WORLD TRADE  
ORGANIZATION  WT/REG266/3 
8 February 2011 
 (11-0638) 
Committee on Regional Trade Agreements Original:   English 
  
 
FREE TRADE AGREEMENT BETWEEN CHINA AND NEW ZEALAND  
(GOODS AND SERVICES) 
 
Questions and Replies
 
 
 
 The following communication, dated 22 December 2010, is being circulated at the request of 
the delegations of China and New Zealand.   This document reproduces the follow-up
 questions addressed to the Parties following the 
59th Session of the CRTA and the responses submitted. 
 
_______________ 
  
Questions from the Delegation of Australia
 
 
Trade in Goods  
 1. How do the Parties view the free trade agreement (FTA) outcomes in relation to 
obligations under GATT Article XXIV, including the elimination of duties and other restrictive 
regulations of commerce on substantially all th e trade within a reasonable length of time 
(ten years)?  We note that 223 tariff lines on th e Chinese side are not subject to eventual tariff 
elimination, and many of these exemptions appear  to retain high tariff peaks or are subject to 
tariff rate quota (TRQ) treatment.  Examples in clude a number of pulp and paper product lines 
and the retention of high tariff peaks on a rang e of products including vegetables, chemicals, 
processed food and textiles.  We understand that a number of these categories are likely to be of 
trade interest to New Zealand exporters. 
 The FTA provides for comprehensive tariff elimin ation as laid out in the Annex 1 of the FTA. 
By 2016, 100% of tariff lines a nd 100% of goods imported from China to New Zealand will be 
tariff-free.  By 2019, 96% of goods imported from New Zealand to China will be tariff-free. 
 2. The maintenance by China of a Country Specific TRQ (CSTRQ) for nine tariff lines 
covering wool and wool tops includes an arra ngement whereby exports outside the CSTRQ will 
be traded under the global TRQ - with this remaining in place beyond 2017: 
(a) What impact is this expected to have on  New Zealand's exports to China of these 
goods? 
 This is expected to have a positive imp act on New Zealand wool exports to China. 
    WT/REG266/3 
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  (b) What have been the fill rates for the CSTRQ since implementation? 
 As New Zealand no longer manufactures wool t ops, the CSTRQ for wool tops has not been 
utilised.  The CSTRQ for wool was filled in 2009 and the official notification of fill rates for 2010 is 
not yet available.   
(c) Have these increased in line with increases specified in the text? 
 Wool exports to China are growing at a faster  rate than the rate of CSTRQ expansion in 
Annex 4 of the FTA.   
(d) Is there a process for re-allo cation of unused quotas? 
 Yes.  The process for re-allocation of u nused quota is consistent with China's Detailed Rules 
for Implementing the Administration on Import Tariff Quotas of Wool  and Wool Tops in 2007  and 
subsequent revisions or successor rules.    
(e) Are there implications for other countries exporting wool products to China 
under the global TRQ? 
 This is a matter for other countries exporting wool products to China to assess.   
 
3. The FTA also has a bilateral safeguards m echanism which potentially reduces the value 
of concessions given that tariffs of safeguarded goods can have their tariff increased back to the 
MFN rate subject to a time limit.  Has this mechanism been applied so far?  
 No.  
 
Rules of Origin
 
 4. The approach to the Product Specific Rules of Origin (PSR ROO) in the FTA for goods 
is based primarily on changes in the tariff cl assification (CTC) of the inputs through the 
production process in China/NZ or both.  Could the Parties explain why there are exceptions to 
the straight CTC approach for a range of good s, including where a CTC PSR is supplemented 
by a Regional Value Content (RVC); and there are also a very small number of goods where origin is solely decided according to an RVC cr iteria (e.g. 330112 essential oil of oranges).   
 The overall approach to Rules of Origin was based on CTC rules.  Any deviations from the 
CTC approach reflected either a desire to have alternative rules or particular sensitivities by the 
negotiating Parties.   
Trade in Services
 
 
5. Given that the sectoral coverage closely follows each Party's GATS commitments, with 
only modest improvements, can the Parties comment on whether the FTA has "substantial 
sectoral coverage" according to GATS Article V.1.a? 
 The Parties have made substantial commitments on services that go beyond their respective 
GATS commitments in a range of sectors, covering m odes 1-3 of engagement.  The FTA also binds in 
the Parties' existing GATS commitments in all sector s.  Under mode 4, the Agreement establishes 
measures to facilitate the movement of business pe ople between the Parties.  The Committee on Trade 
in Services will convene in 2011 to conduct, inter alia , the review of the implementation of the  WT/REG266/3 
 Page 3 
 
 
  Services chapter, including the possibility of exte nsion of MFN treatment to sectors not listed in 
Annex 9.   
(a) Could the Parties provide information on the trade in affected sectors prior to 
entry into force and any changes in this  since the services sector commitments 
made in the FTA have come into force? 
 It is difficult to measure the specific economic effect of the outcome of the services 
component of the FTA due to the difficulty in collecting sufficiently disaggregated data on a sectoral basis upon which to base quantitative analysis.  Anec dotal evidence collected in the process of the 
two year review of the FTA showed that bilateral services trade has grown in the past two years, and 
exchanges are taking place in a wider range of  sectors than when the FTA was signed.  
 
(b) Can the Parties provide their liberali zation plan for these sectors?  
 The services schedules to the FTA provide the agreed liberalization plan.  The Committee on 
Trade in Services will convene in 2011 to conduct, inter alia , the review of the implementation of the 
Services chapter, including the possibility of exte nsion of MFN treatment to sectors not listed in 
Annex 9.  
 
6. There is a commitment in the FTA to review, two years after entry into force, the 
implementation of the services chapter and to consider other trade in services issues "of mutual 
interest", including the extension of MFN treatm ent to additional services sectors not listed in 
Annex 9, with a view to the progressive liberalizat ion of the trade in services between them ...". 
 Could the Parties report if there have b een any developments in relation to this 
commitment, particularly in relation to key sectors of international services trade such as 
financial services and professional services?   
 The Parties have not yet conducted their c onsultations on the possible extension of MFN 
treatment beyond the sectors listed in Annex 9, alth ough the implementation of Services commitments 
was discussed at both Joint Commission meetings .  The Committee on Trade in Services will convene 
in 2011 to conduct, inter alia , the review of the implementation of the Services chapter, including the 
possibility of extension of MFN treatment  to sectors not listed in Annex 9.  
 
Investment
 
 7. Could the Parties provide information on the implementation of Article 141.2, whereby 
Parties progressively remove non-conforming meas ures on existing investments - has any action 
been taken pursuant to this provision? 
 No action pursuant to this provision has taken place. 
 
General FTA Review
 
 8. Under Chapter 15 of the FTA an FTA Joint Commission is required to meet within two 
years after the entry into force of the Agreement (1 October 2010) .  The Joint Commission is 
mandated to consider implementation and "explo re measures for the further expansion of trade 
and investment between the Parties."  Could the Parties provide any information on developments in relation to the Joint Commission, or on any of the other potential bodies or processes of review in the FTA? WT/REG266/3 
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   The FTA Joint Commission has met twice, in August 2009 and in November 2010.  Both 
meetings reviewed the implemen tation and operation of the FTA including hearing reports from 
meetings of other FTA committees (including the SPS committee, TBT committee, and Movement of 
Natural Persons committee) and considering furt her implementation and cooperation activities to 
enhance uptake of the benefits of the FTA.  
 
 The mandated two year review of the FTA took place in 2010, and was finalized at the second Joint Commission in November.  The review found that the FTA continues to provide a sound and comprehensive platform from which to promot e and develop bilateral trade and investment. 
Substantial progress to date in implementing th e FTA was welcomed, and targeted ongoing work 
programmes across the FTA were identified. 
 
Questions from the Delegation of the European Union
 
 
Merchandise Trade  
 
9. Given the fact that this Agreement has been  already for more than two years in force, 
since 1 October 2008, could the Parties indicate  how much bilateral trade flows have been 
impacted since?  Could the Parties indicate  whether there has been any noticeable trade 
diversion effect? 
 Total two-way merchandise trade between the Par ties grew to NZ$9.6 billion in the first year 
of the FTA being in force (according to New Zeala nd statistics).  This represented an increase of more 
than 20% in two-way trade in one year, which was significant when compared to the overall 
contraction of 7% in New Zealand's two-way trade w ith the rest of the world.  In the year ending 
September 2010, total two-way trade was NZ$10.4 billion, representing year-on-year growth of 
approximately 8%. 
 
 Total bilateral commodity trade between the Parties increased continuously from US$2.679 
billion in 2005 to US$4.562 billion in 2009 (according to China statistics).  Affected by the global 
financial crisis, the growth rate of total bilatera l trade declined in 2008.  However, it remained 
positive and was higher than the growth rate of  China's total trade in the same year.  
 
 China's importance to New Zealand as a tradi ng partner has grown in relative and absolute 
terms. According to New Zealand statistics, Ch ina is now New Zealand's second-largest trading 
partner overall, as well as second-largest source of im ports and second-largest destination for exports.  
New Zealand's importance as a trading partner for China has also grown with New Zealand's share of China's total trade of China rising from 0.17% in 2007 to 0.21% in 2009. 
 
Trade in Services and Investment
 
 10. In paragraph 11, it is reported that "[f]or reasons of confidentiality, only data for 2005 
are available for inward investment".  Therefore,  data for inward investment in New Zealand 
for the years 2006, 2007 and 2008 have not been provided.  
 Could New Zealand give some details regardi ng the potential problems of facilitating 
this information?  
 Bilateral investment figures for China are not available for years 2006-2008 because the 
figures do not pass New Zealand Statistics confidentiality rules.     WT/REG266/3 
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   New Zealand's Statistics agency is legally bound to maintain the confidentiality of a 
respondent as stipulated in the Statistics Act 1975.  Statistics New Zealand considers a cell 
confidential if an enterprise or individual contributin g to that cell is possibly able to be identified if 
that information is published.  As New Zealand is a relatively small economy, there are often 
situations where one or two enterprises (or indi viduals) dominate an investment activity.  This 
situation is particularly relevant in bilateral data .  The calculation on whether a cell is confidential is 
based on a "p% rule"; if an enterprise or individual's  contribution to a cell can be estimated to within 
p% of the actual value by other contributing enterprises, a cell's value is suppressed.   
Background information
 
 
11. Paragraph 14 indicates that the Agreement is  composed of 18 Chapters.  One of these 
Chapters relates to Cooperation.  In particular , Article 177 of the Cooperation Chapter refers 
to the Memorandum of Understanding on La bour Cooperation and the Environmental 
Cooperation Agreement that the Parties have concluded together with the FTA 
(http://chinafta.govt.nz/1-The-agreement/1-Key-outcomes/index.php ).  
(a) Could the Parties elaborate on this, and whether any particular cooperation 
activities have been set up under this header yet?  
 The Memorandum of Understanding (MoU) on Labour Cooperation and the Environment 
Cooperation Agreement are separate Agreements to  the FTA.  For more information please see the 
Parties' websites. 
 
(b) Could the Parties or the WTO Secretariat also explain why the binding 
Memorandum of Understanding on La bour Cooperation and the binding 
Environment Cooperation Agreement has not been included in Box II.1? 
 The MoU on Labour Cooperation and the E nvironment Cooperation Agreement are not 
included in Box II.1 as they are separate Agreements to the FTA.  For more information please see the 
Parties' websites.   
Liberalization of trade and tariff lines
 
 12. The Factual Presentation indicates that by the end of the implementation, in 2019, 
China would have liberalized 97.1% of the tariff lines representing 88% of imports in value, 
while New Zealand would have granted a full 100% liberalization already by 2016.  
(a) Could China elaborate on the reasons for these asymmetric commitments, 
especially in light of the fact that New Zealand is only China's 52
nd import 
partner, representing less than 0.2% of China's imports? 
 The commitments are scheduled subject to th e result of negotiation between the Parties, 
which reflects a high-level liberalization.  The b asis for trade liberalization and tariff structure 
between China and New Zealand are quite different. S ubject to the tariff lines of China, in year 2008 
before the signing of the FTA, only 8.3% of the ta riff lines are zero in terms of basic rate, while 
57.6% of New Zealand's tariff lines are zero already.  The percentage of 88% of imports in value, is still being challenged, since the Country-Specifi c TRQ on wool and wool-tops which China has 
granted for New Zealand has not been calculated into it.  By 2019, 96.6% of goods imported from 
New Zealand to China will be tariff free, given zer o tariff rate in Country-Specific TRQ on wool and 
wool-tops.    WT/REG266/3 
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  (b) Could China elaborate in particular on the reasons for not having liberalized 
118 tariff lines in Chapter X (pulp and paper)?  
 Subject to the report of the working party on the accession of China to WTO, Paragraph 91, 
for wood and paper products, the same rates of dut y, including the rates applied under a preference 
programme, customs union or free trade area, would be applied to all impor ts of wood and paper 
products.  At this development stage, China is not ready to grant any preferential commitments on 
wood and paper products in  multilateral context. 
 
Sanitary and phytosanitary measures
 
 
13. As noted in paragraph 37 of the Factual P resentation, and pursuant to Article 81.3, the 
Parties agreed to recognize each other's sanitary and phytosanitary (SPS) measures on goods if 
the exporting party objectively demonstrates that its measures reach the importing Party's standards.  
(a) Considering the increasing volume of th e imports from China, how will New 
Zealand assure it will continue to maintain its high SPS standards, especially 
given the EU's SPS Agreement with New Zealand? 
 New Zealand's SPS measures are risk-based.  No access is granted on any product that could 
compromise New Zealand's SPS standards.   
(b) We note that a Joint Management Co mmittee has been established already 
under the FTA.  What is the priority  order for considering market access 
requests from each Party? 
 The Parties maintain a priority list for mana ging work programs in respect of requests for 
market access from the other Party.  At any one time, 3-5 items from each Party are on that list.   
(c) Is New Zealand considering or has it considered a request to recognize the 
equivalence of Chinese SPS measures for any specific products yet? 
 No request to recognize the equivalence of  Chinese SPS measures for any specific product 
has been made to date.   
(d) Have there been any discussions to est ablish a Sanitary/Veterinary Agreement 
between the Parties? 
 No discussions to establish a Sanitary – Vete rinary Agreement have been held to date. 
 
14. In paragraph 38, it is reported that the Part ies shall have the right to audit and verify 
the procedures of the exporting Party.  Furth ermore, "the Parties may share the results and 
conclusions of the audit and verification  procedures and checks with non-Parties." 
 Could the Parties confirm whether they h ave already undertaken SPS verification 
missions?  If so, has either Part y already shared the results with  non-Parties, for instance by 
posting mission reports on the internet?  
 No formal verification visits have been undertaken so far.  
   WT/REG266/3 
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  Technical Barriers to Trade  
15. According to Article 97.5, and as reported in paragraph 44 of the Factual Presentation, 
each Party shall accredit or otherwise recognize co nformity assessment bodies in the territory of 
the other Party on terms no less favourable than  those it accords to conformity assessment 
bodies in its territory. 
 Have either Party already recognized any co nformity assessment bodies in the territory 
of the other Party? 
 
 Both sides are in the process of recognizi ng conformity assessment bodies.  New Zealand has 
recognized China Quality Certification Center  (CQC) as the certification body in China. 
 16. As reported in paragraph 45 of the Factual Presentation, the Parties can request 
technical consultations on the application of an y technical regulation or the recognition of any 
standard or conformity assessment procedure. 
 Have any consultations occurred on the application of any technical regulation or 
recognition of any standard or conformity asses sment procedure occurred?  If so, could the 
Parties provide the relevant details?  
 
 No technical consultations have been held to date.  That said, under the provisions of the EEE 
MRA, both Parties have established an open chan nel of communication and have engaged in a 
number of regulatory dialogues and technical discussions .  This has been helpful to further strengthen 
confidence and mutual understanding of the respective regimes. 
 
17. Paragraph 46 of the Factual Presentation no tes that pursuant to Article 100, the TBT 
Chapter provides for the establishment of a Joint Committee, inter alia , to set up working 
groups to consider issues relating to:  WTO enquiry  and notification points;  standardization;  
and accreditation and conformity assessment; and to identify priority sectors for enhanced 
cooperation, including giving favourable consider ation to any sector-specific proposal made by 
a Party.  
 Has the Joint Committee met yet and set up any TBT-related working groups?  If so, 
could the Parties please elaborate? 
  The Technical Barriers to Trade (TBT) Joint Committee has been established to promote and 
monitor the implementation of the TBT Chapter, and two meetings have been held to date.  While no 
formal TBT-related working groups have been set up to date, experts in the area of consumer product 
safety have been working together on developing  an arrangement in this area.  Work on the 
Arrangement on Cooperation in the Fi eld of Consumer Produc ts Safety was initiated by the TBT Joint 
Committee in 2009 and was signed in June of this year.  
 
Safeguard mechanisms
 
 18. The Agreement sets up specific safeguard me asures for each Party, such as the 
possibility to exclude each others' products from  global safeguard meas ures providing they are 
non-injurious.  Bilateral safeguards have also been planned, but are only provisory and subject 
to compensation.  Furthermore, the Agreement contains special safeguards for China on imports of dairy products from New Zealand in the form of a higher tariff.  
 
 WT/REG266/3 
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  (a) Has a Party excluded the other's product(s ) from global safeguard measures and 
if so, how was the exemption defined as "non injurious"?  If so, please elaborate on the details.  
 The question of whether any product has been  excluded from global safeguard measures is 
not applicable since no global safeguard measure has been applied by either Party since the 
Agreement entered into force. 
 
(b) Have any bilateral safeguards been applied or under consideration?  Was any 
compensation provided?  If so, please elaborate on the details.  
 Since no bilateral safeguard measure (which was prescribed under Chapter 6: Trade Remedies 
of the Agreement) has been applied to date, the question of how the compensation issue was 
considered is not applicable.  
(c) Has the volume of the 11 dairy tariff lines from New Zealand ever exceeded the 
quantity-based trigger level and if so, has New Zealand received any 
compensation for the application of a sp ecial safeguard on its imports of dairy 
products to China?  
 In 2009, the volume of seven dairy tariff lines from New Zealand exceeded the quantity-based 
trigger level and China applied special safeguard me asures to those products according to the Article 
13 of the agreement. In 2010, due to the rapid grow th of dairy import, the volume of 11 dairy tariff 
lines all exceeded the trigger line and China app lied Special Safeguards accordingly on 9 April, 
17 April, 12 June, and 2 September respectively.  The Special Safeguards were covered by Article 13 
of the Agreement, which did not address the compensation issue.   
National Treatment in investment
 
 
19. We note that pursuant to the provision agreed in the framework of the FTA, New 
Zealand agreed to accord national treatmen t to Chinese investments. However, recent 
developments in New Zealand, notably in the co ntext of the New Zealand's Overseas Investment 
Review, point to a likely trend towards increased restrictions on foreign direct investment.  
 Could New Zealand explain to what degree these trends are consistent with the good 
functioning of the FTA?  
  The national treatment commitment in the investment chapter does not extend to pre-
establishment activities, such as the requirement fo r certain investments to obtain permission under 
the Overseas Investment Act.  Movement of natural persons
 
 20. The Agreement improves movement of natu ral persons in two domains: temporary 
entry of natural persons and temporary employm ent of natural persons. Only New Zealand has 
committed itself to improve the latter. Althou gh temporary employment entry shall not be 
denied on the basis of the labour market a nd economic situation of the country, New Zealand 
has set up strict numerical restrictions on the entrance of Chinese workers.  
 
   WT/REG266/3 
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   Are the Parties intending to liberalize further the entry requirements for the movement 
of natural persons?  
 The numerical restrictions on Chinese workers apply to FTA categories for Temporary 
Employment Entry. Chinese nationals are eligib le to apply for temporary entry under normal 
immigration policies. 
 
 Any further liberalization measures would be  decided upon by the Committee on Movement 
of Natural Persons. 
 
Liberalization commitments in trade in services
 
 
21. China's schedule of commitments for services in the FTA with New Zealand contains 
references in 28 sectors to limitations under mode 3 which will be removed within a certain time 
span from "Chinese accession".  
 Assuming that this is a copy of the Chinese WTO commitments schedule, could China 
explain why these have not been removed sin ce the Agreement with New Zealand was agreed 
after these limitations had already lapsed?  
 The Chinese WTO commitments schedule it self doesn't influence the substantial 
liberalization level and timeframe for removing some restrictions. 
 22. Overall the Chinese commitments for serv ices only cover new or improved 
commitments in seven services sectors/sub-sector s. In particular, there are only new/improved 
commitments for mode 1 in two subsectors:  Project management services other than for construction (CPC 86601) and for maintenan ce and repair services of motor vehicles 
(CPC 61120).  Overall this presents a picture of limited sectoral coverage understood in terms of 
number of sectors, volume of trade affected and modes of supply covered.  
 Could China explain how this limited num ber of new/improved commitments is in 
accordance with the conditions established in Article V GATS on economic integration? 
 
 The commitments of service schedule covers all sectors and the new or improved commitments are very substantial, which reveal th e spirit of progressive liberalization by taking into 
the consideration of current status in term of service  trade between the Parties.  The Areement itself is 
a living agreement by setting up the review clause.  Along with the implementation of the Agreement, 
both Parties are committed to looking into the possibilities of further liberalization in certain sectors, which are deemed as necessary and of mutual interests. 
 
Exceptions
 
 23. According to Article 202.1, and as reported in paragraph 112, the Parties can take 
measures for balance-of-payments purposes for:  trade in goods in accordance with GATT 1994 
and the WTO Understanding on the Balance-of-P ayments of GATT 1994;  trade in services in 
accordance with GATS;  and investments. 
 Has there been an understanding between the Parties on a maximum time period for 
'temporary' balance of payment safeguard measures? 
 
 The Parties' intention is to keep the issue of balance-of-payments fully consistent with related 
rules of the WTO. 
 WT/REG266/3 
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  Intellectual property rights
 
 24. In paragraph 125 of the Factual Presentation, it is indicated that notifications on new 
intellectual property laws and information exch anges regarding developments in intellectual 
property policy shall be channelled through the Pa rties' contact points.  Through the contact 
points, the Parties may request consultations on any issues within the scope of the Chapter to 
the other Party although a Party may deny the request, pursuant to Articles 166.1, 166.2 and 166.5.  Once initiated, if a Party considers that th e consultation fails to resolve the issue, it may 
invoke Chapter 16 on dispute settlement after noti fication to the other Party of the decision. 
 Could the Parties provide more details regardi ng the application of this mechanism?  
  The mechanism of IPR has been clearly displa yed in the Agreement.  In the two years of 
implementation, no case has been put forward by any party.  The rules are same as the rules under the 
DSU of WTO.  Cooperation
 
 25. As indicated in paragraphs 127 and 128 of the Factual Presentation, the Agreement 
explores ways of tightening links between th e Parties, through cooperation on small and 
medium-sized enterprises and the implementation of a Doctoral Research Scholarships Programme.  
 What initiatives will the Parties take to reinforce the cooperation of their small and 
medium-sized enterprises?  
 The conclusion of the Agreement between the Parties provided a broad platform for business 
sectors to intensify economic and trade relations, esp ecially for those enterprises that are determined 
to explore the commercial opportunities in New Zealand or vice versa. Since SMEs are playing an 
important role in today's economic circumstance, the inclusion of SME cooperation is necessary for making the FTA more comprehensiv e and economically relevant.  
 
 In the past two years, the Parties jointly launched a series of activities in helping the 
enterprises, including SMEs, to enhance the utili zation of the FTA. 2010 saw an unprecedented level 
of business exchanges from both countries including from SMEs. Shanghai World Expo was a 
catalyst for the record number of business exchanges to  help create a platform in China for business 
promotion and cooperation. 
 
 The Parties have also cooperated actively to  promote the FTA to business and other public 
constituents in both countries through two large seminars.  
 
 In May 2010, a joint high-level seminar with th e topic of "Leadership in  trade policy: China- 
New Zealand FTA"on the FTA was held in Shanghai,  at which the New Zealand Minister of Trade 
and China's Vice Minister Yi Xiaozhun participated.  
 
 In June 2010, a joint seminar on the FTA was held in honour of the visit to New Zealand by 
the Vice President of China, Xi Jinping in Auckland. The seminar attracted an audience of 400 
business leaders from both New Zealand and China, and included eight speakers from leading businesses and industries who have benefitted from the FTA.   
 
  WT/REG266/3 
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   Beside the joint promotion activities, China also promotes China's SMEs to actively going 
abroad and acquiring more experiences in intern ational competition and cooperation. Technical 
assistances and information sharing are provided through seminars, workshops which are conducted 
by certain industrial associations or governmental agencies. The main initiative of SME cooperation is 
concentrated on helping the domestic industries to familiarize the business climate of the other Party, 
and more initiatives shall be discussed in the futu re between the Parties through various channels. 
 
Questions from the Delegation of the United States  
Relationship with other agreements concluded by the Parties  
26. Table V.2 on page 36 does not list China' s agreement with Chinese Taipei, which we 
understand is now in force.  Could China plea se indicate when it intends, along with 
Chinese Taipei, to notify th is agreement to the WTO? 
 No reply has been received to date.  The reply will be circulated at a later stage. 
 
27. Also with regard to Table V.2 on page 36, could New Zealand indicate if the 
SPARTECA Agreement is still in force?  We request  that New Zealand also confirm that this 
Agreement is notified under the Enabling Clause, as is indicated in this table.   
 We confirm that the SPARTECA Agreement is still in force and that it was notified under the 
Enabling Clause in 1981. 
 
Services and Investment  
 
28. Paragraph 104 of the Factual Presentation not es that the Parties to the Agreement have 
agreed to encourage relevant authorities to expl ore possibilities for recognition of qualifications 
and professional and vocational licenses. 
 Could the Parties describe the nature of their "encouragement" to relevant 
New Zealand and Chinese authorities (pursuant to Article 113.3 of the Agreement);  the types of 
strengthened cooperation that have resulted fr om such encouragement;  and the outcomes of 
such strengthened cooperation in terms of recognition of qualifications and professional and vocational licenses? 
 As mandated in Article 113.2, the New Zeala nd Qualifications Authority (NZQA) and the 
Ministry of Human Resources and Social Security (previously named Ministry of Labour and Social 
Security) of China have established a Joint Work ing Group (JWG) to advance mutual recognition of 
vocational qualifications. 
 
 The Parties first met in New Zealand in N ovember 2009 to discuss the establishment of the 
JWG and NZQA tabled the terms of reference.  At a second meeting in Beijing in April 2010, the 
Parties exchanged detailed information on each othe rs' qualifications systems, with a view to 
identifying specific qualifications from each Party to  be considered for formal recognition by the 
other Party.  The terms of reference for the obj ectives and operation of the JWG were agreed in 
November 2010.  
29. Paragraph 69 of the Factual Presentation no tes that, pursuant to 124 of the Agreement, 
the Parties shall consult within two years of  entry into force of the Agreement to review 
implementation of the services Chapter and cons ider other issues of mutual interests, with a 
view to the progressive liberalization of bilatera l trade in services.  Paragraph 69 also describes 
the cooperative arrangemen ts between the Parties pursuant to Article 122. WT/REG266/3 
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  (a) With respect to Article 124, can the Pa rties describe the outcome of their 
(presumably recent) consultations, in particular with respect to the extension of MFN treatment to additional sectors not listed in Annex 9, and with respect to progressive liberalization of trade in services between them?  
 The Parties have not yet conducted their c onsultations on the possible extension of MFN 
treatment beyond the sectors listed in Annex 9, a lthough the implementation of services commitments 
was discussed at both Joint Commission meetings. The Committee on Trade in Services will convene 
in 2011 to conduct, inter alia , the review of the implementation of the services chapter, including the 
possibility of extension of MFN treatment  to sectors not listed in Annex 9.  
 
(b) With respect to Article 122, can the Part ies describe how they have sought to 
implement the obligation upon them to "strengthen cooperation efforts in services sectors"? 
 One of the key tasks of the Parties is to further promote the understanding of FTA for the 
business circles of both countries. In the past two years, the Parties jointly launched a series of 
activities in helping the enterprises, including service suppliers of both Parties, to enhance the 
utilization of the preferential arrangement under FTA framework.  Year 2010 has seen an 
unprecedented level of business exchanges from both countries including from those in the services 
sector.  Shanghai World Expo was a catalyst for th e record number of business exchanges to help 
create a platform in China for the promotion and c ooperation in education, tourism and other services 
sectors.  
 Education cooperation has intensified with  a range of new academic connections and 
initiatives since the FTA entered into force.  This  cooperation includes the development of tripartite 
research agreements between Universities and the deepening of relationships between education 
institutions.  The Parties signed a Tourism Coope ration Arrangement in April 2009 which deepened 
cooperation in this sector.  
 
 The Parties have cooperated actively to prom ote the FTA including trade in services, to 
business and other public constituents in both count ries through two large seminars. In May 2010, a 
joint high-level seminar with the topic of "Leadersh ip in trade policy: China- New Zealand FTA" was 
held in Shanghai, at which the New Zealand Minister of Trade and China's Vice Minister Yi 
Xiaozhun participated.  In June 2010, a joint semi nar on the FTA was held in Auckland in honour of 
the visit to New Zealand by the Vice President of China, Xi Jinping. The seminar attracted an 
audience of 400 business leaders from both New Zeal and and China, including from services sectors. 
 
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