The experts of the Atameken NCE RK discussed the activities of tour operators and travel agents within the framework of the EAEU Single Services Market.

In accordance with the EEC Supreme Council Decision No. 7 of 14 May 2018, the Single Market for Services (SMS) has been in force since 1 December 2019 for the EAEU member states. In the field of tourism, the SMS covers the activities of tour operators and travel agents. In this regard, representatives of the tour operators' and travel agents' market have many questions related to possible changes in their activities, as well as potential risks within the SMS.

To form a list of issues that needs to get explanations from the authorized bodies, a meeting was held in the Atameken NCE RK under the guidance of the Chairman of the Committee of the tourism industry of the Atameken NCE RK Pavel Kazantsev. The meeting was attended by representatives of the Department of Economic Integration of the Ministry of Tourism of the Republic of Kazakhstan, the Committee of Tourism Industry of the Ministry of Trade and Integration of the Republic of Kazakhstan, interested participants of the tourist market of all regions of Kazakhstan.

Pavel Kazantsev stressed that the Single market of services is already a reality, and all the issues, concerns of the market, the risks that may be exposed to the Kazakh tour of the company require the most rapid development.

Deputy Director of the Department of Economic Integration of the Ministry of Trade of the Republic of Kazakhstan Galymzhan Abulaisov explained the main provisions of the Single Market for Services.

"The establishment of the SMS was envisaged by the EAEU member states’ presidents when the EAEU Treaty was signed in 2014. The parties participate in the SMS based on their national regimes. This implies that a tour operator (travel agent) operating in its own country in accordance with the established procedure may operate in any EAEU country. The main conditions for the implementation of activities within the framework of the SMS are set forth in the Decision of the Supreme Council of the EEC No. 7. The first one is that tour operators and travel agents should be included in the state register of subjects of tourist activity in their country. Second, the parties have indicated that in terms of consumer protection, the provision of services within the SMS is carried out in accordance with the legislation of the EAEU member state. Currently, Kazakhstan, Belarus, and Russia have joined the Single Market, and Armenia and Kyrgyzstan will join in as soon as they are ready,” Mr. Abulaisov said.

He also noted that the national regime provides for non-discrimination against entities from participating countries and the absence of requirements for the establishment of a legal entity. At the same time, the requirements for payment of taxes remain in accordance with the national legislation of Kazakhstan.

Representatives of the Tourism Industry Committee spoke about the draft Agreement on Administrative Cooperation, which provides for the exchange of information between the authorized bodies of the EAEU countries regarding the subjects of the tourism market in each country.

Market participants voiced a number of questions and risks that arise in the context of the SMS.

First of all, the market sizes of the participating countries are different. Accordingly, there are larger and stronger market players, as well as different financial requirements for them. This means, for example, that tour operators in the field of outbound tourism from the Russian Federation will be able to enter the Kazakh market more easily than Kazakh tour operators in the Russian market, as financial requirements for travelers in the Russian Federation are much higher.

Secondly, the question of the mechanism that allows a tour operator from another country to pay taxes in Kazakhstan and vice versa without creating a legal entity arises.

In the third, how and under what conditions will the travel agent from Kazakhstan cooperate with the tour operator of another country and vice versa? In particular, questions were raised regarding the conclusion of the contract, payment, taxation, and resolution of disputes between the subjects. Where to apply and what the authorized body advises on all matters of activity in the SMS.

Another risk, which is noted by representatives of the market, concerns the freedom of activity of travel agents, for which there are practically no entry barriers. At the same time, there is still a high risk of creating one-day companies and deception of consumers in this area.

Abulaisov commented that there are always risks of fraud to a greater or lesser extent, but the interaction of the authorized bodies of the participating countries should work effectively.

The Chairman of the meeting Pavel Kazantsev, in his turn, expressed concerns about the correctness of the information in the registers of subjects of tourist activities of the EAEU member states.

Experts also expressed the question of whether tour operators of inbound tourism from other countries will be able to invite foreign tourists to the country, carrying out activities in Kazakhstan. In particular, the representative of the authorized body asked who would be responsible for the tourist who violated the laws of the Republic of Kazakhstan, which is not welcomed by the Kazakh tour operator, and the tour operator from another EAEU country.

Given a large number of questions raised during the meeting, Pavel Kazantsev asked market participants to send all questions, concerns, and risks to the Atameken NCE RK within two days for further work with the authorized bodies.