Uttar Pradesh Academy of Administration & Management

Lucknow
Workshop on WTO
Agreement on
Technical Barriers to Trade (TBT)
&
Non Tariff Barriers (NTB’s)
July 8th 2010
Dr. Yogesh Bandhu
Giri Institute of Development Studies
Lucknow
 What is a Trade Barrier
• -Import duties
• -Import quotas
• -Import licenses
• -Tariffs
• -Export licenses
• -Subsidies
• -Non-tariff barriers to trade
• -Voluntary Export Restraints

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 Economic Effect of Trade Barriers-
Common Arguments
• Jobs Are Destroyed by Trade
• Worker Wages Are Hurt by Trade.
• National Security Is Threatened by Trade.
• Special Industries with Unique and Substantial
Economic Potential will not mature without
Protection from Trade.
• Unfair Competition Undermines the Benefits of
Trade.

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 Non-Tariff Barriers Affecting Market Access

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 Non-Tariff Barriers Affecting Market Access

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 Non-Tariff Barriers Affecting Market Access

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 The TBT Agreement
• Technical regulations and product standards may vary from
country to country.
• Having many different regulations and standards makes life
difficult for producers and exporters.
• If regulations are set arbitrarily, they could be used as an
excuse for protectionism.
• The Agreement on Technical Barriers to Trade tries to
ensure that regulations, standards, testing and certification
procedures do not create unnecessary obstacles.
• Seeks to ensure that technical standards and regulations do
not cause unnecessary barriers to trade:
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 The WTO Agreement on TBT Covers
• Technical regulations which lay down product characteristics or their
related processes and
• production methods, with which compliance is mandatory.
• Standards, approved by a recognized body and which set out rules,
guidelines or characteristics
• for products or related processes and production methods, with
which compliance is not mandatory.
• Technical regulations and standards relate mainly to industrial goods,
raw materials and agricultural inputs.
• Measures imposed for the protection of human, animal and plant life
or health are covered by the WTO
• Agreement on the Application of SPS.

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 Definition of NTBs
• NTB are measures, other than tariffs, that are
connected with state (administrative) activity and
influence prices, quantity, structure and/or
direction of international flows of goods and
services as well as resources used to produce
these goods and services.
• Non-Tariff Barriers include all measures, other
than tariffs, that are used to protect domestic
industry and discourage imports

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 Measurement of NTBs
Frequency-Type Measures
• QRs and similar specific limitations
• Non-tariff charges and related policies
• Govt supports and other restrictive practices
• Customs and administrative procedures
• Technical barriers to trade
Price-comparison measures
Quantity-impact measures

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 NTBs in Multilateral Trade Negotiations
• In Tokyo Round, there was a comprehensive effort to
reduce trade obstacles stemming from tariffs and NTMs
• New or reinforced agreements called “codes,” were
reached on the following NTMs:
• Subsidies and countervailing duties;
• Government procurement;
• Technical standards;
• Import licensing procedures;
• Customs valuation; and
• Antidumping.

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 Invisible Barriers to Trade
• Non Transparent and cumbersome
Administrative Procedures and
Government Policies and Regulations
• Market Structure
• Institutional Factors

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 Non Tariff Barriers Indian Experience
• Lack of information
• Lack of Adequate Banking
Relations
• Application of standards
• Visa Restrictions
• Communication Problems
• Trade Logistics

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 TBT Agreement: Technical regulations
• Technical regulations and standards set out specific
characteristics of a product - such as its size, shape, design,
functions and performance, or the way it is labelled or
packaged before it is put on sale
• In certain cases, the way a product is produced can affect
these characteristics, and it may then prove more appropriate
to draft technical regulations and standards in terms of a
product's process and production methods rather than its
characteristics per se
• The TBT Agreement makes allowance for both approaches in
the way it defines technical regulations and standards

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 Key Features
• Objective - Protection of human safety or health
Protection of animal and plant life or health Protection
of the environment Prevention of deceptive practices
• National Treatment
• Shall not create unnecessary obstacles to international
trade
• Shall not be more trade restrictive than necessary
• As far as possible international standards should be
used

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 Conformity Assessment Procedures
• These are technical procedures - such as testing,
verification, inspection and certification - which
confirm that products fulfill the requirements laid
down in regulations and standards
• Exporters bear the cost, if any, of these
procedures
• Non-transparent and discriminatory conformity
assessment procedures can become effective
protectionist tools

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 Technical Barriers to Trade
WTO Agreements
• Rules for international trade being written through
various WTO Agreements
• Rules pertaining to Standards, Regulations and
Conformity Assessment for Trade in Goods are laid
down in
Agreement on Sanitary and Phyto Sanitary Measures
(SPS)
Agreement on Technical Barriers to
Trade (TBT)

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 TBT Agreement
• Applies to all products incl industrial and agricultural
products
• Voluntary standards & Technical regulations (mandatory
stds)-notification to all members
• Code of good practice for standards development
• Product requirements in terms of performance rather than
design or descriptive characteristics
• Technical regulations of local governments below central
government t to be similarly notified

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 What Measures are Subject to TBT Provisions?

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 Disciplines of the TBT Agreement
Non Discrimination

Avoidance of unnecessary
obstacles to trade

Harmonization

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 Non-Discrimination

Domestic
Market
National
Treatment
Clause Internation
al Market Most Favored
Nation
Clause

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 The Harmonization Principle
to Meet International Standard

National security Protection of animal Prevention of

requirements or plant life or health deceptive practices

Fundamental
Technological &
climatic or other Protection of the
infrastructural
geographical factors human health
problems

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 Set of Principles for International Standards

Transparency
Openness
Impartiality & Consensus
Effective & Relevance
Coherence
Development Dimension
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 TBT Agreement-Notification Conditions

The
The measure
A relevant
measure is may have a
internation
not in significant
al standard effect on
accordance
does not trade of
with the
exist other
standard
members

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 How WTO Agreements Concern My Business?
• Progressive liberalization of trade through successive
negotiations has led to lower (or zero) import duties, and thus
increased export opportunities, especially in developed
country markets.
• It has also created greater predictability of market access by
“binding” reduced (or zero) tariff rates.
• Most governments impose technical regulations or standards
on (domestic and imported) products to protect human,
animal or plant life or health, as well as the environment.
• National enquiry points, can provide information on national
laws and regulations that affect your business.
• Enquiry points are usually ministries of trade, agriculture or
national standardization institutes.
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 Responsibilities of Enquiry Point
 Dissemination & Understanding of TBT related
information
 Preparing Country’s stand on TBT Notifications
 Arranging Workshops/ Seminars for sensitizing
other relevant agencies
 Export Alert Service

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 Bureau of Indian Standards (BIS)
• The Product Certification Scheme of BIS aims at providing Third Party
Guarantee of quality, safety and reliability of products to the
ultimate customer.
• Presence of ISI certification mark known as Standard Mark on a
product is an assurance of conformity to the specifications. The
conformity is ensured by regular surveillance of the licensee's
performance by surprise inspections and testing of samples, drawn
both from the market and factory.
• Established 1947 – Indian Standards Institution (ISI) – registered as
society - Statutory status since 1987 after enactment of BIS Act 1986
• Engaged in standards formulation, certification, testing and related
activities including standards promotion & consumer education
• Representing India in ISO & IEC - participant in Codex work

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 Mandatory BIS Certification
109 Products
• Food Colours & Food Additives
• Cement
• Gas Cylinders
• Electrical Appliances
• Infant Milk Products
• Pressure Stoves
• Steel Tubes
• Miners’ Safety Equipment
• Packaged Drinking Water and Natural Mineral Water
• Thermometers

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 INDIA FOREIGN TRADE – QUALITY REGULATION
FOR IMPORTS:
 Directorate General of Foreign Trade
 Relevant Regulatory Agency
 BIS for 109 Products

FOR EXPORTS:
 Export Inspection Council for about 1000 notified
products (Food, footwear, chemicals, engineering,
leather, jute etc)

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 Operational Area
• Textiles • Electrical, electronics and
• Chemicals and Pesticides optical equipment
• Rubber and Plastic products • Automotive components
• Cement and concrete products • Agriculture, food and tobaccos
• Building materials • Black tea and beverages
• Pumping, irrigation, drainage • Packaged drinking water and
and sewage equipment Natural mineral water
• Pipes and fittings for water • Leather products
supply • Wood products
• Basic metals and fabricated • Paper and pulp products
metal products • Testing instruments
• Machinery and equipment
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 Role of BIS as Enquiry Point
Answering Enquiries
 Market Access
 Mandatory BIS Certification
 Acceptance of CE Marking
 Acceptance of IECCB Scheme
 Equivalence of Standards

Handling TBT Notifications

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 India – Regulatory Agencies
- Directorate General of Health Services PFA
– Ministry of Food Processing Industry FPO
– Department of Industrial Policy & Promotion BIS & EC Acts
– Directorate of Marketing and Inspection AGMARK
– Department of Agriculture & Cooperation Plant Quarantine
– Department of Animal Husbandry & Dairying MMPO
– Department of Legal Metrology Weights & Measures Act
– Bureau of Energy Efficiency Energy Conservation Act
– Chief Controller of Explosives Indian Explosives Act
– Directorate General of Mines Safety Coal Mines Regulations
– Ministry for Road Transport CMVR
– Central Pollution Control Board

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 Some Acts/Regulations/Control orders India
 Prevention of Food Adulteration Act 1954

 Plant Quarantine (Regulation of Import into India) Order, 2003

 Meat Food Product Order 1973/ Milk And Milk Product Order 1992

 Bureau Of Indian Standards Act, 1986/ Energy Conservation Act, 2001

 Standards On Weight And Measurement Act 1976/ AGMARK Act 1937

 Livestock Importation Act 1898 / Essential Commodities Act

 The Infant Milk Substitutes, Feeding Bottles and Infant Foods Act

 Export (Quality Control and Inspection) Act, 1963/ Indian Explosives Act

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 India -Notification Authority & Enquiry Points

Department of Commerce, Ministry of Commerce-

Notification Authority for India.

Bureau of Indian Standards –

Designated TBT Enquiry Point by Ministry of Commerce

Ministry Of Health & Ministry of Agriculture-

SPS Enquiry Points

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 Expectations from Stakeholders
Examination of TBT Notifications
Aspects to be considered:
Are these Notifications in accordance with International
Standards ?
Are the requirements trade restrictive ?
Are they stricter than International Standards than
necessary to meet the legitimate objectives of:
 Protection of human health or safety
 Animal or Plant life or health
 Environment
Are these Scientifically Justified ?

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 Responsibilities of WTO Member Countries

Participate in International Standards Setting

Be Proactive not Reactive to TBT Notifications

Project Regional Concerns

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 Thank You
yogeshacademic@gmail.com
(+91) 94151 18971

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• Controversial monetary aid program
• Structural adjustment program
• Removal of all internal subsidies
• Jamaican milk subsidies
• Common Agricultural Policy (CAP)
• Guaranteed minimum prices
• Import tariffs and quotas on products outside EU
• Conflict between US and EU
• Subsidies resulting from political/economic reasons rather
than real demand from producers
• Increasing demand for fuel-efficient, eco-friendly vehicles
• Differences in US and European safety regulations inhibiting
trade
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