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USTR Issues Second Annual Report on Russia’s WTO Compliance

Monday, June 23, 2014
Sandler, Travis & Rosenberg Trade Report

The Office of the U.S. Trade Representative has issued its second annual report describing the enforcement actions taken by the agency to ensure Russia’s full compliance with its World Trade Organization obligations. The report indicates that USTR has grown increasingly concerned about Russia’s implementation of its commitments as well as its dedication to the goals of the WTO with respect to trade liberalization, rule of law and transparency. U.S. trade officials have met with their Russian counterparts over the past year to raise these concerns and have “aggressively highlighted” potentially WTO-inconsistent behavior in WTO committee meetings. In addition, USTR has worked to establish alliances with like-minded trade partners to urge Russia to modify its behavior and avoid taking certain actions.

The report indicates that Russia has not adequately harmonized its sanitary and veterinary measures with relevant international standards, adopted inspection guidelines in accordance with the Codex Alimentarius, or ensured that domestic SPS measures that are more stringent than international standards are based on science and risk analyses. Specific concerns in this area include Russia’s near zero tolerance for tetracycline residues as well as a zero tolerance for ractopamine and certain hormones in pork and beef. In addition, despite a bilateral agreement with Russia granting U.S. Food Safety and Inspection Service officials the authority to certify U.S. meat and poultry establishments to export their products to Russia, Moscow has not consistently recognized FSIS’s authority to certify additional U.S. facilities and there have been delays in responding to U.S. requests to update the list of approved facilities.

The report acknowledges that Russia has provided WTO members a significant number of laws, decisions, regulations, resolutions and other measures related to its foreign trade regime and its implementation of WTO rules. However, a transparent, standardized system for providing notifications on issues such as technical barriers to trade is not yet in place. The U.S. will continue to encourage the development of such a system and conduct other efforts to improve transparency in Russia.

The U.S. has also raised questions about Russia’s establishment of an import licensing regime imposing a quota on certain pipe products. Furthermore, U.S. authorities do not agree with the process for obtaining an import license for products with cryptographic capabilities, reminding Russia of the requirement that license applications should be processed in not more than 60 days. The U.S. has also raised concerns about the final safeguard measure on combine harvesters and modules imposed by the Eurasian Economic Commission in the form of an import quota. Other issues mentioned in the report include burdensome and unnecessary restrictions on the storage of alcoholic beverages, duplicative registration requirements for alcohol, a seemingly discriminatory automotive recycling fee, Russia’s administration of its automotive industry investment incentive program, and a leasing program to supply agricultural equipment to farmers. 

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