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Russia joins the WTO

On 22 August 2012 Russia officially joined the WTO. Russia has been negotiating is accession to the WTO for the last 19 years as it applied in June of 1993 to join the WTO with the Working Party of the Accession of the Russian Federation being established in June 1993. Russia thus became the 156th member of the WTO.

From the date of accession Russia has committed to fully apply all WTO provisions whilst very few transitional periods apply. Normally when a country joins a few of the WTO provisions will be suspended during a transitional period. Typically such suspensions would allow a newly admitted member to not apply all the WTO provisions whilst it adjusts to increased trade. It also allows existing WTO members to take measure they may not normally rely upon, such as imposing quotas on imports from the newly acceded member.

According to the WTO, Russia will, on average, apply a final bound tariff of 7.8% for goods, of which the average tariff for agricultural products and manufactured products are 10.8% and 7.3% respectively. Due to the fact that this is only an average, the bound tariff on many products may of course be much higher than 7.8% especially where Russia would like to maintain some protection for its local industries. Russia also concluded 57 bilateral agreements on market access for goods and hence may afford more preferential access to those 57 members.

Russia also made commitments to liberalise trade in services and made commitments in 11 of the services sectors. This also represents an opportunity for foreign services providers to render their services in Russia. Russia maintain a maximum of 49% limitation on foreign ownership, but will eliminate this in the telecommunication sector after 4 years from the date of accession.

These commitments are of course only the main commitments and Russia made commitments on several other important matters such as export duties, industrial and agricultural subsidies, energy, sanitary and phytosanitary measures, technical barriers to trade, trade-related investment measures and the protection of intellectual property rights.

For more information on the potential opportunities and threats which Russia my present, kindly do contact Rian Geldenhuys.

© Trade Law Chambers 2012

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