Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

The US, under President-elect Trump, has made a clear statement that they will reduce their company tax to 20 per cent. We cannot continue with an uncompetitive rate of corporate tax without it adversely affecting the prosperity of this nation. This is why everything we are doing on this side of the House is to maintain and sustain our nation's competitive advantage. On the other side, it is just your politics and all about not caring about the things that make us a prosperous nation.

Getting back to the exact provisions of the bill, I will give some examples of 'substantially transformed'. For example, if apples and spices are imported into Australia to make apple pies using other Australian ingredients, such as the pastry and the sugar, the finished product becomes an apple pie. That is fundamentally different from its imported ingredients—the apples and spices—in terms of its identity and its nature. Therefore they can be described as being substantially transformed. Likewise, when grapes are imported into Australia and converted into wine using Australian production methods, as the identity, nature and essential character of the raw grapes themselves are fundamentally different from the identity, nature and essential character of the wine, those goods can be defined as substantially transformed. Other examples that the bill gives are about what can be said: you could say 'made in', 'produced in' or 'manufactured in'.

An example that would be misleading or deceptive conduct is: Australian beef is exported to Thailand, where it is combined with local ingredients to make beef stock that is put into canned beef and exported back to Australia—if that product was labelled 'product of Australia', it would not meet the safe harbours defence, because it contains significant ingredients from one country that underwent major processing in another country. A further example is: wheat that was grown, harvested, hulled and cleaned in Western Australia then exported to Italy and re-imported in the form of prepackaged frozen lasagne—if it had 'product of Australia' or 'product of Italy', it would not comply with the safe harbours defence, because it contained significant ingredients from one country that underwent major processing in another country.

A further example is: bulk chocolate that was imported into Australia from the UK and then formed into smaller blocks of chocolate and packed for retail sale in Australia—if that product was labelled 'made in Australia', it would not comply with the safe harbours defence, because the chocolate was not substantially transformed here in Australia. Forming imported chocolate into smaller blocks and packaging them does not result in a product that is fundamentally different in terms of the nature, identity or essential character. The last substantial transformation of the chocolate occurred in the United Kingdom, where the processed cocoa, butter and sugar were combined with local ingredients to make a new product which is fundamentally different from the identity and nature of the chocolate.

Many of my good friends would argue that: 'This is an overreach. It is a little bit more red tape for business, and why should the government get involved in this?' One of the few areas where I believe the government has a rightful place to get involved, as we do in our consumer and competition law, is regarding misleading and deceptive comments. One of the things about the free market is that it operates more efficiently if the purchasing decisions are better informed. That is why we have provisions in our act that misleading or deceptive conduct in trade or commerce is against our law. Misleading and deceptive conduct can also be by omission.

We want to ensure that consumers, when they go to the supermarket, can look at a product and be sure that the representation that is made on that product is accurate because it allows greater competition between brands and products, we get a more efficient market outcome and, most of all, it protects our great nation's competitive advantage. We want to ensure that, where someone uses those words 'made in Australia', 'produced in Australia' or 'manufactured in Australia', which have a good reputation of consumers paying a higher price, that is protected. That is what this bill does, and that is why I commend it to the House.

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