(c) improving the effectiveness of domestic regulation; and
(d) facilitating innovation, including the adoption of new technologies and dealing with the risks and opportunities arising out of those new technologies,
while furthering public policy objectives, and ensuring certainty and predictability for businesses.
2. The Parties affirm the importance of undertaking regulatory cooperation in the most efficient way, having regard to the full range of regulatory cooperation activities. Activities include considering unilateral recognition or adoption and less formal arrangements such as information sharing and joint capacity building, along with equivalence, harmonisation, and mutual recognition.
3. The Parties recognise the value of regulatory cooperation, both bilaterally and in concert with other trading partners. The Parties may, whenever practicable and mutually beneficial, approach regulatory cooperation in a way that is open to participation by other international trading partners. Each Party may also, whenever practicable and mutually beneficial, approach regulatory cooperation with other international trading partners in a way that is open to participation by the other Party. The Parties may share information and, where appropriate, take a coordinated approach to influencing regulatory settings in non-parties and the development of international models in international fora.
4. Where a Party is engaging in regulatory cooperation activities with a non- party, it is encouraged to give positive consideration to a request from the other Party to participate in this activity.
Article 21.12. Regulatory Cooperation Activities
1. Regulatory cooperation activities may include:
(a) information exchanges, dialogues, or meetings between policy officials;
(b) formal cooperation, including mutual recognition, equivalence, or harmonisation;
(c) engaging with interested persons, including business and consumers; and
(d) other activities that the Parties may agree.
2. Where the Parties agree to engage in a regulatory cooperation activity, and where they agree it is appropriate, each Party shall endeavour to:
(a) inform the other Party of the development of new regulatory measures or the revision of existing regulatory measures that are relevant for the regulatory cooperation activity;
(b) on request, provide information and discuss measures that are relevant for the regulatory cooperation activity; and
(c) consider, when developing new regulatory measures or revising existing regulatory measures, any regulatory approaches by the other Party on the same or a related manner.
3. The Parties acknowledge the importance of regulators having a mandate and powers that enable them to cooperate with each other. Each Party shall endeavour to encourage informal cooperation between its regulators and their counterparts in the other Party to address barriers to trade and investment.
4. The regulatory cooperation contact points in Article 21.13 (Contact Points on Regulatory Cooperation) shall endeavour to:
(a) proactively identify potential opportunities for undertaking regulatory cooperation between regulatory authorities of the Parties;
(b) consider regulatory cooperation activities that respond to business concerns or issues raised by regulatory authorities, where those concemis or issues are not solely addressed in other Chapters of this Agreement; and
(c) prioritise those cases that would reduce regulatory barriers for SMEs or best support the efficient operation of value chains that operate between the Parties, including those that extend into other regions.
5. The contact points shall endeavour to ensure that regulatory cooperation activities under this Chapter add value in addition to any related initiatives underway in other relevant fora or other Chapters of this Agreement.
Article 21.13. Contact Points on Regulatory Cooperation
1. Each Party shall designate and notify a contact point on regulatory cooperation, to facilitate communication and cooperation between the Parties on any regulatory cooperation matter covered by this Chapter.
2. Each Party shall promptly notify the other Party of any change to its regulatory cooperation contact point.
Article 21.14. Relation to other Chapters
In the event of any inconsistency between this Chapter and another Chapter of this Agreement, the other Chapter shall prevail to the extent of the inconsistency.
Article 21.15. Dispute Settlement
Neither Party shall have recourse to dispute settlement under Chapter 31 (Dispute Settlement) for a matter arising under this Chapter.
Chapter 22. ENVIRONMENT
Article 22.1. Definitions
For the purposes of this Chapter:
"2030 Agenda" means the UN 2030 Agenda for Sustainable Development adopted by the UN General Assembly Resolution 70/1 on 25 September 2015, and its Sustainable Development Goals;
"CITES" means the Convention on International Trade in Endangered Species of Wild Fauna and Flora done at Washington, D.C. on 3 March 1973;
"environmental law" means a law or regulation of a Party, or provision thereof, including any that implements the Party's obligations under a multilateral environmental agreement, the primary purpose of which is the protection of the environment, including the mitigation of climate change, or the prevention of a danger to human life or health, through:
(a) the prevention, abatement, or control of: the release, discharge, or emission of pollutants or environmental contaminants including greenhouse gases;
(b) the control of environmentally hazardous or toxic chemicals, substances, materials, or wastes, and the dissemination of information telated thereto;
(c) the protection or conservation of wild flora or fauna, including endangered species, their habitat, and specially protected natural areas; (1) (2) or
(d) the protection, preservation, and enhancement of natural water resources,
but does not include laws or regulations, or a provision thereof, directly related to worker safety or health nor any laws or regulations, or provision thereof, the primary purpose of which is managing the subsistence or aboriginal harvesting of natural resources;
"Montreal Protocol" means the Montreal Protocol on Substances that Deplete the Ozone Layer done at Montreal on 16 September 1987;
"Paris Agreement" means the Paris Agreement done at Paris on 12 December 2015 by the Conference of the Parties to the UNFCCC at its 21st session; and
"UNFCCC" means the United Nations Framework Convention on Climate Change done at New York on 9 May 1992.
Article 22.2. Maori Environmental Concepts
In order to acknowledge the special relationship of Maori with the environment in New Zealand, the Parties include the following concepts for the purposes of this Chapter:
"kaitiakitanga" refers to the Maori concept of active stewardship, guardianship, and protection of our natural surroundings (land, sea, water, and air), and of the mauri of the environment; and
"mauri" refers to the essential quality and vitality of a being or entity. It is also used for a physical object or ecosystem in which this essence is located. All objects have mauri. A waterway, for example, or a mountain have a mauri including through their connection to the land.
Article 22.3. Context and Objectives
1. The Parties recall the Agenda 21 and the Rio Declaration on Environment and Development adopted by the UN Conference on Environment and Development in 1992, the Johannesburg Plan of Implementation of the World Summit on Sustainable Development of 2002, the Outcome Document of the UN Conference on Sustainable Development of 2012 titled The Future We Want endorsed by the UN General Assembly Resolution 66/288 adopted on 27 July 2012, and the 2030 Agenda.
2. The objectives of this Chapter are to promote mutually supportive trade and environmental policies; promote high levels of environmental protection and effective enforcement of environmental laws; encourage the Parties to address the urgent threat of climate change; and enhance the capacities of the Parties to address trade or investment-related environmental issues, including through cooperation.
3. The Parties recognise that:
(a) sustainable development encompasses economic development, social development, and environmental protection, all three being interdependent and mutually reinforcing, and affirm their commitment to promote the development of international trade and investment in a way that contributes to the objective of sustainable development;
(b) enhanced cooperation to protect and conserve the environment and sustainably manage their natural resources brings benefits that can contribute to sustainable development, strengthen their environmental governance, and complement the objectives of this Agreement;
(c) the urgent need to address climate change, as outlined in the Intergovernmental Panel on Climate Change Special Report on Global Warming of 1.5°C, is a contribution to the economic, social, and environmental objectives of sustainable development; and
(d) the environment plays an important role in the economic, social, and cultural well-being of Maori in the case of New Zealand, and acknowledge the importance of engaging with Maori in the long-term conservation of the environment.
Article 22.4. General Commitments
1. The Parties recognise the sovereign right of each Party to establish its own environmental priorities and levels of environmental protection relating to the environment, including mitigation of and adaptation to climate change, and those which a Party establishes pursuant to the multilateral environmental agreements to which it is a party, and to establish, maintain, or modify its relevant law and policies accordingly.
2. Each Party shall endeavour to ensure that its environmental and other relevant law and policies provide for, and encourage, high level of environmental protection, and to continue to improve its respective level of environmental protection.
3. Without prejudice to paragraph 1, the Parties recognise that it is inappropriate to encourage trade or investment by weakening or reducing the protection afforded in their respective environmental laws. Accordingly, a Party shall not waive or otherwise derogate from, or offer to waive or otherwise derogate from, its environmental laws in a manner that weakens or reduces the protection afforded in that law in order to encourage trade or investment between the Parties.
4. Neither Party shall fail to effectively enforce its environmental laws through a sustained or recurring course of action or inaction to encourage trade or investment between the Parties.
5. The Parties recognise that each Party retains the right to exercise discretion and to make decisions regarding:
(a) investigations, prosecutions, and regulatory and compliance matters; and
(b) the allocation of environmental enforcement resources with respect to other environmental laws determined to have higher priority.
Accordingly, the Parties understand that with respect to the enforcement of environmental laws, a Party is in compliance with paragraph 4 if a course of action or inaction reflects a reasonable exercise of that discretion, or results from a bona fide decision regarding the allocation of those resources in accordance with priorities for enforcement of its environmental laws.
6. The Parties further recognise that it is inappropriate to establish or use their environmental laws in a manner which would constitute a disguised restriction on trade or investment between the Parties.
Article 22.5. Multilateral Environmental Agreements
1. The Parties recognise the important role multilateral environmental agreements play in protecting the environment, including reducing biodiversity loss and addressing climate change, and the need to enhance the mutual supportiveness between trade and environmental laws and policies.
2. Each Party affirms its commitment to implement the multilateral environmental agreements to which it is a party.
3. In accordance with Article 22.19 (Cooperation) the Parties shall cooperate as appropriate with respect to environmental issues of mutual interest related to multilateral environmental agreements, in particular trade-related issues, including:
(a) exchanging information on the implementation of multilateral environmental agreements to which a Party is a party;
(b) exchanging information on ongoing negotiations of new multilateral environmental agreements; and
(c) exchanging each Party's respective views on becoming a party to additional multilateral environmental agreements.
Article 22.6. Climate Change
1. The Parties recognise the importance of achieving the objectives of the UNFCCC and the Paris Agreement in order to address the urgent threat of climate change, and the role of trade and investment in pursuing this objective, and commit to working together to take actions to address climate change. The Parties recognise that nothing in this Agreement prevents a Party from taking measures to fulfil its commitments under the UNFCCC and the Paris Agreement provided that such measures are not applied in a manner that would constitute a means of arbitrary or unjustifiable discrimination against the other Party or a disguised restriction on trade. The Parties reaffirm their right to make use of the general exceptions and general provisions in Chapter 32 (General Exceptions and General Provisions), recalling their understanding that the measures referred to in Article XX(b) of GATT 1994 and Article XIV(b) of GATS include environmental measures necessary to protect human, animal or plant life or health and measures necessary to mitigate climate change, and that Article XX(g) of GATT 1994 applies to measures relating to the conservation of living and non-living exhaustible natural resources.
2. Accordingly, the Parties affirm their commitment to implement the Paris Agreement and to take action to reduce greenhouse gas emissions with the aim of strengthening the global response to climate change by holding the increase in global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels, and their ambition of achieving their respective domestic net zero targets by 2050, and shall:
(a) promote the mutual supportiveness of trade, investment, and climate policies and measures;
(b) facilitate and promote trade and investment in goods and services of particular relevance for climate change mitigation and adaptation; and
(c) promote carbon pricing as an effective policy tool for reducing greenhouse gas emissions efficiently, and promote environmental integrity in the development of international carbon markets.
3. In accordance with Article 22.19 (Cooperation) the Parties shall cooperate bilaterally and in international fora, including at the WTO and the UN, to address matters of mutual interest with respect to trade-related aspects of climate change policies and measures, and on ways to mitigate and adapt to climate change, that may include:
(a) implementation of the Paris Agreement;
(b) international trade-related aspects of the fight against climate change, such as carbon leakage and systems of carbon pricing, and linking emissions trading schemes;
(c) supporting the development, adoption, and implementation of ambitious and effective greenhouse gas emissions reduction measures by the International Maritime Organization to be implemented by ships engaged in international trade;
(d) supporting the development, adoption, and implementation of ambitious and effective greenhouse gas emissions reduction measures by the International Civil Aviation Organization; and
(e) policies, laws, and measures that can contribute to a reduction in greenhouse gas emissions and increased climate resilience and ways to mitigate and adapt to climate change.
Article 22.7. Environmental Goods and Services
1. The Parties recognise the importance of facilitating trade and investment in environmental goods and services, including clean technology, as a means of improving environmental and economic performance, contributing to clean growth and jobs, and encouraging sustainable development while addressing global environmental challenges including climate change.
2. Accordingly, each Party shall:
(a) eliminate customs duties on originating goods of the other Party upon entry into force of this Agreement on HS six-digit subheadings containing the environmental goods listed in Annex 22A (Environmental Goods List), (3) in accordance with Chapter 2 (National Treatment and Market Access for Goods) and Annex 2A (Schedule of Tariff Commitments for Goods). The Environment and Climate Change Sub-Committee established under Article 30.9 (Sub- Committees - Institutional Provisions) shall keep this list under review, in conjunction with other relevant committees established under this Agreement, as appropriate, and may make recommendations to the Joint Committee for modifications to Annex 22A (Environmental Goods List). In keeping this list under review, the Environment and Climate Change Sub-Committee may consider factors such as the extent to which a good contributes to the clean growth and sustainable development objectives of the Parties, advances in available technologies, any potential dual-use of proposed environmental goods, relevant multilateral or plurilateral developments, and other environmental and climate factors; and
(b) facilitate and promote trade and investment in environmental goods and services, and endeavour to address any potential tariff and non-tariff barriers to such trade and investment that may be identified by a Party, including by working through the Environment and Climate Change Sub-Committee and in conjunction with other relevant committees established under this Agreement, as appropriate.
3. In accordance with Article 22.19 (Cooperation) the Parties shall cooperate on ways to enhance trade in environmental goods and services. Areas of cooperation may include:
(a) renewable and low carbon energy;
(b) energy efficient products and services;
(c) clean transport including uptake of electric vehicles;
(d) energy storage technologies;
(e) sustainable financial services;
(f) clean heat;
(g) carbon capture, utilisation, and storage;
(h) climate change adaptation and resilience technologies and services;
(i) conservation of biological diversity, pollution abatement, and water conservation; and
(j) identification of, and further liberalisation of trade in, environmental services.
4. The Parties acknowledge that achieving the objectives of the UNFCCC and the Paris Agreement requires collective action. Accordingly, the Parties shall also cooperate in international fora, including at the WTO and under the UN Environment Programme, on ways to further facilitate and liberalise global trade in environmental goods and services.
Article 22.8. Fossil Fuel Subsidy Reform and Transition to Clean Energy
1. The Parties recognise the need to reduce the use of fossil fuels and to support the global transition to clean energy in order to further the implementation of the Sustainable Development Goals of the 2030 Agenda and the objectives of the UNFCCC and Paris Agreement. The Parties further recognise that fossil fuel subsidies can distort trade and investment, disadvantage renewable and clean energy, encourage wasteful consumption, and contribute significantly to global greenhouse gas emissions.
2. Accordingly, each Party shall:
(a) take steps to eliminate harmful fossil fuel subsidies where they exist, with limited exceptions in support of legitimate public policy objectives;
(b) as fellow members of the Powering Past Coal Alliance, end unabated coal-fired electricity generation in their territories as part of a clean energy transition aligned with the goals of the Paris Agreement;
(c) encourage the transition to clean energy for electricity, heat, and transport;
(d) ensure that information on fossil fuel support measures, including any subsidies, is published;
(e) end new direct financial support, such as officially supported export credits, for fossil fuel energy in non-parties, except in limited circumstances where it:
(i) meets a legitimate policy goal, such as improved safety or environmental standards; or
(ii) supports a clean energy transition aligned with the goals of the Paris Agreement;
(f) end international aid funding for fossil fuel energy except in limited circumstances where it is not feasible to provide access to energy solely from renewable sources and the aid:
(i) is essential as part of a humanitarian response;
(ii) is to meet a legitimate policy goal such as improved safety or environmental standards; or
(iii) supports a clean energy transition aligned with the goals of the Paris Agreement; and
(g) encourage non-parties to develop and undertake best practice approaches to fossil fuel subsidy reform.
3. The Parties shall cooperate bilaterally and in relevant international fora such as the WTO, UNFCCC, and G20 in relation to fossil fuel subsidy reform and the transition to clean energy.
Article 22.9. Marine Capture Fisheries (4)
1. The Parties recognise the importance of kaitiakitanga in conserving and sustainably managing fisheries and the mauri of marine ecosystems, and the role of trade in pursuing these objectives.
2. The Parties acknowledge their roles in the marine fisheries sector and recognise the importance of the conservation and sustainable use of fisheries resources and marine ecosystems, and the role of trade in pursuing these objectives.
3. In this regard, the Parties acknowledge that inadequate fisheries management, fisheries subsidies that contribute to overfishing and overcapacity, and illegal, unreported and unregulated ("ITUU") fishing (5) threaten fish stocks, the environment, trade, and livelihoods, and recognise the need for individual and collective action to end such practices.
4. Accordingly, each Party shall operate a fisheries management system designed to:
(a) prevent overfishing and overcapacity;
(b) reduce bycatch of non-target species and juveniles;
(c) promote the recovery of overfished stocks; and
(d) minimise adverse impacts on associated marine ecosystems.
Such a management system shall be based on the best scientific evidence available, the precautionary approach, an ecosystem-based approach, and internationally recognised best practices as reflected in relevant international instruments.
5. Each Party shall promote the long-term conservation of sharks, marine turtles, seabirds, marine mammals, and other species recognised as threatened in relevant international agreements to which each Party is a party.
6. The Parties recognise that the implementation of a fisheries management system that is designed to prevent overfishing and overcapacity and to promote the recovery of overfished stocks must include the control, teduction, and eventual elimination of all subsidies that contribute to overfishing and overcapacity or IUU fishing. To that end, neither Party shall grant or maintain any of the following subsidies (7) within the meaning of Article 1.1 of the SCM Agreement that are specific within the meaning of Article 2 of the SCM Agreement:
(a) subsidies for fishing (8) that negatively affect (9) fish stocks that are in an overfished (10) condition;
(b) subsidies for the transfer of fishing vessels (11) from the United Kingdom or New Zealand to other States, including through the creation of joint enterprises;
(c) subsidies for operations that increase the fishing capacity of a fishing vessel, or for equipment that increases the ability of a fishing vessel to find fish, except where they meet legitimate public policy goals such as improved safety or sustainability;
(d) subsidies provided to fishing for fish stocks managed by a Regional Fisheries Management Organisation or Arrangement where the subsidising Party or vessel flag State is not a member or cooperating non-member of the Organisation or Arrangement;
(e) subsidies provided to fishing or fishing-related activities (12) conducted without the permission of the flag State where required and, if operating in another State's waters, without permission of that State;
(f) subsidies provided to any fishing vessel or operator while listed by the flag State, the subsidising Party, the FAO or a relevant Regional Fisheries Management Organisation, or Arrangement for IUU fishing in accordance with the rules and procedures of that State, Party, organisation, or arrangement and in conformity with international law; or
(g) subsidies provided to any vessel or operator that has been found to have committed a serious violation of conservation or management measures within the preceding 12 months.
7. Subsidy programmes that are established by a Party before the date of entry into force of this Agreement for that Party and which are inconsistent with subparagraphs 6(a) to subparagraph 6(c) shall be brought into conformity with that paragraph as soon as possible and no later than three years after the date of entry into force of this Agreement for that Party.
8. In relation to subsidies that are not prohibited by subparagraphs 6(a) to subparagraph 6(g) and taking into consideration a Party's social and developmental priorities, each Party shall make best efforts to refrain from introducing new, or extending or enhancing existing, subsidies within the meaning of Article 1.1 of the SCM Agreement, to the extent they are specific within the meaning of Article 2 of the SCM Agreement, that contribute to overfishing, overcapacity, or IUU fishing.
9. With a view to achieving the objective of eliminating subsidies that contribute to overfishing and overcapacity, the Parties shall review the disciplines in paragraph 5 within the Environment and Climate Change Sub- Committee, including their implementation, two years after the date of entry into force of this Agreement and thereafter at intervals not exceeding five years unless the Parties agree otherwise.
10. Each Party shall notify the other Party within one year of the date of entry into force of this Agreement and every two years thereafter of any subsidy within the meaning of Article 1.1 of the SCM Agreement that is specific within the meaning of Article 2 of the SCM Agreement that the Party grants or maintains to persons engaged in fishing or fishing-related activities.
11. These notifications shall cover subsidies provided within the previous two year period and shall include the information required under Article 25.3 of the SCM Agreement and the following information: (13)
(a) programme name;
(b) legal basis and granting authority for the programme;
and, to the extent possible,
(c) catch data by species in the fishery for which the subsidy is provided;
(d) status of the fish stocks in the fishery for which the subsidy is provided (for example, overfished, fully fished, and underfished);
(e) fleet capacity in the fishery for which the subsidy is provided;