Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-78c5997874-g7gxr Total loading time: 0 Render date: 2024-11-08T16:29:02.823Z Has data issue: false hasContentIssue false

5 - The Need for Better Disciplines on Rules of Origins in the WTO

Evidence from NAFTA

from Part I - New and Old Challenges

Published online by Cambridge University Press:  05 August 2019

By
Caroline Freund
Edited by
Manfred Elsig ,
Michael Hahn  and
Gabriele Spilker
Manfred Elsig
Affiliation:
Universität Bern, Switzerland
Michael Hahn
Affiliation:
Universität Bern, Switzerland
Gabriele Spilker
Affiliation:
Universität Salzburg
Get access

Summary

This chapter shows that the rules of origin, which are meant to protect against the trans-shipment of foreign goods in free trade areas, are instead being used to promote particular industries. Strict rules of origin add to production costs by forcing firms to use more expensive parts and pay administrative costs. They also prevent firms from exporting to markets governed by different trade agreements and disproportionately hurt small firms. The ongoing renegotiation of NAFTA highlights the potential to expand the use rules of origin as a form of trade protection. The WTO currently has only limited disciplines on rules of origin. Clear and enforceable international regulations would help thwart the spread of complex rules.

Keywords

rules of originNAFTAWTOtrade protection
Type
Chapter
Information
The Shifting Landscape of Global Trade Governance
World Trade Forum
 , pp. 107 - 120
Publisher: Cambridge University Press
Print publication year: 2019

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Cadot, O. and de Melo, J.. 2007. “Why OECD Countries Should Reform Rules of Origin,” Manuscript, University of Lausanne.Google Scholar
Cadot, O., de Melo, J., Estevadeordal, A., Suwa-Eisenman, A. and Tumurchudur, B.. 2002. “Assessing the Effect of NAFTA’s Rules of Origin,” In: Laboratoire d’Economie Appliquee, INRA, Research Unit Working Papers.Google Scholar
Conconi, P., Garcia-Santana, M., Puccio, L., and Venturini, R.. 2016. “From Final Goods to Inputs: The Protectionish Effect of Rules of Origin,” CEPR Discussion Paper No. DP11084, https://ssrn.com/abstract=2726564.Google Scholar
Estevadeordal, A. and Suominen, K.. 2003. “Rules of Origin in the World Trading System,” Paper Prepared for the Seminar on Regional Trade Agreements and the WTO. Geneva, 14 November.Google Scholar
Estevadeordal, A., Suominen, K., Harris, J. and Shearer, M.. 2009. Bridging Regional Trade Agreements in the Americas: Special Report on Integration and Trade. IDB Publications, Interamerican Development Bank, no 255.Google Scholar
Falvey, R. and Reed, G.. 1998. “Economic Effects of Rules of Origin,” Weltwirtschaftliches Archiv 134(2):209–29.Google Scholar
Ju, J. and Krishna, K.. 2005. “Firm Behaviour and Market Access in a Free Trade Area with Rules of Origin,” Canadian Journal of Economics 38(1):290–308.Google Scholar
Krishna, K. 2005. “Understanding Rules of Origin,” NBER Working Paper 11150.CrossRefGoogle Scholar
Krishna, K. and Krueger, A.. 1995. “Implementing Free Trade Areas: Rules of Origin and Hidden Protection,” In: Deardorff, A., Levinsohn, J. and Stern, R. (Eds.), New Directions in Trade Theory. University of Michigan Press, pp. 149–87.Google Scholar
Moroz, A. 2017. “Navigating the Maze: Canada, Rules of Origin and the Trans-Pacific Partnership (and Two Tales of Supply Chains),” In: Van Assche, A., Wolfe, R. and Tapp, S. (Eds.), Redesigning Canadian Trade Policies for New Global Realities. Montreal, Canada: IRPP.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×