Posted by Zee Kleshchar on Nov 14, 2011 in Customs Sector, News & Updates, Policy Wins & Progresses | 0 comments
From the very first day in office President Yanukovych’s team got busy with introducing new pieces of legislation, consolidating separate documents into compelling codes and putting in order lawmaking in Ukraine. Every businessman knows that a comprehensive system of legislation is one of the key pillars of competiveness for every country and therefore the American Chamber of Commerce in Ukraine has been actively working on transforming the existing regulatory system into a better one bringing it closer to EU and international standards. In many ways this effort has brought positive changes and the recently adopted Customs Code of Ukraine is a good example of our joint work.
The Draft Law #8130-д “On Amendments to the Customs Code of Ukraine and Certain Other Legislative Acts of Ukraine” was submitted to Verkhovna Rada’s Agenda in the beginning of September and adopted on November 3rd. A total of 274 Peoples’ Deputies out of 394 registered in the Parliament’s session hall that Thursday voted for adopting the document in the second reading as well as in general.
The majority of the international companies operating in Ukraine mostly anticipated the changes in the procedures of evaluating customs value, customs post-entry audits and appeal procedures, declaration of goods and modernization of customs regimes. These issues were of the main focus for the American Chamber of Commerce’s Customs Committee and so we actively advocated for them. One of the Chamber Customs Committee leaders – Igor Dankov, Senior Manager at PwC, kindly provided us with an extensive legal overview and evaluation after the Customs Code of Ukraine came out. So let’s take a look at what this new Code will bring us.
On the positive side – new legislation simplifies the procedures for customs registration of goods, gives the priority for electronic declarations, and brings the overall customs regulations closer to international practices opening the door to new opportunities for the participants of foreign economic activities.
Current legislation states that registration of goods is limited to the specific customs authority (depending on the registration office), but if the law to be enforced any customs authority can provide the registration and therefore ease the procedure and save a lot of time. Plus, one of the norms envisages that entire registration – from the moment of goods’ submission and filling out the declaration – will take only 4 hours. Top that with legal grounds for the “single window” concept – all documentation can be submitted to one customs authority, as well as introduction of the customs authorities’ responsibility for damaging goods and you will see the new Code in a bright light.
Of course there are some tricky norms that business needs to be aware of. For example, new legislation foresees improvements in the inspection activities. This can be a good thing unless such improvements will strive to increase fiscal pressure which of course is not that good. Additionally, the prior declaring conception is far from being perfect and misses vital mechanisms to become functional. Even though the “single window” concept is quite promising the new Code leaves the Customs Service with a right to determine a specific registration authorities for certain types of goods.
To sum up, the new Customs Code is truly a step in the right direction and even if the President signs it without amending this piece of legislation still will prove the ability of government to work closely with the business community creating comprehensive laws. The question remains how this regulatory framework will be implemented in action but in this regard the only advice to business is to demand the execution of the norms because otherwise the way things are done will not change.
The Customs Code of Ukraine, if signed by President Yanukovych, comes into force on January 1, 2012, except for several specific clauses which are to be subject of our further discussion.