WT/REG353/3  
 
20 July 2017 
(17-3995) Page: 1/5 
Committee on Regional Trade Agreements  Original: English  
 
DEEP AND COMPREHENSI VE FREE TRADE AREA C ONCLUDED AS A PART O F  
THE ASSOCIATION AGRE EMENT BETWEEN THE EUROPEAN UNION  AND UKRAINE  
(GOODS AND SERVICES ) 
QUESTIONS AND REPLIE S 
 The following communication, dated  20 July 2017, is being circulated at the request  of the 
delegations of the European Union  and Ukraine . 
 
 This document reproduces the follow -up question s addressed to the Parties following 
the 85th Session of the CRTA and the response s submitted.  
 
 
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Question s from the delegation of the Russian Federation  
 
1.1.  As indicated in para 1.14 of the reply, "both sides carry out discussions on approval 
of the SPS strategy ".  
 When will the Strategy be finally approved? Where will it be possible to get 
knowledge of it? What legislative acts already ex ist and what are to be approved in this 
sphere? What is the schedule for the adoption of by -laws?  
 
 Chapter IV (Sanitary and Phytosanitary Measures - SPS) of Title IV "Trade and trade -related 
issues" of the EU -Ukraine Association Agreement (AA) and its De ep and Comprehensive Free Trade Area 
(DCFTA), commits Ukraine to reform its food safety system by approximating it to the EU one. To this 
end, Ukrainian government approved - by the Decree of the Cabinet of Ministers of Ukraine No. 228 -p. of 
24 February 20 16 - a list of EU legislation to which Ukraine shall approximate its domestic law by the 
declared deadlines (in years 2017 -2021) in line with its commitments under the AA (the comprehensive 
strategy for the implementation of Chapter IV related to SPS). Thi s document will be jointly adopted by a 
Decision of the EU -Ukraine Sanitary and Phytosanitary Management Sub -Committee in autumn 2017, 
upon finalization of internal procedures by both parties. Once adopted by the Sub -Committee, the 
Decision will be subsequ ently published in the Official Journals of the both parties and the list of legal acts 
for approximation will be added as Annex V to the Association Agreement.  
 
1.2.  On 18 M ay 2017 under the Comprehensive Strategy of the implementation of the 
chapter IV (sanit ary and phytosanitary measures) of "Trade and issues related to trade" 
the Association Agreement between Ukraine and the EU, Verkhovna Rada adopted the 
Law of Ukraine "On state control, which is carried out in order to verify Compliance with 
the legislatio n on the safety and quality of food and feed, animal health and welfare" 
(registration No. 0906), which continues to reform the system of state food safety 
control and requires the adoption of more than 40 bylaws.  
 How is it planned to organize work on th e adoption of bylaws? Which bylaws have 
already being worked out and which of it is planned to adopt? When will they be 
accepted and in accordance with which schedule? How is the health and welfare of 
animals and food safety guaranteed in the absence of im plementing acts in Ukraine 
today?  
 WT/REG353/3  
 
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   The Law of Ukraine No. 2042 -VIII "On the state control of compliance with law concerning 
foodstuff, forages, by -products of animal origin, health and wellbeing of animals " adopted on May 18, 
2017 (hereinafter - the Law) is the legal basis to verify if the market operators comply with legislation 
concerning foodstuff, forages, by -products of animal origin, health and wellbeing of animals during their 
import into the customs territory of Ukraine. The Law also provides for t he adoption in the future of 
implementing acts which take into account the requirements of the EU legislation related to the activities 
of authorized persons  in relevant areas (and ensuring animals' welfare in accordance with the aims 
defined in the AA.  
 
 In regards to the regulation and handling of by -products, the Law of Ukraine "On by -products of 
animal origin not intended for human consumption" No. 287 -VIII was adopted on 7 April 2015. The Law 
defines the organizational and legal principles of activity of individual and legal entities, related to the 
formation, collection, transportation, storage, processing, recycling and removal of by -products of animal 
origin not intended or found unfit for human consumption, also processing products and by -products o f 
animal origin not intended for human consumption processing.  
 
1.3.  Regarding the answer in paragraph 1.6 of document WT/REG353/2:  
 From the explanations given, however, it is not clear what is the mechanism of 
making decisions on amended the Ukrainian legisla tion of changes in the EU legislation, 
what is the priority, what is the time lag between the two events, how is the activity 
organized, how is financing carried out, how is the public sharing and in what terms (the 
question of transparency), what happens if changes in the EU legislation that Ukraine in 
accordance with Articles 56.5 should make in its legislation will conflict with the 
Ukraine's international obligations with third countries. I would like to receive more 
detailed explanations on this matter . 
 
 Jointly managed process related to regulatory approximation :  
 
 Under the DCFTA, in several areas such as technical barriers to trade (TBT), sanitary and 
phytosanitary measures (SPS), customs and trade facilitation and public procurement, Ukraine has 
committed to approximate its legislation to the one of the EU with the aim to facilitate trade between the 
partners and in particular create better opportunities for Ukrainian producers and exporters in terms of 
access to the EU market. Transition periods h ave been envisaged in order to allow Ukraine to adopt the 
relevant domestic legislation, on the one hand and also to allow the stakeholders to adjust to the new 
regulation. The deadlines for legal approximation have been declared by Ukraine during the DCFT A 
negotiations and are specified in the relevant Annexes to the Association Agreement (TBT legislation for 
implementation by Ukraine is referred to in Annex III to Chapter 3). In some cases (e.g. SPS, public 
procurement) Ukraine has been committed to prepa re (after the start of application of the DCFTA) a 
strategy  or a roadmap  related to regulatory approximation which by the means of joint decision of 
association bodies is to become an integral part of the Association Agreement. In TBT area the EU and 
Ukraine monitor the process of regulatory approximation within the Association Committee in Trade 
Configuration . In order to strengthen the cooperation in this field (through the exchange of information 
(including on development of legal framework), experience and data in institutional capacity building, with 
a view to improving quality of all elements related to the safety of industrial products, both parties 
established in 2016 a Regulatory Dialogue  at expert level, meeting 1 -2 times a year and dealing with 
horizontal and sectoral TBT legislation.  
 
Regulatory approximation process in Ukraine (transparency and consultation on new/amended 
technical regulations and conformity assessment with WTO Members ):  
 
 It should be underlined that the DCFTA  Chapter 3 on Technical barriers to trade  applies to the 
preparation, adoption and application of technical regulations, standards and conformity assessment 
procedures as defined in the Agreement on Technical Barriers to Trade contained in Annex 1A 
('TBT Agreement') of the WTO Agreement that may affect trade in goods between the EU and Ukraine. 
Moreover, both parties affirm their existing rights and obligations under the TBT Agreement.  
 
 The central executive bodies in charge in Ukraine of carrying out technical regulation in the 
relevant sectors, monitor changes to the EU legislation, prepare or adopt changes to the domestic 
legislation and publish it accordingly.  
 
 WT/REG353/3  
 
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   In terms of transparency and public consultation,  the Law of Ukraine "On Technical Regulations 
and Conformi ty Assessment" adopted in 2015 specifies a framework of public consultation on draft 
technical regulations and conformity assessment procedures. It is done by publication of the relevant 
draft on the official website of the respective executive body.  
 
 In terms of international obligations,  if there is no relevant international standard or instruction or 
recommendation of an international organization for standardization concerning the conformity 
assessment procedure or the technical content of the technica l regulation, or conformity assessment 
procedure developed does not comply with the technical content of the relevant international standards 
or instructions or recommendations of international organizations for standardization, and if the technical 
regula tion or conformity assessment procedure may have a significant effect on the trade with the 
WTO Members, the relevant central executive body that has developed it shall:  
 
 immediately after the publication of the draft technical regulation or conformity 
assessment procedure provide WTO Members with a notification of the relevant draft 
technical regulation or conformity assessment procedure according to the form, to the 
extent and under the procedure determined by the rules of the WTO, on its official 
website  within five working days following the date of such publication;  
 provide the competent bodies of the WTO Members at their requests with a detailed 
description or copies of the text of the draft technical regulation or conformity 
assessment procedure and, if possible, specify the parts of the draft where it differs 
significantly from the relevant international standards or instructions or 
recommendations of international organizations for standardization concerning 
conformity assessment procedures;  
 provide the competent bodies of the WTO Members with the opportunity to submit 
written comments to the draft technical regulation or conformity assessment procedure, 
discuss such comments at their requests and take these written comments and the 
results of their d iscussion into account.  
 The notifications and other documents specified herein shall be submitted by the relevant central 
executive bodies via the central executive body implementing the state policy on economic development 
according to the requirements o f Article 22 of the Law on Technical Regulations and Conformity 
Assessment. Answers to the written comments of the competent bodies of the WTO Members shall be 
provided before the adoption date of the relevant technical regulation or conformity assessment 
procedure. The period for the submission of written comments to a draft technical regulation or 
conformity assessment procedure may not be shorter than 60 days from the date of:  
 
 the publication of the draft on the official website of the relevant central executive body 
– for the submission of comments by stakeholders;  
 the dissemination of the notification of the relevant draft by the WTO Secretariat among 
the WTO  Members – for the submission of comments by the competent bodies of the 
said members.  
 The per iod for written comments submission should be determined so as to ensure sufficient time 
to discuss the comments received with the stakeholders and the opportunity to make the necessary 
amendments to draft technical regulations or conformity assessment pro cedures if needed with a view to 
the procedure of development of implementing acts as established by the Law.  
 
 The relevant Ukrainian central executive bodies notify the WTO Members with the technical 
standards established as mandatory for implementation of technical regulations in Ukraine and having 
other features of a technical regulation determined by the above mentioned Law. This notification is done 
simultaneously with the notification of the draft technical regulations expected to establish the use o f such 
standards as mandatory.  
 
 Taking into account the above described process of ensuring transparency and consultation with 
WTO Members, Ukraine will continue observing its obligations under WTO with third countries.  
 
 In sectors where Ukraine has gi ven an undertaking that it will align its legislation with that of the 
EU, it will not make or continue conflicting obligations with third countries.   WT/REG353/3  
 
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  1.4.  Article 39.1 of the EU -Ukraine Agreement stipulates that "This Agreement shall not 
preclude the maintenan ce or establishment of customs unions, free trade areas or 
arrangements for frontier traffic except insofar as they conflict trade arrangements 
provided for in this Agreement". There are dozens of bilateral and multilateral 
agreements in the sphere of trad e and investment that link Ukraine with the CIS 
countries. Many of Ukraine's commitments are inconsistent with its obligations under 
the EU -Ukraine Agreement.  
 In case when there exist conflicting legally binding trade arrangements, namely: 
1) the EU -Ukrai ne Agreement 2) Arrangements within CIS, 3) bilateral arrangements, 
how do the parties ensure the fulfillment of their obligations of not worsening of trade 
conditions in accordance with Art icle XXIV, para graph  4 GATT and Art icle V, para graph  4 
GATS?  
 Under the DCFTA, the Parties committed to eliminate or reduce customs duties on originating 
goods according to their respective schedules in full compliance with Article XXIV of the GATT. Under the 
DCFTA, in several areas such as technical barriers to trade (T BT), sanitary and phytosanitary measures 
(SPS), customs and trade facilitation and public procurement, Ukraine has committed to approximate its 
legislation to the one of the EU with the aim to facilitate trade between the partners and in particular 
create better opportunities for Ukrainian producers and exporters in terms of access to the EU market. 
Transition periods have been envisaged in order to allow Ukraine to adopt the relevant domestic 
legislation, on the one hand and also to allow the stakeholders to adjust to the new regulation. While 
embarking on that process both Parties have affirmed in the DCFTA their existing rights and obligations 
under TBT Agreement and SPS Agreement of WTO.  
 
 Since the start of DCFTA implementation Ukraine has not received any complaints regarding any 
alleged contradictions of provisions on trade -related matters of the DCFTA with the relevant provisions of 
multilateral, bilateral and regional trade arrangements in particular as concerns CIS FTA with Armenia, 
Belarus, Kazakhs tan, Kyrgyzstan, Moldova, Tajikistan or Uzbekistan. As of 1 January 2016 Russia has 
suspended the application of the CIS FTA regime in relation to Ukraine. Furthermore, CIS FTA partners 
"should be guided by the rules and principles" of the TBT and SPS Agre ement of WTO.  
 
1.5.  In accordance with Article 273 of the EU -Ukraine Agreement "as regards transport 
of electricity and gas, and in particular third -party access to fixed infrastructure, the 
Parties shall adapt their legislation as referred to in Annex XXVII to  this Agreement and 
in the Energy community Treaty of 2005…" The Law of Ukraine «On the natural gas 
market» (May 8, 2015 No. 329 -VIII) was adopted in fulfillment of Ukraine's obligations 
under the Treaty on the Establishment of the Energy Community and the  Association 
Agreement between Ukraine and the EU, the European Atomic Energy Community, For 
the implementation of Energy Community legislation in the energy sector: Directive 
2009/73 / EC on the general rules of the domestic natural gas market and on the repeal 
of Directive 2003/55 / EC; Regulation (EC) 715/2009 on the conditions of access to 
natural gas transportation networks and which is repealed Regulation (EC) 1775/2005; 
Directive 2004/67 / EC on the implementation of measures to ensure the security o f 
natural gas supply.  According to the law, an operator of Ukraine's gas transportation 
system (GTS), which is state -owned and not subject to privatize, can be exclusively a 
business entity whose owner of corporate rights is exclusively a state or business  entity, 
100% of whose corporate rights belong to the state, or state or economic entity, 100% 
of whose corporate rights belong to the state, which owns at least 51% of the corporate 
rights of such an operator, together with a partner the GTS. A partner of  the GTS of 
Ukraine must have at least 5 years' experience in managing the GTS in the EU or US 
market or belong (100%) to a legal entity that meets these requirements.  
 What is reasonable justification for adoption and implementation of the above 
mentioned  requirements, limiting access of third Parties (others then EU and USA) 
operators to Ukraine gas transportation sector? Taking into account that those 
requirements appeared after signing the EU -Ukraine Agreement and as implementation 
of the respective pro visions of the last one, how does this correspond to Article  XXIV, 
para.  4 GATT and Art icle V, para graph  4 GATS.  WT/REG353/3  
 
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   One should recall that  Ukraine joined the Energy Community Treaty on 1 February 2011 and 
on this basis committed to approximate its law in the  energy sector to the EU legal framework, 
even before application of the Association Agreement/DCFTA.  
 
 The Gas Market Law adopted by Ukraine in 2015 does not require a specific type of legal entity; 
rather, it sets out the characteristics of the legal ent ity through which services in respect of the GTS 
owned by the state of Ukraine may be supplied. Specifically, the Law indicates that the GTS operator may 
only be a business entity owned by the state of Ukraine (or by a business entity fully owned by Ukrain ian 
state), in full or by at least 51%, alongside a qualifying GTS Partner. Under Article 21(1) of the Gas 
Market Law, the operator of the GTS owned by the State of Ukraine may be a business entity owned by 
the State of Ukraine (or by a business entity ful ly owned by Ukrainian state), in full or by at least 51%, 
alongside a qualifying GTS Partner. For the purposes of selecting the GTS Partner, the protection of the 
essential security interests of Ukraine is one of the main factors taken into consideration. This is fully in 
line with the WTO Agreements and national legislation.  
 
1.6.  We would like to mention that, according to Ukrstat, since the beginning of the 
implementation by the Ukrainian side of the Association Agreement with the EU, 
Ukraine 's volume of trad e with the EU has declined.  
 We would be grateful if the parties could comment on the reasons behind that.  
 According to the both Ukrstat and Eurostat data, from the start of the provisional implementation 
of the DCFTA an increase of bilateral trade betw een Ukraine and the EU is observed. In particular: 
according to Ukrstat, in 2016 compared to 2015 the trade in goods between Ukraine and the EU 
increased by 8.1% (by US$2,290.4 million ). Export of goods increased by 3.7% (by US$482.5 m illion) 
and import by  11.8% (by US$1,808.0 million ). In January -March 2017 compared to the same period in 
2016 - when the DCFTA started to be applied - trade increased by 21.6% (by US$1 527.0 m illion), export 
from Ukraine to the EU – by 24.5% (by US$782.3 m illion), imports fr om the EU to Ukraine – by 19.2% 
(by US$744.8  million). This shows not only that bilateral trade has been increasing but that it has also 
become more balanced.  
 
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