How the Trans-Pacific Partnership is Going to Effect Your Business

After years of negotiation, a trade agreement was reached on October 5th that will affect multiple industries and have a potentially large economic impact. The impact of the Trans-Pacific Partnership (TPP) on local Ottawa small and medium sized businesses while seemingly full of opportunity, has many others fearing it as a threat to global internet users. So why is it that a poll conducted by Innovation Research, shows that 70% of Canadians are not very familiar, or not familiar at all with what the Trans-Pacific Partnership (TPP) is?

The TPP will create a free-trade zone among 12 nations around the Pacific, making it the world’s largest. (The twelve countries that are a part of the agreement: Australia, USA, New Zealand, Canada, Singapore, Vietnam, Malaysia, Japan, Mexico, Peru, Brunei and Chile.) The countries within its scope account for 40% of the world’s economic output.

The Impact of the Agreement

It is believed that the deal will strengthen economic ties by cutting tariffs, and boosting business. The agreement address certain barriers to electronic trade; with the potential of widening the reach of e-commerce opportunities for many businesses. The government of Canada states, “the TPP Electronic Commerce Chapter ensures that Canadian companies, including small and medium-sized enterprises, will be able to take advantage of expanding online commercial opportunities.”

Certain regulations within this deal are said to be there to protect the digital economy and practices like cloud computing. In particular, national governments would be prevented from cutting off data flows, by limiting laws that require local storage of data.

The Canadian government (along with several other countries’ governments) will be unable to force an organization to store government data in local data centers. This reinvigorates the debate on data sovereignty which has been a concern of many for quite some time. It will also prohibit governments from being able to demand access to source code from companies incorporated in TPP territories. The TPP will forbid custom duties or other fees for online digital products as well.

The 12 countries have also agreed to regulate the mobile providers of the world. The TPP will commit their efforts to obtain lower global roaming charges. Their hope is that through promoting an increase in competition, access to wholesale rates as well as providing other options for those travelling, consumers will benefit from a reduction in fees that are charged when using their phones abroad. This has the possibility of being of great value to many, as the 12 countries that have made this agreement are some of the most traveled to destinations in the world.

Cause for Concern?

At first glance, the TPP sounds like it could help countless small and medium-sized businesses expand their reach. But many are concerned that it could result in jobs being shipped overseas. It also important to note that the special status Canada and Mexico previously held with the United Sates exclusively will likely be weakened under the TPP; as all 12 countries would now share the perks.

Those opposed to the TPP are worried it could pose a serious threat to internet users. Specifically in regards to copyright infringements, privacy and how intellectual property is treated online. For instance laws that previously required that Canadian data to stay in Canada, will presumably have to be reversed. This could mean that Canadian’s email data, for example, wouldn’t have to be stored in Canada; leading some to worry about potential security threats and privacy issues.

Looking Ahead

Perhaps now that the full text of the agreement has been released concerns will be eased; as the secrecy of this agreement is perhaps its biggest criticism. Only once the agreement was finalized had the details been made public.

And it is important to remember that just because it appears as if the Canadian cloud won’t be a requirement to conduct business, it will still be an option your organization can consider implementing. With more commercial cloud services coming to Canada in 2016, there will be alternatives for organizations that must abide by to strict data storage compliance standards.