Import licenses are considered to be non-tariff barriers to trade when used as a way to discriminate against another country's goods in order to protect a domestic industry from foreign competition.
Licenses can be sold to importing companies at a competitive price, or simply a set fee.
However, it is argued that this allocation method provides incentives for political lobbying and bribery.
For example, if a business wishes to import agricultural products such as vegetables, then the government may be concerned about the impact of such importations of the local market and thus impose a restriction.
The Système Intégré de Gestion de Licenses (SIGL) is the European Union Directorate General for Trade's integrated IT system for the management of licences for imports of textiles, clothing, footwear, steel and wood to the EU.