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World Trade Organization Toolkit : Non-Tariff Barriers to Trade

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Investment

Relations between trade and investment did not originally receive specific attention in the GATT.

However, there was an increasing concern that the existing GATT rules Articles III (National Treatment) and XI (prohibition of quantitative restrictions) were not being adequately respected with respect to investment measures. As a result, it was decided during the Uruguay Round to negotiate a specific agreement on trade-related investment measures (TRIMs).

Article 2 of the TRIMs Agreement precludes Members from applying any TRIM that is inconsistent with Article III or Article XI of the GATT.

An annex to the Agreement contains an illustrative list of TRIMS that are inconsistent with the national treatment obligation of Article III:4 and the obligation of general elimination of quantitative restrictions in Article XI:1. For instance, the list includes measures which require particular levels of local procurement by an enterprise.

All GATT exceptions apply to the Agreement.

The most significant aspects of the Agreement are the notification requirements and "transitional arrangements" found in Article 5. Members were obliged to notify the Council for Trade in Goods before April 1995 of all TRIMS they were applying, whether general or specific, that were not in conformity with the Agreement, by giving a description of the principal features.

All notified TRIMS had to be eliminated by the end of 1996. For developing countries, and the least-developed countries the deadlines were end-1999 and end-2001 respectively. However, these might be deferred if implementation caused particular difficulties.

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