Proposal for a Council Decision establishing the Community position within the General Council of the World Trade Organization on the accession of the Republic of Ukraine to the World Trade Organization
Date: 2008-01-23
Institutions: European Commission
Subjects: Ukraine, World Trade Organisation, enlargement of an international organisation, the EU's international role

EN 

EN 

   EN 

 
 
COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 23.1.2008 
COM(2008) 24 final 

2008/0012 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position within the General Council of the World Trade 
Organization on the accession of the Republic of Ukraine to the World Trade 
Organization 

(presented by the Commission) 

EN 

   EN 

 
 
 
  
EXPLANATORY MEMORANDUM 

Overview of the Terms of Ukraine’s Accession to the WTO 

I. INTRODUCTION 

Members of the World Trade Organisation (WTO) and the Republic of Ukraine have reached 
the concluding stage of agreement on the terms for Ukraine’s accession to the organisation. 
This  comes  after  14  years  of  negotiations,  which  began  when  Ukraine  submitted  its 
application to join the WTO in 1993. There must now be a Council Decision approving the 
terms of Ukraine' accession, before the EU can formally support Ukraine's entry. 

A summary of the terms of the accession is set out below. 

II. SUMMARY OF TERMS OF UKRAINE’S WTO ACCESSION BY SECTOR 

Industrial Goods 

The  average  of  Ukraine's  initial  bound  rates  (IBR)  is  at  4.91%,  which  will  be  reduced  to 
4.81% (FBR). Implementation periods between 1 and 5 years have been introduced only for 
226  lines.  This  leads  to  an  average  staging  of  0.05  years.  Only  71  tariff  lines  will  be  at  or 
above 15% duty rates. 5 lines will remain at peak level of 25%. All tariffs will be bound. 

As  regards  sectoral  initiatives,  tariffs  on  ITA,  paper,  medical  equipment,  furniture  and  toys 
will be eliminated. In the other sector initiatives tariffs go below 1 % (agricultural 0.71% and 
construction  equipment  0.35,  steel  (MSA)  0.22  and  pharmaceuticals  0.05%).  Chemicals' 
harmonisation will be at 5.32%. 

On  machinery  and  appliances,  the  most  interesting  sectors  for  the  EU,  the  tariffs  will  be  at 
5.33%. The tariffs on vehicles and parts will be at 7.97%.  

Agricultural goods 

On agricultural goods, the average of the initial bound rates (IBR) is 11.05%, which will be 
reduced to 10.61%. In agriculture only 20 tariff lines have an implementation period (2 years). 
The highest rates are sunflower seed oil with 30% and sugar with 50%. 
Services  

Ukraine  undertakes  commitments  allowing  for  competition  between  domestic  and  foreign 
services suppliers in practically all sectors and sub-sectors, which will bring benefits both to 
the Ukrainian economy and to the EU, who is the world’s leading exporter in this field.  

Foreign services suppliers will face no quantitative or discriminatory restrictions at all in key 
services sectors such as: 

•  professional services, 

•  the vast majority of business services  

•  postal & courier services in the areas not reserved to the national monopoly 

•  telecommunications services 

•  construction services 

•  distribution services 

•  environmental services 

EN 

2 

   EN 

 
•  tourism services 

•  the vast majority of financial services, and 

•  the vast majority of transport services, including pipeline transport 

The few sectors for which Ukraine does not undertake commitments include investigation and 
security  services,  audiovisual  services,  space  transport  and  pushing  and  towing  services  for 
maritime  and  rail  transport.  For  passenger  and  freight  rail  transport  the  commitments  are 
limited to the consumption abroad of those services. For insurance services, Ukraine retains 
limitations  on  cross-border  supply  similar  to  those  of  the  rest  of  the  WTO  membership  and 
will allow direct branching only five years after its accession to the WTO and retains some 
limitations.  

Protocol commitments 

In the final, multilateral stage of the accession process, WTO Members collectively sought to 
ensure  the  basic  compatibility  of  Ukraine's  trade  laws  and  institutions  with  WTO  rules  and 
agreements,  setting  these  out  in  the  Protocol  of  accession  and  Working  Party  Report.  The 
following issues are of particular interest to the EU: 

Pricing policies 

Ukraine has taken on a commitment not to apply mandatory minimum price requirements to 
any imported product. Upon accession, all rail transportation fees would be applied on a non-
discriminatory basis to goods transported between domestic locations, imported, exported, or 
in transit. 

Alcohol licensing fees 

Ukraine has changed its legislation to bring the licensing fees for importation and exportation 
of  alcohol  beverages  and  tobacco  to  the  level  of  UAH  780  (104  EUR),  which  is 
commensurate  to  the  cost  of  services  rendered  and  thereby  compatible  with  Article  VIII 
GATT  1994.  Ukraine  has  taken  on  a  commitment  to  maintain  this  level  from  the  date  of 
accession. 

Application of internal taxes to imports 

Ukraine  had  changed  its  legislation  to  eliminate  the  discriminatory  excise  tax  treatment  of 
imported  alcohol  beverages.  VAT  exemptions  granted  to  automobile,  shipbuilding  and 
aircraft  constructions  industries  had  also  been  eliminated.  Ukraine  had  also  taken  on  a 
commitment to maintain this situation and to apply its internal taxes in compliance with the 
WTO rules upon accession.  

Import licensing system 

Ukraine  had  changed  its  legislation  to  bring  its  import  licensing  procedures  in  compliance 
with  the  WTO  rules,  including  the  Agreement  on  Import  Licensing  Procedures.  Most 
provisions of the WTO instruments in this area have already been transposed into the national 
law, and the few remaining provisions will be adopted by accession. 

Customs valuation 

Ukraine  has  taken  on  a  commitment  to  apply  the  WTO  provisions  concerning  customs 
valuation upon accession. Ukraine would not use any form of reference or minimum prices or 
fixed  valuation  schedules  for  the  valuation  of  imports,  and  all  methods  of  valuation  used 
would  be  in  conformity  with  those  provided  for  in  the  WTO Agreement  on  the 
Implementation of Article VII GATT 1994. 

EN 

3 

   EN 

 
Export duties 

Ukraine  has  taken  on  a  commitment  to  gradually  reduce  its  export  duties  imposed  on  scrap 
metal, hides and skins, live cattle and oil seeds significantly within the periods of 5 to 8 years. 
The reduction schedules and the reduced levels of duties will be bound upon accession. 

Subsidies  

Ukraine had changed its legislation to eliminate all WTO-incompatible subsidies provided to 
automobile,  shipbuilding  and  aircraft  constructions  industries.  Ukraine  has  also  taken  on  a 
commitment not to introduce any such subsidies in the future. Ukraine will provide a subsidy 
notification to the WTO by the date of accession. 

Transit 

Ukraine  will  apply  all  its  laws,  regulations  and  other  measures  governing  transit  of  goods 
(including energy), and charges for transportation of goods in transit in conformity with the 
provisions  of  Article  V  of  the  GATT  1994  and  other  relevant  provisions  of  the  WTO 
Agreement upon accession. 

Intellectual Property Rights 

As  regards  geographical  indications,  Ukraine  provides  co-existence  of  geographical 
indications with prior trademarks under certain circumstances in accordance with Article 17 
of the TRIPS Agreement. Ukraine also provides the same protection of rights to geographical 
indications to nationals of WTO members as was provided to Ukrainian nationals. Regarding 
data protection, Ukraine provides five years protection for pharmaceuticals and ten years for 
agrochemicals.  On  enforcement  of  intellectual  property  rights,  Ukraine  has  taken  on 
comprehensive commitments which reflect the provisions of the relevant EC Directive. 

III. RECOMMENDATION 

In submitting the terms of Accession of the Republic of Ukraine to the WTO for approval by 
the Council, the Commission commends these terms as representing a balanced but ambitious 
package of market opening commitments, which will bring substantial benefits to Ukraine and 
her WTO trading partners alike. 

EN 

4 

   EN 

 
2008/0012 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position within the General Council of the World Trade 
Organization on the accession of the Republic of Ukraine to the World Trade 
Organization 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Articles 
133(1) and 133(5) in conjunction with the second subparagraph of Article 300(2) thereof 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

On  20  November  1993  the  Government  of  the  Republic  of  Ukraine  applied  for 
accession  to  the  Agreement  establishing  the  World  Trade  Organization  (WTO), 
pursuant to Article XII of that Agreement. 

A  Working  Party  on  Ukraine’s  accession  was  established  on  17  December  1993  in 
order to reach agreement on terms of accession acceptable to the Republic of Ukraine 
and all WTO Members. 

The Commission, on behalf of the Community, negotiated a comprehensive series of 
market  opening  commitments  on  the  part  of  the  Republic  of  Ukraine  which  are  of 
particular importance to the Community, as set out in a memorandum agreed between 
the negotiators of the Republic of Ukraine and the Commission on 17 March 2003. 

These commitments are now embodied in the Protocol of Accession of the Republic of 
Ukraine to the WTO. 

Accession to the WTO is expected to make a positive and lasting contribution to the 
process of economic reform and sustainable development in the Republic of Ukraine. 

The Protocol of Accession should therefore be approved. 

Article  XII  of  the  Agreement  establishing  the  WTO  provides  that  the  terms  of 
accession are to be agreed between the acceding Member and the WTO, and that the 
Ministerial Conference of the WTO approves the terms of accession on the WTO side. 
Article  IV.2  of  the  Agreement  establishing  the  WTO  provides  that  in  the  intervals 
between  meetings  of  the  Ministerial  Conference,  its  functions  shall  be  conducted  by 
the General Council. 

(8) 

Accordingly,  it  is  necessary  to  establish  the  position  to  be  taken  by  the  Community 
within the General Council, 

EN 

5 

   EN 

 
HAS DECIDED AS FOLLOWS: 

Sole Article 

1. 

2. 

The position to be taken by the Community within the General Council of the WTO 
on the accession of the Republic of Ukraine to the WTO, is to approve the accession. 

This position shall be expressed by the Commission on behalf of the Community. 

Done at Brussels, […] 

For the Council 
The President 
[…] 

EN 

6 

   EN