Proposal for a COUNCIL DECISION establishing the position to be taken by the European Union within the General Council of the World Trade Organization on the accession of the Republic of Kazakhstan to the WTO
Date: 2015-07-01
Institutions: European Commission
Subjects: Kazakhstan, World Trade Organisation, accession to an agreement, trade relations

EUROPEAN 
COMMISSION 

Brussels, 1.7.2015  
COM(2015) 322 final 

2015/0141 (NLE) 

Proposal for a 

COUNCIL DECISION 

establishing the position to be taken by the European Union within the General Council 
of the World Trade Organization on the accession of the Republic of Kazakhstan to the 
WTO 

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EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

Members  of  the  World  Trade  Organization  (WTO)  and  the  Republic  of  Kazkahstan  have 
reached the concluding stage of an agreement on the terms for the accession of the Republic 
of  Kazakhstan  to  the  organization.  This  comes  after  20  years  of  negotiations,  which  began 
when  the  Republic  of  Kazakhstan  submitted  its  application  to  join  the  WTO  in  1996.  A 
summary of the terms of the accession is set out below under point 5. 

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

• 

Consistency with existing policy provisions in the policy area 

Multilateralism is at the heart of EU's trade policy and the EU supports the WTO accession of 
third countries on right terms.  

• 

Consistency with other Union policies 

Consistent  with  the  EU  external  action,  the  proposal  will  anchor  Kazakhstan  in  the 
multilateral trading system and pave the way for the implementation of a new Partnership and 
Cooperation Agreement between Kazakhstan and the EU. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

A  Council  Decision  approving  the  terms  of  the  Republic  of  Kazakhstan's  accession  to  the 
WTO is required by Article 218(9) of the Treaty of the Functioning of the European Union 
the TFEU, before the EU can formally support that approval in the WTO. 

• 

Subsidiarity (for non-exclusive competence)  

Not applicable. EU exclusive competence for trade. 

• 

Proportionality 

An Article 218(9) Council Decision is required. 

• 

Choice of the instrument 

An Article 218(9) Council Decision is required. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

Not applicable 

• 

Stakeholder consultations 

Not applicable 

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• 

Collection and use of expertise 

Not applicable 

• 

Impact assessment 

Unnecessary. An Article 218(9) Council Decision is required. 

• 

Regulatory fitness and simplification 

The proposal is not linked to REFIT 

• 

Fundamental rights 

The proposal has no consequences for the protection of fundamental rights. 

4. 

BUDGETARY IMPLICATIONS 

The proposals have no budgetary implications. 

5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

Not applicable 

• 

Detailed explanation of the specific provisions of the proposal 

Summary of terms of accession 

Schedules of commitments 

Goods (overall) 

The Tariff Schedule of Kazakhstan consists of 11,812 national tariff lines (at 10-digit level). 
There are 2,441 agriculture tariff lines, and 9,371 non-agiculture tariff lines. 

Kazakhstan will complete the implementation of its bound rate commitments in 5 years from 
its date of accession (2020). For the tariff lines that have an AdValorem rate ( 10,602 out of 
the 11,812) the average final bound rate (FBR) in the accession schedule of Kazakhstan is 6.9 
%.  

The rates are in many cases lower than those  of the Eurasian Economic Union. Kazakhstan 
intends to discontinue the exemptions on which they are based and to align its rates with those 
of the Union. The process will start no earlier than three years and six months after the full 
implementation  of  final  bound  rates  and  be  based  on  a  specific  mechanism  designed  in  the 
Working Party Report (see below).  

Tariffs for Industrial Goods  

– 

– 

– 

– 

The average FBR for non-agricultural products is 6%. 

The  highest  averages  of  around  8%-10%  are  observed  in  furniture,  glass, 
ceramics.  

Kazakhstan concedes duty-free treatment for Pharmaceuticals and Information 
Technology products, binding the final bound rates for these products at 0%. 

The highest tariff peaks are at 15% for certain non-ferrous metals and furniture.  

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– 

There  are  Non-Ad-Valorem  FBR  commiments  for  some  industrial  goods: 
specific rates for textiles and footwear, and compound rates for used passenger 
cars. 

Tariffs for Agricultural Goods  

– 

– 

There  is  an  AdValorem  commitment  for  71%  of  Kazakhstan  agriculture 
products schedule. The average FBR commitment for those tariff lines is 8.3%.  

In  agriculture,  the  Non-Ad-Valorem  commitments  consist  of  specific,  mixed 
and compound FBR applicable mainly to poultry, cheese, confectionery, wine, 
spirits, fruit juices and rice. 

Export duties 

The  Republic  of  Kazakhstan  has  undertaken  commitments  to  remove  or  reduce  and  not  to 
introduce  new  export  duties  for  370  products  of  interest  to  EU  exporters.  Moreover,  in  the 
event of unification of export duties within the Eurasian Economic Union, Kazakhstan's rates 
will be reduced to the lowest ones bound by either Kazkahstan or the Russian Federation 

Services  

The  Republic  of  Kazakhstan  will  undertake  market  access  and  national  treatment 
commitments in a broad range of services sectors, including professional, computer and other 
business  services,  communication  services,  construction  services,  distribution  services, 
educational  services,  environmental  services,  financial  (insurance  and  banking)  services, 
health and social services, tourism services and transport services. 

Protocol commitments 

In the final, multilateral stage of the accession process, WTO Members collectively sought to 
ensure the basic compatibility of the republic of Kazakhstan’s trade laws and institutions with 
WTO rules and agreements, setting these out in the Protocol of Accession and Working Party 
Report.  Against  this  background,  the  Republic  of  Kazakhstan  has  undertaken  standard 
Working  Party  Report's  commitments  and  renounced  to  any  transitional  periods,  except  as 
regards the WTO Agreement on Trade Related Investment Measures. 

The following issues are of particular interest to the EU: 

Acces to pipelines 

Foreign invested juridical persons of Kazakhstan, producing crude oil and gas in accordance 
with  the  national  legislation  of  Kazakhstan,  will  be  provided  non  discriminatory  access  to 
pipelines  which  are  partly  or  fully  owned  and  regulated  by  the  Government  in  accordance 
with the national legislation within the available remaining capacities of such pipelines, based 
on existing rights of access. 

State-owned  and  State-controlled  Enterprises,  Enterprises  with  Special  and  Exclusive 
Privileges  

From the date of accession such enterprises, when engaged in commercial activity, will make 
purchases, which are not intended for governmental use, and sales in international trade in a 
manner consistent with applicable provisions of the WTO Agreement. These enterprises will 
make  such  purchases  and  sales  in  accordance  with  commercial  considerations,  including 
price,  quality,  availability,  marketability,  and  transportation,  and  will  afford  enterprises  of 
other  WTO  Members  adequate  opportunity  in  conformity with customary business practice, 
to compete for participation in such purchases or sales. 

Pricing policies 

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From the date of accession, Kazakhstan will apply price controls on products and services in a 
manner  consistent  with  the  WTO  Agreement,  taking  into  acocunt  the  interests  of  exporting 
Members.  Price  control  measures  will  not  be  used  for  purposes  of  affording  protection  to 
domestic production of goods, or to impair the services commitments of Kazakhstan.  

Future alignment of Kazakhstan's and Eurasian Economic Union's tariff rates 

A  special  mechanism  has  been  established  to  ensure  that  appropriate  compensation  to  the 
WTO  members  concerned  takes  place  before  the  tariff  rates  are  aligned.  In  case  the  agreed 
compensation  is  not  applied  by  the  Eurasian  Economic  Union,  the  rates  in  Kazakhstan's 
schedule will continue to apply. 

Customs Valuation 

From the date of accession, Kazakhstan will apply its customs valuation laws, regulations and 
practices, including those to prevent under valuation of goods, in conformity with the WTO 
Agreement,  including  Article  I  of  the  WTO  General  Agreement  on  Tariffs  and  Trade  1994 
and the WTO Agreement on Implementation of Article VII of the GATT 1994. Accordingly, 
Kazakhstan  will  not  use  any  form  of  minimum  value,  such  as  reference  prices,  or  fixed 
valuation schedule for customs valuation of goods. 

Sanitary and Phytosanitary Measures 

Kazakhstan has committed to negotiate and mutually agree on bilateral veterinary certificates 
with a third country for the goods subject to veterinary control imported into the territory of 
Kazakhstan until Eurasian Economic Union veterinary certificates with the third country for 
such  goods  enter  into  force  (such  certificates  have  been  negotiated  between  the  EU  and 
Kazakhstan  and  should  enter  into  force  on  15  July  2015).  Moreover,  in  implementing 
Eurasian  Decisions,  Kazakhstan  will  neither  require  an  establishment  to  be  included  in  a 
Register nor require a successful audit as a pre-condition for importation into Kazakhstan of 
low-risk products. Furthermore, in cases in which no mandatory veterinary or phytosanitary, 
or  sanitary  epidemiological  and  hygienic  requirements  had  been  established  at  Eurasian  or 
national  level,  Kazakhstan  will  apply  the  relevant  international  standards,  guidelines  and 
recommendations  in  accordance  with  the  WTO  SPS  Agreement.  In  cases  where  an  SPS 
measure  in  force  is  not  based  on  international  standards,  where  they  exist,  the  relevant 
international  standards  or  parts  thereof  will  be  applied  in  Kazakhstan,  unless  a  scientific 
justification of such measure is provided in accordance with the WTO SPS Agreement. 

Government Procurement Agreement 

Kazakhstan  intends  to  join  the  WTO  Agreement  on  Government  Procurement.  Kazakhstan 
will  request  the  status  of  an  "observer"  to  the  Agreement  upon  accession  and  submit  an 
application  for  membership  with  a  coverage  offer  within  four  years  after  accession  to  the 
WTO.  

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2015/0141 (NLE) 

Proposal for a 

COUNCIL DECISION 

establishing the position to be taken by the European Union within the General Council 
of the World Trade Organization on the accession of the Republic of Kazakhstan to the 
WTO 

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 the first subparagraph of Article 207(4), in conjunction with Article 
218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

On  29  January  1996  the  Government  of  the  Republic  of  Kazakhstan  applied  for 
accession  to  the  Marrakesh  Agreement  establishing  the  World  Trade  Organization 
(WTO), pursuant to Article XII of that Agreement. 

A Working Party on the accession of the Republic of Kazakhstan was established on 6 
February  1996  in  order  to  reach  agreement  on  terms  of  accession  acceptable  to  the 
Republic of Kazakhstan and all WTO Members. 

The  Commission,  on  behalf  of  the  Union,  has  negotiated  a  comprehensive  series  of 
market opening commitments on the part of the Republic of Kazakhstan which satisfy 
the Union's requests on tariffs, on export duties and on trade in services. 

These commitments are now embodied in the Protocol of Accession of the Republic of 
Kazakhstan 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 
Kazakhstan. 

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 Union within 
the General Council of the WTO on the accession of the Republic of Kazakhstan to the 
WTO, 

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HAS ADOPTED THIS DECISION:  

Article 1 

The  position  to  be  taken  by  the  European  Union  within  the  General  Council  of  the  World 
Trade Organization on the accession of the Republic of Kazakhstan to the WTO is to approve 
the accession. 

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

Done at Brussels, 

Article 2 

For the Council 
The President 

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