Trade-Related Investment Measures (TRIMS)
Examples of these restrictions include local content requirements (which require that locally-produced goods be purchased or used), manufacturing requirements (which require the domestic manufacturing of certain components), trade balancing requirements, domestic sales requirements, technology transfer requirements, export performance requirements (which require the export of a specified percentage of production volume), local equity restrictions, foreign exchange restrictions, remittance restrictions, licensing requirements, and employment restrictions. These measures can also be used in connection with fiscal incentives as opposed to requirement. Some of these investment measures distort trade in violation of GATT Article III and XI, and are therefore prohibited.
Performance requirements are one kind of so-called "host country operational measures and can be divided into three categories: the first category consists of those that are explicitly prohibited by the WTO TRIMS Agreement. The second includes requirements that are explicitly prohibited, conditioned or discouraged by inter-regional, regional or bilateral (but not by multilateral) agreements; and the third category covers requirements that are not subject to control through any international investment agreement (IIA).
