April 7, 2015
Proposed Trans-Pacific Partnership
Overview
Country Participation
What is it? The TPP is a potential “comprehensive and
The TPP originated from FTA negotiations among Brunei,
high-standard” free trade agreement (FTA) among 12
Chile, New Zealand, and Singapore. The United States
countries, most recently including Japan, which aims to
joined in 2008 and membership has since expanded. Most
liberalize trade in goods and services and remove barriers to
recently, Japan joined the negotiations in July 2013, during
foreign investment. The TPP negotiations cover a range of
the 18th round in Malaysia. This followed Japan’s official
trade topics and include 29 separate sections or “chapters.”
request to participate and required the consent of the then-
11 TPP countries.
What is the current status? The negotiations remain
ongoing. TPP Ministers and Leaders met on the sidelines of
The United States is the largest country in the negotiations,
the APEC meetings in Beijing, November 7-11, but no
both in terms of population and gross domestic product
agreement was reached, despite President Obama’s
(GDP), with Japan second in both categories (Figure 1).
suggestion of such an outcome earlier in the summer. TPP
The United States has existing FTAs in place with six of the
Leaders stated that finishing the negotiations is a top
other TPP countries, including Canada and Mexico. It does
priority and Trade Ministers reported that the pace of
not have an FTA with Brunei, Japan, Malaysia, New
negotiations has accelerated and outstanding issues are
Zealand, or Vietnam.
limited, but include state-owned enterprises, environment,
intellectual property, and investment, as well as market
Figure 1. TPP Country Demographics
access talks with Japan, particularly on agriculture and
autos. There is no public text of an agreement available at
this time, but TPP Leaders released a broad outline of TPP
goals on the sidelines of the 2011 APEC forum meetings.
“. . [a] common vision to establish a comprehensive,
next-generation regional agreement that liberalizes
trade and investment and addresses new and
traditional trade issues and 21st-century challenges.”
TPP Leaders Statement, November 2011
How would it differ from other U.S. FTAs? First, the
TPP would be the largest regional FTA ever negotiated by
the United States in terms of member countries and
encompassed trade flows. Second, the TPP includes
negotiations on new or expanded commitments on issues
such as state-owned enterprises, global value chains, data
flows, and discriminatory regulatory barriers. Third, TPP
partners envision a “living” agreement that could continue
to incorporate new members and address new trade issues.
What are supporting views? Supporters see an

opportunity for increased geopolitical and economic
Source: IMF World Economic Outlook, 2014. Graphic created by
engagement with the Asia-Pacific region, through both
CRS.
establishing new rules and gaining increased market access.
They also cite the potential for increased economic and job
Key Negotiating Issues
growth through greater trade liberalization.
Market Access. TPP partners are seeking a comprehensive
What are opposing views? Opponents are concerned about
market access agreement that reduces and eliminates tariff
increased import competition from TPP countries in
and non-tariff barriers on all goods, including agriculture,
specific sectors and potential negative employment impacts
and services.
in such sectors. They have also voiced concerns over
potential infringement on U.S. sovereignty including the
Rules. The TPP partners also seek to establish disciplines
ability to regulate health, labor, and environmental
and rules governing international trade practices among the
standards.
parties, across a range of policy issues.
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Proposed Trans-Pacific Partnership
New and Horizontal Issues. TPP partners are negotiating
greater market access and disciplines for trade in financial,
potential disciplines that go beyond those in existing U.S.
professional, e-commerce, telecommunications, and express
FTAs or negotiations at the World Trade Organization
delivery services.
(WTO). These new or expanded disciplines may cover
broad categories such as competition with state-owned
State-Owned Enterprises (SOEs). A new issue of focus in
enterprises and regulatory coherence, as well as specific
the TPP, U.S.-proposed SOE disciplines seek to address
issues such as data flows, where U.S. companies claim new
concerns expressed by U.S. companies of a competitive
trade restrictions have emerged.
disadvantage relative to state-backed foreign competitors.
In addition, negotiators have flagged certain topics, such as
Economic Significance
global supply chains, that relate to disciplines in multiple
•
chapters of the negotiations. They are reportedly
The TPP would be the largest FTA by trade-flows,
though 82% of U.S.-TPP goods and 69% of U.S.-TPP
approaching each TPP chapter with consideration for how
services trade is covered under existing U.S. FTAs.
its disciplines may affect these cross-cutting issues.
• Total U.S. trade with TPP countries was $1.6 trillion in
Specific Issue Areas
goods in 2014 and $274 billion in services in 2013.
• The 11 TPP partners accounted for 37% of all U.S.
Agriculture. Agriculture is an important component of U.S.
goods and services trade in 2013 (Figure 2).
trade and is being addressed in TPP negotiations in terms of
market access in which the United States has both offensive
More Information
and defensive interests, as well as rules, such as sanitary
and phytosanitary standards (SPS).
Figure 2. Shares of 2013 Total U.S. Trade
Customs and Trade Facilitation. Access to foreign markets
depends on facilitating the movement of goods and services
across borders. The TPP includes negotiations on
disciplines that seek to address these issues.
Dispute Settlement. Provisions on dispute settlement
establish the mechanism by which FTA disciplines are
enforced. Not all disciplines of the TPP would necessarily
be enforceable and hence subject to these provisions.
Government Procurement. Government procurement
disciplines aim to ensure transparent, nondiscriminatory
treatment toward domestic and foreign firms when
government entities make purchasing decisions. Debate in
the TPP continues on the range of procurement to be
covered.
Intellectual Property Rights (IPR). Intellectual property
rights protect U.S. innovations in various forms. TPP
negotiations may address the strength of IPR protections in

areas such as trademarks, copyright, patents, trade secrets,
Source: Analysis by CRS. Data from ITC and BEA.
and others as they relate to traded goods and services.
Notes: TPP-9 refers to Australia, Brunei, Chile, Malaysia, New
Zealand, Peru, Singapore, and Vietnam; TPP-11 adds Canada and
Investment. In addition to goods and services, U.S. FTAs
Mexico; and TPP-12 adds Japan.
also include provisions governing investment flows. A key
issue is the possible inclusion of an investor-state dispute
For more information see CRS Report R42694, The Trans-
settlement (ISDS) mechanism.
Pacific Partnership (TPP) Negotiations and Issues for
Congress. Also see CRS Report R42344, Trans-Pacific
Labor and Environment. Labor and environment provisions
Partnership (TPP) Countries: Comparative Trade and
attempt to address concerns over the protection of workers’
Economic Analysis; CRS Report R42772, U.S. Textile
rights and the environment. Debate continues on their scope
Manufacturing and the Trans-Pacific Partnership
and enforceability in the TPP.
Negotiations; and CRS Report RL33743, Trade Promotion
Authority (TPA) and the Role of Congress in Trade Policy.
Rules of Origin. Rules of origin determine how goods with
components from non-TPP countries are treated and will
Brock R. Williams, bwilliams@crs.loc.gov, 7-1157
affect the degree of market openness that is achieved.
Ian F. Fergusson, ifergusson@crs.loc.gov, 7-4997

Services. As one of the most competitive sectors of the U.S.
economy, U.S. FTAs typically cover services through
IF10000
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