Most Favored Nation Treatment 2
Most Favored Nation Treatment 2 : A commitment that a country will extend to another country the lowest tariff rates it applies to any other country. All contracting parties undertake to apply such treatment to one another under Article I of GATT. When a country agrees to cut tariffs on a particular product imported from one country, the tariff reduction automatically applies to imports of this product from any other country eligible for most-favored nation treatment. This principle of nondiscriminatory treatment of imports appeared in numerous bilateral trade agreements prior to establishment of GATT. A country is under no obligation to extend MFN treatment to another country unless both are bilateral contracting parties of the General Agreement on Tariffs and Trade or MFN treatment is specified in a bilateral agreement
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