ACCA Applied Skills · Corporate and Business Law (Global) · International trade, international legal regulation and conflict of laws
Zeta, a WTO member, grants Country A's goods a lower import tariff than the rate applied to the same goods from other WTO members, with no qualifying exemption. Which WTO principle is Zeta most clearly breaching?
Zeta breaches the most favoured nation principle. A WTO member must extend any trade advantage given to one member to all other members. Giving only Country A a lower tariff, without a qualifying exception, discriminates between trading partners.
- ANational treatment
- BMost favoured nation treatmentCorrect
- CTransparency of trade rules
- DReciprocity in dispute settlement
Explanation
Most favoured nation treatment requires a member to give all other members the same favourable treatment it gives any one member. Favouring Country A over other members breaches it. National treatment concerns treating imported goods no less favourably than domestic goods once they have entered the market, not differences between exporting countries.
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