China-Australia relations: New Zealand not ‘taking sides’ by joining WTO dispute panel on barley tariffs
- The World Trade Organization (WTO) has agreed to establish a panel to resolve Australia’s complaint over anti-dumping and countervailing duties imposed by China on its barley exports
- New Zealand was the first to join the panel as a third party, although a resolution could still take many years
New Zealand’s participation in the World Trade Organization (WTO) dispute settlement panel over Australia’s barley trade row with China is not a sign that Wellington is taking Canberra’s side, International trade lawyers and experts said.
The WTO on Friday agreed to establish a panel to resolve Australia’s complaint over anti-dumping and countervailing duties imposed by China on its barley exports, with New Zealand first to join the panel as a third party.
However, the resolution of the dispute could still take many years, with some similar cases previously taking up to five years, trade experts said.
New Zealand trade minister Damien O’Connor said on Saturday the island nation would participate in the case as it would raise “systemic issues of importance to the effective functioning of the multilateral rules-based trading system”.
The WTO panel will ultimately decide who is right and it is our strong preference to see disputes resolved in the WTO
“New Zealand upholds international rules and norms, so ensuring international trade rules are fairly applied by others is important to us and our exporters,” O’Connor said.
O’Connor also said New Zealand’s participation was voluntary, and historically it had been a third party in over 60 WTO cases.
As it was common for third countries to join in WTO dispute settlements, it was not accurate to say New Zealand was “siding” with Australia by signing on as a third party to the barley dispute, said Stephen Jacobi, former executive director of the New Zealand China Council and founder of the New Zealand International Business Forum, pointing to inaccurate local news reports.
“That is not how the WTO dispute settlement process works. The WTO panel will ultimately decide who is right and it is our strong preference to see disputes resolved in the WTO. Our decision to join as a third party neither helps nor hinders Australia, or China for that matter,” he said.
In this particular case, perhaps it could also reveal more broadly how the bilateral relations or tensions between China and Australia will develop next
Weihuan Zhou, an international economic lawyer at the University of New South Wales Law’s Herbert Smith Freehills China International Business and Economic Law Centre agreed, adding that while third parties usually have limited rights in a dispute case, they join such cases to have a say in the development of trade case law.
Major WTO members such as the United States, European Union, India and China have joined many cases as third parties in the past, Zhou noted.
“In this case, the extent to which New Zealand will support Australia’s claims is unclear,” Zhou said.
“At the end of the day, it is the panel’s decision, based on evidence and legal arguments from the disputing parties.
“In this particular case, perhaps it could also reveal more broadly how the bilateral relations or tensions between China and Australia will develop next.”
Recently, New Zealand last joined Australia in a dispute case over wine sales in Canada.
After more than three years, that case was mutually resolved last month, with Canada lifting a series of trade restrictions on the sale of Australian wine, including market access and federal and provincial duties and taxes.
Zhou said that in the barley case, as with other disputes, even if Australia “won”, it would take China some time to remove the anti-dumping duties.
Australia argued China’s barley duties were inconsistent with its international commitments and obligations. It also said China initiated its investigation without sufficient evidence and failed to obtain evidence to support dumping allegations.
Both parties, however, said they were openly committed to continuing discussions.
“Australia remains open to further discussions with China with a view to resolving this issue,” Australia trade minister Dan Tehan said on Friday ahead of the dispute settlement body meeting in Geneva.
We’ve had detailed discussions with the wine industry on this … obviously, a very important step is to go to the World Trade Organization and to deal with this as a dispute there, and that’s something we have under active consideration
“We’ve had detailed discussions with the wine industry on this … obviously, a very important step is to go to the World Trade Organization and to deal with this as a dispute there, and that’s something we have under active consideration,” Tehan said.
