In general, the average level of Russian duties, equal to 11-12%, is in compliance to the other WTO member states’ levels. However, Russia imposes increased duties in certain sectors of Italian interest (furniture, footwear, clothing, ceramics, and drinks) and also implies duties regarding the export of products such as unprocessed leather and non ferrous minerals, which lead to increased costs for the Italian enterprises of iron and tanning industry.
The situation is improved thanks to the conclusion of the bilateral Protocol with the European Commission, which determines the accession in WTO status of Russia. Moscow accepted to reduce the duties, including the light reduce of the high duties regarding the sectors of strategic importance for Italian industry (auto-industry, aviation, navigation, steel).
The average taxation of the industrial products will be equal to 7,6%, a value sensibly lower than the 8,9% that implies for China, by the accession in WTO. The average taxation of the agricultural products will be reduced to 13,5% in comparison to the 15% resulted by the negotiations with the Chinese.
It is underlined that certain tariff reduce agreed, concern products imported from Italy, such as furniture (from 20% to12,5% within a five years period), wine (from 20% to 12,5% within 3 years), olive oil (from 15% to 5%) and footwear.
In Russia remain various non tariff barriers, with numerous technical obstacles for the trading of industrial and agricultural products. The Russian system of certification and standards, customs regulations, phytosanitary controls, registration procedures and license issuance is complex, expensive, opaque and does not comply to the international regulations, as far as these matters are concerned. In addition, the legislative framework of certifications is opaque and deficient. The certification by private Institutions is rarely acceptable, while exists also the spread use of necessary certificates by third parties and the licenses have a limited duration. The exporters are obliged to confront difficult controls and expensive processes for the registration and permissions acquisition, with the consequence of often delays.
The state Authorities (State Institute Gostandard and individual technical ministries) usually do not accept the community certifications (for example ISO 9000), and demand “ad hoc” quality and compatibility certifications imposing complex registration procedures.
Moreover, foreign enterprises that have invested in Russia often meet difficulties in requiring by the local authorities the necessary administrative permissions (in the context of health, environment, building constructions as well as water and electric power supply services).
In a general level, it is underlined that one of the main problems is the deficient cooperation among bureaucracy procedures concerning the application of the foreseen simplifications of the modified laws of the administrative system.
Another non tariff barrier is the chronic problem of the customs services. Although, the new Customs Code, which provides the simplification and reduce of discretion in procedures (for example defining deadlines for customs clearance), is set into force, the situation remains problematic.
c) Violations against copyright law
The violations of the copyright law are still often: within the scope of the negotiations for the accession in WTO. This problem was set off mainly by the USA, which have been negatively affected by the counterfeighting in industrial scale of audiovisual means and softwear (CD Rom, DVD and video).
Moreover, is still deficient the protection offered by the local authorities as far as the consolidation of trade marks and patents, the origin naming and the geographical indications is concerned. Italy has been damaged in the Russian market by the counterfeighting-with China’s responsibility- of capital goods of low technology and consumer goods of low quality.
d) Concerns regarding foreign investments in the country
One of the most crucial problems which have to confront the Italian investors is the incomplete functions of the State of fairness, because of the absence of a specific legislative framework and the weakness of the judicial power. Despite the uncontested legislative improvements introduced over the last years, the foreign enterprises often find that the protection from the judicial Authorities is deficient. The cases of controversies are numerous and of a wide range due to the lack of contracts during the expropriation procedure by the Russian partner’s side. The judicial power appears sometimes inclined to external influence, while it is proved that the judicial authorities do not always recognize the sentences of the International Arbitration Courts. A certain concern is also manifested for the controversies regarding mixed companies, where one of the counterparties seems to be the local Authorities, which at this moment turn to hostile actions, including the real use of the bankruptcy procedure.
Another mechanism, which is sometimes used is the system of the so said “empty box”, based on which the Russian partner in a mixed company and / or the Russian debtor company transfer their shares to other companies. In this case, the sentences of the local Tribunals have no real effect, because the creditor company cannot turn against the counterparty, which remains without shares. In addition, Russian owners submitted under the control of a mixed company, often have no knowledge of their contractual obligations concerning the foreign partner.
Russian Government accepted the suggestion of Italy for the constitution of a “Tutor”, an authority to which Italian enterprises could address in order to prevent, and when necessary, solve the trade and financial disputes, avoiding the interference of Tribunals. In some recent cases the intervention of the “Tutor” proved efficient and gave a solution to the plaintiff, however, it is also confirmed that it is an organ used only in case the controversy involves public institutions.