Some importers have experienced the Russian customs authorities’ refusal to clear their goods meant for domestic consumption because of a lack of labels or because such labels were in foreign languages. In a recent case (Case No. А21-1074/2015 – see here in Russian), the court at the cassation level ruled that the customs authorities were right in refusing to clear goods, whose labelling was not only untimely done, but was also done in violation of the technical regulatory requirements.
When importing goods into the territory of the Eurasian Economic Union (the “EEU”), importers must comply with the EEU’s technical regulatory requirements relating, in particular, to the labelling of goods. Therefore, timely and appropriate labelling of goods ensures swift customs clearance for distribution in the EEU.
The law enforcement practice on the labelling of goods is constantly developing. Therefore some of the latest changes could create some unexpected problems for importers that are unaware of the latest trends.
Background and position of the customs authorities
In the past, the Russian customs authorities used to clear goods meant for domestic consumption that had documents confirming their compliance with the EEU’s technical regulatory requirements without labels or with labels in foreign languages. The customs authorities allowed subsequent labelling of such goods. This means it was possible to label these goods after their importation into the EEU, but this had to be done before putting them on the EEU market.
In early 2015, the customs authorities began to require goods be labelled in Russian language at the time of their clearance for domestic consumption. On 18 February 2015, the Federal Customs Service of Russia (the “FCS”) issued a letter (viewable here in Russian) in which it noted the need to mark goods with a single label that contains general information about the goods in Russian languagebefore their clearance for the EEU market. The only exceptions are situations where the customs procedures on imported goods exempt such goods from labelling obligations.
Thus, according to the FCS’ position, the absence of labels on goods or use of labels that do not comply with the EEU’s technical regulations constitutes a sufficient ground for the customs authorities to refuse to clear such goods for domestic consumption.
Some importers, whose goods were not cleared by the customs authorities for domestic consumption because of lack of labels or because such labels are in foreign languages, have turned to the commercial courts in Russia to protect their interests.
The current court practice on the goods labelling issue is not consistent. That said, in most cases, the courts rule in favour of the customs authorities. So, in this type of dispute, the courts often indicate that a lack of a label on the good means the failure of an importer to comply with the technical regulations. This fact is a sufficient ground for refusing to clear such goods for domestic consumption within the EEU, even if the importer had submitted all the necessary documents confirming the goods’ compliance with the EEU’s technical regulations.
Some examples of this approach by the courts can be seen in Resolution No. F05-3140/2015 of the Commercial Court of the Moscow District dated 5 April 2015 in Case No. A40-88263/14 (here in Russian), as well as in Resolution 15AP-7274/2015 of the Fifteenth Commercial Appeal Court dated 26 May 2015 in Case No. A53-29318/2014 (here in Russian).
It is now clear that the law enforcement practice on the issue of labelling goods at the time of their clearance for domestic consumption within the EEU is unfavourable to the importers.
Therefore, when importing goods that have no labels or which are labelled in foreign languages,importers should take advantage of the customs warehouse procedure and label the goods as part of this customs procedure. This will help them avoid the risk of having their goods blocked at the borders by the Russian customs authorities. Once all the labelling requirements are met, importers will be free to clear their goods for domestic consumption within the EEU.