United Kingdom Free Trade Agreement Legislation Bill

Members, the House is in committee on the United Kingdom Free Trade Agreement Legislation Bill. I remind members that it would be helpful for members to ask multiple questions, if they have them, of the member in charge during their call. Members, we come to Part 1.

Point of order. I seek leave for all questions to be taken as one debate.

Is there any objection? There is no objection. That shall be the case. The question is that Parts 1 to 5, Schedules 1 and 2, and clauses 1 and 2 stand part.

Thank you, Mr Chair. I’ll just take the opportunity, I guess—we’re bringing the legislation back into the House—to just outline how we have got here.

I’d just like, firstly, to thank all of those who have been engaged in progressing this United Kingdom Free Trade Agreement Legislation Bill so far, from the members of the select committee, members of Parliament, members of civil society, and business representatives. Your engagement is a critical part of the implementation process. I’d like to thank the Opposition, too, for their support.

The UK was New Zealand’s seventh-largest trading partner, pre-COVID-19, and our two countries have a uniquely close bond, including a deep connection between Māori and the UK given the role of the British Crown as one of the original signatories of Te Tiriti o Waitangi, the Treaty of Waitangi.

Concluding the free-trade agreement (FTA) has been one of the key priorities for the Government’s trade recovery strategy. In February this year, after 18 months of intensive negotiations—much of it online, I have to say—we secured one of the best deals New Zealand has ever negotiated. Our agreement will assist the development of stronger trade, economic, cultural, people-to-people links between our two countries. The expansion of New Zealand’s free-trade agreement network will contribute to New Zealand’s diversified trade portfolio and assist New Zealand’s recovery from the economic impacts of COVID-19.

Most of the obligations in the free-trade agreement are already met by New Zealand’s existing domestic legal and policy regime. A limited number of legislative and regulatory amendments are required to align New Zealand’s domestic law with certain obligations in the free-trade agreement.

The bill was introduced into the House on 26 July 2022 as an omnibus bill. The bill amends the Copyright Act 1994, the Dairy Industry Restructuring Act 2001, the Overseas Investment Act 2005, the Overseas Investment Regulations 2005, the Tariff Act 1988, and the Customs and Excise Regulations 1996. Part 5 of the bill also creates a new regime required to administer the transitional apple export quota.

I will be introducing a Supplementary Order Paper to split out Part 5 from the rest of the bill, creating two bills: the United Kingdom Free Trade Agreement Legislation Bill, and the second one will be the Apple Transitional Export Quota Bill. This split accords with Standing Order 317 given Part 5 creates a completely new legislative framework in whole, whereas other parts amend existing legislation. Part 5 will also be repealed earlier than other parts of the bill, as the apples quota will only be in force until the end of the third year that the free-trade agreement is in force.

The free-trade agreement—FTA—will also be implemented by subsequent secondary legislation. Commencement date of both pieces of legislation will be set by the Governor-General by Order in Council once the date of the entry into force of the free-trade agreement has been agreed with the UK. This, of course, is subject to the UK’s own ratification processes and we look forward to those progressing as quickly as possible.

The free-trade agreement has two obligations that New Zealand has a transitional period to implement. New Zealand has agreed to, firstly, introduce a new artist resale right scheme within two years of the free-trade agreement entering into force; and secondly, to extend copyright and related rights terms within 15 years of the free-trade agreement entering into force. This will require a further amendment to the Copyright Act 1994. Legislation for these two commitments will be required by a later date.

The Foreign Affairs, Defence and Trade Committee extensively examined the bill and received submissions from the public, civil society, and business representatives. The select committee considered the bill between 26 July and 20 October. The committee made a limited number of recommendations related to Part 5 of the bill—as I say, the apple transition export quota. Further technical amendments were also made for further clarity and consistency, and I want to thank them once again for their consideration of this.

The New Zealand - United Kingdom Free Trade Agreement sets high-quality precedents in international trade rules. It is a comprehensive free-trade agreement that has real benefits for all New Zealanders. The bill will enable New Zealand to ratify the free-trade agreement and allow our exporters to take advantage of the significant opportunities it creates.

New Zealand is aiming to complete domestic ratification processes by the end of this year. The United Kingdom is also completing its domestic ratification processes, and once both countries have done so, the FTA can enter into force.

Thank you, Madam Chair. I thank the Minister for his introduction, and we’re happy to join with the Government to deal with this as one question rather than prolonging it over five or six questions, not because this is not important—in fact, this is a very important agreement for New Zealand. It’s one of the reasons that the previous National Government, when the UK voted for the European Union, fronted up to the UK first, before any other nation. Ministers often talked to them about the relationship and the need for a free-trade agreement. We agreed to do this quickly so that we can do our part and it can take a step closer to entering into force.

The thing about trade agreements is New Zealanders only benefit from them when they can rely upon them and use them, and the faster this gets into place the better it is for New Zealand exporters. The Minister said that the UK was our seventh-largest market. Well, actually, we need only cast our minds back a short way to when it used to be our number one market. Indeed, after the war when it was possible for fresh produce, lamb particularly, to be exported as refrigerated around the world, our trade with the UK grew quite significantly, and indeed for New Zealand exports farmers depended on the UK market. Indeed, some call it the “home country” or the “old country.”

You jump forward a little way and the UK joined the then Common Market with a small number of other European countries, and overnight our access to the United Kingdom all but disappeared, and it started to create hardship in New Zealand and that great, great uncertainty. At the time we had exceptional trade from negotiators and diplomats that worked extremely hard to open the door for New Zealand produce to the European community market. I remember, many years ago when I was fortunate enough to be working in Brussels in the European Parliament, bumping into somebody—in fact, it was Lord Henry Plumb, who was president of the National Farmers Union in the UK, the equivalent of our Federated Farmers, and he brought the UK farmers into that common market. He said to me that, “You hardly saw an Australian at all around the EEC institutions but you couldn’t get in through the door without tripping over a bloody Kiwi who was there to talk about butter and sheep access.” I think that just goes to the point that New Zealand has always been good at putting its head down and working very, very hard and trying to open the doors for New Zealand exporters, because our farmers actually put their heads down and work very, very hard and are just as good.

This is important, because we lost that preferential access and the important market of the United Kingdom when they joined the European community. Some of it was restored with special quotas but it never got back to where it should have been, and now our negotiators, in the same way their predecessors have, have done an important job for New Zealand when it comes to this agreement with the UK.

I want to thank those officials. When I had the privilege of being trade Minister for a period of time in our last Government, I was one of the Ministers who went to the UK often to talk to them about why they should do a deal with New Zealand before all others, and the need for it to be extremely high quality. I remember saying—I think when it was on TV; the BBC or something like that—that it’s hard to imagine that the sheep farmers of Wales voted to leave the European Union just to be as protectionist as the EU is; surely they can stand on top of the mountains looking out from Wales and see that there’s plenty of room in the rest of the world for countries and farmers who produce high-quality goods and that when barriers are brought down everybody is better off. In this respect I know it was a difficult ask of the farmers of the United Kingdom, but with this agreement today in this House, UK farmers join New Zealand farmers in saying that protectionism hurts economies, that it takes away choice, and that they want to front along with New Zealand farmers around the world to put their best foot forward and live on their reputation of high-quality, safe food. I say to them that they have done a good thing, because there is plenty of room in the world for the things they produce and the things we produce, and together we should go out into international markets and spread that word so that others might join us.

The Minister mentioned a number of things that are in the agreement. I won’t go into them in detail, with the exception of copyright, because it is often misunderstood. I remember with the Trans-Pacific Partnership (TPP), when we were looking at copyright rules, there was great pushback from many in New Zealand who had concerns about exactly what that might mean. I think the current Minister for Trade and Export Growth, who was the Opposition spokesperson on agriculture at the time, was not one of them, but some of his colleagues went out and protested that agreement and raised, in some cases, unnecessary concerns. What is in this agreement is largely the same or extremely similar to what was in the TPP in as far as levelling the playing field for rights holders in New Zealand and giving them greater protection. The bit that I think is most important to recognise is that performers’ rights will now be in line, as far as copyright is concerned, with producers. That is an important thing because actually, often the performer doesn’t do as well as they should, nor do their family members subsequently when those rights pass on to them. I think that’s an important thing and I think we shouldn’t be afraid through our trade agreements of making sure that New Zealanders are treated well on the world stage, and equally others, in the case of UK producers, are treated well here. You can think about it in as far as song is concerned, but for movies and television, this becomes increasingly more important as New Zealand attracts investment—or hopes to—around the world for things to be produced here, and we now, as far as that production is concerned, have an advantage over others because we provide fair and reasonable protection through copyright.

This is good legislation. It does move us forward, and I would ask the Minister to pull out all stops in talking to his colleague in the United Kingdom to have them do what they need to do quickly. Wouldn’t it be good if we got to sign this actually this year before Christmas so that it entered into force rather than waiting until next year or dragging it out because it’s election year. When it comes to trade we should make a commitment to put the politics of the New Zealand Parliament and elections aside and do what’s best for New Zealand, which is to get these deals negotiated, get them done, and get them signed up and entered into force so that every single New Zealander benefits as a result of this trade agreement and the work that was started by the last National Government and finished by this Minister.

Look, thank you very much. I’ll take the opportunity to just acknowledge the Opposition’s support for this and point to two things. I would like to thank officials who worked tirelessly on this, and Brad Burgess, in particular, who was located in Ireland; he was able to get firsthand to the UK and help them sometimes. But there were a lot of officials, some of whom are behind me here, who worked tirelessly on Zoom to get this progressed. So thanks to them, once more.

On the copyright issue, it’s an interesting evolution as a nation. We’re always concerned about copyright and the fact that getting access to material from overseas—so the sooner the copyright finished, then I guess the cheaper it was to access that. We’ve now turned what is a defensive position to an offensive one, where, actually, the production of cultural material from New Zealand going out to the wider world—this will enable our artists, our authors, and those people to get longer protection and returns for that, and I think that’s a really positive thing.

Can I just finally acknowledge the UK Ministers involved, and Liz Truss, who’s been through, I guess, political turmoil—I acknowledge her enthusiasm to get this free-trade agreement done. Anne-Marie Trevelyan, who was also Minister of trade, was an enthusiastic advocate, supporter, and mover to get this through the House, and I just hope that they can support it. If the Opposition would like to see this signed this year, the Government certainly would as well, but we are dependent on the UK process.

Madam Chair, thank you, and thanks to the Minister. A question, probably: I note in the legislation, it’s not in here because it doesn’t need to be, but actually in the agreement that was reached, when it comes to the issue of geographical indicators, the GIs, there was agreement that we might do it one day in the future but that actually, in as far as the agreement is concerned, it wasn’t delivered on and it wasn’t important.

The Minister has said previously that GIs offer opportunities to New Zealand producers to gain extra value for what they produce overseas because of reputation and name; it gives them some protection. In fact, GIs are an important part, I suppose, of the EU free-trade agreement, and a lot was made of that.

I’d like to ask the Minister if he still stands by his views that geographical indicators are important for New Zealand producers, give protection, and can drive greater value for New Zealand producers of wine and beef and many things, and if that’s the case, why that isn’t in this agreement and yet it is in the EU agreement?

Look, thank you very much. They are really important, and obviously more important in the EU than in the UK, but none the less, we still had issues like scotch and we’ve got other acknowledgments that we’ve got to work through on geographical indicators (GIs) with reference to the conclusion of the EU trade agreement.

It will be more important and more valuable for New Zealand as we move forward to establish provenance, such as we have with Marlborough sauvignon blanc and Central Otago Pinot noir. So we’re starting to develop those GIs, and we will continue to work through the process of, I guess, marketing those to greater value and, hopefully, over time, over the next century, they’ll be as valuable as the EU claim for their own ones.

On that, to the Minister—and noting his suggested difference between this agreement and the EU one, whereas it’s more important to the EU than us, and I suppose therefore less important to the UK—are there any industries or sectors or products that he thinks geographical indications (GIs) wouldn’t be helpful for? And will they be excluded for any decision under this agreement or in GIs for the future, or does he think GIs across the board in agricultural products and food production add value to New Zealand producers?

Thank you, Madam Chair. I’m also providing an opportunity for the Minister just to seek some guidance in regards to the last question. The question I have is in regards to Part 5, clause 34, and particularly around the obligations relating to fresh apples. And you may think, “Well, that’s an interesting area to get into”, but I grew up on an apple orchard, actually; so there’s the context for the question a little bit. But the point really is in regards to clause 34(2)(a)(i), which is in regards to the three-year period. I’m looking for a little bit of context from the Minister, just in terms of their landing on that period of time, and any consideration in regards to alternative periods of time that may have been appropriate, and the impacts on that industry.

Thank you very much. In terms of apples, what we decided here is that the industry would manage its own transition. The arrangement and the negotiation that we have is very, very good. There is a three-year transition arrangement. So we’re bringing in a separate piece of legislation here to ensure that that can happen and be managed by the industry. That’s why we’re doing that.

In terms of the geographical indicators (GIs), as I say, I referenced a couple that we have had to acknowledge in scotch. And, in terms of reference to the EU, they’re no more important other than the EU has been very protective of them—and from a position of 2,000 down to about two or three, which we now have to honour. The situation is not quite the same in the UK. They don’t have as many GIs. They have some—we have to acknowledge those—and this trade agreement will allow us, both sides of the agreement, to pick up value from them.

I move Supplementary Order Paper 277 dividing the bill.

The question is that the motion be agreed to.

Motion agreed to.

Bill to be reported without amendment and divided into the United Kingdom Free Trade Agreement Legislation Bill and the Apple Transitional Export Quota.

House resumed.

Madam Speaker, the committee has considered the United Kingdom Free Trade Agreement Legislation Bill and reports it without amendment, and divided into the following bills: United Kingdom Free Trade Agreement Legislation Bill and Apple Transitional Export Quota Bill. I move, That the report be adopted.

Motion agreed to.

Report adopted.