LEGL 4900 Test 2 Vocab

presence of natural persons

Individuals travelling to a foreign country to offer services.

negotiating rounds

Round of trade negotiations among the WTO membership.

global tariffs

Tariffs imposed on a particular classification of goods without regard to the country of origin of the goods.

normal value

The price at which a "foreign like product" is sold for consumption in the producing or exporting country in usual commercial quantities and in the ordinary course of business, and at the same level of trade—in other words, comparing wholesale sale to wholesale sale, or retail to retail—as the dumped product.

export price

The price at which a product is sold to an unaffiliated or unrelated buyer in the United States, exclusive of shipping and insurance charges.

normal trade relations

Unconditional MFN trade has been renamed by Congress to this. A legal designation for free trade with a foreign nation.

Codex Alimentarius

A collection of international standards for food production, food safety, and food.

customs union

A free trade area with a common external tariff.

most-favored-nation trading status

Agreeing to accord items imported from that country the most favorable treatment or the lowest tariff rates.

conditional MFN trade

Any trade advantage applied to an item imported into a country (such as a reduced tariff rate) will also be applied to the same or like items coming from any other country that has MFN status with the importing country, provided that country reciprocates and lowers tariff rates an equivalent amount in return.

prior approval

In "..." countries, regulated products must undergo testing and inspection by an approved laboratory, receive a certification of compliance with technical standards, and then receive prior regulatory approval before sale.

export subsidy

A prohibited subsidy made available to domestic firms upon the export of their products or made contingent on export performance.

less than fair value

A sale in which the "export price" of a product sold in the United States is less than the "normal value" of a foreign like or similar product sold for consumption in the exporter's or producer's home country.

countervailing duty (CVD duty)

A special tariff, levied in addition to the normal tariff, imposed on imports of subsidized goods for the purpose of offsetting the subsidy.

presidential proclamation

A statement or declaration of the president usually addressed to the general public announcing a finding or commemorating an event.

upstream subsidy

A subsidy bestowed on raw materials or component parts ("inputs") for use in an exported product. For instance, a subsidy on coal might also be considered a subsidy on steel made in furnaces that burn that coal. These subsidies are subject to CVD duties if the input product is made available at a below-market price and has a significant effect on lowering the cost of manufacturing the final product.

specific subsidy

A subsidy given to a select company or limited number of companies, to a select industry or group of industries, or to firms in a select geographical region of a country. These are the type prohibited by the SCM Agreement.

prohibited subsidies

A subsidy that is banned or forbidden under the rules of the World Trade Organization. Their harmful effects are presumed; no proof is necessary to show that they cause any adverse effects to a foreign country or foreign competitor because they so clearly distort international competition between firms.

tariff

A tax levied on goods by the country of importation.

free trade agreement (FTA)

A trade agreement with broader coverage that establishes a "free trade area" in which special tariff and customs provisions govern the flow of trade between the participating countries.

unfair trade practice

A trade practice that causes injury to domestic producers due to some sort of extra benefit the foreign producers have (e.g., dumping, subsidies, etc.)

design standards

Characteristics that govern how a product should be designed, seen in Japan as a form of product standard.

market access agreements

Conditions and measures set by countries on the exporters for entry of certain goods into the market.

free trade area

Consists of two or more countries that are party to a free trade agreement that reduces or eliminates tariffs on goods, removes trade barriers, and usually addresses other common concerns affecting trade between them.

beneficiary developing countries

Countries that are eligible for preferential treatment/trade preferences under the Generalized System of Preferences (GSP). GSP was enacted in 1974 and is renewed regularly by Congress.

ad valorem tariff

Customs duty is calculated as a percentage of the value of the product. Typically done with nonfungible goods (chairs, machinery, etc.)

specific or flat tariffs

Customs duty is calculated on the basis of physical units at a flat rate per unit. Typically done with fungible goods (crude oil, wheat, etc.)

domestic subsidies

Financial aids given by the government to individuals or enterprises in local market. They distort markets by causing overproduction and suppressing prices while protecting the incomes of farmers. WTO Agreement on Agriculture is where these became banned.

consumption abroad

Firms or individuals making use of a service in a foreign country.

priority foreign countries

Foreign countries that decline adequate protection of IPR. Each year, the USTR must identify and report on those ... that continue to deny adequate protection to American IPRs. A country is not placed on the list if it is making substantial progress in protecting IPRs or engaged in good faith negotiations, bilaterally or through the WTO.

prior certification

In "..."countries, regulated products need only undergo testing or inspection and certification. The testing lab's certification remains on file with the manufacturer or importer, and no regulatory approval is needed prior to import or domestic sale.

nondiscrimination

One of the basic rights of membership in the WTO; every WTO member country must treat the goods and services from all other WTO member countries equally.

multilateral trade negotiations

One of the cornerstones of the GATT system was a commitment by member countries to conduct... These sessions are called "rounds."

agricultural export subsidies

Payments or other benefits given to farmers that directly encourage, or are conditional upon, the export of food or agricultural products. WTO Agreement on Agriculture is where these became banned.

inherent powers

Powers that are expressly granted to the president in Article II, which states that "The executive Power shall be vested in a President." Not clearly specified or defined.

tariff schedules

Primary resource for determining tariff classifications for goods imported. Each country has one.

Chinese Compulsory Certification (CCC) Mark

Products that meet the quality and safety requirements for certification in China are eligible for this. China will not accept imports of covered products without the mark. Under the regulations, fines may be imposed for falsification of marks.

competitive need limitation

Quantitative limit on imports from each beneficiary country.

global quota

Quota imposed by an importing nation on a particular product regardless of its country of origin.

allocated quota

Quota in which the total limit is "allocated" among several specific countries.

absolute quota

Quotas that strictly prohibits imports of an item above a predetermined limit, based either on the value or quantity of specific goods (weight, number of pieces, etc.), or as a percentage of the domestic market for that item.

treaty power

Refers the authority of the US to enter treaties pursuant to Article II of the constitution.

trade-related aspects of intellectual property rights

Refers to government rules or regulations on intellectual proper rights (IPRs) that have a direct or indirect effect on trade in goods. Dealt with in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). TRIPS sets new, comprehensive standards for the protection of IPRs in all member countries of the WTO.

transparency

Refers to the degree to which a foreign government's import laws or regulations (including customs and import procedures, as well as technical regulations, product standards, and others) are made readily available to the public, including foreign firms.

anti-circumvention

Refers to those laws and penalties intended to discourage circumvention.

local content requirements

Regulations dictating that a foreign company or other producer must use a certain minimum percentage of locally made parts or components in the manufacture of a product. TRIMS prohibits this.

technical barriers to trade

Technical regulations and [product] standards that apply to imported foreign products, even if they also apply equally to domestic products.

zero quota

Term used to refer to a complete ban on the import of a product in that it permits zero quantities to be imported.

Import-Export Clause

The Constitution prohibits the states from taxing both imports or exports. ("No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing its inspection Laws...." Article I §10 Clause 2).

special drawing rights

The International Monetary Fund's international "reserve asset" with a value pegged to the value of a "basket" of five major currencies. The value fluctuates daily and can be obtained on the IMF's website. It gives stability to currency markets.

emergency powers

The President of the United States possesses certain powers to act in emergency situations; granted to the President by Congress.

trade compensation

The act of lowering import duties on certain products coming from a foreign country for the purpose of offsetting increased duties imposed on other products from that country.

Commerce Clause

The broadest power of the federal government to regulate business activity is derived from Article I, Section 8 of the Constitution. It vests the federal government with exclusive control over foreign commerce.

trade consultations

The first step in dealing with a potential nullification/impairment of a WTO member nation (pre-WTO dispute settlement). Meetings of customs administrations with representatives at the WTO.

factors of production

The main inputs that are used in the production of goods or services to make an economic profit.

bound rate

The maximum tariff rate a country may charge on an item, although tariff rates may be reduced below the ...

unilateralism

The policy that a nation should retaliate unilaterally against another country that discriminates against its products or firms rather than relying on an established international or multilateral framework for resolving trade disputes.

constructed value

The price of the dumped product compared to the cost of producing the product in the exporting country plus a reasonable amount for selling, packaging, administration, and other costs and for a reasonable profit.

trade liberalization

The process of reducing tariffs and removing artificial barriers and restrictions on trade.

government procurement

The purchase of goods and services by government agencies at all levels.

dumping

The selling of products in a foreign country for less than the price charged for "like" or comparable products in the exporter's or producer's home market. Banned in the original 1947 GATT Agreement

Japan Industrial Standards (JIS) Mark

The symbol of an approved product in Japan is the government-authorized... Its appearance on a product, although voluntary, indicates that the manufacturer has submitted to on-site inspections by the appropriate Japanese ministry and has met accepted standards for quality control, production techniques, and research methods.

nonmarket economy countries (NMEs)

These are countries whose political and economic systems are rooted in the socialist principles of a state-controlled economy. In AD cases involving these, it is difficult or even impossible to determine the "normal value" of merchandise sold in this type of country because of likely government manipulation of costs and prices.

dumping margin

This difference between normal value and the export price (or constructed export price) is known as the ... AD duties are calculated on merchandise in an amount equal to the ...

least restrictive trade

This principle states that WTO member countries, in setting otherwise valid restrictions on trade, shall make them no more onerous than necessary to achieve the goals for which they were imposed.

privatization

This term refers to the process by which a government sells or transfers government-owned industries or other assets to the private sector.

trade promotion authority

Trade Reform Act of 1974 set up a '"fast-track" process for approving trade agreements, known today as...

trade in services

Trade in areas that include travel, tourism, professional services, and management services.

equal dignity rule

Treaties are binding on both the federal and state governments with the same force of an act of Congress; both statutes and treaties are considered to be of equal importance. What is this rule?

presidential memorandum

Usually less formal than an executive order and often states in its text that it does not create enforceable legal rights. It is often used to give guidance or delegate routine presidential functions to lower government officials.

product standard

Usually used when referring to a voluntary guideline for product characteristics established by a recognized private or industry organization or association.

federal preemption

When a law or regulation of the federal government directly conflicts with those of the state (or local) government, the federal law will generally prevail when Congress expresses the intention that the federal law shall prevail or when that intention may be inferred from the legislation or from the circumstances.

tariff bindings

agreed tariff rates (rates become bound/capped at this rate)

auctioned quota

Quota in which a country sells the quota rights through bidding.

unitary business

An affiliated or related group of companies under common control.

quota

Quantitative restriction on imports.

market disruption

... from increased imports of foreign goods might include decreased sales volume, price suppression, lower profitability, lower wages, and other economic consequences to domestic firms.

import substitution subsidy

A (prohibited) government subsidy whose payment is contingent on its recipient using or purchasing domestically made goods over imported goods.

common market

A customs union that also removes restrictions on the free movement of money, labor, and factors of production (European Union is a good example).

negative determination

A decision by the agency either to not initiate an investigation or that a material injury does not exist.

adjustment to imports

A decision that can be made at the president's discretion if it will help the domestic industry make a positive adjustment to import competition and if it will provide greater economic and social benefits than costs.

commercial presence

A foreign entity setting up branches in another country has a what?

sanitary and phytosanitary measure

A government rule or regulation that protects or enhances food, animal, or plant safety or quality, including preventing the spread of pathogens and disease. SPS Agreement of the WTO discusses this.

technical regulation

A law or regulation affecting a product's characteristics—such as its performance, design, construction, chemical composition, materials, packaging, or labeling—that must be met before a product can be imported or sold in a country.

trade preference

A law that grants favorable trade and tariff treatment to products coming from developing countries, and is intended to aid in their economic development. Provides for a formal system of exemption from the more general rules of the World Trade Organization.

priority watch list

A list created by the USTR that helps US IPR negotiations and helps US companies identify countries where their IPRs might be in jeopardy; more concerning than a regular watch list.

watch list

A list of countries that have low priority but are still identified as potential risks. Specifically referring to the USTR's management of countries who don't adequately protect IPR, outlined in the US Trade Facilitation and Enforcement Act of 2015.

surrogate market economy

A market economy used in place of an NME to determine what the fair value of a good is for dumping.

Dispute Settlement Body

A means, provided by the WTO for member countries to resolve trade disputes rather than engage in unilateral trade sanctions or a trade war. This only occurs if trade consultations fail. Dispute resolution is binding.

trade-related investment measure

A national rule or regulation on foreign investment that has a direct or indirect effect on trade in goods. Dealt with in the WTO Agreement on Trade-Related Investment Measures (TRIMS). The agreement does not set broad rules for local investing, such as rules affecting domestic stock exchanges. It does attempt to reduce restrictions on foreign investment that might restrict cross-border trade in goods and services. It also eliminates discrimination against foreign firms and their goods and services to the extent that those restrictions distort or restrict trade.

International Organization for Standardization (ISO)

A nongovernmental organization comprising the national standards institutes of 163 countries. It has developed over 21,000 standards for goods, services, manufacturing and technology in many industries.

procurement offsets

Agreement that prohibits a procuring agency from awarding a contract to a foreign firm on the basis of certain conditions.

escape clause

Allows a party to withdraw from the agreement or to change its conditions under specified conditions. Permits a country to temporarily "escape" or be relieved from its tariff concessions under certain conditions. (Covered under Article XIX of GATT)

water's edge election

Allows multinational corporate taxpayers the option of excluding the income of related entities that are incorporated in a foreign country or that earn a majority of their income in a foreign country.

reciprocal trade

An agreement between two countries which provide for the exchange of goods between them at lower tariffs.

tariff concession

An agreement to reduce a tariff to a specified level. Each country's promise to reduce tariffs on imports of a given item in return for ... from other countries.

tariffication

An effort to convert all existing agricultural non-tariff barriers to trade (NTBs) into bound tariffs and to reduce these tariffs over time.

market-oriented exporter

An exporting firm in an NME country that is not under government control and that does business on competitive terms.

market-oriented industry

An industry in which resources (materials, energy, etc.) and labor costs are procured at free-market prices, where there is little government involvement in controlling production and capacity decisions, where prices are set by markets, and where the producers are mostly privately owned.

trade agreement

An international agreement between nations on matters related to trade and tariffs.

sole executive international agreement

An international agreement negotiated and put into legal effect without congressional approval; the president's authority to enter into one of these is based either on presidential powers inherent in being the chief executive/command-in-chief or it arises pursuant to existing legislation.

CE Mark (Conformité Européene)

An internationally recognized symbol for quality and product safety for many different types of products, such as children's toys, gas appliances, machinery, and medical and electrical equipment. Product safety standard from the European Union.

executive order

An official, legally binding regulation or written directive issued by the president, usually addressed to government officials, departments, or agencies, and used to set policy and direct government operations.

nontariff barrier

Any barrier to trade, other than a tariff, that has the effect of prohibiting or discouraging imports.

trade barrier

Any impediment to trade in goods or services.

import trade barrier

Any impediment, direct or indirect, to the entrance or sale of imported goods or services existing in the country of importation.

unconditional MFN trade

Any new lower tariff that applies to an item imported from one MFN trading partner automatically applies to the same or like items imported from all other nations that are in MFN status with the importing country, without any concession being required from those nations in return.

domestic like product

Broadly defined as "a product which is like, or ... most similar in characteristics and uses with, the article subject to an investigation" ... Relevant factors include tariff classification, physical characteristics and uses, channels of distribution, customer perceptions, and price.

subsidy

Defined in the SCM Agreement (WTO Agreement on Subsidies and Countervailing Measures) as a financial contribution, including any form of income or price support, made by a government that confers a benefit on a specific domestic enterprise or industry.

balance-of-payments

Difference in value between payments into and out of a country over a period of time.

safeguards against injury

Emergency remedies provided by law, usually tariffs, used to protect a domestic industry from injury resulting from increased imports of a like or competing products.

circumvention

Includes any attempt by an exporter or importer to unlawfully or deceptively evade import restrictions or duties, including AD/CVD duties.

material injury

Injury that is "not inconsequential, immaterial, or unimportant." In determining ..., the ITC must consider all relevant economic factors: import volume, the effect on prices for like domestic products, and the impact on the domestic industry sales/profits/market share, etc.

congressional-executive agreements

International agreements between the president, representing the United States, and a foreign country, negotiated and concluded by the president and voted into law by a simple majority vote of both the Senate and the House of Representatives. A treaty that isn't called a treaty to bypass the treaty approval process.

modification/withdrawal of a concession

It must negotiate directly with the countries most affected (those countries which are the major suppliers of that item) and by agreement reduce or offset tariffs on other items equal to an equivalent amount in trade.

trade balancing requirements

Laws that condition a company's right to import foreign goods on the basis of the volume of goods that company exports. TRIMS prohibits this.

American National Standards Institute (ANSI)

Maintains an online "standards portal" that gives firms access to English translations of standards and technical regulations in China, India, and Korea, as well as various U.S. standards in English, Mandarin Chinese, and Korean.

indirect nontariff barriers

May seem perfectly neutral and nondiscriminatory on their face, but their effect is to discriminate against foreign-made products or firms. They may take the form of laws, regulations, or rules of administrative agencies that make it difficult or costly to import foreign-made goods or services.

import relief

Measures which are imposed by a government when the motive is to temporarily suspend or restrict the importation of products in order to protect its domestic manufacturers from competition.

foreign like product

Merchandise produced in the same country and by the same person as the allegedly dumped merchandise, or of the same component materials, or of the same general class or king of merchandise as that dumped in the United States.

tariff-rate quota

Not really a quota at all, but a tariff rate that increases according to the quantity of goods imported.

multiple taxation

Occurs when the same service or property is subjected to the same or a similar tax by the governmental authorities of more than one nation.

global safeguards

Safeguard measures placed on imports of specific "like" products without discrimination as to their countries of origin. Take decisions such as restricting imports of a product temporarily to protect from an increase in imports causing or threatening to cause injury to domestic production.

performance standards

Set of rules that describe how a product should function, seen in the US as a form of product standard. More cost-effective for manufacturers than design standards.

antidumping (AD) duties

Special import tariffs assessed in addition to normal tariffs imposed for the purpose of offsetting the unfairly low price of dumped goods. They are not criminal fines, and they are not "damages" that are awarded to an injured firm.

direct nontariff barriers

Specifically limit imports of goods or services or deny access of foreign firms to local markets. Embargoes, quotas, complex and discriminatory licensing schemes, etc.

actionable subsidies (adverse effects subsidies)

Subsidies that are not automatically prohibited, but may still be "actionable" because of their harmful effect. A ... is one that causes material injury to the domestic producers of a like product in the complaining country, violates a trade agreement, or causes "serious prejudice" to the interests of the complaining country.

nullification or impairment

When one WTO member nation acts contrary to its commitments in a GATT/WTO agreement, such as raising a tariff above the bound rate or imposing an unjustified quota on imports. Damage to a country's benefits and expectations from its WTO membership.

conformity assessments

When one country recognizes the certifications of products from another country.

schedule of concessions

Where a country's tariff bindings and agreements are recorded at the WTO.

provisional safeguards

Where critical circumstances exist that could cause irreparable harm to a domestic industry, ..., consisting of tariffs only, can be used if clear evidence justifies the safeguards, but they must be lifted within 200 days.

Supremacy Clause

Where there is an existing federal law governing some aspect of foreign commerce, a conflicting state statute may be invalid (preempted) under the...

trade adjustment assistance (TAA)

Workers who become unemployed as a result of increased imports of foreign goods may be entitled to federal financial assistance, known as ... An agency that helps workers improve their skills and get support and resources for reemployment.