New export bans: measures, exceptions, practice

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The word “import” for a person who grew up in the territory of the former USSR carries much more meaning than for a citizen of another country. “Imported goods” are akin to high-quality, rare and unique. But times are changing, and more and more we are using the word “import” to refer to the usual trade operation of moving goods produced in other territories into the territory of the country.

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The official definition of imports, as provided by the economic dictionary, is as follows:

Import is the entry into a country of foreign goods, services, technologies or capital for sale and use in the domestic market without obligations for re-export. Imports can be regulated by customs duties, as well as non-tariff methods (quantitative restrictions, licensing system).

So, imports are, first of all, what is imported from other countries, and secondly, imported goods will go into circulation on the domestic market, that is, they will be used for their own purposes by the importer himself or for further sale.

Causes

Free trade guarantees the movement of goods across borders without any restrictions.
In practice, this means the absence of high export-import duties, quotas on the import of certain things and subsidies for local producers of specific goods. The list of goods subject to restrictions or prohibitions on import into the customs territory of the Russian Federation is established by current customs legislation.

Restrictions are allowed in the form:

• special requirements for customs clearance;
• import limits;
• special increased customs duties (anti-dumping, countervailing, special protective, punitive, etc.);
• licensing of specific types of foreign economic activity;
• special quality requirements for imported goods, etc.

Restricted imported goods are imported (released by customs authorities) in compliance with the provisions of international treaties with the participation of the Russian Federation and the legislation of the Russian Federation.

Currently, there are several reasons why imports are limited in Russia - this is done for reasons of security of the Russian Federation (economic or state) for:

• reducing the number of imported goods;
• protecting the interests of Russian producers;
• preventing export excess and invasion.

Non-removable round timber

According to Rosleskhoz data, 219 million cubic meters of timber were harvested in 2021, of which 15.9 million cubic meters of round timber were exported. They are fighting the export of unprocessed timber by establishing ever-increasing protective duties - next year they should reach 80 percent of the value.

However, those who want to export unprocessed timber also do so illegally—in the first half of 2021, 6,800 cases of illegal logging were identified. This is 507,500 cubic meters of wood and damage to the budget, estimated at 3.9 billion rubles. The majority of illegal logging occurs in the Siberian Federal District (69 percent). This problem also exists in the Northwestern Federal District, of course, on a smaller scale. The leader in illegal logging last year, according to Rosleskhoz data, was the Arkhangelsk region - 66 thousand cubic meters. In the country as a whole, according to Greenpeace Russia, the volume of harvesting attributable to “black loggers” does not exceed 20 percent of the total volume of harvesting.

What will the upcoming export ban give to the economy? First of all, reducing the cost of raw materials for Russian producers, increasing the level of processing, and therefore expanding the domestic market with all the ensuing consequences. As a result, explains economist Alexander Arsky, the surplus value in the share of exports will increase (lumber that has undergone industrial processing will be exported), and business activity in cross-border territories will increase.

However, small companies will not be able to connect to processing so quickly, so the ban will only benefit big players, experts warn. And then only if the state helps them increase processing volumes. In addition, there are entire city-forming enterprises that risk being left without income and investment...

— If a general ban on exports is established, these restrictions will apply not only to valuable, expensive assortments - sawlogs, but also to pine pulpwood, their processing and, as a result, demand in the domestic market is limited due to the insufficient capacity of the pulp and paper mill, and free volumes exported,” says Andrey Konoplev, CEO of the group.

Small companies will not be able to quickly connect to processing, so the ban will only benefit large producers, experts warn

At the same time, the expert is sure that the timber industry in the Northwestern Federal District does not experience a shortage of coniferous wood raw materials. A ban on the export of pine pulpwood will lead to overstocking of the market and a decrease in their value. In addition, the situation will provoke a decline in logging, a redistribution of production costs to other assortments (sawn raw materials, plywood logs) and an increase in their cost, which will lead to increased production costs, a decrease in the efficiency and competitiveness of domestic sawmills, woodworking, and plywood enterprises. Similar negative consequences, for example, arose after the introduction of a ban on the export of plywood logs in 2021, recalls Konoplev.

Compromise solutions could have a milder impact on the industry, explains Evgeniy Doroshenko, environmentalist. For example: introduce very strict control over logging, carefully check areas where it is permitted, motivate loggers to restore forests, introduce personal liability for illegal and destructive logging, and suppress any opportunities for corruption.

However, this requires personnel, which, as we know, are in short supply, and also, as a survey of experts showed, the assistance of regional authorities, who are not always ready for such work.

What is happening in the regions of the Northwestern Federal District, where the timber industry is one of the main industries?

“Russia has been fighting the uncontrolled export of wood raw materials abroad for more than ten years,” recalls Alexey Kruptsov, deputy general director of PKP Titan LLC for production. — Our company not only shares the idea of ​​responsible forest management and the development of the Russian woodworking industry, but also supports it in practice. Moreover, all harvested timber remains in the region for processing.

According to the expert, logging enterprises in the North-West, unlike Siberia and the Far East, have been working for the domestic market for a long time; there is practically no export of round timber outside the country to the Northwestern Federal District. Therefore, in the Arkhangelsk region, for example, the issues of banning the export of unprocessed wood are not so relevant; in our country the problems of forest management and state forest inventory are much more pressing. It is no secret that the information on taxation descriptions is mostly outdated. Because of this, it is difficult to manage forests and plan the volume of reforestation, it is difficult to assess forest reserves and make long-term plans for harvesting activities. The renewal of forest taxation databases is an event that both responsible forest users and forest districts are waiting for in the Northwestern Federal District today.

In turn, the Vologda region also notes that they have been increasing deep timber processing for the past six years.

“Today we occupy first place in Russia in the number of investment projects in the field of forest development,” explains the head of the region Oleg Kuvshinnikov. Over the years, the implementation of 23 priority investment projects has begun, and to date, 17 of them have been implemented. Thus, total wood processing within the region increased from 65 to 75 percent.

As for the fight against illegal logging, according to the head of the region, this year the Vologda region suffered the least from “black loggers.” Space monitoring and air patrols helped. By the way, today 50 percent of the region’s forests are under space monitoring, reports the northern branch of Roslesinforg, which has been engaged in similar work since 2006. And it is in this way - from space - that 80 percent of the total volume of illegal logging in the country is revealed.

The volume of illegal logging in the region has decreased significantly in recent years and in 2021 amounted to less than 0.1 percent of the total volume of harvested timber, says Andrey Konoplev, CEO of the group.

However, the situation is not equal everywhere: for example, in Karelia, the volume of unprocessed timber production increased by 11 percent over the year, and the region’s timber industry officially shows its unprofitability - the share of unprofitable enterprises here is 60 percent.

By the way, according to experts, 77 percent of the roundwood in the region comes from birch timber. Namely, protective duties do not apply to it. So for now, Karelia will export round timber in the form of birch pulpwood.

PS

The upcoming ban was the most unpleasant news for some of the main exporters of round timber to the Northwestern Federal District - Finnish companies, whose stock prices have already started to slide down.

After all, 75 percent of timber exported in Finland comes from Russia.

Normative base

Basically, it explains what a restriction on the import of goods is and how it is regulated, the EAEU Customs Code.

Additional data in the letter of the Federal Customs Service No. 01-11/28567 dated July 16, 2008.

New bans on exports from Russia due to the pandemic and exceptions to the rules

And so we smoothly moved to new prohibitions that arose due to the spread of coronavirus infection.

The Government of Russia (RF RF dated March 2, 2020 No. 223) has established a temporary ban on the export from Russia of a number of goods that can be used in the fight against the spread of COVID-19.

These restrictions will be in effect until June 1, 2021 inclusive.

The list of products prohibited for export from Russia includes aerosol respirators, disposable chemical protection overalls, reusable anti-plague suits, shoe covers, masks, gauze, bandages, disinfectants, medical gloves, medical masks and other goods, namely:

It should be especially noted that the export ban applies to goods that are placed under customs procedures before the entry into force of this resolution and the actual export of which from the customs territory of the Russian Federation in accordance with these customs procedures is carried out after the entry into force of this resolution.

The ban does not apply to goods exported from the customs territory of the Eurasian Economic Union:

• to provide international humanitarian assistance to foreign states on the basis of decisions of member states of the Eurasian Economic Union;
• by individuals for personal use.

The ban also does not apply to the export of goods transported as part of international transit transport starting and ending outside the Eurasian Economic Union, as well as goods of the Eurasian Economic Union transported between the territories of member states of the Eurasian Economic Union through the territory of states that are not members of the Eurasian Economic Union.

The ban is established directly for export from Russia, which means that the goods mentioned above cannot be exported even to countries members of the Eurasian Economic Union, such as Kazakhstan, Belarus, Armenia, Kyrgyzstan.

What is imported in limited quantities?

Decision of the Board of the Eurasian Economic Commission No. 30 dated April 21, 2015 in Appendix No. 2 contains examples of import restrictions with permitting (under Part 3 of the Decision) import. Some of them are in tables:

Examples of species of wild fauna and flora covered by the Convention on International Trade in Endangered Species of Wild Fauna and Flora of 03/03/1973 (CITES):

Examples of rare and endangered species of wild living animals and wild plants:

Other examples of restricted import goods:

Elimination of foreign trade benefits, final elimination of quantitative restrictions on exports and imports, liberalization of oil exports and abolition of export duties until January 1, 1996.
Monthly monitoring of the implementation of these obligations. [p.559] Programs 1995-1996 contained provisions aimed at completing the process of liberalization of foreign economic activity. Russia has committed itself to eliminating preferences in foreign trade and the final elimination of quantitative restrictions on exports and imports. The institution of special exporters of strategic goods, including oil, was eliminated. All export duties were abolished, including on oil and gas, and the resulting losses for the budget were compensated by an increase in excise taxes. It was intended to reduce customs duties on imports. Under the 1996 agreement, the government pledged to refrain from quantitative restrictions on the import of alcohol and from granting import duty concessions on media materials. Mandatory pre-customs examination of exported goods was abolished. [p.574]

The Government of the Russian Federation makes decisions on customs tariff rates and introduces quantitative restrictions on the export and import of goods based on licensing and quotas for export-import operations. The state monopoly on the export and import of certain types of products, works, and services is introduced through licensing. [p.749]

Article 15. Quantitative restrictions on exports and imports [p.349]

Quantitative restrictions on exports and imports may be introduced in exceptional cases by the Government of the Russian Federation for the purposes of [p.350]

Decrees of the Government of the Russian Federation on the introduction of quantitative restrictions on exports and imports are adopted and officially published no later than three months before these restrictions come into force. [p.350]

A foreign trade quota is a restriction in value or physical terms imposed on the import or export of specific goods for a certain period of time. A general quota is a quantitative restriction on exports and imports introduced by the Government of the Russian Federation. A quota is a share of the total quota determined by the Ministry of Economic Development and Trade of the Russian Federation in agreement with the interested federal executive authorities and communicated to the Interdepartmental Commission for the organization of competitions and auctions for the sale of export and import quotas for the purpose of placement and sale at a competition or auction. [p.500]

Decrees of the Government of the Russian Federation on the introduction of quantitative restrictions on exports and imports are adopted and officially published no later than three months before these restrictions are put into effect. The duration of the restriction, its early cancellation or extension, as well as all changes are established by the Government of the Russian Federation, taking into account the international obligations of the Russian Federation. [p.501]

Exports from the Russian Federation and imports into the Russian Federation are carried out without quantitative restrictions. Quantitative restrictions on exports and imports may be introduced in exceptional cases by the Government of the Russian Federation for the purposes of [p.144]

One of the fundamental guiding principles of the GATT/WTO system is the recognition of customs tariffs as the main form of protection of national production, and the level of tariff duties should be consistently reduced, and non-tariff barriers, primarily quantitative restrictions on exports and imports, should be eliminated. In practice, however, as before the advent of GATT, a significant share of imports continues to be regulated through non-tariff restrictions. This applies, in particular, to food, tech- [p.180]

The limitation is the establishment of special requirements for the import or export of certain types of goods (licensing and quotas). Licensing is being introduced for some types of goods. Or it can be entered for any country or group of countries. Quotas are a quantitative restriction on the export and import of licensed goods (establishment of a quota). [p.250]

If any product or products are imported in such large quantities or under such conditions that significant damage is caused or there is a threat of causing such damage to producers of similar or directly competing goods on the territory of the Russian Federation, the Government of the Russian Federation, in accordance with generally recognized norms of international law, has the right take protective measures to such an extent and for such a period that may be necessary to eliminate serious damage or prevent the threat of causing it, in the forms of a) quantitative restrictions on exports and imports (non-tariff regulation) b) introduction of an increased special customs duty (customs tariff regulation ). [p.230]

QUANTITATIVE RESTRICTIONS ON EXPORT AND IMPORT [p.276]

QUANTITATIVE RESTRICTIONS ON EXPORT AND IMPORT - a method of non-tariff regulation used in the Russian Federation in accordance with Art. 15 of the Law on State Regulation of Foreign Trade Activities. [p.276]

Exports from the Russian Federation and imports into the Russian Federation are carried out without quantitative restrictions. Quantitative restrictions on exports and imports may be introduced in exceptional cases by the Government of the Russian Federation in order to 1) ensure the national security of the Russian Federation 2) fulfill the international obligations of the Russian Federation, taking into account the state of the domestic goods market 3) protect the domestic market of the Russian Federation. The introduction of quantitative restrictions on exports is carried out taking into account the fulfillment by the Russian Federation of its obligations under agreements concluded in accordance with the Law on Production Sharing Agreements, in terms of ensuring the export of mineral raw materials, which, in accordance with the terms of these agreements, are the property of the investor. [p.276]

Decrees of the Government of the Russian Federation on the introduction of quantitative restrictions on exports and imports are adopted and officially published no later than three months before these restrictions are put into effect. The distribution of quotas and the issuance of licenses when establishing quantitative restrictions are carried out, as a rule, by holding a competition or auction or in the order of actual export and/or import operations until the total fulfillment of the quota with the provision by the federal body of coordination and regulation of foreign trade activities of a preemptive right to manufacturing organizations. [p.276]

Quantitative restrictions on exports and imports are established in accordance with the Federal Law on State Regulation of Foreign Trade Activities. [p.508]

For all subjects of foreign trade activities, regardless of ownership and organizational and legal forms. The Law on State Regulation of Foreign Trade Activities formulated general principles defining their legal status. These include the principle of equality of participants in foreign trade activities and their non-discrimination, according to which all participants in foreign trade activities must have equal rights and obligations, equal conditions of activity. A manifestation and provision of this principle can be considered a new provision addressed in the Law to trade missions, according to which it is not permitted for trade missions of the Russian Federation to refuse to provide information and consulting services to Russian participants in foreign trade activities, in particular based on the form of ownership, place of registration, size of the authorized capital (v. 32). As an implementation of this principle, the following requirements for the procedure for conducting a competition or auction for the distribution of quotas and issuing licenses can be introduced when, in exceptional cases, the government of the Russian Federation introduces quantitative restrictions on exports and imports, according to which it is not allowed to limit the number of participants in such a competition or auction and discriminate against them based on characteristics of the form of ownership, place of registration, market position (Article 15). An important aspect of ensuring equal conditions for participants in foreign trade activities is reflected in the Law of the Russian Federation On Certain Issues of Providing Benefits to Participants in Foreign Economic Activity dated March 13, 1995, which were prohibited from benefits not provided for by tax and customs legislation. [p.129]

Provisioning and licensing. Export and import quotas are quantitative or cost restrictions on exports and imports introduced for a certain period of time for individual goods and services, countries and groups of countries. [p.34]

In relation to goods for which quantitative restrictions on export or import have been established, extension of the license period is possible only if the period of validity of these restrictions is extended. Extension of the license validity period is issued in the form of a letter signed by the authorized representative of the Ministry of Economic Development and Trade of the Russian Federation in the relevant region and certified by his seal; this letter is an integral part of the license. [p.499]

Measures to directly restrict exports and imports may be introduced in exceptional cases by the Government of the Russian Federation in order to protect national interests and the national market. In accordance with Art. 15 of the Federal Law on State Regulation of Foreign Trade Activities, exports from the Russian Federation and imports into the Russian Federation are carried out without quantitative restrictions [p.500]

The specified restrictions on exports and imports are carried out by the State Military Commission of the Council of Ministers of the USSR on the proposal of the Ministry of Foreign Economic Relations of the USSR together with the competent government bodies in the form of quantitative or cost quotas for imports or exports. Deals carried out within the framework of filling such quotas are subject to licensing. [p.215]

The state's export-import policy has a regulatory impact on prices. Quantitative and qualitative restrictions on exports and imports, customs duties have an impact on the country’s foreign trade prices and on the prices of the domestic market. Fencing the domestic market from foreign competition, as well as the direct impact on the prices of imported goods by the size of customs duties, leads to limited supply and weakening of competition in the domestic market, increasing prices for imported goods, followed by prices for domestically produced products. [p.22]

Quotas are a quantitative restriction on the production, export and import of goods (by physical volume or value), introduced by government agencies in order to regulate international trade, as well as balance domestic trade and payments. [p.490]

EXPORT AND IMPORT QUOTAS - quantitative or cost restrictions on imports and exports, introduced for a certain period of time for individual goods and services, countries and groups of countries. It is used as a non-tariff means of state regulation of export-import transactions. In foreign practice, the so-called tariff quotas, within the limits of the value or quantity of which imported goods are subject to customs duties at the usual rate, and in cases where the established restrictions are exceeded, increased duty rates are applied to the goods. [p.100]

However, administrative measures continue to be used in a number of areas. Firstly, at the initial stage of the transition to a market, the state often retains administrative control over prices and tariffs for socially significant goods and services. Secondly, administrative methods of regulation are used as a means of antimonopoly policy (the state intervenes in the activities of natural monopolies, including setting prices for their goods and services). Thirdly, administrative means are used to regulate foreign economic activity (quantitative restrictions and licensing of exports and imports). [p.646]

If in models of the 1960-1970s. the main attention was paid to quantitative growth indicators, which depended on the level of capital investment, the share of exports and imports in GDP, etc., then in the IMF recommendations the most important were qualitative transformations in the economy, improving the management apparatus, ensuring production efficiency, limiting the role of the state as an active subject of economic influence, development of market relations. The goal was to sharply reduce the share of the public sector in the economy through the sale of shares of state-owned enterprises [p.137]

To implement the Federal Law “On State Regulation of Foreign Trade Activities,” the Government of the Russian Federation adopted a resolution “On the procedure for holding competitions and auctions for the sale of quotas when introducing quantitative restrictions and licensing the export and import of goods (work, services) in the Russian Federation” dated October 31, 1996. No. 1299. [p.39]

The federal executive body specified in part four of this article is the only government body that issues licenses to carry out export and import operations in respect of which quantitative restrictions have been established or a permitting procedure has been introduced in accordance with the provisions of this Federal Law. [p.349]

In the practice of international relations, in accordance with K., the number of votes countries have in representative bodies, the size of allocated credit funds, contributions are determined; b) an instrument for regulating exports and imports in foreign trade by establishing quantitative restrictions on the volume of imported and exported goods for a certain period. In modern conditions, protection is increasingly being replaced by various forms of protectionism, that is, the targeted protection of the domestic market from the flow of foreign-made goods. In international trade practice, it is customary to distinguish between export and import regulations, established on the basis of the international obligations of a country to limit the production, export, or import of goods or in accordance with the need to comply with national economic interests. Thus, export standards, as a rule, are established on the basis of international stabilization agreements, which determine the share of each country party to the agreement in production and exports.

An important role in the implementation of state foreign economic policy is played by the Federal Law of the Russian Federation “On State Regulation of Foreign Trade Activities”, adopted by the State Duma on July 7, 1995. This law defines the entire system of regulation of foreign trade. It covers not only the procedure for establishing customs duties and, in certain cases, quantitative restrictions on exports and imports, but also, most importantly, the mechanism of export control, which relates primarily to military-technical cooperation (trade in arms, military equipment and dual-use goods). [p.214]

As a clear example of the contractual enshrinement of most favored nation and non-discrimination, as well as an example of the real relationship between these principles and mutual benefit, we cite Art. 1 (Most favored nation and non-discriminatory treatment) Agreement of June 1, 1990 on trade relations between the USSR and the USA (came into force for Russia and the USA on June 17, 1992). According to this article, most favored nation treatment applies only to the export and import of goods, including customs duties and fees, payments, customs clearance rules, transit, warehousing, internal direct and indirect taxes and fees on imported goods, rules for sales, transportation, storage and use of goods on the domestic market. The non-discriminatory regime is stipulated in relation to quantitative restrictions and the issuance of licenses for the import and export of goods, as well as the distribution of foreign currency to pay for imports. That is, in terms of the subject of application, the most favored nation regime operates within a relatively narrow range. [p.111]

Quantitative restrictions (quotas, allocations) are the most stringent way to regulate exports and imports and the most incompatible with a market economy. [p.181]

This is a procedure according to which the export and/or import of certain or all goods is possible only upon receipt of a license (permit) for the import and/or export of specific goods and in certain quantities. Along with quantitative restrictions, licensing is the most effective way of non-market direct and flexible regulation of exports and imports. [p.183]

Foreign trade regulation and protectionism. Although free international trade is beneficial to all countries, most of them use certain restrictions on foreign trade transactions. These restrictions are generated by the state’s desire to receive income from taxation of foreign trade, as well as pressure on the state from lobbying groups of those industries that cannot withstand competition in the domestic market with imported goods. Restrictions on foreign trade can take various forms, from direct quantitative restrictions on the scale of imports (and in some cases, exports) to the establishment of different amounts of taxes (duties) on the export and import of goods. The policy of restricting access of imported goods to the domestic market is called protectionism. It is always unprofitable for the country as a whole and buyers of goods in particular. But most countries in the world still use it, since it allows not only to avoid conflicts with powerful domestic firms, but also to replenish the state budget. In the 20th century More and more countries are realizing the disadvantages of protectionism and are joining international trade organizations and economic unions. Russia also needs to join the largest of these organizations, the World Trade Organization, to protect its exporters from protectionist measures of other countries. [p.318]

In 1958-1968 (“transition period” of the formation of a common market for goods, services, capital and labor) customs duties and quantitative restrictions on the export and import of industrial products within the EEC were abolished (partial liberalization was carried out for agricultural products and a special regime for supranational regulation of their production and sales was established) , a single customs regime (including a single customs tariff) has been established for goods imported from third countries. In the field of agriculture, a general regime was introduced to regulate prices and production volumes of the main types of agricultural products of the temperate zone (meat, grain, oil, etc.) and the EEC Agrarian Fund (FEOGA) was created, designed to promote the modernization of the agricultural sector and counteract the massive ruin of farms. In addition, the migration of capital and labor within the EEC was significantly liberalized. [p.48]

PROTECTIONISM [fr. protetionnisme of the domestic market from the receipt of foreign-made goods, i.e. state policy aimed at encouraging the domestic economy (domestic entrepreneurs), protecting it from foreign competition, expanding foreign markets for domestically produced products. This policy is carried out with the help of trade and political barriers that protect the domestic market from the import of foreign goods, reducing their competitiveness in comparison with nationally produced products. This involves the introduction of a set of direct and indirect import restrictions, namely customs tariffs, quotas (establishing the share of goods allowed to be imported into the country), non-tariff barriers, currency restrictions, countervailing duties, internal taxes and fees, a special regime for government procurement, voluntary export restrictions and etc. Protectionism is characterized by financial incentives for domestic producers and material incentives for the export of goods. The system of protectionist measures means the following: high customs duties are introduced to prevent the import of certain products; imports are quantitatively regulated; restrictive quality standards are used; obstacles are created for the competition of foreign products with local production. Protectionism replenishes the state treasury with additional revenue from customs duties and other fees. [p.253]

The first is government, administrative measures that are not directly related to the use of economic leverage on markets. This is a direct ban on trade - an embargo, a trade blockade, a boycott, and most usually - quantitative restrictions (quotas, quotas) for exports and imports or permissive trade licensing systems. These are also all sorts of strict technical requirements for packaging, labeling, tightening and complication of customs clearance, documentation and inspection, etc. (so-called technical barriers to trade - see below). Complicated and sophisticated sanitary and phytosanitary quarantine measures, requirements for confirming the origin of goods, etc. can be used as protectionist means of protecting the domestic market. [p.181]

What is prohibited to import

The rules regarding whether there are bans on the import of any goods in the Russian Federation (and they do exist) are regulated by several norms:

The powers of the Board of the Eurasian Economic Commission and the Government of the Russian Federation are to introduce bans on the import of products, some types of which are collected in the table:

Why does Russia ban imports?

The Russian government is constantly tightening government procurement, consistently introducing bans on goods of foreign origin. Several dozen types of foreign products are already banned, including food, textiles, shoes and wine.

Recently, the Ministry of Industry and Trade also proposed extending the ban on government purchases of foreign furniture until the end of 2021. The moratorium introduced in 2017 expires on December 1, and this measure called for promoting the development of the domestic market, the ministry is confident.

In May, Russian Prime Minister Dmitry Medvedev banned officials from purchasing imported wine, as well as sparkling, liqueur and fruit (fruit) wines, so that they would purchase only domestic products.

In fact, such decisions, as a rule, are lobbied by individual companies and are of a targeted nature, say experts interviewed by Gazeta.Ru.

By themselves, they are not effective, since they do not become a driver of economic growth in Russia, which is evident from the slowdown to 0.5% of GDP in the first quarter of this year, notes Igor Nikolaev, director of the FBK Institute for Strategic Analysis (the organization is included in the list of foreign agents by the Ministry of Justice). “Little discernible” economic growth shows that the harm from numerous bans is greater, but the effect is small, he says.

In order to achieve a “jump” from the domestic manufacturing industry in the case of the same furniture, it is important that the ban be temporary and not permanent, notes Valery Mironov, deputy director of the HSE Development Center.

“It is necessary to set a deadline for the ban to be in effect and to give manufacturers time to improve the quality of their products,” the expert is confident.

Even if officials are now forced to buy Russian goods, the question remains: how economical and effective is this, since the furniture sector produces products that are not always of high quality, Mironov notes, and if the products are of poor quality, they will have to be updated frequently, which is for the budget from an economic point of view view is unfavorable.

The sphere of public procurement is a small percentage where public money is spent, through which it is possible to support some manufacturers,

explains the director of the Institute of International Economics and Finance of the VAVT Ministry of Economic Development, Alexander Knobel. Such measures will not cause a noticeable effect within the framework of import substitution, but will provide support to individual Russian companies,” says Knobel.

Nevertheless, the sphere of public procurement is quite voluminous. The staff of officials is large, there are many authorities, “so they need to be furnished, and officials like to furnish,” notes Nikolaev. He. And the moves will come with new furniture, the expert recalls about the recent “migration” of three ministries to Moscow City. In this context, domestic producers, of course, will be happy with the import ban.

However, there are many risks along this path. One of the obvious “disadvantages” is the restriction of competition, without which the market economy “decays”. This affects both the quality and price of the final product.

Import substitution is a dangerous thing if taken literally, agrees Knobel.

“Increasing the share of domestic goods in the domestic market can be easily achieved by limiting import supplies. But, most likely, this will lead to the preservation of backwardness, a decrease in competitiveness due to reduced competition, and certainly will not contribute in any way to the development of export opportunities,” Knobel is sure.

The problem of import substitution is difficult to solve, because in such economic conditions the domestic market is not growing, adds Valery Mironov. Currently, it has been successfully dealt with only in the food and partly defense sectors; it has practically not been possible to do this in the high technology sector.

Import bans in government procurement began in 2014. Every year the authorities moved more and more confidently along the protectionist path. Already in 2016, it was reported that 420 types of goods of foreign origin were banned in government procurement.

In addition to a complete ban, there is also the concept of “restriction” on the admission of goods. At the moment, there are already more than 550 products on this “black list”. As the press service of the Ministry of Finance told Gazeta.Ru, about 288 items have so far been completely banned, excluding the ban on all foreign software, which is regulated by a separate resolution. About 264 items are subject to restrictions in government procurement, the department added.

Bans apply in various areas - from the defense industry to textiles and food. One of the very first “import” bans for officials was introduced in 2014. Then they were prohibited from spending budget funds on foreign cars, having prescribed in the legislation certain technical characteristics of cars that are allowed for government procurement.

Thus, by updating the vehicle fleet, officials could help the domestic automobile industry. This was done on a general wave of import substitution, which arose as Russia’s response to the devaluation of the ruble caused by the fall in world oil prices and sanctions. In 2015, this measure was also expanded - then Medvedev banned the use of imported engineering equipment for government needs. In the same year, the authorities limited government purchases of foreign medicines, as well as medical equipment from abroad.

Later the ban extended to food.

It affected government purchases of fresh and frozen fish and meat products, milk, butter, rice, sugar, and salt. In total, there were 23 items on the list. At the same time, the ban on fruits and vegetables was bypassed, because in this sector the share of domestic products is low.

A little earlier, restrictive measures were also imposed on the non-food sector. They have been operating since 2014, when the government banned the purchase of light industrial goods from abroad. The Ministry of Industry and Trade assured that in times of crisis this measure “will be a good help to the national industry.”

The “forbidden” list of government orders includes imported carpets, leather clothing, workwear, linen, fur products, shoes, bags and more. This was a federal ban; two years later, in 2021, this ban was recognized as effective and was extended to the regions. For example, the Ministry of Industry and Trade reported in 2016 that after the introduction of previous restrictions, the share of goods from the countries of the Customs Union increased from 30% to 83%. In all cases, the countries of the EAEU (Eurasian Economic Union) are excluded from the ban: Belarus, Kazakhstan, Armenia and Kyrgyzstan.

In addition, this summer will mark the fifth anniversary of the “food war.” It is in the food sector that the greatest success has been achieved in the task of import substitution. In August 2014, the country introduced a trade embargo against the EU, the USA and other countries that had imposed sanctions against Moscow. Meat and meat products, milk and dairy products, fish and fish products, vegetables and fruits were banned. Last year, Rosselkhoznadzor reported that 26 thousand tons of sanctioned products were destroyed over three years.

It was fashionable to talk about import substitution in 2014-2015, Knobel recalls. Starting from 2016-2017, it was abandoned, but “the word has not yet become a dirty word,” the expert sneers. Now we are talking about creating competitive export-oriented industries, and not about import substitution as such.

How do individuals import goods?

Briefly, how the ban on the import of imported goods affects individuals. For personal use, according to the EAEU Labor Code (Chapter 37), a specific list of goods and their volumes are allowed to be imported into the territory of the Russian Federation without duties and declarations (see Appendices No. 1, 3, 6 to SEEC Decision No. 107 of December 20, 2017, Decision). Exceeding the established limits obliges individuals to declare goods (under Article 260 of the EAEU Labor Code) and pay duties (under Articles 266–271 of the EAEU Labor Code) in the amounts specified in Appendix No. 2 to the Decision.

The list of goods for personal use with restrictions and prohibitions on import is formed by the Decision of the Board of the Eurasian Economic Commission No. 30 of 04/21/2015. According to Part 9 of Art. 256 Labor Code of the EAEU. The consolidated list is posted at https://docs.eaeunion.org/ru-ru

What are the types of imports?

All types of import operations are usually divided into two large categories:

• import of consumer goods and industrial products;
• import of raw materials (products that are necessary for processing and for the manufacture of other products) and services.

Another type of import classification is dividing it into direct and indirect:

• with direct import, the buyer purchases the goods directly from a foreign manufacturer or distributor (non-resident);
• indirect import is the receipt of goods and services from an intermediary company specializing in such operations; in this case, the goods are purchased from a resident of the country of import; This scheme makes it easier and faster for the buyer to receive the goods.

According to the type of imported products, imports are also divided into visible and invisible:

• visible imports are specific goods or raw materials received for domestic use, resale, or processing;
• invisible trade , that is, exchange without any material things, is the exchange of services, which include transport, insurance, travel services, transfers abroad, commissions, etc. If you look at it completely globally, these are all services that were paid for in the currencies of other countries. In fact, invisible imports are the purchase of services from a non-resident partner.

Investment imports can also be partly included in the category of invisible imports. Essentially, this is the import of capital, that is, when a company or individual who is not a resident invests its funds in the national economy.

Re-import is another subtype of international trade operations. Usually this is the return of goods to the country of origin. The main criterion is the absence of repairs or modernization of returned imported goods. It often happens that goods that are found to have manufacturing defects or that were not sold by the distributor are re-imported.

Keep records of exports and imports using the simplified tax system in the Kontur.Accounting web service. Currency accounting and work instructions, taxes, automatic salary calculation and reporting in one service Get free access for 14 days

Based on the price level of imported products, so-called dumped imports . Its essence is that goods are imported at a price significantly lower than the average market price. But dumped imports can be completely legal if the importing enterprise has benefits, receives subsidies or is exempt from paying duties, or if the exporting enterprise independently reduced the price of its goods.

According to the requirements and restrictions from the state, imports are divided into licensed and unlicensed.

• Licensed imports require special permits from regulatory authorities. Licensed goods include, for example, pharmaceuticals, chemicals, encryption, copying and recording devices, precious stones and metals, and much more. Moreover, you need to obtain a license to import goods before concluding a contract with the supplier.
• Accordingly, unlicensed import implies the absence of restrictions on the import of goods into the territory of the Russian Federation.

Gray import

Keep records of exports and imports using the simplified tax system in the Kontur.Accounting web service. Currency accounting and work instructions, taxes, automatic salary calculation and reporting in one service Get free access for 14 days

Export-import transactions are heavily regulated by government agencies. If an enterprise directly imports products, it is obliged to conclude a foreign economic contract, issue a transaction passport, customs declaration, goods and transport declaration, and provide additional documents if required by law. We talked about these procedures in another article.

But sometimes, in order to reduce customs duties, taxes and other costs, importers indicate false information in documents. For example, instead of expensive clothes, they indicate raw materials for sewing (fabrics and accessories), instead of a whole device, they indicate spare parts for it, etc. Another option to reduce customs costs is to indicate the price of the goods significantly lower than the market average. Another way to indicate incorrect information is to incorrectly indicate the country of origin of the product, namely, replace it with one for which there are more preferences. We warn you against such fraud.

What are the risks of using such schemes? First of all, if the customs service discovers that the cargo does not comply with the documents, the importing enterprise will have to pay a fine and a full duty.

How legal entities import goods

To import products into the Russian Federation, legal entities will need:

1. Select an imported product in compliance with customs legislation (see section “Regulatory framework”), otherwise you will be subject to administrative or criminal liability (see section “Responsibility for the import of “prohibited” products”) and Art. 12 TC EAEU.
2. Agree with the seller on its cost, taking into account Ch. 5 TC EAEU.
3. Determine (according to Chapter 3 of the EAEU Labor Code) the commodity code in the Commodity Nomenclature of Foreign Economic Activity.
4. Conclude an agreement with the seller and receive from him all the necessary primary documents. The rest will come with a delivery person.
5. Draw up the necessary transportation agreement with the transport company if things are delivered by persons other than the seller and buyer.
6. Pay for concluded contracts.
7. Pay for customs clearance.
8. Pre-inform the customs of the Russian Federation about the cargo crossing the border (according to Article 11 of the EAEU Labor Code).
9. Submit a transit declaration, if required (see Chapter 17 of the EAEU Labor Code).
10. Deliver the cargo within a specific time frame from the border to the place of delivery to the internal customs post and place it in the customs control zone or temporary storage warehouse.
11. Prepare and submit a goods declaration (see Chapter 17 of the EAEU Labor Code).
12. Pay customs duties (see Section II of the EAEU Customs Code).
13. Transport the product from the customs warehouse.
14. Store import documents (see Article 320 of the EAEU Labor Code).

Restrictions on foreign trade

Restrictions on foreign trade are a government decision that creates obstacles and complicates the process of trade turnover involving foreign products in the domestic market of the state. Typically, such decisions may take the form of quotas or additional tariffs on the sale of imports.

Restrictions on foreign trade: essence

The process of government regulation itself is a set of measures, tools and methods that are used by government agencies in relation to other countries, taking into account national interests. Regulation can be done through laws, decisions and regulations. With regard to international trade, there are several methods (tools) of influence that allow for regulation - restrictive conditions, the introduction of customs tariffs, the drawing up of agreements (contracts) between countries, the introduction of additional measures to enhance imports or exports.

At the same time, in history there are two directions in relation to non-economic relations:

- free trade. In this case, the country focuses on free trade, when customs authorities assume exclusively registration functions. As for restrictions, duties on exports or imports, they do not exist. This approach was relevant for England in the 19th century, and its basis was the theory of Ricardo. In practice, this approach to foreign economic policy is available to countries that have a highly developed economy and can cope with competition;

- protectionism is a form of political measures when more favorable conditions are created for domestic entrepreneurs within the country (when compared with goods from abroad). Moreover, this type of policy can be implemented through two methods:

1) Tariffs. In this case, by decision of the government, additional customs duties are established. At the same time, the customs tariff itself is a group of duties that are imposed on a number of goods imported into the country or imported across the border. In essence, customs duties are taxes additionally imposed by the state for the transportation within the country (from the territory of another state) of valuables, property, and so on.

The customs tariff has several functions. These include:

— trade and political; — regulatory (the state controls the process of import and output of products; — protective (domestic producers are protected from imposed competition); — fiscal (the budget is replenished due to the activation of domestic production).

The owner of the imported goods, after paying all duties, invariably changes the prices of the imported products. As a consequence, a tariff restricting imports leads to a decrease in the opportunities of potential buyers. This approach primarily benefits domestic producers and the state itself.

2) The second group of methods (non-tariff) can be considered from the perspective of the following classification:

— introduction of administrative measures or numerical limits. This category includes certification, contingent, licensing and other methods of influence;

— introduction of technical measures, namely additional hygienic controls, requirements for quality standards, packaging or labeling;

— the introduction of economic measures, the essence of which is the collection of VAT, currency control, the mandatory introduction of customs duties, control over pricing policy, a state monopoly in relation to foreign trade relations, negotiations with representatives of exporters of other countries on reducing the volume of goods supplied, and so on.

Non-tariff restrictions are established at the state level and represent direct measures of influence that determine the exact nomenclature and volume of products allowed for import into the territory of the state or export outside its borders.

Simultaneously with the number and type of goods, a restriction may be introduced entirely on the countries with which trade can be conducted. In turn, quantitative limits can also be used to solve global problems, for example, combating trade imbalances with certain countries or as a response to the actions of governments of other countries.

In practice, restrictions on foreign trade are introduced in relation to those groups of products that are necessary for the country itself. It is important to take into account the features of some other measures:

- contingents - restrictions on imports and exports with a certain amount (quantity) of goods in a specific period;

— quotas — restrictions on the volume of imports or exports of groups of goods of certain items. Of all forms of non-tariff restrictions, quotas are the most common;

— licensing implies a ban on the import of a particular product in the absence of a specific license. The latter can be provided for a certain volume of goods and be valid for a limited time period.

Restrictions on Foreign Trade: Main Causes and Consequences

In practice, all restrictions on goods imported into the country are introduced for a reason, but to solve certain problems and maintain a given policy. Of all the existing reasons, two can be considered the main ones:

— the desire of the state to help the importer and allow him to set more competitive prices for his goods; - a way to help and protect one’s own industries from excessive foreign competition caused by the active import of goods from abroad.

An increase in tariffs on the market of the importing country inevitably forces a supplier from another country to sell its products at more affordable prices in order to sell the goods faster. On the other hand, if he does not do this, then he will not be able to sell the imported products. This is due to the fact that domestic producers are not affected by tariffs. There is also a third side to the coin. Due to the introduction of such restrictions and against the backdrop of rising costs of imported goods, domestic producers also raise their prices. As a result, its profit and the volume of contributions to the country's treasury increase.

But this technology only works in a situation where such measures are introduced unilaterally. That is, one country sets tariffs on imports, while the other continues to cooperate as usual. In practice, an “exchange of blows” may begin when another country introduces “mirror” measures in response. An avalanche of additional measures against each other's imports begins, which leads to a trade war. A similar situation was already observed during the Great Depression about a hundred years ago, when world trade experienced a serious crisis.

The second reason for restrictions on foreign trade is the desire to protect certain industries from competition from suppliers in other countries. In such a situation, consumers lose the additional benefits that active international trade gives them. In turn, protective measures against their producers inevitably lead to similar impacts on the other side. As a result of such “wars”, the consumer suffers.

Often the introduction of trade restrictions is explained from the point of view of protecting one’s own industry and reducing the risk of losing jobs within the country and preventing an increase in unemployment. In some cases, this scheme works, but in any case, jobs will be saved, because the real profits of consumers are decreasing and prices are rising. In addition, the resources of various branches protected in this way will be used inefficiently.

At the same time, there are countries where active import of goods from abroad really causes problems. In particular, in some countries this leads to a decrease in the level of contributions to the treasury. In the West, such situations are resolved through trade restructuring. In particular, special benefits are being introduced for the unemployed, certain programs for retraining, and the opportunity to issue loans to employees of firms and companies affected by competition is being provided.

Something similar is happening in Russia. At the same time, this policy (especially in relation to civilian areas of activity) is very relevant. A greater burden on industries involved in the production of consumer products can attract additional investment resources and make them more competitive in comparison with foreign goods. At the present stage, there is not enough help from the state or our own resources to carry out perestroika.

In some cases, the introduction of trade restrictions is justified by a group of non-economic reasons. For example, if a state believes that it must be prepared for a military operation, then it focuses on supporting its own industries. At the same time, the main goal is to develop within the state those industries whose products are currently easier and more profitable to purchase abroad. In this way, protection from foreign competition is provided. History knows of cases where strict restrictions on trade were introduced for political reasons. For example, the United States introduced severe bans on trade transactions with countries such as Libya and Cuba.

Import duties in 2021

Tariffs for customs operations are established by RF PP No. 863 dated December 28, 2004.

Duty rates for customs clearance (with a 25% discount for electronic declaration):

Rates for customs clearance of individual items:

For all types of vessels, temporary import is paid.

From 01.08.2020, import duties are determined in the RF Regulation No. 342 of 03.26.2020.

IMPORTANT!

Things from Art. 47 Federal Law No. 289 of 08/03/2018 are free from paying customs duties. The EEC Council has expanded the list of goods with zero import customs duties and simplified the requirements for certificates of origin.

New bans on food exports

Among other things, some food products were also banned.

The EEC Board, by decision No. 43 of March 31, 2020, also approved the list of food prohibited for export, namely:

It should be noted that the ban on the export of rice will not affect the crop growing in the Republic of Kazakhstan, as reported in the Decision of the EEC Board itself.

As a note, it is important to note that:

1. It is necessary to be guided by both the EAEU HS code and the name of the product.

2. The ban does not apply to goods exported from the customs territory of the Eurasian Economic Union:

• to provide international humanitarian assistance
• by individuals for personal use;
• as supplies, as well as to support the operation of structures and installations over which Member States have exclusive jurisdiction.

3. The ban does not apply to the export of goods transported as part of international transit transport.

Responsibility for importing “prohibited” goods

Depending on the severity of the act, a violation of the ban on importing goods into Russia is punishable either administratively or criminally. Administratively according to Art. 16.3 of the Code of Administrative Offenses of the Russian Federation, violators are fined:

• individuals - for 1,000–25,000 rubles. with commodity confiscation (or without). Or only commodity confiscation;
• officials - 5,000–20,000 rubles;
• legal entities - by 50,000–300,000 rubles. with commodity confiscation (or without). Or just commodity confiscation.

Smuggling of potent, poisonous, poisonous, explosive, radioactive substances and other things that are especially dangerous for people and the state is punishable under Art. 226.1 of the Criminal Code of the Russian Federation with imprisonment for 3–12 years with fines up to 1,000,000 rubles. The court has the right to supplement imprisonment with a fine on the income of the offender for up to five years with restriction of freedom for a year or two.