Anti-Diversion Clause

AAA

DEFINITION of 'Anti-Diversion Clause'

A regulation that prevents exported goods from going to destinations not approved by the government. In the United States, the Department of Commerce's Bureau of Export Administration requires commercially exported goods to be accompanied by a destination control statement saying that the goods are only authorized for export to certain locations and that U.S. law prohibits their diversion. The latter part of this statement is the anti-diversion clause.

INVESTOPEDIA EXPLAINS 'Anti-Diversion Clause'

The destination control statement and anti-diversion clause must appear on the invoice and ocean bill of lading or air waybill that accompanies the exported goods. The statement also certifies that to the best of the shipper's knowledge, the shipment is headed to its stated destination. National security, nonproliferation and foreign policy are some of the reasons why a country's government may be concerned with controlling its exports. In the United States, most exports of items on the Commerce Control List must contain a destination control statement.

RELATED TERMS
  1. Free Trade Area

    A group of countries that invoke little or no price control in ...
  2. Tariff

    A tax imposed on imported goods and services. Tariffs are used ...
  3. Trade War

    A negative side effect of protectionism that occurs when Country ...
  4. Most Favored Nation Clause

    A level of status given to one country by another and enforced ...
  5. Export

    A function of international trade whereby goods produced in one ...
  6. Import

    A good or service brought into one country from another. Along ...
RELATED FAQS
  1. What statements can be used on a Bill of Lading?

    One type of statement often found on a bill of lading is a statement of the condition of items being shipped. The statement ... Read Full Answer >>
Related Articles
  1. Economics

    The Dark Side Of The WTO

    The World Trade Organization has its share of detractors. Find out why this international entity has such harsh critics.
  2. Personal Finance

    What Is International Trade?

    Everyone's talking about globalization, so we explain what is it and why some oppose it.
  3. Economics

    Globalization: Progress Or Profiteering?

    Proponents of globalization argue that it helps the economies of developing nations and makes goods cheaper, while critics say that globalization reduces domestic jobs and exploits foreign workers. ...
  4. Economics

    What Is The World Trade Organization?

    The WTO sets the global rules of trade. But what exactly does it do and why do so many oppose it?
  5. Economics

    NAFTA's Winners And Losers

    Read on to find out who this free-trade agreement helped, and who it hurt.
  6. Personal Finance

    What Is The Bank For International Settlements?

    Get the scoop on the structure and functions of the oldest global financial institution.
  7. Mutual Funds & ETFs

    Want to Go Long Natural Gas? Eye the UGAZ ETN

    Is UGAZ the best way to play natural gas? Maybe not.
  8. Chart Advisor

    These Oil Service Stocks Are Ready For A Move Higher

    In the oil services sector, active traders have been trying hard to establish a floor and the double bottom pattern that is appearing on the chart suggests that a short-term reversal could be ...
  9. Economics

    What is the Income Effect?

    In economics, the income effect is the change in the consumption of goods caused by a change in income, whether income goes up or down.
  10. Economics

    Asian LNG Prices: Not Likely To Rise Anytime Soon

    Asian LNG prices could stay low for an extended period of time, due to low oil prices, less demand and new LNG-producing projects on various continents.

You May Also Like

Hot Definitions
  1. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  2. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
  3. Market Value

    The price an asset would fetch in the marketplace. Market value is also commonly used to refer to the market capitalization ...
  4. Preference Shares

    Company stock with dividends that are paid to shareholders before common stock dividends are paid out. In the event of a ...
  5. Accrued Interest

    1. A term used to describe an accrual accounting method when interest that is either payable or receivable has been recognized, ...
  6. Absorption Costing

    A managerial accounting cost method of expensing all costs associated with manufacturing a particular product. Absorption ...
Trading Center