July 22 (Reuters) - Contingency measures, or legal "safety valves", allowing countries to suspend or waive trade commitments, can damage the global economy if abused for protectionist purposes, the World Trade Organisation said on Wednesday.
The following lists and explains six such measures.
SAFEGUARDS
Allow a WTO member to impose temporary tariff increases or quotas to counter a sudden surge in imports or fall in prices.
Safeguards allow policy-makers to agree to higher levels of commitments than without such flexibility, because they will allow them to react to unforeseen economic events.
But such measures have to be strictly temporary to work.
The negotiation of a "special safeguard mechanism" to enable subsistence farmers in poor countries to cope with a flood of cheap imports that could destroy their livelihoods proved a stumbling block at negotiations on a new trade deal last July.
ANTIDUMPING
Allows a country to impose compensatory duties on imports that are "dumped" -- sold for less than they cost at home -- if that injures businesses in the importing countries.
Can be renewed.
The most widely used of the flexibilities.
Typically sought by companies suffering from cheap imports, and targets companies in the exporting country.
Under WTO rules should not penalise the exporter, simply even out the prices.
But the technicalities often give rise to claims of foul play and antidumping is the cause of many trade disputes.
Economists say it can also hurt consumers in the importing country -- by depriving them of cheap goods -- as well as companies that need to import components.
COUNTERVAILING DUTIES
Imposed by countries to compensate for subsidies in another country. Unlike antidumping, it targets a foreign government, not foreign companies.
Often countervailing subsidies serve only to help producers in the affected sector rather than the economy as a whole.
There is little to suggest that they discourage subsidies.
RENEGOTIATION OF COMMITMENTS
Some countries may prefer to renegotiate their trade commitments if they have a problem with imports in a particular sector, any pay compensation -- typically agreeing concessions in another area.
This may be the case with developing countries that do not have the administrative capacity to carry out antidumping investigations and implement the measures.
But even rich countries may adopt this approach for policy reasons. The United States withdrew its commitments on online gambling and is negotiating with other countries to compensate them in other areas.
RAISING TARIFFS TO MAXIMUM AGREED WTO CEILINGS
WTO members typically negotiate maximum levels, or ceiling, for tariffs. They retain the right to apply tariffs below the level of these bound rates, moving them up and down as the economy requires.
For instance a country may cut tariffs on grain to let in food if there is a food shortage, then raise them again to the agreed bound rate when local farmers can supply the market.
Such increases within the bound rates are one of the main ways that developing countries -- who cannot afford big bailout packages or subsidies in the crisis -- can restrict trade while staying within the rules.
The WTO estimates that many developing countries could raise 70-90 percent of tariffs by 15 percentage points without violating WTO commitments.
EXPORT TAXES
Allow countries to provide industry with a cheap source of raw materials, or consumers with plentiful supplies of goods such as food in a shortage.
Can also be imposed to raise government revenue or for environmental reasons.
Most WTO members can impose export taxes as long as they do so in a way that does not discriminate among other members -- the "most favoured nation" principle. But some recent members including China accepted restrictions on export taxes in their accession agreement.