New "rules of the game" for exporters of agricultural products. What has changed?

Due to the difficult economic situation in the country, in particular, the difference between the Gothic exchange rate and the cashless exchange rate, a large number of agricultural producers decide to sell their products for cash to traders who offer a higher price, and then leave all foreign exchange earnings abroad.

In order to put an end to such abuses, as well as to support honest exporters, new rules for the export of agricultural products were developed, which were approved by the Cabinet of Ministers of Ukraine resolution "On the implementation of an experimental project on the verification of subjects of the agro-industrial complex under martial law" and "On making changes to the Cabinet of Ministers resolution of Ukraine dated December 27, 2022 No. 1466" dated October 31, 2023.

We will talk about the content of the innovations in this article.

 Which products are subject to licensing under the new rules?

• code UKTZED 1001 - wheat and a mixture of wheat and rye (meslin);
• code UKTZED 1002 - rye;
• code UKTZED 1003 - barley;
• code UKTZED 1004 – oats;
• code UKTZED 1005 – corn;
• code UKTZED 1201 - soybeans, crushed or not crushed;
• code UKTZED 1205 - Rapeseed or colza seeds, crushed or uncrushed;
• code UKTZED 1206 00 - sunflower seeds, crushed or uncrushed;
• code UKTZED 1507 - soybean oil and its fractions, refined or unrefined, but without changing their chemical composition;
• code UKTZED 1512 – sunflower, safflower or cottonseed oils and their fractions, refined or unrefined, but without changing their chemical composition;
• code UKTZED 1514 – rapeseed (from rapeseed or colza) or mustard oil and their fractions, refined or unrefined, but without changing their chemical composition;
• code UKTZED 1206 - cake and other solid waste and residues obtained during the extraction of vegetable or microbial fats and oils, with the exception of waste of heading 2304 or 2305, whether ground or not, whether or not granulated.

 Who has the right to export agricultural products?

 There are 2 groups of entities that have the right to export agricultural products. They are:

• entities that received an export license from the Ministry of Economy;

or

• verified exporters of agricultural products.

So, let's talk separately about each of these ways of exporting.

The first way: obtaining a license to export products

Until the introduction of new rules, a license was the only legal way to export agricultural products abroad.

At the same time, with the entry into force of the resolution of the Cabinet of Ministers of Ukraine "On Amendments to the Resolution of the Cabinet of Ministers of Ukraine dated December 27, 2022 No. 1466" dated October 31, 2023, corrections were also made to the procedure for obtaining such a license.

From now on, the procedure for obtaining a license to export agricultural products is as follows:

1. We serve license application to the Ministry of Economy of Ukraine. We add to the application:

– a letter of appeal regarding the issuance of a license;

– a copy of the foreign economic agreement (contract), all certified annexes and specifications to it;

– an expert opinion (original) with the definition of the country of origin and the product code of UKT ZED, which is issued by the Chamber of Commerce and Industry of Ukraine or the regional Chamber of Commerce and Industry;

The innovation is that the following must also be added to the application:

– valid VAT payer certificate;

– a certificate of opening a bank account by a non-resident (buyer of goods).

Such a certificate is issued by the bank of the country in which it is opened. At the same time, the certificate must be translated into Ukrainian, as well as certified by the seal of the enterprise or must have notarization.

2. We are waiting up to 10 working days from the moment the Ministry of Economy received our application and received a license to export agricultural products.

For the period of martial law, a license to export products is issued free of charge.

Special procedure for obtaining a license to export products

 In connection with the recent blockade of Ukrainian agricultural products by certain countries, Ukraine was forced to look for new ways of exporting agricultural products that would satisfy both the state itself and its European partners.

Therefore, the new rules provide for a special procedure for obtaining a license for the export of agricultural products to such countries as The Republic of Bulgaria, Romania, the Slovak Republic, Hungary and the Republic of Poland,

This procedure applies to the export of products under the following UKTZED codes: 1001 99 00 00, 1005 90 00 00, 1205 10 90 00, 1205 90 00, 1206 00 91 00, 1206 00 99 00.

The deadline for consideration of applications for obtaining a license to such countries and under such UKTZED codes is 30 days.

At the same time, the innovation about the need to add to the application a valid VAT payer's certificate and a certificate of opening a bank account by the buyer of goods for such licenses does not spread.

Please note that the issuance of licenses for the export of goods to such countries is possible only after The Ministry of Agriculture will agree on the need for such exports with the partners of the above-mentioned countries. This is done in 15-day period from the date of receipt of the license application from the Ministry of Economy.

If the Ministry of Agrarian Policy does not agree with the partners, it will happen grounds for refusal to issue a license.

The second way: verification of the exporter in the State Agrarian Register

 This method is a simplified procedure for the export of agricultural products and is intended for those entities that have already carried out export operations, in particular in the period from February 23, 2022 to October 27, 2023 inclusive.

Note! If the enterprise is a new entity in the field of export of agricultural products and has not carried out this activity before, then it cannot become a verified exporter. In this case, it is necessary to use the first method and issue a license for the export of agricultural products.

In order to pass the verification, it is necessary to answer the following conditions:

1. Be a registered VAT payer as of February 23, 2022 and on the date of submission of the request in the State Agrarian Register;
2. Have no tax debt and fines for violating the requirements of currency legislation;
3. In relation to the exporting enterprise, there must be no act of the tax authority regarding the failure to establish the location of the enterprise due to the impossibility of conducting an inspection regarding compliance with currency legislation;
4. To export goods from 02/23/2022 to 10/27/2023 and receive at least UAH 40 million in foreign currency revenue, for which currency control was completed.

 

In addition, a mandatory condition for verification is registration in the State Agrarian Register.

To be included in the list of verified exporters, the enterprise must go through the State Agrarian Register submit an application, which is formed electronically and upload a letter from the bank regarding a successful export operation in the period from 23.02.2022 to 27.10.2023.

All other information about VAT, the missing tax debt will be received automatically, in the order of information interaction between the DPS and the Ministry of Agrarian Policy.

 

The decision to include the enterprise in the list of verified exporters is formalized by order within two working days.

At the same time, if after verification the enterprise ceases to meet the above conditions, it will be excluded from the list of verified exporters. This can happen, for example, in the case of cancellation of the registration of the VAT payer.