EU-New Zealand Free Trade Agreement

The agreement removes customs duties and bureaucracy that European firms face when exporting to New Zealand.

The agreement at a glance

The Free Trade Agreement between the European Union and New Zealand, signed in Brussels on 9 July 2023, will enter into force on 1 May 2024.

More information

For further details on the EU-New Zealand trade agreement, refer to Key elements of the EU-New Zealand trade agreement. 

To explore the comprehensive text of the agreement, navigate to EU-New Zealand: Text of the agreement. The text is conveniently divided into chapters and annexes for easy consultation.

Highlights

The current (2022) EU bilateral trade with New Zealand already totals €7.8 billion a year for goods and €3.7 billion for services. The EU exports to New Zealand goods worth €5.5 billion a year and imports New Zealand products of €2.3 billion resulting in a trade surplus for the EU of €3.2 billion.

When it comes to services, the EU exports more than twice as much as it imports: €2.6 billion of services supplied by EU firms to clients in New Zealand versus €1.1 billion in services delivered to EU clients by firms from New Zealand.

According to an impact assessment on the FTA, trade between New Zealand and the EU is expected to increase by 30%, with removing tariffs alone saving businesses €140 million in duties per year. Moreover, EU investment flows into New Zealand could increase by over 80%.

The agreement:

  • creates significant economic opportunities for companies, farmers and consumers;
  • respects the Paris Climate Agreement and core labour rights, enforceable through trade sanctions as a last resort, and
  • cements EU ties with a like-minded ally in the economically dynamic Indo-Pacific region.

Key elements of the agreement

  1. Trade in goods

The agreement removes duties on all EU goods exported to New Zealand at its entry into force, including on food and drinks and particularly high duties on industrial products. It also eliminates or substantially reduces EU duties on most New Zealand goods exported to the EU.

  1. Rules of Origin

The EU and New Zealand have agreed rules of origin, which ensure that only products significantly processed in one of the parties can benefit from the tariff preferences of the agreement. The origin documentation is based on self-certification by businesses. The verification is based on contacts to the importer by local customs and may be followed by administrative cooperation between the customs authorities.

  1. Customs and Trade Facilitation

The EU and New Zealand strive to provide efficient custom procedures to traders, with adequate provisions ensuring transparency of the legislation, forms, procedures to be complied with at border, easy access to information on applied tariffs, access to contact points in case of enquiries and consultation of business prior to adoption of new customs legislations.

  1. Trade Remedies

The agreement confirms the possibility of dealing with any unfair trade between the parties by using the trade defence instruments (anti-dumping, anti-subsidy, global safeguards). The agreement also includes a bilateral safeguard mechanism, which allows the EU and New Zealand to impose temporary measures in case a significant increase of preferential imports causes, or threatens to cause, serious injury to their domestic industry.

  1. Sanitary and phytosanitary measures

The chapter on Sanitary and Phytosanitary (SPS) matters, which covers food safety, animal and plant health, antimicrobial resistance (AMR) and fraud in traded commodities upholds high standards. The agreement reaffirms the principles of the WTO SPS Agreement, including the 'precautionary principle', meaning that public authorities have a legal right to act to protect human, animal or plant health, or the environment, in the face of a perceived risk even when scientific analysis is not conclusive.

  1. Sustainable food systems

The EU and New Zealand cooperate on strengthening policies and defining programmes that contribute to the development of sustainable, inclusive, healthy and resilient food systems and to jointly engage in the transition towards sustainable food systems.

  1. Animal Welfare

The EU and New Zealand undertake to cooperate bilaterally and internationally to promote the development and implementation of scientifically based animal welfare standards.

  1. Technical Barriers to Trade

The agreement promotes transparency and the use of international standards to facilitate market access while safeguarding the levels of protection that each party deems appropriate. EU companies may prove compliance with New Zealand technical regulations by conformity assessments carried out in the EU by recognised bodies for certain sectors. New Zealand has agreed to accept EU type-approval certificates for motor vehicles and many categories of these approved in the EU do not need further certification. Marking and labelling requirements may also be carried out in the territory of the importing party, and both sides can cooperate on market surveillance issues. The agreement includes special provisions on wine and spirits to provide a platform for promoting standards in wine production and labelling, in order to increase the convergence of those standards.

  1. Investment liberalisation and trade in services

The agreement ensures a level playing field between EU service providers and their competitors in New Zealand. The services covered include a wide range of sectors and sector-specific regulatory provisions exist for delivery services, telecommunications, financial services and international maritime transport services. The agreement also contains provisions on the movement of professionals for business purposes, such as managers or specialists that EU companies post to their subsidiaries in New Zealand and their family members.

  1. Digital Trade

The agreement ensures predictability and legal certainty for businesses and a secure online environment for consumers who engage in digital trade transactions across borders and removes barriers and prevents discrimination between online and offline activities. It facilitates cross-border data flows by providing a prohibition of unjustified data localisation requirements while preserving a high level of personal data and privacy protection that is an important contributor to trust in the digital environment.

  1. Capital movement, payments and transfers and temporary safeguard measures

This chapter states that if a certain transaction is liberalised under the agreement (e.g. the establishment of a foreign direct investment enterprise) then the money necessary for the transaction must be transferred as well (e.g. the contribution of the investor to the capital of the foreign affiliate, payments in relation to other transactions, such as trade in goods). At the same time this chapter allows both sides to take measures if needed, when applying its laws and regulations for example in relation to bankruptcy, trading or dealing in securities.

  1. Government procurement

The EU and New Zealand reciprocally open up their procurement markets beyond what is already covered under the WTO Government Procurement Agreement (GPA). New Zealand allows EU companies to tender, on an equal footing with local companies, for contracts with all public authorities whose procurement is regulated by procurement rules. In return, the EU opens for New Zealand suppliers and service providers the procurement of all goods and services by central government authorities that had not yet been covered under the GPA, the procurement of health-related goods (pharmaceuticals and medical devices) by regional government entities, and the procurement of public utility providers operating in the fields of ports and airports.

  1. Anticompetitive conduct and merger control

The EU and New Zealand agreed that effective competition laws are to be maintained in both jurisdictions, which are implemented by operationally independent authorities. These authorities are to act in a transparent and non-discriminatory manner, respecting the rights of defence. The agreement also foresees cooperation between the authorities.

  1. Subsidies

The EU and New Zealand recognise that certain subsidies may distort the proper functioning of markets and harm the environment, and to that end agreed that in principle no subsidies that negatively affect competition or trade or harm the environment should be granted. Furthermore, the EU and New Zealand agreed on a comprehensive transparency mechanism by which subsidies granted to both goods and services providers should be made public.

  1. State-owned enterprises

The agreement sets out binding rules on the behaviour of state-owned enterprises, designated monopolies and enterprises granted exclusive or special privileges (SOEs). The rules ensure a level playing field by requiring the SOEs to act according to commercial considerations and non-discrimination. This means that the buying and selling decisions of the SOEs must be commercially motivated, according to market economy principles in a way that a privately owned enterprise would act.

  1. Intellectual Property

The EU and New Zealand have agreed to comprehensive intellectual property (IP) provisions for the effective protection and enforcement of IP rights that encourage innovation and creativity for the respective industries. The agreement includes provisions on copyright and related rights, trade marks, industrial designs, plant varieties and protection of undisclosed information, as well as solid provisions on IP enforcement, including border measures. Concerning geographical indications (GIs), the agreement protects the full list of EU wines and spirits and 163 of the most renowned EU food GIs, and foresees the opportunity to add more GIs in the future. This will make it illegal to sell imitations.

  1. Trade and Sustainable Development

The agreement includes a dedicated chapter on Trade and Sustainable Development (TSD) that covers labour, women’s empowerment as well as environmental and climate matters. Moreover, for the first time in the EU trade agreement, the TSD chapter foresees the possibility of trade sanctions as a matter of last resort, in case of serious violations of the core TSD commitments. It protects both parties’ right to regulate and prohibits the parties from weakening or failing to enforce their laws in order to encourage trade or investment. The agreement offers civil society organisations an active role to monitor the implementation of the agreement.

  1. Maori

The EU and New Zealand recognise the importance that all New Zealanders, including Māori, can benefit from the trade and investment opportunities that the agreement brings. Special provisions ensure facilitating cooperation on trade in Māori products and exchanging information.

  1. Involving civil society

The agreement gives civil society a prominent role in its implementation, including on the provisions on Trade and Sustainable Development. The EU and New Zealand will keep non-governmental organisations, business and employers' organisations as well as trade unions active on economic, sustainable development, social, human rights, environmental and other matters informed of how they are implementing the agreement. These civil society groups will be able to voice their views and provide input to discussions on how the trade part of the agreement is being implemented.

  1. Good Regulatory Practices and Regulatory Cooperation

The agreement promotes transparency in the regulatory process, ensuring timely information is available with public consultations, impact assessments of proposed regulatory measures and reviews of regulatory measures. Additionally, New Zealand and the EU may cooperate on regulatory activities of mutual interest.

  1. Small and Medium-Sized Enterprises

The agreement addresses the specific needs of small and medium-sized enterprises (SMEs). It requires both parties to provide information on market access on a specific SME website and creates a 'SME Contact Point' on each side to cooperate in identifying ways for these companies to benefit from the opportunities offered by the agreement.

  1. Energy and Raw Materials

The Energy and Raw Materials chapter complements the provisions of other chapters relevant to energy (goods, services and investment, technical barriers to trade, state owned enterprises, procurement) by providing significant value in a number of areas. The chapter prohibits export monopolies for energy or raw materials, prohibits unjustified government intervention in the price setting of energy goods and raw materials as well as bans export or dual pricing where export prices would be set above domestic prices.

  1. Dispute Settlement

The agreement puts in place a fair, efficient and effective mechanism to solve disputes that may arise regarding the interpretation and application of its provisions. Among other things it includes independent panellists and due process and transparency involving open hearings, the publication of decisions, and the opportunity for interested parties to submit views in writing.

Preferential Origin and Tariff Dismantling Agreement

Preferential Treatment

Mutual granting of preferential tariff rates between New Zealand and the European Union (EU) to enhance trade relations.

Tariff Dismantling

Tariff dismantling commences from 1 May 2024, in accordance with Chapter 2, Article 2.5, and Annex 2-A of the agreement.

  • New Zealand: Tariff dismantling follows the specifications in Chapter 2, Article 2.5, along with Annex 2-A, Appendix 2-A-2. Complete removal of tariffs is mandated upon the entry into force of the agreement.
  • EU: Tariff dismantling adheres to Chapter 2, Article 2.5, along with Annex 2-A, Appendix 2-A-1. Completion is expected by 2031, with certain goods subject to customs duties or enjoying duty-free treatment within allocated quotas.

Origin Regulation

Regulations concerning origin are outlined in Chapter 3, Sections A to C of the agreement, including product-specific rules of origin in Annex 3-B and Appendix 3-B-1.

  • OJ L, 2024/866, 25.3.2024, p. 51
  • Annex 3-B and Appendix 3-B-1 (Origin quotas) in conjunction with Annex 3-A (Introductory Notes)
  • OJ L, 2024/866, 25.3.2024, p. 562 (Annex 3-B)
  • OJ L, 2024/866, 25.3.2024, p. 543 (Annex 3-A)

Proofs of Origin

  • Formal: No formal proofs of origin are stipulated.
  • Non-Formal: Acceptable proofs include a Statement on Origin and importer's knowledge.
  • Text of Statement: References Annex 3-C (OJ L, 2024/866, 25.3.2024, p. 625) and, for specific products, Appendix 3-B-1 (Origin quotas: OJ L, 2024/866, 25.3.2024, p. 620). Statements on origin are permissible for multiple shipments within a 12-month period.
  • Validity: Statements of origin are valid for 12 months.
  • Exemptions: Informal declaration of origin is allowed for non-commercial transactions
    • small packages from private persons to private persons up to EUR 500 EUR (import into the EU) or NZD 1,000 (import into New Zealand)
    • travellers’ personal luggage up to EUR 1,200 (import into the EU) or NZD 1,000 (import into New Zealand)

Rules of Origin

  • General Tolerance: 10% of the ex-works price, except for products falling under HS Chapters 50 to 63, which are subject to the specific provisions of Annex 3-A
  • Threshold for Sets: 15% of the ex-works price for non-originating components.
  • Principle of Territoriality: Compliance is mandatory.
  • Non-Manipulation: Compliance is mandatory.
  • Prohibition of Drawback: Not applicable.
  • Accounting Segregation: Applicable for fungible materials and products falling under HS Chapters 10, 15, 27, 28, 29, headings 32.01 to 32.07, or headings 39.01 to 39.14, if an accounting segregation method is used.

Cumulation

Bilateral cumulation is allowed between the EU and New Zealand, facilitating streamlined trade relations.

SMEs

The SME Chapter:

• Requires both the EU and New Zealand to provide SME-relevant information on how to access and do business on each other’s markets. Such information is to be provided on one publicly-accessible digital platform, such as an SME-specifc website; and

• Requires the appointment of SME contact points on each side, who will cooperate in identifying ways for SMEs to benefit from the opportunities offered by the agreement.

This will ensure that SMEs on both sides can easily access all relevant and up-to-date information on doing and setting up business in the other Party, enhancing their ability to benefit from the FTA.

For more information:

Home — business.govt.nz – How to do business in New Zealand?

European Union - New Zealand FTA: A Guide for European SMEs

 

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Frequently asked questions

  1. When the tariff refers to weight, is it gross weight or net weight?
  2. How can I find the import duty that applies to my product?
  3. If I want to sell my product in several EU countries, are there import duties to pay each time my product enters a different country?
  4. Can I get a list of products charged at 0% import duty?
  5. Are excise duties applied at EU or at national level?
  6. How is VAT charged in the EU?
  7. How can I get approval to export fish to the EU?
  8. Does food exported to the EU have to come from an EU-authorised establishment?
  9. Do I have to pay to use My Trade Assistant for Services and Investment?
  10. In which languages in My Trade Assistant for Services and Investment available?