Trade (Safeguard Measures) Bill

Labour supports this bill, the Trade (Safeguard Measures) Bill, although it does raise the question of why we are still debating this bill 6 years after it was first introduced by Lianne Dalziel. If the measures in this bill are truly significant and important, one would have expected that the Government would facilitate the passage of this bill well before a 6-year intervening period has passed. That intervening period creates additional difficulties when we come to look at the commencement clause and what this bill is about.

The title suggests, quite accurately, that this is a bill that enables New Zealand to apply safeguard measures and provisional safeguard duties at the border. I am a free-trader. This measure actually is consistent with the World Trade Organization, but it is consistent with the measure that was passed by the organisation in 1994, at the end of the Uruguay round, which made safeguards permissible. What do we mean by “safeguards”? You put safeguards in place to provide temporary protection to a domestic industry from serious injury that is being caused by imports, and you put them in place to facilitate adjustment in a domestic industry to increased competition from imports from outside.

But I have some questions to ask of the Minister in the chair, the Minister of Commerce, about why we need these. When was the last time that we employed a safeguards measure, Minister? Has the Minister got that information? Yes, this bill is about safeguard measures, but when did we last apply them? Which industries might they still protect? As we have done away with most of our import protections, apart from residual tariffs, and have entered into a range of free-trade agreements where this will not apply, are these measures, 6 years after the bill was introduced, still relevant? If they are relevant, to which industries are they relevant? If they are relevant, when was the trade safeguard measure, as set out here, actually utilised?

There are some aspects about trade safeguard measures that are important. There are legitimate trade remedies that we have against certain imports that cause injury to New Zealand industries, but they are actually applied in other areas. The Dumping and Countervailing Duties Act 1988, for example, allows us to stop people dumping their goods in New Zealand where they are selling their goods in New Zealand for less than they would be selling them at home. That is a legitimate trade safeguard measure.

That same Act—an Act that is, interestingly, 20 years older than the trade safeguard measures legislation that this bill is amending—also means that you can put countervailing duties on where a Government is actually subsidising the product and, therefore, that product is competing unfairly against New Zealand producers. So there are limits to free trade, and that is why the trade safeguard measures that title is about are necessary, but I would like the Minister to address the particular point about the normal, run-of-the-mill protection against imports that are neither being dumped nor being subsidised. Is there still a need, 6 years after this bill was introduced, for those sorts of protections; if so, in what areas are they needed?

The commencement clause, clause 2, states that this bill comes into force on the day after it receives the Royal assent. My real question is this: what is the Government’s intention in terms of putting this bill to the Governor-General for the Royal assent, because if it has mucked around for 6 years to get the bill even to the Committee stage, is it really intending to put this before the Governor-General for him to sign? If this bill was really significant—

💬 Dr David Clark: Or her.

—would it not have moved much more quickly? Yes—or her, because there may be a new Governor-General by the time the Government takes it to Government House. It is a fair question. Why has there been this delay? Once we know the reasons for the delay, we might have some inkling as to whether the Government intends to put this bill to the Governor-General for the Royal assent or whether we are just going through the motions here in the Chamber.

Why was this bill delayed for 6 years? When clause 2 was put into the bill, nobody imagined it would take 6 years to get the bill through the House. So it is a fair question—why has there been a delay? Is it incompetence? Was it a lack of confidence in the previous Minister? Or is there some other reason that led the Government to delay the progressing of this piece of legislation? I would argue that the Government should move quickly to put this bill to the Governor-General for the Royal assent. I said at the start that I am supporting the bill. I cannot understand why the Government has delayed it for so long. Is it still relevant? Those are particular questions that the Minister should address.

The reason I support this bill is the reason why Labour introduced it into the House. I support it because it streamlines the process of responding to allegations that goods are being dumped or subsidised. If there is a genuine breach of fair and free trade, then, obviously, you want to deal with that as quickly as possible. The bill removes the temporary safeguard authorities. I think that is actually quite a good thing because I think that the Ministry of Business, Innovation and Employment can now deal with this directly. It does not need to go to a temporary safeguard authority. I do not know whether the temporary safeguard authorities are actually costing us any money, but if they are, that is another reason why the Government should move with all haste to seek the Royal assent to this bill.

I think the bill does something else that is important, and that is it creates a more realistic time frame for the investigation of the need for a trade safeguard. At the moment, it is something like 35 working days, and I think anybody who has worked in this area appreciates that what is proposed in the bill—a 75-working-day period, and on some occasions an 85-working-day period—can be justified.

I think the other reason why this bill should be put forward for the Royal assent is that it does clearly set out the criteria for ministerial decision-making. In an area like this where you are alleging that there has been dumping, or that there has been subsidisation of the product, or that the competition is unfair because of a sudden surge of imports, you do need to have clear criteria that the Minister acts to. Those criteria include that there is a serious injury to the industry; that the importing of the goods against which safeguards are being sought was an unseen development; that the safeguards are, in fact, appropriate in their extent, in their duration, and in their nature; and that the safeguards are in the public interest. It is also important that these safeguards are compatible with the other free-trade agreements that we are in the process of negotiating.

I do not know whether anybody can remember when the bill went before the Foreign Affairs, Defence and Trade Committee. It was many years ago. But the committee made some important changes, narrowing ministerial discretion—making it clear, but narrowing it—to increase certainty on the part of those who are appearing before the Ministry of Business, Innovation and Employment seeking a safeguard or opposing a safeguard. I think it is important that where a provisional safeguard is put in place but no final duty is levied, there be a refund of the duty paid, and the select committee made that adjustment. And I think the most obvious and most important thing is that countries may be exempted from provisional safeguards where the World Trade Organization and trade treaties require that.

But now that I have got the Minister’s attention again—he was distracted when I raised the questions with him before—in terms of the safeguards applying in instances other than where the product has been subsidised or the product is being dumped, when was the last time, Minister, that a trade safeguard was used? If we are going to pass this legislation, we need to know that there is still a need for it. When was the last time that the trade safeguard was used? And what industries today, given our low level of protection, does he think might need trade safeguards simply because imported goods are causing injury to that industry? Yes, if it is dumped, and, yes, if it is subsidised by a foreign Government, there is no problem with the safeguard being applied. But in those other instances where those factors do not exist, which industries does he think we might need to protect?

I think those are important considerations before the Committee in passing this legislation. We need to know that the 6 years that the Government has dawdled over this bill have not made at least some of the provisions in this bill redundant. Why did the delay take place over such a long period of time? Will the Government, when this bill receives its third reading, actually put it before the Governor-General for the Royal assent? Those are significant questions. I think the Minister should not just sit there silently. He should make an endeavour to answer those questions, which are genuine questions.

Debate interrupted.