Friday, March 17, 2017

Trade Facilitation Agreement and Armenia

The World Trade Organization, the successor of GATT, has finally achieved a major milestone since its formation 22 years ago. The Trade Facilitation Agreement (TFA), the first multilateral deal, entered into force on February 22, 2017 after two-thirds of its members ratified it. The TFA negotiations were concluded at the WTO Bali Ministerial Conference in December of 2013 and the WTO has been accepting notifications of ratification from its members since November of 2014. The primary goals of TFA are to expedite the movement, release and clearance of goods across borders, and implement trade facilitation reforms across all countries through harmonization of customs procedures and elimination of red tape. These factors were found to be the most important component of trade costs, especially in developing countries. Developing countries were also given more time to implement the TFA depending on their capacities. A TFA Facility was established to provide assistance to developing countries in assessing their needs for implementing TFA in the form of training and grants.

In addition to ratifying the agreement, the countries need to submit a list of provisions they designate as Category A, B or C commitments, with Category A commitments being immediately applied upon TFA’s entry into force. For the other provisions of the Agreement, developing countries need to indicate when these will be implemented and what capacity building support is needed to help them implement.

Given the direct benefits from TFA to developing countries, it comes as a surprise why Armenia,  a WTO member since 2002, has not yet ratified the agreement. There are some indications that the discussions of the TFA ratification in the Armenian parliament had begun in February of 2017, more than three years after the negotiations have been concluded.

Armenia’s major trading partners, the European Union and Russia, have already ratified the TFA, so did five other former Soviet republics (Georgia, Moldova, Kazakhstan, Kyrgyz Republic, and Ukraine). The table below shows the various provisions the latter group of countries designated as “Category A” commitments:

Provision
Heading/Description
Georgia
Kyrgyz Republic
Kazakhstan
Moldova
Ukraine
Article 1.1
Publication
A
A
A
Article 1.2
Information Available through Internet
A
A
Article 1.3
Enquiry points
A
Article 1.4
Notification
A
A
Article 2.1
Opportunity to Comment and Information Before Entry into Force
A
A
Article 2.2
Consultations
A
Article 3
Advance Rulings
A
A
Article 4
Procedures for Appeal or Review
A
A
A
A
Article 5.1
Notification for Enhanced Controls or Inspections
A
A
Article 5.2
Detention
A
A
A
A
Article 5.3
Test Procedures
A
A
Article 6.1
General Disciplines on Fees and Charges Imposed on or in Connection with Importation and Exportation
A
A
Article 6.2
Specific Disciplines on Fees and Charges for Customs Processing Imposed on or in Connection with Importation and Exportation
A
A
Article 6.3
Penalty Disciplines
A
A
Article 7.1
Pre-arrival Processing
A
A
A
Article 7.2
Electronic Payment
A
A
Article 7.3
Separation of Release from Final Determination of Customs Duties, Taxes, Fees and Charges
A
A
Article 7.4
Risk Management
A
A
A
A*
Article 7.5
Post-Clearance Audit
A
A
A
Article 7.6
Establishment and Publication of Average Release Times
A
Article 7.7
Trade Facilitation Measures for Authorized Operators
A
Article 7.8
Expedited Shipments
A
A
Article 7.9
Perishable Goods
A
A
A*
Article 8
Border Agency Cooperation
A
A
A
A
Article 9
Movement of Goods Intended for import under Customs Control
A
A
A
A
A
Article 10.1
Formalities and Documentation Requirements
A
A
Article 10.2
Acceptance of Copies
A
A
Article 10.3
Use of International Standards
A
A
Article 10.4
Single Window
A
Article 10.5
Pre-shipment Inspection
A
A
A
A
Article 10.6
Use of Customs Brokers
A
A
A
Article 10.7
Common Border Procedures and Uniform Documentation Requirements
A
A
A
Article 10.8
Rejected Goods
A
A
A
A*
Article 10.9
Temporary Admission of Goods and Inward and Outward Processing
A
A
A
A
Art. 11.1-11.2
Freedom of Transit
A
A
A
A
Art. 11.3-11.4
Freedom of Transit
A
A
A
Art. 11.5
Freedom of Transit
A
Art. 11.6-11.8
Freedom of Transit
A
A
Article 11.9
Freedom of Transit
A
A
Art. 11.10
Freedom of Transit
A
A
Art. 11.11-11.12
Freedom of Transit
A
A
A
Art. 11.13
Freedom of Transit
A
A
Art. 11.14-11.16
Freedom of Transit
A
A
A
Art. 11.17
Freedom of Transit
A
A
Article 12
Customs cooperation
A
A
* except for Art.7.4.1, Art.7.4.2, Art.7.4.3, Art.7.9.1, Art.7.9.2, Art.10.8.2
Source: compiled from www.tfafacility.org/notifications

No comments: