TODAY IS TUESDAY, DECEMBER 12, 2017, 5:16:47 PM
VISUALLY VERSION
The Customs Inclines Foreign Manufacturers Towards Direct Deliveries

On September 14, senior executives of the Federal Customs Service (FCS) of Russia held a meeting with members of household appliances companies, marketing their products in the domestic market. The matter for discussions, arranged between the FCS and foreign business groups through the instrumentality of the Association (RATEK/РАТЭК), were the issues of customs clearance of import household appliances. The business invitees included principle foreign companies, representing worldwide trademarks: Samsung, Panasonic, Hitachi, Philips, Ardo, Candy, Bosch, Siemens, Sony, Archelik, Elektrolux, Loewe, Thomson, JVC, Toshiba, De’Longhi S.p.A, Sharp Electronics, Daewoo Electronics, Wirpool, Merloni Elettrodomestici.

On September 14, senior executives of the Federal Customs Service (FCS) of Russia held a meeting with members of household appliances companies, marketing their products in the domestic market. The matter for discussions, arranged between the FCS and foreign business groups through the instrumentality of the Association (RATEK/РАТЭК), were the issues of customs clearance of import household appliances. The business invitees included principle foreign companies, representing worldwide trademarks: Samsung, Panasonic, Hitachi, Philips, Ardo, Candy, Bosch, Siemens, Sony, Archelik, Elektrolux, Loewe, Thomson, JVC, Toshiba, De’Longhi S.p.A, Sharp Electronics, Daewoo Electronics, Wirpool, Merloni Elettrodomestici.

The session was opened by Tatyana Golendeeva, Deputy Head of the FCS. Her opening speech was as straightforward as tough. Recently the Russian customs authorities have applied significant efforts in establishing order in the area of abatement of “black” and “gray” import of household appliances. Implementation of measures of strict administration produced positive results, receiving recognition, including that of representatives of major world manufacturers, particularly that of “Samsung”, a South Korean company. Nonetheless, according to the executive opinion of the FCS, this problem still remains severe, including invalid declaration of imported goods in respect to various parameters, beginning from quantity and product range up to underdeclaration of customs value. The sensational affair, related to tons of “gray” mobile phones, delivered to Russia, merely confirms the truth. Ms.T.Golendeeva would not conceal complexity of the situation. Furthermore, the foreign manufacturers were fully and exhaustively informed about the care that has been taken with this problem by the two departments supervising the FCS of Russia, the Ministry of Economic Development and Trade and the Ministry of Finance.

In particular, exactly a week ago, specific and objective discussions were held between Mr. German Gref, Head of the Ministry of Economic Development and Trade and the FCS executive management in respect to the whole set of problems. The customs officers faced a difficult but clear task set for them – achievement by participants of foreign economic activity of authentic customs declaration of imported goods, including household appliances. In its turn, the customs service has already been actively involved into solving of this problem. Exemplifying is the Order of the FCS of Russia, № 727, dated June 28, 2004, providing for establishing of favored treatment for law abiding suppliers by way of a special procedure of customs value management. It was pointed out that the FCS will continue to increase the effectiveness of the application of this Order, including an extension to the range of goods, coming within the Order’s purview.

However, it necessitates a solution to a number of technical and organizational problems. At the same time, the said Order, in any case, it is unable to absorb a several thousand strong nomenclature of foreign economic activity. Under these conditions, the Russian customs service identifies the approach to adjustment of this situation as implementation of a set of measures, including differentiation of suppliers of household appliances. It will allow to discourage “fly-by-night” companies and to establish additional advantages for those participants of foreign economic activity, who keep strictly within the Russian legislation, showing willingness to do business transparently in relationship with the customs authorities. Even more so that normal practice of customs inspection, following release of goods, is ineffective in regard to “fly-by-night” companies. Yet, this problem will be solved by means of close cooperation with the customs authorities. It is not a long-run objective, but today’s reality.

In the framework of intended measures, the FCS of Russia calls upon foreign manufacturers of household appliances to switch over to direct supplies of their products to Russian market. Basically, the immediate understanding was expressed with regard to impracticability of this switchover within a tight schedule. And so, the customs service is prepared to make use of some other tools of making of legal import – submission to foreign manufacturers of lists of suppliers as intermediaries of manufacturers’ imports to Russia, as well as of pricing data with reference to products, released by these suppliers. Ms.T.Golendeeva imparted to the participants of the meeting the information pertinent to establishment of the price data acquisition center under the jurisdiction of the Ministry of Economic Development and Trade (MERT), serving as one of possible measures to be taken for identification of pricing criteria, and fully independent from the customs authorities.

Russian market operations of the company IKEA can be considered as an example of effectiveness of cooperation between business and customs; besides this company has fully changed over to electronic declaration of its products. In addition, Ms.T.Golendeeva offered to the invitees one more argument in favor of business “transparency” and authentic customs declaration. It was the judgment passed by the plenary session of the Supreme Court of the Russian Federation, dated July 26, 2005 in support of actions of customs officers taken in respect of identifying of customs value, and keeping within the Article 323 of the Customs Code of the Russian Federation and within the Federal Law “On Customs Tariff”.

During the meeting Mr. Alexander Voronin, Head of Main Administration of Federal Customs Revenue of the FCS of Russia (MAFCR) also took the floor. He commented on certain measures, being taken to secure of authenticity of customs declaration of imported household appliances. He expressed confidence that these measures would produce expected results. In so doing, he referred to similar measures being taken in respect of motor-car import and to close cooperation with foreign automakers. As an auxiliary condition of reality of proposed measures are the managerial measures being taken within the MAFCR. According to Mr. Alexander Koulak, Deputy Head of the MAFCR, at least one special unit is being set up with the view not only for ensuring of timely acquisition and processing of pricing data, but for bringing of this information to a customs inspector’ notice as well.

Extremely impressive for foreign business members was the floor of Mr. Nikolay Volobuyev, Deputy Head of the FCS, supervising the law-enforcement sector. At least based on past experience, determination to strictly suppress violations of Russian customs legislation is still evident. It should be noted that the invited representatives of foreign manufacturers of household appliances closely followed statements of officers of the customs service. Mr. Alexander Plyatsevoy, President of the Association (RATEK/РАТЭК) thanked customs service officers for the straightforwardness of their statements and comments and for their willingness not only for carrying on the dialogue but for direct cooperation with business circles.

In closing of the meeting, Ms. T Golendeeva thanked its participants and expressed hope that the information they acquired will serve as sufficient ground for taking specific decisions in respect of presenting the Customs with relevant pricing data, and of perspective and smooth transition of the manufacturers to practices of direct deliveries of household appliances to Russia. In any case, though the timescale, defined for transfer of pricing data to Russia, October 1, 2005, is little but still sufficient. There may scarcely be any other alternative to fiduciary cooperation between the Customs and business companies, though this way of cooperation does not close out strict control, exercised by authorities, called upon to defend interests of the Russian state.