Like the FTA with Australia, the UK-New Zealand trade deal includes a comprehensive digital trade chapter
On 28 February, International Trade Secretary Anne-Marie Trevelyan and New Zealand Minister for Trade and Export Growth Damien O'Connor signed the UK-New Zealand free trade agreement. After the FTA with Australia, this is UK's second post -Brexit free trade agreement.
Like the FTA with Australia, the UK-New Zealand FTA goes further in digital trade than existing precedent contained in UK-Japan CEPA, and in the other roll over agreements. It includes an advanced digital chapter and one of the most comprehensive environment chapters, encouraging trade and investment in low carbon services and technology. The key digital trade policy principles techUK has been advocating for are reflected in the deal.
The agreement is not yet in force. The final deal will now be laid in Parliament for a period of scrutiny. Once it is approved, businesses will be able to trade under its terms.
You can find the full text of the agreement here.
What is in it for tech sector?
Digital and data
The UK-New Zealand FTA will ensure trusted data flows between the two countries while guaranteeing the UK's high standards of data protection. It bans data localisation requirements and requirements to transfer source code. The deal also ensures that businesses don't have to share encryption keys - critical commercial secrets for strong cybersecurity products - to enter the New Zealand market.
There are provisions on the legal recognition of electronic contracts, signatures, e-payments and digital customs declarations. The deal also includes commitments to cooperate on the development of interoperable electronic systems, including electronic invoicing, to facilitate paperless trading.
There are also provisions on regulatory cooperation in digital identities to promote compatibility, as well as provisions committing parties to open government data. In addition, both countries commit to cooperate on cyber security matters and the development of regulatory frameworks for emerging tech.
Environment
The deal includes the most comprehensive list of environmental goods with liberalised tariffs in a trade deal to date, encouraging trade and investment in low carbon goods, services and technology. It also contains a provision to cooperate on how intellectual property policy and law can support the development of environmental and clean growth technologies.
Mobility
The deal includes new commitments that allow UK service suppliers, including lawyers and auditors, to deliver contracts. It will make easier for senior managers, executives and specialists to move on intra-company transfers. They will be eligible for visas to work for a period of 3 years and family members will also be able to join.
Services
This chapter includes a Professional Services and Recognition of Professional Qualifications Annex which will support UK and New Zealand professionals who want to work in each other's territories. The commitments on recognition of professional qualifications will encourage regulators of all regulated professions to establish and operate routes to recognition. This will support UK professionals to have their qualifications recognised in New Zealand and vice versa.
Investment
The deal raises investment screening thresholds to $200 million New Zealand dollars, meaning fewer UK investments into New Zealand will be subject to review. The deal also prohibits specific performance requirements, which will lower costs for businesses, allow investors greater control, reduce barriers, and minimise market distortions. They include the prohibition of export restrictions, headquarter localisation requirements, mandatory levels of research and development, and local hiring requirements.
Telecommunications
The telecommunications chapter contains provisions that commit to ensuring service suppliers have access to public telecommunications networks on a timely, reasonable and non-discriminatory basis.
It also commits the two countries to work together on security and diversification in the telecommunications sector, including on infrastructure and technologies.
Julian David, CEO techUK, yesterday said:
The UK-New Zealand Free Trade Agreement completes a series of agreements with the Indo-Pacific region that places the UK at the forefront of countries pushing the boundaries on digital trade. Provisions on unrestricted and fair access for telecom providers, as well as on the mobility of business persons, provide opportunities and legal certainty for an industry eager to grow and expand internationally.
If members have questions about the content of this agreement and what it means for specific business models, please reach out to sabina.ciofu@techuk.org