RESTRICTED  
  
JOB/ACC/40/Add.1  
 
9 September 2014  
(14-5118) Page: 1/8  
Working Party on the Accession of Kazakhstan   
 
 ACCESSION OF KAZAKHSTAN 
PROPOSAL ON ORDINA RY CUSTOMS DUTIES 
Addendum  
 
  
 
   
This document consolidates the questions, comments and proposals on the Chairman's 
"Proposal on Ordinary Customs Duties", contained in document JOB/ACC/40, from 5 Members, namely: Argentina, Brazil, European Union, Japan and Korea.  This document also includes replies 
from the Delegation of Kazakhstan to questions raised by Members.  
 Although this is a WTO-restricted document, it is further restricted to the 29 Members
1 of 
the Working Party with negotiated, signed and de posited bilateral market access agreements on 
goods with the Acceding Government of Kazakhst an, Kazakhstan and, the Russian Federation.   
 It is being circulated by the WTO Secretaria t, on the authority of the Chairman of the 
Working Party on the Accession of Kazakhstan, pursuant to the understanding from the Chairman's 
consultations with the 29 Signatory Members of th e Working Party, the Acceding Government of 
Kazakhstan and the Russian Federation on 22 July 2014.   
 
 
____________ 
 
 
                                               
1 Argentina; Australia; Brazil; Canada; China; Cuba; Dominican Republic; Ecuador; Egypt; El Salvador; 
European Union; Georgia; Guatemala;  Honduras; India; Israel; Japan; Ko rea, Republic of; Kyrgyz Republic; 
Malaysia; Mexico; Norway; Oman; Pakistan; Saudi Arabia, Kingdom of; Switzerland; Chinese Taipei; Turkey; and United States. This document has been prepared under the Secretariat's own responsibility 
and is without prejudice to the positions of Members or to their rights and 
obligations under the WTO. JOB/ACC/40/Add.1 
 
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Question 1 [Argentina] 
With the evaluation of the proposal in JO B/ACC/40, could Kazakhstan circulate a new 
list of concessions that includes disposition s of the proposal, replacing the draft list 
WT/ACC/SPEC/KAZ/10/Rev.3 dated 26 September 2012? 
Answer: 
WT/ACC/SPEC/KAZ/10/Rev.4 has been circulated by the WTO Secretariat on 26 August 2014 for 
verification by Signatory Members. 
Question 2 [Argentina] 
In cases where the Customs Union's new tariff is higher than Kazakhstan's consolidated 
tariff, could Kazakhstan explain under which cr iteria it would  ask for exceptions to the 
Customs Union's tariff (applying WTO's conso lidated tariff) and under which criteria it 
would ask for a renegotiation of the consolidated tariff in order to apply the new Customs Union's tariff?  In the case of exce ptions to the Customs Union's tariff, could 
Kazakhstan explain how these exceptions will  work and whether they will be provisional 
or permanent?  Also, what will be the le vel of the mentioned exception: systemic, 
sectorial, etc.?  
Answer: 
Kazakhstan upon accession will implement exceptio ns from the CU CET on the tariff lines referred 
in the item (a) of paragraph 289 of the Chairman's Proposal on Ordinary Customs Duties. 
The CU members will ensure the implementation of the exceptions to the CU CET through the 
relevant CU instruments. 
The CU members will apply and implement all necessary measures to prevent circumvention of the 
CU CET through the customs territory of Kazakhstan. 
Question 3 [Argentina] How many tariff lines are estimated to be involved in future negotiations? 
Answer: 
The scope of tariff lines under the item (a) of  paragraph 289 would cover 3171 tariff lines which 
will be subject to adjustment negotiations. 
 
Question 4 [Argentina] 
What sort of treatment would have Russia' s and Kazakhstan's consolidated tariff 
quotas?  Would they be a single tariff quota administered by the Customs Union or each 
country would administer its quota individual ly?  Could Kazakhstan confirm whether the 
dispositions of JOB/ACC/40 could be applied to tariff quotas? 
Answer: 
TRQs are allocated on an annual basis among the Customs Union's member States, based on 
proposals from the member States.   
 
Administration of tariff quotas remains in the nati onal competencies of the CU members as it is 
stated in paragraph 328 of the chapter on Tariff Rate Quotas of the draft WPR on Kazakhstan's 
Accession (WT/ACC/SPEC/KAZ/9/Rev.11 of  9 July 2014):  JOB/ACC/40/Add.1 
 
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  " T h e  E u r a s i a n  E c o n o m i c  C o m m i s s i o n  h a d  a l s o  d e t e r m i n e d  t h a t  t h e  T R Q s  i n  t h e  
EAEU member States were to be admi nistered by the governments of the 
EAEU member States  in accordance with their respective national legislation". 
 
Goods under TRQ regime might also be subject to adjustment negotiation. 
 
Question 5 [EU] 
It is proposed that paragraph 289 ter is modified as follows: 
 
"[289ter] The representative of Kazakhstan  confirmed that Kazakhstan would fully 
implement upon accession the commitments  contained in the Accession Schedule, 
introducing or maintaining [any necessa ry] exemptions from the CU CCT with 
respect to tariff lines for which the Customs Union tariff rates are inconsistent with 
the Accession Schedule until such time as the adjusted tariff rates negotiated and 
agreed to pursuant to [paragraphs quater to septies] have been implemented in the modified schedules of all CU member s that are WTO Members.  She further 
confirmed that goods referred to in subparagraph (a) of paragraph 289 entering 
the CU territory for import in Kazakhstan would benefit from either the rules 
applicable to transport and/or transit with in the CU territory of goods originating 
in the CU or the rules on transit set out in Article V of the GATT 1994 and the WTO 
Trade Facilitation Agreement, whichever is more favourable. The Working Party 
took note of these commitments." 
 
Answer: 
The suggested modification of paragraph 289 ter is under consideration by Kazakhstan. 
Question 6 [Argentina] 
Are the negotiations referred to in paragraph 289 quater  a mechanism different from 
that prescribed in GATT 1994 Article XXVIII? 
Answer: 
Although the legal basis of negotiations under Article XXIV and respectively Article XXVIII is 
different from the legal basis of adjustment negotiations we believe that the nature of these 
negotiations is the same, and see no reasons why respective mechanisms provided for in Article 
XXVIII can not be used in adjustment negotiations. 
 
Question 7 [EU] 
It is suggested that paragraph 289 quater  is modified as follows: 
 
"[289quater] The representative of Kazakhstan further informed confirmed that no 
earlier than [three] [four] years from the date of full implementation of the final 
bound tariff rates contained in the Accessi on Schedule, Kazakhstan would seek to 
align the Accession Schedule with the CU CCT and, therefore, commence 
negotiations with those WTO Members that  had concluded bilateral goods market 
access deals with Kazakhstan and would be affected by such alignment[, i.e. those 
holding INRs or those having a principal [o r substantial] supplyi ng interest by the 
date on which the negotiations start] (h ereafter "affected Members"). For that 
purpose Kazakhstan would notify its inte ntion to commence the negotiations and 
all data relevant for the conduct of those negotiations six months before the start 
of the negotiations. The Working Party took note of these commitments." 
 JOB/ACC/40/Add.1 
 
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  Answer: 
The suggested modification of paragraph 289quater is under consideration by Kazakhstan. 
Question 8 [Brazil] The main concern is the possibility of having  more flexible parame ters for negotiation 
with Kazakhstan, and at the same time gran ting Kazakhstan enough space to limit the 
number of participants and lines.  In lig ht of this, the following is proposed: 
 
"[289quater] The representative of Kazakh stan further informed that no earlier 
than [three] [four] years from the date of full implementation of the final bound tariff rates contained in the Accession Sc hedule, Kazakhstan would seek to align 
the Accession Schedule with the CU CET and, therefore, commence negotiations 
with those WTO Members that had conclu ded bilateral goods market access deals 
with Kazakhstan and would be affected by such alignment. For the purpose of this 
negotiation, affected Members are those wh o fall into any the following criteria:   
 
a) Hold Initial Negotiating Rights (INRs);   b) Have a principal supplying interest (PSI);  
c) Have substantial interest (SI); and   
d) In the period of 2008-2013, had an average bilateral trade flow with Kazakhstan of at least US $ 50,000.00 (fifty thousand dollars) per tariff line, per 
year.  
 
For that purpose Kazakhstan would notify its intention to commence the negotiations and all data relevant for the conduct of those negotiations six months 
before the start of the negotiations. The Working Party took note of these 
commitments." 
 
Brazil would not be in a position to accept a proposal that does not grant it with enough 
certainty, and hence the use of the US$ 50, 000.00 annual average parameter.  The use 
of PSI/SI would be subject to the future, le aving the process open, and unfavourable.   
 
Answer: 
The suggested modification of paragraph 289 quater  is under consideration by Kazakhstan. 
Question 9 [Brazil] 
In addition to the above, without prejudic e to further requests that may follow, some 
other concerns, already expressed in meetings, are reiterated, hereunder:  
 
- The proposal has to be more specific when it comes to the forms of compensation. 
Just saying that it could be either by formula or requests is way too broad.  
 - Kazakhstan should maintain any nece ssary CU-CET exemptions until a final 
solution is found.  
 - Kazakhstan has to obtain from the CU the possibility of havi ng CU-CET permanent 
exemptions after the negotiating pr ocess, if that is so required. 
 - What will happen in case the Genera l Council does not reach a conclusion? 
It cannot be left to chance.  
 - It has to be crystal clear that, in the unlikely situation where a solution is not 
found, the Kazakh schedule with all deviatio ns would remain in force, regardless of 
any timeframe agreed for negotiations, that must be considered as indicative ones. 
 - All CU Members (and in particular, Russi a )  h a v e  t o  a c c e p t  i t s  f a i r  s h a r e  o f  
responsibilities in this negotiation. 
 JOB/ACC/40/Add.1 
 
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  Answer: 
Please explain which particular part of the existing draft commitments causes concerns for Brazil. 
Question 10 [Argentina] 
Could Kazakhstan identify the tariff lines referred to in paragraph 289 quinques  that 
would integrate a small subset, to be included  in an Annex, and would not be subject to 
tariff increases? 
Answer: 
The referred element has been removed at the request of the WTO member (original proponent of 
this element) at the Plurilateral Meeting on Chai rman's Proposal on Ordinary Customs Duties of 
22 July 2014. 
Question 11 [EU] 
It is suggested that paragraph 289 quinques  is modified, as follows: 
 
"[289 quinques] The negotiations referred to in [paragraph 289 quarter] would 
include the tariff rate increases on goods subject to subparagraph (a) of paragraph 
289 [except a small subset of tariff lines agreed to by Kazakhstan and affected 
Members listed in Annex …, which are al so excluded from any further negotiation 
thereafter]. The negotiations referred to  in [paragraph 289 quarter] would not 
include tariff rate increases on goods subj ect to subparagraph (b) of par 289[, as 
well as on a small subset of tariff lines agreed to by Kazakhstan and affected 
Members listed in Annex …, which are al so excluded from any further negotiation 
thereafter]. For goods subject to negotiat ion, the representative of Kazakhstan 
confirmed that no tariff lines subject to in crease of the bound import tariff rates of 
Kazakhstan would be a priori excluded fr om the scope of these negotiations. The 
Working Party took note of these commitments." 
 
Answer: 
The suggested modification of paragraph 289 quinques  is under consideration by Kazakhstan. 
Question 12 [Korea] 
At the outset, sincere appreciation is expressed for the efforts of Ambassador 
Vesa Himanen, Chairman of the Working Part y, in putting forward his proposal on the 
tariff adjustment in relation to Kazakhst an's accession to the WTO (JOB/ACC/40) on 
4 July 2014.     
While reserving the right to revert to this i ssue, if needed, initia l comments are offered 
on the Proposal by the Chairman of the Working Party, as hereunder:  
- While understanding the need to facilitate discussion with regards to the complex 
issue of tariff adjustment of Kazakhstan , this Member is concerned about the 
process of discussion over the last two mo nths. It is believed that the discussion 
process should have been more  transparent and inclusive;  
- Regarding the substance of the Chair's Prop osal, there is positive consideration of 
the elements in paragraph 289 and paragraph 289 quater .  However, this Member 
is seriously concerned about the unclear status of the element prescribed in 
paragraph 289 quinquies  regarding "a small subset of  tariff lines agreed to by 
Kazakhstan and affected Members." Cons idering the bilateral consultation on 
31 July where Kazakhstan informed Signat ory Members that this element is not 
part of the Chair's proposal any more du e to its withdrawal by another Member 
(original proponent of this element), th is Member would like to inquire whether 
this element is indeed dropped or not;  JOB/ACC/40/Add.1 
 
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  - In case the element "a small subset of tariff lines agreed to by Kazakhstan and 
affected Members" should remain in the final version of Chair's proposal, this 
Member must be considered as "an affect ed Member" and must be consulted with 
by Kazakhstan because this Member has a substantial supplying interest in certain 
products, in particular HS870323 and HS852990. These are currently this 
Member's major export products to Ka zakhstan. What is more, their export 
volumes increased more than three times in 2012 as compared to those of 2011. 
For the case of HS 870323, its export volume again doubled in 2013 as compared 
to that of 2012.  Of course, this is not an exhaustive list of its pr oducts of interest;  
- If this element should remain in the fi nal version of the Chair's proposal without 
this Member being included in affected Members in the context of this element, 
this Member will be in an extremely diffi cult position to join the consensus. 
Korea is committed to engaging in the acce ssion process of Kazakhstan with close 
cooperation of Kazakhstan and other WTO Members.   
Answer: 
The referred element has been removed at the requ est of the WTO Member (original proponent of 
this element) at the Plurilateral Meeting on Chai rman's Proposal on Ordinary Customs Duties of 
22 July 2014. 
Question 13 [Japan] 
First of all, to avoid misunderstandings,  the views on the current status of the 
discussions are expressed as follows:  
At the time Kazakhstan proposed the tariff adjustment exercise through formula in 
autumn of 2012, the "Revised Draft Con solidated Schedule of Concessions and 
Commitments in HS 2007", including si mplified tariff lines, was submitted 
(WT/ACC/SPEC/KAZ/10/Rev.3) and it is still under discussion. In this draft, this 
Member found discrepancies including some ta riff lines which seem to exceed the level 
of duty which Japan and Kazakhstan had alread y agreed. We will be pleased to re-start 
the process of reviewing the draft as soon as possible. 
Regarding the proposal by the Chairman (JOB/ACC/40), comments2 from this Member 
are as follows: 
- Paragraph 289quarter : Japan is concerned about the scope of the "affected 
Members". The predictability of eligibilit y to the "affected Members" seems too 
little because the relevant imports data will only be availabl e [3-4] years after 
the full implementation of the final bound tariff; 
- Current criteria of "affected Members"  who can participate in future tariff 
negotiation are disadvantageous to a country which intends to expand 
investment in Kazakhstan. In order to in vite greater investment to Kazakhstan, 
the reference period of the import data to Kazakhstan needs to be reconsidered 
so that such an interested country could take part in the negotiation in a more 
flexible manner; 
- Paragraph 289 sexies :  The compensatory negotiatio ns should be conducted line 
by line. Although it is not clear what the "formula approaches" means, Japan has 
significant difficulty in going along wi th the idea since the compensatory 
negotiations could not automatically le ad to a conclusion through a formula. 
- Paragraph 289 novies :  Japan would like to confirm that Kazakhstan is legally 
bound not to have recourse to Articles  XXIV:6 or XXVIII of the GATT, namely 
referring to the use of "would not" in the second sentence of this paragraph. 
                                               
2 These comments are without prejudice to this Member's final position on the negotiation. JOB/ACC/40/Add.1 
 
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  Answer: 
Based on the discussions at the Plurilateral Meeting on the Chairman's Proposal on Ordinary 
Customs Duties on 22 July 2014 as well as on th e further consultations with Signatory Members, 
Kazakhstan agreed to modify paragraph 289quater by removing the brackets and including 
Members having substantial supplying interest  into the scope of "affected members": 
 
[289quater ] Kazakhstan would seek to align the Accession Schedule with the CU CET and, 
therefore, commence negotiations with those WTO Members that had concluded bilateral 
goods market access Protocols with Kazakhstan and would be affected by such alignment [, i.e. those holding INRs or those having a principal or substantial supplying interest by the date on which the negotiations start] (hereafter "affected Members").  
 
This modification will significantly increase the scope of Signatory Members under the definition of 
"affected Members", and interested countries will be able to take part in the tariff adjustment 
negotiations in a more flexible manner. 
 Three years would be taken as sufficient for the reference period for the statistics on importation 
of the products based on the existing WTO practice.  
It should be noted that upon accession to the WTO and during the three years reference period 
Kazakhstan will be applying import duties on 3171  products under the item (a) of the Chairman's 
Proposal, that will be lower than the Common Exte rnal Tariff, applied by Kazakhstan currently.  
Kazakhstan believes that lower import duties would be advantageous to the countries which intend 
to expand trade and investment with Kazakhstan. 
Furthermore, upon conclusion of the tariff adjustment negotiations WTO Members will get more 
advantageous access to the market of 175 million people due to the adjusted Common External 
Tariff.  
The current language of paragraph [289 sexies ] of the Chairman's Proposal on Ordinary Customs 
Duties does not exclude both approaches to the negotiations: formula and requests on specific priority tariff lines. Kazakhstan will continue consultations with Members with regard to the tariff adjustment negotiations mechanism.   
 
Kazakhstan will consider the suggestion of the Member on paragraph 289 novies . 
Question 14 [Argentina] 
In relation to the method for calculating th e compensatory adjustment's value for every 
affected Member (paragraph 289 sexies ), what does it mean "duties payable"? Does 
"duties payable" refer to the Customs Union' s, Russian Federation's or Kazakhstan's 
tariffs? 
Answer: 
The duties payable are mentioned in the context of  the calculation of the value of compensatory 
adjustment, and refer to the calculation based on the volume of trade of Kazakhstan and 
Kazakhstan's duty rates. 
Question 15 [Argentina] Can Kazakhstan confirm whether the Russian Federation's participation in future tariff 
adjustment negotiations mentioned in paragraph 289 septies  implies that compensation 
for affected Members entails an  effect on Russian import market?  For example, could 
compensation result in an enlargemen t of the tariff quota granted by the 
Russian Federation in its schedule  of concessions and commitments? JOB/ACC/40/Add.1 
 
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  Answer: 
There is an understanding between Kazakhstan and Russia that Russia would participate in future 
adjustment negotiations. 
The form of compensation would be subj ect to tariff adjustment negotiations. 
Question 16 [Argentina] In the case an affected Member does not obtain a satisfactory compensation, what 
would be the procedure to follow?  Is it possible to withdraw concessions according to GATT 1994 Article XXIII:3? 
This Member clarifies that it would pose furt her questions because it is still studying the 
document due to the short notice of its receipt and time for its review. 
Answer:  
Paragraph [289 novies ] of the Chairman's Proposal on Ordinary Customs Duties contains the 
following commitment of Kazakhstan: 
"…Kazakhstan confirmed that it would not have recourse to Articles XXIV:6 or XXVIII of 
the GATT 1994 and will continue to apply the commitments contained in the Accession 
Schedule from the date of its accession until such time as adjusted tariff rates are 
negotiated and agreed by consensus with the affected  Members…" 
Question 17 [EU] 
It is proposed that paragraph 289 octies  is modified, as follows:  
 
"[289octies] The representative of Kazakhst an confirmed that, from the date of its 
accession to the WTO, Kazakhstan will ensure the conformity of its laws, 
regulations and administrative procedures , whether adopted by the authority of 
Kazakhstan or the competent body of the EEU and applied within the territory of 
Kazakhstan, with the obligations of Kazakhstan as provided in the WTO 
Agreements, including the accession protoc ols. [Furthermore, the representatives 
of Kazakhstan and of the Russian Federati on confirmed that the legal obligations 
relating to the implementation of WT O commitments under the EAEU regimes 
described in paragraphs [245 and 246] of this Report and in paragraphs 185 and 
186 of the Working party Report on the Accession of the Russian federation to the 
WTO, the WTO commitments undertaken by a CU member are and will continue to 
be part of the CU legal order and automa tically applicable to other CU members.] 
The Working Party took note of these commitments.]" 
 Answer: 
The suggested modification of paragraph 289 octies  is under consideration by Kazakhstan. 
 
 
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