Principles of Standardization in International Trade

The best way to define standards is a “system of reference” which would typically be used by the parties in the export-import or transit activities. The standards guarantee the technical specifications related to products, services and organizations, including their quality, usage and rights. However, unless they are cited as a regulation or a directive, their usage is not necessary. These standards usually vary from one country to another, however large international trade organizations such as the WTO or Customs Unions such as the EU tend to generalize these standards, in order to reduce the number of misunderstandings or to resolve dispute regarding the aforementioned trade activities.

There is a number of relevant standardization bodies:

One of them is ISO – International Organization for Standardization. It aims to harmonize the standards on a Global Level. Elaborated in the Global Consensus Framework, it contributes to rationalization of the International Trade Framework.

The ISO has been created in 1947 Over the period of its existence it has published 19,500 international standards recognized in lots of countries and in almost every field of technology and economics, except for the fields of telecommunication and electro-technical engineering which are linked to the International Telecommunication Union (ITU) and International Electro-Technical Commission (IEC). These standards provide specifications for the products and services as well as firm practices aimed at improving the overall economy.

The ISO consists of national standardizing organizations from more than 160 countries. ISO works together with the European Committee for Standardization. Thus, these standards can be applied both in Europe and in the rest of the globe.

There are different types of Standards:

The Standards allow to define a common set of definitions for international economic actors – Producers, Consumers, Carriers, etc. In addition it allows to clarify and harmonize the practices among parties. These standards are aimed at facilitating global trade, thus allowing for greater amount of operations which would in turn lead to an increase in wealth. Other than that they also make life easier in general. These standards are used as the documents of reference. Essentially it is a consensus accepted by the markets regarding the import- export activities. These standards may concern goods, services or management systems, for example the ISO 90001 concerning the quality management or the ISO 14001 about the Environmental Management.

The Standards shouldn’t be mixed up with the regulations. Regulations are established by the governmental of inter-governmental authorities and are mandatory, standards on the other hand as mentioned above are principles agreed upon by the parties and are not mandatory. Standards allow companies to satisfy the expectations regarding safety and quality of the products and services, by doing so companies may improve their products and services. Standards may support regulations if they are listed as references.

In order to successfully enter a market, you would have to follow all the standards. The companies are trying to make sure that the standards are consistent with their goals and needs. A company may take an interest in standardization in order to forecast what the markets will want in the future and to protect their goods services.

Thus standards contribute to the markets, allow to increase the overall levels of wealth in the world. Companies that comply with the standardization rules are more likely to succeed in the new market.