Government denies political concerns behind choice not to tax Chinese steel imports

Government says relationship with China isn't behind choice not to tax Chinese steel imports. Photo / Glenn Jeffrey

The government says political considerations about New Zealand's relationship with China aren't the reason why it chose not to tax Chinese steel imports, as local steel producer New Zealand Steel attempts to have that decision overturned in the High Court.

In July 2017, then-Commerce and Consumer Affairs Minister Jacqui Dean decided not to impose countervailing duties on imports of galvanised steel coil from China, following an investigation by the Ministry of Business, Innovation and Employment which found that Chinese subsidies on the steel were too small to have injured the domestic industry.

NZ Steel, which is a wholly-owned subsidiary of Australia's Bluescope Steel, lodged an application for judicial review of the former minister's decision in September 2017.

It says Chinese steel flooded the local market and cut into its profits, and wants the court to quash the decision and have it be reconsidered by going back and re-investigating the matter.

The hearing began on Monday, and is set down for the rest of the week, in front of Justice Jillian Mallon.

In opening the government's reply today, the Crown's lawyer James Every-Palmer QC said all relevant considerations were taken into account in making the decision, based on information that was available to it and that it considered to be reliable, and that it provided full reasons and correctly interpreted the act and did not act unreasonably.

"The application for judicial review here attacks matters that are really for the decision maker - the process of inference, the weighting of evidence, and the evaluative judgements it made," Every-Palmer said.

"In our submission it's fair to characterise the application as seeking a merits review of the decision that was made, effectively an extra round of the decision-making process, but one in which there's only one interested party participating, and so the new material and evidence presented hasn't been tested in any systematic way."

Every-Palmer stressed the decision was "absolutely was not affected by any concerns about how China might react", and later referred to an affidavit from former minister Dean on her making the decision not to impose duties.

Dean noted that "during the investigation, I recall noting media reports about the visit by the Premier Li Keqiang to New Zealand around March 2017, but the matter discussed in those media reports did not affect my decision in any way", Every-Palmer said.