The Republic of Belarus uses three types of trade regimes in the trade and economic relations with other countries.
Free Trade Regime / free trade zone
The free trade regime is one of the most effective forms of international economic integration. Establishment of this regime is carried out on a contractual basis between the states having a rather high level of trade, economic and political cooperation.
The free trade regime provides for the abolishment of tariffs and quantitative restrictions in bilateral trade. Exemptions from the free trade regime are possible for extra sensitive products.
There are bilateral governmental agreements within CIS on free trade currently in force with Azerbaijan, Armenia, Kyrgyzstan, Tajikistan, Kazakhstan, Moldova, Russia, Uzbekistan, Turkmenistan and Ukraine.
Belarus is also a member of the CIS Agreement on free trade area signed on April 15, 1994 (with alterations of April 2, 1999). In accordance with the Agreement, free trade regime also applies to trade with Georgia.
The CIS Treaty on free trade area signed on October 18, 2011 will replace the 1994 Agreement.
The main provisions of the new Treaty are based on the rules and principles of the World Trade Organization. Apart from issues of abolition of import and export customs duties and quantitative restrictions free trade area in accordance with the Treaty provides:
• national treatment in respect of internal taxes and regulation;
• national treatment in respect of government procurements;
• freedom of transit;
• application of technical measures, as well as sanitary and phytosanitary measures, on the basis of the relevant regulations of the World Trade Organization;
• regulation of granting subsides;
• regulation of application of anti-dumping, countervailing and safeguard measures in mutual trade.
Products are free traded in the customs territory of the states – participants of the Treaty in accordance with section 5 of the Agreement on the rules for determining the country of origin of goods in the Commonwealth of Independent States signed on November 20, 2009.
Within the framework of the Customs Union of Belarus, Kazakhstan and Russia the work has begun towards harmonizing trade regimes with third countries. As of today unified trade regimes have been agreed with Serbia. Unified trade regimes are almost agreed with Montenegro.
Some states have expressed interest in establishing a preferential trade regime (a free trade regime) with the Customs Union, for example, members of the European Free Trade Association (Norway, Switzerland, Iceland and Liechtenstein), New Zealand, Vietnam and other countries.
In November 2010 the negotiations with the EFTA countries were officially launched. Seven rounds of consultations have been conducted with EFTA.
Seven rounds of consultations have been conducted with New Zealand.
The 1st round of negotiations on the conclusion of the free trade agreement between Member States of the Customs Union and the Socialist Republic of Vietnam was held in Hanoi (Vietnam) on March 27-29, 2013.
Most-Favoured-Nation Regime (MFN)
Most-Favoured-Nation treatment means the establishment in international treaties and agreements of provisions, whereby each contracting party must provide to the other party the equally favourable conditions in the field of economic, trade and other relations as it would do to any third state. MFN is exercised on a reciprocal basis through the conclusion of multilateral and bilateral treaties.
The MFN-treated countries for Belarus are listed in Appendix 3 of Presidential Decree of December, 31, 2007 ¹ 699 «On the establishment of import duties».
In trade with countries that are provided with MFN the rates approved by the unified customs tariff of the Customs Union are applied.
Preferential Regime (System of Preferences)
Preferential treatment is provided by developed countries unilaterally and encompasses trade preferences to developing and least developed countries on the principles of universality, non-discrimination and non-reciprocity.
A unified system of tariff preferences of the Customs Union applies in connection with the Customs Union of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation to promote the economic development of developing and least developed countries in the customs territory of the Member States of the Customs Union.
According to the Protocol on the unified system of tariff preferences of the Customs Union on December 12, 2008, the Commission of the Customs Union specified a list of users entitled to the unified system of tariff preferences of the Customs Union and a list of goods originating from developing countries and least developed countries in respect of which the import to the customs territory of the Members of the Customs Union provides tariff preferences.
Decision of the Customs Union Commission of November 27, 2009 ¹ 130 «On the unified customs tariff regulation of the Customs Union of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation» approved the following:
List of developing countries — users of the system of tariff preferences of the Customs Union;
List of least developed countries — users of the system of tariff preferences of the Customs Union;
List of goods originating and imported from developing and least developed countries, which are granted import tariff preferences.
According to Article 7 of the Agreement on a unified customs tariff regulation on January 25, 2008, in respect of goods originating from developing countries, users of a unified system of tariff preferences of the Customs Union, and imported into the customs territory included in “the list of goods”, the rates of import duties are 75 per cent of import customs duties of the unified customs tariff of the Customs Union.
In respect of goods originating from least developed countries, entitled to the unified system of tariff preferences, and imported into the customs territory as included in «the list of goods», the rates of import duties are zero.
Tariff preferences are granted only in these cases:
• direct purchase of such products in those countries;
• direct delivery of the products to the common customs territory;
• submission of the declaration of origin in the form of «A» (with the exception of the customs value of shipments, equal or less in cost than 5000 U.S. dollars).