ABSTRACT
This chapter focuses on the Investment Agreement between China and the Association of Southeast Association (ASEAN) and their implications for the Regional Comprehensive Economic Partnership (RCEP), which is so far under-explored. It analyzes the models of China’s free trade agreement (FTA) investment rules, and in particular the uniqueness of the Investment Agreement for understanding the RCEP from the Sino-ASEAN perspective. The Investment Agreement lends support to the argument that it shows some extra flexibility to China among its FTAs. The flexibility in Investment Agreement negotiations stems from and is highlighted in the China-ASEAN Framework Agreement. Concerning non-conforming measures, the Investment Agreement does not include the standstill or ratchet mechanism, and instead allows new non-conforming measures. Social clauses include environmental, transparency rules as well as provisions on taxation and prudential measures. China’s trade agreements do not have a consistent model for investment rules, and instead include divergent rules regarding fundamental issues.
