The opportunities presented by the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) are very attractive to a company like Wise with a keen focus on reducing costs for our customers.
Wise is a company which helps people move money across borders. Whether you’re sending, spending or holding it we want to be your way of making international payments.
Adhering to every regulation and their different iterations across the world has a cost to our firm which then has to be passed onto customers. Operating in many markets, we’re obviously keen to ensure that our regulatory burden in each location is as little as can be reasonably expected so we can pass on the reduction in costs by way of lower prices for international payments.
That’s why the CPTPP is so exciting, it presents genuine opportunities for a UK-based company to operate in the 11 markets of the CPTPP with seamless ease, allowing us ways to reduce costs and increase convenience for our users. The thorough nature of the agreement and its ability to be expanded and tailored to developing situations makes it a very attractive trading bloc to enter into - especially for a United Kingdom which is keen to stretch its markets out both east to Asia and west to the Americas.
In particular, the chapters of the CPTPP that deal with Financial Services present genuine opportunities for firms like Wise to expand their presence in the Asia-Pacific, helping to avoid further restrictions to our establishment, engagement and servicing of customers as we move further and further into offering our products in developing and expanding markets.
The Financial Services chapter of the CPTPP, under Article 11.1(h) and 11.1(j)(ii), defines our business as one which supplies a financial service and that seeks to supply or supplies payment and money transition services as well as foreign exchange across borders.
If the UK were to become a part of the CPTPP the benefits of that section would flow directly to Wise. These could include but are not limited to:
- Non-discrimination obligations under which a TPP Party must not treat foreign investors or financial institutions less favourably than their domestic counterparts or financial suppliers from any other country.
- CPTPP Parties also may not impose certain restrictions or conditions which make it more difficult for foreign service suppliers to gain market access in their respective countries.
- CPTPP Parties are required to permit financial institutions of other TPP Parties to supply new financial services in its territory, on the basis that it would permit its own financial institutions to supply the new services.
- Subject to carve outs for various nations, CPTPP parties cannot require the appointment of individuals of any particular nationality to be senior managers, essential personnel or board members of the institution of a financial institution.
Significantly, the financial services chapter contains a "ratchet" mechanism. Meaning that where a TPP Party liberalises restrictions, the new liberalised measure becomes a part of the TPP party’s treaty commitments.
This “ratchet” mechanism means that the CPTPP is an evolving agreement which maintains its fitness for purpose even long after the signatures are made and the various parliaments agree to the treaty.
Wise, being a company founded on transparency, the language in the CPTPP which recognises the importance of transparent regulations and policies governing financial services are particularly important.
In the financial services chapter, each TPP Party commits to promoting regulatory transparency in financial services to ensure that all measures are administered reasonably, objectively and impartially.
The encouragement to proactively publish regulations in advance and provide interested parties, such as Wise, to comment on proposed regulations is a boon for companies who want to engage with reducing red tape and regulation to the betterment of our customers.
The CPTPP is an agreement which can potentially offer significant advantages to firms like Wise who are trying to expand as rapidly as possible in the Asia-Pacific region. We are very excited that as a British company we can engage with the fastest growing region in the world as an equal amongst our local peers.