The system of gas dual pricing in Russia: compatibility with WTO rules

Sergey Ripinsky

World Trade Review, 2004, vol. 3, issue 3, 463-481

Abstract: The gas dual-pricing system in Russia has been a highly contentious issue in the context of the ongoing negotiations on the accession of Russia to the WTO. At present the domestic price for gas in Russia is set by the Government at a level several times lower than the freely negotiated export price. In the view of the European Union and other WTO Members such a policy is not permitted under WTO disciplines, while Russia persists in viewing the existing dual-pricing system as WTO consistent. The article pursues a legal assessment of the issue, demonstrating that although the Russian gas pricing system can be considered a subsidy, this subsidy is non-actionable under the WTO rules. This means that Russia has merit in its attempt to keep the gas pricing system in place after it accedes to the WTO.

Date: 2004
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