Ukraine may introduce preliminary export deposits for export of agricultural goods

Ukraine may introduce a regime of preliminary export deposits for the export of certain agricultural products. The relevant draft law was registered in the Verkhovna Rada of Ukraine by MP Marian Zablotskyi.

The draft law introduces a regime of preliminary export deposits. This should help regulate Ukraine’s balance of payments when exporting goods classified under UKTZED codes 1001, 1002, 1003, 1004, 1005, 1201, 1205, 1206, 1507, 1512, 1514, 2306.

The draft law provides that:

• export of wheat, barley, corn, soybeans, rapeseed, sunflower seeds, oil, cake and meal may be carried out only after depositing at least 10% of the customs value of the consignment by replenishing the exporter’s preliminary export deposit from its own current account with the bank;
• the replenishment of the preliminary export deposit may not be made if the total amount of all preliminary export deposits of the exporter is more than USD 35 million (and this amount does not exceed 10% of the customs value of the consignment);
  after the return of foreign currency earnings to Ukraine, the deposited funds will be returned to the exporter in full, and in case of partial return – in proportion to the returned amount;
• if the exporter violates the terms for returning foreign currency earnings, the amount of replenishment of the previous export deposit is transferred to the state budget;
• the release of the above goods into the customs regime of export and the passage outside the customs territory of Ukraine is carried out by the customs authorities on the basis of a certificate confirming the replenishment of the preliminary export deposit or a certificate of the consolidated amount of preliminary export deposits.

“The draft law was developed to ensure the return of foreign currency earnings to the state and to regulate the balance of payments of Ukraine when exporting certain agricultural products from Ukraine by establishing a regime of preliminary export deposits, as well as to prevent the legalization (laundering) of proceeds from crime through the export of such products,” the explanatory note says.

As a reminder, on October 31, the Cabinet of Ministers issued Resolution No. 1132, which is aimed at preparing for the introduction of new grain export rules. The resolution currently regulates only the formation of the list of verified agricultural entities. In other words, it actually stipulates which companies will be subject to the new rules for exports and VAT refunds in the future.

Tags: soybean, oilseeds, wheat, sunseed, rapeseed, Ukraine, sunflower oil, corn, export, grain, barley