most favored nation clause

most favored nation clause
A clause found in most treaties providing that the citizens or subjects of the contracting nations may enjoy the privileges accorded by either party to those of the most favored nations. The general design of such clauses is to establish the principle of equality of international treatment. The test of whether this principle is violated by the concession of advantages to a particular nation is not the form in which such concession is made, but the condition on which it is granted; whether it is given for a price, or whether this price is in the nature of a substantial equivalent, and not of a mere evasion.
The United States has generally taken the stand that reciprocal commercial concessions are given for a valuable consideration and are not within the scope of this clause. Whitney v. Robertson, 124 U.S. 190, 8 S.Ct. 456, 31 L.Ed. 386.
See also reciprocal trade agreements. A primary effect of "most favored nation" status is lower import tariffs or duties

Black's law dictionary. . 1990.

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  • most favored nation clause — A clause found in most treaties providing that the citizens or subjects of the contracting nations may enjoy the privileges accorded by either party to those of the most favored nations. The general design of such clauses is to establish the… …   Black's law dictionary

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  • most favored nation clause — section that contains information about most favored nation status …   English contemporary dictionary

  • most favored nation clause — The clause of a treaty between two nations under which either of the parties or its diplomatic or consular representative is entitled to all the rights and privileges of those of the nation most favored by a treaty made with it by the other party …   Ballentine's law dictionary

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  • most-favored-nation clause — a clause in a commercial treaty or contract by which each signatory agrees to give the other the same treatment that is or will be accorded any other nation. * * * …   Universalium

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