Ukrainian steel producer Industrial Union of Donbass (ISD) has stated that it has successfully challenged in court via its subsidiaries Alchevsk Iron and Steel Works and Alchevsk By-Product Coke Plant the decree of the Cabinet of Ministers of Ukraine dated March 13, 2013, imposing importation restrictions on coking coal and coke.
Accordingly, on June 10 the Ukrainian court of first instance ruled against the decree, cancelling it. However, the judgment of the Ukrainian court has not come into force yet. If the Cabinet of Ministers of Ukraine does not file an appeal, the judgement will come into force 10 days after the Cabinet of Ministers receives the full text of the judgement.
During the court hearings, ISD argued that, in the process of preparation and approval of the decree in question, the Cabinet of Ministers of Ukraine violated numerous Ukrainian laws (Law "On Cabinet of Ministers of Ukraine", Law "On Foreign Economic Activity", Law "On Basics of State Regulatory Policy in Sphere of Business Activity") and international treaties to which Ukraine is a party (General Agreement on Tariffs and Trade 1994 and Agreement on CIS Free Trade Zone).
Violation of General Agreement on Tariffs and Trade 1994 by Ukraine as a result of introduction of importation restriction on coking coal and coke in accordance with the decree was considered at the meeting of the World Trade Organization Committee on Import Licensing on April 22 this year and at the meeting of the World Trade Organization Committee on Market Access held on May 7. At the meetings, Ukraine argued that it introduced the coking coal and coke import restrictions in order to protect human life and health against alleged threat of self-inflammation of overladen Ukrainian coking coal storage facilities, which was the only legal argument used by the Ukrainian government to justify implementation of import restrictions under General Agreement on Tariffs and Trade 1994. The Ukrainian government intends to unload Ukrainian coal storage facilities by limiting access to foreign coal and thus forcing Ukrainian producers to buy Ukrainian coal. However, during the court hearings, initiated by ISD, the Ukrainian government failed to provide any evidence substantiating the danger of self-inflammation from the storage of coal.