Services are an important part of New Zealand’s economy, accounting for two-thirds of economic activity and 70% of employment. Our service sector exports were worth over $20 billion in 2015.

World Trade Organization members are bound by the rules of the General Agreement on Trade in Services (GATS), though new challenges to services trade have emerged since the GATS was signed in 1995. TiSA aims to update the rules to reflect this new trading landscape. It can be viewed as a major Free Trade Agreement for services only. It does not include trade in goods or other areas like intellectual property.

Who is involved?

There are 23 participants in the TiSA negotiations, all members of the WTO: Australia, Canada, Chile, Colombia, Costa Rica, the European Union (representing the 28 EU countries), Hong Kong, Iceland, Israel, Japan, Korea, Liechtenstein, Mauritius, Mexico, New Zealand, Norway, Pakistan, Panama, Peru, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei), Switzerland, Turkey, and the United States.

TiSA participants collectively account for 70% of global services trade.

Why it’s a priority for New Zealand

Services are an important part of New Zealand’s economy, accounting for two-thirds of economic activity and 70% of employment. New Zealand’s service sector exports were worth NZ$17 billion in 2014; about 25% of our total exports of goods and services. Services exports are any services we sell to overseas customers. They include New Zealand companies doing work for overseas clients, as well as services sold in New Zealand to foreigners.

TiSA markets account for around 80% of New Zealand’s commercial services, and include four of our top five services markets: Australia, United States, United Kingdom and Japan.

There is growing demand overseas for New Zealand expertise and innovation in environmental services, tertiary education, air services, IT, and a wide range professional services such as engineering, architecture and services associated with agriculture. TiSA negotiators are discussing ways to make the supply of these services into TiSA markets easier and more efficient, while preserving the fundamental right for the New Zealand government to regulate for legitimate public policy purposes.

What are the potential benefits?

TiSA could help our services exporters by broadening the scope of business activities they can do in TiSA markets. A range of different service sectors are currently being discussed, including  financial services, ICT services (including telecommunications and e-commerce), professional services, transport services, and  temporary entry of business people.

Negotiations also aims to help service providers by seeking to:

  • remove barriers to supplying services from New Zealand to international markets through the Internet
  • remove requirements to work in joint venture with local firms
  • remove restrictions on the number of branches or locations
  • ease restrictions on the ability of business people to travel to deliver their services
  • facilitate professional services by addressing burdensome registration procedures and working to ensure qualification and professional registration processes are clear and transparent
  • remove quotas on numbers of foreign staff

Timing for the negotiations

At the 14th round of negotiations held in Geneva from 30 November to 4 December 2015, negotiators made good progress on the domestic regulation, transparency and financial services annexes. Discussions were also held on temporary entry of business persons and market access.

How to get involved

MFAT negotiators are keen to hear from service sector businesses and investors about how we can make it easier for you to do business in TISA markets. Please let us know if you experience any of the following restrictions in these markets, or have any other issues you would like us to consider:

  • restrictions affecting services delivered through the internet (eg online education, consultancy for professional services), including laws that require your business to have a physical presence in the overseas market
  • requirements to obtain local licences; difficulty getting your professional experience or qualifications recognised
  • requirements to operate joint ventures with local partners
  • limitations on the ability to open new businesses or invest in companies operating in TISA markets
  • requirements to employ locals; restrictions on the ability to transfer New Zealand staff to the overseas market; residency or nationality requirements for company directors
  • difficulties in obtaining visas
  • having to compete with local firms that benefit from government preferential treatment
  • complex or discriminatory local regulations.

To get more information about the TiSA negotiations, or send us feedback:

Email  serviceexports@mfat.govt.nz

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