Clare O'Neil (Hotham, Australian Labor Party) Share this | Hansard source

It is great to have the opportunity to speak on the Circumvention: closing the loopholesreport. Australia is, of course, a free trade nation. As a small country, trade is our lifeblood. Over the last 30 years in this country we have seen real average incomes double. Trade has been a critical part of driving that, but sometimes trade is not done fairly. The Standing Committee on Agriculture and Industry recently looked into one of the more difficult areas where we see a barrier to fair trade in Australia, and that is around the practice of dumping.

For those listening in the gallery, dumping is a process where we see foreign exporters selling goods into Australia at below the price of making them. It is often the result of foreign governments who, usually for their own reasons, in their own domestic economies, provide unfair subsidies to the producers who operate in those countries. These are subsidies that a free and fair trading nation like Australia would not provide.

Essentially what happens is that dumping allows foreign companies to come in and compete with Australian companies but not on a level playing field. Dumping is not illegal, but under the World Trade Organization rules Australia is allowed to impose duties when we see that a product is being dumped into our market. So it is through this mechanism that we are able to even up the playing field a little bit.

One of the things we learned in this inquiry was that the law that regulates action against dumping and how those duties are set needs to be in a continuous process of evolution. As fast as we can make laws against dumping, companies that are operating overseas find a way to get around them. I will give an example, to bring it to life a little bit. One of the things we heard a great deal about in this inquiry is something called the minor modifications problem. This is occurring quite significantly in the steel industry in Australia, which faces a lot of competition from goods that the Australian government has deemed as dumped in our country.

We have put dumping duties on the importation of some steel, but recently exporters have tried to circumvent those rules by putting small amounts of boron into their steel formula. They call this 'pixie dust' because the boron does nothing to the essential properties of the steel. It has been put in there by the producer simply to circumvent the dumping duties that the Australian government has imposed on those imports. We see this quite frequently in other areas too—a dumping duty is put in place on a particular product and then an exporter makes a minor modification to that product so it meets a different definition. Clearly this is completely unfair.

This is one of the issues we covered in this ever-evolving area of trade. What did we recommend in response to some of the issues we heard about? On the minor-modifications problem, we are very pleased to see the Department of Agriculture has picked up on that. They have put in place a new process. We are keenly watching to see whether that manages the problems we have raised. But we want to see constant and rigorous evaluations of the laws we have in place. It is for that reason that the standing committee has recommended that we get a six-monthly report from the Anti-Dumping Commission to explain a little bit about how things are going and update us on any actions they are taking to ensure constant vigilance in this space. We have also made some recommendations about making the system faster and easier to use for Australian companies.

The report we are tabling today is testament to the hard work that is often done in this parliament but that often does not get a lot of play from our friends in the fourth estate. We worked very collaboratively on this. The chair of the committee, Rowan Ramsey, did a fantastic job. It is a bipartisan report and an area of bipartisan concern. I am very proud of the work we have done. I want to say thank you to the wonderful committee staff who helped us with this. Anthony Overs, who drafted this report, is here in the House. Thank you, Anthony. I also want to acknowledge the support provided by Peggy Danaee. I thank the committee for their hard work. It has been a pleasure to participate in this inquiry.

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