This week the Australian Senate has referred an inquiry into non-conforming building products to the Senate Economics References Committee. The committee’s report is due on 12 October 2015. The terms of reference require the committee to investigate the economic impact of non-conforming products, and their impact on safety, costs and quality of construction.
In August and October last year the Australian Competition and Consumer Commission (‘ACCC’) ordered recalls of Infinity brand electrical cables, citing the cable’s brittle insulation as posing a fire risk. Then, in November, an apartment block in Melbourne suffered damage to 13 of its 21 storeys when a cigarette left on a balcony started a fire that quickly spread. The building contained imported cladding that was later found not to meet the technical requirements of the Building Code of Australia.
These events and a number of others have been the catalyst for the inquiry. Senator Nick Xenophon – who co-sponsored the establishment of the inquiry – said that “[t]he regulatory regime appears to be flawed or simply not working and this is not just about Australian jobs that are at risk, this is also about Australian lives that are being put at risk with these products.”
Although the terms of reference do not single out imported products, surrounding media suggests that Australian manufacturers are going to target them in the inquiry. Moulis Legal senior associate Alistair Bridges points out:
The maintenance and enforcement of construction and construction material standards is critically important. Efforts to improve public safety should be applauded.
But the committee needs to be even-handed to ensure that any recommendations and subsequent actions comply with Australia’s WTO obligations. No one wants to see safety compromised, but over-specification or unusual requirements can be unnecessary obstacles to international trade.
The inquiry should not be used as a forum to impede importers and their overseas suppliers for anti-competitive purposes.
The Senate inquiry is currently accepting submissions. No deadline for submissions has been set as yet.
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