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The Government presented the Trade (Australia and New Zealand) Bill to the House of Commons on 11 May 2022. Second reading of the Bill is provisionally scheduled for 6 September 2022.

The Bill would enable the implementation of the UK’s Free Trade Agreements with Australia and New Zealand – the first two trade agreements that the UK has negotiated independently, outside the EU.

The Bill’s objectives

The Bill would create powers to change UK domestic procurement law to implement the public procurement chapters of each agreement. UK procurement rules, set out in procurement regulations and guidance, regulate government and wider public sector purchases of goods and services.

The Bill would enable the UK Government and devolved authorities to make regulations for two purposes:

  • To implement the changes in domestic procurement law required to implement the UK Free Trade Agreements with Australia and New Zealand, and
  • To change domestic law to reflect some specific amendments required under the agreement with Australia, and apply those provisions to suppliers from the UK and other countries. This aims to ensure consistent regulation and treatment of all suppliers.

Parliament’s role

The UK Government has prerogative powers to negotiate international agreements. However, some agreements may require changes to domestic law and these have to be agreed by Parliament. Agreements cannot be ratified and entered into force before this legislation is passed.

Besides passing implementing legislation, Parliament will formally scrutinise the trade agreements under the Constitutional Reform and Governance Act (CRAG), and has power to delay the ratification of the agreements. On 20 July, this process was concluded for the UK Australia Free Trade Agrement.

Procurement provisions

In the UK Australia and the UK New Zealand Free Trade Agreements, countries have committed to ensuring fair, transparent and non-discriminatory selection processes of suppliers. They have agreed to open up their procurement markets allowing suppliers to bid for more contracts of wider public sector bodies. It is unclear how significant the improvements are compared to the current situation.

Some obligations of the procurement chapters go beyond the World Trade Organisation Government Procurement Agreement (GPA) – of which the UK, Australia and New Zealand are part. These include innovative provisions on advertising and conducting procurement electronically, and helping small companies bid for tenders.

The Government’s view is that where the text of the agreements deviates from the GPA and might seem to reduce commitments (PDF), this was unlikely to have negative effects on suppliers (PDF).

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