Proposal for a COUNCIL DECISION on the position to be adopted on behalf of the European Union within the relevant instances of the World Trade Organization on the accession of the Russian Federation to the World Trade Organization
Date: 2011-11-10
Institutions: European Commission
Subjects: Russia, World Trade Organisation, enlargement of an international organisation, international negotiations, liberalisation of trade, tariff negotiations

EUROPEAN COMMISSION 

Brussels, 10.11.2011 
COM(2011) 720 final 

2011/0320 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be adopted on behalf of the European Union within the relevant 
instances of the World Trade Organization on the accession of the Russian Federation to 
the World Trade Organization 

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

Overview of the Terms of Accession to the WTO of the Russian Federation 

I. INTRODUCTION 

Members of the World Trade Organization (WTO) and the Russian Federation have reached 
the  concluding  stage  of  the  negotiation  of  an  agreement  on  the  terms  on  which  the  Russian 
Federation may accede to the organization. This comes after 18 years of negotiations, which 
began when the Russian Federation submitted its application to join the WTO in 1993. There 
must now be a Council Decision approving the terms of accession of the Russian Federation, 
before the EU can formally support the accession of the Russian Federation to the WTO. 

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

II. SUMMARY OF TERMS OF ACCESSION OF THE RUSSIAN FEDERATION TO 
THE WTO BY SECTOR 

Import Tariffs 

The overall average final bound rate (FBR) of the Russian Federation is 7.6%. 

Concerning  industrial  goods,  the  average  FBR  is  7.9%,  but  in  different  sectors  it  fluctuates 
from no duty for the Information Technology Agreement (ITA) products to the low averages 
in  pharmaceuticals  and  medical  equipment  (4.3%),  agricultural  equipment  (4.6%),  footwear 
(5%), chemicals and construction equipment (5.2%) to the highest averages for glass (11.1%) 
and ceramics (12.2%). 

The trade statistics for 2010 show that chemicals, machinery and motor vehicles are three key 
industrial sectors that constituted more than 60% of the total EU exports to Russia. In these 
sectors  the  average  FBR  varies  from  5.3%  for  chemicals  to  6.5%  for  machinery  and 
appliances to 9.2% for vehicles and parts thereof. 

Concerning agricultural goods, the estimated average FBR is 11.5% with the highest average 
rates for rice (20%), dairy products (14.6%) and vegetable oils (11.4%). 

Out  of  11,327  tariff  lines  in  the  goods'  schedule  of  the  Russian  Federation,  6,992  will  not 
reach  its  FBR  at  the  moment  of  accession,  and  will  consequently  have  an  implementation 
period.  As  of  the  date  of  accession  of  the  Russian  Federation  to  the  WTO,  the  longest 
implementation  periods  are  foreseen  for  motor  vehicles  (7  years)  and  certain  chemicals  and 
furniture products (6 years). 

These  average  bound  levels  for  tariffs  are  very  reasonable,  in  particular  compared  to  the 
current  average  bound  or  even  applied  rates  of  the  other  BRIC  countries.  For  example, 
China's  FBR  for  industrial  goods  is  10%  (average  applied  rate  -  8.7%),  Brazils'  –  31.4% 
(average  applied  rate  –  14.1%)  and  India's  –  48.5%  (average  applied  rate  –  10.1%).  In 
agriculture, China is bound to an estimated average rate of 15.6% and India – 31.8%. 

Export Tariffs 

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The goods' schedule of the Russian Federation includes binding export tariff concessions and 
commitments with regard to a broad range of products, mainly raw materials, including fish 
and  sea  fruits,  seeds,  mineral  and  chemical  products,  oil  and  gas  products,  metal  ores  and 
scrap, plastic, hides and skins, wood, pulp, paper, and precious and semi-precious stones. 

Services  

The  schedule  of  specific  commitments  in  services  of  the  Russian  Federation  is  very 
satisfactory  and  grants  European  service  suppliers  significant  market  opportunities.  Russia 
will undertake market access and national treatment commitments in a broad range of service 
sectors, including professional, computer and other business services, construction, postal and 
courier  services, 
transport,  distribution, 
environmental, financial (insurance, banking and securities services), and tourism and travel-
related services. Russia also undertook a commitment concerning intra-corporate transfers of 
natural persons providing services and concerning business visitors, including visitors setting 
up a commercial presence. 

telecommunication,  news  agency  services, 

Protocol commitments 

In the final, multilateral stage of the accession process, WTO Members collectively sought to 
ensure  the  basic  conformity  of  trade  laws,  regulations,  administrative  procedures  and 
institutions  of  the  Russian  Federation  and  of  the  Customs  Union  (CU)  between  the  Russian 
Federation,  the  Republic  of  Kazakhstan  and  the  Republic  of  Belarus,  where  Russia  had 
transferred its national regulatory competences to the CU, with WTO rules and agreements, 
setting  out  the  corresponding  commitments  in  the  Protocol  of  accession  and  Working  Party 
Report. The following issues are of particular interest to the EU: 

Trading rights 

Russia committed to apply all laws, regulations and other measures affecting importation or 
exportation  of  goods  in  conformity  with  relevant  provisions  of  the  WTO  Agreement, 
including the Agreement on Import Licensing Procedures and the relevant GATT provisions. 
Specifically  with  regard 
importation  of  alcoholic  beverages, 
pharmaceuticals  and  products  with  encryption  techonology,  Russia  agreed  not  to  require 
import or activity licenses in order to undergo customs declaration procedures. Furthermore, 
any  permits, prior  authorisation  and  licensing  requirements  that could not  be justified under 
the provisions  of  the  WTO  Agreement shall be eliminated  and not applied from the date of 
Russia's WTO accession. 

the  regulation  of 

to 

Pricing policies 

Russia committed to apply any existing or future price controls on products and services in a 
manner consistent with the WTO Agreement and confirmed that price control measures will 
not  be  used  for  the  purposes  of  affording  protection  to  domestic  production  of  goods,  or  to 
impare the implementation of Russia's services commitments. With regard to the application 
of  all  rail  transportation  charges,  Russia  undertook  a  commitment  to  accord  imports  and 
exports  treatment  no  less  favourable  than  that  accorded  to  like,  directly  competing  and 
substitutable  products  transported  between  domestic  locations,  no  later  than  1  July  2013. 
Concerning natural gas, Russia agreed to ensure that producers and distributors of natural gas 
in the Russian  Federation operate on the basis of normal commercial considerations and, in 

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respect  to  their  supplies  to  industrial  users,  recover  their  costs,  including  investment  and 
transportation, as well as are able to make a profit. 

Customs procedures and fees 

Concerning customs valuation, Russia committed to apply its laws, regulations and practices 
in line with WTO rules. In particular, Russia would not use any form of minimum value, such 
as reference prices, or fixed valuation schedule for customs valuation of goods. With regard to 
designation  of  specific  customs  checkpoints  for  declaration,  entry  or  exit  of  certain  goods, 
Russia provided an exhaustive list of such measures and undertook a commitment to eliminate 
them  from  the  date  of  accession  if  they  were  contrary  to  the  WTO  Agreement.  Russia 
assumed an obligation to ensure that the level of customs fees, including customs clearance 
fees,  does  not  exceed  the  cost  of  services  rendered.  Finally,  regarding  transit  procedures, 
Russia  shall  apply  all  its  laws,  regulations  as  well  as  other  measures  governing  transit  of 
goods  (including  energy),  such  as  those  governing  charges  for  transportation  of  goods  in 
transit  by  road,  rail  and  air,  and  any  other  charges  and  customs  fees  imposed  in  connection 
with transit, in conformity with the WTO Agreement. 

Technical barriers to trade (TBT) 

Russia  committed  to  ensure  that  all  technical  regulations,  standards  and  conformity 
assessment procedures applied in the territory of the Russian Federation respect principles of 
the WTO TBT Agreement, including transparency, non-disrimination and national treatment. 
Any TBT measures applied in Russia, including those adopted by the competent bodies of the 
Eurasean  Economic  Community  and  the  CU,  shall  be  in  accordance  with  the  WTO 
Agreement. 

Sanitary and phyotsanitary measures (SPS) 

Russia  committed  to  develop  and  apply  all  SPS  measures  in  accordance  with  the  WTO 
Agreement from the date of its WTO accession. In particular, SPS measures shall be applied 
only to the extent necessary to protect human, animal, or plant life or health; shall be based on 
scientific  principles  as  well  as  risk  assessment  and,  where  they  exist,  on  international 
standards,  guidelines,  and  recommendations;  shall  not  be  more  trade  restritive  that  it  is 
required to achieve the appropriate level of protection applied in the Russian Federation; and 
shall integrate the implementation of the equivalence principle. 

Trade-related Aspects of Intellectual Property Rights (TRIPS) 

Russia undertook a commitment to apply fully the provisions of the WTO TRIPS Agreement 
from  the  date  of  accession  to  the  WTO,  including  provisions  for  enforcement,  without 
recourse to any transitional period. 

III. RECOMMENDATION 

In submitting the terms of Accession of the Russian Federation to the WTO for approval by 
the Council, the Commission considers these terms as representing a balanced but ambitious 
package of market opening as well as regulatory commitments, which will bring substantial 
benefits to the EU, to the Russian Federation and its WTO trading partners alike. 

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2011/0320 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be adopted on behalf of the European Union within the relevant instances of 
the World Trade Organization on the accession of the Russian Federation to the World Trade 
Organization 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 91, 
100(2) and 207(4) first subparagraph, in conjunction with Article 218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

In June 1993 the Government of the Russian Federation applied for accession to the Agreement 
establishing the World Trade Organization (WTO), pursuant to Article XII of that Agreement. 

A Working Party on accession of the Russian Federation was established on 16-17 June 1993 in 
order  to  reach  agreement  on  terms  of  accession  acceptable  to  the  Russian  Federation  and  all 
WTO Members. 

The Commission, on behalf of the Union, negotiated a comprehensive series of market opening 
and  other  regulatory  commitments  on  the  part  of  the  Russian  Federation  which  satisfy  the 
Union's  requests  and  objectives  and  are  in  line  with  the  development  level  of  the  Russian 
Federation. 

These commitments are now embodied in the Protocol of Accession of the Russian Federation 
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 Russian Federation. 

(6) 

The Protocol of Accession should therefore be approved. 

(7) 

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. 

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(8) 

Accordingly, it is necessary to establish the position to be taken on behalf of the Union within 
the relevant instances of the WTO, be it the Ministerial Conference or the General Council of 
the WTO, 

HAS ADOPTED THIS DECISION:  

Sole Article 

1. 

2. 

The position to be adopted on behalf of the European Union within the relevant instances of 
the WTO on the accession of the Russian Federation to the WTO, is to approve the accession. 

This decision shall enter into force on the day of its adoption.  

Done at […], 

For the Council 
The President 

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