On 1 January 2016 Title IV of the Association Agreement between the European Union and Ukraine (hereinafter – the “Agreement”) entered into force. It is aimed at liberalization of commerce between the EU and Ukraine and provides for a successive reduction or elimination of customs duties on import products originating from the EU, including components and equipment of power plants producing electricity from wind and solar energy.

The Agreement states that elimination or reduction of customs duties for certain goods by Ukraine as a rule will occur successively over the transitional period of a maximum of 10 years. Unless otherwise provided for in Annex I-A to the Agreement upon the expiration of the transitional period the customs duty shall constitute 0%.

The schedules of customs duties on import products for any of the codes of goods are specified in Annex I-A to the Agreement.

The successive reduction of customs duties by Ukraine shall be conducted in accordance with the respective schedules of reduction of customs duties of Ukraine, which were developed by the Ministry of Economic Development and Trade of Ukraine (hereinafter – “MEDT”)[1]. In particular, the successive reduction of customs duties was calculated according to the following formula[2]:

Customs duty for a year = Base rate[3]/previous year rate[4] – (Base rate/ (transitional period (in years)+1)).

Schedule of reduction of customs duties rates in Ukraine until the termination of the transitional period published by the MEDT is specified in Annex 1 hereto.

Additional customs duty

Importantly that on 1 January 2016 the Law of Ukraine “On measures to stimulate foreign trade activities” entered into force, which canceled the additional import tax of 5%, which referred to all components of solar and wind power plants, as well as equipment thereto during 2015. Please be reminded that such additional import duty was temporarily introduced early last year in order to stabilize the payment balance in Ukraine.

Should you have any questions or need an additional advice, please contact Yuriy Katser (ykatser@kpmg.ua) or Sergiy Popov (spopov@kpmg.ua) by phone +38 (044) 490 55 07 or via email.


Notice: Information stated herein has general nature and does not refer to any factual situation of any specific enterprise or individual. Despite we try to present accurate and timely information, we do not guarantee that this information is correct as on the date of its receipt or will be valid in future. Nobody should act or rely on such information without professional advice provided upon the study of the actual situation in detail.


[1] Please see the letter of Department of customs duties administration and customs and tariff regulation of the State Fiscal Service of Ukraine No. 21/99-99-25-02-02-18 dated 06 January 2016

[2] For the majority of goods the formula is a general formula, which applies for the calculation of customs duty rate.

[3] Exclusively for calculation of customs duty rate in 2016

[4] For calculation of customs duty rate in years succeeding 2016 (2017 and further on)