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September 2011

[A version of this posting also appeared on the The Conversation blog (28 July 2011) and then the East Asia Forum blog (30 July 2011). The former is 'an independent source of information, analysis and commentary from the university and research sector' involving 'content support' from the Go8, including the University of Sydney.]

Prime Minister Julia Gillard was one of the first among world leaders to visit Japan, over 20-23 April, after the nation was stricken on 3 March by the ‘earthquake-tsunami-radiation triple disaster’. But the Australian government was tactful and realistic in not placing high priority on progressing bilateral Free Trade Agreement (FTA) negotiations. Talks had resumed in Tokyo over 7-10 February 2011 after stalling for almost a year, but a lack of progress - particularly over agricultural market access - had then prompted respective Trade Ministers to call for a high-level political summit to regain momentum. The ‘3-11’ disaster generated more urgent priorities for the Japanese government. Indeed, reversing a commitment to decide this question by end-June, in May the Kan administration announced it would defer any decision about whether to join with the nine nations (including Australia) now negotiating an expanded Trans-Pacific Partnership (TPP) agreement.

Nonetheless, Japan has some significant incentives to resume FTA negotiations with Australia in the wake of 3-11, although the road ahead still looks rocky.

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[Slightly updated on 2 September. A shorter version of this posting appeared in a Roundtable on "The Conversation" blog (25 August 2011). It draws on research for the project, "Fostering a Common Culture in Cross-Border Dispute Resolution: Australia, Japan and the Asia-Pacific", supported by the Commonwealth through the Australia-Japan Foundation which is part of the Department of Foreign Affairs and Trade.]

Australia’s Tobacco Plain Packaging Bill passed the federal House of Representatives on 24 August, although a week before it had looked like foundering. The Bill received its second reading in the Senate today, but it should pass without further change or controversy. The Bill passed by the House has already attracted commentary, mostly lauding this admittedly well-intentioned legislation.

But the legislation stuck to the original proposal for implementation: sales will have to be in the plain packaging from 1 July 2012. So Philip Morris Asia (PMA) are likely to commence investor-state arbitration (ISA) proceedings after expiry of the 3-month “cooling off” period under Art 10 of the 1993 Australia – Hong Kong bilateral investment treaty, calculated from notification of the dispute on 27 June.

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