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American Chamber of Commerce Calls for Parliament Support of the President´s Proposals to the Draft Customs Code

07.02.2012 |

The American Chamber of Commerce in Ukraine appeals to the Verkhovna Rada to support the President´s proposals to the draft Customs Code of Ukraine received on December 21st, 2011, and in order to improve the investment climate of Ukraine to consider and pass the aforesaid piece of legislation during the current parliamentary session.

On November 3rd, 2011 the Verkhovna Rada of Ukraine adopted a new Customs Code that provided for harmonization of customs procedures and formalities as well as bringing them in accordance with the International Convention on the Simplification and Harmonization of Customs Procedures (Kyoto Convention) and European legislation.

The American Chamber of Commerce has been actively involved in the process of developing the proposals and discussing the draft law with the representatives of the Parliamentary Committee on Finance, Banking, Tax and Customs Policy. However, the provisions of the Draft Law were significantly changed right before its adoption by the Parliament in the second reading which altered the overall positive direction of the document, in particular the regulations regarding customs value and customs brokers activities.

Most notably, the adopted Customs Code significantly shortened the duration of warranties which allowed the importers to prove authenticity of the declared customs value from 90 days to 30 days. The Law also provided for establishment of the formal grounds for refusing to recognize the customs value in case a certain additional document was not submitted. First and last, proposed mechanism for determining the customs value was simply contradicting to the WTO rules and would have significantly reduced the importers´ chances to win customs value disputes with state customs authorities.

In addition, the Customs Code significantly tightened regulations for the customs brokers. According to the law they would have to provide the guarantee as to fulfillment of their obligations in favor of the budget in amount of 300,000 euros as well as send their employees (customs clearance agents) to educational institutions under the State Customs Service to get additional professional training. Such strict requirements could have resulted in significant reduction in the number of customs brokers´ enterprises since the majority of them belong to the small-sized and medium-sized businesses. The outcomes also could have negatively affected the quality and price of the brokers´ services.

The American Chamber of Commerce has expressed its concerns regarding the aforesaid provisions of the Customs Code of Ukraine and by appealing to the President shared the position of the business community. After taking these proposals into consideration on December 21st, 2011, the President of Ukraine returned the Customs Code with his comments for additional review to the Verkhovna Rada in order to prevent narrowing of the existing rights and freedoms of the citizens.

Business community represented by the American Chamber of Commerce supports the President´ proposals regarding the Customs Code and advocates for their prompt consideration and review by the Parliamentary Committee on Finance, Banking, Tax and Customs Policy.

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