The Future of Deep Free Trade Agreements: The Convergence of TPP (and CPTPP) and CETA?

Abstract

Focusing on TPP, CPTPP and CETA as deep free trade agreements (FTAs) that concentrate on regulatory disciplines, this paper examines a key question concerning the future of deep FTAs: do deep FTAs converge and, if so, why? It argues that, first, deep FTAs converge in their approach to trade and investment in two crucial respects: regulatory disciplines and dispute settlement. CPTPP narrows its gap with CETA through suspending rules in arguably most controversial aspects of TPP (i.e. intellectual property and investor- state dispute settlement). Differences emerge but are not unbridgeable, and convergence varies depending on the area. Second, the reasons for the convergence include shared FTA objectives (particularly regulatory protection), the development of FTA rules from WTO norms, and other factors (e.g. the lessons drawn from previous investor-state dispute settlement experience, the inherent limit of FTAs, and membership overlap). Finally, the convergence of deep FTAs has the potential to bridge most if not all differences if there is political willingness.

Keywords: US trade approach, Free Trade Agreements, FTA, Trans-Pacific Partnership, TPP, Comprehensive and Progressive Agreement for Trans-Pacific Partnership, CPTPP, WTO