Federal Customs Service issues clarifications on higher import duties for certain categories of goods

6 September 2022
Tax Messenger
Letter No. 05-19/K-8156 of the Federal Customs Service of 17 August 2022 (“FCS Letter”) presents guidance on the application of import duty rates set by Government Decree No. 788 of 6 July 2018 (“Decree No. 788”), which differ from the Unified Customs Tariff of the EAEU.

It will be recalled that Decree No. 788 set higher rates of import customs duties – ranging from 25% to 40% – for a wide range of goods classified in chapters 82 and 84 of the EAEU Goods Nomenclature (TN VED EAEU), as well as certain subheadings of chapters 87 and 90 of the TN VED EAEU, that originate in the USA and are imported into Russia.
In particular, it is stated that, if there is no proof of origin for goods listed in Decree No. 788, the higher import duty rate approved by that decree should be applied to the goods concerned. Lack of proof of origin for goods means a situation where the importer is unable at the declaration stage to provide documents confirming the country of origin of goods (a declaration/certificate of origin).

Example: A company imports a product listed in Decree No. 788 from Germany into Russia. The country of origin of the product is Germany. However, when importing the product into Russia the importer did not provide a document proving the product’s origin to the Russian customs authorities. In this case the country of origin would be considered unproven and higher customs duty rates may be applied to the product concerned.

We should point out that, in 2018, after Decree No. 788 entered into force, the customs authorities stepped up customs control in relation to goods with TN VED EAEU codes listed in Decree No. 788. That control was directed not only at goods originating in and/or imported from the USA, but also at goods originating in and/or imported from other jurisdictions. As a result, in cases where proof of origin was not provided, the customs authorities imposed higher import duty rates (from 25% to 40%). As time went on, however, the level of attention paid to this issue decreased and the focus of the customs authorities shifted to other areas of control (such as checking origin documents for goods that may potentially be subject to ant-dumping duties).

However, in light of the publication of the FCS Letter, and given the conservative nature of current administrative practice and the large number of checks made by the customs authorities (mainly after goods have already been cleared), it cannot be ruled out that the customs authorities will resume heightened scrutiny of proof of origin for goods listed in Decree No. 788.

It should be noted that the customs authorities currently pay close attention to the proper execution of documents and often refuse to accept them from importers on purely formal grounds, imposing additional customs charges and anti-dumping duties. In view of this fact, we advise companies to take particular care to ensure that proof of origin documents meet the requirements of EAEU customs law.
How B1 can help

  • Providing support in proving the country of origin of goods
  • Assessing whether origin documents have been properly executed from an EAEU customs law perspective and recommending any changes that might be needed
  • Supporting Russian companies in liaising with foreign suppliers to ensure that documents are executed in accordance with EAEU rules
  • Support with customs audits
  • Appealing against decisions and actions/omissions of the customs authorities to higher customs authorities and to the courts

Authors:
Ksenia Sizova
Senior manager
Global trade and Customs
Alexandra Gorokhova
Senior
Global trade and Customs
Nikita Fedotov
Staff
Global trade and Customs
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