Preferential Trade Agreements and Trade Liberalization Efforts in the OIC Member States
With Special Emphasis on the TPS-OIC
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the effectiveness of removal of barriers to trade as such, typically tariffs and quotas. For
example measures which prevent the sale of foreign made goods may negate any tariff
measures which allow for their import. Deep integration provisions may address technical
barriers to trade, competition rules, investment, trade in services, intellectual property,
government procurement and trade facilitation. They rarely cover taxation.
Deep integration obligations in FTAs require the removal or alleviation of such barriers or
measures. They are intended to go beyond WTO disciplines. However in most cases the
effectiveness of such obligations is severely limited; and therefore it is important to distinguish
between hard versus soft obligations - i.e. ones where an aspiration is indicated as opposed to
those where precise and binding commitments are laid down. To be effective an obligation
must be both binding and clearly enough specified to allow violations to be identified. Where
barriers are addressed the FTA may call for harmonisation or "approximation" (the actual
word used in the original Rome Treaty) of rules.
More common is the principle of National Treatment: foreign goods must be subject to the
same rules as domestic goods even where these differ across countries. Between these two
there is the principle of mutual recognition where standards and regulations in two or more
see Chauffour and Maur (2011) for an excellent discussion of the issues discussed in this
section and from which some of the material is drawn reductions are recognised as equivalent.
The EU sought to create its Common/Internal/Single Market on the basis of harmonisation but
in the 1980s moved to a preference for mutual recognition, though this may require some
basic approximation to permit equivalence to be agreed.
In some cases reading an FTA is difficult because they contain clauses that provide now for
consultation or cooperation on trade barriers with no binding effect but a provision that there
will be action in the future. The proposed EU-US TTIP agreement, if proceeds look unlikely to
eliminate deep barriers to trade but it is claimed that there would be provisions for the
eventual creation of joint regulatory systems. Some of the EPA texts which have only firm
provisions on trade as such contain "Rendez-vous clauses" for later negotiations on regulatory
matters. Horn, Mavroidis & Sapir (2010) argue that in practice EU relevant provisions of FTAs
are rarely made legally binding and even where they are they are rarely precise enough for
there to be any real scope for judicial enforcement (for which there are rarely provisions for
penalties.) Deep integration provisions of FTAs are thus often aspirational. We can observe
that even the apparently very strong EU Europe Agreements with prospective member states
rely for their teeth on the parallel accession negotiations: failure to apply the FTA rules will
delay EU accession.
Standards and Technical Barriers to Trade
Discussion on deep integration between countries frequently focuses on technical barriers to
trade. Provisions relating to the management of standards for the protection of human, animal,