1. Eurasian Economic Commission Republic of Belarus Republic of Kazakhstan Russian Federation Brussels, 5 July 2012

2. Establishment of the Commission of the Customs Union / Devolution of some powers of national authorities to the CCU Establishment of the Eurasian Economic Community (EurAsEC) responsible for efficient promoting of the CU and the CES forming International organization: legal capacity Launching the Customs Union within EurAsEC: common tariff and non-tariff regulation Abolishment of customs clearance procedure of the goods in member- countries’ mutual trade Launching the mechanism of enrolment and allocation of import customs duties Entering into force of the Customs Code of the CU Final transfer of customs control to the external borders of the CU - forming the common customs territory of member- countries Launching of the Common Economic Space: entering into force of the CES agreements Establishment of the Eurasian Economic Commission - (legal successor of the Commission of the Customs Union) The Eurasian Economic Union History of the Eurasian Integration 2 Treaty on the CU and the CES Agreement on CU (RB and RF) Agreement on the CU (RB, RK,RF) 1995199920002007Jan.2010July 2010July 2011Jan.2012Feb.2012 2015

3. Eurasian Economic Union Common Economic Space Customs Union CES AgreementCES Agreement 2 … CES Agreement 16CES Agreement17  Unified macroeconomic, tax, monetary, trade and customs policies  Common economic regulation procedures  Common infrastructure  Coordinated tax, monetary and customs policies  Free movement of goods, services, capital and labor force …  Common customs territory  Common customs code  Common trade regime with third countries  Common customs tariff and non-tariff regulation measures  Abolition of customs clearance of goods in mutual trade and transition of customs control to external boards Key Phases of Eurasian Integration 3 StagesMain features Treaties Agreements CIS Free Trade Area  Non-application of customs duties and economic restrictions in mutual trade (except for trade remedies) - with exemptions Legal acts forming the legal base of the Customs Union in the framework of Eurasian Economic Community (EurAsEC)

4. Eurasian Economic Commission (EEC) 4 The EEC started its activity on the 1 st February 2012 on the basis of the Treaty on the Eurasian Economic Commission signed by the Presidents of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation on 18th of November 2011. The EEC is a single permanent regulatory body of the Customs Union (hereinafter the CU) and the Common Economic Space (hereinafter the CES). The EEC has replaced the Customs Union Commission (CUC). All the powers previewed by the international agreements of the CU have been transferred from the CUC to the EEC. The main goal of the EEC is “to provide for the operation and the evolution of the CU and the CES, and to carry out further economic integration initiatives within the framework of the CU and CES”

5. The CU Member States CU Member States: Republic of Belarus, Republic of Kazakhstan, Russian Federation Surface: 20 031 th. km² Population: 169 mln. Total GDP: 2,7 trn. $ US (4 % of world GDP) Total volume of external trade: 913 bln. $ US 5

6. The CU and the CES share in the global export in 2010 6

7. Growth Rate of Customs Union Economies in 2009-2011 7 2418 2561 2735 1156 1254 1314 Mlrd. $

8. Agreements Establishing the Common Economic Space  On Unified Principles and Rules of Technical Regulations of the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation  On Cooperation in Counteracting Illegal Labor Migration from Third Countries  On Legal Status of Migrant Workers and Members of Their Families  On Coordinated Macroeconomic Policy  On Coordinated Principles of Currency Policy  On Creation of Conditions at Financial Markets Necessary to Ensure Free Movement of Capital  On Unified Principles and Rules of Competition  On State (Municipal) Procurement 17 8

9. Agreements Establishing the Common Economic Space  On Unified Principles of Regulation in Protecting Intellectual Property Rights  On Unified Rules of State Support for Agriculture  On Unified Rules on Granting Industrial Subsidies  On Trade in Services and Investment in the CES Member States  On Unified Principles and Rules of Regulation of Natural Monopolies  On Access to Rail Transport Including Fundamental Principles of Tariff Policy  On Access to Natural Monopolies in the Power Industry Including Pricing and Tariff Policy  On Administration, Operation and Development of the Common Oil and Oil Products Markets  On Rules of Access to Services of Natural Monopolies in Gas Transportation by the Gas-transport Systems including Fundamental Principles of Tariff Policy 17 9

10. Bodies of the CU and the CES Supreme Eurasian Economic Council: - level of Heads of States - level of Heads of Government Eurasian Economic Commission (the Commission) Council of the Commission: 3 Members of the Council Board of the Commission: Chairperson + 8 Members of the Board EurAsEC Court Supreme Body of the CU and the CES The Common permanent regulatory body of the CU and the CES Dispute settlemnt body - defines the strategy and the objectives of further development of the CU and the CES - ensures functioning and development of the CU and the CES, carries out the initiatives on further economic integration Structural units of the Commission Missions of the Commission in member countries, in third countries and at the international organizations (established by the decision of the Supreme Eurasian Economic Commission) - ensure the interaction with national authorities Departments of the Commission Consulting bodies of the Commission 10

11. Eurasian Economic Commission 11 Council of the Commission three members of the Council (one Deputy Prime Minister representing each Member State)

12. Areas of Competence of the Eurasian Economic Commission under the Treaty on the EEC  tariff and non-tariff regulation  customs administration  technical regulation  sanitary, veterinary and phytosanitary measures  enrolment and allocation of import customs duties  establishment of trade regime with third countries  statistics of external and internal trade  macroeconomic policy  competition policy  industrial and agriculture subsidies  energy policy  natural monopolies  state and municipal purchases  internal trade in services and investment  transport and transportation  currency policy  protection of intellectual property and copyright  migration policy  financial markets (banking, insurance, foreign exchange market, stock market)  other areas 12 The EEC performs its activity within the powers provided by the Treaty on the EEC, by international agreements forming the legal base of the CU and the CES and by decisions of the Supreme Eurasian Economic Council

13. Board of the Commission Eurasian Economic Commission 1313 Chairman of the Board Viktor Khristenko Nurlan Aldabergenov Member of the Board- Minister in charge of competition Timur Suleimenov Member of the Board- Minister in charge of economics and financial policy Sergey Sidorsky Member of the Board- Minister in charge of industry and agriculture Andrey Slepnev Member of Board- Minister in charge of trade Valery Koreshkov Member of the Board- Minister in charge of technical regulation Vladimir Goshin Member of Board- Minister in charge of customs cooperation Danial Akhmetov Member of the Board-Minister in charge of energy and infrastructure Tatiana Valovaya Member of the Board- Minister in charge of development of integration and macroeconomics

14. Board of the Commission 1414 Members of the Board

15. Decision making process within the CU and the CES Departments of the Commission Consulting bodies of the Commission Council of the Commission Board of the Commission Supreme Eurasian Economic Council 1. The departments analyze the initiatives within their competency 3. The issue is submitted to the Board 4. The issue is submitted to the Council of the Commission 2. Member States analyze the issue and give their comments 5. The issue is submitted to the Supreme Eurasian Economic Council Decisions taken by the CU bodies become the integral part of the legal base of the CU and the CES The Board takes decision on issues within its competency The Council takes decision on issues within its competency The Supreme Council takes decision on the issue 15 National authorities

16. Regulatory Legal Framework of the Eurasian Economic Union 1616 Legal Base of the EurAsEC Legal Base of the Customs Union Legal Base of the Common Economic Space CODIFICATION of treaties and agreements achieved (no later than 2015) TREATY on the Eurasian Economic Union Single Codified Document Harmonization of existing legal norms Compliance with the WTO Agreement Elimination of inconsistencies and contradictions of legal norms Filling gaps and repealing obsolete norms Systematization of existing legal norms Principles of codification

17. The CU and the WTO membership The Russian Federation becomes a member of the WTO since July of 2012 Declaration on the Eurasian economic integration by the three Presidents (November 2011): «In their practical cooperation member countries of the CES are guided by norms and rules of the WTO and confirm the importance of the accession of all three states to the Organization» July 2012 2012 – 2013 … Treaty on the Functioning of the CU in the Framework of Multilateral Trade System of 19 May of 2011 enters into force 1717

18. The Treaty on the Functioning of the CU in the Framework of the Multilateral Trading System 1.1. Since the date of accession of any CU Party to the WTO, the provisions of the WTO Agreement, as set-out in its Protocol of Accession, including the commitments undertaken by that CU Party as part of the terms of its accession to the WTO, which related to matters that the Parties had authorised CU Bodies to regulate in the framework of the CU, as well as to the legal relationships regulated by the international treaties constituting the legal framework of the CU, became an integral part of the legal framework of the CU. 1.3. Upon the subsequent accession of another Party to the WTO, the commitments undertaken by that Party as part of the terms of its accession to the WTO, which relate to matters that the Parties have authorized Customs Union Bodies to regulate in the framework of the Customs Union, as well as the legal relationships, regulated by the international treaties, constituting the legal framework of the Customs Union, shall also become a part of the legal framework of the Customs Union. The Party acceding to the WTO shall notify other Parties and coordinate with them actions in respect of undertaking the commitments as a term of its accession, which require amendment to the legal framework of the Customs Union. Article 1. 1818

19. 2.1. CU Parties shall adopt measures to adjust the CU legal framework and decisions of CU Bodies to comply with the WTO Agreement as set-out in the Protocol of Accession of each Party. Until those measures were adopted... the WTO Agreement would always prevail over respective provisions of treaties concluded within the framework of the CU and of decisions adopted by its Bodies. 1.4. In case of divergence between the consolidated results of import tariff negotiations, achieved in the course of the accession to the WTO, the Parties concerned shall consult each other immediately and enter into negotiations with interested WTO Members expeditiously with a view to harmonize import tariffs rates. The Parties shall coordinate their positions and express the intention to follow the respective provisions of the WTO Agreement, that are applied in case of tariff harmonization by the customs unions. The rates of the Common Customs Tariff of the Customs Union shall not exceed the import tariff rates agreed as a result of harmonization unless otherwise is provided for in the WTO Agreement. The Treaty on the Functioning of the CU in the Framework of the Multilateral Trading System Article 2. 19

20. For information: The official site of the CU and the CES: www.tsouz.ru www.tsouz.ru Commission Headquarters: 3/5 building 1, Smolensky boulevard, Moscow, 119121, Russian Federation 20 For additional information: yacheistova@tsouz.ru or aristov@tsouz.ruyacheistova@tsouz.ruaristov@tsouz.ru