Kazakhstan Chamber of Commerce in the USA


Customs Union

Posted on September 06, 2010 by KazCham

A series of international agreements and legislation effective in the Customs Union member states (i.e., Kazakhstan, Russia and Belarus) came into force as of 1 July 2010, introducing changes to the customs and tax legislation of Kazakhstan. This includes the Customs Code of the Customs Union (“CU Customs Code”), Agreement on levy of indirect taxes within Customs Union territory , etc.

The Government adopted the new Code of Customs Affairs in the RK (“Customs Code of RK”) based on the CU Customs
Code. The changes included amendments to the Tax Code with respect to VAT on transactions within Customs Union.

Legislation relating to the Customs Union is subject to mandatory publication on the Customs Union Committee website: www.tsouz.ru which represents the Customs Union’s official publishing authority.

Customs legislation

The CU Customs Code shall regulate cross border economic operations involving Customs Union member states
and third countries. Issues which are not regulated by the CU Customs Code shall be governed by the Customs Code of RK.

The CU Customs Code, as an international treaty, shall prevail over the Customs Code of RK.

The main changes to the customs legislation include:

  • Introduction of the definition of an authorized economic operator. An authorized economic operator is a legal entity meeting certain requirements, and which is entitled to use special simplified procedures for customs
    clearance, including the right to release goods into free circulation prior to customs clearance and the right to temporarily store goods in their territories. To qualify as an authorized economic operator certain conditions must be met; including guaranteeing customs payments of Euro 1 million and having performed the foreign economic activity for at least two years.
  • Increase in the term for settlement of the deferred customs payments. The term for settlement of customs payments in relation to conditionally released goods has been increased from three to five years. Similar to the previous legislation, there is a list of goods and requirements to be met to qualify as conditionally released goods.
  • Introduction of the procedure forclassification decision on Foreign Economic Activity Commodity Nomenclature of the Customs Union. When submitting a customsdeclaration, a declarer mustclassify the related goods according to the Foreign Economic Activity Commodity Nomenclature of the CustomsUnion. The customs authorities shall review the correctness ofthe classification and, if mistakesare identified, they can reclassifythem.
  • The customs authorities can also provide clarification of classifications of individual types of goods and these clarification must be published. Preliminary classification decisions, issued bythe Kazakhstan customs authorities, shall only apply to Kazakhstan. The Customs Union Committee is empowered to cancel preliminary classification decisions issued by the Kazakhstan customs authorities.
  • The suspension of certain customs legislation provisions for subsoil use contracts. With respect to subsoil use contracts signed before 1 July 2010, the customs regime in force at the time of the conduction of the contracts should be applied in the certain areas of the customs regime, provided that subsoil use contracts contain certain provisions.
Please note that the customs control at the Kazakhstan-Russia borders is prolonged till 1 July 2011 and is solely for the
gathering of statistics in cross border traffic.

Please note that the customs control at theKazakhstan-Russia borders is prolongedtill 1 July 2011 and is solely for thegathering of statistics in cross bordertraffic.

SOURCE: Tax & Legal Alert, Pricewaterhouse Coopers Kazakhstan • Issue No 13 • August 2010

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