The U.S. Department of Commerce announced Jan. 31 that the Indo-Pacific Economic Framework for Prosperity agreement relating to supply chain resilience will enter into force Feb. 24.

IPEF was launched in 2022 with the aim of strengthening U.S. ties to the region and creating “a stronger, fairer, more resilient economy for families, workers, and businesses.” Australia, Brunei, Fiji, India, Indonesia, Japan, Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam are the current participants, and each of them except India has pledged to take part in all the initiative’s four pillars: trade (which India opted out of), supply chains, clean economy, and fair economy.

The supply chain agreement provides for the creation of (1) an IPEF Supply Chain Council to oversee the development of sector-specific action plans designed to build resilience and competitiveness in critical sectors, including by helping companies identify and address supply chain vulnerabilities before they become significant bottlenecks, and (2) an IPEF Supply Chain Crisis Response Network that can serve as an emergency communications channel and help support the timely delivery of affected goods during an acute supply chain crisis. The agreement also provides for the establishment of an IPEF Labor Rights Advisory Board to help identify areas where labor rights concerns pose risks to the resilience and competitiveness of partners’ supply chains, create a mechanism to address facility-specific allegations of labor rights inconsistencies, and ensure the availability of a sufficient number of skilled workers in critical sectors and key goods.

The DOC notes that the focus in the coming months will be to establish the IPEF Supply Chain Council, the IPEF Supply Chain Crisis Response Network, and the IPEF Labor Rights Advisory Board, including by:

- identifying the representatives to the three supply chain bodies by March 25;

- selecting the chair of each of the supply chain bodies by April 24;

- each body adopting its terms of reference by June 23;

- identifying and notifying partners of each country’s list of critical sectors and key goods for cooperation under the agreement no later than 120 days after the date of the entry into force for each country; and

- developing the guidelines for the facility-specific reporting mechanism on labor rights inconsistencies in IPEF supply chains by Aug. 22.

Under the terms of this agreement, ratification, acceptance, or approval by at least five IPEF partners was required for the agreement to enter into force. To date, Fiji, India, Japan, Singapore, and the U.S. have deposited their respective instruments of ratification, triggering the Feb. 24 effective date.

For more information on IPEF, please contact Nicole Bivens Collinson at (202) 730-4956 or via email.

Copyright © 2024 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

ST&R: International Trade Law & Policy

Since 1977, we have set the standard for international trade lawyers and consultants, providing comprehensive and effective customs, import and export services to clients worldwide.

View Our Services 


Cookie Consent

We have updated our Privacy Policy relating to our use of cookies on our website and the sharing of information. By continuing to use our website or subscribe to our publications, you agree to the Privacy Policy and Terms & Conditions.