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Most-favoured-nation treatment

Most-favoured-nation treatment. Cornerstone of the GATT and of the WTO trading system (exceptions). No discrimination between like products and equality of opportunity to import or to export. Discrimination de jure and de facto (origin-neutral measures) are prohibited.

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Most-favoured-nation treatment

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  1. Most-favoured-nation treatment Cornerstone of the GATT and of the WTO trading system (exceptions). No discrimination between like products and equality of opportunity to import or to export. Discrimination de jure and de facto (origin-neutral measures) are prohibited.

  2. Article I:1 GATT (I) The MFN rule covers any advantage granted to any product originating in (or destined for) any other Member. Advantages (broad notion, limits): • Customs duties or other charges on importation and exportation, included methods of levying them; • Charges on international transfer of payments; • All rules and procedures regarding importation and exportation; • Internal taxes or charges and rules affecting internal sale.

  3. Article I:1 GATT (II) The MFN rule regards like products: • that have the same organoleptic characteristics; • that have the same end-use; • that are considered to be like in the consumers’ perspective.

  4. Article I:1 GATT (III) The MFN rule requires that the advantage concerned must be granted immediately and unconditionally to any other Member. Different interpretations of “unconditionally”: • not to be subject to conditions requiring compensation or conduct of the other Member States; • not to be subject to any condition; • not to be subject to conditions that discriminate between products on the basis of their origin.

  5. Article II:1 GATS (I) The MFN rule concerns measures covered by the GATS and affecting the trade in services. 4 modes of supply of service: 1) cross border mode; 2) consumption abroad mode; 3) commercial presence mode; 4) presence of natural persons mode.

  6. Article II:1 GATS (II) The MFN rule: • regards like services or like services suppliers; • requires that a treatment no less favourable must be granted immediately and unconditionally to any other Member.

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