Basic Glossary of Terms Commonly Used in the World Trade Organization (WTO)

Basic glossary of terms commonly used in the World Trade Organization (WTO)

This glossary forms part of the series of A notes that the Center for Strategic Analysis for Agriculture (CAESPA) of the Inter- Ad valorem equivalent (AVE): WTO Def. American Institute for Cooperation on An ad valorem tariff is the price or value Agriculture (IICA) publishes regularly on expressed as a percentage. A tariff that is subjects of interest, for Institute staff and the general public. not a percentage (expressed, for example, in USD per ton) can be estimated as a The objective of this note is to contribute to the general knowledge available and clarify percentage of the price – its ad valorem the meaning of some of the trade jargon equivalent. See Ad valorem tariff. most commonly used in the WTO. Ad valorem tariff: Int. Trade Def. Tariff rate The main sources of information on which charged as a percentage of the total value or the authors drew were hard copies and price of the quantity imported. // Specific electronic versions of documents of the tariff: Customs tax charged per unit or WTO, IICA, the ITC, FAO, WHO, and quantity imported and expressed in monetary other organizations. terms; for example, USD100 per ton.

The Center for Strategic Analysis Agricultural product: WTO Def. Defined for Agriculture (CAESPA) and the WTO- for the coverage of the WTO’s Agriculture IICA Regional Reference Center wish to Agreement, by the agreement’s Annex 1. stress that this glossary contains only a This excludes, for example, fish and forestry selection of terms; it is not meant to be an products. It also includes various degrees of exhaustive compilation. It should also be processing for different commodities. noted that the terms listed often have particular nuances for the abovementioned Anti-dumping: WTO Def. Corrective organizations. measure to repair trade imbalances caused The glossary’s authors accept responsibility by unfair trade practices. See Dumping, for any unintentional errors, and Anti-dumping duties, Corrective measures, wish to express their appreciation to the Unfair trade practices. individuals who helped to improve this document; any further contributions would Anti-dumping duties: WTO Def. Measures also be welcome. taken to compensate for or correct the injury

Prepared by Adriana Campos Azofeifa, Specialist in Policies and Trade Negotiations and Coordinator of the WTO Regional Reference Centre and Nadia Monge Hernández, Assistant of the WTO Regional Reference Centre. February 2012. San José, Costa Rica

caused to producers in the importing assume formally with the organization with country by imports deemed to be dumped. If respect to tariff caps, the reduction of it is demonstrated that the dumping is subsidies, and the acceptance of multilateral detrimental, Article VI of the GATT allows trade standards. // Tariff binding: anti-dumping duties to be imposed. See Commitment not to increase a rate of duty Corrective measures, Anti-dumping. beyond an agreed level. Once a rate of duty is bound, it may not be raised without Appellation of origin: WIPO Def. Special compensating the affected parties. See type of geographical indication used on Bound tariff (bound rates, tariff binding). products that have a specific quality or characteristics that are due, exclusively or Bound tariff (bound rates, bound tariff essentially, to the geographical environment level, tariff binding): WTO Def. Maximum in which they are produced. In the case of tax that can be levied on imports based on a agricultural products, it can function as a bound tariff level. The bound tariff is the sort of “trademark” or “patent,” the highest customs duty that can be charged on difference being that it can be used by all products imported from the territory of producers who manufacture their products in another Member. Each Member is the place designated by national laws. Such responsible for negotiating its bound tariff products must share the characteristics levels. A bound tariff may differ from the attributable to their place of origin, and applied tariff, since Members may charge a specific quality and safety standards. The tariff below the maximum bound rate. But if WIPO administers the systems for the a rate higher than the bound tariff is international registration of appellations of charged, the affected parties must be origin. See Geographical indication, compensated. See also Binding concessions Country of origin, World Intellectual and Concessions (Schedule of). Property Organization (WIPO). Box: WTO Def. In agriculture, a category of Applied tariff (applied rates): WTO Def. domestic support. // Green box: domestic Duties that are actually charged on imports. support not linked to production or price They can be below the bound rates of the levels. They are permitted because they do Schedules of concessions of the Members not distort trade. // Blue box: domestic of the WTO. support permitted subject to production and price levels, but which lead producers to B limit production in order to reduce the distortions that such measures can cause. Bilateral trade agreement: Int. Rel. Def. They are allowed provided that production is Binding legal contract signed by two limited or other conditions are established countries, two states, or two economic that reduce the effects of trade distortion. // and/or political regions in order to regulate Amber box: Domestic support associated and facilitate trade between them. Such directly with production levels, to maintain agreements may be reciprocal or non- international prices. They are subject to reciprocal. reduction commitments as they are considered to distort trade. Binding of commitments: WTO Def. Series There are exemptions for developing of commitments that the Member countries countries

(sometimes called “special and differential of the WTO’s Council for Trade in Goods treatment”). See Domestic support. that provides follow-up to the Agreement on Sanitary and Phytosanitary Measures Branch of national production: WTO Def. (SPS) of the GATT/94, fields inquiries and Group of producers of the goods in direct deals with disputes in this area, and competition with or similar to the goods spearheads the process of international within the territory of a Member; may also harmonization of sanitary and refer to producers whose joint production phytosanitary standards. accounts for a significant proportion of total domestic production of the products in Common Agricultural Policy (CAP): Int. question. Rel. Def. System of the European Union (EU) that covers production objectives and C marketing mechanisms. It is intended to provide a framework for trade in agricultural Certificate of origin: Int. Trade Def. products within the European Union and Document prepared by the producer or between the European Union and the rest of exporter attesting that the goods originated the world. in the country concerned. See Rules of origin, Country of origin. Common market: Int. Rel. Def. Calls for Circumvention: WTO Def. Getting around the existence of a customs’ union, the commitments in the WTO, such as liberalization of the factors of production commitments to limit agricultural export and the liberalization of goods, people, subsidies. Includes avoiding quotas and services and capital. Refers to the absence of other restrictions by altering the country of obstacles to entry and exit and within each origin of a product; and measures taken by Member State of the Common Market. exporters to evade anti-dumping or countervailing duties. Competent health authority: Int. Trade Def. Government agency in charge of Codex Alimentarius: FAO/WHO monitoring and guaranteeing the quality of commission that deals with international health in all health-related issues of the food safety standards. See Sanitary and inhabitants of a country or region. Phytosanitary Measures, FAO, and WHO. Concessions (Schedule of): List of bound Committee on Agriculture: WTO Def. tariff rates. Body of the WTO’s Council for Trade in Corrective measure (trade defense Goods that provides follow-up to the measure): WTO Def. Measure that WTO Agreement on Agriculture of the GATT/94, Members can take to prevent or offset the studies the progress made with injury caused to the branches of domestic commitments, closely monitors ministerial production of another Member by a decisions related to net food importing least country’s unfair trade practices (dumping developed and developing countries, and and prohibited subsidies) or other trade handles agricultural trade disputes. measures. Corrective measures are antidumping, countervailing, and Committee on Sanitary and safeguard measures, and subsidies. Phytosanitary Measures: WTO Def. Body

Countervailing measure: WTO Def. A type Customs tariff (Customs duty): Int. Trade of corrective measure. Action taken by an Def. Structured list containing descriptions of importing country on a specific product to products and their corresponding customs offset the effects of subsidies given to duties. Governments establish this list by law producers or exporters in the exporting according to their national needs and country that injure a branch of production international commitments. See Customs, of the importing country. Normally, this Tariff, Applied tariff, Bound tariff, WCO, takes the form of increased duties (tariffs or Tariff heading, Harmonized system. taxes). See Corrective measures, Trade policy. Customs taxes: Int. Trade Def. Fees that a country charges for customs operations. Country of origin: Int. Trade Def. The Also known as “other customs charges.” See country of origin of a product (service or Customs and Customs duty. investment) is the place from which it was obtained in its totality, or where its last Customs territory: Int. Rel. Def. Territory substantial transformation took place (if in which the customs law of a state applies. several countries have been involved in the // WTO Def. Any territory where the WTO production or transformation process). See Agreement applies. For the WTO, all Rules of origin, Geographical indication, Members or countries are customs Appellation of origin. territories. // Int. Trade Def. Any territory that applies different tariffs or other trade Customs: Int. Trade Def. Public service that regulations to a substantial part of its trade regulates and controls the entry and exit of with other territories. // WTO Def. Separate goods, the means used to transport them, and customs territory: Any state or customs the formalities involved. Its role is to enforce territory possessing full autonomy in the the laws and collect the taxes and duties that conduct of its exterior commercial relations, apply in international trade. // Gen. Def. Place e.g., Chinese Taipei, which comprises the where goods are kept temporarily when in Separate Customs Territories of Taiwan, transit from one country to another. The Penghu, Kinmen and Matsu, is a full value of goods is calculated, and the duties Member of the WTO. and taxes payable on them are applied and collected. Customs union: Int. Rel. Def. Merger of two or more customs territories. The Customs duty (or duty rates): Int. Trade members agree to apply the same customs Def. Amount established in the customs duties (common external tariff) and trade tariffs that goods must pay upon entering or regulations to territories outside of the exiting the customs territory. Governments Union. At the same time, they agree to usually apply this measure to protect eliminate such measures for trade between their national producers against foreign members of the Union. competitors (imports).They might also apply a tariff to exports in order to protect Customs valuation: WTO Def. A customs national consumers from scarcity. See procedure applied to determine the customs Tariff, Customs tariff, Applied Tariff, Bound value of imported goods. If the rate of duty Tariff, Customs, Duty. is ad valorem, the customs value is essential

to determine the duty to be paid on an goods are exported at a price lower than the imported good. normal price or even less than the cost of production in the country of origin). See Customs value: WTO Def. The customs Antidumping and Corrective measures. value of imported goods shall be, mainly, the transaction value, that is, the price Duty, duties: Int. Trade Def. Custom actually paid for the goods when sold for duties (tariffs) and any other type of fiscal, export to the country of importation. It is monetary, or exchange costs that based on the price agreed upon price for the affect goods. A charge that a government goods when they are sold. imposes on the profits or income that a good or service can generate for the person who D provides it. A(n import) tariff is a duty imposed on foreign products for sale in the De minimis: WTO Def. Minimal amounts of domestic market (imports) that will generate domestic support that are allowed even profits for foreign suppliers. Custom duties though they distort trade. See Boxes. are the revenue that governments collect from tariffs in order to invest in Demand: Int. Trade Def. Amount of goods developmental works. or services that buyers or consumers attempt to purchase in the market. E

Distortion: Int. Trade Def. Situation in Economic integration: Int. Rel. Def. which price and production levels are higher Harmonization and unification of the or lower than those that would normally economic policies of a group, usually of exist in a competitive market. States, that share a supranational institutional structure whose directives are Domestic Support: WTO Def. In binding. Before that stage is reached, agriculture, any domestic subsidy or other normally there have been several degrees of measure which acts to maintain producer economic integration. See Free Trade Area, prices at levels above those prevailing in Customs Union, Common Market. international trade. For example, the direct payments that a Government makes to Equivalence: WTO Def. In sanitary and producers, including deficiency payments, phytosanitary measures (SPS). as well as input and marketing cost Governments must recognize other reduction measures available only for countries’ sanitary or phytosanitary agricultural production. The Agreement on measures as equivalent, even if they are different from their own, so long as an Agriculture establishes two categories of equivalent level of protection is provided. domestic support: i) support that causes little or no trade distortion, and ii) support that Exemption: WTO Def. Authorization distorts trade. See Boxes, Subsidy. granted by the Members of the WTO releasing another member country from its Dumping: WTO Def. Dumping is a normal commitments. Exemptions are for discriminatory practice that occurs when specific time frames and any extension must be justified.

Export: Int. Trade Def. Good or service food to maintain a healthy and active life.” sold to a country other than the one in which Commonly, the concept of food security is it was produced. defined as including both physical and economic access to food that meets people's Export quota: Int. Trade Def. Restriction or dietary needs as well as their food maximum limit that a country sets on the preferences. See FAO. value or volume of sales of given export products (exports). Usually done to protect Free trade area: Int. Rel. Def. When two or local producers and consumers from more customs territories eliminate the tariff temporary shortages of certain materials, or and non-tariff barriers to the commercial to influence the world prices of specific exports and imports of goods originating in materials or products. The WTO prohibits the members (countries) of the area. this mechanism. See Trade barriers, Quota. Members set their own tariffs on imports from territories that do not belong to the F area.

FAO. FAO Def. Food and Agriculture G Organization of the United Nations (UN). Agency, whose objective is to “achieve food GATT (General Agreement on Tariffs security for everyone and ensure that people and Trade): Superseded by the have access to good-quality food at all times WTO as the international organization that enables them to live an active and governing international trade. The updated healthy life.” Its mandate is to raise levels of General Agreement is now the WTO nutrition, improve agricultural productivity, Agreement governing trade in goods. // better the lives of rural populations, and GATT contribute to the growth of the world 1947: the official legal term for the old (pre- economy. 1994) version of the General Agreement. // GATT 1994: the official legal term for the Food safety: Assurance that foodstuffs will new version of the General Agreement, not cause harm to the consumer when incorporated into the WTO Agreement and prepared and/or eaten according to their including GATT 1947. intended use. It encompasses actions designed to guarantee maximum possible Geographical indication: WTO Def. Place food safety. Policies and activities for that name (or word associated with a place) used purpose must encompass the entire food to identify products (e.g., “champagne,” chain, from production to consumption. See “tequila” or “Roquefort”) that have acquired Codex Alimentarius, Sanitary and a reputation or characteristics because they Phytosanitary Measures-SPS. come from that place. // WIPO Def. Sign used on goods or services that have a Food security: 1996 World Food Summit specific geographical origin, whose qualities Def. When the nutritional needs of a country or reputation are attributable to that origin. or a population are met in a systematic Usually consists of the name of the place of manner, or “when all people at all times origin. See Geographical denomination, have access to sufficient, safe, nutritious Country of origin.

Goods: Int. Trade Def. Products or quota, Trade policy, Quantitative merchandise consumed directly, or used in restrictions, Import restrictions. the production of other goods. See Merchandise Importation: Int. Trade Def. When a country purchases goods or services H produced abroad for its domestic consumption. Harmonized Commodity Description and Coding System (HS): Int. Trade Def. An (Serious) Injury: WTO Def. Significant international nomenclature for the overall impairment in the position of a description, classification, and coding of branch of domestic production. // Threat of commodities, established and (serious) injury: imminent deterioration in developed/administered by the WCO. The the position of a branch of production; a system covers all the goods that are traded determination of the existence of a threat and is arranged in six-digit codes. Beyond must be based on facts and not on short-term the six-digit level, Members are free to arguments or remote possibility. introduce national distinctions for tariffs and many other purposes. The Members of the Intellectual property rights: Int. Trade WTO use it to identify the products in their Def. Ownership of literary and artistic concessions, and also for tariff negotiations. works, inventions, signs for distributing See Customs tariff, World Customs goods of an enterprise (brand names or Organization (WCO), Tariff heading. trademarks) and other elements of industrial property, such as appellations of origin. See I World Intellectual Property Organization (WIPO). Import license: Int. Trade Def. Official document that authorizes an economic agent M to import goods. It may establish the quantity authorized and the country of origin Market access: Int. Trade Def. Condition of the goods to be imported. It is used as an that determines whether the suppliers of instrument for regulating and supervising goods and services of a country have a real the flow of imports. See Non-tariff barriers, possibility of competing with imported Quotas, Import quotas, Trade policy. goods, or of penetrating a foreign market. //

Import quota: Int. Trade Def. Restriction, WTO Def. Conditions, tariff and non-tariff limit, or cap (in value or quantity) that a measures, agreed by Members of the WTO country sets on goods that it purchases abroad. If the volume or price exceeds the for the entry (importation) of specific goods limit, the goods cannot be imported. The into their markets under non- discriminatory WTO prohibits this mechanism. conditions. See Most-favored nation, See Trade barriers, Quotas. National treatment.

Import restrictions: Int. Trade Def. Tariff Market: Econ. Refers to the set of and not-tariff measures that a country transactions involved in the purchase and imposes to limit the entry (importation) of sale of goods and services, and to the foreign goods. See Trade barriers, Import environment in which buyers and sellers of

goods and services conduct such Countries with which it has no preferential transactions; the transactions are defined treatment arrangement. Excludes based on the relationship between the supply preferential tariffs under free trade and the demand. Geographically speaking, it agreements and other schemes or tariffs may be local, national, regional, etc. charged inside quotas.

Member (of the WTO): WTO Def. Multifunctionality: WTO Def. Idea that Governments that sign the WTO Agreement agriculture has many functions in addition to voluntarily (see GATT). Members are producing food and fiber, e.g. environmental countries or customs areas with full rights protection, landscape preservation, rural to vote, formulate proposals, and make employment, food security, etc. See Non- decisions. // Observer member: There are trade concerns. two types: governments and international organizations. Governments are observers Multilateral agreement: Int. Rel. Def. after they express an interest or desire to Binding agreement or contract involving participate, and until they become full several countries. // WTO Def. At the WTO, Members. During that period, they may this term designates agreements or contracts speak during meetings but are not permitted that apply to all Members. Not the same as to vote or submit proposals. International a “plurilateral agreement.” See organizations (like IICA) may be Observer Plurilateral agreement. Members when they are interested directly in trade policy matters or responsibilities Multilateral trading system (MTS): Int. related to the WTO. They are granted Rel. Def. Non-discriminatory agreement for membership of specific WTO bodies, as international trade that began to operate with occurred with IICA in the case of the the GATT in 1947. Currently represented Committee on Agriculture and the SPS by the WTO, it is the set of agreements, Committee, where they may be invited to standards, principles, rules, parameters, and observe the deliberations on specific issues institutions that the Member Governments or take the floor in meetings. This does not have agreed to establish to regulate and include the right to distribute documents or facilitate trade. The international trade formulate proposals, unless invited to do so; regime applies to all Members. See WTO or to take part in decision-making. Agreement, GATT, Multilateral Agreement, WTO. Merchandise: Int. Trade Def. Any tangible item of monetary value that can be bought or N sold. National treatment: Principle that is binding upon all Members. Imports of MFN (most-favored-nation treatment): foreign goods and services must be treated WTO Def. Principle of not discriminating no less favorably than the same domestically between one’s trading partners. See also produced goods. That is, no Member may MFN tariff, Trade policy. create conditions that discriminate against foreign production or that favor domestic Most-favored-nation (MFN) tariff: WTO over foreign production. See WTO Def. Normal non-discriminatory tariff that a Agreement, Multilateral agreement, Trade Member charges on the imports of Member policy.

Non-tariff barriers: See Trade barriers, products or services that are offered in the Quota, Non-tariff measures (Technical market. barriers to trade), Trade policy. P Non-tariff measures (technical barriers to the trade-TBTs, non-tariff barriers- Phytosanitary [plant health] certificate: NTBs): WTO Def. Technical regulations, Int. Trade Def. Document issued by the standards, testing and certification sanitary (or corresponding) authorities of procedures that call for requirements that the country from which the product could obstruct trade, for example, originates, certifying that the plant material requirements with regard to the labeling or inspected is considered to be pest-free. It is packaging of products. / Non-tax based on the model recommended by the restrictions that limit imports. The International Plant Protection Convention. requirements may be of an administrative or See Sanitary and Phytosanitary Measures, technical nature, e.g., quotas, import Codex Alimentarius licensing systems, sanitary regulations, and import prohibitions, among others. The Pillars (three): WTO Def. The main areas TBT Agreement is intended to ensure covered by the agriculture negotiations: transparency in the application of standards, export competition (export subsidies and to avoid unnecessary measures and ensure related issues), domestic support, and that international trade flows more market access. smoothly. See Trade barriers, Non-tariff barriers, Sanitary and Phytosanitary Plurilateral agreement: WTO Def. Measures, Trade policy. Agreement involving a very small number of WTO Members. There were four plurilateral Non-trade concerns: WTO Def. Similar to agreements–trade in civil aircraft, multifunctionality. The preamble of the government procurement, dairy products, and Agriculture Agreement specifies food bovine meat–but the last two expired in 1997. security and environmental protection as examples. Also cited by Members are rural Preference: Int. Trade Def. Advantage that development and employment, and poverty benefits the products of a country negotiated alleviation. in a specific agreement. // Int. Rel. Def. Advantages in the exchange of goods or Notification: WTO Def. A transparency services that a country grants to its trading obligation requiring Member governments partners to promote the growth of its exports to report trade measures to the relevant and the development of mutual trade WTO body if the measures might have an relations. Many countries confer non- effect on other Members. reciprocal preferences on developing countries in order to promote imports and O promote economic development projects. See Preferential tariff, Reciprocity. Offer: WTO Def. In a negotiation, a country’s proposal for its own further Preferential agreement: WTO Def. liberalization, usually an offer to improve Agreement or contract between two or more access to its markets. // Econ. Economic parties, under which special privileges are term that refers to the quantity of granted in relation to trade or customs, or

matters of some other kind. Usually system of government, economy, currency, represents exceptions to a general rule. See culture, education, and health, among others Preference. (e.g., the European Union).

Preferential tariff (Tariff preference): Regional trade agreement (RTA): Int. Rel. Tariffs lower than those that a country Def. Contracts between two or more partner usually applies for the importation of a countries (usually in the same geographical good, granted to one or more countries when area) designed to improve trade in goods and they belong to a certain geographical area, a services. // WTO Def. These free trade free trade area, a customs union or a group agreements are bilateral, either between with specific characteristics, such as countries or between blocs of countries “developing countries” and “least developed (geographical, political, and/or economic countries.” See Preference. groups).

Q Regionalization: WTO Def. Recognition that an exporting region (part of a country or Quantitative restrictions (QRs): WTO Def. a border-straddling zone) is disease-free or Limit on the quantity or value of goods that pest-free (or has a lower incidence). can be imported (or exported) during a specific time period. See Quota, Non-tariff Rules of origin: WTO Def. Laws, barriers, Trade barriers, Trade policy. regulations and administrative procedures that Members apply to determine the Quota: Int. Trade Def. Trade control country of origin of a product, service, or instrument that consists of limiting the investment. Rules of origin vary from amount of imports or exports of a specific country to country and the customs product. Import or export licenses are the authorities use them to determine whether a instruments that governments normally use good (or tariff heading) qualifies for a tariff to administer quotas. The WTO permits preference, is affected by an antidumping some quotas (e.g., tariff quotas) but not others. No Member may prohibit or restrict duty, or falls within a tariff quota, etc. See the amount or value of imports or exports. Countries of origin, Geographical See Tariff quota, Export quota, Import indication, Appellation of origin, World quota, Trade policy. Intellectual Property Organization (WIPO).

R S

Reciprocity: Int. Rel. Def. In international Safeguard: WTO Def. Emergency trade, the granting of mutual concessions. corrective mechanism used temporarily to impede imports of a product that may cause Regional integration: Int. Trade Def. injury or constitute a threat of severe injury Voluntary harmonization and to domestic production. It affords producers standardization of all the policies of the an opportunity to adjust the competitive parties or countries. The parties share a level of the product or focus their efforts on supranational government, as well as another sector of production. See Corrective common institutions for aspects such as the measure. // Special safeguard: WTO Def.

Used for the agricultural sector. A food and livelihood security and rural temporary increase in import duty to deal development. with import surges or price falls, under provisions that are special to the Agriculture Subsidy: WTO Def. An economic benefit Agreement. granted by a government, directly or indirectly, to producers of certain goods or Sanitary and Phytosanitary Measures services to strengthen their competitive (SPS): WTO-FAO Def. Measures related to position. Some economic support measures food safety and animal and plant health. // (export subsidies and local content Sanitary measures: related to human and subsidies) are prohibited because they animal health. // Phytosanitary measures: distort trade, while others must include a related to the health of plants and their commitment to reduce them. A subsidy may products. See Phytosanitary certificate, cause injury even though it is permitted. See Sanitary [animal health] certificate, Codex Domestic support, Boxes, Corrective Alimentarius, FAO, WHO. measures, Countervailing measures.

Sanitary [animal health] certificate: Int. T Trade Def. Document issued by the corresponding agencies (sanitary or Tariff: Int. Trade Def. Tax or corresponding authorities) of the country duty levied on goods transported from from which the product comes certifying one customs territory to another (often, from that it is free from contagious diseases. one country to another). Tariffs are applied to imports of goods and may also be applied Sensitive products: Intl. Trade Def. to exports. The tariff is designed to provide a Products that are vulnerable or particularly level of protection to domestic producers and susceptible to competition from imports. generate revenue for the government. The Such products usually get longer terms for price of the goods being traded always tariff reduction or elimination in trade increases when tariffs are imposed on agreements. WTO Def. Agricultural products. The list of goods and their duties products imported through tariff quotas and are established in the customs tariff. See with smaller tariff cuts to provide some Customs duty, Customs tariff, Duty. access to the market. Flexibility available Tariff barriers: See Trade barriers, Tariff for the agriculture of all the countries. measures, Trade policy.

Tariff code: Int. Trade Def. Numerical code Special and differential treatment (S&D, used to classify goods, to facilitate their SDT): WTO Def. Special treatment given to identification in international trade. developing countries in the WTO Commonly referred to as Customs tariff. Agreements. Can include longer periods to See Customs tariff and Harmonized system. phase in obligations, more lenient obligations, etc. Tariff heading: Int. Trade Def. Four-digit code into which the nomenclature of the Special products (SP): WTO Def. Products Harmonized System is divided. It is used to for which developing countries are to be classify merchandise and identify products given extra flexibility in market access for at the international level. The first digits

indicate the broader classifications of and services, and thereby facilitate trade products (i.e., edible milk). / Tariff sub- among them. heading: Digits that follow the four main digits; used to identify sub-classifications of Trade balance: Int. Trade Def. Record of a products. See Customs tariff, Harmonized country’s imports and exports during a given system, Rules of origin, World Customs period. It is the difference between the Organization (WCO). goods and services bought from and sold to other countries (exports - imports). Tariff measure (tariff barrier): Int. Trade Def. Trade barrier that consists of imposing Trade barriers: Int. Rel. Def. Trade policy taxes on imports (tariffs). A government or measures that hinder free trade among country applies a tariff or a tariff barrier to countries. They may be tariff measures protect the domestic production of imported (tariffs) or non-tariff measures. products, restrict exports, or increase fiscal revenues. See Trade barrier, Tariff, Trade Trade dispute: WTO Def. Disagreement policy, Tariff protection. between Members with respect to broken promises; that is, a quarrel that arises when a Tariff preference: Int. Trade Def. Tariff country adopts a trade policy or takes some preferences are a reduction in the duties action that one or more fellow WTO applied to imports from a specific country or Members believe violates the organization’s region. See Preferential agreement, rules or a commitment the country has Preferential tariff. made. WTO Members have agreed that, if they believe fellow-Members are violating Tariff protection: Int. Trade Def. trade rules, they will use the multilateral Protection governments grant to their system of settling disputes instead of taking domestic industries by charging a tariff on action unilaterally. imported products. See Tariff measures. Trade facilitation: WTO Def. Removal or Tariff quota: WTO Def. Refers to the reduction of obstacles to the movement of application of a lower tariff for a specific goods across borders (e.g., simplification of quantity of an imported good. When a customs procedures). country wishes to import more than that Trade flow: Int. Trade Def. Purchase and amount, it may do so but must pay a higher sale of goods and services between countries rate. The WTO allows this kind type of or regions (exports and imports). Used to quota. measure the balance of trade. Tariff reduction: Int. Trade def. Elimination or reduction of import or export Trade liberalization (free trade): Int. Trade tariffs. Def. Gradual elimination of trade barriers, such as tariffs and other import restrictions. Trade agreement: Int. Rel. Def. Legal contract (agreement, treaty, or any other Trade policy: Int. Rel. def. National binding or obligatory act) by means of framework of laws, regulations, decisions, which several States or countries voluntarily practices, and negotiating positions that agree to meet specific conditions and governments adopt to ensure that national regulations governing the exchange of goods companies have to regulate the exchange of

goods and services with a specific country Uruguay Round: WTO, Int. Rel. Def. Last or bloc of countries. The instruments that round of GATT negotiations (1986-1995), trade policies use to control the flow of which led to the adoption of the Marrakech imports and exports and the flow of capital Agreement and its annexes. For the first include tariff measures, non-tariff time, it established negotiations on measures, corrective measures, the agriculture, intellectual property, and exchange rate differential, barriers to the services. It paved the way for an equitable, movement of capital, etc. Trade policy is market-oriented system for trade in used to establish guidelines that afford agricultural products; and established producers and businesses predictability and specific, binding, commitments in relation to security. // International trade policy: market access, domestic support, and Framework of laws, regulations, and export subsidies. agreements constructed by several countries. Governments give up part of their V sovereignty in order to have a shared support that regulates and facilitates the Voluntary export restraint - VER (also interactions related to the exchange of referred to as voluntary restraint goods, services, and investments among arrangement (VRA) and orderly them. Its core components are most-favored marketing arrangement (OMA)): WTO nation treatment, national treatment, Def. Bilateral agreements whereby an transparency, and reciprocity. Governments exporting country (government or industry) regulate the exchange of goods and services, agrees to reduce or restrict exports without and provide a legal-productive framework the importing country having to make use of for companies to develop and adapt their quotas, tariffs, or other import controls. See activities within the country to such Trade policy. conditions. W Transparency: WTO Def. Degree to which trade policies and practices, and the process World Customs Organization (WCO): by which they are established, are open and Previously known as the Customs Co- predictable. See Trade policy. operation Council (CCC). It is the independent, intergovernmental agency, U based in Brussels, responsible for simplifying and rationalizing customs Unfair trade practices (unfair trade): Int. procedures. The WCO developed the Harmonized System and is the international

Trade Def. Measures that companies or governments adopt to give artificial entity in charge of administering it. See advantages to their exports and thus improve Customs, Customs duty, Tariff heading. their conditions in the international market. The principal unfair trade practices are World Health Organization (WHO): The dumping and export and production international organization of the United subsidies. Nations system responsible for health. It

establishes directives and sets health Its Members create the principal legal standards, and helps countries to address (contractual) obligations that determine the public health issues. It supports and way in which governments configure and promotes research on health. Working via apply international trade rules. It serves as a the WHO, governments can tackle global platform or forum for debate, negotiation, health problems and improve the well-being and consensus building (See Trade dispute). of their peoples. See Codex Alimentarius, See WTO Agreement, GATT. Sanitary and Phytosanitary Measures. WTO Agreement: WTO Def. Multilateral World Intellectual Property Organization agreement signed in Morocco in 1994, (WIPO): Agency of the United Nations under which the World Trade Organization system that promotes the development and was created. It is a sort of framework use of the international intellectual property agreement and includes (in the form of system (patents, copyright, trademarks, annexes) agreements related to goods, designs (drawings and models), etc.) as a services, intellectual property, dispute means of stimulating innovation and settlement, the trade policy review creativity. The WIPO is a forum that permits mechanism and the plurilateral agreements. Member States to prepare and harmonize The Schedules of commitments also form standards and practices designed to protect part of the Uruguay Round agreements. intellectual property rights; it also administers the systems for the international Z registration of marks, industrial designs and geographical indications, and an Zoosanitary [animal health] certificate: international system for the submission of Int. Trade Def. Document issued by a patent applications. competent entity (health authority) of the country of origin, attesting to the good World Trade Organization (WTO): health status of Replaced the GATT. It is the only animal goods submitted to biological tests. intergovernmental organization dealing with See Sanitary and Phytosanitary Measures, the rules governing trade between countries. Codex Alimentarius.

BIBLIOGRAPHY http://www.wipo.int/geo_indications/ en/about.html Abellán, V; Vila, B. 2005. Lecciones de http://www.wipo.int/about- derecho comunitario europeo. 4 ed. wipo/en/faq.html Barcelona, Spain. Editorial Ariel. pp. 236-238. WTO (World Trade Organization). 2010. Understanding the WTO. 4 ed. FAO (Food and Agriculture Organization of Geneva, Switzerland. WTO. p. 9. the United Nations). 2012. Websites consulted: 2012. Agreement on Subsidies and http://www.fao.org/cfs/cfs-home/en/ Countervailing Measures: http://www.fao.org/docrep/003/X735 http://www.wto.org/english/docs_e/le 2E/X7352E00.HTM gal_e/24-scm_01_e.htm

Galván, J. ; Araya G. 2004. Acuerdos de ___ 2012. Tariffs. Tariff analysis online Libre Comercio de los Países (TAO) of the WTO. Available at: Centroamericanos. San Jose, Costa Rica. http://www.wto.org/english/tratop_e/t IICA Print shop. ariffs_e/tao_help_e.htm

Goode, W. 2003. Dictionary of Trade Policy. ____ 2012. WTO Glossary of terms. 4 ed. United Kingdom, Available at: WTO/Cambridge University Press. http://wto.org/english/thewto_e/gloss IICA (Inter-American Institute for ary_e/glossary_e.htm Cooperation on Agriculture). 1997. Glosario de términos del comercio agroalimentario. Lima, Peru. WTO E-Learning. Online courses. 2012: Agreement on Subsidies and ITC (International Trade Centre). 2012. Countervailing Measures: Sites consulted: https://etraining.wto.org/admin/files/ http://www.intracen.org Course_246/CourseContents/TR-R2-E- http://legacy.intracen.org/tfs/docs/glossary/ Print.pdf

Sepúlveda, C. 2004. Diccionario de términos The WTO multilateral trade económicos. Santiago, Chile. agreements Editorial Universitaria. p.126 http://etraining.wto.org/admin/files/C ourse_313/CourseContents/MTA-E- WHO (World Health Organization). 2012. R3-Print.pdf

http://www.who.int/about/brochure_e Agriculture in the WTO: n.pdf http://etraining.wto.org/admin/files/C ourse_324/CourseContents/AG-R2- WIPO (World Intellectual Property E-Print.pdf Organization). 2012.