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TPP INFORMATION AND OUTCOMES

By: Autralia Department of Foreign Affairs and Trade

I.

TPP OUTCOMES AT A GLANCE

The Trans-Pacific Partnership Agreement (TPP) is a regional free trade agreement (FTA) of
unprecedented scope and ambition with great potential to drive job-creating growth across the
Australian economy.
The 12 countries that negotiated the TPP Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia,
Mexico, New Zealand, Peru, Singapore, the United States and Vietnam represent around 40 per cent
of the global economy and a quarter of world trade. Australias exports of goods and services to these
countries were worth $109 billion last year a third of Australias total exports.1 In 2014, Australian
investment in TPP countries was 45 per cent of all outward investment.
Conclusion of the TPP negotiations is the first concrete step towards realising the long-term vision of a
Free Trade Area of the Asia-Pacific. The Asia-Pacific is a key driver of global economic growth. With
close to half of all global trade and around 70 per cent of Australia's trade flowing through this region,
expanding and deepening Australias trade and investment relationships is critical to Australias future
economic growth and prosperity. TPP membership is open to other Asia-Pacific economies and
Australia is committed to expanding TPP membership over time.
The TPP has delivered high quality outcomes that will:

open substantial new trade and investment opportunities for Australia;

promote job-creating growth;

further integrate our economies in this fast-growing region; and

promote and facilitate regional supply chains.

By setting common rules and promoting transparency of laws and regulations, the TPP will provide
certainty for businesses and reduce costs and red tape for Australian exporters, service suppliers and
investors.
For Australian goods exporters

The TPP will eliminate more than 98 per cent of tariffs in the TPP region.

Tariffs on US$9 billion of Australias dutiable exports to TPP countries will be eliminated.

These outcomes build on the strong trading relationships Australia already has with many TPP
countries, underpinned by FTA arrangements with Brunei Darussalam, Chile, Japan, Malaysia,
New Zealand, Singapore, the United States and Vietnam.

For agriculture, the TPP will eliminate tariffs on more than $4.3 billion of Australias dutiable exports of
agricultural goods. A further $2.1 billion of Australias dutiable exports will receive significant
preferential access through new quotas and tariff reductions. In 2014, around 33 per cent, or $15 billion,
of Australias agricultural exports were to TPP countries.

Further information on the agriculture outcomes in the TPP are set out in the Goods market access fact
sheet. Highlights include:

Beef: the TPP will see significant reductions and elimination of tariffs on beef and beef products
into Japan (building on the Japan-Australia Economic Partnership Agreement (JAEPA);
elimination of tariffs on beef and beef products into Mexico and Canada over 10 years and
elimination of the AUSFTA beef safeguard into the US;

Sugar: for the first time in over 20 years, Australia has been granted guaranteed new access into
the US; tariff elimination and levy reduction for high polarity sugar into Japan adding further to
the competitive advantage of JAEPA; elimination of the tariff on refined sugar into Canada;

Rice: for the first time in over 20 years, quota expansion for Australian rice into Japan and
agreement to new administrative arrangements to facilitate trade;

Dairy: elimination of tariffs on a range of cheeses covering over $100 million in existing trade
with Japan, new preferential access for a further estimated $100 million of trade, building
substantially on JAEPA and new quota arrangements for Australia on butter/skim milk
powder. In the US. elimination of tariffs on dairy products including milk powders, ice-cream,
infant formula and selected cheeses, increased quota access of 9000 tones for Australian cheese
exports and improved quota administration arrangements. New preferential access into
Mexico and the highly-protected Canadian market;

Cereals: elimination of tariffs on wheat and barley into Mexico (within 10 years) and Canada
(upon entry into force). Reduction of the mark-ups applied to wheat and barley in Japan and
the creation of new quota arrangements above and beyond JAEPA;

Wine: elimination of tariffs into Mexico (between 3 to 10 years) and Canada (upon entry into
force), Peru (within 5 years) and, for the first time, Malaysia (within 15 years) and Vietnam
(within 11 years); and

Seafood: elimination of all tariffs into Canada, Peru and Vietnam on entry into force, and Mexico
and Japan within 15 years.

Australias exports of resources and energy products to TPP member countries were worth close to $47
billion in 2014, representing 30 per cent of Australias total exports of these products. This includes
around $41 billion of resources and energy exports to Japan. While the majority of Australias major
exports, such as coal, iron ore and liquefied natural gas already enter TPP countries duty-free, the TPP
has secured additional market access, including:

Immediate elimination of tariffs on iron ore, copper and nickel to Peru;

Elimination of tariffs on butanes, propane and liquefied natural gasto Vietnam over 7 years;

Elimination of Vietnams 20 percent tariffs on refined petroleum over 10 years Australia


exports were valued at $11 million in 2014.

Australias exports of manufactured goods to TPP countries were worth an estimated $23 billion in
2014. New market access outcomes include:

Immediate elimination of tariffs on iron and steel products in Canada and in Vietnam within 10
years;

Elimination of ship tariffs in Canada over 5 to 10 years;

Elimination of tariffs on pharmaceutical, machinery, mechanical and electrical appliances, and


automotive parts to Mexico within 10 years;

Elimination of duties on paper and paperboard to Peru over 10 years; and

Elimination of tariffs on automotive parts to Vietnam over 10 years.

Australian businesses will now be able to bid for tenders to supply goods (such as
pharmaceutical products, electronic components and supplies) used for government purposes in
Brunei Darussalam, Canada, Malaysia, Mexico, Peru and Vietnam.

For Australian service suppliers


TPP countries account for 24 per cent of the worlds trade in services, with Australian services exports to
TPP countries worth over $20 billion in 2014 (almost 35 per cent of total Australian services exports).
The TPP will contribute to a significant expansion and diversification of Australian services exports to
Asia-Pacific countries by liberalising key barriers, providing more transparent and predictable operating
conditions in TPP countries, and capturing future services sector reforms.
A snapshot of the extensive TPP investment and services outcomes include:

Mining Equipment Services and Technologies (METS) and oilfield service providers: Major new
commercial opportunities for our world class service providers, including through:
o

Mexicos historic liberalisation of its energy sector;

Vietnam opening its mining investment regime

Brunei Darussalam and Vietnam locking in future reforms to local content regimes or
otherwise committing to a level playing field between Australian and foreign suppliers
providing goods and services in the mining, oil and gas sectors; and

New rules on large state-owned enterprises such as PEMEX, VINACOMIN and


PETROVIETNAM, which will help ensure that Australian goods and service providers can
compete fairly for contracts.

Professional services: Malaysia has locked in recent reforms to the legal, architectural,
engineering and surveying services sectors, removing a number of restrictions that have long
been of concern to Australian businesses;

Financial services: New opportunities for Australian exporters to TPP countries, with
guaranteed ability to provide the following cross-border services: (i) investment advice and
portfolio management services to a collective investment scheme and (ii) insurance of risks
relating to maritime shipping and international commercial aviation and freight, and related
brokerage;

Temporary entry of business people: Preferential temporary entry arrangements for Australian
business people and their spouses into key TPP markets, including the waiving of work permits
and provision of work rights for spouses in Brunei Darussalam, Canada and Mexico;

Education Services: Australian universities and vocational education providers will benefit from
guaranteed access to a number of existing and growth markets in Brunei Darussalam, Japan,
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Malaysia, Mexico and Peru. Australia will also be well placed to supply online education
services across the region.

Transport services: Australian freight and logistics companies stand to benefit from enhanced
commitments that support integrated logistics supply chains.Australian providers of transport
and logistics services in Malaysia and Vietnam will gain strong trade and investment protections
for the first time. The TPP will capture future liberalisation of investment regulations in aviation
in Vietnam and freight trucking in Malaysia and Vietnam, key markets for our airlines and
logistics providers.

Telecommunications services: Australian companies stand to benefit from the phasing out of
foreign equity limits in Vietnam's telecommunications sector five years after the entry into force
of the TPP and the ability to apply to wholly-own telecommunications ventures in Malaysia.

Health services: Australian providers of private health and allied services will benefit from
greater certainty regarding access and operating conditions in Malaysia, Mexico and Vietnam.

Hospitality and tourism services: Australian suppliers of travel agency and tour operator
services will benefit from guaranteed access in Brunei Darussalam, Canada, Chile, Japan, Mexico
and Peru; and greater certainty regarding access and operating conditions in Malaysia and
Vietnam. Increased trade and investment among TPP countries will also increase demand for
domestic tourism services and support the development of Australias tourism sector,
particularly in regional Australia.

Government procurement: New opportunities for Australian businesses to bid for government
procurement services contracts, such as:
o

Accounting, auditing and taxation services in Brunei Darussalam, Canada, Malaysia,


Mexico, Peru and Vietnam;

Management consulting services in Brunei Darussalam, Malaysia, Mexico and Peru;

Computer and related services offer by all TPP Parties, along with maintenance of office
machinery in Brunei Darussalam, Canada, Malaysia, Mexico, Peru and Vietnam;

Architectural engineering and other technical services in Brunei Darussalam, Canada,


Malaysia, Mexico and Peru;

Land and water transport services in Brunei Darussalam, Malaysia and Peru;

Telecommunication and related services in Brunei Darussalam, Canada, Malaysia and


Peru;

Environmental protection services in Brunei Darussalam, Canada, Malaysia, Mexico,


Peru and Vietnam;

Education services in Brunei Darussalam, Canada, Japan, Malaysia, Mexico and Peru;
and

Health and Social Services in Brunei Darussalam, Malaysia and Peru.

(Further details on the TPP services outcomes can be found in the following sector-specific fact sheets:
Resources and Energy; Education Services; Professional Services; Transport and Logistics; Temporary
Entry of Business Persons and Trade in the Digital Age, which will be available shortly).
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For investors
The TPP will create new investment opportunities and provide a more predictable and transparent
regulatory environment for investment.
Australian investment in TPP countries more than doubled in the last decade to reach $868 billion in
2014, a rise of 16 per cent over the previous year. Australian investment in TPP countries is 45 per cent
of all outward investment. Investment in Australia from TPP countries more than doubled in the last
decade to reach $1,109 billion in 2014, a rise of 10 per cent over the previous year. Investment from
TPP countries is 40 per cent of all foreign investment in Australia.
The TPP will promote further growth and diversification of Australian outward investment by liberalising
investment regimes in key sectors such as mining and resources, telecommunications and financial
services. For example, Canada will allow Australian investors to apply for an exemption from the 49 per
cent foreign equity limit on foreign ownership of uranium mines, without first seeking a Canadian
partner. Australian investors will also benefit from preferential investment screening
thresholds. Australian investments into Canada below CA$1.5 billion will not be screened. Australian
investors will also benefit from commitments offered by Japan, Vietnam and Brunei to only impose
conditions on foreign investment on the initial sale of interests or assets owned by the government.
The TPP will also promote further growth and diversification of foreign investment in Australia by
liberalising the screening threshold at which private foreign investments in non-sensitive sectors are
considered by the Foreign Investment Review Board (FIRB), increasing it from $252 million to $1,094
million for all TPP Parties.
Under the TPP, Australia has retained the ability to screen investments in sensitive sectors to ensure
they do not raise issues contrary to the national interest. All investments by foreign governments will
continue to be examined and lower screening thresholds will apply to investment in agricultural land
and agribusiness.
The TPPs investment obligations can be enforced directly by Australian and other TPP investors through
an Investor-Statement Dispute Settlement (ISDS) mechanism. The ISDS mechanism includes safeguards
to protect the governments ability to regulate in the public interest and pursue legitimate public
welfare objectives, such as public health. Australias tobacco control measures cannot be challenged.
Further information on the TPP investment outcomes, including ISDS, can be found in the Investment
fact sheet which will be available shortly.
For Australian consumers and businesses
Consistent with Australias other free trade agreements, remaining Australian tariffs on imports from
TPP countries will be eliminated, with consumers and businesses set to benefit from lower prices.
As a regional free trade agreement, the TPP will create additional and longer term benefits for
consumers and businesses that are not possible to achieve under a bilateral FTA. Even though Australia
has relatively low tariffs, products created via an international supply chain are taxed at the borders
over which they pass before they get to our shores. Under the TPP, producers will be able to use inputs
from any of the 12 participating countries and trade the good under the TPP preferential trading
arrangements. This means lower tariff rates on inputs as well as the final product.
See Global Value Chains and the TPP for more information, which will be available shortly.

Lowering the cost of doing business


The TPP includes additional commitments which will lower the costs of trade. Highlights include:

More transparent and efficient customs procedures making it easier for Australian companies to
export and do business in the region. For example, TPP Parties will be required to provide an
advance ruling on the tariff classification of a good, how it should be valued, whether a good is
originating and how to claim preference;

Regional rules of origin and a single set of documentary procedures for products traded under
the TPP. These arrangements will support the development of regional supply chains by
encouraging cumulation, which permits inputs used in the production of a good from one TPP
Party to be treated as the same as inputs from any other TPP party when making a good. The
arrangements will also allow businesses to save on administrative costs by allowing them to
trade under the one set of rules, rather than under existing multiple bilateral FTAs.

Duty-free temporary admission of pallets and containers. This TPP commitment will provide
significant cost and administrative savings for Australian businesses engaged in providing
transport logistics services in the Asia-Pacific;

Mechanisms to address non-tariff barriers (NTBs) impeding trade, which will give Australia an
important avenue to address NTBs affecting our exports in the region. The TPP will enhance
transparency, cooperation and promote good practice with regard to establishment and
maintenance of technical regulations. A better understanding of each Partys regulatory
systems will improve public safety and benefit Australian consumers; and

Simplified rules and technical requirements for several products, including wine and spirits. For
example, the Australian wine industry will be able to use the same label on bottles of wine for
export to all TPP countries, saving money on marketing and distribution costs.

Addressing contemporary trade challenges


The TPP will also address contemporary trade challenges in ways that have not previously been
addressed in Australian FTAs. Highlights include:

Commitments ensuring state-owned enterprises and government designated


monopolies engaged in commercial activities make purchasing and sales decisions on a
commercial basis and do not discriminate against Australian suppliers of goods and services.
These rules will promote competition, trade and investment in TPP Parties and ensure
Australian exporters will be able to compete on a level playing field;

State of the art e-commerce provisions driving the information economy and facilitating trade
among TPP Parties. For example, TPP Parties have committed to allow the movement and
storage of data across borders, providing a platform for growth in Australian ICT exports. The
TPP will ensure appropriate consumer protections and the right of governments to regulate in
the public interest. Australias regulatory framework, including the Privacy Act, will not be
affected.

Assisting small and medium-sized enterprises (SMEs) to reap the benefits of the TPP, with an
emphasis on moving to paperless trading, making customs and export delivery more effective
and efficient, and user-friendly websites targeted at SMEs to provide easily accessible
information about the TPP.
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Ensuring balanced intellectual property rules which aim to encourage investment in new ideas,
support creative and innovative industries, address and prevent piracy and counterfeiting, and
promote the dissemination of information, knowledge and technology. The TPP will not require
any changes to Australias domestic intellectual property regime, but will create opportunities
for Australian businesses in the region.

Promoting high levels of environmental protection, including by liberalising trade in


environmental goods and services, and ensuring TPP Parties effectively enforce their domestic
environmental laws. TPP Parties must also take measures in relation to a number of important
environmental challenges, such as protecting the ozone layer, protecting the marine
environment from ship pollution, combatting illegal wildlife trade and combatting over-fishing
and illegal fishing. In a breakthrough in the fight against overfishing, subsidies for fishing that
negatively affect overfished stocks and subsidies for vessels engaged in illegal fishing will be
prohibited;

Enhanced compliance by TPP Parties with internationally-recognisedlabour rights, such as


elimination of forced labour, abolition of child labour, freedom of association and the right to
collective bargaining. The TPP will also enhance cooperation and consultation on labour issues,
and effective enforcement of labour laws in TPP Parties.

Robust provisions combatting corruption and bribery of public officials, and other acts of
corruption adversely affecting international trade and investment. These anticorruption provisions will provide greater transparency and certainty to Australian individuals
and businesses seeking to trade with, and invest in, TPP Parties.

Next steps
TPP Parties are now finalising arrangements for the release of the TPP text, and it will be released well in
advance of signature.
In accordance with Australias treaty-making process, before binding treaty action is taken, the TPP text
and accompanying National Interest Analysis will be tabled in Parliament for 20 joint sitting
days. Following tabling, the Joint Standing Committee on Treaties will conduct an inquiry into the TPP
and will report back to Parliament. Parliament will also consider any legislation that may be necessary
to implement the Agreement.
When a country has completed its domestic treaty-making processes, it will notify other TPP countries
that it has done all that is required for the Agreement to enter into force. The Trans-Pacific Partnership
Agreement will enter into force 60 days after all original signatories have notified completion of their
domestic legal procedures. If this has not occurred within two years of signature, the Agreement will
enter into force 60 days after the expiry of that two year period if at least six original signatories
accounting for 85 percent of the combined gross domestic product of the original signatories have
ratified the agreement.
For more information, refer to: Background document: Implementation timeline which will be
available shortly.

II.

Outcomes: Goods market access

The Trans-Pacific Partnership (TPP) aims to expand trade, boost economic growth and integrate regional
economies through historic reductions in trade barriers.
The TPP includes some of the worlds biggest economies (the US, Japan, and Canada) and five of
Australias top 10 goods export destinations (Japan, the US, New Zealand, Singapore and Malaysia).
Australias goods exports to TPP Parties were worth around $88 billion in 2014 or 33 per cent of
Australias total goods exports.
The TPP will eliminate 98 per cent of tariffs in the TPP region. Tariffs on US9 billion of Australias
dutiable exports to TPP countries will therefore be eliminated under the TPP.
The TPP market access outcomes build on existing access Australia has with its FTA partners of Japan,
the US, Chile, New Zealand, Malaysia, Singapore, Brunei and Vietnam. The TPP also creates valuable
new market access opportunities for Australian exporters in the three TPP Parties where Australia does
not have a FTA, namely, Canada, Mexico and Peru. Australia supports the expansion of the TPP over
time to include other economies in the Asia-Pacific.
As a regional free trade agreement, the TPP will create additional benefits. The combined effect of new
market access and common rules will make it easier for Australian businesses, exporters and consumers
to participate in, and benefit from, regional value chains (also known as global value chains). For more
information, refer to: Global value chains and the Trans-Pacific Partnership Agreement.
Agriculture
Australia exported around $15 billion worth of agricultural goods to TPP countries in 2014, representing
close to 33 per cent of Australias total exports of these products. The TPP will eliminate tariffs on more
than $4.3 billion of Australias dutiable exports of agricultural goods to TPP countries upon entry into
force of the Agreement. A further $2.1 billion of Australias dutiable exports will receive significant
preferential access through new quotas and tariff reductions.
Summary outcomes
Beef
Over 55 per cent1 of Australias beef exports go to TPP markets. Beef is Australias largest global
agricultural goods export, worth $8.4 billion in 2014. TPP market access outcomes for Australian beef
producers and exporters include:

Japans beef tariffs will be reduced to 9 per cent within 15 years of entry into force of the TPP.
Australian beef exports to Japan were valued at $1.6 billion in 2014;

The majority of Japans tariffs on offal will be eliminated over 10 to 15 years of entry into force
of the TPP, and tariffs on cheek and head meat significantly reduced to 9 per cent within 15
years of entry into force of the TPP. Australian offal exports to Japan were valued at $161
million in 2014;

Elimination of Japanese tariffs on processed meat products within 15 years of entry into force of
the TPP. Australian exports of these products to Japan were valued at $20 million in 2014;

Elimination of the United States price-based safeguard under the Australia-United States Free
Trade Agreement (AUSFTA) on entry into force of the TPP. Australia beef exports to the US were
valued at $2.5 billion in 2014;

Elimination of Canadian beef tariffs (currently 26.5 per cent) within 10 years of entry into force
of the TPP. Australian beef exports to Canada were valued at $163 million in 2014;

Elimination of all Peruvian beef tariffs (currently 17 per cent) within 10 years of entry into force
of the TPP;

Elimination of all Mexican tariffs on beef carcasses and cuts (currently up to 25 per cent) within
10 years of entry into force of the TPP; and

Elimination of Mexicos tariff (currently 20 per cent) on other offal (used for taco meat) from
entry into force of the TPP. Australian exports of this product were valued at $6 million in 2014.

Sheep meat
Australia exports around $965 million in lamb and mutton to TPP markets, 38 percent of all sheep meat
exports.
Key TPP market access outcomes include:

Tariffs on exports to Mexico will be eliminated within 8 years of entry into force of the
TPP. Australia sheep meat exports to Mexico were valued at $22 million in 2014;

Tariffs on sheep meat exports to all other TPP countries will be eliminated upon entry into force
of the TPP.

Wool
Total Australian exports of wool were valued at around $2.4 billion in 2014, and wool exports to TPP
countries were valued at around $82 million in 2014.
The TPP will eliminate all remaining tariffs on Australian raw wool exports to TPP countries from entry
into force of the Agreement. Products produced using Australian wool in Malaysia, Vietnam or any
other TPP partner will receive preferential treatment throughout the TPP region. The rules of origin for
textiles will encourage greater demand for the Australian wool used to produce high quality yarns.
Pork
In 2014, 70 per cent of Australias pork exports went to TPP countries, valued at $72 million.
Key TPP market access gains for Australian pork producers and exporters include:

Building on JAEPA, elimination of the ad valorem component of Japans pork tariffs within 10
years of entry into force of the TPP;

Building on JAEPA, a 90 per cent reduction in Japans specific tariff applied to pork cuts and
carcasses within 10 years of entry into force of the TPP;

Building on the Malaysia-Australia Free Trade Agreement and the ASEAN-Australia-New Zealand
Free Trade Agreement (AANZFTA), elimination of all Malaysian pork tariffs within 15 years; and

Elimination of Mexicos 20 per cent pork tariff on entry into force of the TPP.

Cereals and grains


Total Australian exports of cereals and grains were valued at around $8.2 billion in 2014, around 18per
cent (or $1.5 billion) of which was exported to TPP countries.
TPP market access outcomes for Australian cereals and grains producers and exporters include:

Significant market access improvements in Japan for wheat, barley and malt, building on JAEPA,
including:
o

reduction of the mark up on wheat and barley by 45 per cent within 10 years of entry
into force of the TPP;

the creation of new quota volumes for wheat and barley under the simultaneous buysell mechanism. Australias exports of these products to Japan were worth
approximately $481 million in 2014; and

new quota access for malt exports.

Elimination of Mexican tariffs on wheat (currently 67 per cent) within 10 years of entry into
force of the TPP;

Elimination of Mexican tariffs on barley (currently 115 per cent) within 5 years of entry into
force of the TPP;

Elimination of Perus tariffs on cereals and grains (currently 9 per cent) within 5 years of entry
into force of the TPP; and

Elimination of all Canadian tariffs on cereals and grains upon entry into force of the TPP.

Dairy
Total Australian dairy products exports were valued at $2.5 billion in 2014, and around 39per cent
(valued at $994 million) was exported to TPP countries.
Key TPP market access outcomes for Australian dairy producers and exporters include:

Significant market access improvements in Japan for Australian dairy. Australian dairy exports to
Japan were $433 million in 2014. Building on JAEPA, outcomes include:
o

elimination of tariffs on certain cheese products, and tariff reductions and new quota
allocations for remaining cheese products;

new quotas for butter and skim milk powder with the in-quota mark-up eliminated
within 10 years of entry into force of the TPP; and

new quotas and tariff reductions for a range of dairy products including ice cream,
whole milk powder, condensed milk, yoghurt and infant formula.

Beyond the outcomes in our bilateral FTA, the US will eliminate all WTO in-quota tariffs for dairy
products on entry into force of the TPP and will eliminate all tariffs on milk powders, infant
formula, ice cream and selected cheese lines where we have a growing trade. The US will also
improve quota administration arrangements. Australias dairy exports to the US were worth
around $20 million in 2014;

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Preferential access into the highly protected Canadian market with new quotas for dairy
products including, cheese, milk powders and butter. Tariffs on milk protein concentrates will
be eliminated on entry into force.

Mexico will create new quotas access, including for butter, cheese and milk powders, and will
eliminate tariffs on yoghurt.

Rice
Total Australian rice exports were valued at around $554 million in 2014-15. Key TPP market access
outcomes include:

For the first time since 1995, new quota access for Australia into Japan with a new 6,000 tonne
quota from entry into force of the TPP, growing to 8,400 tonnes after 12 years, for Australian
rice and rice flour exports. Japan will also reduce tariffs on a number of rice preparation
products;

Japan will amend existing administrative arrangements under its WTO quota on rice by
allocating 60,000 tonnes towards medium grain rice for processing use, one of the major types
of rice that Australia exports;

Improvements to Japans tendering process for rice. Japan will now offer tenders 6 times a year,
including an additional tender in May in line with Australias growing season;

Sugar
Total Australian exports of sugar were valued at $1.5 billion in 2014, and around one third of these
exports (valued at an estimated $510 million) went to TPP countries.
TPP market access gains for Australian sugar producers and exporters include:

The US will provide Australia with the largest access granted to a sugar exporting country in over
20 years, with an additional 65,000 tonnes of access from entry into force of the TPP. Australia
will now have access equivalent to Brazil into the US market. The US will also provide Australia
with 23 per cent of future additional WTO quota allocations, which could see Australia's raw
sugar exports to the US climb above 400,000 tonnes by 2019/20.

Building on the JAEPA, elimination of Japans tariff and reduction in the levy on high polarity
sugar exports on entry into force of the TPP. In 2014, Australia sugar exports to Japan were
valued at around $200 million;

Elimination of Canadas tariffs on refined sugar (currently CA$30.86/tonne) within 5 years of


entry into force of the TPP. Australia already has duty free access for raw sugar into Canada;

Mexico will also apportion Australia a guaranteed 7 per cent of any tariff rate quota for raw
sugar in the years in which it is offered. Australia is only the 6th country Mexico has offered
such an outcome;

Elimination of in-quota tariffs on Vietnams WTO sugar quota on entry into force.

Malaysia has committed to allow Australia to engage in the wholesale distribution of refined
sugar in Malaysia for use in the food and beverage industry

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Cotton
Total Australian exports of cotton were valued at around $2 billion in 2014, and 12per cent of cotton
exports (valued at 251 million) were sent to TPP countries.
All tariffs on Australian cotton exports will be eliminated under the TPP, with most eliminated from
entry into force. US tariff elimination will occur in accordance with the timelines in the AUS FTA - by
2023.
Australian cotton producers will also benefit from creation of new regional supply chains into the US and
Japanese consumer markets. For example, clothing produced in Vietnam from Australian cotton will
benefit from the elimination of US tariffs on cotton products over 10 to 15 years encouraging greater
demand for Australian cotton in the TPP region.
Wine
Total Australian wine exports were valued at $1.9 billion in 2014, and 45 percent of these exports
(valued at $837 million) went to TPP countries.
TPP market access gains for Australian wine producers and exporters include:
o

Elimination of Canadas tariffs (currently 1.87 /litre and 4.68 /litre) upon entry into
force of the TPP. Australian wine exports to Canada were valued at $174 million in
2014;

Elimination of Malaysian tariffs within 15 years of entry into force of the TPP. Australian
wine exports to Malaysia were valued at $34 million in 2014 and are currently subject to
tariffs ranging from 7 to 23 Malaysian Ringgit per litre;

Elimination of Vietnamese tariffs within 11 years of entry into force of the


TPP. Australian wine exports to Vietnam were valued at $5.4 million in 2014 and are
currently subject to tariffs of up to 59 per cent;

Elimination of Mexican tariffs (currently 20 per cent) within 3 years of entry into force of
the TPP for higher quality wine and elimination of all tariffs within 10 years of entry into
force of the TPP for all wine; and

Elimination of Perus 9 per cent tariffs upon entry into force of the TPP for table wine
and within 5 years for other wine.

Horticulture
Total Australian horticulture exports were valued at $2.4 billion in 2014, and 24 per cent of these
exports (valued at $577 million) went to TPP countries.
TPP market access outcomes for Australian horticultural producers and exporters include:
o

Building on JAEPA, Japan will extend the period by which oranges will face the lower
out of season tariff (corresponding to the main growing season in Australia) to an 8
month period (from 1 April to 30 November), and will eliminate that tariff over 6
years. The higher in season tariff will be eliminated over 7 years. Australian orange
exports to Japan were valued at $32 million in 2014;

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Japan will also eliminate all tariffs on fruit juices within 10 years of entry into force of
the TPP, building on the quota arrangements achieved under JAEPA. Australia fruit juice
exports to Japan were valued at $18 million in 2014;

Elimination of all Canadas horticulture tariffs upon entry into force of the TPP. Australia
horticultural exports to Canada were valued at $20 million in 2014;

Elimination of most of Perus horticulture tariffs (currently up to 17per cent) upon entry
into force of the TPP; and

Elimination of most of Mexicos horticulture tariffs upon entry into force of the TPP and
elimination of all tariffs within 15 years of entry into force.

Seafood
Australias total seafood exports in 2014 were worth $1.2 billion, with exports to TPP countries valued at
$907 million.
TPP market access outcomes for Australian seafood producers and exporters include:
o

All Japanese seafood tariffs will be eliminated within 15 years of entry into force of the
TPP;

All Vietnamese seafood tariffs will be eliminated on entry into force of the TPP;

Canada and Peru will eliminate all tariffs on entry into force of the TPP; and

Mexicos seafood tariffs will be eliminated within 15 years of entry into force of the TPP,
with the majority eliminated on entry into force.

Resources, energy and manufactured goods


Australian exports of resources, energy, and manufactured products generally face far lower tariff
barriers than those facing agricultural goods. Nonetheless, the TPP will eliminate all remaining tariffs on
Australian exports of non-agricultural products to TPP countries and create new opportunities for
Australian exports.
Resources and energy
Australias exports of resources and energy products to TPP countries were worth over $47 billion in
2014, representing around 53 per cent of Australias total goods exports to these countries. This
includes around $41 billion of resources and energy exports to Japan.
TPP market access outcomes for resources and energy products that are additional to Australias
existing FTAs include tariff elimination on:
o

iron ore, copper, nickel and inorganic chemical exports to Peru on entry into force of
the TPP;

butane, propane and liquified natural gas exports to Vietnam within 7 years of entry
into force of the TPP; and

refined petroleum exports to Vietnam within 10 years of entry into force of the TPP.
Australia exported $11 million worth of refined petroleum to Vietnam in 2014.

13

Manufactured and other goods


Australias exports of manufactured and other goods to TPP countries were worth an estimated $23
billion in 2014. TPP market access outcomes for manufactured and other goods additional to Australias
existing FTAs include tariff elimination on:
o

iron and steel products and aluminium exported to Canada on entry into force of the
TPP. Australian exports of these products were worth around $12 million in 2014;

ships and boats exported to Canada within 10 years of entry into force of the TPP, with
tariffs of up to 25 per cent eliminated on entry into force. Australian exports of these
products to Canada were worth nearly $9 million in 2014;

leather and sack kraft paper exported to Mexico on entry into force of the TPP. In 2014,
Australian exports to Mexico of leather were worth $7.8 million and sack kraft paper
were worth $3.1 million;

medicament exports to Mexico within 10 years of entry into force of the TPP. In 2014,
Australian exports of medicaments to Mexico were worth $4.4 million;

other manufactured products exported to Mexico within 15 years of entry into force of
the TPP. Australia exports of these products to Mexico were valued at over $159 million
in 2014;

iron and steel products exported to Vietnam within 10 years of entry into force of the
TPP; Australian exports of these products to Vietnam were worth over $200 million in
2014;

automotive parts to Vietnam within 10 years of entry into force of the TPP.

pharmaceutical exports to Peru within 10 years of entry into force of the TPP, with
tariffs on priority products eliminated upon entry into force;

paper and paperboard products exported to Peru within 10 years of entry into force of
the TPP;

In the TPP, Malaysia has also committed to provide guaranteed access for Australian providers to
engage in the wholesale distribution of automotive parts and components.
57 per cent, ABS Data on the DFAT STARS Database

14

III.

Outcomes: Services market access

Australias services exports to TPP countries were worth over $20 billion in 2014 (almost 35 per cent of
total Australian services exports). The TPP will create a platform for growth in these exports by
removing key barriers and providing Australian service suppliers with more transparent and predictable
operating conditions.
By locking in existing market conditions in a number of key sectors, the TPP will provide certainty for
Australian businesses operating overseas. The TPP will also capture future market reforms in services
sectors, meaning that any liberalisation will flow through to Australian service providers.
Financial services
Highlights of TPP market access outcomes for Australian financial services exporters include:

Guaranteed market access in all TPP countries for investment advice and portfolio management
services to collective investment schemes, as well as insurance of risks relating to maritime
shipping and international commercial aviation and freight;

Malaysia has agreed to remove all foreign equity caps. In addition, Australian insurance
providers will be able to offer product liability and directors and officers liability insurance to
Malaysians on a cross-border basis; and

Singapore has committed to allowing Australian companies to provide brokerage services, on a


cross-border basis, for insurance of maritime, aviation and transport-related risks.

For more information, refer to Outcomes: Financial Services


Professional, technical and other business services
Key TPP market access outcomes for Australian exporters of professional, technical and other business
services include:

Malaysia has agreed to lift its ban on lawyers providing advice on a fly-in fly-out basis;

Canada, Mexico, Malaysia, Peru, Brunei Darussalam and several additional US States (Arizona,
Indiana, Louisiana, Massachusetts, New Mexico, North Carolina, Missouri and Utah) have agreed
to offer guaranteed access to provide legal advice on contracts governed by Australian,
international or third party law on a fly-in, fly-out basis;

Guaranteed market access arrangements for engineers (including for integrated engineering
services), urban planners and architects (including landscape architectural services) in Brunei
Darussalam, Canada, Chile, Mexico and Peru; and

Malaysia has agreed to lock in current market access arrangements in the construction and
related engineering services sector, and also guaranteed that future market opening of these
sectors will be captured as a TPP commitment.

For more information, refer to Outcomes: Professional and Other Business Services
Education services
Key TPP market access outcomes for Australian exporters of education services include:

15

Commitments guaranteeing access to key existing markets and markets with growth potential
for Australian universities and vocational institutions to deliver education services, including
online education services;

Australian universities and vocational education providers will be able to pursue new
opportunities to establish or expand a campus or institution in Brunei Darussalam, Japan,
Malaysia, Mexico, Peru and Vietnam;

Australian universities and vocational education providers will be able to offer a wider range of
courses to Vietnamese students, including new and emerging technical disciplines;

Malaysia has agreed that international schools can be 100 per cent foreign owned; and

Vietnam has locked in the current percentage of Vietnamese students permitted to be enrolled
in international schools and guaranteed that any future reforms which increase that percentage
will be captured as a TPP commitment.

For more information, refer to Outcomes: Education Services


Mining services
Key TPP market access outcomes for Australian exporters of mining services include:

Mexico locking in recent reforms to the energy sector, enabling foreign companies, for the first
time, to bid to participate in the exploration, production, processing and refinement of oil and
gas;

Vietnam opening up and providing businesses with greater transparency regarding investment
in the mining sector;

Brunei Darussalam making first time commitments on investment in the mining sector, including
coal;

Brunei Darussalam and Vietnam locking in, for the first time, their investment regimes for oil,
gas and power development as well as future reforms providing existing and prospective
Australian investors with more transparent and predictable operating conditions;

Australian suppliers of mining-related consulting, research and development, engineering,


environmental, mining and technical testing and analysis services will achieve guaranteed access
through new commitments from Chile (additional to our bilateral FTA), Mexico and Peru;
and

Australias privately-owned mining, oil and gas companies will be able to compete on a more
level playing field with the large state-owned enterprises (SOEs) that dominate these sectors in
some TPP countries through TPP commitments on SOEs.

For more information, refer to Outcomes: Resources and Energy


Transport and logistics services
Key TPP market access outcomes for Australian exporters of transport and logistics services include:

Malaysia locking in its investment regime for freight transport and guaranteeing that any future
market reforms will flow through to Australian providers;

16

Vietnam locking in its current investment regime for road freight transport services and
guaranteeing that any future market reforms will flow through to Australian providers;

Vietnam locking in its investment regime in aviation (including the current 30 per cent foreign
equity limitation) and guaranteeing that any future reforms will flow through to Australian
airlines established in the Vietnamese market; and

Japan guaranteeing market access for Australian suppliers of ground-handling services and
offering commitments, which will provide Australian service suppliers and investors with greater
certainty regarding investment conditions in airports and the supply of airport operation
services by foreign providers.

For more information, refer to Outcomes: Transport and Logistics


Health
Key TPP market access outcomes for Australian exporters of health services include:

Commitments from Malaysia, Mexico and Vietnam will give Australian providers of private
health and allied health services with greater certainty regarding access and operating
conditions in these markets; and

New government procurement opportunities to provide health services in Brunei Darussalam,


Malaysia and Peru.

For more information, refer to Outcomes: Health


E-Commerce and telecommunications
State of the art outcomes on e-commerce and telecommunications will deliver significant benefits to
Australian businesses and consumers by fostering greater competition, trade and investment between
TPP countries. The TPP will not alter Australias broadcasting regime, or the ability of the Australian
governments to support Australias cultural industries. E-commerce outcomes are consistent with
Australias regulatory framework, including Australias e-health record system and Privacy Act.
Key e-commerce and telecommunications outcomes include:

A guarantee not to prevent service suppliers and investors from transferring data across borders
where it is part of business activity;

Businesses will not be forced to build data storage centres, or use local computing services, in
TPP countries where they wish to conduct business;

Legal protection for consumers across TPP markets to protect privacy, enforce consumer
protection rights, and combat spam messages;

TPP countries have agreed to work cooperatively to promote reasonable international mobile
roaming rates. TPP countries can enter into arrangements with each other on rates and
conditions for wholesale international mobile roaming services; and

Australian providers stand to benefit from the phasing out of foreign equity limits in Vietnam's
telecommunications sector five years after the entry into force of the TPP. They will also be able
to apply to wholly own telecommunications ventures in Malaysia.

For more information, refer to Outcomes: Trade in the digital age


17

Temporary entry of business persons


The TPP commitments on temporary entry of business persons will help facilitate increased trade and
investment between TPP countries, enabling business people to enhance their commercial relationships
and pursue new opportunities.
Australia is offering temporary entry to business persons on a reciprocal basis to those TPP countries
offering similar substantive levels of access for Australian business persons.
Australias TPP commitments are consistent with Australias existing immigration and workplace
relations frameworks and the approach taken in other free trade agreements.
Highlights of key TPP outcomes for Australia with regard to temporary entry of business persons
include:

Australian intra-corporate transferees will benefit from guaranteed initial lengths of stay in TPP
countries of between one and five years, without being subject to quotas or economic needs
tests;

Australian business persons who possess specialist trade, professional and technical knowledge,
and offer services on a contractual basis will benefit from guaranteed initial lengths of stay in
TPP countries of between three months and five years, without being subject to quotas or
economic needs tests; and

Australian business persons pursuing opportunities in TPP countries and wishing to stay for a
short period of time (short-term business visitors) will benefit from greater certainty on length
of stay, including for up to three months in Chile (extendable), Japan (extendable), Malaysia and
Singapore; for up to six months in Canada, Mexico, Peru and Vietnam; and up to 12 months in
Brunei Darussalam.

For more information, refer to Outcomes: Temporary Entry of Business People.


* Note that some outcomes specific to Vietnam remain to be formalised

18

Trans-Pacific Partnership Australian Services and Investment


In 2014:
34% of Australia's services exports worth $21 billion were to the 11 Trans-Pacific Partnership
countries
45% of the total stock of Australian foreign investment is in the 11 Trans-Pacific Partnership
countries
Australian services exporters and investors will benefit from a range of new opportunities
E-commerce
Education
Finance
Mining and Energy
Professional and other business services
Telecommunications
Temporary entry for business people

Transport and logistics


19

IV.

Outcomes: Investment

Benefits of foreign investment to Australia


As a large country with a relatively small population, Australia relies on foreign investment to
supplement domestic capital.
Foreign investment has helped Australia become the worlds 12th largest economy, with 24 years of
uninterrupted growth. Foreign investment has enabled Australians to enjoy higher rates of economic
growth, employment and standards of living than could have been achieved with domestic capital
alone. In 2014, around 40 per cent of the total stock of foreign investment in Australia (valued at
approximately $1.1 trillion) was from TPP countries.
Foreign investment helps Australia reach its economic potential by financing new industries and
enhancing existing industries, boosting infrastructure, productivity and employment opportunities in the
process.
The TPP will also promote further foreign investment in Australia by liberalising the screening threshold
at which private foreign investments in non-sensitive sectors are considered by the Foreign Investment
Review Board, increasing the threshold from $252 million to $1,094 million for all TPP countries. Under
the TPP, Australia retains the ability to screen investments in sensitive sectors to ensure they are not
contrary to the national interest. All proposed investments by foreign governments will continue to be
examined and lower screening thresholds of $15 million and $55 million will apply to investment in
agricultural land and agribusiness respectively.
Foreign investment creates jobs more than one in five businesses in Australia with 200 or more
employees have greater than 50 per cent foreign ownership. Foreign investment stimulates economic
activity research has found that a 10 per cent increase in foreign investment in Australia could lead to
a more than one per cent increase in GDP by 2020. Creating new businesses with connections in
different markets, foreign investment opens up additional export opportunities, helping to boosting our
overall export performance.
Benefits for Australian investors
Australian investment in TPP countries more than doubled in the last decade to reach $868 billion in
2014, a rise of 16 per cent over the previous year. Australian investment in TPP countries is 45 per cent
of all outward Australian investment.
The TPP will promote further growth and diversification of Australian outward investment by opening
up to lucrative and growing market sectors such as mining and resources, telecommunications and
financial services. Australian investors will also benefit from preferential investment screening
thresholds in the TPP.
The TPP Investment Chapter contains a suite of rules that will provide additional protection to Australian
investors operating in TPP markets. These protections include a minimum standard of treatment, the
right to compensation for certain types of expropriation and protection against discrimination (see
below). The Investor-State Dispute Settlement (ISDS) mechanism will provide Australian investors with
the ability to enforce these protections in many of Australias key capital export markets, as well as
many of the rapidly growing economies in the Asia-Pacific region.

20

Table 1: Total investment in Australia from TPP countries and total Australian investment in TPP
countries in 2014
Table 1: Total investment in Australia from TPP countries and total
Australian investment in TPP countries in 2014
Total investment in
Australia from TPP
countries ($m)

Total Australian
investment in TPP
countries ($m)

Brunei
Darussalam

68

NA

Canada

35,236

45,403

Chile

NA

3,118

Japan

174,676

69,645

Malaysia

20,994

9,604

Mexico

NA

5,273

New Zealand

38,523

99,927

Peru

NA

NA

Singapore

80,207

50,715

United States

758,153

575,514

Vietnam

583

1,196

TPP investment chapter


Investment rules are included in trade agreements like the TPP because of the importance governments
attach to guaranteeing the high standards of governance that are pivotal to attracting and sustaining
foreign investment.
Investments include shares and stocks, enterprises and tangible and intangible property.
TPP investment rules:

protect against discriminatory treatment;

require payment of compensation in certain circumstances where an investment is


expropriated;

require that investment-related capital transfers can occur freely and without delay; and

guarantee that investors and their investments will be accorded a minimum standard of
treatment in accordance with the applicable customary international law standard, which
includes an obligation to provide due process in court proceedings.

21

The TPP Investment Chapter contains an ISDS mechanism which provides investors with access to an
independent arbitral tribunal to resolve disputes for breaches of these investment rules or the similar
investment-related rules in the Financial Services Chapter.
An ISDS claim concerning the TPP may only be brought in relation to commitments in the Investment
Chapter and a limited number of commitments in the Financial Services Chapter. The mechanism also
enables an investor to initiate arbitration proceedings in relation to disputes over investment
agreements and authorisations in certain limited circumstances.
The ISDS mechanism contains explicit safeguards protecting the Australian Governments right to
regulate in the public interest.
What ISDS safeguards have been included?
The TPP Investment Chapter contains a set of high-quality, modern rules governing the treatment of
investors and their investments, balanced with robust safeguards to preserve the right of the
Government to continue regulating in the public interest. As a result:

there is explicit recognition that TPP Parties have an inherent right to regulate to protect public
welfare, including in the areas of health and the environment;

Australias tobacco control measures cannot be challenged;

certain ISDS claims in specific policy areas in Australia cannot be challenged, including:
o

social services established or maintained for a public purpose, such as social welfare,
public education, health and public utilities

measures with respect to creative arts, Indigenous traditional cultural expressions and
other cultural heritage

Australias foreign investment policy, including decisions of the Foreign Investment


Review Board.

non-discriminatory regulatory actions to safeguard public welfare objectives, such as public


health, safety or the environment, do not constitute indirect expropriation, except in rare
circumstances;

the fact that a subsidy or grant has not been issued or renewed, or has been reduced, does not
breach the Minimum Standard of Treatment obligation, even if it results in loss or damage to
the investment. This includes subsidies issued under Australias Pharmaceutical Benefits
Scheme;

government action which may be inconsistent with an investors expectations does not
constitute a breach of the Minimum Standard of Treatment obligation, even if it results in loss
or damage to the investment.

The ISDS mechanism in the TPP also includes procedural safeguards to enhance the arbitration
process. These include:

a requirement that hearings will be open to the public, and that documents filed in the
arbitration, as well as the tribunals decision, will be made public;

a right for any TPP Party that is not involved in an ISDS case to make oral and written
submissions;
22

the ability to permit submissions from interested individuals, including from civil society
and non-governmental organisations;

a requirement that the burden of proof rests with the claimant to establish its claim against a
government, which similarly directs tribunals to decide cases in accordance with established
interpretations of investment commitments;

rules preventing a claimant pursuing a claim in parallel proceedings, such as before an Australian
court;

expedited review of claims that are baseless, or manifestly without legal merit;

TPP Parties are able to issue interpretations of the Agreement, which must be followed by ISDS
tribunals;

there are mechanisms to disincentivise unmeritorious claims, such as through the award of
costs against a claimant and the ability for a respondent government to recoup costs;

interim review and award challenges;

time limits on bringing a claim;

a requirement for arbitrators to comply with rules on independence and impartiality, including
on conflicts of interests.

23

V.

Outcomes: Biologics

For the first time in a trade agreement, the TPP contains intellectual property rights and other specific
protections for biologics, a rapidly-evolving class of medicines that treat difficult to cure diseases and
illnesses, such as cancer. Importantly, this does not change Australias existing 5 years of data protection
for biologics or any other part of our health system, and will not increase the cost of medicines.
Australia is recognised internationally as a leading hub for investment in research and development
(R&D), and its bio-pharmaceuticals industry includes around 50 global research-based pharmaceutical
companies and more than 400 locally-owned medical biotechnology firms operating in Australia. They
employ in excess of 40,000 highly-skilled Australians, generate nearly $4 billion in exports each year and
invest over $1 billion in R&D. The TPP will provide incentives for innovation, spurring new scientific and
technological discoveries, and creating a more attractive trade and investment environment for the
pharmaceutical sector.
What is a biologic?
A biologic is a type of highly complex medicine created by biotechnology processes. Examples include
many cancer medicines, and medicines that treat chronic conditions such as rheumatoid arthritis.
Biologics differ from traditional small molecule medicine (which are derived from chemical synthesis)
and are more expensive to develop. The generic or follow-on version of a biologic is called a
biosimilar.
How does Australia protect biologics?
In Australia, new and inventive biologics are protected, like other medicines, via the patent system
which provides 20 years of protection, with an extension of up to 5 years for delays in the approval
process.
Before a medicine can be supplied in Australia it must be approved by the Therapeutic Goods
Administration (TGA). As part of the approval process, the applicant seeking approval for an innovator
medicine must submit the information it has generated to demonstrate the products safety and
efficacy, such as clinical trial data. Australian law provides 5 years of data protection for the innovators
information from the date of regulatory approval of the medicine by the TGA. During this period, the
information cannot be used by the TGA to approve a generic version of that medicine, or a biosimilar
version (when the medicine is a biologic). When the data protection expires, the TGA can approve a
generic or biosimilar medicine relying on the innovators information, so a generic or biosimilar can
enter the market as soon as any relevant patent expires. This remains unchanged as a result of the TPP.
There are over 100 biologics approved in Australia that would be covered by the TPP provision. There
are currently over 70 biologics listed on the PBS and 4 biosimilars.
What is the TPP outcome on biologics?
The TPP recognises the importance of effective protection in the market for biologics, and that this can
be achieved by different means.
The TPP has a two-track outcome on biologics protection. Parties can choose to provide effective market
protection though at least 8 years of data protection. Alternatively, Parties can choose to provide
effective market protection through at least 5 years of data protection, along with other measures,
including existing measures in the case of Australia, and recognising market circumstances. These

24

measures and circumstances include regulatory settings, patents, and the time it takes for follow-on
medicines to become established in the market. Australia will follow the 5 year option, which reflects
our current system and requires no changes. This acknowledges that different tracks can deliver
comparable outcomes.
The TPP allows transition periods for countries that need to change their laws in order to comply with
the TPPs provisions on biologics. As Australia does not need to do so, Australia is not among those
countries listed as being in this category.
Recognising that countries have limited experience with biosimilars, which are only just coming to
market, TPP Parties have also agreed to consult after ten years, or otherwise decide to review the TPP
provisions on biologics, with a view to providing effective incentives for the development of biologics, as
well as to facilitate timely access to medicines, including biosimilars. The consultation and review
provisions do not pre-judge any outcome, but provide a useful opportunity to assess the situation at the
time, which will support evidence-based policy making in an area subject to rapid scientific change.
What does this mean for Australia?
In the TPP, Australia has negotiated protections that are consistent with existing Australian law and
practice. Australia is not required to change any part of its current law, including data protection for
biologics, or our patent regime. There will be no adverse impact on the Pharmaceutical Benefits Scheme
and no price increases for medicines.

25

VI.

Outcomes: Resources and energy

The TPP will eliminate tariffs on key Australian minerals, petroleum and LNG exports and lock them in at
zero. The TPP will also create major new opportunities for Australian miners and oil and gas companies
to find and develop reserves in the region. Australias cutting-edge suppliers of Mining Equipment,
Technologies and Services (METS) and oilfield goods and services also stand to benefit considerably from
the TPP, which will facilitate the expansion of exports.
Key outcomes#
Australian resources and energy exports
Close to 30 per cent, or almost $47 billion, of total Australian exports of resources and energy products
in 2014 were exported to TPP countries. The TPP delivers certainty and significant gains to Australian
producers and exporters of resources and energy products. In addition to locking in the duty- and
quota- free access Australia currently enjoys into a number of TPP markets for major exports such as
coal, iron ore and liquefied natural gas, key market access gains include:

elimination of Vietnams tariffs on butanes, propane and liquefied natural gas within 7 years of
entry into force. Australian exports of these products to Vietnam were valued at $9 million in
2014;
elimination of Vietnams 20 per cent tariff on petroleum - Australian petroleum exports to
Vietnam were $11 million in 2014 TPP; and
elimination of Perus tariffs on iron ore, copper and nickel upon entry into force of the TPP.

New exploration, extraction and production opportunities


Mining and energy exploration efforts are centred on the Asia-Pacific region. The five North and South
American members of the TPP (Canada, Chile, Mexico, Peru and the United States) accounted for an
estimated 40 per cent of worldwide exploration budgets in 2014 and Australia a further 12 per cent.1
TPP countries, many for the first time, have committed to lock in current access and recent landmark
reforms, as well as guaranteeing that future reforms of their investment regimes for mining and energy
reserves will automatically flow through to other TPP countries. Key outcomes for Australian miners
and oil and gas companies include:

Vietnam opening up and providing businesses with greater transparency regarding


investment in its mining sector;

Mexico allowing foreign companies, for the first time, to participate in Mexicos energy
sector;

Note that some outcomes specific to Vietnam remain to be formalised.


Source: SNL Metals & Mining

26

Canada allowing Australian investors to apply for an


exemption from the 49 per cent foreign equity limit
on foreign ownership of uranium mines, without first
seeking a Canadian partner;

Brunei Darussalam and Malaysia making first-time


commitments on investment in the mining sector,
including coal;

Brunei Darussalam and Vietnam locking in, for the


first time, their investment regimes for oil, gas and
power development and future reforms providing
existing and prospective Australian investors with
more transparent and predictable operating
conditions; and

Prohibitions on the introduction of new export taxes


and commitments for the elimination of existing
export taxes in Malaysia and Vietnam, providing
greater certainty for Australian mining and energy
companies operating in these countries.

The TPPs ground-breaking new rules on state-owned enterprises


(SOEs) will level the playing field between Australias privately-owned
mining, oil and gas companies and the large SOEs that dominate
these sectors in some TPP countries. The TPP will help ensure that
TPP Parties do not provide financial support to their SOEs that would
give them an unfair advantage over their Australian competitors.
Mining Equipment, Technologies and Services (METS) and energy
services

Spotlight on Mexico

The liberalisation of Mexicos oil


and gas and electricity sectors to
foreign participation is expected to
attract up to $30 billion of
additional foreign investment per
year.*

Australian companies will, for the


first time, be able to bid to
participate in the exploration,
production, processing and
distribution of oil, gas and
geothermal resources in Mexico.

Mexico has locked in its local


content requirements and any
future reforms, including as they
apply to PEMEX.

Australian oilfield goods and


services suppliers, engineers,
lawyers and other professional
services suppliers will also be well
placed to benefit as foreign
investment in these sectors
increases.

Australian suppliers will be able to


bid for government procurement
opportunities with PEMEX.

Australias cutting-edge providers of METS and oilfield goods and


services are at the forefront of delivering a diverse range of
innovative products and services across the mining and energy
* Source: IMF Selected Issues Paper:
supply chain, including exploration, extraction, engineering,
Mexico, November 2014, p.14
processing, power generation, environmental management, safety,
research and development, education and training and community engagement.
Over 50 per cent of companies in Australias $90 billion METS sector export their goods and services,
with current exports exceeding $27 billion or approximately 30 per cent of the sectors revenues.2 The
TPP will support and facilitate the expansion of exports by Australian METS and oilfield service providers
into South-East Asia and North and South America. Key outcomes include:

Australian manufacturers and exporters of mining equipment will benefit from dutyfree access for their exports to TPP countries. The TPP will eliminate tariffs of up to

Source: AusTrade, Austmine

27

15 per cent on Australian exports of mining equipment to Mexico, and will bind
tariffs at zero in countries where Australian exports already have duty-free access;

Brunei Darussalam Mexico and Vietnam have, for the first time, made commitments
guaranteeing access for Australian METS and oilfield goods and services providers to
deliver cutting-edge goods, services and technologies to these markets;

Ambitious new commitments from Chile (additional to our bilateral FTA), Mexico and
Peru on the provision of consulting, research and development, engineering,
environmental, mining and technical testing and analysis services will deliver
certainty regarding access for Australian suppliers active in these sectors;

Australian companies will benefit from new rules that help to ensure that they will
not be discriminated against when competing for contracts to supply their goods and
services. Some of Australias METS and oilfield service providers biggest customers
are large SOEs such as PEMEX (Mexico) and VINACOMIN; and

For the first time, Australian suppliers will be able to bid for government
procurement opportunities with PEMEX and PETROPERU and entities in Perus
government-owned electricity and hydro power sectors.

Streamlined investment processes and greater protections


Greater investment protections and streamlined processes will help propel investment by Australian
miners, oil and gas companies, METS and oilfield goods and service providers in TPP countries.
TPP countries have committed not to introduce new foreign investment screening regimes or have
extended higher preferential investment screening thresholds to Australian investors. Australian
investments into Canada of below C$1.5 billion (currently $369 million) will be exempt from investment
screening processes.
The TPP will also promote further growth of foreign investment in resources and energy in Australia by
increasing the screening threshold at which private foreign investments in the mining and energy
sectors are considered by the Foreign Investment Review Board (FIRB) from $252 million to $1,094
million for all TPP countries (except in relation to uranium and plutonium extraction and nuclear
facilities).
Temporary entry arrangements for professionals and employees
Australian companies will be able to transfer executives and managers more easily to work in TPP
countries for extended periods and to obtain visas for Australian contractors working on a temporary
basis.
Independent Australian professionals and technicians providing services to the mining, oil and gas
sectors will enjoy certainty over visa arrangements and periods of stay in Brunei Darussalam, Canada,
Chile, Malaysia, Mexico, Peru and Vietnam. These countries have also guaranteed that Australian
installers and servicers of niche mining- and oilfield-related manufactured goods and technologies will
be able to temporarily enter these markets to undertake installation and maintenance activities.

28

VII.

Outcomes: Education services

The TPP provides a strong platform to expand Australian education and training services exports to TPP
countries, including priority markets in South East Asia and Latin America. This covers courses delivered
online by Australian institutions, Australian education professionals working overseas, foreign students
studying at an Australian educational institution or a combination of these methods.
Australias education-related travel services exports in 2014 were worth $17.0 billion, with exports to
TPP countries accounting for 17.4 per cent of these services (valued at $3.0 billion). In 2014, Vietnam
and Malaysia were Australias 3rd and 5th largest education services export markets respectively.
Education services provided to international students have broad economic benefits beyond tuition
fees. In 2014, onshore international education activity contributed $17 billion to the economy.
Key outcomes#
Online education
Online education presents a growing opportunity to provide greater numbers of students with flexible,
high-quality and internationally-recognised skills and qualifications. Australian universities and
vocational institutions are well-placed to deliver education services, including online education services,
and will benefit from guaranteed access to most TPP markets and significant new opportunities in
markets where online learning is at an early stage of development.
University campuses and vocational education
Australian universities and vocational education providers will be able to offer a wider range of courses
to Vietnamese students, including new and emerging technical disciplines.
Australian universities and vocational education providers seeking to establish or expand a campus or
institution will also benefit from commitments offered by Brunei Darussalam, Japan, Malaysia, Mexico,
Peru and Vietnam that will lock in existing market openness and guarantee that future liberalisation will
be captured as a TPP commitment.
International schools
Australian providers of international school services will benefit from the following commitments by TPP
countries:

Malaysia has guaranteed that international schools can be 100 per cent foreign owned,
improving on commitments under the Malaysia Australia Free Trade Agreement (MAFTA);

Vietnam has locked in the current percentage of Vietnamese students permitted to be enrolled
in international schools and guaranteed that any future market reforms which increase the
percentage of Vietnamese students permitted in international schools will be captured as a TPP
commitment; and

Brunei Darussalam, Malaysia, Mexico, Peru and Vietnam have guaranteed access for Australian
international schools.

Australian teachers, academics and other staff of education institutions


The TPP will deliver improved access for Australian teachers, academics and other staff of education
institutions. Highlights include:

29

Australian universities and vocational education providers will be able to transfer faculty and
other staff to offshore campuses for extended periods;

Independent Australian education professionals seeking contracts to work at overseas


education institutions will have guaranteed access with streamlined visa arrangements and
longer periods of stay, including in Vietnam, Malaysia and Mexico;

Japan has offered commitments additional to the Japan-Australia Economic Partnership


Agreement (JAEPA), which will guarantee access for Australian academics to take up teaching
and research positions at Japanese universities and technology colleges; and

Independent Australian education marketing professionals and education consultants will be


guaranteed access to temporarily work in Malaysia.

Government Procurement
Australia education service providers will now be able to bid for government procurement contracts in
TPP countries, including:

primary, secondary, and higher education services in Brunei Darussalam, Japan, Canada,
Malaysia, Mexico and Peru;

adult education services in Brunei Darussalam, Canada, Japan, Malaysia and Peru; and

research and development services in Brunei Darussalam and Peru.

# Note that some outcomes specific to Vietnam remain to be formalised.

30

VIII. Outcomes: Professional services


Australian professional service providers are important contributors to the Australian economy, with
exports including world-class legal, accounting, engineering, architecture, surveying and urban planning,
and research and development services.
Australian exports of professional, technical and other business services to TPP countries were valued at
$4.7 billion in 2014, which accounted for 53 per cent of total exports of these services (valued at $8.8
billion in 2014).
The TPP provides a strong platform for continued growth in Australian exports of professional, technical
and other business services. It will remove key barriers, provide for more transparent and predictable
operating conditions in TPP countries, and enable suppliers to benefit from future market reforms.
TPP countries have also agreed to work cooperatively to foster enhanced recognition of professional
qualifications, and improved licensing and recognition arrangements in professional services sectors.
Key outcomes3
Legal services
Australian lawyers and law firms will benefit from the following commitments by TPP countries:

Brunei Darussalam, Mexico, Malaysia, Peru and several American States (beyond those
covered in our bilateral free trade agreement - Arizona, Indiana, Louisiana,
Massachusetts, New Mexico, North Carolina, Missouri and Utah) have guaranteed
access for Australian lawyers to provide advice on contracts governed by Australian,
international or third party law on a fly-in, fly-out basis. The ability to provide legal
services on this basis will be an enabler of increased legal services exports to these TPP
countries, including as a precursor to Australian firms establishing overseas offices;

Malaysia has agreed to open up its legal services sector so that:

Australian lawyers will be able to provide legal advice on contracts governed by


Australian, international or third party law on a fly-in, fly-out basis, following
Malaysias recent removal of a ban;

Australian law firms will be able to practice aspects of Malaysian law through a
Qualified Foreign Law Firm (a firm which may be 100 per cent foreign owned) or
an International Partnership with a Malaysian firm;

Australian lawyers will be able to practise in a Malaysian law firm, Qualified


Foreign Law Firm and an International Partnership with a Malaysian firm; and

The benefits of any future reforms in the Malaysian legal services sector will
automatically flow to Australia as a TPP commitment.

Greater certainty regarding the operating conditions in Vietnams legal services sector,
including clarification that Australian lawyers and legal firms will be permitted to work
on contracts in Vietnam;

Note that some outcomes specific to Vietnam remain to be formalised.

31

Australian law firms will be able to bid for government procurement contracts for legal
services in Brunei Darussalam, Canada and Peru; and

Australian lawyers will be guaranteed the ability to temporarily enter and work in TPP
countries, including the ability to transfer partners and lawyers to work in offshore
offices for temporary periods and for independent Australian lawyers to work in Canada
and Malaysia without being subject to labour market testing.

Construction, architecture, engineering and surveying services


Australian providers of construction, architecture, engineering and surveying services will benefit from
the following commitments:

Malaysia has agreed to remove a number of operating restrictions for architecture,


engineering and quantity surveying service providers, including removal of the
requirement for architects, engineers and quantity surveyors to be Malaysian citizens to
provide these services in Malaysia. Future reforms of these sectors by Malaysia will be
captured as a TPP commitment benefiting Australian service suppliers;

Malaysia has agreed to lock in current market access arrangements in the construction
and related engineering services sector, and guaranteed that future reforms of these
sectors will be captured as a TPP commitment benefiting Australian service suppliers;

Australia has secured first-time commitments which guarantee access arrangements for
Australian engineers (including for integrated engineering services), urban planners and
architects (including landscape architectural services) in Brunei Darussalam, Canada,
Chile, Mexico and Peru;

Australian architecture, engineering and other technical service suppliers will be able to
bid for government procurement contracts in Brunei Darussalam, Canada, Malaysia,
Mexico, Peru and Vietnam; and

Australian construction service suppliers will be able to bid for government


procurement construction projects in Brunei Darussalam, Canada, Mexico, Peru and
Vietnam.

Major new opportunities for those providers offering services in the mining and energy
sectors. For more information refer to Outcomes: Resources and Energy

Accounting and auditing services


Australian providers of accounting, auditing and book-keeping services will benefit from the following
commitments:

All TPP countries have guaranteed that they will maintain existing access in accounting,
auditing and book-keeping services, and will not introduce new measures that
discriminate against, or limit the licenses available to, Australian service suppliers;

Future reform in the auditing sector by Brunei Darussalam will be captured as a TPP
commitment;

Guaranteed access for Australian providers of taxation services in key markets; and

32

Australian suppliers will be able to bid for government procurement contracts for
accounting, auditing and book-keeping services, along with taxation services contracts,
in Brunei Darussalam, Canada, Malaysia, Mexico, Peru and Vietnam.

33

IX.

Outcomes: Financial services

Financial services, including banking, insurance and funds management, is one of the most dynamic
sectors of the Australian economy. Total Australian cross-border exports of financial services rose to
$3.3 billion in 2014, with exports to TPP countries accounting for 31 per cent of the total (or
approximately $1 billion).
The TPP presents an important opportunity to increase Australias cross-border exports, as well as to
help reduce the regulatory restrictions on Australian firms established in, or looking to enter, TPP
countries.
Key outcomes4
Cross-border financial services
The TPP delivers new opportunities for Australian financial service providers to participate in TPP
markets by guaranteeing the ability to provide a range of financial services on a cross-border basis,
including:

investment advice and portfolio management services to collective investment


schemes; and

insurance of risks relating to maritime shipping and international commercial aviation


and freight, and brokerage thereof.

Credit, debit and other payment card transactions have become an integral part of doing business in
Australia and around the world. In the TPP, countries have committed to allowing the supply of
electronic payment services for payment card transactions into their countries on a cross-border basis.
Reducing behind the border restrictions
The TPP will help ease some of the regulatory burdens Australian firms face when exporting financial
services to, or operating in, TPP countries. For example, TPP includes provisions that:
-

promote transparency and consultation with industry when a regulatory change is being
introduced; and

encourage the streamlining of approvals for the issuance of new insurance products.

In addition, TPP countries have committed to permitting financial institutions to transfer information
into and out of their countries for data processing subject to certain conditions including the
protection of privacy and confidentiality.
Regulatory integration
Duplicative licensing regimes can inhibit or prevent Australian financial services being offered in other
countries. The TPP includes provisions that help facilitate the recognition of Australian financial service
licence holders in TPP countries so as to avoid duplicative licensing requirements.
Facilitating professionals working abroad
The TPP creates more opportunities for Australian professionals in the financial sector to work in TPP
countries, which is of particular value in light of the increasing presence of Australian firms overseas.
4

Note that some outcomes specific to Vietnam remain to be formalised.

34

Australian financial institutions will be guaranteed the ability to transfer managerial and specialist staff
to offshore branches and offices for extended periods. In addition, independent Australian
professionals in the sector will enjoy certainty over visa arrangements and periods of stay into Malaysia,
Vietnam, Canada, Peru and Mexico.
Some countries place restrictions on the number of foreign persons that can occupy senior managerial
positions or sit on the board of directors of a financial institution. The TPP puts a cap on these
restrictions, enabling Australian professionals to occupy such positions in financial institutions in TPP
countries.
Market access outcomes in South East Asia
In South East Asia, where Australian financial institutions are already active participants, key TPP
financial services market access outcomes include:

Malaysia has agreed to replacing its foreign equity caps with a screening regime. In
addition, Australian insurance providers will be able to offer product liability and
directors and officers liability insurance to Malaysians on a cross-border basis;

Singapore has committed to allowing Australian companies to provide brokerage


services, on a cross-border basis, for insurance of maritime, aviation and transportrelated risks.

Retaining the ability to regulate in Australias interests


Each country needs to be able to regulate its financial services sector, not only in times of crisis, but also
in the day-to-day functioning of its financial system. The TPP contains provisions that safeguard
Australias right to introduce and maintain measures for prudential reasons, including to protect
depositors and policy holders, and to ensure the stability of our financial system. The TPP will not affect
Australias four-pillar banking policy.

35

X.

Outcomes: Transport and logistics

As supply chains for the production of goods become more complex, businesses are increasingly looking
to outsource elements of their transport and logistics activities to specialist third party providers. The
TPP will provide further opportunities for Australian transport and logistics businesses to capitalise on
this trend.
Australias transport and logistics services exports to TPP countries were valued at $2.8 billion in 2014,
which accounted for 42 per cent of total Australian exports of transport and logistics services (valued at
$6.6 billion).
The TPP will contribute to growth in Australian transport and logistics services through the removal of
key barriers, provision of more transparent and predictable operating conditions in TPP countries, and
by capturing future market reforms in TPP countries.
Key outcomes
Duty free entry for pallets and containers
For the first time in an Australian free trade agreement, the temporary entry of containers and pallets
involved in transporting goods will be given duty free entry. This will eliminate considerable costs for
Australian exporters and transport companies, currently paying duties as high as 20 per cent in some
TPP countries.
Road and Freight Transport
Australian freight and logistics companies will benefit from enhanced commitments that support
integrated logistics supply chains. For the first time, Australian providers of transport and logistics
services in key South East Asian markets will gain strong trade and investment protections with:

Malaysia guaranteeing its current investment regime for freight transport (with a
foreign equity limitation of 49 per cent) and guaranteeing that any future market
reforms will flow through to Australian providers;

Vietnam locking in its current investment regime for road freight transport services
(including the foreign equity limitation of up to 51 per cent) and guaranteeing that any
future market reforms will flow through to Australian providers; and

Australian suppliers will also have new opportunities to bid for government contracts
for land and sea freight services in Malaysia, Brunei Darussalam and Peru.

Aviation
A number of TPP countries - New Zealand, Malaysia, Brunei and Vietnam - have government-owned
airlines. The TPP Agreement contains ground-breaking rules on state-owned enterprises (SOEs) and
designated monopolies that will help ensure that such airlines are not provided with non-commercial
assistance, such as subsidies, that have an adverse effect on competition with privately-owned airlines.
These disciplines will help ensure that airlines, such as Qantas, are able to compete on a more level
playing field with government-owned airlines of TPP countries.
Most TPP Parties have committed to guaranteeing their existing investment regimes in aviation and
guaranteeing that any future reforms will automatically flow through to TPP Parties, enabling Australian
airlines to benefit from current and future openness in aviation markets.
36

Significantly, Australia has secured commitments from Vietnam to lock in its investment regime in
aviation (including the 30 per cent foreign equity limitation) and guarantee that any future reforms will
flow through to Australian airlines established in the Vietnamese market.
Enabling services in the air transport sector
The TPP will cover a broader range of air transport-related service sectors than previous free trade
agreements. Given that air transport-related services can increasingly be provided on a cross-border
basis, this has particular value, including in the following areas in which Australian providers have strong
expertise:

Specialty air services such as flight training and parachute jumping;

Services related to the design and operation of airports; and

Ground-handling services such as baggage handling and flight catering.

In commitments extending beyond what it offered under the Japan-Australia Economic Partnership
Agreement (JAEPA), Japan has guaranteed market access for Australian suppliers of ground handling
services and offered commitments which will provide Australian service suppliers with greater certainty
regarding the operating conditions for the supply of airport operation services. Australia has also
secured these commitments for the first time from Chile and Mexico.
Australia has secured commitments on commercial flight training from Brunei Darussalam, Chile, Japan,
Mexico, New Zealand, Peru, the US and Vietnam, giving Australian providers opportunities to expand in
TPP countries.
Australian suppliers will also have new opportunities to bid for government contracts for air transport
services in Brunei and Peru, and air freight services in Brunei, Malaysia and Peru.
Transport infrastructure and supporting services
Logistics and supporting transport services, such as transportation document preparation services, cargo
handling, storage and warehousing, materials and stock management, packing, freight brokerage and
freight inspection services are key elements to efficient, integrated and seamless supply chains.
Australian suppliers of these services to the maritime, road and rail sectors will benefit from enhanced
access to the markets of TPP countries.
Australian suppliers will have new opportunities to bid for government contracts in supporting transport
services, such as cargo handling, storage and warehousing services in Brunei Darussalam, Malaysia and
Peru.
Simpler customs procedures
The TPP promotes high quality standards for the treatment of express shipments, such as courier
services. It encourages the provision of information before a shipment arrives, minimal documentation
requirements and the rapid release of express shipments to the final destination.
The TPP also encourages the adoption of simplified customs procedures that will reduce the time taken
to clear goods. This includes allowing advance electronic submission and processing of customs
information and allowing goods to be released before the final determination of customs duties.

37

XI.

Outcomes: Temporary entry of business persons

Reciprocal TPP commitments on temporary entry of skilled business persons will support greater trade
and investment opportunities in the Asia-Pacific. The ability for business persons to move across
borders is an integral feature of modern business and a crucial contributor to the growth of commercial
relationships.
Australian citizens and permanent residents who are business persons seeking temporary entry into a
TPP country under the following categories will benefit from enhanced certainty on entry and length of
stay, reduced barriers to labour mobility, and preferential temporary entry arrangements:

Intra-corporate transferees;

Contractual service suppliers, including professionals and technicians;

Investors and independent executives;

Installers and servicers of machinery and equipment; and

Short-term business visitors.

Australia has offered temporary entry commitments only to business persons from those TPP countries
that bind similar levels of access for Australian business persons in equivalent categories.
Australias TPP commitments are consistent with Australias existing immigration and workplace
relations frameworks and the approach taken in other free trade agreements.
Australias TPP commitments for intra-corporate transferees, contractual service suppliers and
independent executives will be implemented through the 457 visa programme, which is designed to
enable employers to address workforce needs by bringing in appropriately-skilled workers where they
cannot find a suitably-skilled Australian. In accordance with the 457 visa programme, employers will still
need to sponsor the temporary entry of skilled foreign workers, meet market salary rates and offer
employment conditions as required under Australia workplace law, and equivalent to those accorded to
Australian workers performing similar duties in the workplace. Skilled foreign workers will be required
to meet minimum qualification requirements, including any relevant skills testing and existing
professional licensing requirements at the Federal, State and Territory Government level.
Australias commitments on installers and servicers and short-term business visitors will be
implemented through Australias existing immigration frameworks.
Key outcomes5
Intra-corporate transferees
Australian intra-corporate transferees, being those business persons seeking to work in an overseas
branch of their office, will benefit from guaranteed initial lengths of stay in TPP countries of between
one and five years, without being subject to quotas or economic needs tests. Commitments offered by
other TPP countries include:

Canada will provide a guaranteed work permit or work authorisation with a waiver from
labour market testing (Labour Market Impact Assessment);

Note that some outcomes specific to Vietnam remain to be formalised.

38

Malaysia has agreed not to include a condition in the Malaysia-Australia Free Trade
Agreement (MAFTA) that restricts Malaysias commitments to three specialists or
experts per organisation;

Japan will provide for a greater length of stay, of up to five years (extendable), an
outcome that is an improvement on the equivalent Japan-Australia Economic
Partnership Agreement (JAEPA) commitment; and

Brunei Darussalam has agreed to commitments across all sectors, improving on its
commitments under the ASEAN-Australia-New Zealand Free Trade Agreement
(AANZFTA).

In return for TPP Parties offering access for Australian intra-corporate transferees, suitably-qualified
intra-corporate transferees from TPP countries will be able to stay in Australia initially:

For up to four years if they are executives and senior managers; and

Up to two years if they are specialists.

Contractual service suppliers, including independent professionals and technicians


Australian business persons who possess specialist trade, professional and technical knowledge and
offer services on a contractual basis will benefit from guaranteed initial lengths of stay in TPP countries
of between three months to five years without being subject to quotas or economic needs tests.
Commitments include:

Brunei Darussalam offering 2 years guaranteed stay for Australian contractual services
suppliers working in the oil and gas sector;

Canada providing a guaranteed work permit or work authorisation with a waiver from
labour market testing (Labour Market Impact Assessment) in a range of key professional
and technical occupations;

Malaysia offering commitments on professional services, education and financial


services as well as the removal of organisation-specific quotas. These commitments are
an improvement on Malaysias commitments under MAFTA;

Vietnam offering a longer period of stay in a broader range of sectors, including


education, legal, financial, telecommunications, architectural, engineering and services
incidental to mining, oil and gas. These commitments are an improvement on Vietnams
commitments under AANZFTA;

Mexico offering commitments on all professionals and on key technical occupations of


interest; and

Japan offering commitments relating to teaching and research positions at universities


and technology colleges. These commitments are an improvement on Japans
commitments under JAEPA.

In return for TPP Parties offering access for Australian contractual service suppliers, Australia will offer
contractual service suppliers from TPP countries the ability to stay for an initial period of up to 12
months.

39

Investors and independent executives


Australian investors and independent executives will benefit from guaranteed lengths of initial stay in
TPP countries of between three months to five years without being subject to quotas or economic needs
tests. Commitments include:

Canada providing a guaranteed work permit or work authorisation with a waiver from
labour market testing (Labour Market Impact Assessment);

Japan and Malaysia offering commitments on length of stay that are an improvement on
their commitments under our respective bilateral free trade agreements; and

Vietnam offering commitments on length of stay that are an improvement on those


under AANZFTA, which provide Australian investors and persons seeking to establish a
commercial presence in Vietnam with a greater ability to pursue opportunities,
including those opened up as a result of commitments under the TPP.

For TPP countries that have offered access for Australian investors and independent executives for a
total stay of at least one year, Australia will offer investors and independent executives of TPP countries
the ability to stay for up to two years.
Installers and servicers (after-sales, after-lease services)
Australians offering services relating to installation and servicing of machinery or equipment will benefit
from the following temporary entry commitments offered by other TPP countries:

Guaranteed lengths of stay for up to three months in Brunei Darussalam (extendable for
up to 12 months), Chile, Japan (extendable), New Zealand, Peru (renewable for one
year); and

Guaranteed lengths of stay for up to six months in Canada (with the possibility of
extensions), Malaysia and Mexico.

Commitments relevant to Australia would allow, consistent with Australias existing immigration
framework, TPP countries installers and servicers of machinery and equipment pursuant to a warranty
or contract to stay for up to three months.
Short-term business visitors
Australian business persons who wish to stay in a TPP country for a short period of time to pursue
business opportunities, including to attend a conference, trade fair or meetings, explore investment
opportunities or engage in negotiations, will benefit from greater certainty on length of stay:

For up to three months in Chile (extendable), Japan (extendable), Malaysia and


Singapore;

For up to six months in Canada (extendable), Mexico, Peru and Vietnam; and

For up to 12 months in Brunei Darussalam.

In return for TPP Parties offering access for Australian short-term business visitors, Australia is offering
commitments for business visitors and service sellers from TPP countries:

To stay for up to three months, if they are business visitors; and

40

To stay for an initial period of up to six months and up to a maximum of 12 months, if


they are service sellers.

Spouses and dependants


Recognising the importance of certainty for the spouses and dependants of a business person, some TPP
countries have offered commitments which will enable spouses and dependants of Australian intracorporate transferees, contractual service suppliers and investors to enjoy greater certainty in relation
to entry and the ability to work, including the following:

Entry and work rights in Canada, Mexico and Brunei Darussalam; and

Entry rights in Chile (with the ability to transition to a work visa without leaving Chile),
Japan, Malaysia (for intra-corporate transferees) and Peru (for intra-corporate
transferees and investors).

The periods of stay offered to a spouse and dependants are equivalent to the length of stay of the
business person.
Australia will offer entry and work rights to spouses and dependants of business persons from those TPP
countries who have extended benefits to spouses and dependents of Australian business persons.

41

XII.

Outcomes: Trade in the digital age

The TPP has state of the art commitments for trade in the digital age. The internet is an essential tool
for Australian companies doing business in the global economy and a dynamic marketplace for
Australian consumers. The TPP includes new rules about the movement and storage of data as well as
enhanced commitments to protect privacy, consumer rights and efforts to combat spam messages.
The TPP strikes the right balance to deliver outcomes for Australian business and consumers now and
into the future.
Key outcomes
Keeping information moving
For the first time in a trade agreement, TPP countries will guarantee the free flow of data across borders
for service suppliers and investors as part of their business activity. This movement of information or
data flow is relevant to all kinds of businesses - from an Australian hotel which relies on an
international online reservation system, to an Australian telecommunications company seeking to
provide data management services to businesses across a number of TPP markets. TPP countries have
retained the ability to maintain and amend regulations related to data flows, but have undertaken to do
so in a way that does not create barriers to trade.
Australias open and robust regulatory framework, including the Privacy Act and e-health record system
(Personally Controlled Electronic Health Record Act 2012), will not be affected by these TPP
commitments.
Addressing localisation barriers
TPP countries cannot force businesses to build data storage centres or use local computing facilities in
TPP markets. TPP countries have committed not to impose these kinds of localisation requirements on
computing facilities providing certainty to businesses as they look to optimise investment decisions.
Spotlight on cloud computing services
Cloud computing refers to a wide range of information-intensive services that can be delivered over
the internet. Australia is already well placed to serve the expanding Asia-Pacific market for cloud
computing services. A commitment by TPP countries not to impede companies delivering cloud
computing and data storage services provides a new platform for growth in Australian ICT services
exports. These TPP commitments will increase Australias ability to competitively deliver services into
important and expanding TPP markets including Japan, Singapore, Malaysia and Vietnam.
Software: new opportunities and greater certainty for exporters
Australian software and games will enjoy fair and equal treatment across TPP markets, providing new
opportunities for Australian exporters of all sizes. In addition, Australian software suppliers will not be
required to hand over valuable source code when seeking to import or distribute software in a TPP
country.
Preventing forced transfers of technology
Under the TPP, Australian investors will not be required to transfer technology, production processes, or
other proprietary information in order to carry on business in a TPP country.
Choosing the right technology for your business
42

Australian telecommunications businesses will benefit from an agreement among TPP countries that
where a technological requirement exists, it will need to be transparent, and it cant be used to impose
trade barriers.
No customs duties on electronic content or transmissions
TPP countries have agreed not to impose customs duties on electronically transmitted content.
Recognising the importance of cyber security
In order to make the most of the commercial opportunities in the online environment, consumers and
business require a secure and well-functioning Internet. TPP countries recognise the importance of
cooperation on cyber security through the work of national computer emergency response teams, such
as CERT Australia.
Addressing the high costs of international mobile roaming
Recognising the negative impact of high international mobile roaming charges on businesses and
consumers, TPP countries have agreed to work cooperatively to promote reasonable international
mobile roaming rates. The agreement opens the door to TPP countries to enter into arrangements with
each other on rates and conditions for wholesale international mobile roaming services.
TPP countries will promote transparent and reasonable rates for international mobile roaming services,
including by:

ensuring that information regarding roaming rates is accessible to consumers;

minimising impediments to the use of technological alternatives to roaming; and

sharing information between TPP Parties on the rates for international mobile roaming
services.

Enhancing consumer choice and consumer protection, protecting privacy and tackling spam
Consumers must have confidence their personal information will be protected in online services and
transactions. Consumers in TPP countries will benefit from commitments to protect privacy, enforceable
consumer protection, and efforts to combat spam messages.
Improving access to products and services
The internet has an impact on the choice, availability and cost of items for Australian consumers. Parties
have undertaken to exchange information and share views on consumer access to products and services
offered online among TPP parties. For Australia, this will provide an opportunity to discuss any new and
ongoing challenges faced by consumers when using the internet.
Staying ahead of future challenges
Given the ongoing rapid evolution of the e-commerce and telecommunications sectors, TPP countries
agreed on the need for future cooperation. This includes: assisting SMEs to overcome obstacles in the
use of e-commerce; sharing information and experiences on e-commerce regulations and policies; and
encouraging the private sector to develop self-regulation that fosters e-commerce.

43

XIII. Outcomes: Health


Australia has a strong reputation for its world-leading technology, innovation, research and
development, and professional skills, with significant potential to export these across the Asia-Pacific. In
an increasingly affluent South-East Asia, there is growing demand for high quality medical and aged care
services. The TPP will support the expansion of Australian health exports across the Asia-Pacific through
outcomes6 including:

The TPP will eliminate all remaining duties on medical instruments and devices and Australian
exports of medical instruments and devices to TPP Parties, which were valued at approximately
$1.1 billion in 2014.

The TPP will also eliminate all remaining duties on Australian pharmaceutical exports which
were valued at around $695 million in 2014.

Commitments from Malaysia, Mexico and Vietnam will give Australian providers of private
health and allied health services greater certainty regarding access and operating conditions in
these markets;

Disciplines on State-owned Enterprises (SOEs) will help ensure Australian manufacturers of


pharmaceutical products and medical devices can compete on a more level playing-field with
state-owned manufacturers in other TPP Parties, such as Vietnam Pharmaceutical Company.

New government procurement opportunities to provide health and welfare services in Brunei
Darussalam, Malaysia and Peru;

Commitments from all TPP Parties that will allow Australian suppliers to bid for pharmaceutical
and medical equipment government procurement contracts; and

Commitments from all TPP Parties in relation to government purchasing by the health
department or ministry, including the purchasing undertaken by 34 hospitals in Vietnam.

In addition, the TBT Annexes on Pharmaceutical Products, Medical Devices and Cosmetics will improve
the information available to importers and exporters and reduce unnecessary delays in approvals,
improving standard-setting in TPP countries for these industries. Australias total exports for these
three industries were worth over $2.2 billion in 2014. The Annexes do not impose specific requirements
or standards for any products. Australias ability to set requirements and standards, including for testing
and certification, will not be affected.
At Home
The TPP is consistent with Australias existing health laws and policies. As a result, the Pharmaceutical
Benefits Scheme will not be adversely affected and the price of medicines for Australians will not
increase.
Intellectual Property
The TPP Intellectual Property Chapter strikes a balance between promoting medical innovation and
investment, and supporting timely access to affordable medicines. It is consistent with Australias
existing health and intellectual property laws and policies, including provisions protecting patents and

Note that some outcomes specific to Vietnam remain to be formalised.

44

regulatory data associated with pharmaceutical products. It will not require any changes to the
Pharmaceutical Benefits Scheme.
For the first time in a trade agreement, there will be specific protections for biologic medicines, a
rapidly-evolving class of medicines that treat difficult to cure diseases and illnesses, such as cancer. For
Australia, the TPP reaffirms our existing standard of 5 years of protection for the regulatory data
required to be submitted to the Therapeutic Goods Administration (TGA) to demonstrate a biologic
medicines safety and efficacy. Australia will meet this standard through existing laws and regulatory
arrangements on data protection. This protection complements Australias patent system and other
processes and systems that deliver the right balance between promoting innovation and providing
timely and affordable access to medicines. Importantly, these provisions will have no impact on the PBS
or the cost of medicines for consumers.
Access to medicines in developing countries
The Intellectual Property Chapter includes specific provisions that recognise challenges facing
developing countries.
The Chapter preserves flexibilities contained in the WTO Agreement on Trade-Related Aspects of
Intellectual Property Rights (TRIPS) and the TRIPS Protocol. This includes compulsory licensing of
patents.
TPP countries also affirm their commitment to the Doha Declaration on TRIPS and Public Health, which
supports least developed and developing countries address public health problems through enhanced
access to medicines where they face insufficient or no manufacturing capacities in the pharmaceutical
sector.
Developing countries will benefit from transition mechanisms to help them implement the
pharmaceutical intellectual property obligations in the TPP. These are based on capacity and
development factors, and will provide adequate and appropriate transition periods for countries that
need them.
Annex on Transparency and Procedural Fairness for Pharmaceutical Products and Medical Devices
The TPP Healthcare Transparency Annex includes provisions on transparency and procedural fairness for
the listing of pharmaceuticals for reimbursement. These provisions are consistent with Australias
existing procedures and will not require any changes to the Pharmaceutical Benefits Scheme. The Annex
does not include commitments relating to the pricing of pharmaceuticals. The Annex is not subject to
any form of dispute settlement, including ISDS.
Investor-State Dispute Settlement (ISDS)
The TPP ISDS mechanism includes a suite of provisions protecting the Australian Governments ability to
regulate for public health and other public interest objectives.

45

XIV. Outcomes: Innovation


TPP: supporting an innovative 21st century
Australian economy
The comprehensive scope and level of ambition of the Trans-Pacific Partnership Agreement (TPP) will
promote economic growth in the Asia Pacific, further integrate Australia into the region, and create a
common platform for expanding trade into the 21st Century. For Australia this initiative also delivers a
fresh look for our trade policy - providing responses to traditional trade challenges, and at the same
time offering a framework to address contemporary commercial issues, and providing a springboard for
our innovative economy.
Encouraging Investment
The TPPs rules to protect and promote foreign investment are contemporary and robust. In embracing
these, Australia demonstrates it understands and values the role of investment flows for our economy in driving competition, productivity, and innovation. The removal of red tape hampering the entry of
private foreign investment in non-sensitive sectors will actively encourage investment into Australia
from the TPP region, particularly from financial hubs such as Singapore.
Incentivising R&D
The TPP establishes a common set of rules on intellectual property protection and enforcement for the
TPP region. Knowing that IP rights can be protected and enforced in TPP markets provides an important
incentive for Australias businesses and investors to expand their activities in the region. The TPP also
provides a catalyst for the expansion of our creative and innovative industries.
Infrastructure and Facilitation
TPP rules freeing up movement of finance, data flows and skilled professionals provide critical
infrastructure outcomes required by modern business for their success. Twinned with the removal of
regulatory barriers impeding the delivery of goods and services, and simple, efficient and common
standards for delivering goods and services across borders, the TPP provides Australian businesses with
opportunity, certainty, timeliness and transparency.
Growing Our Services Sector
The TPP will contribute to the growth and diversification of Australian exports of services by liberalizing
barriers and providing more transparent and predictable operating conditions in TPP countries.
Australian services exports to TPP countries were worth over A$20 billion in 2014. Australians involved
in education, finance, ICT, health, transport and logistics, tourism, mining and professional services
sectors all stand to benefit from this deal.
A Competitive Environment
The Australian business community will be able to make good use of TPP rules ensuring state-owned
enterprises and government designated monopolies engaged in commercial activities make purchasing
and sales decisions on the basis of commercial decisions and do not unjustifiably discriminate against
suppliers of goods and services from other TPP Parties. The TPP will help ensure Australian exporters will
be able to compete on a level playing field with state-owned enterprises and government designated
monopolies in TPP Parties.

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Environmental stewardship through trade rules


The TPP will promote high levels of environmental protection, including by liberalising trade in
environmental goods and services, and ensuring TPP Parties effectively enforce their domestic
environmental laws. TPP Parties must also take measures in relation to a number of important
environmental challenges, including protection of the ozone layer, protection of the marine
environment from ship pollution and combatting illegal wildlife trade. In relation to marine fisheries,
TPP Parties are required to seek to operate science-based fisheries management systems designed to
prevent overfishing and overcapacity, and to implement port state measures to combat illegal fishing
and deter illegal trade in fish products. In a breakthrough in the fight against subsidies that contribute
to overfishing, the TPP requires Parties to prohibit subsidies for fishing that negatively affect overfished
stocks and subsidies for vessels engaged in illegal fishing;
Labour rights
The TPP will require TPP Parties to comply with internationally-recognised labour rights, such as
elimination of forced labour, abolition of child labour, freedom of association and the right to collective
bargaining. The TPP will also enhance cooperation and consultation on labour issues, and effective
enforcement of labour laws in TPP Parties.
Anti-corruption
In a first for a trade agreement, the TPP contains provisions combatting corruption and bribery of public
officials, and other acts of corruption adversely affecting international trade and investment. These
provisions will provide greater transparency and certainty to Australian individuals and businesses
seeking to trade with, and invest in, TPP Parties.

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XV.

Outcomes: Small and medium sized enterprises

Small and medium-sized enterprises (SMEs) are key contributors to Australian employment and
economic growth, and contributors to Australian goods and services exports. In 2013-14, Australian
small businesses made up 97 per cent of all Australian businesses, produced over $343 billion (or a third)
of total economic national output, and employed 4.7 million Australians. In that period, SMEs
comprised 90 per cent of goods exporters and over 60 per cent of services exporters.
Establishing export markets abroad is a challenging task for Australian SMEs, and the Trans-Pacific
Partnership Agreement (TPP) recognises this by incorporating outcomes that will help make this task
easier in the TPP region. The TPP is the first free trade agreement that explicitly recognises the
significance of SMEs, including through:

Elimination of tariffs and reduction in non-tariff barriers in Asia-Pacific export markets;

Common and transparent trade and investment rules between 12 Asia-Pacific countries. SMEs
will save on administrative costs by being able to trade under the one set of rules, rather than
under existing multiple bilateral FTAs.

Rules that encourage SME participation in government procurement opportunities in all 12 TPP
countries, including the requirement for suppliers to have access to an independent review
body when procurement processes do not comply with the rules.

Red tape reduction when bidding for Australian Government contracts: an increase in the
threshold that government procurement opportunities need an open approach to market
together with the simplified Commonwealth Contracting Suite, which streamlines procurement
processes under $200,000 for SMEs and government.

Provisions requiring TPP Parties to establish and maintain a website containing information
about all aspects of the TPP. TPP Parties will also be required to provide links to the equivalent
websites of all other TPP Parties;

Commitments addressing a number of 21st century trade and investment issues, including rules:
against corruption; reducing unfair competition by state-owned enterprises; and ensuring a
liberalised environment for electronic commerce; and

Longer term integration benefits facilitating better access to regional supply chains for goods
and services (also known as global value chains).

With an emphasis on promoting the continued growth and development of SMEs, TPP Parties will also
cooperate:

To assist SMEs to take advantage of the TPP;

To exchange experiences on best practices to support SME exporters;

To explore opportunities for capacity building opportunities to enhance SME export counselling,
assistance and training programs; and

To facilitate the development of programs to assist SMEs to participate in, and contribute to,
global value chains.

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XVI. INTELLECTUAL PROPERTY: Frequently asked questions (FAQS)


The Trans-Pacific Partnership (TPP) Agreement establishes a common set of rules on intellectual
property protection and enforcement which aim to encourage investment in new ideas, support
creative and innovative industries, address and prevent piracy and counterfeiting, and promote the
dissemination of information, knowledge and technology.
The intellectual property provisions of the TPP affirm and build on the WTO Agreement on TradeRelated Aspects of Intellectual Property (TRIPS Agreement), covering: copyright, trade marks,
geographical indications, patents, industrial designs, confidential information, plant variety protection,
and civil, border and criminal enforcement. The TPP also includes pharmaceutical intellectual property
provisions, and covers 21st century issues such as cybersquatting of domain names, technological
protection measures, trade secrets theft, protection of satellite and cable signals and internet service
provider liability.
This document addresses a number of common questions regarding the intellectual property provisions
in the TPP.
Will Australia have to change any of its intellectual property laws?
No. The TPP Intellectual Property Chapter is consistent with Australias existing intellectual property
regime.
Will the Intellectual Property Chapter of the TPP be subject to investor-state dispute settlement?
No.
Copyright
The TPP will not require an increase in the term of copyright protection in Australia, nor the introduction
of new civil remedies or criminal penalties for copyright infringement. The TPP will not require Internet
Service Providers (ISPs) to monitor, report or penalise copyright infringement. The TPP standard is
consistent with Australias existing ISP liability regime.
Patents and regulatory data protection
The TPP outcome will not require any changes to Australias patent system or regulatory data protection
arrangements, including patent term and the length of data protection for pharmaceutical products. The
TPP will not have any impact on Australias Pharmaceutical Benefits Scheme or timely access to
affordable medicines. For more information, see: Outcomes: Biologics and Outcomes: Health.
Parallel importation
The Intellectual Property Chapter does not impose any new restrictions on Australias ability to allow for
parallel imports. The TPP leaves the issue of international exhaustion of intellectual property rights for
each TPP country to determine for itself.
Implementation timeline
On 5 October 2015, the Australian Minister for Trade and Investment and his ministerial counterparts
announced the conclusion of the Trans-Pacific Partnership Agreement (TPP) negotiations.
TPP Parties are finalising arrangements for the release of the TPP text, and it will be released well in
advance of signature.

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In accordance with Australian treaty-making processes, implementation of the TPP will include the
following steps:

The Australian Government will seek approval from the Federal Executive Council to sign the
Agreement.

Before binding treaty action is taken, the Trans-Pacific Partnership Agreement and
accompanying National Interest Analysis will be tabled in the Australian Parliament for 20 joint
sitting days.

Following tabling, the Joint Standing Committee on Treaties (JSCOT) will conduct an inquiry into
the Trans-Pacific Partnership Agreement and will report back to Parliament.

Parliament will consider any legislation or amendments to existing legislation that may be
necessary to implement the Agreement.

Other countries that negotiated the Trans-Pacific Partnership Agreement will undertake their
own domestic treaty-making processes.

The TPP will enter into force 60 days after all original signatories have notified completion of
their domestic legal procedures. If this has not occurred within two years of signature, the
Agreement will enter into force 60 days after the expiry of that two year period if at least six
original signatories accounting for 85 percent of the combined gross domestic product of the
original signatories have ratified the Agreement.

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TPP implementation timeline


In accordance with Australia treaty making processes, next steps for the Trans-Pacific Partnership
include:
Public release of the TPP text, legal review and translation
Signature of the Agreement by TPP countries
Before binding treaty action is taken in Australia, the TPP and accompanying National Interest
Analysis is tabled in Australian Parliament for 20 joint sitting days.
Joint Standing Committee on Treaties conducts an inquiry and reports to Parliament.
Parliament considers any legislative changes necessary to implement the TPP and regulations
may also need amendment
TPP countries provide notifications that they have completed their domestic treaty making
processes.
TPP enters into force 60 days after the requisite number of countires provide these
notifications.

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