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Thursday, 27 November 1997
Page: 11471


Mr TRUSS (Minister for Customs and Consumer Affairs)(12.40 p.m.) —I thank honourable members for their contributions to this anti-dumping legislation. I have noted the comments that members on both sides have made about the importance of anti-dumping measures and having an effective regime in Australia to ensure that Australian industry does not face unfair and improper competition from goods that are dumped or subsidised in their country of manufacture.

I have to say that I have, though, been a little disappointed with what seems to be a lack of understanding on the part of some members opposite as to what dumping actual ly is. The fact that something comes into this country that is cheaper than the Australian product does not mean that it is dumped. The fact that it comes here and may be of poorer quality than the Australian product does not mean that it is dumped. The fact that it might be providing competition to an Australian industry does not mean that it is dumped. For a product to be actually dumped in this nation in the context of anti-dumping legislation, it has to be sold in Australia at a lower price than it is sold domestically in its country of manufacture. That point is sometimes missed by some who make perhaps ill-informed comments on these issues.

The honourable member for Hotham (Mr Crean) was perhaps as much guilty of that as anyone. I am disappointed that the person who sometimes says he is the shadow minister for these matters would make statements that are inaccurate. My understanding is that the shadow minister for customs is the member for Cunningham (Mr Martin). Opposition policy may well be advantaged if the member for Hotham gave it all away and let the member for Cunningham get on with the job. I think we would end up with a much more rational policy that way. There certainly seems to have been a degree of shifting and changing as far as that is concerned.

The honourable member for Hotham made quite a deal of reference to the Monsanto glyphosate case. He suggested that the government had messed it all up and that, therefore, this legislation was to try to fix up the problem. That is an absolute load of nonsense. It is important at the beginning to understand why the decision was made in relation to the glyphosate case. I will read directly from the conclusions of report No. 159 from the Anti-Dumping Authority into glyphosate acid from the People's Republic of China. The Anti-Dumping Authority states:

The Authority has found that most exports of glyphosate acid from China to Australia have been undumped. Of the few shipments that have been dumped, the dumping margins were negligible.

The Authority is not satisfied that glyphosate acid produced in Australia meets the `local content' requirements of subsection 269T(2) of the Customs Act.

So the Anti-Dumping Authority, firstly, came to the conclusion that the glyphosate was not dumped and, secondly, that even if it was, because the manufacturer in Australia did not meet the 25 per cent test, there was just no capacity for the ADA to make a ruling in its favour, even if it had wanted to do so. So the existing legislation, the legislation put in place by the previous government, precluded a decision being made in Monsanto's favour. I want to make one other observation in relation to that decision. It is true of almost every anti-dumping case that when one industry receives an anti-dumping duty that generally means that the costs go up for other industries. The decision not to impose an anti-dumping duty on glyphosate acid coming in from China was hugely popular in the rural sector, because they were going to get access to lower priced chemical products.

While referring to the comments of other members, I will make a brief reference to some of the remarks by the member for Curtin (Mr Rocher), who spoke about how important it is that there not be any undue burden on industry in endeavouring to establish what the costs of production might be in a faraway country. Let me emphasise that the government certainly recognises the difficulties faced by local industry, especially small business and smaller industries, in gathering information to mount a successful case.

The legislation does not impose a burden on the local industry. All they need to submit is `such information that is reasonably available'. It is then a matter for Customs to do the detailed research that might be necessary to ascertain whether practices are occurring in the country of manufacture which should give rise to dumping duties.

I would like to make a couple of comments on the coated paper case that was of particular interest to the last speaker who contributed to this debate, the member for Lyons (Mr Adams), and also to the member for Braddon (Mr Miles), who has done an outstanding job in representing the interests of the people of northern Tasmania and their particular concerns on this issue.

This was a very difficult case because it involved claims against 14 countries. It seems that some members, even though they claim to be very close to the situation in Tasmania, had not caught up with the fact that last week a positive finding was made in relation to Austria, Belgium, Finland, France, Germany, Italy, Japan, the Republic of Korea, the Netherlands, Switzerland and Taiwan. The exports from the companies subject to a positive finding represent 90 per cent of imports of the goods since January 1997.

There has been a finding in that particular case, and the matter now goes to the Anti-Dumping Authority. I encourage anyone who has views on that matter to make sure that they are known to the Anti-Dumping Authority. At the completion of its review, the ADA will make recommendations to me as the minister, and I will then decide the issue. It is inappropriate for me to make too many comments about the details of that case until I have had the opportunity to consider the ADA report.

In relation to the legislation before the House, section 269TAC of the Customs Act provides for the assessment of the normal value of imported goods for the purposes of dumping investigations. Until the latter part of last year, this section was applied to goods exported from economies in transition, such as China, by reference to information obtained in a surrogate country.

This is the key point—and I hope that even the member for Hotham might be prepared to acknowledge this point. In November of last year, the Attorney-General's Department advised that section 269TAC(4) was severely limited in its application. Its stringent tests require that the government of the country of export has at least a substantial monopoly of all of the trade of the country, not just in terms of the trade in the goods under consideration, and must also substantially influence the domestic price of all goods in that country.

The advice went on to conclude that the section could have no further application to economies in transition, such as China. As this section can have no further application to economies which are considered to be in transition, the determination of the normal values of exports from such economies as a matter of law must be made in accordance with the remaining provisions of section 269TAC.

The existing legislation does not distinguish between market economies and those that are considered to be in transition. Normal values of goods exported from economies in transition must therefore be ascertained by the application of the same methods that are required for exports from countries such as the United States of America and Germany. There is presently no flexibility available to treat exports from economies which are in transition differently from exports from other countries.

Australian industry has expressed concern at the potential for dumped imports from economies in transition to adversely affect Australian manufacturers. The government and Australian industry recognise the need to restore flexibility in the investigation of dumping from economies in transition. That is the purpose of this legislation.

On 12 March 1997, the government announced its intention to introduce into parliament amendments to the Customs Act that provide for a case by case approach to be taken in investigations into the alleged dumping of products from economies in transition. The Customs Legislation (Anti-Dumping) Amendment Bill 1997 amends section 269TAC of the act, and was tabled before the parliament on 25 June 1997. The bill corrects the anomaly with the existing legislation by recognising that there is still a level of government control evident within economies considered to be in transition which might in some cases so influence the domestic price of the goods under consideration that it would be inappropriate to use that price to determine normal valuation. The legislation has been drafted to provide investigators with a sufficient degree of flexibility to allow them to determine the normal value of goods under investigation in the best available manner, given the circumstances of each case.

Specifically, it provides that in those circumstances where the government of the country controls or substantially controls the domestic selling price of the goods in question then the normal value of such goods may be determined, having regard to all relevant information. This information may include, but is not necessarily restricted to, information obtained in a surrogate country.

At the request of the government, following the tabling of the bill in June, officials convened a series of meetings in Melbourne, Sydney and Canberra to consult with Australian industry on the provisions of the bill. In view of allegations that somehow or other the government has been tardy on this matter, it is important to note the progress that has occurred. The legislation was introduced in June, after the government's announcement in March that it was to take action in this area. That is surely a reasonable time in which to draft the appropriate legislation. We then consulted extensively with industry and held seminars in various places around the country.

In addition, the Senate, of its own volition, chose to take the matter away for its own inquiry. The government has been criticised on a number of occasions for proceeding with debates before the results of Senate inquiries are known. We have allowed a proper process of consultation to occur and the bill has now been brought on for debate. Industry expressed concern that the bill referred only to government control over the domestic selling price of the goods in question, and so a little later in this debate I will be proposing a government amendment to deal with those kinds of industry concerns.

I am conscious of the importance of this legislation and of the keen interest of members in anti-dumping measures and the sorts of structures that should be in place to best deliver results and outcomes for Australian industry and the Australian community. As I said before, we are currently actively addressing those issues. This legislation goes a long way to introducing a fair and appropriate way to deal with countries in transition, and I commend it to the House.

Question resolved in the affirmative.

Bill read a second time.