Trade in Goods
The FTA will eliminate 99 percent of tariffs on New Zealand’s exports by year 10. Removing duties on New Zealand products will benefit New Zealand’s significant dairy, red meat, horticulture and industrial product exports. Together with the UAE free trade agreement, entry into force of the NZ-GCC FTA will remove tariffs on 50.8% of New Zealand’s trade to the Gulf region.
Rules of Origin
Modern rules of origin provisions have been secured for New Zealand exporters through the FTA. The rules of origin found in the NZ-GCC FTA are similar to other New Zealand FTA’s, making it easier for New Zealand exporters to understand and comply whilst reducing red tape. Being a regional FTA, the accumulation of origin for goods across the region provides more opportunities for traders to produce goods using originating inputs. Without this provision, traders would have to produce goods with a much higher level of input within New Zealand for the goods to be considered originating in New Zealand and able to gain preference with GCC members.
Customs & Trade Facilitation
The chapter on Customs and Trade Facilitation provides will increase cooperation and information sharing between the customs agencies of New Zealand and the GCC. This will ensure there are predictable, efficient, and transparent customs procedures that support an increase in trade between the GCC and New Zealand. It promotes the use of advanced automated systems to facilitate trade. The chapter also contains commitments to release goods within clear timeframes to provide traders with certainty, with goods in general to be released within 48 hours unless there are exceptional circumstances or import requirements have not been met.
Sanitary and Phytosanitary Measures (SPS)
The overall objective of the SPS Chapter is to better facilitate trade in agriculture and food products by ensuring that SPS measures are no more restrictive than necessary, and to provide a means to improve transparency, communication and consultation on SPS measures. Decisions on matters affecting biosecurity and food safety will continue to be made and enforced in accordance with New Zealand’s existing regulatory regime. The right of New Zealand to determine its appropriate level of sanitary and phytosanitary protection in accordance with the SPS Agreement is preserved. The FTA emphasises communication between the competent authorities of all Parties and establishes a range of mechanisms for regulators, other officials and technical experts to work together more effectively to address issues impacting trade in the SPS area.
Trade in Services
The New Zealand services sector, one of the fastest growing parts our economy, will be able to compete on a comparable basis with our trade competitors through this FTA. The Trade in Services chapter will provide our services exporters with transparent, non-discriminatory rules that will ensure a level playing field. These outcomes will provide greater certainty for New Zealand and GCC services exporters when operating in or seeking to enter our respective markets.
The chapter includes commitments for a wide range of sectors of commercial interest to New Zealand, including professional services, education services, engineering services and environmental services. We have also agreed to ambitious temporary entry commitments to ensure our businesspeople and certain service suppliers are able to operate in the GCC market, and that we can access GCC expertise to help upskill and develop our export sectors.
Investment
The NZ-GCC Agreement does not contain substantive investment commitments, and instead sets in place a framework to negotiated investment provisions within five years. At the same time, New Zealand has agreed to separately negotiate a bilateral investment treaty with Saudi Arabia, with negotiations to commence after signature of the -GCC FTA.
Government Procurement
The Government Procurement chapter will provide New Zealand businesses with guaranteed access to GCC central government procurement opportunities on a reciprocal basis, for five of the six GCC member states (with Saudi Arabia not part of the government procurement outcome). The chapter includes commitments to fair, competitive and transparent procurement processes, aligned with international good practices in procurement.
Competition
The FTA facilitates economic efficiency and consumer welfare through promoting open and competitive markets. It requires New Zealand and the GCC to maintain and enforce competition measures that prohibit anti-competitive conduct. This provides certainty that the benefits of increased trade with the GCC will be protected against anti-competitive conduct.
Intellectual Property
The FTA recognises the importance of intellectual property (IP) in promoting economic and social development and affirms each party’s rights and obligations under the World Trade Organization Trade Related Aspects of Intellectual Property Agreement (TRIPS) and other multilateral IP agreements. The FTA requires each party provide effective and non-discriminatory protection and enforcement of IP but does not require New Zealand to make any changes to our existing law. The FTA also recognises our right to regulate to protect genetic resources, traditional knowledge and folklore.
General Cooperation and Sustainable Development
General Cooperation and Sustainable Development chapter promotes sustainable development policies and outcomes. It commits parties to ensure labour and environment laws are used for legitimate purposes and not weakened to encourage trade and investment. The chapter affirms International Labour Organisation commitments, including to respect, promote and realise the Fundamental Principles and Rights at Work. It facilitates cooperation on matters relating to labour, including compliance and enforcement mechanisms for labour rights.
The chapter also recognises the importance of women’s economic empowerment. It includes commitments to fostering women’s entrepreneurship, exchanging best practice related to policies and programmes and, in the case of New Zealand, providing opportunities for wāhine Māori to engage in trade activities. It also recognises the importance of addressing climate change, particularly under the UNFCC and the Paris Agreement. It recognises the importance of cooperating in addressing climate change, especially in matters of mutual interest such as green houses gases, adaptation, sustainable agriculture and resilient food systems.
Legal and Institutional Framework
The FTA includes chapters which provide for its legal and institutional framework. These chapters facilitate the structure of FTA committees, transparency and State-to-State settlement of disputes. The FTA also secures exceptions to ensure both governments can continue to regulate in the public interest.
The Treaty of Waitangi exception, included in all of New Zealand’s contemporary FTAs, allows the New Zealand Government to implement domestic policies that accord more favourable treatment to Māori, including in fulfilment of its obligations under the Treaty of Waitangi, provided that such policies do not constitute a means of arbitrary or unjustified discrimination or a disguised restriction on trade.