International Business: The New Realities, 5th Edition

Nontariff Trade Barriers

Nontariff trade barriers are government policies or measures that restrict trade without imposing a direct tax or duty. They include quotas, import licenses, local content requirements, government regulations, and administrative or bureaucratic procedures. The use of nontariff barriers has grown substantially in recent decades. Governments sometimes prefer them because they are easier to hide from the WTO and other organizations that monitor international trade.

Quotas restrict the physical volume or value of products that firms can import into a country. In a classic type of quota, the U.S. government imposed an upper limit of roughly 2 million pounds on the total amount of sugar that can be imported into the United ...