WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO  WT/TPR/M/216/Add.1 
28 July 2009 
 (09-3670) 
Trade Policy Review Body 
10 and 12 June 2009 Original: English/ 
 anglais/  inglés 
 
 
TRADE POLICY REVIEW 
NEW ZEALAND 
Record of Meeting
 
Addendum  
Chairperson:  H.E. Mr. István Major (Hungary) 
 
 This document contains the advance written questions, and replies provided by New Zealand.1 
__________________________________________________________________________________ 
Organe d'examen des politiques commerciales 
10 et 12 juin 2009  
EXAMEN DES POLITIQUES COMMERCIALES 
NOUVELLE-ZÉLANDE 
Compte rendu de la réunion
 
Addendum  
Président:  H.E. M. István Major (Hongrie) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par la Nouvelle-Zélande.1 
__________________________________________________________________________________ 
Órgano de Examen de las Políticas Comerciales 
10 y 12 de junio de 2009 
 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
NUEVA ZELANDIA 
Acta de la reunión  
Addendum  
Presidente:  Excmo. Sr. István Major  (Hungría) 
 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por la Nueva Zelandia.1 
                                                      
1 In English only./En anglais seulement./En inglés solamente.  WT/TPR/M/216/Add.1 
 Page 3 
 
 
  REPLIES PROVIDED BY NEW ZEALAND (FIRST SESSION) 
 
BRAZIL  
 
Q1 The Government Report affirms that the Ag reement establishing the ASEAN-Australia-New 
Zealand Free Trade Area (AANZFTA) will include as  benefit for New Zealand exporters "the phased 
elimination of trade barriers, greater certainty  and transparency, and reductions in associated 
transaction costs".  Will the mentioned eliminat ion of trade barriers encompass trade defence 
measures such as anti-dumping and countervailing duties as well as safeguards"?  If so, please explain how their application within the AANZFTA will be phased out. 
 
Answer:
 
There is no phased elimination of trade defence measures such as anti-du mping, countervailing and 
safeguards under the agreement.  Each Party to  the agreement therefore retains its rights and 
obligations under the relevant WTO trade remed y agreements.  The agreement does include a 
transitional safeguard mechanism wh ich can be used in certain circumstances over a transition 
period which, for each particular good, is the p eriod from entry into force of the agreement until 
3 years after the customs duty on that good is to be eliminated or reduced to its final commitment. 
 
 
CHINA  
 Q1 Would the Delegation of New Zealand please share its views on New Zealand's economic 
prospect in the background of global financial crisis ?  What are the effects of these measures taken by 
the previous Government and new Government on New Zealand's economy?  Would New Zealand 
take further steps to counter the effect s of the current crisis in the future?  
 Answer:
 
In the 2009 Budget (released 28 May) the New Zealand economy is forecast to contract by 0.9% in the year to March 2009 and by 1.7% in the followi ng March year.  In the year to March 2011 growth 
is expected to return to 1.8% as the world economy recovers and as the economy responds to 
monetary and fiscal stimulus. 
 
New Zealand has responded to the global economic crisis with both monetary and fiscal policy.  
New Zealand was in a relatively strong position to respond as there was considerable scope to loosen 
monetary policy and the Government's gross debt  was less than 20% of GDP at 30 June 2008, 
following more than a decade of fiscal surpluses. 
 
In the 2009 Budget, the Government announced a numb er of measures to curb expenditure growth 
and control net debt.  The Government has reduced  its allowance for new operating spending to a 
maximum of $1.1 billion in 2010/11, increasing by 2% per annum, down from $1.75 billion previously.  With these changes, gross government de bt is projected to peak at 43% of GDP in 
2016/17 and to decline after that as the Government's accounts return to surplus.   
 
The New Zealand Government has $5.8 billion of ne w spending planned over the next five years to 
help maintain economic activity and to support jobs.  Over the next year, the focus will be on 
rebuilding business confidence and ensuring that yo ung people remain connected with the workforce 
and improve their skills.  In the medium term, however,  the focus is on reducing debt.  This is viewed 
as essential if the Government is to maintain public service s and preserve family assistance, 
superannuation and welfare entitlements at their current levels.    
Q2 Would the Delegation of New Zealand please clar ify whether the Grants or the help by the 
NZTE are available to both domestic and foreign companies? WT/TPR/M/216/Add.1 
Page 4  
 
  Answer:
 
We can confirm that grants are available to foreign companies, as long as the company or one of its 
subsidiaries has a presence in New Zealand and m eets other standard grant requirements that apply 
equally to domestic companies.  
Q3 Would the Delegation of New Zealand please elaborate how the NZTE helps to promote and 
increase business and exports in the three targeted sectors, for example the creative industries? 
 
Answer:
 
NZTE uses its onshore and offshore networks to pr ovide advice and expertise to firms working in 
those sectors.  NZTE also works to provide ma rketing and networking opportunities for its clients 
through sponsoring trade shows, conferences, and in trade delegation visits.  Specific information 
regarding NZTE's activities can be found at: http://www.nzte.govt.nz/About-NZTE/Docume nts/NZTE-Annual-Report-complete-2008.pdf.  
 Q4 Would the Delegation of New Zealand please explain the specific policies concerning the 
finance and tax concessions under the Film Co-pr oduction Agreement or Arrangements, which have 
been indicated in New Zealand’s MFN exemptions for audio-visual services? 
 
Answer:
 
A key provision of Film Co-production Agreements or Arrangements is that co-production films – 
defined widely to include, inter alia, videos, documen taries, mini-series or television dramas - will be 
considered to be national films entitled to all the bene fits provided to such films by the legislation of 
each country.  In New Zealand the main benefit accru ing to national films is qualification to apply for 
financial assistance pursuant to section 18 of the New Zealand Film Commission Act 1978.  Partner countries will likewise make any film subsidies, tax breaks, or other financia l incentives open to a 
co-production film.  
 
Q5 Would the Delegation of New Zealand please explain the main methods and relevant 
programs through which the New Zealand Touris m Board and its operational entity, Tourism 
New Zealand promote New Zealand internationally? 
 
Answer:
 
Tourism New Zealand (TNZ) is the trading nam e for the New Zealand Tourism Board (a Crown 
Entity).  Its role is to market New Zealand as a vi sitor destination overseas.  TNZ has nine overseas 
offices, including an office in Sh anghai, which opened in 2000. 
 
TNZ promotes New Zealand worldwide using a number of different methods.  These include 
marketing and promotional work, such as advertising and public relations activity.  It works with the 
local travel trade, who sell New Zealand holidays, to develop better tourism products and to provide 
them with more information about New Zealand.  It also works with local media and celebrities, 
encouraging them to visit New Zealand and then to  write or broadcast stories about their experience. 
 
TNZ also provides information to tourists thin king of visiting New Zeal and through its website 
www.newzealand.com.   
Q6 Would the Delegation of New Zealand please sp ecify the main international standards which 
have been applied in New Zealand's private services sector? 
 
Answer:
 
The reference to "international standards" in the Report was intended to highlight the liberal nature 
of New Zealand's services market compared to the extent of liberalization in markets in other 
countries.  It did not mean that we apply in ternational standards to foreign services suppliers.  WT/TPR/M/216/Add.1 
 Page 5 
 
 
   
 
TURKEY  
 
Q1 Could New Zealand elaborate on the reasons  behind the low labour and capital productivity? 
 
Answer:  
The answers regarding labour and capital pr oductivity are best taken separately.  
 Labour productivity 
 
It is important to distinguish between the level  of labour productivity and its rate of growth.  
New Zealand has a relatively low level of labour productivity (measured by GDP per hour worked); 
according to the OECD, New Zealand's labour productivity level in 2007 was 22
nd among OECD 
countries and was over 40% below U.S. labour pr oductivity and around 30% below Australian labour 
productivity.    
 
Estimates of New Zealand's labour productivity gr owth vary depending on whether GDP per hour is 
used (e.g. as by the OECD) or more narrow, but mo re accurate figures based on the "measured" part 
of the economy are used.  New Zealand's GDP per hour worked grew at an annual average rate of 
1.1% between 1995 and 2006 compared to the OECD average of 1.9%.  However, its labour 
productivity for the "measured" part of the economy grew over the same period at an annual average 
rate of 1.9%. 
 
The reasons for New Zealand's low level and modera tely low growth rate of labour productivity 
include: 
 
- New Zealand's geographical c haracteristics of distant location from markets and 
small size.  These make trade more costly , reduce the intensity of competition and 
reduce flows of investment and knowledge.  The OECD has estimated that distance 
from markets reduces New Zealand's GDP per capita by around 10% and explains 
around three quarters of its gap compared to the OECD average. 
- The strong rise in labour utilisation by about 1% per year from 2001 to 2006 could 
have depressed average annual labour produc tivity growth by as much as 0.4 
percentage points over this period (OECD Economic Survey of New Zealand, 2009).  While growth in labour utilisation is a good thing (and raises GDP per capita) it needs to be recognised that many of the new entrants to employment have below-
average skills and hence exert a downwar d influence on the growth of labour 
productivity. 
- New Zealand has low capital intensity (capital per hour worked) and this explains 
some of its low level of labour productiv ity.  Low capital intensity reflects lower 
investment over time.  New Zealand's lower investment levels in turn probably reflect 
a combination of a high cost of capital and an insufficient number of attractive 
business investment opportunities. 
- However, as the OECD noted in its 2009 survey of New Zealand, more recently from 
2001 to 2006 the country has had one of the largest contributions to labour productivity growth from capital deepening compared to other OECD countries.  
Rather, what stands out is a low contribu tion from MFP growth compared to other 
countries.  It must be remembered however that capital intensity and MFP interact 
with each other in various complex ways. 
- Possible causes of low MFP growth are lo w levels of business innovation, some less-
than-optimal regulatory settings, skill short ages, and skill losses to Australia and 
other countries. WT/TPR/M/216/Add.1 
Page 6  
 
  - It is also likely that a deficit in invest ment in some areas of transport, energy and 
communications infrastructure has held back labour productivity growth in New 
Zealand. 
 
Capital productivity 
 
Capital productivity is output per unit of capital,  and like labour productivity it is a partial measure. 
However, in general we a re more interested in investing in cap ital to raise the productivity of each 
person working rather than adding more people to ra ise the productivity of each machine or other 
piece of capital.  Put another way, a high figure for capital productivity can re flect efficient use of 
capital or low investment.  This ambiguity makes capital productivity a less useful partial measure 
than labour productivity.  For this  reason we think that little shoul d be read into New Zealand's 
figures on capital productivity.  And they do not stand out as low compared to other countries. 
 
Q2 On the productivity issue, the Secretariat's re port mentions at para 11, page 7 (Fiscal Policy) 
the increased spending focused on improving pr oductivity capacity by addressing infrastructure 
bottlenecks, could New Zealand give details on this spending program? 
 
Answer:  
In December, the Government increa sed the capital allowance for Budget 2009 from the $900 million 
set by the previous government, to $1.45 billion.  The capital allowance for Budgets 2010 to 2012 will 
also be $1.45 billion, and from B udget 2013 will increase to $1.65 billion. 
 
The 2009 Budget provides funding for the following major projects:  
 
- $245 million for health capital spending – this provides funding to enable the 
consideration of a number of capital p ressures and opportunities that have been 
identified including Auckland regional demogr aphic growth, hospital upgrades, and 
dedicated elective theatres; 
- $250 million capital funding for telecommuni cations infrastructure – this includes 
$200 million as the Government's first contribution toward a new ultra-fast broadband network, $34 million to support schools to be broadband ready (which 
was previously announced as part of the Infras tructure Stimulus pa ckage earlier this 
year), and $16 million for the continuation of the Kiwi Advanced Research and Education Network (or KAREN), our high sp eed network for the tertiary education 
and research sectors that allows our research ers to conduct research to international 
standards; 
- $170 million capital funding consisting of $146 million to increase prison capacity 
and another $24 million to plan for further additional capacity, to ensure that there is a sufficient number of prison beds to meet demand in the North Island, in particular; 
- $325.6 million capital funding for the 21st Century School Building Programme, 
which will fund new schools and provide for the upgrading and maintenance of 
existing schools.  Of this $172 million has b een previously announced as part of the 
fiscal stimulus package.  In addition the Government will provide an additional 
$197.7m of operating funding over the n ext four years for operating expenses in 
school property (largely depreciation);  and 
- $90 million of operating subsidy for KiwiRail. 
 
Except where noted the expenditure in Budget 2009 is additional to the infrastructure spending 
included in the government’s fiscal stimulus package  announced earlier this year.  The Government's 
infrastructure programme of initi atives has to date included: 
 
- Fiscal stimulus expenditure announced in February 2009 comprising: 
- Housing $124 million  WT/TPR/M/216/Add.1 
 Page 7 
 
 
  - Education $28 million in th e current year and a further $172 million which is 
being funded as part of Budget 2009. 
- Transport $142 million to bring forwar d five large projects and a number of 
small roading projects. 
- $258 million for funding of metro rail and rolling stock in Wellington. 
- A new loan facility for KiwiRail of $140 million of which $75 million has been 
provided for the purchase of new locomotives.  This funding is in addition to funding 
already announced for rail network impro vements totalling $138 million over three 
years (2008/09-2010/11). 
 
The Government has also announced that it will increase funding for State Highways by $961 million 
over the next 3 years.  This expenditure is supporte d through a mixture of reallocation of funding 
from other transport projects and increasing user charges (Announced in March 2009).  
 Q3 Could New Zealand kindly explain the reasons behind the fluctuations in the inward FDI in 
the period between 2003-2008?  
Answer:
 
Foreign direct investment in New Zealand in the year ended March 2007 of $12.5 billion was 
significantly higher than in the March 2006 year ($2.4 billion) and the March 2008 year 
($4.2 billion).  It is not unusual for FDI into New Zealand to fluctuate from year to year.  New Zealand is a relatively small economy and the ac quisition of large value New Zealand entities by 
non-resident direct investors can have a significant impact on the statistics.  The main features of the relatively large ne t inflow of FDI in the March 2007 year were: 
 
 1. Significant merger and acquisition activity . A number of large and relatively small 
value New Zealand entities were acquire d by non-resident direct investors; 
 2. During the year a number of foreign direct  investors injected additional capital into 
their New Zealand subsidiaries; and 
 3. Retained earnings continued to c ontribute to the overall inflow of FDI. 
 
Q4 Concerning the ANZCERTA, the Secretariat's report mentions that "as MFN tariffs in both 
countries are relatively low and have declined st eadily, preferential access has continued to be 
eroded". 
 
Is there any plan or thought to address the preferen ce erosion issue with regard to the ANZCERTA?  
 
Answer:
 
While ANZCERTA has established between New Ze aland and Australia one of the most liberal 
trading relationships that exists between any two countries, it was from the outset of the agreement 
always envisaged that both countries would contin ue to liberalise trade unilaterally, multilaterally 
through the WTO, and through Free Trade Agreements w ith other trade partners.  Preference erosion 
has, accordingly, never been an issue of concern.  In keeping with this New Zealand (and Australia) 
continue to improve the bilateral trading environment through ongoing work toward the 
establishment of a Single Economic Market (SEM), to  pursue systemic improvements in free trade 
through the WTO and to seek improved trading relati ons with other trade partners through free trade 
agreements.  
Q5 Could New Zealand kindly elaborate on the imp act of the free trade agreement with China on 
its bilateral trade and its trade creating effect?  WT/TPR/M/216/Add.1 
Page 8  
 
  Answer:
 
The China-New Zealand FTA liberalises bilateral trade  in goods and services, as well as facilitating 
investment and the movement of natural persons invo lved in business between the two economies.  
 Goods trade is liberalised through reduced tariff rat es.  96% of the tariffs applied to New Zealand's 
exports to China will be progressively eliminated w ith final reductions made in 2019, and 100% of 
tariffs on China's exports to New Zealand will be pr ogressively eliminated with all exports becoming 
duty-free by 2016.   Though it is still early days in terms of the FTA, wh ich entered into force on 1 October 2008, bilateral 
trade appears to be holding up in the difficult econom ic times, and even increasing.  In the year to 
April 2009, total trade between NZ and China in creased by 24.67% compared with the year to 
April 2008.  Exports to China increased 52.12% in the period, while imports increased 14.99%.  The 
figures are as follows:    
 Year to April 2008  
(NZ$ millions) Year to April 2009  
(NZ$ millions) % change 
Exports to China 2,033.96 3,094.07 52.12 
Imports from China 5,769.28 6,634.20 14.99 
Total trade 7,803.24 9,728.27 24.67 
 
Q6 What is the current status of the negotiations  for the free trade agreements to be concluded 
with India, Korea, Japan?  
Answer:
 
New Zealand Trade Minister Tim Groser and India's then-Commerce and Industry Minister Kamal 
Nath announced in February this year that, subject to the approval  processes of both governments, 
FTA negotiations would commence as soon as possi ble.  The New Zealand Cabinet has now agreed 
(30 March 2009) to enter into FTA negotiations with India, subject to India’s own approval processes.  If the Indian Cabinet also appro ves entry into negotiations, it is hoped that these 
will commence sometime in the latter half of this year. 
 
New Zealand and Korea will hold a first round of  talks in Seoul from 8-12 June 2009. 
New Zealand's long term objective remains to conclu de a bilateral FTA with Japan.  A joint Officials 
Group has been established to examine policy op tions to enhance the Japan-New Zealand trade and 
economic relationship.  It is New Zealand's expectat ion that the Officials Group process will provide 
both governments with the informa tion they need to decide wheth er to move to EPA negotiations in 
the future. 
 
Q7 The Secretariat's Report states that "the au thorities are developing plans for the progressive 
implementation of the single procurement polic y across the state sector…"  Could New Zealand 
explain the recent developments concerning these pl ans and progressive implementation of the single 
procurement policy? 
 
Answer:
 
There have been no recent developments with regard to  the single procurement policy across the state 
sector since the change of government at the end of 2008. 
 Q8 Could New Zealand provide some informati on on the reasons behind the policy reversal in 
1999 with regard to the privatization as mentioned at the Secretariat's Report?   WT/TPR/M/216/Add.1 
 Page 9 
 
 
  Answer:  
In 1999 a Labour Government was elected.  Changes of policy in relation to privatisation likely 
reflect the differing approach of the new Government. 
 
Q9 What is New Zealand's experience with rega rd to performance of the enterprises bought back 
since their re-acquisition by the Government? 
 
Answer:  
The Crown has owned KiwiRail (that is, the rail operator business, rather than the track infrastructure) for less than a year now, so it is too soon to make statements about its performance 
under Crown ownership.  Having said that, Ki wiRail's revenues have suffered because of the 
economic downturn, due mainly to lower volu mes in bulk commodities and the import-export 
container business.  Air NZ was recapitalised by the Crown in 2001 and today the Crown retains a 75% ownership – the 
remainder being owned by the private sector and listed on the NZ and Australian exchanges.  The 
best indicator of Air NZ's financial performance is  the listed share price.  The following share price 
graph is taken from Air NZ's website. 
 
 
 
 
The performance of the company has suffered over th e last two years because of the global economic 
downturn and periods of excessively high fuel pr ices.  However, many investment analysts remain 
positive about the company and its ability to withstand the global economic headwinds. 
 
Q10 What is New Zealand's policy towards the ACTA negotiations?  
Answer:
 
New Zealand is participating in the development of ACTA because it shares other participants' 
interests in addressing the growing global problem  of trade in counterfeit goods and pirated 
copyright works. 
 
Q11 What is New Zealand's approach towards possi ble inclusion of patents into a possible ACTA? 
 Answer:
 
At this point in time, ACTA participants are still discussing various proposals for different elements 
that may ultimately be included in the agreement, including in relation to scope.  While negotiations 
are ongoing, New Zealand is not prepared to disclose its approach on specific issues. 
 WT/TPR/M/216/Add.1 
Page 10  
 
  Q12 The Secretariat's report states that during the period under review, "all statutory marketing 
boards have been disestablished and, their particip ation in commercial aspects such as marketing and 
export rights have been deregulated".   Could New Zealand kindly clarify this statement on:  
 
- whether these marketing boards no longer exist (as stated at the page 76, para. 16), if 
not; 
- what current responsibilities do they have?  
 Answer:
 
The statement is correct;  New Zealand no long er has statutory marketing boards.  Previously, 
entities such as the Hop Marketing Board and ENZA (for pipfruit) were involved in commercial 
aspects such as marketing and export of products.  However, since the last Trade Policy Review, all 
such powers have been removed.  Some other boards, such as the New Zealand Meat Board and the 
then New Zealand Wool Board stopped their expor t marketing activities in the early 1990s.  While 
statutory marketing boards no longer exist in New Zealand, note that one entity, ZESPRI, has almost exclusive rights, under Kiwifruit Export Regulations 1999, for exports of kiwifruit to markets other 
than to Australia.  
Q13 Does the word "deregulated" implies that thei r sole right over trade of certain products was 
removed, but they may still be involved in trade along with other private enterprises? 
 
Answer:
 
No, the word "deregulate" refers to the fact t hat their statutory powers to engage in commercial 
activities like export marketing have been removed entirely.  The Government has disestablished the 
former statutory bodies of these industries, and the industries have established new entities under 
New Zealand corporate law to engage only in  industry-good activities like funding and managing 
research and development.  Note that, in the case of ZESPRI the deregulation is partial and ZESPRI 
continues to trade as a cooperative company. 
 
Q14 Could New Zealand kindly provide a list of industry good boards? 
 
Answer:  
New Zealand provides a list of industry good bodies below: 
Foundation for Arable Research  
New Zealand Asparagus Council  
New Zealand Avocado Growers Association  Blackcurrants NZ Limited  
Egg Producers Federation of New Zealand  
New Zealand Feijoa Growers Association  Meat and Wool New Zealand Limited  DairyNZ  New Zealand Nash Asian Pear Growers Association  
New Zealand Citrus Growers Incorpor ated – Navel Orange Product Group  
Federated Farmers of New Zealand – Herbage Seed Subsection  The NZ Passionfruit Growers Association  Pipfruit New Zealand  New Zealand Citrus Growers Incorporat ed – Satsuma Mandarin Product Group  
Summerfruit New Zealand  
New Zealand Tamarillo Growers Association  
Horticulture New Zealand   WT/TPR/M/216/Add.1 
 Page 11 
 
 
  United Wheatgrowers Limited  
New Zealand Grape Growers Council  Wine Institute of New Zealand  Fruit Wine & Cider Makers Association of New Zealand  New Zealand Pork Industry Board [a statutory entity]  
Deer Industry New Zealand [a statutory entity]  
 
 
MEXICO
 
 
We would be grateful if New Zealand could repl y to the following questions which pertain to 
document WT/TPR/S/216 of 6 May 2009. 
 
Q1 Paragraph 41 states that New Zealand has Article II (MFN) exemptions for audiovisual 
services (Film Co-Production Agreements).  Does it in tend to eliminate these exemptions in the near 
future?  Answer:
 
At this stage, the New Zealand Government is not actively considering the removal of the MFN exemption for audiovisual services (Film Co-Production Agreements).   
 
Q2 According to paragraph 50, other recent m easures include changes in prudential regulations 
regarding liquidity and liquidity risk, and a cha nge in outsourcing policy which requires banks to 
ensure that they would be capable of providing core banking functions, such as settlements, if any 
service provider they employ were to fail.  These measures are expected to be implemented over the 
next few years.  Is there any planned date  for implementing them in the near future? 
 
Answer:
 
The outsourcing policy has already been implemente d by the Reserve Bank.  Banks are now working 
towards compliance with the policy.  The policy can be found at:  http://www.rbnz.govt.nz/finstab/ banking/regula tion/bs11.pdf. 
 The liquidity policy of the Reserve bank is currently being prepared for implementation.  The final 
policy will be available on the Bank's website www.r bnz.govt.nz shortly.  It will be part of the BS 
series and will be numbered BS 13.  The current co nsultation paper on the policy can be found at:  
http://www.rbnz.govt. nz/finstab/banking/. 
 
Q3 Paragraph 59 points out that the Telecommuni cations Amendment Act, which took effect on 
22 December 2006, is administered by the Commerc e Commission, and that the telecommunications 
legislative framework was changed considerably unde r the amendment.  What were the main changes 
in the telecommunications legislative framework, pa rticularly as regards the participation of foreign 
service providers.  
Answer:
 
There are no restrictions on the participation of  foreign service providers in the New Zealand 
telecommunications market (the market was fully ope ned to competition on 1 April 1989).  As such, it 
was not necessary to make any changes to the legi slative framework in this regard through the 
introduction of the Telecommuni cations Amendment Act (2006). 
 WT/TPR/M/216/Add.1 
Page 12  
 
  Key features of the Amendment Act include: 
- A requirement for the responsible Minister to settle a robust operational separation 
plan with Telecom that requires the busin ess operation to be separated to support 
transparency, non-discrimination, and equivalence of supply of particular services;  
- Requirements for local loop unbundling,  subloop unbundling, and unrestricted 
bitstream unbundling;  and  
- A range of supporting measures to enhance th e effectiveness of the Act, such as 
information disclosure through accounting separation, enforcement provisions, 
market monitoring and information dissemination.  
 
The Amendment Act also extended the Telecomm unications Commissioner's powers and functions to 
initiate regulated services determinations, monitor and provide public information on 
telecommunications service market performance such as pricing relative to other OECD countries, 
enforce Telecom's Separation Undertakings, set up an accounting disclosure regime; and also 
strengthened the enforcement provisions. 
 
To ensure that access terms and conditions are set in a timely and effective manner, the Amendment 
Act introduced a standard terms determination (S TD) process.  This enables the Commission to make 
a determination on how a designated (price and no n-price regulated) or specified (non-price only 
regulated) service must be supplied with reference to all access seekers and providers of the service.  
 
The Amendment Act also provides for a formal und ertakings process that allows the Commission to 
accept and enforce voluntary supply commitments from access providers in lieu of regulation. 
 Under the Amendment Act, the Commission must ha ve regard to economic policies of the government 
that are transmitted in writing to the Commission by the Minister.  
 
Further information on the regulation of the New Ze aland telecommunications sector is available at 
the following website:  http://www.med.govt.nz/templates/ StandardSummary____38607.aspx.  
 Q4 According to paragraph 67, negotiations are also  underway to remove restrictions in other air 
services arrangements, including those with South Africa, Canada, and the European Communities.  
New Zealand is also seeking to open negotiations with Japan, and negotiations are taking place with a 
view to establishing ASAs with Peru and Turkey.  Do  you plan to negotiate the removal of restrictions 
in air services arrangements with c ountries other than those mentioned? 
 
Answer:
 
Progress has been made on a number of the relati onships listed in paragraph 67 (for example, 
negotiations with South Africa, Canada and Turkey  have since been successfully concluded, and 
negotiations with Peru are largely complete).  Wi th air services relationships in place with all of 
New Zealand's major and medium-sized air services  markets, in the current economic climate and 
with other demands on its negotiating resources, apar t from those listed in paragraph 67 New Zealand 
is not actively seeking to establish additional or remove  restrictions from existing relationships at this 
time, although approaches from two countries are curre ntly under consideration. An open air rights 
exchange can potentially be secured with New Zealand by countries becoming a party to the 
Multilateral Agreement on the Liberalization of In ternational Air Transpor tation referred to in 
footnote 69 (see http://www.maliat.govt.nz/). 
Q5 Paragraph 72 states that port access, related services, and inland transport must be negotiated 
on a commercial basis between carriers and service provi ders.  Is the same treatment given to foreign 
providers of such services as to New Zealand providers?   WT/TPR/M/216/Add.1 
 Page 13 
 
 
  Answer:  
Subject to approval under New Zealand's overseas investment regime, foreign providers of such 
services in New Zealand are subject to the same reg ulatory treatment as New Zealand providers of 
the same services.  No regulatory distinction is made between foreign shipping and domestic shipping 
in terms of port access and the provision of related services and inland transport services. 
 
Q6 According to paragraph 77, foreign investment in  the tourism sector is subject to the Overseas 
Investment Act 2005 and the Overseas Investment Re gulations 2005.  The sector is also subject to 
competition policy and the Commerce Act.  Are there any restrictions to foreign investment in the 
tourism sector? 
 
Answer:  
There are no specific investment restrictions in the to urism sector.  Investments in the tourism sector 
may be screened under the Oversea s Investment Act 2005 if they come within the thresholds specified 
in that Act. 
 
 
EC 
 
Q1 On 1 May 2009, changes were announced to NZAID's structure, mandate and objectives:  
http://www.beehive.govt.nz/release/cabinet+material +changes+nzaid.  To what degree may this 
recent announcement impact on NZAID's position vi s-à-vis the relevant provisions of the 
December 2005 WTO Ministerial Declaration?   
Answer:
 
The new mission statement for NZ's official devel opment assistance (ODA) programme is to "support 
sustainable development in developing countries, in  order to reduce poverty and to contribute to a 
more secure, equitable and prosperous world".  A core focus within the ODA programme is the 
pursuit of sustainable economic development.  This change places a greater emphasis on sustainable economic development.  As such, it is completely consistent with the relevant prov isions of the December 2005 WTO Ministerial 
Declaration which reaffirms the importance of trade -related technical assistance and Aid for Trade 
"to help developing countries build the supply-side capacity and trade-related infrastructure that they 
need to assist them to implement and benefit from WTO Agreements and more broadly to expand their 
trade".  
Reducing poverty is inherently linked to economic growth and trade.  The increased focus within 
NZAID's programmes on broad-based sustainable ec onomic development will include support for 
activities that help enable developing countries to expand their trade – by im proving infrastructure 
and related services, increasing support for th e private sector, and improving market analysis and 
support.    
Q2 Does New Zealand intend any further operational changes to its ODA and if so, how will they 
affect Aid for Trade?  
Answer:
 
There have been changes to NZAID's status that br ing NZAID into line with the standard management 
and accountability arrangements for the Ministry of Foreign Affairs and Trade.  These are largely 
technical changes and any changes that the Secretar y of Foreign Affairs and Trade may make to the 
management and other arrangements for NZAID will ensure that there is no undue risk to the 
capability to deliver a still-expanding Ne w Zealand Government ODA programme. 
 WT/TPR/M/216/Add.1 
Page 14  
 
  As noted previously, the change in NZAID's mandate is expected to see an even greater focus through 
our programming on activities that support sustai nable economic development, including Aid for 
Trade. 
 
Q3 What impact will NZAID's new direction have on its general budge t support (GBS) in the 
Pacific and other countries where it has provided GBS? 
 
Answer:
 
NZAID is committed to ensure the most effectiv e use of our ODA resources to achieve improved 
outcomes for poor people in developing countries, particul arly in the Pacific.  We shall look to use the 
most appropriate mechanisms to achieve this, in cluding general budget support where appropriate, in 
keeping with the Principles of Aid Effectiveness.  Any changes to NZAID programmes to reflect the 
increased focus on broad-based sustainable economic development will be introduced as existing 
activities are completed or are reviewed. 
 Q4 Is the Government of New Zealand intending to make any quantitative pledges/undertake any 
commitments as regards Aid for Trade? 
 
Answer:
 
New Zealand's funding for trade- related activities has increased since December 2005 and we had 
signalled continuing growth, even prior to th e recent announcement of an increased emphasis on 
sustainable economic development.  There will be significant increases in the amount and proportion 
of New Zealand ODA that is devoted to suppor ting economic development in partner countries, 
including Aid for Trade.  We are not, however, planning to make any specific quantitative pledges with respect to Aid for Trade. 
 Q5 By what indicators will NZAID judge the success of its trade and development policy? 
 
Answer:
 
The New Zealand Government has publicly signalle d its desire to see improved merchandise trade 
balances and increased tourism in Pacific Island economies, and to have a much more tangible 
impact on our developing partners' economic growth i ndicators, such as Gross National Income per 
capita.  Measuring the impact of NZAID' s increased engagement on sustainable economic 
development in the Pacific will be fully integrated  into NZAID's Programme  and Activity management 
systems.  Specific indicators will be developed as  we look for concrete, measurable results for 
businesses and individuals.  The OECD and WTO's wo rk to date on Aid for Trade indicators are 
useful inputs to this process.  
 
Q6 When does New Zealand think the roadmap fo r PACER+ negotiations will be finalised and 
what will the negotiating structure be?  
Answer:
 
Leaders at last year's Pacific Forum in Niue requested that the roadmap for PACER Plus be 
developed with a view to agreeing to  the commencement of negotiations at the August 2009 Forum.  
New Zealand will be working closely with Forum Me mbers to give effect to the Leaders' directive.  
The negotiating structure has yet to be agreed but we envisage that it is likely to consist of four (and 
not necessarily mutually exclusive) phases e.g info rmal consultations, natio nal consultations and 
research (the process of determining national impa ct and consulting with stakeholders), formal 
consultations (where coverage, schedule and moda lities of negotiations are settled), and formal 
negotiations (including the elaboration of legal texts). 
 
Q7 What specific outcomes does New Zealand desire from these negotiations?   WT/TPR/M/216/Add.1 
 Page 15 
 
 
  Answer:  
New Zealand's vision for PACER Plus is an agreemen t which will be genuinely supportive of Forum 
Island countries' (FICs') sustainable economic d evelopment.  New Zealand will be working towards 
an agreement that will contribute to the development of robust economies in the Pacific, equipping them better to withstand external shocks, to increa se jobs and export capacity in the PICs and address 
the trade imbalance between FICs and New Zealand.  
  Economic cooperation, capacity development, and tr ade facilitation should be core components of 
PACER Plus to ensure FICs have the tools necessary  to take advantage of trade liberalisation and 
manage the challenges it can present.  PACER Plus should be comprehensive in scope and contain 
core common components.  To meet the needs of al l members, however, the ag reement will need to be 
flexible and take account of individual countries' circumstances, sizes and stage of development.  
Q8 Could New Zealand provide an update on the last  developments regarding future adhesion of 
Australia, Peru and the United States to the P4?  Answer:
 
Since the announcements referred to in  the Secretariat's report, it has been agreed that Viet Nam will 
also participate in the TPSEPA negotiations as an associate member for th e first three rounds of 
negotiations, after which it will decide whether to join  the negotiations as a full participant.  The first 
round of negotiations involving the existing P4 members, the United States,  Australia, Peru and 
Viet Nam was scheduled to take pl ace in March 2009.  This first round was postponed to allow the 
new United States Administration time to conduct a ge neral review of its trade policy.  No dates have 
yet been set for the first round of negotiations. 
 
Q9 What specific outcomes does New Zealand desire from these negotiations? 
 
Answer:  
New Zealand's objective for the expanded TPSEPA negotiations is for an agreement that is 
comprehensive (covering all the main components of trade) and of a high st andard, and consistent 
with the WTO requirement that it cover "substantia lly all trade".  New Zealand also hopes that the 
TPSEPA will become a building block for greater eco nomic integration in th e Asia-Pacific region. 
 Q10 Could New Zealand describe the coverage in both trade and tariff lines of the China-New 
Zealand FTA? How many tariff lines have been excluded from the agreement?   
Answer:
 
The FTA provides for the removal over time of tariffs  on 96% of traded goods, which will equate to an 
annual duty saving of NZD115.5 million, based on current trade.  Tariff reductions are made on an 
annual, linear basis with final re ductions to be made in 2019. 
 The China-New Zealand FTA covers: 
- 100% of New Zealand tariff lines 
- 96% of China's tariff lines  
 214 of China's tariff lines are excluded from the agreement.  These include certain paper products 
and processed wood products.  These tariff lines constitute  approximately 4% of NZ exports to China.  
 
A number of these lines have exerts.   For more details please ref er to lines 4411.12.20, 4411.13.20, 
4411.14.20, 4411.93.00, 4414.00.00, 4415. 20.00 in the annex of the agreement.   
 
Q11 Could New Zealand describe in detail the coverage in both trade and tariff lines of the 
AANZFTA?  WT/TPR/M/216/Add.1 
Page 16  
 
   
Answer:
 
The key features of the agreement are shown by country in the table below.     
 
Country Specific Outcomes of AANZFTA  
Country Coverage of NZ Imports 
on Eliminated Lines Coverage of NZ Exports 
on Eliminated Lines Tariff Lines Subject to 
Elimination3 
Brunei Darussalam1 100% 100% 99% 
Cambodia 100% 86% 88% 
Indonesia 100% 99% 93% 
Laos 100% 2 88% 
Malaysia 100% 99% 96% 
Myanmar 100% 99% 85% 
Singapore 100% 100% 100% 
Thailand 100% 100% 100% 
The Philippines 100% 99% 95% 
Viet Nam 100% 99% 90% 
 
1 The agreement covers all of Brunei Darussa lam's tariffs except for a short list of pr oducts (alcohol, tobacco, and firearms) th at 
are exempted on moral, human health, and security grounds 
2 Recent import data from Laos is not available and a matching of  export data to Laos' tariff data has not been performed. 
3 Either immediately or via phasing.  
 
Q12 Could New Zealand explain how this agreem ent has built in former agreements among the 
Parties?   Answer:
 
The AANZFTA agreement sits alongside the outcom es of these FTAs and adds further value.  The 
region-wide nature of the agreement delivers benefits not achievable in New Zealand's other bilateral 
FTAs.  For instance, the agreement provides for regi onal Rules of Origin that encourage greater 
integration of production into regional and glob al supply chains.  The FTA also creates new 
opportunities for regional cooperation in a range of areas.  
Q13 Has this agreement improved the trade pref erences provided by former agreements amongst 
the Parties, and if so, how?  
 
Answer:
 
New Zealand's previous agreements with Australia , Singapore, Thailand,  and Brunei Darussalam 
were comprehensive agreements (except with Br unei Darussalam where a limited number of lines 
were excluded on moral, human health and security grounds).  AANZFTA brings forward the 
elimination date on a number of New Zealand tariff li nes (particularly with regard to Thailand).   
 
Q14 Could New Zealand further elaborate on if and how they intend to include social and labour 
issues in their regional/plurilateral agreemen ts (South Pacific Regional Trade and Economic 
Agreement SPARTECA, Asia Pacific Economic C ooperation APEC, Pacific Agreement on Closer 
Economic Relations (PACER), The Trans-Pacifi c Strategic Economic Pa rtnership Agreement 
(TPSEPA or TransPac or P4)), in the bilateral ag reements (Australia and New Zealand Closer 
Economic Relations Trade Agreement (ANZCERT A) New Zealand–Singapore Closer Economic 
Partnership (NZSCEP) New Zealand–Thailand Clo ser Economic Partnershi p (NZTCEP or TNZCEP) 
New Zealand and China FTA)) as well as agreem ents under negotiation (A SEAN-Australia/NZ Free 
Trade Agreement (AANZFTA) New Zealand and Malaysia Free Trade Agreement; New Zealand-Gulf Cooperation Council Free Trade Agreement)?  WT/TPR/M/216/Add.1 
 Page 17 
 
 
   
Answer:  
New Zealand believes that pursuing labour and envir onment objectives in the context of FTAs can 
contribute to sustainable development.  Sustainable development is about an integrated and mutually 
supportive approach to the goals of economic, social , environmental and cultural development.  FTAs 
contribute across all of these components.   
 New Zealand's approach to including labour and environment in trade agreements is based on mutual 
respect, common commitments, cooperation and consu ltation.  We seek to address these issues with 
flexibility and sensitivity, in a way suitable to the Parties concerned.  We will continue to pursue 
appropriate outcomes in our trade agreements. 
 New Zealand has concluded agreements  on labour and environment in the context of our FTAs with 
Thailand (through the CEP);  Brunei Darussalam, Chile and Singapore (under the framework of the 
Trans-Pacific SEP);  China (in the China-New Zealand FTA); and the Philippines (in the broad 
context of the ASEAN-Australia-New Zealand FTA) .  We have recently concluded negotiation of a 
bilateral FTA with Malaysia, which includes labour and environment provisions.  We are also in the 
process of negotiations with th e GCC, where we seek appropr iate provisions on labour and 
environment.    New Zealand supports addressing labour and envir onment issues in regional and plurilateral 
frameworks, and has been a key propo nent of projects in APEC, such as draft model measures on 
environment and labour, environm ental goods and services and hu man resources development.  We 
believe activity on these matters at all levels of e ngagement – bilateral, plurilateral, regional and 
multilateral – is important and in tegral to promoting the achievement of sustainable economic 
development. 
 
Q15 What percentage of tariff lines is covered by New Zealand's DFQF market access treatment for LDCs? Which products, if any, are excluded (or only get tariff reduction)? 
 
Answer:
 
Originating goods from least developed countries q ualify for duty free entry on 100% of dutiable 
tariff lines.  No LLDC originating produc ts are excluded from duty free entry. 
 
Q16 What degree of preference margin is gran ted under New Zealand's GSP scheme for "less 
developed countries"?  What is th e coverage of this GSP arrangeme nt and are any sectors or products 
excluded?  Could New Zealand provide details on the amount of trade covered by the GSP regime? 
 
Answer:  
As at 1 July 2008, the GSP scheme applied to only 327 tariff lines.  The margin of preference, as a 
percentage of the MFN applied rate, was 20% on almo st all tariff lines (325), 40% on 1 tariff line and 
60% on 1 tariff line. The GSP scheme now applies to only 4.5% of tariff lines (10.6% of dutiable tariff lines) for the reasons explained in paragraph III.27  of the Secretariat's report.  The GSP scheme 
never applied to clothing or footwear and in pr actice no longer applies to most tariff lines. 
 
Q17 Foreign investment legislation in New Zeal and was amended in 2005 and also in 2008.  A 
review of the Overseas Investment Act is ongoing  according to a recent press release with Finance 
Minister Bill English stating that the current overseas investment regime is "cumbersome" and that 
the rules are "often difficult to interpret" (see: http://www.beehive.govt.nz/release/government+ 
simplify+foreign+investment+rules).  New Zealand con tinues to screen investment in a few areas of 
"critical" interest, namely certain sensitive types of land, strategic infrastructure projects on sensitive 
land, "significant business assets" other than land, and fishing quotas.  Consequently, an amendment WT/TPR/M/216/Add.1 
Page 18  
 
  to the Overseas Investment Act in March 2008 resulted in the failure of a bid by foreign investors to 
acquire shares in the Auckland airport in April 2008.   Q17-1 What are the main changes that New Zeal and is planning to implement to its Overseas 
Investment Act in the context of the current review? 
 
Answer:
 
The objective of the review is to create an o verseas investment screening regime that promotes and 
encourages the flow of investment into New Zeal and, while addressing valid concerns about foreign 
investment.  Further information including the Terms of Reference for the Review are available from:  
http://www.beehive.govt.nz/release/government +simplify+foreign+investment+rules. 
 Q17-2 Will the changes imply lower costs for foreign investors?  
 
Answer:
 
The review aims to make foreign investment in Ne w Zealand simpler and more attractive.  In the past 
it has taken too long to process some overseas investme nt proposals - as a result of the complexity of 
the legislation - which has added to the costs for foreign investors.  Simplifying the foreign investment 
rules will help to redu ce costs for investors. 
 
Q17-3 Will the screening process time be significantly reduced? 
 
Answer:  
Some progress has already been made in reduc ing screening times and the Government wishes to 
reduce it further. 
 Q17-4 Are you considering changes to the current screening thresholds?  If so, what would the new 
thresholds be?  
Answer:
 
This issue is included in the terms of reference for the review.  No decisions on whether to change the 
thresholds have been taken. 
 
Q17-5 Are you considering changes to the definiti on of "sensitive land" as defined under the Act? 
 
Answer:  
The Terms of Reference note that the review will consider how the type and scope of land defined as 
sensitive under the Act can be refin ed to ensure that only land of particular significance or 
importance to New Zealand is screened.   
 
Q17-6 Will the regulation of 4 March 2008 enabling the Overseas Investment Office (OIO) to take 
into account "whether the overseas investment will, or is likely to, assist New Zealand to maintain 
New Zealand control of strategically important in frastructure on sensitive land" be maintained under 
the Act review? 
 
Answer:  
The review will consider how the tests that initial and ongoing investments must meet for consent to 
be granted under the Act, and the factors for determ ining benefit to New Zealand, can be altered to 
avoid deterring valuable investments and to minimise compliance costs. 
Q17-7 To what extent is it anticipated that the review will encourage an increase in FDI? 
  WT/TPR/M/216/Add.1 
 Page 19 
 
 
  Answer:  
Reducing the complexity of the screening regime is  expected to make the process for investing in 
New Zealand more straightforward.  There are ve ry few investments dec lined under the current 
screening regime so the changes are focused on simplifying the screeni ng process for investors rather 
than creating any significant jump in FDI. 
  
Q17-8 Does New Zealand intend to set any targets per annum concerning the level and type of new 
FDI that it desires?  
Answer:
 
No.  
Q18 Could New Zealand describe what are the exact  criteria applied for determining the origin of 
fish products in the context of prefer ential trade arrangements and regimes? 
 Answer:
 
New Zealand's overall framework for determining the origin of goods is that a good will be 
considered originating if it is:  (a) Wholly obtained;  or  (b) Produced entirely in the territory from goods originating in the territories of the 
Parties;  or 
 (c) Able to meet specific rules if non-origin ating materials are used in the production of 
the final good.  
 For the purposes of (c) above, New Zealand generally operates under a change to tariff classification 
approach when negotiating rules of origin in F ree Trade Agreements/Closer Economic Partnerships.  
There are some exceptions to this approach de pending on the negotiating party (e.g. AANZFTA has 
an optional regional value content (RVC) criteria).  An outline of the rules across New Zealand's agreements for fish products is prov ided below; with links to websit es displaying the specific rules of 
origin New Zealand has negotiated with our respective parties: 
- Headings 0301-0303: The rule is generally a change of chapter rule of origin for 
these headings. 
- Headings 0304-0305: The rule is generally a change of heading rule of origin for 
these headings. 
- Headings 0306- 0307: The rule is generally  a change of chapter rule of origin for 
these headings. 
 
Websites for New Zealand FTA/CEP rules of origin: 
 
NZ-Singapore:  http://www.mfat.govt.nz/Trade-a nd-Economic-Relations/0--Trade-archive/0--Trade-
agreements/Singapore/0-cep-part1.php ANZCERTA:http://www.med.govt.nz/templa tes/MultipageDocumentTOC____25083.aspx 
P4: http://www.mfat.govt.nz/Trade-and-Economic-R elations/0--Trade-archive/0--Trade-agreements/ 
Trans-Pacific/0-sep-index.php 
NZ-Thailand: http://www.mfat.govt.nz/Trade-and- Economic-Relations/0--Trade-archive/0--Trade-
agreements/Thailand/0-cep-index.php NZ-China:  http://chinafta.govt.nz/1-T he-agreement/2-Text-of- the-agreement/index.php 
AANZFTA:  http://www.asean.fta.govt.nz/preamble/ 
 
Q19 Recently MAF Biosecurity New Zealand has a pproved the importation of frozen and filleted 
Vietnamese catfish (basa) into New Zealand.  C ould New Zealand explain why the importation of 
such products was not allowed until now?  WT/TPR/M/216/Add.1 
Page 20  
 
  Answer:
 
Under New Zealand legislation (Biosecurity Act 1993), risk goods2 cannot be imported into New 
Zealand unless an import health standard is in pla ce.  An import health standard is based on an 
analysis of the risks of introducing pests and di seases associated with importing a risk good.  
 
An import health standard is developed on the re quest of a prospective importer, if no present 
standard, or standard for a closely-related product, a llows the risk goods in question to be imported.  
Until recently no market access requests had been received for importing frozen and filleted 
Vietnamese catfish (basa) into New Zealand.       
Two prospective importers requested MAF develop an import health standard for frozen, skinless, 
boneless basa fillets in 2006-2007.  As no appropriate  risk analysis was available as a basis for 
developing an import health standard, a formal  risk analysis was undertaken and completed on 
28 September 2008.  An import health standard was th en drafted, publicly c onsulted and subsequently 
issued for trade on 20 March 2009.  
 
Q20 "According to paragraph 38 under Article 4 of the ANZC ERTA Protocol, signed by 
New Zealand and Australia, as of 1 July 1990 anti-dumping actions may not be taken on goods 
covered by the agreement.  The Protocol extende d each country's competition law prohibitions on the 
misuse of market power to the market of the ot her."  The EC would like to learn more about the 
extension of each country's competition law.  Coul d New Zealand explain how this is applied in 
practice, in particular which competition authorit y can be called on in case of a misuse of market 
power and what kind of unfair competition is cove red by the ANZCERTA Protocol (e.g. antitrust;  
abuse of a dominant position; agreements between  undertakings and concerted practices which may 
affect trade between Australia and New Zealand)? 
 
Answer:
 
In 1990, New Zealand and Australia's domestic co mpetition laws were extended to prohibit certain 
anti-competitive behaviour by firms in one country t hat have market power in the other country, or in 
a combined Australian/New Zealand market.  Specifically, New Zealand extended the abuse of market power provisions in the Commerce Act 
(section 36) by prohibiting parti es with a substantial degree of power in a market in either 
New Zealand, Australia, or both countries from taki ng advantage of that position by restricting entry 
into, preventing or deterring competitive conduct in, or  eliminating anyone from a market.  However, 
a market may not be one exclusively for services (section 36A).   
The purpose of extending the definition of a market to include a trans-Tasman one was to provide 
remedies with respect to monopolistic behaviour such as predatory pricing between the two countries, 
although non-price conduct is covered as well.  Therefore all sorts of  unilateral exclusionary 
practices are covered e.g. refusals to deal, the u se of buying power or lobbying power to increase 
rivals' costs, and actions which amount to abuse of  legal, judicial or governmental administrative 
processes to disrupt the competitive process. 
 
Market definition plays a large part in giving effect to  the provisions.  Section 4(2) of the Commerce 
Act singles out section 36(A) which "extends to the engaging in conduct outside New Zealand by any 
                                                     
 
2 Risk goods  means any organism, organic material, or other thing, or substance, that (by reason of its 
nature, origin, or other relevant factors) it is reasonable to suspect constitutes, harbours, or contains an organism 
that may – 
-  (a) Cause unwanted harm to natural and physical resources or human health in New Zealand;  or -  (b) Interfere with the diagnosis, management, or treatment, in New Zealand, of pests or unwanted 
organisms.  WT/TPR/M/216/Add.1 
 Page 21 
 
 
  person resident or carrying on business in Australia to  the extent that such conduct affects a market, 
not being a market exclusively for services, in New Zealand". 
 The Commerce Commission has not had to apply section 36A in practice.  It has received occasional 
queries and complaints since the amendment was made, although none have warranted opening an 
investigation and therefore no cases have been taken to  Court.  However, as well as the Commerce 
Commission, a section 36(A) action, relating to relev ant conduct in a New Zealand market, could also 
be taken by various legal persons: 
- by a New Zealand firm against an Australi an firm with substantial market power in 
either Australia, New Zealand or a combined market. 
- by an Australian firm operating in a New Zealand market against another Australian 
firm with substantial market power in any of those markets. 
- by a New Zealand firm agai nst another New Zealand firm with market dominance in 
any of those markets, where the second firm also operates in Australia and engages 
in relevant conduct there which affects a market in New Zealand. 
 
Q21 Could New Zealand also indicate why each c ountry's state aid law is not extended to the 
market of the other?  
Answer:
 
New Zealand does not have a state aid law. 
 
Q22 A review of New Zealand's countervailing dut ies against the imports of canned peaches from 
the EC is currently underway, having been initia ted by a request from New Zealand's industry to 
extend the duration of the current measures.  (See: http://www.med.govt.nz/templates/Sta ndardSummary____39919.aspx and http://www.med. 
govt.nz/templates/StandardSummary____39918.aspx)  
 What is the market share in New Zealand of ca nned peaches from domestic production compared to 
imported peaches and what has been the trend over the past ten years?  
Answer:
 
The market share held by the New Zealand industry cannot be released as to do so would allow its 
confidential sales volume figures to be calculat ed.  The New Zealand industry has, however, suffered 
an overall loss of market share over the last 10 years. 
 
Q23 In view that a mere initiation of an investiga tion can result in trade-restrictive effects, how is 
New Zealand making sure that unjustified c ountervailing cases are avoided and do not cause 
unnecessary trade disruption?  
Answer:
 
New Zealand strictly applies the criteria in Artic le 11 of the WTO Agreement on Subsidies and 
Countervailing Measures in assessing whether to initia te a countervailing investigation.  It should be 
noted that New Zealand has not initiated a ne w countervailing investigation since 1997.   
 In addition, New Zealand undertakes a thorough review of the need to maintain countervailing duties either every 5 years if requested to do so by a domes tic industry that provides sufficient evidence to 
warrant such a review, or more frequently if re quested to do so by an interested party that 
substantiates the need for a review, in te rms of Article 21 of the SCM Agreement. 
 
Q24 The EC and NZ have been negotiating amendments to their 1999 mutual recognition 
agreement since 2006.  When does New Zealand expect to finalize the current draft of the agreement? 
 WT/TPR/M/216/Add.1 
Page 22  
 
  Answer:
 
We are aiming to provide the EC with the finali sed draft text for the amendment to the 1999 Mutual 
Recognition Agreement this month. 
 
Q25 New Zealand maintains a highly stringent sanitary and phytosanitary regime.  Through its 
bio-security policy, it has effectively restricted th e import of most non-pasteurised cheese, fresh eggs 
and live poultry.   Q25-1 Would New Zealand explain the objectives pursued through its SPS policy?   Answer:
 
The objectives of New Zealand's SPS policy are to ensure that any risks to human, animal and plant health associated with importing risk goods or fo od products are managed to an acceptable level.  As 
noted in the report of the Secretariat, some products  may not be imported until their risk to human, 
animal and plant health is assessed (WT/PR/S/216, page ix, paragraph 12).   
 
For example, New Zealand is free from many OIE listed diseases that are common throughout much 
of the world.  New Zealand is free of infecti ous bursal disease, notifiable avian influenza, and 
paramyxovirus I with an intracerebral pathogeni city index greater than 0.16.  Unrestricted 
importation of live poultry and fresh eggs from countries in which these diseases occur would present a significant risk to maintenance of New Zealand's cu rrent animal health status – in other words, 
zoosanitary measures for poultry, fresh e ggs (and poultry meat) are justified. 
 
Q25-2 How would the Government justify pursuan ce of the above-mentioned policy in the light of 
multilateral disciplines under the WTO agreement on SPS measures? 
 
Answer:
 
New Zealand is committed to applying the multila teral disciplines under the WTO agreement on SPS 
measures when implementing its SPS policy.  A p re-import assessment of risk allows New Zealand to 
identify what, if any, measures are scientifically justified to  manage to an acceptable level any risks 
associated with importing risk goods or food products. 
 Q25-3 If all New Zealand SPS authorities share the view that "the pursuit of a "zero risk" policy is 
not realistic", what levels of risk are considered acceptable to New Zealand? 
 
Answer:
 
New Zealand, like many other countries, has not a ttempted to quantify what its appropriate level of 
protection (acceptable level of risk is) in precise  terms.  New Zealand's appropriate level of 
protection can be inferred over time from the total picture of decisions that have been made on SPS 
measures.    
Q25-4 How many requests for the development of import health standards have been received by 
MAFBNZ and how many import health standard s have been published during the period under 
review?  
 
Answer
 
MAFBNZ began recording the number of requests for d eveloping import health standards in 2006.  
For the first two years, 2006 and 2007, requests we re collated annually.  MAFBNZ then moved to a 
two-yearly process so the next collation wa s 2009.  The number of requests are:  
2006 267 2007 278 2009 226   WT/TPR/M/216/Add.1 
 Page 23 
 
 
  MAFBNZ counts the number of import health standard s published in years from 1 July to 30 June.  
The numbers are: 
 
From 1 July To New and Revised Standards issued 
2006  30 June 2007 26 
2007 30 June 2008 24 
2008 29 May 2009 21 
 
New import health standards commonly address multiple country and commodity market access 
requests.  
Q25-5 What is the average length of time it takes to develop an import health standard?  What efforts 
are being made to speed up procedures?   
Answer:
 
MAFBNZ does not routinely measure how long it ta kes to develop an import health standard.  
Attempts to measure an average length of time a re complicated because m any risk analyses may be 
used to develop a single import health standard, or  one risk analysis may be used for several import 
heath standards, over several years.  Additionally, the complexity of, and priority for, completing 
individual risk analyses also varies further complica ting attempts to calculate an average length of 
time to develop an import health standard.    
A programme of work has been initiated to improve border risk systems and processes.  Effective and 
timely development of import health standards  is within the scope of this programme. 
 
Q25-6 According to clause 4.1 of the document "Importing Pig Meat for Human Consumption from 
the European Union released by Biosecurity Ne w Zealand (http://www.biosecurity.govt.nz/ihs/ 
meaporic.eec), "a permit to import is not required for 'Prosciutto di Parma' or 'Parma ham type' 
products or products that have either a) "been h eat treated to a core temperature of one of the 
following core temperature/time parameters… ";  b)  "during processing been subjected to a procedure 
which ensured the meat achi eved a pH of 5 or below" or "achieve d a pH 7 or above";  c) "qualified for 
official certification as Prosciutto di Parma";  or "have undergone an equivalent 12 month curing 
process";  or "are free of bone and have been heat treated to achieve a core temperature of 70°C or 
higher for a minimum of 25 minutes".  The EC would appreciate clarification of the pH requirement 
mentioned in the above-quoted clause 4.1 b).  In particular, could New Zealand specify the meaning 
of "during processing"?  
Answer:
 
Rapidly changing pH of the meat is a well-known sanitary treatment for  manufacturing salami and 
other meat products.  This is what New Zealand me ans by "during processing" – the manufacture of 
salami and other meat products.  The pH treatments cited are designed to inactiv ate the virus that causes Porcine Reproductive and 
Respiratory Syndrome.  It is generally recognised that  the infectivity of the virus is reduced by over 
90% at a pH of less than 5 or greater than 7
3. 
 
Q26 Are the principles of non-discrimination and openness regulated? 
 
                                                      
3 EFSA. 2005.  Scientific Opinion on “The probability of transmission of Porcine Reproductive and 
Respiratory Syndrome virus (PRRSv) to naïve pigs via fresh meat”  EFSA Journal 239:  p 10. WT/TPR/M/216/Add.1 
Page 24  
 
  Answer:
 
Under the Land Transport Manage ment Act 2003, the NZ Transpor t Agency prescribes open and non-
discriminatory competitive procedures for ce ntral and local government procurement of 
transport infrastructure and services.  Otherwise, there are no  government procurement regulations, 
but the Cabinet has directed central government depar tments to give effect to the principles of non-
discrimination and openness through Mandatory Rul es for Procurement by Departments (2006). 
 
Q27 Does New Zealand plan to introduce a general legislation on public procurement in the future 
or to issue guidelines also  for sub-central agencies? 
 Answer:
 
There are no plans to introduce general legislation on public procurement.   Sub-central agencies 
(local government authorities) are encouraged (but not mandated) to follow the general Policy Guide 
for Purchasers (2007) and the Mandatory Rules for Procurement by Departments (2007).  Guidelines 
issued by the Office of the Auditor-General in  its publication Procurement Guidance for Public 
Entities (2008) are written to assist all public entities, including local authorities . 
 Q28 The EC welcomes New Zealand as an observer to the WTO plurilateral agreement on Government Procurement (GPA) since December 2008.   Does New Zealand inte nd to become a full 
signatory to the GPA?  Answer:
 
New Zealand became an observer on the GPA committ ee without commitment as to GPA membership. 
This matter is however under continuing review in the light of domestic and international developments.  
 Q29 What is the evolution in recent years of Font erra's share in the allocation of export licences 
for the EC dairy quotas?  How many other compan ies export under these quotas and what is their 
share? Could New Zealand provide information as to the share of export licences under other dairy 
quotas such as to Canada, Japan, the US and the Dominican Republic?  
Answer:
 
 
2008 Quota Allocation table 
 
2008 Quota allocation EU Butter EU Cheddar EU Cheese for 
Processing Dominican 
Republic Milk 
Powder 
Fonterra Co-operative Group Li mited 98.7% 99.2% 99.2% 94.9% 
Westland Cooperative Dairy Company Ltd 0.8% 0.8% 0.8% 3.2% 
Tatua Cooperative Dairy Company Ltd 0.2% 0% 0% 1.0% 
Open Country Cheese Company Ltd 0.2% 0% 0% 0.9% 
 
2009 Quota Allocation table 
 
2009 Quota allocation EU Butter 
2009 EU Cheddar 
2009 EU Cheese 
for Processing 
2009 Dominican 
Republic 
Milk Powder US Low Fat 
Cheese 2009 US Cheddar 
Cheese 2009 
Fonterra Co-operative 
Group Limited 97.0% 97.4% 97.8% 94.3% 96.6% 94.3% 
Westland Cooperative 
Dairy Company Ltd 1.7% 1.7% 1.7% 3.3% 3.6% 3.3%  WT/TPR/M/216/Add.1 
 Page 25 
 
 
  Tatua Cooperative Dairy 
Company Ltd 0.5% 0.5% 0% 0.9% 0% 0.9% 
Open Country Cheese 
Company Ltd 0.5% 0.5% 0.6% 1.0% 0% 1.0% 
Synlait Ltd 0.1% 0% 0% 0% 0% 0% 
New Zealand Dairies Ltd 0.2% 0% 0% 0.5% 0% 0.5% 
 
Q30 How much of the exports in the 11 designated markets (TRQs for dairy products in EC, 
Canada, Japan...) are not done by Fonterra?  In ot her words, does the change in the DIRA regulation 
to allow access to other dairy companies to use part of these TRQs have any effect as compared to the 
old practice in which Fonterra had exclusive rights to use these TRQs?  
Answer:
 
See table above.  
Q31 Are there any plans to alter Zespri's  status as a state trading enterprise?  
 
Answer:
 
There are no plans to alter Zespri's current status. 
 
Q32 How frequently do allocation assessments occu r to determine companies' dairy access rights 
to export certain dairy products subject to tariff quotas or other restrictions in overseas markets? 
 
Answer:  
Annually in September for the following  quota year (1 January to 31 December). 
 
Q33 To what extent are the smaller dairy processo rs expected to be allocated more dairy access 
rights in the next five years? How is th eir share of access rights expected to grow? 
 
Answer:  
Over the next five years quota for all quota markets will be allocated according to the share of raw 
milk dairy companies collect from dairy farmers in New Zealand.   The Ministry of Agriculture and Forestry estimates that over the next five years, based on current 
trends, other dairy companies will increase their share of raw milk collected from dairy farmers in 
New Zealand to around 16%.  Therefore independe nt dairy companies would be allocated around 
16% of quota for each quota market.  However, the accuracy of this estimate will depend on how the 
economy performs in this current economic climat e, including the ability for new ventures to get 
access to capital at reasonable cost.  
Q34 The WTO Secretariat Report states that GIs are currently protected under consumer protection legislation (the Fair Trading Act 1986) and the common law tort of passing-off. Are those 
two mechanisms the sole available or do othe r mechanisms exist for the protection of GIs? 
 
Answer:
 
There are other mechanisms available to pr oducers to protect their GI, these including: 
- The use of registered and unregistered cer tification and collective marks and in this 
regard a number of German wine GIs, such as FRANKEN, RHEINGAU, NAHE, and 
WURTTEMBERG have been registered as certification marks in New Zealand by 
German wine producers;  
- The application of various food standards established by the Food Standards 
Australia New Zealand to food products  (http://www.foodstandards.gov.au/ 
thecode/foodstandardscode/index.cfm, in partic ular, the Spirits Standard 2.7.5.;  and WT/TPR/M/216/Add.1 
Page 26  
 
  - Specific regulation governing labels for various foodstuffs, such as the Wine 
Specification Notice 2006 issued under the Wine Act 2003. 
 
Q35 Are wines and spirits currently protected via specific mechanisms compared to other 
products? 
 
Answer:
 
All products are protected under the same general fr amework, but specific provisions apply in some 
circumstances for wines and spirits ( see FSANZ Standard 2.7.5 for spirits: 
www.foodstandards.gov.au/_srcfiles/ Standard_2_7_5_Spirits_v101.pdf a nd Wine Specification Notice 
2006 issued under the Wine Act 2003 Wine Ac t 2003 for wines http://www.nzfsa.govt.nz/ 
wine/legislation/wine-notice-2006.pdf). 
 
Q36 Article 23 of TRIPS provides for an additio nal protection for geographical indications for 
wines and spirits.  More specifically, Articles 23.1 and 23.2 of TRIPS provide for protection of the 
latter irrespective of any "subjective" criteria, i.e. irrespective of whether the public would be misled 
as to the true place of origin or whether the use of the GI would constitute an act of unfair competition.  The relevant provisions of the Fair trading Act and the common law tort of passing-off 
rely on those subjective criteria.  At the same time , the Geographical indications Act of 1994 has been 
repealed while the Geographical indications (Win e and Spirits) Registration Act of 2006 has not yet 
come into force.  In this context, could New Zeal and explain whether there is currently a registration 
system for geographical indications? 
 
Answer:
 
The Geographical Indications (Wine and Spirits) Registration Act 2006 provides a specific 
registration system for geographical indications in rel ation to wines and spirits.  This Act has not yet 
entered into force.  The geographical terms relati ng to other products c an be registered under the 
Trade Marks Act 2002 as certification or collective marks. 
 
Q37 Could New Zealand explain more specifi cally by which means it is implementing:  
 a) Article 23.1 of TRIPS as regards wines on the one hand and spirits on the other hand;  
 
Answer:
 
New Zealand case-law clearly establishes that the Fair Trading Act 1986 and the common law tort of passing off fulfils the requirements of Article 23.1.   For example, the Com ite Interprofessionnel du 
Vin de Champagne v Wineworths Group Limited  [1991 2 NZLR 432] case found that the word 
"champagne" was distinctive in New Zealand for the F rench product and was not used generically to 
describe any white sparkling wine.  As a result, th e court ruled that word  "champagne" could not be 
used in New Zealand to describe sparkling wine made outside the Champagne region in France, even 
when the true origin of the goods was indicated.   In addition, as set out above in our response to 
Question 34, producers of wines and spirits could choose to protect their GIs through registration of certification marks. 
 
b) Article 23.2 of TRIPS as regards wines on the one hand and spirits on the other hand? 
 
Answer:
 
Sections 17(1)(a) and (1)(b)(i) of the Trade Marks Act provides for the Commissioner of Trade Marks 
to refuse to register a trade mark or part of a trade mark: 
- Any matter the use of which would be likely to deceive or cause confusion4;  and 
                                                      
4 The Trade Marks Examination Guide instructs an examiner to object to a trade mark application when 
the examiner is faced with information demonstrating that  the geographical reference in a trade mark application  WT/TPR/M/216/Add.1 
 Page 27 
 
 
  - When its use is contrary to New Zealand la w or would otherwise be disentitled to 
protection in any court5.   
 Sections 47 to 49 provide for any person to op pose the registration of a trade mark on any the 
grounds upon which the registration can be ref used by the Commissioner of Trade Marks. 
 
Section 73 provides for an aggrieved person to apply fo r declaration of invalidity to cancel a register 
trade mark on the grounds that the mark was not registrable at its deemed date of registration. 
 
Q38 Once implemented, in what ways is th e Geographical Indications (Wine and Spirits) 
Registration Act 2006 expected to "complement"  the existing level of GI protection?  
 
Answer:
 
Sections 21 to 24 of the Geographical Indications (Wine and Spirits) Registration Act 2006 specify the 
conditions under which a New Zealand registered  geographical indication be used and any person 
who contravenes these conditions of use contravenes section 9 of the Fair Trading Act 1986 and the 
remedies under that Act accordingly apply.    Registration of geographical indication under th e Geographical Indications (Wine and Spirits) 
Registration Act 2006 would, therefore, effectivel y be equivalent to establishing reputation and 
goodwill necessary for taking action against misleading and deceptive use of a geographical 
indication under the Fair Trading Act.  
Q39 The WTO Secretariat report notes that "The  Geographical Indications (Wine and Spirits) 
Registration Act 2006 (…) is intended to replace th e Geographical Indications Act 1994". What are 
the implementation issues to be addressed to bring the 2006 Act into force and what is the expected 
timeframe for those issues to be addressed? 
 
Answer:
 
Current impediments include: 
- Securing the necessary additional res ources to develop and implement the 
procedures and systems required by the Intellectual Property Office of New Zealand 
(IPONZ) to administer the register.  
- The development and approval of suitable regulations governing the administrative 
procedures concerning the register. 
- The development, approval and implementation of an appropriate fees regime for the 
recovery of the costs to IPONZ for administering the register. 
- New government restrictions concerning the implementation of new regulations with 
regulatory and compliances costs impacts for businesses. 
In the current economic climate it is difficult to sp eculate when these impediments will be overcome. 
 
Q40 The Geographical Indications (Wine and Sp irits) Registration Act 2006 will only apply to 
geographical indications for wines and spirits.  Do es New Zealand law provide for a definition of 
"geographical indications" for GI pr oducts other than wines and spirits? 
 
Answer:  
No. 
                                                                                                                                                                     
is inaccurate, such that consumers might believe that th e goods or services originate from that geographical 
place, and where it is clear that the goods or services in  respect of which the application has been made do not 
actually originate from that geographical place. 
5 For example where a court decision has been is sued finding that the use of the geographical 
indications contravenes the Fair Trading Act 1986. WT/TPR/M/216/Add.1 
Page 28  
 
   
Q41 Following the entry into force of the Geogra phical Indications (Wine and Spirits) Registration 
Act 2006, does New Zealand intend to provide for such a definition?  
 
Answer:
 
No.  
Q42 Irrespective of such a definition, does New Zealand intend - in light of Article 22 of TRIPS - to amend its Trademark Act to enshrine specific provisions related to the relationships between 
trademarks and geographical indications fo r products other than wines and spirits? 
 
Answer:
 
No.  The relationship between geographical indica tions and trade marks for products is already 
sufficiently addressed in the Trade Marks Act and an amendment is not considered appropriate or 
necessary. 
 
Q43 Does New Zealand intend to provide for a regi stration system of geographical indications for 
GI products other than wines and spirits?  
Answer:
 
There is no intention to provide a sui generis registration regime for geographical indications other 
than wines and spirits.  As noted above, the Trade Marks Act 2002 provides for geographical terms 
relating to all products to be registered as certification or collective marks.  Furthermore, 
New Zealand's policy development framework requir es the identification of a problem of sufficient 
nature and magnitude to warrant regulatory int ervention by the Government.  Presently there is no 
evidence that the is any issue or problem with New Zealand's existing regime for the protection of 
geographical indications that would necessitate the development of a registration regime specifically 
for geographical indications for products other than wines and spirits. 
 
Q44 Paragraph 12 of the Secretariat's report states that Zespri has the "automatic, but not the sole right to export kiwi fruit".  Could New Zealand pl ease inform us whether this is the same as a 
statutory monopoly and if not, what is the difference? 
 
Answer:
 
ZESPRI Group Limited is not a statutory monopoly because it is not established by any company-
specific legislation.  It is a company incorpor ated under generic New Zealand corporate law (the 
Companies Act 1993), and kiwifuit suppliers to ZESPRI  are its shareholders.  ZESPRI, however, has 
almost exclusive rights, under Kiwifruit Export Regula tions 1999, for exports of kiwifruit to markets 
other than to Australia.  That right is "automatic, but sole" due to the fact that there is a provision under the Kiwifruit Export Regulations 1999 for oth er exporters to also export to markets other than 
to Australia under a collabora tive marketing arrangement.  
 
Q45 To what extent do independent New Zeala nd processors have access to milk, by region?  
 
In the 2007/08 season other dairy companies collect ed from dairy farmers approximately 6% of 
New Zealand's raw milk production, of which, one th ird came from the North Island and two thirds 
from the South Island.  In addition, in the 2007/08 season other dairy processors accessed 410 million 
litres of raw milk from Fonterra under the Dairy Industry Restructuring (Raw Milk) Regulations 
2001, equivalent to approximately three percent of New Zealand’s raw milk production.  So, 9% in 
total.  The Ministry of Agriculture and Forestry (MAF) es timates that in the 2008/09 season other dairy 
companies will collect from dairy farmers approximat ely 8% of New Zealand's raw milk production,  WT/TPR/M/216/Add.1 
 Page 29 
 
 
  including 2.5% of national raw milk production in the North Island and 5.5% in the South Island.  In 
addition, MAF estimates that in the 2008/09 season other dairy companies will access approximately 500 million litres of raw milk from Fonterra under the Dairy Industry Restructuring (Raw Milk) Regulations, equivalent to approximately three p ercent of New Zealand raw milk production.  So, 
11% in total. 
 
Q46 How many independent dairy processing plan ts have opened and closed since 2001?  
 
Answer:
 
Since 2001, 7 new milk processing plants have commenced operations and of those 1 has 
subsequently closed down.  Another plant established pre-2001 has also closed trading.  
Q47 Does New Zealand have targets regarding the reduc tion of Fonterra's size in order to constrain 
its domestic domination? 
 
Answer:
 
New Zealand does not have targets regarding the reducti on of Fonterra's size in order to constrain its 
domestic dominance; however, we do have specific pro-competition elements which fall away when 
the competitive pressure on Fonterra has increased to  significant levels.  An example of such 
pro-competition elements is provided by the Dair y Industry Restructuring Act 2001, sections 4(f) and 
Subpart 5, section 70. 
 Q48 Paragraph 21 mentions that "The total allowable commercial catch (TACC), a subset of the 
TAC, is determined after taking into account non- commercial fishing interests and other fishing 
induced mortality ." 
 
Q48-1 Could New Zealand clarify the meaning of  "non-commercial fishing interest"? Is the 
allocation made under this concept the same as what it is called "customary fishing"? 
 
Answer:
 
Section 21 of the New Zealand Fisheries Act defi nes "non-commercial fishing interest" as being 
Maori customary non-commercial fishing interests and recreational interests. 
 
Q48-2 Who are the beneficiaries of this allocation?  A particular group or particular individuals? 
 
Answer:  
The allowance is not a commercial allocation to a particular group of beneficiaries. In setting a 
sustainable total allowable commercial catch the Minister must allow for: 
 a) the customary non-commercial fishing of  Maori tribes (iwi) and sub-tribes (hapu); 
 b) the recreational catch of all recreational fishers;  and  c) all other mortality to that stock caused by fishing. 
 
Q48-3 Under what economic terms is  this allocation made?  Are the allocations made at no cost for 
the beneficiaries?  Are they tradable? 
Answer:
 
The allowances are made, by definition, to acco unt for non-commercial resource users taking fish to 
meet their requirements, therefore there are no associated economic terms or costs. 
 
These allowances are not tradable, nor can the catc h made under these allowances be used in any 
form of barter or trade. 
 WT/TPR/M/216/Add.1 
Page 30  
 
  Q48-4 Can products harvested under this allocati on be exported?  Could the fishing operations 
carried out under this allocation be considered as "artisanal", or "small scale" or "subsistence" 
fisheries?   
Answer:
 
Under Section 21 of the New Zealand Fisheries Act,  products harvested under this allowance may not 
be sold or subsequently traded.   Only fish, aquatic life, or seawe ed taken by commercial fishers may 
be sold, and subsequently purchased by a licensed fish  receiver.  Fish can be exported as a gift, but 
cannot be sold.  Regulations limit the amount any person can take overseas to twice the recreational 
daily bag limit for that fish stock. 
 
Fishing operations carried out under this allowan ce are not considered as "artisanal", or "small 
scale" or "subsistence" fisheries.  Customary non-co mmercial fishing is fishing carried out under the 
authority of an authorisation or permit issued under the Fisheries (South Island Customary Fishing) regulations 1999, the Fisheries (Kaimoana Customary Fishing) Regulations 1999 or regulation 
27 and 27A of the Fisheries (Amateur Fishing) Regulations 1986.  In the case of the two sets of 
customary regulations customary food gathering is defined as:  "the traditional rights confirmed by the Treaty of  Waitangi and the Treaty of Waitangi (Fisheries 
Claims) Settlement Act 1992, being the taking of  fish, aquatic life, or seaweed or managing of 
fisheries resources, for a purpose authorised by Tangat a Kaitiaki/Tiaki, including koha, to the extent 
that such purpose is consistent  with Tikanga Maori and is neither commercial in any way nor for 
pecuniary gain or trade:"  The main customary purposes are hui (tribal meeti ngs, often involving external visitors) and tangi 
(funerals), for which occasions the provision of local food (especially seafood) is an essential cultural 
protocol. 
 
Q49 In paragraph 24 it is menti oned that "Fishing quotas and ACE may only be held by nationals 
of New Zealand or by majority-owned domestic companies;  permission may be granted, under 
certain circumstances, by the Minister of Fisheries and the Minister of Finance, for an overseas person 
to hold a fishing quota in New Zealand (Chapter II(5))."  Footnote 76 of Chapter II (page 32) 
mentions increased export receipts for New Zeal and exporters among the factors for determining 
whether overseas investment in fishing quota is in the national interest.  However the Fisheries Act 
1996 in 4:  Quota management system, 57.(4).(b) (C) mentions "the deve lopment of new export 
markets or increased export" as a factor for determin ing whether foreign investment is in the national 
interest.  Does this imply that New Zealand w ould allow purchase of fishing quota by an overseas 
investor in exchange for trade concessions (e.g. im port duty reductions) by the country to which the 
foreign investor belongs?  
 
Answer:
 
No.  Trade concessions by the Government of the country of a potential foreign investor would not be relevant to a determination by Ministers to allow the purchase of fishing quota by an overseas 
investor. 
 
Q50 In paragraph 26 it is mentioned that New Z ealand introduced in September 2008 an emission 
trading scheme.  According to publicly available information the fisheries sector is being treated 
differently than other sectors as will receive a free allocation of emission units covering 50% of the 
total of all eligible parties' 2005 emissions from th e consumption of fuel.  This free allocation will be 
provided each year from 2011 to 2013.  Furthermore,  the official webpage explaining the functioning 
of the emission trading scheme mentions (see text he reunder) that this measure is a subsidy, for which 
one of the main raisons d'être is the fact  that this sector is exposed to trade. 
  WT/TPR/M/216/Add.1 
 Page 31 
 
 
  "Free allocation is being provided to  various groups under the emissi ons trading scheme for a range of 
reasons.  It's technically a subsidy, but it's a tr ansitional measure only available to some emitters." 
"The rationale for free allocation of emissions units to  forestry and fishing is more that asset values 
are affected by introducing the emissions trading sch eme, so allocation aims to achieve equity rather 
than deal with economic regrets.  Having said this, there is an elem ent of trade-exposure underpinning 
the rationale of providing free allocation to th e fishing sector." (http://www.climatechange.govt.nz/ 
emissions-trading-scheme/questions -and-answers.html#fishing) 
 
Could New Zealand confirm the above information? 
 Answer:
 
New Zealand can confirm that an amendment to the Climate Change  Response Act 2002, passed in 
September 2008, introduced an emissions trading scheme.  This scheme was designed as a key 
instrument to introduce, over time, a price on ca rbon across the New Zealand economy.  The scheme 
covers all sectors and the six main greenhouse gases, and,  as such, is one of the most comprehensive 
schemes of its kind in the world. 
 The current legislation contains provision for f ree allocation as a transitional measure to some 
sectors of the economy whose competitiveness may be at risk, due to uneven coverage and pricing of 
carbon across economies in the short term, resulting in carbon leakage.  Pa rtial and transitional free 
allocation is envisaged for some sectors, including forestry, industry, agricu lture and fishing, to adapt 
to this domestic policy measure of emissions pr icing in the New Zealand emissions trading scheme 
(ETS).    We note that other emissions trading schemes, in cluding the EU ETS, also involve the use of free 
allocation. 
 
The legislation is currently being reviewed by  a special Parliamentary select committee, the 
Emissions Trading Scheme Review Select Committee.  Some of the information contained in the website quoted was incorrect, and does not reflect the official view of the New Zealand Government.  
 
Q51 Given that most of New Zealand's fish produc tion is intended for export, such subsidy can be 
considered a "de facto" export subsidy.   
Answer:
 
We disagree.  There remains considerable uncertai nty internationally about the application of WTO 
rules to measures such as free allocation under an emissions trading scheme, which is designed 
explicitly to enable countries to meet multilateral clim ate change objectives.  These provisions simply 
level the playing field to avoid a distortion from  the application of domestic policy to meet 
multilateral objectives.  This is consistent with em erging international practice to provide a level of 
transitional assistance under an ETS.  
 
Q52 Has New Zealand carried out an analysis demons trating that the cost of the emissions trading 
scheme cannot be passed to customers (most of th em third country importers) of New Zealand's 
fishing industry?   Answer:
 
New Zealand is a price taker on international market s:  the Emissions Trading Scheme will not 
change this. 
 WT/TPR/M/216/Add.1 
Page 32  
 
  Q53 Has New Zealand quantified the financial benefit for New Zealand's exporters of the 
aforementioned subsidy?  
Answer:
 
There will be no net financial benefit to New Zealand' s fishing industry resulting from this transitional 
measure.   The industry will face higher fuel costs gi ven the inclusion of liquid fuels in the ETS.  The 
free allocation will offset only a portion of those costs for a limited period of time.   KOREA
 
 
Q1 The Government report states that New Zeal and (NZ) is "pursuing a number of initiatives 
aimed at improving the country's economic performance, " and in this context mentions two policies, 
the "Growth and Innovation Framework", and the "Economic Transformation Agenda".  Could 
New Zealand elaborate on these two policies?  In particular; 
 
Q1-1 For both the "Growth and Innovation Framew ork" policy and the "Economic Transformation 
Agenda" policy, could NZ further elaborate on the de tailed features of each policy, and an assessment 
on the results of each?  
Answer:
 
The Growth and Innovation Framework (GIF) ai med to increase productivity by investing in 
improved innovation systems, workforce skills and international connections, and developing clusters 
of firms in four key sectors:  1) Biotechnology  2) Information and communications technology 
 3) Design 
 4) Screen production  Further detail on the policy measures developed as part of GIF are archived on the Ministry of Economic Development website at:   http: //www.med.govt.nz/templates/StandardSummary____ 
38194.aspx.  Progress reports discussing some results  of GIF are available at:  http://www.med. 
govt.nz/templates/ContentTopicSummary____38419.aspx.  
The Economic Transformation Agenda (ETA) focused on improving the genera l climate for economic 
growth rather than developing certain sectors.  It so ught to raise productivity and catalyze the growth 
of high-value-added New Zealand firms.  To do  so, the Government in vested in five areas: 
 1) Infrastructure investment in land transport and broadband; 
 2) Skills and productivity;  3) Developing globally competitive firms;  4) Supporting Auckland as a world city;  and  5) New Zealand leadership in environmental sustainability.  
Several of the initiatives introduced  under the Economic Transforma tion Agenda will continue under 
the current Government.  Measures  such as the $160 million Venture Investment Fund, the Capital 
Markets Development Taskforce, and free trade agreements with key nations continue to play a role.  
Other initiatives, such as investments in broadba nd networks and road infrastructure, are being 
expanded. 
 
Further detail on the policy measures developed as part of ETA are archived on the Ministry of 
Economic Development website at:  http: //www.med.govt.nz/templates/StandardSummary____ 
22996.aspx.  Progress reports are available at:  http://www.med.govt.nz/templates/ 
ContentTopicSummary____23388.aspx.  WT/TPR/M/216/Add.1 
 Page 33 
 
 
   
Q1-2 It appears that the "Economic Transformati on Agenda" policy was put into effect between the 
years 2006~8.  If so, is there another policy/program in the pipelines?  If yes, could NZ explain the salient features of the new policy/program?  Answer:
 
As discussed in the Government Report, the current  Government's activity is concentrated in the 
following areas:  1) Improving productivity and valu e for money in the public sector; 
 2) Lowering personal taxes, making regulation simpler and more transparent, and 
enhancing competition policy; 
 3) Increasing investment in infrastructure including road and electri city networks and 
broadband; 
 4) Lifting education standards and workers’ skills through the introduction of National 
Standards in literacy and numeracy, suppor t for apprenticeships, and voluntary 
bonding schemes;  and 
 5) Reforming the 1991 Resource Management  Act (RMA) to streamline the consent 
process for new infrastructure and construction. 
 Ministers are presently consideri ng further options for lifting pr oductivity and economic growth 
beyond these 'foundation' measures. 
 
Q2 According to the Government report, si nce taking office in Nov. 2008, the present 
Government has established 5 main priorities, and "action is under way".   Q2-1 Could NZ further elaborate on the "action under way?"  
 
Answer:
 
The New Zealand government has implemented a number of measures in its 5 main priority areas: 
 1. Improved Public Service: Clear messages have been sent to the public service that there is a 
strong government focus on delivering high-quality ser vices in a time of limited resources.  The 
May 2009 budget provided a $3 billion boost to heal th services over four years and 600 more police 
and 246 more probation workers to improve public safety.   
 
2. Lowering Personal Taxes:  $1 billion worth of tax cuts were legislated for that took effect on 1 April, affecting more than 1.5 million Ne w Zealand workers and making a New Zealander on the 
average wage $18 a week better off.   
 
3. Increasing Investment in Infrastructure: The May 2009 budget delivered a multi-billion dollar 
boost to infrastructure investment.  This included: an extra $1 billion over three years for the state 
highway network;  $323.3 million on  home insulation and clean hea ting;  and $124.5 million for the 
construction and upgrade of state houses.     
4. Lifting Education Standards and Workers' Skills:  The 2009 budget provided $1.68 billion 
spending on education to raise student achievement,  $1 billion of which was new spending.  This 
funding will go towards building new schools, increasing students’ literacy and numeracy skills, and 
expanding the Early Childhood Education Scheme.  Th e February Job Summit led to the introduction 
of a nine day fortnight to retain jobs in the s hort term by reducing wages, while up-skilling workers in 
the long term.  The time that industry training  organisations are funded for industry trainees who 
have lost their job has been extended from 6 weeks to 12 weeks.  Other initiatives to support 
apprentices and training are ongoing. 
 WT/TPR/M/216/Add.1 
Page 34  
 
  5. Reform of the Resource M anagement Act has been initiated and the government is also 
looking at other areas that may constitute obsta cles to economic growth, such as the Overseas 
Investment Act, the Building Act an d electricity market regulation. 
 
Q2-2 Also, could NZ further elaborate on the "Job Summit convened by the PM in February, 
2009?"  What were the issues discussed, and what we re the conclusions that were derived?  Is the 
government contemplating any follow-up policy m easure as a consequence of the "Job Summit"? 
 
Answer:
 
The Job Summit held in February contributed va luable ideas for preserving jobs through the present 
economic crisis and creating best possible conditions  for business to step up as economic conditions 
improve.  There was positive engagement from appro ximately two hundred of New Zealand's top 
business, government, and community and union leaders.  During the Summit, delegates were divided into six work streams:  core workplace and employment 
issues;  workers skills and transition; local and regional government, and Maori economy;  helping 
firms survive;  business investment;  and firm funding.  From these groups a wide-range of ideas to solve the expected rise in unemployment emerged.  Some 
of these have already been taken  forward by the government: 
- A nine day fortnight - a job support scheme was introduced for firms with more than 
100 employees in March and extended to cover firms with more than 50 employees in 
April. 
- Enhance utilisation of Iwi assets – the Maor i Trustee Amendment Act was enacted in 
May 2009; proposals for improving Systems for Valuation and Rating of Maori Land 
are being finalised; and a survey of  600 Marae around the country to gather 
information on marae infrastructure requirements. 
- Reduce regulatory compliance costs and impediments – a programme of reviews has 
been launched (see details  on Treasury's website http://www.treasury.govt.nz/ 
economy/regulation/programme);  a Regul atory Improvement Bill has been 
introduced; and a Regulatory Responsibility Task Force set up. 
- Nationwide cycleway – Advisory Group established and $50 million of Government 
funding allocated over the next three years. 
 The May 2009 budget delivered a multi-billion dollar boos t to infrastructure investment and spending 
on public services.  An extra $1 billion will be sp ent over three years on the state highway network; 
$323.3 million will be spent on home insulation an d a clean heating campaign; and $1.68 billion will 
be spent on education to raise student achievemen t.  These initiatives will increase employment and 
create work for businesses throughout the regions.  
Q3 Paragraphs 13 through 16 describe the inbound FDI regime in place in NZ.  For this issue, we 
would appreciate detailed responses to the following: 
 Q3-1 Para 13 and 14 refers to NZ's 'investment screening regime'.  Could NZ explain if this 
'investment screening regime' is in fact a "national in terest test" or "national security test" in effect in 
other countries?  If different, could NZ detail the diffe rence of this regime to  that of Australia, its 
neighbour, for example? 
 
Answer:
 
New Zealand screens investments in significant business assets, sensitive land and fishing quota.  A full description of the screening regime can be found in the Overseas Investment Act 2005 and the 
Fisheries Act 1996.  However in broad terms, fo r investments in significant business assets the 
investor must show that they have business exper ience and acumen, financial commitment to the  WT/TPR/M/216/Add.1 
 Page 35 
 
 
  investment, that they are of good character, and is not a person who would not be eligible for a permit 
or exemption under New Zealand's immigration legislation ("investor test").  For investments in sensitive land, the investor must also show that the investment will benefit New Zealand based on a number of factors set out in the Overseas Invest ment Act 2005.  For investments in fishing quota the 
investor must, in addition to meeting the "investor  test", show that the investment will be in the 
national interest, based on a number of fa ctors set out in the Fisheries Act 1996. 
 
Australia would be better placed to pr ovide a description of its screening regime.  
 
Q3-2 Para 14 states that "Sensitive land" includ es "non-urban land exceeding 5 hectares, any land 
on most off-shore islands, any land containing foreshore or seabed, specified islands or land including 
or adjoining reserves, parks, historic or heritage areas in excess of 0.4 hectares, and land adjoining the 
foreshore in excess of 0.2 hectares".  The definiti on of "sensitive land" in para 14 seems to be 
non-exhaustive, and therefore one has to wonder if th ere is any land other than in urban areas that are 
not subject to screening by the authorities.  What is NZ's view on this comment? 
 
Answer:
 
The types of land considered sensitive are clearly out lined in the Overseas Investment Act 2005.  The 
description in paragraph 14 is a general summary only.  In relation to non-urban land, it is 
considered sensitive if it exceeds 5 hectares. 
 Q3-3 Para 16 states that in March 2008, the Gove rnment introduced a new cr iteria with regards to 
"strategic infrastructure assets".  This could be cons trued to be an extra layer of screening that the NZ 
government has unilaterally introduced to its inbound FDI regime.  In this context, what assurances do 
foreign investors in NZ have that such occurrences  (i.e., the Government un ilaterally introducing new 
restrictions post-factum) will not happen again in the future?  
 
Answer:
 
In the current review of the Overseas Investment Ac t the Government is considering whether it is 
appropriate to retain the ability to add to the factors considered when assessing the benefit of an 
investment in sensitive land.  Decisions on this issu e will be announced when the review is completed 
(approximately July 2009). 
 
Q4-1 In regards to the stimul us package announced by the new Government, could NZ further 
elaborate on the details of the package?  (Curren tly it is only referred in general terms such as 
'housing, transport, and education sectors')  Answer:
 
The projects that will be fast-tracked under this programme have been cho sen because they are of 
high-quality, they will make a lasting contributio n to New Zealand's economy, and they are ready to 
be implemented.  They will lead to increased em ployment and work for business, and their benefits 
will flow through communities.    
The $483.7 million worth of publicly funded projects to contribute to the Government's stimulus 
programme includes: 
- Education: $216.7 million of spending,  including five new schools, school 
refurbishments and maintenance and IC T infrastructure improvements. 
- Transport - $142.5 million of spending, s panning five large state highway projects 
and a programme of smaller, regional  roading improvement projects. 
- Housing - $124.5 million of spending, a llowing Housing New Zealand to upgrade 
and renovate 10,000 more state houses, and build 69 new state houses over the next six months. 
 WT/TPR/M/216/Add.1 
Page 36  
 
  About $100 million worth of accelerated projects will  start before June 30 this year.  $115 million of 
spending on new carriages and locomotives for Ki wiRail has already been approved.    
 The May 2009 budget delivered a multi-billion dolla r boost to infrastructure investment.  This 
included:  $1 billion over three years for the state highway network;  $323.3 million on home 
insulation and clean heating;  an d $1.68 billion on education.  Th e spending announced in February 
is included in the 2009 budget.  A small unit within Treasury to manage the next st ages of the infrastructure programme has been 
established.  This unit will improve the way public sector agencies manage their existing 
infrastructure assets and lead to a stronger forward planning on infrastructure needs.  A National 
Infrastructure Advisory Board, to include rep resentatives from the private sector and local 
government, will also be set up to advise the infras tructure unit and the Infrastructure Minister.  The 
infrastructure unit and the adviso ry board will develop a national in frastructure plan by the end of 
this year.  The plan will be updated every three years. 
 
Q4-2 Could NZ confirm that there are no 'potentially  trade restricting or distorting' measures in the 
stimulus package referred to in para 28, and the assistance to the financial sector detailed in paras 25 
through 27?  
Answer:
 
New Zealand reported the measures referred to in paragraphs 25-27 (Retail Deposit Guarantee 
Scheme;  Wholesale Funding Guarantee Facility ;  RBNZ temporary additional measures to enable 
banks to access liquidity;  temporary change to th e mandate of the NZECO to provide short-term 
trade credit insurance at market rates on a temporary basis), and in paragrap h 28 (stimulus package 
of NZ$500 million for publicly funded housing, tran sport and education projects), to the WTO in 
March 2009.  These were included in the Dir ector-General's March Report to the TPRB on the 
Financial and Economic Crisis and Trade-Related Developments. 
 None of these measures are potentially trade restricting or distorting.   
 These measures were taken in order to guarantee the continued functioning of financial institutions, 
access to regular foreign markets, and the availa bility of trade credit necessary to ensure the 
continued flow of trade in goods and services, in th e context of the current global financial crisis. 
 Details of New Zealand's stimulus package for publicly-funded projects in housing, transport and 
education have recently become available followi ng the 2009/2010 Budget announcement.  These 
projects, like all publicly-funded projects, will be  implemented in a manner consistent with 
New Zealand's commitment to international trade rul es that seek to avoid distortion or restriction of 
trade.  Fair and free-flowing global tr ade is vital to New Zealand.   
 New Zealand's commitment to open trade and its eschewing of trade protectionism, particularly 
during such a difficult time for the multilateral tradi ng system, meant that we were pleased to recently 
co-sponsor the 'standstill' proposal  communicated in WT/GC/W/604 (endorsed by the Republic of 
Korea).  New Zealand fully endorses the message of the G20's November and April declarations, and 
considers all WTO Members should also. 
 
Q5 In regards to the export of dairy and meat (t wo of NZ's key exports),  what are the greatest 
barriers faced by NZ exporters in accessing the da iry and meat markets of Japan, China, the US, and 
the EC?    WT/TPR/M/216/Add.1 
 Page 37 
 
 
  Answer:  
Agriculture products (including dairy and meat) often face significant barriers in international 
markets in terms of high tariffs, use of tar iff quotas and safeguard measures.  In some 
markets technical and SPS requirements also act as significant unjustified barriers for trade in 
agricultural products.  
 
For this reason New Zealand places a strong emphas is on achieving a successful conclusion to the 
Doha Round as soon as possible.  New Zealand strongly supports members taking actions which 
lower or removes barriers for trade in agricultural products.  New Ze aland also welcomes and shares 
the commitment made by a large number of countri es to resist imposing protectionist measures as a 
response to the current global economic downturn.  
Q6-1 Please elaborate on the proposed new Trade (Safeguard measures) bill under consideration in 
the NZ Parliament (would appreciate greater specific ity, more than the brief description in para 41, 
pg 47 of the Secretariat report). 
 
Answer:
 
Paragraph 41 of the Secretariat's report outlines the main changes propo sed in the Bill.  Authorising 
the Minister of Commerce to impose a provisional safeguard duty is intended to allow for the quick 
imposition of a provisional duty, if the relevant criteria are met, and recognises that the proposed 
extension of the investigation timeframe from 30 to 75 or 85 working days may require the imposition 
of a provisional duty to protect a domestic indust ry while an investigation is being completed.   
 Authorising the Minister to impose a final safegu ard duty is intended to provide a quicker and more 
efficient means of imposing a safeguard measure in  the form of a duty than the present system which 
requires Cabinet approval and an Order-in-Counc il process to increase the normal tariff.  The 
inclusion of criteria for determining whether a safe guard measure is in the public interest is intended 
to bring greater transparency and certainty to th is process as no such guidelines exist under the 
present safeguard regime.    The undertaking of safeguard investigations by th e Ministry of Economic Development rather than by 
independent Temporary Safeguar d Authorities is intended to more fully utilise the skills and 
experience of the Ministry, which conducts dumping and subsidy investigations, in the undertaking of 
safeguard investigations.    Extending the timeframe for the completion of an inve stigation is intended to ensure there is sufficient 
time available to cover all of the issues and comple te the level of analysis that WTO jurisprudence 
indicates is required in an investigation.  
Q6-2 (Follow-up to 6-1:) How will the changes "ensure NZ's SG regime promotes efficient, 
transparent, and objective investig ative and decision-making processes?"  
 
Answer:
 
This is covered by the explanations gi ven in response to the above question. 
 
Q6-3 (Follow-up to 6-1:) What propelled the need for this change in legislation? 
 
Answer:  
The primary impetus for the review was the recogni tion that the 30 working day timeframe for the 
completion of an investigation under the present regime  was unlikely to provide sufficient time.  The 
other changes proposed in the review largely arose out of issues identified during the review process. 
 WT/TPR/M/216/Add.1 
Page 38  
 
  Q7-1 Could NZ elaborate on the ROO that is impl emented in association with the DFQF that NZ 
provides for LDCs?  In particular, fo r items of export interest of LDCs? 
 
Answer:
 
New Zealand's ROO regime for LDCs requires the LDC to meet an added value threshold of 50% 
based on an ex-factory cost calculation.  The ex porting LDC may cumulate this added value threshold 
from inputs from other LDCs.  This criteria is set  for all product lines regardless of any specific LDC 
export interest. 
 
Q7-2 Has NZ received any request from LDCs to change its existing ROO in effect in association 
with its DFQF regime?  If so, what was NZ's response? 
 
Answer:  
To our knowledge no formal request has been  made from LDCs to  change this regime. 
  Q8 The CERs concluded and implemented under th e aegis of the "Australia/NZ Closer Economic 
Relationship" are quite extensive;  paragraphs 82~84 detail the numer ous sub-agreements in force or 
soon to be implemented.  Q8-1 In this context, is the Australia/NZ exam ple the model through which NZ envisions closer 
regional ties?  That is, does NZ envision adopti ng arrangements similar to the TTMRA (1998), MoUs 
of 1998 and 2000 for business law, etc., as future st eps in its bilateral relations with Thailand, 
P4 countries, China, and ASEAN countries in due  course now that FTAs have been concluded? 
 
Answer:
 
The relationship between Australia and New Zeal and has special qualities which extend well beyond 
the trade and economic sphere.  The close historical and political ties have allowed the two countries 
to move towards deep economic in tegration within the framework provided by the CER agreement. 
New Zealand would welcome a trading relationship w ith other partners, involving agreements with a 
comparable depth of commitments, if this could be  done on a reciprocal basis.  Additionally it should 
be noted that other countries can acced e to CER under Article 24 of ANZCERTA. 
 Q8-2 In this relation, are there talks to in troduce MRAs (similar in scope to TTMRA) with 
Thailand and/or China?  
Answer:
 
The TTMRA is a comprehensive equivalence arrange ment, covering all goods and occupations with 
very few exceptions.  Such an arrangement is onl y possible where there are very similar regulatory 
systems in each party.  We have no plans at present for this type of arrangement with any other 
country. 
 
Q8-3 Only recently have NZ and Australia begun work on an investment protocol.  Could NZ 
further elaborate on the issues being discussed? W ill it include investor-state dispute settlement 
procedures?  If not, why not? 
 
Answer:  
New Zealand and Australia have been negotiating an  Investment Protocol to CER since 2005.  The 
issues being discussed include core investment disciplines and obligations, investor protection and 
market access.  These matters, incl uding the question of whether the Protocol will include investor-
state dispute settlement procedures, are still under negotiation.   WT/TPR/M/216/Add.1 
 Page 39 
 
 
  Q9-1 Regarding the China-NZ FTA in para 87~ 88, could NZ clarify whether the Investment 
chapter in the China-NZ FTA inco rporates investor-state dispute settlement procedures?  If so, could 
NZ elaborate on the main features of those provisions?   
Answer:
 
The NZ-China FTA does contain investor-state disput e settlement procedures, which provide that if 
the dispute can not be settled within six months  through consultation and negotiation, and unless the 
parties to the agreement agree otherwise, inv estors can submit issues for conciliation or 
arbitration by ICSID or for arbitration under the rules of UNCITRAL.  There are requirements for 
notice to be provided; a requirement that domestic re medies have to be exhauste d prior to the dispute 
being submitted to international ar bitration; and provisions that cl arify the scope of expropriation.  
There are also a range of other related safeguards .  See www.chinafta.govt.nz for more details, in 
particular pp. 36-7 of the National Interest Analysis. 
 
Q9-2 (Follow up to 9-1) If the investor-state dis pute settlement procedures were not included, could 
NZ clarify why it was not so?  Are there pl ans to incorporate them in the future? 
 
Answer:  
N/A. 
 
Q9-3 Could NZ elaborate on what it means by "Services commitments made in the FTA are 
substantial, and cover modes 1~4"  in para 88?  Was the substan tial commitments made by NZ or 
China or both?  
Answer:
 
Both NZ and China made substantial services comm itments in the FTA, including by China on:  
computer and related services, services related to m anagement consulting, education, environmental 
services, air and transport services and NZ on:  ot her education services, en vironmental services, 
computer services and construction services. NZ and Chi na also each committed to facilitate the entry 
of businesses people in those services sectors in which they made commitments.  For more 
information see www.chinafta.govt.nz for more deta ils, in particular p.37-42 of the Guide to the 
Agreement. 
 
Q9-4 (Follow up to 9-3) Could NZ elaborat e on areas in which both China and NZ committed 
above and beyond their respective GATS commitments?  
Answer:
 
Please see the above answer.  
Q10-1 Regarding the ASEAN-Australia-NZ FTA, Pa ra 89 states that "There are new GATS-plus 
commitments in services sectors in areas of interest  to NZ."  Could NZ elaborate which are these 
areas and to what extent these new commitment are GATS-plus?  Answer:
 
The ASEAN/NZ/Australia FTA contains GATS-plus services commitments in a number of sectors 
including, in terms of commitments by ASEAN c ountries:  various business services in particular, 
computer and related services, construction, e ducation and environmental services.  See 
www.asean.fta.govt.nz for more details, in partic ular pp. 4-7 of the Key Outcomes of the FTA 
document.  
Q10-2 Para 89 also states that "there is an inv estment chapter which adds new protection for NZ 
investors and investments in the region."  Could NZ el aborate what these 'new protection' are?  Is the 
investor-state dispute settlement proce dure one of such 'new protections'? WT/TPR/M/216/Add.1 
Page 40  
 
   
Answer:
 
The ASEAN/Australia/NZ FTA contains a number of pr ovisions providing protection for investments, 
of which recourse to binding investor state dispute settle ment in certain defined circumstances is one.  
See www.asean.fta.govt.nz for more details, in par ticular p. 8 of the Key Outcomes of the FTA 
Document. 
  CHILE
 
 Q1 As the Secretariat report rightly states, New Ze aland ranks high in terms of the quality of its 
domestic regulatory regimes and institutions.  Howe ver, measures are still being adopted with a view 
to further improvement in this area, in particular  to identify and remove inefficient and superfluous 
regulation.  We would like to know in greater deta il the objectives and parameters of this policy of 
further improving the regulatory framework. 
 
Answer:
 
The New Zealand Government's regulatory reform progr amme aims to identify and remove inefficient 
and superfluous regulation through:  
- A programme of higher level microeconomic reforms and full regulatory reviews as 
set out in the table below: 
 
Review is underway or in implementation 
stage Review in 2009 (most already commenced) Proposed review in 2010 
Climate Change Response Act 
Raw milk regulations 
Resource Management Act 
(RMA) (Phase 1) Building Act 
Election commitments on Employment Relations 
Act amendments 
Foreshore and Seabed Act 
Holidays Act 
Overseas Investment Act and Regulations 
Resource Management Ac t (RMA) (Phase 2) 
Telecommunications Act 
Weather Tight Homes Resolution Services Act 
Electricity institutional arrangements Food Safety Rule review 
Also work on Hazardous Substances and New 
Organisms Act (HSNO) Financial Market Regulation 
Local government regulations 
Occupational licensing 
 
- Solutions for discrete regulatory issues.  Th ese are smaller issues that do not require 
full reviews but cumulatively do impose cost or unnecessary duplication on 
businesses.  The New Zealand government has  agreed to have a regular legislative 
vehicle for addressing these issues. 
 
Q2 What type of criteria are applied in responding positively to a foreign investment application?  
Can a refusal of application be challenged before a higher body? 
 
Answer:  
The factors considered when a ssessing investments in significant bus iness assets, sensitive land and 
fishing quota are set out in the Overseas Investment Act 2005 and the Fisheries Act 1996. 
 Q3 Paragraph 37 mentions the s unset review, but does not specify  the maximum time-periods for 
the imposition of measures once the review has been  initiated.  What would be the maximum period  WT/TPR/M/216/Add.1 
 Page 41 
 
 
  for imposing measures in such cases?  Is there a maximum number of times that a new review can be 
initiated?  
Answer:
 
Anti-dumping or countervailing duty remains in place pending the outcome of the review.  Under the 
Dumping and Countervailing Duties Act 1988 a review must be completed within 180 days of its 
initiation.  If the review finds that the duty should re main in place, a reassessment of the rate of the 
duty is initiated immediately following the comple tion of the review and a new rate of duty is 
determined based on information gathered in the re view.  The "sunset" expiry date of the duty then 
becomes 5 years from the date the new rate of duty was determined.  If the review finds the duty is no 
longer necessary, a recommendation is made to the Mi nister of Commerce to terminate the duty.  In 
this situation, the duty would normally cease from the date the Minister makes a decision to terminate 
it, but the Minister can retrospectively terminate the duty if this is warranted by the circumstances of 
the case. 
 Q4-1 Paragraph 96 states that "New Zealand does not appear to provide direct subsidies for any 
sector-specific economic activities."  What does this m ean?  Are subsidies provided or not?  Is there a 
register of "possible subsidies" provided by New Zealand?  Does the New Z ealand Government have 
any information on this respect?  
Answer
 
For more detail on the agricultural support provid ed by the New Zealand Government, please see 
New Zealand's most recent domestic support not ification provided to the WTO Committee on 
Agriculture WT/AG/NZL/52.  All agriculture suppor t provided by New Zealand is outlined in our 
ongoing domestic support notifications.  We can confirm that, as per New Zealand's notifications, all 
domestic support provided by New Zealand is Green Box consistent and covers, for example, 
programmes relating to pest and disease control,  inspection services, extension and advisory services 
and payments for relief from natural disasters.  Consistent with Annex 2 of the Agreement on 
Agriculture, such support meets the fundamental requi rement that it has no, or at most a minimal, 
trade-distorting effect or  effect on production.  
 
Q4-2 The same paragraph also states that "[a]cco rding to the OECD, market price supports appear 
to be maintained for eggs and poultry."  Once ag ain:  "appear" to be maintained?  Are they 
maintained, or is this simply a hypothesis?  Wh at does the New Zealand Government say in this 
respect?  
Answer:
 
As a result of a blanket import ban on uncooked poul try and eggs which has been imposed to protect 
local poultry and some native bird species from exo tic diseases and pests, domestic prices tend to be 
higher then international prices for poultry and eg gs.  The resulting "price supports" are therefore by 
accident rather than design as the intention of th e policy is to protect poultry and some native birds 
from exotic diseases and pests not to provide market support. 
 WT/TPR/M/216/Add.1 
Page 42  
 
  ECUADOR
 
 
Q1 Paragraph 10 states that prior to Parliamentary examination of any preferential trade agreement a National Interest Analysis is conducted on the effects of such an  agreement and that it 
provides a good basis for public consultations during Parliament's consideration of the agreement. 
What elements are taken into consideration in preparing the National Interest Analysis? 
 
Answer:
 
A National Interest Analysis (NIA) is a summary of why becoming party to a treaty is in New Zealand's national interest.  NIAs are a key work ing document used by Parliamentary Select 
Committees to scrutinise New Zealand treaty actions. 
 The NIA considers the following elements: 
- Reasons for New Zealand Becoming a Party to the Treaty; 
- Advantages and Disadvantage to New Zealand of the Treaties Entering into Force; 
- Legal Obligations which would be imposed  on New Zealand by the Treaty Action; 
- Measures which the Government Could or  Should Adopt to Implement the Treaty 
Actions; 
- Economic, Social, Cultural and Environmental Costs and Effects of the Treaty; 
- Costs to New Zealand of Compliance with the Treaty;  and 
- Subsequent Protocols and/or Amendments to the Treaties and their Likely Effects. 
 
New Zealand's trade related NIAs are available on the New Zealand Ministry of Foreign Affairs and 
Trade's website at  www.mfat.govt.nz.  
 Q2 According to paragraph 4, imports of animal and plant products are regulated by 
New Zealand's relatively strict sanitary and phyt osanitary laws;  in the area of food safety, 
institutional changes have been undertaken and provis ions are being reviewed.  Ecuador would like to 
know in detail, with particular regard to ba nanas, mangos, pineapples and vegetables, as these 
products accounted for more than 97% of total expor ts to New Zealand in 2008, the type of sanitary 
and phytosanitary provisions that are being revised, on the basis of the principle of transparency laid 
down in the WTO. 
 
Answer:
 
At this stage, there is no specific intention to  revise phytosanitary provisions for mangos, pineapple 
and vegetables imported into New Zealand.  A re cent assessment has been undertaken by MAF 
Biosecurity New Zealand (MAFBNZ) on organisms asso ciated with imported bananas.  The findings 
of this assessment are presently being reviewed.  For administration purposes, New Zealand requires 
all persons/companies who import food into New Zealand to be listed with the New Zealand Food 
Safety Authority.  Additionally, food importers are required to ensure that the food they import for sale in New Zealand meets the domestic standards  for safe and suitable food.  Importers can 
demonstrate this through obtain ing appropriate assurance documents  or records from their supplier .  
Further information on the New Zealand import system can be found at 
http://www.nzfsa.govt.nz/i mported-food/index.htm. 
 
Q3 According to paragraph 29, "reference 99" concessions may be granted for various reasons. 
Could New Zealand specify the reasons for whic h "reference 99" concessions may be granted? 
 Answer:
 
The reasons for which Reference 99 concessions may be granted are mentioned in the text of para 29, 
namely "In addition to the general concessions for products not manufactured or produced in 
New Zealand, specific concessions ma y be approved for:  shortfa lls of inputs to manufacturing; 
woven fabrics containing wool for use in the m anufacture of apparel; and certain capital equipment".  WT/TPR/M/216/Add.1 
 Page 43 
 
 
  Q4 Paragraph 55 states that on receipt of a request from an exporting country, the Ministry of 
Agriculture and Forestry Biosecurity New Zealand (M AFBNZ) works with that country bilaterally to 
establish a country- and/or commodity-specific impor t health standard that mitigates the risk 
associated with importing that product.  
Q4-1 Could New Zealand provide further inform ation on how the above-mentioned body works 
bilaterally with the country concerned to establish a health standard that mitig ates the risk associated 
with importing a given product?  
Answer:
 
The development of an HIS for an imported commod ity is typically comprised of two distinct 
activities.  In the first instance, a risk assessmen t is undertaken to identify biosecurity hazards 
associated with the commodity and/or pathway.  During this assessment, each identified hazard 
organism is assessed to determine what, if any, phyto sanitary measures may need to be considered to 
mitigate the respective ri sks.  Dependent upon the nature and comp lexity of the risk assessment, the 
exporting country may be requested to provide co mments on a draft of the document.  Upon the 
completion of the risk assessment, an Import He alth Standard (IHS) is developed.  The IHS 
incorporates as appropriate, mitigatio n measures for the identified bio security risks.  Prior to the 
issuance of the IHS, the exporting country and ot her interested stakeholders are provided an 
opportunity to comment on the proposed import measures. 
 
Q4-2 Are there any requirements to be met by  the exporting country in submitting the request? 
 
Answer:  
Formal requests for new import health standards ar e to be made via the New Zealand Ministry of 
Foreign Affairs and Trade.  If several requests are received from one exporting country, each 
request must be prioritised.  Upon receipt of the request(s) by MAFBNZ, pest/production information 
may be sought as required.  Note - MAFBNZ operat es a biennial IHS prioritisation/work programme. 
  AUSTRALIA
 
 Q1 The Secretariat's Report (paragraph 4, page 3)  notes that the slowdown in economic growth in 
New Zealand has been compounded by the recent gl obal economic crisis.  Have any changes have 
been made to New Zealand's domestic policy settings  or trade policies to help local exporters or 
industry cope with the economic downturn?  Answer:
 
New Zealand has responded to the global economic crisis with both monetary and fiscal policy.  
New Zealand was in a relatively strong position to respond as there was considerable scope to loosen 
monetary policy and the government’s gross debt was less than 20% of GDP at 30 June 2008, following more than a decade of fiscal surpluses.  
On 4 February, the New Zealand Government unveiled a small-business relief package to assist small 
and medium-sized enterprises (SMEs).  The package has five parts: a suite of 11 tax changes costing 
$480 million;  an expansion to the export credit sch eme;  extended jurisdiction for the Disputes 
Tribunal to reduce the time SMEs are tied up in district court processes;  expansion of business 
advice services;  and a prompt-payment requirement fo r government agencies.  The package is aimed 
at urgently improving the business environment by  reducing the impact of taxes on firms' cash-flows, 
improving firms' access to credit, and reducing business compliance costs.  The Job Summit held in February contributed va luable ideas for preserving jobs through the present 
economic crisis and creating best possible conditions  for business to step up as economic conditions WT/TPR/M/216/Add.1 
Page 44  
 
  improve.  Some ideas that emerged from Job Summit included: a nine-day fortnight;  the reduction of 
regulatory compliance costs and impediments and a f reeze on rule-making;  and revised procurement 
guidelines to prevent discrimination against smaller dom estic firms.  Banks have issued a statement of 
commitment to provide capital to New Zealand firms.  
Q2 Australia notes that the New Zealand Governme nt is currently reviewing its aid policies.  
How are New Zealand's aid policies (which are mostly aimed at the Pacific region) assisting the recipient countries' trading capacities?  
Answer:
 
New Zealand is supporting our donor partners, incl uding those in the Pacific, to increase their 
capacity to trade through a range of bilateral, regional and multilateral activities. 
 NZAID supports measures that assist developing coun tries to formulate appropriate trade policy and 
implement it effectively.  This includes activities to  facilitate trade such as efforts to streamline 
customs procedures and to enable developing country producers (particularly in the agricultural and 
food sectors) to meet quarantine requirements in export markets.  NZAID also supports a range of programmes to strengthen the ability of producers to supply and link 
to markets.  These can include efforts to impr ove the competitiveness of  businesses and farms in 
partner countries, their ability to add-value to their products, to access market information, to meet 
importers' and customers' demands regarding quality and consistency of supply;  and to promote 
trade.  Recognising that the general environmen t for business in our partner countries can constrain 
the ability of local businesses to grow and be competiti ve, as can the quality of infrastructure, NZAID 
also works to address these issues.   
More information including examples can be found at www.nzaid.govt.nz/what-we-do/trade-and-
development.html.  
Q3 The Secretariat's Report (paragraph 24, page 40) notes that, although this has not been the 
case during the period under review, differences be tween bound and applied tariff rates may provide 
the New Zealand Government with scope to raise a pplied tariffs, especially in sensitive sectors.  How 
does the New Zealand Government plan to address the average gap of 9.1% between applied and 
bound MFN rates?  
Answer:
 
New Zealand's existing bound rates were agreed in the Uruguay Round of multilateral trade 
negotiations.  The WTO Doha Development Agenda of  multilateral trade negotiations is the forum 
that will provide for further reduc tions of New Zealand's bound tariffs. 
  SWITZERLAND
 
 Q1 In paras 2 and 6, the Secretariat's report indicates that low productivity is an important 
structural challenge for New Zealand's economy.  Could the New Zealand authorities indicate the specific measures, if any, they are taking to tackle this problem in order to ensure that the goal of 
achieving higher incomes for the population can be reached ?   Answer:
 
The New Zealand government accepts that increases in productivity are needed, with a focus on 
international competitiveness, to  permanently raise New Zealanders'  living standards and create jobs. 
  WT/TPR/M/216/Add.1 
 Page 45 
 
 
  While fiscal management and getting through the curren t global financial and ec onomic crisis is the 
major current focus of th e Government it is also taking initial steps in a longer-term programme to 
raise productivity.  The tax cuts the Government intro duced on 1 April 2009 will rewar d hard work, and help encourage 
people to invest in their own skills to earn and keep more of the money they earn. 
 Looking forward, government initiatives to lift productivity fall into four broad areas: 
- Increasing the government's investment in much-needed infrastructure  
- Removing roadblocks to growth by improving the regulatory environment under 
which businesses operate  
- Lifting the literacy and numeracy sk ills of young people, and  
- Improving the productivity of the public sector.  
 The Government is committed to reducing unnecessary compliance costs.  It has initiated a number of 
first-round changes to the Resource Management Act (1991) and is actively reviewing the Overseas 
Investment Act (2005), the Building Act (2004) and electricity market regulation.  These regulatory reviews, amongst others, will result in changes to legislation that help lighten the load the 
Government places on businesses.  The Government is focused on addressing the problem  of educational underachievement.  It has 
legislated for national standards in literacy and numeracy and is working with schools to implement 
them.  Budget 2009 provides funding  specifically to help students m eet national standards, as well as 
funding to build new schools, modern ize existing schools and expand capacity. 
 The Government also has an ongoing focus on value for money in the public sector.  It will shift 
resources from the back office to the front line an d find ways to deliver better, smarter public services 
for less. 
 
Q2 With respect to paras 11, 12 (registration and documentation) and 17 of the Secretariat's 
report, could the New Zealand authorities provide answers to the following questions:  Does NZCS 
provide for a Web-based platform that enables impor ters and exporters to tr ansmit their import and/or 
export declarations directly to the customs system without interaction of a customs broker ?  If NZCS 
provides for this type of e-Government service, how does the system work: does the importer/exporter 
fill declarations online or does the trader have  the possibility to send import/export declarations 
generated by its system directly via the Web to the customs system ?   Answer:
 
Yes, NZCS provides this type of e-Government service.  Importers/Exporters can choose to submit 
their declarations using either a web based platform  or by installing appropriate EDI software on its 
system.  An importer or exporter that chooses to use the web based platform is able to complete the 
declaration online.  The data is then transmitted through the EDI gateway to the Customs system.   
 
Q3 In relation to para. 66 of the Secretariat' s report:  According to para. 63, New Zealand's 
procurement regime aims at providing "full and fa ir opportunity for domestic suppliers" and in light 
of para. 72, New Zealand is also committed not to discriminate between suppliers of goods and 
services in New Zealand, Australia, Brunei Darussalam, Chile, and Singapore.  Under these circumstances, Switzerland warmly welcomes the decision of the Members of the GPA of the end of 
2008 to grant New Zealand the observer status in the WTO-Committee of government procurement.  
What are the prospects of New Zealand joining the GPA in light of the advantages which would result 
for a sustainable growth of New Zealand's economy from a membership in the GPA and for 
New Zealand's further integration in the world economy ?  WT/TPR/M/216/Add.1 
Page 46  
 
  Answer:
 
New Zealand became an observer on the GPA committee without commitment as to GPA membership.  
This matter is however under continuing review in the light of domestic and international developments.  
 Q4 In para. 103, the Secretariat's report indicates th at Zespri, a state-trading enterprise, i.e. the 
sole kiwifruit exporter in New Zealand, must fully  comply with the Commerce Act which aims to 
"promote competition in markets for the long term be nefit of consumers within New Zealand".  Could 
the New Zealand authorities explain how in practice they can ensure that a state-trading enterprise 
such as Zespri, which has an export monopoly for kiwi fruit, can be forced to behave as if competitive 
conditions existed in the kiwifruit export market?  In  particular, how do the authorities determine that 
the level of the purchase price by Zespri of kiwifr uit from domestic farmers is consistent with the 
price that would be obtained if compe titive conditions existed on that market?  
 
Answer:
 
The New Zealand competition law concerns itself w ith competition in markets in the territory of 
New Zealand.  Within New Zealand there are no restr ictions on either the buying of kiwifruit from 
growers or the wholesale marketing of kiwifruit to  retailers for sale and consumption on the domestic 
market.    The special rights ZESPRI enjoys relating to the ex port of kiwifruit also have consequences on the 
buying side.  ZESPRI buys kiwifruit from growers and arguably enjoys a high degree of market power 
in that market.   As far as pricing of kiwifruit pu rchased from growers is concerned, it is important to 
note that ZESPRI is a company owned and controlle d by grower suppliers and the Board of directors 
is elected directly by the grower shareholders.  Any measure of monopsony enjoyed by ZESPRI is 
counterveiled by the fact that the company is owned by the growers.  There is no incentive on the 
company to underprice or overprice  fruit purchased from growers or  marketed on behalf of growers.  
In that sense the price paid to growers is a competitive price but it embodies part of what would otherwise be the trading profit of the company minus  any funds withheld for capital investment.  The 
company's policies in this regard are subject to approval by shareholders. 
 Note that ZESPRI is not the sole kiwifruit expor ter in New Zealand as exports to Australia are not 
regulated.   
  HONG KONG CHINA
 
 Q1 We note from the Secretariat Report that under the Australia and New Zealand Closer 
Economic Relations Trade Agreement (ANZCERT A), anti-dumping actions may not be taken on 
goods covered by the Agreement.  Further, no safe guard measures are permitted for goods under the 
ANZCERTA and the New Zealand-Singapore Closer Economic Partnership Agreement.  We are 
interested to know New Zealand's major considera tions on deciding whether or not trade remedies 
could be used under its free trade agreements.  Is it envisaged that similar provisions would be 
introduced in New Zealand's future free trade agreements? 
 
Answer:
 
The New Zealand Australia relationship is such t hat we have been able to move towards very deep 
economic integration.  The CER should be seen in that context.  The provisions in Singapore should 
be seen in the light of the deep and comp rehensive commitments in that agreement. 
 New Zealand generally prefers to retain the right to use all trade remedy instruments in relation to 
trade with a free trade partner.  Whether there will be exceptions to this general rule in future will 
depend on the circumstances of each negotiation and w ill include matters such as the trade profiles of  WT/TPR/M/216/Add.1 
 Page 47 
 
 
  each country and the extent to which they are comple mentary, the history of  trade remedy cases taken 
against the FTA partner and the overall outcome of the negotiation on goods market access. 
 
Q2 According to the Secretariat and Governme nt Reports, New Zealand has reviewed its 
safeguard legislation.  A bill, which is to re peal and replace the present safeguard regime, was 
introduced into the House of Representatives in  September 2008.  We would appreciate it if 
New Zealand would share with us the latest progr ess of the bill, the expected timeframe for the 
completion of the legislative exercise, and when the bill will come into force.  
 
Answer:  
The Bill has been referred to a Select Committee for consideration and the Committee is required to 
report back to parliament by September 2009.  If the Bill is passed into law, it is expected this will 
occur by December 2009.  As drafted, the Bill will come  into effect on the date it is passed into law. 
 
Q3 We appreciate New Zealand's plan to remove four of the five MFN exemptions as indicated in 
its initial and revised services offers.  We note that the remaining one on audio-visual services is of an 
indefinite intended duration.  In line with provisions in the Annex on Article II Exemptions to the GATS which require that all MFN exemptions mainta ined by Members should be reviewed from time 
to time and be in principle not more than 10 years in duration, we would like to know if New Zealand 
has any plan to remove the exemption.  
 
Answer:
 
At this stage, the New Zealand Government is not actively considering the removal of the MFN exemption for audiovisual services (Film Co-Production Agreements).   
COLOMBIA
 
 
Q1 According to paragraph 3 of the report by the Secretariat, New Zealand has maintained its 
open stance towards foreign investment, its legisl ative framework and procedures.  Colombia is 
interested in knowing whether New Zealand's legi slation makes provision for national mechanisms 
for the settlement of investor State disputes or whet her it is necessary to go straight to international 
bodies. 
 
Answer:  
New Zealand encourages investors to first seek r esolution of issues through domestic avenues. 
Investors may have recourse to arbitration in New Zealand as domestic laws and procedures allow. 
In a number of its FTAs and Bilateral Investme nt Treaties New Zealand has agreed provisions 
on investor state dispute settlement.  Only the China NZ FTA and AANZFTA allow for compulsory 
investor state dispute settlement. 
 
Q2 Paragraph 7.  "Under its bila teral and plurilateral agreements , New Zealand, an observer to 
the WTO Agreement on Procurement since end 2008,  is committed not to discriminate between 
suppliers of goods and services;  nevertheless, go vernment departments have been instructed to 
require origin and local content information on all offers to supply goods".  Has New Zealand 
established a local content ceiling for acceptance of lo cal or foreign offers for the supply of goods to 
government departments?  If so, what is that ceiling?  Answer:
 
The statement that "government departments have been  instructed to require origin and local content 
information on all offers to supply goods" comes from the superseded 2002 edition of "Government 
Procurement in NZ:  Po licy Guide for Purchasers".  WT/TPR/M/216/Add.1 
Page 48  
 
  The current edition of the Policy Gu ide (revised August 2007) sets out a requirement for departments 
to include in their documentation of consideration of tenders (at or above $100,000} reasons for the 
rejection of any "New Zealand" tender, and advises that  in order to identify substantial or significant 
New Zealand content, departments will need to ask tenderers to provide sufficient information to give 
a broad indication of the place of origin of goods  or services offered.  Documentation of the reasons 
for rejection of any "New Zealand" tenders is intended  to ensure that departments have given full and 
fair opportunity and considered any value for m oney advantages of competitive local supply, and to 
be a useful source of data to inform the govern ment's supplier capability development programmes to 
help New Zealand suppliers address shortc omings in their tendering practices.  
There is however no local content "ceiling" or benchma rk for acceptance of local or foreign offers to 
supply departments.  As stated in the Policy Guid e (both the superseded and the current versions) the 
Government's procurement policy does not give p reference or weighting to local content in 
itself. Having given domestic suppliers full and fair opportunity and a ssessed any commercial and 
practical value for money advantages associated with  local supply, agencies should buy from the best 
source available, according to their ow n judgement of all costs and benefits.  
Q3 Bearing in mind that New Zealand is a pioneer  in the development of procedures for customs 
clearance and trade facilitation, could it share its experience of preventing, detecting and combating 
customs fraud?  
Answer:
 
New Zealand Customs would be pleased to share its experiences of preventing, detecting and 
combating customs fraud with WTO Members in ac cordance with any bilateral request received. 
 
Q4 According to (e) Tariff concessions, paragraph 29, "Over the years, the policies for granting 
concessions have changed so that in certain circum stances, concessions may now be granted even if 
there is a suitable alternative New Zealand produc tion."  What are the current policies used for 
granting concessions and in what circumstances are they granted? 
 
Answer:  
While there have been changes to Reference 99 tariff concession policy over the years, the issue of 
whether there is New Zealand production of simi lar goods remains the key one.  If there is no 
New Zealand production of commercially available goods and the goods can be described in a legally 
enforceable way, then a 'g eneral' tariff concession is likely to be granted.  The criterion used to assess 
the suitability of a tariff concession is whether there is New Zealand production of "suitable alternative" goods which have a domestic content of not less than 25% of their total factory production cost.    
Suitable alternative goods are defined as those whic h perform the same or a similar function to the 
imported goods for which a c oncession is sought;  and where the imported goods would compete 
directly in the same market.  Price and quality  are not normally taken into consideration. 
 Other circumstances under which Ref erence 99 concessions may be granted are mentioned in the text 
of paragraph 29, namely "In addition to the genera l concessions for products not manufactured or 
produced in New Zealand, specific concessions may be approved for:  shortfalls of inputs to 
manufacturing;  woven fabrics containing wool fo r use in the manufacture of apparel;  and certain 
capital equipment".  
Q5 According to footnote (a) to Table III.4 "New Zealand standards, 2002-08", the New Zealand authorities do not keep statistics on the percentage of standards that are mandatory.  Has New Zealand 
considered the possibility of drawing up an invent ory of mandatory standards?  Are there different 
bodies dealing with mandatory standards?  WT/TPR/M/216/Add.1 
 Page 49 
 
 
  Answer:  
Like most countries, New Zealand has a range of re gulatory regimes, each focused on a different set 
of risks or products, that each include mandato ry standards.  No single authority maintains an 
inventory of the number of mandatory standards across these regimes, and there are no plans to do 
so. 
 Q6 In both paragraph 17 of the section on me asures directly affecting imports and in 
paragraph 75 of the section on measures directly aff ecting exports, reference is  made to a performance 
agreement between the Government and the Ne w Zealand Customs Service whereby import and 
export applications lodged and cleared electronically through the Electronic Data Interchange must be 
processed within 30 minutes.  We would be grateful if New Zealand would share its experience of this 
software since it went into operation, particularly  in the light of the private sector's readiness to 
contribute to the efficient running of the system.  
Answer:
 
In New Zealand, the EDI gateway is managed by a third party.  The EDI process allows importers 
and exporters to submit their entry declarations el ectronically and they can utilise the process via the 
internet or by installing appropriate  EDI software on their own systems.   
 Electronic lodgement for import and export entri es is a requirement under the Customs and Excise 
Act 1996. 
 
Q7 In paragraph 4 of the Secretariat's Report, it is stated that "The share of manufactures in total merchandise exports declined from 31.5% in 2003 to  27.7% in 2007.  The Government is committed 
to developing New Zealand into a high value, hi gh wage and export-led economy.  With a view to 
pursuing these objectives, the Government has take n various measures, such as increased budgetary 
funding for skills development, market development and international marketing … ". What strategies 
and actions has the New Zealand Government e nvisaged for the skills development, market 
development and international marketi ng referred to in this paragraph? 
 
Answer:
 
The Government's primary mechanism for deli vering support for business capability building and 
market development activities is through its tr ade and economic development agency, New Zealand 
Trade and Enterprise (NZTE).  In early 2009 the Go vernment announced the consolidation of NZTE's 
existing business assistance grant schemes into the existing Growth Services Fund (GSF).  The Fund 
will support firms to develop skills and resources to  implement their growth strategy.  Overall 
spending on grant schemes is being reduced from $63.042m in 2008/09 to approximately $30.000m 
by 2010/11.  Funding is also provided to NZTE and other agencies for a range of international 
marketing and brand development initiatives aimed at building New Zealand’s profile internationally.  
 The new Government is still in the process of developing its overa ll strategy for skill development in 
the economy.  The previous Government developed th e NZ Skills Strategy in collaboration with 
business and industry groups and unions with the ob jectives to explore the link between skills and 
productivity, respond to skills short ages, and to make the most of the Government's investment in 
skills by encouraging a coordi nated and unified approach to policy development and delivery. 
 
Q8 In paragraph 7, the Secretariat states that  economic reforms in the 1980s and 1990s have 
increased efficiency in the agricu lture sector in New Zealand.  Could New Zealand indicate the main 
policies which allowed this increase in efficiency? 
 
Answer:
 
The fundamental aim of the economic reforms of  the 1980s was to generate sustained economic 
growth and to promote efficiency in the New Ze aland economy by creating a 'level playing field' on WT/TPR/M/216/Add.1 
Page 50  
 
  which economic actors (including farmers) w ould compete equally and market forces would 
determine success.  The fundamental policy tool to achieving this objective was deregulation, 
particularly the removal of government interventions  that distorted the market and isolated parties 
from the impacts of their decisions.  A summary of the key economic reforms is set out below. 
 
Specific agricultural reforms
 
All trade-distorting subsidies were withdrawn from 1985.  Price supports were abolished, farm loans 
were moved to market rates, capital and input (e .g. fertiliser) subsidies were removed, exit packages 
for uneconomic farms were provided, advisory services changed to being 'user pays', and tax 
concessions for farmers were withdrawn. 
 
Generic reforms  
- Exchange controls removed – the New Zealand dollar was floated in 1985, which 
provided clearer signals of the relative price of productive inputs and outputs. 
- Deregulation of the financial sector – cont rols on all lending and deposit rates were 
removed. 
- Inflation-focused monetary policy – the cen tral bank was required to set a clear 
single monetary policy with the aim of achieving and maintaining price stability to reduce the persistently high levels of inflation.   
- Deregulation of the labour market – i ndividual employment contracts were 
introduced to allow employers and their st aff more choice in determining terms of 
employment. 
- Expansion of trade liberalisation – tar iffs were lowered, the extensive import 
licensing system was removed, and the trade  relationship with Australia was 
enhanced through the Closer Economic Partnership. 
- Taxation reforms – reforms were introdu ced to reduce the government deficit and 
create one of the least distorting tax systems  in the OECD (e.g. through introduction 
of a uniform Goods and Services Tax). 
- Commercialisation/Privatisation – for example, previous government functions were 
transferred to state-owned enterprises whic h were made accountable on a profit and 
loss basis. 
- Effects-based environmental regulation – new environmental legislation was 
introduced to encourage res ource users to take into acc ount third party effects of 
their actions and to promote sustainable practices. 
 
Q9 According to paragraph 10, New Zealand h as a Commodity Levies Act.  Could New Zealand 
indicate which commodities are identified, providing more detail of the benefits or restrictions 
established by this Act? 
 
Answer:
 
Commodities under the Commodity Levies Act 1990: Arable Crops (wheat, barley, etc), asparagus, 
avocado, blackcurrants, eggs, fe ijoa, meat, milk, nash asian pe ar, navel oranges, herbage seed, 
passionfruit, apples and pears, satsuma mandarin, summerfruit (peaches, pl ums, cherries, etc), 
tamarillo, all fruits and vegetables, grapes for wine  making, grape wine, non- grape wine (i.e. other 
fruit wine), wool.  Please note that all levies are imposed only on New Zealand production, not on imported commodities. 
 
Benefits of the Commodity Levies Act 1990: 
- Industry groups can prioritise their spendi ng and focus on activitie s that will provide 
maximum benefits. 
- Industry groups are able to use their levy funds to leverage research funding from 
other sources, and this also ensures that research is more focused on industry 
requirements.  WT/TPR/M/216/Add.1 
 Page 51 
 
 
  - The producers themselves decide collectively whether there is to be a levy on their 
commodity and each levy order lasts six yea rs, after which there is a vote on whether 
or not to continue for another six years.  This means that if levy payers are not convinced that benefits exceed costs of the l evy then they can vote to discontinue with 
the levy.  This imposes strong accountab ility on the levying organisation to maximise 
benefits of levy spend. 
- There are annual consultation requirements, giving levy payers the opportunity to 
decide the levy rate and what the levy is to be spent on. 
- This framework removes the free-rider pr oblem of a voluntary levy, and the forced-
rider problem is minimised by the manner in which referendum support is measured. 
 
Restrictions under the Commodity Levies Act 1990: 
- Levies are not used for commercial or tradi ng activities, for example, levies collected 
on avocadoes cannot be used to purc hase avocadoes for sale or export. 
 Q10 Paragraph 15 refers to single commodity tr ansfers (SCT), which reflect the difference 
between world and domestic prices.  Why does this instrument apply only to eggs and poultry?  Could 
New Zealand indicate what support is granted for the meat and dairy sector?  
Answer:
 
As a result of a blanket import ban on uncooked poul try and eggs which has been imposed to protect 
the local poultry industry and some native bird sp ecies from exotic diseases and pests domestic prices 
tend to be higher then international prices for poul try and eggs.  This measured market support is by 
accident rather than design as the intention of th e policy is to protect the poultry industry and some 
native birds from exotic diseases and p ests not to provide market support. 
 
Q11 Could New Zealand indicate the financial inst ruments it grants to its agricultural sector?  
What are the conditions of eligibility for such suppor t?  For what products is such support granted? 
 
Answer:  
Budgetary support is provided for basic researc h on pest and diseases control, border control 
inspections, disaster relief for adverse events and for projects to encourage sustainable farming 
practices. 
 Please see New Zealand's latest Domestic Support notification (G/AG/N/NZL/52) for more 
information. 
 Q12 According to paragraph 16, at present two pr oducer organizations have statutory powers to 
collect levies from producers and they operate as marketing boards.  Could New Zealand enlarge on the way these boards operate?  Why have all the others  been abolished?  How does the receipt of the 
levies by producers operate?  Do the levies have to be  remitted to the State?  What is the purpose or 
destination of the levy?  Answer:
 
While the Pork Industry Board and Deer Indust ry New Zealand may use the levies for market 
development and promotion work, they do not purchase or sell their respective commodities, i.e., they 
are NOT marketing boards.  
These boards are operated and funded by the industri es themselves.  They elect boards of directors to 
provide overall governance of the organisation.  They have their own staff.  They have annual levy 
payer consultations to identify key industry issues  and priorities.  They sometimes contract other 
parties to deliver services such as research outputs.  WT/TPR/M/216/Add.1 
Page 52  
 
  Producer boards in other industries have been disest ablished as industries have decided to operate 
under generic corporate legislation such Compani es Act 1993 and under the Commodity Levies Act 
1990 as that legislation has strong accountability measures.  Pork levies are collected by processors, who forwar d that to the Ministry of Agriculture and Forestry 
(MAF), and MAF passes the full levy on to the industry organisation.  For the deer industry levy, 
processors pay the levy direct to their industry organisation.  Both industry organisations have board 
of directors elected by levy payers and they decide on the levy spending on behalf of growers and farmers.  Growers and farmers are consulted every year to gauge issues and priorities for levy 
spending. 
 
The types of activities they spend their levi es on are mostly around product research and development 
(R&D), production R&D, market R&D, technol ogy transfer, establis hing quality assurance 
programmes, training and education, and pr omoting their products and their industries. 
 Q13 The Secretariat report states in paragraph 57 that "Foreign-owned insurers can operate as 
branches in New Zealand, provided all licensing, monitoring, and other prudential requirements are 
met.  However, if foreign insurers are fully comp liant with their home-country regulator's prudential 
requirements, the RBNZ will have discretion to  accept compliance with these requirements and 
exempt these insurers from certain aspects of New Z ealand's requirements."  What are the aspects of 
New Zealand's requirements from which the RBNZ may ex empt insurers that are fully compliant with 
their home country regulator's prudential requirements? 
 
Answer:
 
The Insurance regulations are still being finalised  – for more detail please go to http://www.rbnz. 
govt.nz/finstab/nbdt/insurance/. 
 
 THAILAND
 
 
Q1 On page 33 of the report by the Secretariat,  it is mentioned that, during August 2002 - August 
2008, 1,609 investment applications  were screened and only 33 appli cations related to sensitive land 
were rejected.  Furthermore, the processing time for applications seem to be lengthy. 
 Q1-1 What is the usual length of time fo r processing an investment application?  
 
Answer:
 
The median turnaround time for a ll applications that were deci ded between 1 October 2008 and 
31 May 2009 was 19 working days. 
Q1-2 Will the investor be notified in writing if th e application is rejected?  If yes, will the reason 
for rejection be provided?  
Answer:
 
Yes and yes.  WT/TPR/M/216/Add.1 
 Page 53 
 
 
  THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND 
MATSU  
 Q1 We note from the Report that, in July 2007 , the New Zealand Government introduced the 
KiwiSaver scheme to supplement the State pensi on system.  We would be grateful for further 
information on the following aspects:  Q1-1 What are the alternative approved saving schem es available to participants?  How have these 
schemes been approved?  Is there a guaranteed rate of return under the schemes provided? 
Q1-2 Does the provider of a scheme have the right  to refuse an application from any worker?  Can 
a scheme be restricted to members of a pa rticular trade union or industry only? 
Q1-3 Can participants transfer their contributions  from one scheme to another if they find one that 
is better-performing?  Q1-4 The report indicates that savings are locked in  until the age of 65.  Are there any conditions 
under which pension reimbursement may be claime d earlier, such as long-term unemployment, 
disability, death or unexpected severe incidents?  
Answer:
 
Joining KiwiSaver is not compulsory, and there are mu ltiple providers for the sch eme.  Furthermore, 
people can also join more traditional superannua tion schemes.  There are no guaranteed rates of 
return for any KiwiSaver scheme, and in some in stances negative returns have occurred.  Schemes 
can have their own rules about who can apply to be members, and membership can be transferred 
from one scheme to another.  There are situations un der which savings may be accessible prior to 65. 
 
Please see the following link for more detail http://www.kiwisaver.govt.nz/. 
 
Q2 We note from the Report that responsibility for regulatory impact analysis (RIA) shifted to 
the Regulatory Impact Analysis Team (RIAT) fro m November 2008.  Could New Zealand please 
describe RIAT's functions, its role and the scope of its responsibilities in the regulatory management 
system? 
 
Answer:  
In June 2008, the Government took decisions to  strengthen the regulatory management system, and 
put in place a more strategic approach to managing the impact of regulation on economic 
performance. 
 
To give effect to these decisions, the Treasu ry was assigned responsib ility for New Zealand's 
regulatory management system, expanding its role into three areas.  These are: 
- Regulatory impact analysis.  This work was previously undertaken by the Regulatory 
Impact Analysis Unit in the Ministry of Economic Development, but from 3 November 2008 sits with Treasury's Regulatory Impact Analysis Team (RIAT).  
- Responsibility for setting a prioritised regulatory review work programme and 
co-ordinating across government agenc ies to deliver on this programme.  
- Strategic co-ordination of the regul atory quality system, including recommending 
improvements to the system and handli ng Cabinet and Parliamentary processes 
related to regulations and regulatory reform.  
 
These functions complement Treasury's role as the Government's primary economic and fiscal 
advisor.  WT/TPR/M/216/Add.1 
Page 54  
 
  RIAT's role
 
 RIAT is an independent unit located within the Tr easury. RIAT is required to formally assess the 
regulatory impact analysis (RIA) and regulatory impact  statement (RIS) for any regulatory proposal 
that is likely to have a significant impact on economic growth.  
 
This role comprises: 
- Commenting on discussion document to ensure that the design of the document is 
likely to enable the agency to undertake ade quate RIA after stakeholder feedback has 
been received;  
- Reviewing the RIA to determine whether it is adequate;  and  
- Reviewing the RIS to determine whether it is adequate.  
 Agencies are responsible for determining whether th eir proposal meets the significance criteria.  For 
proposals that do not meet the significance criteria,  the authoring agency is responsible for certifying 
whether they have met the adequacy criteria.  
 RIAT's adequacy assessment is included in the RIS and the accompanying Cabinet paper.  If RIAT 
deems the RIA and/or RIS for a proposal to be inad equate, they have a mandate to brief the Minister 
of Finance and the Minister for Regulatory Reform.  
More information can be found at:   
http://www.treasury.govt.nz/publications/guidan ce/regulatory/impactanalysis/04.htm#04htmpara25. 
 
Q3 The Report states that the P4 agreement, whic h contains an open clause, is considered as a 
potential driver for a large trans-Pacific arrangement .  Could New Zealand please further elaborate its 
position and strategy for the enlargement of the P4 agreement?   Answer:
 
The TPSEPA is "open to accession on terms to be  agreed among the Parties, by any APEC Economy 
or other State" (Article 20.6.1).  Decisions  on new participants in the TPSEPA are made by 
consensus.  
 
The current phase of negotiations will involve eight participants. New Zealand hopes that this will be 
followed by further expansion to include others in the region also committed to high-quality economic 
integration in the Asia-Pacific region,  consistent with WTO and APEC goals. 
 Q4 We note that New Zealand maintains some of the most advanced customs and trade 
facilitation procedures aimed at speeding up the processi ng of international trade transactions, and we 
commend New Zealand on its efforts to facilitate trade.   We are aware also of the importance of the 
AEO programme in this respect.  
 Q4-1 We are interested in knowing whether New Zealand implements the AEO programme.  If yes, 
what kind of preferential clearance measures do es its Customs offer importers and exporters?  
 Answer:
 
New Zealand operates an AEO programme known as th e Secure Exports Scheme (SES).  SES partners 
qualify for preferential status that provides maxi mum facilitation and minimum intervention for their 
exports.  All other exporters have a higher potentia l for intervention because the security of their 
goods cannot be assured.  New Zeal and provides maximum facilitation (such as deferred payment of 
duty) to all importers – unless there is evidence that they are non-compliant.   WT/TPR/M/216/Add.1 
 Page 55 
 
 
  Q4-2 We know also that New Zealand has signed Customs Mutual Assistance Agreements with 
America and Japan.  We would appreciate knowing what kind of preferential measures New Zealand can obtain through these Agreements.  
 
Answer:
 
New Zealand has signed both mutual assistance and mutual recognition arrangements with Japan 
and the US.  Mutual recognition arrangements prov ide enhanced border clearance benefits for AEO 
members.  The mutual assistance arrangements are also focused on the exchange of information.   
 
Q5 New Zealand government departments are require d to include in their internal documentation 
basic reasons for justifying the rejection of any New Zealand te nder for contracts at or above 
NZ$ 100,000.  Since New Zealand opens its Governme nt Electronic Tenders Service (GETS) system 
to companies from all over the world to promote open, fair competition in the New Zealand 
government market, has the above regulation led to discrimination between domestic and foreign 
suppliers? 
 
Answer:  
The Policy Guide for Purchasers (2007) states that this  Cabinet direction is not to be interpreted as 
requiring preferential short-listing or final selection of  New Zealand tenders, a nd that the aim is to 
ensure full and fair consideration of the objective mer its of New Zealand as we ll as other tenders in a 
whole-of-life value for money context, in accordance with the existing policy, and to provide data to 
inform supplier development programmes.  Departmen ts continue to be bou nd by the Mandatory 
Rules for Procurement by Departments (2006), which require non-discrimination (Rules clauses 16 
and 17).  
 
Q6 We note that all exporters are required unde r Section 49 of the Customs and Excise Act 1996 
to lodge an export document with the New Zealand Cu stoms Service.  As of 1 March 2004, all export 
entries have been required to be lodged and cleared  electronically prior to the goods being loaded for 
export.  We would appreciate further information as follows:  
 
Q6-1 Is there any time limitation in this programme?   Answer
 
The Customs & Excise Regulations 1996 (Reg 28) req uires that an export entry must be lodged '…not 
less than 48 hours before the goods are shipped for export'. 
 Q6-2 What is the detailed information th at exporters are required to declare? 
 Answer
 
An export entry provides full details of the consignm ent to be exported.  A summary of the information 
required can be found in Fact Sheet 6A: Comple ting an Electronic Export Entry accessible at 
www.customs.govt.nz.   
Q6-3 Are exporters required to make a supplementa ry declaration about the information that they 
have not declared earlier?  Answer
 
No, an export entry must be completed in full before clearance will be given. 
 
Q7 Several SOEs were privatized in the mid-1980s, but since 1999 there has been a policy 
reversal.  During the period unde r review, no further privatization of State assets has taken place, and 
New Zealand proceeded with the buy-back of Air New Zealand, the railways and ferries, etc.  We are 
interested in the following aspects: WT/TPR/M/216/Add.1 
Page 56  
 
  Q7-1 Will the buy-back & re-nationali zation interfere with free trade?  
 
Answer:
 
No.  
Q7-2 Is there any privatization plan for the SOEs now?  
 
Answer:
 
No.   
Q7-3 Will there be any limitations placed on fore ign investors during the privatization process? 
 
Answer:
 
N/A. 
 
Q8 As indicated in the Report, power distribu tion businesses are subject to economic regulation, 
information disclosure and price-quality regulation,  and the Commerce Commission is to set "default" 
price and quality paths from April 2009.  However, individual businesses may apply for customized 
terms and propose alternative price and/or quality paths.  
 Q8-1 Have any business proposed alternativ e price and/or quality paths so far? 
 
Answer:
 
No regulated service provider has applied for a cust omised price quality path as we have not yet set 
the input methodologies that are a pre-requisite for these applications (see S53(2)(A) of the 
Commerce Act).  The deadline for the setting of the input methodologies is 30 June 2010.  
Q8-2 What are the criteria and concerns regardi ng the examination of alternative paths by the 
Commission? 
 
Answer:
 
The Commission is going through the process of setting the methodologies for customised price 
quality paths under s52T of the Commerce Act.  The legislation signals specific matters that must be 
included in input methodologies for customised price quality paths.   
(1) The input methodologies relating to particular  goods or services must include, to the extent 
applicable to the type of regulation under consideration:  (d) matters relating to proposals by a regulated supplier for a customised price-quality 
path, including - 
  (i) requirements that must be met by the regulated supplied, including the scope 
and specificity of information required, th e extent of the independent audit, the 
extent of consultation and agreement with consumers  ; and 
(ii) the criteria that the Commission will use to evaluate any proposal  
 Initial consultation was undertaken by the Co mmission in December on the approach that the 
Commission intended to undertake on Input Methodologi es ("Regulatory Provisions of the Commerce 
Act 1986: Discussion Paper").  The Discussion paper is available on the Commission's website, as 
are copies of the submissions received from int erested parties.  The Commission is expecting to 
consult on its preliminary views in the near future.  
Q9 It would be appreciated if New Zeala nd could provide further details as follows: 
  WT/TPR/M/216/Add.1 
 Page 57 
 
 
  Q9-1 Do the New Zealand port authorities collect th e port security charge?  If yes, are the charge 
rates for national ships and foreign ships the same?  Answer:
 
There is no port security charge as such.  Mar itime New Zealand's work in relation to the Maritime 
Security Act is funded by the Crown.  
 
As described in paragraph 74, much of Maritime New Zealand's safety regulatory work, including 
port state control, is funded by a Marine Safety Charge which is collected by Maritime New Zealand 
from all commercial shipping.  The rates for d ifferent types of shipping (international, domestic, 
passenger, freight etc) differ according to the amount  of regulatory effort and risk involved with each 
shipping type and whether they trade constantly in  New Zealand, in which case most pay an annual 
charge, or visit from time to time, in which case charges are typically per port call.  The different 
rates are clearly set out in the Marine Safet y Charges Regulations, available online from 
www.legislation.govt.nz 
 Q9-2 What are the policy strategies for New Zeal and coastal shipping?  What do authorities do to 
expand the market share?  Answer :
 
In 2008, the New Zealand Govern ment published a strategy, Sea Change, for domestic sea freight, 
available from the Ministry of Transport's we bsite at http://www.transport.govt.nz/seachange/ 
 Since the change of Government in November 2008,  the funding described in paragraph 71 has been 
discontinued, but work on the information-gatheri ng and workforce elements of the strategy is 
continuing.  The emphasis is on non-moneta ry interventions, removing unnecessary regulatory 
constraints on the sector and working with th e sector to overcome hurdles and blockages. 
  Q10 We note that during the period of review, besides launching the International Education 
Agenda in August 2007, New Zealand had also im plemented some changes in the education sector, 
including introduction of the Export Education Levy (EEL) in 2003 to fund sector development.  We 
should be grateful for further clarification as follows: 
 Q10-1 Since the EEL is a new and different measure from the standpoint of our domestic educational 
system, what legal provisions or administrative measu res does it originate from?  That is to say, what 
is its legal basis?   Answer:
 
The Export Education Levy was introduced as part of the Education Amendment Act 2002, which 
modified the provisions of the E ducation Act 1989.  In  particular, the Export Education Levy is 
authorised according to sections 238H and 238I of the Education Act 1989.  Following passage of the 
Education Amendment Act 2002, the Export Educ ation Levy was implemented from 10 January 2003. 
Annual reports are provided to Parliament on the funding and expenditures from the Export Education Levy, and these can also be found (as PDF texts) on the website of the Ministry of Education (www.minedu.govt.nz). 
 Q10-2 What are its purposes and functions in accordance with the above provisions? 
 
Answer:
 
Section 238I of the Education Ac t 1989 sets out the permitted purposes of the Export Education Levy.  
These are: Purpose and administration of  export education levy  
(1) The purposes to which the funds of the levy may be put are as follows: WT/TPR/M/216/Add.1 
Page 58  
 
   (a) the development, promotion, and qualit y assurance of the export education sector, 
which may include (without limitation)— 
  (i) professional and institutional development; and   (ii) marketing;  and   (iii) implementation of scholarship schemes;  and 
  (iv) research, and resource development;  and 
  (v) support (financial or otherwise) of other bodies engaged in the development, 
promotion, or quality assurance of the export education sector: 
 (ab) the making of payments as set out in subsections (1A) and (1B):  (b) the administration and audit of the code: 
 (c) the general administration of  the levy and associated purposes. 
 
Q10-3 What practical experiences has New Z ealand gained from implementing the EEL, e.g. 
difficulties in promoting or carrying out the EEL? 
 
Answer:
 
The initial difficulties in implementing the Export E ducation Levy related to establishing an on-line 
payment system for the 1000+ education providers ac tive in enrolling international students.  This 
project was put in place by the Finance Team of th e Ministry of Education.  There have been minor 
on-going issues re pursuing unpaid levies, particularly by providers which have left the industry.  The 
process for this is the standard debt collection system. 
 Q11 New Zealand maintains an open framework for foreign investment and its largest sources of 
FDI are Australia, the United States and the United Kingdom. 
 
Q11-1 Has New Zealand signed bilateral investment agreements (BITs) or FTAs that include the Chapter of Investment, with Australia, the United States, the United Kingdom and other countries? 
 
Answer:
 
NZ has yet to conclude bilateral agreements cove ring investment with the US, Australia or the UK, 
although we have concluded FTAs that include invest ment chapters with Thailand, Singapore, China, 
ASEAN and Malaysia.  See answer to the next qu estion for information on negotiations currently 
underway.  
 
Q11-2 Does New Zealand currently have any plan s to sign new BITs or FTAs that include the 
Chapter of Investment, with any other countries in orde r to continue to maintain the stable growth of 
foreign investment? 
 
Answer:  
NZ is already in negotiation with Australia towards conclusion of a bilateral agreement on investment.  New Zealand is also seeking provisions on investment in  its FTA negotiations with the 
GCC, Korea and Hong Kong, China. 
  
In addition the four members of the Trans-Pac ific Strategic Economic Partnership Agreement 
(Brunei, Chile, New Zealand and Singapore) be gan negotiations on a TPSEPA investment chapter in 
2008.  The United States also participated in those negotiations while it considered whether to enter 
into comprehensive negotiations to join the TPSEPA.  Investment  negotiations are expected to 
continue as part of negotiations for the United Stat es, Australia and Peru to join the TPSEPA as full 
participants. 
 
Q12 As the Report states, when facing the global financial crisis, the Prime Minister convened a 
Jobs Summit to test ideas and find workable soluti ons to maintaining high levels of employment.  
Could the New Zealand Government please elaborate further on any ideas or workable solutions to  WT/TPR/M/216/Add.1 
 Page 59 
 
 
  maintaining high levels of employment proposed by  business, unions and the Government both during 
and after the Jobs Summit? 
 
Answer:  
The Job Summit held in February contributed va luable ideas for preserving jobs through the present 
economic crisis and creating best possible conditions  for business to step up as economic conditions 
improve.  There was positive engagement from appro ximately two hundred of New Zealand's top 
business, government, and community and union leaders.  During the Summit delegates were divided into six work streams: core wo rkplace and employment 
issues;  workers skills and transition;  local and regional government, and Maori economy;  helping 
firms survive;  business investment;  and firm funding. 
 
From these groups a wide-range of ideas to solve the expected rise in unemployment emerged.  Some 
of these ideas have already been taken forward by the Government: 
- A nine day fortnight: a job support scheme was introduced for firms with more than 
100 employees in March and extended to cover firms with more than 50 employees in 
April. 
- Enhance utilisation of Iwi assets: the Maor i Trustee Amendment Act was enacted in 
May 2009; proposals for improving Systems for Valuation and Rating of Maori Land 
are being finalised; and a survey of  600 Marae around the country to gather 
information on Marae infrastructure requirements. 
- Reduce regulatory compliance costs and impediments:  a programme of reviews has 
been launched (see details  on Treasury's website http://www.treasury.govt.nz/ 
economy/regulation/programme);  a Regul atory Improvement Bill has been 
introduced;  and a Regulatory Responsibility Task Force set up. 
- Nationwide cycleway – Advisory Group established and $50 million of Government 
funding allocated over the next three years. 
 
The May 2009 budget delivered a multi-billion dollar boos t to infrastructure investment and spending 
on public services.  An extra $1 billion will be spen t over the next three years on the state highway 
network;  $323.3 million will be spent on home in sulation and a clean heating campaign;  and 
$1.68 billion will be spent on education to raise st udent achievement.  These initiatives will employ 
New Zealanders and create work for bus inesses throughout the regions. 
 
 CANADA
 
 Q1 The Secretariat notes that "[i]n 2006, Cabine t endorsed the Mandatory Rules for Procurement 
by Departments, which apply to central government  departments, the New Zealand Police, and the 
New Zealand Defence Force for purchases at or ab ove NZ$100,000 for goods and services, and at or 
above NZ$10 million for construction services".   
Q1-1 Could New Zealand please clarify if all foreign suppliers have access to these bidding 
opportunities?   
Answer:
 
Yes, all foreign suppliers have access.  As stated in the Introduction (clause 1), the Rules reflect and 
reinforce New Zealand's established policy of  openness and transparency in government 
procurement.   They are to be applied by departments in their procurement globally to facilitate 
competitive participation by domestic and forei gn suppliers in New Zealand's government 
procurement market.  The Rules (clauses 16-17) sp ecifically require that departments accord all 
potential suppliers equal opportunity and equitable treatment and that procurement decisions be WT/TPR/M/216/Add.1 
Page 60  
 
  made on the basis of value for money, not place of origin or degree of foreign ownership or affiliation 
of the supplier.  
 
Q1-2 Could New Zealand please indicate whether or  not foreign suppliers are permitted to compete 
on procurement opportunities below the thresholds? 
  
Answer:
 
Yes, in New Zealand's open government procurem ent market, agencies are encouraged to seek best 
value for money in procurement at any level by  affording competitive opportunity where practicable 
to all interested suppliers, domestic or foreign.  
 
Q2 The Secretariat notes that New Zealand h as been an observer to the WTO plurilateral 
agreement on Government Procurement (GPA) si nce December 2008.  Could New Zealand please 
confirm when it plans to begin its accession to the GPA?  Answer:
 
New Zealand became an observer on the GPA committee without commitment as to GPA membership.  
This matter is however under continuing review in the light of domestic and international developments.  
 
Q3 In paragraph 58 of the Secretariat Report, the Secretariat provides statistics on fixed line 
penetration as well as mobile phone penetration.  
 Q3-1 Could New Zealand provide additional statis tics and a further description of the competitive 
landscape in its telecommunications market?  
 
Answer:
 
Additional statistics are available at the followi ng link, which provides New Zealand ICT related 
statistics:  http://www.stats.govt.nz/economy/i ndustry/information-communication-technology.htm.   In 
particular, please see the 'Internet Service Provider Survey'.   The Commerce Commissions' sector 
monitoring reports also provide useful informa tion regarding the competitive landscape of the 
telecommunications market, and are available at:  http://www.comcom.govt.nz/IndustryRegulation/ 
Telecommunications/MonitoringandReporting/Decisi onsList.aspx.  The 2008 Telecommunications 
Market Monitoring Report is particularly relev ant, and is available on this website. 
 
Q3-2 Could New Zealand describe, for example, th e largest three service providers in each of the 
fixed-line telephone, mobile tele phone, broadband internet, and tele vision distribution segments by 
indicating each participant's market share, its tran smission facilities, and whether they are owned or 
leased?   
Answer:
 
Given the relatively small size of the New Zealand telecommunications market, much of the requested 
information is commercially confidential and therefore not publicly available.  We set out below the 
information that is publicly available.  
 Fixed-line telephony  Telecom New Zealand and TelstraClear are the tw o largest operators and there are a small number 
of 3
rd tier players in the market (with a very low combin ed market share).  Telecom's market share (in 
terms of revenue from fixed telephone  services) for 2006/07 was 83%.  
Telecom (the incumbent operato r) owns the only nationwide fixed (copper access) network in 
New Zealand.  TelstraClear owns  a cable (HFC) network in three regions (Kapiti, Wellington, and 
Christchurch), and also provides services us ing Telecom’s network on a nationwide basis. 
  WT/TPR/M/216/Add.1 
 Page 61 
 
 
  Mobile telephony 
There are currently two mobile operators in New Zealand (Vodafone and Telecom), with a new 
entrant (2degrees) expected to launch a th ird network in August this year.   
In terms of mobile phone connections, Vodafone' s market share as at March 2009 was 53% (Telecom 
47%).  However this statistic is confused by th e fact that mobile penetration is over 110% in 
New Zealand (as it is common for users to have a phone from each network).  It is generally accepted 
that Vodafone has at least 60% market sha re in terms of revenue from mobile services. 
Vodafone and Telecom own their transmission facilities.   2degrees will operate with a combination of 
its own transmission facilities in city centres and th rough a roaming agreement with Vodafone outside 
of these areas.   
 
Broadband internet  The three largest ISPs in New Zealand are Telecom,  TelstraClear and Vodafone.  The only official 
market share data available is Telecom's share of  broadband connections (68% for 2006/07).  Rough 
estimates indicate that TelstraClear's share of connections is under 20% and Vodafone's is under 
15%. 
Telecom provides its services over its copper access netw ork.  TelstraClear provides its services over 
its cable network where available and elsewhere le ases capacity from Telecom.  Vodafone provides 
services over its cellular network and also leases capacity from Telecom to provide fixed broadband 
services.  
Television Distribution 
The largest broadcasting service providers are: 
- Television New Zealand Ltd: Two channels;  free to air;  largest terrestrial 
population coverage.  Distribution and broadc asting of programming is via contract 
with Kordia Ltd (a state owned enterprise).  Transmission and distribution equipment 
is owned by Kordia Ltd. 
- Mediaworks Ltd:  Two channels;  free to air;  second largest terrestrial population 
coverage.  Distribution of programming is  via contract with Telecom Ltd.  
Transmission is via a mixture of sites operated by Kordia Ltd and Mediaworks. Transmission equipment is owned by Mediaworks. 
- Sky Television NZ Ltd:  One channel free to air;  multiple channels as pay TV 
service;  four channels via terrestrial delivery;  all channels via digital satellite.  
Distribution of satellite programmes is via SingTel-Optus satellite.  Distribution of terrestrial programmes is via contract w ith Kordia Ltd.  Terrestrial transmission 
equipment owned by Kordia Ltd. 
 
COMMENTS FROM THE GOVERNMENT OF CANADA  
Comment 1:  Canada would like to note that Ca nada, Australia and New Zealand signed a competition 
agency-to-competition agency cooperation arrangement, not a state-to-state cooperation agreement.  If 
the Secretariat prefers, the wording in the report,  "…has cooperation agreemen ts…" could be changed 
to "…has cooperation instruments...". 
 
For more information please refer to:  http:// www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/ 
01595.html   Comment 2:  Canada would also like to note th at the arrangement was signed by the Australian 
Competition and Consumer Commission, not the G overnment of Australia.  For greater accuracy, 
Canada would suggest the following language for the report:  "The Commerce Commission also has cooperation agreements with the Commissioner of  Competition in Canada (also signed by the 
Australian Competition and Consumer Commission)…".    WT/TPR/M/216/Add.1 
Page 62  
 
  New Zealand comments:
 
We are happy to accept Canada's suggested wording.   Perhaps for consistency, the second reference 
to Australia should also be changed to the ACCC so the sentence would read:  "The Commerce Commission also has cooperation inst ruments with the Commissioner of Competition 
in Canada (also signed by the Australian Co mpetition and Consumer Commission), and the Chinese 
Taipei Fair Trade Commission (also signed with the ACCC)."  
 
UNITED STATES
 
 
Q1 The Secretariat's Report states, "Regulatory re view has proceeded on an ad hoc basis across 
the various sectors and ministries.  However, in its post-election plan, the new Government signalled 
its intention to begin a regulatory review progr amme to identify and remove inefficient and 
superfluous regulation."  What is the status of the Government's "regulatory review"? 
 
Answer:  
Initiatives that have already been  put in place to improve the quality of regulation include: 
- Setting up the Regulatory Review Programme  for major and pervasive regulation for 
2009 and 2010 , comprising: 
 
Review is underway or in implementation 
stage Review in 2009 (most already commenced) Proposed review in 2010 
Climate Change Response Act 
Raw milk regulations Resource Management Ac t (RMA) (Phase 1) Building Act 
Election commitments on Employment 
Relations Act amendments 
Foreshore and Seabed Act Holidays Act 
Overseas Investment Act and Regulations Resource Management Ac t (RMA) (Phase 2) 
Telecommunications Act 
Weather Tight Homes Resolution Services Act Electricity institutional arrangements 
Food Safety Rule review 
Also work on Hazardous Substances and New 
Organisms Act (HSNO) Financial Market Regulation 
Local government regulations Occupational licensing 
 
- Identifying the first tranche of inefficient and superfluous regulations for immediate 
removal; this will be an ongoing process resu lting in regular Regulatory Reform 
Bills;  and 
- Establishment of a Regulatory Task Force to progress a Regulatory Responsibility 
Bill, aimed to increase transparency around the principles of responsible regulatory 
management that apply to Government policies and accountability against those 
principles. 
 Consideration is currently being given to the Government making some explicit commitments about 
regulation and strengthening the existing arrangements for assuring the quality of regulation.  The aim would be to change the state sector's attitude  and approach to regulation, and ultimately reduce 
the amount of poor quality regulation, reduce the flow of regulation (primary, secondary and tertiary) 
and reduce regulatory costs. 
 
Q2 According to the Secretariat, the Govern ment decided in June 2008 to strengthen the 
regulatory management system and establish "a more  strategic approach to managing the impact of  WT/TPR/M/216/Add.1 
 Page 63 
 
 
  regulation on economic performance."  In so doi ng, Departments "also consult domestic business 
stakeholders at an early stage on potential policy proposals."  At what point are all business stakeholders consulted on such proposals?  Ho w does the government define "domestic business 
stakeholders"?  What is the status  of the Government's undertaking? 
 Answer:
 
There are no specific requirements about the point at  which businesses should be consulted.  The 
Code of good Regulatory Practice which was endo rsed by Cabinet in 2007 includes the following 
statement about consultation:  
"Public consultation should occur as widely as possible, given the circumstances, in the policy 
development process.  A well-designed and implemen ted consultation progra mme can contribute to 
better quality regulations, identification of the more effective alternatives, lower costs to business and 
administration, ensure better compliance, and pr omote faster regulatory responses to changing 
conditions." 
 
'Domestic business stakeholders' are simply busin esses with operations and interests in New Zealand 
that are affected by proposals.  Consultation with them occurs through peak bodies, industry associations or sometimes directly with individual businesses.   
 
Q3 According to the Secretariat's report, "Alt hough a comparison between the bound and applied 
tariffs is not possible because of differences in nome nclature and in types of duty in certain lines (e.g. 
binding in alternative specific or compound duty and applied rate ad valorem) mainly in textile and 
clothing…"  How, then, does New Zealand ensu re that applied rates do not exceed bound rates
?  Why 
did the Government change the duty type with respect to these lines? 
 Answer:
 
In New Zealand's unilateral review of post-2005 ta riffs, of the 7450 Tariff items then in the New 
Zealand Tariff, 195 tariff items carried alternative sp ecific rates.  This meant that the duty paid was 
calculated either by way of the alternative specific  rate (expressed in dollars and cents per unit) or 
the associated ad valorem rate - whichever rate returned the high est level of duty.  Government 
decided that these alternative specific rates should be  removed with effect from 1 July 2005 and the 
ad valorem rates remained the same, although subj ect to tariff reduction from 2006 to 2009.  No 
compound or alternative specific tariffs now exist and this will ensure that our applied rates do not 
exceed bound rates.  A report to the Minister of Commerce (available at:  http://www.med.govt.nz/templates/Multipage 
DocumentPage____14580.aspx#P1191_130263) provided the following reasons for removing 
alternative specific tariffs, namely: 
- Specific tariffs (including alternative specific tariffs) are an inefficient and non-
transparent means of protection;  
- The present alternative specifics regime enc ourages capital to be retained in low 
value-added products. Maintaining alterna tive specifics for remaining manufacturers 
who benefit from the regime acts as a disi ncentive to these firms to move up the value 
chain;  
- The New Zealand apparel industry has undergone major transformation over the last 
15 years.  Removal of alternative specifics would therefore impact on fewer manufacturers. The dumping concerns of the early 1990s appear to be of less 
importance to the apparel industry given the industry's move away from production 
which competes directly with low cost imports;  and  
- The removal of alternative specific tar iffs would result in approximately 20% of 
low-cost garments paying less duty which s hould flow through to price reductions for 
consumers.  Removal would be of particul ar benefit to lower socioeconomic groups WT/TPR/M/216/Add.1 
Page 64  
 
  who disproportionately bear the cost of the specific tariff - a higher percentage of the 
price paid for a clothing garment is the duty proportion.  
 
Q4 According to the Secretariat, "Major reviews of provisions affecting domestic and imported 
foods were initiated in 2003.  The two reviews have largely been completed and recommendations 
have been made to the Government.  The outcomes of both reviews will be developed into legislation 
that will put in place a food regulatory programme for the whole domestic food industry that takes a 
risk-based approach, provides for the comprehensiv e and targeted regulation of imported food, and 
ensures the delivery of safe and "suitable" food in New Zealand."   
Q4-1(a)  What did these two reviews (of imported and domestic foods) find?  
 
Answer:
 
The reports on both reviews were substantive an d have been published on the NZFSA website.  
Specifically for the domestic food regime there is conf usion about the role of the regulators involved 
in food safety (central and local government) and the need for regulatory intervention;  there is 
inconsistent controls in some areas and an in consistent regulatory impact on food businesses.  
 For domestic food the policy proposals can be f ound at:  http://www.nzfsa.govt.nz/policy-law/ 
projects/domestic-food-review/dfr-position-paper/index.htm.  
For the imported food review the report can be fo und at:  http://www.nzfs a.govt.nz/imported-food/ 
imports-portfolio/ifr-web-p lan-april07-reports.htm. 
 
Q4-1(b)   What aspects of the Gove rnment's findings require legisla tion in order for a food regulatory 
program "for the whole domestic food industry" to be put in place? 
 
Answer:
 
This relates to steps to harmonise the existing food legislation within New Zealand, including the Animal Products Act 1999 and the Food Act 1981 to remove duplication and improve the interface 
between them.  The above reports pr ovide further information on this. 
 Q4-1(c)  Why is imported food highlighted fo r "comprehensive and targeted regulation"? 
 
Answer:
 
As identified in the Imported Food Report (ref er link above) the current arrangements are not 
responsive enough and need improving. 
 
Q4-1(d)  Does the New Zealand Government plan to  subject imported food and domestic to the same 
risk-based analysis?    
Answer:
 
Yes.  All food sold in New Zealand, whether it is produced domestically or impor ted, will need to meet 
the New Zealand standard to ensure it is safe and suitable. 
 In doing so NZFSA is progressively toward furthe r removing traditional barriers to trade with more 
emphasis being placed on exporting country assurances (trust and confidence in the exporting party).  
Ultimately NZFSA see mutual recognition of food pr oduction systems with trusted trading partners as 
the ultimate recognition of this trust and mutual confidence.  For example shellfish export to 
New Zealand from the US need only to prove orig in US for import clearance (public health). 
  WT/TPR/M/216/Add.1 
 Page 65 
 
 
  Q4-1(e)  We are also interested in the Government's  goal to ensure the delivery of safe and "suitable" 
food in New Zealand.  How does the Government defi ne "suitable" in this context?  What, in the 
Government's view, constitutes a "suitable" food?  
Answer:
 
Suitability includes the compositi on, labelling, identification and condition of food but does not 
include matters that are directly related to food safety , or matters that are related to the food's quality 
requirements for commercial reasons.  It may include matters relating to the composition, such as the 
presence of a substance that would be unexpected or  unreasonable.  A suitable food is one that meets 
New Zealand's applicable food standards. 
 
Q4-2 The Secretariat Report states that "MAFBNZ, inter alia:   delivers economic, environmental, 
and social analysis underpinning biosecurity interventions; designs th e interventions and develops the 
standards to best manage risk s at the border;  clears incoming cargo from overseas;  and designs 
interventions and develops standards for the management of post-border biosecurity risks". 
 
The United States understands the importance of assessing biosecurity risks, and appreciates 
New Zealand's use of science-based analysis in deve loping standards to manage those risks.  Please 
explain what the "social analysis" underp inning biosecurity interventions entails. 
 
Answer:  
Social analysis underpinning biosecurity interven tions refers to the work undertaken to measure 
efficiency and effectiveness of communication of biosecurity interventions  and standards, and public 
compliance with those standards.  In New Zealand' s experience, this type of social analysis of 
biosecurity interventions is important in refining how the various tools available to us are used most 
efficiently to achieve the biosecurity outcomes sought. 
 Q5 The Secretariat's report states, "According to New Zealand's latest notification to the WTO, 
since 2004, Zespri Group Limited has been the only state-trading enterprise (STE) in operation in 
New Zealand;  this entity has special export authorit y, i.e. not accorded to other exporters of kiwifruit 
destined for markets other than Australia... None of the other state-trading enterprises notified in 
New Zealand's previous notification (in 2001) are now  STEs due to legislative changes."  We request 
that New Zealand promptly notify this and any ot her STEs in accordance with Article XVII of GATT 
1994 and the Understanding to the Wo rking Party on State Trading Enterprises, as it appears that New 
Zealand has not submitted a new and full notification on its STEs since 2004.  Can New Zealand please indicate when its 2006 and 2008 new and full no tifications will be submitted to the Working 
Party for Member review? 
 
Answer:
 
New and full notifications for STEs for 2006 and 2008 were submitted by New Zealand to the Working 
Party for Member review on 6 May 2009.  The se notifications were circulated to members on 
12 May 2009.  The document ref erences are G/STR/N/11/NZL and G/STR/N/12/NZL.  New Zealand is 
up to date with its notifications for STEs. 
 
Q6 According to the 2003 Secretariat report (WT/TPR/S/115), exclusions from patentability is 
one of the issues considered under a 2003 review of  the Patent Act 1953 prior to the introduction of 
the Patents Bill to replace the 1953 Act.  Could New Zealand comment specifically on what exclusions, if any, are being considered  as part of the pending legislation? 
 
Answer:
 
The Patents Bill, which has recently received its first reading in Parliament and has been referred to 
a Parliamentary Select Committee, provides fo r the following exclusions from patentability: WT/TPR/M/216/Add.1 
Page 66  
 
  - Inventions, the commercial exploitation of wh ich, would be contrary to public order 
or morality; 
- Human beings, and biological processes for their generation; 
- Methods of medical treatment of human be ings, and methods of diagnosis practiced 
on human beings; 
- Plant varieties. 
Further detail on the reasoning behind these exclusi ons can be found on the Ministry of Economic 
Development website at this address:  http ://www.med.govt.nz/templates/ContentTopic 
Summary____1317.aspx. 
 Q7 In its 2003 TPR, New Zealand indicated that  patent term restoration for pharmaceutical 
products due to regulatory delays was an area under re view.  Is there such a provision in the Patent 
Bill and if not, what was the reason for not including this provision?   
Answer:
 
The Patents Bill does not include a provision for pa tent term restoration for pharmaceutical products 
– the patent term is twenty years from the date of filing of a patent application, with no provision for 
extension. The question of patent term restoration for pharma ceutical products was reviewed in 2003.  A 
discussion document was released and submission s from interested parties were sought.  The 
discussion document can be found here:  http: //www.med.govt.nz/templates/MultipageDocumentTOC 
____1451.aspx.  After considering th e submissions, the government concluded that the likely costs 
would exceed the likely benefits and decided that no further work be carried out on this issue. 
 
Q8 According to the Secretariat's report, compulsory licenses in New Zealand are "not 
necessarily exclusive."  Does this mean that a compulsory license could be exclusive?  
 
Answer:
 
Section 46(4)(a) of the Patents Act 1953, provid es that any compulsory li cense issued under this 
section is not exclusive. 
 
Q9 The Secretariat report indicates that a review of the Plant Variety Rights Act was completed 
in 2003 and that a draft Plant Variety Rights Amendm ent Bill was prepared for public consultation in 
2005.  However, introduction of the Bill has been deferred until the Waitangi Tribunal has completed 
its report on the "WAI 262" Treaty of Waitangi Claim.   Can New Zealand indicate when this report is 
expected to be complete?  When does New Zeala nd expect the Plant Variety Rights Amendment Bill 
to be passed?    Answer:
 
At this stage it is not possible to say when the Waitangi Tribunal will complete its report on the 
WAI262 claims; consequently it is not possible to gi ve any indication of when the Plant Variety Rights 
Amendment Bill will be introduced. 
 Q10 The Secretariat report indicates that when passed, the Plant Variety Rights Amendment Bill 
will provide for enhanced rights for plant variet y rights owners, comparable with those provided 
under the 1991 revision of the UPOV Convention.  Can New Zealand comment on whether ratification of UPOV 1991 will occur once the Plant Variety Rights Amendment Bill has been enacted?    Answer:
 
Ratification of UPOV 1991 is likely to be consid ered once the Plant Variety Rights Amendment Bill 
has been passed. 
  WT/TPR/M/216/Add.1 
 Page 67 
 
 
  Q11 The Secretariat report indicates that compulsory  licenses for use of a design may be issued at 
any time after registration if an application is made  because the design is not applied in New Zealand.  
How does New Zealand ensure that protection is provided for industrial designs that are new or 
original?   Answer:
 
New and original designs may be registered under the Designs Act 1953.  Registration gives the 
proprietor of the registered design the exclusive ri ght to exploit the design.  New Zealand does not 
provide for an unregistered design right. Section 14 of the Designs Act 1953 provides for the issue of compulsory licenses over registered 
Designs.  The grounds for issue of a compulsory license are that the design is not being applied (used) 
in New Zealand.  Compulsory licenses cannot be issu ed over designs which have not been registered 
in New Zealand.  Few, if any compulsory licenses have been issued under section 14 of the Designs 
Act 1953. 
 Q12 According to the Secretariat, "The author ities may also use the design either free of any 
royalty payments or upon agreed terms with th e design holder."  How does New Zealand ensure 
adequate remuneration for any una uthorized use of a patent?  
 
Answer:
 
Section 16 of the Designs Act deals with the issue of Crown use of designs.  Section 16(2) gives the 
Crown the right to use the design free of royalties if: 
 i) The use occurs before the date of  registration of the design;  and 
 ii) The Crown has become aware of the d esign other than through communication of the 
design from the registered proprietor. 
 
Once a design has been registered, or if, prior to  registration, the design was communicated to the 
Crown by the proprietor, the Crown may only use the design on terms agreed with the proprietor.  
Any disputes will be decided through the Courts. 
 
Q13 According to the Secretariat's report (parag raph 117), New Zealand has decided to ratify a 
number of IPR related treaties since the last TPR.  Now that amendments to the Copyright Act have 
been implemented, does New Zealand have any plan s to join the WIPO "Internet Treaties" (WIPO 
Copyright Treaty and WIPO Performances and Phonograms Treaty)?    
Answer:
 
The Government has not yet considered the question of whether New Zealand should join the WIPO 
"Internet Treaties".  
Q14 What is the status of New Zealand's multi-year effort to try to regulate mobile termination rates?  When does New Zealand expect that  these rates will reach cost-oriented levels? 
 
Answer:
 
In New Zealand, the Commerce Commission is th e national telecommunications regulator with 
responsibility for undertaking investigations and making recommendations to the Government if it 
considers that regulation of a given telecommuni cations service is necessary.  The Minister 
responsible for telecommunications matters can then accept, reject or seek Commission 
reconsideration of the recommendations. 
 
In the period 2004-2006, the Commerce Commission studi ed the issue of fixed-to-mobile termination 
services (voice only), and in April 2006 recommended th at the Government regulate this form of 
mobile termination in a manner that would have b een cost-based (TSLRIC).  Under delegation from 
the Minister for Communications, the Minister of Economic Development rejected the Commission's WT/TPR/M/216/Add.1 
Page 68  
 
  recommendation in favour of Deeds Poll entered into  by the then existing mobile network operators, 
Telecom NZ and Vodafone.  These Deeds are legally binding commitments to reduce fixed-to-mobile 
termination rates and pass through the reductions to  retail customers.  The New Zealand Government 
considers that its actions were fully compliant w ith its international commitments, notably because 
the fixed-to-mobile rates agreed  in the Deeds Poll accorded with the Commerce Commission's 
assessment, at the time, of the likely evoluti on of fixed-to-mobile termination costs. 
 In the period 2008-2009, the Commission has been study ing the issue of mobile termination generally, 
including both fixed-to-mobile and mobile-to- mobile termination, and voice and SMS.  The 
Commission is due to make recommendations to the Government on each of these matters in 
December 2009.  Early indications are that the Commission will recommend cost-based regulation of 
all these forms of mobile termination, with immedi ate effect (i.e. without a glide-path).  Any such 
recommendations, if made, would then be subj ect to the agreement of the Minister for 
Communications, pursuant to Clause 6 of Schedule 3 of the Telecommunications Act, and then 
require a "standard terms determination process"  through which the Commission will define the 
precise terms of the regulation, including the exact price that apply. 
 In this context, if the Commission recommends, and the Minister accepts, cost-oriented mobile 
termination rates, we do not anticipate them entering into force before mid-2010.  
 
JAPAN
 
 
Q1 The Secretariat reports describes the Overse as Investment Act 2005 which will be reviewed in 
2009.  Please explain in which specific sector the G overnment of NZ expects the Overseas Investment 
Act to further promote overseas investment.  In ad dition, please indicate specific improvement to be 
made by the Government in the sector concerned.    Answer:
 
There is no specific sector in which the New Zealand government wishes to promote overseas 
investment.  The review of the Overseas Investment  Act has a general aim of making foreign 
investment in New Zealand simpler and more attractive. 
 
Q2 With regard to fish caught by NZ flag v essel in foreign waters, please indicate which country 
is regarded as the origin of such fish according to  the Customs Act in NZ.  In addition, please provide 
information on article of the Customs Act as the basis of this decision.   
 
Answer:  
Fish caught in foreign waters by New Zealand flagged vessels are deemed to originate in the relevant 
foreign country for the purposes of determining p referential or non-preferential rules of origin. 
 
Q3 Paragraph 55 in page 89 of the Secretariat report explains under the new regulation, in order 
to be licensed in New Zealand insurers (domestic  and foreign owned) will:  require minimum capital 
of NZ$2 million;  have to meet New Zealand actuarial  standards, etc.  Paragraph 57 in page 89 of the 
Secretariat report, however, notes that if foreign in surers are fully compliant with their home-country 
regulator's prudential requirements, the RBNZ will have discretion to accept compliance with these 
requirements and exempt these insurers from certain aspects of New Zealand's requirements.  In this regard, could NZ clarify whether requirements by ne w insurance regulation are not applied to foreign 
insurers which are fully compli ant with their home-country regul ator’s prudential requirements? 
 
Answer:
 
The Insurance regulations are still being finalised – for more detail please go to 
http://www.rbnz.govt.nz/fi nstab/nbdt/insurance/.  WT/TPR/M/216/Add.1 
 Page 69 
 
 
  ADDITIONAL WRITTEN QUESTIONS RECEIVED 
 
KOREA  
 
Q1 According to paragraph 69, New Zealand has been active in developing and promoting 
APEC's Regional Economic Integration agenda a nd the concept of a Free Trade Area of the 
Asia-Pacific (FTAAP).   Q1-1 What has been New Zealand's prev ious efforts to promote the FTAAP?  
 Answer:
 
Since the FTAAP concept was first broached by th e APEC Business Advisory Council and then by 
APEC Ministers and Leaders in 2006, New Zealand has worked with other APEC economies to develop the FTAAP concept and build a consensus about exploring it further.   
It has done this primarily by c ontributing to the various workstream s agreed by Ministers at the end 
of 2007 and implemented since then   These incl ude a study of the convergences and divergences 
among current FTAs and RTAs in the region, an invento ry of issues that would need to be considered 
before an FTAAP negotiation could be  launched, a study of current literature on the FTAAP concept, 
analysis of the benefits of an FTAAP and discussion about the alternative modalities for achieving an FTAAP including docking, merging or enlarg ing current FTAs or RTAs in the region. 
 
Q1-2 Does the New Zealand Government have speci fic plans to further promote the FTAAP?  If so, 
how?  
Answer:
 
New Zealand will continue to cooperate with other APEC members to implement the FTAAP work 
programme and explore how this work programme might  be further developed to deepen analysis of a 
possible FTAAP. 
 
Q2 According to the Secretariat Report, inward  FDI exceeded outward FDI between 2003/04 and 
2006/07.  However, New Zealand recorded a net outflow in 2007/08 due to a sharp increase in 
outward FDI and drastic decrease in inward FDI.   Could New Zealand further elaborate on the 
specific reasons for this net outflow in 2007/08?  
Answer:
 
New Zealand is a relatively small economy and individual instances of high value merger and 
acquisition activity can have significant impacts on the statistics.  This is the case for both foreign 
direct investment (FDI) into New Zealand, and Ne w Zealand direct investment abroad (NZDIA).  In 
the year ended March 2008, there were a number of si gnificant value acquisitions of overseas located 
enterprises by resident New Zealand direct investo rs, resulting in the relatively large outflow of 
NZDIA that year. The $4.2 billion inflow of FDI in 2008 followed the $12.5 billion inflow in 2007, the fluctuation 
reflecting relatively high levels of merger and acquisition and other activity by foreign direct 
investors in the 2007 year.  Comparing the main features of the $4.5 billi on outflow of NZDIA in the year ended March 2008, 
with the NZDIA of $2.2 billion in the March 2007 year: 
- 2008 saw significant merger and acquisition activity. A number of large value 
overseas located enterprises were acquired by  New Zealand resident direct investors. 
There was a lower level of this type of activity in the 2007 year. WT/TPR/M/216/Add.1 
Page 70  
 
  - During the 2008 year a number of resident direct  investors injected additional capital 
(equity and debt) into their overseas subsidia ries, preceded by a lower level of this 
type of direct investment abr oad activity in the 2007 year. 
- Retained earnings accruing to New Zealand resident direct investors from their 
overseas direct investees w ere higher in the 2008 year than in the 2007 year. 
 
Comparing the main features of the $12.5 billion inflow of FDI in the Ma rch 2007 year with the 
$4.2 billion inflow in the March 2008 year: 
- 2007 saw significant merger and acquisition activity.  A number of large and 
relatively small value New Zealand entiti es were acquired by non-resident direct 
investors.  The 2008 year saw lower l evels of this type of activity. 
- During the 2007 year a number of foreign di rect investors injected additional capital 
into their New Zealand subsidiaries, followed by  a lower level of this type of activity 
in the 2008 year. 
- Retained earnings fell in the 2008 year compared with 2007, reflecting higher 
distributions of dividends to foreign direct investors in 2008. 
 
Q3 It is stated that "all New Zealand legisla tion must be published and on sale at a reasonable 
price".  Furthermore, the related footnote states that it may be downloaded free of charge from the 
website www.legislation.govt.nz.  In relation to the above, could New Zealand further elaborate on 
the scope of "all New Zealand legislation"?  Does it only encompass legislation enacted by the 
legislature (Parliament), or includes any/all administrative orders issued by the executive 
government?  
Answer :
 
The www.legislation.govt.nz website includes the following legislation: 
- Acts of Parliament  
- Regulations  
- Bills (Government Bills, Members' Bills, Local Bills, and Private Bills)  
- Supplementary Order Papers (SOPs) 
 The website does not have: 
- Certain types of regulations (including some rules, codes, and other legislative 
instruments). Most of these are available free of charge on other websites.  
- Some types of decisions made under Acts (eg rulings, designations, or appointments) 
that are published in the Gazette  or in other ways by government organisations  
- Decisions of courts  
- International treaties and conventions (unless the text is set out in an Act or 
Regulation)  
- Local authority bylaws 
These are usually available on other websites.  
Q4 In regards to the "investor test",   
Q4-1 Could New Zealand further elaborate on what is the purpose of the "investor test"?  
Answer:
 
The purpose of the investor test is to determin e whether the investor has business experience and 
acumen, financial commitment to the investment, is  of good character and is not a person who would 
not be eligible for a permit or exemption und er New Zealand's immigration legislation. 
 
Q4-2 In judging "character, business acumen, le vel of financial commitment", what is the 
benchmark used?  WT/TPR/M/216/Add.1 
 Page 71 
 
 
  Answer:  
The Overseas Investment Office publishes detailed guidance for investors about the criteria they have 
to satisfy to meet these tests.  This is av ailable from www.linz.govt.nz/overseas-investment.  In 
addition, section 19 of the Overseas Investment Act 2005 and section 57I of the Fisheries Act 1996 set out the factors to be taken into account in assessing whether a person is of good character, and states 
circumstances when a person will be deemed to  be eligible for a permit or exemption under 
New Zealand's immigration legislation 
 
Q4-3 What measures are taken to ensure that the test is conducted in an impartial manner? 
 Answer:
 
The test is based on information provided by in vestors.  The Overseas Investment Office or relevant 
Ministers then make an assessment as  to whether the investor meets th e investor test in accordance 
with the guidance and legislation referred to in the previous question. 
 Q4-4 During the past 3 years, how many 'investors' were deemed 'inappropriate' investors?  What 
were the main reasons?  
Answer:
 
One application for consent was withdrawn by th e investor when the Overseas Investment Office 
discovered that the investor had a significant criminal record. 
 
Q4-5 What is the assessment on the benefits of  this test?  Has it produced positive results in 
weeding out inappropriate investors?  
Answer:
 
As noted above, this test ensures that investors in  sensitive New Zealand assets are of good character, 
do not have significant criminal records or terrorist  connections, have the necessary experience to 
manage any business and have the financial means to carry out the business.  
Q5 In regards to investment including "sensitive land", there is an additional requirement in the 
name of "significant benefits" for New Zealand.  As for fishing quota investments, there is a "national 
interest test". 
 Q5-1 Could New Zealand further elaborate on what  constitutes "significant benefits" and "national 
interest"?  Answer:
 
The factors for showing substantial and identifiable benefits and national interest are set out in the 
Overseas Investment Act 2005 and the Fisheries Act 1996. 
 
Q5-2 Is there a benchmark used to determine "significant benefits" and "national interest"? 
 Answer:
 
Each application is considered on its own merits, according to the factors set out in legislation. 
 
Q5-3 What, in general terms, is the ratio of "Number of applications to rejection"? 
 Answer:
 
Since 2001, 1993 applications have been decided und er the Overseas Investment Act.  98% of these 
applications have been approved.  No investments in significant business a ssets have been declined 
since 1984. 
 WT/TPR/M/216/Add.1 
Page 72  
 
  Q6 According to the Secretariat Report, the Ne w Zealand government adde d a new regulation to 
its 2005 Overseas Investment Act (OIA), enabling the OIO to maintain control of strategically 
important infrastructure on sensitive land.   Q6-1 What is the definition of "strategically important infrastructure"? 
 
Answer:
 
Strategically important infrastructure has not been defined. 
 
Q6-2 What are the specific criteria for determin ing 'strategically important infrastructure on 
sensitive land'?  What kinds of infrastructure do these standards apply to? 
 
Answer:  
See above. 
 Q6-3 Since its introduction, how many applications  have been rejected under the "strategically 
important infrastructure on sensitive land" criteria?  
Answer:
 
None. 
 Q7-1 Could New Zealand explain the rationale fo r performing pre-shipment inspections overseas 
for Japanese cars?  
Answer:
 
New Zealand seeks to mitigate the biosecurity risk associated with imported commodities offshore, 
where-ever possible.  Risk analysis has identified imported vehicles as a pathway for entry of a 
number of high impact organisms which are not establis hed in New Zealand.  Most vehicles imported 
into New Zealand come from Japan and this has ma de it practical for us to develop off-shore systems 
in Japan.  
Q7-2 Does New Zealand have plans to expand pr e-shipment inspections on automobiles in the 
future?  If so, what would be the crite ria under which such decision is taken? 
 
Answer:
 
New Zealand will seek the most effective and efficient  ways to implement biosecurity risk mitigation 
measures for the pathway.  Efficiency will be dete rmined in part by the number of vehicles from a 
particular source.  There are currently no pro posals to expand the pre-shipment inspection 
programme. 
 
Q8-1 In light of the tariff preference provide d under several bilateral trade agreements, and 
unilateral tariff preferences granted to many de veloping countries and LDCs, how many trading 
partners of New Zealand are subject to MFN tari ffs?  Could New Zealand provide a list of trading 
partners subject to MFN tariffs? 
 
Answer:  
In respect of trading partners exporting to New Zealand in the calendar  year 2008, 77 trading 
partners were not treated as less developed countries  nor least developed coun tries nor were subject 
to a free trade agreement with New Zealand.  Those trading partners are:  American Samoa;  
Andorra;  Antarctica;  Armenia;  Aruba;  Austria;   Azerbaijan;  Bahamas;  Bahrain;  Barbados;  
Belarus;  Belgium;  Bermuda;  Canada;  Caym an Islands;  Chinese Taipei;  Cyprus;  Czech 
Republic;  Denmark;  Estonia;  Faroe Islands;  Finland;  France;  French Guiana;  French Polynesia;  Georgia;  Germany;  Greece;  Guad eloupe;  Guam;  Hong Kong, China;  Hungary;   WT/TPR/M/216/Add.1 
 Page 73 
 
 
  Iceland;  Ireland;  Israel;  Italy;  Japan;  Kazakhstan;  Republic of Korea;  Kuwait;  Latvia;  
Liechtenstein;  Lithuania;  Luxembourg;  Macau, Ch ina;  Malta;  Martinique;  Moldova;  Monaco;  
Montenegro;  Netherlands;  Netherlands Antilles;  New Caledonia;  Northern Mariana Islands;  
Norway;  Poland;  Portugal;  Puerto Rico;  Qatar;  Reunion;  Russia;  San Marino;  Serbia;  Slovakia;  Slovenia;  South Africa;  Spain;  St Pi erre & Miquelon;  Sweden;  Switzerland;  Tajikistan;  
Ukraine;  United Arab Emirates;  United Kingdom;  United States;  Uzbekistan;  Virgin Islands 
(U.S).  
Q8-2 Could New Zealand provide further detail about the agreements with Canada and the 
United Kingdom referred to in paragraph 26?  Are these agreements in compliance with GATT 
Art. 24? 
 
Answer:
 
The preferences in both agreemen ts were grandfathered by virtue of Article I.2(a) of GATT as they 
were in force prior to GATT 1947 and are between GATT Annex A territories.   
 
The Trade Agreement between the Go vernment of New Zealand and the Government of Great Britain 
and Northern Ireland, with Appendix signed 12/08/19 59 and entered into force (retrospectively) from 
25/11/1958.  (This Agreement was terminated on 01/01/1999.  It superseded the Tariff Agreement 
between the United Kingdom and New Zealand , which entered into force on 20/08/1932 and was 
modified and supplemented by the  Trade Agreement between the Government of New Zealand and the 
Government of the United Kingdom , which was signed and entered into force on 28/05/1957.  The 
Trade Agreement between New Zeal and and Canada entered into fo rce on 24 May 1932 (superseded 
by the Agreement on Trade and Economic Cooperati on between the Government of New Zealand and 
the Government of Canada of 25 September 1981). 
 
The aim of the Agreement on Trade and Economi c Cooperation between the Government of 
New Zealand and the Government of Canada was to contribute to "the development and expansion of 
international trade through the re moval or reduction of barriers to trade' (preamble).  The Agreement 
contains Articles covering:  tariffs, rules of orig in, dumping and subsidies, non-tariff measures, and 
agricultural, horticultural and fishery products.  How ever, Article II confirms that nothing in the 
Agreement shall prejudice the rights and obligations  of either Party under the GATT.  The Agreement 
also provides for consultations on matters covered by  the Agreement to take place between the parties 
at the request of either.  The last such trade consultations took place in 2001.  The Trade Agreement between the Go vernment of New Zealand and the Government of Great Britain 
and Northern Ireland  aimed to "maintain mutually advantag eous tariff preferences and... facilitate 
and extend commercial relations" between the UK and NZ  (Article 1).  It covered duty on goods from 
NZ to the UK and margins of pref erence for NZ goods;  types of NZ goods to be imported without 
restriction into the UK until 31/05/1967;  margin s of preference for UK goods imported into NZ; 
consultation processes on any reductions in margins of preference by either party;  consultation 
processes with the UK if NZ remitted, reduced or temporarily suspended dut y on imports from other 
countries;  full consultation at government level  on agricultural production and marketing and on the 
UK's food import policies.  The Agreement also covers its application or n on-application to NZ 
dependencies and to then UK colonies etc.  
 
Q9 The report states that "New Zealand has moved from using the RVC method to primarily the 
CTC method" since 2003.  In this regard, 
 
Q9-1 Could New Zealand elaborate on why this decision was taken? Q9-2 What were the major considerations in making this shift? Q9-3 As of today, what is the assessment of New Zealand on the shift from RVC to CTC?  WT/TPR/M/216/Add.1 
Page 74  
 
  Answer:
 
New Zealand's moved to the Change of Tariff Cla ssification (CTC) approach to rules of origin 
because such approach has a number of distinct economic and trade-facilitatio n benefits; particularly 
in the context of increasingly globalised m anufacturing models.  These advantages include: 
- The ability to continually modify manufacturi ng practice in the face of changing cost 
structures and production efficiencies. 
- Predictability of outcome. 
- Lower transaction costs for business. 
- Lower administrative costs for governments. 
- The rules are fully transparent, and there is  far less scope for differences of opinion 
between business and officials administering the ROO. 
- CTC is increasingly becoming the international norm under FTAs. 
  It is New Zealand's experience that the CTC approac h has reduced the adminis trative burdens of both 
the government and business and business fee dback has certainly endorsed this approach. 
 Q10 The report states that for unilateral preferen ces, ROO require that at least 50% of value 
addition takes place in New Zealand or the exporting count ry.  On this item, is this rule applicable for 
all the unilateral preferences granted by New Zealand?  
Answer:
 
Assuming that "unilateral preferences" is referri ng to GSP and SPARTECA, i.e. non-reciprocal 
agreements then yes the rate is 50% based on an ex-factory cost calculation.  Under SPARTECA 
Forum Island Countries may use Australian content to help achieve the 50%.  If Australian content is 
used then there must be a Forum Island Country co ntent of at least 25%.  The apparel sector has a 
reduced threshold of 45%. 
 
Q11 Para 45 illustrates the MRAs conclude d by New Zealand.  In this regard, 
 Q11-1 Could New Zealand elaborate whether there is a particular criteria that it uses to select its MRA partner countries?  If not, how are MRA partner countries selected? Q11-2 As a follow up question, is there a criteria that it uses to select the areas(fields) for MRAs? 
 
Answer:
 
As New Zealand is highly reliant on trade, we ar e open to considering a wide range of trade 
facilitation arrangements with our trading par tners, embodying principles from regulatory 
cooperation through to mutual recognition or equi valence.  We consid er these arrangements where 
they are appropriate to the bilateral trade and where there would be mutual benefit to both parties.  
 Typically, we seek to achieve grea ter certainty of market access and reduced transaction costs for 
traders, as well as improved regulatory outcomes:  in particular, consumer safety.  In recent years, 
our approach has evolved to embrace a wide r ange of arrangements that provide both trade 
facilitation and enhanced regulatory compliance out comes, including some with asymmetric 
arrangements that best reflect and build on the strengths of trading partners' differing regulatory 
regimes.  
 
Q12 Could New Zealand further elaborate on the "marketing reasons" that has necessitated the need for export prohibitions/restrictions fo r some horticulture products and kiwifruit? 
 
Answer:
 
The perishable nature of unprocessed horticultura l produce and New Zealand's long distance from its 
key export markets necessitated the passing of the New Zealand Horticulture Export Authority Act 
1987 (the NZHEA Act) in 1987 to enable grow ers and exporters of horticultural produce to  WT/TPR/M/216/Add.1 
 Page 75 
 
 
  co-ordinate their marketing activities so that expor t products met the minimum quality standards set 
by the industries themselves and/or met importing co untry requirements.  No quantitative restrictions 
can be placed, in terms of number of exporters or the volume of exports, under the NZHEA Act.  The 
kiwifruit industry was regulated for similar reasons. 
 Q13 In the view of New Zealand, what is the r eason for the sudden surge in drawback and refund 
on duties between 2003/4 and 2007/8?  More exports in certain products such as knitted apparel and 
clothing, tobacco, etc.?   
Answer:
 
The increase in drawback and refund on duties be tween 2003/04 and 2007/08 reflects an increase in 
the FOB value of exports in certain products. 
 
Q14-1 Could New Zealand comment on the "polic y reversal" with regards to SOEs?  What 
considerations propelled this policy reversal?  
 
Answer:  
Changes of policy in relation to privatisation likel y reflect the differing approach brought in by a new 
Government at the time. 
 
Q14-2 Are there plans to privatize the re-nationalized SOEs? 
 
Answer:  
No. 
 Q14-3 With regards to para 99, could New Zeala nd elaborate on what concrete measures it has taken 
to ensure that SOEs operate as successful busin esses?  It is easy to say it should operate as a 
successful business;  taking concrete steps to ensure  that they do is another.  In this context, 
acquaintance with the New Zeala nd experience would be helpful. 
 
Answer:
 
There are three main components to help en sure SOEs do operate as successful businesses: 
- Structure:  SOEs have been set up as lim ited liability companies subject to the same 
legislation as private sector companies (the Companies Act). 
- Accountability:  boards of directors are held responsible for the operating decisions 
affecting the performance of the SOEs and are directly accountable to the 
shareholding Ministers for SOE performance. 
- Monitoring:  apart from the internal mon itoring by officials there is a two stage 
performance reporting process involving tw o publically available documents – the 
Statement of Corporate Intent (SCI) and th e Annual Report.  In particular, the SCI 
serves as a public performance contract between the SOE board of directors and 
shareholding Ministers.  It specifies the performance expected of the SOE for which 
the directors will be held accountable. 
 
Q15 Paragraphs 59 and 62 refer to the requirement of Telecom New Zealand to unbundle the local 
loop.  In this regard, has the unbundling begu n?  If so, could New Zealand provide detailed 
information on the procedures that were implemented to unbundle the local loop?  If not, what is the 
time-frame for initiation of this pro cess?  What will the procedure be? 
 WT/TPR/M/216/Add.1 
Page 76  
 
  Answer:
 
Local Loop Unbundling6 (LLU) has been implemented in New Zealand.  At the end of the 
September 2008 quarter there were over 12,000 unbu ndled lines in New Zealand, mostly in Auckland 
(New Zealand’s largest city).    
The 2006 Telecommunications Ame ndment Act introduced a number of regulated services including 
LLU, Sub-Loop Unbundling
7 (SLU), and Unbundled Bitstream Access8 (UBA).  Final determinations 
outlining the price and non-price terms at wh ich Telecom New Zealand must make LLU and UBA 
services available were made in late 2007.  A draft SLU determination was released in 
September 2008 and is expected to be finalised by the end of this year. 
 
Links to documents outlining the processes follo wed for making the LLU and UBA determinations 
are available on the following websites:  h ttp://www.comcom.govt.nz//IndustryRegulation/ 
Telecommunications/StandardTermsDetermina tions/UnbundledLocalLoopService/ContentFiles/ 
Documents/STD%20timeline0.pdf 
 
http://www.comcom.govt.nz//IndustryRegulation/ Telecommunications/StandardTermsDeterminations/
UnbundledLocalLoopBackhaulService/ContentFiles/Documents/Backhaul%20STD%20timeline.pdf 
 
An overview of the general pro cess for making determinations on regulated services is available at: 
http://www.comcom.govt.nz//IndustryRegulation/ Telecommunications/StandardTermsDeterminations/
ContentFiles/Documents/Overview%20of%20STD%20process0.pdf   
Further information on unbundled services in New Zeal and is available at the following websites: 
 Local Loop Unbundling
 
Standard Access Service 
http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
UnbundledLocalLoopService/DecisionsList1.aspx Co-location Service http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
UnbundledLocalLoopCoLocationService/DecisionsList.aspx  
Backhaul Service  
http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
UnbundledLocalLoopBackhaulService/DecisionsList.aspx   Unbundled Bitstream Access
 
Standard Access Service 
http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
UnbundledLocalLoopService/DecisionsList.aspx  Backhaul Service http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
UnbundledBitstreamBackhaulService/DecisionsList.aspx  
 
Sub-loop Unbundling
 
http://www.comcom.govt.nz/IndustryRegulation/Te lecommunications/Standar dTermsDeterminations/
SubloopUCLLservice/DecisionsList.aspx  
                                                      
6 LLU allows companies to provide services to  their customers from Telecom's exchanges. 
7 SLU allows companies to provide services to th eir customers from Telecom's distribution cabinets. 
8 UBA allows companies to offer own-branded broadband services to their customers over Telecom's 
Digital Subscriber Line (DSL) access lines.  WT/TPR/M/216/Add.1 
 Page 77 
 
 
  THAILAND  
 
Q1 Referring to paragraph 73 on page 55 of the report by the secretar iat, it is mentioned that tariff 
concessions may be granted to importers and manufact urers if they can demonstrate that the domestic 
content of the locally produced "suitable alterna tive" product is not less than 25% of its ex-factory 
cost of production.  Please kindly explain in more detail about this measure? 
 
Answer:  
In respect of reference 99 concessions (see paragrap h 29 on page 45 of the WTO Secretariat's TPR 
report), we confirm that concessions are granted where the domestic content of locally produced 
goods is less than 25% of its ex-factory cost of  production.  There are typographical errors in 
paragraph 10 on page ix, paragr aph 28 on page 44 and paragraph 73 on page 57 of the WTO TPR 
report, where references to "not less than 25%" of a good's ex-factory cost of production should refer 
to "less than 25%".  There are some additional  words in paragraph 73 on page 57.  The second 
sentence should read:  "However, tariff concession s may be granted to importers if the domestic 
content of the locally produced "suitable alternati ve" product is less than 25% of its ex-factory cost of 
production (section (2)(iii)(e)) above.  
Q2 Referring to paragraph 76 on page 56 of the re port by the Secretariat, it is mentioned that 
export prohibitions and restrictions are maintained fo r several reasons which are related to health and 
safety, compliance with international obligations under various agreements, management of trading 
partners' import requirements, and marketing.  Please kindly explain in more detail about "the 
marketing reasons" and give examples of horticultu re products which have been prohibited or 
restricted to export with these reasons?  
Answer:
 
The perishable nature of unprocessed horticultura l produce and New Zealand's long distance from its 
key export markets necessitated the passing of the New Zealand Horticulture Export Authority Act 
1987 (the NZHEA Act) in 1987 to enable grow ers and exporters of horticultural produce to 
co-ordinate their marketing activities so that expor t products met the minimum quality standards set 
by the industries themselves and/or met importing co untry requirements.  No quantitative restrictions 
can be placed, in terms of number of exporters or the volume of exports, under the NZHEA Act.  The 
kiwifruit industry was regulated for similar reasons. 
 Horticulture products which are regulated by the Horticulture Export Authority include:  avocado, 
blackcurrant, boysenberry, chestnut, kiwifruit (to Au stralia), nashi asian pear, persimmon, buttercup 
squash, summerfruit, tamarillo and truffles. 
 Q3 Referring to paragraph 12 on page 75 of the re port by the secretariat, it is mentioned that the 
Zespri Group Limited which is owned by kiwifruit gr owers, has been authori zed by the New Zealand 
Kiwifruit Board, to have the automatic, but not so le, right to export New Zealand grown kiwifruit to 
all markets (except Australia).  However, all other exporters must seek approval from the Board to be 
able to export kiwifruit in collaboration with Zespri , which effectively means that Zespri has a near 
monopoly on exports (for markets other than Australia).  
 
Q3-1 Please kindly explain how to ensure that end- users, both processors and consumers, have the 
opportunity to purchase kiwifruit at international competitive prices? 
 
Answer:
 
ZESPRI is a commercial entity and operates as su ch.  End-users (processors and consumers) all have 
an equal opportunity to purchase fruit from ZESPRI, or its competitors, in world markets.  Sales are 
limited by the seasonal supply window, and will depe nd on prices and quantities available for sale in 
any given season.   WT/TPR/M/216/Add.1 
Page 78  
 
  Within New Zealand there are no restrictions on eith er the buying of kiwifruit from growers or the 
wholesale marketing of kiwifruit to retailers for sale  and consumption on the do mestic market.  As far 
as pricing of kiwifruit purchased from growers is c oncerned, it is important to note that ZESPRI is a 
company owned and controlled by gr ower suppliers and the Board of directors is elected directly by 
the grower shareholders.  ZESPRI is limited in its  ability to leverage its monopsony power in the 
domestic market because it is owned by the grow ers.  There is no incentive on the company to 
underprice or overprice fruit purchased from growers or marketed on behalf of growers.  There are no tariff restrictions on the import of kiwifru it into New Zealand, and New Zealand consumers have 
the opportunity to purchase non-New Zealand kiwifruit.    
Q3-2 Please kindly explain how to ensure that the operation of Zespri does not create trade 
distortions to the world agricultural market.       
 
Answer:
 
ZESPRI receives no government payments nor any other form of financial assistance from 
government. It sells kiwifuit in international market s in competition with other countries.  There are 
no tariffs on kiwifruit and ZESPRI does not ha ve a monopoly on the domestic market - it cannot 
therefore, use any instrument to distort export markets.  
 
 
BRAZIL  
 
Q1 Although New Zealand has one of the lowest average MFN applied tariff rates in the OECD, 
at just 2.4% on the industrial products, a considerably high tariff rate is applicable to textiles, clothing 
and leather products, sectors of crucial export interest  to many developing countries.  Tariff peaks and 
escalation are also evident in these three sectors.  Does the governme nt intend to reduce tariffs in 
these sectors, and what are the plans to address tariff peaks and escalation? 
 
Answer:  
Tariffs of 12.5% currently apply to carpet, clot hing, certain footwear, ambulances and motor homes. 
Tariffs for these goods are subject to a unilat eral tariff reduction programme and under that 
programme the 12.5% tariff will reduce to 10% on 1 Ju ly 2009.  At this stage no decisions have been 
made about when or whether there should be a further unilateral tariff review. 
 
Q2 Could New Zealand please describe its vision of  liberalization and structural reform for the 
East Asia region, in light of the current regionaliza tion development.  Considering its desire to deepen 
the relationship with its partners in the East Asia and even Pan-Pacific regions, New Zealand's 
preference to implement its liberalization will be through a multilateral or a bilateral approach?  
 
Answer:  
New Zealand attaches top priority to multilatera l approaches to trade liberalisation including 
removal of non-tariff barriers.   
  At the same time we realise that regional bilatera l or plurilateral building blocks can contribute to a 
freer trading regime if they are comprehensive, WT O-plus and are committed to open regionalism.  
The AANZFTA is an example of the latter. 
 
New Zealand is working with others to advance A Comp rehensive Economic Partnership in East Asia 
(CEPEA), the Free Trade Agreement of the Asia Pa cific (FTAAP), as well as the Trans Pacific 
Partnership Agreement as mode ls of open regionalism. 
  WT/TPR/M/216/Add.1 
 Page 79 
 
 
  Q3 The Free Trade Agreement between New Zeal and and China was signed on 7 April 2008 and 
entered in force on 1 October 2008.  Which goods are included in import-sensitive manufacturing 
sectors?  When will those goods be phased out entirely? 
 
Answer:  
The New Zealand-China FTA provides China with im proved access to the New Zealand market but at 
the same time provides time for New Zealand's sen sitive sectors to adjust to tariff reductions. 
 The FTA tariff cuts are broadly consistent with ph ase outs under other FTAs.  All of China's exports 
to New Zealand will eventually be duty-free.  Specific outcomes include:  
- Tariffs on the most highly traded clothing and footwear products and some textile 
products will be phased out on a linear basis by 2016; 
- Tariffs on carpet, the remaining clothi ng, footwear products and certain highly 
traded textile products will be phased out on a linear basis by 2014; 
- The FTA provides for phase outs for tariffs in  the range of 6-12.5 percent by 2012. 
This includes products such as whiteware,  steel, plastics and furniture.  Some less 
sensitive textile and clothing products are also included in this category.  New Zealand has retained a slower initial ta riff phase out profile for particular steel 
and whiteware products to ensure that tariff reductions under the FTA go no faster than under the unilateral tariff reduc tion programme through to 2009. 
 
The following table provides a summary of New Zealand’s elimination of tariffs. 
 
Summary of New Zealand's Elimination of Tariffs  
Date for Tariff Elimination Percentage of Current 
Imports Key Import Products 
2008* 38.5 37% of trade is already duty free 
2012/2013 35.5 Steel, whiteware, plastics,  furniture, tyres, plasterboard 
2014 4.5 Clothing, f ootwear, carpets and some textiles 
2016 21.5 Clothing and footwear 
 
For more information on tariff reduction rates, pl ease refer to pp.16-25 of the Guide to the New 
Zealand-China Free Trade Agreement.  
 
Q4-1 How many tariff lines are covered by New Zeala nd's GSP?  What is thei r share in total tariff 
lines? 
 Answer:
 
All tariff lines are duty free for imports from least developed countries.  As at 1 July 2008, the GSP 
scheme for less developed countries applied to 327 ta riff lines, which represented 4% of tariff lines 
(10.6% of dutiable tariff lines) for the reasons explained in paragraph lll.27 of the Secretariat's 
report. 
 
Q4-2 What are the top ten beneficiaries of the New Zealand's GSP, and what are their respective 
shares in preferential imports?  How have their shares developed during the last five years? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q5 It is stated that Article 15.8 of the ANZCERT A allows one member state to request the other 
to take action against alleged dumping by a third country.  Has a member state of ANZCERTA ever 
requested another member state to examine the pos sibility of taking such action?  Please, indicate WT/TPR/M/216/Add.1 
Page 80  
 
  what kind of evidence should be presented by the requesting member state and the procedure that 
should be followed in this kind of exam.  Answer:
 
Australia has requested that New Zealand examine the possibility of taking action on 4 occasions.  
New Zealand has never requested that Australia examine the possibility of taking action.  
New Zealand legislation relating to dumping and countervailing, the Dumping and Countervailing 
Duties Act 1988, requires that the evidence to be prov ided in a third country dumping application is, 
with all necessary modifications, the same as that  for a normal dumping application by an industry 
located in New Zealand.  The evidence relating to dumping, material injury and causal link is therefore examined in the same manner as for a normal dumping application. 
 
Q6 As mentioned in the document above, "bet ween 2002/03 and 2007/08, the services sector 
grew at an average annual rate of 3.9%, slightly f aster than GDP growth.  Consequently, the share of 
services in GDP remained static (at around 70% between 2002/03 and 2004/05), while its share of 
total employment increased (from 69.4% in 2003/04 to  70.5% in 2006/07).  Within services, finance, 
insurance, and business services, and wholesale and retail trade are the two largest categories, 
accounting for 14.4% and 12.9% of GDP, respectively,  in 2004/05 (Table I.2).  Between 2003/04 and 
2007/08, services exports grew to NZ$12.7 billion (appr oximately 26% of total exports of goods and 
services (Table I.4), while imports grew at an average annual rate of approximately 4.6% to 
NZ$12.5 billion, resulting in a decrease in the services surplus to NZ$0.5 billion.  Travel, education, 
transport and business services have been the main services exports, but the range of exported services has diversified in recent years."  Could New Zealand provide further information regarding 
the main imported services?  What are those sector s and most important suppliers?  Regarding the 
importing sectors, has New Zealand made full and comprehensive commitments on market access and national treatment to all four GATS modes of supply? 
 
Answer:
 
The main imported services are travel and transporta tion. The growth in total imports of services 
from 2003/04 to 2007/08 was driven by increases in th ese two categories, with travel being the most 
prominent.  Travel services, which measures spending by New Zealand residents abroad, was up 46% 
from $2,900m in 2003/04 to $4,227m in 2007/08.  Transportation services was up 17% from $3,470m 
in 2003/04 to $4,057m in 2007/08.  There is no country information available for these two services 
categories.  
 
Of the other services categories, the main increases from 2003/04 to  2007/08 were in computer and 
information services, construction, and management  consultancy services and management fees. 
Growth in these categories has been driven by im ports from Australia and the USA.  Please see 
table 13 of the Balance of Payments and Inter national Investment Position:  Year ended 
31 March 2008 release for a fuller picture. 
 
New Zealand has an open economy and imports a r ange of services across a variety of sectors.  
New Zealand has strong existing UR commitments across key service secto rs, (eg. travel - 
incorporating tourism/education related travel, transportation, construction and business services).  
In addition, our current revised off er includes improved commitments in a range of business services 
(including management consultancy and computer & related services), cons truction and transport.  
These commitments are offered with no limitations a cross modes 1-3, and in conjunction with an 
improved mode 4 offer.  
Q7 Regarding the Australia-New Zealand Cl oser Economic Relations Trade Agreement 
(ANZCERTA), both countries are working toward the development of a Single Economic Market 
(SEM).  What are the most recent achievements ?  How does the SEM affect New Zealand's trade 
negotiations?  WT/TPR/M/216/Add.1 
 Page 81 
 
 
   
Answer:  
New Zealand and Australia share the long-term  goal of a trans-Tasman Single Economic Market 
(SEM) to reduce the impact of borders on the flow of  goods, services, capital, and people;  to improve 
the business environment; and to enhance regulatory e ffectiveness.  Recent achievements of the SEM 
include the signing of a treaty on Court proceedings  and regulatory enforcement, the entry into effect 
of a world-leading regime on the mutual recognitio n of securities offerings, and an ambitious work 
programme under the Memorandum of Understanding on  the Coordination of Business Law aimed at 
tackling business regulation in both countries. Ne w Zealand and Australia are also currently engaged 
in work in the following areas, with a view to  early conclusion: a Double Taxation Agreement, a 
Memorandum of Understanding on the Portability  of Retirement Savings, a review of the 
trans-Tasman Mutual Recognition Arrangement, streamlining insolvency regulations in both 
countries, and a CER Investment Protocol.  
With both CER and now the SEM, it was always intended that both Australia and New Zealand would 
continue to liberalise trade unilaterally, mu ltilaterally through the WTO, and through Free Trade 
Agreements with other trade partners.  To that e nd, while the SEM remains an important plank in 
New Zealand's work toward an improved trading environment, New Zealand's other trade 
negotiations, both multilaterally through the WTO and bilaterally through FTAs continue unaffected, 
and will continue to do so. 
 
Q8 Could New Zealand indicate the coverage in  both trade value and tariff lines of the ASEAN-
Australia-New Zealand Free Trade Agreement (A ANZFTA)?  Could New Zealand describe the 
schedules of concessions by percentage levels? 
 Answer:
 
The percentage of New Zealand's exports to other AA NZFTA Parties, subject to tariff elimination, as 
well as the percentage of tariff lines eliminated by  each Party under the AANZFTA is outlined in the 
table below.  
New Zealand and Australia have committed to the elimination of 100% of tariffs under the AANZFTA.   
 
Country Coverage of NZ Ex ports on Eliminated Lines Tariff Lines Subject to Elimination3 
Brunei Darussalam1 100% 99% 
Cambodia 86% 88% 
Indonesia 99% 93% 
Laos 2 88% 
Malaysia 99% 96% 
Myanmar 99% 85% 
Singapore 100% 100% 
Thailand 100% 100% 
The Philippines 99% 95% 
Viet Nam 99% 90% 
 
1 The agreement covers all of Brunei Darussa lam's tariffs except for a short list of pr oducts (alcohol, tobacco, and firearms) th at 
are exempted on moral, human health, and security grounds. 
2 Recent import data from Laos is not available and a matching of  export data to Laos' tariff data has not been performed. 
3 Either immediately or via phasing.  
 
Q9 According to the WTO Secretariat Repor t, trade negotiations are underway between 
New Zealand and the Gulf Cooperation Council (GCC ).  Could New Zealand elaborate more on the 
main elements of the agreement and indicat e its coverage and schedules of concessions? 
 WT/TPR/M/216/Add.1 
Page 82  
 
  Answer:
 
New Zealand commenced negotiations with the Gulf  Cooperation Council in July 2007.  Five rounds 
of negotiations have been held to date.  In accordance with New Zealand's usual approach to FTA 
negotiations, New Zealand is seeking a high-quality and comprehensive outcome covering goods, 
technical barriers to trade, rules of origin, cu stoms procedures and cooperation, SPS, services, 
investment, government procurement, intellectual pr operty, competition policy, trade and labour, and 
trade and environment.  
Q10 Have the FTA negotiations th at were being considered be tween New Zealand and Korea, 
New Zealand and Japan, New Zealand and India been launched?  What is the current status of each 
one of them? 
 
Answer:
 
New Zealand Trade Minister Tim Groser and India's then-Commerce and Industry Minister Kamal Nath announced in February this year that, subject  to the approval processes of both governments, 
FTA negotiations would commence as soon as possi ble.  The New Zealand Cabinet has now agreed 
(30 March 2009) to enter into FTA negotiations with India, subject to India's own approval processes.  
If the Indian Cabinet also approves entry into  negotiations, it is hoped that these will commence 
sometime in the latter half of this year.  
New Zealand and Korea will hold a first round of  talks in Seoul from 8-12 June 2009. 
 New Zealand's long term objective remains to conc lude a bilateral FTA with Japan.  Former Prime 
Ministers Clark and Fukuda met in May 2008 and ag reed to undertake an authoritative joint study 
into a bilateral EPA. A joint Officials Group has been established to examine the Japan-New Zealand 
bilateral trade and economic relationship.  It is  New Zealand’s expectation that the Officials Group 
process will provide both governments with the inform ation they need to deci de whether to move to 
EPA negotiations in the future. 
 
Q11 The TPR mentions that New Zealand has redu ced its specific rates from 165 to only 6, and 
that it has extinguished the alternative specific tari ff.  Could New Zealand elaborate on the rationale 
behind this process (changes to ad valorem rates)?  Is  there any intent to tota lly eliminate the specific 
tariffs?  The applied tariffs on "parts and component s of machinery, appliance or equipment for which 
they have been designed" (Page 38, Paragraph 21, WT/TPR/216) do not seem to be clear, considering 
that its ad valorem rates seems to vary too much (32 levels of rates ). 
 
Answer:
 
In New Zealand's unilateral review of post-2005 ta riffs, of the 7450 Tariff items then in the 
New Zealand Tariff, 195 tariff items carried alterna tive specific rates.  The Government decided that 
these alternative specific rates s hould be removed with effect fr om 1 July 2005 and the ad valorem 
rates remained the same, althou gh subject to tariff reduction from  2006 to 2009.  No compound or 
alternative specific tariffs now exist.    A report to the Minister of Commerce (available at:  http://www.med.govt.nz/templates/Multipage 
DocumentPage____14580.aspx#P1191_130263) provided the following reasons for removing 
alternative specific tariffs, namely: 
- Specific tariffs (including alternati ve specific tariffs) are an inefficient and 
non-transparent means of protection;  
- An alternative specifics regime could en courage capital to be retained in low 
value-added products.  Maintaining a lternative specifics for remaining 
manufacturers who benefit from the regime ac ts as a disincentive to these firms to 
move up the value chain;   WT/TPR/M/216/Add.1 
 Page 83 
 
 
  - The New Zealand apparel industry has undergone major transformation over the last 
15 years.  Removal of alternative specifics would therefore impact on fewer manufacturers.  The dumping concerns of the early 1990s appear to be of less importance to the apparel industry given the industry's move away from production 
which competes directly with low cost imports;  and  
- The removal of alternative specific tar iffs would result in approximately 20% of 
low-cost garments paying less duty which s hould flow through to price reductions for 
consumers.  Removal would be of particul ar benefit to lower socioeconomic groups 
who disproportionately bear the cost of the specific tariff – a higher percentage of the 
price paid for a clothing garment is the duty proportion.  
  
At this time there is no intent to remove the remain ing 6 specific tariffs although the specific tariffs on 
6309.00.01 (Worn clothing) and 630 9.00.11 (Worn Footwear) will reduce on 1 July 2009, under the 
current unilateral tariff reduction programme.    
There are 32 tariff lines (not 32 levels of rates) whic h apply 'the rate applicable to the appliance or 
apparatus for which the parts have been designed'.  If the (parent) appliance or apparatus has a rate 
of duty of Free, it is only fair that the parts attract the same rate.  Similarly,  if the (parent) appliance 
or apparatus has a rate of duty of 5%, it is only fair  that the parts attract the same rate.  We believe 
that this is a fair and consistent approach.  
Q12 What percentage of imports of New Zeala nd is covered by goods and services from Less and 
Least developed countries supporte d on preferential trade tariffs? 
 Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.   
CHINA
 
 
Q1 According to the report, "No import restricti ons, prohibitions or licensing requirements are in 
place.……";  "New Zealand has no barriers to exports……. ".  However, in Para. 11, "Details required 
for clearance of goods include: …permits for goods subject to import restrictions".  Could 
New Zealand please clarify the scope and covera ge of permits for goods subject to import 
restrictions?  
Answer:
 
Information on import prohibitions and restrictions  that the New Zealand Customs service enforces at 
the border is contained in Customs Fact Sheet Number 5, available from www.customs.govt.nz/ 
library.  
 
Q2 According to the Report, "New Zealand Cust oms Service makes extensive use of electronic 
data interchange (EDI) to speed up clearance times,  promotes "tomorrow cargo logistics" by working 
with companies, and participates in single window  initiatives aimed at developing and implementing 
single windows.  The NZCS has a performance ag reement with the New Zealand Government 
requiring compliant EDI applications for import and export to be processed within 30 minutes; 
manual applications are processed within 24 hours.  According to the author ities, this target is 
achieved in around 99.5% cases (99.3%  in March 2008), with an aver age turnaround of 7 (previously 
12) minutes.  All of New Zealand's import and e xport entries appear to be handled by EDI." 
 
Q2-1 Could New Zealand please clarify whether el ectronic documents are legally binding in the 
extensive use of EDI to speed up clearance times?   WT/TPR/M/216/Add.1 
Page 84  
 
   
Answer:
 
It is an offence against the Customs and Excise Act 1996 to submit an entry declaration that is erroneous in a material particular.   
 Q2-2 For Goods subject to import and export rest rictions, are paper licenses also required?  How 
long is the time needed for the clearance of im port and export goods subject to licensing?   
 
Answer:
 
Customs' enforcement of import and export prohibitions  is largely intelligence driven, using alerts on 
its computer system for specific goods covered by impor t or export prohibitions.  For the majority of 
goods covered by import and export pr ohibitions, the alert triggers a requirement for the importer or 
exporter to enter a code and approval number on the en try declaration.   In a limited number of cases 
(for example firearms, explosives, hazardous waste and ozone depleting subst ances) a hard copy of 
the approval to import or export will be required. 
 Q3 According to the Report, "Tariff concessions are granted whenever suitable alternative goods 
are not available from local producers and manufactu rers or the domestic content of the locally 
produced item is not less than 25% of its ex-factor y cost of production."  Could New Zealand please 
clarify what is the relevance in granting tariff con cessions with regard to suitable alternative goods not 
locally available and how to define the relevance between the two?  Please provide more up-to-date 
information with regard to the real experiences in  granting tariff concessions in this area and please 
use examples to illustrate.    
Answer:
 
We confirm that tariff concessions are granted wh ere the domestic content of locally produced goods 
is less than  25% of its ex-factory cost of production.  There are typographical errors in paragraph 10 
on page ix, paragraph 28  on page 44 and paragr aph 73 on page 57 of the WTO TPR report, where 
references to "not less than 25%" of a good's ex-fa ctory cost of production should refer to "less than 
25%".   Suitable alternative goods are defined as those whic h perform the same or a similar function to the 
imported goods for which a concession is s ought; and where the imported goods would compete 
directly in the same market.  Price and quality  are not normally taken into consideration. 
 As an example, an imported glass melting furnace could be granted a tariff concession if glass 
melting furnaces are not available from New Zeal and manufacturers.  Similarly, a glass melting 
furnace could be granted a tariff concession if gl ass melting furnaces were to be manufactured in 
New Zealand but they had less than 25% local content (represented by New Zealand sourced 
materials, wages and factory overheads).  An im ported glass melting furnace would not, however, be 
granted if glass furnaces were  manufactured in New Zealand with 25% or more New Zealand 
content.  
Q4 According to the Report, "certificates of origin, although not a prerequisite to entry under 
preferential agreements, may form part of the impor ter's evidence presented to Customs if claim of 
preferential entry is challenged" .  Could New Zealand please clarify the criteria by which goods 
entitled for preferential entry are determ ined and what are the procedures? 
 Answer:
 
The criteria and procedures by which goods are entitle d for preferential entry are laid out in the 
relevant sections of New Zealand's preferential tr ade agreements.  Preference can be claimed via 
self-declaration on an import entry.  A claim for pr eference may then be verified during a post-entry 
audit process.  WT/TPR/M/216/Add.1 
 Page 85 
 
 
   
Q5 According to the Report, "Telecom New Zealand was required to divide its operations into at 
least three different units:  a network business that  sells access to the copper network on an equal 
basis to Telecom New Zealand and other operators; a regulated wholesale business that sells wholesale broadband access services on the same conditions to Telecom New Zealand's retail 
subsidiaries and other competitors; and one or more  retail business units".  Could New Zealand please 
indicate the rationale of this division requirement?  
Answer:
 
The operational separation of Telecom was required by Parliament via the 2006 amendment to the 
Telecommunications Act 2001, which sets out  the purposes of operational separation: 
- To promote competition in telecommunicati ons markets for the long-term benefits of 
end-users of telecommunication services in New Zealand;  
- To require transparency, non-discrimination, a nd equivalence of supply in relation to 
certain telecommunications services;  and  
- To facilitate efficient investment in te lecommunications infrastructure and services.  
 Separation will increase the transparency of Teleco m's business operations, and remove or limit the 
incentives and ability of Telecom to engage in dis criminatory behaviours that lessen, damage or 
exclude competition in downstream markets.   
Further information on the operational separation of Te lecom is available at the following website:  
http://www.med.govt.nz/templates/C ontentTopicSummary____26310.aspx. 
 
Q6 Could New Zealand please indicate the relationship between these three units?  Are they 
separate subsidiaries, branch es or other business forms? 
 
Answer:
 
The Access Network Services unit must operate as  a stand-alone (separately branded) arms-length 
unit.  This unit has subsequently  been branded "Chorus" by the Te lecom Group (www.chorus.co.nz).  
Chorus controls all of Telecom's present and fu ture access network assets,  including fibre and 
wireless access assets, and must make these networ k assets available for ot her telecommunications 
providers to use on an Equivalence of Inputs (EOI) basis9. 
  The Wholesale unit must operate at arms-length fr om the Retail unit (i.e. it must provide relevant 
regulated services on an EOI basis), and the Retail un it must operate at arms  length from any fixed 
network business. 
 
                                                     
 
9 EOI is one of the cornerstones of operational separation as it removes the ability of Telecom to 
discriminate in favour of itself.  It means that Teleco m has to provide relevant regulated services at the same 
price, on the same technical and commercial terms, using the same operational support systems and process, to 
all market participants including itself.  Telecom does not have to provide relevant non-regulated services to other providers other than on a voluntary basis, but if it chooses to do so it must be on a non-discriminatory 
basis. WT/TPR/M/216/Add.1 
Page 86  
 
  The diagram below illustrates the new operating model: 
 
 
 
Further information on the operational separation of Telecom is available at the following website:  
http://www.med.govt.nz/templates/ ContentTopicSummary____26310.aspx. 
 
Q7 According to the Report, "the cost of mob ile usage in New Zealand remains higher than the 
OECD average, which is due in part to high mobile-t o-mobile termination rates.  Another factor that 
inhibits competition is that the two incumbent mark et operators use different technologies so that 
switching operators entail the extra cost of a hand set."  Could New Zealand please indicate whether it 
has any plan to allow more compe tition in the mobile business operation? 
 
Answer:  
New Zealand mobile telecommunications market is  fully open to competition.  The Government 
expects competition in the mobile telephony sector to  increase in the coming months, for the following 
reasons:  
- A third mobile network operator, branded “ 2degrees”, has indicated that it will enter 
the market in August 2009.   
- The mobile network operator using the l ess popular CDMA technology, Telecom New 
Zealand, launched a W-CDMA / HSDPA network in May 2009, and intends to switch 
off its CDMA network by 2012: all three operators will thus be using the same 
technology.  
 
The telecommunications regulator is due to make recommendations to the Minister for Communications in December 2009 in respect of mobile termination;  depending on the nature of 
these recommendations, and the Minister's decision th ereon, mobile termination rates may fall, and 
retail price reductions may follow.  WT/TPR/M/216/Add.1 
 Page 87 
 
 
   
Q8 According to the Report, "fixed-line prices in New Zealand are high compared with other 
OECD countries due to high line rentals and fi xed-to-mobile calling charges through lack of 
competition".  Could New Zealand please indicate whether it has any plan to allow more competition in the fixed-line business operation? 
 
Answer:
 
Due to New Zealand's different servi ce structure for fixed-line services (e.g. requirements to offer free 
local calling), comparisons with other OECD count ries have always been particularly difficult to 
make, and alternative analyses would rank New Ze aland better if these unique features were taken 
into account.  Nevertheless, in recent years the New Zealand government has introduced measures to 
promote competition in the fixed-line market.  New Zealand’s fixed-line telecommunications  market was fully opened to competition on 
1 April 1989.  However due to the dominance of  the incumbent operato r (Telecom New Zealand) 
competition in the fixed-line market was slow to d evelop.  The introduction of the Telecommunications 
Act 2001 and the Telecommunications Amendment Ac t 2006 sought to introduce measures to limit 
Telecom's ability to act anti-competitively and ther efore encourage competition in the fixed-line 
market.  Such measures included loca l loop unbundling and the operational  separation of Telecom.   
 There are encouraging signs that competition in the fi xed-line market is developing, with over 19% of 
fixed access lines being retailed by providers other than Telecom for the 2007/08 financial year (up 
from 11% the previous financial year).  
Q9 According to the Report, "foreign investment s are not screened unless they would result in the 
acquisition of 25% or more ownership of, or a c ontrolling interest in, significant business assets (or 
the establishment of a significant business asset), sensitive land or fishing quota.  "Significant 
business assets" are shares or assets valued at mo re than NZ$100 million".  It is read that the 
definition of "significant business assets" is partly based on the value of shares.  Could New Zealand clarify whether this definition takes into account the fl uctuation of the value of shares?  If so, how is it 
done?  Answer:
 
The definition applies where the value of the securities or consideration provided, or the value of the 
assets of A or A and its 25% or more subsidia ries, exceeds $100 million. Hence changes in the value 
of shares, in relation to a particular transaction involving the acquisition of shares, could affect 
whether that investment is screened. 
 Q10 Could New Zealand please describe the definition of "controlling interest"? 
 
 Answer:
 
The Overseas Investment Act 2005 uses the concept of "25% ownership or control interest".  A person 
(A) has a 25% or more ownership or control interest in another person (B) if A has— 
 (a) a beneficial entitlement to, or a beneficia l interest in, 25% or more of B's securities; 
or 
 (b) the power to control the composition of 25 % or more of the governing body of B;  or 
 (c) the right to exercise or control the exerci se of 25% or more of the voting power at a 
meeting of B. 
 Q11 According to the Report, "In March 2008, th e Government made a change to the Overseas 
Investment Regulations 2005 that allowed Ministers to consider control of "strategic infrastructure 
assets" when determining whether an investment in  sensitive New Zealand land will provide a benefit 
to New Zealand".  Could New Zealand please identify exactly which Ministers are referred to here? WT/TPR/M/216/Add.1 
Page 88  
 
    
Answer:
 
The Ministers of Finance and Land Information a re the Ministers which take decisions on investments 
in sensitive land.  
Q12 Could New Zealand please describe the defin ition of "strategic infrastructure assets"? 
  
Answer:
 
The change to the regulations made in March 2008 added another factor that Ministers may take into account in assessing whether an overseas investment in  sensitive land will, or is likely to, benefit New 
Zealand.  The new factor was whether the overseas invest ment will, or is likely to assist New Zealand 
to maintain New Zealand control of strategically im portant infrastructure on sensitive land.  The term 
"strategically important infras tructure" has not been defined. 
 
Q13 Could New Zealand please explain in greater de tail the concept of "benefit" in this context? 
 
Answer:
 
One of the criteria for consent for overseas investments in sensitive land is that the investment will, or 
is likely to, benefit New Zealand:  section 16(1)(e)(ii) of the Overseas Investment Act 2005.  If the land is non-urban and more than 5 hectares in area, th e benefits must be, or must be likely to be 
"substantial and identifiable":  section 16(1)(e)(iii).  The factors for assessing the benefit of an 
investment in sensitive land are set out in sec tion 17 of the Overseas Investment Act 2005 and the 
Regulations.  
Q14 Has this change been notified to the WTO?  If so, please indicate the document reference of 
the notification; if not, is there any plan to make the notification? 
 
Answer:
 
No, this change is consiste nt with our WTO obligations. 
 
Q15 Could New Zealand please provide  the rationale for this change? 
 Answer:
 
The additional factor was introduced by the previ ous Government to allow Ministers to consider 
whether an investment in sensitive land will or is likely to assist New Zealand to maintain New Zealand control of strategically im portant infrastructure on sensitive land. 
 
Q16 Please provide information on the policies a nd measures New Zealand has adopted in recent 
years to promote employment, including fi nancial, taxation and monetary policies. 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 Q17 Are there any specific regulations with regard  to advanced technologies and related products?  
If yes, please provide a list of the regulations a nd indicate how they could be accessed including via 
website.  Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.   WT/TPR/M/216/Add.1 
 Page 89 
 
 
  Q18 In aviation sector, New Zealand has set three qualifications for foreign investment, which are 
ownership, equity and cap on all foreign invest ment.  Please clarify the three qualifications and 
provide relevant details. 
 
Answer:  
There are two limitations in regard to th e ownership of Air New Zealand shares: 
- Limitation on Airline Ownership: No person that owns or operates an airline 
business may hold or have an Interest in an Air New Zealand Equity Security unless 
the prior written consent of the Crown (in its  capacity as Kiwi Shareholder) has been 
given to such holding. 
- Limitation on Ownership by Non-New Zeal and Nationals: No person who is not a 
New Zealand National may hold or have an Interest in Air New Zealand Equity Securities which confer 10 percent or more of the total Voting Rights for the time 
being unless the prior written consent of  the Crown (in its capacity as Kiwi 
Shareholder) has been given to such holding or Interest. 
 
 THAILAND – Add 2
 
 
Q1 Referring to paragraph 31 on page 15 of the re port by the Secretariat, it is mentioned that 
budgetary funding for training and education  has been increased, as ha ve tax incentives, while 
budgetary expenditure is focused on projects ai med at removing infrastructure bottlenecks and 
capacity constraints.  Q1-1 Can foreign investors do trai ning and education business in New Zealand?  Are tax incentives 
also given to investors in this business? 
 
Answer:
 
It is possible for foreign investors to invest in  training and education businesses in New Zealand, and 
to set up private training establishments, as long as they meet the quality assurance criteria specified 
by the NZ Qualifications Authority.  The investment  would be subject to screening under the Overseas 
Investment Act, if it is a significant business as set or includes sensitive land.  There are no tax 
incentives for investing in such businesses.  
Q1-2 Are tax incentives equally given to domestic  and foreign-owned companies in any business 
categories?  If not, please explain.   Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q2 Referring to paragraph 55 on page 32 of the report by the secretariat, it is mentioned that 
Overseas persons are expected to pass an investor test  that considers character, business acumen, and 
level of financial commitment.  Furthermore, they must also show that the investment will provide 
significant benefits for New Zealand if it includes sensitive land. 
 Q2-1 Please explain in more detail the "investor test".  Answer:
 
The investor test is set out in sections 16(1)(a to (d) [sensitive land], section 18(1)(a) to (d) 
[significant business assets] of th e Overseas Investment Act 2005 and section 57G(1)(b) to (e) of the 
Fisheries Act 1996.  WT/TPR/M/216/Add.1 
Page 90  
 
  Q2-2 Please clarify the term "significant benefits".   What are the criteria for determining whether 
overseas investment will provide significant benefits for New Zealand?     
Answer:
 
The criteria are set out in section 16 of the Overseas Investment Act and Regulations 2005. 
 
Q3 Referring to footnote 72 on page 32 of the report by the secretariat, it is mentioned that overseas investments in sensitive assets are re quired to meet criteria for consent
 and conditions on 
such investments are imposed .  In addition, screening requirements may be used to limit investments 
for non-economic reasons .  
 
Q3-1 Please explain in more detail the above-men tioned "criteria for consent and conditions". 
 
Answer:  
The criteria for consent are set out in section 16 [sensitive land] and section 18 [significant business 
assets] of the Overseas Investment Act 2005 and sec tion 57G of the Fisheries Act 1996.  Consent may 
be unconditional, or subject to such conditi ons as the Ministers consider appropriate 
 
Q3-2 Please explain in more detail and give ex amples of "economic a nd non-economic reasons". 
 
Answer:  
The relevant factors are set out in section 17 of the Overseas Investment Act and Regulations 2005. 
 
Q3-3 Could foreign investors be able to own land and what are the criteria? 
 
Answer:  
Yes.  However, where the land is sensitive land, o verseas persons must seek c onsent to purchase this 
land.  "Sensitive Land" is defined in part 1 of Sc hedule 1 of the Overseas Investment Act 2005.  The 
relevant criteria that must be met for consent to  be granted is found in section 16 of the Overseas 
Investment Act 2005. 
 
Q4 Referring to paragraph 73 on pa ge 55 of the report by the secretariat concerning local content 
requirements, please explain the definition as well as gi ve examples of "suitable alternative" products. 
 
Answer:  
We confirm that tariff concessions are granted wh ere the domestic content of locally produced goods 
is less than  25% of its ex-factory cost of production.  There are typographical errors in paragraph 10 
on page ix, paragraph 28  on page 44 and paragr aph 73 on page 57 of the WTO TPR report, where 
references to "not less than 25%" of a good's ex-fa ctory cost of production should refer to "less than 
25%".  Suitable alternative goods are defined as those whic h perform the same or a similar function to the 
imported goods for which a concession is s ought; and where the imported goods would compete 
directly in the same market.  Price and quality ar e not normally taken into consideration.  For 
example, a New Zealand made metal bucket would be  a suitable alternative product to an imported 
plastic bucket.  Similarly, a New Zealand made ny lon bag would be a suitable alternative to an 
imported cotton bag. In both these examples, beca use there are suitable alternatives manufactured 
locally the concession applications would be turned down. 
 
As a further illustration using both the suitable alternative test and the 25% local content 
requirement, an imported glass melting furnace coul d be granted a tariff concession if glass melting 
furnaces are not available from New Zealand manu facturers.  Similarly, a glass melting furnace 
could be granted a tariff concession if glass melting furnaces were to be manufactured in  WT/TPR/M/216/Add.1 
 Page 91 
 
 
  New Zealand but they had less than 25% local content (represented by New Zealand sourced 
materials, wages and factory overheads).  An im ported glass melting furnace would not, however, be 
granted if glass furnaces were manufactured in Ne w Zealand with 25% or more New Zealand content. 
 
Q5 Referring to paragraph 96 on page 62 of the report by the secretariat, it is mentioned that 
New Zealand does not appear to provide direct s ubsidies for any sector-specific economic activities.  
Does New Zealand provide any indirect subsidies for the above-mentioned activities?  If yes, please 
explain how such subsidies are provided and for which activities?  
Answer:
 
New Zealand does not provide any direct subsidi es for sector-specific economic activities and does 
not, therefore, keep any register of "possible" di rect subsidies provided.  For more detail on the 
agricultural support provided by  the New Zealand Government, plea se see New Zealand's most recent 
domestic support notification provided to the WTO Committee on Agriculture WT/AG/NZL/52.  All agriculture support provided by  New Zealand is outlined in our ongoing domestic support 
notifications.  As per New Zealand 's notifications, all domestic suppor t provided by New Zealand is 
Green Box consistent and covers, for example, pr ogrammes relating to pest and disease control, 
inspection services, extension and advisory services and payments for relief from natural disasters.  
Consistent with Annex 2 of the Agreement on Ag riculture, such support meets the fundamental 
requirement that it has no, or at most a minimal, trade-distorting effect or effect on production. 
 
 
MEXICO
 
Regarding the amendments to the Copyright Act introduced in 2008: 
 Q1 How is the neutrality of the right of communi cation to the public guaranteed or provided for 
with respect to technology? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 Q2 How has the liability of Internet service pr oviders (ISPs) been delimited in copyright 
infringement cases?  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q3 What acts have been permitted for fair dealing?  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q4 Does the Copyright Act provide for the protec tion of titles, names, appellations, distinctive 
physical and psychological characteristics, or orig inal operating characteristics, applied to any of the 
following categories in accordance with their nature? 
 
Q4-1 Periodical publications:  published in successive parts with a variety of content, with a view 
to indefinite continuation;  WT/TPR/M/216/Add.1 
Page 92  
 
  Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q4-2 Periodic broadcasts:  emitted in successive parts with a variety of content and capable of 
further transmission; 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today. We will 
provide a response as soon as possible. 
 
Q4-3 Character based, fictional or symbolic human personalities;  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q4-4 Persons or groups engage d in artistic activities;  and 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today. We will 
provide a response as soon as possible.  
Q4-5 Promotional advertising:  involving a novel and unprotected mechanism for the purpose of promoting or offering a good or a service with the ad ditional incentive of giving the general public the 
chance to obtain another good or service on more favourable conditions than are available in the 
ordinary course of trade. 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 Q4-6 If this is the case, under what legal provision are they protected? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q5-1 Does the Copyright Act of 1994 provide fo r the protection of expressions of folklore? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q5-2 If so, how extensive is the protection of such expressions?  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q6 What is the duration of the protection of related rights in New Zealand?   WT/TPR/M/216/Add.1 
 Page 93 
 
 
  Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q7 Regarding enforcement measures: 
 
Q7-1 Does the New Zealand Police act at the requ est of a party, or does it initiate criminal 
proceedings ex officio?  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q7-2 Does the suspension by the Customs Service of the release into circulation of the goods 
necessarily involve the initiation of  infringement proceedings by the holder of the right in question? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q7-3 How does the communication between the Cu stoms Service and the companies affected by 
the infringement of their intellectual property rights work? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q7-4 If customs clearance of goods  has been suspended ex officio and the goods are found to be 
legal, who covers the storage and other costs and/or prejudice to the importer? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q7-5 Does the suspension of customs clearance not apply in the case of infri ngement of inventions? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q8 What other measures may the court orde r for adoption by the Customs Service? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q9 Regarding geographical indications: 
Q9-1 Who can be the holder of a geographical indication in New Zealand? 
 
Answer:  
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. WT/TPR/M/216/Add.1 
Page 94  
 
  Q9-2 Does New Zealand have protected geographi cal indications, and if so, for what products? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q9-3 What protection is granted to a foreign geographical indication?  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q10 Regarding patents:  Q10-1 Could you please provide more informati on regarding the Patent Bill calling for new 
measures that will assist in protecting traditional knowledge and indigenous plants and animals? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 Q10-2 Can patents be granted on business or commercial methods? 
 
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
 
 INDIA
 
 
Q1 It has been reported that New Zealand is insisting on risk analysis and quoting a timeframe of 2-3 years for allowing export of mangoes from India.  It has also been learnt that mangoes from some 
other countries have been allowed without this requirement. India would appreciate response of 
New Zealand in this regard.  
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
Q2 It has been reported that New Zealand does not  give India 'Comparable Labour Market Status' 
even though New Zealand has graded Indian Universities into A, B, C categories, work experience is 
still not counted.  We would like to know if certain exceptions have been made in granting this status 
to other countries and on what grounds so that  India could also benefit from movement of its 
professionals. 
 
Answer:
 
The grading of universities does not relate to comparable labour market status.  Comparable labour market status does not apply to temporary entry for employment, but only to skilled permanent 
residence applications.  It is therefore not re levant to the temporary movement of skilled 
professionals.    WT/TPR/M/216/Add.1 
 Page 95 
 
 
  CANADA  
 
The Secretariat Report states that, "on 4 March 2008,  the Government added a new regulation to the 
OIA 2005 enabling the OIO to take into account "whether  the overseas investment will, or is likely to, 
assist New Zealand to maintain New Zealand control of strategically important infrastructure on 
sensitive land"." 
 Q1 Could New Zealand please clarify what it mean s by "strategically important infrastructure" 
(SII)?   Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible. 
 
Q2 Could New Zealand please explain whether the onus rests on the foreign investor to prove 
that his investment will, or is likely to, assist New Ze aland to maintain its control of SII or rather rests 
on the Government to prove that said investment will not, or is not likely to, assist it in maintaining its 
control of SII?   
Answer:
 
Due to the late receipt of this question, it has not  been possible to provide a response today.  We will 
provide a response as soon as possible.  
 
 WT/TPR/M/216/Add.1 
Page 96  
 
  REPLIES PROVIDED BY NEW ZEALAND (SECOND SESSION) 
 
CHINA – Add 1
 
 
Q17 Are there any specific regulations with rega rd to advanced technologies and related products? 
If yes, please provide a list of the regulations a nd indicate how they could be accessed including via 
website.  
Answer:
 
New Zealand controls the export of strategic goods a nd technologies to ensure that such exports are 
consistent with broader strategi c and security policy objectives.  The system is an essential part of our 
non-proliferation and disarmament policy.  New Zealand, as a member of the Wassenaar 
Arrangement, controls the export of dual-use items wh ich may have a military application.  Generally 
speaking, not all high tech products are considered dual-use.    
Under the Customs and Excise Act 1996 and the Customs Export Prohibition Order 2008 the export 
of strategic goods, software and technology is prohi bited without the consent of the Secretary of 
Foreign Affairs and Trade.  Exporters submit an application to the Ministry of Foreign Affairs and Trade and are encouraged to provide as much information as possible about the technical 
specifications of the item, the end-user and the des tination country.  Applica tions are then forwarded 
to the relevant technical advisor for advice.  Wher e it is determined the goods are controlled, the 
application is assessed against standing assessment criteria agreed by Ministers.  These criteria are 
consistent with export control regime guidelines.   Both the assessment criteria and the New Zealand 
Strategic Goods List (which lists controlled items ) can be found on the Ministry of Foreign Affairs 
and Trade's website – www.mfat.govt.nz  
As provided for in the Customs and Export prohi bition Order 2008, New Zealand has extended the 
control on the export of strategic goods to co ver unlisted goods and technologies intended for a 
military or weapons of mass destruction end-use, and  the electronic export of controlled software and 
technologies.  These controls are known as "catch-alls" or end-use controls. 
  
MEXICO
 
 
Regarding the amendments to the Copyright Act introduced in 2008: 
 Q1 How is the neutrality of the right of communi cation to the public guaranteed or provided for 
with respect to technology? 
 
Answer:
 
The definitions of communicate and communication wo rk are not confined to any specific types of 
broadcasting technology and telecommunications system. 
 Q2 How has the liability of Internet service pr oviders (ISPs) been delimited in copyright 
infringement cases?  
Answer:
 
Several sections in the Copyright Act limit ISPs ’ liability in copyright infringement cases: 
 
Section 92B provides that merely because a person uses the Internet services of  the Internet service 
provider in infringing the copyright, the Internet service provider, without more, 
- Does not infringe the copyright in the work:  WT/TPR/M/216/Add.1 
 Page 97 
 
 
  - Must not be taken to have authorised that persons infringement of copyright in the 
work;  and 
- must not be subject to any civil remedy  or criminal sanction (other than injunction 
relief in relation to the infringement). 
 
Section 92C provides that an ISP who stores material  provided by a user does not infringe copyright 
provided that ISP deletes or prevents access to the material, as soon as possible, after it knows or has 
reason to believe that the material it is hosting infringes copyright.   Section 92E states that an ISP does not infringe copyright by caching infringing material provided it 
follows certain procedures.  
Q3 What acts have been permitted for fair dealing?  
Answer:
 
New Zealand's Copyright Act does not contain fair de aling provisions per se, rather it provides for a 
variety of specific and limited permitted acts that  do not amount to copyright infringement.  Such 
permitted acts include, for example, incidental copy ing of a work in an artistic work, sound recording, 
film or broadcast; and for the purposes of criticism, review, new reporting, research or private study.  
 The Copyright (New Technologies) Amendment Act 2008 introduced a number of new permitted acts 
and these included: 
- Transient or incidental copying of a wo rk especially when it is an integral or 
essential part of a technological process for making and receiving communication that does not infringe copyright  or enabling the lawful use or , or lawful dealing in the 
work; and provide that copying has no independent economic significance; 
- The caching of webpages by educational est ablishments for educational purposes 
under limited conditions; 
- The communication of a digital work by libra ries and archives to authenticated users 
where copy of the digital work is a lawful copy under limited circumstances; 
- The supply of copies of works in digital format by libraries and archives under 
limited circumstances; 
- The copying; backing up; decompilation; adaptation; observing, studying and testing 
of computer programmes under limited circumstances;  and 
- The format shifting of lawfully acquired sound recordings for personal use under 
limited circumstances.    
 
Q4 Does the Copyright Act provide for the protec tion of titles, names, appellations, distinctive 
physical and psychological characteristics, or orig inal operating characteristics, applied to any of the 
following categories in accordance with their nature?  
Answer:
 
Titles, names, and appellations will usually not q ualify for copyright protection as they are not 
generally considered not to be original litera ry works.  Distinctive physical and psychological 
characteristics and original operating characteris tics are not protected, because the Copyright Act 
only protects original expressions. 
 
Q4-1 Periodical publications:  published in successive parts with a variety of content, with a view 
to indefinite continuation; 
 
Answer:  
Individual editions of a periodical would be protec ted, but only upon actual publication of each 
edition. WT/TPR/M/216/Add.1 
Page 98  
 
  Q4-2 Periodic broadcasts:  emitted in successive parts with a variety of content and capable of 
further transmission;  
Answer:
 
Broadcasts, when made, are protected as communication works. 
 
Q4-3 Character based, fictional or symbolic human personalities;  
Answer:
 
No. 
 
Q4-4 Persons or groups engage d in artistic activities;  and 
 
Answer:  
No - individual persons and groups of persons do not qualify for copyright protection per se, rather it 
is the original expression of their creative ideas that  would be protected.  A person or groups giving 
performance is given protection against the unautho rised copying of their performance through the 
provisions of the Copyright Ac t concerning performers' rights. 
 
Q4-5 Promotional advertising:  involving a novel and unprotected mechanism for the purpose of promoting or offering a good or a service with the ad ditional incentive of giving the general public the 
chance to obtain another good or service on more favourable conditions than are available in the 
ordinary course of trade.  
Answer:
 
Promotional advertisements may be protected by copyright as, for example, original literary and/or 
artistic works.  The particular use of promotional schemes, esp ecially those offering additional 
incentives, however is not regulated under copyright law.  Such schemes are, instead, regulated under 
trade practices legislation, such  as the Fair Trading Act 1986. 
 
If this is the case, under what legal provision are they protected? 
 Q5 Does the Copyright Act of 1994 provide for the protection of expressions of folklore?  If so, 
how extensive is the protection of such expressions?  
Answer:
 
Yes – but only to the extent that the expression of folklore meets the criteria of being an original 
literary, dramatic, musical or artistic wo rk to qualify for copyright protection. 
 
Q6 What is the duration of the protection of related rights in New Zealand?  
Answer:
 
Protection of performers' rights last for a period of 50 years from the end of the calendar year in 
which the performance in question took place.   Note, however, that broadcasters, and the producers 
of cable programme services are considered to be aut hors for the purpose of the copyright protection. 
 
Q7 Regarding enforcement measures:  
Q7-1 Does the New Zealand Police act at the requ est of a party, or does it initiate criminal 
proceedings ex officio?   WT/TPR/M/216/Add.1 
 Page 99 
 
 
  Answer:  
In regards to enforcement of the criminal offences for trade mark counterfeiting and copyright piracy 
the New Zealand Police will usually only act at the request of an aggrieved person (normally a trade 
mark or copyright owner), although there is no legislative barrier to them acting ex officio. 
 
Q7-2 Does the suspension by the Customs Service of the release into circulation of the goods 
necessarily involve the initiation of  infringement proceedings by the holder of the right in question? 
 
Answer:  
Yes.  Under the border protection measures spec ified under the Trade Marks Act 2002 and Copyright 
Act 1994, the Customs Service may only suspend the release into circulation of suspected infringing 
goods after first having received a notice from the tr ade mark or copyright owner (or their agent), 
and then for an initial period of 10 working days (exte ndable upon request to 20 days).  At the end of 
the initial 10 day period the Customs Service mu st release the goods to the importer unless: 
- The importer forfeits the goods to the State or right holder; 
- The Customs Service is served with a court order for continued detention of the goods 
until the court makes a determination as to wh ether the goods are infringing (i.e. the 
right holder has initiated infri ngement proceedings);  or  
- The Customs Service is served with a court order that the notice be discharged or the 
goods be released to the importer. 
 
Q7-3 How does the communication between the Cu stoms Service and the companies affected by 
the infringement of their intellectual property rights work?  
Answer:
 
Border protection notices seeking the detention of susp ected infringing goods must be made in writing 
to the Customs Service.  Should the Customs Servi ce detain any suspected infringing goods written 
notice must be provided by the Customs Service to both the right holder and the importer of this 
action.  Furthermore, in regards to an investigati on by the Customs Service to establish whether or 
not the goods may be suspected of being infringing goods to which a notice relates, the Customs Service may require the right holder or any other pers on to provide, within ten working days of being 
required to do so, any information that is rea sonably necessary to the Customs Service for the 
purpose of the investigation.  Both the importer and the right holder may make a request to the 
Customs Service to inspect the goods in question.    A right holder in giving a notice under the border protection measures to the Custom Service must 
provide a New Zealand address for service for all communication 
 
Q7-4 If customs clearance of goods  has been suspended ex officio and the goods are found to be 
legal, who covers the storage and other costs and/or prejudice to the importer? 
 
Answer:
 
Not applicable, because under New Zealand's bord er protection measures the Customs Service do 
have ex officio powers to detain  suspected infringing goods. 
 However, as a condition of the Customs Service accepting a border protection notice from a right 
holder, the right holder must provide the Customs S ervice with a letter of indemnity for any and all 
cost incurred by the Customs Service during th e enforcement of a border notice.  Ultimately, 
therefore, the right holder is legally responsible  for covering Customs Services costs arising from 
storage (and destruction) of suspected infringing goods.  WT/TPR/M/216/Add.1 
Page 100  
 
  If the outcome of infringement proceedings is that  the court determines that the suspected infringing 
goods are legally able to be imported into New Ze aland, the courts may order the right holder to 
cover the importer's costs arising from the legal proceedings.  
Q7-5 Does the suspension of customs clearance not apply in the case of infri ngement of inventions? 
 
Answer:
 
No, New Zealand's border protection measures cover only goods suspected of infringing a registered 
trade mark or copyright. 
 Q8 What other measures may the court orde r for adoption by the Customs Service? 
 
Answer:
 
None. 
 Q9 Regarding geographical indications: 
 Q9-1 Who can be the holder of a geographical indication in New Zealand?  
Answer:
 
There are a several different mechanisms by which ge ographical indications can be protected in 
New Zealand, and these include:  the tort of "passi ng off";  the Fair Trading 1986;  and registration 
under the Trade Marks Act 2002 as collective or cer tification marks.  There are no specific rules or 
regulations specifying precisely who may be the hold er of a geographical indication in New Zealand.  
In general, a person would need to show that th ey are an "interested" person, such as an individual 
producer or bodies or organisations representing producers, to have standing in any of the above 
mechanisms for the protection of geographical indications.  
Q9-2 Does New Zealand have protected geographi cal indications, and if so, for what products? 
 
Answer:
 
As noted above, New Zealand provides protection fo r geographical indications through a variety of 
mechanisms.  These mechanisms do not currently incl ude a sui generis GIs register so it is not 
possible to definitively list all products that benefit from GIs protection.   
 
Q9-3 What protection is granted to a foreign geographical indication?  Answer:
 
Protection is available to foreign geographical indi cations in the same manner as protection is 
available to local geographical indications. 
 
Q10 Regarding patents:  
Q10-1 Could you please provide more informati on regarding the Patent Bill calling for new 
measures that will assist in protecting traditional knowledge and indigenous plants and animals? 
 
Answer:
 
The Patents Bill will, when enacted, estab lish a Maori Advisory Committee to advise the 
Commissioner of Patents on patent applications invo lving traditional knowledge  or indigenous plants 
and animals.  The Committee will advise whether the inventions claimed in such applications are novel or involve an inventive step, and whether co mmercial exploitation of the invention might be 
contrary to Maori values. 
  WT/TPR/M/216/Add.1 
 Page 101 
 
 
  Q10-2 Can patents be granted on business or commercial methods? 
 
Answer:  
There is no specific prohibition in New Zealand's cu rrent patent legislation (o r in the Patents Bill) 
that specifically prohibits the patenting of business or commercial methods.  To be granted a valid 
patent, such methods must be a "manner of manuf acture", new, non-obvious, and useful.  The term 
"manner of manufacture" has been in terpreted by the courts as excludi ng from patent protection such 
things as mathematical algor ithms, and mere schemes or plans.  Some business or commercial 
methods which are considered to be algorithms or mere schemes or plans may therefore be refused 
patent protection. 
 
 INDIA
 
 
Q1 It has been reported that New Zealand is insisting on risk analysis and quoting a timeframe of 
2-3 years for allowing export of mangoes from India.  It has also been learnt that mangoes from some 
other countries have been allowed without this requirement. India would appreciate response of 
New Zealand in this regard.  
Answer:
 
MAF Biosecurity New Zealand (MAFBNZ) requires that  all new import health standards (IHS) must 
be based on scientific principles and risk analysis pr ocesses in line with Inte rnational Standards for 
Phytosanitary Measures, with particular reference to (ISPM 2) "Framework for pest risk analysis."  
 New market access requests from all countries that  require the development of a new import health 
standard are subject to the same process.  A risk anal ysis is undertaken to identify biosecurity hazards 
associated with the commodity and or pathway and to assess what if any phytosanitary measures are 
required to mitigate respective risks.   The time for completing individual risk analyses varies with the 
complexity of the required analysis.  Upon the comple tion of the risk assessment, an IHS is developed.  
 As per our letter of 13 March 2009, from Tim K nox (Director Border Standards) to Joint Secretary 
Mr Pankaj Kumar, MAFBNZ would like to reaffirm that mangoes from India are being considered in 
the prioritisation process to determine the impor t health standard development work programme for 
2009-2011.   For more information on the prioritisation pro cess and the development of an import health standard 
please refer to the following website:  http://www.bi osecurity.govt.nz/regs/imports/ihs/request.  We 
will inform you of the outcome of this process as soon as possible.  
 
CANADA
 
 
The Secretariat Report states that, "on 4 March 2008,  the Government added a new regulation to the 
OIA 2005 enabling the OIO to take into account "whether  the overseas investment will, or is likely to, 
assist New Zealand to maintain New Zealand control of strategically important infrastructure on sensitive land"."  Q1 Could New Zealand please clarify what it mean s by "strategically important infrastructure" 
(SII)? 
 
Answer:
 
Strategically important infrastructure has not been defined. 
 WT/TPR/M/216/Add.1 
Page 102  
 
  Q2 Could New Zealand please explain whether the onus rests on the foreign investor to prove 
that his investment will, or is likely to, assist New Ze aland to maintain its control of SII or rather rests 
on the government to prove that said investment will not, or is not likely to, assist it in maintaining its 
control of SII?   Answer:
 
In the case of investments in sensitive land, Minist ers, or the regulator (where delegated) determine 
whether the investment will or is likely to benefit New Zealand.  One of the factors for assessing this 
benefit is whether the investment will assist Ne w Zealand to maintain New Zealand control of 
strategically important infrastructure on sensiti ve land.  This decision is based on information 
provided by the investor. 
  WT/TPR/M/216/Add.1 
 Page 103 
 
 
  ADDITIONAL REPLIES PROVIDED BY NEW ZEALAND 
 
CHINA – Add 1  
 
Q16 Please provide information on the policies a nd measures New Zealand has adopted in recent 
years to promote employment, including fi nancial, taxation and monetary policies. 
 
Answer:  
The New Zealand Government has taken a productivity  focussed approach to driving employment 
growth over the last few years.  As the full impacts  of the global economic crisis become evident, the 
Government has focussed in the recently annou nced 2009 Budget on three main areas: 
- Helping New Zealanders through the recession and supporting jobs; 
- Lifting productivity and raising New Zealand’s international competitiveness; and  
- Taking steps to keep future go vernment debt under control. 
 Further or more detailed information on the ac tual policies implemented can be found at 
http://www.treasury.govt.nz/budget/2009.  Information is  also available on this site relating to all 
Budgets delivered since 1997.   
THAILAND – Add 2
 
 
Q1 Referring to paragraph 31 on page 15 of the report by the secretariat, it is mentioned that 
budgetary funding for training and education  has been increased, as ha ve tax incentives, while 
budgetary expenditure is focused on projects ai med at removing infrastructure bottlenecks and 
capacity constraints. 
 Q1-2 Are tax incentives equally given to domestic  and foreign-owned companies in any business 
categories?  If not, please explain.   
Answer:
 
New Zealand has a broad tax base and very few me asures that could be described as business tax 
incentives.  Those that are available such as a depreciation loading for plant and equipment are 
equally available to both domestic and foreign firms. 
 
 ARGENTINA – Late Questions
 
 
Q1 Paragraph 13 of the Secretariat Report states that although New Zealand does not recognize 
any preshipment inspection of exports, the Ministry  of Agriculture and Forestry does perform some 
preshipment inspection overseas for bio-security pur poses.  In addition to the products and origins 
indicated in the Report, are there other products an d origins that are concerned by these inspections?  
What is the basis for deciding what inspections to conduct?  Answer:
 
We provide details of pre-shipment programs below: 
 
Japan Car Programme 
New Zealand MAF inspectors have b een pre-inspecting used vehicles out to Japan for the past 
10 years 
 WT/TPR/M/216/Add.1 
Page 104  
 
  MAFBNZ Quarantine Inspectors are co ntracted to 4 different Operato rs at various ports in Japan, 
who provide cleaning services of used vehicles des tined for New Zealand.  Vehicles are visually 
inspected after steam-cleaning & vacuumi ng to remove biosecurity risk material. 
 Pre-inspection keeps the biosecurity  risk offshore including insect pests such as; Lymantria dispar 
(Asian Gypsy Moth), Attagenus spp (carpet b eetles), Trogoderma spp(Grain beetles), spiders 
including Latrodectus hasselti (Red back spider)and ants.  Other contaminants of concern include 
soil, fresh plant material includi ng pine needles and weed seeds. 
 MAF pre-inspected vehicles are loaded onto car carrier vessels and shipped to New Zealand.  No 
further biosecurity intervention is required on arrival. 
 Australian Table Grape Programme MAFBNZ has been sending Quarantine Inspectors to Mildura, Australia since 1990 to pre-inspect 
grapes in;  Victoria, South Australia & New South Wales for export to New Zealand. 
 
Grapes fumigated with sulphur dioxide are inspect ed and passed by AQIS prior to the New Zealand 
pre-inspection being performed.  Grapes meeting req uirements are then loaded for airfreight or into 
containers and bolt sealed for shipment to New Ze aland.  These seals are checked on arrival in 
New Zealand.  
Consignments of grapes rejected for live insects, such as Latrodectus hasselti (Red back spider), 
snails or for excess weed seed contaminant such  as Chondrilla spp (skeleton weed seed), are not 
shipped to New Zealand, thus keep ing the Biosecurity risk offshore and reducing Industry costs in not 
having to fumigate or reship produce.  
 
U.S.A Table Grape Programme MAFBNZ has been sending Quarantine Inspecto rs to Bakersfield, California since 1989 to 
pre-inspect grapes for export to New Zealand. Th is came about from excessive weed seeds being 
found during inspection activities in New Zealand, resulting in some consignments being reshipped 
because there is no effective trea tment available for weed seed contaminants on grapes.  Following 
on from the weed seed contaminants, MAF starte d finding Black widow spiders, and then California 
had an infestation of Glassey winged sharpshooter a known vector or pierces disease which could 
cause considerable harm to the NZ wine industry   Grapes fumigated with sulphur dioxide are inspect ed and passed by USDA prior to the New Zealand 
pre-inspection being performed.  Grapes meeting req uirements are then loaded for airfreight or into 
containers and bolt sealed for shipment to New Ze aland. These seals are checked on arrival in 
New Zealand.  Consignments of grapes rejected for live insects e.g. Latrodectus mactans, (black widow spider) 
Metaphidippus spp (jumping spiders), Drosophila spp (Pomace fly), or for excess weed seed 
contaminant are not shipped to New Zealand, thus keeping the Biosecurity risk offshore and reducing 
Industry costs in not having to fumigate grap es with methyl bromide, or reship produce. 
 Mexico Table Grape Programme MAFBNZ has been sending Quarantine Inspectors to  Nogales, Arizona to pre-inspect grapes from 
Hermosillo, Sonora region in Mexico for ex port to New Zealand for the past 2 years. 
 Grapes are inspected and passed by SAGARPA/SENA SICA in Mexico prior to the New Zealand 
pre-inspection being performed at Nogales on the Arizona side of the Mexican border.  Grapes are  WT/TPR/M/216/Add.1 
 Page 105 
 
 
  loaded into containers under MAFBNZ supervision and bolt sealed for shipment to New Zealand. 
These seals are checked on arrival in New Zealand.  Consignments of grapes rejected for live insects su ch as; Cheiracanthium inclusum (Yellow Sac 
spider) Nysius spp (wheat bug) or for excess weed seed contaminant are not shipped to New Zealand, 
thus keeping the Biosecurity risk offshore and reducing Industry costs in not having to fumigate or 
reship produce.  Pre-Inspection of Cargo At the request of Industry MAFBNZ is able to depl oy Quarantine inspectors globally to pre-inspect 
any cargo from;  circus equipment, to oil rigs, to sawmill equipment, or racing cars destined for 
New Zealand.  This pre-inspection option keeps the biosecurity risk offshore and allows the importer 
less intervention by MAFBNZ on arrival.  Intercep tions might include;  ants, mosquitoes, spiders, 
Giant African Snail, plant material, weed seed contamination as well as soil.  
The freight is cleaned by the contracting company and pre-inspected offshore by MAFBNZ 
Quarantine Inspectors prior to bei ng packed into containers or sight ed onto vessels for export to New 
Zealand.  If the freight is shipped bulk- break on a vessel th is is sighted by MAFBNZ Quarantine Inspectors at 
the port of arrival to ensure no cross contaminant in shipping.  Bolted containers are seal checked on 
arrival. 
 All pre-shipment programmes conducted offshore by MAFBNZ are fully cost recovered from Industry. 
 
Q2 According to paragraphs 28 and 29 of the S ecretariat Report, New Zealand may grant tariff 
concessions if producers cannot supply suitable altern ative goods or if the domestic content of the 
locally-produced "suitable alternative" is not less th an 25% of its ex-factory cost.  There are currently 
16 "concession references" and, for example, "Refer ence 99" concessions may be granted for various 
reasons. 
- Could you please provide more details on how this system operates? 
- Could you please provide a list of all of th e concession references and the reasons 
why they are granted? 
 
Answer:
 
We confirm that Reference 99 tariff concessions ar e granted where the domestic content of locally 
produced goods is less than 25% of its ex-factory cost of production.  There are typographical errors 
in paragraph 10 on page ix, par agraph 28 on page 44 and paragrap h 73 on page 57 of the WTO TPR 
report, where references to "not less than 25%" of a good's ex-factory cost of production should refer 
to "less than 25%".   The reference 99 tariff concession system operates on the basis of whether or not suitable alternative 
goods are available from New Zealand manufacturers or producers.  Suitable alternative goods are 
defined as those which perform the same or a si milar function to the imported goods for which a 
concession is sought;  and where the imported goods would compete directly in the same market.  
Price and quality are not normally taken into c onsideration.  For example, a New Zealand made 
metal bucket would be a suitable alternative produc t to an imported plastic bucket.  Similarly, a 
New Zealand made nylon bag would be a suitable a lternative to an imported cotton bag.  In both 
these examples, because there are suitable alt ernatives manufactured locally the concession 
applications would not be granted.  As a further illustration using both the suitable alternative test and the 25% local content 
requirement, an imported glass melting furnace coul d be granted a tariff concession if glass melting WT/TPR/M/216/Add.1 
Page 106  
 
  furnaces are not available from New Zealand manu facturers.  Similarly, a glass melting furnace 
could be granted a tariff concession if glass melting furnaces were to be manufactured in 
New Zealand but they had less than 25% local content (represented by New Zealand sourced materials, wages and factory overheads).  An im ported glass melting furnace would not, however, be 
granted if glass furnaces were manufactured in Ne w Zealand with 25% or more New Zealand content. 
 
The sixteen concession references provide duty f ree entry for a number of reasons including 
social/humanitarian purposes, Customs facilita tion e.g, passengers' baggage, trade policy and 
industry assistance purposes.   
The following is a list of all the tariff concession references. 
   26 Medicaments and pharmaceutical goods  30 Goods included in certain Annexes to the UNESCO Agreement 
 35 Handmade goods from developing countries 
 40 Goods for the promotion of international touring 
 45 Goods used for disaster relief  55 Temporary imports  60 Goods in respect of which a duty vari ation is required to fulfil a GATT commitment 
 66 Goods re-entered into New Zealand after repair or alteration  70 Heirlooms 
 75 Certain gifts 
 80 Passengers Baggage  81   Passengers Baggage  82 Passengers Baggage  90 Religious goods 
 91 Goods partially manufactured in New Zealand 
 99 Other goods   Full details of all sixteen concession references can be seen at:  http://www.customs.govt.nz/ 
nr/rdonlyres/04829833-5e70-46 0c-b8a0-7ba36aafe4e8/0 /02concessions.pdf 
 Q3 According to paragraph 37 of the Secret ariat Report, during the period under review, 
New Zealand introduced a number of changes to its legislation on anti-dumping and countervailing 
measures.  What, exactly, are these changes and what were the reasons for introducing them? 
 
Answer:
 
In November 2006, the New Zealand Parliament  passed the Dumping and Countervailing Duties 
Amendment Act 2006 which resulted in a minor amendment to the Dumping and Countervailing 
Duties Act 1988 (the principal Act).  The amendmen ts were to the following sections of the Act: 
 Section 3. Interpretation Section 3(1) of the Act is the section that prov ides definitions for technical and specific terms used 
within the Act.  This section of the principal Act was amended by inserting the following definition in 
its appropriate alphabetical order: "day", except in sections 14(2), 17 and 17B(4), me ans any day of the week other than a day in the 
period beginning with 25 December in any year and ending with 15 January the following year.  
Section 14. Anti-dumping and countervailing duties 
Section 14(1) of the Act was am ended by omitting "secti on 17 of this Act" and substituting "section 
17, 17A, or 17B".   WT/TPR/M/216/Add.1 
 Page 107 
 
 
  Section 17. Retrospective measures 
Section 17 of the Act was repealed and sections 17, 17A and 17B were substituted:  Purpose of the Amendments  
The purpose of these amendments was to: 
- Allow the Minister of Commerce to spec ify the date from which new and reassessed 
rates of anti-dumping and countervailing duty will apply; 
- Correct an anomaly in the principal Act t hat to apply reassessed rates after the 
Minister’s decision to change a rate, the clumsy technical mechanism to terminate the 
original duties in whole or in part for the period since the duties were originally 
imposed was replaced; and  
- Exclude the period from 25 December to 15 January from the statutory timeframe for 
the completion of dumping and subsidy investigations. 
 
Full notification of these changes was made to the Committee on Anti-Dumping Practices and the 
Committee on Subsidies and Countervailing Measures at their April 2007 meetings.  The relevant 
WTO documents are:  G/ADP/N/1/NZL/2/Suppl.3 and G/SCM/N/1/NZL/2/Suppl.3. 
 
Q4 Paragraph 58 of the Secretariat Report stat es that in October 2008, New Zealand issued a 
standard under the Food Act requiring importers to  be listed with the New Zealand Food Safety 
Authority (NZFSA) for the purpose of ensuring that  importers received relevant information and 
advice relating to food safety in the event of a food recall.  Q4-1 What is the registration procedure and how much does it cost?  Answer:
 
The importer is listed not registered.  There is no approval process and therefore no fee (no cost) to 
be listed.  An importer must provide NZFSA with  a contact person in New Zealand.  This contact 
person must be able to provide NZFSA with doc uments relating to consignments of goods for 
traceability purposes when requested to do so.   
If an importer is resident overseas, contact details must be provided for a person in New Zealand who 
deals with day-to-day enquiries.  Customs agents may be provided as the New Zealand contact person 
(if they are willing to be the contact person) under clause 6 of the Listing St andard particularly if they 
complete and store documentation related to the c onsignment on behalf of the importer.  Importers 
who list 'on-line' can change thei r listing details as appropriate. 
 Q4-2 What does the Report mean by food "recall"? 
 
Answer:
 
Section 40 of the Food Act 1981 allows food to be 'recalled from sale' (i.e. the Minister issues an order stating that the food cannot be sold) for the prot ection of the public.  This 'Ministerial order' is 
only ever used in cases of a serious public health threat.  Voluntary recalls are far more commonly 
used by food businesses where minor concerns or quality defects have been identified or where 
immediate action is taken on serious issu es without the need for an order. 
 
Q5 According to paragraph 95 of the Secret ariat Report, since 2006 New Zealand has been 
implementing an initiative known as "Buy Kiwi Made" under which funding is provided for sectoral 
initiatives to raise the profile of domestic products.  The report also mentions that in January 2009, the 
programme was being reviewed.  We would be gratef ul for further details in addition to what was 
provided in document G/SCM/N/155/NZL on the nature  of this programme and on the results of the 
January review. WT/TPR/M/216/Add.1 
Page 108  
 
  Answer:
 
The Buy Kiwi Made programme was a product of  a co-operation agreement between the previous 
Government and the Green Party following the 2005 election.   The nature of the program was to provide s upport for sector and regional initiatives that are 
consistent with the policy framework for Buy Kiwi Made, which was intended to help raise the profile 
of New Zealand-made products.   The total amount of funding for the Buy Kiwi M ade Programme was $11.5m over three years, split 
between two operational components: the Sectoral  and Regional Initiative Fund ($3m) and the Buy 
Kiwi Made media campaign ($8.5m).  Following a substantial under-spend in the first two funding 
rounds, the Sectoral and Regional Initiative Fund wa s capped at $0.975 million, with the remaining 
money transferred to extend the media campaign.   Following an evaluation of the Buy Kiwi Made  Programme in early 2009, the programme was 
disestablished on 30 June 2009.  
Q6 Paragraph 26 of the Secretariat Report states that in September 2008, New Zealand introduced an emissions-trading scheme that put s a price on greenhouse gases and provides an 
incentive to reduce emissions and increase forest areas.  
Q6-1 What are these incentives? 
 
Answer:
 
The incentive is in the form of a price on greenhouse gas emissions and removals.  The New Zealand Emissions Trading Scheme (NZ ETS) will place a price on greenhouse gas emissions and removals 
for all sectors covered by the scheme.  The forestry sector is covered by the scheme. 
 
Q6-2 How are the prices on greenhouse gases fixed? 
 
Answer:
 
The price of emissions within the New Zealand economy will be set by the supply and demand for 
emission units that are acceptable for surrender under the NZ ETS.   
 
Q6-3 What is the legal basis for this programme? 
 
Answer:  
The NZETS was legally established under the C limate Change Response Ac t 2002 as amended in 
September 2008. 
 
 
CHINA – Add 2  
 Q1 Would New Zealand please indicate the specific measures, if these exist, which have been 
taken since 2003 to promote the exports of agricultu ral products, especially that of dairy products? 
 
Answer:
 
The New Zealand Government does not take any sp ecific measures to promote the export of 
agricultural products.  Promotional activities are carried out by the expor ters themselves.  No 
subsidies are supplied for dairy exports.   
Q2 Would New Zealand please introduce the polici es and provisions on the cross-border merger 
and acquisition by financial institutions and also ot her types of business?  Is there a higher threshold  WT/TPR/M/216/Add.1 
 Page 109 
 
 
  for certain sectors, such as energy, high-tech, an d etc.?  Are there any differential requirements 
applied to the investment by enterprises of differe nt ownership structures, such as state-owned ones 
and private ones?  
Answer:
 
Investments such as cross border mergers and acqui sitions may need to seek consent under the 
Overseas Investment Act 2005, if the investment in cludes significant business assets, sensitive land or 
fishing quota (as defined in the Act).  The thres holds are the same across all sectors.  The 
requirements apply equally to overseas investment s from private companies and state owned. 
 Q3 Would New Zealand please share with us the information, if these exist, on the regime of 
taxes and fees on ships and vessels, including their ra tes, responsible authorities, laws or regulations 
and how these taxes and fees are levied?  
Answer:
 
We provide details below on the various regimes of taxes and fees: 
 Ship registration To register a vessel as a New Zealand ship under the Ship Registration Act 1992 an application must 
be made to Maritime New Zealand.  This incurs an application fee.  The different rates are set out in 
the Marine Safety Charges Regulations, available online from www.legislation.govt.nz. 
 
All vessels that are used to take fish, aquatic life, or seaweed for sale from New Zealand waters must 
be registered as New Zealand fishing vessels under th e Fisheries Act 1996.  An application fee applies 
to register a fishing vessel.  The different rates are set  out at http://www.fishserve.co.nz/information/ 
fees/.  
 
Marine Safety Charge Maritime safety regulatory work, including port stat e control, is largely funded by a Marine Safety 
Charge which is collected by Maritime New Zealand (www.maritimenz .govt.nz) from all commercial 
shipping.  The rates for different types of shippi ng (international, domestic, passenger, freight etc) 
vary according to the amount of regulatory effort  and risk involved with each shipping type and 
whether they trade constantly in New Zealand, in wh ich case most pay an annual  charge, or visit from 
time to time, in which case charges are typically p er port call.  The different rates are set out in the 
Marine Safety Charges Regulations, avail able online from www.legislation.govt.nz. 
 Oil pollution levy 
The cost of maintaining New Zealand's marine o il spill response system is funded by the Oil Pollution 
Levy, which applies to all ships carrying oil as fu el or cargo and is collected by Maritime New 
Zealand.  All ships pay a levy based on the size of  the ship.  Ships carrying oil as cargo pay an 
additional levy on the amount of oil on board.  Ships operating domestically are levied annually. 
Other ships are levied per port call.   The different rates are set out in the Oil Pollution Levies Order, 
at www.legislation.govt.nz. 
 
GST Goods and Services Tax (GST) is payable for the suppl y of all goods (whether consumer or capital) 
and services.  Any ship (like any other piece of large capital equipment such as tractors, airplanes 
and trains) imported into New Ze aland is subject to GST.  
 
The tax does not apply to vessels passing through Ne w Zealand waters in the course of international 
trade with New Zealand. Refer to the Goods an d Services Tax Act, at www.legislation.govt.nz. 
 WT/TPR/M/216/Add.1 
Page 110  
 
  Biosecurity 
New Zealand's biosecurity is the responsibility  of the Ministry of Agriculture and Forestry 
(www.biosecurity.govt.nz).  There are two sets of regulations under the Biosecurity Act 1993 that 
impose relevant charges;  the Biosecurity (Cos ts) Regulations 2006 and Biosecurity (Shipping 
Container Levy) Order 2006).  Refer to www.legislation.govt.nz. 
 
 
USA – Follow-up Questions
 
 
U.S. Q4-1(e):  We are also interested in the G overnment's goal to ensure the delivery of safe and 
"suitable" food in New Zealand.  How does the Government define "su itable" in this context?  What, 
in the Government's view, constitutes a "suitable" food?  
NZ Answer:
 
Suitability includes the compositi on, labelling, identification and condition of food but does not 
include matters that are directly related to food safety , or matters that are related to the food's quality 
requirements for commercial reasons.  It may contai n matters relating to the composition, such as the 
presence of a substance that would be unexpected or  unreasonable.  A suitable food is one that meets 
New Zealand's applicable food standards.  
 
U.S Follow-up Q:  
Please provide an example or explain further what is  meant by "a substance that would be unexpected 
or unreasonable" in this context?  
Answer:
 
An example of food that is unsuitable is food that is: 
(a) In a condition that is offensive or is so perished as to affect its intended use; or 
(b) Contains, has attached to it or enclosed with it,  or is in contact with any  thing that is offensive 
or is so perished as to affect its intended use; or 
(c) The presence of which would be unexpected and unreasonable in food of that description. 
 An example would be finding a snail or  slug inside a bottle of ginger beer.  
 
 
EC – Follow-up Questions
 
 
As regards replies given on Geographical I ndications, we have two follow-up questions: 
 
Reply to Q. 37 . In particular, we note that the case referred by New Zealand was based on passing-off, 
and it was notably found that a substantial proporti on of the New Zealand public would be misled by 
use of the terms Champagne or Australian Champagn e.  It was also found that there was a breach of 
Section 9 of the Fair Trading Act, which provided th at no person shall, in trade, engage in conduct 
that is misleading or deceptive or is likely to deceive or mislead.  Those findings are based on 
subjective test, i.e. assessment of whether the public would be misled or deceived.  
 It is also important to note that this case was issued prior to the entry into force of the TRIPS 
Agreement.  
In light of these remarks, could New Zealand provide other examples in New Zealand case-law 
applying the objective criteria of Article 23.1 TRIPS?    WT/TPR/M/216/Add.1 
 Page 111 
 
 
  Answer:  
The Comite Interprofessionnel du Vin de Champag ne v Wineworths Group Limited [1991 2 NZLR 
432] case is the most recently reported case in  New Zealand concerning misleading or deceptive 
conduct in regards to a geographical indication. 
 Reply to Q.38
: In its answer, New Zealand  notes that "R egistration of geographical indication under 
the Geographical Indications (Wine and Spirits) Regi stration Act 2006 would, therefore, effectively 
be equivalent to establishing re putation and goodwill necessary for taking action against misleading 
and deceptive use of a geographical indi cation under the Fair Trading Act." 
 
Could New Zealand explain whether any action agains t the illegitimate use of a GI registered pursuant 
to the Geographical Indications (Wine and Spirits ) Registration Act 2006 will need to be taken under 
the Fair trading Act? Will it still be necessary to br ing evidence of misleading or deceptive use of the 
GI?  Answer:
 
There is no requirement under the Geographical Indi cations (wines and Spirits) Registration Act 
2006 (the "GI Registration Act") for an aggrieved party to also bring action under the Fair Trading 
Act for misuse of a registered GI.  Action against misuse of a registered GI under the GI Registration Act would not require the aggrieved party to bring evidence of misleading or deceptive use of the 
registered GI, rather evidence that  accused person’s use of the registered geographical indication in 
trade was contrary to provisions under sections 21 to  24 that set out when a registered GI may be 
used.    Furthermore, it should be noted that there is no pr ovision in the GI Registration Act that would 
prevent an aggrieved party seeking simultaneous relief fr om the courts under both the GI Registration 
Act and the Fair Trading Act to remedy misuse use of a registered GI. 
 
As regards replies on agricultural sector, we have one follow question: 
 Replies to question Q.29-30
:  We note that the replies seem to be incomplete.  As noted in 
Question 30, there are 11 designated markets for dairy quotas, but the replies only refer to the EU, US 
and Dominican Republic market.  
 Could New Zealand confirm the market share of Fonterra in the other designated markets?  
 
Answer:
 
Access to the following tariff quotas have been completely deregulated:  Canada butter, Japan 
cheese, and US cheddar cheese, NSPF cheese and Ameri can-type cheese where NZ cannot designate 
the importer.  From the 2010 quota year, quota for prepared edible fat to Japan will be entirely 
reallocated to dairy processors based on their share of raw milk collect ed from dairy farmers.  Out of 
quota trade will be restricted until quota is filled. There are no export restrictions on any other dairy products to any other markets. 
  
BRAZIL – Add 1
 
 
Q4-2 What are the top ten beneficiaries of New Z ealand's GSP, and what are their respective shares 
in preferential imports?  How have their sh ares developed during the last five years? 
 
Answer:  
The top ten beneficiaries of New Zealand's GSP (ba sed on the average value of imports for the five-
year period 2004-2008) are China, Malaysia, Thailand, Indonesia, Morocco, Saudi Arabia, India, WT/TPR/M/216/Add.1 
Page 112  
 
  Mexico, Brazil and the Philippines.  Please refer to  the sheet labeled "Top 10 Value" for further 
details.  For details of their respective shares in preferential imports, please refer to the sheet labeled 
"Value Qualified for Pref". 
 
For details of how these shares have developed duri ng the last five years, please refer to the sheet 
labeled "Estimated Shares for 2004 and 2006".  Please note that these figures are estimates only, and 
have been calculated by estimating the Value of Imports for Least Developed Countries and Less 
Developed Countries qualified for preference, and the gr owth rate relating to the value of imports 
qualified for preference. 
 
Q12 What percentage of imports of New Zeala nd is covered by goods and services from Less and 
Least developed countries supporte d on preferential trade tariffs? 
 
Answer:
 
We assume that this question is intended to add ress goods trade only (as services trade is not subject 
to tariffs).   In 2008 the figure was 8% (please refer to the sheet labelled 'Value Qualified for Pref').   
 
VALUE OF IMPORTS QUALIFIED FOR PREFERENTIAL DUTY, 2004-2008 
Beneficiaries 2004 2005 2006 2007 2008 % Shares in 
Preferential 
imports 
Brazil 25,171,864 29,591,727 49,508,069 67,373,316 27,573,983 1  
Indonesia 133,663,720 137,027,810 174,202,102 176,280,879 177,201,578 5  
India 75,566,419 86,237,211 96,263,140 105,625,965 107,846,505 3  
Morocco 142,550 233,393 68,855 29,607,188 163,510,664 5  
Mexico 6,550,414 6,338,913 8,277,973 6,826,789 6,744,802 0  
Malaysia 137,326,416 153,612,855 198,880,426 230,936,233 297,868,718 9  
Saudi Arabia 9,914,208 9,457,199 14,189,948 91,284,586 175,545,940 5  
Thailand 204,874,366 281,499,334 436,196,094 460,795,006 633,325,730 18  
China 751,421,306 980,692,862 1,398,948,748 1,663,133,846 1,586,197,442 46  
Philippines 31,774,860 53,833,491 62,783,216 61,216,266 38,522,684 1  
Total 1,376,406,123 1,738,524,795 2,439,318,571 2,893,080,074 3,214,338,046 93  
Growth rate   26 40 19 11   
Value of Imports 
Qualified for Pref 
Duty from all Least and Less Developed 
Countries (2008) 1,489,605,251 1,876,902,617 2,627,663,665 3,126,919,762 3,470,880,936  100  
Value of Total 
Imports (2008) 38,527,993,071    40,697,935,505   44,804,882,417.00    
Percentage of 
imports from Less 
and Least Developed 
Countries (2208)           8  
Note: "This data will differ from official  trade statistics produced by Statistics NZ which are subject to editing and compiled  according 
to international standards." 
 
ECUADOR – Add. 1  
 
Q1 According to the Report of the Secretariat, for the recognition of most-favoured-nation status, New Zealand requires an eight-digit tariff disaggregation.  However, the Harmonized System to which it refers only provides for six.  WT/TPR/M/216/Add.1 
 Page 113 
 
 
  Could New Zealand please clarify this apparent contradiction? 
 
Answer:  
The New Zealand tariff is applied at the HS 8-digit level.  That means countries exporting to NZ are 
asked to use an 8-digit code so tha  the most a ccurate match to the NZ tariff can be made.  The 
International Convention on the Harmonized Commod ity Description and Coding System states that 
contracting parties are not prevented from estab lishing "subdivisions classifying goods beyond the 
level of the Harmonized System, provided that any such subdivision is added and coded at a level 
beyond that of the six-digit numerical code set out in the Annex to this Convention".  New Zealand's 
8-digit tariff structure complies with this provision.   
 
Q2 The purpose of the preferential schemes recognized by New Zealand is to promote exports of products with a high value-added c ontent from developing countries.  However, at the same time 
New Zealand maintains its tendency towa rds tariff escalation for processed goods. 
 
We would appreciate a more detailed explanation of what would appear to be a contradiction between 
preferential schemes which promote exports of products with a high value-added content from 
developing countries, and the tariff escalation that New Zealand maintains with  regard to the more 
processed products.  According to the Secretariat Report,  this is an impediment to industrialization in 
the developing countries which export to New Zealand.  Answer:
 
The Secretariat Report notes that "o verall, the tariff shows a slight  tendency to escalate" and "the 
textiles and clothing sector shows more significant ta riff escalation, although the degree of escalation 
has declined  since 2002" [Emphasis added].  The average applied rate in manufacturing across all 
tariff lines in 2002 was 4.3% and by 2008 had declined to 2.7%, indicating that the impact of any 
tariff escalation has declined significantly.  New Zealand's average tariffs on processed goods are 
relatively low.  In addition, 50 least developed (d eveloping) countries benefit from duty free entry of 
all originating goods into New Zealand, while 89 less developed countries benefit from preferential 
entry under New Zealand's Generalized System of  Preferences scheme under 462 tariff lines (15% of 
dutiable tariff lines).  New Zealand has also ne gotiated free trade agreements with several less 
developed (developing) counties, which will lead to ta riff elimination on all originating goods from 
those countries.  
 
 
__________