New Zealand takes next step in dairy dispute with Canada

New Zealand has today notified the Canadian Government and other Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) members that it has triggered mandatory negotiations in a dairy dispute with Canada, Trade and Agriculture Minister Todd McClay announced today.

In September last year, a Panel of Arbitrators ruled in favour of New Zealand, finding that Canada had breached its obligations under the CPTPP by blocking New Zealand dairy access. Canada has failed to comply with the ruling and under the Agreement the next step is for New Zealand to request formal negotiations.

"New Zealand takes its obligations under trade agreements seriously. The CPTPP is one of the highest quality agreements signed by a group of like-minded economies," Mr McClay says.

"Parties to the agreement understood the commitments they were making when the agreement was signed, and it is important that they honour them.

"As a matter of principle, the New Zealand Government expects our trade partners to treat our exporters fairly and within the rules of our agreements. Canada is not doing that in respect to the dairy quotas that were negotiated and agreed with New Zealand."

Mr McClay says New Zealand has decided to further pursue Canada for breaching its obligations under the CPTPP by blocking New Zealand dairy exporters' access to the Canadian market.

"Canada can end this dispute by meeting its CPTPP obligations to us. If they continue to choose not to, they owe us compensation.

"Now, more than ever, it is vital that international agreements and the obligations they contain are honoured. As an exporting nation New Zealand relies on trade commitments and market access that were negotiated in good faith."

Under the CPTPP dispute settlement process, negotiations must commence within 15 days of notification.