Public Statement of the Ministry of Finance concerning the Start of Implementation of the Interim Agreement on Trade and Trade – Related Matters between the European Communities and the Republic of Serbia

At its session held on 16 October 2008, Government of the Republic of Serbia adopted a Conclusion that stipulates that implementation of the Interim Agreement on Trade and Trade-Related Matters between the European Communities, of the one part, and the Republic of Serbia, of the other part, will start as of 01 January 2009. The objective of this measure is to reduce the period of time that needs to expire between the start of application of the Interim Agreement and the granting of the candidate status to Serbia.

Full trade liberalization will be completed within six years, by 01 January 2014. The tempo of liberalization may be accelerated, depending on the economic situation.

Serbia has enjoyed a preferential status regarding exports of goods into the EU as of 2001, due to Autonomous Trade Measures approved by the EU (Council Regulation 2007/2000), which allow for completely free exports of goods originating in Serbia to the EU market. This regime will be effective up until 31 December 2010. With coming into force of the Stabilization and Association Agreement, these measures will be translated into measures regulated by the Agreement, that is, they will become contractual obligations.

At its session held on 16 October 2008, Government of the Republic of Serbia adopted a Conclusion that stipulates that implementation of the Interim Agreement on Trade and Trade-Related Matters between the European Communities, of the one part, and the Republic of Serbia, of the other part, will start as of 01 January 2009. The objective of this measure is to reduce the period of time that needs to expire between the start of application of the Interim Agreement and the granting of the candidate status to Serbia.

Full trade liberalization will be completed within six years, by 01 January 2014. The tempo of liberalization may be accelerated, depending on the economic situation.

Serbia has enjoyed a preferential status regarding exports of goods into the EU as of 2001, due to Autonomous Trade Measures approved by the EU (Council Regulation 2007/2000), which allow for completely free exports of goods originating in Serbia to the EU market. This regime will be effective up until 31 December 2010. With coming into force of the Stabilization and Association Agreement, these measures will be translated into measures regulated by the Agreement, that is, they will become contractual obligations.

For Serbian economy, this means specifically the possibility to import industrial and agricultural products originating in the EU without paying customs duties or by paying reduced customs duties than those stipulated by the Customs Tariff Law.

Due to importance of agricultural products, they are entitled to a slower tempo of trade liberalization: around 35% of agricultural products will be subject to duty-free imports immediately upon the start of implementation of the agreement, while trade liberalization for other agricultural products will take place in line with the dynamics envisaged by the agreement. Furthermore, no concessions have been made for a number of products (sugar, tobacco, vine – above the 25,000 hl quota).

Degree of liberalization will be higher for industrial products. All industrial products are categorized into four groups by their sensitivity: non-sensitive, sensitive (list a), highly sensitive (list b) and extremely sensitive (list c). In this way, immediately after the start of application of the agreement, some 65% of industrial products will be imported duty-free (non-sensitive products). As regards other industrial products, customs duties will be reduced in line with the dynamics defined by the agreement:

Annex I

2009

2010

2011

2012

2013

2014

List (a)

70%

40%

0%

0%

0%

0%

List (b)

80%

60%

40%

20%

0%

0%

List (c)

85%

70%

55%

40%

20%

0%

 

In order to claim the right to import duty-free goods or to pay reduced customs duties on goods originating in the EU, it is necessary to submit a proof of origin (EUR.1 certificate) to the relevant customs house at the time of imports.

For proper implementation of the Interim Agreement, i.e. for proper application of customs duties in line with the agreement when importing goods originating in the EU into Serbia, the Ministry of Finance has prepared an Instruction that contains tariff classifications and related customs duties, which will apply as of 01 January 2009. The Instruction will be published on the website of the Ministry of Finance.