CPTPP and Canada

CPTPP provides New Zealand businesses with preferential access to the world’s 11th-largest economy for the first time.

On this page

Why Canada matters

CPTPP is New Zealand’s first trade agreement with Canada – our 12th-largest export market worth NZ$1.1 billion in the year to the end of June 2018.

Tourism and travel services are New Zealand’s largest export categories to Canada, followed by wine, beef and lamb. Canada’s main exports to New Zealand include machinery, wood, pork and fertilisers.

There is also potential for CPTPP to create a platform for New Zealand and Canadian companies to partner on joint initiatives to service Asian markets – market knowledge in New Zealand combining with scale and counter-seasonal production out of Canada. This fits with Canada’s vision to diversify its trade profile away from its reliance on natural resources and North America.

A graphic image showing NZ's trade with Canada. .

Reduced trade barriers

Under CPTPP, tariffs will be eliminated on 99% of New Zealand exports to Canada on entry into force and 99.9% at full implementation. This represents estimated tariff savings of NZ$7 million per year.

Some of the specific goods on which Canadian tariffs will be eliminated are highlighted in the table below. You can search the online tariff finder(external link) to find the outcome for your particular export or import item.

Sector	Key outcomes in Canada
Wine	immediate elimination of the tariff into New Zealand’s fourth-largest wine market; immediate elimination of tariffs on certain spirits, liqueurs and RTDs; dedicated wine and distilled spirits text to provide greater transparency and flexibility on labelling and certification requirements; New Zealand and Canada have also agreed a side letter covering the cost of service differentials applied by some Canadian provinces.
Meat	immediate elimination of tariffs on processed meats and offal; elimination of the 26.5% beef tariff by 2023 giving improved access over the existing WTO duty-free quota.
Horticulture	immediate elimination of the 12.5% or more tariff on asparagus; immediate elimination of the 9.5% or more tariff on onions; immediate elimination of the 9.5% or more tariff on peas and frozen sweetcorn; immediate elimination of the 8.5% or more tariff on capsicums; immediate elimination of the 8% or more tariff on cherries; immediate elimination of the 6% or more tariff on blackcurrants.
Dairy	immediate elimination of the 9.5% tariff on retail infant formula; immediate elimination of tariffs on milk protein substitutes; Limited duty-free access to new quotas for a number of key dairy products including: butter; cheese; cream; ice cream; milk protein concentrates; whole and butter milk powders.
Other	immediate elimination of all remaining duties on fish and seafood products; immediate elimination of all remaining duties on forestry products; immediate elimination of the up to 15.5% tariffs on wool, leather, and hides and skins; immediate elimination of the 11% tariff on vegetable fats and oils; immediate elimination of the 8% tariff on animal feed preparations; immediate elimination of the 3.5% tariff on cat and dog food; immediate elimination of tariffs on make-up and skincare preparations; and immediate elimination of tariffs on jewellery.

There are new commercial opportunities for New Zealand businesses to win government procurement contracts. Canada’s government procurement market is sizable, about 13% of GDP, and it procures a diverse range of goods and services, which will provide greater opportunities for New Zealand’s established industries as well as more specialised and niche exporters.

For certain government procurement activity, New Zealand businesses will be able to compete for government procurement contracts in Canada on an equal footing with domestic suppliers and they will be subject to more open, fair and transparent procurement rules.

Servicing the market

Tourism and travel services are New Zealand’s largest export category with Canada. Under CPTPP, New Zealand service suppliers will have improved protection, predictability and transparency when doing business in the Canadian market.

For New Zealand, key outcomes from Canada’s CPTPP commitments include:

Improved market access in a range of service sectors including accounting, auditing and bookkeeping, architectural, engineering and management consulting services.
Canada has locked in its current regime relating to speciality air services guaranteeing that any future market reforms will automatically flow through to New Zealand providers.
Canada has also locked in its current regime relating to patent and trademark agents, guaranteeing that any relaxation of local presence requirements will automatically flow through to New Zealand providers.
Access has been guaranteed, with some limited reservations, in key areas of interest to New Zealand including business services, environmental services, education services and services incidental to agricultural.

Working in Canada

New Zealand business people going to work in Canada will benefit from CPTPP:

Business visitors including installers and servicers can stay in Canada for up to six months, provided their primary source of income, and principal place of business and accrual of profits, comes from outside Canada.
Intra-corporate transferees who are executives, managers and specialists can enter Canada for up to three years, with the possibility of an extension.

Investment partners

Canada was New Zealand’s top foreign investor in 2015. Canadian companies are investing in New Zealand commercial property, agriculture, oil and gas, information and communication technology, financial, and retail sectors.

CPTPP investment rules provide greater certainty and protection for investors, while preserving the rights of governments to legislate and regulate in the public interest. Strong rules will help ensure that New Zealand and Canadian investors are treated in a fair, equitable and non-discriminatory manner, allowing them to compete on an equal footing with other investors in areas such as energy, manufacturing, financial services and professional services.

Both countries operate investment screening regimes. Canada has increased its investment review threshold for New Zealanders investing in Canadian business. Only those investors seeking to take control of companies worth more than C$1.5 billion must obtain approval from the Canadian government. Similarly, the threshold above which a non-government Canadian investor must get approval to invest significant business assets in New Zealand has doubled to NZ$200 million as a result of CPTPP.

Canada has locked in commitments made in relation to its investment screening regime and foreign ownership of key Canadian companies meaning it cannot impose tighter restrictions on New Zealand investors in the future.

While investors in both countries have access to the investor-state dispute settlement mechanism (ISDS), Canada and New Zealand are committed through a joint declaration [PDF, 115 KB] to promote transparent conduct rules on the ethical responsibilities of arbitrators and to take into account the evolving international practice and the evolution of ISDS.

More information

New Zealand and Canada: Trade Partners [PDF, 1.2 MB]

Minister Parker: CPTPP underway from 30 December(external link)

NZTE’s Canada Market Guide(external link)

New Zealand High Commission, Ottawa

Canada New Zealand Business Council(external link)

Canadian Government’s CPTPP Partner: New Zealand(external link)

Tariff rate quota administration information(external link)