In November 2021, the House of Lords International Agreements Committee published a report entitled ‘UK Accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP): Scrutiny of the Government’s Negotiating Objectives’. The House of Lords is due to debate the report on 1 February 2022.
The committee’s role is to consider and report to the House of Lords on treaties that are laid before Parliament under the terms of the Constitutional Reform and Governance Act 2010 (CRAG) and on the Government’s conduct of negotiations with international partners.
Background to CPTPP and timeline for UK accession
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a free trade agreement signed in 2018 between Australia, Canada, Japan, Mexico, New Zealand, Singapore, Brunei Darussalam, Chile, Malaysia, Peru, and Vietnam. It came into force on 30 December 2018 for the first six of these 11 countries. It has subsequently also come into force for Vietnam and Peru. The remaining countries are still completing their ratification processes.
On 1 February 2021, the UK formally requested to join CPTPP. On 2 June 2021, the CPTPP commission agreed to start negotiations with the UK. On 22 June 2021, the UK Government published its objectives for the accession negotiations. These included:
- Deepening the UK’s access to a group of countries that, the Government said, constituted one of the largest and most dynamic free trade areas in the world.
- Ensuring high standards and protections for UK consumers and workers.
- Protecting the National Health Service.
The first CPTPP working group meeting on UK accession attended by the UK took place on 28 September 2021. On 20 January 2022, the Minister for Trade Policy, Penny Mordaunt, said that the Government hoped to have negotiations concluded by the end of 2022.
The UK already has bilateral trade agreements in effect with seven CPTPP members. In addition, on 15 June 2021, the UK announced that it had reached a trade agreement with Australia. Negotiations are ongoing with New Zealand.
Economic significance of CPTPP
The International Agreements Committee’s report included a summary of the Government’s own modelling of the economic impact of accession. It said that the estimated increase in UK GDP in the long run was 0.08%. However, it reported that larger gains would be available if CPTPP membership subsequently expanded to include Thailand and South Korea. The committee agreed that membership was not expected to bring “large-scale” economic benefits in the short term. However, it stated that most of its witnesses supported the Government’s aspiration to join CPTPP, in part because membership would allow the UK to influence its future development.
Committee’s report and Government’s response
The committee said it would not address the question of whether the UK should join CPTPP, as this would depend on the agreement that the Government was able to negotiate.
Approach to negotiations and Parliamentary scrutiny
On the Government’s overall approach to the CPTPP negotiations, the committee said that the published negotiating objectives provided “some information” on what the Government is seeking to achieve, but were “very high-level” and lacked detail. It also criticised the absence of negotiating commitments and “red lines” in some areas, for example on environmental aims.
The committee called for the Government to provide regular updates to Parliament on the progress of CPTPP accession talks, including a greater level of detail on the negotiations. It also said the Government should publish the text of the CPTPP agreement, including schedules, at least three months before it is formally laid under the CRAG procedure. The committee stated this was in line with government commitments in respect of the Australia and the New Zealand trade agreements.
In response, the Government said that it was committed to transparency, but also stressed the need to protect “sensitive” negotiating positions. It said it would update parliamentary committees; if necessary, on a private basis. This could include confidentially sharing the final text of the CPTPP treaty before publication, if time allowed. In any case, the Government stated there would be “ample time” for scrutiny of the finalised agreements. It said it “anticipated” there being at least three months between publication of the agreement and its being laid in Parliament for the purposes of CRAG.
The Government also set out various ways it would engage more widely on evolving treaty discussions. These included carrying out public consultations and engaging expert advisory groups.
Ensuring UK standards are maintained
On the substance of the negotiations, the committee said its main concern was that the UK would require a number of “carve-outs” from the existing terms of CPTPP to ensure UK standards were maintained. Particular areas of concern to the committee included:
- food standards; for example, environmental standards, animal welfare and the use of pesticides;
- climate regulation;
- intellectual property; and
- protection of personal data.
The report called on the Government to set out how standards would be maintained and how it would avoid imports undercutting UK producers. The committee also stated that, as the Government seeks to strike trade deals around the world, it will need to consider how to deal with partners’ different standards and regulatory approaches. For example, the committee said that current CPTPP rules on intellectual property conflict with those of the European Patent Convention. It argued that joining CPTPP could, therefore, jeopardise the UK’s membership of the European Patent Office.
The Government’s response stated that the UK will not sign trade deals that compromise its environmental protection, animal welfare and food standards. Moreover, it said that CPTPP permits members to regulate for their own levels of protection in these areas and that, therefore, nothing in CPTPP would undermine the UK’s standards. On personal data, the Government argued CPTPP would not affect the current position, which is that individuals’ data protection rights are fully protected and upheld when their data is transferred overseas.
The committee also called on the Government to establish the new Trade and Agriculture Commission (TAC), provided for in the Trade Act 2021, as soon as possible. The commission’s role would be to scrutinise the UK’s new free trade agreements, including the CPTPP. It would assess whether agreements are consistent with UK levels of statutory protection in relation to animal and plant health, animal welfare, and the environment.
The Government’s response noted that the chair and membership of the TAC were announced on 21 October 2021. It said that the TAC would be in place in time to scrutinise the CPTPP accession agreement, once signed.
Subsequent accessions to CPTPP
The committee said the Government should consider the issue of other countries wanting to join CPTPP after the UK. For example, China applied in September 2021. The committee argued this could raise “wider geopolitical issues”. These could include the position of Taiwan, which also applied to join CPTPP in the same month. The committee said China would oppose Taiwan’s application. It called for the Government to consider such issues now, as they would affect the cost-benefit analysis of UK accession.
In its response, the Government stated that CPTPP was destined to grow. Given this, it argued the UK would benefit from joining early, by having a say in the future direction of the agreement, including its expansion. However, the Government said that it would not comment on the accession of specific countries, given that the UK is not yet a member itself.
Medicine prices and impact on NHS
The committee argued that aspects of the CPTPP intellectual property (IP) regime could imply higher medicine prices for the NHS. The Government’s response said that, while CPTPP set consistent IP standards, it would not prevent the UK seeking more ambitious bilateral agreements. The Government argued that the impact on the NHS would be a “core part” of accession negotiations and that the price the NHS pays for medicines is “not on the table”.
Devolved administrations and Northern Ireland Protocol
The committee stated the Government should consult with the devolved administrations (DAs) on CPTPP in a detailed and timely way, including producing a comprehensive impact assessment for each nation. The Government’s response noted that international trade was a matter reserved to the UK Government, but that the DAs “have been engaged at every stage” of negotiations, and will continue to be. The response set out a number of engagement processes, such as the Ministerial Forum for Trade.
The committee also called on the Government to set out how the CPTPP agreement would be impacted by the Protocol on Ireland and Northern Ireland signed with the EU. The Government’s response did not comment on this.
Bilateral agreements and the CPTPP
The committee stated that the Government should conclude all bilateral trade negotiations with individual CPTPP members before it engages in market access negotiations within CPTPP. It said this would allow the UK to use CPTPP to expand access to markets; for example, in Japan, where it argued the bilateral UK-Japan trade deal provided less good terms than the previous EU-Japan deal.
The Government’s response said that it approaches bilateral and CPTPP trade negotiations “holistically”, in order to “get the best deal for the UK”. It said that where bilateral agreements and the CPTPP coexist, UK businesses will have the choice to trade under whichever is more favourable to them.
- House of Commons Library, The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), 22 June 2021
- Institute for Government, ‘Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)’ 2 February 2021
- Hiroshi Matsuura, ‘Why joining the CPTPP is a smart move for the UK’, Chatham House, 19 March 2021
- Joanna Shelton, ‘Look sceptically at China’s CPTPP application’, Center for Strategic and International Studies, 18 November 2021
- Financial Times (£), ‘Assess Asian trade bloc candidates on their merits’, 19 December 2021
- Trades Union Congress, ‘Submission to government consultation on trans-Pacific trade deal (CPTPP)’, 16 October 2018
- Anthony Mangnall et al, ‘Looking east: the case for UK membership of CPTPP’, Centre for Policy Studies, accessed 26 January 2021
- Alexander Horne, ‘Treaty scrutiny in the House of Lords’, UK in a Changing Europe, 14 April 2021
- The House of Commons International Trade Committee is currently conducting an inquiry into UK trade negotiations for CPTPP accession.