Overview and Implications for the Metals and Minerals Industry

Introduction

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a free trade agreement between 11 countries in the Asia-Pacific region. Signed in March 2018 and entered into force in December 2018, the CPTPP evolved from the original Trans-Pacific Partnership (TPP) after the United States withdrew in 2017. The agreement creates one of the world's largest free trade areas, representing nearly 13.5% of global GDP.

Participating Countries

• Australia
• Brunei
• Canada
• Chile
• Japan
• Malaysia
• Mexico
• New Zealand
• Peru
• Singapore
• Vietnam

Key Provisions

Tariff Elimination

• Eliminates or reduces tariffs on approximately 95% of goods traded between member countries
• Implementation schedule varies by country and product
• For metals and minerals: most tariffs eliminated upon entry into force or within 5-10 years

Rules of Origin

• Product-specific rules based on change in tariff classification, regional value content, or specific production processes
• Full cumulation among all 11 members
• Self-certification of origin
• Verification procedures

Trade Facilitation

• Expedited customs procedures
• Advanced rulings on classification and origin
• Electronic processing of customs documentation
• Express shipment provisions

Technical Barriers to Trade

• Enhanced transparency requirements
• Encourages harmonization of standards
• Improved regulatory cooperation
• Reduces unnecessary technical barriers

Investment

• National treatment and most-favored-nation treatment for investors
• Prohibition on performance requirements
• Investment protection standards
• Investor-state dispute settlement mechanism (with some limitations)

State-Owned Enterprises

• Competitive neutrality requirements
• Non-discriminatory treatment
• Transparency provisions
• Restrictions on non-commercial assistance

Labor and Environment

• Enforceable labor standards
• ILO Declaration commitments
• Prohibition on weakening environmental laws to attract investment
• Commitment to key multilateral environmental agreements

Implications for Metals and Minerals Industry

Market Access Opportunities

• Tariff elimination for most metals and minerals across 11 diverse economies
• Particularly significant for trade with Japan and Vietnam
• Enhanced access for processed and value-added metal products
• Simplified customs procedures for minerals and metals

Supply Chain Integration

• Cumulation provisions allow materials from any member to qualify for preferential treatment
• Opportunities for integrated production across CPTPP countries
• Enhanced regulatory coherence reduces technical barriers
• Digital trade provisions support supply chain management

Investment Protection

• Enhanced protections for mining investments
• Non-discrimination provisions
• Safeguards against indirect expropriation
• Transparency in permitting and licensing

Challenges

• Competition from lower-cost producers
• Environmental and labor compliance requirements
• Complex rules of origin for some manufactured metal products
• Remaining non-tariff barriers

Key Metals Affected

• Copper (Chile, Peru)
• Iron and steel (Japan)
• Aluminum (Australia, Canada)
• Precious metals (Peru, Australia)
• Rare earth elements (Australia, Vietnam)
• Nickel (Canada)

Implementation Status

• December 30, 2018: Entry into force for Australia, Canada, Japan, Mexico, New Zealand, Singapore
• January 14, 2019: Entry into force for Vietnam
• September 19, 2021: Entry into force for Peru
• Pending: Ratification by Brunei, Chile, Malaysia

Market-Specific Opportunities

Japan

• World's third-largest economy
• Major importer of metals and minerals
• Significant tariff reductions on specialty steel and aluminum products
• Enhanced access for copper and precious metals

Vietnam

• Rapidly growing manufacturing hub
• Increasing demand for industrial metals
• Reduced tariffs on most metal products
• Improved investment climate for mining and processing operations

Australia and Canada

• Major minerals and metals producers
• Enhanced access to Asian markets
• Investment protections for overseas operations
• Improved regulatory certainty

Mexico, Chile, and Peru

• Important mining economies
• Enhanced downstream opportunities
• Improved investment protections
• Technical cooperation provisions

Compliance Requirements

Origin Documentation

• Self-certification by exporters, producers, or importers
• Minimum data elements specified in the agreement
• Electronic certification permitted
• Record keeping requirement (minimum 5 years)

Verification Process

• Written requests for information
• Verification visits to exporter or producer premises
• Cooperation from certifier required
• Denial of benefits for non-compliance

Environmental and Labor Compliance

• Commitment to maintain and enforce environmental laws
• Recognition of sustainable development principles
• Compliance with fundamental labor rights
• Public submission mechanisms for violations

Comparison with Other Trade Agreements

Compared to RCEP

• Higher standards for labor and environmental provisions
• More comprehensive investment protections
• More extensive IPR provisions
• Deeper tariff cuts in most sectors

Compared to USMCA

• Less stringent rules of origin for automotive sector
• More extensive geographical coverage
• Different approach to investor-state dispute settlement
• Greater emphasis on regulatory coherence

Compared to EU FTAs

• Different approach to geographical indications
• Different standards for investment dispute resolution
• Similar level of environmental and labor provisions
• Different approach to technical standards

Strategic Recommendations

Short-term Actions

• Review tariff schedules for key products
• Analyze rules of origin to ensure compliance
• Implement origin certification procedures
• Train staff on CPTPP requirements

Medium-term Strategy

• Consider supply chain restructuring to maximize CPTPP benefits
• Evaluate new market opportunities
• Assess investment opportunities with enhanced protections
• Monitor implementation and enforcement patterns

Long-term Planning

• Develop integrated production strategies across CPTPP countries
• Monitor potential expansion of membership
• Participate in CPTPP committees and working groups through industry associations
• Prepare for gradual implementation of commitments

Future Developments

Potential New Members

• United Kingdom (formal application submitted)
• Thailand (expressed interest)
• South Korea (expressed interest)
• China (formal application submitted)
• Taiwan (formal application submitted)
• Philippines (considering)

Ongoing Work Programs

• Digital economy initiatives
• SME integration into global trade
• Implementation of regulatory cooperation
• Review of investor-state dispute settlement provisions

Conclusion

The CPTPP offers significant opportunities for the metals and minerals industry through expanded market access, enhanced rules for cross-border investment, and improved regulatory coherence. While compliance requirements are substantial, the agreement provides a framework for more predictable and transparent trade in the Asia-Pacific region. As additional countries potentially join the agreement, its importance as a platform for regional economic integration is likely to grow.

Additional Resources

• CPTPP Full Text: www.dfat.gov.au/cptpp
• Country-specific Tariff Schedules
• CPTPP Implementation Guidelines
• National Customs Authority Websites