The United Kingdom's Free Trade Agreements (FTAs) with Australia and New Zealand, the first signed after leaving the European Union, entered into force yesterday. These deals are projected to significantly boost bilateral trade, increasing it by 53% with Australia and 59% with New Zealand.
Digital trade
Moreover, they open up unprecedented opportunities for UK businesses in terms of accessing these markets for services and reducing bureaucracy for digital trade. These include a ban on data localization and source code transfer requirements, while upholding high data protection standards. There are also provisions in both FTAs for the digitisation of customs processes, including the mutual recognition of respective e-contracts and e-signatures, as well as on digital identity compatibility and bilateral access to open government data. This will reduce the amount of physical paperwork and bureaucracy and make it easier for businesses to trade.
Innovation
The UK-Australia FTA Innovation Chapter promises to support innovation “by fostering opportunities in innovation-intensive industries and encouraging trade in innovative goods and services” and to provide a mechanism for the two countries to engage with each other on topics such as supply chain security, emerging technology commercialisation, regulation, and the impact of innovation on trade.
Services
There is a chapter in the UK-Australia and UK-New Zealand FTAs on professional services trade which covers a mutual recognition of professional qualifications. The chapter also includes improved market access provisions for professional services, including for UK law firms accessing Australian government procurement, financials services, and insurance firms.
Mobility
To complement this services market access, the UK-Australia and New Zealand FTAs have commitments to make business travel and visas easier for service providers, enabling people to work more freely in each country. The agreements will benefit on employees in professional services such as accountancy and law that are delivering a contract, but will also make intra-company cross-border exchanges easier. In the UK-Australia FTA, there is a commitment to a pilot program for ‘Innovation and Early Careers Skills Exchanges', aiming to help plug the digital skills shortages in each country.
Tariffs on goods
The FTAs will eliminate tariffs on all UK goods exports to Australia and New Zealand, resulting in lower prices for UK consumers. In terms of technology manufacturers in the UK, there will be lower costs for machinery parts, especially automotive parts and electrical equipment as a result of the FTAs.
Following the announcement, there is further information on these FTAs and guidance on how the Department for Business and Trade can support companies looking to expand into Australia and New Zealand which can be found online.
If members have any questions regarding the utilisation of these FTAs, and how techUK can help, then please contact Daniel.Clarke@techuk.org