Non-Tariff Measures in International Trade

A tariff is a customs duty imposed on imported goods, usually raising their landed price. Non-tariff measures (NTMs) are policy measures other than ordinary customs tariffs that can affect the quantity, price, or conditions of international trade.

Basis of distinction

• Tariffs operate through a tax on imports; NTMs operate mainly through regulations, quantitative limits, procedural requirements, or conditions for market access.
• Tariffs generally have a direct and observable price effect and generate customs revenue; the price and revenue effects of NTMs are often indirect or difficult to measure.
• Tariffs are applied at the border according to a customs schedule; NTMs may operate at the border or through domestic regulations affecting imported products.
• Tariff commitments are commonly expressed as bound and applied rates; NTMs are assessed through rules on necessity, transparency, scientific justification, and non-discrimination, depending on the measure.

Principal non-tariff measures

NTMs cover a wide range of instruments, and their legal treatment depends on their design and purpose.

• Quantitative restrictions include quotas, prohibitions and certain import licensing requirements that directly limit or control imports.
• Sanitary and phytosanitary measures protect human, animal, or plant life and health from specified risks.
• Technical regulations, standards and conformity-assessment procedures address product characteristics, safety, quality, labelling, or testing.
• Other measures include rules of origin, customs formalities, price-control measures and contingent trade remedies such as anti-dumping or safeguard action.

Measures versus barriers

An NTM is not necessarily protectionist. Health, safety, environmental protection and consumer information are legitimate objectives, but an NTM becomes a non-tariff barrier when its design or administration unnecessarily restricts trade, discriminates against imports, or disguises protectionism.

• Compliance costs can weigh disproportionately on small exporters and countries with limited testing or certification capacity.
• Transparent rules, equivalence, mutual recognition and regulatory cooperation can reduce trade costs without weakening legitimate protection.