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U.S. Assesses Russia’s WTO Compliance in First Annual Report to Congress

Tuesday, December 24, 2013
Sandler, Travis & Rosenberg Trade Report

The Office of the U.S. Trade Representative released last week its first annual assessment of Russia’s compliance with its World Trade Organization commitments. A USTR press release states that the report reviews specific commitments that Russia undertook as part of its accession to the WTO as well as Russia’s implementation of those commitments. The report indicates that while Russia has taken many important steps to implement all of its WTO commitments in most areas there are several areas where more progress is required. Positive developments include Russia’s reduction of import tariffs upon becoming a WTO member and again one year after accession, the completion of a process to join the Information Technology Agreement and the simplification of border procedures.

On the other hand, the Eurasian Economic Commission introduced some “combined tariffs” (adding a minimum specific duty to ad valorem rates) on both agricultural and industrial goods that the U.S. will monitor to ensure consistency with Russia’s WTO bound rates. In addition, the U.S. is concerned about the recent imposition of a safeguard measure on combine harvesters and is also watching Russia’s export regulatory regime (especially with regard to ferrous scrap) as well as its regulatory regime for the importation and distribution of encryption products and alcoholic beverages.

Questions also remain regarding Russia’s application of the WTO Agreement on the Application of Sanitary and Phytosanitary Measures as well as its adoption of international standards and the development of inspection guidelines, establishment lists and veterinary certificates. Other issues mentioned in the report include Russia’s regime for collecting copyright levies on products that can be used to reproduce copyrighted material for personal use and its application of a value added tax on royalties for cinema products. A recycling fee introduced shortly after Russia became a WTO member has been amended to cover domestically produced motor vehicles (in addition to imported motor vehicles) but the U.S. remains concerned about the overall level of that fee.

The USTR plans to continue to closely monitor Russia’s implementation of its WTO commitments and intends to use all appropriate means to resolve any concerns.

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