-------------- R -------------- RBPs. See Restrictive Business Practices. RECIPROCAL TRADE AGREEMENTS ACT OF 1934. See Most-Favored-Nation Treatment; and Trade Agreements Act of 1934. RECIPROCITY. The practice by which governments extend similar concessions to each other, as when one government lowers its tariffs or other barriers impeding its imports in exchange for equivalent concessions from a trading partner on barriers affecting its exports (a "balance of concessions"). Reciprocity has traditionally been a principal objective of negotiators in GATT "Rounds." Reciprocity is also defined as "mutuality of benefits," "quid pro quo" and "equivalence of advantages." GATT Part IV (especially GATT Article XXXVI) and the "Enabling Clause" of the Tokyo Round "Framework Agreement" exempt developing countries from the rigorous application of reciprocity in their negotiations with developed countries. See also Competitive; Concession; Efficiency; Enabling Clause; Framework Agreement; General Agreement on Tariffs and Trade; Most-Favored-Nation Treatment; Negotiations; Principal Supplier; Round; Special and Differential Treatment; and Welfare. REGRESSIVE TAXATION. See Indirect Tax. REINSURANCE. The shifting by agreement (known in the insurance industry as a treaty) of part of the risk (or "exposure") of the original insurer (the ceding company) to another insurer (the reinsurer). Sometimes a reinsurer will, in turn, pass on part of its risk to another reinsurer through a process known as retrocession. International reinsurance is important to developed and developing countries alike. See also Insurance; and Risk. RELIEF. See Escape Clause; Import Relief; and Safeguards. REPRISALS. See Retaliation. REQUEST LIST. A list submitted by a country to a trading partner at an early stage of trade negotiations identifying the concessions it seeks through the negotiations. See also Concession; Negotiations; Offer List; and Round. RESERVE CURRENCY. A national currency, such as the dollar or pound sterling, or international currency such as Special Drawing Rights, used by many countries to settle debit balances in their international accounts. Central banks generally hold a large portion of their monetary reserves in reserve currencies, which are sometimes called "key" currencies. See also Currency; Mercantilism; and Special Drawing Rights. RESERVES. See Mercantilism; and Reserve Currencies. RESIDUAL RESTRICTIONS. Quantitative restrictions maintained by governments since they became Contracting Parties to GATT, despite the general GATT prohibition against such measures. See also Grandfather Clause; Protocol of Provisional Application; and Quantitative Restrictions. RESTITUTIONS. Payments to agricultural exporters in the European Community under the Common Agricultural Policy to cover the difference between internal and world market prices. See also Common Agricultural Policy; Dual Pricing; European Community; Export Subsidies; Threshold Price; and Variable Levy. RESTRAINTS. See Non-Tariff Barriers; Liberalization; and Tariffs. RESTRICTIVE BUSINESS PRACTICES (RBPs). Acts or behavior of enterprises -- whether private or government-controlled -- that abuse a dominant economic position and limit access to markets or otherwise unduly restrain competition. Such practices include collusion to fix export or import prices, allocate markets or customers, practice discriminatory pricing, set prices at which export goods can be resold, or otherwise restrict imports and exports. A non-binding (or "voluntary") code of conduct negotiated in UNCTAD -- formally called the "Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices" -- lists business practices to be avoided and recommends steps that enterprises and governments should take to discourage such activity. See also Anti-Trust; Cartel; Market Access; Monopoly; and Unfair Trade Practices. RETALIATION. The suspension of concessions or other obligations under a trade agreement, or the imposition of other barriers to trade, by a government in response to the violation of a trade agreement or the imposition of other unfair trade barriers by another government. Section 301 of the Trade Act of 1974, as amended by sections 1301-1303 of the Omnibus Trade and Competitiveness Act of 1988, provides the domestic legal authority in the United States to impose retaliatory measures in response to trade agreement violations or other unjustifiable, unreasonable or discriminatory foreign trade practices that burden or restrict U.S. commerce. Such authority includes the authority to suspend trade agreement concessions; impose duties or other import restrictions; impose fees or restrictions on services; enter into agreements with the subject country to eliminate the offending practice or to provide compensatory benefits for the United States; and restrict service sector authorizations. The actions may be taken against all countries or solely against the subject country. Most actions may be taken against any goods or economic sectors, without regard to whether the goods or economic sectors were the subject of the investigation. See also Beggar-Thy-Neighbor Policy; and Tariff Act of 1930. RETROCESSION. See Reinsurance. REVERSE PREFERENCES. Tariff advantages once offered by developing countries to imports from certain developed countries that granted them preferences in turn. Reverse preferences characterized trading arrangements between the European Community and some developing countries (the "ACP" countries) prior to the advent of the Lome Convention. See also ACP Countries; European Community; Generalized System of Preferences; Lome Convention; and Preferences. RIGHT OF ESTABLISHMENT. A basic concept in bilateral investment treaties is that one party to the agreement will permit nationals and companies of the other party to establish (and maintain) investments on a non-discriminatory (national/most-favored-nation treatment) basis. A government will not place any special obstacles (e.g., a screening process, equity limitations) in the way of a foreign investor making an investment; that investor need comply only with the requirements placed on any other investor in that sector. See also Bilateral; Bilateral Investment Treaty; and Multilateral. RISK. Speculative risk involves the possibility of profit or loss, depending upon the success or failure of the financial or commercial venture in question. Banks also accept risks when they make loans, which may either be repaid or defaulted. Capital investors are sometimes referred to as risk bearers; their investments may be considered "venture capital" if they appear to be subject to considerable risk, as in the case of new enterprises, or "security capital" if they appear to be subject to little risk. Pure risk is involved when there is no possibility of gain, but only the possibility of loss. Insurance is concerned with pure risks, not speculative risks. See also Credit; Entrepreneur; Insurance; Interest; Loan; Profit; and Reinsurance. ROAD TAX. A tax imposed by a government on the operation of motor vehicles, usually based on weight or engine displacement. Some have the effect of discriminating in favor of one type of vehicle over another. See also Discrimination; Excise Tax; Non-Tariff Barriers; and Tax. ROUND. A cycle of multilateral trade negotiations under the aegis of GATT, culminating in simultaneous trade agreements among participating countries to reduce tariff and non-tariff barriers to trade. Eight "Rounds" have been completed thus far: Geneva, 1947-48; Annecy, France, 1949; Torquay, England, 1950-51; Geneva, 1956; Geneva, 1960-62 (the Dillon Round); Geneva, 1963-67 (the Kennedy Round); Geneva, 1973-79 (the Tokyo Round); and Geneva, 1986-1993 (the "Uruguay Round"). See also Dillon Round; General Agreement on Tariffs and Trade; Kennedy Round; Liberalization; Multilateral Trade Negotiations; Negotiations; Offer List; Peril Point; Reciprocity; Request List;Tokyo Round; Trade Agreement; Trade Agreements Act of 1934; Uruguay Round; and Williams Commission.