Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)
The UK has officially joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a major free trade agreement (FTA) covering trade in goods and services between key global markets. Member countries include the UK, Canada*, Australia, New Zealand, Japan, Malaysia, Singapore, Vietnam, Chile, Peru, Mexico*, and Brunei (*awaiting ratification of UK accession).
This agreement offers UK businesses new trade opportunities, even where existing bilateral FTAs are in place. Other nations, including Uruguay, Costa Rica, and Ecuador, have applied to join, while Thailand, the Philippines, and South Korea have shown interest.
Key Benefits of CPTPP for UK Businesses
The CPTPP simplifies trade between member nations, reducing tariffs and barriers to boost economic growth. Key advantages include:
- Reduced Tariffs: Most goods traded between CPTPP countries will benefit from lower or zero customs duties, enhancing cost-effectiveness for exporters and importers.
- Better Market Access: The agreement eases restrictions on services, e-commerce, and digital trade, making it easier to do business internationally.
- Stable Trade Conditions: Member countries have agreed to limit the introduction of new tariffs and progressively remove existing duties on eligible products.
- Stronger Supply Chains: The agreement fosters economic cooperation, improving efficiency in production and trade across the region.
- Support for SMEs: The CPTPP specifically encourages small and medium-sized enterprises (SMEs) to participate in international trade by reducing regulatory hurdles.
Rules of Origin: Maximising Duty-Free Trade
The CPTPP’s rules of origin define which goods qualify for preferential treatment. Goods are considered ‘originating’ if they:
- Are wholly produced in a CPTPP country, or
- Undergo substantial transformation in a CPTPP country, meeting specific product-specific rules (PSRs).
The agreement also allows for cumulation, meaning materials produced within the CPTPP region retain their preferential status when used in further manufacturing across member countries.
To maintain eligibility for duty-free trade, goods must not undergo any further processing outside CPTPP nations, apart from necessary operations such as storage or transportation under customs control.
Opportunities for UK Importers & Exporters
For UK businesses, the CPTPP presents significant advantages, especially where:
- No prior FTA existed (e.g. Malaysia), or
- The CPTPP offers better terms than existing bilateral agreements.
For companies involved in global sourcing, supply chain management, or international trade, this agreement could help reduce costs, increase market access, and enhance competitiveness.
How George Baker Shipping Can Help
We specialise in navigating complex trade agreements to help businesses maximise savings, streamline supply chains, and simplify customs procedures. Whether you’re importing, exporting, or looking to optimise your logistics under the CPTPP, we’re here to guide you.
Get in touch today to explore how your business can benefit from this trade agreement and take full advantage of the opportunities it presents.
