Russia is continuing to move away from the guiding World Trade Organization principles of non-discrimination, free trade, predictability, transparency, and fair competition, according to the Office of the U.S. Trade Representative’s annual report on Russia’s compliance with its WTO accession commitments.
Among other things, the report states that Russia maintains restrictive at-the-border measures, institutes behind-the-border measures to inhibit trade, and implements an industrial policy seemingly driven by the guiding principles of import substitution and forced localization. USTR indicates that the U.S. will continue to press Russia to comply with its WTO commitments and pursue market-based principles.
The report identifies a number of non-tariff barriers to importing into and exporting from Russia, including the following.
- a ban on imports of nearly all agricultural goods from the U.S. and other WTO members
- quantitative restrictions or outright bans on certain agricultural exports
- localization measures that provide preferential treatment to domestically produced goods and services
- duplicative and cumbersome labeling and traceability regimes that create additional burdens at the border
- import substitution strategies for the IT sector that raise national treatment and import substitution concerns
- a growing number of import substitution requirements on state-owned and state-controlled enterprises
- a lack of clear regulations governing customs valuation that create uncertainty and additional paperwork
- various policies and practices that may not be consistent with national treatment obligations, such as Russia’s recycling fee, value-added tax exemption for royalties paid on domestic software, copyright levy system, and VAT on movie distribution
- weak intellectual property enforcement efforts and failure to meet certain WTO commitments in this area
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