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Wednesday, 9 May 2012
Page: 4407


Mr NEUMANN (Blair) (10:09): I speak in support of the Customs Tariff (Anti-Dumping) Amendment Bill (No. 1) 2012 and the Customs Amendment (Anti-dumping Improvements) Bill (No. 2) 2012. On 20 April 2012, Capral CEO Phil Jobe met with the federal Minister for Home Affairs, Jason Clare, and me. Bundamba aluminium business Capral is quoted in the Queensland Times calling on us to bring forward this legislation. Mr Jobe said:

Chinese manufacturers are currently exploiting and circumventing existing legislation … The anti-dumping laws haven't been updated in over a decade, so it's good to see that under this government they are being brought up to date.

A key weakness in Australia's approach to dumping is the abject failure of the previous Howard coalition government and its unmitigated disaster in the recognition of China as a market economy as a precondition of FTA negotiations. That has restricted the ability of local authorities to apply subrogated or proxy pricing in cases where normal values cannot be easily assessed. China, for example, makes it very difficult in this regard. Customs has not been adequately funded or resourced in the past and is really fighting this issue—as are stakeholders like the AWU, Capral and other organisations—with one hand tied behind its back because of the complete and utter disaster of the Howard coalition government in the recognition of China as a market economy. This has resulted in a limited and partial application of relatively small dumping duties in some cases, compared to Canada and the United States, which adopt a very different approach to that of Australia in this regard.

In this country we need a properly resourced and independent antidumping agency responding to dumping and to complaints of stakeholders like the AWU, Capral and others. The Australian Customs and Border Protection Service is the only agency responsible for antidumping and countervailing investigations in Australia. The Trade Measures Review Officer provides an independent administrative appeal mechanism in relation to these matters. This is probably amongst the most complicated laws you could possibly imagine. For example, Capral itself has been involved in litigation in this regard and has had to spend considerable money on the services of a very eminent QC on numerous occasions to give advice and to represent them in these types of matters.

Paul Howes, the national secretary of the AWU, has said the oversight by Customs historically in this regard has been manifestly inadequate. This is primarily the fault of a failure in the past to address and resource problems of jurisdiction within Customs. Paul Howes says there is insufficient legislative coverage and weak governance in the department. As I said, the United States and Canada have adopted a quasi-judicial approach to the application of this type of legislation in the assessment of any injury, material or otherwise, to domestic industry. We have not adopted that approach. It all comes back to the ground rules and the establishment by the Howard coalition government in relation to the FTA and recognition of China as a market based economy.

In the past, the trade measures branch of Customs has been a little akin to the Swansea licensing bureau in Yes Minister—a poor cousin to colleagues focusing on border protection activities. The consequences are dramatic. We have seen importation of Chinese aluminium extrusion products dramatically impact upon Australian industry. Capral at Bundamba in Ipswich has 300 workers but, sadly, the plant utilisation is about 60 per cent. It is the result of experiencing unfair competition from Chinese imports. There has been a loss of well over $250 million of revenue in this sector. There has been the elimination of production activities and, as I say, suboptimisation of utilisation of plant in Australian facilities—for example, at Capral at Bremer Park in Bundamba, Ipswich. The Chinese have further expanded downstream their fabrication products. Our antidumping decisions in the past have actually buoyed the Chinese exporters. As Phil Jobe said to me in numerous meetings, they cannot believe their luck. We have seen a rising Australian dollar, and this has threatened the Australian industry. The consequences are that Chinese extrusion companies are supplying primary aluminium at rates that are about 20 per cent lower than prevailing world rates. They are simply setting artificially the yuan rate, which a lot of commentators say is 20 to 30 per cent lower than it should be. In addition to that they are subsidising their industries dramatically, dumping lower-than-cost products into Australia. It is unfair for our workers, it is unfair for our employers and it is unfair for our industry. We have seen Chinese aluminium exporters aggressively capture well above 35 per cent of the Australian market in recent years. On a per capita basis, according to the evidence I have obtained, Chinese extrusion exports to Australia are more than five times higher than to any other country, and that is a direct result of failures in the past.

So we need to believe in fair trade as well as free trade. This is not about protectionism. This is about creating the opportunities for our very skilled workers and our very skilled operators, like those at Capral, to make sure we have a level playing field so that we can compete competitively. It is not about breaching our obligations under the WTO rules. It is about making sure that countries comply with those rules and that they do not unfairly dump products into our country in breach of those rules. We are rolling out some of the most effective improvements to Australia's antidumping regime in more than a decade to improve its effectiveness. At the same time, we are reaffirming our commitment to the world trading rules.

We believe in free trade in this country, but we believe that trade should be fair. We do not believe it is fair to Australian workers and Australian manufacturers that China—or any other country—exports its goods to Australia at prices below the price it charges in its home market or below cost. That materially injures Australian businesses and puts Australian jobs at risk. So we have announced a number of reforms, and the legislation before us today is the third tranche of those reforms. I am quite committed as a local federal member in my area to making sure we protect Australian jobs. By that I mean making it fair so that employees, whether union members or non-union members, of companies like G James Glass & Aluminium, Capral and others in the Ipswich area and the western corridor are given a fair shake with respect to the operation of businesses.

I am pleased that Minister Clare has met with Phil Jobe and stakeholders to make sure we can do everything we can in the legislation to protect Australian jobs and give Australian manufacturers a fair go. Specifically, the legislation before the House today gives the CEO of the Australian Customs and Border Protection Service—the minister—the power to act on the basis of all facts available in determining whether a countervailable subsidy has been received and the amount of the countervailing subsidy if adequate information has not been provided to Customs by the country of origin or the company being investigated. A lot of these companies are Chinese state-run companies. The legislation also removes the limitation to the exclusion of profit when considering a normal value of a good and removes the need for a separate review of antidumping measures and a continuation inquiry when they occur in close proximity to one another. That is one of the biggest problems in this area: there is inquiry after inquiry after inquiry—one after another—which comes at a cost to the stakeholders.

One of the great reforms we put in place earlier was to empower organisations like the AWU and Capral to have standing—locus standi, to use the legal expression—to take countervailing measures and to use litigation. In the past, they often did not have the standing they needed. So we are going to do a number of things. We are allowing the minister to use additional forms of interim dumping duty beyond the single duty that is currently provided for. The new forms of duty to be outlined in the regulations are ad valorem duty, a fixed amount of duty or a floor price mechanism. These are part of the announcements that we made in the middle of June 2010 when we described it as streamlining the antidumping system. There are a number of improvements. I think the increase of 45 per cent in Customs staff working on antidumping issues is welcome. I think that has been important in the past. They have not been funded properly with adequate resources. The 30-day time limit which we have imposed for ministerial decisions on antidumping cases is very important. In the past it took ages and ages for decisions to be made and this puts a limit so that the minister can actually make decisions in that regard.

There are a lot of things that we have done. There is stronger compliance. That is one of the things that these bills do. I met with Phil Jobe recently and we talked about the measures at the ports and the waterfront and how they get around our duties and customs. I know that Phil has met with the minister to talk about what we can do in a practical way, a non-legislative way to actually stop Chinese and other companies from getting around our border protection mechanisms.

I think it is important that industry and trade experts have the power, the resources, the expertise, the knowledge and the muscle legislatively and financially to be able to get behind and investigate these complaints. I think there needs to be greater flexibility. I practised as a lawyer for more than 20 years and I am telling you that, when I read the legislation here, I read the litigation, I read the decision making and I read the QC's advice, this is about one of the most complex areas of law. It really is extraordinarily complex. We need a more rigorous appeals process. We need to be supported by more resources and I am glad we are doing that. I am glad we are taking a more flexible approach in terms of the standing of people to do it.

We are making big efforts. There is a lot more to be done. We need fair trade as well as free trade. We need to make sure that workers in the western corridor and across my electorate of Oxley get a fair go in this regard. I am pleased that Minister Clare has come to the plant in Ipswich. He said that Capral's plight was indicative of the manufacturers across the country. In the Queensland Times of 20 April this year he said:

Australian manufacturers are under a lot of pressure. Some of that is due to the high Aussie dollar, and illegal dumping adds extra burdens and extra pressure to these businesses.

I know that, the workers know it, the government knows it and we are acting through this legislation.