusedfor(i)securing the
necessary quantities tosatisfy theneeds incaseofwarorimminent warorgreat natural disasters and
(ii)intervention onthemarket inorder tosecure itsstability inthecaseofgreatdistortions ortoprevent
suchdistortions.
Commodity reserves consist ofagricultural andfoodproducts, production inputs, some
industrial products, petrol anditsderivatives, medicine andhospital material. Measures ofintervention
onthemarket bytheState Directorate aretaken oninstruction from theGovernment ofCroatia in
thecasewhen market distortions could notberesolved byusual measures. Theoperation ofreserves
iswithin theresponsibility oftheStateDirectorate, which isanon-profit governmental organization.
ThecontextinwhichtheStateDirectorateconductsinterventionsontheagriculturalmarket
isasfollows. Thesystem ofprotective prices which isapplied intheRepublic ofCroatia forsix
agricultural products istechnically carried outthrough activities oftheStateDirectorate forcommodity
reserves, i.e.activities which secure protective prices forproducers ofthose products thattheCroatian
Government considers strategically important andwhich arethesubject ofpublic stockholding.
Theintention to"narrow theactivities oftheDirectorate" refers toalower levelofreserves
forcertain agricultural products inpermanent reserves. Thevolume ofmarket intervention reserves
willgreatly decrease; thiswillbeachieved by(a)anewsystem ofestablishing theguaranteed prices,
which willbebased onworld market trends and(b)theencouragement ofprivate stockholdings.
Question 33.
Willtheguaranteed prices for1997remain atthesame levels asfor1995and1996?
Answer:
Allguaranteed prices foragricultural products willremain atthesame levelasin1995
and1996 except forwheat. Forwheat guaranteed prices areexpected toriseslightly asadirect
consequence ofthetrends ontheworld market.
Question 34.
Isthere anyspecial reason whymilk hasnotbeen mentioned intheanswer to
Question130,whereasitisshownonpage6ofdocumentWT/ACC/SPEC/HRV/1,productssubject
toMarket Price Support?WT/ACC/HRV/27
Page12
Answer:
Milkwasnotmentioned intheciteddocument because milkprocessors agreed toapply
thGovernment 'srecommendation onguaranteed price andinpractice theproducers payatleastthat
price. Theguaranteed price formilkwas1.27Kunas perlitrebothin1995 andin1996.
Thelackofdomestic milksupply byCroatian producers (caused mainly bythewar)is
thebasic reason whythisproduct isnotincluded inthelistofagricultural products withguaranteed
prices.
Re:Answers toQuestions 123,130and154:
Question 35.
Theanswer toQuestion 123saysthatthe"total value offinancial incentives together
withinput subsidies represent somewhat more than4%ofthevalue oftotalagricultural output
in1995". Answers toQuestions 130and154saythat"about 8%ofthetotalvalue ofagricultural
output in1995 wasmarket asguaranteed prices". Please explain thedifference between these
twoanswers?
Answer:
Thedifference between theanswers toQuestion 123ontheonesideand139and154
ontheother refers tothefollowing.
Thetotalvalue offinancial incentives together withinput subsidies intheState budget
for1996was510million Kunas orslightly more than4%ofthevalue ofthetotalagricultural output
in1995 which wasestimated at11.3billion Kunas.
Intheanswer toQuestions 130and154itwasstated that"about 8%ofthetotalvalue
ofagricultural output wasmarketed atguaranteed prices". Thisfigure doesnothaveadirect connection
withthefigure onthevalue oftotalfinancial incentives. Itwasderived from thefigure "eligible
production andapplied administered price" inthetable DS:5 (Market Price Support) indocument
WT/ACC/SPEC/HRV/1.
Thetotalvalue ofagricultural output marketed atguaranteed prices in1995 wasnearly
707million Kunas without milkorapproximately 1805million Kunas withmilkincluded. Inrelative
terms itvaries from 6.25% to9.6% ofthevalue oftotalagricultural output in1995, i.e.7.93% on
average.
Re:Answers toQuestions 139and143
Question 36.
There seems tobesome contradiction intheanswers toQuestions 139and143.
CouldCroatiaconfirmthatallfeesforimportedagriculturalproductshavebeenabolished(whether
"special compensatory fees" or"variable protective fees")?
Answer:
TheRepublic ofCroatia confirms thatallfeesforimported agricultural products (special
compensatory feesandvariable protective fees)havebeenabolished withtheentry intoforce ofthe
newcustoms tariffon1July1996. Theduties forcertain agricultural andfoodproducts arecompound
duties, i.e.consist ofanadvalorem andaspecific dutyelement (seealsoanswer above).WT/ACC/HRV/27
Page13
IV.6-Government Procurement
Question 37.
Hasalawonpublic procurement already been adopted? Ifso,isanEnglish
translation available?
Answer:
TheLawonPublic Procurement wasadopted in1995. AnewLawwillbepassed by
mid-1997 andwillbeforwarded totheWTO Secretariat aftertheEnglish translation iscompleted.
Question 38.
Howisprocurement managed byutilities, companies granted amonopoly andprivate
companies controlled bypublic authorities?
Answer:
Answer tobeprovided later.
Question 39.
Apartfrominterestsofamilitaryorstrategicnature,couldexamplesofother"national
interests" mentioned inArticle 3(4)oftheDecree onProcedures forProcurement ofGoods be
given? What arethe"special purposes resources" and"special laws" referred toinArticle 3(5)
towhich theDecree isnotapplied?
Answer:
Answer tobeprovided later.
Question 40.
Howoften isthe"national preference" referred toinArticle 3(7)oftheDecree used?
Answer:
Answer tobeprovided later.
Question 41.
Why areservice contracts onlyconcluded bylimited orrestrictive bidding?
Answer:
Answer tobeprovided later.
Question 42.
Doplans existtoenlarge access totheGovernment service market forforeign bidders?
Answer:
Answer tobeprovided later.
Question 43.
Does anyCroatian lawmake provisions foroffset requirements?
Answer:
Answer tobeprovided later.WT/ACC/HRV/27
Page14
Question 44.
Isstatistical information available showing e.g.
-thesizeofthepublic procurement market asaproportion oftotaleconomy;
-thebreakdownofmethodused(openbidding,prequalification,LIB,piecequotationorshopping
anddirect contracting) andtheir respective values;
-thenumber oftender invitations published;
-theshare offoreign competitors participating intenders andthenumber/percentage ofcontracts
awarded tothem;
-thenumber ofcomplaints?
Answer:
Nostatistical dataisavailable.
Question 45.
Does Croatia plantosetupasystem ofelectronic tendering? When?
Answer:
Answer tobeprovided later.
Question 46.
Does Croatia have anyexisting purchasing agreements withthird countries?
Answer:
Answer tobeprovided later.
IV.7-State-trading Enterprises
Question 47.
Please explain whyCroatia does notconsider itnecessary tonotify anyofthe
enterprises listed intheresponses toQuestion 156and158under Article XVII oftheGATT 1994
orArticle VIIIoftheGATS.
Answer:
TheGovernment oftheRepublic ofCroatia will,upon accession totheWTO andin
accordance withArticle XVII oftheGATT andArticle VIIIoftheGATS, notify anyState-trading
enterprises aswellasanymonopolies orexclusive service suppliers thatmayexistatthattime.
IV.9-Subsidy Policy
Question 48.
Could Croatia please explain howthe"industry rehabilitation andreorganization
program" iscompatible withtheWTO Subsidies andCountervailing Measures Agreement, notably
withArticle 2thereof?
Answer:
The"Industry Rehabilitation andReorganization Program" fortheseven industrial
companies mentioned inthereply toQuestion 160wasadopted inviewofthefactthatthesecompanies
arelocated inanareawhich washeavily devastated during thewar. Weconsider themeasures taken
asan"assistance todisadvantaged regions" inthesense ofArticle 8.2(b) oftheSubsidies Code. In
addition andaspointed outintheabove mentioned reply, thecompanies inquestion willhavecompleted
theirrehabilitation andreorganization program within thenextfewmonths.WT/ACC/HRV/27
Page15
VI-Trade inServices
Banking andOther Financial Services
Question 49.
Croatia hasexpressed anintent tomaintain thecurrent reciprocity condition for
establishment inthebanking sector. Does Croatia accept that, should apermanent GATS
agreement onfinancial services beestablished, thereciprocity condition willhavetoberelinquished
atthelatest upon accession totheWTO?
Answer:
Croatia expects toseekanm.f.n. exemption, possibly onlyforalimited period oftime.
Telecommunications Services
Question 50.
Itismentioned thatamonopoly exists inbasic telecommunications services, butthat
there iscompetition invalue-added services. Itremains unclear whether there isanycompetition
inpractice andhowthiscompetition isregulated. Inthisrespect:
could Croatia confirm whether anylicences toprovide value-added services have been granted
tooperators other thanHPT;
could Croatia explain therespective roles oftheTelecommunications Council andtheMinistry
ofMaritime Affairs, Transport andCommunications inregulating thetelecommunications sector
andensuring access bynewoperators tothefixed network?
Answer:
TheTelecommunication Council grants concessions forproviding audiotex services.
ThecompetentauthorityforgrantingconcessionsforactivitiesinPublicTelecommunications
istheTelecommunication Council. TheTelecommunication Council ispublicly collecting offers or
inviting tenders forthegranting ofconcessions forengagement intheactivity ofPublic
Telecommunications. Theduration oftheconcession aswellasspecific conditions regarding theprice
andqualityofservicesaredeterminedbytheRegulationsonthePublicTelecommunicationConcessions,
which arefixed bytheproper Minister ontheproposal oftheTelecommunications Council
Onthebasis ofadecision oftheTelecommunications Council, theMinistry concludes
acontract ontheuseoftheconcession, provided anexamination establishes thattheconcessionaire
hasfulfilled theconditions regarding itsability torealize theprogrammatic, technical, technological,
spatial, financial andpersonnel conditions forpublic telecommunications activities.
Theconcessionaire shallhavetheright, should thetechnical conditions exist, tousethe
telecommunication infrastructure owned byotherlegalentities against payment ofactual costaccording
totheagreement between theconcessionaire andtheowners ofthetelecommunication infrastructure.
Acontract willbeconcluded fortheuseofthetelecommunication infrastructure. Should theowner
ofthetelecommunication infrastructure reject aconcessionaire 'srequest, theMinistry attherequest
oftheconcessionaire, shalldetermine thetechnical conditions andpassadecision which shallreplace
thecontract inwhole.WT/ACC/HRV/27
Page16
RE: DOCUMENT WT/ACC/HRV/13 -TBTISSUES
Question 51.
There areanumber ofaspects oftheCroatian system of"Import andExport Quality
Control ofGoods", which provides forinspection andmandatory certification onanumber of
imported non-alimentary products (thetextoftherelevant Actshould bemake available bythe
Croatian authorities forfurther scrutiny), which donotappear tobeWTO compatible. These
include:
(a) asystem ofstandards andoftechnical prescription oncertification andtesting to
ensure safety andconsumer protection, mostofwhich aremandatory. Thismeans ahugenumber
oftechnical barriers totrade;
(b) unclear procedures onthedesignation andcontrol oftheentities authorized tocarry
outmandatory product certification;
(c) extensive mandatory certification asadirect consequence ofmandatory standards,
onalonglistofindustrial products, some ofwhich arenotevenregulated under EClawforthe
virtual absence ofsafety risks (ceramics, plastics, tubes etc.).
Answer:
(a) ThenewLawonStandardization entered intoforceon10July1996. Inaccordance with
thisLaw, theexisting mandatory JUSstandards haveasof1January 1997 become voluntary. The
existing (voluntary) standards willbereplaced inthefuture bynewstandards based oninternational
standards (ISO, IEC, etc.)andEuropean standards.
(b) UnderArticle6oftheLawonImportandExportQualityControlofGoods,theinspections
attheborder arecarried outbymarket inspectors, whoareofficials oftheMinistry ofEconomy.
Thepreliminary testofproducts provided forunder Article 11.2oftheLawiscarried outbyqualified
organizations which areregistered withthecommercial courts. Thelistofproducts subject tosuch
preliminary testsiscontained indocument WT/ACC/HRV/22, pages 2-3(agricultural products) and
pages 10-12 (industrial products). Thesame testsarecarried outfordomestically produced products
andthere isnodiscrimination inthisrespect.
Question 52.
Does anaccreditation system exist?
Answer:
Croatia doeshaveanaccreditation system; thereare57technical regulations inCroatia,
twoofwhich wereadopted afterindependence in1991. Likeinthecaseofstandards, these technical
regulations willbechanged inthefuture soastobring themintoconformity withinternationally adopted
regulations orifthese donotexist, withEuropean regulations.
Question 53.
Does Croatia comply with therelevant international standards applicable tothe
designation andcontrol ofentities authorized tocarry outmandatory product certification?
Answer:
ThenewLawonStandardization doescomply withtherelevant international standards
applicable tothedesignation andcontrol ofentities authorized tocarry outmandatory product
certification. These provisions stipulated intheLawarepresently being implemented.WT/ACC/HRV/27
Page17
Question 54.
Information isgiven thataNewLawonStandardization should have been passed
inJune 1996 bytheCroatian Parliament providing forasystem ofinternationally compatible
voluntary standards andconformity assessment procedures. HasthisLawbeen adopted?
Answer:
ThenewLawonStandardization wasadopted on10July1996.
Question 55.
Towhich extent doesittakeintoaccount theconcerns listed inpoints (a)to(c)above?
Does it,asaconsequence, leadtorepealing orsoftening theapplication ofthe"Act
onImport andExport Quality Control ofGoods"?
Answer:
WhiletheLawonImportandExportQualityControlofGoodsremainsvalid,itsapplication
isnowlimited tothe88products stillsubject tothepreliminary testsmentioned above, anddoesnot
apply toallproducts imported intoCroatia anymore.
Inaddition, thenumber ofproducts towhich thequality control stillapplies islikely to
bereduced asthequality ofimported products improves.
Question 56.
Please provide thetextofthenewlaw.
Answer:
WewillsendanEnglish translation oftheLawtotheWTO Secretariat assoonasthe
translation iscompleted.
RE: DOCUMENT WT/ACC/HRV/15 -INTELLECTUAL PROPERTY REGIME
i.General
Question 57.
DoestheGovernmentofCroatiaintendtobecomeaMemberoftheRomeConvention?
Ifso,what isthetimeframe?
Answer:
TheRepublicofCroatiaintendstobecomeaMemberoftheRomeConventionafterhaving
enacted legalprovisions ontherights ofphonogram producers andbroadcasting organizations, most
likely in1997. Suchlegalprovisions shallbethebasis fortheapplication oftheRome Convention.
Question 58.
ItissaidthatCroatia willintroduce three separate laws withregard topatents,
trademarks, including service marks andindustrial designs. What istheconcrete timeframe
forthese laws? Could theGovernment ofCroatia explain themain elements inmore detail?
Areanydrafts available?WT/ACC/HRV/27
Page18
Answer:
Afirstdraftofanewpatent lawisstillunder discussion within theCroatian Government.
Itisbased ontheWIPO model lawandtherelevant Austrian legislation andwillbemade available
assoonaspossible. Laws ontrademarks andindustrial designs willbedrafted laterin1997.
ii.Copyright andRelated Rights
Question 59.
Could theGovernment ofCroatia name andexplain thecases when "persons may
alsobecome owners ofcopyright byvirtue oflaw..."?
Answer:
Persons maybecome owners ofcopyright byvirtue oflawincases ofthecreation of
thework inthecourse ofemployment andincases oftheorganization ofcollective works, e.g.the
creation ofdatabases orencyclopedias.
Question 60.
Arethere anylimitations totheexclusive right? Ifyes,please explain.
Answer:
Limitations totheexclusive right exist particularly forthebenefit ofbroadcasting
organizations which canbroadcast works recorded onaphonogram without authorization. Apart from
thatthere arecases offreeuse(exploitation) ofthework mostly forpersonal use,forthepurpose of
teaching, science (e.g.citations) andpublic information. Such cases areprecisely regulated bythe
Law.
Question 61.
Itissaidthatspecial terms ofprotection apply foranonymous andpseudonymous
works. Does thismean thattheterm ofprotection is25years? Ifyes,doestheGovernment of
Croatia intend toamend itslawwhen acceding totheWTO (Article 12oftheTRIPS Agreement
speaks about 50years from theendofthecalendar yearofpublication ormaking)?
Answer:
Special terms ofprotection ofanonymous andpseudonymous works are50years from
thedaythework hasbecome available tothepublic, and25years onlyforphotographic films,
photographic works andfortheworks ofapplied arts.
Question 62.
Could theGovernment ofCroatia explain the"special provisions onciviljudicial
protection" contained in"theLaw"?
Answer:
Special provisions onciviljudicial protection contained intheLawconcern thepossibility
ofclaim (destruction ormodification ofinfringing objects, inhibition ofthecontinuation ofinfringement,
indemnification, publication ofthedecision inthemeans ofpublic information attheexpense ofthe
defendant) andprovisional measures (provisional deprivation ofobjects, inhibition ofcontinuation of
infringement).
Question 63.
Itissaidthattheprovisions ontheprotection ofperformers aremostly inaccordance
with theRome Convention. Could theGovernment ofCroatia explain where itseesthe
shortcomings?WT/ACC/HRV/27
Page19
Answer:
TheLawoftheRepublic ofCroatia protects theperformers eveninahigher degree than
theRome Convention, because itprotects themalsoasregards thefixation ofapicture orofboththe
picture andthesound.
Question 64.
Does theGovernment ofCroatia intend tointroduce asystem ofprotection of"other
neighbouring rights" besides performers, such asproducers ofphonograms andbroadcasting
organizations? Ifyes,explain themain elements andthepossible timeframe.
Answer:
TheRepublic ofCroatia intends tointroduce asystem ofprotection forproducers of
phonograms andbroadcasting organizations incompliance withtheRome Convention and,ifpossible,
in1997.
Question 65.
What arethefines fortheinfringement oftherights ofanauthor andperformer?
Answer:
Thefinesfortheinfringement oftherights ofanauthor andperformer arepayable in
thenational currency amounting uptoDEM 70000.
iii.Geographical Indications
Question 66.
Could theGovernment ofCroatia explain itspresent system ofprotection?
Answer:
TheIndustrial Property Law(articles 37-43) provides thattheCroatian Chamber of
Commerce shalldesignate:
geographical names which shallbeprotected byappellations oforigin; products which
maybeputtothemarket under agiven appellation oforigin; locations orregions from
which products puttothemarket withappellations oforigin originate; production
requirements aproduct must fulfil inorder tobeputtothemarket withanappellation
oforigin; thewaytheproducts should beputtothemarket; andfurther requirements
forthegrant oftherighttousegiven appellations oforigin.
Anappellation oforigin shallbeestablished byentering thegeographical name andkind
ofproduct towhich thatname relates intotheregister ofprotected appellations oforigin keptbythe
State Intellectual Property Office. Theentry intotheregister shallbecarried outexofficio onthe
proposal oftheCroatian Chamber ofCommerce. Theappellation oforigin ofaproduct mayalsobe
established infavour ofaforeign person, under aninternational agreement onthereciprocal protection
ofappellations oforigin concluded oracceded tobytheRepublic ofCroatia.
Question 67.
What isthetimeframe forthenewlawmentioned inWT/ACC/HRV/15? Could
Croatia explain itsmain elements? Isthere adraft available?
Answer:
Seereply toQuestion 2under General.WT/ACC/HRV/27
Page20
iv.Industrial Designs
Question 68.
Could theGovernment ofCroatia explain howtextile designs areprotected?
Answer:
Textile designs areprotected cumulatively bytheIndustrial Property Lawasamodel
orsample, andbytheCopyright Lawasthework ofapplied artandindustrial design. According
totheIndustrial Property Law theapplicant shall indicate whether heseeks protection forthe
two-dimensional design (sample) orthethree-dimensional one(model).
v.Patents
Question 69.
Arethere anyprovisions oncompulsory licensing? Please explain.
Answer:
Theexisting Industrial Property Law(NNRHno.53/91, 19/92 and61/92) contains
provisions oncompulsory licensing. According toArticle 139iftheowner ofapatent, either himself
ofthrough athirdparty, doesnotwork orinsufficiently works apatented invention intheRepublic
ofCroatia, therighttousetheinvention maybegranted toanother person under anobligation topay
compensation tothepatent owner. According totheLawitshallbeconsidered thattheowner ofa
patent doesnotuseorinsufficiently usestheinvention ifherefuses tolicence toother persons theright
tousetheprotected invention orimposes unjustified conditions onthem, orifthedomestic demand
forproducts manufactured according totheprotected invention istoagreat extent satisfied by
importation, oriftheimportation ofthose products hampers orobstructs theirindustrial application
inthecountry. Acompulsory licence mayalsobegranted when aninvention protected byapatent
cannot beworked, either initsentirety orpartially, without theuseofaninvention protected byan
earlier patent,and thelaterinvention, which constitutes asignificant technical advance, isofspecial
importance fortheeconomy orforcertain general social purposes. Arequest forthegrant ofa
compulsory licence maynotbesubmitted earlier thanfouryears afterthefiling dateofthepatent
application, orearlier thanthree years afterthedateorthepatent grant, ifthistermexpires later.
Atthesame timeplease notethat,inspiteoftheexisting legal provisions, nolicence
hasbeenissued inpractice.
Question 70.
Does"working apatent" include theimportation ofproducts forwhich suchapatent
isgranted?
Answer:
Thestated request hasbeenanswered above.
Question 71.
What istheamount offeesandcharges which have tobepaidforthegrant ofa
patent?
Answer:
With regard totheprocedural charges, enclosed please findtheLawonAdministrative
feesintheField ofIndustrial Property, aswellastheDecision ontheProcedure Special Charges and
Information Service Charges oftheStateIntellectual Property Office, where among others theamounts
offeesandcharges forthegrant ofapatent areestablished.WT/ACC/HRV/27
Page21
vi.Protection ofUndisclosed Information
Question 72.
Could theGovernment ofCroatia explain howtestorother dataisprotected inthe
context ofapproving themarketing ofpharmaceutical orofagricultural chemical products?
Answer:
Testandotherdatarespectivelyinthecontextofapprovingthemarketingofpharmaceutical
orofagriculturalchemicalproductsareprotectedbyspecialregulations(by-laws)appliedbytheMinistry
ofHealth andtheMinistry ofAgriculture andForestry oftheRepublic ofCroatia, which byitscontent
doesnotdiffer from theusual provisions applied forsuchapurpose allovertheworld.
viii. Enforcement
Question 73.
What isthetimeframe forthenewLawonEnforcement? Could theGovernment
explain inmore detail itsmain elements? Isitpossible toreceive adraft text?
Answer:
ThenewLawonEnforcement came toforce on12August 1996. Liketheearlier Law
onExecutive Procedure, theLawonEnforcement contains provisions onprovisional measures ensuring
thetermination ofrights 'violations (Article 298and299)bytheapplication ofwhich detrimental
consequences resulting fromtheunlawful activities, including inthefieldofintellectual property, can
beprevented. TheLawonEnforcement willbesentsoon, afteritstranslation.
Question 74.
What isthetimeframe fortheenvisaged lawonborder control? What areitsmain
elements? Istheunderstanding correct thatthislawisdistinct from thenewLawonEnforcement?
Answer:
TheLawonBorder Control hasnotyetbeendrafted. Itisplanned tobecarried out
i.e.enacted within fiveyears atthelatest counting fromthedaytheWTO Agreement comes intoforce
forCroatia. Itsmain elements canbediscussed onlyaftertheelaboration thereof.
Thementioned Lawwillbedistinct from thenewLawonEnforcement.
Question 75.
Under thesection onciviljudicial procedures andremedies Croatia describes that
thecommercial courts arecompetent todealwith"...infringements against equality intheintegral
market oftheRepublic ofCroatia". Could theGovernment ofCroatia explain themeaning of
thisclause?
Answer:
Apart fromtheprotection ofintellectual property, thecommercial courts intheRepublic
ofCroatia arealsocompetent fordisputes arising fromtheactsofunloyal competition, monopolistic
agreements andinfringements against equality intheintegral market oftheRepublic ofCroatia. Detailed
provisions ontheabove mentioned unlawful activities arecontained intheLawontheProtection of
Market Competition (NNRHno.48/95) thebasicfunction ofwhich istoprevent monopolistic conduct
andoccurrence ofunallowed concentrations inthemarket. Infringements against equality intheintegral
market oftheRepublic ofCroatia isbasically theinfringement ofthemarket freecompetition including
different forms ofprevention andlimitation ofentrepreneurial freedom andcontractor 'sactivities in
thecirculation ofgoods andservices onthemarket.WT/ACC/HRV/27
Page22
Question 76.
Could theGovernment ofCroatia explain inmore detail thepresently existing
provisions on"provisional measures"?
Answer:
Provisional measures canbeordered bycourt ontherequest oftheinfringed party also
during thelegalproceedings aswellasbefore andafterit.Itisregulated byArticle 442oftheLaw
onLegal Proceedings. There areseveral kinds ofprovisional measures andforintellectual property
thecorresponding oneis"inhibition tothedebtor toperform activities which canbedetrimental for
thecreditor". Thecumulative ordering ofseveral provisional measures isalsopossible (ifitisnecessary
incertain circumstances).
Question 77.
Arethere anyprovisions inCroatian lawwhich giveaparty theright toaskfor
injunctions (Article 44oftheTRIPS Agreement)?
Answer:
Intheframework ofintellectual property protection aparty hasthepossibility toaskfor
thecourt ordering prohibition ofcertain activity bywhich itsintellectual property rightisunlawfully
infringed, andwhatisachieved bysocalled "provisional measures" thefunction ofwhich istoprevent
momentary further unlawful conduct, andwhich includes thedecision fromArticle 44oftheTRIPS
Agreement.
RE: DOCUMENT WT/ACC/HRV/19 -CUSTOMS VALUATION
Question 78.
ItwouldseemthatCroatiahasmisinterpretedtheprovisionsoftheCustomsValuation
Agreement ontransactions between related parties (Article 2oftheAgreement).
Theprice comparison mechanism provided forbyArticle 2(b)oftheAgreement is
afacilitation measure tobeinvoked onlyattherequest oftheimporter. Itshould notbeused
bytheadministration asacondition foracceptance oftransactions between related buyers and
sellers.
Theuseof"test values" attheelection oftheimporter onlyismade clear inthe
corresponding Interpretative Note which isalsopartoftheCustoms Valuation Agreement.
Croatiacouldremoveanyambiguityfromtheirlawbyinclusionoftheaforementioned
Interpretative Note initsrules.
Answer:
Article 10oftheCroatian LawontheConditions andMethod ofDetermining Tariff Bases
(thetextofwhich wassubmitted totheWorking Party inJuly1995, document WT/ACC/HRV/4/Add.1)
provides that"...thecontract price shallnevertheless beaccepted asthetariffbaseifthebuyer proves
thatsuchapriceapproximates toeither ofthefollowing prices ...".Thisformulation clearly indicates
thattestvalues maybeusedonlyattherequest oftheimporter, asprovided forinArticle 2.1(b) and
thecorresponding Interpretative NoteoftheAgreement onCustoms Valuation. Wetherefore consider
theCroatian legislation tobeinfullconformity withtheWTO Agreement.WT/ACC/HRV/27
Page23
RE: DOCUMENT WT/ACC/HRV/20 -INTERNAL TAXATION REGIME
Question 79.
Please indicate forwhich, ifanyoftheinternal taxes mentioned inthisdocument,
fullnational treatment doesNOT apply.
Willproduct exemptions fortheVAT beapplied onwithfullrespect tothenational
treatment principle?
Answer:
Atthepresent time, theexcise taxforcertain products doesnotconform withthenational
treatment requirement. Forfurther details seereplies given above. TheVAT willfullyrespect the
national treatment requirement.
RE: DOCUMENT WT/ACC/HRV/23 -EXPORT QUOTAS FOR 1996
Question 80.
Theresponse toQuestion 22indocument WT/ACC/HRV/11 states thatunder the
newLawonTrade theconditions forimposing export quotas areasfollows: "inexceptional cases,
export quotas maybesetforthepurpose ofprotecting renewable natural resources".
Please explain thereasons fortheimposition ofexport quotas fortheitems in
WT/ACC/HRV/23 inthelightofthiscondition.
Does Croatia wish tomaintain anyofthese export quotas after WTO accession.
Ifso,please indicate theWTO justification forthequotas.
When willtheremaining export quotas listed inthisdocument beabolished?
Answer:
Answer no.22from document WT/ACC/HRV/23 states precisely asfollows:
"Inexceptional cases, export quotas maybesetupforthepurpose ofprotecting
unrenewable natural resources" andnot"...renewable resources".
TheGovernment oftheRepublic ofCroatia determined export quotas foralimited number
ofproductsasatemporarytradepolicymeasurewiththeaimofpreservingunrenewablenaturalresources
fromexcessiveexploitationortheresourcesoflonglastingrenewal.Theintentionistopreventshortages
ofthose products forpopulation aswellasfortheindustry onthedomestic market.
Forinstance:
i. theexport quotas aredetermined forcrude oilandnatural gas.Approximately 23%of
theCroatian production ofcrude oilandnatural gasarelocated intheregion ofEastern Slavonia.
During thelastfiveyears thesecapacities havenotbeenavailable andfurthermore wehavenocomplete
dataontheirstateandpossibility forfuture exploitation. Withthereintegration oftheEastern Slavonia,
theabolishment ofprotection measures, including export quotas willbeconsidered;
ii. export quotas arealsodetermined forwood. Thereason isthatduring theperiod offour
years until1995, 30%oftheCroatian woods could nothavebeenusedfortheneeds ofthewood
processing industry. Atthesame time, alotofprocessing capacities weredestroyed (estimated warWT/ACC/HRV/27
Page24
damage intimber processing plants amounts to73million US$). Stillnowabout 8million m3pulp
ofwood isnotavailable forexploitation asitislocated inEastern Slavonia;
iii. thesituation issimilar intheleather industry whose levelofproduction decreased inthe
lastfiveyears asadirect result ofahugedecrease of60%incattle breeding. Thathashadanegative
impact onthesupply oftanneries (40ofthem) some ofthem were evenbrought tobankruptcy.
Theexportquotasaredeterminedonlyexceptionallyforthepurposeofpreventingshortages
onthelocalmarket, hence, theyaretemporary measures. However, ifafterCroatia 'saccession to
theWTO, itwould benecessary tocontrol theexportation ofthese products, Croatia willconsider
thepossibility toimplement other trade policy measures inconsistency withtheWTO ruleinorder
toprovide thenecessary rawmaterials forthedomestic market. Remaining export quotas willbe
abolished gradually depending ontheconsolidation intheproduction, parallel withtheaccession of
Croatia totheWTO.
RE: DOCUMENT WT/ACC/HRV/24 -RULES OFORIGIN
Question 81.
Please provide anindication ofthetimetable fordeveloping thenewrules oforigin
indicated inWT/ACC/HRV/24.
Answer:
NewlegislationonrulesoforiginindicatedinWT/ACC/HRV/24willbedevelopedduring
1997.
RE: DOCUMENT WT/ACC/HRV/25 -IMPORT LICENSING
Question 82.
Please explain theWTO justification foracompulsory import licensing system for
products likeirontubes andbars, combine harvesters forgrain andcorn, andengine power above
45to167kW.
Answer:
Import licenses forirontubes andbars, combine harvesters forgrain andcorn, engine
power above 45to167kW areintroduced asatemporary measure forthereason ofmonitoring the
import ofthose products. Theother reason isthenecessity ofcontrol overimport prices andquantities
asthestatistic dataarenotreliable. Also, ithappens thatthecombine harvesters imported intoCroatia
aresometimes ten,fifteen ormore years old,soitwasnecessary tomonitor their import for
environmental purposes antheprotection ofhealth oftheusers ofthose landsecurity harvesters.
In1997, theCroatian Government willconsider, afterhaving analyzed theimport of
those products, theabolition ofthelicenses fortheabove mentioned products.
RE:DOCUMENT WT/ACC/SPEC/HRV/1 -DOMESTIC SUPPORT AND EXPORT SUBSIDIES
INTHE AGRICULTURAL SECTOR
Allreferencestoproductsotherthanagriculturalshouldbedeletedfromthedocument
(forinstance Sardines andFuelforFishery areindicated). Under theWTO Agreements, fishand
fishproducts arenotconsidered tobeagricultural products.WT/ACC/HRV/27
Page25
Question 83.
What isthevalue oftotalagricultural production inthereporting period (1995)?
Croatia hasstated (inthedocument onquestions andanswers, WT/ACC/HRV/11)
thatitdoesnotgrant, anddoesnotintend togrant, export subsidies. Croatia should specify
thisaccordingly intherelevant table.
Answer:
Thevalue oftotalagricultural production in1995 wasestimated at11755000Kunas.
TheGovernment ofCroatia willinduecourse make therelevant entries in,itsschedules ofconcessions
ongoods, relating toexport subsidies.WT/ACC/HRV/27
Page26
ANNEX: TURNOVER TAX
TheGoods andServices Turnover Tax
II.Turnover taxongoods
1.Theobject oftaxation
Article 5
Theturnover taxongoods ispaidontheturnover ofgoods which aretheobject offinal
consumption.
Article 6
1) Covering theturnover ofgoods intended forfinalconsumption, weacknowledge every sale
ofproducts, unless stated otherwise inthisAct.
2) Theturnover ofgoods under thisActmeans also
1. imports, including temporary imports;
2. taking ofownproducts, which were made orpurchased byalegal person, forthe
purpose ofownfinalconsumption;
3. thegiving ofproducts freeofcharge (cession, exchange, etc.)conducted byalegal
person;
4. thedeficit ofgoods withalegalperson, excluding adeficit caused through anActof
God;
5. outlay (ullage, waste, defect, breakage) which isgreater thantheoutlay;
6. usage ofproducts which acitizen, oralegalperson, i.e.authorised professional section
oftheChamber ofCommerce;
7. thegiving freeofcharge (cession, exchange etc.)ofamotor vehicle oraboat,
conducted byacitizen, ifsuchagiving isnotsubject tosome other typeoftaxation.
Giving inthefirstlineofinheritance isnotconsidered tobeaturnover ofgoods under
thefirstprovision.
Article 7
Notconsidered asturnover ofgoods intended forfinalconsumption:
1) saleofgoods, except thesaleoftobacco products, alcoholic beverages, non-alcoholic carbonated
andartificial non-alcoholic beverages, mineral andcarbonated waters andcoffee (raw, roasted,
ground andextracts) topersons listed inarticle 4ofthisAct,which dealintrade, andwhich
purchase these products forthepurpose ofsale;
2) saleofgoods, except thesaleoftobacco products, alcoholic beverages, non-alcoholic carbonated
andartificial non-alcoholic beverages, mineral andcarbonated waters andcoffee (raw, roasted,
ground andextracts) topersons listed inarticle 4ofthisAct,which dealincatering services,
andwhich purchase these products forthepurpose ofsale;
3) saleofusedobjects directly between private persons andbymeans ofcommission sales,
excluding sales andthegiving ofusedcarsfreeofcharge, other motor vehicles andboats,WT/ACC/HRV/27
Page27
aswellassalesofagricultural products, conducted between private persons overmarket places
andfairs;
4) import ofgoods, except thesaleoftobacco products, alcoholic beverages, non-alcoholic
carbonated andartificial non-alcoholic beverages, mineral andcarbonated waters andcoffee
(raw, roasted, ground andextract), forthepurpose offurther sale;
5) Sales topersons listed inArticle 4ofthisAct,which conduct overhauls, repairs andservicing
ofproducts forthepurpose ofinstalling themintoproducts which arebeing repaired orserviced.