Archivo categoría International Trade law

Which is the definition of NOM?

A NOM is an acronym for “Norma Official Mexicana” – a mandatory Mexican standard that applies to a particular product or range of products. A product that is subject to a NOM cannot be imported into Mexico unless it is certified as being in compliance with the relevant NOM.

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What “TRIPS” does mean?

The acronym “TRIPS” refers to “trade–related intellectual property issues”. The TRIPS Agreement is part of the GATT-WTO system. It breaks new ground because it does not deal strictly with trade in goods. It fills the IPR gap within GATT by establishing minimum levels of protection for copyrights, trademarks, geographical indications, industrial designs, patents, plant varieties, computer chip layout designs, and trade secrets. It couples these IPR protections with the requirement that WTO Members adopt effective enforcement mechanisms.

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What is a certificate of origin?

A certificate of origin is a specific document identifying the goods. The authority or body empowered to issue it certifies expressly that the goods to which the certificate relates originate in a specific country. This certificate may also include a declaration by the manufacturer, producer, supplier, exporter or other competent person.

An erroneous application of the country of origin rules under a specific trade agreement can have disastrous consequences for the parties involved in the transaction. For example, merchandise marked with the incorrect country of origin may be subject to seizure of an assessment of supplemental marking duties. The Customs authorities in several countries may also impose substantial monetary or criminal penalties against the importer if Customs suspects that the importer purposefully obscured, removed, or altered the country of origin mark.

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What happens if an import shipment arrives in the U.S. and the quota for the product in the shipment has already been filled?

A quota is a limitation on the quantity of goods that may be imported into a country from all countries or from specific countries during a prescribed time period.

There different types of quotas: quantitative quotas and tariff-rate quotas. A quantitative quota (also referred to as an absolute quota) is any pre-set quantity of given goods authorized for importation, during a specified period, beyond which no additional quantity of these goods can be imported.

A tariff-rate quota is any pre-set value or quantity of given goods authorized for importation, during a specified period with a reduction of the Customs duties. Once a tariff-rate quota is met, additional quantity of the goods subject to the tariff rate quota can still be imported, but higher Customs duties must be paid.

So, therefore, the product generaly cannot be admitted into the country and the importer has the option of exporting the product, destroying the product or entering the product into a foreign trade zone or a bonded warehouse until the beginning of the next quota period.

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What is the difference of a standy letter of credit from a documentary letter of credit?

A standby letter of credit is a letter of credit that is issued in favor of the standby letter of credit beneficiary for the purpose of “backing-up” certain specified obligations of the standby letter of credit applicant. A standby letter of credit requires the beneficiary’s presentation of documents which indicate that the letter of credit applicant has not met the obligations which the standby letter of credit backs-up. A standby letter of credit, therefore, is not intended to be drawn upon by the standby letter of credit beneficiary unless the standby letter of credit applicant does not meet its obligations as specified by the standby letter of credit.

A documentary letter of credit (also known as a commercial letter of credit or a merchandise letter of credit) is a letter of credit that is issued for the purpose of making payment to a specified beneficiary if the beneficiary performs as required. Documentary letters of credit are called documentary letters of credit because the banks involved in the letter of credit transaction deal in documents as opposed to goods. The terms and conditions specified in a documentary letter of credit generally involve the presentation of specific documents within a stated period of time.

The principal difference between a standby letter of credit and a documentary letter of credit is the fact that a documentary is an active payment instrument under which payment is intended if the terms and conditions prescribed by the letter of credit are met, whereas a standby letter of credit is a passive payment instrument under which payment is not intended and will occur only if the standby letter of credit applicant fails to meet its obligations as specified by the standby letter of credit.

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