Guest Post: Deep sea salvage – raising TPP?

by | Mar 10, 2017 | Trade Working Blog

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Guest post from Tracey Epps, Trade Law Consultant, Chapman Tripp.

A meeting of Asia Pacific economies in picturesque Viña del Mar, Chile, 14-15 March, will consider the path forward for trade liberalisation in the Asia-Pacific region.   New Zealand along with the original signatories of the Trans Pacific Partnership (TPP) will be in attendance, along with China, South Korea and Colombia.

The US will be represented by their Ambassador to Chile.  The summit will provide an opportunity, among other things, for the TPP signatories to consider the Agreement’s future.

One option which has already been mooted is the idea of a TPP minus the US (potentially with the addition of other countries). I have previously suggested that the 11 TPP partners consider re-signing the Agreement as it stands, but agree not to enforce some of the more controversial provisions until agreed otherwise.

This could preserve TPP’s attractiveness to the US for future accession, while helping to address concerns about concessions made in return for access to the US market.

But let’s for a moment consider what a renegotiation would involve. For starters, the entry into force clause would require amending. A critical mass would most likely be desired, and this could be achieved in various ways, such as a revised GDP threshold, an explicit requirement for certain countries (e.g. Japan) to ratify, or a simple numerical threshold (e.g. ratification of five signatories).

But what of the substance of the Agreement?

There are some fairly obvious national interests reflected in the text and a renegotiation would likely involve removing or revising those provisions that most strongly reflect US interests. A starting list might include various provisions found in the Intellectual Property chapter (such as copyright, biologics, patent linkage, patent term extension and technological protection measures), the Health Care Transparency annex and the State-Owned Enterprises chapter. The list might also include the application of dispute settlement to the Labour and Environment chapters, the application of “investor state dispute settlement’ (ISDS) to investment authorisations and investment agreements, the design of the temporary safeguard measures provision and the provision for textiles and apparel emergency actions.

In addition, there would be the possibility of some signatories wanting to renegotiate provisions that appear mundane on the face of it but that have particular significance to them.

Then there is the question of market access. Is there any realistic chance that the more reticent signatories would agree to liberalise further or faster in the US’ absence, (and in doing so, put pressure on the US in any future accession negotiations), or is there a risk that the US’ absence would have the opposite effect?

In short, there would be many complexities to a renegotiation – in some cases countries may readily agree to remove or revise a provision, but it would not be so simple if a provision reflected more than US interests. This is not to suggest that a renegotiation ought not to occur, but it does speak to the importance of carefully defining any renegotiation agenda to ensure that we are not dragged into a quagmire from which we might only emerge in time to find that President Trump has been succeeded and the US is back in the game.

Raising TPP from its submerged state is no simple matter. All the better to get this work underway in a Chilean sea-side resort.

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