E c o n o m asian Eur Int i n of eg c y r a r at i a i r o n U s ib L n a i

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F A S C E T R S U A N D F I G

1H 2017 Eurasian Economic Commission

Contents

Introduction by the Chairman of the Board of the Eurasian Economic Commission ...... 2

Development of the Eurasian Integration: 1994–2017 ...... 4

Timeline of Events ...... 10

The Member States of the Eurasian Economic Union. Position in the world ...... 12

From the Customs Union to the Eurasian Union ...... 20

Institutions of Eurasian Economic Integration ...... 32

Management Bodies of the Eurasian Economic Union ...... 34

Activity areas of the Eurasian Economic Commission ...... 38

Procedure for preparation and execution of international instruments ...... 50

Interaction of the EEC with Business Community of the Member States of the Eurasian Economic Union ...... 52

Eurasian Integration as а Part of Global Economy ...... 56

Integration Segment of Economies of the EAEU Member States ...... 70

Contact Information of the Eurasian Economic Commission ...... 75

1 Eurasian Economic Integration: Facts and Figures

Introduction by the Chairman of the Board of the Eurasian Economic Commission

Dear readers and 50 states and the leading international 2017 is one of the most notable from colleagues! interstate unions. Treatments on the point of view of the efficiency of preferential trade regimes or free trade work made by the Commission. In April I am pleased to represent for you an zones agreements were concluded or the new EAEU Customs Code was annual digest in which by means of pending conclusion with some of them, adopted. The document focuses on the facts and figures, statistical informa- for example, with Vietnam, India, Iran, application of paperless electronic tion and analytical summaries presents Singapore and with a number of other technologies and online services. It the results of the Eurasian Economic states. also contributes for greater simplifica- Commission on the deepening of the tion of many procedures. In May this integration union of five states – Arme- As a result of establishment of the year, in the Union began to work nia, Belarus, Kazakhstan, Kyrgyzstan Common economic Space business markets of medicines and medical and Russia. had unrestricted access to the devices. Within the territory of EAEU a markets of the Member States. The new technical regulations were Looking back, it can be stated with services freedom of movement has adopted. They cover safe handling of confidence that a lot of previously set been already provided in 43 sectors. clean drinking water and fire-protec- out objects, while establishing the There are plans under way to form tion equipment, as well as chemicals Eurasian Economic Union (EAEU), have coherent policies in transport, and playground equipment safety. become a reality. Due to political will of industry and agriculture. The citizens our state leaders was created and of the Union obtained an opportunity These are all very significant results of started to act the Common Economic to live, study and work in any Member integration, which significantly reduce Space. It is a global market that unites States without an authorization and a time and resource costs both for more than 180 million people. Its main non-quota basis as well as a free entrepreneurs of the EAEU Member principles freedom of movements of emergency health care etc. States and their business partners from goods, services, labour and capital. It third countries. has been created an integration A large scale digital base for a new structure, sustainable to any world leap forward of economy is forming The EEC monitors the implementation crises, with substantial potential for within the Union and it’s considered as of the Treaty on the EAEU. The essen- further development. An increase of a fundamental priority for further tial part of these activities is to identify domestic trade and deepening of development of the EAEU. At the level barriers to the movement of goods, cooperation between entities and of the EAEU has been created the services, labour and capital. We facilitation of conditions for labour working group that includes the systematically discuss these problems migration that are some actual results vice-premiers of the national govern- on the level of the five states and jointly of our work. It could be hardly to ments of the Union with the aim to eliminate them. Now 60 obstacles have achieve without enhanced support of develop the Main directions for been recorded in the Union, and on the presidents, prime-ministers, as well realization of the EAEU digital until many of them have been reached as without the active participation of 2025. Digitalization of all spheres will resolving agreements. the national authorities representatives change the image of economy, models and business. Due to help of all and methods of data management, The digest, I would like to represent, is concerned parties the EAEU is working products and services, state functions also belongs to the essential part of the systematically towards realization of and formats of its cooperation with integration process. It dwells on the the main directions, including custom society. Forming the EAEU common Eurasian integration, its goals and cooperation, industry and agricultural digital space we are eager to create perspectives. I hope it will be interest- development, technical regulation, new institutions and infrastructure ing to anyone, who wants to become a veterinary and phytosanitary inspec- that ensure multiplicative effect for a participant to one of the significant tions. large number of spheres and sectors projects in Eurasia which has of economy. We need to develop an already become a reality The success of the Eurasian Integration electronization programme of the and will have a great process is already evident. Today the Union – “GOELRO-2Plan” which will future! Commission jointly with the Member become one of the main drivers to States is developing trade and eco- modernize the Member States nomic cooperation with approximately economies. Tigran Sargsyan

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3 Eurasian Economic Integration: Facts and Figures

Development of the Eurasian Integration: 1994–2017

1994

In recent history of the Eurasian integration a new 1996 chapter began. Each page is valuable and significant In 1996, the Leaders of the three states, togeth- in its own way. It cannot be torn out of the single er with the Head of the Kyrgyz Republic, signed book for the Member States of the Union without the Treaty on Deepening Integration in Economic prejudice to the meaning, and its content continues and Humanitarian Areas. The document reflected to be added daily. The prologue of this big book close economic and cultural ties, common history. starts in 1994, when the leader of the Republic of However, the provisions of the Treaty looked into Kazakhstan Nursultan Nazarbayev proposed creation the future – the Republic of Belarus, the Republic on the Eurasian space of a really working union of of Kazakhstan and the Russian Federation stated states integrated with economic relationships. the indissoluble prospects for a common economic development. 1995 1998 In early 1995, the Republic of Kazakhstan, the Republic of Belarus and the Russian Federation In 1998, the Republic of Tajikistan joined the Treaty. signed the Agreement on the Customs Union aimed at removing obstacles to free economic in- The intention to move towards closer cooperation on teraction between economic entities of the parties, the basis of unification of the regulatory framework and as well as ensuring free trade and fair competition. harmonization of processes of economic restructuring The Customs Union of the 1990s failed to really has led the leaders of these countries to the creation operate for a number of reasons. However, the in 2000 of a new integration structure – the Eurasian experience obtained was indispensable to develop Economic Community (EurAsEC). further effective strategy for a phased convergence of neighbouring countries, which are best prepared for integration.

The Treaty on Deepening of Integration in Economic and Humanitarian Areas

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uted to the convergence of economic policies. All this resulted in the acceleration of the “launch” of the Customs Union.

2010 The Customs Union of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation began its work in January 2010 and just a year and a half after, in July 2011, it started to operate at its full capacity: the customs territories of three states were combined into the common customs territory. Within the territory, the rules of the Customs Code, the single The Agreement on Formation of the Common Economic customs tariff, the single system of foreign trade and Space customs regulations, as well as the common legal framework in the sphere of technical regulation began to be applied. 2011 On November 18, 2011, Presidents Alexander Lu- kashenko, Nursultan Nazarbayev and Dmitry Medve- dev signed a Declaration on the Eurasian Economic 2003 Integration. Having noted success of the Customs Union in this document, the Heads of the Republic of Since 2003, the work on formation of the legal frame- Belarus, the Republic of Kazakhstan and the Rus- work of the Common the Economic Space was even sian Federation expressed conviction that the further more intensified. Ukraine joined the process. But its development of integration based on the profound involvement in the Eurasian integration processes economic and spiritual links between the peoples quickly subsided. of the three countries met their national interests, as well as promoted well-being and quality of life of citizens and enhanced national competitiveness in 2006 the global economy. The Declaration announced the In 2006, the Republic of Belarus, the Republic of transition to the next stage of integration – the Com- Kazakhstan and the Russian Federation were again at the forefront of the formation of the Customs Union and the Common Economic Space. The Presidents of these countries made a joint decision at the summit in Sochi. it was agreed that the Kyrgyz Republic and the Republic of Tajikistan would join when their economies are ready.

2007 Just a year later, in October 2007, the Treaty on the Establishment of the Single Customs Territory and Formation of the Customs Union was signed. In a his- torically short period, the countries managed to identify ways to co-develop the Member States. The Treaty on Creation of the Common Customs Territory and Further acceleration of the integration processes was Establishment of the Customs Union greatly due to the global economic crisis of 2008. It forced the states to seek new formats of coop- eration for sustainable economic growth and new ways to minimize economic risks and also contrib-

5 Eurasian Economic Integration: Facts and Figures

mon Economic Space (the CES). The Declaration market operation were an important part of the plans stipulated that the parties would strive to complete, of the CU and the CES Member States to move from by January 1, 2015, the work on codification of inter- resource-based economy to innovation economy. national treaties that constitute the regulatory legal framework of the Customs Union and the Common On February 2, 2012, the Eurasian Economic Com- Economic Space, and create the Eurasian Economic mission (the EEC) started its work. For the first time in a Union on this basis. twenty-year history of the Eurasian integration process, a permanent supranational regulatory body with real powers in a number of key sectors of the economy 2012 was established. The EEC provides conditions for the By January 1, 2012, a legal framework of the CES functioning and development of the Customs Union and as a market with 170 million consumers, free move- the Common Economic Space, and the ela­boration of ment of goods, services, capital and labour, was proposals for the further development of integration. formed. The CES was based on concerted action in key areas of economic regulation: in macroeco- The work began on the codification of the regulatory nomics, competition policy, the field of industrial and legal framework of the CU and the CES and on prepara- agricultural subsidies, transport, energy, tariffs of tion of the draft Treaty on the Eurasian Economic Union. natural monopolies. The benefit from the CES was clear both to the population and to the business 2013 community. Entrepreneurs were given equal access 2013 was one of the most significant periods in the to the common market of three countries, an ability improvement and development of the Eurasian integra- to freely choose where to register their companies tion processes. In particular, there were conditions to and do business, to sell products in any Member continue work to ensure accession of the Kyrgyz Re- State of the CES without undue restrictions, to have public to the Eurasian integration project launched by access to transport infrastructure, etc. Creation and the decision of the EurAsEC Interstate Council which gradual adjustment of mechanisms of the single has been adopted back in 2011.

Commencement of the Common Economic Space

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In May 2013, the Memorandum on deepening coope­ ration between the Eurasian Economic Commission and the Kyrgyz Republic was signed. The purpose of the Memorandum is maintaining and development of cooperation based on the principles of mutual respect, deepening cooperation between the Kyrgyz Republic and the CU and the CES Member States in various economic sectors.

On September 3, 2013, the Armenian President Serzh Sargsyan expressed the country’s intention to join the Customs Union and the CES and to further integrate by participating in the formation of the Eurasian Economic Union.

On October 24, 2013, at the session of the Supreme 29.05.2014 Eurasian Economic Council in Minsk the Presidents of Signing the Treaty on the Eurasian Economic Union the Member States considered the application of the Republic of Armenia and instructed the EEC to launch the work on accession. The Working Group established for this purpose developed a corresponding “road map”. 2014 On December 24, 2013, the road map on acces- sion of the Republic of Armenia to the CU and CES On May 29, 2014, Astana hosted the session of was approved at the level of the Heads of the States the Supreme Eurasian Economic Council, where during the session of the Supreme Eurasian Eco- Pre­sidents Alexander Lukashenko, Nursultan nomic Council. The Presidents of the major three Nazarbayev and Vladimir Putin signed the Treaty states of the Customs Union and Armenia adopted on establishment of the Eurasian Economic Union. the Statement “On participation of the Republic of Many the Etablishment and experts called this Armenia in the Eurasian integration process” and project the most ambitious and at the same time the welcomed the intention of the Republic of Armenia most realistic and relying on the evaluated economic to accede to the Customs Union and the Common advantages and mutual benefits. Ample opportuni- Economic Space, and then become a full member of ties were opened for the business community of the the Eurasian Economic Union. Member States: the Treaty gave the “green light” to the formation of new dynamic markets with single standards and requirements for goods, services, 2013–2014 capital and labour. In 2013-2014, the Eurasian Economic Commission and the authorised authorities of the Republic of Be- On October 10, 2014, the Treaty on Accession of larus, the Republic of Kazakhstan and the Russian the Republic of Armenia to the EAEU was signed in Federation were actively preparing the Treaty on the Minsk. The document was adopted at the session of Eurasian Economic Union (EAEU) on behalf of their the Supreme Eurasian Economic Council, which was Presidents. It included codification of most inter- attended by Heads of the Member States. On the national treaties that constitute the regulatory legal same day, Presidents Alexander Lukashenko, Nursul- framework of the Customs Union and the Common tan Na­zarbayev and Vladimir Putin approved the “road Economic Space. map” for the accession of the Kyrgyz Republic to the Common Economic Space. During this period, 5 rounds of negotiations were held to finalize the draft Treaty, which were attended by On December 23, 2014, Moscow hosted the meet- more than 700 experts from Member States and the ing of the Supreme Eurasian Economic Council, EEC. The final document containing nearly 1000 pages where the President of Kyrgyzstan Almazbek Atam- is divided into 4 parts that include 28 sections, 118 bayev signed the Treaty on Accession of the Kyrgyz articles and 33 annexes. Republic to the EAEU.

7 Eurasian Economic Integration: Facts and Figures

On May 29, 2015, the EAEU Member States and Vietnam signed an agreement on establishment of a free trade zone. The document the suggests zeroing of the duties for 90% of products will give an op- portunity to increase by 2020 the trade turnover of the EAEU Member States and Vietnam more than twice. The agreement marked the beginning of the subsequent closer integration of the EAEU with the Asia-Pacific Region.

In May 2015, the Presidents of the Member States of the Eurasian Economic Union decided to start ne- gotiations with China on conclusion of an agreement on trade and economic the cooperation. This is an important stage in the development of economic co- operation sequencing the entire structure of relations 02.01.2015 and providing a basis for further progress in the area Accession of Armenia to the Eurasian of trade simplification and elimination of non-tariff Economic Union barriers that restrict reciprocal access to markets. In order to organise this activity efficiently, in Octo-

ber 2015 the presidents adopted a disposition on the coordination of Presidents of the EAEU Member States on conjunction of the Eurasian Economic 2015 Union and the Silk Road Economic Belt. Formal ne- gotiations started in the first half of 2016. The Eurasian Economic Union started its operation from January 1, 2015. The Republic of Belarus was On August 12, 2015, after implementation of the “road the first Chairman of the supreme bodies of the asso- map” and the completion of the ratification procedures, ciation – the Supreme Eurasian Economic Council at the Kyrgyz Republic became a full member of the Union. the level of Heads of the States, the Eurasian Intergov- ernmental Council at the level of Heads of the Govern- In October 2015, at the Supreme Eurasian Econom- ments and the EEC Council at the level of Vice Prime ic Council, the Presidents of five Member States of Ministers. the Union approved the Main Directions of Economic Development of the EAEU up to 2030. It is an import- At the same time, from January 1, 2015, a single ser- ant document, which defines further coordination vices market began to operate in a number of sectors of national policies and ways of improving the com- identified by the EAEU Member States. petitiveness of the economies of the EAEU Member States. The effect of participation in the EAEU by 2030 The total number of service sectors in the common is estimated to be 13% of additional GDP growth for market is 43. In value terms, it is almost 50% of the the Member States. total volume of services in the Member States of the Union. Currently, the parties are actively working on expansion of these sectors by, among other things, 2016 the phased reduction of exemptions and restrictions, which will strengthen the Eurasian integration project. From February 1, 2016, new members of the Board of the Eurasian Economic Commission (EEC) chaired From January 2, 2015, after the completion of the rati- by the representative of the Republic of Armenia fication procedures, the Republic of Armenia became a Tigran Sargsyan started their work. Most of the full member of the Eurasian Economic Union. members of the Board exercised their powers in the previous four-year cycle of the EEC operation, which In March 2015, the first documents necessary to ensured a high level of continuity in the Commission. launch operation in the Union of the common markets The decision that the former Prime Minister of Arme- of medicines and medical products were presented nia Tigran Sargsyan would head the Board of the EEC for public discussion. October 2015 saw the last of the was made in October 2015 at the session of the Su- thirty-five documents adopted by the EAEU countries preme Eurasian Economic Council by the Presidents and the Commission. of the five countries of the Eurasian Economic Union

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(EAEU) in the Kazakh village Burabay. Taking into economic cooperation in the EAEU may be a direct account the four-year practice of the Commission, dialogue between the Eurasian and European Com- as well as spheres of regulations within the com- missions. The prerequisites for such a dialogue have petence of the EEC currently and in the mid-term, been created. the heads of the EAEU Member States changed the number of the Board members. Now, the EAEU In contrast to the global downturn, the consistent Member States are represented by ten Members of and successful transformation of the Eurasian space, the Board – Ministers, including the Chairman – two based on the market economic principles with pres- Ministers from each Member State. ervation of political independence and the existing cultural identity of the sovereign states, still continues. In 2016, the main stage of development of the The global Eurasian integration book is being filled with common markets of medicines and medical prod- new chapters. ucts was completed. A comprehensive system for regulating the circulation of medicines and medical products was prepared, which, for the first time in 2017 the Member States of the Union, has provided for an almost complete regulation of the “life cycle” of In May 2017, the common markets of medicines and products, namely, their development, production medical products began to operate in the EAEU. and use. The launch of these markets will increase the avail- Over the last four years, with 2015 being the year ability of effective and high-quality medicines and of particular activity, due to acquisition by the medical products for citizens of the Union, as well as Union of the international legal personality after create optimal conditions for increasing the com- signing the Treaty on the EAEU, the EAEU Mem- petitiveness of products of the pharmaceutical and ber States together with the Commission have medical industry of the EAEU countries on the world strengthened the impact of the Union on external market. directions. Its prestige and importance in the inter- national arena have increased significantly. This is On April 11, 2017, the Presidents of the countries of confirmed not only by the expansion of the Eur- the Union signed the Treaty on the Customs Code of asian Economic Union after the accession of the the Eurasian Economic Union. The Customs Code Republic of Armenia and the Kyrgyz Republic, but of the EAEU is a modern instrument of customs also by the growing interest in close cooperation regulation that meets the challenges of today. with the EAEU shown by many countries around Compared with the Customs Code of the Customs the world: China, Vietnam, Iran, India, Israel, Union effective from 2010, the new document Egypt, Singapore, MERCOSUR and ASEAN, and provides for a number of significant innovations others. An important element of the strategy of aimed at improving customs regulation and ensuring a balance of interests between state bodies and the business community.

The new Customs Code will come into force on January 1, 2018, after the completion by all the EAEU Member States of necessary internal procedures.

In April 2017, liberalization plans entered into force, according to which from 2019 to 2021 20 service sectors will be transferred to the format of a common market of services, including: especially dangerous construction works, tourism, evaluation, mine survey- ing, scientific research.

Supreme Eurasian Economic Council

9 Eurasian Economic Integration: Facts and Figures

Timeline of Events

1994 2007

Lecture of the President of Kazakhstan The Treaty on the Commission of the Nursultan Nazarbayev in Moscow State Customs Union University

The Treaty on Creation of the Common 1995 Customs Territory and Establishment of the Customs Union The Agreement on the Customs Union

The Agreement on the Customs Union 2009

Treaty on the Customs Code of the Customs Union 1996

The Treaty on Deepening of Integration in Economic and Humanitarian Areas 2010

Creation of the Customs Union 1999

The Treaty on the Customs Union and the Unification of the customs territories of the Common Economic Space three countries into the common customs territory on the basis of the common Customs Code 2000 The Treaty on Establishment of the Eurasian 2011 Economic Community (EurAsEC) The Treaty on the Eurasian Economic Commission 2003–2006

The Agreement on Formation of the Common Declaration on Eurasian Economic Economic Space Integration

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The decision of the Supreme Eurasian 29.05.2014 Economic Council On the entry into force of international treaties forming Signing the Treaty on the Eurasian the Common Economic Space Economic Union

01.01.2012 01.01.2015

Treaty on the Eurasian Economic The Treaty on the Eurasian Economic Union coming into force Commission

Commencement of the Common Economic Space 02.01.2015

Accession of Armenia to the Eurasian Economic Union 02.02.2012

The Eurasian Economic Commission’s commencement of operation 12.08.2015

Accession of Kyrgyzstan to the Eurasian Economic Union 2012–2014

The work of the EEC and authorised authorities of the Republic of Belarus, the Russian Federation, the Republic of Kazakhstan on the preparation of the 01.02.2016 Treaty on the Eurasian Economic Union Beginning of work of the new members of the Board of the Eurasian Economic Commission Memorandum on deepening of cooperation between the Eurasian Economic Commission and Kyrgyzstan 2017 The Heads of the states of the “Customs Three” and Armenia adopted Treaty on the Customs Code of the the Application “On accession of the Eurasian Economic Union Republic of Armenia to the Eurasian integration process” The «White Paper» of Barriers, Exemptions and Restrictions

11 Eurasian Economic Integration: Facts and Figures

The Member States of the Eurasian Economic Union. Position in the world

Territory and population

The Russian More than Federation 182.7 mln people

More than

The Republic 20 The Republic of Kazakhstan mln sq.km of Belarus

14% The Kyrgyz The Republic Republic of the world dry of Armenia land

General economic indicators in 2016, USD bln 1,485.4* 509.7 42.5 859.0* volume of foreign volume of mutual trade industrial production gross domestic trade with third between the EAEU product of the EAEU countries Member States

* The data is represented based on the current prices.

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World ranking of individual economic Agricultural production. EAEU share indicators of the Member States of the in the world production, % Eurasian Economic Union in 2016 (%)

Exatraction. The EAEU share in the world 27.6 production 26.5 19.3 21.8

14.5 17.5 14.3 11.3 10.5 6.5 5

1st 2nd 4th 6th place place place place 1st place Crude oil (including gas Electricity condensate) output Sugar beet Natural gas Coal Rye Production. The EAEU share in the world production Oat

22.6 Barley

2nd place

Sunflower (for grain)

4.8 4.8 3rd place

1st 4th 5th Potatoes place place place Wheat Potash fertilizers Cast iron

Steel

The EAEU share in the world road length

7.8

2.6

3rd 5th place place

Total rail mileage Total stretch of road

13 Eurasian Economic Integration: Facts and Figures

Results of the mutual trade of goods in the Eurasian Economic Union Member States in 2015 and 2016

The volumes of the mutual trade between the EAEU Member States in H1 2015 and 2016

2015, 2016, 2016 Share in volume USD mln USD mln in % to 2015 for 2016, %

EAEU 45,605.3 42,536.4 93.3 100.00

including:

Armenia – Belarus 34.6 36.1 104.3 0.08

Armenia – Kazakhstan 4.8 6.3 127.6 0.02

Armenia – Kyrgyzstan 0.6 1.0 192.9 0.00

Armenia – Russia 1,295.8 1,328.2 102.5 3.12

Belarus – Kazakhstan 578.6 395.6 68.4 0.93

Belarus – Kyrgyzstan 61.0 52.0 85.2 0.12

Belarus – Russia 26,003.3 25,965.0 99.9 61.05

Kazakhstan – Kyrgyzstan 752.7 651.2 86.5 1.53

Kazakhstan – Russia 15,413.6 12,936.1 83.9 30.41

Kyrgyzstan – Russia 1,460.3 1,164.9 79.8 2.74

* Total monetary volume of the export transactions of the Member States in mutual trade.

In comparison to the same period of 2015, the share to 52.2%, 3) in the Republic of Kazakhstan the indi- of mutual trade in the overall foreign trade within the cator has slightly changed from 21.3% to 21.9%, 4) EAEU increased from 13.6% to 14.2%. 1) In the Re- in the Russian Federation – from 8.2% to 8.7%. public of Armenia, this indicator has risen from 26.5% The share of mutual trade in the total foreign trade for to 29.2%, 2) in the Republic of Belarus – from 49.5% the Kyrgyz Republic decreased from 43.5% to 35.9%.

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THE STRUCTURE OF MUTUAL TRADE BY COMMODITY AGGREGATES FOR 2015 AND 2016 OF TOTAL, %

2015 2016 Mineral Chemicals commodities

2.5 2.8 3.4 6.3 4.2 8.6 11.7 Machinery, Fabrics, 12.4 equipment textile goods and vehicles and footwear 10.7 11.3 27.1 33.3

15.5 16.1 Food products Wood materials and agricultural and pulp and stock paper goods 16.6 17.5

Metals Other goods and metal goods

The volume of export supplies in bilateral trade of the Member States of the EAEU

2015 2016 2016 in % Share in volume USD mln USD mln to 2015 for 2016, %

EAEU 45,605.3 42,536.4 93.3 100.0

including:

Armenia 256.2 392.1 153.0 0.9

Belarus 11,007.8 11,255.1 102.2 26.5

Kazakhstan 5,120.3 3,917.6 76.5 9.2

Kyrgyzstan 399.8 417.5 104.4 1.0

Russia 28,821.2 26,554.1 92.1 62.4

15 Eurasian Economic Integration: Facts and Figures

Results of the foreign trade in goods produced in the EAEU Member States in 2016

Volumes of foreign trade in goods of the EAEU Member States with third countries for 2016, USD mln

Export Import Balance In % to H1 2015

export import

EAEU 308,444.9 201,344.6 107,100.3 85.5 98.0

including:

Armenia 1,390.8 2,169.7 –778.9 113.3 97.8

Belarus 12,162.5 12,205.9 –43.4 77.7 93.3

Kazakhstan 32,858.0 15,508.9 17,349.1 80.5 80.1

Kyrgyzstan 1,126.0 2,374.4 –1,248.4 105.2 115.3

Russia 260,907.6 169,085.7 91,821.9 82.8 100.2

Contributions of the EAEU Member States in the aggregate indicators of foreign trade (as a percentage of the total for the EAEU), %

TurnoverTurnover ExportExport ImportImport Turnover Export Import

0.70.7 0.40.4 0.7 0.4 1.21.2 1.2 9.59.5 10.710.7 7.77.7 9.5 10.7 7.7 4.84.8 3.93.9 6.06.0 4.8 3.9 6.0 0.70.7 0.40.4 84.384.3 84.684.6 84.084.0 0.7 0.4 1.11.1 84.3 84.6 84.0 1.1

ArmeniaArmenia BelarusBelarus KazakhstanKazakhstan KyrgyzstanKyrgyzstan RussiaRussia Armenia Belarus Kazakhstan Kyrgyzstan Russia

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Commodity Composition of Structure of export and import of goods in foreign trade exports and imports for of 2016 (as percentage of total), % Export Import In the commodity composition of exports of the EAEU Member 5.5 States to third countries, mineral 9.0 products (60.6% of the total 4.2 43.3 exports of countries of the Union 10.5 Member States to third countries), 9.2 0.3 6.4 metals and metal products 10.5%, 3.2 6.3 chemical products 6.7% dominate. 6.7 60.6 1.8 13.2 The biggest share in imports is 18.5 1.3 taken by machines, equipment and Food products Fabrics, textile goods vehicles (43.3% of total imports), and agricultural stock and footwear chemical products (18.5%), food products and agricultural raw Mineral commodities Metals and metal goods materials (13.2%).

Chemicals Machinery, equipment The main share of exports of the and vehicles Member States (84.7%) falls on intermediate goods, including Wood materials Other goods energy products with 58.9%, other and pulp and paper goods intermediate goods with 25.8%.

In imports of the Member States Import purchases are concentrated the European Union countries, intermediate goods (41.6% of in the APEC countries (42.3% significant are supplies from total imports) and consumption of total imports of goods) and Germany (11.2%), France and goods (32.4%) prevail. The share of the countries of the European Italy (4.7% from each). In the CIS investment goods is 22.3%. Union (40.8%). Among the APEC countries, 4.3% of goods were countries, the largest volumes purchased, including the Ukraine – Geographical distribution of account for China (22.7%), the 2.7%. The share of Turkey accounts foreign trade United States (6.4%), Japan (3.7%), for 1.9% of total imports of the EAEU South Korea (2.8%). Among Member States. The main buyer of goods exported by the EAEU Member States is the European Union (50.3% of total Foreign trade of the EAEU by countries – major trade exports). partners, USD bln

Among the countries of the (Next to the name of the country, its share in the total foreign trade is indicated) European Union significant are supplies of goods to the CHINA, 15.4% 32.9 45.7 Netherlands (10.9%), Germany GERMANY, 8.8% 22.6 22.5 (7.3%), Italy (6.3%), and Poland NETHERLANDS, 7.3% 33.5 3.5 (3.4%). ITALY, 5.7% 19.5 9.4 THE USA, 4.5% 10.1 12.9 24.2% of exports are sold to the TURKEY, 3.6% 14.7 3.9 APEC countries, including China – JAPAN, 3.4% 10.0 7.4 10.7%, South Korea and the United FRANCE, 3.2% 6.6 States – 3.3% to each, Japan – 9.5 THE REPUBLIC OF KOREA, 3.1% 3.2%. The CIS countries bought 10.3 5.7 5.8% of the goods exported, of POLAND, 3.1% 10.4 5.4 Export UKRAINE, 3.1% 10.1 5.5 which the Ukraine – 3.3%. Exports Import to Turkey accounted for 4.8% of total GREAT BRITAIN , 2.5% 8.9 4.0 exports of the EAU Member States. FINLAND, 1.9% 6.8 2.7

45 40 35 30 25 20 15 10 5 0 5 10 15 20 25 30 35 40 45 50 17 Eurasian Economic Integration: Facts and Figures

Statistical information on the results of external and mutual trade in goods of the EAEU Member States

Total volume of foreign trade in goods of the Member States of the Customs Union and the Common Economic Space with third countries amounted to USD 907.2 bln, including exports – USD 581.4 bln, imports – USD 325.8 bln. 2011 Volume of mutual trade in goods (amount of the cost volumes of export operations of the Member States of the Customs Union and the Common Economic Space in mutual trade) amounted to USD 63.1 bln.

Total volume of foreign trade in goods of the Member States of the Customs Union and the Common Economic Space with third countries amounted to USD 934.6 bln, including 2012 exports – USD 593.7 bln, imports – USD 340.9 bln. Volume of mutual trade in goods of the Member States of the Customs Union and the Common Economic Space amounted to USD 67.8 bln.

Total volume of foreign trade in goods of the Member States of the Customs Union and the Common Economic Space with third countries amounted to USD 933.0 bln, including 2013 exports – USD 587.7 bln, imports – USD 345.3 bln. Volume of mutual trade in goods of the Member States of the Customs Union and the Common Economic Space amounted to USD 64.5 bln.

Total volume of foreign trade in goods of the Member States of the Eurasian Economic Union with third countries amounted to USD 868.7 bln, including exports – 2014 USD 556.8 bln, imports – USD 311.9 bln. Volume of mutual trade in goods of the Member States of the Eurasian Economic Union amounted to USD 58.5 bln.

Total volume of foreign trade in goods of the Member States of the Eurasian Economic Union with third countries amounted to USD 579.3 bln, including exports – 2015 USD 373.8 bln, imports – USD 205.5 bln. Volume of mutual trade in goods of the Member States of the Eurasian Economic Union amounted to USD 45.6 bln.

Total volume of foreign trade in goods of the Member States of the Eurasian Economic Union with third countries amounted to USD 509.7 bln, including exports – 2016 USD 308.4 bln, imports – USD 201.3 bln. Volume of mutual trade in goods of the Member States of the Eurasian Economic Union amounted to USD 42.5 bln.

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Industrial Production Unemployment level, % In 2016, compared to 2015, the industrial production 9.6 9.6 index of the Eurasian Economic Union amounted to 101.1% (in 2015 compared to 2014 – 98.9%). 8.5 7.3

In the structure of industrial production of the EAEU, 5.7 in 2016, the largest share was held by industry (66.1%). 4.9 The share of mining and quarrying amounted to 23.7% (decreased by 0.1 percentage point).

Agriculture EAEU EU USA In 2016, in the farms of all categories of the Member States of the Eurasian Economic Union, agricultural 2010 2016 production increased at constant prices by 4.5% compared to 2015 (in 2015 vs 2014 – by 2.6%).

The largest increase was reported in Kazakhstan – 5%, in Russia it was 4.8%, in Belarus – 3%, in Kyrgyzstan – 3%. The average monthly nominal salary In 2016, production of major livestock products also in the EAEU Member States (USD)* increased. Production of livestock and poultry (live weight) increased by 3% and amounted to 12.4 million tons, milk – by 0.5% (45.5 million tons), eggs – by 1.7% 2010 2016 (53.1 billion pieces).

Armenia** 274.7 393.0*** Social Indicators of the Member States of the Eurasian Economic Union Belarus 406.6 361.4 The unemployment rate within the Union as of the end of 2016 was 5.7%, which is better than the EU indicator Kazakhstan 526.7 417.6 (8.5%) and above of the US indicator (4.9%). Kyrgyzstan 156.4 207.3*** There has been a trend of leveling the level of economic development among the Member States of the Union, Russia 690.1 525.6*** despite the differences in the size of the economy and the global crisis. The gap in GDP per capita decreased from 9.8 thousand US Dollars in 2010 to 7.7 thousand US Dollars in 2016. The gap between the Member States in the level of wages, productivity, number of * The indicator is calculated at exchange rates of national (Central) banks of the EAEU Member States for the year: for Belarus – at weighted average rate security researchers, indicators of unemployment has of Belarusian ruble to US Dollar; for Armenia, Kazakhstan, Kyrgyzstan and also decreased. Russia – at average rates of the national currencies to US Dollar.

** Since 2013, payment for labour and other payments equal to it include the employer’s payments for compulsory social insurance, as well as salaries of military personnel.

*** Preliminary data

19 Eurasian Economic Integration: Facts and Figures

From the Customs Union to the Eurasian Union

20 1H 2017 Eurasian Economic Commission

What does the Customs Union stand for?

The Customs Union (CU) is • change the rates of import of the end of June 2017, 6 primarily common market of customs duties; antidumping investigations are goods with an application being carried out, of which 4 are • maintain the Commodity of the norms of the common reinvestigations. Nomenclature of Foreign Customs Code, a Single Economic Activity of the Customs Tariff, a system of On July 6, 2010, the Customs Customs Union; safeguard measures for the Code of the Customs Union internal market, a unified • set the tariff preferences and tariff came into effect. A common system of foreign trade and quotas; regulation system in this area customs regulation, as well was launched in three countries. • determine the tariff preferences as a single legal framework in structure; Normative documents on technical regulation. Customs customs administration, including duties and restrictions of • introduce non-tariff regulatory common rules for the declaration economic nature are not measures. of goods, payment of customs applied on its territory. duties and single customs From July 1, 2010, the procedures have been adopted. The Customs Union provided Commission was empowered Common rules for determining freedom of movement of goods. to conduct investigations and the customs value and the origin Therefore, at this stage, the key other procedural actions prior of goods have been applied. trends in integration work are the to the introduction of safeguard, A system of information and customs cooperation, trade and anti-dumping and compensatory analytical support of the customs technical regulation. The main task measures in the common tariff and non-tariff regulation to be resolved by the states was customs territory of the Customs processes has been created. the development of a common Union in respect of goods Due to the above measures, the legal framework in the key areas originating from foreign countries. number of documents required of work and creation of conditions for registration of customs for the start of the harmonization Thus, from 2011 till now, the declarations has been significantly of national laws of the Member Commission has conducted reduced. Common rules for States in other areas of activities and completed 31 investigations declaration of goods in the brought from the national to the (7 of them are reinvestigations). Customs Union were formulated supranational level. Following their outcomes, the EEC for business. The process of introduced 7 special protective customs clearance has become By January 1, 2010, legal measures – to restrict serious more transparent, consistent and conditions necessary for the damage caused by a sharp convenient for the participants of union to start operating were increase in imports to the Union foreign economic activity. created, when the competence of territory, and 20 antidumping the foreign trade regulation was measures to compensate the In order to improve the efficiency of handed over to the Customs Union damage caused to industry customs authorities, the information Commission1. sectors by unfair competition and reference list of checkpoints from foreign suppliers. As across the external border of the Since that moment and pursuant to the international treaties the Commission has been 1 From February 2, 2012 the Eurasian Economic Commission operates instead authorized to: of the CU Commission.

21 Eurasian Economic Integration: Facts and Figures

Customs Union has been adopted. From July 1, 2011, the customs Activities in the sphere of the In addition, implementation of control at the internal borders technical regulation, sanitary, compulsory preliminary information between Belarus, Kazakhstan and phytosanitary, veterinary of the goods imported into the Russia has been fully removed. All measures, consumer rights Customs Union by road and rail types of control and registration protection including those aimed has been provided. The work on were transferred to the external to design and adopt the technical preparation of a similar decision for border of the Customs Union. The regulations of the Customs Union the goods transported by air has introduction of the single customs and the interstate standards been conducted. territory was completed. Goods also were the most crucial focus and vehicles of the Customs area of the Union states at this At this stage of integration, Union and third states after their stage. In fact, it is a key element maintaining of the customs release for local use within the in formation of a common market statistics of foreign and mutual territory of any Member State with no technical barriers, with trade of the Member States began to freely move within the unified requirements to safety of has been arranged. A single single customs territory. the goods and with a unified base statistical portal on ten signs of of standards. A modern regulatory the Commodity Nomenclature of framework in the sphere of the Foreign Economic Activity has The paid duties were distributed technical regulation contributes to been created. This allowed to fully into the state budgets of the triad in improving the competitiveness of understand the structure of export- compliance with following agreed the products manufactured in the import operations. As a result, the breakdown: Union and on the world market. business of the Union countries was able to quickly track actions Belarus The Eurasian Economic of unfair foreign competitors, Commission that started to providing strong arguments to operate on February 2, 2012 was

the Commission for relevant 4.7% granted all the powers necessary investigations. in the filed of the technical regulation, sanitary, phytosanitary In mutual trade in the Customs Kazakhstan and veterinary measures. By the Union, the procedure of levying end of 2012, the integration unit indirect taxes was used. Practice 7.33% adopted 24 common technical for electronic data exchange on regulations. the amounts of indirect taxes paid between tax authorities of the three Russia At the stage of the Customs states was formed. Union, the legal foundations for successful development Agreement on Establishment and 87.97% of other areas of activities Application in the Customs Union of were laid. It gave the pos- the Procedure for Transferring and sibility to smoothly move to Distributing Import Customs Duties By the end of 2011, the next stage of integra- (other Duties, Taxes and Fees contractual and legal tion – the Common Econom- Having Equivalent Effect) came into framework of the Customs ic Space. force. Under the Agreement, import Union has been formed. At customs duties paid in the territory this stage, it included more of a Member State should be than 70 international treaties distributed between the budgets of and over 900 decisions of the the Union countries under specified Commission of the Customs standards. Union.

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What does the Common Economic Space stand for?

The Common Economic On December 19, 2010, by the of services, capital and labour Space (CES) is an integration decision of the supreme body of was expanded. stage that provides for free- the Customs Union, an Action dom of movement of goods, Plan for the introduction of the Systematic work to identify and services, capital and labour. Common Economic Space of eliminate exemptions from the free Therefore, creation of condi- Belarus, Kazakhstan and Russia trade regime was carried out. This tions favourable for the prin- was adopted. According to the work was launched by the Eurasian ciple of free movement of said Action Plan, a number of Economic Commission in 2013 on services, capital and labour relevant international treaties behalf of the Heads of the Member and also elimination of the were signed by the Heads of States of the Customs Union and rest of exemptions prevent- the Member States. A year the Common Economic Space. ing free movement of goods later, on January 1, 2012, by the were determined to be the decision of the Supreme Eurasian Consistent and comprehensive main goals of economic in- Economic Council, 17 basic work was conducted in the sphere tegration at the stage of CES international treaties forming the of technical regulation, sanitary, construction. Common Economic Space were veterinary and phytosanitary put into effect. In 2013, another measures, as well as in the treaty was signed. development and adoption of technical regulations and interstate In order to implement the During the formation of the CES standards. Active development of integration processes envisaged the work in the field of customs, technical regulations governing in the near future, an important trade and technical regulations product safety of the Union area of work at the stage of that prevailed at the stage of the countries and its processes related the Common Economic Space CES formation was continued. thereto continued. An increasing introduction was codification of The area of cooperation between number of goods circulating in the international treaties forming the the member states of the Customs Union and the Common Customs Union and the Common integration project on ensuring Economic Space became safer, Economic Space. This included, full-fledged freedom of movement their quality improving. in particular, preparation for the signing by the Presidents of the Member States of the draft Treaty on the Eurasian Economic Union.

The CES has been formed gradually, by increasing the level of integration, through synchronization of economic transition made by the Member States, cooperative efforts in conducting an agreed economic policy, harmonization and unification of legislation in economy, trade and other areas. The work was conducted with respect to the generally recognized norms and principles of international law, as well as the expertise of the world’s best legal practices.

23 Eurasian Economic Integration: Facts and Figures

efficiency and reliability of the energy complex, to optimize the use of primary energy resources and to increase non-resource export potential.

A similar job was done in the sphere of industrial policy, i.e. in May 2013 the Supreme Eurasian Economic Council at the prime- minister level adopted the Decision “On main directions to coordinate the national industrial policies of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation”. This document established a concept of the industrial policy within the CES, defined the main areas of industrial cooperation between the Member States as well as the tracks on cooperation with the Business Dialogue of Belarus, Kazakhstan, Development of coordinated and financial system. Work in both Russia and the representatives of policies in the most important of these areas includes directions the business communities of the economic sectors was launched. that unfold the potential of the parties. It was also defined a list macro-economic, transport, Eurasian economic integration, of priority economy sectors for an energy, agriculture, foreign the best practices applied in the industrial cooperation within the CU exchange and migration policies, Member States of the CU and CES, and CES. as well as policies in the spheres and also the cutting edge global of economics, such as financial experiences in these fields. The key provisions of the decision markets, intellectual property. were further elaborated and Forming of a coordinated (agreed) developed in the Main Directions The leaders of Belarus, Kazakhstan transport policy of the CU and CES of Industrial Cooperation approved and Russia approved the first has been started. Its realization will by the Intergovernmental Council, programme document in the field contribute the development of a which defined the strategy and of macroeconomic policy – Main complex for transport and logistic principles for the development of Guidelines of Macroeconomic as well as creation of common industrial cooperation within the Policy of the Member States of the markets for transport services and EAEU for the mid-term. Customs Union and the Common a single transport space. Economic Space for 2013–2014. We expect to see the following The document was prepared The Concept and the Programm results of the agreed (coordinated) based on the analysis of the social on forming common gas, oil policy on agriculture: creation of and economic development of and oil products markets were transparent conditions for bilateral these states, their main external approved. The Agreement on the trade, increase of self-sufficiency of risks and internal confinements Methodology of forming indicative the common agricultural product in order to ensure sustainable (forecast) balances of gas, oil and food market based on the economic growth. It identified key and oil products within the EAEU coordinated development of its targets of macroeconomic policy came into force. Conducting a national segments, as well as of the Member States in the short coordinated (agreed) energy policy strengthening export potential of term. These included support of will ensure a steady growth of the agroindustrial complex. the macro economic resilience, national economies and energy creation of conditions for consistent security of the states, protect Supra-national coordination economic growth by a deeper the interests of consumers and conducted by the Commission cooperation in the real economy producers of energy resources. It on the basis of interaction with sectors and evolution of the credit also aims to increase the economic the authorized authorities of the

24 1H 2017 Eurasian Economic Commission

member states of the CU and services in banking, insurance CU and the CES, which entered the CES contributed at this stage and securities market. The work into force after ratification of the to stimulation of the agricultural on liberalization of relations in the Agreement “On the Procedure product markets development. It framework of the Eurasian project for Confidential Information was a question of maintaining a in the sphere of investment and Protection and Liability for its level playing field in production of on creation of a common market Disclosure in the implementation and trade in agro-food products, in of services was conducted. by the Eurasian Economic the use of resources of agricultural For the purposes of, among Commission of the authority to production to improve the income other things, achieving the free monitor compliance with common of producers, the availability of food circulation of services, capital competition rules” in May 2015. for consumers. and labour a number of basic agreements in the sphere of The work on deepening The Eurasian Economic intellectual property and labour integration between the Commission in a close dialogue migration was developed. At participants of the Eurasian with the business representatives this stage of integration, in economic project made at the and the expert community accordance with the decision of stage of introduction of the of the integration association the Supreme Eurasian Economic Common Economic Space member states was working on Council of December 24, 2013, allowed the Member States of development of entrepreneurship the Commission was empowered the Customs Union and the in the Union countries and to monitor compliance with Common Economic Space to creation of a fully-featured common competition rules in the create conditions to establish domestic market of financial transboundary markets of the the Eurasian Economic Union.

What does the Eurasian Economic Union stand for?

The Eurasian Economic Union updated, gaps were filled, and a of movement of goods, services, (EAEU) is an international single conceptual framework was capital and labour. Provisions organization of regional formed. The Treaty included rules of the contractual and legal economic integration, under and regulations of the EurAsEC framework of the CU and the CES which freedom of movement that meet the goals and objectives were brought into conformity with of goods, services, capital of the Union to ensure freedom the WTO rules and regulations. and labour is provided for.

The Treaty on the Eurasian Economic Union was signed on May 29, 2014 at a session of the Supreme Eurasian Economic Council in Astana and entered into force on January 1, 2015. The Treaty on the Union is a legal and regulatory basis for the functioning of the EAEU. This is a single core document developed by taking into account the best international practices.

In developing the Treaty on the EAEU, the work on systematization of international treaties concluded within the framework of the CU and SES was conducted: contradictions were excluded, existing rules were optimized and

25 Eurasian Economic Integration: Facts and Figures

The Treaty contributes to free Economic Union is becoming a institutional measures to improve movement of goods, services, significant element of the global the business climate, it is extremely capital and labour, a coordinated, economic architecture. The important for the new internal agreed or common policy in the Treaty stipulates that the Union procedure of assessing the economic sectors stipulated in the has the right to perform, within regulatory impact of draft decisions Treaty and international agreements its jurisdiction, international by the Eurasian Economic within the Union. activities aimed at addressing Commission that might affect the the challenges faced by the environment of entrepreneurial The Eurasian Economic Union Union. The Union can cooperate activity to be fixed in the Treaty on was founded on the principles of with states, international the EAEU. international law which, among organisations and international others, include a principle of integration associations. Jointly The Principle of four “freedoms” sovereign equality of the member with the Member States, the as a fundamental principle of states, respect to the specifics of Union can also conclude the Union’s operation enshrined the political set-up of the members international treaties with the the refusal to apply safeguard to the association, ensuring the above organisations on any measures for domestic market in mutual benefit in the cooperation, matters within its jurisdiction. mutual trade. Completion of the observing the market economy formation of the single goods, principles and its functioning (as Rules on the correlation of the services, capital and labour market a rule) without exemptions and Treaty on the EAEU with other is the purpose of the Eurasian restrictions. international agreements of the integration at this stage, which Member States, on its registration is characterized by a deeper The Union is an international in the UN Secretariat, provisions integration as compared to the organisation of regional on the accession to the Treaty Customs Union and the Common economic integration and has and withdrawal from it, as well as Economic Space. international legal personality. provisions on observers at the Previously, the Customs Union Union were adopted. The Union countries defined and the Common Economic the directions of deepening the Space functioned within the From the point of increasing the integration. For example, under institutional framework of the level of transparency, balance the provisions of the Treaty on Eurasian Economic Community and quality of the supranational the EAEU, 81 obstacles have (EurAsEC) only. Thus, the Eurasian regulation and developing the been eliminated from January

26 1H 2017 Eurasian Economic Commission

1, 2015. Continuing its work in Republic of Armenia – The Treaty established general this direction, the Commission provisions for conducting technical published in March 2017 the regulation in the EAEU. Thus, White Paper, a report that 1.220% one of its main principles is the reflects the results of the EEC Republic of Belarus – establishment of unified binding work aimed at removing barriers, requirements for products and exceptions and restrictions for related processes (from design the implementation of the four 4.560% and production to disposal). Such “freedoms” in the internal market requirements are established in of the Union. Methodological Kazakhstan – the technical regulations of the approaches to the classification of Union. By July 2017, the list of obstacles are indicated, specific 7.055% adopted technical regulations of the examples of their elimination Eurasian Economic Union included are described, and priorities for Kyrgyz Republic – 44 documents, 35 of which entered further activities in this direction into force. The number of standards are outlined. contained in the lists to the

1.900% technical regulations of the EAEU The Treaty on the EAEU defines exceeded 11,000. the legal basis of a single Russian Federation – market of services. A common The Treaty defined development market condition predisposes a of common markets of medicines non-application of restrictions 85.265% and medical products in the measures and a national regime EAEU space. The documents to services, as well as preferential The leaders of the Union necessary for launching their treatment towards enterpreneurs countries agreed to conduct a operation were completed in from the other member states. coordinated policy in the field of 2016. They are based on a set There is also automatic energy and to establish common of important principles, including recognition of authorization markets for electric power, gas, harmonization and unification documents and cualification oil and oil products. The Treaty of the requirements of national requirements of entities’stuff. on the EAEU provides for this legislation, ensuring the unity of In addition to it, services are task to be implemented in several mandatory quality requirements, provided within the territory of stages and finally performed by efficiency and safety of medicines the Union without an additional 2025: establishment of a common and medical products, adoption of establishement of legal entity. energy market of the Union and common rules for their circulation, ensuring access to services of etc. The main mechanisms From January 1, 2017, import natural monopoly entities in the of the common markets were customs duties are distributed electricity sector is expected to launched in May 2017, which between the budgets of the EAEU be completed by 2019, common became a socially significant Member States under the following gas, oil and oil product markets – event and allowed eliminating standards: by 2025. unnecessary administrative

27 Eurasian Economic Integration: Facts and Figures

nated (agreed) transport policy of the Memeber States of the EAEU to maintain economic integration, stepwise formation of the common market for transportation services and the single transport space on the principles of competition, transparency, safety, reliability, accessability and ecology.

In December 2016, the Heads of the Union States approved a strategical document – the Main directions and steps of the coordi- nated (agreed) transport policy. Its implementation will help to cancel limits for any transportaton in the EAEU until 2025.

An agreement was reached on formation and implementation by barriers to free movement of and public authorities together the Member States under the co- quality and affordable medicines with the business community of ordination of the EEC of an agreed and medical products in the Union. the Union countries. The EAEU agroindustrial policy. Forecasting Common markets operate on CC is one of the key documents in the agroindustrial complex, state the basis of the decisions of the constituting the regulatory legal support for agriculture, regulation Commission that establish, among framework of the Union. The of the common agricultural market, other things, common rules for Treaty on the Union stipulates uniform requirements for product registration, research, and other that the association should have manufacture and circulation, de- rules and requirements governing unified customs regulation under velopment of agricultural products individual stages of circulation of the EAEU CC and international and food exports, scientific and medicines and medical products. treaties covering the scope of the innovative development of the In May 2017, the Commission customs regulation. agroindustrial complex, as well as Council approved a list of the integrated information support for “third level” regulations on the The new Customs Code is focused agroindustrial complex are main common markets of medicines on paperless workflow and the use directions of the agreed agroindus- and medical products within the of modern software and hardware trial policy. Union, which provides for approval at all stages – from filing a decla- by the Commission of another 25 ration to the release of goods. This It is important that the implemen- documents in 2017–2019. will significantly save the resourc- tation of policies in other areas of es of the business community, integration cooperation, including The EAEU Customs Code accelerate the process of customs sanitary, phytosanitary and vet- is a unified set of rules clearance and minimize the con- erinary and sanitary measures in for execution of foreign tact of foreign trade operators with respect of agricultural products, be economic activity in the officials. carried out taking into account the Union, a progressive objectives, tasks and directions of document promoting The Treaty on the Customs Code the agreed agroindustrial policy. It is simplification of customs of the EAEU was signed on April aimed at ensuring the development formalities and, as a 11, 2017, and currently internal of the agroindustrial complex and consequence, improvement procedures are being implemented rural areas in the interests of citi- of the business climate. in the countries of the Union. The zens of each Member State and the Code should come into force on Union as a whole, as well as eco- In 2016, a large-scale work on January 1, 2018. nomic integration within the EAEU. the draft Customs Code of the EAEU was completed, which was The Treaty on the EAEU defines In accordance with the Treaty on conducted by the Commission main priorities and tasks of coordi- the EAEU, this activity involves

28 1H 2017 Eurasian Economic Commission

development of measures planned a creation of supranational data from the Member States, as and mechanisms of interstate instrument in 2025. The Member well as elaboration in cooperation cooperation to deepen integration States shall determine its powers with their authorised authorities processes and the sustainable and functions after the termination and adoption of the integration development of agroindustrial of the gradual harmonization of development program in statistics complex. legislation. sector.

With regard to industrial policy, the The effective functioning of the The Treaty brings the countries of Treaty substantially expands the EAEU is impossible to imagine the Union to a qualitatively new contractual and legal framework of without conducting the coordinat- level of cooperation in the field the CU and the CES, which earlier ed macroeconomic policy, which of labour migration. In order to only regulated issues of providing provides for the development and expand the possibilities for em- industrial subsidies. Goals, objec- implementation of joint actions ployment, citizens of the Member tives, principles and mechanisms of the EAEU Member States in States have an opportunity to work of industrial cooperation in the order to achieve balanced eco- not only under an employment Union have been defined. It is also nomic development. The Treaty contract, but also under a civil law provided that when developing on the EAEU stipulates that the contract. In addition, no restric- and implementing policies in trade, main directions of the coordinated tions established by the legislation customs and tariff regulation, macroeconomic policy include of the Member States in order to competition, technical regulation, formation of the common princi- protect the national labour market business development, transpor- ples of functioning of the economy are applied. tation and infrastructure, in state of the Member States, providing procurement and other areas, the their effective cooperation, de- The issues of direct recognition interests of industrial development velopment of common principles of education and qualification of the Member States shall be and guidelines for the prediction of certificates without any additional taken into account. socio-economic development of procedures and the procedure for the parties. recognition of academic degrees In accordance with the Main and ranks have been formalized. Directions of Industrial Cooper- The Treaty enshrines the principles ation within the EAEU adopted for formation and communication Currently the Commission in by the Heads of Governments, of official statistical information of cooperation with the competent the industrial policy implemented the Union. In addition, the Treaty authorities of the Member States in the Union is focused on joint provides for vesting the Commis- is actively working on a Contract development by the Member sion with the powers, such as on Pension Provision of Workers States of new types of export-ori- development and approval of the of the Member States. After its ented products, including by methodology for compiling offi- signing, the Union citizens will deepening cooperation, increas- cial statistical information of the be able to receive pensions for ing localization of production and Union on the basis of the official the period of their employment promoting import substitution; creation of new production chains and innovative industrial sectors; production modernization in traditional industries; building-up jointly manufactured high-tech products export. For these pur- poses, the Treaty provides for and has already implemented tools and mechanisms, such as the Eurasian technology platforms, the Eurasian Subcontracting Net- work and the Eurasian Technology Transfer Network.

To maintain regulation and devel- opment of the common financial market of the Union, it has been

29 Eurasian Economic Integration: Facts and Figures

the same legal protection in all EAEU countries.

Apart from the content of industry, in the development of the Treaty on the EAEU the tasks of creating the institutional framework of the Eurasian Economic Union were present. The Treaty lays down the structure of permanent bodies of the Union. The Union manage- ment bodies system is based on a collective form of decision-mak- ing. The main body of the Union is the Supreme Eurasian Eco- nomic Council (SEEC), which is composed of the Heads of the Member States. SEEC sessions from the Member State, where unfair price competition in mutual are held at least once a year. The they worked. All the pension rights trade in goods and services. Supreme Council determines the acquired in the Union Member strategy, directions and prospects States shall be considered in as- As regards the government (mu- for the formation and develop- signing and paying the pension. nicipal) procurement, the Treaty, ment of the Union and makes maintaining the provisions of the decisions aimed at implementing The rule for provision of full scope contractual and legal framework its objectives. At least twice a year of social insurance for employees of the CU and the CES on equal the Eurasian Intergovernmental and their family members that national treatment, clearly es- Council (EIC) at the level of Heads are implemented under the same tablishes that this treatment is of Government is summoned. At conditions and in the same man- available to the Member States. the proposal of the EEC Council, ner as for the citizens of the state At the same time, the Union will the Council considers any issues of employment is of great impor- expand the number of methods for which no consensus was tance. In addition, employees of procurement. In particular, the reached during decision-making and their family members have request for proposals will be intro- in the Council session. the right to receive free emer- duced. It gives the possibility to gency medical care and rescue select the best proposal not only The permanent supranational emergency care in their territories by price, but also by other criteria: regulatory body of the Eurasian in accordance with the same for example, the time period of Economic Union is the Eurasian procedure and under the same work execution, quality of works Economic Commission. It is a kind conditions as to the nationals of (qualification of bidders). of a supra-national government, the state of employment. with its headquarters in Moscow, For the first time, the parties started where national authorities have In respect of taxes and taxation, to pursue an agreed policy in the transferred some of their pow- it is provided that the Member Union in respect of consumer ers. The Commission acts in the States of the Union define areas protection. Previously, the con- interests of no particular state, but of cooperation in the tax policy tractual and legal framework of the combines and coordinates the in- for harmonization and improve- CU and the CES did not include terests of all the Member States of ment of tax legislation, including such provisions. The Treaty on the the Union, as the European Com- the mechanism for collection of EAEU stipulated that this policy is mission in Brussels. However, indirect taxes in performance of aimed at creating equal conditions the basic principle of operation is works, rendering services, con- for citizens of the Member States different from the European one – vergence of rates on the most to protect their interests against the EEC provides for the principle sensitive excisable goods. The unfair activity of business entities of of equality of the Member States, principle of non-discrimination lies the Union. It was determined that irrespective of economic power, at the heart of the arrangements. citizens of the Member States and territory and population. It will make it possible to prevent other people who live there enjoyed

30 1H 2017 Eurasian Economic Commission

The Commission includes creation of an independent judicial Thus, on January 1, 2015 a the Council and the Board. authority, issues of dispute resolution new stage of development The Council consists of one in the framework of the Customs of the Eurasian economic Vice Prime Minister of each Union were settled in the EurAsEC integration has begun. party, decisions are taken Court. The purpose of the Court of Launching the fully by consensus. In the Board, the EAEU is to ensure the uniform functioning Eurasian each state is represented by application by the Member States of Economic Union represents two members, decisions are international treaties in the framework not only fixation of a de taken by a qualified majority of agreements concluded with third facto deeper level of or by consensus. parties, and decisions taken by the economic integration within Union bodies. The headquarters of the Eurasian space in The Commission’s decisions have a the EAEU Court is located in Minsk. comparison with the stages direct effect on the territories of the of the Customs Union and Member States of the Union. They In 2015, the Republic of Armenia the Common Economic do not require additional approval and the Kyrgyz Republic, which Space, but also assertion at the national level. led the preparatory work since of legitimate strategy for 2012, accessed to the Treaty on the further integration The Commission has broad powers the Union. In terms of the content development. necessary for the implementation of and the degree of integration the the Treaty on the Union. Eurasian Economic Union is the second example of an economic The judicial branch is represented union in the world practice after the by the Court of the Union. Before European Union.

31 EurasianEurasian EconomicEconomic IntegrationIntegration:: FactsFacts andand FiguresFigures

Institutions of Eurasian Economic Integration

In 2012–2015, effective institutional framework of the Eurasian economic integration was formed: The Eurasian Economic Commission with its headquarters in Moscow, the Court of the Eurasian Economic Union located in Minsk. By 2025, it was decided to establish a financial regulator that will be located in Almaty.

The Eurasian Economic Commission (EEC) is a permanent supranational EEC regulatory body of the Eurasian Economic Union

DATE OF STARTING OPERATION 2 February 2012

PLACE OF LOCATION Moscow (the Russian Federation) The first supra-national regulatory body in the history of the Eurasian economic integration process

OPERATED BASED ON: Regulations on the Eurasian Economic Commission

MAIN OBJECTIVES OF THE COMMISSION enabling conditions for operation and development of the Union, as well as developing proposals in the area of economic integration within the Union.

THE COMMISSION SHALL CARRY OUT ITS ACTIVITIES BASED ON THE FOLLOWING PRINCIPLES: • ensuring mutual benefit, equality and respect for the national interests of the Member States; • economic justification of the decisions adopted; • openness, transparency and objectivity (Annex No. 1 to the Treaty on the EAEU, the Statute on the Eurasian Economic Commission).

32 1H 2017 Eurasian Economic Commission

The Court of the Eurasian Economic Union is a permanent judicial body of the Eurasian Economic Union

DATE OF STARTING OPERATION January 1, 2015

PLACE OF LOCATION Minsk (the Republic of Belarus)

OPERATED BASED ON The Treaty on the Eurasian Economic Union

The purpose of the Court’s activity shall be to ensure the uniform application by the Member States and the Union Bodies of the Treaty, international treaties in the framework of the Union, international treaties of the Union with Third Parties and decisions of the Union Bodies. The Court shall include two judges from each Member State, the term of office for each of them is nine years. The Chairman of the Court and the Vice-Chairman shall be elected to their positions from among the judges of the Court by Court judges in accordance with the Rules subject to approval by the Supreme Eurasian Economic Council. The Chairman of the Court and the Vice-Chairman may not be nationals of the same Member State. Status, composition, competence, procedure for formation and functioning of the Union Court shall be determined by the Statute of the Court of the Eurasian Economic Union. The Court shall consider disputes arising from the implementation of the Treaty, international treaties within the Union and (or) the Union Bodies’ decisions, The Financial Regulator upon a request of a Member State or upon a request of the Eurasian of a business entity (Annex No. 2 to the Treaty on the Economic Union Eurasian Economic Union, the Statute of the Court of the Eurasian Economic Union). The procedure of taking the oath by the judges – DATE OF STARTING OPERATION February 10, 2015. Creation of the EAEU Financial Regulator is scheduled Chairman of the EAEU Court since 2015 – Alexander for 2025 Fedortsov (Republic of Belarus). PLACE OF LOCATION The place of location of Financial Regulator shall be Almaty (the Republic of Kazakhstan)

33 Eurasian Economic Integration: Facts and Figures

Management Bodies of the Eurasian Economic Union

The Supreme President President Eurasian Economic of the Republic of the Republic Council of Armenia of Belarus

Serzh Alexander Sargsyan Lukashenko

The Eurasian Prime Minister Prime Minister Intergovernmental of the Republic of the Republic Council of Armenia of Belarus

Karen Andrei Karapetyan Kobyakov

The Eurasian Vice Prime First Deputy Vice Economic Minister, President Commission Council the Minister of the Republic of International of Belarus economic Integration Vasily and Reforms Matyushevskiy of the Republic of Armenia

Vache Gabrielyan

34 1H 2017 Eurasian Economic Commission

President President President of the Republic of the Kyrgyz of the Russian of Kazakhstan Republic Federation

Nursultan Almazbek Vladimir Nazarbayev Atambayev Putin

Prime Minister Prime Minister Prime Minister of the Republic of the Kyrgyz of the Russian of Kazakhstan Republic Federation

Bakytzhan Sooronbay Dmitry Sagintayev Zheenbekov Medvedev

First Deputy Vice Prime First Deputy Prime Minister Minister Prime Minister of the Republic of the Kyrgyz of the Russian of Kazakhstan Republic Federation

Askar Oleg Igor Mamin Pankratov Shuvalov

35 Eurasian Economic Integration: Facts and Figures

The Board of the Eurasian Economic Commission

Tigran Tatyana Timur Sergey Marat Sargsyan Valovaya Zhaksylykov Sidorskiy Kusainov

Chairman of the Member of the Member of the Board – Member of the Member of the Board of the Board – Minister in Minister in charge of Board – Minister in Board – Minister Eurasian Economic charge of Integration Economy and Financial charge of Industry in charge of Commission and Macroeconomics Policy and AGRICULTURE Competition and Antitrust Regulation oard e EEC B Th

The Organizational The Integration The Financial Policy The Industrial The Antitrust Support and Protocol Development Department Policy Department Regulation Department Department Department Business The Agricultural The Finance The Macroeconomic Development Policy Department The Competition Department Policy Department and Public Department Procurement Policy The Legal Department The Labour Migration Department The Statistics and Social Security The Administrative Department Department Department epartments E EEC D EEC E T H

The Advisory Committee The Advisory Committee for The Advisory The Advisory for Statistics Migration Policy Committee Committee for for Industry Competition and The Advisory Committee The Advisory Committee for Antimonopoly for Macroeconomic Tax Policy and Tax The Advisory Regulation, Price Policy Administration Committee for Controls and oard Agriculture Governmental The Advisory Committee for (Municipal) Intellectual Property Procurement e EEC B

h The Advisory Committee for Entrepreneurship

The Advisory Committee for Financial Markets

The Advisory Committee for

odies under t Social Security, Compliance with Pension Rights, Health Care Provision and Professional Activities of

isory B Working Population of the v

d EAEU Member States e A Th 36 1H 2017 Eurasian Economic Commission

Veronika Valery Mukay Adamkul Karine Nikishina Koreshkov Kadyrkulov Zhunusov Minasyan

Member of the Member of the Member of the Member of the Member of the Board – Minister in Board – Minister Board – Minister in Board – Minister in Board – Minister in charge of Trade in charge of charge of Customs charge of Energy and charge of Internal Technical Cooperation Infrastructure Markets, Regulation Information Support, Information & Communication Technologies

Tariff and Non-tariff The Technical Department​ of The Transport and The Information Customs Regulation Regulation and Customs Legislation Infrastructure Technologies Department Accreditation and Law Enforcement Department Department Department Practice Department for Internal The Energy The Domestic Market Defence The Sanitary, The Customs Department Markets Operation Phytosanitary and Infrastructure Department The Trade Policy Veterinary Measures Department Department Department

The Advisory The Advisory Committee The Advisory Committee The Advisory The Advisory Trade Committee for Technical Regulation, for Customs Regulation Committee Committee for Sanitary, Veterinary and for Oil and Gas Information Support, Application of The Advisory Committee Information and Phytosanitary Measures for Interaction of The Advisory Communication Regulatory Bodies at the Committee Technologies and The Advisory Committee Customs Border of the for Electric Power Information Security for Consumer Rights Eurasian Economic Union The Advisory Committee Advisory Committee for Transport and for Domestic Markets Infrastructure Operation The Advisory Committee for Natural Monopolies

37 Eurasian Economic Integration: Facts and Figures

Activity areas of the Eurasian Economic Commission

Chairman of the Board Tigran Sargsyan

The Chairman of the Commission Board shall organise the activities of the Board of the Commission and bear responsibility for the exercise of its functions. The Chairman of the Board of the Commission shall be appointed by the Supreme Council for a term of 4 years on a rotational basis, without the right of prolongation.

38 1H 2017 Eurasian Economic Commission

Member of the Board – Minister in charge of Integration and Macroeconomics Tatyana Valovaya

Key Trends of the idea of «integration of with specialized international in Integration integrations» and the concept organizations, including the UN of a Comprehensive Continental organizations. The following main The Eurasian Economic Union Eurasian Partnership; formats of international cooperation was created with the purpose have emerged: preferential and international positioning of the of forming and developing a • non-preferential trade agreements EAEU and promotion of objective common Eurasian economic and memoranda of cooperation perception of the Union in the space – that is, for the effective and other international regulations. international community; implementation of the tangible Activities of joint working groups benefits created by the freedom • analysis of possibilities established under memoranda of movement of goods, services, of deepening integration of understanding or cooperation capital and labour in the territory cooperation of the member between the EEC and foreign that is much larger than each states. governments are ensured and individual country, which became coordinated. a member of the Union. Work in order to improve the provisions of the Treaty on the Macroeconomics Further deepening of economic EAEU is carried out within the integration in the Union is the main respective Consolidated Working activity of the Eurasian Economic Group with participation of In accordance with the Treaty on Commission. plenipotentiary representatives the Eurasian Economic Union of of the Member States and the May 29, 2014, at the supranational The Integration Development EEC, including taking into account level an agreed macroeconomic Department carries out this work in the provisions of the Report on policy is conducted. several areas. First of all, it is: the implementation of the Main Directions of integration within the Coordination of macroeconomic • improvement of the rules of the Union. policy is due to creation in the Treaty on the EAEU of May 29, EAEU of the common economic 2014 and development of the The Report is issued annually space, i.e., a common market Union law; and includes both the analysis of for goods, services, labour • implementation of Main the present phase of integration and capital, where national Directions for International and proposals on deepening borders do not play a significant Activities of the EAEU and and development of integrational role in economic terms any elaboration of the proposals processes. more. Due to the fact that the for the Union external relations economy is mainly regulated at development; On the external track, the EEC the national level, through an activities are developing in the agreed macroeconomic policy, • analysis of prospects and abilities following areas: contacts with problems related to compatibility for inter-regional cooperation foreign governments; cooperation of integration goals of the Union expansion with partners, with regional economic and national development including under implementation integration associations; contacts objectives of the Member States,

39 Eurasian Economic Integration: Facts and Figures

rise of “competition of policies” 2. Consideration by the Member “economies of scale”, “synergy”, “a and maintenance of economic States of the Main Guidelines of common market”, etc. sustainability of the union as a the macroeconomic policy. This whole are being solved. document identifies the most 4. Formation by the Member important challenges for the States of forecasts for social and The Treaty on the Union identified Union’s economy in the short and economic development based on the following elements of an agreed medium term. the agreed interval quantitative macroeconomic policy of the values of external parameters. Member States. 3. Consideration by the Member States of the Main Direction Statistics 1. Compliance by the Member for Economic Development States with quantitative values of the Union until 2030. It is a Operational and open access of indicators that determine the comprehensive strategy document to statistical data is one of the sustainability of their economic defining the goals, objectives factors contributing to increasing development (included in the of economic development of the competitiveness of the Treaty on the Union): the annual the Union, directions, where economies of the EAEU countries, consolidated budget deficit of the cooperation could have a positive and improving the investment public government sector; the impact on the competitiveness of climate in the Eurasian Economic public government sector debt; the the Member States, as well as the Space. The Commission’s rate of inflation. criteria for determining areas of activities in statistics contribute the economy that have potential to the openness of integration The Eurasian Economic for integration. Implementation of processes in their statistical Commission together with the the Main Directions for Economic measurement. The Commission is Member States are empowered Development must ensure that working to support the integration to take measures aimed at each Member State gets an process with diverse and timely stabilizing the economic situation additional economic benefit and statistical information and analytic and ensuring compliance accelerate (simplify) achieving materials on the socio-economic with the quantitative values of national strategic goals by the development of the EAEU macroeconomic indicators. effects of “trade creation”, effect of Member States.

40 1H 2017 Eurasian Economic Commission

Member of the Board – Minister in charge of Customs Cooperation Mukay Kadyrkulov

Customs Cooperation following priority areas of work of • cooperation with the World the customs unit of the Eurasian Customs Organization and An important factor in the Economic Commission may be other international specialized sustainable development of the specified: institutions; study and analysis of Eurasian Economic Union is the global best practices, advanced • development and improvement effective foreign economic activity. international developments of the EAEU customs legislation, Creating favourable conditions aimed at the simplification of and ensuring a uniform practice for the business environment and customs rules and procedures, of its application; entrepreneurial activity, customs as well as at increasing efficiency regulation is one of the factors • development of advanced of customs control in execution stimulating economic development technologies within the of foreign economic activity with of the EAEU countries. Thus, the common customs territory of a view to their further introduction main long-term goal is to create the Union, such as the “single into the practice of the EAEU; simple and effective mechanisms window” mechanism in the of customs administration for system of foreign economic • ensure cooperation between the entrepreneurs. The measures activity regulation of the EAEU EEC and business associations developed and undertaken are Member States, the institute of the EAEU Member States in aimed at creating equal competitive of authorized economic the framework of the Advisory conditions for carrying out foreign operator, foreign trade operators Committee for Customs economic activities throughout the identification systems, etc.; Regulation and the Advisory Union. Committee for Regulatory • development and improvement Authorities Cooperation at the of customs information The competence of the customs border of the EAEU; technologies and common Commission’s customs unit processes within the EAEU, • arrangement of information includes a wide range of issues of providing for information exchange between the customs customs regulations. It includes exchange between customs bodies of the EAEU Member various aspects of the legal and other government bodies, States and other countries; regulation of relations connected as well as with foreign trade with the movement of goods • maintenance of the environment operators; across the customs border of the for operation, development, Union, their transportation within • reengineering of the traditional and elaboration of common the EAEU under the customs practices of execution and approaches to placement, control, temporary storage, regulation of foreign economic construction, reconstruction, customs declaration, release activity on the territory of the maintenance and technical and use in accordance with the EAEU through the transition equipping of places of goods customs procedures, conduct to electronic communication, movement through the EAEU of customs control, customs development and implementation customs border, free (special) payments. of structures and formats of economic areas, temporary electronic documents and data in storage warehouses, bonded At this stage of integration electronic form used for customs warehouses, duty free shops, relations development, the purposes; office buildings.

41 Eurasian Economic Integration: Facts and Figures

Member of the Board – Minister in charge of Trade Veronika Nikishina

Trade in the Union, to support exports Egypt, Israel, India and Singapore, and international cooperation. to unify preferential trade regime Today, the efforts of regulators in Therefore, the Commission is with Serbia, to transit to a the field of trade should be focused constantly working on “fine- preferential trade regime with Iran. on creating conditions for export tuning” of the customs tariff, for expansion, inclusion of domestic example, lowering customs duties In the autumn of 2017, another products in global value chains for components, raw materials, round of negotiations will be and formation of own production equipment. Conclusion of free held on the Agreement on Trade chains. Through incentive of export trade agreements also facilitates and Economic Cooperation oriented production, products that achieving this goal. between the EAEU and the are competitive at international People’s Republic of China. Work markets, the set task of import The Commission continues to work is underway to link the Eurasian substitution without technological on the application of reasonable Economic Union and the Silk Road conservation is also solved. and appropriate measures to Economic Belt. protect the domestic market and to Accordingly, the trade unit of the combat anti-competitive practices The Commission is developing a Eurasian Commission faces a of trade partners from third set of measures to promote exports number of challenges: increasing countries. within the Treaty on the EAEU, the competitiveness of the EAEU which will be used in conjunction goods, facilitating access to the For the purpose of expanding with the countries of the Union. It is markets of third countries, forming the access to the markets of necessary to establish mechanisms joint policies and practices to third countries, the Commission for joint insurance and crediting of promote goods of the Union. is developing trade regimes with export, to support and promote priority partners. cooperation products of the Union, To improve the competitiveness of to conduct marketing campaigns, products of the EAEU countries, A range of free trade agreements to create a system of voluntary it is important to ensure the is being concluded. The Free Trade certification. efficiency of production, the Area (FTA) Agreement with Vietnam availability of necessary raw entered into force on October 5, In addition, the EEC is constantly materials and intermediate goods. 2016. monitoring restrictive measures It is necessary to reduce costs of against goods of the EAEU manufacturers and the net cost In 2015-2016, the decisions were countries imposed by third of finished products, to stimulate taken to launch negotiations on countries, and from 2015 it has also the development of technologies concluding similar agreements with been working to eliminate them.

42 1H 2017 Eurasian Economic Commission

Member of the Board – Minister in charge of Technical Regulation Valery Koreshkov

Technical regulation the protection of life and health of taking into account harmonization people, property, environment, life with international standards, The task of the area is to create a and health of animals and plants, guidelines or recommendations. modern regulatory framework in prevention of actions misleading Such a policy results in creation the field of technical regulation, to consumers, and assurance of of optimal conditions for free form the appropriate conditions energy efficiency and cost-effective circulation of goods that are for ensuring the safety of use of resources. safe for life and health of human, products in the EAEU Member animal and plant, property and States’ markets and increasing environment. business competitiveness Sanitary, and living standards of the Phytosanitary and Consumer Rights Member States’ population. Veterinary Measures The technical regulation is the Protection basis for providing the safety (SPV Measures) of product throughout their life A new direction of activity since cycle. The mechanisms laid The main issues covered by the 2016 is consumer rights protection. down in it allow eliminating many Eurasian Economic Commission Priority areas are defined, in which, barriers to trade, thus ensuring in the field of SPV measures are based on recommendations of freedom of movement of goods. development of normative legal the Commission, legislation that Problems of technical regulation acts in order to ensure sanitary ensures consumer rights will be within the EAEU lie in three and epidemiological welfare, harmonized. These areas include interrelated planes covering legal quarantine phytosanitary and e-commerce, air travel, tourism regulation of relations in the field veterinary&sanitary safety of and financial services. The of establishing, application and the EAEU territory, scientific Commission’s recommendation implementation of mandatory substantiation of SPV measures for Member States that identifies requirements for products and application, weighted assessment common approaches to consumer production processes, installation, of risks, compliance with the rights protection in distance commissioning, operation, proportionality of restrictive transactions, including in the storage, transportation, marketing measures and removal of cyberspace, has been prepared and disposal; in the field of unjustified administrative barriers to and will be adopted in 2017. application of voluntary standards trade. These issues are addressed The reviews of the practice of aimed at the implementation in the framework of the main interaction between the authorized of such requirements; in the tasks of the area, among them is bodies of the parties in the field field of assessment of products assurance of the formation of an of consumer rights protection, for compliance with technical agreed policy of the Member States provision of consumer rights regulations of the Eurasian in application of SPV measures, of citizens in the application of Economic Union. sanitary and epidemiological non-refundable air transportation welfare of the population, protection tariffs have been prepared, and The objectives of development of the common customs territory the possibilities of using food and adoption of technical from introduction and spread of labeling to promote the principles regulations are assurance within quarantine objects and epizootic of healthy nutrition in the Union are the common customs territory of well-being of the customs territory, being studied.

43 Eurasian Economic Integration: Facts and Figures

Member of the Board – Minister in charge of Energy and Infrastructure Adamkul Zhunusov

Energy identified as one of the most (technological) security. With important directions of activities of globalization, the volume of traffic The main task of the area is the Union. between countries is growing conducting a coordinated providing new opportunities for the energy policy of the Eurasian Union for implementation of the total Economic Union Member Transport transit capacity, creating a land link States for the efficient use of and Infrastructure between Europe and Asia. The use the aggregate energy potential of synergies in this area is one of the and the creation of common The main goal of the area is main advantages of integration. energy markets. Implementation formation of a coordinated (agreed) of this task will provide energy transport policy of the Member security and sustainable growth States of the Eurasian Economic Natural Monopolies of the national economies of Union aimed at ensuring economic the Member States, balance integration, consistent and gradual the interests of consumers and formation of a common transport The objectives of the direction producers of energy, improve space based on the principles include the application of common economic efficiency and reliability of competition, transparency, principles and rules for regulating of fuel and energy complexes, security, reliability, availability the activities of natural monopolies optimize the use of primary and sustainability. First of all, established by the Treaty on the energy resources and expand this implies creating a common Union, facilitating harmonization of non-resource export potential. transportation service market, the spheres of natural monopolies, Long-term stable development taking agreed measures to ensure as well as determining the of the economies of the Union mutual advantages in transport sequence of applying measures to Countries is impossible without and infrastructure, implementation approximate the legislations of the constantly developing the fuel of best practices, integration of EAEU countries. Implementation and energy complex. Therefore, transport systems of the Union of these objectives will simplify conducting an coordinated energy countries in the world transport provision of goods and services for policy of the Eurasian Economic system, efficient use of the transit consumers, and ensure transparent Union countries aimed at creating potential of the Member States, and non-discriminatory conditions common electric energy, gas, improving the quality of transport for access to the infrastructure of oil and oil product markets is services, provision of transport natural monopoly entities.

44 1H 2017 Eurasian Economic Commission

Member of the Board – Minister in charge of Industry and Agriculture Sergey Sidorskiy

Manufacturing products, including by deepening reducing import dependence and Industry cooperation and increasing increasing export potential. localization of production; creation All industrial policies within of new production chains and In accordance with the Treaty on the EAEU shall be aimed at innovative industrial sectors; the EAEU, this activity involves accelerating and improving production modernization in development of mechanisms and the sustainability of industrial traditional industries; building-up measures of interstate cooperation development, improving the high-tech products export. to implement integration processes competitiveness of industrial and to provide for the sustainable systems of the Member States, Within the Union, cooperation development of agroindustrial implementation of effective is developing in priority sectors; complex. cooperation aimed at increasing a business and innovation innovation activity, and elimination infrastructure is being formed, For this purpose, joint Eurasian of barriers in the industrial sector, including technological platforms, forecast demand and supply including with respect to the engineering centres; conditions balances for the main types of movement of industrial goods of for fair competition are being agricultural products are prepared, the Member States. developed, interstate programs actions on the state support of and projects are being developed agriculture, removal of barriers Industrial policy within the and implemented, a network in mutual trade are coordinated, Union is formed by the Member of industrial cooperation common requirements for the States in the main directions of and subcontracting is being production and circulation of industrial cooperation and carried implemented, a system of agricultural products and food out by them with the advisory transfer of technology is being are elaborated, mechanisms for support and coordination of the established. technology transfer and scientific Commission. The objectives, and innovative cooperation are principles and instruments of developed, agreed approaches to industrial policy, as well as the Agroindustrial export development are formed. competence of the States and the Commission are defined in section Complex Conducting an agreed agroindustrial XXIV “Industry” of the Treaty on the policy provides establishment of EAEU. In the agroindustrial sector, the an all-Union system of sectoral Member States, with coordination priorities, formation of chains of In accordance with the Main of the EEC, conduct an agreed cooperation consistent with national Directions of Industrial Cooperation agroindustrial policy aimed at expertise and resource security, within the EAEU adopted by effective implementation of the strengthening food security in the Heads of Governments, the resource potential of the Union the EAEU and strengthening the industrial policy implemented countries with the purpose of position of the States and raising in the Union is focused on joint producing competitive products, the states and the Union in general development by the Member States meeting demands of the in the global market of agricultural of new types of export-oriented common agricultural market, products.

45 Eurasian Economic Integration: Facts and Figures

Member of the Board – Minister in charge of Competition and Antitrust Regulation Marat Kusainov

Investigations on the signs participation of antitrust bodies, Competition of violations of the common other ministries and departments and Antitrust competition rules, initiation and of the EAEU Member States, Regulation examination of cases, where there representatives of business, are any facts of such violations, and professional and scientific Development of an efficient imposition of sanctions on violators community, and are proactive economy, i.e. intensification of became particularly important in prevention measures aimed at investment cooperation, stimulation the work of the Commission. preventing and/or suppressing of innovation processes, and violations of common competition creation of a favourable business In addition, implementation of rules. climate on the territory of the international treaties and decisions Eurasian Economic Union, is of the EAEU bodies, which are part The EEC also implements the task impossible without competition, of the law of the Union and regulate of advocating for competition – it antitrust regulation and control of common competition rules, is conducts an open antitrust policy, public procurement. continuously monitored. thereby increasing the level of legal awareness of market operators and For this purpose, a legal framework To prevent violations of competition the level of awareness of business was created that ensures equal rules, the EEC assesses the about the benefits of developed competition in cross-border state of competition in cross- competition. markets. Today, the Eurasian border markets in the areas Economic Commission faces the such as industry, agriculture, fuel Another important factor tasks of monitoring compliance and energy complex, transport, in increasing efficiency of with the common principles telecommunications. This work competition policy is interaction and rules of competition in the allows the Commission not only with international organizations, transboundary markets of the to assess the state of competition regional integration associations, EAEU and suppressing anti- in the relevant market, but to business associations and competition agreements, abuse find specific mechanisms aimed competition authorities of of dominant position, unfair at restoring and developing third countries to establish competition. The work carried out competition without the EEC cooperation, to share experience allowed delegating the powers of applying fines. on the application of competition the EAEU supra-national antitrust law and antitrust regulation, and authority to the EEC competition Such measures are developed to study and apply international and antitrust regulation unit in 2015. by the Commission with the practice.

46 1H 2017 Eurasian Economic Commission

Member of the Board – Minister in charge of Economy and Financial Policy Timur Zhaksylykov

Economy development in this sphere moves especially in knowledge-intensive and Financial Policy on. Our efforts aim at developing sectors. of new ideas, which realization The main long-term goal of the will contribute to the functional Implementation of a harmonized ECE in the field of economy and effectivness of a common labour policy in business and investment finance policy is to create favourable market. However the principal activities in the Member States with business conditions in our countries, requirement of any actions is the participation of the business to minimize the administrative maintaning of the equal rights for all community will eliminate excessive barriers. After all, it is the business employees who are citizens of the administrative barriers, improve that should be the main driving EAEU states. the quality of business regulations, force behind the integration of the improve the business climate, economies of the Member States of Pension contract for employees of including investment activities and the Eurasian Economic Union. the Member States will enhance mutual trade in services in the social protection of the Member EAEU countries. In this regard, an important States citizens. According to the strategic objective of the EEC for document, pension protection will The gradual introduction of the the long term is establishment be implemented within equal terms single services market within of a common financial market of of the country of employement. the Union is also a priority for the EAEU and defininig the basic the Commission activity. The directions of its development. It Efforts to simplify mutual travels of Treaty on the EAEU defines the will ensure the effective allocation the Union citizens are also being basic principles of liberalization of capital, diversifications of risks, made. The Treaty will give the of trade in services, with a increasing competition in the opportunity to cross inner frontiers gradual reduction of a number of financial services market, remove of the Member States by means of limitations and exceptions, which barriers to mutual access and identity documents. As a result it greatly expands the opportunities ensure access to all financial will increase mobility of the Union for business activities in our instruments of the Union for States citizens. countries. In the area of tax policy business and citizens. the work is being conducted for Another important task of the creating tax conditions for fruitful The Treaty on the EAEU established Commission is to conduct a non-discriminatory operation norms that guarantee the freedom coordinated policy in intellectual of business within the common of movements of labour resources property in certain respects within economic territory, removing and its rights. In other words, it the whole territory of the Eurasian all obstacles along the way. In was created a common labour Economic Union. This will clearly the foreground lies a planned market across the whole integration increase the attractiveness of convergence of excise tax rates on space. Nevertheless the process of the Member States for investors, the most sensitive products

47 Eurasian Economic Integration: Facts and Figures

Member of the Board – Minister in charge of Internal Markets, Information Support, Information & Communication Technologies Karine Minasyan

Internal Markets amount of exceptions and barriers, with minimum amount of restrictions, as well as the priority of exceptions and limitations. In a situation of a global economic solving the tasks on establishment turbulence, one of the main of the common/single markets led Adaptation of the global best integration effects contributing to the adoption in December 2015 practices for monitoring, to bailout of crisis developments, by the Presidents of the Member assessment and settlement of recovery of economic growth and States of the decision to establish problematic issues to the EAEU achieving sustainable development an appropriate new direction of the realities at the interstate level will of the EAEU economy through the Commission activity. allow the Member States to use economy of scale, creation of an the opportunity of the Commission environment that would encourage One of this direction’s main goals as an independent supra-national business activity, competition and is reduction of a gap between the body. The EEC is fully aware of its mutual trade, should be provision for declared standards of the Eurasian special responsibility for achieving the cross-border freedom of moving integration and the practice of the the goals set out in the agenda of goods, services, capital and labour. daily work of public authorities the Eurasian Economic Union for and business entities in the EAEU ensuring the efficient operation of The need to concentrate efforts on domestic markets based on domestic markets, and focuses its creating conditions for operating the principle of four “freedoms”: attention on joint activities with all the internal market of the Union freedom of movement of goods, stakeholders to solve the common without barriers, with minimum services, capital and labour without tasks of Eurasian integration.

Existing definitions

means an obstacle to free movement of goods, services, capital and labour within the framework BARRIER of operation of the Union internal market that does not comply with the Union law.

means an exception (deviation) provided for by the Union law on non-application by a member EXEMPTION state of common rules of operation of the Union internal market.

means an obstacle to free movement of goods, services, capital and labour within the framework RESTRICTION of operation of the Union internal market that occurred due to lack of legal regulation of econom- ic relations, whose development is enshrined in the Union law.

48 1H 2017 Eurasian Economic Commission

Informatisation, the Union territory. Major steps directions of realization of the digital towards this goals have become agenda of the EAEU until 2025. Information projects on formation of common An elaboration of the document and Communication processes, development of integral is currently being finalized and Technologies information system of the EAEU as main directions of the digital and ransboundary trust space. agenda implementation are Digital transformation of economy To date there are 75 positions in considered: is one of the main conditions the general process list. In 2017 • a digital transformation of of development of the Eurasian scheduled to be launch in industrial economic branches and cross- Economic Union as a contemporary use 31 process. branches transformation in the integrative format together with Union; global leaders of digital economy: A topical issue within the digital USA, UE, ASEAN, China. The agenda of the EAEU to day is the • a digital transformation of relevance of the digital agenda was necessity of launching the pool of markets for goods and services, marked by the end of 2016, when groundbreaking digital projects. assets and labor market; the Heads of EAEU States signed • a digital transformation of the the Statement on the digital agenda Timeliness in the formation of management and integration of the Union. And in 2017 the digital main points for digital developing processes in the Union; agenda became a central theme in and cross-border rights in digital the Comission as well as in all the economy may be explained by the • a development of digital EAEU states. Digital conversion is growth rate of the digital market infrastructure and secure of based on the changes connected and by the fact that national digital processes. with implementation of information regulation of this sphere at that and communication technologies. moment in both five countries is still Experience has shown that the evolving. The first digital initiative implementation of new models, The main lines of the EAEU of the Union is the decision of processes, modern information coherent policies realization are the parties on digital tracking of and communication technologies based on the modernization of production, goods, services, assets serve as a base to set up more interstates communication process within the territory of the EAEU. effective integration processes and and maintenance of interoperability. transform economy from analogue The measures of the Commission The Supreme Eurasian to digital. are following: a shift towards the Economic Council has requested electronic document flow system, governments of the Member The main role in the development the use of digital signature and States jointly with the Eurasian process belongs to the later providing electronic interaction Economic Commission to develop competences that out states can between state authorities and and represent against the Eurasian collect to obtain the best total business, as well as the expansion Intergovernmental Council until result providing a turn to the digital of the front-end system within December 1, 2017 the main economy.

49 Eurasian Economic Integration: Facts and Figures

Procedure for preparation and execution of international instruments

Authorised authorities

Organization of the decision making process of the Eurasian Economic Commission

involves close, phased and coordinated interaction with the parties – relevant ministries and agencies of the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic and the Russian Federation.

It ensures the adoption of high-quality developed and subsequently agreed decisions that take into account the interests and requirements of the parties, as well as the best global practices.

50 1H 2017 Eurasian Economic Commission

International Treaty

Keeping of the international treaty in the EEC. The Supreme Eurasian Depository certified copy of the international treaty shall be sent to the Ministries of Foreign Economic Council Affairs of the EAEU countries for the internal legal procedures necessary for its entering into force

The Eurasian Intergovernmental Council

The draft document shall be sent for the The Eurasian Economic internal procedures required for its signing Commission Council

Relevant subdivision of the EEC The draft document shall be sent to the parties for the internal approval procedure

Relevant Member of the Board – Minister of Representatives of the authorised the EEC authorities of the Parties Session of the EEC Board

Relevant subdivision of the EEC Initiative

Relevant Advisory Committee

Relevant Member of the Board – Minister of the EEC

Relevant subdivision of the EEC

The Eurasian Economic Commission

51 Eurasian Economic Integration: Facts and Figures

Interaction of the EEC with Business Community of the Member States of the Eurasian Economic Union

The EEC includes 22 Advisory Committees 30 Subcommittees

more than more than 50 Working Groups 20 Expert Groups

52 1H 2017 Eurasian Economic Commission

The EEC regularly interacts with the business Permanently working bodies of the Commission are community of the Eurasian Economic Union Advisory Committees, Subcommittees, Working countries in order to achieve greater transparency Groups and Expert Groups whose members include of the Commission’s activity, and to ensure mutual officials and businessmen of the Union countries. benefit and equality. In turn, the strategic and systemic issues are The EEC has established mechanisms that allow discussed within the framework of the Advisory businesses to take part in the discussion of draft Council for Interaction between the EEC and the decisions of the Commission. Some decisions are EAEU Business Council. made at the initiative of enterprises; they are based on a consolidated position of the business of the Union countries.

Formats of Cooperation between the EEC and the EAEU Business Council

The EAEU Business Council

The EAEU Business Council is a permanent barriers, exemption and limitations of mutual access to coordination and advisory body of business circles the markets of the integration association. of the Union countries. The Council includes the Union of Industrialists and Entrepreneurs (Employers) On May 24, 2016, the Memorandum of Cooperation of Armenia, the Confederation of Industrialists between the Eurasian Economic Commission and the and Entrepreneurs (Employers) of Belarus, the Business Council of the Eurasian Economic Union was National Chamber of Entrepreneurs of Kazakhstan signed. The document confirms the importance of taking “Atameken”, the Kyrgyz Union of Industrialists and into account the interests of the business communities of Entrepreneurs and the Russian Union of Industrialists the Union countries to ensure its effective development. and Entrepreneurs. The Business Council is the Feasibility of the formation of a consolidated position successor of the Belarus-Kazakhstan-Russia of the business communities on the matters related to Business Dialogue. business activity in the Union has been recognized.

The Council develops a coordinated position of the The document describes the main areas of EAEU business community in its interaction with the cooperation between the Commission and the EAEU bodies of the Union, establishes direct communication Business Council such as consideration of proposals and dialogue between the Union business circles, of the Business Council aimed at creating a normative promotes trade and economic relations, industrial legal base of the Union, holding business forums with and financial cooperation, as well as improving the participation of business communities of the Member competitiveness of national economies, identifying States.

The Advisory Council for interaction between the EEC and the EAEU Business Council

In October 2016, the Advisory Council for Cooperation association, with participation of business associations between the EEC and the EAEU Business Council of the Union member states. was established, and its statutes were approved. This body became the successor of the Advisory Council The Advisory Council accumulates views and for Interaction of the EEC with the Belarus-Kazakhstan- proposals of national and sectoral business Russia Business Dialogue. associations of the Union countries, aimed at improving the regulatory framework of the EAEU. The Advisory Council is a platform for the continuous discussion of strategic and systemic issues related to the development and functioning of the integration

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Advisory Committees and Working Groups

Advisory Committees and Working Groups operate in • interact with leading experts of authorised public all activity areas of the Commission within the scope authorities and the EEC on system and strategic of forming systemic work between the EEC and the economic issues of the Union functioning, business community. • prepare proposals on improving the law of the Union to meet the needs of the market. Representatives of all national business communities of the EAEU member states act as independent The Advisory Committee for Entrepreneurship was experts of the Advisory Committees, Working and created under the Board of the Commission with a Expert Groups on a permanent basis. view to improving the business environment in the Union member states and the systemic elimination of Within the scope of these formats, representatives of excess pressure upon business. business regularly:

Regulatory Impact Assessment (RIA)

Regulatory Impact Assessment (RIA) is a mandatory 714 comments and proposals aimed at improving the step in the process of preparation of draft decisions business environment in the Union countries. More of the Commission which may have an impact on than 60% of these have been implemented. With the business activities. introduction of the RIA procedure into the daily operation of the Commission, terms for placement on the EEC On April 1, 2015, the EEC Working Group for RIA of the website of draft decisions of the Commission affecting Commission draft decisions began to work, which, from business activities increased from 15 to 93 calendar the beginning of its work till June 30, 2017, introduced days prior to the date of their expected adoption.

“Operation of Domestic Markets” Portal

Operation of Domestic Markets Portal is a system of the Union without barriers, exceptions and restrictions, information interaction with stakeholders, in particular and ensuring the implementation of one of the key with businesses, in identifying and removing obstacles directions in this work – monitoring and identification of within the Union. It provides an opportunity to report obstacles. directly to the Commission about obstacles and to monitor progress in respect of the application. In general, since the establishment in 2016 of the Domestic Markets Operation Department in the EEC, Creation of the information portal allowed involving more than 10 barriers in the domestic market of the more people in the work to ensure the functioning of Union have been eliminated.

Administrative Barriers Elimination

Within the framework of business advocacy and in were reviewed. Almost for every tenth draft, proposals order to eliminate excessive administrative barriers to were made on elimination of administrative obstacles the effective business development in the Union, the to business and unreasonable expenditures of Commission carries out expert examination of the representatives of the business community that raise efficiency of draft EEC regulations that affect the interests barriers to free movement of goods, services, capital and of business entities. labour in the Union countries.

From October 2012 through the first half of 2017, more The businessmen take part in the consideration of the than two thousand draft regulations of the Commission EEC resolutions concerning business activities.

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Ease of Doing Business Ranking*

Changes Country Ranking 2017 Ranking 2016 Ranking 2015 for 2015–2017

The Republic of Korea 5 4 5 0

Great Britain 7 6 8 +1

The USA 8 7 7 –1

Germany 17 15 14 –3

France 29 27 31 +2

Armenia 38 35 38 0

Kazakhstan 35 41 53 +18

Belarus 37 44 43 +6

Russia 40 51 54 +14

Israel 52 53 40 –12

Kyrgyzstan 75 67 67 –8

China 78 84 90 +12

Uzbekistan 87 87 141 +54

Vietnam 82 90 78 +4

Iran 120 118 130 +10

India 130 130 142 +12

Egypt 122 131 112 –10

Tajikistan 128 132 166 +38

* http://www.doingbusiness.org/.

The positions of the Member States in the Ease of At the same time, in certain positions of the ranking, Doing Business Ranking indicate roughly equal starting some Member States are at the top not only within the conditions for the operation of the business in the EAEU. Union but also in comparison with the rest of the world.

55 Eurasian Economic Integration: Facts and Figures

Eurasian Integration as а Part of Global Economy

Key Partners of the Eurasian Economic Union Globally

Vietnam Iran Chile 4.3 2.3 0.8 92.7 79.0 18.1

GDP 201.3* GDP 376.8* GDP 247.0 *

Israel The Republic MERCOSUR1 of Korea 2.6 16.0 7. 2 8.5 51.6 292.1

GDP 318.4* GDP 1,411.2* GDP 2,713.0*

Egypt China ASEAN2 4.3 78.6 14.9 91.7 1,382.7 622.4**

GDP 332.3* GDP 11,218.3* GDP 2,549.4*

India Singapore ЕU3 8.8 2.4 237. 2 1,295.7 5.6 508.2

GDP 2,256.4* GDP 297.0* GDP 16,408.4*

Foreign trade volume of the EAEU Population, mln people GDP Aggregate GDP for 2016, bln USD Member States in 2016, bln USD

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* Data from the official web site of the International Monetary Fund. ** Data from the official web site of the АSЕАN.

1 Countries included in the MERCOSUR: Argentina, Brazil, Paraguay, Uruguay, Venezuela.

2 Countries included in the ASEAN: Brunei, Vietnam, Indonesia, Cambodia, Laos, Malaysia, Myanmar, Singapore, Thailand, Philippines.

3 Countries included in the EU: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Great Britain, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden. 57 Eurasian Economic Integration: Facts and Figures

Eurasian Economic Union: global scale. The EAEU as a subject of international law

Regional economic inte- gration is a key trend in the global economy, the future of which will largely depend on the effectiveness of the integration of the global dialogue groups and their internal stability. Therefore, trying to take the best posi- tion in a new structure of the world economic system that has been emerging in recent years, the Eurasian Economic Union Member States devel- op their project of economic integration. Chairman of the EEC Board Tigran Sargsyan on the 2nd International Forum of the Heads of Representative Government Bodies of Eurasia. June 27, 2017 The Treaty on the Eurasian Economic Union established the mitment of its members to the International EAEU as a fully-fledged party of objectives and principles of the Cooperation the global economic relations. United Nations Charter and other Moreover, it laid the solid founda- universally recognised principles The Union’s international tion for the international relations and regulations of international activities are carried out between the Union and other law. by its bodies (the Supreme entities – third parties, their inte- Eurasian Economic Council, gration associations, and interna- The Eurasian integration project not the Intergovernmental Coun- tional organisations. The Eurasian only gained legal independence cil, the Commission, and the Economic Union as an interna- and internationally recognised in- Court) in accordance with the tional organisation of the regional fluence, but also became an active Procedure of international economic integration has the legal and prominent player in internation- cooperation conducted by the personality and is vested with the al relations. Eurasian Economic Union. right to enter into international treaties with other parties of the In order to expand the In accordance with this document, international relations and under- international recognition of the the Main Directions of the interna- take obligations corresponding Eurasian Economic Union, the tional activity of the EAEU are taken to the status of an international EEC is working to form the on the short-term basis, which are organisation. vision of the EAEU as a reliable followed by the Commission in ex- and predictable economic ercising its international contacts. The Treaty on the Eurasian Eco- partner. Representatives nomic Union of May 29, 2014 in of the Commission deliver To date, the following tracks accordance with Article 102 of the speeches and presentations of international cooperation Charter of the United Nations was to the governmental, business of the Commission have been registered in the United Nations and expert communities of formed – with regional integration Secretariat on July 24, 2015. Europe, Latin America, Asia associations, governments of Registration of the Treaty provides and CIS, in the USA, Republic third countries, and international openness and transparency of the of South Africa etc. and take organizations. agreements of the participants part in regular meetings with thereto at the highest internation- diplomatic missions, international Interaction in these areas is con- al level. The Treaty on the EAEU organizations, and business ducted in a variety of formats confirmed once more the com- structures. ranging from memorandums of

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understanding and deepening cludes representatives of the EEC policy. Free trade agreements are cooperation to agreements on and the authorities of the Union also intended both to create better creation of a free trade zone (FTZ). Member States and the partner conditions for the expansion of ex- Generally, the interaction starts in state. At the sites of the Working port supply of non-primary goods a memorandum format that allows Groups, the parties get an addi- and to include national economies creating a platform for discussion tional opportunity to deepen their of the Union members in the global and deepening cooperation in the trade and economic contacts with value added chains. future. the «far arc» countries, especially those, with which there are no Thus, the EAEU representing a Opportunities that coopera- appropriate bilateral mechanisms, broad market with a population of tion under a Memorandum of for example, intergovernmental over 180 million peo-ple, access to Understanding and Coopera- commissions. In addition, activi- skilled labour force, and transport tion provides for. ties of the Working Groups pres- infrastructure, is an attractive trade ent a real opportunity to involve and eco-nomic partner. The Eurasian Economic Commis- representatives of business circles sion concludes Memoranda of in the integration agenda and In order to promote internation- Understanding and Cooperation various formats of cooperation. al cooperation, the Heads of the with foreign countries, regional as- Business forums are held on the Member States set the objectives sociations and international organ- margins of session of Working for preparation of the Agreement izations. Groups. on the Procedure for Conclusion of International Treaties between the The Memorandum of The format of the EAEU and third countries, integra- Cooperation with the Memorandum with regional tion associations and international Government of a Foreign associations and international organizations, Regulations on the State is the optimal format to organizations provides for Status of an Observer State in the institutionalize the dialogue an opportunity to deepen EAEU, Regulations on Conjunction on the economic agenda cooperation with the aim of of the Union and the Silk Road Eco- with regard to matters exchanging experience and nomic Belt Initiative, Regulations referred to the Commission’s studying best practices of on Deepening Economic Relations competence, as well as a operation, and also helps and Developing Cooperation with universal negotiating platform to position the Union as Third Countries, including Moldavia, that creates the conditions for a reliable and promising and other SIC countries that are not further deepening of bilateral partner. member states of the Union, China, cooperation. India, Israel, Egypt, Iran, Cambo- International contacts of the Com- dia, Singapore, Serbia, Mongolia, Memoranda cover almost all the mission are focused on the de- Greece, Peru, Chile, the Republic activities of the EEC – from phy- velopment of trade and economic of Korea, Ecuador, Jordan and tosanitary measures to antitrust cooperation of the Member States integration organizations such as regulation. There are such aspects of the EAEU with third countries, ASEAN, the African Union, the An- of interaction like cooperation in diversification and innovative dean Community, MERCOSUR and innovations (with Peru and Cam- development of their economies, the SCO, Regulations on Establish- bodia), in information technologies increase in volumes and improving ing Relations between the Eurasian (with Singapore, Cambodia and the trade and investment frame- Economic Commission and the Moldova). The Memorandum on work that will eventually contribute European Commission. Cooperation between the Eurasian to the further development of the Economic Commission and the Union as an effective and competi- Republic of Moldova also includes tive international organization. the areas of the digital economy The CIS and labour migration. Creation of a preferential agreement network to ensure beneficial trade One of the first steps of the As a rule, in accordance with the relations with partners in different Commission’s international co- Memorandum, a joint Working regions of the world is the priority operation was the establishment Group is established, which in- task in the area of the EAEU’s trade of contacts with the Standing

59 Eurasian Economic Integration: Facts and Figures

Committee of the Union State of Belarus and Russia and the Exec- utive Committee of the CIS.

In April 2017, a Memorandum of Cooperation was signed with the Republic of Moldova; the Presidents of the EAEU countries welcomed the request of Moldova to obtain the status of an observer country in the EAEU. A process of legalizing the status in accordance with the criteria of the Union is underway. In particular, Regulations on granting an observer status are being developed.

The Commission takes part in the event of economic nature in the CIS member states, conducts presenta- Tigran Sargsyan, the Chairman of the EEC Board and Igor Dodon, the tions of the EAEU for representatives President of Moldova, signing the Memorandum of Cooperation and of the official, business community Understanding between the EAEU and the Republic of Moldova in Kishinev. and the expert community. April 3, 2017.

How negotiations on the free trade zone are conducted

Both the supranational body (the EEC) and any of the Member States may initiate negotiations between the Eurasian Economic Union and a third country or a group of countries for creation of a free trade zone. A potential partner may also make a proposal to start negotiations. The initiator of such negotiations should provide a statement of reasons underlying the FTZ Agreement. Having received the aforementioned statement, the EEC makes an expert assessment and collects the opinions of the Union Member States. If all members agree that the prospects of the Agreement are interesting, they form a joint research group (JRS) comprising the representatives of the EAEU countries, the EEC, and the interested partner.

The work carried out by the research group is the preparation for negotiations; here, ex-perts study the economies of the Parties and the parameters of their external and mutual trade, and search for the areas which are of mutual interest for the participants, and develop a draft scheme of future arrangements. Following the results of its work, JRS presents a detailed report about the feasibility of negotiations regarding the free trade zone (FTZ).

On the basis of this report, the Presidents of the EAEU Member States decide on the launch of negotiations. If the decision is positive, the EEC Council approves the Directives for negotiations at the level of vice prime ministers. After that, the representatives of the EEC, the EAEU Member States and the future FTZ partner elaborate the text of the Agreement and decide on future obligations and concessions. As a rule, it takes several negotiation rounds.

The negotiation process itself is a good background for the development of mutual trade on a bilateral basis by the participating states. Based on the expected simplification of market access, the entrepreneurs start to actively establish business contacts and elaborate establishing a distribution network in order to be the first ones to take the advantages of the free trade.

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The Asia-Pacific Region

Vietnam

In world practice, the conclusion of agreements on the establish- ment of free trade zones (FTZ) continues to be an effective tool to promote bilateral and multi- lateral cooperation in the field of trade and economic relations and investments.

Until 2014, the only free trade zone involving all the Union coun- tries simultaneously was the free trade zone of the CIS. Veronika Nikishina, the Member of the Trade Board (Minister in charge) of In May, 2015, the EAEU conclud- the EEC and Chang Tuan Anh, the Minister of Industry and Trade of Vietnam, ed its first full-scale free trade signing the Protocol of the results after the 1st Session of the Joint Committee agreement with a state of the under the Free trade zone agreement between the EAEU and the Socialist Asia-Pacific Region – Vietnam. Republic of Vietnam. June 29, 2017. Negotiations with Vietnam started in 2013. The EAEU delegation led by the EEC Minister in charge of of import customs duties. Cus- the involvement and interest of Trade held eight rounds of talks, toms-free access to the Vietnam- entrepreneurs in maintaining and and on May 29, 2015, in Burabay ese market will also open the door developing the mutually beneficial village, Kazakhstan, an Agree- to the export of goods which were cooperation. In view of this, the ment at the level of the Chairmen not supplied earlier due to higher easing of trade procedures and of the Governments of the EAEU price, including due to quite high elimination of barriers is a logical and Vietnam and the Chairman customs duties. and consistent decision. of the EEC Board was signed. After completion of the necessary Immediately after the Agreement The free trade zone agreement procedures, on October 5, 2016, enters into force, Vietnam will between the EAEU and Vietnam the Free Trade Agreement with have to cancel (set to zero) the embraces all areas of trade and Vietnam came into force. import customs duties on more economic cooperation. Apart from than 58% tariff lines of the whole the reduction of import customs Vietnam is an attractive market commodity nomen-clature for the duty rates, the Agreement with a population of about 90 mln suppliers from the Eurasian Eco- establishes the Parties’ obligation people. The agreement with Viet- nomic Union. As regards the other to protect the intellectual property nam opens up new opportunities 30% of the commodities nomen- rights, sets common principles to the EAEU countries. Vietnam is clature, the import customs duty for competition protection, active in developing supply chains rates will be reduced to 0% during sets forth cooperation venues in the Asia-Pacific region. Deeper the transition period. in the area of sus-tainable trade and economic relations with development, e-commerce the partner will enable the manu- The free trade zone between and government procurement. facturers and suppliers from the the EAEU and Vietnam was not The Agreement significantly Union countries to get access to created from scratch. Our coun- increases the predictability of the established supply channels tries have been involved in mu- trade regulations and creates in the Asia-Pacific Region. Fur- tually beneficial cooperation for conditions for the increase and thermore, the products supplied many years. Mutual trade has diversification of trade turnover to Vietnamese market will be been growing recently – from in the framework of the free more competitive in terms of price 2.6 bln USD in 2010 to 4.27 trade zone. This document also due to reduction or cancellation bln USD in 2015, which proves provides for “safety” mechanisms

61 Eurasian Economic Integration: Facts and Figures

against unfair competition and uncontrolled growth of imports.

It also provides for obligations in terms of the mutual liberalisation of trade in services, investment execution and movement of individuals. Initially, they apply to relations between Russia and Vietnam only. However, other countries of the Union also have the opportunity to join them later.

On October 5, 2016 after the completion of all ratification pro- cedures, the Agreement entered into force.

China Meeting of Tigran Sargsyan, the Chairman of the Board of the Eurasian Economic Commission with Zhang Gaoli, the First Vice-Premier of the PRC State Council The Eurasian Economic Commis- sion is actively cooperating with the authorities of one of the major ciently and improve conditions for of Trade Veronica Nikishina and the trading partners of the Union – the control over the import of Chinese Chinese Minister of Commerce Gao People’s Republic of China. In goods to the EAEU Member States, Hucheng signed a joint statement 2012, two Memoranda of Cooper- as well as their transit through the on the transition to the negotiation ation were signed with the Chinese common customs territory of the stage of the Agreement develop- Ministry of Commerce: on trade Union. Information exchange will ment. and cooperation in the field of promote trade in good faith and anti-dumping, countervailing and have a beneficial impact on the The goal of the Agreement is safeguard measures. overall economic situation of the provision of complex interaction Member States. of the Union as a subject of the In 2013-2014, due to regular world economy with the PRC on expert consultations, the Parties In May 2015, the Presidents of the trade regulations, trade facilita- managed to settle some disput- Member States of the Eurasian tion to promote cooperation, and able mutual trade issues at the Economic Union decided to start ensuring operation of the devel- initial stage. Furthermore, the negotiations with China on con- oped cooperation institutions on interests of both manufacturers clusion of an agreement on trade a broad cooperation agenda. The from the Union countries and and economic cooperation. This Agreement does not provide for the Chinese exporters were taken into is an important stage sequencing liberalization of customs duties in account. the entire structure of relations mutual trade. and providing a basis for further Since 2012, the Commission has progress in the area of trade A new impetus to the deepening been working on the arrangement simplification and elimination of of cooperation between the EAEU of information exchange with the non-tariff barriers that restrict and the PRC was given with the People’s Republic of China. The reciprocal access to markets. visit of the Chairman of the Board PRC has been chosen as a “pi- In addition, in October 2015 the of the Eurasian Economic Com- lot” partner due to its greatest Presidents adopted a disposition mission Tigran Sargsyan to China share in foreign trade turnover of on coordination of activities of the in August 2016, where he met the Eurasian Economic Union. EAEU Member States on con- with the First Vice Prime Minis- The Agreement on information junction of the Eurasian Economic ter of the State Council of China exchange between the customs Union and the Silk Road Econom- Zhang Gaoli. bodies of the EAEU Member States ic Belt. and the People’s Republic of China On the suggestion of Zhang Gaoli, will enable monitoring of the flow Formal negotiations started in the the Parties, inter alia, agreed to of goods crossing the customs first half of 2016. In June this year in work on the creation of a “data borders of the Union more effi- Beijing, the EEC Minister in charge bank” in respect of projects

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is expected. Based on the work conducted, at the session of the Supreme Eurasian Economic Council in December 2016, it was decided to launch negotiations on concluding a Free Trade Agree- ment with India. In June 2017, within the framework of the St. Petersburg International Econom- ic Forum, a joint statement on launching negotiations was signed with the Indian partners at the ministerial level. Delegations of the EAEU and India will hold the first negotiating round after completion of the necessary internal proce- dures.

Mongolia

In June, 2015, in order to pro- Tigran Sargsyan, the Chairman of the EEC Board and Narendra Modi, the mote comprehensive coopera- Prime Minister of India, discussing the prospects for an agreement on Free tion between the EAEU Member trade zone between the EAEU and India under the St. Petersburg International States and Mongolia, to increase Economic Forum. June 2, 2017. the efficiency of mutual trade and implement measures aimed of common interest for China and the Union Member States. The negotiation process on the conclusion of an Agreement on information exchange on goods and vehicles of international transportation moved across the customs border of the EAEU and China is underway. Regular exchange of data on goods that are moved from the PRC to the EAU and vice versa will increase the level of trust between the countries participating in the Agreement, will help reduce the supply of counterfeit products, as well as accelerate the commission of customs operations and customs control.

India In 2015-2016, the joint research group completed its work on the investigation of the feasibility of entering into a Free Trade Area Agreement with India. The results of the investigation showed the June 2, 2017 – At the meeting of Tigran Sargsyan, Chairman of the Board of the prospect of transition to the free Eurasian Economic Commission with Jargaltulgyn Erdenebat, the Prime Minister trade regime – an increase of of Mongolia, within the framework of the St. Petersburg International Economic 18% in both imports and exports Forum, the parties demonstrated their commitment to enhance cooperation. 63 Eurasian Economic Integration: Facts and Figures

at eliminating barriers to trade, During the end of 2016 – early (Cambodia), and the first session a Memorandum on Cooperation 2017 in Moscow, Seoul and Minsk, of the joint Working Group estab- between the EEC and the Govern- a number of consultations were lished to implement the Memoran- ment of Mongolia was signed. held at the official level, where the dum was held. most mutually beneficial formats In order to implement the Mem- for deepening cooperation were Singapore orandum, two sessions of the discussed.Their results will be Working Group were held. The reported to the Council of the Eur- In 2015, a dialogue was initiated plan of joint actions of the Work- asian Economic Commission for between the Commission and the ing Group for 2017–2018 is being taking a decision on further steps Government of the Republic of implemented. Cooperation on in order to qualitatively increase Singapore, for which the format of issues of technical regulation is and diversify mutual trade and the Memorandum of Understand- being deepened. investment. ing was chosen as the first stage. The document was signed during The Republic of Korea Cambodia the meeting of the Chairman of the EEC Board, Tigran Sargsyan, with The EEC is developing coopera- In May 2016, during a meeting of the Prime Minister of the Republic tion with such a large and indus- the Chairman of the EEC Board, of Singapore, Lee Hsien Loong, in trialized economy as the Republic Tigran Sargsyan, with the Prime May 2016. of Korea, too. A Memorandum of Minister of the Kingdom of Cambo- Understanding between the Com- dia, Hung Sen, a Memorandum of Also, the track of cooperation mission and the Government Pro- Understanding between the Com- between the EAEU and Singapore curement Service of the Republic mission and the Government of the on the creation of a free trade area of Korea was signed in October Kingdom of Cambodia was signed. was developed. The joint research 2015. The document provides for group started its work on the inves- the exchange of experience in In February 2017, a regular meet- tigation of the feasibility of entering regulation of government pro- ing of Tigran Sargsyan with Hung into a Free Trade Area Agreement curement in general and improve- Sen was held in Phnom Penh by the parties. ment of e-procurement system in particular.

In addition, on November 30, 2015, a Memorandum of Coop- eration between the Eurasian Economic Commission and the Ministry of Industry, Trade and En- ergy of the Republic of Korea was signed on a wide range of trade cooperation.

In September 2016, the joint team of academics of the EAEU coun- tries and the Republic of Korea completed its work. It was pre- viously established to determine the optimal format for deepening economic and trade cooperation between the partners. The results of its work were considered at a specialized seminar held at the level of the Member of the Board – Tigran Sargsyan, the Chairman of the EEC Board and Samdech Akka Moha Minister in charge of Trade of the Sena Padey Techo Hun Sen, the Prime Minister of the Kingdom of Cambodia EEC and the Deputy Ministers of signing the Memorandum of Understanding between the EEC and the Kingdom the EAEU countries and Korea. of Cambodia

64 1H 2017 Eurasian Economic Commission

ASEAN The Commission is working to establish cooperation with the ASEAN.

In 2014, the meeting of the Chairman of the EEC Board, Victor Khristenko, with the Secre- tary-General of ASEAN Le Luong Minh was held in Moscow.

In 2014, the Minister of Trade of the EEC for the first time partic- ipated in the discussion of the economic agenda of the Rus- sia-ASEAN dialogue. In 2015, the EEC successfully participated in a business forum with the ASEAN, which resulted in identifying real interest of the regional business in the EAEU market.

Tigran Sargsyan, the Chairman of the EEC Board and Lee On May 19, 2016 in Sochi, the Hsien Loong, the Prime Minister of the Republic of Singapore signing the EEC Board Chairman Tigran Memorandum of Understanding between the EAEU and Singapore Sargsyan, at a plenary session of Russia – ASEAN Business Forum “Russia – ASEAN Partnership in APEC launch of the Joint Strategic Study the new integration architecture of to Assess the Economic Feasibility the Asia-Pacific Region: business One of the EAEU Member States – of FRZAPR. opportunities”, stated the need to the Russian Federation – is a develop cooperation between the member of the APEC Economies The results of the Joint Strategic Commission and the ASEAN. In his Forum. The Forum pays great Study and the results of the dis- opinion, one of the most effective attention to the improvement of cussion on the FRZAPR by the formats of cooperation could be the trade regulation and represents leaders of economies of the Forum exchange of information on matters a sort of an “incubator” of ideas, in 2016 are of “substantive” interest of interest to the business in trade, which, if successfully tested for the Union, taking into account technical regulations, customs by individual APEC member the location of Eurasian integration regulations and barriers reduction. economies, are available for association between Europe and The ASEAN Secretary General Le large-scale implementation in the the Asia-Pacific Region, as well as Luong Minh also called for further framework of the multilateral trade plans for the EAEU on establishing strengthening of relations between system. FTZs with the individual economies the business communities of the of the Forum. In the case of imple- Member States of the associations. On the platform of the Forum, mentation of the FRZAPR in the The issue of institutionalization of the participants also discussed foreseeable future, the Union will pay the cooperation between the Com- the possibility of establishing the special attention to the solutions that mission and the ASEAN Secretariat APEC free trade zone (FRZAPR). are offered by FRZAPR in respect of is being worked over. The initiative on the FRZAPR was trade simplification and facilitation, enshrined in the Bogor Goals in efficiency of industrial cooperation at In May 2016, the Eurasian Eco- 1994. However, the discussion in the regional level and other initiatives nomic Commission signed the this area has advanced thanks to aimed at improving the competitive- Memorandum of Understanding the initiatives of China in 2014. One ness of goods and services pro- with the Government of the King- of the activities directions was the duced in the region. dom of Cambodia.

65 Eurasian Economic Integration: Facts and Figures

The Middle East the unification of the trade regime ing 2017 were held with Serbian with Serbia. Belarus, Kazakhstan partners. On October 16, 2015 at the session and Russia already have bilat- of the Supreme Eurasian Economic eral free trade agreements with The Latin America Council in Burabai village, Kazakh- Serbia. However, Armenia and stan, based on the report of the Joint Kyrgyzstan have not signed such The governmental and business Research Group, it was decided to agreements. In September and circles of Latin American coun- launch negotiations on the conclu- December 2016, consultations on tries have shown a high interest sion of a Free Trade Area Agreement preparations for the direct nego- in the processes of the Eurasian with Israel. The first round of negotia- tiations that will take place dur- economic integration and the op- tions was held in November 2016.

In December 2016, the Supreme Eurasian Economic Council decided to start negotiations with Egypt on the conclusion of a free trade agree- ment, and with Iran on the conclu- sion of an interim agreement leading to the formation of a free trade area.

The work is concluding on the preparation of the Memorandum of Cooperation with the Hashemite Kingdom of Jordan. The document is expected to be signed in the autumn of 2017.

Serbia

Veronika Nikishina, the Member of the Trade Board (Minister in charge) of the Based on the decision of the Su- EEC and Paulina Nazal, the Deputy Minister of Trade of Chile, discussing the de- preme Eurasian Economic Coun- velopment of trade and economic cooperation between the states of the EAEU and cil, negotiations were initiated on Chile, including the prospect for an agreement on Free trade zone. July 25, 2017.

portunities they open for business in terms of entering the common market of the EAEU. There is a demand for deeper and more systematic interaction with the Commission. Memoranda of Co- operation between the Commis- sion and the Governments of the Republic of Chile and the Repub- lic of Peru were signed, sessions of joint working groups were held to implement the Memoranda.

The United Mexican States, the Republic of Cuba, the Argentine Republic, the Federative Republic Tatyana Valovaya, the Member of the Integration and Macroeconomics of Brazil also express interest in Board (Minister in charge) and Berta Pensado Moreno, the Extraordinary expanding trade and economic and Plenipotentiary Ambassador of the United Mexican States to the Russian relations with the Member States Federation, discussing the prospects for cooperation between the EAEU and of the Union and establishing direct Mexico. July 18, 2017. contacts with the Commission. 66 1H 2017 Eurasian Economic Commission

The Commission actively interacts with European business circles, influential European centres and the expert community.

Focused efforts are made to establish direct contacts between the Commission and the European Commission.

International organizations

The EEC is also actively cooper- ating with international organiza- tions and institutions regarding the international activities of the Eurasian Economic Union.

The organizations, with which Business meeting of Tigran Sargsyan, the Chairman of the Board of the the Commission conducts Eurasian Economic Commission with Susana Malcorra, the Minister of Foreign a dialogue, include: The Affairs of Argentina on April 12, 2016. United Nations Conference on Trade and Development (UNCTAD), the United Nations Cooperation with regional as- the EU’s share in the Union for- Industrial Development sociations of Latin America is eign trade accounted for 46.5% Organization (UNIDO), the UN developing. In February 2017, a of foreign trade turnover of the Economic Commission for Memorandum of Understanding EAEU with third countries. Europe (UNECE), the United was signed between the EEC Nations Economic and Social and the General Secretariat of In the bilateral format, work Commission for Asia and the the Andean Community. Memo- is being conducted with Pacific (ESCAP), United Nations randa with the South American European states that show Centre for Trade Facilitation and Common Market (MERCOSUR), interest in cooperation with the Electronic Business (CEFACT), the Caribbean Community Union: the Slovak Republic, the United Nations Commission (CARICOM), the Association the Czech Republic, the Italian on International Trade Law of Caribbean States, the Latin Republic, and others. (UNCITRAL), the UN Food and American Integration Association Agriculture Organization (FAO), (LAIA) and the format of interac- On June 24, 2017, the Joint the World Trade Organization tion with the Pacific alliance are Declaration of Cooperation (WTO), the Shanghai being worked out. between the Eurasian Cooperation Organization (SCO), Economic Commission the World Health Organization and the Government of the (WHO), the International The EU Hellenic Republic was signed. Labour Organization (ILO), the This is the first document Organisation for Economic One of the priorities of the Eur- institutionalizing cooperation Cooperation and Development asian Economic Commission between the EEC and the (OECD), the International is development of cooperation government of an EU member Monetary Fund (IMF), the World between the Eurasian Economic state. The Declaration provides Bank (WB), the World Customs Union and the European Union. for cooperation on a broad Organization (WCO), Eurostat, The urgency of such a dialogue economic agenda, taking into the European and Mediterranean is due to the fact that the Euro- account the competence of Organization for Plant Protection pean Union is the major trade the EEC and the obligations of (EPPO), the International and economic partner of the Greece arising from the law of Organization for Migration EAEU. Thus, by the end of 2016 the European Union. (IOM), the International Aviation

67 Eurasian Economic Integration: Facts and Figures

Committee (IAC), the International Health (OIE), the International The main aim of the Commis- Road Transport Union (IRU), the Union of Railways (UIC), the sion’s work in this direction Organization for Cooperation of Coordinating Council on Trans- is the use of experience and Railways (OSJD), the International Siberian Transportation (CCTT), best global practices of inter- Civil Aviation Organization (ICAO), World Intellectual Property national organizations to meet the International Air Transport Organisation (WIPO). the challenges of the Eurasian Association (IATA), the Secretariat Economic Union. Most tracks of the International Plant In 2014, the EEC was granted are based on memoranda on Protection Convention (IPPC), the a permanent observer status to interaction, cooperation and World Organization for Animal WIPO. understanding.

Meeting the obligations by the EAEU Member States in relation to the WTO at the supra- national level

The law of the Union, as well This Agreement has become an To ensure the application by as the preceding law of the integral part of the Treaty on the Kazakhstan of the exemptions Customs Union and the Com- Eurasian Economic Union. from the CCT within the EAEU, in mon Economic Space, was October 2015, the Heads of the formed in accordance with Considering almost similar Member States signed the Protocol the rules and principles of obligations of Kazakhstan and on certain matters of entry and the World Trade Organization Russia to the WTO (with the circulation of goods in the customs (WTO). exception of tariff concessions), territory of the Eurasian Economic alterations to the Treaty on the Union. The Protocol provides for After joining the WTO by one EAEU after accession of the the ability for Kazakh foreign trade of the CU and CES Member Republic of Kazakhstan to the operators to import goods, Kazakh- State – the Russian Federation – organization were not required. In stan’s tariff bindings for which are the Agreement on operation of respect of tariff bindings, taking into below the CCT, either under the the Customs Union within the account the significant number of WTO rates, or the CCT rates. multilateral trade system was positions, on which Kazakhstan’s signed that provided for assurance bindings are below the bindings Whereby, it is agreed that the of compliance of the CU with not specified by the Russian goods imported using the WTO only the basic principles of the Federation, the EAEU Member rates should be used only for WTO, but with the commitment States have made a joint decision consumption in the Republic of of individual member states of the not to incorporate the bindings Kazakhstan and shall not be freely association. Thus, the Common of Kazakhstan in the Common circulated throughout the Union. Customs Tariff of the Customs Customs Tariff, but to provide for Exemptions to the CCT allowed Union (CU CCT) has been aligned exemptions from it for the Kazakh Kazakhstan to fully meet its with the tariff bindings of Russia. party. commitments in the World Trade

68 1H 2017 Eurasian Economic Commission

Organization until Kazakhstan’s of the GATT, procedures for the of customs regulations in the commitments are not revised revision of tariff commitments Eurasian Economic Union. following negotiations in the WTO. of the two countries in the WTO In addition, exemptions to the were initiated. At the Union level, Within the framework of the CCT retained a higher level of tariff the decisions were made on Union, the work to optimize the protection of the Union as a whole. the establishment of common internal interaction of the Member negotiating delegations on the States and the Commission In 2015, the Republic of Armenia revision of tariff commitments with on specific matters related to and the Kyrgyz Republic, which the participation of representatives the WTO is carried out. The have a longer history of the of all the Member States and the Procedure for interaction between membership in the WTO, joined the Commission in each of them. the Members States of the Union. Given the earlier accession Eurasian Economic Union and the of Armenia and Kyrgyzstan to the Today, the EEC ensures Eurasian Economic Commission WTO as compared to Russia or that the measures taken on international trade disputes Kazakhstan, commitments of these in the field of foreign trade with third parties was adopted. countries did not go beyond the regulation (anti-dumping, The document specifies the basic commitments under the WTO countervailing and special issues of interaction on possible Agreement. The incorporation of protection measures, disputes, including against any these commitments into the Union sanitary and phytosanitary of the Member States in the law was considered as inexpedient. requirements, technical framework of the WTO under the regulations and other regulation measure of the Union. The relevant provisions are measures) are compliant enshrined in the treaties on with the rules and of the The Procedure for interaction accession of the Republic of Ar- WTO. of the Member States of the menia and the Kyrgyz Republic Eurasian Economic Union and the to the Treaty on the Eurasian Issues discussed in the WTO Eurasian Economic Commission Economic Union. Moreover, from and related to the area of the on the preparation of draft the date of accession to the Union, EAEU regulation are reviewed at notifications for submission to the Armenian and Kyrgyz parties the platform of the Commission. the World Trade Organisation began to apply the Common Thus, the EEC conducted an has been developed and is Customs Tariff that is allowed by analysis of the WTO Agreement under approval. The purpose the WTO (Article XXIV of the GATT) on Trade Facilitation, which was of this document is to ensure in the case of joining the Customs agreed by the WTO members the timely and consistent Union by an organization member. by the end of 2013 and adopted submission of notifications to In order to ensure compliance by the decision of the General the WTO on the Union regulation by Armenia and Kyrgyzstan with Council of the WTO in November measures envisaged under the its commitments to the WTO, in 2014. Its provisions will be taken commitments to ensure the accordance with Article XXVIII into account in the improvement transparency of trade regulation.

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Integration Segment of Economies of the eaeu Member States

The contractual legal framework of the Eurasian economic integration. Key Documents

Integration potential means THE CUSTOMS UNION Union territory. In accordance with additional opportunities for the law, the EEC gained the power economic development of 2010 to control the compliance with the the Union countries due to competition rules in the most efficient use of The Customs Code of the transboundary markets on the resources, diversification of Customs Union territory of the Customs Union (the EAEU) countries economies, implementation Transfer to the CU Commission of of transport, including powers to implement the foreign The Agreement on information transit potential, trade regulation (the power to cooperation in statistics in order to development of competitive change rates of import customs provide the EEC and the Union environment, financial duties, introduction of the Foreign countries with the official statistical markets and improving the Economic Activity Commodity information necessary to carry out business climate, Nomenclature, establishment of their activities and monitor the development of common tariff preferences and tariff quotas, implementation of international determination of tariff preference treaties that are the legal guidelines of system, introduction of non-tariff framework of the CU (the EAEU) macroeconomic policies regulation) and establishment of The Agreement on the procedure effective working common Investigation and other of movement of narcotic drugs, market of goods, services, procedural actions prior to the psychotropic substances and capital, and labour. introduction of safeguard, their precursors on the Customs anti-dumping and compensatory Territory of the Customs Union measures in the common customs territory of the Customs THE EURASIAN Union in respect of goods ECONOMIC UNION originating from foreign countries

COMMON ECONOMIC 2015 SPACE The Treaty on the EAEU 2012 The Program of stage-by-stage liberalization of the performance 17 basic international by carriers of cabotage road agreements introducing the transportation of cargoes Common Economic Space The Agreement on coordination of activities on protection of 2013 intellectual property rights Model Law “On Competition” that defines a common approach 2016 to the basic provisions of the Competition Law in the CU The Agreement on exchange of countries (the EAEU) with the aim information, including confidential, of convergence of legal in the financial sector in order to regulation of economic relations create conditions for free capital in competition policy on the flow in the financial markets 70 70 1H 2017 Eurasian Economic Commission

The contractual legal framework of the Eurasian economic integration. Key Documents

The Agreements on the tax policy The Agreements on the tax The Agreement on the audit principles in respect of excise policy principles in respect of activity on the territory of the duties on alcohol and tobacco excise duties on alcohol and EAEU products in the EAEU Member tobacco products in the EAEU States Member States The Agreement on informa- tion exchange in the area of The Agreement on joint control The Agreement on coordinated counteraction to legalisa- activities on compliance with the approaches to the regulation of tion (laundering) of the Procedure for transfer and distri- currency relations and meas- proceeds of crime and bution of import customs duties ures of liberalisation terrorist financing in the (other duties, taxes and fees movement of cash and (or) having equivalent effect) and their The Treaty on trademarks, monetary funds across the transfer to the budgets of the service marks and appellations customs border of the EAEU Member States of origin of EAEU goods EAEU

Main Directions and stages of The Agreement on the procedure The Agreements on the implementation of the coordinated of managing copyright and procedure and conditions (agreed) transport policy related rights on a collective basis for elimination of technical The Amendments to the Treaty barriers in mutual trade with The Agreement on the Methodolo- third countries gy for the formation of indicative on the EAEU in respect of the (forecast) balances of gas, oil and principle of exhaustion of the The Agreement on the oil products within the EAEU exclusive right to the trademark, procedure for circulation of the trademark of the Union products within the EAEU, 2017 The Agreement on the requirements for which are procedure for voluntary not established by the The Agreement on shipping harmonization by the EAEU EAEU technical regulations, and the rules The Agreement on Harmoniza- countries with the Commission of specific subsidies for for ensuring the safety of tion of the Laws of the Member such products States of the Eurasian Economic industrial goods and Union in the Area of the Financial conducting by the EEC of The Agreement on the Market proceedings related to the principles and approaches provision by the Union Member for conducting state control The Agreement on Admission of States of specific subsidies (supervision) of compliance Brokers and Dealers of one with the requirements of Member State of the EAEU to 2018 the EAEU technical Stock Exchanges (Market Opera- regulations in order to tor) of other Member States The Concept of developing harmonize the laws of the a common financial market EAEU Member States in The Customs Code of this area the Eurasian Economic Union The Agreement on regulation of the alcohol market within The Agreement on The Protocol on exchange of the EAEU Cooperation between the information in electronic form Memeber States of the between tax authorities of the The Pension Agreement of EAEU in exchange of the EAEU Member States for tax workers and their families within data in credit records administration the EAEU countries 71 71 Eurasian Economic Integration: Facts and Figures

Single and common markets of the EAEU Agreed (coordinated) policies of the EAEU

The Customs The Common The Eurasian Union Economic Space Economic Union

2015

The single services market of the EAEU

Agreed intellectual property policy

Agreed policy for consumer protection policy

The common labour market of the EAEU

Agreed labour migration policy

Agreed policy for ensuring uniformity of measurements

Main Directions of Industrial Cooperation within the EAEU 2012 Agreed policy in the application of sanitary, The agreed policy veterinary and phytosanitary quarantine in technical measures 2010 regulations The Agreement on Procedure for Confidential Information Agreed Protection and Liability for its Disclosure in the macroeconomic Implementation by the EEC of the Powers to Control policy Compliance with the General Rules of Competition entered into force. Common customs regulation

Agreed monetary policy

Agreed industrial policy

The EAEU coordinated industrial policy

Decision of the Supreme Eurasian Economic Council of the EEC transferred powers to monitor compliance with uniform rules on competition in the transboundary markets.

The common The Model Law «On Competition» is adopted market of goods of the CU 2013 2011

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2025

2019 The common oil and oil products 2017 market of the EAEU The common Creating a common electricity market of The common system of access to the the EAEU financial market of state (municipal) the EAEU Creation of the EAEU procurement in the EAEU common industry made in electronic format The common gas information system market of the EAEU The common medicines market of the EAEU The common market of transport The common market for services of the medical products of the EAEU. EAEU

The common market of excisable goods (alcohol and tobacco Harmonization of the legislation products) of the EAEU of the EAEU Member States in respect of administrative and The main directions and criminal liability for violations in stages of the transport the field of competition agreed (coordinated) policy

2020

2018

2016

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Four “freedoms” in the EAEU

The aspiration to introduce a single market for goods, services, capital and labour is one of the main objectives of the Union enshrined in Article 4 of the Treaty.

2011 2015 2025

Customs Union Eurasian Economic Union

• the right to receive free emergency medical care; THE Common 2. Economic Space • the right of children to education. The single services 1. market – free movement of services 4. Start of operation for 43 services sectors from 2015. Till The single market of 2025 a transitional period for 21 goods – free movement of The common financial service sectors is fixed with the goods market – free movement indication of a concrete date of of capital Removal of customs controls transition to the status of the at internal borders between single market for each sector. The common financial market Belarus, Kazakhstan and implies: Russia. • harmonised requirements for the regulation and 3. supervision in the sphere of financial markets of the Member States; The common labour • mutual recognition of market – free movement of licenses in the banking labour and insurance sectors, as well as in the service Ensuring the right of citizens of sector in the market of the Union to work in any securities; Member State of the Union without any a permit. • conducting activities to provide financial services The common labour market on the entire territory of implies: the Union without the • direct recognition of establishment of a legal education documents; entity; • settling issues in respect of • administrative cooperation periods for temporary stay between authorised of citizens; authorities of the Member States, including through • providing a full scope of exchange of information. social guarantees;

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Contact Information of the Eurasian Economic Commission

Chairman of the Board Member of the Board – Minister in charge of Tigran Sargsyan Customs Cooperation Reception tel.: +7 495 669 24 44 Mukay Kadyrkulov Reception tel.: +7 495 249 25 00 Member of the Board – Minister in charge of the Development of Integration and Macroeconomics Member of the Board – Minister in charge of Tatyana Valovaya Energy and Infrastructure Reception tel.: +7 495 669 24 06 Adamkul Zhunusov Reception tel.: +7 495 249 25 25 Member of the Board – Minister in charge of Economy and Financial Policy Member of the Board – Minister in charge Timur Zhaksylykov of Competition and Antitrust Regulation Reception tel.: +7 495 669 24 07 Marat Kusainov Reception tel.: +7 495 669 24 14 Member of the Board – Minister in charge of Industry and Agriculture Member of the Board – Minister in charge of Sergey Sidorskiy Internal Markets, Information Support, Information Reception tel.: +7 495 669 24 08 & Communication Technologies Karine Minasyan Member of the Board – Reception tel.: +7 495 669 25 55 Minister in charge of Trade Veronika Nikishina Reception tel.: +7 495 669 24 09

Member of the Board – Minister in charge of Technical Regulations Valery Koreshkov Reception tel.: +7 495 669 24 11

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Press office of the Eurasian Economic Commission e-mail: [email protected] Telephone: +7 495 669 24 64

Website of the Eurasian Economic Union www.eaeunion.org

The Eurasian Economic Commission website www.eurasiancommission.org

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