On October 30 this year at the NCE RK was held a meeting on the pilot project for the introduction of labeling of fur products with the participation of government agencies, major importers and manufacturers. During the meeting the sides exchanged views and information on the current readiness of Kazakhstan to implement the pilot project. In addition, business representatives expressed their positions on the practical application of the rules laid down in the Agreement, as well as draft documents, which are to be approved.

At the insistence of the Kazakh side, labeling of goods is introduced in the pilot mode. On 8^th of September  in the city of Grodno, Belarus was signed an agreement on the implementation in 2015-2016 of a pilot project for the introduction of labeling control (identification) signs on the heading "Articles of apparel, clothing accessories and other articles of fur". Currently under internal procedures the ratification of this Agreement is being on.

The rules of Agreement prohibit to acquire, to store, to use, to transport and to sell the goods included in the List, without control (identification) signs. In the pilot mode will be labeled garments of mink, nutria, fox, fox, rabbit / hare, raccoon and sheep (7 ten-digit HS codes).

Taking into account that the agreement directly affects the interests of business and the impact on the business environment, NCE RK took the initiative to discuss the rules of the Agreement and the mechanism of the implementation of the pilot project in Kazakhstan.

It should be noted that for the implementation of the agreement in November of this year at the Council of the Eurasian Economic Commission it is expected technical documents will be approved and they will become a supranational regulatory basis for the launch of a pilot project. These documents regulate the uniform requirements for the reference mark, which will be labeled on fur products, as well as requirements for importers and manufacturers of fur products.

NCE has repeatedly stated that the requirements of supranational laws are cumbersome and too complicated for the entrepreneurs during the pilot project. In general, it is necessary to understand that the implementation of the conditions prescribed in the basic instruments will depend on the ultimate viability and success of the introduction of labeling in the Union. The official position of the NCE were announced by the experts of the Department of Economic Integration, and Deputy Chairman of the Board Zhunusova D.B. in the course of the negotiations and on the harmonization of standards for the introduction of labeling.

If we talk about control digits, it should be noted that the requirements for such signs suggest the use of RFID technology - Radio Frequency Identification (RFID). This proposal was included at the insistence of the Russian and Belarusian sides to recognize control digits when handling goods on the territory of the Union.

RFID-tags - modern information technology, but it is necessary to understand that for Kazakhstan because of lack of widespread RFID Technologies, in contrast to our neighbors, which launched production of such labels, the use of RFID-tags is a certain complexity.

In addition, we must not forget that the use of RFID-tags will have a direct impact on the final cost of such reference marks, which, in turn, affect the cost of goods for consumers. And today it is difficult to answer the most important question: how much will it cost a telltale sign for the entrepreneur? One can only hope that the price of the reference mark will be "dissolved" in the value of coats.

Equally important is the work of the information system of marking, which suggests that each importer / manufacturer of fur products will have access to the system and will input all the data about the goods in personal cabinet in the system (about 14 different information fields).

At this stage, the most interesting begins. Information labeling system is based on the standards of the World Association of Automatic Identification GS1. Entrepreneurs engaged in the import and production of fur products, shall transmit to the system Global Trade Item Number (GTIN) and the GLN an identifier of the manufacturer of the goods, which are formed by the Association of GS1.

Reference: GS1 - a voluntary non-profit association, represented by national organizations in 108 countries. After the merger in 2005 of systems EAN (European Article Numbering) and UCC (Uniform Code Council) into one association it got a new name. The name Global Standards One (GS1) - says the use of common standards which are used by more than 1 million companies that are members of GS1.

GS1 International manages a diversified system of commodity numbering and bar coding standards, to identify and to transmit information about products, services, enterprises, transport units, the address data.

In Kazakhstan there is Association of Automatic Identification GS1 Kazakhstan, which assigns identification numbers of goods and services, starting with the digits 487, issued and registered in GS1 Kazakhstan in accordance with the General Specifications of GS1.

It should be noted that for these codes, you must be a member of the Association and to pay the admission fee and annual membership fee, the level of which varies in a corridor of 150 to 350 US dollars. Thus, to the cost of labeling, in addition to price control mark, added value and use of GS1standards.

During the discussion, after informing the administration about the alleged scheme, labeling in Kazakhstan, business representatives expressed the view that the best option when importing fur products would be an opportunity to carry out all necessary procedures for the labeling of goods for customs clearance in customs warehouses. This form of cooperation is acceptable for importers and would eliminate the extra costs for businesses.

According to government officials and "NIT", a number of issues of the pilot project in Kazakhstan remain unresolved. At present, possible options and resulting changes in national legislation in connection with the implementation of the pilot project, which will be submitted to the NCE, are being discussed.

Serious concerns were expressed by the head of the Kazakhstani fur trade association Vedyashev S.A. related to "gray" imports and the possible overflow of contraband products on the market of Kazakhstan from neighboring countries. Representatives of the Ministry of Finance, in turn, stressed that the labeling should become an effective instrument in the fight against smuggling of goods and will allow not only to monitor the movement of goods on the territory of Kazakhstan, but also to share information on goods labeled with the Member States in cross-border trade.

Nevertheless, there is still a lot of work. Time left until the introduction of the pilot project is very short - April 1, 2016 should start to function an information system of labeling. The meeting it was agreed to hold another meeting next month for a more detailed discussion of optimal and acceptable business option for introducing labeling in Kazakhstan.

Reference: RK import of fur products on commodity positions included in the list of goods subject to labeling, in 2013 amounted to 59,637 units totaling 6 634.9 thousand USD. In 2014 the figure was 27 150 pieces in the amount of 3 222.8 thousand US dollars. For 8 months of this year furs were imported in the amount of 1874 thousand US dollars.

Export of furs in the countries of  EAEU (Russia) on these items in 2013 amounted to 13,210 units in the amount of 2 338.3 thousand US dollars, in 2014 - 34,126 units  in the amount of 1 478.7 thousand US dollars and 8 months of 2015 - 208 units in the amount of 1.7 thousand US dollars.