The federal government will not be providing its legal advice around the introduction of a so-called container levy despite the documents being requested by a Senate committee last week.
However, it has finally revealed why it will not introduce a sea-freight import charge the agriculture industry has demanded for years.
The situation has reached fever-point in recent months with the government seeking to create a new $51 million biosecurity protection levy to be paid by farmers under its $1 billion sustainable biosecurity funding model.
During a public hearing of a Senate inquiry into the BPL last week, Department of Agriculture, Fisheries and Forestry general counsel Cassandra Ireland confirmed that the department had in fact sought advice on the World Trade Organisation and free trade agreement issues associated with revenue measures in relation to biosecurity.
Senator for the ACT David Pocock then asked for that advice to be tabled for the committee, which is due to hand down its report on May 10.
Ms Ireland responded to say, "We'd have to talk to (Agriculture Minister Murray Watt) about a potential PII claim in relation to the tabling of that sort of advice, so I can't commit to tabling that advice today, but we can take that on notice".
Mr Pocock responded that he hoped the advice would be provided, saying that "if this whole thing (BPL) is hinging on you telling us that. I'd love to see it".
A government source however has revealed that the advice would not be provided to the committee, falling into line with an Albanese government position to not make legal advice public.
ACM Agri asked DAFF if the advice was provided by the Australian Government Solicitors Office or the Department of Foreign Affairs and Trade, however it responded to say that "legal advice is obtained in accordance with the Legal Services Directions 2017".
In February, the government refused to reveal to ACM Agri whether it had or had not received legal guidance relating to a long-awaited container levy being introduced in Australia due to legal privilege.
A Public interest immunity (PII) claim, or Crown privilege, is when a government seeks to claim immunity from requests or orders, by a court or Parliament, for the production of documents on the grounds that public disclosure of the documents in question would be prejudicial to the public interest.
Despite the refusal to disclose the advice, its contents may have been somewhat inadvertently spilled at the Senate inquiry.
In responding to questioning from committee members, department officials revealed that it was unable to ask importers, or 'risk creators', to fund biosecurity as it could be seen as revenue-raising or a tax and in breach of some of Australia's international trade obligations.
The government last year raised Full Import Declaration for sea cargo from $49 to $63.
Greens Senator Peter Whish-Wilson said he found the situation "concerning".
"Could I just clarify the comments in relation to cost recovery for importers. There was a distinction made that if we went over cost recovery by charging them more than the existing fee, which I understand is $63 a container, it would be considered a tax," he said.
"Can I just be clear here: would that be considered a tax under international trade rules and therefore would not be cricket under trade rules? Is that it - once it goes from cost recovery to a tax it's against our trade obligations? Is that an easy, clear way to understand what you've just said?"
DAFF biosecurity and compliance group deputy secretary Justine Saunders responded to say: "That's my understanding, as a principle".
Senator for Queensland Matt Canavan then asked for clarification, saying "you were.. implying there is some barrier to us increasing the FID a little bit further, another $17 or $18, to cover this deficit you have. What's that barrier?"
Ms Saunders replied that "the barrier is: we can only cost-recover those costs from importers".
"To do anything more than that would bring into question the nature of our trade arrangements and would then potentially have impacts on our own industry as we seek to export, knowing these responsibilities are reciprocal," she said.
The inquiry was also told by DAFF biosecurity strategy and reform division first assistant secretary Bronwen Jaggers that a Freight and Trade Alliance proposal to take on the BPL burden for farmers "has many of the same challenges".
"Adding an additional charge into the FID, for example. It's really the same issues, in their proposal," she said.
Central considerations for the viability of a container levy are believed to be China's reaction to what it would likely view as a new tariff placed on its exporters and the potential for another nation to challenge any new levy at the WTO as an unfair tariff.
Any new levy would also need to satisfy requirements under the General Agreement on Tariffs and Trade and Free Trade Agreements.
Cattle Australia chief executive Chris Parker, who appeared at the Senate inquiry, urged the government to release the advice to the Senate and industry, particularly in light of current import levies "not covering the entire gamut of importers".
"We would like the Senate to at least see the advice that putting some sort of levy on importers is somehow against WTO rules," Dr Parker said.
"Both the benificiaries and those creating the risk should be paying equitably for this, and we don't think singling out one sector, which is the agriculture sector, as the sole beneficiary of this system is fair and reasonable."
