Non-Tariff

Barriers

Malcolm Langford Senior Researcher, Chr. Michelsen Institute (CMI)

Co-Director, Centre for Law & Social Transformation CMI & University of Bergen

What are non-tariff barriers?

Quantitative restrictions

Other non-tariff barriers

What are the main types

of non-tariff barriers ? Prohibitions – Absolute or conditional

Quotas – Global or Bilateral

Licensing – Automatic or Non-Automatic, and usually

contain some form of quota.

Indirect: e.g. State trading operations, mixing

regulations; minimum price, voluntary export

constraint

Council for Trade in Goods,

1996, Annex Prohibition

CP Prohibition except under defined conditions

GQ Global quota

GQC Global quota allocated by country

BQ Bilateral quota (i.e. anything less than a global quota)

AL Automatic licensing

NAL Non-automatic licensing

STR Quantitative restriction made effective through state-trading operations

MXR Mixing regulation

MPR Minimum price, triggering a quantitative restriction

VER "Voluntary" export restraint

add the following suffixes to the above as appropriate:

-S Seasonal restriction

-X Export restriction

Wikipedia Non-tariff barriers to trade can be the following:

Import bans

General or product-specific quotas

Rules of Origin

Quality conditions imposed by the

importing country on the exporting

countries

Sanitary and phytosanitary conditions

Packaging conditions

Labeling conditions

Product standards

Complex regulatory environment

Determination of eligibility of an

exporting country by the importing

country

Determination of eligibility of an

exporting establishment (firm, company)

by the importing country.

Additional trade documents like

Certificate of Origin, Certificate of

Authenticity etc.

Occupational safety and health regulation

Employment law

Import licenses

State subsidies, procurement, trading, state ownership

Export subsidies

Fixation of a minimum import price

Product classification

Quota shares

Foreign exchange market controls and multiplicity

Inadequate infrastructure

"Buy national" policy

Over-valued currency

Intellectual property laws (patents, copyrights)

Restrictive licenses

Seasonal import regimes

Corrupt and/or lengthy customs procedure

Notification Regime States must notify the WTO Secretariat

Why are custom duties preferred over

quantitative restrictions?

Tariffs are more transparent

Price increases with tariffs go to government but with

quantitative restrictions they go to importers (‘quota

rent’)

Open to less corruption in the setting

They do not impose absolute limits on trade

What is a tariff quota? Is it a quantitative

restriction?

Relation to non-discrimination

Non-discrimination at the core?

Additional elements Quantitative restrictions (border measures?)

Customs formalities (border measures, not in focus)

Market access – unnecessary trade barriers

Market access – harmonization of technical regulations and standards

The range of domestic measures covered The issue of «attribution»

The role of external actors and additional commitments

Quantitative restrictions Elimination of quantitative restrictions – GATT

Art. XI Equally applicable to import and export Broad range of measures

Minimum import and export prices Restrictions on points of entry

Non-mandatory measures covered

Also indirect («de facto»)

The special issue of «sensitive» products Primary products – extending to fish, textiles

Art. XIII: Non-discrimination, distribution

Scope of the TBT

Agreement Relationship to GATT, the SPS and GP

Agreements (art. 1.4 and 1.5) Technical regulations (Annex)

«Mandatory»

Standards Voluntary, but de facto mandatory(?) National

standards vs. international standards

Conformity assessment procedures Processes and production methods

Non-product-related, an issue of scope?

Which actors? Non-governmental?

Non-discrimination, art.

2.1 Note: only very recent case law!

Same as GATT Arts. I and III?

«Like products»? Too early to tell?

«Treatment no less favourable»?

The fact that GATT Art. XX is not available

Preamble to the TBT Agreement

Legitimate distinction

Even-handedness

Unnecessary obstacle,

art. 2.2 Applies also to standards (Annex 3.E) and

conformity assessment (art. 5.1.2)

Why has it not yet been applied?

Complex provision

1. Trade restrictive – how restrictive?

2. Legitimate objective – which objectives? Link to measure

3. Not more trade restrictive than necessary to achieve objective + risk of non-fulfilment

Harmonization, art. 2.4 Pros and cons of harmonization Applies also to standards (Annex 3.F) and conformity

assessment (art. 5.4) Which standardizing bodies? Open-ended?

ISO and IEC + SPS Agreement bodies Openness and recognition

Which standards State consent/majority decisions? Performance (art. 2.8)

Used as basis – shifting burden of proof The presumption art. 2.5.

Effectiveness and appropriateness of standard

Harmonization –

equivalence Particularly sensitive under the SPS Agreement

Conformity assessment procedures

Accept conformity assessments conducted elsewhere (art. 6)

Negotiations (art. 2.7)

Bilateral vs. multilateral

The vulnerability of developing countries