Business news from Ukraine

President of Ukraine signed laws on VAT and duty exemption for copters, thermal imagers, collimators and walkie-talkies

President of Ukraine Volodymyr Zelenskiy has signed laws on VAT and duty exemption for imports of copters, thermal imagers, collimators, radios and night vision devices.
As noted in the cards of the corresponding bills № 8360 and № 8361-d, posted on the website of the Verkhovna Rada, both documents were returned to Parliament with the signature of the head of state on February 22.
At the same time, a member of the faction “Golos” Yaroslav Zheleznyak in his telegram channel reminded that the possibility of preferential imports will also apply to express shipments.
“The laws come into force from the day following the day of its publication. That is, in a couple of days will already work, “- added the parliamentarian.
As it was reported, the Verkhovna Rada on February 6, adopted as a basis and as a whole the draft law № 8360 and № 8361-d on exemption from VAT and import duties of copters, thermal imagers, collimators, radios and night vision devices. On February 13, they were submitted to the president for signature.

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ITC to apply anti-dumping duty of 31.37% to imports of glassware from Belarus

Ukraine’s Interdepartmental Commission on International Trade (ICIT) decided on November 2 to apply a provisional anti-dumping duty of 31.37% to imports into Ukraine of glass containers originating from Belarus, Ilyashev & Partners law firm said on Friday.
“The application of such measures is the result of the Ukrainian government’s timely response to the unfair competition of Belarusian manufacturers in the glassware market in Ukraine and will allow national manufacturers to resume work more quickly to eliminate the consequences of dumping imports of goods,” firm partner Olena Omelchenko said in the release.
“Ilyashev and Partners clarified that they represented the interests of the Association of glass industry enterprises “Glass of Ukraine”, as well as its members.
According to the message, the duty will be charged on the following goods: glass vessels (canning jars, bottles) for food and beverages of 0.15 liters or more, but less than 2.5 liters, which are classified according to the UKTVED by codes 7010 90 41 00, 7010 90 43 00, 7010 90 45 00; colored glass jars of nominal capacity of over 0.33 liter, but less than 1 liter, which are classified according to UKTVED under the code 7010 90 53 00.
This decision is the first decision of the Commission on the application of restrictive measures on imports to Ukraine after February 24, 2022, the law firm said. It has noted that application of provisional anti-dumping measures is an extremely rare interim result in the practice of anti-dumping investigations in Ukraine. The last time such measures were applied by the ICMT was in 2020.
Preliminary antidumping duty is applied for a period of four months and will accrue from the date of publication of the ICMT’s decision in the Uriadovyi Kurier newspaper.
The decision on the violation and anti-dumping investigation based on the results of consideration of the complaint filed by Glass Ukraine, prepared by Ilyashev & Partners, was made by the ICMT on December 22, 2021.
The Association of Glass Industry Enterprises “Glass of Ukraine” is a public organization that unites Ukrainian manufacturers of glass containers, flat glass, glassware, art glass, as well as suppliers of equipment, materials and services for the glass industry. The Association was founded in 1997. Members of the Association produce more than 80% of glass products in the country.

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US SUSPENDS 25% DUTY ON UKRAINIAN STEEL FOR 12 MONTHS

The United States will temporarily suspend the 25% duty on Ukrainian steel imposed by President Trump under Section 232 of the Trade Expansion Act of 1962 for 12 months, U.S. Secretary of Commerce Gina M. Raimondo said.
“For steel mills to continue to be an economic lifeline for the people of Ukraine, they must be able to export their steel. Today’s announcement is a signal to the Ukrainian people that we are committed to helping them stand up in the face of Putin’s aggression,” the minister said on the ministry’s website. .
The report states that each of the 13 Ukrainians is employed in the steel industry of Ukraine, and their work is well paid.
“We are talking about stopping the 25% tariffs imposed in 2018 by the Trump administration,” Yulia Sviridenko, First Deputy Prime Minister and Economy Minister, commented on the decision of the US Department of Commerce.
According to her, the Ministry of Economy has been working on this project for several years.
“The abolition of these duties will be a turning point in trade relations between Ukraine and the United States,” she stressed.
According to the State Statistics Service, in 2021, the export of ferrous metals from Ukraine to the United States increased by 50.5% compared to the previous year – up to $70.76 million, and ferrous metal products – 11 times, up to $16.85 million. In total, these two articles accounted for 55.4% of all exports from Ukraine.
The US Department of Commerce also recalled that some of Ukraine’s largest steel mills have suffered the most from Putin’s barbarism, and Azovstal in Mariupol has become a symbol of Ukraine’s determination to resist Russian aggression. The agency added that many Ukrainian steel mills continued to pay workers, feed and shelter their employees during the fighting, and some resumed production despite nearby fighting.
“Creating export opportunities for these factories is essential to their ability to continue hiring and supporting one of Ukraine’s most important industries,” the statement said.
It also states that following the sanctions, U.S. exports to Russia of categories of goods subject to new U.S. export licensing requirements decreased by 97% in value terms compared to the same period in 2021 (February 24-April 29), and total exports fell by about 79%.

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UKRAINE TO INTRODUCE DUTY ON IMPORT OF WIRES

The Interdepartmental Commission on International Trade (ICIT) published its decision of April 23 this year in the Uriadovy Kurier newspaper on the application of a special duty on the import of wires to Ukraine, regardless of the country of origin for a period of three years: in the first year of the duty application it will be 23.5%, in the second – 22.3% and in the third – 21.2%. According to the announcement, the decision will take effect 30 days after publication. “This case is unprecedented, since the decision of the commission was not published for almost five months due to pressure from some MPs and officials who lobbied for the interests of importers,” Olena Omelchenko, a partner at Ilyashev & Partners, which represented the interests of Ukrainian manufacturers, said, commenting on this publication in a Tuesday release.
According to her, special duties will only apply to interchangeable goods to prevent problems with shortages.
According to the ICIT document, on July 28, 2020, at the initiative of the Odeskabel and Yuzhcable factories (in total, they produce over 50% of these products in Ukraine), the ICIT initiated a special investigation into the import of insulated wires, cables and other insulated electrical conductors to Ukraine, and also fiber optic cables. These are commodity codes according to Ukrainian foreign activity classifier 8544 49 20 00, 8544 49 91 00, 8544 60 10 10 8544 60 10 98, 8544 60 90 10 8544 60 90 90, 8544 70 00 10 8544 70 00 90.
During the investigation period – from the beginning of 2017 to the middle of 2020 – import volumes surged by 128.8%, the share of imports in total production – by 180.4%, in consumption – by 74.8%.
“The growth of imports of goods to Ukraine was due to such unforeseen circumstances as an increase in production, an increase in warehouse stocks and exports of goods from China, an exacerbation of trade tensions between China and the United States, a decline in demand in Belarus, global trends in the development of the renewable energy industry and the introduction of 4G technology,” the commission said.
According to the ICIT, as a result, with an increase in consumption by 30.9%, the volume of domestic production decreased 7.3%, sales fell by 8.6%, sales profit slid by 38.9%, while prices decreased 9.2%, and an increase in production costs by 3% was seen.
According to the State Customs Service, imports to Ukraine under code heading 8544 insulated wire, cable and other insulated electrical conductors, optical fibre cables in the first half of 2021 amounted to 30,200 tonnes by $310.95 million, having increased by 24.6% vs. 44.9%.
The export of these products in January-June-2021 amounted to 40,900 tonnes for $882.6 million, which, respectively, is 40.1% and 57.9% higher than in January-June 2020.
Among the countries from which most of the similar products are imported to Ukraine in monetary terms are Hungary (29.4%), Poland (17.2%), China (9.6%), Romania (11.4%), Czech Republic (7.7%) and Germany (7.4%), while the main countries of export of Ukrainian products are Germany (23.2%), Poland (19.7%), Romania (14.3%) and Hungary (13.8%).
The commission said that duties will not be applied to imports originating from a number of countries, including Iceland, Liechtenstein, Norway, Switzerland, Montenegro, Azerbaijan, Armenia, Kazakhstan, Kyrgyzstan, Moldova, Uzbekistan, Tajikistan, Turkmenistan, Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic.
This list also includes Chad, the Union of the Comoros, Congo, Djibouti, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Republic of Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal , Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Sudan, Timor Leste, Togo, Tuvalu, Uganda, Tanzania, Yemen, Zambia, Brazil, Mexico and Indonesia.
The introduction of duties was supported by the Ukrelektrokabel association, which unites 16 enterprises, including 12 manufacturers of cable products, three manufacturers of basic materials and Ukrainian Research Cable Industry Institute. More than 95% of cables and wires used in Ukraine are annually produced at the facilities of the enterprises belonging to the association, with a total value of more than UAH 3.9 billion per year.
At the same time, the American Chamber of Commerce in Ukraine opposed it. “The potential introduction of additional import duties will actually be an additional tax for the telecommunications industry. This will negatively affect the investment ability of mobile network operators, since they will have to pay additional duties instead of investing in infrastructure,” the American Chamber of Commerce said.

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UKRAINE INTRODUCES SPECIAL DUTY ON IMPORT OF PVC AND POLYETHYLENE

The Interdepartmental Commission on International Trade (ICMT) of Ukraine has introduced a special three-year duty on the import of some types of polyvinyl chloride (PVC) suspension and polyethylene, reducing its rate compared to the preliminary duty from 18% to 12.4% in the first year and again slightly narrowing its application in relation to PVC.
As stated in the announcement in the Uriadovy Kurier newspaper on November 21, the decision of the commission under an application of Karpatnaftokhim LLC (Kalush, Ivano-Frankivsk region) was made on November 20.
In the first decision made on May 22, the special duty was applied to polyethylene with a specific gravity of 0.94 or more, classified by codes 3901 20 10 00, 3901 20 90 00 of tariff heading, and polyvinyl chloride, classified by codes 3904 10 00 00, 3904 21 00 00, 3904 22 00 00.
This decision came into force on June 8, was suspended by the District Administrative Court of Kyiv on June 10 in the form of an interim measure under a claim of Subos-Techno LLC, and now the ICMT canceled it. The plaintiff said that initially the investigation was initiated under two commodity codes of the Ukrainian tariff headings, and the special duty was introduced under three codes, of which only one coincides with the original two. Subos-Techno also claimed that the PVC of the KSR-67 brands (for the production of rigid, semi-rigid and plasticized PVC, pipes, profiles, films, sheets) and KSF-70 (for the production of plasticized films, profiles, insulation, injection molded parts) are also different from those imported on the market.
As a result, on June 22, the commission narrowed the application of the provisional duty on PVC, indicating that it is a product with a Fickentcher constant in the range from 59 to 72, which can be classified under code 3904 10 00 00, except for emulsion and microsuspension polyvinyl chloride.
In the new decision, the duty is set for PVC with a Fickentcher constant from 64 to 69.

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UKRAINE TO INTRODUCE ZERO DUTY ON WINE IMPORTS FROM EU FROM 2021

Zero duty on the import of wine from the EU will be introduced from 2021 in accordance with Ukraine’s commitments to zero import duties on a number of goods within a seven-year period after the signing of the economic part of the Association Agreement with the European Union, the Development Director of the Ukrainian Horticultural Association, the international consultant to the UN FAO, Yekateryna Zvereva, has said.
“From 2021, a zero duty will be introduced on the import of wine into Ukraine (from the countries of the European Union). At the same time, the situation in the wine market is not the best today – wine import to Ukraine increased by 25-30% compared to last year,” she wrote in a column to the Interfax-Ukraine agency.
She clarified that at present the duty on the import of wine from the EU is EUR 0.3-0.4/liter.
With reference to the data of the State Statistics Service, Zvereva reported that in 2019 Ukraine exported $11.9 million worth of wine. At the same time, Kazakhstan became the largest foreign market for Ukrainian winemakers, where products worth $1.3 million were delivered. In addition, one of the largest markets remains Germany, where $1 million worth of wine was exported.
At the same time, according to the expert, import of wine last year amounted to $ 146.7 million.
In addition, in the first half of this year, according to the State Customs Service, Ukraine exported $6.1 million worth of wine, while imports amounted to $67.9 million, the expert said.

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