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Import Quotas

"...exchange control and 'import quotas' together with 'tariffs' are the main form of protectionism..."

An exporter may find that the foreign country restricts mostly imports not only by means of tariffs but also by qualitative measures.

These usually take the form of import quotas for each particular product. Once the quota for the period has been filled, no more import licenses are issued.

Types of Import Quotas

There are three main types of import quota in use today:

1. Unilateral quotas

2. Negotiated bilateral or multilateral quotas

3. Tariffs quotas

1. Unilateral Quotas
These are quotas set by a country without pervious consultation or negotiation with others. Such a quota may be global or allocated.

If it is global, the total volume of goods that may be imported is set regardless of the countries of origin or the importers and exporters involved.

 


Site Contents for:
Export Trade Barriers

Page 1/11 Tariff Barriers and Non-tariff barriers

Page 2/11 - About Tariff Lists, Dutiable Value and Anti Dumping Duties

Page 3/11 Countervailing Duties, "...substantial additional charge on export is the consular fee required..." Customs Nomenclature

Page 4/11 Free Trade Zone, Bonded Warehouses GATT now known as WTO

Page 5/11 European Directive and CE marking requirement 

Page 6/11 Trading Blocks, common tariff barrier &  European Economic Community

 
 

 

 

 

 

 

 

 


If it is allocated, the permitted volume
of imports is allocated among countries of origin and private traders in accordance with some previous pattern.
 

2. Negotiated Quotas

In this case, the importing country, after negotiations with the government of each exporting country, or with groups of its exporters, allots shares of the quota to each country.

Often, with a bilateral negotiated quota, the exporting country is given the responsibility for issuing licenses to its exporter.

Sometimes a negotiated bilateral quota goes under the guise of a voluntary export quota - for example, the "voluntary" quotas that Japan places on its exports of man-made textiles to the United States.

With a multilateral quota, the restriction is placed on the total amount of imports only, with no restriction as to source.
 

3. Tariff Quotas

With this type of quota, a country allows a certain amount of a product to enter at a given rate of import duty or even duty free. Any excess amount is subjected to a much higher rate of duty.

 

 


Page 7/11 ASEM Members, APEC -Asia Pacific Economic Cooperation, AABF Africa-Asia Business Forum CHOGM

<<This Page 8/11 Exchange control and 'import quotas' together with 'tariffs' are the main form of protectionism

Page 9/11 Voluntary restrain & Custom delays - France, once required Japanese video players be cleared through a tiny Customs office with horrendous delays. 

Page 10/11 APEC Asia-Pacific Economic Cooperation - This huge regional trade group from 21 nations accounts for more than half of the world's economic output and 42% of its population.

Page 11/11 The ASEAN Economic Community represents a huge market with a combined population of one 600 million people.

 

 

 

 
 

Exchange Controls

Some countries restrict imports by limiting the amount of "exchange", or foreign currency, available to pay for them. Often, imports are classified into essential and non-essential or luxury goods.

Foreign currency is made available at one rate of exchange for essential imports while a more limited amount of foreign currency is made available at a much higher rate of exchange for the luxury items such as foreign cars.

This restrict the imports of luxury goods and are taxed more heavily than essential goods through the sale of foreign currency at a "free market" rate of exchange rather than at the official one.

Other countries achieve the same effect by levying exchange taxes at various rates according to the priority attached to the product to be imported.

With exchange control, anyone wishing to obtain foreign exchange must secure permission from the government. Such a system permits the government to restrict the demand for scare foreign exchange and to ration it out among different needs.

This rationing of foreign exchange also applies to importers: they must obtain a foreign exchange permit before they can import any goods and must pay a higher rate of exchange for imports of "luxury" or "non-essential" goods.

Exchange control, like import quotas, is therefore another very effective way of restricting imports as well as other types of foreign exchange spending.

Together with tariffs and import quotas, it forms the main form of protectionism.

Next page 9/11 Voluntary restrain & Custom delays
France, once required Japanese video players be cleared through a tiny Customs office with horrendous delays.

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Site Contents for:
Export Trade Barriers

 


Site Contents for:
Secrets of
International Trade


 

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