NZ Steel wants High court to overturn decision not to tax imports from China

New Zealand Steel wants the High Court to overturn a decision by the government not to tax Chinese steel imports. Picture / Glenn Jeffrey

New Zealand Steel wants the High Court to overturn a decision by the government not to tax Chinese steel imports, which the firm says flooded the local market and cut into profits.

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.

Today, NZ Steel's lawyer Jack Hodder QC told the Wellington High Court that the heart of the application was whether the ministry had "effectively superseded material that was available to it from previous investigations".

Reputable overseas regulators have found that China has subsidised and dumped steel, Hodder said, meaning the New Zealand government's decision is "deviation from the findings of other jurisdictions".

"In Australia, and Canada, and the European Union, and the United States, it has been identified as a black swan, but New Zealand identifies it as a white swan, but it's the same bird," Hodder said.

"There's something wrong going on - there's something odd. We say that whether or not the swan is black is an objective fact, not a matter of discretion, and that's where the debate between us in part will be."

"The analysis is being challenged, and the investigation," Hodder said. "What steps did they take to establish what colour the swan was - I don't want to torture this metaphor too far - and show the good sound reasons that justify why we found a white swan when the rest of the common law world is finding black swans."

Hodder said that over the 20th and 21st centuries there has been a movement in public law from a culture of authority to a culture of justification, meaning the government has to be able to justify its use of public power, whereas in the past it was able to claim authority without question.

NZ Steel wants the court to quash the decision and have it be reconsidered by going back and re-investigating the matter. The hearing, before Justice Jillian Mallon, is set down for the rest of the week.