FOREIGN TRADE LAW

[BorisVM]

FOREIGN TRADE LAW

(Published in the

Official Gazette of the Republic of Macedonia No. 31/93-716)

(Unofficial Translation)

I. GENERAL PROVISIONS

Article 1

This Law regulates the foreign trade, which includes the foreign trade turnover and performing economic activities abroad.

Article 2

Foreign trade and economic activities abroad may be performed by legal entities performing economic activities (hereinafter: enterprises).

Banking and other financial activities abroad may be performed by banks, in accordance with this Law and regulating establishment and working of banks. Insurance and reinsurance activities abroad may be performed by insurance and reinsurance agencies, in compliance with laws regulating establishment and working of those organizations.

Article 3

The right to foreign trade is acquired on the date of court registration, if not otherwise prescribed by this Law.

Enterprises may perform only those foreign trade activities for which it is registered in court.

Article 4

Foreign trade in the fields of arms and military equipment is also subjected to this Law, if not regulated otherwise by another law.

II. CONDITIONS FOR FOREIGN TRADE ACTIVITIES

Article 5

Foreign trade activities are performed on basis of contracts concluded in compliance with laws and regulations in the Republic of Macedonia and international agreements and conventions.

Article 6

Enterprises can be engaged in providing services in the foreign trade to foreign persons in the Republic of Macedonia within frames of its registered activities, and abroad installation services of the equipment it exports, even without a court registration.

The provision of Para 1 of this Article also refers to entrepreneurs who have not registered a company, shop or agricultural co-operative for that purpose.

Article 7

Goods can be permanently or temporarily imported only if fulfilling prescribed conditions for sale, i.e., use of the goods in the Republic of Macedonia; services can also be permanently or temporarily imported only in accordance with the positive regulations and international conventions and agreements.

Goods on which a health, a veterinary, a fitopathological or quality control is required, cannot be imported either permanently or temporarily, if they fail to meet the prescribed conditions.

Goods cannot be temporarily or permanently imported in the Republic of Macedonia, if their distribution is prohibited in the countries of their origin, except upon special license, issued by the administrative organ in charge of foreign economic relations.

By exception of provisions in Para 1 and 2 of this Article, goods can be temporarily imported, for the purposes of refinement, research or processing, if it does not endanger the lives of people and the environment.

For purposes of protection and improving of the environment, the Government of the Republic of Macedonia may ban the imports and transit of certain products in the territory of the Republic of Macedonia, or prescribe conditions under which such products shall be imported or exported.

Article 8

The administrative agency in charge of foreign economic relations may authorize state agencies, agencies of the units of local self-government, citizens' associations and other legal entities, to perform single foreign trade operations for their own use; it may also authorize social organizations and other legal entities which are not registered for foreign trade activities to perform single foreign trade operations for their own use, i.e., to perform foreign trade operations connected with their own activities.

Article 9

Imports, i.e., exports are regarded as completed when the merchandise has passed customs and has been paid customs tariffs for, i.e., when the service is provided. The date of payment of customs tariffs is regarded as a date of the imports, i.e., exports.

Even by exception of Para 1 of this Article, the administrative agency in charge of foreign economic relations may issue a permission for export, i.e., export customs clearance without having the goods cross the border line, if such an agreement is concluded with the foreign entity and if it helps lower transportation expenses. During export, i.e., import customs clearance of these goods, provisions regulating the exports and imports of goods which have crossed the border line are implemented.

The official managing the administrative agency in charge of foreign economic relations determines the date which is to be regarded as a date of provided services.

III. TYPES OF IMPORTS AND EXPORTS

Article 10

Imports and exports are liberal.

For purposes of protection of the domestic production and planned development, the imports and exports of goods may be regulated by prescribing quotas (contingents).

Certain goods may be imported and/or exported on basis of a license, in cases of implementation of international agreements, regulation of imports and exports of arms and military equipment, and imports and exports of historic artistic works and certain precious metals.

For the purpose of balancing the exchange of goods and services with certain countries or regions, as well as for collection of receivable from abroad and selflimitation in exporting merchandise the exports of which is limited by foreign imports barriers, the imports and exports of certain goods may be regionally directed by issuing imports and/or exports approvals.

The quotas of Para 2, licenses of Para 3 and approvals of Para 4 of this Article are all issued by the administrative agency in charge of foreign economic relations.

Article 11

Imports of spare parts for maintenance of imported equipment, the equipment itself, spare parts for it, and durable consumer goods are free for entrepreneurs and legal entities.

Carrying arms, ammunition, explosives and reproduction materials for explosives into the country and receiving the same from abroad is prohibited for natural persons.

Imports and transit of dangerous waste materials through the territory of the Republic of Macedonia is prohibited.

Imports of equipment, raw materials and intermediate products for own production, invested by a foreign person as a share or enlargement of the share in a domestic enterprise, are free and performed in accordance with the enterprise’s establishment act, i.e., investments in the enterprise.

Article 12

The Government of the Republic of Macedonia classifies the goods into certain types of imports and exports and determines goods the exports and imports of which shall be regionally directed.

Article 13

Upon a suggestion by the administrative agency in charge of foreign economic relations, as well as upon opinion of competent organs of economy, agriculture and wood industry, to be submitted by October 31 of the current year, the Government of the Republic of Macedonia prescribes imports and exports contingents in terms of value and quantity, regional direction of imports and dynamics of the imports and exports for the following year.

The administrative agency in charge of foreign economic relations distributes the contingents of Para 1 of this Article among users. In cases of exception, contingents may be also given to producers.

During each distribution of contingents, at least 10% are to be set aside for additional distribution, for the following: new production the needs of which could not be calculated prior to the distribution, and purchase of fair exponents at international fairs held in the Republic of Macedonia.

Article 14

Prescribed quotas determine the quantity of exports, i.e., imports of certain goods in terms of value or quantity, usually for one year. If goods are being exported and/or imported in a period longer than one year, contingents are prescribed for the period of duration of the credit, i.e., of the exports and/or imports of the goods.

Article 15

The administrative agency in charge of foreign economic relations may approve of contingents exceeding the determined contingents in Article 13 of this Law to certain users stated in Article 13 (2) of this Law, in cases of: imports of goods to replace other goods damaged by vis major; imports of goods on basis of a credit approved of by international financial organizations at an international auction; imports of raw materials and intermediate products for export-oriented production, along with an obligation to export goods of at least 30% greater in value than the imports within the time limit set in the approval; and exports of goods, if it does not influence the supply of the domestic market or in case of increase of prices of certain goods above the average.

IV. SPECIAL TYPES OF FOREIGN TRADE

I. Long-Term Production Cooperation

Article 16

Enterprises and other legal entities cannot, within the frames of their production activities, conclude a contract for long-term production cooperation with a foreign legal entity or physical person, without an approval by the administrative organ in charge of foreign economic relations.

The approval of Para 1 of this Article may be issued if the contract is in a written form and effective for at least three years, if the value of the exports - subject of the contract are at least equal to the value of the imports, and if the exchange includes raw materials, intermediate products, spare parts and ready-made products of the same kind, for the purpose of specializing the production.

Payment and collection resulting from activities of contracts of Para 1 of this Article will be carried out upon compliance with the law regulating currency transactions.

On basis of contracts and upon an approval stated in Para 1 of this Article, goods are exported and/or imported freely.

Article 17

Contracts stated in Article 16 of this Law and changes made in it are submitted to the administrative organ in charge of foreign economic relations, to be approved of within thirty days of the date of its signing, i.e. The changes and additions, in original and a verified translation, along with a summary specification of goods to be exported and imported in each year of the contract’s duration.

The administrative organ in charge of foreign economic relations is obliged to decide on the application for approval of Article 16 of this Law within thirty days from its submission. If no decision is made within that time, the contract will be regarded as approved of.

2. Compensation Matters

Article 18

On basis of an approval of the administrative organ in charge of foreign economic relations, enterprises may enter into contracts on exports and imports of goods and services charged by imports of goods and services of at least the same value (compensation transactions).

The administrative organ in charge of foreign economic relations approves of compensation transactions if the import to countries with payment difficulties is not possible to collect in foreign currency, if the import of goods and services is to cover for export of energy and other raw material, if the import or rented foreign equipment is in the function of exports, and if the imported goods are of significance for the domestic market or the distribution of which is difficult.

Imports and exports of goods of Para 1 of this Article are performed in compliance with prescribed types of imports and exports.

The Government of the Republic of Macedonia prescribes closer conditions, way and time limits in which contracts on compensation transactions of Para 1 and 2 of this Article may be entered into.

3. Mediation in Foreign Trade

Article 19

Enterprises may purchase goods abroad for the purpose of selling them abroad, or re-export of the purchased and imported, i.e., temporarily imported goods.

In case of purchase of goods from foreign countries, imports of the goods and exports of the same quantity of goods classified under the same customs tariff, imports and exports are free.

Payment and collection for activities of Para 1 of this Article may also be through exports of goods under conditions stated in Article 18 of this Law. Activities of Para 1 of this Article are approved of by the administrative agency in charge of foreign economic relations, and all financial transactions concerning the activities are approved of by the National Bank of Macedonia.

The administrative agency in charge of foreign economic relations approves the activities of Para 1 of this Article, provided that they are in accord with concluded international trade agreements or that they do not influence the regular exports of goods from the Republic of Macedonia, or in the following cases: if the activities create new employment; activate and/or provide better use of free production capacities or fulfillment of obligations undertaken by international agreements; provide greater inflow of hard currency sold and bought at the currency market; lowering of due and uncollected receivable of the Republic of Macedonia from certain countries and help balance the exchange with countries with which agreements on balanced exchange of goods and services are signed.

The Government of the Republic of Macedonia prescribes closer conditions and way of approving, registering, and control of activities of Para 1 of this Article.

4. Local Border Trade

Article 20

Local border trade is performed in border areas, in compliance with this Law, concluded international agreements and regulations based on this Law.

A border area, as regarded by this law, is an area agreed upon by an international agreement.

Activities including imports and exports of goods and services in the local border trade may be performed by an enterprise with court registration for such activities, if not determined otherwise by an international agreement.

Imports and exports of goods within frames of local border trade are performed in accordance with prescribed types of exports and imports.

V. SERVICES IN FOREIGN TRADE

Article 21

Services in foreign trade, as regarded by this Law, in particular are: investments in foreign countries and transferring the right to investment projects to foreign persons in the Republic of Macedonia, services including international transport of goods and passengers, all services accompanying the international transport (international forwarding, storage, airport services, agency transport services, etc.), hotel and tourist services, mediation and representation in turnover with goods and services, PTT and other telecommunication services, services including the control of quantity and quality of imported and exported goods, scientific, research and development services, giving and using economic and scientific information and experience, attestation and other services in accordance with the accepted classification and nomenclature.

Article 22

Enterprises engaged in investments and construction activities abroad may, without importing into the Republic of Macedonia, purchase abroad equipment needed for the investment operations, spare parts and materials built in the equipment, i.e., object constructed abroad.

Enterprises engaged in investment and construction activities abroad may import a part of the equipment and materials to be built in the equipment necessary for performing construction activities abroad.

During purchase of the equipment and materials of Para 1 and 2 of this Article, regulations applying to imports of such equipment and materials are not in effect.

Article 23

Enterprises engaged in investment and construction activities abroad may freely import in the Republic of Macedonia equipment and spare parts, purchased and used abroad for carrying out works stated in the agreement for construction projects abroad.

During imports of equipment and spare parts of Para 1 and 2 of this Article, the enterprise is obliged, besides proof for their being purchased abroad, to also submit a written statement by an authorized person, proving the equipment has been used abroad for the said purpose.

Should the enterprise decide to keep or write off the equipment abroad the equipment it has used in a foreign country for construction activities, it is obliged to submit a final statement of accounts on it, to the Public Revenue Office, along with a decision by the managing body.

Article 24

The right to perform construction activities, i.e., certain activities connected with construction in the Republic of Macedonia (in the further text: investment operations in the Republic of Macedonia) may be transferred to a foreign contractor, on basis of a previous competitive bidding auction or gathering offers from the smallest number of bidders, in accordance with provisions regulating the public bidding auctions and gathering offers.

Article 25

Conditions for transferring the right to investment in the Republic of Macedonia to a foreign contractor are set by the investor, along with the amount, i.e., the type of bail required for participation in the bidding auction.

Activities of Para 1 of this Article may be transferred to a foreign contractor, if

1) the foreign contractor presents a bank guarantee for compensation of possible losses of the investor, caused by not fulfillment of the agreement by the contractor;

2) the foreign contractor accepts the implementation of Macedonian standards, technical regulations and quality standards, i.e., implementation of international standards, technical regulations and quality standards of foreign countries, in the cases when for certain products, production or services there are no Macedonian regulations, standards, technical regulations or quality standards. In such cases, a certificate is required by the organization in charge of standardization matters, which is obliged to issue such a certificate within 30 days after the application; and

3) the foreign contractor engages domestic performers, whereas the manager and experts may be foreign citizens.

Article 26

The agreement for investment abroad, i.e., the agreement for investment in the Republic of Macedonia is concluded in a written form and registered by the administrative agency in charge of foreign economic relations.

The agreement of Para 1 of this Article and its changes and additions are reported of within 30 days after the date of signature, i.e., the date of changes and additions.

Article 27

Enterprises performing international forwarding may organize forwarding and delivery of goods in the international traffic in its own name and on behalf and by order of clients; may conclude agreements on transport, loading, reloading, unloading, assortment, packing and storing and insuring goods; may organize transportation by various transportation means; represent clients and carry out activities concerning customs matters, insure benefits and refunds for road tolls, acquire and present transportation and other documents regarding the forwarding services in foreign trade.

Article 28

Enterprises engaged in international transport of goods and passengers may transport goods and passengers in the international railroad, road, air and lake traffic, as well as to negotiate, service and mend transportation means and spare parts.

Article 29

Enterprises performing international traffic and agency activities may represent and mediate in transport of goods and passengers by international traffic and other matters connected with the transport.

Activities of Para 1 of this Article, as regarded by this Law, are: reservation of sufficient space for goods in transportation means on behalf of the client, providing enough goods for the transportation vehicle of the client, providing means of transportation for goods and passengers, sale of tickets and other activities regarding representation and mediation in international transport.

Enterprises of Para 1 of this Article may conclude agreements on international traffic and agency activities on behalf of the client or may only mediate in the conclusion of the agreements.

Article 30

Enterprises engaged in tourist services to foreign countries may provide services to foreign persons, and especially: hotel services (accommodation, meals, etc.) and tourist services, may organize tourist tours and excursions in the Republic of Macedonia and abroad, visits of cultural, economic, sports or other manifestations, sports fishing and hunting, may rent vehicles and vessels, keep and maintain foreign vessels, provide services regarding hazard games, as well as tourist tours and excursions abroad for domestic clients.

Services of Para 1 of this Article, as regarded by this Law, are also services for congressional, health and recreation tourism, as well as traffic services in the international tourism.

Article 31

Enterprises engaged in providing means of transportation may provide fuel, oils, spare parts, industrial and other goods for domestic and foreign means of transportation, as well as provide industrial and other goods for their crews and passengers, if they travel to foreign countries.

Enterprises providing dockside services may provide services regarding acceptance and forwarding vessels and passengers, keeping ships and cargoes, reloading and storing of goods, providing necessities for foreign means of transportation, renting means of transportation and equipment and other services.

Services including storing of goods may also be provided at railroad stations and other places for international transportation, as well as at other public warehouses.

Services of storing goods, as regarded by this Law, include acceptance, keeping and assortment of foreign goods and other activities regarding goods by an order of foreign persons, such as: loading, unloading, customs formalities and insuring goods.

Enterprises providing airport services may accept and forward foreign goods and passengers in the air traffic, services connected with landing and flying over of foreign planes, as well as acceptance, provision and forwarding of those planes.

Article 32

Enterprises registered for organizing international fairs may organize fairs, exhibitions and other forms of presentation of economic and other activities in the Republic of Macedonia and abroad, as well as to provide other services in organizing international fairs.

Enterprises of Para 1 of this Article may participate in international fairs and exhibitions and other forms of presentation of economic and other activities, as well as exhibit its own products alone or in a cooperation with other enterprises abroad.