The EAEU is preparing large-scale labeling of goods. Business has raised concerns

The Council of the Eurasian Economic Commission (EEC) approved the draft agreement on the labeling of goods. This message aroused concern among Belarusian entrepreneurs, because stories about disputes over the implementation of union technical regulations are memorable.

The countries of the Eurasian Economic Union (EAEU) already have several national systems for labeling goods. In 2016, an allied experiment was launched to mark fur products with RFID tags. “This project has had a significant effect, we see from the statistics. In 2016, compared to 2015, the volume of fur garments imported to Belarus from third countries increased by 30%, the customs value - by 24%,” said Vladimir Mukvich, Deputy Minister for Taxes and Duties of Belarus. Due to the fact that the mechanism proved to be positive, which is especially evident in the Russian market, the tax authorities began to work to expand the list of labeled goods.

The new draft agreement provides for the creation of a mechanism for marking goods on the customs territory of the EAEU, tracking them and maintaining a unified register of marked goods. “In accordance with the proposed draft agreement, goods must be marked with identification means unified within the EAEU, information about which will be entered in a single register. The EEC should form and maintain a register,” the EEC said in a statement. They believe that the agreement will be signed by the heads of state of the union before the end of 2017.

The decision on labeling can come into force 90 days after its official publication by the council, and non-labeled products will be banned from circulation. Labeling of imported goods is carried out before customs (it can be carried out outside the customs territory of the union). Manufacturers of goods will mark them before transportation and sale, Kommersant writes. The states will also have to notify the council of the commission about the goods that they label outside the union agreements. At the same time, if several countries mark the same groups of goods, they will be able to control their circulation through the information system of the union. Another novelty of the agreement is that it de facto recognizes the EAEU marking as a replacement for the current accompanying documents for cross-border trade.

Currently, the EEC is holding public discussions on the list of goods for which it is advisable to introduce labeling by means of identification. Recommendations have already been received from the business community and authorized bodies of the EAEU countries on the inclusion of footwear, medicines and jewelry in the list, the EEC said in a statement.

Expert industry groups are currently meeting to consider the practice of labeling goods, determine specific commodity items for which it is advisable to introduce labeling, optimal technologies for their labeling, and also assess the expected benefits and possible preferences for market entities of goods subject to labeling, the EEC explained.

Anatoly Zmitrovich, DIRECTOR of the analytical center of the Republican Confederation of Entrepreneurship, notes that “when the national governments formed expert groups, representatives of business communities, including individual entrepreneurs, were not invited to participate in these discussions: i.e. entities that will be responsible for the sale of goods with labeling. According to him, this is absolutely identical to the practice of developing and adopting technical regulations, the introduction of which business entities faced numerous problems.

Last week, the NGO "Perspektiva" received a questionnaire from MART and the Ministry of Taxation of Belarus regarding the need to label shoes. For the most part, the Ipeshniks did not support such an initiative. “The fundamental decision has already been made: shoes will be marked. Now the type of marking is being discussed (barcode, QR code, DataMatrix code, RFID tag, “bubble” - Note TUT.BY),” said an informed interlocutor.

Sources in the footwear industry note that the application of the label is "lobbied by RUSSIA to clean up the market for itself." One of the Belarusian retailers is confident that the labeling will increase the costs of producers and consumer prices. The beneficiaries are labeling system manufacturers and large database storage operators.

The HEAD of the Russian Ministry of Industry and Trade, Denis Manturov, expressed the hope that the implementation of the agreement on labeling goods will stop counterfeiting and smuggling in the EAEU worth billions of dollars. “The volumes of counterfeit and smuggling in the EAEU amount to billions of dollars and limit the development of honest business. As a systemic solution to this problem, it is proposed to widely introduce labeling of goods produced and imported into the territory of the EAEU,” Manturov said.

“There are fears that the retail trade sector of the EAEU countries will be engaged in the labeling procedure (chipping) and the preparation of documentation (product certification). This will mean that a business entity engaged in retail trade, instead of customs and fiscal authorities, will fight against the identification of counterfeit products, but also deal with its legalization, Zmitrovich believes. “Isn’t the procedure for introducing labeling a kind of smoke screen, impotence and inability of the relevant authorities to put an effective barrier to illegal imports?”

Belarus is creating a system of traceability of the turnover of goods. This will increase the cost of small business