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Eurasian Economic Union kicks off New Year with new customs code entering into force

The customs code hammered out in 2009 at the dawn of the formation of the Customs Union of Belarus, Kazakhstan and Russia can be seen as the blueprint for the new code

MOSCOW, January 1. /TASS/. The new Customs Code of the Eurasian Economic Union (EAEU) comes into force on January 1. Five countries - Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia - have been working on the Code for two years. According to the Russian Customs Service, the new code will become one of the most innovative international documents in the field of customs service.

The customs code hammered out in 2009 at the dawn of the formation of the Customs Union of Belarus, Kazakhstan and Russia can be seen as the blueprint for the new code. However, it has become obsolete by 2015, when the agreement on the establishment of the EAEU came into force. Together with Russia, Belarus and Kazakhstan, the Eurasian Union then added Kyrgyzstan and Armenia to its ranks.

Once work on the document got started, the countries set ambitious goals - to bring together the customs laws of the EAEU space and to boost the trade relations of its countries with the help of digital technologies. "This is a landmark event and I hope that the World Bank will take this factor into account and it will have a positive ripple effect our Doing business rating. The code in general reflects the same processes that occur in the Federal Customs Service of Russia. It spells out the automation of all procedures and it significantly changes the institution of an authorized economic manager," First Deputy Head of the Russian Customs Service Ruslan Davydov told TASS.

Central role

Thanks to the efforts by EAEU members, the code has a centralizing role. A greater part of the powers is transferred from the national to the union level by the code. The number of rules and regulations that are now determined solely by the union (unified for the participating countries) has increased from 114 to 297. However, this does not mean that states are told how to regulate this area in each particular country.

Orientation on business

The code’s main innovation, according to experts, is the extensive involvement of business in its preparation. Before that, no document, neither international nor national, was discussed in such detail with the business community. "Of course, not all business proposals were accepted. Business, of course, ideally would like to abolish all duties and customs, but the state has goals regarding the budget and ensuring the country's security," Deputy Director General of the Multiservice Payment system Andrey Cheshko told TASS.

An authorized economic operator is a new development included in the code. This is a category of organizations that have proven their reliability, and for which serious simplification of customs control procedures is applied. The new code divides them into three categories and expands customs benefits for them.

Customs digitalization

Acceleration and simplification of customs operations between the EAEU members by automation of customs procedures. The code prioritizes electronic customs declaration, the opportunity not to furnish supporting documents and automatic release of goods.

According to the Russian Customs Service, electronic declaration is currently used in more than 99% of cases. The next stage will be the transition to an automatic release of goods for 80% of declarations of companies with low risk. So far, out of 3.7 million declarations filed in 2017, only 53,600 goods were released without participation of customs officers.

Duty free threshold

Changes to the new code will affect citizens as well. The EAEU countries included a gradual reduction of the threshold for duty-free import of goods in the code - up to 500 euro in 2018, and up to 200 euro in 2019. At the same time, countries will have the right to individually set smaller thresholds. For example, for Belarus the figure reaches 22 euro. In Russia, the threshold remains at the level of 1,000 euro and the government has not yet made a decision on its reduction.

Russian law

In order to make the code effective, participating countries must streamline their national legislation to the document. At the moment, the Russian law on customs regulation has been agreed on by all interested parties, submitted to the government and should be sent to the State Duma in the near future. "The situation is not the most comfortable when, as of January 1, 2018, the new code comes into force and our law does not. However, in fact this situation is the same in all the countries of the Eurasian Union and the norms of the code will operate and we will implement them," Davydov said.

The Russian Customs Service has set up advisory bodies for helping foreign trade participants. The main office was set up in the Russian Customs Service, which will coordinate with customs officers and help apply the uniform norms of the new customs code. Also in all regions of Russia, "hotlines" have been set up to help with any issues that may arise due to the implementation of the new code.