EaEU: movement of four freedoms

By Vestnik Kavkaza

The idea of starting talks on a free trade zone between the Eurasian Economic Union and the EU is still relevant, according to Sergei Lavrov, the Foreign Minister of Russia. Moscow is calling on its European partners to start a project of integration between the EaEU and the EU for several years. Lavrov says that the first step could be talks on agreements on the free trade zone. The Minister of Economy and Financial Policy of the Eurasian Economic Commission, Timur Suleymanov, noted that “the Eurasian Economic Union is a subject of international law, an international organization of regional integration which is regulated by the European Economic Union Agreement. The agreement was signed on May 29 th 2014 in Astana. In October the Republic of Armenia joined it. It will continue joining it till May 2015. Our plans are that Kyrgyzstan will join the union in May and become a full member this year.”

Speaking about the changes which are brought about by the EaEU Agreement, Suleimanov says that the Eurasian Economic Union is based on the norms of the Customs Union, but it develops them, providing movement of four freedoms – freedom of movement of goods, services, capital and labor force.

On July 1st 2011 customs borders were registered (all kinds of the state control, except for frontier control, were shifted to the external outline) and free movement of all kinds of goods began, except for some withdrawals. Later, free movement of services and investments was started.“Speaking about free movement of services, the agreement requires an opportunity for providing services without registration of a legal entity, if one has a legal registration in one of countries, one can provide services either remotely or through a local office. It is not necessary to register a legal entity with all the ensuing bureaucratic consequences within the agreement in agreed sectors. Moreover, licenses and other approval documents will be mutually recognized. The state regulation of various kinds of activities is provided through access to the job. Licenses which are issued in one state will be recognized in other countries of the Union,” Suleimanov explained.

As for movement of the labor force, it is being provided within the united economic space. “We have preserved it at the EaEU stage. Demands for licenses on attraction of foreign labor forces are absent at the national level, as well as measures for protection of the internal labor market for citizens of the Union. The Union agreement requires mutual recognition of diplomas for all kinds of jobs, except for pharmaceutical services, medicine, juridical services and teaching. These kinds of activities can differ most significantly. Speaking about all other kinds of jobs and education, direct and automatic recognition of diplomas which are issued on the territory of the Union is organized,” the minister says.

Moreover, tax problems were also solved. Citizens who contract work in a neighboring country will be taxed, according to a residential tax rate. Moreover, the agreement requires the norms of social and healthcare services of the national regime. According to Suleimanov, “access to social benefits, social infrastructure of all countries of the EaEU will be provided non-discriminatively to all citizens. Services which are provided for a citizen of one country will be available for a citizen of another country if he is working in the country timely.”

Regarding the establishment of the united financial market, the minister noted: “It cannot be established at once. However, we set its outlines – we described clearly the united financial market, what should be done to establish it; we laid institutional foundations of regulation of the united financial market within the Union. By 2025 a united regulator of financial markets will be established on the basis of the harmonized legislation which regulates financial markets. It will be situation in Almaty.”