Bosnia and Herzegovina, National Presentation, Changzhou, China

Training Report

Ognjen Alagić

BOSNIA AND HERZEGOVINA INDIRECT TAXATION AUTHORITY

Customs Sector

Changzhou, 2015/10/30

Flag

Situated in Southeastern Europe on the Balcan Peninsula Population 3.900.000, Area 51.197 km2

Capital and largest city – Sarajevo – population 440.000 GDP (PPP) 2014 - Total $ 19.122 billion, Per capita $ 4.939 Currency: Convertible mark (BAM) – 1 USD = 1.72 BAM

Bosnia and Herzegovina

Bordered by Croatia, Serbia and Montenegro 20 km of coastline on the Adriatic sea Combination of continental and mediterranean climate Mostly mountainous, the highest point is at 2.386 m Close to 50% is forested

Country is decentralized – comprises two autonomous entities and one district - The Federation of Bosnia and Herzegovina - Republika Srpska - Brcko District

5

Bosnia and Herzegovina Economy

Metals, wood products, and clothing are major export commodities by B&H to other countries.

Bosnia and Herzegovina's mineral resources - iron ore, lead, zinc, manganese, and bauxite

Main industries - steel production, vehicle assembly, textiles, tobacco products, wooden furniture and domestic appliances

Foreign direct investments in 2014 - €419 million Last 10 years top investor countries – Austria, Serbia, Croatia,

Slovenia, Russia, Germany, Switzerland and Netherlands Last 10 years investments by sector - manufactoring, banking,

telecommunication and trade

6

Bosnia and Herzegovina B&H Foreign Trade in Goods Statistics 2014 (total – China) Export amounted to 5.892 billion USD Import amounted to 10.991 billion USD The coverage of import by export was 53,6 % Export to China amounted to 9.195.000 USD Import from China amounted to 922.478.000 USD The coverage of import by export with China was 1 %

The participation of imported goods originally from China amounted to 11,92 % of total imports

Country Export Import Coverage IM/EX

Total USD 5,892 billion 10,991 billion 53,6 %

China USD 9,195 million 922,478 million 1 %

INDIRECT TAXATION AUTHORITYThe biggest state level institution in B&H


In the course of 2004 the former customs administrations of the entities and District Brcko were merged 1 January 2005 – Authority as an integral entity ITA is an autonomous administrative organization, through its Governing Board,to the Council of Ministers of B&H The Headquarters of ITA is in Banja Luka ITA has over 3.000 employees Revenue collection in 2014: 4,9 billion BAM (2,85 billion USD) The participation of indirect taxes in the total budget revenues amounts to 68%

9

INDIRECT TAXATION AUTHORITYRevenue Collection in 2014


ITA is responsible for enforcement of legal provisions and policy on indirect taxations Responsible for the collection of all indirect taxes in B&H

Value added tax

Customs duties

Excise duties Road taxes


Our prioprities are :

Accelerate the flow goods and people

Enhance the level of security of citizens

Develop cooperation with other institutions

Harmonize the procedures and align the legislation with the EU standards

Fight against illicit trafficking, customs and tax frauds

INDIRECT TAXATION AUTHORITYOrganizational structure

Five sectors

The Customs Sector The Tax Sector

The Business Services Sector The IT Sector

The Low Enforcement

Sector

INDIRECT TAXATION AUTHORITYOrganizational structure

The Tax Sector – second largest sector is responsible for implementation of VAT provisions

The Law Enforcement Sector – detect, investigate, document and process all types of smuggling, customs and tax frauds and other violations of provisions

The Business Services Sector – providing administrative and logistic support for the successful functioning of the ITA

The IT Sector – responsible for maintaining, planning and ICT development, serving as a basis for everyday functioning of all other ITA organizational units

The Customs SectorThe biggest organizational unit within the ITA

provides the customs service of B&H responsible for the collection of all customs duties, excise duties on the imported goods and road taxes responsible for collection of VAT on importation has responsibility for security of the citizens of B&H in cooperation with other institutions and inspection services customs officials and inspection services have responsibility for ensuring the quality and authenticity of goods continuos fight against trafficking in prohibited goods and substances responsible for prevention of illegal movement of goods and people

The Customs SectorOrganizational structure

Customs Sector ( Assistant

Director)

Tariff and Valuation ( Head

of Unit)Procedures ( Head of Unit)

Control ( Head of Unit)

Four Regional centers : Sarajevo, Banja Luka, Tuzla and Mostar

The Customs Sector Organizational structure

Import and export procedures at : - 40 road border crossings - 30 customs branch offices - 4 border crossings at the airports - 3 customs post offices - 8 railway border crossings - 4 free zones Sector has 1400 employees

17

Bosnia and HerzegovinaCurrent situation – The topic of the Seminar

1) National condition

2) Institutes for import and export commodity inspection

3) Laws and regulations on import and export commodity inspection, policies on IPP, standards for product inspection

4) Pre-shipment inspection system

5) Situation on fake and counterfeits (cases, brand, products)

18

1) National conditionInternational Trade Agreements

B&H has signed several agreements concerning trade facilitation and cooperation

Free trade agreement between the Republic of Turkey and B&H is entered into force on 01/07/2003

Central European Free Trade Agreement (CEFTA) is a trade agreement between non-EU countries in Southeast Europe (Serbia, Macedonia, Montenegro, Moldova, Albania and Kosovo UNMIK) which B&H assessed on 01/01/2007 . The agreement went into effect on 22/11/2007.

The Stabilization and Association Agreement (SAA) between B&H and the EU is entered into force on 01/07/2008

EFTA (European Free Trade Agreement - Iceland, Liechtenstein, Norway and Switzerland) signed a free trade agreement with B&H which is entered into force on 01/01/2015

19

1) National conditionConventions

Bosnia and Herzegovina has accessed to the Convention establishing a Customs Co-operation Council 04/07/2008 and became member of the World Customs Organization

Bosnia and Herzegovina has accessed to the Convention on Temporary Admission (Istanbul Convention) which entered into force 02/03/2010

B&H had become contracting party to the International Convention on the Harmonized Commodity Description and Coding System 04/08/2012 which entered into force 01/01/2014

Currently, B&H has observer status in the WTO and has expressed its readiness to implement all the WTO frameworks and standards

B&H is moving closer to EU, Road Map for the Bosnia and Herzegovina's EU Membership Application was handed over in June 2012

20

2) Institutes for import and export commodity inspection

Bosnia and Herzegovina has no joint administration for inspection affairs. All duties relating to the import and export commodity inspection are the responsibility of the individual Agencies, Institutes and Inspectorates. All institutions for their work correspond to the Council of Ministers of B&H.

Border Veterinary Inspection

Food Inspection

Market Inspection

Phytosanitary Inspection

Agency for Medicinal Products and Medical Devices

Institute for Standardization

Institute for Metrology

21

Border Veterinary InspectionLegal basis: Law on Veterinary Medicine and Law on Food as well as the

numerous Bylaws (regulations, orders, instructions, decisions, etc)

Conducts inspection and supervision of international transportation of animals, products of animal origin, animal feed and veterinary medicines

Monitors requirements for issuing international health certificates and participates in preparation and drafting of appropriate certificates

Controls veterinary-health conditions for export, import and transit of animals and products of animal origin, animal feed and veterinary medicines and implements relevant measures prescribed by the decision on inexistence of veterinary and health obstacles for import and transit

Border Veterinary Inspection conducts veterinary and health checks and controls over import, transit and export of consignments of animals and products of animal origin, objects and goods that potentially can transmit contagious diseases, hence endanger the lives and health of people and animals

Border Veterinary Inspection is also entitled and obliged to conduct veterinary control conditions related to transport of consignments, reload, temporary storage and disinfection of vehicles

22

Food Inspection

Legal basis: Law on Food and Law on Inspection as well as the numerous Bylaws (regulations, orders, instructions, decisions, etc)

Supervision in terms of compliance with the rules relating to the quality and safety of food and other areas of specific regulations

Control the import of food in terms of supporting documentation, the status of the consignment, the quality of the hygienic and safety of food

Taking samples for laboratory analysis

23

Market Inspection

Legal basis: Law on Inspection as well as the numerous Bylaws (regulations, orders, instructions, decisions, etc)

Security of a free exchange of goods and services and prevent distortions of the single market

Quality inspection of imported commodities regarding consumer protection and safety of products

Inspection of documentation that accompanies the goods, declarations, labeling, marking and packaging of products

24

Phytosanitary Inspection

Legal basis: Law on Inspection as well as the numerous Bylaws (regulations, orders, instructions, decisions, etc)

Plant health inspection in import, transit and export Quality inspection of plant protection products in import and

transit Quality control of fertilizers and plant breeding of land upon

import and transit

25

Agency for Medicinal Products and Medical Devices

Legal basis: Law on Medicinal Products and Medical Devices as well as the numerous Bylaws (regulations, orders, instructions,

decisions, etc)

Protecting and promoting public health care by ensuring a supply of quality, safe and efficient medicinal products and medical devices for use in human medicine, and for the purpose of establishing a functional, coordinate and uniform system for regulation of medicinal products and medical devices

establishing and supervising a unified market for medicinal products and medical devices and ensuring their availability on the whole territory of Bosnia and Herzegovina

Harmonizing the regulations with the international standards The Agency is responsible for issuing licences for the import of

medicinal products and medical devices in Bosnia and Herzegovina as well as inspection after importation

26

Institute for Standardization

Legal basis: Law on Standardization as well as the numerous Bylaws (regulations, orders, instructions, decisions, etc)

Prepares and publishes standards of B&H, represents and acts on behalf of B&H in international, European and other organizations for standardization

In the field of conformity assessment, the Institute participates in establishing and maintaining a system of certification and homologation in accordance with the European model

provides assistance and information from standardization to all interested entities

Full member of: ISO and ETSI Associate member of: IEC, CEN and CENELEC

27

Institute for Metrology Legal basis: Law on Metrology, Measurement Units Law, Law on

the Inspection of Articles of Precious Metals as well as the numerous Bylaws (regulations, orders, instructions, decisions, etc)

Performs verification benchmarks and issue licenses for importation

Performs testing and verification of articles of precious metals, keep the register of approved manufacturers and importers characters articles of precious metals

Establishes a etalon base and provides international traceability of measurements

Carries out measurements and tests Provides help and information in the field of metrology to all

interested entities

28

3) Intellectual property protection in B&H The law on establishment of the Institute for intellectual property of

Bosnia and Herzegovina was adopted in September 2004 The Institute runs the administrative procedure for the acquisition,

maintenance, traffic and termination of industrial property rights (patent, patent with short duration, trademarks, service mark, industrial design, geographical designation) on the territory of Bosnia and Herzegovina

The Institute runs the procedure for the international registration of industrial property rights on the basis of international conventions whose member is Bosnia and Herzegovina

The Institute prepares foundations for Bosnia and Herzegovina's accession to bilateral and multilateral agreements, conventions and treaties in the field of intellectual property

The Institute performs with the aim of achieving international co-operation with the institutions of other countries, as well as with international organizations in the field of intellectual property

The Institute runs a register of representative for the protection of the industrial property rights

29

3) Intellectual property protection in B&HLegal Background

Patent Law Trademark Law Law in Industrial Designs Law on Protection of Indications of Geographical Origin Law on Protection of Topographies of Integrated Circuits Copyright and Related Rights Law Law on the Collective Management of Copyright and Related Rights The regulations on the procedure for the recognition of the trade mark The regulations on the procedure for the recognition of patent The regulations on the procedure for the recognition of industrial designs The regulations on the procedure for recognition of the origin of the product,

the origin and geographical names tags Decision on implementation of customs measures for the protection of

intellectual property Order of the jurisdiction of customs offices for clearance of certain goods

originating from Asian and African countries Other numerous Bylaws (regulations, orders, instructions, decisions, etc)

30

4) Pre-shipment Inspection System in B&H

Pre-shipment inspections (PSI) are not required by B&H Government

PSI are carried out only on a voluntary basis on the buyer or on the seller request to make sure that the goods being shipped are in line with the contractual specifications

31

4) Pre-shipment Inspection System in B&HExample

Global Halal market is the fastest growing market whose value in 2009 was 456.4 billion euros.

World Halal market meets the needs of 1.8 billion Muslim customers Halal product is a product that meets all the regulations on food safety, hygiene and

sanitation, whose composition does not contain a single ingredient that is forbidden for Muslims to use, which applies the requirements of Halal production standards, and which does not use prohibited raw materials and other resources. As such, Halal product has no substitute and it is protected against competition

Halal standard is a document that clearly defines procedures of Halal certification (what is allowed and what is forbidden to Muslims, how implementation of the provisions of Halal standards is certified and verified, how the Halal slaughter of animals is performed, how Halal products are marked and which aditives are Halal, and which are not)

Halal standard is registered with the Institute for Standardization of B&H as a national standard called Halal foods - requirements and measures, BAS 1049:2007. Halal standard is compatible with other international standards that regulate the area of quality production management (ISO, HACCP and others)

The Agency for Halal Quality Certification is a specialized institution of the Islamic Community in B&H dealing with Halal certification of products, manufacturers and services, and monitoring of requirements of Halal standard BAS 1049:2007 in companies that have implemented the above requirements.

32


2014/05/29 CO Gradiska Container from China 10.480 pieces of sunglasses by

brands Gucci, Chanel, Ray-Ban, Prada, and Burberry

3.600 pieces of various brands of watches by Dolce Gabbana, Armani and Guess

1.500 wallets by Hugo Boss 6.624 Paco Rabanne perfumes,

Chanel and Hugo Boss 295.200 pieces of Durex condoms 5 bags of Nike labels Temporarily confiscated Estimated value 630.000 EUR Legal proceedings before the Court

is not ended

33


2014/11/29 CO Gradiska Container from China 24.144 pieces of sunglasses by

brands Gucci, Chanel, Prada, and Burberry, Cartier, Police, Giorgio Armani, Dior, Ray Ban, Louis Vuitton, Hermes, Tom Ford, Mon Blanc and Cavalli

The counterfeit sunglasses are found together with other goods

Bad packaging sunglasses caused suspicion of fakery

Confiscated Estimated value 241.440 EUR The importer was fined – 3.500 EUR

34


2014/03/12 CO Sarajevo Container from China 25.507 pieces of various brands

of watches by brands Puma, Adidas, Nike, Emporio Armani, Cartier, Dolce&Gabbana, Breitling and Hello Kitty

The counterfeit watches are found together with other goods

Bad packaging and quality caused suspicion of fakery

Confiscated Estimated value 360.000 EUR The importer was fined – 4.500

EUR

35


2015/05/17 CO Sarajevo Container from China 300 pieces of famous brand

“Kosmodisk Classic” Spine Massager

The counterfeit commodity is found together with other goods

The goods were declared as a toy at a price of 2.00 USD per piece

Bad packaging and quality caused suspicion of fakery

Confiscated Estimated value 15.000 EUR Legal proceedings before the

Court is not ended

36


2015/08/08 CO Tuzla Container from China 960 Paco Rabanne perfumes 960 Armani Code perfumes The goods were declared as

deodorants at a price of 0.71 USD per piece

Temporarily confiscated Estimated value 38.400 EUR Legal proceedings before the

Court is not ended

37

Edin Dzeko

The most famous Bosnian footballer who plays as a forward for Italian club Roma. Also he played for Manchester City and Wolfsburg. He led the national team at the World Cup 2014 in Brazil.

38

Bosnia and HerzegovinaTouristic Destination – Jahorina mountain

39

Bosnia and HerzegovinaTouristic Destinations

40

Banja LukaCity of Ladies

The ratio of men and women

1 : 1,18World Ratio

1,01 : 1

THANK YOU FOR YOUR ATTENTION !!!

Bosnia and Herzegovina, National Presentation, Changzhou, China

Economy & Finance

Transcript of Bosnia and Herzegovina, National Presentation, Changzhou, China