GATT (General Agreement on Tariffs and Trade)
The previous GATT (General Agreement on Tariffs and Trade) was instituted in 1947 after the Second World War. This has now been replaced by the World Trade Organization (WTO), following eight years of the Uruguay Round negotiations (1986 - 1994).
The Final Act of the Uruguay Round includes the General Agreement on Tariffs and Trade (GATT) 1994 as one agreement out of twenty. The Final Act of the Uruguay Round sets out the establishment of the World Trade Organisation (WTO), as agreed by its members in Marrakesh, 15 April 1994.
The WTO web site explains that prior to the founding of the WTO, the GATT played a "de facto role - [that] - was always ad hoc, without a proper legal foundation. International law did not recognize GATT as an organization".
The general thrust of GATT 1994, established within the WTO, is to constrain and direct domestic economic policy-making so as to accord with the new GATT rules. Two key rules are:
The new GATT rules affect domestic policies in a wide range of areas, including subsidies, foreign exchange balancing attempts, patent laws, and the like. All these can no longer be determined primarily by domestic requirements. While there are exceptions made for the least developed countries, most developing countries will find that their degree of integration into world markets has substantially increased as a result of the new international trade regime.