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General information about Trade Facilitation Agreement (TFA)

The enormous amount of “bureaucracy” has always been an additional burden for traders when moving goods across borders. Therefore, the promotion of trade itself– simplification, modernization and harmonization of export and import processes – has become challenge for the world trade system.

On 7 December 2013, members of the World Trade Organization concluded negotiations regarding Trade Facilitation Agreement (hereinafter referred to as the Agreement, or TFA). On 27 November 2014, the WTO General Council formally adopted an amendment protocol for the Trade Facilitation Agreement.

The main objectives of the TFA which determine obligations of Member States are to reduce time and cost of customs control, enhance transparency and efficiency of government transactions, increase trade flows, public revenues and foreign direct investments, decrease level of corruption, expand cooperation between private and public sectors, improve small and medium business.

The provisions of this Agreement are mostly in line with those of the International Convention on Simplification and Harmonization of Customs Procedures (the revised Kyoto Convention of the World Customs Organization). However, the TFA, like all WTO agreements, deals with a whole range of trade issues, and not only customs procedures.

The Agreement came into force after its ratification by two-thirds of the WTO members (110 out of 164), which took place on 22 February 2017.

Ukraine ratified TFA on 04.11.2015 (Law of Ukraine “On ratification of the Protocol amending the Marrakesh Agreement Establishing the World Trade Organization” No. 745-VIII of 04.11.2015), which significantly improved its image in the WTO and became a signal for the international trade and investment community about seriousness of Ukraine’s intentions to improve its trade and investment climate.

The period required for implementation of the Agreement and entry into force of separate provisions is determined individually for each country, depending on the state of economic development (developing or least developed country) and category of obligations:

- category A – provisions determined by a Member State for implementation since entry into force of the Agreement (or, in the event of least developed countries, within one year upon entry into force of the Agreement) – Ukraine notified the WTO of TFA provisions in category A and provided preliminary information on categories B and C on 14.08.2014;

- category B – provisions determined by a Member State for implementation after the transitional period required for their implementation. Ukraine notified of the deadlines of implementation in category B on 04.01.2018 (according to the TFA schedule within one year upon entry into force of the Agreement);

- category C – provisions for which implementation a Member State needs the transitional period and appropriate technical assistance to form or strengthen appropriate capacity. The updated information on the terms of implementation of provisions notified in category C was provided by Ukraine on 22.05.2018 (according to the schedule within 2.5 years upon entry into force of the Agreement).

In addition, Ukraine shall report on the progress in the implementation of activities notified in category C by 22 August 2019.

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