Technical Barriers to Trade
Technical barriers to trade are discrepancies in product requirements from one country to another, and in approval and control procedures (testing, certification, etc.) for evaluating compliance with such requirements.
All governments around the world make regulations. When these regulations relate to products that are traded, there will be an effect on trade with other countries, since foreign suppliers will need to comply with the importing country’s regulations. Over the years, there have been substantial efforts around the world to reduce the impact on trade of national or regional regulation. Technical regulations may serve legitimate ojectives, but at the same time efforts are necessary to ensure that such regulations should not be more trade-restrictive than necessary to achieve such objectives.
The WTO Agreement on Technical Barriers to Trade (“TBT Agreement”), which entered into force in 1995, is the multilateral successor to the Standards Code, signed by 32 GATT contracting parties at the conclusion of the 1979 Tokyo Round of Trade Negotiations. The purposes of the TBT Agreement can be broadly described as: (1) assuring that technical regulations, standards and conformity assessment procedures, do not create unnecessary obstacles to international trade, while (2) leaving Members adequate regulatory discretion to protect human, animal and plant life and health, national security, the environment, consumers, and other policy interests.
The phrase “technical barriers to trade” refers to the use of the domestic regulatory process as a means of protecting domestic producers.
The TBT Agreement seeks to assure that technical standards, regulations and conformity assessment procedures (procedures designed to test a product’s conformity with mandatory regulations or voluntary standards) do not cause unnecessary obstacles to international trade.
Thus the TBT Agreement seeks to balance two competing policy objectives:
(1) The prevention of protectionism, with
(2) the right of a Member to enact product regulations for approved
(legitimate) public policy purposes (i.e. allowing Members
sufficient regulatory autonomy to pursue necessary domestic policy
objectives).