Möbel & Innenausbau
Apr 14
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Voluntary Export Restraint Agreements

The most notable example of VERs is that, in the 1980s, due to American pressure, Japan imposed a VER for its car exports to the United States. Subsequently, the VER granted the U.S. auto industry some protection against a wave of foreign competition. This relief was short-lived, however, as it eventually led to an increase in exports of japanese vehicles at higher prices and a spread of Japanese assembly plants in North America. Voluntary export restrictions fall into the broad category of non-tariff barriers, such as quotas, sanctions taxes, embargoes and other restrictions. As a general rule, VERs are the result of a request from the importing country to grant a protection premium to its domestic companies that manufacture competing products, while these agreements can also be concluded at the sectoral level. Quantitative export restrictions appear to have first appeared in 1935, when Japan was forced to restrict its textile exports to the United States. However, they have only been widespread in the last ten years. The attached table lists nearly 100 known large ERSs. The actual figure may well be higher, as it is reported that there are various undisclosed agreements between industry and companies. Of the known number of VERs, 55 limit exports to the European Community or its Member States, and 32 limit exports to the United States. In general, worms have been introduced to protect industries in OECD markets, where some developing countries, Eastern European countries or Japan have become serious competitors. In fact, exports from these countries have been held back by about 80 VERs.

In the 1950s and 1960s, American textile producers faced increasing competition from Southeast Asian countries. Textile producers in Europe have faced as stiff a competition as their American counterparts and have therefore acted on voluntary export restrictions. A typical VER limits export supply by product type, country and volume. GATT articles dealing with trade measures prohibit export restrictions under normal circumstances; where authorized, they can only be discriminatory and can only be applied through customs duties, taxes and taxes. However, government involvement in VERs is not always clear. In addition, VERs do not always have market allocation rules; they can take the form of an export forecast. B and, therefore, as a precautionary measure. For these reasons, VERs fall into a „grey area“ as their illegality under the GATT may exist. In addition, it is unlikely that the parties to an VER will seek a finding in the GATT dispute resolution procedures – they have never done so – whereas third parties often appear to use an VER and, therefore, may be reluctant to initiate dispute resolution proceedings.

Finally, it appears that the signatories to the Subsidies and Countervailing Rights Code, which grew out of the Tokyo trade negotiation round, have acquired legal powers to negotiate VERs. In this regard, the 1987 GATT Council of Representatives decision to establish a litigation body to review the Japan-U.S. semiconductor agreement is important.

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