CPTPP, trade, entry into force, Japan, Trade WareIn the midst of the trade war between the United States and China there is an opening up of trade in Asia–the entry into force of the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP) on December 30, 2018, 60 days after the date of the 6th entrant’s ratification. The members who will begin receiving CPTPP benefits beginning on December 30 are the six ratifying members: Australia, Canada, Japan, Mexico, New Zealand and Singapore.  As a result of the efforts of Japan and the other members, the landmark trade deal is taking shape and influencing the global trade landscape.  As the trade war tariffs impact investment and push supply chains out of China, the CPTPP will attract trade and provide incentives for the consolidation of supply chains in the member states and the Asia Pacific region. 

When preparing for the implementation and enforcement of the CPTPP, it is important to keep in mind that while some duty savings may take place immediately on December 30, many of the commitments and tariff reductions are phased in over time periods of up to several years. Additionally, the benefits and commitments are not enforceable in Brunei, Chile, Peru, Malaysia, and Vietnam until these parties have ratified the agreement.  It is also important to keep in mind that the CPTPP suspends approximately 22 provisions from the original text of the Trans-Pacific Partnership (TPP).

There are several other countries, including Thailand, South Korea and the UK that are in the process of assessing the prospects of acceding to the CPTPP in its current state. In order to move quickly for new party accession, the CPTPP parties will be meeting in Tokyo in January, 2019 to discuss the entry of new parties to the deal.  We will continue to monitor the CPTPP developments and provide insightful and practical updates in the coming days and weeks as this agreement comes to life.

Author

Frederick Burke has over 20 years experience practicing in the area of corporate law. He served as the Practice Group Leader of the Firm’s Global WTO & International Trade Practice Group from 2006 to 2007, and has been ranked by Chambers Global as a leading lawyer in both Corporate Mergers & Acquisitions and International Trade for three successive years. Mr. Burke has also been recommended in more categories than any other lawyer in Vietnam by PLC Which Lawyer? in 2008. He is currently a member of the Prime Minister’s Advisory Council on Administrative Reform in Vietnam. Mr. Burke is highly regarded for his work on foreign investment projects in Vietnam and China for key players in the property development, trade, IT/C, and project finance areas. He provides practical advice in the related issues of securities, finance, tax, labor, regulatory compliance and dispute resolution. Mr. Burke also has extensive experience in working closely with Vietnamese legislators and law drafters on the many new laws and decrees that have been introduced to integrate Vietnam into the global economy.

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Jon joins Baker McKenzie from a large retailer where he was an Assistant General Counsel, Customs and International Trade, based in their head office in Oregon. He advised the global business on import and export laws and regulations in the areas of sanctions, customs, free trade agreements, export controls and anti-boycott. He also oversaw customs audits, investigations and litigation globally, and focused on improving supply chain efficiency and managing compliance risk. In this role, he worked extensively in the Asia Pacific region. Earlier in his career, Jon worked in trade teams in the Big Four accounting firms in the U.S. and in Baker McKenzie's Hong Kong office as an Associate between 2010 and 2012. He advised technology, apparel and consumer product companies on regional customs and international trade matters over the years.

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Kana is a corporate and commercial lawyer. Her practice is particularly focused on international agreements governing the cross border movement of products and provision of services, supply chain management as well as organizational restructuring. Kana has represented a broad range of multinational clients across various industries, such as consumer goods and retail, infrastructure, manufacturing and transportation. Kana also advises on various product safety, consumer protection and environmental compliance issues — including hazardous chemical substance import/export regulations, waste management issues and product lifecycle-related recycling — on a daily basis.

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Anne Petterd focuses on technology, telecommunications, customs and export controls, and consumer and commercial law issues. Much of her practice involves online, telecommunications and IT businesses as well as defence and government procurement. She previously worked with the Australian Government Solicitor. She also worked in Baker McKenzie's London office for 18 months and seconded to major telecommunications and information technology service providers. Anne handles projects involving digital economy, cloud computing and large-scale IT supplies in the Asia Pacific. Her work focuses on the retail, telecommunications, defence, government and financial services sectors, and often involves new business models and test regulatory issues on privacy and telecommunications. Anne also advises on customs assessment, compliance and export control requirements as well as related trade and product compliance issues. She regularly works with regulators on these matters.