Most Read Contributor in Australia, September 2016
On 21 June 2012 the Australian Government asked the Productivity
Commission to investigate whether safeguard action is needed to be
implemented to protect Australia's processed fruit and
processed tomatoes industry.
SPC Ardmona sparked the investigation after it reported that a
significant increase in imported products has swamped supermarket
shelves and created an uneven playing field resulting in the
termination of contracts with 60 growers in the Goulburn Valley
The Productivity Commission has been tasked with reporting
whether conditions are such that safeguard measures would be
justified under the World Trade Organisation Agreement
if so, what measures would be necessary to prevent or remedy
serious injury and to facilitate adjustment
whether, having regard to the Government's requirements for
assessing the impact of regulation which affects business, those
measures should be implemented.
Safeguard measures include temporary, 'emergency action'
(using tariffs, tariff-quotas or quotas) implemented in situations
where a surge of imports causes or threatens to cause serious
injury to a domestic industry (Commonwealth of Australia Special
Gazette No. section 297, 1998).
Under World Trade Organisation (WTO) rules, a
government can only take safeguard action (whether final or
provisional) if its 'competent authority' finds that action
is justified. Although the government can choose not to act, if it
does take action it cannot impose measures greater than those
considered appropriate by the authority (in this case, the
On 26 September 2013 the Productivity Commission released two
accelerated reports 'Safeguards Inquiry into the Import of
Processed Food Products' and 'Safeguards Inquiry into the
Import of Processed Tomato Products' which concluded that the
strict criteria stipulated by the WTO have not been met and
provisional safeguard measures are unwarranted.
In it's submissions to the Productivity Commission the
Australian Manufacturing Workers Union stated:
"Australia wants to be the
"food bowl of Asia" but this can only happen if the
government is prepared to support local food companies in the face
of unforeseen competitive pressures. Without government
intervention to support our local industry, we are not going to be
able to feed ourselves, never mind Asia. Cheap imports are
threatening to eradicate our local processed tomato and fruit
industry. The WTO's emergency safeguards are a simple, common
sense measure to eliminate the immediate pressure on the industry
while the situation is reviewed. The time for action is long
The Productivity Commission's investigations are ongoing. A
final report into whether WTO safeguards are required to protect
Australian's canned fruit and tomatoes industry is expected to
be finalised by 20 December 2013. We will provide an update once
the final report has been released.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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