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The Preamble sets out the philosophical underpinnings of the Agreement. This includes both countries recognising the importance of strengthening their economic partnership to bring economic and social benefits. Both countries are aware that closer economic partnerships can play an important role in promoting sustainable development (as is also promoted through the parallel arrangements on labour and environment). They recognise the significance of good corporate governance, will build on their rights, obligations and undertakings under the WTO and are mindful of their commitment to APEC goals.
Both governments have the right to regulate in order to meet national policy objectives.
This provision sets out the agreed objectives of the CEP, which include strengthening the trade and economic relationship, liberalising trade and investment, encouraging cooperation in areas of mutual interest, improving efficiency and competitiveness of trade sectors and facilitating trade and investment.
Definitions are listed here if they are used in more than one Chapter in the Agreement.
This Chapter applies to trade in all goods between the two countries.
The two countries will give national treatment to each other’s goods. The national treatment obligation means that imports from the other country must be treated no less favourably than the same or similar domestically produced goods once they have passed Customs.
This Article outlines rules for the elimination of customs duties (tariffs) on goods traded between New Zealand and Thailand which meet the rules of origin Chapter 4, below.
Many customs duties will be eliminated when the Agreement enters into force. Others will be phased down to zero over varying periods. The two countries have set out their tariff elimination timetables in an Annex to this Chapter (Annex I).
Annex 1 also sets out the timetable for phasing out Thailand’s tariff quotas. This Article requires that these tariff quotas be administered in a way that is transparent and that does not exacerbate the trade-restricting effect of the quota. The countries must cooperate in reviewing the procedures for the administration of tariff quotas.
Both countries have the right to ask the other for faster elimination of customs duties, and either may choose to reduce or eliminate its tariffs more quickly than provided for in its Tariff Schedule.
Any fees and charges either country imposes in connection with trade under the CEP other than (a) customs duties and internal charges or (b) anti-dumping or countervailing duties must be limited to the approximate cost of the services rendered and must not represent indirect protection.
This Article commits the two countries to work towards the elimination of agricultural export subsidies in the WTO. Consistent with their WTO rights and obligations, both countries have agreed not to introduce or maintain any agricultural export subsidy on goods exported to each other. The Article also provides for bilateral consultations where a country thinks an action of the other country has the effect of providing an export subsidy on an agricultural good.
Except where allowed by WTO rules or under other provisions of this Agreement, neither country will take measures to restrict bilateral imports or exports. Any permitted non-tariff measures will be transparent and will not be aimed at creating unnecessary obstacles to trade.
The Chapter aims to simplify and harmonise customs procedures and to ensure they are applied between the two countries in a way that facilitates trade.
The Chapter applies to customs procedures for clearing goods that are traded between the two countries.
Definitions relevant only to the Customs Chapter are listed.
Provides for the customs administrations to enter into a Cooperative Arrangement. Confidential information will be protected.
Both countries will maintain customs procedures that facilitate trade and reflect international standards and will review these periodically.
The two sides will follow the guidelines of the World Customs Organisation in the clearance of express consignments.
When determining the value of goods, the two countries will comply with the relevant WTO rules.
Both countries must cooperate in customs law enforcement activities.
Each country must provide the other with advance notice of any significant modification to customs laws, regulations and policies.
Each country will provide avenues for appeals against decisions taken by customs administrations.
The two sides have committed to provide rulings on the tariff classification of goods before they are exported.
Where there are significant differences with respect to the application of this Chapter or the Chapter on Rules of Origin, either customs authority may request consultations.
The Customs Administrations must consult on any procedures employed to secure the flow of trade between the two countries.
Electronic procedures shall be adopted as soon as possible for all reporting requirements.
Countries will facilitate clearance of low-risk goods and focus more on high-risk goods.
Both countries must make publicly available customs administration laws, regulations and administrative procedures. Both countries must also designate an enquiry point.
Terms relevant only to the Chapter on Rules of Origin are defined.
The rules of origin determine which goods qualify as originating goods and therefore receive tariff preference under the Agreement.
Originating goods of a country are those that:
The principal requirement for determining whether goods containing third country input material qualify as originating is whether that input has undergone a specified change in tariff classification as a result of production processes occurring in the territory of either country. This is known as a “change in tariff classification” approach to determining origin. The required change for each product is set out in Annex 2.
The change in tariff classification requirement is not met if the goods have only undergone minimal processing such as freezing and cutting.
Goods containing input materials from third countries must satisfy the requirements in the Chapter unless those inputs account for less than 10% of the FOB value of the goods.
For textiles, clothing, footwear and carpet, the good being exported must also contain a defined level of local (ie New Zealand or Thai) content as a proportion of the overall FOB value of the good. This is known as a “regional value content” requirement. The regional value content is set at 50% of the overall FOB value.
The provision requires costs to be recorded along the lines of generally accepted accounting principles.
Each country may require a declaration as to the origin of a good. There is no single mandatory requirement as to who should sign the declaration. A country can request additional evidence to verify the preference claimed where there are doubts. If such evidence is not provided the non-preferential tariff rate will apply.
Producers, exporters and importers must retain records relating to the origin of a good for which preferential tariff treatment has been claimed.
This Article sets out action that may be taken to verify the origin of goods for which preferential treatment is sought, including requesting written information and through visits to factories and premises.
The importing country may suspend the application of the tariff preference during an investigation into origin verification. A claim for tariff preference may be denied if a good does not meet the origin requirement or if the producer or exporter/importer fails to comply with the relevant requirements.
Both countries retain their rights and obligations under the relevant WTO provisions.
Both countries retain their rights and obligations under the relevant WTO provisions.
Both countries retain their rights and obligations under the relevant WTO provisions. If either country applies global safeguards, it may exclude from the scope of those measures imports from the other country if those imports are not a cause of serious injury.
Outlines definitions used in the safeguard provisions of this Chapter.
This Article allows each country to suspend or reverse the reduction in tariffs under the Agreement in defined circumstances. For safeguard measures to be justified, increased imports resulting from the reduction or elimination of customs duties under the CEP must be causing or threatening to cause serious injury to the domestic industry which produces a like or competitive product.
These transitional safeguard measures may be imposed initially for up to two years with the possibility of a one year extension. The total duration of a transitional safeguard measure is therefore limited to three years. A safeguard measure may not be applied again on the same good until three years after the termination of a previous safeguard measure. All safeguard measures must terminate within two years of the tariff being removed on a particular product. A country applying a safeguard measure for more than a year must liberalise the measure at regular intervals.
A transitional safeguard measure can be applied only following an investigation by the country’s competent authorities into the impact of increased imports on the industry concerned. The Article specifies the economic variables to be addressed by such an investigation. There will be scope for interested parties to present their views to the investigating authority.
In highly unusual and critical circumstances where delay would cause damage that would be difficult to repair, a country may impose safeguard measures provisionally for up to 120 days pending the results of a full investigation. This Article outlines the factors to be considered in determining whether there are unusual and critical circumstances.
This Article sets out the requirements for notification and consultation when a safeguard investigation is initiated and at other intervals in the investigation process.
If a safeguard measure is extended for a period longer than two years, compensation is payable to the other country in the form of substantially equivalent concessions. The nature of such compensation is to be determined through bilateral consultations.
Special safeguards may be applied to sensitive agricultural products listed in Annex 3.
Special safeguard action on these products is triggered when a specified volume of imports is exceeded in a given calendar year. There is no requirement to demonstrate injury to local industry. When the specified volume is exceeded, the importing country is allowed to impose customs duties at a higher level on imports for the remainder of that year. This level will not exceed the tariff rate on 1 June 2004.
Special safeguards must be applied in a transparent manner including through publishing import volume figures in a readily accessible form.
Supplies of the product that are already on route on the basis of a contract settled before the maximum volume level is reached will be exempted from the higher duties but will be counted against the following year’s volume.
The special safeguards regime will be reviewed within three years of entry into force of the Agreement. If either country enters into an agreement with a third country which does not provide for special safeguard measures on a product included in Annex 3, the two countries will enter into consultations on withdrawal of that product from Annex 3.
The Chapter aims to uphold the WTO SPS Agreement, to facilitate bilateral trade and to strengthen cooperation and collaboration while protecting human, animal or plant life or health.
The Chapter applies to all SPS measures that affect trade between New Zealand and Thailand. There is a specific provision relating to food standards that acknowledges that a food standard can be either an SPS measure or a technical barrier to trade (TBT) measure and that under international law different disciplines apply. However, for administrative ease, should there be a trade issue regarding food standards, the notification and consultation mechanisms in the SPS Chapter will be used.
Outlines definitions used in the Chapter.
Each country reaffirms its existing commitments under the WTO SPS Agreement. Both countries are free to implement measures they deem necessary to protect human, animal or plant life or health.
This Article requires both Parties to promote communication between their respective SPS authorities. Contact points must be nominated. Notice must be provided as far in advance as practicable of proposed changes to SPS measures and food standards affecting trade between New Zealand and Thailand.
If there is an urgent problem, a country can take any measures necessary to protect human, animal or plant life or health. In doing so, the other country must be given notice of this change within 1 day of the change coming into effect.
This Article emphasises cooperation between the countries where imported consignments of goods are not in compliance. The Article encourages the Parties to resolve the non-compliance problem with minimal disruption to trade.
Both countries have agreed to enhance cooperation and consultation on SPS matters to improve understanding of each country’s measures and regulatory systems, resolve any concerns about specific SPS measures or food standards and resolve any technical and scientific issues that arise. There are two mechanisms established for this purpose: the Joint SPS Committee (which can establish technical working groups as required) and a provision for consultations to address particular measures affecting trade between the countries.
Confidential information, as defined by each country, is protected.
If matters are not able to be resolved through consultations, they may be forwarded to the CEP Joint Commission for consideration. Chapter 17 on dispute settlement does not apply to this Chapter.
Sets out definitions of terms used in this Chapter.
The cost of complying with technical regulations can constitute as significant a barrier to trade as tariffs. The aim of this Chapter is to facilitate trade through minimising the impact on trade of technical barriers.
This Chapter applies to standards, technical regulations and conformity assessment procedures that affect trade in goods. Both countries affirm their rights and obligations under the WTO Technical Barriers to Trade (TBT) Agreement. Both countries retain the right to take measures as may be necessary in situations where there is an immediate risk to health, safety or the environment.
The Chapter generally applies to all goods traded between the countries irrespective of their origin.
This Article promotes work towards harmonisation of technical regulations between New Zealand and Thailand. Both countries are also encouraged to recognise the other’s technical regulations as equivalent to their own. Where such recognition is not accorded, an explanation must be provided.
This Article makes provision for conformity assessment procedures (i.e. a procedure to ensure a product meets the appropriate standard or regulation of the other country) to be made compatible to the greatest extent practicable. Both countries are encouraged to accept the results of each other’s conformity assessment procedures. Where these are not accepted, an explanation must be provided.
Provision is made for bilateral cooperation in the area of technical barriers to trade, including through the designation of contact points and key advisers in regulatory agencies, technical consultations, work programmes, and arrangements to implement agreed outcomes.
Provides for substantive negotiations on trade in services between the two countries in three years’ time. Pending the conclusion of these negotiations, interim measures on temporary entry for New Zealand business people to Thailand are provided for in an exchange of letters.
This Chapter aims to encourage and promote the open flow of investment through transparent rules and cooperation. It also provides for the protection and security of investments.
Relevant definitions that apply to this Chapter only are listed. The benefits of the commitments in the specific sectors in the Annexes are confined to New Zealand citizens. Permanent residents are, however, able to obtain benefits under other parts of the Chapter.
The Investment Chapter excludes portfolio investment, applying only to direct investments and investors, and the promotion and protection of those investments and investors. The Chapter does not apply to subsidies provided by either government nor to any government procurement.
This Article provides for cooperation in areas including biotechnology, software and electronic manufacturing through a variety of means, including research and development, information exchange and human resource development.
This Article prescribes how the countries will list investment commitments under the Chapter.
This Article requires the countries not to discriminate between investors of their own and the other country in relation to the establishment and acquisition of investments. This commitment applies only in respect of the sectors specified in the Annex. Investors from the other country must be treated at least as well as they treat their own investors in the sectors specified in the Annex. Specified exceptions are also listed which in the case of New Zealand preserves our overseas investment screening regime.
This Article requires the two countries to treat existing investments and investors from the other country at least as well as they treat their own investments and investors in respect of the management, operation and sale of investments. This only applies to sectors listed in the Annex. Specified exceptions are also listed which in the case of New Zealand preserves our overseas investment screening regime.
When one country negotiates with a third country more favourable treatment for the promotion and protection of existing investments or investors, that more favourable treatment must be extended to investors and existing investments in the other country.
If one country eases the requirements (if any) for a third country to access the benefits of the promotion and protection of investments, this easing of requirements must be extended to the other country.
This provision allows both countries, under certain conditions, to deny the benefits of this Chapter to the other country where a company is foreign owned and controlled.
The two countries have agreed not to expropriate investments made by each other’s investors except for a public purpose under due process of law or on a non-discriminatory basis. Where an investment is expropriated, compensation must be paid.
The two countries have agreed not to expropriate investments made by each other’s investors except for a public purpose under due process of law or on a non-discriminatory basis. Where an investment is expropriated, compensation must be paid.
This provision provides for compensation for losses of covered investments under specific circumstances (for example war, revolution, a state of national emergency).
This means that both countries will permit each other’s investors to transfer their funds freely.
Allows for the transfer and recognition of rights or title in respect of investments.
Provides that one country must allow access to its courts for the other country’s investors on a basis at least as favourable as the access it allows its own investors.
This provision provides options for the settlement of disputes between investors and the government of a country. Disputes can be resolved through domestic courts or, if both governments agree, through international dispute settlement mechanisms. No claims can be pursued in relation to a decision not to permit a foreign investment.
There is provision in the Agreement to modify commitments in the schedule but with the expectation that offsetting adjustments would be made in order to maintain an equivalent general level of mutually advantageous commitments.
Provision is made to negotiate additional commitments if one of the countries unilaterally liberalises.
This Chapter sets out a number of provisions designed to ensure that trade conducted electronically between New Zealand and Thailand remains free. It provides for the two countries to work together to promote electronic commerce.
Both countries have agreed to maintain their current practice of not imposing customs duties on electronic transmissions between the two countries.
The two countries will seek to minimise the regulatory burden on electronic commerce and ensure their regulatory frameworks support industry-led development of electronic commerce.
Both countries will, to the extent possible, provide protection for consumers using electronic commerce.
Both countries will take appropriate actions to protect the personal data of users of electronic commerce.
This Article requires the acceptance of electronic forms of import/export documents except in specified circumstances.
The countries will promote the use of electronic commerce and encourage cooperation in research and training activities to develop of electronic commerce.
Only the Article on customs duties (10.2) is subject to the dispute settlement Chapter in this Agreement.
This Chapter is intended to facilitate trade and investment through promoting fair competition, APEC principles relating to competition policy and the curtailment of anti-competitive practices.
Both countries recognise the strategic importance of creating and maintaining open and competitive markets.
Both countries will employ various unilateral and cooperative approaches to promote competition.
There is a commitment to maintaining generic or sector-specific competition laws that apply to all businesses and to administering these in a transparent, comprehensive and non-discriminatory way.
Exemptions from the undertakings in Article 11.4 are permitted if they are transparent and reflect the public interest.
The two countries have agreed to cooperate on competition law enforcement.
Both countries agree that it is in their interests for their competition authorities to work together on technical cooperation activities related to the implementation of competition law and policy.
Either country may seek consultations with the other on anti-competitive practices adversely affecting trade or investment.
Both sides have agreed to make publicly available their laws promoting fair competition and their law addressing anti-competitive practices.
The dispute settlement Chapter does not apply to this Chapter. If there is an inconsistency between this Chapter and another part of the Agreement, the latter prevails.
Provides a definition of “intellectual property rights” in line with the WTO Agreement on Trade-Related Intellectual Property Rights (TRIPs).
The two countries reaffirm that they will respect the provisions of the WTO TRIPs Agreement and other relevant multilateral agreements on intellectual property.
This Article encourages both countries to recognise the importance of intellectual property rights in promoting economic and social development, technological innovation and trade.
The two countries will cooperate with a view to eliminating trade in goods which infringes intellectual property rights, including through the exchange of information through nominated contact points.
Both countries agree to cooperate through sharing information and developing contacts. The right of a country to take appropriate measures to protect traditional knowledge is recognised.
Recognising that government procurement policies can be an impediment to trade, the two countries have undertaken to work progressively towards eliminating barriers to the supply of goods and services in the area of government procurement.
Both countries reaffirm their desire to promote and implement relevant APEC principles.
The Chapter provides for the exchange of information on relevant laws and policies and opportunities for suppliers in particular sectors, and for the designation of contact points.
This Article establishes a bilateral working group on government procurement.
The Working Group will report within 12 months of the entry into force of the Agreement on the scope for commencing negotiations to expand the government procurement provisions in the CEP.
Chapter 17 on dispute settlement will not apply to this Chapter until and unless it is specifically authorised in future negotiations.
Both sides will publish, in advance of implementation where possible, relevant laws, regulations and decisions. This will give the other country the opportunity to comment on these proposed measures.
The two countries will advise, wherever possible, interested persons of administrative proceedings that may affect them. Persons who would be affected will be offered an opportunity to present facts in any proceedings, in accordance with the relevant laws.
The two countries will ensure there are domestic procedures to enable prompt review and correction, where necessary, of final administrative actions taken in relation to this Chapter.
Nothing in the Agreement prevents a country from taking certain action if it falls within the exceptions to the WTO Agreement, the relevant parts of which are repeated in the Article. In addition the Agreement does not prevent a country from taking action necessary to protect national treasures or to support creative arts of national value.
Nothing in the Agreement prevents a country from taking certain action if it falls within the exceptions to the WTO Agreement, the relevant parts of which are repeated in the Article. In addition the Agreement does not prevent a country from taking action necessary to protect national treasures or support creative arts of national value.
Various parts of the WTO Agreement regarding security exceptions are incorporated into this Agreement.
The provisions of the Agreement will not require the disclosure of confidential information where this would be contrary to the public interest or legitimate commercial interests.
These provisions permit either country flexibility in implementing its obligations under the Agreement where it is facing serious balance of payments or other external financial difficulties. These provisions are based on corresponding provisions in the WTO Agreement and impose a number of conditions on the application of any measures which the country may impose.
This provision confirms that neither country will be prevented by the Agreement from taking action to protect investors, depositors, policy holders or others who are owed a fiduciary duty by a financial service supplier. In addition, either country is permitted to take measures to ensure the integrity and stability of its financial system or the stability or the macroeconomy. A footnote confirms that such measures shall be appropriately limited to meet this objective.
The Agreement only imposes rights or obligations with respect to taxation measures where there is a corresponding right or obligation provided for in the WTO Agreement, or in relation to the expropriation of assets. In the event of any inconsistency between the CEP and the 1998 double tax agreement between Thailand and New Zealand, the tax agreement prevails.
New Zealand will not be prevented from adopting measures it deems necessary to accord more favourable treatment to Maori, including in fulfilment of its obligations to Maori under the Treaty of Waitangi. If Thailand invokes dispute settlement under Chapter 17 to investigate any action taken by New Zealand under this Article, an arbitral tribunal will not be able to interpret the Treaty of Waitangi.
A Closer Economic Partnership Joint Commission (CEP Joint Commission) is established to ensure the proper implementation of the Agreement. The CEP Joint Commission may meet at the level of Ministers or senior officials.
The CEP Joint Commission has a broad mandate, including reviewing the general functioning of the Agreement, exploring measures for further expansion of trade and investment between the countries and establishing subsidiary bodies as necessary to advise on specific matters. The CEP Joint Commission will develop procedures which will govern how representatives from the private sector may participate in its deliberations.
The CEP Joint Commission will meet within one year of the date of entry into force of the Agreement and then each year, or as otherwise agreed.
Both countries will designate contact points to facilitate communication.
There will be a general review of the entire Agreement at the level of Ministers within five years of its entry into force and at least every five years after that.
This Chapter establishes a fair, transparent, timely and effective procedure for settling disputes arising under the Agreement.
The two countries will seek to resolve any issues that arise over operation of the Agreement through consultations.
Both countries can have recourse to good offices, conciliation and mediation at any time to resolve a dispute.
Where consultations do not resolve a dispute within 60 days, a country may seek the establishment of an arbitral tribunal.
The tribunal will consist of 3 members, one appointed by each country and a third (who acts as tribunal Chair) appointed jointly by the two members. Time limits are applied for these appointments, with the President of the International Court of Justice selecting members if the countries fail to meet the timeframes.
The arbitral tribunal must provide both countries the opportunity to develop a mutually satisfactory settlement. Any ruling made by the tribunal must be clearly set out and will be final and binding on both countries.
The Chapter sets out some of the rules applying to proceedings of tribunals, including on the use of experts, leaving the remainder to be established by the tribunals themselves.
An arbitral tribunal may suspend its work for a period not exceeding 12 months, such as in a situation where the countries are trying to resolve the dispute outside the arbitral tribunal process.
Both countries will have the opportunity to review a draft ruling. The tribunal is to advise of its ruling within 120 days of its establishment, with that ruling being made public within a further 10 days.
Countries are required to implement rulings promptly. The countries must enter into consultations where one country considers the other country is not implementing the ruling.
If one country is not satisfied that the other country has adequately implemented a tribunal ruling, it may decide to suspend benefits due to the other country under the Agreement, subject to a range of conditions.
Each country must cover the costs of its arbitral tribunal member. The costs of the Chair and other expenses regarding the tribunal will be shared equally between both countries.
This Chapter contains a range of provisions on the formal aspects of the Agreement, including how it can be amended.
It provides that other countries may accede to the Agreement.
This provision confirms that, in general unless specifically provided for, the Agreement does not commit either country to passing on to the other any benefit it confers to a third country under a closer economic partnership, free trade agreement, customs union or other similar agreement.
This Article provides that the Trade Agreement Between the Government of the Kingdom of Thailand and the Government of New Zealand of 10 February 1981 will be terminated on entry into force of the Agreement.
The Chapter provides that the Agreement will enter into force after the countries have notified each other that they have completed the domestic requirements necessary for entry into force of the Agreement. Termination would take effect 12 months after written notice.
The tariff schedules for Thailand and New Zealand show phase out/elimination timetables for each tariff line. In the case of Thailand, Annex 1.3 sets out the timetable for phasing out the tariff quotas applicable to imports of sensitive agricultural products from New Zealand.
This annex details the specific rules for change in tariff classification for goods under each tariff heading or subheading. It applies to goods claiming tariff preference under the CEP which have been produced in Thailand or New Zealand wholly or partly from input materials which do not originate in either Thailand or New Zealand.
Lists the products subject to special safeguard measures in Thailand and the annual trigger volumes.
Investment schedules for Thailand and New Zealand.
Thailand has committed not to impose foreign equity limits on New Zealand investments in a number of manufacturing sectors.
All investments will remain subject to New Zealand’s overseas investment screening regime. New Zealand has not made any sector-specific commitments.
In addition to the SPS Chapter, the two countries have agreed to expedite consideration of priority products within their existing biosecurity regimes. New Zealand will develop import health standards for tropical fruit from Thailand and Thailand will address alternative measures for the importation of potatoes for processing
Thailand will facilitate access to Thailand for New Zealand business people and ease the conditions under which they do business in Thailand.
New Zealand will provide access for the temporary employment of Thai chefs in New Zealand without labour market testing provided they have a bona fide job offer, have relevant work experience, and hold a Thai national skills standard certificate for Thai cooking.
New Zealand also undertakes to explore the scope for developing a system to recognise traditional Thai massage therapist qualifications with a view to facilitating their entry to New Zealand for temporary employment.
