Non-technical licensing - International trade in goods and services

Non-Technical Licensing

The Argentine government has expanded to 600 items the list of goods for which imports are required to obtain non-automatic licenses. The corresponding resolution (dated February 14, 2011 No. 45) was adopted by the Ministry of Industry of Argentina and entered into force on March 7, 2011. From this moment, products such as "luxury" cars, motorcycles, spare parts for cars fall under the non-automatic licensing , bicycles, textiles, paper, electrical appliances, metal products (machines, equipment).

Resolution No. 45 extends to Uraltransmash, which supplies oil production equipment (rod pump drives) to Argentina, and may hamper further advancement of this and similar equipment to the Argentine market.

With the help of licensing, the state directly intervenes in the economy of the country, which is due to the functions of licenses, which are to control foreign trade activities and use of foreign currency; political and economic pressure on any country; protection of national industry; replenishment of the country's budget.

This distinguishes general licenses issued for an unlimited number of transactions within a certain period, and one-time licenses, which represent the permission for each separate transaction. General licenses granted to a certain number of firms limit the number of exporters or importers (for example, to allow the export of goods only to its producers or allow its import only for certain purposes). In each country there are special bodies engaged in issuing licenses: the licensing committee, the department, the ministry of foreign economic relations, sometimes central banks.

The WTO agreement on import licensing procedures emphasizes that licensing should be carried out on a non-discriminatory basis for all importers and exporters, and countries should publish all rules and all information relating to licensing.

Voluntary export restriction (quantitative restriction) also applies to non-tariff methods of state regulation of foreign economic relations and means the obligation of one of the foreign trade partners to limit the volume export of certain goods. If the voluntary restriction is accepted, then the one who accepted it, undertakes to export in the amount required by the partner. So, Japan "voluntarily" limited its exports of television sets to the UK, Belgium, the Netherlands and Luxembourg, steel to the countries of the European Union, South Africa, South Korea. European Union countries voluntarily limited their exports of pipes and tubes in the United States.

The application of quantitative restrictions has brought a lot of new to the market mechanism of regulating foreign trade. On the nature of their actions, they are significantly different from customs duties, taxes and fees, the use of which is permitted art. XI GATT 1994. Customs duties and other value regulators do not establish direct norms determining the number of goods allowed for import and export, their nomenclature, do not limit the range of countries from where and where goods can be imported or exported. All this makes quantitative restrictions.

Hidden methods, for example, the government's tax policy, have a certain effect on the dynamics and structure of foreign trade. Thus, a policy of high taxes contributes to a reduction in domestic demand, which in turn inhibits development imports. The use of such tax instruments, formally not directly related to the state regulation of foreign trade activities, but which have a significant impact on it, refers to the para tariff, or quasi-tariff, regulation. And when goods cross the customs border, they can be charged not only with domestic taxes that correspond to taxes on domestic goods sold on the domestic market, but also so-called special export and import taxes. By their action, they do not differ from import and export customs duties. For example, one of the most common barriers in the CIS area is the application of differentiated rates of excise tax, when the rates of excise are applied to imported products substantially higher than for domestic products. Such application of indirect taxes is inherently a barrier equivalent to customs duty, and devalues ​​agreements on the regime of free trade. In addition, some countries in their fiscal policy do not always reasonably apply traditional means such as an additional tax discriminating against imports of a wide range of products (Moldova, Uzbekistan).

At present, the influence on trade of measures taken by states to implement environmental policy has increased. The most widely used are: environmental taxes, which, as a rule, are linked to the energy intensity of production, the carbon content in emissions to the atmosphere (if the amount of environmental tax is linked to the production process and is imposed on the imported goods, such a tax can be considered illegal); environmental subsidies and procurement rules (with this regulation, the state may make direct or indirect payments to producers that comply with environmental standards); environmental technical standards (protection of the consumer and the environment through the adoption, for example, of limits on the content of certain components); bans on trade or quarantine (most often they take the form of sanitary or phytosanitary measures); environmental labeling (encourages the consumer to purchase safer products). For example, in the Republic of Moldova an additional charge is imposed on the import of goods, in the process of using which the environment is polluted. As a result, the duty free trade regime established by bilateral obligations is offset by the introduction of a measure equivalent to the effect of customs duty. The list of goods for which the above fee is applied includes the following items: petroleum products, varnishes, paints, fertilizers, rubber and plastic products, tires, vehicles, electrical appliances. This collection is also subjected to packaging of imported products from plastic or "tetra-pack"; in the amount of 2 to 5% of the value of the products contained in it.

A special place is occupied by purchases of goods and services by the state or on behalf of the state for its own needs. Despite the fact that during the Uruguay Round the Agreement on Government Procurement (GPA) was drafted, it is one of the optional agreements of the WTO system and its participants are mostly highly developed countries. The GPA agreement contains a clearly defined list of state organizations and enterprises whose purchases are covered by the document, but there is also a reserve for preserving preferences: only those transactions that exceed a certain threshold of $ 200,000 for most contracts are regulated. At the same time, the document provides for a variety of flexible ways of estimating the cost of purchases, depending on their regularity and the structure of the transaction price. The need to sign such an agreement in 1994 was justified by the fact that public procurement accounts for 10-15% of the GDP of WTO members and discrimination in this segment has a detrimental effect on freedom of trade. Currently, the agreement has been signed by 39 WTO member countries, including the United States, the EU countries and Japan. China is negotiating a possible accession to the GPA as an observer.

The para-tariff constraints ( methods ) occupy a special place in the hidden constraints - These include, for example, payments levied (other than customs duties) when goods cross borders (VAT, excises, fees, penalties). They include: comparison of tariff classifications; comparison of customs clearance rules; the establishment of special items for the admission of specific goods; special requirements for technical parameters, requirements for labeling and packaging of goods; sanitary, medical, veterinary control and quarantine. When these measures are used, the customs clearance procedure becomes more complicated, overhead costs are increased and, consequently, the price increases and competitiveness decreases. These measures are applied mainly to the regulation of imports.

The most well-known and widely used non-tariff restrictions are anti-dumping measures, which is explained by their object orientation and effectiveness, a well-developed investigative mechanism, and also that they can be applied selectively against a particular exporter.

Dumping is a price discrimination tool used to increase sales without lowering prices in the domestic market.

Often firms use this kind of policies to drive out competing firms from the market. Dumping is not prohibited, and its application as a market strategy does not contradict the WTO rules. However, taking into account that this tactic can cause damage or there is a threat of damage to the national industry, a corresponding universal countermeasure mechanism was created within the framework of the GATT/WTO. In the WTO, the application of anti-dumping measures is governed by the Agreement on the Application of Article VI of GATT-1947. A distinctive feature is the selectivity of the action or, in other words, the use only of suppliers that resort to dumping.

There are two main ways to eliminate the adverse economic consequences of dumping: the introduction of anti-dumping duties (antidumping duties are targeted, are introduced only in relation to dumping enterprises and are levied in addition to custom duties ) and acceptance of price obligations by exporters (price obligations are obligations of exporters to refuse deliveries at dumping prices and adhere to an agreed price level).

The application to protect national anti-dumping markets in international practice has become a mechanism through which governments can pursue protectionist policies in the interests of particular sectors of industry without changing the general course of their trade policies. Anti-dumping measures can be introduced only after an investigation and for up to five years, but their effect can be extended as a result of the revision of the measure. It should be noted that the antidumping duty can also be challenged by the exporting country in the WTO Dispute Resolution Authority. Of the 447 trade disputes initiated within the WTO, 93 dealt with the Agreement on the Application of Art. VI GATT 1994, which is more than 20%.

Since the formation of the WTO until 2011, only 4010 investigations have been initiated, while 2601 anti-dumping duties have been introduced (more than a third of all investigations were terminated either due to an increase in exporters' prices or due to a lack of evidence of dumping and a decision by the investigative body not in favor of national producers). The largest number of anti-dumping duties for 1995-2011. was applied by India (458, while the USA initiated 304 anti-dumping measures, EU - 275). At the same time, China is the absolute leader in terms of the amount of anti-dumping duties applied against its exporters (there were altogether 612 anti-dumping duties). According to WTO data, between October 2012 and April 2013, Argentina, India and Brazil initiated 10, 15 and 18 anti-dumping investigations, respectively (calculation of the number of affected exporting countries), whereas Indonesia, Japan and Russia did not use such measures .

Special safeguard measures are used to restrict imports much less often, because they are less flexible and pointy. In addition, the rules of international trade recognize that this tool is not a means of eliminating unfair competition, but serves as a temporary "legal protectionism" Domestic industries that do not stand up to normal competition with increased imports. Therefore, WTO members have certain restrictions on its application, in particular, related to the need to provide tariff compensation for maintaining an equivalent level of concessions and other obligations between them and other WTO members whose exports were affected by such a measure.

The most sensitive to United States exports are the measures taken by Ukraine, where three special protective measures are currently in place and four new investigations are being carried out.

The countries of South-East Asia are active users of trade protection measures - anti-dumping and special protective ones. In this case, the objects of application of such measures are most often the products of the chemical and metallurgical industries. In addition, there has been a trend in these countries to use and other measures of non-tariff regulation of trade, which has repeatedly become a discussion of the legality of their application within the WTO. It is about the procedures for certification of metal products and licensing of its turnover on the territory of such countries.

Financial and foreign currency regulation of foreign trade grouped around two main areas: creating direct barriers to the foreign goods on the national market and increasing the competitiveness of national producers through financial and foreign exchange benefits, as well as by creating indirect, hidden barriers to foreign products.

State subsidies and financing of production and marketing of goods allow exporters, on the one hand, to enter the foreign market with goods whose prices are lower than the prices of competitors, and on the other hand, the system of subsidies and financial benefits to national producers protects the domestic market from foreign competition, erecting less visible but effective barriers, as well as those created by customs duties and quantitative restrictions. Likewise, credit and tax systems are used that allow simultaneous expansion of exports through credit and tax incentives and impose barriers to imports through tax barriers, import deposits and more expensive loans.

Defining the concept of subsidy was developed during the Uruguay Round and is included in the Agreement on Subsidies and Countervailing Measures of the WTO - the Code on Subsidies, adopted in 1993. The main objective of the Code is to create normal conditions for competition in the world market, providing direct subsidies to enterprises or industries that fulfill export orders; premiums for exports; preferential transport or freight rates; tax benefits to exporters. In addition, export subsidies are regulated by the rules of the anti-dumping procedure.

In accordance with the WTO rules (Article 1 of the Agreement on Subsidies and Countervailing Measures), the following definition is generally accepted.

Subsidy is the financial support that is provided by the government, government agency or regional authority and can be expressed in direct or indirect financial support from the government of the production or export of goods, including their transportation.

The notion of subsidy also includes the provision of goods and services by the government, as well as the acquisition of goods on preferential terms. The main feature of the subsidy is that all the above actions provide economic benefits (benefits) to the recipient of the subsidy.

In world practice, export subsidies are usually applied in the form of either full or partial exemption of exporting firms from payment of certain taxes, import duties, return of excise duties or in the form of direct export subsidies.

It should be clarified that export subsidies are prohibited in the WTO, but exceptions are allowed for agriculture. It is done for those countries that have fixed in their lists the use of export subsidies in a certain amount and the obligation to reduce them. This right is not available to all WTO members. However, at present, within the framework of a new round of WTO negotiations aimed at further improving the rules of this organization, for further liberalization of trade, it was previously agreed that by 2013 developed countries will stop using export subsidies. For developing countries, a longer grace period is envisaged, but in 2017 they will also have to abandon the use of export subsidies.

Thus, at present, non-tariff measures are used as the most effective means of protecting the national market. This trend has been particularly evident in the past two decades due to the lack of certainty in the application and the possibility of multiple or prolonged use of non-tariff barriers to the same product.


• The modern trading system is a set of mutual trade ties of all countries of the world, formed on the basis of an MRI and a set of measures of trade and political regulation, with constantly arising disagreements and contradictions that cover all WTO participants.

• International organizations (UNCITRAL, UNCTAD, etc.) play a key role in the international trading system by regulating and promoting business development by improving the national legislative framework, unifying its basic elements, adapting to new globalization processes; conducting coordinated trade and investment policies, measures to liberalize foreign trade relations.

• The WTO is gaining more and more importance in the modern world trading system, which has taken control of not only trade issues, but also a wide range of topics related to investments, public purchases, transportation, telecommunications, financial and other services. >

• RTAs are becoming an integral part of the modern multilateral trading system and facilitate the liberalization of mutual trade, with the aim of completely freeing trade ties from tariff barriers.

• One of the main ways to regulate the foreign trade of any country is the customs-tariff system, based on customs duties. In addition to customs and tariff regulation of foreign economic activity, countries use non-tariff measures. The issue of classification, comparison, quantification of non-tariff measures occupies one of the central places in the work of the WTO.

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