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Part 4:
IMPORT POLICY

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Contents
Import Policy

Tariffs Non-tariff Barriers

Definition Quantitative restrictions

Types of Tariffs Para-tariff measures

Tariff Rates Price control measures

Monopolistic measures
Customs Valuation
Technical measures
Tariff Schedules
Trade -related investment measures
Tariffs & Welfare
Administrative procedure measures
Roles of Tariffs
Temporary protection measures

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1. Import Tariffs

1.1. Definitions
v A tariff.

v A protective tariff.

v A revenue tariff.

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.1. Definitions
v Tariffication.

v A bound tariff.

v Tariff escalation.

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.2. Types of Tariffs

1.2.1. Specific tariff more convenient
for gov
Ex: $100 per computer, regardless of the
computer’s price.
1.2.2. Ad valorem tariff

Ex: 2.5 percent on imported automobiles.

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.2. Types of Tariffs

1.2.3. Compound Tariff
thuế hỗn hợp
Ex: 5$ per unit + 6,25%. VN gov is not
1.2.4. Seasonal Tariff allowed to use
this (hiệp định khi
gia nhập WTO)
Ex: Grapes, grapefruit in the U.S.

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.2. Types of Tariffs

1.2.5. Tariff-Rate Quota (Two-Tier Tariff)

Tariff rate

T Over the quota

Within the quota

t

Quota Imports
Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.3. Tariff Rates

1.3.1. Preferential tariffs

1.3.2. Most-favoured-nation treatment

= Normal trade relations (NTR)

1.3.3. Non-MFN

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.4. Customs Valuation

Agreement on Customs Valuation - ACV
1) Transaction Value of Goods in Question -
price actually paid or payable for the goods
sold. (Art. 1)
2) Transaction Value of Identical Goods (Art. 2)
3) Transaction Value of Similar Goods (Art. 3)
4) Deductive Value (Art. 5)
5) Computed Value (Art. 6) Interchangeable
6) Derivative Method (Art. 7)

Lecturer: Tran Quoc Trung (MBA)

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1. Import Tariffs

1.6. Tariff Welfare Effects

v Small-Nation Model
P
D
∆ PS = a
∆ CS = - (a + b + c + d)
S
∆ Government Revenue = c

PDt ∆ Social Welfare = - (b + d)

Tariff a b c d
PD = Pw

0 Q1 Q2 Lecturer:QTran Q4 Trung (MBA)

3 Quoc

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1. Import Tariffs

1.7. Roles of Tariffs

1.7.1. Protection of Domestic Production
1.7.2. One Source of Government Revenue
1.7.3. Promotion of Trade Liberalization

Lecturer: Tran Quoc Trung (MBA)

1.7.1. Protection of Domestic Production LOGO

a. Nominal Rate of Protection – NRP

v Specific tariffs:

v Ad valorem tariffs:

Lecturer: Tran Quoc Trung (MBA)

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1.7.1. Protection of Domestic Production LOGO

b. Effective Rate of Protection - ERP

Ø VAd: Domestic Value Added

Ø VAi: International Value Added

Lecturer: Tran Quoc Trung (MBA)

1.7.1. Protection of Domestic Production LOGO

b. Effective Rate of Protection - ERP

Positive protection VAd > VAi ERP > 0

Negative protection VAd < VAi -1 < ERP < 0
No protection VAd = VAi ERP = 0

Lecturer: Tran Quoc Trung (MBA)

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1.7.3. Promotion of Trade Liberalization

a. Tariffication of non-tariff barriers

b. Binding and cutting tariffs
v On WTO accession, the whole existing tariff
schedule of Vietnam was bound, including
about 10.600 tariff lines.
v Reduction of about 3.800 tariff lines
(35,5%); binding at the existing rates about
3.700 lines (34,5%) and binding with ceilings
about 3.170 lines (30%).

Lecturer: Tran Quoc Trung (MBA)

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2. Non-Tariff Barriers to Trade

Non-tariff barriers to trade (NTBs) are

trade barriers that restrict imports but are
not in the usual form of a tariff.

Although tariffs have come down

in recent decades, nontariff trade
barriers have multiplied.

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2.1. Qualitative Restrictions

WTO Stipulations
Ø Elimination of Quantitative Restrictions
“No prohibitions or restrictions other than
duties, taxes or other charges, whether
made effective through quotas, import or
export licences or other measures, shall be
instituted or maintained by any contracting
party…”
GATT 1994 Article XI Paragraph 1

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2.1. Qualitative Restrictions

2.1.1. Prohibition
Prohibition is the legal action preventing
certain commodities from being exported
from or imported to a country.
v This instrument must be applied in
accordance with the WTO’s principles and
stipulations.
v In Vietnam: Decree 187/2013/ND-CP.

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2.1. Qualitative Restrictions

2.1.2. Import Quota

a. Definition
v An import quota is a physical restriction
on the quantity of goods that can be
imported during a specific time period.
v A common practice to administer an
import quota is for the government to
require an import license.

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2.1. Qualitative Restrictions

2.1.2. Import Quota

b. Types of Import Quota
v Global quota permits a specified number
of goods to be imported each year, but it
does not specify from where the product is
shipped or who is permitted to import.
v Selective quota are allocated to specific
countries to avoid the problems of a global
quota system.

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2.1. Qualitative Restrictions

c. Import Quota & Welfare effects

v Small-Nation Model
P
D
∆ PS = a
∆ CS = - (a + b + c + d)
S
∆ ??? = c

PDq ∆ Social Welfare = - (b + d)

a b c d
PD = Pw

0 Q1 Q2 Q3 Q4

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2.1. Qualitative Restrictions

2.1.3. Import Licensing

a. Definitions
v An import license is a document issued by
a national government authorizing the
importation of certain goods into its territory.
v Import licensing procedures mean the
procedures on dossiers of application for import
licenses and the process of receiving,
processing dossiers and making decisions by
agencies with import licensing competence.

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2.1. Qualitative Restrictions

2.1.3. Import Licensing

b. Forms of Import Licensing
v Non-automatic import licensing

v Automatic import licensing.

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2.2. Para-tariff measures

Para-tariff measures are the measures

that increase the cost of imports in a
manner similar to tariffs.
2.2.1. Decreed Custom valuation

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2.2. Para-tariff measures

2.2.2. Customs/Import surcharges

2.2.3. Additional charges

Ex: Tax on foreign exchange transactions, airport license fee,

statistical tax, tax on transport facilities.

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2.3. Price control measures

2.3.1. Administrative price fixing of

import prices
The authorities of the importing country take
into account the domestic prices of the
producer or consumer establish floor and ceiling
price limits.
2.3.2. Voluntary export price restraint
A restraint arrangement in which the
exporter agrees to keep the price of his goods
above a certain level.

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2.3. Price control measures

2.3.3. Variable charges

v Variable charges bring the market prices of
imported products close to those of
corresponding domestic products for a given
period of time and for a pre-established price.
v The pre-established price is known as
reference price, threshold price or trigger price.

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2.4. Monopolistic measures

2.4.1. Single channel for imports

2.4.2. Compulsory national services

LOGO are important bc some goods are dangerous

2.5. Technical measures
to people
Technical measures are measures however, some country try to take advantage of
referring to product characteristics such as
quality, safety or dimensions, including the this to reduce import
applicable administrative provisions,
terminology symbols, testing and test Đã áp dụng nước ngoài thì phải áp dụng trong nước
methods, packaging, marking and labeling
tương tự
requirements as they apply to a product.

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2.5. Technical measures

2.5.1. Technical regulations

a. Definitions
Technical regulations provide technical
requirements, either directly or by referring to
or incorporating the content of a standard,
technical specification or code of practice.

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2.5. Technical measures

2.5.1. Technical regulations

b. Purposes
v Protection of human life or health or to
protect animal life or health (sanitary
regulation);
v Protection of plant health (phytosanitary
regulation);
v Protection of the environment and wildlife;
v Ensuring national security;
v Ensuring prevent deceptive practices.

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2.5. Technical measures

2.5.2. Labeling requirements

2.5.3. Testing, inspection requirements

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2.6. Trade-related investment measures

Domestic law or administrative rulings

require:
v An enterprise purchases or uses products of
domestic origin whether specified in terms of
particular products, in terms of volume or value
of products, or in terms of a proportion of volume
or value of its local production.
v An enterprise purchases or uses of imported
products limited to an amount related to the
volume or value of local products that it exports.

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2.7. Administrative procedure measures

2.7.1. Customs procedure

2.7.2. Government procurement procedure

2.7.3. Rules of origin

2.8. Temporary protection measures LOGO Đọc hiệp định anti-dumping

2.8.1. Anti-dumping Điều 1&5

v Dumping is occurs when foreign buyers are
charged lower prices than domestic buyers for an
identical product, after allowing for transportation
costs and tariff duties.
v Antidumping duty is imposed in addition to
the normal tariff in order to neutralize the effects
of price discrimination or below-cost sales.
v Margin of dumping is the amount by which
the export price of an imported product is less
than its normal value.

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2.8. Temporary protection measures

2.8.2. Subsidies and countervailing measures

v A subsidy is an assistance paid to a business
or an economic sector.
v A domestic production subsidy is granted
to producers of import-competing goods.
v An export subsidy goes to producers of
goods that are to be sold overseas.
v “Countervailing duty” is imposed on
subsidized imports that are found to be
hurting domestic producers.

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