Trade restriction

A series on Trade
World trade
Policy Import Export Balance of trade Trade law Trade pact Trade bloc Trade creation Trade diversion Export orientation Import substitution Trade finance Trade facilitation Trade route Domestic trade Tax, tariff and trade
Restrictions Trade barriers Tariffs Non-tariff barriers Import quotas Tariff-rate quotas Quota share Import licenses Customs duties Export subsidies Technical barriers Bribery Exchange rate controls Embargo Safeguards Countervailing duties Anti-dumping duties Voluntary export restraints
History Mercantilism Protectionism Laissez-faire Free trade Economic nationalism Economic integration
Organizations International Monetary Fund International Trade Centre World Trade Organization World Customs Organization
Economic integration Preferential trading area Free trade area Customs union Single market Economic union Monetary union Fiscal union Customs and monetary union Economic and monetary union
Issues Intellectual property rights Smuggling Competition policy Government procurement Outsourcing Globalization Fair trade Trade justice Emissions trading Trade sanctions War Currency Customs Trade Trade and development
Lists Imports Exports Tariffs Largest consumer markets Leading trade partners
By country Trade mission Trading nation United States Argentina Pakistan Romania Vietnam India
Theory Comparative advantage Competitive advantage Heckscher–Ohlin model New trade theory Economic geography Intra-industry trade Gravity model of trade Ricardian trade theories Balassa–Samuelson effect Linder hypothesis Leontief paradox Lerner symmetry theorem Terms of trade
v t e

A trade restriction is an artificial restriction on the trade of goods and/or services between two countries. It is the byproduct of protectionism. However, the term is controversial because what one part may see as a trade restriction another may see as a way to protect consumers from inferior, harmful or dangerous products. For instance Germany required the production of beer to adhere to its purity law. The law, originally implemented in Bavaria in 1516 and eventually becoming law for newly unified Germany in 1871, made many foreign beers unable to be sold in Germany as "beer". This law was struck down in 1987 by the European Court of Justice, but is still voluntarily followed by many German breweries.

Case study: headlamps

Rectangular headlamps were promoted in the United States where round lamps were required until 1975. By 1979, the majority of new cars now had the rectangular headlamps. Again, the U.S. permitted only two standardized sizes of rectangular sealed-beam lamp: A system of two 200 mm x 142 mm high/low beam units corresponding to the existing 7" round format, or a system of four 165 mm x 100 mm units (two high/low and two high-beam) corresponding to the existing 5¾ inch (146 mm) round format.

In 1968 the U.S. DOT outlawed any decorative or protective element in front of the headlamps whenever the headlamps are switched on. Glass-covered headlamps, used on e.g. the Jaguar E-Type, the pre-1968 VW Beetle, the Porsche 356, the Citroën DS and Ferrari Daytona. therefore had to be equipped with uncovered headlamps for the US market, further altering the look of European models sold in the United States. This change meant that vehicles designed for solid aerodynamic performance could not achieve it for the US market. In 1984, the DOT changed this rule, allowing replaceable-bulb headlamps of nonstandard shapes. However, this change did not mean that an automaker could equip a vehicle with the same type of headlamps in the US as in the rest of the world. United States headlamp standards are governed by Federal Motor Vehicle Safety Standard 108, which is incompatible with the UNECE standards used in most of the rest of the world. Canada has its own headlamp standards similar to the US standard, but allows UNECE-compliant headlamps. Also Headlamps were not only used in cars but also used for traffic violation stops.