Josh Wilson (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

On behalf of the Joint Standing Committee on Treaties, I present the committee's Report 215:AANZFTA second protocol.

Report made a parliamentary paper in accordance with standing order 39(e).

by leave—I'm pleased to make a statement on the Joint Standing Committee on Treaties' Report 215:AANZFTA second protocol. The report focuses on JSCOT's inquiries into a new major treaty action—the Second Protocol to Amend the Agreement Establishing the ASEAN-Australia-New Zealand Free Trade Area, or AANZFTA. The report also includes minor treaty actions. The first implements changes to the product-specific rules annex of the Regional Comprehensive Economic Partnership, or RCEP. The second minor treaty action is the Instrument for the Amendment of the Constitution of the International Labour Organization, 1986, and the third minor treaty action is the Amendments of 2022 to the Code of the Maritime Labour Convention 2006.

The original AANZFTA treaty which entered into force for Australia in January 2010 was signed in February 2009 between Association of Southeast Asian Nations (ASEAN) member states as well as Australia and New Zealand. This agreement is regarded as being the highest quality of ASEAN's free trade agreements with its many partners. The original agreement, of course, provided for extensive tariff reduction and greater certainty for service suppliers and investors. This update and upgrade goes considerably further.

ASEAN is Australia's second largest trading partner taken altogether and as of 2022 accounted for more than 14.8 per cent of the Australia's overall trade, valued at $178 billion annually. Needless to say, Australia's relationship with ASEAN as a group and the individual member states is critically important to our national interest.

The AANZFTA second protocol provides broader coverage through new provisions on services and investments, new digital trade data rules, and, for the first time, cooperation in the areas of environment, labour rights, and women's economic empowerment.

JSCOT undertook an inquiry into this treaty which included receiving a number submissions and holding two public hearings in March at which the Department of Foreign Affairs and Trade and a range of expert and civil society stakeholders appeared.

The key issues raised in the submissions and at the public hearings included:

On the question of ISDS, the committee has noted that, in the course of updating the AANZFTA, agreement was reached on a working-party process to consider the ISDS mechanism in that agreement. That is consistent with the Albanese government's policy of not agreeing to ISDS provisions in new trade and investments agreements—we didn't do that in the recent agreement with the UK or in the agreement with India—and at the same time seeking to review ISDS mechanisms in existing agreements.

Over several terms of parliament—and certainly in all my time in parliament, in which I've been a member of the JSCOT—the treaties committees has considered evidence which strongly suggests that ISDS mechanisms, whose purpose is to allow foreign companies to sue the Australian government, rather than to seek relief through state-to-state mechanisms, have the clear potential to interfere in a grave and costly fashion with our sovereign right and capacity to set policies in the national interest.

Of course, Australia experienced precisely that kind of awful prospect in relation to the challenge by the Philip Morris tobacco company more than a decade ago when it sought to wreck Australia's plain packaging reforms. The legal action in that matter alone cost Australian taxpayers $12 million, and it delayed the reform in this country and elsewhere.

The committee believes the updated and upgraded AANZFTA is in Australia's national interest. It builds on the original services and investment outcomes and delivers a new focus on inclusive and sustainable trade, while creating new commercial opportunities for Australians to work with New Zealand and South-East Asian partners.

The committee notes the effectively consensus support for ratification of the AANZFTA second protocol from stakeholders who engaged with the inquiry.

On that basis, the committee supports the AANZFTA second protocol and recommends that binding treaty action be taken.

The committee has also resolved that binding treaty action be taken in relation to the three minor treaty actions contained in this report, which I mentioned at the outset.

I thank the deputy chair and all committee members for their work on the inquiry and acknowledge, as always, the excellent support we receive from the committee secretariat.

On behalf of the committee, I commend this report to the House.

Phillip Thompson (Herbert, Liberal National Party, Shadow Assistant Minister for Defence) Share this | Link to this | Hansard source

I seek leave to make a short but meaningful statement on the report.

Leave granted.

I'd like to start by acknowledging the Chair of the Joint Standing Committee on Treaties, who's here today, and the fantastic secretariat for their awesome support through this whole process.

The ASEAN-Australia-New Zealand Free Trade Area agreement was signed in February 2009 and entered into force for Australia in January 2010. The original treaty provided for extensive tariff reduction and greater certainty for service suppliers and investors. It is considered ASEAN's highest-quality free trade agreement in terms of market access for goods trade. The treaty action in question in this report is the AANZFTA second protocol, which provides broader coverage through new provisions on services and investments, new digital trade data rules and, for the first time, cooperation in the areas of environment, labour rights and women's economic empowerment. This was signed in August last year.

I would like to note in particular the new chapter on micro, small and medium enterprises, providing for the promotion of information sharing and cooperation among parties to enhance opportunities for these small businesses. Small business is the engine room of our economy, and easy access to international markets in our region can only be a good thing. Our inquiry heard from the Department of Foreign Affairs and Trade:

The agreement has made a significant contribution to our collective prosperity and has provided certainty and market access to Australian businesses … ASEAN is Australia's second largest two-way trading partner bloc, behind only the European Union, with total two-way trade of $178 billion in 2022.

We did hear some concerns regarding the investor-state dispute settlement, or ISDS. DFAT told the committee that one of the positive developments from the upgrade under the second protocol was an agreement that Australia would review those ISDS provisions 18 months after entry into force. The committee agrees these should be reviewed in agreements where they already exist, and we'll be seeking an update on the progress of this review work from the department.

I thank all those involved in the hearings, and I thank the secretariat, of course, for their assistance. I commend the report to the House.