23 March 2018

Shane Jones’ AirNZ demands would breach the TPPA, which he supports

‘Shane Jones has been an ardent supporter of the Trans-Pacific Partnership Agreement (TPPA). His latest interventions on Air New Zealand confirm my suspicions that he has no idea what restrictions it places on what New Zealand governments can do’, says Auckland University law professor Jane Kelsey.

The State-owned Enterprises Chapter applies to enterprises, such as Air New Zealand, in which the government owns a majority of shares or can appoint a majority of directors or exercise more than 50 percent of voting rights, potentially including a ‘golden share’.

That chapter is unchanged in the TPPA-11, or CPTPP.

Article 17.4 says the government must ensure that SOEs like Air New Zealand act solely in accordance with commercial considerations, unless there is an explicit public service mandate for services that operate purely within the country. There is no such mandate for Air New Zealand.

Neither National nor Labour sought to exempt Air New Zealand from that obligation in the annex to the SOE chapter.

Professor Kelsey notes that the same constraints, and more, apply to almost all existing and future state-owned enterprises, and potentially foreclose the government’s ability to adopt a different model of state enterprises that serves multiple commercial and non-commercial objectives.

‘This is a wake-up call for Shane Jones and New Zealand First’, says Jane Kelsey.

‘The TPPA-11 imposes exactly the kind of restraints on the sovereignty of governments, at central and local government levels, that Winston Peters has railed against all his political career.’

‘If Shane Jones wants to ensure that government-owned entities serve the needs of the provinces, he and NZ First need to withdraw their support for the TPPA before it is embedded in New Zealand law’.

ends

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