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.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.