Incorporating wide-ranging CPTPP into domestic law

November 18, 2021 | 10:46
It can be said that the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is the first agreement since joining the World Trade Organization (WTO) that requires Vietnam to carry out lawmaking activities to implement such wide-ranging commitments.
Nguyen Thi Thu Trang - Head, Center for WTO and International Trade under the VCCI
Nguyen Thi Thu Trang - Head, Center for WTO and International Trade under the VCCI

Amending, supplementing, and developing new domestic legal regulations (lawmaking) to implement commitments in the CPTPP are among the key tasks in Vietnam’s joining of the agreement. The main objectives of these lawmaking activities are to ensure the compatibility of domestic legislation and to organise implementation of these commitments in practice.

According to the plans from the National Assembly and the government, there is a total of seven laws, six decrees, and six circulars that need to be revised or newly developed. Since 2019, a total of 11 legal documents were issued to implement the commitments with immediate effect and four documents were drafted to prepare for it with schedules.

Regarding the legal documents issued to implement commitments with immediate effect, there is a total of 11 documents in this category, in which there are eight documents to internalise CPTPP commitments on trade in goods and three documents on the rules. These documents include a total of 63 groups of commitments under eight chapters and two bilateral letters.

In order to incorporate the CPTPP into domestic laws, there are seven legal documents that were internalised in the way of building a new document with the specific scope and subjects of application (six documents on trade in goods, one document on government procurement); three documents amending and supplementing existing legal documents, and one case included in the overall amendment draft of a relevant document.

During the drafting process, all legal documents were published to collect comments from the public. However, in many cases, the drafting agency only published documents without any attached explanations for policy choices of draft provisions, which causes certain difficulties for relevant stakeholders to understand and give comments. There are 7 of 11 drafts sent by drafting agencies to the Vietnam Chamber of Commerce and Industry for collecting businesses’ comments. In these cases, the drafts were more widely known by businesses and, at the same time, collected more focused and effective comments.

Eight documents were drafted and issued in 2019 and three documents issued in 2020. Although they were all drafted and issued in a shorter time compared to the normal process under the Law on Promulgation of Legal Documents, if compared with the milestone of January 14, 2019 required by the CPTPP, each of these documents were issued 246 days late on average.

Despite that, there are five documents that ensure compliance with the effective time of CPTPP through regulations on retroactive effect; two documents taking effect later than January 14, 2019 but to enforce Vietnam’s rights (not obligations) under the CPTPP; two documents guiding the implementation that were directly applied from the same date; and two documents taking effect later than that date but there were already documents guiding the temporary implementation since the agreement came into force, or their late effect did not affect the interests of partners or related stakeholders.

Although the effective date required is still guaranteed, the slow issuance of implementation documents has had certain impacts on the ability of Vietnamese businesses to take advantage of this agreement in the first stage. This may be one of the reasons why the exploitation of the CPTPP by Vietnam in the first two years of implementation has not met expectations.

Most of the provisions in these legal documents are compatible with the related CPTPP commitments. In most cases (tariff preferences, rules of origin, technical measures), this compatibility is ensured through transferring almost all texts or core content of commitments to domestic regulations, or with only small adjustments to ensure the technical consistency and sequence harmonisation in the relevant domestic mechanism.

Some provisions internalising CPTPP commitments in Vietnam’s documents have contents exceeding the standards, implementing them at a higher level than required or with an earlier roadmap (for example, requirements on transparency in bidding procedures). In some cases, the internalisation provisions have made certain adjustments compared to the requirements of the original commitments in terms of scope and conditions in order to ensure harmony, rationality, and consistency in the context of Vietnam’s domestic legislation.

In addition, there are still a few cases where regulations/mechanisms are not enough to ensure the implementation of CPTPP commitments in practice and therefore they need to be adjusted to ensure compliance or need to be developed timely, for example, the specific mechanism on employee representative organisations in enterprises in labour law.

Based on the review of lawmaking activities for carrying out the CPTPP, activities implementing other free trade agreements need to be considered to broaden their objectives, not only to fulfil the promises with partners, but also to go beyond that - developing legislation to meet our own internal needs in the process of agreement integration, thereby supporting businesses and the economy to take full advantage for the comprehensive and sustainable development of Vietnam.

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