G/STR/N/16/UKR  
 
13 July 2016  
(16-3746)  Page: 1/5  
Working Party on State Trading Enterprises  Original: English  
 
 STATE TRADING 
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVII:4(A) OF THE 
GATT 1994 AND PARAGRAPH 1 OF THE UNDERSTANDING ON 
THE INTERPRETATION OF ARTICLE XVII 
UKRAINE  
The following communication, dated 8 July 2016, is being circulated at the request of the 
Delegation of Ukraine. 
 
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Pursuant to the provisions of the Article XVII: 4(a) of the GATT 1994 and paragraph 1 of the 
Understanding on the Interpretation of the Arti cle XVII, Ukraine submits herewith its updated 
notification concerning the State Enterprise of liqueur and alcoholic beverage industry "Ukrspyrt" 
(hereinafter – State Enterprise "Ukrspyrt").  
I.  THE STATE ENTERPRISE OF LIQUEU R AND ALCOHOLIC BEVERAGE INDUSTRY 
"UKRSPYRT"  A.  IDENTIFICATION OF STATE TRADING ENTERPRISES 
 
16 Gagarina Street; Brovary, 07400, 
Kiev Region 
Tel (fax): (044)278-58-02  
Mailing address: 
 
1 Grinchenka St. Kyiv, 01001, Ukraine Tel (fax): (044) 278-58-02 
e-mail: info@ukrspirt.com  
http://www.ukrspirt.com/   
 
B.  DESCRIPTION OF PRODUCTS AFFECTED 
 Undenatured ethyl alcohol of an alcoholic strength by volume of 80% vol. or higher; ethyl alcohol 
and other spirits, denatured, of any strength (UKTZED
1 – 2207). 
 
                                               
1 UKTZED is the Ukrainian Foreign Economic Activi ty Commodity Classification, based on Harmonized 
System 2012. G/STR/N/16/UKR 
 
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  II.  REASONS AND PURPOSE FOR INTROD UCING AND MAINTAINING STATE TRADING 
ENTERPRISES  A.  REASON OR PURPOSE FOR ESTABLISHING AND/OR MAINTAINING STATE TRADING 
ENTERPRISE 
 The State Enterprise of liqueur and alcoholic beve rage industry "Ukrspyrt" was founded according 
to the Resolution of the Cabinet of Minister s of Ukraine as of 28 July 2010 No. 672 "On 
establishment of the State Enterprise of liqueur and alcoholic beverage industry" to increase the 
efficiency of state enterprises of liqueur and alcoholic beverage industry and to improve the 
management system in the mentioned branch. 
 
B.  SUMMARY OF LEGAL BASIS FOR GRANTING THE RELEVANT EXCLUSIVE OR SPECIAL RIGHTS OR PRIVILEGES, INCLUDING LEGAL PROVISIONS AND SUMMARY OF STATUTORY OR 
CONSTITUTIONAL POWERS 
 According to the paragraph 1 of the Article 2 of the Law of Ukraine as of 19 December 1995 
No. 481/95-BP "On state regulation of production , and circulation of ethyl, cognac and fruit 
alcohol, alcoholic beverages and tobacco goods" the production of ethyl alcohol (including the alcohol as medical product), rectified grape ethyl alcohol and rectified fruit ethyl alcohol can be performed only by the state enterprises. The production of bio-ethanol can be carried out by 
enterprises of all patterns of ownership, which are granted corresponding licenses. 
 Paragraph 1 of the Article 14 of the mentioned La w says that import, export and wholesale trade 
of ethyl alcohol, ethyl rectified grape alcohol and ethyl rectified fruit alcohol can be carried out only 
by state enterprises (organizations), which are auth orized by the Cabinet of Ministers of Ukraine. 
The wholesale of ethyl alcohol meant for medicine and veterinary medicine can be carried out by 
medical institutions, business entities and veterinary  medicine supplying companies, irrespective of 
patterns of ownership, which are granted a corresponding license. The Cabinet of Ministries of Ukraine has a register of the mentioned medical institutions, business entities and veterinary 
medicine supplying companies. 
 
According to paragraph 10 of the Article 14 of th e mentioned Law, the enterprises – the producers 
of ethyl alcohol, exports it through the state ente rprises (organizations), which are authorized by 
the Cabinet of Ministers of Ukraine and granted a corresponding export license. 
 According to the paragraph 11 of the Article 14 of  the mentioned Law, it is foreseen that the 
enterprises – the producers of ethyl alcohol sell it to the national consumers through the state 
enterprises (organizations), which are authorized by the Cabinet of Ministers of Ukraine and granted a corresponding wholesale license.  
According to the paragraph 1 of the Article 15 of the mentioned Law, import, export and wholesale 
trade of alcoholic beverages can be carried out by entities of all patterns of ownership having appropriate license. 
 
III.  DESCRIPTION OF THE FUNCTIONIN G OF THE STATE TRADING ENTERPRISE  
 
A.  SHORT DESCRIPTION OF THE STATE ENTERP RISE OF LIQUEUR AND ALCOHOLIC BEVERAGE 
INDUSTRY "UKRSPYRT"  Formation of the State Enterprise of liqueur and al coholic beverage industry "Ukrspyrt" is based on 
the property of the Concern of liqueur and spir its industry "Ukrspyrt", state enterprises and 
associations of alcohol and alcoholic beverage industry and in the result of restructuring of state enterprises and associations of alcohol and alco holic beverage industry under authority of the 
Ministry of agrarian policy and food of Ukraine, by joining to the State Enterprise "Ukrspyrt" and 
by separation of the property, which is used for production of excisable product, and transferring 
such property to the State Enterprise "Ukrspyrt". 
 
The State Enterprise "Ukrspyrt" is the successor of the Concern of liqueur and spirits industry "Ukrspyrt".  G/STR/N/16/UKR 
 
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  The main activity of the State Enterprise "Ukrspyrt" is distillation, rectification and mixing of 
spirits.  B.  SPECIFICATION OF EXCLUSIVE OR SPECIAL RIGHTS OR PRIVILEGES ENJOYED BY THE STATE 
TRADING ENTERPRISE 
 The State Enterprise "Ukrspyrt" is responsible for the export of ethyl alcohol (ethanol) (UKTZED 
2207) and wholesale trade in ethyl alcohol and fruit alcohol (UKTZED 2207) according to the 
Resolution of the Cabinet of Ministers of Ukrain e as of 28 July 2010 No. 672 "On establishment of 
the State Enterprise of liqueur and alcoholic beverage industry".  
The State Enterprise "Ukrspyrt" produces and sells ethyl alcohol and alcohol-based substances on 
the basis of:  
- License on production of ethyl alcohol (ser ies AE No. 297379, reg. number 171), issued by 
the State Fiscal Service of Ukraine, valid from 15 October 2015 till 15 October 2020;  
 
-  License for wholesale trade in ethyl alcohol (series AE No. 297267, reg. number 100305), 
issued by the State Fiscal Service of Ukraine, valid from 2 September 2015 till 2 September 2020; 
 
-  License for ethyl alcohol, cognac and fruit alcohol export (series AS No. 000040, reg. 
number 1500000100104), issued by the Ministry  of Economic Development and Trade of 
Ukraine, valid from 4 September 2015 till 4 September 2020. 
 
C.  TYPE OF ENTITIES OTHER THAN THE STATE TRADING ENTERPRISE THAT ARE ALLOWED TO ENGAGE IN IMPORTATION/EXPORTATION AND CONDITIONS FOR PARTICIPATION 
 
Import, export and wholesale trade of ethyl alcoho l and fruit alcohol, ethyl rectified grape alcohol 
and ethyl rectified fruit alcohol can be carried out only by state enterprises (organizations), which are authorized by the Cabinet of Ministers of Uk raine and granted a corresponding license, except 
for the wholesale of ethyl alcohol meant for medicine and veterinary medicine, which can be 
carried out by medical institutions, business entities and veterinary medicine supplying companies irrespective of patterns of ownership, wh ich are granted a corresponding license. 
 
D.  HOW IMPORT/EXPORT LEVELS ARE ESTABLISHED BY THE STATE TRADING ENTERPRISE  
For establishing export levels the State Enterprise "Ukrspyrt" considers international prices and 
commercial reasoning.  E.  HOW EXPORT PRICES ARE DETERMINED 
 
In the process of export price assessment the St ate Enterprise "Ukrspyrt" focuses on the price 
established in the market economy and competition.  In such circumstances, the profitability for 
each contract depends on the market situation, namely, on results of negotiations with potential 
customers, which establish their own prices based on the cost of similar products of the competitive manufacturers. 
 
F.  HOW ARE YOU IDENTIFYING RESALE PRICE OF IMPORTED GOODS  The State Enterprise "Ukrspyrt" neither conduc ts import, nor resales of imported products. 
 
G.  WHETHER LONG-TERM CONTRACTS ARE NEGO TIATED BY THE STATE TRADING ENTERPRISE. 
WHETHER THE STATE TRADING ENTERPRISE IS USED TO FULFILL CONTRACTUAL OBLIGATIONS 
ENTERED INTO BY THE GOVERNMENT 
 No long-term contracts are negotiated by the State Enterprise "Ukrspyrt". The State Enterprise is 
not involved in fulfilling contractual obligations entered into by the Government. 
 G/STR/N/16/UKR 
 
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  H.  SHORT DESCRIPTION OF THE STRUCTURE OF THE MARKET 
 Unless the State Enterprise "Ukrspyrt" more than forty companies of liqueur and alcoholic beverage industry can produce ethyl alcohol and alcohol-based products. 
  
  G/STR/N/16/UKR  
 
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IV.  STATISTICAL INFORMATION 
 
TABLE II 
STATE TRADING: THE STATE ENTERPRISE OF LIQUEUR AND ALCOHOLIC BEVERAGE INDUSTRY "UKRSPYRT" 
STATISTICAL INFORMATION, EXPORTS, 2015 
Description of product(s) 
(including HS 
number(s)) Total quantity 
exported 
(thousand 
decalitres)* Quantity exported by 
state trading 
enterprise 
(thousand decalitres) Average 
procurement 
price Average 
representative 
domestic sales price 
(UAH/decalitre) Average export 
price  
(US dollar/ 
decalitre) National 
production 
(thousand 
decaliters)* 
1 2 3 4 5 6 7 
Undenatured ethyl alcohol of an alcoholic strength by volume of 80% vol. or higher (UKTZED 2207 10 00), which includes: 242.4 241.2    10 777 
Undenatured ethyl 
alcohol of an alcoholic strength by volume of 80% vol. or higher not for medical use and pharmaceutical production   149.1 ** 154.69 6.9  
Head fraction of ethyl 
alcohol  92.1 ** 48.0 2.54  
  
* Trade statistics of Ukraine is available at http://www.ukrstat.gov.ua/ . 
** The State Enterprise "Ukrspyrt" does not conduct procurements. The State Enterprise "Ukrspyrt" has an ethyl alcohol export l icense. Export of ethyl 
alcohol is conducted through the foreign trade contracts between the State Enterprise "Ukrspyrt" and foreign trade partners or based on the previously 
concluded commission agreements, where the State Enterprise "Ukr spyrt" is a commission agent and other producing enterprises ar e consigners. 
 
 
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