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MEDT drops trade sanctions against Italian importer

18.10.2017

Subject of Complaint: Ministry of Economic Development and Trade (MEDT)

Complaint in brief: On August 17, an Italian company that imports walnuts to Italy from Ukraine addressed the Council with a complaint against the MEDT. When irrigation equipment was delivered to a Ukrainian counterparty at the beginning of 2017, the European company turned out to be on the MEDT sanctions list, which that firm did not know. The importer, who has settled its accounts in time and in full with suppliers, became concerned and upset. Moreover, the enterprise had never received any notices from the MEDT regarding the imposition of sanctions. More importantly, this caused the Italian importer difficulties in its international operations, as every delivery now required separate licensing. 

Meanwhile, the Complainant had enquired with the MEDT three times to find out why sanctions were being imposed and cancel them. The Complainant found out that the trade restrictions had actually been the initiative of the State Fiscal Service. According to its data, one of the Ukrainian exporters had not received payment from the Complainant for the supply of commodities in time in 2015. After the Complainant’s appeal in March 2017, the SFS agreed with the firm’s arguments and sent a request to MEDT to drop the sanctions. However, the trade restrictions against the importer were still in place at the time when the Complainant turned to the BOC.

Actions taken: The BOC investigator determined that yet another international counterparty was involved in the payment scheme between the Complainant and the Ukrainian exporter. This counterparty actually did receive the payment from the Italian company. With this explanation, the investigator turned to MEDT and SFS and proposed that the sanctions against the importer be dropped.  The investigator also asked the Deputy EDT Minister to personally follow up on the case. 

Result achieved: On October 5, the MEDT issued an order dropping sanctions against the Italian company. The case was successfully closed.