Principal Supplier

Summary of Principal Supplier

A nation that serves as the major source of supply to another country for a specific product.

(Main Author: William J. Miller)

Principal Supplier and the GATT Policy Negotiations

In relation to the GATT Policy Negotiations, Christopher Mark (1993) provided the following explanation and/or definition of Principal Supplier: The country that accounts for the largest portion of total GATT trade in a product imported into a given country. In multilateral GATT negotiations, a country offering to reduce import duties or other barriers on a particular item will generally expect the principal supplier of that item to reciprocate by offering reductions of barriers on some other item. Any tariff concessions exchanged through such negotiations are extended automatically to all other countries, which enjoy MFN status. The principal supplier –along with any country holding initial negotiating rights –has first claim to negotiate compensation in the event that an importing country raises a tariff above its bound rate (seebinding and modification). See also substantial supplier.