Zero rate on customs duty enters into force

Pristina, 7 June 2004 – The Regulation 2004/13 on zero customs duties on capital and intermediary goods enters into force today. This is another very important step for Kosovo’s economic development.

This regulation amends the Annexes to Regulation 1999/3 on the Establishment of Customs and Other Related Services in Kosovo. Up to now, Regulation 1999/3 imposed ten percent customs duties on goods of all types destined for Kosovo. There were only few exceptions.

In order to further improve conditions for investment and production in Kosovo, regulation 2004/13 introduces zero percent customs duties on a range of capital and intermediary goods. This new Regulation has been introduced quickly as Regulation 2004/1 Customs Code for Kosovo provided the necessary enabling mechanisms. Importing these production inputs without customs duties is expected to have a considerably positive effect on local production in Kosovo.

The Customs Code takes into account the need to administer the exemption system properly and to exclude misuse of the system, by use of an Admin Instruction issued by the Director General of UNMIK Customs.

The present regulation is the result of excellent joint work by the Government and Pillar IV. It originated with a proposal made in the Economic and Fiscal Council by the Ministry of Finance and Economy. The proposal was drafted and finalised by a joint Trade Policy Working Group including the Office of the Prime Minister, the Ministry of Finance and Economy, the Ministry of Agriculture, Forestry and Rural development, Pillar IV, UNMIK Customs and CAFAO.

This is another important step in favouring Kosovo’s economic development, and is part of a series of measures destined to encourage economic activity in Kosovo as well as Kosovo’s trade with the region and beyond. It needs to be seen in the context of other important EU-Pillar supported measures to facilitate investment and production.

UNMIK signed a Free Trade Agreement in June last year and concluded a reciprocal Investment Promotion and Protection Agreement in February 2004, both with Albania.

UNMIK Customs have also introduced a new computer system, known as TIMS, which incorporates new procedures which are required by the new Customs Code. This also provides a basis for improving the accuracy of Customs declarations and will be of help to both Importers and Customs Service.

Kosovo’s new Customs Code, effective from the first of March this year, introduced a number of provisions to enhance economic development and facilitate the activity of importers. The new Code has made the implementation of this new Regulation a simple process. UNMIK customs has established a new unit (25 officers) to assist the successful implementation of these measures. It will offer advice and guidance to interested companies. Customs will be pleased to provide further details to interested companies.