The agreement between the Government of the Republic of Kazakhstan and the Government of Georgia on the principles of collection of indirect taxes during the exporting and commodity import (works, services)

of November 11, 1997

The government of the Republic of Kazakhstan and the Government of Georgia which are hereinafter referred to as the Party, aiming at development of trade and economic relations, creation of equal opportunities for business entities and to establishment of conditions for fair competition, being guided by regulations and rules of international trade,

agreed as follows:

Article 1 General determinations

For the purpose of this agreement:

a) the term "indirect taxes" means the value added tax and excise (the excise tax or collection);

b) the term "zero rate" means taxation on value added at the rate zero percent that is equivalent to full relief from the value added tax;

c) the term "principle of the destination" means application of zero rate when exporting from customs area of one Party and taxation when importing on the effective rate established by the national legal system of other Party;

d) the term "competent authorities" means from the Kazakhstan side the Ministry of Finance of the Republic of Kazakhstan, from the Georgian side the Ministry of Finance of Georgia.

The article 2 Principle of Collection of Taxes when exporting

The parties will not assess with indirect taxes the goods (works, services) exported from the territory of one Party on the territory of other Party.

The article 3 Principle of Collection of Taxes when importing

1. The goods imported on the territory of one of the Parties (work, service) exported from the territory of other Party are assessed with indirect taxes in the country of the importer according to its legislation. Taxation will be performed by customs authorities in case of commodity importation on customs area of the Parties.

2. In case of commodity import taxation (works, services) exported from the territory of other Party, the Parties will apply the same rates of taxes, privileges and procedure of payments, as established for similar goods (works, services) made (implemented) in their domestic market.

Article 4 Solution of Matters of Argument

All disputes and disagreements between the Parties concerning interpretation and application of provisions of this agreement will be solved by consultations and negotiations of the Parties by competent authorities.

Article 5 Final provision

1. This agreement becomes effective from the date of the notification the Parties about accomplishment of all necessary interstate procedures.

2. This agreement will be applied only to goods (works, services) delivered after its entry into force.

3. Each Party can terminate this agreement, having sent the written notice to other Party not later than six months to exit, having settled the financial and other liabilities which arose during operation of the Agreement.

4. The parties will hold if necessary consultations for assessment of the course of implementation of this agreement and feasibility of introduction in it of amendments and changes. Terms of such consultations are determined by the Parties in addition.

It is made in Almaty on November 11, 1997 in two authentic copies, everyone in the Kazakh, Georgian and Russian languages, and all texts are equally authoritative.

For the purposes of interpretation of provisions of this agreement the text in Russian is used.

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