Groser Tim: Customs and Excise Amendment Bill (No 2) — In Committee 
Text is incorporated into the Bound Volume 
Groser Tim: Customs and Excise Amendment Bill (No 2) — In Committee 
[Sitting date: 27 February 2007. Volume:637;Page:7711. Text is incorporated into the Bound Volume.] 
TIM GROSER (National) 
: 
 I will take a brief call on Part 1 and essentially address the same issue that Mr Locke has just addressed. It is a fairly technical point of course but it relates to an issue of great concern on the part of all political parties I am sure in this Parliament and in most countries in the world. That is the issue of the misuse of dual-use technology for weapons of mass destruction or for military purposes that probably no New Zealander would want to see associated with us. We have had prohibited export regimes for a number of years and I think the Foreign Affairs Defence and Trade Committee in looking at this bill was trying just to fine-tune that regime in line with modern realities. 
Various international agreements are in place: the Wassenaar arrangement covers conventional arms and duel-use technology there are the Nuclear Suppliers Group and the Missile Technology Control Regime and no doubt there are several others that I cannot think of off the top of my head at this point. So there is a fairly elaborated international regime. The fact that we are very small I do not think obviates the need for New Zealand to play its part in that because quite assuredly although probably no companies in this country are capable of producing the finished article there are certainly companies in our country that whether or not they intend it produce the componentry of commodities used in the production of these devices. 
We have had as the centrepiece of this for a number of years the Strategic Goods List. We have had procedures that have worked tolerably well I suppose up until now but that obviously need to be updated in the light of current requirements. The standard procedure if I understand it correctly is that these goods are prohibited unless otherwise permitted. So it is a “prohibition with exceptions” approach to ensure that people with legitimate trading interests as often will be the case with dual-use technology exports are not prevented from building up their own export industries and providing jobs and employment for New Zealanders. 
The general feeling in the select committee hearings was that the procedures lacked a certain flexibility. The select committee looked at the proposals and came to a consensus I think that made some sense for us. Obviously this is a shifting target. What is deemed to be an undesirable good today can change very rapidly tomorrow. To bring it down to the retail level for example we have seen that in respect of the types of devices that people can bring on to aircraft. So this has to be a procedure that is flexible that takes account of modern intelligence and that can respond very quickly to a change in international circumstances. As a previous speaker pointed out the criteria are generally the end use the destination and the taking into account of all these factors rather than technical characteristics of the good per se. Obviously a certain subjective element must inevitably come into this but I think the legislation before the Committee is a reasonable compromise in trying to balance the needs of legitimate exporters with the very important broader political and strategic objectives for which this legislation is designed. 
Some of the submitters were concerned quite reasonably about the transparency of the rules and about ensuring that exporters of dual-use technology were not caught out. What we have here in terms of an Order in Council gives the authorities—in this case it will be exercised formally by the Governor-General acting on the recommendation of the Secretary of Foreign Affairs and Trade—a sensible and efficient way through this. The prohibition will of course come into effect when the determination is made by the authorities but we have concentrated on some improved notification procedures to ensure that legitimate exporters are aware of the arrangements and that their interests can be accommodated. 
To sum up I have focused on one aspect of Part 1. It is a very technical point but it has become of increasing concern to the international community in which we try to play our part. I think we have arrived at a fair and balanced solution.