Japan’s Diet on 13 June 2018 passed a bill for ratification of a “comprehensive progressive agreement” for the Trans-Pacific Partnership trade agreement.
To complete ratification of the TPP agreement, Japan also needs to enact certain legislation that includes measures to support the domestic agricultural sector and to reinforce the protection of intellectual property rights. The TPP comprehensive progressive agreement legislation will enter into force 60 days after the date on which at least six of the signatory countries of the TPP agreement complete their ratification processes. To date, Mexico has already completed its ratification of the TPP comprehensive progressive agreement, with approval by other TPP signatories under way.
As one of the largest multilateral economic partnership agreements to be ratified, the TPP comprehensive progressive agreement will afford business in Japan the opportunity to re-evaluate their supply chains, as well as their sourcing and manufacturing processes, for increased market access and reduced customs duties. Japanese businesses could also benefit from the participation of Canada and New Zealand in the TPP (with respect to which there is currently no economic partnership agreement).
The agreement also would provide an integrated set of “rules of origin” that will apply to goods traded between the 11 member countries. Goods wholly obtained or produced in the 11 member countries thus could potentially qualify for preferential tariff treatment. This could offer businesses a range of possibilities for determining where to source and manufacture products.
The TPP also allows for self-certification by either an exporter, importer or manufacturer—thus reducing time, cost, administrative burdens, and missed opportunities compared to other agreements that require government authority certification.
For more information, contact a professional with KPMG’s Trade & Customs practice in Japan:
Masaharu Umetsuji | +81 3 6229 8070 | email@example.com
Kozu Takayuki | +81 3 6229 8205 | firstname.lastname@example.org
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