Here are some common terms and definitions to assist you in doing business internationally.

Offset - Compensatory, reciprocal trade agreements for industrial goods and services as a condition of military-related export sales and services. It is also used in the purchase of civilian aircraft and has become the norm in the aerospace/defense sector. Offset is divided into two categories, Indirect Offset and Direct Offset.

Indirect Offset - Involves goods and services unrelated to the aerospace/defense material being sold.

Direct Offset - Involves compensation in related goods and usually involves some form of co-production, license or joint venture.

Countertrade - Refers to the reciprocal and compensatory trade agreements involving the purchase of goods or services by the seller from the buyer of his product, or arraignments whereby the seller assists the buyer in reducing the amount of net cost of the purchase through some form of compensatory financing.

Barter - The exchange of goods or services of equivalent value without the use of currency.

Counterpurchase - This is an agreement whereby the initial exporter buys or undertakes to find a buyer for a specified amount or value of unrelated goods from the initial importer during a specified time period.

Technology Transfer - The transfer of technology mandated as part of a countertrade or offset agreement, other than coproduction or license production. It may be in the form of research and development, technical assistance and training, or patent agreements between manufacturers. This is central to many Third World enterprises, public and private, and is the focus of a large number of countertrade and offset deals.

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