Louise McGrath

Welcome back to DBrief, the podcast where we explain policy to industry and industry to policymakers. I'm Louise McGrath, Head of Industry Development and Policy at the Australian Industry Group, and today I'm speaking with Dave Latina, Commissioner of the Australian Trade Remedies Commission.

David, you had a long career in supporting SMEs and exporters before taking on this role in January 25. What surprised you most about this job?

David Latina

I think the incredible passion that that industry has for supporting a fair and competitive environment for businesses. I think the that you've got some terrific businesses out there that are doing their best, competing internationally and all they're all they're seeking is a good level playing field for businesses and that they don't they're not after free kicks or anything. All they're after is a fair competitive environment for them to play in. And it's a really tough it's a really tough market, tough market in domestically, but also internationally as well. And so it's great to see that you've got some terrific businesses, terrific Australian businesses, but also those that import products as well, that are doing their best in a really challenging international environment. That's always really inspiring as someone like myself who's seen a lot of industry but really great to always come across those businesses.

Louise McGrath

Yeah, I think any Australian manufacturer surviving today would have to be the leanest, most competitive business, you know, li in the certainly in Australia and and probably globally as well.

David Latina

Almost by definition you've got to be like world's best practice, really, otherwise you just won't survive.

Louise McGrath

Yeah, yeah, exactly. Now dumping sounds like something that happens at the tip, but and it's sort of a niche area of trade policy, but in plain English, what is it? And how do you answer that skeptic who says trade remedies are just protectionism with better manners?

David Latina

Yes, I think when I when I told my kids that I was I had a new job as working in the dumping space, I'm not sure that they understood what I was getting myself into. But essentially dumping is when an overseas exporter sells goods in Australia at at a lower price than what they would normally charge consumers in their home market, or that they're selling it for a cost that's less than what they what it costs them to produce. And so that often that's because of particular tactics that unfair tactics that those those international businesses are doing in terms of exporting their products internationally, or it's because their governments often they can afford to do that because often their governments are actually providing subsidies for them. And that means that then they can sell it for below cost overseas as well.

And from our perspective, that's really an unfair practice. it's an unfair international trade practice. It really undermines a fair and competitive market environment and it really undermines a level playing field for Australian industry and those and those industries that are that are playing by the rules internationally as well. And in terms of when people say, Well, that's very protectionist, of governments to enact trade remedies measures. I'd say is that these are rules that have been established by the World Trade Organization internationally. Most countries have got trade measure trade remedies measures in place and systems in place because I think that they realise that it's important that people believe in in competition, but it needs to be fair competition so that we're all playing by the rules.

And I think the other aspect of it is that you know Australia's a great trading nation. It's a great it's it believes in open trade. It's entered into a lot of free trade agreements with countries. And in order to as part of that arrangement, there was always it was always considered that that if businesses are playing by the rules, then they should have open competition. But it's also in sure that if people aren't playing by the rules, that there's consequences of that.

David Latina

And that's where trade remedies comes into play here. And it's plays that role of where businesses are imposing unfair trade practices out in the market, that in fact that industry, local industry that's being injured by those activities have actually got somewhere to go for those situations to be investigated.

Louise McGrath

And I think there are some trade purists who would prefer to see, you know, no anti-dumping rules. But I think if you believe in a rules based global trading system, you have to accept all the rules, even the ones you don't particularly like. But it's also important, I think, just for that social license for trade, because we've seen various movements around the world, Brexit, you know, some of sort of Trump economics, et cetera, very anti trade. And that's because they're actually experiencing this sort of lack of fair play and fair competition.

David Latina

Absolutely, that's right. And I think the other aspect of it is is that we also need to be mindful of playing and l observing the log game in terms of competition. So a business that that some consumers might think, well, this is terrific because we're getting a really low cost price from dumped products, isn't this terrific? But if that undermines local industry and it means that that injures local industry.

And it means that they no longer are viable to exist anymore and there's no there's no local industry as a competitive player out there in the market, then not only does it undermine our resilience, economic resilience as a country, but it also undermines a competitive marketplace. And so we know that in those sort of circumstances, of course, in the longer term, prices are gonna go up. So it's not in the long term interests of a fair and competitive marketplace.

Louise McGrath

And it should probably be said it really only applies to manufactured goods as well, because, you know, Uber and others sort of you could argue dumped their services onto the market and, you know, disrupted a whole taxi industry. yeah, so it is very much only in manufacturing.

David Latina

Only for manufactured goods and obviously goods where we continue to manufacture it. So I'd say some people ask me sometimes, what are we doing about cheap electric vehicles being imported into Australia? And I'd say, Jeez, I w I wish we still had a you know, an end to end automotive industry in Australia. but unfortunately we don't and therefore that's not something action that I can that that we can take in relation to that. so

Yeah, there's a there's a there's a it's a really high threshold also for measures to be taken in response to dumped products. So it's gotta be you've gotta be a l you've gotta have a local manufacturer making the product the products need to be found to be dumping and that's quite a a detailed process to go through. It's gotta be injuring the local industry, those that that dump product is injuring the local industry. And there needs to be causation that in fact that the dumping is causing the injury to local industry. So it's quite a high threshold. So it's not an easy case to be made. But where those that evidence can be found and where applications come to us, then we can undertake those investigations to see whether it meets that. So it's not something that's be considered lightly.

Louise McGrath

Now there's a few changes happening at the moment and on the twenty-ninth of September the Anti-Dumping Commission actually became the Australian Trade Remedies Commission. So beyond the new name, what changes for a business who tries to give you a call?

David Latina

I think it's a really significant change in terms of the establishment of the Australian Trade Remedies Commission. And aside from ch moving away from the title of dumping, it's also something really significant on that. And the f the first and most important thing is that it's actually all of the different elements of trade remedies are all in the one are all in the one authority now. so it leads to a more easier, almost one stop shop place for Australian industry that it feels that they're that they're experiencing injury from unfair market practices, that they've got one place to go. And so that's really significant. And it aligns with most other parts of the world, how they run their trade remedy systems as well. So it's a good sort of streamlining of process. It's also something where we can really build up our capability in the one spot. So I think

Hopefully industry feels that that they've got a more a more unified regulatory framework and one where we're making sure that we're using all the levers of trade remedies appropriately. The second big change that came together with the name of the change in the name of the commission is that so-called safeguards inquiries have

tr have been transferred and been brought in within the purview of the Australian Trade remedies commission. And that's really important because safeguards measures have become have become more significant over the years internationally and it's one we're in Australia where we haven't had a lot of experience in relation to those. There's a inquiry that the that the Productivity Commission is currently doing at the moment in relation to fabricated steel, but it's not one that's well known in Australia. But and the distinction with safeguards is that it's more about movements in in the volume of product as opposed to the d the price dumping of products in Australia that that impacts on injury as well.

Louise McGrath

I think I think you're right, it makes a big difference now that all that expertise in the government is in in one place. I mean, I think the Productivity Commission, there's also historical reasons why it had it, but you know, it's very hard, as they say, when they're not very often run to then, you know, build up that expertise and connections to industry and all that kind of stuff. So I think it is it is a big change, but hopefully it will make it easier for industry.

David Latina

Yeah, and I think and I think that something I hope when you ask question about how does how where will people businesses feel the difference, I hope that they feel that it's a more seamless system. I hope there also there's a number of reforms that we've been undertaking that have been around trying to make it as easy as possible for industry to engage with the system as well, with the trade remedy system. And so whether that's around our pre-application service, which is about businesses that are looking to potentially put in an application for a trade remedies measure where we sort of sit down with them, take them through the process so that they understand what's required and that we get a better quality application if they come through with it and they're at they're in a better position to actually provide all the data and material that's necessary in order to put forward a successful application as well. And there's a whole lot of and that also leads to a quicker process as well. Cause if we know that if we're we've got a better prepared applicant that's got the data at hand, it makes our life easier in terms of being able to investigate and progress an application as well. So that's something that we've really focused on in the last couple of years in terms of providing as much front end support as we can because it works well for both of us with industry and ourselves in terms of progressing case, particularly those businesses that are really being injured at the moment through unfair practices and they need the support as soon as they can get it.

Louise McGrath

I'm glad you mentioned the reforms. just for the benefit of those listening. So I represent Australian industry group on the International Trade Remedies Forum, which feeds into the Commission, and co-chaired with a fellow member from the CFMEU Manufacturing, a subcommittee looking at a range of reforms, and the Safeguards move was one of them, but it was also arranged that such as you you've outlined, David, just to think about ways to make it easier for people to access the system. But also, you know, we knew that in sort of constrained times we weren't probably going to be successful in saying you needed more resources. So of course we always say that, but give you more control in managing those resources so that you know, you can apply them as needed where where as issues come up rather than being forced to apply them in in other areas that deadlines, etcetera.

David Latina

Yeah, well I'm well I'm pleased that the government has given us for the last two years additional funding and that's enabled us to increase the number of investigators that we've had and that we have and also enabled us to invest in improved systems as well and that's the and industry's starting to see the benefits of that investment through you know lower case times which have which have dropped significantly.

And we continue but it's continues to be a work in work in progress. And also, the government's really committed to there are things that there are things that the Commission can do in terms of how we go about the work, and making sure that we're as efficient and streamlined as we can be, that we engage with industry as much as we can so that we get a better process. But also the as you say, the legislative framework that underpins the system.

is fit for purpose and that it's modernized and safeguards, moving safeguards is c and providing a legislative framework for safeguards is one of the a really significant reform, a really significant reform. There's also been some other legislative reforms that have already been introduced that are about from a regulatory reform taking making it simplify simplified for the for industry on both for importers as well as for local manufacturers. And the government's also indicated that it's keen to progress further legislative reforms as well. So what's your space?

Louise McGrath

Yeah, no, I think it's great movement. Anyway, we'll take a short break and then we'll get back into the detail.

David Latina

Great.

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Louise McGrath

Welcome back to and welcome back. Today I'm speaking with Dave Latina, Commissioner of the Australian Trade Remedies Commission.

So David, many I know we've talked about a number of the reforms that are coming, and so you know, I suppose the purpose of this p podcast is to let people know so that if they've got some pre existing ideas that we can sort of challenge them. But a lot of mid-sized manufacturers and importers have told us that the system's too slow, it's too costly to use, have to use consultants, you know, all this all the data at collection is complicated. What do you think is driving those delays? What can you control? And how do you think these changes will improve that?

David Latina

look, I'm not gonna suggest to you that the trade remedy system is not is an easy way place to for industry to navigate. it is a complex framework and it's been established by at the high level with the World Trade Organization and reflecting that then it's in the Australian the Australian legislation, the Customs Act nineteen one.

I mean it's been a legislative framework that's been that's been built on since the first anti-dumping amendments were made in nineteen six. So it's a very challenging, very prescriptive legislative framework that we're operating in and that the cu the commission and me as commissioners responsible for enforcing and following the provisions of the act.

It's also a lot of it though is about giving procedural fairness and transparency to the work that we do and also the investigations that we undertake and ensuring that anyone that's got a particular interest or wants to put their argument forward has got that opportunity to do so and that the analysis that we do is really rigorous and transparent. So for instance,

You know, we d we can't initiate our own investigations. Industry's gotta come to us with an application. I've got to assess that application and say that it and see whether it meets the minimum legislative requirements of it in terms of industry standing and things like that. if it does it, I can initiate an investigation within sixty days. I need to put out a report to say what the update on or where the status of that investigation is. Then we call we call for submissions. We put it send out questionnaires. People provide us with the data that we need to do very detailed calculations around what we call dumping margins. We put out a draft report or a preliminary report called a statement of essential facts. We put that out we put that out again and we publish that and get submissions back on it.

David Latina

And then we consider we carefully consider those submissions before making a final report that then goes to the minister, and the minister ultimately makes the final decision in relation to whether measures should be introduced or not. So it's it is a long process. Investigations can take a long time. It does require a lot of evidence from the applicant because it's also you've got people on the other side of the argument who are also putting their data and evidence on that and that's then it's up to us to sort of interrogate that data and see in terms of what we consider is the appropriate finding. but having said that, as I said, we've been doing our best at the commission to work with businesses, particularly work with SME, small and medium enterprises to be able to make it as accessible as possible. We've also got what's called intro, which is from the department to specifically provide information and advice to small and medium businesses, the department of industry, science and resources. and we also work with them to identify areas where they can further strengthen their arguments or whether there's data gaps missing and seeing as to how they can do how they can address that. And as I said that earlier in terms of just it streamlines the process a lot. The other thing is also that we've found really helpful, I think, for industry has been working with industry associations. And there's a couple of cases that we've been that we're running at the moment that where industry associations are a party to the application. And so the industry associations are playing a really key role in terms of supporting and bringing together those interests and be able to help them launch the application and fund the cost associated with the work associated with that. And then I'd say as I said

David Latina

you know, through the through great advice from the the International Trade Remedies Forum that you're on and other key industry players are on, they're always providing great feedback and advice in terms of how we can do things smarter, in a in and in a more timely and speedy way. And we're always looking for ways to do that, whether that's through operational improvements or whether that's through legislative reforms.

Louise McGrath

Well I think I mean in order for people to have confidence in a system it has to be rigorous and fair. So I think, you know, that that is just a function of having a system that people can support. And, you know, the outcomes can mean high duties for importers. So, you know, it always needs all that evidence, I think, to support it.

David Latina

I think the other thing that we've also been really, you know, more active on in the last couple of years is what we what we introduce as like interim measures or what what's technically called preliminary affirmative determinations. And so this is one where if there's an application and that that's come forward and we're assessing we're assessing that application, we're undertaking the investigation and we can see that there's in injury that there's dumping already taking place, that in the local industry is being injured, rather than waiting the long period of what an investigations take, which may well be a year or so, that we that I can take immediate action in terms of introducing interim measures, temporary measures called PA Ds, as I said, and that means that industry is supported while the application and the investigation process is completed. And so that's really important in terms of saying, well, we're not going to wait until the end of the final the final investigation, if the evidence is already very apparent up front that that injury is being caused by dumping. And so we've introduced eleven of those PADs, the pads, in the last couple of years as well. And that's been a significant change in terms of improving the speediness of the process.

Louise McGrath

Now I think with all the geopolitical shifts around the world and you know the impact it's having on the trading system, a lot of companies, including Australian companies, are getting very good at circumvention. So once duties land, some companies do shift supply through related exporters. How does the Commission deal with that? And does the law give you enough to work with?

David Latina

Yeah, look, circumvention is really a significant, a significant topic and really at the forefront of our minds at the moment. As we know, it's the Australian border force monitors and enforces those the measures that we put into place, but in terms of actually whether the measures are appropriate and they're capturing all of the activity that's the dumping activity that's taking place.

That's often something where industry will come to us. Clearly, circumvention is an unfair market practice. It's very hard sometimes to detect that, particularly when you've got really complex when you've got really complex supply chains that make their way through the world and it's an opportunity for exporters to evade those trade remedies by employing really sophisticated value chains. Or in some cases it might be for instance that that they might change the color of a product or something as a way of obscuring the obscuring the nature of the product as well and fall without out scope. And in those sort of situations, you know, we'll very, very carefully examine those and if we need to take action by introducing a an undertaking an anti circumvention inquiry then we will do that and it's also something that we're and we have done that, we've done that in in and we've undertaken three really significant anti circumvention investigations in in the last eighteen months and it's also something that we're very much we very much connect in with our international colleagues in the European Union or the UK or the US or Japan or Korea and actually where we compare notes on actions that we're taking and where we see that the risks are for our local industry of where circumvention activity is taking place. And so it's a very active space at the moment.

Louise McGrath

Well I think with global trade tensions rising, you're only going to get busier. W where should members go first if they'd like more information?

David Latina

I think the first place that would go would be the Australian Trade Remedies Commission. So we've got a reasonably comprehensive website, atrc.gov.au and it'll give you some key information in terms of in in terms of what's required in terms of what's required in terms of mounting a an application for trade remedies. But I'd say a lot of great the key industry associations like AI Group and others are really well understand the trade remedies system as well and can provide some initial advice and also as I mentioned earlier the intra which is the International Trade Remedies advisory service of the of DISA, the industry department, can really provide some practical advice also for especially for small and medium sized enterprises.

Louise McGrath

And I think importers can also access that service as well, can't they?

David Latina

That's true. That's absolutely right.

Louise McGrath

Yeah. Well, thank you very much, David. I think, you know, this is a very big, and as you say, very complex old area of trade law. So I think we've done a pretty good job to skim over the top with some sort of good topics. But thank you very much. And thanks for listening. If you have any questions or comments, please email us on industry.policy@australianindustrygroup.com.au

And if you found this podcast via a link on our website or someone to send it to you, please do subscribe on your usual podcast platform and leave a review. It does help more people to find us. And we'll speak in a couple of weeks.