EXPLANATORY STATEMENT
STATUTORY RULES 1983 No. 175
Issued by the Authority of the Minister for Primary Industry
DAIRY PRODUCE EXPORT CONTROL (LICENCES) REGULATIONS (AMENDMENT)
The Dairy Produce Export Control (Licences) Regulations prohibit the exportation of dairy products from the Commonwealth except by a person who holds a licence. The regulations are designed to enable control to be exercised over the export of dairy produce.
Australia has entered into certain treaty obligations under the GATT International Dairy Arrangement (IDA) and, as a result, has undertaken to observe the conditions for the export of dairy products as laid down by the IDA. The IDA provides, inter alia, for minimum prices for certain dairy products exported to be observed at the free on board level. Since 1 October 1981 these have been as follows:
Dairy Products | $US Per Tonne |
Skimmed milk powder | 600 |
Whole milk powder | 950 |
Buttermilk powder | 600 |
Anhydrous milk fat | 1,440 |
Butter | 1,200 |
Cheese | 1,000 |
In December 1981, a Ministerial directive was issued to the Australian Dairy Corporation (ADC) to the effect that the ADC was to ensure that prices for dairy products, specified in the IDA Protocols, exported from Australia did not fall below IDA minimum prices. The ADC, in May 1982, advised all holders of export licences that they were required to observe IDA minimum prices and that a failure to do so may result in the ADC recommending to the Minister for Primary Industry that the licence be withdrawn. In taking this action, the ADC was exercising its powers under Regulation 10(a) of the Dairy Produce Export Control (Licences) Regulations to approve terms and conditions for the export of dairy produce to countries other than the United Kingdom.
Advice from the Attorney-General’s Department has, however, indicated limitations on the Minister for Primary Industry’s powers to give directions under the Dairy Produce Export Control (Licences) Regulations with regard to the terms and conditions for the export of dairy products and the cancellation of licences. In particular, the Minister for Primary Industry, in effect, cannot direct the ADC to direct private traders with regard to the observance of minimum prices. Further, in the absence of a proper direction, the Minister does not have the power to cancel or suspend licences following a breach of IDA minimum prices.
The present situation is not regarded as fully satisfactory. It is therefore proposed to amend Regulation 8 of the Dairy Produce Export Control (Licences) Regulations to make the observance of IDA minimum prices a specific condition for the exporting of dairy products. In the event that a licensee is shown to have exported dairy products at a price below the specified IDA minimum, this will provide grounds for the Minister for Primary Industry cancelling or suspending the licence.
As the GATT IDA minimum price conditions apply to whole milk powder, it is considered desirable to prescribe whole milk powder as a dairy product under Regulation 4A to remove any doubt that it falls within the definitions of dairy products for the purposes of the Dairy Produce Export Control (Licences) Regulations.
Overview
The Dairy Produce Export Control (Licences) Regulations (Amendment) Statutory Rules 1983 No. 175, enacted by the Australian Parliament, was introduced to address limitations in the enforcement of minimum export prices for dairy products as stipulated by the GATT International Dairy Arrangement (IDA). The regulations aim to ensure that the prices for exported dairy products from Australia adhere to the minimum levels set by the IDA, thereby fulfilling Australia's treaty obligations. The policy objective is to provide the Minister for Primary Industry with the authority to suspend or cancel export licenses in cases where the minimum prices are not observed, thus maintaining compliance with international trade agreements and protecting the interests of Australian dairy producers.
Scope and Application
The Dairy Produce Export Control (Licences) Regulations, as amended, apply to all persons or entities involved in the export of dairy products from the Commonwealth of Australia, including licensed exporters. The primary aim of these regulations is to regulate the export of dairy produce by ensuring compliance with the minimum prices stipulated under the GATT International Dairy Arrangement. These regulations are applicable nationally within the Commonwealth, ensuring a consistent regulatory approach across all states and territories. The regulations do not explicitly state exclusions or exemptions, but they are intended to apply to all relevant dairy exports unless otherwise specified through subordinate instruments. The amendments to Regulation 8 specifically address the enforcement of IDA minimum prices, providing a clear condition for the issuance, cancellation, or suspension of export licenses. Additionally, the amendment to Regulation 4A clarifies that whole milk powder is included under the definition of dairy products, thereby ensuring that it falls within the scope of the regulations. These regulations extend their reach through subordinate instruments, which may further detail the conditions and enforcement mechanisms associated with dairy exports.
Key Provisions
The main provisions of the Dairy Produce Export Control (Licences) Regulations (Amendment) focus on ensuring that dairy products are exported from Australia in accordance with international minimum prices set by the GATT International Dairy Arrangement (IDA). Under Regulation 8 (as amended), it is now explicitly stated that the observance of IDA minimum prices is a specific condition for the export of dairy products. This means that any exporter must adhere to these minimum prices to maintain their export licence. Regulation 4A is also amended to include whole milk powder as a dairy product, thereby clarifying its inclusion within the scope of the regulations and ensuring that it is subject to the same minimum price requirements as other dairy products.
These regulations impose several obligations on the parties involved. Firstly, any person or entity exporting dairy products from Australia must hold a valid export licence. Secondly, they must ensure that the prices at which they export these products meet or exceed the minimum prices specified under the IDA. Failure to comply with these price conditions can lead to serious consequences, including the potential cancellation or suspension of their export licence by the Minister for Primary Industry. This obligation extends to all licence holders and requires them to maintain strict adherence to the minimum price thresholds set forth by the IDA.
The amendments also introduce significant consequences for non-compliance with the minimum price conditions. If a licensee is found to have exported dairy products at prices below the specified IDA minimum, the Minister for Primary Industry now has the authority to cancel or suspend their licence. This is a clear departure from the previous situation, where the Minister did not have the power to take such action in the absence of a proper direction from the Australian Dairy Corporation (ADC). The potential for licence cancellation or suspension serves as a strong deterrent against non-compliance, ensuring that exporters adhere to the established minimum prices. The severity of these penalties underscores the importance of complying with international trade obligations and the consequences of failing to do so.