Dana Zhunusova, Deputy Chairman of the Board of NCE RK "Atameken", answered questions about the level of Eurasian integration, on the labeling of goods in the EAEU and told about the existing barriers

- Dana Beysenovna, in the light of the last annual Forum "Eurasian Week" in Astana, what can you say about the level of Eurasian integration today?

- The program of the past Forum covered the main areas of integration work within the framework of EAEU - industry, international relations, labeling of goods, agriculture, etc. At the same time, as the thematic sessions showed, in theory the integration work in the Union is at a sufficiently high level and the degree of mutual harmonization between the member states of the EAEU at the level of RLAs allows us to speak with all responsibility about the Union. This is the coordinated policy in the agro-industrial complex, in the industrial sector, the Customs Code, technical regulations and certification, etc.

However, it should be noted that from a practical point of view, the results of integration do not reach the Union's main goal - the free movement of goods, works, services. For example, the complexity of the movement of agricultural goods between Member States, the lack of equal access to markets, the problematic nature of transit, the lack of a mechanism for recognition in certain areas, etc., give the issues of the movement of goods a character of excessive documentary overregulation. Although initially integration in the EAEU was designed to simplify the processes of trade turnover between the member states of the Union, to optimize the documentation and ensure the freedom of movement.

- What specifically do you consider excessive documentary regulation?

- We all observe the expanding agenda of Eurasian integration, the growing ambition of the Union's tasks, but at the same time, under the slogan "further, bigger, higher" we ignore the inefficient component of the obtained results, the real barriers to business in practice.

The agreement on the EAEC provides for harmonization in almost all areas of cooperation. In the first place, this is simplification of the processes of trade between the countries of the Union. However, in the pursuit of the control over the movement of goods, taking into account the requirements of each segment of economic interaction separately, for businesses operating in the EAEU area, today there is an excessive amount of required documents.

Moreover, in the situation of harmonization of processes, we forget that the administrative responsibility of entrepreneurs is different in the member states, and in most cases the measures provided for the absence of certain documents are disproportionately different.

According to the analysis, the list of documents necessary for moving products to the EAEU member states includes: veterinary / phytosanitary certificate; consignment note; certificate of origin; an application for the payment of indirect taxes; electronic invoice; certificate / declaration of conformity; in some cases a copy of the customs declaration, certified by the seal of the authorized state body of the Republic of Kazakhstan, etc.

At the same time, I would like to draw your attention to the fact that all these documents are provided on paper. In addition, some documents mutually exclude each other as a certificate and a declaration of compliance, which, on the whole, do not make any significant changes to the overall picture of the bureaucratization of the process.

Returning to the question of the lack of a package of documents necessary for mutual trade, one should not forget about the "sanction" policy, within the frames of which the Russian Federation is fighting against goods banned for transport by destroying them and prohibiting transit through its territory to other member states of the EAEU, not taking into account the interests and costs of its partners in the Union.

At the same time, the export of goods to third countries requires the existence of only a few documents, such as an international transport document, an invoice and a document confirming the safety of the products - a veterinary, phytosanitary certificate or a certificate of conformity.

In my opinion, the foregoing not only does not correspond to the principles of freedoms laid down in the Treaty on the EAEU, but rather contradicts the possibility of free movement of goods between the member states of the Union and does not contribute to the development of Eurasian integration and the growth of mutual trade, which in turn is a top priority of union work.

It is also worthwhile once again to highlight the problems of Kazakhstani exporters arising from the movement of goods to the Russian Federation, namely the difficulty in obtaining from Russian counterparts documentation confirming the import of goods to Russia, the availability of which gives the domestic entrepreneur the opportunity to recover previously paid taxes to the state revenue authorities and thereby reduce own expenses.

The Chamber repeatedly proposed the revision of the mechanism for paying indirect taxes within the framework of the EAEU by automating this process. However, with the general trend of simplifying tax administration, export-import relations between our entrepreneurs are still carried out on paper.

This is extremely inconvenient for entrepreneurs, since it requires time and financial costs, including because of the risks of not submitting a copy of the application on paper to the counterparty.

Summarizing the above, we can conclude that there is an excessive documentary burden on the business when moving within the framework of the EAEU in comparison with the list of necessary documentation for export to third countries. To crown it all, at the present time there is a prospect of expanding the list of control mechanisms in the Union by adding labeling requirements, and this clearly does not contribute to the development of practical Eurasian integration.

-  Speaking about the labeling of goods in the EAEU, what is the position of the National Chamber?

- For several years the Commission has been actively working on the implementation of the "total labeling strategy in the EAEU", which, unfortunately, also has consequences for the Kazakhstani business.

Initially, it was planned to launch the pilot in the labeling of fur coats. The need for a test mode of the project was Atameken's principled position in order to assess the benefits and risks for the business, and also in order to identify the expediency of its further implementation. However, not having had time to test it for Kazakh, Kyrgyz and Armenian entrepreneurs, the labeling was recognized by the Commission as successful, and therefore the project of total labeling was launched.

At present, at the insistence of the Commission, work is under way to adopt a basic Agreement on the labeling of goods in the EAEU. The document will become a permanent legal basis, allowing in the future to expand the list of goods to be marked, including unilaterally each country separately.

Today, the draft Agreement is at the stage of internal harmonization in the member countries of the Union. At the same time, I believe that the implemented projects within the framework of the EAEU, first of all, should promote the sale of products, the growth of trade between the members of the Union and the corresponding development of national economies. However, the introduced "total" labeling now resembles a barrier to business, creating additional requirements.

Moreover, the presence of a label will be a prerequisite for the movement of goods in the Union, which also expands the already substantial list of accompanying documents. At the same time, in the pursuit of "full traceability," the Commission does not calculate the possible costs and negative impact on the business of the EAEU countries.

The current situation shows that in the choice of "Business or the full traceability of goods flow", the EEC, to the great chagrin of the business environment of the Union, is inclined to favor the latter.

In my opinion, such a practice is essentially nothing more than the imposition of the responsibility of state bodies for control over the movement of goods that are not able to ensure fully such traceability on the shoulders of the conscientious business of the member states of the EAEU with all the resulting financial and other costs.

Moreover, the policy of "Eurasian traceability", which is implemented by the Commission, is very fragmented, thus, it also complicates and delays the processes. For example, the pilot project "labeling of fur products" is assigned to the EEC Trade Block, "traceability of goods" is supervised by the Customs Cooperation Unit, and the work on the project "Digital Agenda of the EAEU till 2025", in the future acting as a common monitoring platform, is conducted by blocks of domestic markets on informatization and information and communication technologies. 

It is worth remembering about the traceability of controlled products, the document circulation of which still remains on paper.

- What other projects implemented in the Union can become an additional burden for entrepreneurship?

- In addition to labeling goods, the Information System of Foreign and Mutual Trade has not yet brought practical benefits. The information exchange envisaged by the Action Plan is not established in many articles, which significantly complicates the trade processes for business. Most of the laid-down simplifications work only on paper. This is the exchange of phytosanitary certificates, certificates / declarations of compliance, collection of indirect taxes, etc.

At the same time, at present a draft Traceability Agreement is being negotiated on a domestic basis, which also provides for the exchange of information on goods transported through the territory of the Union using additional documents confirming the legality of the traffic.

In general, the trend of such initiatives, not envisaged by the Treaty on the EAEU, is a significant concern for Kazakhstani business, as it actually entails additional costs, a sharp decrease in profitability and new administrative barriers for the movement of certain goods across the territory of the Union.

I believe that all of the above initiatives have the ultimate goal of achieving maximum transparency and traceability of goods flows. In practice, such a situation is inciting the medium and small business of the republic, which does not have the material capacity to comply with all expensive procedures of marking and traceability, simply "go into the shadows" and thereby ensure survival in the conditions of relentlessly growing legal business in the EAEU.

Along with this, labeling promotes monopolization of the market by large "players" in this or that sphere, capable of fully providing labeling of goods. However, in this case, one should not lose sight of the potential risk of a corresponding increase in the cost of final products for the consumer.

Summing up, I would like to urge the Commission to conduct an audit of business processes for entrepreneurs of the EAEU countries, an analysis of the list of documents necessary for moving products within the "single market of the Union", and to consider the possibility of optimizing and simplifying the conditions for conducting trading activities.