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Select Committee recommends AANZFTA Bill enactment

04 June 2009

In last month’s edition of Connected Asia Pacific, we noted that the Foreign Affairs, Defence and Trade Committee of the New Zealand Parliament had reported back on the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).

The Committee has now considered the Omnibus Bill intended to incorporate the AANZFTA into New Zealand law. The two pieces of legislation requiring amendment are the Tariff Act 1988 (which will need to reflect the preferential AANZFTA tariffs and the transitional safeguards regime) and the Customs and Excise Act 1996 (which will allow the designation of certified bodies for customs and certificate of origin purposes). In practice, the Bill will be divided at the Committee of the Whole House stage before the third reading.

The Committee has recommended, by majority, to the House that it be passed without amendment. As with the original report, this report is very short (3 pages) and the Green Party has stated a minority view opposing the legislation. In addition to its previous objections, the Green Party was persuaded by a submission from Action on Smoking and Health that the AANZFTA “constrains New Zealand’s right to ban tobacco on legitimate health grounds”. This is a complex issue, which was last directly considered by a 1990 GATT decision involving Thailand. The Green Party’s conclusion does not seem to have considered developments in the WTO case law since 1990 under the GATT general exception provision (Article XX), which preserves a Member’s right to take measures “necessary to protect human, animal or plant life or health”; nor Chapter 15, Article 1(1) of AANZFTA, which incorporates GATT Article XX into AANZFTA.

As stated previously, AANZFTA will enter into force on 1 July 2009, provided Australia, New Zealand and at least four ASEAN countries have notified completion of necessary domestic procedures by that date. Otherwise, it will enter into force 60 days after the date by which such notifications have been made.



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