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The Croatian Customs System

Market Research: Customs Procedures for

Meat, Pharmaceuticals, and Chemicals

Zagreb, 2010

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1. OVERVIEW AND KEY FACTS OF CROATIA…………3 1.1 Current situation in Croatia………………………………………………………...4 1.2 International Trade in Croatia……………………………………………………..4

2. IMPORTS…………………………………………………..5 2.1 Import Requirements and Documentation.......................................................5 2.2 Temporary Entry..............................................................................................6 2.3 Labeling and Marking Requirements...............................................................6 2.4 Prohibited and Restricted Imports...................................................................7 2.5 Customs Regulations and Contact Information...............................................7 2.6 Standards Organizations.................................................................................7 2.7 Product Certification.........................................................................................8 2.8 Publication of Technical Regulations...............................................................8 2.9 Import and Export Restrictions.........................................................................8 2.10 Value-Added Tax (PDV)................................................................................9 2.11 Terms of Payment........................................................................................ .9 2.12 Temporary Admission of Goods.................................................................. .9 2.13 Import Procedures for Free Circulation........................................................10 2.14 Customs Warehouses and Terminals..........................................................10 2.15 Free Zones...................................................................................................11 2.16 Customs Duties............................................................................................13

3. FISCAL FRAMEWORK…………………………………13 3.1 Changes for 2013..........................................................................................14 3.2 Customs duties and Harmonization with EU legislation.................................14 3.3 Classification and Tariffs................................................................................15 3.4 Quotas...........................................................................................................15

4. CUSTOM PROCEDURES……………………………...15 4.1 Customs Clearance.................................................................................15 4.2 Meat.........................................................................................................15 4.2.1 Belgium and meat export – import process into Croatia.................16 4.2.2 Importing procedures of meat into Croatia......................................17 4.3 Pharmaceuticals......................................................................................18 4.3.1 Trade in and Production of Drugs and Medical Products..............18 4.4 Chemicals................................................................................................20

5. FORWARDING AGENTS…………………….…………21

6. THE FUTURE OF CUSTOM (E-CUSTOMS)…………21

7. USEFUL LINKS………………………………………….23

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1. OVERVIEW AND KEY FACTS OF CROATIA

Croatia is a Central European and Mediterranean country, culturally and historically linked to Central and Eastern Europe, with a good geo-strategic position. It borders with Slovenia, Hungary, Serbia and Montenegro, Bosnia and Herzegovina and has a marine border with Italy.

During the 20th century, Croatia was part of the Socialist Federal Republic of Yugoslavia, ruled under the communist system, i.e. having state-owned companies. Croatia became an independent state in 1991 when a democratic, multi-party political system was adopted and political/economic reforms were implemented. Over the past few years, Croatia has been making efforts to join European Union.

Economic Index1 CROATIA

Population 4,489,409 (July 2009 est.)

Human Development Index (IDH) 0.871 (2007) *

GDP growth rate in 2010 0.3%

GDP GDP (per capita)

€47.4 billion

€ 10.700

GDP (Composition by sector) - Agriculture - Industry - Services

7% 31.6% 61.4%

Inflation Rate 2.4% (2009 est)

Average Monthly Salary (gross) Average Monthly Salary (NET)

€1044 € 734

Unemployment Rate 16.1 (2009 est)

Exports, m EUR 76,9

Imports, m EUR 71,4

Global Competitiveness Index 4.03

Main Commercial Partners

Italy Bosnia and Herzegovina Germany Slovenia Austria

Currency Kuna (HRK)

Average Exchange Rate/Euro Average Exchange Rate/Dollar

7.27 HRK 5.28

Table 1: Economic Indicators of Croatia

1 https://www.cia.gov/library/publications/the-world-factbook/geos/hr.html

http://hdrstats.undp.org/en/countries/country_fact_sheets/cty_fs_HRV.htm *

http://www.weforum.org/pdf/GCR09/GCR20092010fullrankings.pdfl

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1.1 Current situation in Croatia

The Croatian economy is showing encouraging results. Growth in domestic demand sustains the economic dynamism, which in turn is stimulated by the recent credit boom following the privatization of banks and their acquisition by foreign capital, investments (mainly in road construction), the dynamism of the tourism sector and SMEs' profits. GDP growth has been progressive: 4.7% in 2006 and 5.5% in 2007. In order to maintain the national economy, the Croatian government has re-tightened its budget. It has started privatizations and adopted policies that promote opening the country's economy to international trade.

Nevertheless, economic growth has slowed down since 2008 and especially in 2009, mainly because of low consumption in the country, the drop in domestic demand and exports. Croatia faces a high unemployment rate, around 15% of the active population. Inflation is under control, remaining at less than 3%. Croatia was affected by the economic crisis but to a lesser extent, compared to other European countries. The country adopted economic stabilizing measures at the beginning of the crisis and injected funds into the banking sector, which later enabled it to better face the effects of the crisis. Nevertheless, there was a slowing down of the economy in Croatia and the tourism sector, one of the economy's drivers, had to deal with a drop of in-coming tourists. (http://www.interex.gr/uk/countries-trading-profiles/croatia/presentation)

1.2 International Trade in Croatia

Croatia joined the WTO in 2000 and has also signed an Agreement of Association with the European Union in 2001. IN 2003 Croatia joined the Central European Free Trade Agreement (CEFTA)., in 2002 joined EFTA.

For more details about Free Trade Agreements, please visit http://www.mingorp.hr/defaulteng.aspx?id=213

Croatia's economy is heavily dependent on foreign trade. The contribution of foreign trade to the GDP was 105% in 2008. Croatia's three main trade partners are Italy, Bosnia and Germany. Its three main suppliers are Italy, Germany and Russia. Croatia mainly exports mineral fuels, ships, boats, electric &mechanical machinery, equipment, wood and wooden articles. Fuels, equipment and machinery as well as vehicles are also significant import items. The most promising sectors are tourism, construction, telecommunications, and retail sales.

One of the important players in Croatian international trade is the Croatian Chamber of Economy (CCE – www.hgk.hr).

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As the 34th member of Eurochambres, the Association of European

Chambers, it has taken part in a number of their initiatives so far.

The European Business Panel (EBP) is a common initiative of European chambers (coordinated by Eurochambres) for collecting and studying the opinions of member companies on various topical issues. Its results are used to strengthen the influence of the network of European chambers.

The Croatian Chamber of Economy also co-operates with the World Trade Centre UNCTAD/WTO (ITC) in Geneva, which stands out in promoting the effects of WTO rules on trade and business in the broadest sense, especially in transitional and developing countries, through the World Trade Net initiative.

Since 1993, the CCE has been a member of the International Chamber of

Commerce in Paris (ICC), where it actively participates in the work of several commissions and specialized groups. In order to represent even more actively all business associations before the ICC, the Croatian National Committee of the International Chamber of Commerce (ICC Croatia) has been established by the CCE and the following associations: Croatian Chamber of Crafts and Trades, Croatian Employers’ Association, Croatian Banking Association and Croatian Bar Association. The National Committee makes it possible for all members to participate in the work of the ICC’s commissions, to use the ICC’s publications, attend international congresses, seminars and conferences, and to participate in defining the course and formulating the rules of work.

2. IMPORTS

2.1 Import Requirements and Documentation

A Croatian importer is responsible for providing the required import documentation, which consists of common trade, transport, and customs documents, as well as certificates required for quality control and licenses where appropriate. The Single Administrative Document (SAD) that is used by EU and most other countries is the key customs document in Croatia as well.

In order to assure the quality of the products that enter to Croatia, all of them are subject to quality control by market inspection officials. This procedure will assure that the products meet Croatian standards, whether they are appropriately labeled and packed, and whether they have the required documentation or quality certificates.

The products that are subject to quality control are the ones that could be dangerous. These products include food, like meat and live animals; chemicals and pharmaceutical products, as well, furniture, cement, textile, electric and gas appliances, agricultural equipment, etc.

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According to the Decree Specifying Goods for Which a Quality Certificate is required, these products must pass quality control tests at the manufacturer’s or importer’s warehouse before they are put on the market.

When applicable, products also have to pass sanitary, phytopathological, or veterinary control. Information on sanitary requirements can be obtained from the Ministry of Health4, and information on phytopathological and veterinary requirements from the web site of Ministry of Agriculture, Fisheries and Rural Development, http://www.mps.hr/default.aspx?id=6376 .

2.2 Temporary Entry

Temporary entry of products into Croatia is regulated in accordance with the EU Customs Code and international customs conventions. Croatia is a party to the Customs Convention on Carnet ATA for Temporary Import of Goods. Presentation of an ATA carnet or TIT carnet facilitates the process. Carnets are usually valid for one year and list the products to be entered on a duty-free basis.

The carnet must be presented upon entry. Customs will stamp the carnet thereby validating it. Upon departure, the carnet must again be presented for validation, confirming that the product is being transported out of the country. Failure to re-export the goods results in application of the duties.

2.3 Labeling and Marking Requirements

Labels must contain the following information: name of the product, full address of the importer and the country of origin, net quantity/weight/volume, ingredients, manner of storage (transport, use or maintenance), and pertinent consumer warnings, including the information on any genetically modified organism (GMO) ingredients as defined by the Law on Genetically Modified.

Technically complicated products must be accompanied by instructions on usage, the manufacturer's specifications, a list of authorized maintenance offices, warranty information, warranty period, and other applicable data. All information must be in Croatian and affixed to (or accompanying) each product before it is put on the market.

Until 2007, the Croatian symbol "C" was obligatory (granted by a certified testing institution) and CE mark could not act as a substitute. Reportedly, a new regulation that came into power on January 1, 2007 made the CE mark valid in Croatia as well.

However, in practice, the legislation that was substantially changed during the past two years is still being fine-tuned, coordinated and enforced. Further than labeling the goods in the Croatian language, exporters to Croatia must consider other labeling requirements, such as name of product, type of product,

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the producer, country of origin, the importer and the quality/weight of the product. Food products require additional labeling detail, such as the list of ingredients, additives, production and expiry dates and other relevant information regarding preparation. Furthermore, medicine, textiles and footwear require additional labeling.

The Ministry of Economy provides information on labeling; details are listed on its web site http://www.mingorp.hr/defaulteng.aspx

2.4 Prohibited and Restricted Imports

There are no prohibited imports. Import licenses are required for arms/ammunition, military and police equipment, mobile radio sets, drugs, narcotics, antiquities, precious metals, waste, nuclear technology, chemical weapons’ ingredients, and substances harmful to the ozone layer. Import licenses are required for a few products originating in countries which are not members of the WTO (for iron tubes and bars, and fertilizers). Import licenses are issued by the Ministry of Economy, Labor and Entrepreneurship. Further information in its website: http://www.mingorp.hr/defaulteng.aspx

2.5 Customs Regulations and Contact Information

Most import regulations were translated into English during the WTO accession process and are available on the Ministry of Economy, Labor and Entrepreneurship website http://www.mingorp.hr/defaulteng.aspxv. However, to learn about the customs duties, taxes, and quality requirements for a specific product, exporters must contact a Croatian freight forwarder that can be found in the following link http://www.hr/wwwhr/tour/travel/forwarding/index.en.html.

For contact information for Croatian Customs please visit the following website: http://www.carina.hr/engindex.htm8.

2.6 Standards Organizations

The institution responsible for preparation, adoption, editing and publication of Croatian standards is the Croatian Standards Institute, for more information go to its web site: http://www.hzn.hr/

The Croatian Accreditation Agency is the institution responsible for granting accreditation to testing and calibration laboratories, inspection and conformity assessment boards, and to certification boards for products, management system and personnel (such as ISO Standards).

For further information about the agency and for a full access of the institutions authorized by the Croatian Accreditation Agency for testing and conformity visit http://www.akreditacija.hr/EN

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2.7 Product Certification

Every certified product must carry a certification marking. The certification marking indicates that the product has been appropriately tested and that it complies with the provisions of the relevant regulations.

Certain imports, like food, cattle, consumer goods, medicines, etc. must be accompanied by special certificates (sanitary certificate, veterinary and phytopathological certificate, certificate of quality). Certificates are issued by competent institutions, dependent on the type of goods. In the case of meat products or products that contain meat or live animals for consumption they need a certificate issued by the Ministry of Agriculture, Fisheries and Rural Development.

The certificates can be found on http://www.mps.hr/default.aspx?id=6376

Goods which must undergo the prescribed procedure of obligatory certification or homologation must be tested and certified by an authorized organization and adequately labeled before being traded.

The organizations authorized to perform certifications can be found on the web site, http://www.akreditacija.hr/EN,.

The Accreditation Agency for testing and conformity has all the requirements needed and the process to get the certification.

The State Office for Metrology is the institution responsible for drafting metrology legislation and inspection; also responsible for homologation of vehicles, for further information follow the next link http://www.dzm.hr/en/

2.8 Publication of Technical Regulations

Technical regulations are published on the Croatian Standards Institute’s. No foreign entities can propose draft standards. Further information can be found on http://www.hzn.hr/english/normoteka.html

2.9 Import and Export Restrictions

Special permits need to be obtained for the import and export of certain goods such as works of art, precious metals, weapons, military vehicles, ammunition, antiques, certain ores, drugs, poisons, etc. This permit is issued by the appropriate Ministry (e.g. the Ministry of Defense for weaponry and ammunition, the Ministry of Culture for works of art, the Ministry of Health for medicines, etc.). This permit needs to be issued by the Croatian company. It can be obtained through the Ministry of Economy, Labor and Entrepreneurship http://kontrolaizvoza.mingorp.hr/default.aspx?id=130

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2.10 Value- Added Tax (PDV)

The base value of goods imported into Croatia, and on which Croatian import VAT will be levied, will now also include expenses such as commissions, packing and transport charges, as well as insurance costs incurred up to the first destination within Croatia. A 23% VAT is chargeable on goods entering Croatia in the normal way and at the same rate as domestic supplies. Certain goods attract special excises, including oil derivatives, tobacco products, beer, nonalcoholic drinks, and certain new imported cars.

If you wish like to learn more about VAT in Croatia, or are interested in recovering your business VAT there please contact the Economic Commercial office of the Belgium Embassy.

Pantovčak 125b1 HR - 10000 - Zagreb (Croatia) Tel. +385 1 457 74 44 - fax +385 1 457 74 45 e-mail : office@beltrade-croatia.com

For more information about taxes visit the Ministry of Finance: Tax Administration web site http://www.poreznauprava.hr/en/porezi/v_poreza.asp?id=b01d1#

http://www.meridianglobalservices.com/croatiavatchangesjan2010/

2.11 Terms of Payment

The standard methods of payment used in international commercial transactions can be used when doing business with Croatian companies. The transfer of payments between countries is carried out using the agreed-on convertible currency, the Kuna or the convertible currency. In the absence of any agreement, payment transfers are carried out using convertible currencies or Kuna.

2.12 Temporary Admission of Goods

According to the Croatian Customs Act and the Istanbul Convention on the Temporary Admission of Goods year, goods temporarily imported into Croatia may be completely or partially free from customs duties and taxes. The imported goods must be intended for temporary usage (not for consumption), they must remain on the territory of Croatia only for a limited period of time and be re-exported in an unaltered condition.

For example, the products imported for a Trade Fair must be the same at the time they enter and get out of Croatia.

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The Customs Administration of the Croatian Ministry of Finance has authorized the Croatian Chamber of Economy to issue ATA Carnets and to act as the guaranteeing association.

Customs duty is the only import duty payable on the import of goods; there are no duties for exports. The duties are set out in the Customs Tariff, and range from 5 to 25 percent. Preferential rates are determined under the terms and conditions set out in each individual agreement for imports from these countries of free trade agreements with Croatia

2.13 Import Procedures for Free Circulation

All consumer goods must be declared and cleared. Then following documents must be presented, together with the Single Administrative Document (SAD), when clearing consumer goods:

An import license or permit, if prohibitions or restrictions are applied to the import of goods;

A certificate of origin if preferential duties are established for the goods being imported;

Sanitary, veterinary, hygiene and quality certificates if the goods are of a type which may be imported only after presenting documents certifying that their quality meets established requirements;

A customs invoice. Under the new Customs Code not all firms must present customs documentation at time of importation: "reliable" importers have the option of batching customs documentation, and submitting payment at a later date.

Purchase and sale documents (contracts, invoices); and

Transport documents (waybill, CMR waybill, CARNET TIR book).

2.14 Customs Warehouses and Terminals

No customs duties or taxes are imposed on merchandise stored in a customs warehouse until it leaves the warehouse for the purpose of free circulation. But they charge a space storage use fee. This procedure is termed a suspensive arrangement. The provisions of the law distinguish two classes of customs warehouses: public customs warehouses, which are available for use by paying the corresponding fee, and private customs warehouses, which are reserved for the warehousing of goods by the warehouse keeper.

2.15 Free Zones

The free-zone areas are under customs control. Goods, means of transport and persons entering or leaving a free zone area are consequently under customs control, and can be subject to customs inspection. There is no time limit for goods in a free zone.

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Goods of foreign origin placed in a free zone can be:

- Released for free circulation under the conditions set forth for such procedure

- Placed, without any specific approval from the competent customs office, under the standard common procedures relating to either preservation, or improvement of utility and commercial features, of the goods for distribution and resale.

- Placed under inward processing under the conditions laid down for such procedure.

- Placed under "processing under customs control" in accordance to the conditions laid down for such procedure; or temporarily admitted under the conditions laid down for such procedures.

http://infoexport.gc.ca/eng/document.jsp?did=18776&cid=20R&oid=173

The new Customs Act regulates the rights and obligations of persons and the authority of customs services with respect to the movement of goods in passenger and goods transport between Croatia and foreign countries. A uniform customs declaration is used in the customs procedure, the content and form of which correspond to the documents used in the EU.

A customs declaration is also used in the transit procedure, which is very important for Croatia as a transit country. In addition, a new customs value declaration has been introduced which is in harmony with the rules of the 1994 GATT Agreement on the Implementation of Article VII. The law regulates the following customs procedures: free trade in goods, transit, and customs warehousing, inward processing, and processing under customs supervision, temporary import, and export procedures.

The Customs Tariff, the Customs Tariff Act and the Customs Act specify duties paid on imports. In accordance with the obligations assumed in Croatia’s negotiations on accession to the World Trade Organization, Croatia must gradually reduce the level of tariff protection. In the transitional period for industrial products between 2000 and 2005 (till 2007 for agricultural and food products), Croatia was required to reduce customs duties by the same percentage every year.

From 2002, a Customs Tariff compliant with the Combined Nomenclature of the EU has applied. The Customs Tariff for 2006 specifies import tariffs in line with the commitments assumed under arrangements with the WTO, and also in line with the Most-Favored Nation Clause and free trade agreements. Currently, the average customs tariff on industrial products is around 3% to 17.8 % depending on what it is, the agreement between the countries, and the parts that conforms the product.

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The general principle is that the tariff rates for raw materials and

intermediary products must be lower than those for finished or semi finished products. The maximum level of tariff protection for agricultural products and food is determined by a combined method (percentage per unit of quantity).

Tariffs per quantity unit for seasonal products are set in advance for the period of application, so that import conditions are known in advance for the entire year. For certain agricultural and food products, preferential tariffs have been set only for limited quantities (tariff quotas). Additionally, the Annex to the Customs Tariff shows quotas by country and quotas for imports from WTO member states.

Under the Agreement on Stabilization and Association between Croatia and the EU signed in 2001 (in the section almost entirely, and without a transitional period, lifted tariffs and other restrictions to imports from Croatia.

Quotas remain only for baby-beef, certain fish products and wine. Early in 2002, all tariffs and quantitative restrictions were lifted for most industrial products originating in the EU. Gradual adaptation applying to so-called “sensitive products” means that tariffs were lifted over periods of 2 or 5 years. Tariffs on agricultural and food products as well as fish originating in the EU are being gradually removed over a 6-year transitional period. However, tariff protection will remain for certain products even after the transitional period expires.

For the import of equipment, machinery, appliances, vehicles and their parts that have components manufactured in Croatia, the Croatian Government may set lower tariff rates or the rate called Slobodan (i.e. exempt from customs duty).

The same treatment applies to imports originating from the most underdeveloped countries, in accordance with the criteria of the UN Conference on Trade and Development (UNCTAD), and to the importation of mine removal machinery, appliances and equipment. 2

As mentioned under 1.2 (International Trade in Croatia), besides a free trade agreement with the EU, Croatia is a party of the Central European Free Trade Agreement (CEFTA / www.cefta2006.com – Albania, Bosnia-Herzegovina, Kosovo, Macedonia, Moldavia, Montenegro and Serbia).

Furthermore, Croatia has also a free trade agreement with the European Free Trade Association (EFTA - www.efta.int - Iceland, Liechtenstein, Norway and Switzerland) and, last but not least, with Turkey.

2 http://www2.hgk.hr/en/pdf/Partner_06_en.pdf

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For certain agricultural and food products, preferential tariff rates have been prescribed, only for limited quantities of those products (customs quotas). The Annex to the Customs Tariff presents quotas for each country, as well as quotas for the import of goods from the WTO member states.

2.16 Customs Duties

The goods imported into the customs territory of the Republic of Croatia shall be liable to the payment of import duties in accordance with the Customs Tariff and provisions laid down in the act and the Customs Tariff Act. There are 3 different types of tariffs in Croatia:

1. Ad valorem. That is expressed by percentage over the value of the invoice.

2. By quantity. 3. The combination of both.

The customs tariffs are based on a standard international classification system and on the European Union tariff codes. The Croatian Custom Law recognizes the following customs procedures:

Import for Free Circulation Transit Inward Processing Under Suspension System Inward Processing Under Drawback System Customs Warehousing (five categories) Processing Under Customs Control Temporary Admission Outward Processing

3. FISCAL FRAMEWORK

The Croatian tax system was completely revised in 1991.

Customs duties are one of the oldest forms of taxation, and are paid on goods that are imported. They are part of indirect taxes.

The point of customs duties is primarily to protect domestic production by

making imported goods more expensive. The second task of customs duties is fiscal, make up one of the revenues of the budget.

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In 2007, the Croatian general government budget received HRK 1.6 billion from Customs, i.e. about 1.5% of all tax revenues. After joining the WTO, Croatia agreed to reduce gradually its tariff barriers, by which custom duties would increasingly lose their character as an instrument of foreign trade and become just one of the sources of public revenues.

In this line, Croatia has committed to gradually lower the customs protections and applies contracts of free trade with 37 countries. This goes in favor of its attractiveness as a location for an exports oriented production.

According to the Stabilization and Association Agreement between the Republic of Croatia and the EU, signed in 2001, the EU has abolished customs for import on Croatian goods. Customs are completely abolished and there is no transition period or other limitations regarding the import of Croatian products into the EU. Moreover, customs for importing most of the industrial products with the EU origin into Croatia were also abolished from the beginning of 2002.

3.1 Changes for 2013

The aim of the Customs 2013 program is to help customs administrations in participating countries to facilitate legitimate trade and to simplify and speed up customs procedures. The program will start on 1 January 2008 and end on 31 December 2013.

3.2 Customs duties and Harmonization with EU legislation

On 1 January 2009, the new Regulation on the customs tariff for 2009 entered into force, thereby aligning the Croatian tariff with the 2009 Combined Nomenclature. The Act amending the Act on the Customs Tariff abolished the remaining customs fees, which were due on the customs declaration, thus aligning with the EU legislation in the area.

The Customs Union is a foundation of the European Union and an essential element in the functioning of the single market. The single market can only function properly when there is a common application of common rules at its external borders.

Taric is the Integrated Tariff of the European Communities. It comprises all

customs duty rates and Community rules applicable to the Community's external

trade. The European Community customs tariff has this Regulation as its legal

basis.

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Taric allows goods clearance by the Member States. It also provides the

best means of collecting, exchanging and publishing data on Community external

trade statistics.

The customs regime and tariffs of the Republic of Croatia are adapted to the Harmonized Customs Tariffs. Concessions and exemptions are available when goods for investment by a foreign person in a Croatian company are being imported. Equipment can be temporarily imported into and re-exported out of Croatia under a leasing contract. Customs rate for imported goods ranges between 5% and 25%. Over 96% of all goods listed in the Customs Tariff Schedule may be imported into Croatia without restriction.

Customs duty is calculated on the basis of the invoiced value of imported goods plus all foreign expenses incurred (transport costs and insurance to the Croatian border, commission fees paid to agents and bank expenses).

3.3 Classification and Tariffs

The Croatian Customs and Tariffs Act of 1996 created conditions for the entry of Croatia into international organizations such as the WTO. The nomenclature and numbering of goods are consistent with those applied internationally (harmonized customs tariffs). The rules governing the classification of goods within the nomenclature and numbering of goods enable the exact location of all items imported or exported to be determined.

The tariff rate applied to goods imported into Croatia is determined according to the level of the tariff base. The level of the tariff rate, depending on the type of goods, ranges from 5% to 25%.

3.4 Quotas

The government can restrict the imports of certain goods through the imposition of import quotas. These are valid for up to one year. Except for a small selection of items, the import of goods into Croatia is unrestricted.

https://www.uktradeinvest.gov.uk/ukti/appmanager/ukti/countries?_nfpb=true&portlet_3_5_actionOverride=%2Fpub%2Fportlets%2FgenericViewer%2FshowContentItem&_windowLabel=portlet_3_5&portlet_3_5navigationPageId=%2Fcroatia&portlet_3_5navigationContentPath=%2FBEA+Repository%2F323%2F226257&_pageLabel=CountryType1

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4. CUSTOM PROCEDURES

4.1 Customs Clearance

The goods imported into the customs territory of the Republic of Croatia

duties will be liable to the payment of import duty in accordance with the Custom Tariff and provisional laid down in the Custom Act.

4.2 Meat

Croatia by itself has had a large tradition of producing high quality food

under strict safety standards. As a result, Croatia has been seeking for the protection of imports into its domestic market, trying to focus in the safeguard of the regional frameworks with the well known habit of quality safe standards.

At the same time, because Croatia is in the process of accession to the EU, it is necessary to track the advancements of the Croatian Enlargement Strategy regarding to the Chapter 12 of Food Safety, Veterinary and Phytosanitary policy. The whole can be consulted in the following link http://ec.europa.eu/enlargement/pdf/croatia/screening_report_12_hr_internet_en.pdf.

This chapter tracks the advancements and the necessary adjustments that need to be followed in order to meet the EU requirements and to simplify the process. It reflects the EU's integrated approach to food safety aiming to assure a high level of food safety animal health, animal welfare and plant health within European Union through coherent farm-to-table measures and adequate monitoring, while ensuring the effective functioning of the internal market. In this domain the principal pre-requisites for Croatia, as candidate country, are the transposition of the EU legislation and its implementation by a properly structured and trained administration.

It is important to mention that Croatia is still applying national procedures in some areas, like in food safety, due to the fact that Croatia is not in EU yet. In this way, the country is protecting its market with its own procedures. That is why the Croatian government issued a Trade Barrier in sensitive products in order to protect the domestic market of harmful products.3 Thus, to import sensitive products into Croatia, it is necessary to issue safety and inspection certificates. These certificates are especially for meat, products that contain meat and, live animals.

3http://www.mps.hr/UserDocsImages/publikacije/brošura%20-%20Croatian%20Agriculture%20-%20Cho.pdf

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The veterinary certificates are issued by the Ministry of Agriculture, Fisheries and Rural Development. One example is the Domestic Porcine for Immediate Slaughter Consigned to the Republic of Croatia (HR-U-1-2-1 EU) 4.2.1 Belgium and meat export – import process into Croatia

In order to import meat from Belgium into Croatia it is necessary to follow some special procedures according to the Croatian Food Act:

The food importer must apply to the border veterinary inspector of the Ministry of Agriculture and Forestry, referred as the border sanitary inspector of the Ministry of Health, for a request to examine the food consignment that has been imported for the purpose of establishing safety.

Prior to import food, (meat in this case), it shall be required to have an obligatory certificate on safety or a regulated international certificate on safety. Therefore for products being imported can obtain international certificates that can be recognized based on bilateral and multilateral agreements issued by the competent authority of the exporting country.

Examination of the consignment for the purpose of establishing the safety of food is carried out at border veterinary crossings by the border veterinary inspector and in other places by the border sanitary inspector.

The customs office cannot carry out the customs procedure of clearing the food consignments through customs until the border veterinary inspector, the respective border sanitary inspector establishes the safety of the consignment and, through an official decision, approves its import. Until the customs procedures have been completed, the products may be kept in storage in customs warehouses.

For detailed information about the Food Act, retrieve the document through

the following link: http://www.hah.hr/pdf/The_Food_Act.pdf 4.2.2 Importing procedures of meat into Croatia

In order to import meat into Croatia, there are certain specifications that need to be followed. The requirements that must be fulfilled in the country of origin before bringing the product into the Croatian border are mentioned above.

After this process, there many other requirements that need to be fulfilled in order enter to the Croatian market:

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Overview of Import Procedures General Requirements:

- Summary Declaration - Customs Import declaration - Declaration of Dutiable Value - Commercial Invoice - Movement Certificate (EUR.1) - Certificate of Origin - Air Waybill - Bill of Landing - Rail Waybill - Waybill - Packing List

For example, in order to import swine meat, fresh and chilled or frozen,

with product description 0203, the following specific requirements are necessary:

- Permit to Import Species Covered by the CTES Convention - Permit to Import Animals and Animal Products - Certificate of Quality - Veterinary Health Certificate for Animal Products - Veterinary Inspection of Foodstuffs

The details of these requirements can be retrieved on the Market Access

Database web site: http://mkaccdb.eu.int/mkaccdb2/datasetPreviewIFpubli.htm?datasettype=draft&hscode=0203&countries=HR&datacat_id=IF&keyword=&submit=&license=false

All the tariff quotas required for any kind of meat and related products can be found on http://mkaccdb.eu.int/mkaccdb2/atDutyOverviewPubli.htm

The abovementioned websites also contain all the documents required for the process as well as the tariff and quotas needed to complete the process.

4.3 Pharmaceuticals

4.3.1 Trade in and Production of Drugs and Medical Products

The activity of testing, trading, producing, preparing and assessing the quality of drugs and medical products may be performed by legal entities and natural persons that meet special requirements set by the Minister of Health and Social Welfare.

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The Ministry of Health and Social Welfare issues the following:

1. Permit for the production of drugs and medical products 2. Permit for wholesale and retail trade in drugs and medical products (legal

entities or natural persons having approval from the Minister of Health to do business as pharmacists are not required to have the above permit).

In order to import Pharmaceuticals:

For example with medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of two or more constituents which have been mixed together for therapeutic or prophylactic uses, not put up in measured doses or in forms or packing for retail sale, with code 3003, it is necessary to fulfill the following requirements General Requirements:

- Summary Declaration - Customs Import declaration - Declaration of Dutiable Value - Commercial Invoice - Movement Certificate (EUR.1) - Certificate of Origin - Air Waybill - Bill of Landing - Rail Waybill - Waybill - Packing List

Besides, the general requirements, there are specific requirements:

- registration of Medicines - Registration of Variations Medicines - EU Registration of Medicines - License for Dealing in Medicines and Narcotics - Permit to Import Narcotics and Psychotropic Substances - Permit to Import Species Covered by the CITES Convention - Approval to Import Non-Registered Medicines and Medical Devices - Sanitary Certificate

Details and the documentation required for each of the requirements

mentioned above con be consulted in the following link: http://mkaccdb.eu.int/mkaccdb2/datasetPreviewIFpubli.htm?datasettype=draft&hscode=3003&countries=HR&datacat_id=IF&keyword=&submit=&license=false

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The tariff applied to the product 3003 and all pharmaceuticals tariffs can

be consulted in the following link: http://mkaccdb.eu.int/mkaccdb2/atDutyOverviewPubli.htm?datasettype=get

Some substances are free of duties. For detailed information contact the Economic and Commercial Office of the Belgium Embassy Pantovčak 125b1 HR - 10000 - Zagreb (Croatia) Tel. +385 1 457 74 44 - fax +385 1 457 74 45 E-mail: office@beltrade-croatia.com

For information and regulations regarding to medical devices consult the

Medical Devices Act http://www.almp.hr/upl/zakoni/zakoni_5_en.pdf and for medicaments consult the Medical Products Act on:

http://www.almp.hr/upl/zakoni/zakoni_5_en.pdf

For further questions and detailed information, visit the website of the agency for Medicinal Products and Medical Devices

http://www.almp.hr/?ln=en&w=obrasci

4.4 Chemicals

Chemicals are everywhere; they are an essential component of our daily lives. At the same time, some chemicals can severely damage health. Others could be dangerous if not properly used. There is a worrying increase in health problems that can be partially explained by the use of chemicals. Some man-made chemicals are found in the most remote places in the environment, but also in animals and humans. In the mid-nineties, the increased insight in the possible negative effect of chemicals led to the awareness, that the EU legislation then in force did not and could not provide sufficient information about chemicals to judge scientifically. The EU was on an unsustainable course in the chemicals sector.

HZT is a governmental institution, property of the Government of the Republic of Croatia, responsible for the prevention of poisoning and the help in diminishing the consequences of poison-related accidents.

In toxicological protection key activities are:

- education about the protection against dangerous chemicals, - evidence about toxins in production, import, export, use, marketing, retail trade, caring for and evidence about people who work with chemicals,

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- work on the prevention of chemical accidents, care for accidents and elimination of their consequences, - all other jobs for the prevention of accidents with chemicals or relieve of

their consequences

There are a wide variety of chemicals that are used for different purposes. These chemicals are listed and can be consulted in http://mkaccdb.eu.int/mkaccdb2/datasetPreviewIFpubli.htm?datasettype=prod In order to import chemical, there are general and specific requirements. The general Requirements are:

- Summary Declaration - Customs Import declaration - Declaration of Dutiable Value - Commercial Invoice - Movement Certificate (EUR.1) - Certificate of Origin - Air Waybill - Bill of Landing - Rail Waybill - Waybill - Packing List

The specific requirements depend on the type of chemical and who is importing the chemicals. Some chemicals require certain inspections, licenses and, certificates. In addition, there are a chemicals do not have any specific requirements but the importer could be a non-WTO member, so the importer will need a permit to import products.

These specifications are listed and can be consulted in the following link

http://mkaccdb.eu.int/mkaccdb2/datasetPreviewIFpubli.htm?datasettype=prod

Some types of chemicals require certificates that are only issued by competent entities.

These entities can be found in http://www.akreditacija.hr/registar/EN

5. FORWARDING AGENTS

To contact any forwarding agent please visit:

http://www.wlw.hr/en/CompaniesByProduct/0000096340/freight-forwarding agencies.aspx?searchType=simpleproduct&search=forwarding

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6. THE FUTURE OF CUSTOM (E-CUSTOMS)

Twinning between Italy and Croatia

With the idea to develop new technologies in the Republic of Croatia and with the desire to be ready for the European Union enlargement, Croatia has already signed the twinning with Italy to develop new technology and to manage electronically the export operation from the lodgment of the declaration by traders till the physical exit of the goods from the EU territory, including the safety and security controls.

Advantages:

- Simplification of the customs procedure as the presentation of paper declarations will not be required.

- Efficiency of the customs authorities in handling export movements of goods in terms of better control.

- Flexibility in connection of economic operators with the customs authorities.

- Trade facilitation for the economy (import/export) - Acceleration of cross border traffic. - Integration of the Croatian Customs Information System with the EU

Customs Information Systems. - Provide support to the Croatian Custom Administration (CCA) in ECS

implementation project management. - Will provide and essential contribution to the existing IT structures and

project management. - Support to the CCA in quality control of the software development project

for the national ECS – compatible Transit software.

As it is written in the article number 29, it is well known that Croatia has been doing its best trying to be part of the EU and to achieve the standards of the IT Systems structure and projects in relations with the enlargement of the European Union.

With this aim, Croatia already signed the Twinning Croatia – Italy

http://www.mingorp.hr/UserDocsImages/STRATEGY%20FOR%20THE%20DEVELOPMENT%20OF%20ELECTRONIC%20BUSINESS%20IN%20THE%20REPUBLIC%20OF%20CROATIA%20FOR%20THE%20PERIOD%202007-2010.pdf

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By adopting the Operational Plan for the implementation of the e-Croatia 2007 Program, with an overview of the activities for 2007, the Government of the Republic of Croatia has established the obligation to adopt a Strategy for the development of electronic business in the Republic of Croatia for the period 2007-2010

In 2007, as many as 94% of the total number of customs declarations were submitted electronically to the Customs Administration.

7. USEFUL LINKS

UK Trade & Investment. (2008). Countries: Europe – Southern Europe: Croatia. Retrieved on March 23, 2010, from https://www.uktradeinvest.gov.uk/ukti/appmanager/ukti/countries?_nfpb=true&portlet_3_5_actionOverride=%2Fpub%2Fportlets%2FgenericViewer%2FshowContentItem&_windowLabel=portlet_3_5&portlet_3_5navigationPageId=%2Fcroatia&portlet_3_5navigationContentPath=%2FBEA+Repository%2F323%2F226257&_pageLabel=CountryType1

WTO. (2010) Tariff. Retrieved from

http://www.wto.org/english/tratop_e/tariffs_e/tariff_data_e.htm WTO. (2009). Trade Profiles 2009. Retrieved from

http://www.wto.org/english/res_e/publications_e/trade_profiles09_e.htm Foreign Affairs and International Trade Canada. (2010). Import Regulations –

Croatia. Retrieved on March 23, 2010 from http://infoexport.gc.ca/eng/document.jsp?did=18776&cid=20R&oid=173

WTO. (2010). Croatia Profile. Retrieved from

http://stat.wto.org/TariffProfile/WSDBTariffPFView.aspx?Language=E&Country=HR

BelgianMeat.com (2010). Belgian Meat. Retrieved from

http://www.belgianmeat.com/en/sector/index.phtml NA. (2009). Food Safety and Nutrition Croatia. Retrieved from

http://www.seefsnp.org.yu/documents/croatia/Croatian%20Country%20profile.pdf

Croatian Food Act. Retrieved from http://www.hah.hr/pdf/The_Food_Act.pdf