RCEP Agreement Officially Signed
On 11 November 2020, the Regional Comprehensive Economic Partnership (RCEP) Agreement was officially signed by 10 member countries of the Association of Southeast Asian Nations (ASEAN) and 5 of its major trading partners, i.e. China, Japan, South Korea, Australia and New Zealand. The conclusion of the RCEP Agreement will help shape the world’s largest free trade bloc and boost the recovery and development of the regional and global economies.
The RCEP Agreement consists of 20 chapters (including Trade in Goods, Rules of Origin, Customs Procedures and Trade Facilitation, Trade Remedies, Trade in Services, Temporary Movement of Natural Persons, Investment, Intellectual Property, E-commerce, and etc.) and 4 annexes (Schedules of Tariff Commitments, Schedules of Specific Commitments for Services, Schedules of Reservations and Non-conforming Measures for Investment, Schedules of Specific Commitments on Temporary Movement of Natural Persons).
1. Trade in Goods
In terms of trade in goods, the tariff reduction among the parties to the Agreement is mainly based on the commitment to reduce tariff immediately or within 10 years. More than 90% of trade in goods will eventually achieve zero tariff in the region.
2. Trade in Services
In terms of trade in services, the parties to the Agreement have made commitments higher than that of their existing "ASEAN + 1" free trade agreements.
3. Investment
In terms of investment, the parties to the Agreement adopt the negative list approach for market access commitments.
4. Movement of Natural Persons
In terms of movement of natural persons, the parties to the Agreement commit that investors, intra-corporate transferees, contract service providers, accompanying spouses and dependants of various countries in the region may obtain a residence period, enjoy visa convenience and carry out various trade and investment activities if they meet the relevant conditions.
5. Entry into Force
Once ratified by 6 ASEAN countries and 3 non-ASEAN countries, the RCEP Agreement will formally enter into force. In the next step, the parties to the Agreement are committed to completing their domestic approval procedures to bring the agreement into force as early as possible.
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