We study how import protection affects relationship-specific investments, sourcing, organisational choice and welfare. In a property rights model, we show that a tariff on intermediate inputs that discriminates in favour of investing firms increases their bargaining surplus and their marginal returns on investment. Thus, a tariff may improve social welfare by mitigating hold-up problems facing domestic firms. However, a tariff may prompt inefficient organisational choices if foreign suppliers are more productive than domestic suppliers, or if integration costs are low. Tariff revenue, which is external to firms, drives a wedge between the private and social gains to offshoring and integration.