153 Memorandum From Marcusson To Attorney General's Department

12th October, 1956

CANBERRA

Trade Negotiations with Japan-Amendment of Customs Tariff (Industries Preservation) Act

On 21.5.56 Cabinet (by Decision 203) [1] authorised the Department of Trade to enter into formal trade negotiations with Japan with a view to the conclusion of a trade agreement between Australia and Japan.

2. At the same time Cabinet also decided that the Customs Tariff(Industries Preservation) Act should be amended to enable emergency duties to be applied to the extent necessary to control low-cost imports from Japan so as to avoid serious damage to Australian industry or established patterns of trade. This Act is administered by the Department of Customs and Excise.

3. Shortly after Cabinet's decision the Department of Trade became involved in important and protracted trade negotiations with the United Kingdom. These negotiations are still under way and it had been hoped that the commencement of formal negotiations with Japan could be deferred until the negotiations with the United Kingdom had been concluded.

4. Following discussions between the Department of Trade and the Japanese Embassy early this week it became evident that the commencement of formal discussions with Japan could not be delayed for more than another fortnight or so and, in fact, the Department of Trade has agreed to open negotiations with a trade delegation which will arrive in Australia from Japan at the end of this month.

5. The Department of Trade has advised that the timing and likely trend of the coming negotiations has made the amendment of the Customs Tariff (Industries Preservation) Act a matter of urgency and that it will be necessary for the amendment to be made during the present session of Parliament.

6. The nature of the proposed amendment has been discussed with the Department of Trade and it is our joint view that the insertion in the Act of a new section some-what on the following lines would meet the problem with which we have to deal:-

'If the Minister is satisfied that any goods are being imported into Australia from any country in such increased quantities or under such condition as to cause or threaten- (a) serious injury to producers in Australia of like or directly competitive goods, or (b) serious injury to producers in a third country of like or directly competitive goods which are entitled to entry under the British Preferential Tariff or any lower tariff, he may, subject to any obligations incurred by His Majesty's Government in Australia to the Government of another country under or by virtue of an international agreement relating to tariffs or trade, publish a notice in the Gazette specifying the goods as to which he is so satisfied.

Upon publication of the notice, there shall be charged, collected and paid to the use of the King, for the purposes of the Commonwealth, on those goods imported into Australia a special duty (in this section referred to as "the emergency duty").

The amount of the emergency duty in each case shall be the sum which represents the difference between the landed duty paid cost of those imported goods and a reasonable landed duty paid cost as determined by the Minister, having regard to the landed duty paid cost, if any, of like or directly competitive imported goods.

The emergency duty payable under this section shall be in addition to such other duties, if any, as are payable under the Tariff.'

7. In view of the urgency of this matter it would be appreciated if you could furnish me with your views as to the acceptability of the proposed new section as soon as possible. One of my senior officers (Mr Cork [2]) and an officer of the Department of Trade (Mr Robertson) will be available to discuss the matter with you at any time, if required.

1 Document 135.

2 E.J. Cork, Appraiser.

[AA : A1310/1, 810/1/39]