ArmInfo.The MPs of the Kazakh Senate adopted the law "On the ratification of the Agreement between the Government of the Republic of Kazakhstan and the Government of the Republic of Armenia on trade and economic cooperation in the field of supplies of petroleum products to the Republic of Armenia".
As Acting Minister of Energy of the Republic of Kazakhstan Aset Magauov noted, presenting the draft law at the plenary session of the Chamber, the supply of oil and oil products between members of the Eurasian Economic Union is regulated by separate bilateral agreements, in accordance with the Treaty on the Eurasian Economic Union dated May 29, 2014. On July 16, 2020, an Agreement on trade and economic cooperation in the field of supply of petroleum products to Armenia was signed in Nur-Sultan.
"The parties create the necessary conditions for the economic entities of the states of the parties to deliver supplies from Kazakhstan to Armenia with the involvement of authorized organizations," Aset Magauov said, Kazinform reports.
It was noted that, in accordance with the agreement, the parties approve the list of goods that are allowed to be delivered to Armenia. Further, the departments of the parties conclude an appropriate protocol. "Therefore, if any oil products are not included in the permitted list, then the export of goods will not be carried out," Aset Magauov explained.
In addition, in accordance with the Agreement, until December 1 of the current calendar year, the competent authorities of the parties annually draw up a balance of production, domestic consumption, supply, import and export of goods from the Republic of Kazakhstan and the Russian Federation to the Republic of Armenia, that is, indicative balances. "Considering that Russia is the main supplier of oil products to Armenia, possible supplies of Kazakh products will be determined on a residual basis. The Agreement also provides for a ban on supplies in excess of the volumes provided for by the indicative balances of the parties," Aset Magauov added.
According to Acting Minister, trade between the countries of the Eurasian Economic Union is carried out without payment of export customs duties, without customs control. This Agreement establishes a practically special regime for trade in petroleum products and contains control mechanisms for the export of petroleum products from Kazakhstan to Armenia. Such mechanisms will make it possible to sell surplus oil products on the more premium market of Armenia, which will positively affect the internal balance of oil products and increase the revenue of economic entities in Kazakhstan, as well as streamline the export of oil products from the Republic of Kazakhstan and protect the domestic market from uncontrolled flows of oil products to the EAEU countries. "It should be noted that the conditions of supplies will be determined by entrepreneurs independently by mutual agreement. These agreements will proceed only from the economy of these supplies," Aset Magauov said. The head of the Ministry of Energy noted that in practice, export transactions are concluded in foreign currency, usually in US dollars. Therefore, no risks are expected. The agreement also provides for a number of control mechanisms. Kazakhstan can unilaterally stop or limit duty-free supplies of oil products to Armenia in case of exceeding the volumes approved by indicative balances, force majeure, in order to ensure national security and protect the domestic market, as well as in case of violation by Armenia of its obligations to ban the export of Kazakhstani oil products to third countries and EAEU countries from their territory. "Therefore, there are no risks for the domestic market," Aset Magauov summed up. From 2020 to the present, the supply of Kazakh oil products to Armenia has not been carried out. Re-export from Armenia has not been recorded. The agreement stipulates that KTZh-GP monthly submits a report on the volumes of shipment of goods according to the nomenclatures of goods of the Unified Tariff and Statistical Nomenclature of Cargoes. In particular, the enterprises of the railways of Kazakhstan and Armenia interact through the information system in the field of railways. Also, the fiscal authorities of the states of the parties interact through the information system of the EAEU.
