MARCH 2009 INFORMAL CONSULTATIONS ON THE

UNCLAS GENEVA 000293


STATE FOR EUR/RUS, EB/TDC
PASS USTR FOR RHODE, KLEIN, BURKHEAD, OWEN, CHATTIN,
FIELD
USEU FOR CHASE AND MULANEY
MOSCOW FOR BEYRLE AND FISHMAN
ASTANA FOR HOAGLAND AND WOCKLEY
LONDON FOR TOKOLA
KYIV FOR YARNELL

E.O. 12958: N/A
TAGS: ETRD ECON WTRO USTR RS
SUBJECT: MARCH 2009 INFORMAL CONSULTATIONS ON THE
ACCESSION OF RUSSIA TO THE WORLD TRADE ORGANIZATION

Meetings on Russian WTO Accession


1. Summary and next steps: On March 27, the Chairman of the WTO
Working Party (WP) on the Accession of the Russian Federation
(Russia) to the WTO convened an informal consultative meeting to
discuss status of work and next steps in the Russian WTO accession
process. WTO members also held plurilateral meetings on Sanitary
and Phytosanitary Measures (SPS) and on the tariff rate quotas
(TRQs) applied to Russian beef, pork and poultry imports. The U.S.
delegation met bilaterally with the Russian delegation on SPS and
Agriculture issues. These were procedural meetings and, kept the
process moving, but at a slow pace. Comments on the SPS text
reviewed plurilaterally are due by April 27. The Chairman indicated
he would consult with delegations to find a date for a next
Chairman's meeting to review the substance of Russia's submissions
(current planning is directed to the week of May 25) and to find a
date for an Agricultural Plurilateral to review Russia's revised
tables on Agricultural Support, a compendium of data on such
support, and depending on the outcome of his consultations, the
revised draft WP text on agriculture. Russia indicated it expects
to meet again with interested delegations on the TRQ issue within
about a month and will provide proposals at that time. . End
Summary and next steps.

Chairman's Consultation


2. After the Chairman's introductory review, Russia's chief
negotiator, Maxim Medvedkov, was invited to give a report on
Russia's legislative progress. He provided a short update on the
status of amendments to the following: part IV of the Civil Code
(intellectual property rights-IPR),the Law on Medicines (protection
of undisclosed data),the Customs Code (to grant ex officio
authority related to IPR enforcement),the law on activity
licensing, the law on Technical Regulation (status of international
agreements),and the adoption of a Government Resolution on imports
of goods with encryption. This list omitted additional legislation
needed to implement WTO provisions related, inter alia, to TBT,
Customs Valuation, and SPS. The Chairman repeated his request that
Russia produce a status chart on legislative work towards
implementation of WTO provisions. (Note: An applicant country
routinely submits a chart and legislative action plan during the
late stages of accession negotiations. End note). Russia objected
to this request, claiming it was duplicative and too much work. The
U.S. del supported the Chairman's request and subsequently the
Chairman commissioned the Secretariat to initiate work on the chart
and action plan for adoption of legislation. U.S. and other WTO
members will need to continue to insist that Russia follow standard
practice and adopt legislation prior to approval of the accession
package to ensure Russia will meet its commitments to comply with
WTO obligations from the date of accession.


3. Medvedkov reported that all of Russia's negotiations on market
access for tariffs and services were now completed (with three
specific areas excepted, as noted below) and that his delegation was
assisting the Secretariat in pulling together the draft consolidated
tariff schedule from Russia's many bilateral agreements. He stated
that the work should be completed within six weeks. The three
outstanding areas where work continued with delegations and for
which there would be no entry in the consolidated schedule were
sugar; high quality beef (HQB definition); and meat and poultry TRQs
that were expiring at the end of 2009 and would have to be
renegotiated. Georgia immediately objected to Russia's statement on
having completed its market access negotiations, stating that it had
not yet signed a bilateral agreement with Russia. Turkey
intervened twice during the meeting to note that its goods (fruits
and vegetables) were being subject to 100 percent inspection upon
entering Russia , inconsistent with WTO norms (Customs Valuation,
PSI and SPS ). While Turkey and Russia have a bilateral agreement
on these issues, Turkey maintains Russia was not observing its
terms.


4. Secretariat work on compiling the consolidated goods schedule (a
daunting task involving over 60 separate agreements, errors in the
electronic files, and multiple nomenclatures to harmonize into
HS2007) has taken some time. It had been reported that a new
Secretariat team has taken over, and the Russians and others had
expressed concern that this might further delay the work.
Recognizing that this could undermine efforts to move the
negotiations forward and after additional consultations, the
Secretariat reportedly has returned the previous staff to the task.
The Russian del. also indicated that they were working with
interested delegations to resolve the remaining issues in the
services schedule, and should have a resolution "in a few days."
(Comment: It is good news that work on the goods schedule is back
on track. But while none of the issues with the goods and services
schedules cannot be resolved, it is unlikely that the problems that
have delayed circulation of these draft consolidated schedules to
date will come to closure "in a few days." End Comment).


5. The Chairman's informal consultations did not engage in a
substantive review of the texts contained in JOB(09)14). Medvedkov
introduced the changes and characterized the "majority" of the
changes that Russia had made in the text of JOB(08)36/Rev.1 since
the discussions in November as "technical issues and
clarifications." The United States, Saudi Arabia, and Norway noted
however that Russia had not been comprehensive in addressing issues
that they had raised, and not all of their concerns were dealt with
in the revised material in JOB(09)14. All indicated that they would
provide additional comments, and the Chairman encouraged other
delegations to do the same. (Note: In later bilateral discussions,
the Saudi Geneva representative confirmed that they were still
working with Russia on those comments, but that they would table
additional text unless their issues were resolved within a couple of
months. He also noted that their issue of most concern, state owned
and controlled firms, was not under discussion with Russia because
it was one of the three "missing" sections of the report and there
was no text to review. End Note) Medvedkov also reported that
discussions after the meetings in November had produced additional
compromise language in some paragraphs and these texts were also in
JOB(09)14. (Comment: The results of drafting efforts of the U.S.,
Russia and EU in December. End comment). Finally, there was a
revised text on agriculture, one of the three missing sections.
Russia had expected to review this text, along with new data on
agricultural supports, in a plurilateral meeting in these days, but
had canceled these plans when a new Agricultural Minister was
announced. When consultations with the new Minister were completed,
new dates would be found. The US suggested that the draft WP report
text on agriculture could be reviewed with other WP texts, rather
than plurilaterally. Russia and the Chair agreed, but Canada
indicated that it needed to consult with capital on this and the EU
indicated that it would support either approach. The Chairman
indicated that he would consult further.

Plurilateral Meetings on TRQs and SPS


6. WP members also participated in plurilateral meetings on two key
issues: (1) Russia's plans for establishing bindings for meat
products currently covered by bilaterally negotiated TRQs; and (2)
the revised WP text on SPS measures. The meeting on TRQs was
attended by the United States, EU, Argentina, Brazil, Colombia,
Paraguay, Korea, Japan, Thailand, Vietnam, China, New Zealand, and
Australia. Noting there appeared to be two broad approaches,
continuation of TRQs or tariff-only treatment, the Russian
representative walked through several sections of the November 5,
2008, document on Section 1-B including TRQs: product coverage,
TRQ allocation, and administration methods. Russia indicated at
this time it was prepared to continue TRQs on all three products,
taking into account the existing exception on high quality beef.
Medvedkov emphasized that new bindings for the tariff lines covered
would be established through bilateral negotiations, effective
January 1, 2010. He also reviewed the proposal Russia had tabled in
the previous meeting on this issue in November 2008 laying out
TRQ-based or tariff-only options for the replaced bindings. He
noted that the ultimate decision on whether to adopt TRQs or a


tariff only approach rested with Russia.


7. Only Argentina and Brazil explicitly spoke in favor of a
tariff-only solution as the only acceptable outcome. Most others
seemed willing to negotiate TRQs or supported a global TRQ.
Currently the United States and the EU are allocated 70-80 percent
of the in-quota quantities for poultry, pork, and beef. The U.S.
del noted that proposals circulated in November are not consistent
with our WTO bilateral market access agreement. In addition, to
evaluate Russia's proposal to move material to the draft WP report,
we will need to see specific texts, and these will need to be
commitments. We noted our preference for TRQs and specific country
allocations. The U.S. also noted, that on the issue of a definition
of high quality beef (HQB),the "menu approach" proposed by Russia,
allowing for multiple definitions of high-quality beef, may not meet
the scope of product coverage granted in the concession in bilateral
market access agreement. Russia drew few conclusions from the
meeting but noted that it would call another in a month and would
present specific proposals at that time.


8. The SPS Plurilateral meeting reviewed the revised SPS WP report
text in light of some new materials developed by Russia and the EU
and the US in trilateral discussions in December. In a paragraph by
paragraph review, there were few comments on the material. Four
delegations (US, EU, Canada, and Australia) pressed Russia to
confirm that it would have fully implemented a WTO-consistent SPS
regime prior to accession. The Russian del had circulated a brief
summary paper outlining a proposed process to harmonize its SPS
measures with international standards. Delegations asked questions
on the procedure described in the summary. Canada and others asked
about the timing for initiating this process. Dr. Rozhdestvenskiy
noted that Russia has an ongoing program of harmonization pursuant
to Order 159 and that the timing of the new measures was uncertain.
While the new measure would be in place as of accession, the process
of harmonization would continue after accession. In response to a
question from the U.S. del., Rozhdestvenskiy informed Members that
the Administrative Regulation on Issuing Permits to Import and
Export Animals and Products of Animal Origin, Feed and Feed
Additives, and Products Subject to Quarantine (9 January 2008) was
being revised and invited comments from dels. He expects that the
amendments will be completed in 4-6 weeks. The United States will
be providing suggested revisions to the regulation.

Bilateral Meetings


9. In a bilateral meeting on SPS held before the plurilateral and
Chairman's informal meeting, the Russian del explained that it had
circulated the summary paper. U.S. del questioned the process that
would be used for Russia to harmonize its measures and the timing
for adoption of the Government Resolution that would establish the
process. Russia did not provide a clear answer on when the
Government Resolution would be adopted, implying that it could be
done as part of Russia's approval of the terms of accession, i.e.,
after completion of the negotiations. The U.S. del. also had a
brief bilateral meeting to discuss next steps on the draft
agriculture text for the WP report. The Russian side indicated that
it had received a few technical comments on its draft text and on
the compendium of domestic agricultural support programs and would
submit a slightly revised version shortly.


ALLGEIER