House of Representatives

Second Reading Speech

Mr BRENDAN O'CONNOR (Minister for Home Affairs, Minister for Justice and Minister for Privacy and Freedom of Information)

I am pleased to introduce the Customs Amendment (Anti-dumping Measures) Bill 2011, which will amend certain provisions of the Customs Act 1901 concerning reviews of antidumping measures. In brief, the amendments will clarify the circumstances in which the minister may revoke antidumping measures as a consequence of such a review.

The bill responds to a decision from last year of the Full Federal Court in the Minister of State for Home Affairs and Siam Polyethylene (the Siam decision, as it is called), which considered the review provisions and, in particular, the test for determining whether antidumping measures should be revoked.

The government believes the decision will lead to outcomes inconsistent with the objects of Australia's antidumping system, and it is appropriate that we seek to rectify it.

The Siam decision is problematic for two reasons.

First, the case highlighted a lack of clarity in the current review process, whereby affected parties must request one of three things: (a) a complete revocation of existing antidumping measures, (b) an adjustment to existing measures, or (c) both a revocation or, failing that, an adjustment based on changed circumstances.

Second, the court in its decision formulated a new test for determining whether antidumping measures ought to be revoked. The formulation will likely lead to measures being revoked where they remain warranted.

In relation to the first problem, it was established practice for Customs and Border Protection, prior to the Siam decision, to conduct reviews consistent with the nature of the review request. If there was no request for measures to be revoked, Customs would not consider whether measures ought to be revoked.

The Siam decision changed this by leaving open the question whether revocation must be considered in every case. It has led to a situation in which revocation is considered even in cases where an applicant has not specified that revocation is sought.

In the case of Siam, that was a matter in which a request for revocation was made but was received late in the process of a review into whether measures ought to be adjusted. There was nothing explicit to prevent the revocation request being made at that point in time, but the lateness of the request constrained Customs in its ability to undertake a worthy examination of the relevant issues.

As a result of the Siam decision, where an affected party lodges a request for revocation, the minister is obliged to properly consider that request, no matter when in the review process the request for revocation is received.

The intention of these amendments is to make the process of applying for a revocation review clear to all affected parties.

The amendments clarify that if affected parties want the minister to revoke measures, they must apply for it, and they must do so at the outset of a review process or within 40 days of a review commencing.

The amendments cement Customs' existing practice to treat revocation reviews as different in kind from reviews adjusting or updating the level of the measures, and will require an affected party to provide evidence that there are reasonable grounds for asserting that measures are no longer warranted.

The amendment will also improve procedural fairness, by giving affected parties advance knowledge of the process for seeking the revocation of measures, and will ensure that investigators have time to consider the issues before reporting to the minister. Importantly the amendments will give interested parties adequate time to defend their interests.

The second problem raised by the Siam decision was the Full Federal Court's construction of the revocation test.

In the absence of a legislative test, the court determined that the minister must revoke antidumping measures, unless satisfied that there would be dumping causing material injury to the Australian industry if measures were not in place.

The formulation is problematic because, where dumping measures are in place, it will be difficult to establish dumping causing material injury. In fact, if dumping measures are effective then, at least in theory, there should be no injurious dumping.

As a result of the Siam decision, it is now much more likely that a finding of no dumping or no injury during a review period will lead to revocation.

For these reasons it is appropriate to amend the review provisions to clarify the circumstances under which dumping measures should be revoked.

The proposed amendments insert a new test which will provide that the Customs CEO must recommend that the minister revoke measures unless satisfied that the removal of the measures would lead, or be likely to lead, to a continuation of, or recurrence of, the dumping or subsidisation and the material injury that the antidumping measures are intended to prevent.

It is a clearer test, which will avert the unnecessary revocation of effective antidumping measures.

The government is committed to its antidumping system. These amendments will ensure that, where measures have been put in place to address injury faced by Australian industry as a result of unfair trading practices, those measures remain effective.