Wheels Still Turning on the TPP-11

In August two bills were presented to the Lower House to implement our obligations under the TPP-11; they were referred to the Senate Committee for report by 10th October.


The new TPP is officially called Comprehensive and Progressive Agreement for Trans-Pacific Partnership and informally known as the TPP-11, after the United States pulled out of the original 12-country bloc earlier this year. Still in it are Australia, New Zealand, Canada, Mexico, Peru, Chile, Japan, Brunei, Singapore, Malaysia and Vietnam, covering 13% of the world’s economy.

On 23rd August the Minister for Trade, Tourism and Investment presented to the House of Representatives two bills which implement Australia’s obligations under the TPP-11. The bills were referred to the Senate Legal and Constitutional Affairs Legislation Committee for inquiry and report by 10 October 2018.

Doubts on the passage of enabling legislation have been resolved as the legislation to implement the TPP-11 (including amendments to our customs legislation) have now passed through the Senate, as evidenced in the latest media release by the Prime Minister and the Minister for Trade and Tourism.

Commencement of the TPP-11 is still not clear. It requires six of the eleven contracting parties to confirm they have undertaken domestic ratification. Australia will become the fourth to have ratified the deal, so it then requires two more countries to ratify it, which will then commence once diplomatic formalities have been confirmed. That could be soon – even earlier than the next round of Japan–Australia Economic Partnership Agreement (JAEPA) tariff reductions.

The text of trade agreements such as TPP-11 remains secret until the moment they are signed. After that it’s then tabled in parliament and reviewed by a parliamentary committee. But the parliament can’t change the text. It can only approve or reject the legislation before it. Furthermore, that legislation doesn’t cover the whole agreement, merely those parts of it that are necessary to do things such as cut tariffs. And some decisions will be beyond our control. In addition to the normal state-to-state dispute processes in all trade agreements, the TPP-11 contains so-called Investor-State Dispute Settlement (ISDS) provisions that allow private corporations to bypass national courts and seek compensation from extraterritorial tribunals if they believe a change in the law or policy has harmed their investments.

In the midst of internal misgivings about the TPP-11, the federal opposition has decided to endorse it and then try to negotiate changes if it wins government. In government it has promised to release the text of future agreements before they are signed, and to subject them to independent analysis. And it says it will legislate to outlaw ISDS and temporary labour provisions in future agreements.

Should we have a change of government at the next election, a new administration would have to negotiate side letters with each of the other TPP governments. If the TPP-11 gets through the Senate, however, whichever side wins an election is likely to be stuck with it.

Sources: dfat.gov.au/trade; theConversation.com; rigbycooke.com