News from the UK on the terms agreed for the future free trade agreement with New Zealand marks the government’s second success in negotiating tailor-made free trade agreements since the UK’s withdrawal from the ‘EU.
The agreement in principle with New Zealand was reached on Wednesday October 20 after 16 months of negotiations. It precedes competing EU negotiations. The main trade elements of this agreement include the elimination of tariffs on 97.6% of tariff lines, better access to services and digital markets, the creation of investment opportunities, as well as the protection of agricultural standards, high supply and environmental standards.
This tentative agreement reflects the step taken by the United Kingdom in negotiations with Australia in June 2021, and brings the United Kingdom closer to joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a bloc trade of 11 nations and a GDP of £ 8.4 trillion.
Recognizing the importance of the advanced technology market, the tentative agreement marks deeper cooperation on digital commerce and seeks to stimulate collaboration with the aim of fostering new innovations. DWF is a leader in this industry through our Mindcrest division and welcomes the focus on innovation and digital commerce.
Burning issues for business will include the immediate removal of all tariffs on a range of New Zealand export products such as apples, wine and honey, as well as UK export products such as drinks, clothing, footwear, automobiles, ships and machinery. In contrast, tariffs on sensitive agricultural products such as lamb, beef and dairy products will be phased out and subject to tariff rate quotas.
The agreed rules also provide for fair trade remedies and a safety valve – a temporary safeguard mechanism. Temporary safeguard is a way of responding to surges in imports of particular goods in order to protect the domestic industry producing competing goods. This provision responds to concerns reported by sensitive sectors such as beef, lamb and dairy products.
Foreign investors will benefit from the increased domestic security screening thresholds. The future agreement will lead to the opening of markets for professional services, including financial and legal services, and a commitment to reach “net zero” and implement the Paris Agreement. The agreement will promote trade in environmental goods, services and investments, and much more.
As a legal firm active in Indo-Pacific markets, DWF welcomes this news, which will further strengthen our ties with the region.
We will take advantage of the opportunities offered by the provision of legal services to remove the obstacles faced by UK, Australian and New Zealand lawyers providing legal advisory services in their respective jurisdictions and to increase collaboration between competent authorities.
With a presence across the UK as well as Brisbane, Sydney, Gold Coast, Melbourne and Singapore, DWF is uniquely positioned to help local and international clients navigate the rules and ramifications of UK trade agreements. and to enable them to take advantage of the opportunities they present.
We welcome the priority the government has placed on CPTPP membership, which we see as a key step in giving UK and Commonwealth business a boost through the vision of a Great Britain. global.
Nestled between the World Investment Summit and COP26, this tentative agreement heralds ongoing developments in international forums as countries continue to recover from the pandemic. Members of the DWF International Trade team have over 30 years of combined experience in trade policy, free trade agreements and trade remedies. The DWF team would be happy to advise and assist any stakeholder with regard to market access strategies, trade remedies and direct representations to the relevant authorities. We would be happy to provide any further insight or clarification on the tentative agreement, available at UK-New Zealand FTA negotiations: tentative agreement – GOV.UK (www.gov.uk).