30 January 2016
Do your homework Export NZ: The TPPA is the China FTA on Steroids!
‘Claims by Export NZ that the Trans-Pacific Partnership Agreement (TPPA) is basically no different from the NZ-China FTA
shows appalling ignorance of both agreements’, says University of Auckland law professor Jane Kelsey.
‘Presumably the corporate lobbies are trying to discredit the Labour Party, which negotiated the China FTA and has now
come out against the TPPA because of its impacts on regulatory sovereignty. Anyone familiar with the agreements knows
that Export NZ is plain wrong.’
Professor Kelsey notes that the China agreement does include many non-trade rules that extend the constraints on
governments that were introduced when the World Trade Organisation was created in 1995.
‘I was highly critical of those developments for that reason, but the TPPA makes the China deal pale into relative
insignificance’.
The starkest example is the intellectual property chapter. The China FTA simply affirms both countries’ obligations
under the WTO. The TPPA contains unprecedented new rules on marketing exclusivity for biologic medicines, extends
copyright for 20 years, imposes new rules on patents, restricts technology protection measures, and much more.
The investment chapter confers China-plus rights on the 1608 US corporations operating in New Zealand, plus those from
Japan, Singapore, Canada and elsewhere. These include:
· Access to use the TPPA’s investor-state disputes mechanism to deal with contractual disputes over mining and resource
concessions, PPP contracts, and contracts for public services like power, water and telecoms, even when the investor is
not alleging a breach of TPPA rules.
· The (weak) general exception provision does not apply to the investment chapter.
· Non-discrimination rules in the China agreement only apply after the investment is established, whereas the TPPA
covers pre-establishment.
· The Annex that interprets expropriation is more pro-investor than the China FTA, although that was itself more
pro-investor than the Australia New Zealand ASEAN FTA.
Professor Kelsey points out that China’s investors will now enjoy many of the benefits that the TPPA countries and their
corporations gain through the TPPA under the most-favoured-nation rule. This entitles China, and most other countries
with which New Zealand has FTAs, to any better rules provided to investors in subsequent agreements.
The TPPA also contains completely novel chapters on state-owned enterprises, e-commerce and regulatory coherence that
constrain future government’s regulatory sovereignty, and more extensive rules that for China in other chapters, such as
financial services and government procurement.
ENDS