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According to on Article 3 of the Trade Barriers Investigation Regulation, promulgated on Feb.2, 2005, trade barriers are defined in the Report as government-imposed or government-supported measures or practices that satisfy one of the following:

--inconsistent with or failing to fulfill the obligations provided in any economic and trade treaties or agreements of which both the given trading partner and China have concluded or acceded to;

--which results in one of the following negative trade effects:

     -imposing or threatening to impose obstacle or restriction on the access of Chinese products or services to the market of the given trading partner or the market of any other trading partner;

    -causing or threatening to cause impairment to the competitiveness of Chinese products or services on the market of the given trading partner or the market of any other trading partner.

    -imposing or threatening to impose obstacle or restriction on the products or services of the giving trading partner or any other trading partner exporting to China.

Trade barriers are defined in the Report mainly according to WTO agreements as the majority of China’s trading partners are WTO members. In case of non-WTO members or a given trade barrier not covered by WTO agreements, bilateral or plural-lateral agreements or established international trade practices will be taken as references.

The Report classifies foreign trade barriers into fourteen different categories as follows:

--Tariff and tariff administrative measures, e.g., tariff peak and unjustified practices in tariff quota administration;

--Import restrictions, e.g., unjustified import ban and import licensing;

--Barriers to Customs procedures, e.g. procedural obstacles in customs clearance, unjustified charges on imports;

--Discriminatory taxes and fees on imported goods;

--Technical barriers to trade, e.g., unjustified technical regulations and standards applied to imported products, complicated certification and conformity assessment procedures;

--Sanitary and phytosanitary measures, e.g., unnecessarily strict quarantine requirements and procedures applied to imported products;

--Trade remedies, e.g., unfair anti-dumping measures imposed on imported products, insufficient transparency in investigation procedures of trade remedy, in particular the abusive application to Chinese enterprises of measures designed for non-market economy;

--Government procurement, e.g., insufficient transparency, violation of most-favored-nations clause;

--Export restrictions, e.g., extraterritorial legislation that restricts or impedes trade between third countries, and unjustified export control measures in the name of national security;

--Subsidies, e.g., subsidies inconsistent with WTO rules that artificially stimulate exports of particular domestic products;

--Barriers to trade in services, e.g., unjustified restrictions on access of foreign services;

--Inadequate intellectual property right protection, e.g., inadequate intellectual property protection on imported products

--Unjustifiable protection of intellectual property right e.g., restrictive measures on imported products in the name of intellectual property protection;

--Other barriers, i.e. measures or practices with trade distorting effects other than above categorized.

Barriers to investment are defined in the Report mainly according to WTO rules and relevant multilateral, plural-lateral and bilateral agreements. Hereby, barriers to investment in the Report refer to government-imposed or government-supported measures, satisfying one of the following:

--inconsistent with a multilateral/plural-lateral agreement of which both the given trading partner and China are among the signatories, or a bilateral investment protection agreement signed between the given trading partner and China; or failing to fulfill obligations provided in a multilateral/plural-lateral investment agreement of which both the given trading partner and China are among the signatories or a bilateral investment agreement signed between the given trading partner and China.

--imposing or threatening to impose unjustified obstacle or restriction on Chinese capital’s access to or withdrawal from the market of the given trading partner; or

--causing or threatening to cause impairment to the interest of commercial entities with Chinese investment in the given trading partner.

The Report classifies barriers to investment into three different categories as follows:

--Barriers to the access of investment, e.g., unjustified restrictions on access of foreign capital, and in case of WTO members, failure in fulfilling its commitment to open certain sectors to foreign investment;

--Barriers to operation, e.g., unjustified restrictions on the operation of foreign invested enterprises in their production, supply, sales, human resources management, finance, logistics, etc.;

--Barriers to withdrawal of investment, e.g., restrictions on the withdrawal of foreign investment or the transfer of profits of foreign invested enterprises from the host-country.

Besides the WTO General Agreement on Trade in Services (GATS) takes commercial presence as trade in service. However, in practice, supply of services by commercial presence is usually accompanied or completed by investment. Therefore, certain investment restrictions on commercial presence can be regarded as either barriers to trade in services or barriers to investment. In view of harmonizing the categorization in the Report in line with the GATS, investment restrictions on commercial presence are classified as barriers to trade in services.

The comments in the Report are based on the information we have received, so it doesn't necessarily mean that the trade partners covered in the Report don't maintain any barriers to trade and investment of other unmentioned categories.