Joint Standing Committee on Foreign Affairs, Defence and Trade

Committee activities (inquiries and reports)

Review of Australia-New Zealand Trade and Investment Relations

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December 2006


© Commonwealth of Australia 2006

ISBN  0-642-78883-9 (printed version)

ISBN  0-642-78884-7 (HTML version)


Membership of the Sub-Committee
Terms of reference
List of abbreviations
List of recommendations

Chapter 1 Australia–New Zealand Closer Economic Relations Trade Agreement
Chapter 2 Coordination and Setting the Agenda
Chapter 3 Telecommunications
Chapter 4 Business and investment regulation
Chapter 5 Trade, travel and tourism
Chapter 6 Mutual recognition
Chapter 7 Concluding remarks
Appendix A – Submission List
Appendix B – Exhibits List
Appendix C – List of Hearings and Witnesses
Appendix D - Trade Sub-Committee visit to New Zealand—Meetings


Australia has historically enjoyed an important and productive economic relationship with New Zealand. New Zealand is Australia’s fifth largest export market and eighth largest source of imports, and the 1983 Australia-New Zealand Closer Economic Relations (CER) Trade Agreement is Australia’s oldest free trade agreement (FTA).

The Committee’s interest in Australia’s FTAs has been demonstrated previously by its 2005 review of Australia’s FTAs with Singapore, Malaysia and the USA, and it is hoped that this report into the CER will be a valuable contribution to Australia’s economic relationship with New Zealand, and helpful in mapping future directions.

In essence, the Committee found that the relationship is strong in a plethora of areas and advancing across a broad front. However, the Committee feels that there are still several impediments to bilateral trade and investment. One of the key themes that emerged during the inquiry process was that there is a lack of central guidance and oversight of the relationship and its future directions, and this report addresses these concerns.

Since its inception the CER has undergone three reviews, though this is the first by the Joint Standing Committee on Foreign Affairs, Defence and Trade. In addition, there have been many agreements and Memoranda of Understanding signed by Australia and New Zealand concerning regulatory issues and the harmonisation of domestic policies.

Telecommunications is a substantial area of engagement between the two countries. During the inquiry process several opinions were proffered in this area, and the Committee recommends that a telecommunications Ministerial Council be established to facilitate discussion, and that it be placed on the CER Work Program.

The business and investment regulations underpinning the economic relationship are extensive and beneficial, and the long-term goal of both countries is to develop a single economic market. To this end, the Committee recommends that the issues of withholding tax alignment, and of competition policy harmonisation, be placed on the Work Program for Coordination of Business Law.

The regulatory regime covering the mutual recognition of services, products and professions, driven by the Trans Tasman Mutual Recognition Arrangement (TTMRA), is extensive and well-developed, and further contributes to the goal of establishing a single economic market.

In February 2006 Australia’s and New Zealand’s Trade Ministers agreed upon amendments to the tariff classification approach to the Rule of Origin (ROO) used in trade. These amendments will come into effect on 1 January 2007, and are supported by the Committee, as the bulk of evidence suggests that the changes will be greatly beneficial to bilateral trade.

Tourism is a major driver of bilateral trade and investment, and the two countries work very closely on immigration and border control. Australia and New Zealand have very strong travel and visa arrangements, underpinned by the 1973 Trans-Tasman Travel Arrangement which enables New Zealanders to travel to, live and work in Australia without restriction, and Australians to do the same.

In summary, Australia’s trade and investment relations with New Zealand under the CER have always been close and substantial, though it is important that attention be paid to how the relationship’s momentum can be maintained and enhanced. The CER encompasses a wide range of engagements, and indeed this report shows that it is a world class and highly respected trade agreement of great mutual benefit.

Finally, the Committee would like to extend warm thanks to the Australian Government officials who assisted the delegation with their visit to New Zealand in July 2006. The Committee would also like to acknowledge and thank the New Zealand officials and industry leaders for their hospitality and valuable contribution.

Hon B G Baird MP
Chair, Trade Sub-Committee

Membership of the Committee


Hon B G Baird MP


Deputy Chair

Hon W E Snowdon MP  


Senator A Bartlett

Senator A Eggleston


Senator A B Ferguson (ex officio)

Senator D Johnston


Senator M A Payne

Senator N Scullion


Mr P A Barresi, MP

Mrs T Draper, MP


Hon G J Edwards, MP (ex officio)

Mr B W Haase, MP


Mr M J Hatton, MP

Hon D F Jull, MP


Hon J E Moylan, MP

Hon G D Prosser, MP


Hon B C Scott, MP

Mr R C G Sercombe, MP


Dr A J Southcott, MP

Mr C P Thompson, MP


Mr B Wakelin, MP

Ms M Vamvakinou, MP


Mr K W Wilkie, MP


Committee Secretariat


Dr Margot Kerley

Inquiry Secretary

Mr Robert Little

Research Officer Mr Sam Byfield
Administrative Officers Ms Emma Martin
  Ms Leannah Auckram

Terms of Reference

The Joint Standing Committee on Foreign Affairs, Defence and Trade shall examine and report on Australia's trade and investment relations under the Australia and New Zealand Closer Economic Relations Trade Agreement (CER) with particular reference to:

Referred to the Committee by the Hon Mark Vaile MP, Minister for Trade on 1 March 2006

List of abbreviations


Australian Associated Press


AAP Telecommunications


Australian Accounting Standards Board


Australian Competition and Consumer Commission


Australasian College of Physical Scientists and Engineers in Medicine


Australian Medical Council


Australian Nursing and Midwifery Council


Australia-New Zealand Closer Economic Relations Trade Agreement


Australia and New Zealand Food Regulation Ministerial Council


Australia-New Zealand Leadership Forum


Australia-New Zealand Therapeutic Products Authority


Asia Pacific Economic Cooperation


Australia Prudential Regulatory Authority


Association of Southeast Asian Nations


Accounting Standards Review Board


Canada, Australia and New Zealand


Closer Economic Relations


Change in Tariff Classification


Department of Communications, Information Technology and the Arts


Department of Foreign Affairs and Trade


Department of Immigration and Multicultural Affairs


Engineers and Physical Scientists in Medicine


Environmental Risk Management Authority


Financial Reporting Council


Financial Reporting Standards Board


Food Regulation Standing Committee


Food Standards Australia New Zealand


Free Trade Agreement


Health Concern Non-Citizen


International Accounting Standards Board


Inter – Departmental Committee


Large Budget Screen Production Grant


National Gallery of Australia


Natural Resource Management Ministerial Council


Natural Resource Management Standing Council


New Zealand


New Zealand Australia Connections


New Zealand Commerce Commission


New Zealand Ministry of Economic Development


Organisation for Economic Cooperation and Development


Office of the Gene Technology Regulator


Primary Industries Standing Committee


Reserve Bank of New Zealand


Rules of Origin


Standing Committee on Industry and Trade


Standing Committee on Recreation and Sport


Special Category Visa


Single Economic Market


Sport and Recreation Ministers’ Council


Therapeutic Goods Administration


Trade Practices Act


Therapeutic Products Interim Ministerial Council


Trans-Tasman Accounting Standards Advisory Group


Trans-Tasman Mutual Recognition Agreement


United Nations


United Nations Commission on International Trade Law


United States of America


World Trade Organisation

List of recommendations

2 Coordination and Setting the Agenda

Recommendation 1

The Committee recommends that DFAT investigate and report to the Minister for Foreign Affairs, Minister for Trade and the Treasurer on the feasibility of setting up a CER Coordinating Secretariat/Inter Departmental Committee (IDC).

Recommendation 2

The Committee recommends that parliamentary travel, between Australia and New Zealand, on Committee work with New Zealand relevance be treated as domestic travel.

3 Telecommunications

Recommendation 3

The Committee recommends that a Telecommunications Ministerial Council be established.

Recommendation 4

The Committee recommends that telecommunication be placed on the CER Work Program at the earliest opportunity.

4 Business and investment regulation

Recommendation 5

The committee recommends that withholding tax alignment be placed on the Work Program for Coordination of Business Law at the earliest opportunity.

Recommendation 6

The committee recommends that Competition Policy Harmonisation be placed on the Work Program for Coordination of Business Law.

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