The article discusses how subsidies and custom duties affect the competitiveness of agricultural production in Bosnia and Herzegovina. Lower subsidies for domestic producers compared to other countries can make them less competitive in the market. The study uses the OECD's PSE indicator to measure the level of subsidies, showing that in 2010, the Republic of Srpska had subsidies amounting to 12.2% of its agriculture gross value added. Livestock production receives more subsidies than crop production, indicating a trend of increasing support for livestock and decreasing support for crops. This imbalance in subsidies can put domestic producers at a disadvantage in competing with imported products, especially when imports have low or no customs charges.