The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), as discussed in our blog post What Does CPTPP Stand For? | CPTPP FAQ is a new free trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. 

The last Pacific Rim Trade deal went dead two years ago when the U.S. withdrew from the Trans-Pacific Partnership. All original TPP signatories, with the exception of the U.S., agreed to revive the TPP and reached an agreement in January 2018 to move towards the CPTPP.

 

What Does CPTPP Stand For? | CPTPP FAQ

The agreement specifies that its provisions enter into effect 60 days after the ratification by at least 50% of the signatories (six of the eleven countries). The sixth country to ratify the deal was Australia on October 31, 2018 and the agreement now coming into force with the initial six countries on December 30, 2018.  The six countries are Canada, Japan, Mexico, New Zealand, Singapore and Australia.  The remaining signatories; Brunei, Chili, Malaysia, and Peru will not be bound or benefit from the CPTPP until they ratify.  Vietnam recently signed on, is now a signatory and will start benefiting from the agreement after their 60 days has passed. Peru is expected to ratify before 2019. 

Canada is the first and only G7 nation with a free trade agreement with the other six. It is another way Canada hopes to diversify its trade with a longer-term goal of less reliance on the U.S. consumers for Canadian goods and services. Even without the U.S. involvement, the CPTPP represent about 13% of the world's gross domestic product. Should the U.S. reconsider and join the CPTPP the bloc would represent 40% of the GDP.

Two thirds of the provisions in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership are the same as the TPP draft.

The benefits of the free trade agreement for Canada are best explained in the Government of Canada Overview and Benefits of the CPTPP.

 

There are two sectors that are not exactly sold on the CPTPP for Canada and they include the auto manufacturers and dairy industry. The Canadian government argues the CPTPP will help Canada retain its strategic advantage for their supply chains over the increasing competitiveness of China.

 

How Canada will implement this new agreement is contained in Canada Border Services Customs Notice 18-22.

CPTPP Trade Advice

  

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About Author
Jan Brock

Jan Brock joined Pacific Customs Brokers in 2015 as a Senior Trade Advisor. She retired from Canada Border Services Agency (CBSA) in 2015 after serving more than 37 years. Jan started her career with CBSA as a summer student in 1976 and worked part-time until she graduated from U.B.C. with a Bachelor of Education Degree in 1980 . Shortly after graduating from U.B.C. Jan worked full time as an inspector with CBSA and within three years was promoted to Superintendent. She served some time in the Regional Operations office as an Operations Review Officer before she was promoted to Chief of Operations first at the Customs Mail Centre, then in the Metro District as the Commercial Chief and ending her career as a Chief at Pacific Highway Commercial Operations where she served as Chief from 1992 to 2015. During her career she was a member of the Customs Drug Team and a trainer in the National Enforcement Program. Jan also served as the Regional Coordinator Officer Powers and Use of Force for the Pacific Region. Jan served on many Commercial Program Reviews and committees both national and regional during her career and possesses an expansive knowledge of importing and exporting into and from Canada.

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While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.