Non-tariff barriers to trade(NTB's) are trade barriers that restrict imports but are not in the usual form of a tariff.
In some forms, they are criticized as a means to evade free trade rules such as those of the World Trade Organization (WTO), the European Union (EU), or North American Free Trade Agreement (NAFTA) that restrict the use of tariffs. Some common examples of NTB's are anti-dumping measures and countervailing duties, which, although they are called "non-tariff" barriers, have the effect of tariffs once they are enacted. Their use has risen sharply after the WTO rules led to a very significant reduction in tariff use.
Some non-tariff trade barriers are expressly permitted in very limited circumstances, when they are deemed necessary to protect health, safety, or sanitation, or to protect depletable natural resources.
Non-tariff barriers may also be in the form of product standards and technical regulations, which may dictate particular manufacturing guidelines or product specifications. If products do not meet the given requirements, they will face an import ban. Examples of this sort are the European Union restrictions on genetically-modified organisms or beef treated with growth hormones.
The tendency of standards and technical regulations to disrupt trade flows has become an increasingly prominent part of the international trade policy debate. As many of the least-developed countries now have duty-free access to major developed-country markets, the trade effects of non-tariff barriers have assumed greater importance. Recent analysis carried out by the World Bank as part of its Trade Costs and Facilitation Project has focused on how product standards affect trade costs and export prospects for developing country firms exporting into developed markets.1
Examples of Non-Tariff Barriers to Trade
Non-tariff barriers to trade can be:
Import bans
General or product-specific quotas
Rules of Origin
Quality conditions imposed by the importing country on the exporting countries
Sanitary and phyto-sanitary conditions
Packaging conditions
Labeling conditions
Product standards
Complex regulatory environment
Determination of eligibility of an exporting country by the importing country
Determination of eligibility of an exporting establishment(firm, company) by the importing country.
Additional trade documents like Certificate of Origin, Certificate of Authenticity etc.
