Georgia bans re-export of U.S. vehicles to Russia from Aug, re-export of EU vehicles from Sept

TBILISI. Aug 3 (Interfax) - Georgia will ban the re-export of vehicles from EU member states to Russia starting from September 26, the Georgian Finance Ministry's Revenue Service said.

The ban derives from the 11th package of sanctions against Russia approved by the European Union in June 2023.

The re-export of vehicles from the United States to Russia has been banned since August 1 due to U.S. sanctions, the service said.

Georgia does not make cars, but Georgian car dealers procure very large amounts of vehicles from the United States, the European Union and Japan, most of them second-hand. Georgia has a network of car repair shops, and the cars are mostly sold to former Soviet republics. New cars are also supplied via Georgia but on a much smaller scale.

Car re-export taxes and duties are a chief source of revenue for the Georgian budget. According to the National Statistics Office of Georgia, cars topped the list of the ten main export commodities in January-June 2023. Car sales yielded $990.9 million or 32.5% of all exports.

This includes 3,786 cars worth more than $52.5 million that were exported to Russia in the first half of 2023, the National Statistics Office said.

Russia is not the primary buyer. It is behind Kazakhstan, Azerbaijan and Kyrgyzstan. According to the National Statistics Office, 13,916 vehicles worth $235.8 million were exported to Kazakhstan in the first half of this year, alongside 14,206 vehicles worth more than $226 million to Azerbaijan and 5,840 vehicles to Kyrgyzstan.