EU-Ukraine disputes: A new attempt to solve the problem of timber exports

Author : Yulia Khort

Source : 112 Ukraine

Ukrainian MPs are once again trying to solve the conflict with legislation banning the export of forest products, but their approach does not comply with the international law
10:00, 13 April 2017

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Ukrainian MPs are once again trying to solve the conflict with legislation banning the export of forest products – generally, the approach is correct, but again legislators has not correlated it with the international law.

So we have another bill that was intended to resolve the issue of the moratorium on the export of forest (remember this is a very acute problem in relations between Ukraine and the EU, since the moratorium was introduced in violation of all Kyiv’s possible obligations in this area). And the final bill contains the same mistakes as the previous ones.

This is a bill №6035 "On amendments to some laws of Ukraine concerning the settlement of certain matters of economic policy." It proposes to cancel the temporary ban on the export of timber, introduce the state registration of foreign economic contracts for such exports temporarily, until January 1, 2020, to set export duties on timber, these 15% of their value. The authors of the bill believe that these measures will resolve the problems in relations between Ukraine and its partners treaties - the WTO and the EU.

Related: 7 arguments against export of Ukrainian roundwood

However, the Association Agreement with the EU provided that the parties should not impose any export duties (Article 31). Also, the document stipulates that neither party should adopt or maintain any prohibition or restriction on imports of any goods for other party (Article 35).

Indeed, there are exceptions to the rule - in Article 294 of the Treaty states that in order to promote sustainable forest management, "the parties undertake to work together to improve law enforcement and governance in the forest sector and promote trade legal and sustainable forest products."

There is also a provision of the General Agreement on Tariffs and Trade (GATT)/ WTO, which allows certain export restrictions in order to "conserve natural exhausted resources, if such measures are applied with restraint of domestic production or consumption."

In fact, no one disputes - there is an urgent problem of preserving forests in Ukraine, our country could use the rules of GATT, but legislators do not meet the main condition: export restrictions are possible only with the introduction of appropriate restrictions of domestic production and domestic consumption of forest products.

This condition is again ignored.

Related: Round wood export ban is only reason why EU blocks financial aid for Ukraine

The initiative to introduce the state registration of foreign economic contracts only in this area does not comply with the principles of EU policy aimed at eliminating unnecessary barriers and business deregulation.

In addition, the bill is inconsistent with the article 13 of Memorandum of Understanding between Ukraine as a lender and the EU as a borrower and does not comply with the loan agreement between Ukraine and the EU (to obtain macro-financial assistance amounting to 1 billion 800 million euros).

As you know, the conditions of allocation of the second tranche foreseen the need for Ukraine to refrain from introducing new measures that restrict or distort trade, according to Ukraine's WTO commitments.

That is contradictory legislative initiatives distorts the image and provokes the financial losses. And it does not fulfill the declared goal of normalizing relations with the EU and WTO.

Related: 29 wagons of roundwood arrested on Transnistria border

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