STATE TRADING
ReplY to the Question[1]
Posed By Chile regarding
the new and full notification of NEW ZEALAND[2]
The following communication, dated 21 October
2016, is being circulated at the request of the Delegation of New Zealand.
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Question
As mentioned in the last meeting
of the Working Group on State Trading Enterprises, as well as the Agriculture
Committee in June, New Zealand is undertaking amendments on the Kiwifruit
Export Regulations 1999.
As stated in the current
regulation (Kiwifruit Export Regulations 1999), Zespri's core business is:
"a) the purchase of New
Zealand-grown kiwifruit for export where the point of acquisition of title to
fruit is at FOBS6 and the export of that fruit;
b) excludes the export at FOBS of
kiwifruit for consumption in Australia; and
c) excludes the sale of kiwifruit
in New Zealand."
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7 Regulation 11(2) provides that Zespri is able to supply the New Zealand
market provided the level of sales is incidental to the size of the total New
Zealand market, and provided the total sales do not exceed 300,000 trays
of kiwifruit.
According to the latest
information provided in the Ministry of Primary Industry's website, the Cabinet
agreed changes to the Kiwifruit Export Regulations 1999, one of them being
Zespri's core business. Regarding this issue, it notes that the purpose is to
"clarify that Zespri's core business includes the marketing of New
Zealand-grown kiwifruit, market development for New Zealand-grown kiwifruit,
and kiwifruit research and development." The objective of these changes
would be "to provide more certainty about the business activities that
Zespri can undertake without seeking the approval of its providers of capital,
while also streamlining the process by which Zespri can seek approval."
Moreover, paragraph 21 of the
Nairobi Decision regarding Export Competition states that "Members shall
make their best efforts to ensure that the use of export monopoly powers by
agricultural exporting state trading enterprises is exercised in a manner that
minimizes trade distorting effects and does not result in displacing or
impeding the exports of another Member."
Given that Zespri represents more
than 40% of the world's kiwifruit exports, holding significant shares in many
different markets around the globe, the Government of Chile would like to ask
the following question:
How will the Government of New
Zealand ensure that the "market development" strategies undertaken in
foreign markets- that will be part of the core business of Zespri (a private
company, as New Zealand commonly alleges)- will comply with the international
commitments undertaken by the New Zealand Government, particularly those
recently entered in Nairobi?
Reply
We
welcome Chile's acknowledgement that, Zespri Group Limited (Zespri) is a
private company owned by kiwifruit growers. The New Zealand Government has
no ownership interest in or control of this company. Zespri does not
receive trade-distorting subsidies, tax advantages, special financing, or
preferential access to foreign exchange. The New Zealand Government has ensured
that the regulatory structure that governs the export of kiwifruit from New
Zealand is consistent with New Zealand's WTO obligations, including those
introduced as a result of the Nairobi Decisions. New Zealand is ready and
willing to answer any question Chile may have regarding the regulation of
kiwifruit exports from New Zealand. These regulations are set out in New
Zealand's Kiwifruit Export Regulations 1999, which are publically available on
the New Zealand Legislation website - http://www.legislation.govt.nz.
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