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Generalized System of Preferences Rules

Generalized System of Preferences Rules

  • GSP Rules are unilateral. This means that the donor country set terms and conditions that the beneficiaries will meet in order to benefit from its scheme. 
  • In developing their individual GSP Schemes Donor Countries should ensure that the GSP Rules formulated are: 
    • Generalized; 
    • Non-discriminatory; and 
    • Non-reciprocal 
  • The rules should also adhere to all the other principles that guide the development and application of Rules of Origin. 
  • The programs of most GSP-granting countries place certain conditions on the nonreciprocal preferences. These include:
    • Excluding certain countries
    • Determining specific product coverage; 
    • Determining rules of origin governing the preference; 
    • Determining the duration of the scheme; 
    • Reducing preferential margins accruing to developing countries by continuing to lower tariffs as a result of multilateral, bilateral, and regional negotiations; 
    • Preventing the concentration of benefits among a few countries; 
    • Including safeguard mechanisms or “escape” clauses to protect import-sensitive industries; and 
    • Placing caps on the volume of duty-free trade entering under their program. 

Student Activities

  • Activity 1

    • Visit 
    • Download and read the following documents:
    • Quantifying the Benefits Obtained by Developing Countries from the Generalized System of Preferences (UNCTAD/ITCD/TSB/Misc.52)
    • Trade Preferences for Least Developed Countries: An Early Assessment of Benefits and Possible Improvements (UNCTAD/ITCD/TSB/2003/8)


    • Provide a summary of the benefits of the GSP to the developed countries
    • Discuss the challenges faced in the implementation of the GSP

Activity 2


  • Identify the Generalized System of Preferences Schemes that each of the following EAC Members participate in: Burundi, Kenya , Uganda, Tanzania, Rwanda & South Sudan


  1. Explain the benefits of the GSP Schemes
  2. Discuss the rules of the GSP Schemes
  3. Discuss the challenges developing countries face in participating in multiple GSPs