The document discusses regulations of the World Trade Organization (WTO) and non-tariff barriers. It provides information on the structure and functions of the WTO, including that it has 164 member countries, aims to ensure trade flows freely, and resolves disputes. Non-tariff barriers are then examined, which can include quotas, licenses, embargoes, and sanctions that restrict imports but are not tariffs. Specific examples like New Zealand's apples being banned in Australia due to pest concerns are provided. In summary, while tariffs have decreased, non-tariff barriers remain a concern and can disproportionately impact developing countries and certain sectors like agriculture.

1. WTO REGULATIONS AND NON-
TARIFF BARRIERS
Presented By: Manish Joshi
Department of Entomology, SDAU, SK Nagar (Gujarat)
Submitted To: Dr. D. S. Patel (Prof.& Head)
Department of Plant Pathology, SDAU, SK Nagar (Gujarat)

3. The WTO
• Location: Geneva, Switzerland
• Established: 1 January 1995
• Created by: Uruguay Round negotiations (1986-94) Membership: The WTO has
164 members and 23 observer governments. Liberia became the 163rd member on 14
July 2016, and Afghanistan became the 164th member on 29 July 2016.
• Budget: 197.2 million Swiss francs (approx. 209 million US$) in 2018
• Secretariat staff: 640
• Head: Director-General, Roberto Azevedo
• Functions:
 Administering WTO trade agreements
 Forum for trade negotiations
 Handling trade disputes
 Monitoring national trade policies
 Technical assistance and training for developing countries
 Cooperation with other international organizations

4. STRUCTURE
 The WTO has 153 members, accounting for almost 95% of world trade.
 Around 30 others are negotiating membership.
 Decisions are made by the entire membership. This is typically by consensus. A majority vote
is also possible but it has never been used in the WTO, and was extremely rare under the
WTO’s predecessor, the General Agreement on Tariffs and Trade (GATT).
 The WTO’s agreements have been ratified in all members’ parliaments.
 The WTO’s top level decision-making body is the Ministerial Conference, which meets at
least once every two years.
 Below this is the General Council (normally ambassadors and heads of delegation in Geneva
but sometimes officials sent from members’ capitals) which meets several times a year in
the Geneva headquarters. The General Council also meets as the Trade Policy Review Body
and also as dispute settlement body.
 At the next level, the Goods Council, Services Council and Intellectual Property (TRIPS)
Council report to the General Council.
 Numerous specialized committees, working groups and working parties deal with the
individual agreements and other areas such as the environment, development, membership
applications and regional trade agreements.

5. SECRETARIAT
• The WTO Secretariat, based in Geneva, has around 640 staff and is
headed by a Director General. It does not have branch offices
outside Geneva. Since decisions are taken by the Members
themselves, the Secretariat does not have the decision-making
role that other international bureaucracy are given.
• The Secretariat’s main duties are to provide technical support for
the various councils, committees and the ministerial conferences,
to provide technical assistance for developing countries, to analyze
world trade, and to explain WTO affairs to the public and media.
• The Secretariat also provides some form of legal assistance in the
dispute settlement process and advises governments wishing to
become members of the WTO. The annual budget is roughly 197.2
million Swiss francs.

6. • ......In brief, the World Trade Organization (WTO) is the only
international organization dealing with global rules of trade
between nations. Its main function is to ensure that trade flows
as smoothly, predictably and freely as possible.
• The result is assurance. Consumers and producers know that they
can enjoy secure supplies and greater choice of the finished
products, components, raw materials and services that they use.
Producers and exporters know that foreign markets will remain
open to them.
• The result is also a more prosperous, peaceful and accountable
economic world. Decisions in the WTO are typically taken by
consensus among all member countries and they are ratified by
members’ parliaments.
• The goal is to improve the welfare of the people of the member
countries.

7. • Trade friction is channelled into the WTO’s dispute settlement process
where the focus is on interpreting agreements and commitments, and how
to ensure that countries’ trade policies conform with them. That way, the
risk of disputes spilling over into political or military conflict is reduced.
• By lowering trade barriers, the WTO’s system also breaks down other
barriers between peoples and nations.
• At the heart of the system – known as the multilateral trading system – are
the WTO’s agreements, negotiated and signed by a large majority of the
world’s trading nations, and ratified in their parliaments. These agreements
are the legal ground-rules for international commerce. Essentially, they are
contracts, guaranteeing member countries important trade rights. They also
bind governments to keep their trade policies within agreed limits to
everybody’s benefit.
• The agreements were negotiated and signed by governments. But their
purpose is to help producers of goods and services, exporters, and
importers conduct their business.

8. Trade Barrier
• Trade barriers are restrictions imposed on the movement of
goods between countries (import and export).
• The major purpose of trade barriers is to promote domestic
goods than exported goods, and there by safeguard the
domestic industries.
• Trade barriers can be broadly divided into tariff barriers and
non tariff barriers.

9. Tariffs
 Tariffs are the simplest and oldest form of trade policy instrument. Traditionally,
they were used as a source of government revenue but they are mostly used today
to protect particular home sectors from international competition by artificially
increasing the domestic price of the imported good.
 Term tariff means ‘Tax’ or ‘duty’.
 Tariff barriers are the ‘tax barriers’ or the ‘monetary barriers’ imposed on
internationally traded goods when they cross the national borders.

10. Tariff Barriers

11. Specific duty
It is based on the physical characteristics of the good. A fixed amount of money can
be levied on each unit of imported goods regardless of its price.
Eg. Imposing of $15 on an imported shoe.
Ad Valorem tariffs
The Latin phrase ‘ad valorem’ means “according to the value”. This tax is flexible and
depends upon the value or the price of the commodity.
Eg. Imposing tax of 5$ for a 50$ shoe and 10$ for a 100$ shoe.
Combined or compound duty
It is a combination of specific and ad valorem duty on a single product, for instance ,
there can be a combined duty when 10% of value(ad valorem) and 1$ per
kilogram(specific tax) are charged on metal M.
Sliding scale duty
The duty which varies along with the price of the commodity is known as sliding scale
duty or seasonal duties. These duties are confined to agricultural products, as their
prices frequently vary because of natural and other factors.

12. Countervailing duty
It is imposed on certain import where it is being subsidized by exporting governments. As a
result of the government subsidy, imports become more cheaper than domestic goods, to nullify
the effect of subsidy, this duty is imposed in addition to normal duties.
Revenue tariff
A tariff which is designed to provide revenue or income to the home government is known as
revenue tariff. Generally this tariff is imposed with a view of earning revenue by imposing duty
on consumer goods, particularly on luxury goods whose demand from the rich is inelastic.
Anti –dumping duty
At times exporters attempt to capture foreign markets by selling goods at rock-bottom prices,
such practice is called dumping. As a result of dumping, domestic industries find it difficult to
compete with imported goods. To offset anti-dumping effects, duties are levied in addition to
normal duties.
Protective tariff
In order to protect domestic industries from stiff competition of imported goods, protective
tariff is levied on imports. Normally a very high duty is imposed, so as to either discourage
imports or to make the imports more expensive as that of domestic products.

13. Non- Tariff barriers
• A nontariff barrier is a way to restrict trade using trade barriers in a form other
than a tariff. Nontariff barriers include quotas, embargoes, sanctions, and levies.
As part of their political or economic strategy, large developed countries frequently
use nontariff barriers to control the amount of trade they conduct with other
countries. Non-Tariff barriers are trade barriers that restrict imports but are not in
the usual form of a tariff. Some common examples are anti-dumping measures and
countervailing duties also called non-tariff barriers. Non-Tariff barriers include
macro-economic measures affecting trade. Non-Tariff barriers comes under Trade
Policy.
• Countries commonly use nontariff barriers in international trade, and they typically
base these barriers on the availability of goods and services and political alliances
with trading countries. Overall, any barrier to international trade will influence the
economy because it limits the functions of standard market trading. The lost
revenue resulting from the barrier to trade is called an economic loss.
• Countries can set various types of alternative barriers in place of standard tariffs.
Such barriers often release countries from paying added tax on imported goods
and create other barriers that have a meaningful yet different monetary impact.

14. KEY TAKEAWAYS
 A nontariff barrier is a trade restriction, such as a quota, embargo
or sanction, that countries use to further their political and
economic goals.
 Countries commonly use nontariff barriers in international trade.
 Nontariff barriers have a common basis on the availability of goods
and services and political alliances with trading countries.
 Nontariff barriers often release countries from paying added tax
on imported goods and create other barriers that have a
meaningful yet different monetary impact.
 Countries can use nontariff barriers in place of, or in conjunction
with, standard tariff barriers.

15. Major Non- Tariff Barrier

16. Licenses
Countries may use licenses to limit imported goods to specific businesses. If
a business is granted a trade license, it is permitted to import goods that
would otherwise be restricted for trade in the country.
Quotas
Countries often issue quotas for importing and exporting goods and services.
With quotas, countries agree on specified limits for products and services
allowed for importation to a country. In most cases, there are no restrictions
on importing these goods and services until a country reaches its quota,
which it can set for a specific time frame. Additionally, quotas are often used
in international trade licensing agreements.
Embargoes
Embargoes are when a country or several countries officially ban the trade of
specified goods and services with another country. Governments may take
this measure to support their specific political or economic goals.

17. Sanctions
Countries impose sanctions on other countries to limit their trade activity.
Sanctions can include increased administrative actions or additional customs
and trade procedures that slow or limit a country’s ability to trade.
Voluntary Export Restraints
Exporting countries sometimes use voluntary export restraints. Voluntary
export restraints set limits on the number of goods and services a country
can export to specified countries. These restraints are typically based on
availability and political alliances.
Standard Tariffs
Countries can use nontariff barriers in place of, or in conjunction with,
conventional tariff barriers, which are taxes that an exporting country pays to
an importing country for goods or services. Tariffs are the most common
type of trade barrier, and they increase the cost of products and services
in an importing country.

18. Real World Example
• An example of nontariff barriers, as reported by Reuters, is the round
of United Nations sanctions against North Korea and the Kim Jong Un
regime adopted in December 2017. The sanctions cut exports of
gasoline, diesel, and other refined oil products to the nation, and
they prohibit the export of industrial equipment, machinery,
transport vehicles, and industrial metals to North Korea. The barriers
are designed to put economic pressure on the nation to stop its
nuclear arms and military exercises.

19. Apples Banned - Non Tariff Barrier
New Zealand's
apples account
for a third of its
agricultural
exports but have
been banned
from Australia
since 1921 due to
fears about the
spread of fire
blight, a crop
pest.

20. Summary
 Although tariffs have significantly reduced over the
last twenty years in global trade.
 Bigger concern is the dismantling of nontariff barriers
that restrict trade from less developed countries.
 The agricultural sector has had its high share of
discriminatory trade practices to protect inefficient
producers.
 Tariffs distort trade flows

21. THANK YOU