Trans-Pacific Partnership Moves One Step Closer to Becoming a Reality
After nearly eight years of negotiations, on October 5, 2015, the United States and 11 other countries—Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam—reached an agreement that could change the way business is conducted globally. If passed by each of the 12 countries, the agreement, known as the Trans-Pacific Partnership ("TPP"), would connect approximately 40 percent of the world's economy. In the United States, the TPP must survive what likely will be months of Congressional debate. However, as we previously reported, with trade promotion authority in place, it is more likely that the TPP will become a reality.
Although the full 30-chapter text of the TPP may not be available for another 30 days or so (it must be released at least 60 days before a Congressional vote in the United States), information relating to specific issues is starting to become available. For example, according to the Office of the United States Trade Representative, the agreement eventually would eliminate more than 18,000 tariffs on imports of goods from the United States into the 11 other participating countries. The goods covered range from automobiles and machinery to information technology, consumer goods, chemicals, and agricultural products. In addition, according to Michael Froman, the United States trade representative, the labor and environmental rules are the strongest ever in a trade agreement and a model for the future.
We will continue to monitor developments relating to the TPP. If you have specific questions regarding how your business might be affected, please contact us.