Australia has become the 6th country to ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a trade deal between 11 Pacific nations. Australia’s ratification followed swiftly after Canada deposited its official notice of ratification on 24th October, joining Japan, Mexico, New Zealand and Singapore. The agreement will now come into force on 30th December, 60 days after Australia’s ratification.
The 11 signatory economies represent approximately 16 percent of global economic output and 500 million people. It is anticipated that a number of the remaining 5 signatory states (Brunei, Chile, Malaysia, Peru and Vietnam) will be in a position to ratify the agreement over the next months. Japan has expressed interest in having other countries join the agreement and earlier this month, Japanese Prime Minister Shinzo Abe stated his interest in seeing the United Kingdom join following its departure from the European Union.
The CPTPP has emerged from the ashes of the earlier TPP following America’s withdrawal from the treaty. As discussed in our earlier blog posts here and here, a number of provisions that were in the original TPP have been suspended in the CPTPP. Notably, this includes certain provisions on investor-state dispute settlement (ISDS), meaning that the scope of the ISDS mechanism has narrowed. New Zealand has also signed side letters to exclude or limit compulsory ISDS with five signatories to the CPTPP.
For more information please contact Brenda Horrigan, Partner, Alastair Henderson, Partner, Chris Hunt, Partner, Andrew Cannon, Partner, or your usual Herbert Smith Freehills contact.