NTB Study Croatia
Note: On 30 November 2000, Croatia became a member of
WTO.
The EU maintained Autonomous trade preferences after the denunciation
in November 1991 of the 1980 Cooperation Agreement with SFRY.
These measures comprise: (1) exemptions from customs duties and
the abolition of QRs for industrial products, except for certain
products (especially textile products) subject to tariff ceilings;
(2) special concessions for various agricultural products, including
wine. These concessions apply for a yearly basis.
Formal negotiations
on the stabilisation and association agreement were launched at
the Zagreb Summit on November 24 2000.
Croatia
concluded FTA with Slovenia and Macedonia. An assymetric FTA with
BiH is due to be signed soon (will grant duty free to all imports
originating in B&H whilst B&H will gradually reduce tax
on Croatian imports during the next three years). A FTA is under
advanced negotiation with Hungary and Croatia expects to start
soon negotiations with Romania and Bulgaria for FTA.
Import/export prohibitions
None
Import/export
quotas
None.
Import/export
tariff quotas
Croatia applies tariff rate quotas on a MFN basis for the following
agricultural products: meat, wheat, sugar, and chocolate as it
is reflected in its Schedule of concessions and commitments on
goods negotiated during Croatia accession process to the WTO.
Tariff quotas are also applied for agricultural and food products
in the framework of FTAs with Slovenia and Macedonia.
Administration and allocation of the tariff rate quotas are based
on a number of criteria that are always combined and publicly
known (1. traditional traders, with at least 10% reserved for
new entrants, 2. needs of the domestic processing industry, 3.
regional criteria). A group comprising ministries and private
sector representatives is responsible for allocating tariff quotas
in line with these criteria.
Comments
It was noted with regard to the FTA with Slovenia that the quotas
are normally not filled on the Slovenian side. Some doubts were
expressed during our visit whether the Slovenian side did really
its utmost to ensure that this situation changes.
Other charges
None.
Import/export
licenses
According to lists provided in the context of WTO accession, Croatia
requires import licenses for a sizeable number of goods,
ranging from chapters 26.12 (uranium) of the HS nomenclature to
93.07 (swords). Most of them fall into the category of goods usually
covered by Articles XX and XXI of the GATT 1994 (national security,
human, animal and plant health, protection of the environment,
control on trade in works of art and precious metal). Applications
only have to be submitted to one licensing authority even if a
given product falls under the competence of several ministries.
Relevant authorities issue licenses on an automatic basis for
a limited period of time (usually six months); they can be extended
upon request. Licenses are not transferable. A reasonably modest
fee is charged for each import license.
Licenses are also applied for imports of iron tubes and bars from
non-WTO members.
Export licenses are still required for a number of tariff
positions (96 according to documents submitted to WTO) for statistical
and monitoring purposes. Products covered range from radioactive
material, acids, and explosive material to certain metals, weapons
and arts and antiques.
The Decision on goods subject to the import and export licence
regime has been amended on several occasions over the past three
years (1996-1999) with a view to minimising the volume of goods
subjects to licence and to ensure that licences are issued on
an automatic basis.
Comments
From the users’ side, no specific problems were reported
concerning the granting of licenses.
According to the Croatian authorities, the main non-WTO member
exporters of iron bars and tubes to Croatia are Macedonia, Bosnia
and Herzegovina, Federal Republic of Yugoslavia and Ukraine.
There appears to be some confusion about the use of the term license.
Many of the products contained in the lists provided to WTO, especially
those for which the State Bureau of Standards and Measurement,
the Ministry of Health or Ministry of Agriculture and Forestry
are licensing authorities, need to undergo a verification procedure,
the purpose of which is to demonstrate that the imported goods
correspond to the Croatian laws for the product in question. Once
this is established, the product can be imported and does not
need an additional license. Furthermore, the range of products
subject to such verification indicated in these lists is often
too wide because the entire product range of a four or six-digit
HS number is listed, even if only some of the products need to
undergo the mandatory procedures. While it was possible for the
authors of this study to pinpoint these inconsistencies during
talks with representatives of various authorities, they can create
confusion and additional work to investors and economic operators
that are unnecessary.
Recommendations
-
Croatia should review the reasons for import licences for
iron tubes and bars originating in Macedonia, BiH, FRY with
a view to removing them as a contribution to regional cooperation.
-
The different ministries and authorities in the Croatian administration
should agree on the use of the term “license” and
review the relevant documents with a view to bringing them
in line with the agreed understanding.
Customs
valuation
The WTO agreement on customs valuation is applied since 1 January
2000.
Comments
No specific problems were reported during our visit concerning
the application of customs valuation rules. It is, however, not
excluded that in the minds of some of our interlocutors customs
valuation was part of the problems raised concerning customs clearances
(see below).
Rules of
origin
The Customs Law sets out the rules of origin in non-preferential
trade while referring to the text of the preferential agreements
for origin rules required in that context.
Comments
Rules of origin for non-preferential trade appear to be in line
with international practice.
Registration
requirement
Natural and legal persons wishing to engage in business activities,
including trade, are required to establish a company and register
it with a Commercial Court.
Any company whishing to engage in trade of sensitive goods for
reasons of health, safety or security (arms, explosives, medicines,
drugs, narcotics and toxins) has to submit to the Commercial Court
an activity license issued by the competent authority before incorporation
of the company.
Functioning
of customs
Since many efforts by international institutions (SECI, EU, World
Bank, etc.) have been directed to identify and remove problems
connected with customs clearances, this study has not concentrated
on this issue. This is not to say, however, that such problems
cannot be very serious NTBs and, indeed, such issues were raised
regularly by interlocutors during our visit to Zagreb. In a survey
by the Croatian Chamber of Economy in autumn 1998, long waiting
at the Croatian border was the second-most cited problem encountered
in international trade by Croatian firms, followed by long waiting
at borders of SECI countries and at the border of other European
countries. A further item on the list referred to insufficient
working time of sanitary, veterinary and phytosanitary services
at the Croatian border. It is therefore not surprising that proposals
to improve the situation at the border are among the most important
ones in the list of the Chamber. Also other sources confirmed that infrastructure,
antiquated equipment, procedures, short opening hours and insufficiently
trained personnel constitute a problem at the Croatian customs
and difficulties caused by smuggling, bribery, etc. were reported
for exchanges at the border with Bosnia and Herzegovina. Great
hopes are therefore set in assistance programmes like the TTFSE
project by the World Bank which are
expected to improve the situation. In that context it is also
noteworthy that a new draft for a Law on the Customs Administration
has recently entered the parliamentary adoption procedure and
should be adopted in the beginning of 2001.
Recommendations
-
The EU has supported the control of customs at Croatia’s
Eastern borders as part of the CAM-ES programme. It could
be considered to what degree the experiences acquired by the
EU in these provinces as well as in its customs assistance
programmes in Albania and BiH could be made available to Croatia
as a whole, either as a part of the TTFSE project or complementing
it but in any case in a coordinated fashion.
-
What appears to be missing is the cooperation between neighbouring
countries. It is thus recommended that Croatia seek agreements
with its neighbours on simplifying and harmonising customs
procedures and documents, as well as on granting each other
administrative assistance in enforcing the respective customs
legislation. To the degree possible, such agreements should
follow the same model for all neighbours and possibly even
for all countries in the region.
TBT and
SPS measures; quality controls
Since the legal framework on TBT and SPS issues appears to have
been completed, Croatia took the commitment to apply all corresponding
obligations under the WTO Agreements from the date of accession
without recourse to any transition period.
According to the Standardisation Act, which entered into force
on 10 July 1996, the application of Croatian standards is no longer
mandatory since 1 January 1997. The new Croatian standards have
to be based on international (ISO, IEC) or regional/European standards.
A list of products that are subject to mandatory certification
according to the Standardization Act is attached at Annex I.
Croatia has provided for the possibility of recognizing test reports
issued abroad and laid down the rules in a Regulation and a set
of instructions.
According to the new law on State Inspectorate passed on 30 June
1999, the quality controls aim at ensuring consumer protection
whereas the public policy objective of SPS controls is to address
risks to public health. Quality controls on imported items as
part of customs clearance was abolished. The control is performed
on designated imported and domestic products at the wholesale
and retail levels. The currently valid list of products subject
to quality control contains 20 groups of products, ranging from
meat and meat products, dairy products over coffee, teas, sugar
and honey to alcoholic beverages, fuel and fuel oils. All regulations
regarding quality control are under review. It is intended to
put them into compliance with European regulations. The lists
of goods subject to mandatory SPS controls (sanitary and phytosanitary
measures) are attached at Annex II.
Comments and recommendations
-
While the review of quality control measures is under way,
several laws still in force are very old and need to be urgently
updated. It is recommended that this process be undertaken
without delay. To the degree necessary and not yet done, the
SPS and quality control requirements for the same product
category should be streamlined.
-
The limited working time of officials in charge of making
sanitary, veterinary and phytosanitary controls at the Croatian
borders was mentioned as a problem for international trade
in the survey conducted by the Croatian Chamber of Economy
(see above). It is recommended that Croatia remedy this situation
in the context of the overall upgrading of customs clearance
services.
Other problems
-
The judicial system has been reported as being overburdened,
slow and politically influenced. Businesses thus complain
that disputes linger for years and decisions are blocked.
Increasingly, they resort to out-of-court settlements in order
to avoid these consequences.
Comments
This issue evidently falls outside the scope of our study but
is mentioned here for information and completeness’ sake
because it is a problem that is likely to effect imports and exports
as well. Possible solutions might entail creation of a commercial
court or more frequent resorting to arbitration – a practice
widely used in other countries.
Problems
with neighbouring countries
As problems were mentioned:
-
Import ban during the past two years from Macedonia on crude
oil and derivatives (safeguard measure under FTA).
-
SPS certificate required by BiH for certain products such
as wine in bottle
-
The filling of tariff quotas by Slovenia (see above)
Main references
Trade Development
Institute of Ireland Limited, Study on Trade Policy in Southeast
Europe , September 1999
INFORMEST
and Centro Studi Nord Est, Problems, Perceptions and Perspectives
of Foreign Direct Investments in the SECI countries transition
economies. The point of view of Italian entrepreneurs , 1999.
EastWest Institute,
Task Force on Economic Strategy for South Eastern Europe
, Final Report, June 2000.
WTO documents
prepared during the process of Croatia accession.
Information received during our visit to Croatia from 6 to 8 November
2000.
Annex I
LIST OF PRODUCTS THAT ARE SUBJECT TO MANDATORY CERTIFICATION
(According to the Act on Standardization (Official Gazette
no. 55/96))
EQUIPMENT AND PROTECTIVE SYSTEMS IN POTENTIALLY EXPLOSIVE
ATMOSPHERES (EX-EQUIPMENT)
Regulation on the essential requirements for equipment, security
systems and components intended for explosive gas, vapour and
dust atmospheres.
ELECTRICAL ENGINEERING
Order on the mandatory certification of electronic household appliances
and electronic devices for similar use.
Order on the mandatory certification of electric household appliances.
Order on the mandatory certification of hand-held electric motor
operated tools.
Order on the mandatory certification of isolating transformers
and safety isolating transformers.
Order on the mandatory certification of insulated electric power
conductors and cables.
Order on the mandatory certification of switches for household
appliances.
Order on the mandatory certification of
Edison screw lamp holders.
ELECTROMAGNETIC COMPATIBILITY
Regulation on the mandatory certification of products causing
radio-frequency disturbances.
BOMB SHELTERS, MULTIFUNCTIONAL FACILITIES, VENTILATION AND
AIR-CONDITIONING DEVICES
Order on the mandatory certification of steel devices for the
closure of doorways in bomb shelters and multifunctional facilities.
Order on the mandatory certification of ventilation systems of
bomb shelters and multifunctional facilities.
Order on the mandatory certification of sealing rubber bands for
doors, shutters, and movable shelter partitions with hermetic
door leaves closure.
Order on the mandatory certification of safety valves for bomb
shelters and multifunctional facilities.
Order on the mandatory certification of reinforced concrete devices
for the closure of doorways in bomb shelters and multifunctional
facilities.
LIFTS
Regulation on the mandatory certification of electrically operated
lifts for the vertical transport of passengers and freight.
Regulation on the mandatory certification of electrically operated
lifts for the vertical transport of freight with a lift cab inaccessible
to people.
Regulation on the mandatory certification of lift clutching devices.
Regulation on the mandatory certification of the lift limit switches.
Regulation on the mandatory certification of lift shaft door locks.
Regulation on the mandatory certification of buffers used with
lifts.
GAS APPLIANCES AND ACCESSORIES
Order on the mandatory certification of mobile gas furnaces for
heating without chimney attachment.
Regulation on the mandatory certification of gas kitchen stoves,
cookers, ovens and grills.
Regulation on the mandatory certification of gas appliances for
large-scale kitchens and for camping.
Order on the mandatory certification of gas pressure steel containers
with valve for propane-butane gas.
Order on the mandatory certification of pressure regulators for
propane-butane liquid gas.
CONSTRUCTION MATERIALS AND ELEMENTS
Order on the mandatory certification of fractionated stone aggregate
for concrete and asphalt.
Order on the mandatory certification of cement.
Regulation on the mandatory certification of façade bricks
and clay blocks.
Regulation on the mandatory certification of clay roofing tiles.
Order on the mandatory certification of admixtures for concrete.
Order on the mandatory certification of hydro insulating materials
impregnated with bitumen and bitumen bands.
Order on the mandatory certification of pre-manufactured elements
of auto claved aerated concrete.
Order on the mandatory certification of concrete tubes for sewage
longer than 1 meter.
FIRE RESISTANCE
Regulation on the mandatory certification to fire resistance of
standardized elements of buildings structures.
Guidance on the test procedure and classification of fire resistance
of fire dampers in ventilation and air-conditioning shafts.
Regulation on the mandatory certification of file cabinets to
fire resistance.
METAL PRODUCTS
Order on the mandatory certification of roller bearings.
Order on the mandatory certification of ropes for mine hoisting
plants.
Order on the mandatory certification of screws, nuts and studs
for joints of supporting steel structures.
Regulation on the mandatory certification of brake linings of
automotive vehicles and trailers.
Order on the mandatory certification of steel ropes for general
use.
Order on the mandatory certification of chains and parts of chains.
PERSONAL PROTECTIVE EQUIPMENT, PROTECTIVE DEVICES AND OTHER
EQUIPMENT
Order on the mandatory certification of safety helmets for industrial
use.
Order on the mandatory certification of portable and conveyable
fire extinguishers.
Order on the mandatory certification of fire-hats.
Regulation on the mandatory certification of safety belts.
Regulation on the mandatory certification of climbing spurs for
wooden poles.
Order on the mandatory certification of respiratory protective
devices.
WOOD TECHNOLOGY
Order on the mandatory certification of fibre building boards
for general use and in the construction industry.
MEAT AND OTHER EDIBLE ANIMAL PRODUCE
Regulation on the categorization and classification of pork halves.
FURNITURE
Regulation on the mandatory testing of furniture and parts of
furniture.
BEVERAGES – SPRING AND TABLE WATER, INCLUDING NATURAL
MINERAL WATER
Regulation on the basic requirements of natural mineral water,
spring and table water.
Regulation regarding the design and use of the certification mark
(Official Gazette no. 88/98, 165/98).
List of authorised certification bodies is published in DZNM –
Publication. All data are available on web site:
www.dznm.hr
up to now in Croatian. English version will be available in one-month
time.
Annex II
Products subject to sanitary measures
|
Tariff N° |
Product description |
Measure |
|
01 |
Live animals; animal products |
Veterinary regulations
Health regulations |
|
02 |
Meat and edible meat offal |
Veterinary regulations
Health regulations |
|
03 |
Fish, crustaceans, molluscs and other aquatic invertebrates
|
Veterinary regulations
Health regulations |
|
04 |
Dairy products, honey, eggs |
Veterinary regulations
Health regulations |
|
05 |
Products of animal origin |
Veterinary regulations
Health regulations |
|
15 |
Animal fats, prepared edible fats, animal waxes
|
Veterinary regulations
Health regulations |
|
16 |
Preparations of meat, fish, crustaceans, molluscs
Or other aquatic invertebrates |
Veterinary regulations
Health regulations |
|
21 |
Miscellaneous edible preparations |
Veterinary regulations
Health regulations |
|
23 |
Chemical Residues |
Veterinary regulations
Health regulations |
|
|
Animal feed |
Veterinary regulations
Livestock regulations |
Annex II
Products subject to phytosanitary measures
|
Tariff Number |
Plants and Plant Product Description |
|
06.01 – 06.04 |
Living trees and other plants, bulbs, roots and similar,
cut flowers
and ornamental leaves |
|
07.01 – 07.14 |
Edible vegetables and certain root and tubers fresh or dried
(excluded frozen and conserved) |
|
08.01 – 08.14 |
Edible fruits and nuts, peel of citrus fruit or melons fresh
or dried
(excluded frozen, conserved, boiled) |
|
09.01 – 09.10 |
Coffee unroasted, tea, mate and spices – unpacked
and unprocessed |
|
10.01 – 10.08 |
Cereals |
|
11.01 – 11.06 |
Products of milling industry – excluded malt, starch,
inulin and
gluten |
|
12.01 – 12.14 |
Oil seeds and fruits, miscellaneous grains, seeds and fruits,
Industrial and medicinal plants, straw and fodder
|
|
14.01 – 14.04 |
Vegetable planting materials, vegetable products not elsewhere
Specified or included |
|
18.01 – 18.02 |
Cocoa beans, whole or broken, unroasted |
|
23.00 – 23.09 |
Residues and waste from the food industries, prepared animal
Fodder |
|
24.01 |
Unmanufactured tobacco, tobacco refuse |
|
27.03 |
Peat (including peat litter) |
|
31.01 |
Vegetable fertilizers, fertilizer produced by the mixing
of animal
And vegetable products |
|
38.08 |
Insecticides, rodenticides, fungicides, herbicides, anti-sprouting
Products and plant-growth regulators, disinfectants and
similar
Products, put up in forms or packing for retail sale
|
|
44.01 – 44.18 |
Wood and wood products – excluded wood chemically or
heat treated |
|
45.01 |
Natural cork, raw or simply prepared, waste cork, crushed,
Granulated or ground cork |
|
50.01 |
Silk – worm cocoons suitable for reeling |
|
50.03 |
Silk waste (including cocoons unsuitable for reeling, yarn
waste
And garneted stock) |
|
52.01 – 52.02 |
Cotton, not carded or combed, cotton waste |
|
53.01 |
Flax raw or processed but not spun, tow and waste (including
Yarn waste and garneted stock) |
|
53.02 |
True hemp, raw or processed but not spun, taw and waste
of true
hemp |
|
53.03 |
Jute and other bast, raw or processed but not spun, tow
and waste of these fibres |
|
53.04 |
Sisal and other textile fibres of the genus Agave raw or
processed but not spun |
|
