Mark Dreyfus (Isaacs, Australian Labor Party, Shadow Attorney General) Share this | Link to this | Hansard source

The Commerce (Trade Descriptions) Amendment Bill 2018 amends the Commerce (Trade Descriptions) Amendment Act 1905. The amendment means that the exceptions under section 255 of schedule 2 to the Competition and Consumer Act 2010 will now apply to offences in the Commerce (Trade Descriptions) Act 1905. The result of this extended application of the exceptions will be that an effective defence exists to a prosecution under the Commerce (Trade Descriptions) Act in a range of circumstances where the goods have substantially come from or have been made or manufactured in the country of origin which they purported to come from. This is an uncontroversial reform which essentially harmonises the laws relating to consumer protection and trade descriptions.

There is an important principle which is supported by this reform. The bill has at its core the purpose of ensuring that businesses and people who sell goods which originated overseas provide consumers with the information they want and need in order to make informed purchasing decisions. A consumer has a right to know a range of matters which will allow them to make an informed choice about whether or not to purchase particular goods. A consumer has a right to know where their goods come from; a consumer has a right to know where the produce that was used to make the goods come from; a consumer has a right to know where the produce was grown; and a consumer has a right to know whether or not a substantial amount of the work that was undertaken to make the goods actually took place in the country where the goods are described as having come from. It is this information which is fundamental to a consumer, who should not be misled into spending money on something that is not the genuine article or for which they cannot obtain sufficient information to be assured that the provenance of the goods is what it is said to be.

Importantly, providing a consumer with accurate and correct information not only assists informed choice but also supports business longevity and prosperity. It's obvious that a part of getting a consumer to trust the business practices of the people and companies that they buy goods from is the availability by the business of an honest and good-faith disclosure of the country of origin for the goods the consumer is purchasing. If this good faith exists, it's likely that the consumer will trust the business or person, not only for the first transaction but for subsequent transactions. This is as important for business as it is for the consumer. If a business goes about the sale of goods in good faith, always seeking to let the consumer know what they're buying, then the business will gain a good reputation over time, becoming a trusted source for the trade they are conducting and potentially expanding the number of consumers who come to them knowing that they are buying the genuine article. It is in this light that Labor views business disclosure. It's the necessary respect cementing the relationship between businesses and consumers, who need to be informed of the provenance of the goods they're buying.

However, Labor accepts the need to balance the extent of the disclosure against the information that is reasonably available for businesses. An Australian business may not be able to certify to their satisfaction that all parts of a product or all the processes needed to manufacture the goods were undertaken in the represented country of origin. Given this reality, it's necessary to protect Australian businesses from unwittingly committing offences under the Commerce (Trade Descriptions) Act 1905 where there is no attempt to mislead or to otherwise falsify the information being provided to an Australian consumer. Under the Commerce (Trade Descriptions) Act 1905 and the associated regulations, a trade description is required to be applied to goods proposed to be imported into Australia. A trade description is also required to be placed on imported goods found in Australia.

Section 255 of the Australian Consumer Law is a safe-harbour provision. Its inclusion in the Australian Consumer Law was supported by Labor when the government enacted the Competition and Consumer Amendment. (Country of Origin) Act 2017. The effect of section 255 is that a person will not have committed an offence of false and misleading conduct if the facts of their conduct fall within one of the exceptions. This bill extends the exceptions so that they apply to offences in the Commerce (Trade Descriptions) Act 1905. As a consequence of this bill, a person can rely on an exception in section 255 of schedule 2 of the Australian Consumer Law as a defence to a prosecution of an offence contained in the Commerce (Trade Descriptions) Act 1905.

The circumstances in which these exceptions can be applied are as follows. First, where a business or person has made a representation that goods were grown in a particular country, it is a requirement, if the business is to rely on the exception, that each significant ingredient or significant component of the goods was grown in that country; further, that all or virtually all processes involved in the production or manufacture of the goods happened in that country. Second, where there's been a representation by the business or person that goods are the produce of a particular country, the bill requires, sensibly, that the country was actually the country of origin for each significant ingredient or a significant component of the goods. Similarly, the bill requires that virtually all processes involved in the production or manufacture of the goods happened in that country. Third, the bill applies to representations that the goods were made or manufactured in a particular country and that the goods were substantially transformed in that country. These are appropriate exceptions that balance the need to provide consumers with sufficient information with the need to ensure that businesses do not unwittingly commit criminal offences which have long been on the statute books.

On a related note, I suggest to the House that measures which protect consumers will only work where consumers have enough disposable income to buy properly marked goods. Under the Turnbull government, we've seen more insecure work and cuts to penalty rates, and the government commit, time and time again, to a tax cut for the top end of town. As my colleague the shadow Treasurer has said before, the Labor Party supports tax cuts coming into force on 1 July 2018. Indeed, we'd go further and have tax cuts almost twice as big in 2019. These would give Australian consumers more money to spend on the essentials they need.

If the government decided to proceed with Labor's tax cuts rather than their handout to big business, then small businesses who sell the goods that are the subject of this bill would receive the benefits. If the government wants to see these tax cuts implemented and wants to make a difference for working Australians, then they should split the bill implementing their tax cut scheme before the Senate. They should split that bill and allow the parliament to vote separately on the tranches of proposed tax cuts: the 2018 tax cuts, which will sail through the parliament, and the 2022 and 2024 measures.

Labour's concerns about the proposed 2024 tax cuts are well known. The Treasurer has refused to release the data relating to the year-on-year costs of the government's tax cut scheme. Labor has had to seek that information from the Parliamentary Budget Office. It shows that the 2024 proposed tax cuts grow exponentially over time and have a very, very significant cost to the budget bottom line. The Treasurer cannot tell you what the economy will be like in 2024, yet somehow he thinks he can say that the economy can afford these tax cuts. Not only is the Turnbull government unwilling to give a tax cut to those people who really need it but they are willing to lay waste to budget repair and their economic credentials in the process. They're willing to hope that in 2024, with a widening gap between the wealthiest and the poorest in this country, the economy will perform well enough under their new regressive tax plan to mean that those small- and medium-sized businesses selling goods from around the world will be able to stay trading. Labor does not believe in a regressive tax plan. Labor believes in giving relief to people doing it tough and to small- and medium-sized businesses doing it tough.

Australians rely on a compact between business and consumers, but in order for that compact to work consumers need to have enough money to spend on goods, and businesses need to be honest and act in good faith when trading. It is in light of this compact that I note this bill does nothing to shield businesses or people who are engaging in false or misleading conduct with respect to the country of origin of the goods they are making available to the public. Labor will always stand with consumers and will always ensure that those businesses and people who wilfully seek to fraudulently or falsely mislead Australian consumers are prosecuted. This is in keeping with the fact that under Labor governments the economy prospers because we set rules that are fair, enforce rules that are broken and ensure ordinary Australians have enough to get the goods they need and help local small- and medium-sized businesses flourish.

I also note that this bill ensures coherence and harmonisation across the statute book. This is a laudable objective for our laws, and Labor supports the government's effort to ensure that there are no unintended inconsistencies in the laws governing consumer protection and trade descriptions.

Finally, on a point of indulgence, I'd like to mention that the work of the opposition on this bill was done by the former member for Perth, Mr Tim Hammond. All of us in this place were saddened by the resignation of the former member for Perth. I personally thank him for the work he did on this bill and for all the excellent work he did as a member of this House. I commend the bill to the House.

Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

It's a great pleasure to stand up and speak on this important piece of legislation, the Commerce (Trade Descriptions) Amendment Bill 2018. Before I was elected—in fact, if I go all the way back to my old university days—I have always had a passion and an interest in opening up markets and advancing the cause of free and open trade. The reason is straightforward: we know that free markets and free trade are the pathway to prosperity for every society in the past, and so it forever will be in the future. No society has ever taxed itself into prosperity or aided itself into prosperity, but it has traded itself into prosperity.

Even this piece of legislation, which may not seem like the compelling, overarching framework of all things we need to do to advance the cause of free and open markets across the world, is nonetheless yet another brick in the bridge we are trying to build to try to increase the amount of free-flowing goods and services between our great nation and those who seek to engage with us. Free-flowing goods and services have been and always will be responsible for the wealth of this country. We have always been a nation that cannot consume everything that it produces. If we want to see an advancement in our material prosperity and the material prosperity of so many other countries we engage with, we need more traffic on our international trade highways, not less.

To make sure that we have that advancement of free and open markets and trade, we need rules and standards which are universally understood and which minimise the behind-the-border obligations and regulations which can undermine the capacity for business to get on with it, for enterprises to get on with it and for entrepreneurs seeking to build standards, products, goods and services that they can trade across the global marketplace to get on with it. The lesser the regulation, always the better. The more consistency and harmonisation between standards, the better, because it removes an obstacle and a barrier. If there's one truth, it's that, if you have more complex regulation, like more complex tax, all it does is favour established interests, as people seek to use and manipulate those regulations or taxations in their interest, and burden those people who are merely starting out, trying to get their fair share and their fair go. That's why this piece of legislation is important; it seeks to achieve that harmonisation and remove unnecessary barriers that sit at the heart of our economy for those people who want to export.

We need more competition for goods and services domestically, but, more critically, we need more competition for goods and services globally, not higher restrictions on our importers and our exporters. We need to rebuild, frankly, Australia's free trade consensus. I'm sure many people in this chamber have watched as that free trade consensus that was built after the collapse of the Berlin Wall and the end of the Cold War has become tested and challenged by countries that now seek to impose tariffs and regulations on other nations for exporting basic goods and value-added goods like steel. And that risks a global trade war, because we know that, when you see countries resort to protectionist measures, whether it's by simple tariffs, quotas or regulations, countries will eventually respond in kind, and every person on this planet will end up paying more for less. They will have a reduced standard of living. They will see costs and obligations shifted upon them by those political masters who only seek to buy votes in advancement of the interests of their constituencies but at the expense of living standards and always at the greatest expense of the poor. Anything we can do to undermine that cause and that crusade by those people who seek to use trade to their political advantage is worthy and just.

That returns us to this bill and its potential and objectives. Even at a basic administrative level, it is one of the bricks for building the bridge of an international free trade highway. We need to rebuild consensus for that free trade highway. If we do, the principal beneficiary will be the Australian consumer, and that includes real people living across this great continent who seek merely to achieve the highest standard of living that's available to them. It's the family of four who are always looking for good deals in supermarkets and shopping centres and don't want to pay overly inflated prices, carrying the cost of tax, regulation, tariffs and other measures. It's those people who are vulnerable and just trying to get ahead. It's the student who's starting out and having their first kick at life, living away from home and trying to live a happy, healthy lifestyle on a tight household budget. They are the victims of protectionism. Just like single-income families who are feeling the cost-of-living pressures firm on their shoulders as they manage the great costs in their life, not just managing housing stress, whether it's rental or mortgage stress, but the costs of energy and electricity. And, let's face it, our political opponents are doing little to help us try and reduce those prices, but let's get past that. There's also the burden and cost of education and the burden and cost of making sure people can afford basic staples and supplies to feed and clothe their family.

When you increase regulations and barriers, they are the costs that go up—those that are most sensitive, those things that are produced by people in other parts of the world where Australia does not have a comparative advantage, where we are not competitive and rely on the ingenuity and the capacity of other nations. But, let's face it, even if we increase those costs and they don't go directly to the household, in the end they become costs that burden businesses in Australia that seek to be competitive in a global marketplace. At every step, at every stage, they suffer the consequences, whether it's the family of four, the student, the single-income family or the pensioner.

No matter who has a tight budget, protectionism only rewards one group of people: the established interests and those who are rich and powerful. That is why, as a Liberal, I will always defend a freer, more open market economy and freer and more open trade. It is people who are seeking a sense of opportunity in society that we must always stand up for. The more we empower those people to export and import across boundaries and barriers, the more we empower those people to live better lives. And the more we empower importers to change the status quo, the more we drive competition. Too many people in trade policy are only interested in focusing on exports, because they think that is the only way to achieve prosperity, without recognising the important power that drives competition in domestic economies. Australia is a great emblem across the world for delivering. We cannot produce everything ourselves but what we do produce we do well and we sell in the global marketplace with a premium. But when we import things it value-adds and contributes to the development of our domestic industry to be competitive across the world.

We want to see cheaper prices for goods, as well as protecting consumers against misleading information about where something is made. It is about clarity and transparency so people can make those informed decisions. This bill forms part of the government's broader reform of country-of-origin labelling. Labelling information gives consumers protection against misleading and deceptive conduct. Regulation governing these rules should be the same for imported and domestic goods. It is about harmonisation, it is about informing consumers and it is about making sure that behind-the-border measures aren't acting as a sneaky or tricky way to not only confuse consumers but also add costs onto the Australian consumer.

Therefore it makes sense to ensure that there is consistency between the Competition and Consumer Act and the Commerce (Trade Descriptions) Act. The bill would have the effect of providing a defence for importers who get caught up in the importation of goods with a false description. The alignment between the two acts will reduce the complexity of enforcing origin marking requirements at the border, allowing Australian Border Force to focus compliance activities on goods that don't meet the safe harbour defences. In short, this bill gives our importers the freedom to make a claim about the origin of their goods similar to those permitted under the Australian consumer law.

This bill isn't just a brick in the bridge to advance a free trade international superhighway. It is a bill that seeks to reinforce Australia's existing commitment to free and open markets and trade and say to the average Australian that they should pay no more than necessary for those basic consumer goods that they enjoy, particularly those that are most sensitive to prices and which most dramatically are consumed by average Australian households, the vulnerable and those on fixed incomes, and that is food. And that's the basis on which I support this bill.

Angus Taylor (Hume, Liberal Party, Minister for Law Enforcement and Cybersecurity) Share this | Link to this | Hansard source

I would like to thank members for their contribution to the debate on the Commerce (Trade Descriptions) Amendment Bill 2018. As we just heard, this bill is another example of our government's strong commitment to open trade, to the value of trade and to the impact that trade has had on this wonderful country. Over the last several hundred years it has been central to our success as a nation. This bill is one of many initiatives the government is pursuing, alongside the free trade agreements, to ensure that we remain a successful trading nation with a minimum of red tape, a minimum of intervention from government, in achieving that great goal of more trade, higher standards of living, greater investment and more jobs—all those things that come with an open trading economy.

The bill enables officers of Australian Border Force to take into account the safe harbour defences set out in the Australian Consumer Law when assessing country-of-origin claims on imported goods. The bill also provides a head of power to enable the Commerce (Trade Descriptions) Regulation 2016 to be amended to incorporate information standards made or declared under the Australian consumer law that are in force or existing from time to time. The amendments in this bill will ensure that businesses are provided with certainty that their country-of-origin claims are compliant with labelling requirements. The bill also establishes prohibitions against misleading country-of-origin representations whether they are importing the goods or selling them in Australia. I commend the bill to the House.

Bill read a second time.