• Virtually free trade in goods and services, including a “mutual recognition” system whereby compliance with regulatory requirements in one jurisdiction (such as qualifications to practice law or requirements when offering securities) basically means exemption from compliance with regulations in the other jurisdiction. And for sensitive areas, such as food safety, there is a trans-national regulator.
• Virtually free movement of capital, underpinned by private sector and governmental initiatives.
• Free movement of people, with permanent residence available to nationals from the other jurisdiction – not tied to securing employment.
• Treaties for regulatory cooperation, simple enforcement of judgments (a court ruling in one jurisdiction being treated virtually identically to a ruling of a local court), and to avoid double taxation (including a system for taxpayer-initiated arbitration among the member states).
• Government commitment to harmonising business law more widely, for example for consumer and competition law.

No, I am not referring just to the EU! These aspects characterise the Trans-Tasman framework built up between Australia and New Zealand, particularly over the last two decades. Sometimes this has been achieved through treaties (binding in international law), sometimes in softer ways (such as parallel legislation in each country), and sometimes even through unilateral abrogation of national sovereignty. Both countries are also now actively pursuing bilateral and now some regional Free Trade Agreements (FTAs), especially in the Asia-Pacific. So can these Trans-Tasman initiatives, and perhaps even some (not all) EU developments, provide a template for true “Asia Pacific Community” or an “East Asian Community”?

More generally, the Global Financial Crisis is generating a reorientation of burgeoning Asia-Pacific production chains towards exports within the region, in conjunction with a reassessment of market liberalisation policies themselves. In light also of the limited economic benefits of bilateral and even regional Free Trade Agreements, compared to multilateral initiatives, we should be looking for ways to promote additional “free but fair” movement of capital, people, services and goods throughout our region. Collaboration in regulating consumer product safety, financial markets, environmental protection, labour standards and investment regimes are only some of many possibilities explored in this paper. A more holistic, systematic and balanced approach to negotiating true Economic Partnership Agreements (EPAs) would assist not only Australia and New Zealand, but also partner countries that are already erecting new socio-economic regional architecture.

See further: Nottage, Luke R., Asia-Pacific Regional Architecture and Consumer Product Safety Regulation for a Post-FTA Era (November, 19 2009). Sydney Law School Research Paper No. 09/125. Available at SSRN: http://ssrn.com/abstract=1509810

From the outset the EU model implies a model of institutionalization combining a search for order mainly through legal mechanisms. Policy instruments are also used to overcome the disparities between or among member states. In contradistinction, ASEAN commenced on the basis of both national and regional uncertainties. ASEAN regional cooperation, therefore, has preferred informal and non-legalistic procedures rather than rigid institutional mechanisms like those of the EU.

When looking at the interaction between member states and the organization, it clearly appears from the outset that the EU, while delegating national sovereignty in some areas to the supranational level, disposes of deeper and more powerful mechanisms of solidarity and cooperation than ASEAN. On the contrary, even if the EU, like ASEAN, attempts to promote mutual respect and consensus-building among member states, it does so in a less overt fashion than ASEAN. Moreover, ASEAN emphasizes non-interference in the internal affairs of member states as well.

However, it is obvious that, in the case of the EU, the delegating of national sovereignty to supranational authority could bring more effective policy decision-making at the regional level than retaining sovereignty at the national level, as in the case of ASEAN. The supranational approach also fastens on the process of regional cooperation to achieve certain goals of organization other than those preferred in the intergovernmental approach. Undoubtedly, when member states prefer the supranational approach, national sovereignty is inevitably transferred to the regional level as a result.

Thanawat Pimoljinda