Bill to modernise New Zealand’s trade rules passes third reading

Commerce and Consumer Affairs Minister Paul Goldsmith today welcomed the passage of the Trade (Safeguard Measures) Bill.

“This Bill updates New Zealand’s trade safeguards regime to ensure it is consistent with World Trade Organisation (WTO) rules and to promote efficient, transparent and objective investigative and decision making processes,” Mr Goldsmith says.

“At a time of increasing globalisation and competition from imported products, safeguards, usually applied in the form of a border duty, are an important emergency measure to have available.

Safeguard measures are temporary measures, normally applied to imports from all countries, which are designed to facilitate adjustment by a domestic industry if there has been a sudden surge of imports of a product which has caused or threatens to cause serious injury to a domestic industry.

The Bill also introduces guidelines for determining whether the imposition of a safeguard measure is in the public interest, in order to increase the certainty and transparency around the process.

Most significantly, the Bill allows provisional safeguards to be introduced by the Minister of Commerce and Consumer Affairs. This measure enables prompt action by government, but allows any safeguard duties to be refunded if the investigation finds the measures were not required.

Other changes include:

• Extending the previous 30 working day timeframe for the completion of a safeguard investigation to 75 working days (or 85 days if provisional safeguard duties are requested).
• Safeguard investigations will be undertaken by the Ministry of Business, Innovation and Employment to make use of its existing trade rules expertise and resources, rather than by independent Temporary Safeguard Authorities which, because of the low number of cases, can be difficult to have immediately available when needed.

The Bill was introduced in 2008, following a review of New Zealand’s existing safeguards regime. A law change was necessary to bring the regime into line with WTO jurisprudence, improve the efficiency of the process for carrying out investigations and imposing remedies, and to clarify some ambiguities in the existing legislation.

“This Bill introduces a robust regime that is in line with international rules. It allowssafeguards to be introduced quickly and transparently,” Mr Goldsmith says.

Editor's notes:

The Trade (Safeguard Measures) Bill was introduced to the House in September 2008. The Bill replaces and repeals the Temporary Safeguard Authorities Act 1987. It takes effect from the day after it receives Royal assent.

To date, four safeguard investigations have been carried out since 1987, most recently in 1995. Of the four investigations, one resulted in the imposition of a temporary safeguard measure.