UK-NZ FTA preparedness planning
Background
Free Trade Agreement negotiations between New Zealand and the United Kingdom (UK-NZ FTA) have resulted in new Tariff Rate Quotas (TRQs) for beef and sheepmeat providing preferential access at 0% into the UK. The UK-NZ FTA agreement requires ratification by the respective UK and NZ Parliaments, and subject to the UK's ongoing ratification process, the FTA is anticipated to enter into force (EIF) in early 2023. NZMB’s preparedness planning provides for quota administration processes to be ready for implementation prior to this date.
The NZ-UK FTA liberalises the UK beef and sheepmeat markets. For beef access, in year one 12,000 tonnes p.w. is provided, rising by 2,980 tonnes per year at a preferential tariff of 0% until the eleventh year at which time there is unrestricted access, subject to safeguards, until year 16. For sheepmeat, additional free access of 35,000 tonnes (carcase weight equivalent) is allowed until the fifth year in which it rises to 50,000 tonnes (c.w.e.) and becomes fully liberalised after fifteen years.
The Meat Board Act 2004 (MBA) requires the NZMB (New Zealand Meat Board) to operate an allocation mechanism system.
Preparedness planning and industry consultation outcomes
In July 2022 NZMB consulted on proposals for quota allocation mechanism(s) and cost recovery relative to its UK-NZ Free Trade Agreement (FTA) preparedness planning. UK and NZ Parliamentary processes are ongoing to legally implement the outcomes of the UK-NZ FTA. It is anticipated these processes will be concluded in time for an anticipated entry into force in early 2023. This UK-NZ FTA preparedness programme of work is to enable NZMB to stand up quota management systems for access by NZ exporters once legal processes are completed.
Following feedback from the consultation, the New Zealand Meat Board has decided:
- Quota Allocation Mechanisms for beef will include a tranche for New Entrants of 3.5% and the remainder of the quota will be allocated to those with qualifying production history and/or export history. Collectively known as General Quota Allocation.
- The inclusion of a New Entrants tranche requires a mechanism by which entities that do not qualify for an allocation by means of either a Production or Export History can access the quota.
- More information on the consultation process and outcomes can be found here.
Administration information relating to the Quota Allocation Mechanism is available in the Quota Manual here and cost recovery fees for UK FTA quotas can be found here. Click here for general information describing how the UK FTA quota is administered.
Information for New Entrants
The Quota Allocation Mechanism sets aside 3.5% of the quota for allocation to companies who have not previously exported beef to the UK (New Entrants) on a first come first served basis. Information summarising access to the new FTA quota for beef products to the UK is available here.
Consultation material circulated in July 2022 included proposals for:
- Quota Allocation Mechanism for beef access under the new UK-NZ FTA access;
- Proposal to mirror a similar quota allocation mechanism for sheepmeat – however it is noted access to this FTA quota will not be available to NZ exporters until a 90% utilisation threshold has been reached in the existing sheepmeat and goatmeat access available under World Trade Organisation (WTO) quota; and
- Cost recovery fee proposals for the new UK-NZ FTA quotas.
Next Steps
The UK Parliament has ratified UK-NZ FTA and it will enter into force on 31 May 2023.
If you wish to clarify or discuss matters in regards the provisions of beef or sheepmeat access under the NZ-UK FTA, please contact us at info@nzmeatboard.org