The Customs Union is what? The states of the Customs Union

The customs union is formed with the purpose of creatinga single territory, and within it there are customs taxes and economic restrictions. The exception is compensatory, protective and anti-dumping measures. The Customs Union implies the application of a single customs tariff and other measures designed to regulate trade in goods with third countries.

Definition

The customs union is the union of severalStates Parties that conduct joint activities in the field of customs policy. Customs duties and borders between participants are also abolished, and for other states a single customs tariff is introduced.

History

The first such union arose in the nineteenth century, with the participation of France and Monaco.

At the beginning of the twentieth century, the CustomsThe union is Switzerland and the Principality of Liechtenstein. Also, as an example, the conclusion of the General Agreement on Tariffs and Trade in the twentieth century, the European Economic Community was established in 1957, which eliminated all restrictions on trade between participants, and a common customs tariff for trade with third countries was created. In 1960, the European Free Trade Association was formed, which abolished taxes on customs and quantitative restrictions on the trade of members of the association.

In the EEC and EFTA countries,there are differences in customs regulations and there are no common duties in trade, in the socialist countries there is no Customs Union, but agreements have been concluded that presuppose cooperation and mutual assistance on customs issues.

Single documents, methods and forms were introducedregistration of cargo as exhibition and fair. Agreements were signed to simplify their registration at customs. These agreements accelerate the movement of goods, strengthen the world market and prevent all kinds of violations.

In 2010, a single Customs Union waswhich included Russia, Kazakhstan and the Republic of Belarus. This implies the creation of a single customs territory and provides all control functions.

This year, Kyrgyzstan joined the Customs Union, while Russia is strengthening its positions.

Adoption of the Customs Union

On October 6, 2007, the Treaty between the Russian Federation, the Republic of Belarus and Kazakhstan was concluded on the transition to a single Customs Union.

Since July 1, 2010, in accordance with the customs code, the unified customs territory of the three member countries has started functioning.

Eliminated declaring and registration at customson the borders of these three states. Goods can be moved without registration, which eliminates the emergence of costs. They move much easier and reduce the cost of delivering goods.

In the future, the UnifiedEconomic Space (SES) with a functioning single market of services, which, in addition to trade, includes services and a host of other areas of activity.

The year 2015 of the Customs Union was marked by a newevent. The entry of the next member of the organization introduces some changes in geopolitics. And the new structure of the organization Customs Union (Kyrgyzstan, Russia, Kazakhstan and others) will expand trade relations in the TC countries.

General information

The customs union is an association aimed atincrease of economic level in the participating states. The created market has more than 180 million people with a turnover of 900 billion dollars.

The conclusion of the Customs Union allowed the goods to move freely throughout the territory with the effect of universal control.

If the fact of export is documented, excises are not required to be paid, and the VAT rate is zero.

In the case of import of goods to Russia from Kazakhstan and Belarus, Russian tax authorities levy excises and VAT. The customs union is an easy and profitable form of interaction.

Composition

Participants in the organization of the Customs Union (Customs Union):

- Russia and Kazakhstan (since July 1, 2010).

- Belarus (since 06/07/2010 year).

- Armenia (since 10/10/2014).

- Kyrgyzstan (since 08/05/2015).

Candidates for the entry:

- Tajikistan.

- Syria.

- Tunisia.

Accession to the Customs Union of Candidate Countriesis considered in the near future. The expansion of the organization can improve the world market. The entry of candidate countries into the Customs Union (Tajikistan, Syria, Tunisia) is a prospect for more developed countries by expanding their positions.

Governing bodies

The supreme governing body is the International Councilheads of state and government. Also, according to the agreement, the Commission of the Customs Union was established, which is a permanent regulatory body.

The highest bodies of the institution in 2009 carried out complex measures that allowed to consolidate the contractual and legal basis of the Customs Union.

According to the decision of the presidents of the countries-participants of the unionan economic commission was established as a permanent regulatory body of supranational government, which is subordinate to the Higher Eurasian Economic Council.

Main advantages

The main advantages of the Customs Union for business entities in comparison with the free trade zone are:

• In the territories of the Customs Union, expenses for the creation, processing and movement of goods have significantly decreased.
• The costs of time and finances arising from administrative barriers have diminished noticeably.
• The number of customs procedures that are mandatory for passage when importing goods from third countries has declined.
• New markets for goods became available.
• Unification of the customs legislation has led to its simplification.

The Customs Union and the WTO

In the process of creating the Customs Union, many concerns were voiced about the contradiction of the rules of the Customs Union with the WTO rules.

In 2011, the organization summed up all its standards to full compliance with WTO standards. If the states of the Customs Union join the WTO, the WTO rules will be considered as priority.

In 2012, Russia joined the WTO, which led to theupdating of the Uniform Customs Tariff for the countries of the Customs Union in accordance with the requirements of the WTO. The level of 90 percent of import duties remained the same.

Internal conflicts

In November 2014, the importation of meat fromBelarus to Russia. The volume was about 400 thousand tons. At the same time, the Russian side took measures to tighten control over goods that cross the Belarusian border, which contradicts the simplified rules for the carriage of goods operating in the territory of the Customs Union.

Observers noted a good combinationmechanism of the Customs Union and the mechanism of re-export of banned European goods to Russia. For example, the import of fish from Belarus, which is landlocked, to Russia increased by 98 percent.

Belarusian President A.G. Lukashenka was outraged by the bans of the Russian side and accused Russia of violating the rules of the Customs Union and disregard for the norms of international rights.

By the marks of observers, there is an item in the rules,according to which, in case of imposing restrictions on the part of Russia on trade and transportation of goods, the Belarusian side has the right not to comply with the terms of the contract.

In 2015, Belarus returned to the Russianborder control, thereby violating the terms of the agreement of the EAEC. Also, it was announced that the ruble is likely to be abandoned both from the settlement currency and the return of settlements in US dollars. Russian experts believe that in such a situation regional integration is under attack.

Criticism

In 2010, opposition forces attempted to organize a referendum for denouncing the agreements. Kazakhstan made a claim about infringement of sovereign rights.

Also critical comments of the Customs Union were made on the following items:

• Terms of trade and certification of goods are poorly worked out.
• The terms of the WTO have been imposed by Russia on Kazakhstan and Belarus, which are not members of the above-mentioned organization.
• Incomes and receipts are allegedly unjustly distributed among the participating countries.
• The Customs Union is not favorable as a project to current and potential participants.

Meanwhile, studies indicate that, for a number of ideological reasons, the Customs Union benefits its participants in varying degrees.

The view was also expressed that the Customs Union is a phantom, it is not viable as an artificial political entity.

Opinions in the society

In 2012, the Center for Integration Studiesat the Eurasian Development Bank a sociological survey was conducted. The survey involved the CIS countries and Georgia. A question was asked: "What do you think about the fact that the economies of Belarus, Kazakhstan and Russia have united?". The following answers were received from the countries entering and claiming to join the customs union:

- Tajikistan: "positive" 76%, "indifferent" 17%, "negative" 2%.

- Kazakhstan: "positively" 80%, "indifferent" 10%, "negative" 5%.

- Russia: "positively" 72%, "indifferent" 17%, "negative" 4%.

- Uzbekistan: "positively" 67%, "indifferent" 14%, "negative" 2%.

- Kyrgyzstan: "positively" 67%, "indifferent" 15%, "negative" 8%.

- Moldova: "positive" 65%, "indifferent" 20%, "negative" 7%.

- Armenia: "positive" 61%, "indifferent" 26%, "negative" 6%.

- Belarus: "positively" 60%, "indifferent" 28%, "negative" 6%.

- Ukraine: "positively" 57%, "indifferent" 31%, "negative" 6%.

- Azerbaijan: "positively" 38%, "indifferent" 46%, "negative" 11%.

- Georgia: "positively" 30%, "indifferent" 39%, "negative" 6%.

Expert opinions

According to the Secretary of the Commission of the Customs UnionSergei Glazyev, TC is beneficial both in terms of geopolitics, and in terms of economics. This is an important achievement that gives many undeniable benefits to participating States.

According to the head of FTF of Russia AndreyBelyaninov at the conference in 2009, the Customs Union at the beginning of its functioning will create problems for business and customs authorities, but this is nothing more than a transitional period.

President of the Republic of Belarus Alexander Lukashenkodefines the Customs Union as the next step towards creating a single economic space that will be the correct form of economic relations between the participating countries.