It is not unusual for parties to Australian competition law or regulatory matters to retain experts to give opinion evidence in support of their positions. It is less common in Australian trade remedy matters; however that appears to be changing.
This blog post reviews recent trade remedy cases in which expert evidence was offered and the emerging and potentially problematic current approach to expert evidence by the Anti-Dumping Commission (ADC).
Kinsman Legal considers that the ADC's approach to expert evidence would be substantially improved by prominently publishing clear guidance regarding how the ADC and parties should prepare and present expert evidence.
This blog post reviews recent trade remedy cases in which expert evidence was offered and the emerging and potentially problematic current approach to expert evidence by the Anti-Dumping Commission (ADC).
Kinsman Legal considers that the ADC's approach to expert evidence would be substantially improved by prominently publishing clear guidance regarding how the ADC and parties should prepare and present expert evidence.
Australian Federal Court practice note
Federal Court practice note GPN-EXPT (practice note) is a touchstone for expert evidence in Australian federal proceedings. The practice note is of course compulsory in Federal Court proceedings but is also often referred to before administrative decision makers in Australia. No doubt this is because the decisions of Australian administrative decision makers are reviewable by the Federal Court under the Administrative Decisions Judicial Review Act 1977 and section 39B of the Judiciary Act 1903.
The stated purpose of expert evidence under the practice note is for the Court to receive the benefit of the objective and impartial assessment of an issue from a witness with specialised knowledge based on training, study or experience (practice note at paragraph 2.2). The practice note applies to expert evidence provided by any party or to an expert appointed by the Court.
Competition and regulatory matters - economists at 50 paces
It is common for parties to competition and regulatory matters to engage expert economists to assist both administrative decision makers and the Courts. But experts from other disciplines are also used in competition and regulatory matters where decision makers need to understand how technical matters might impact the decision making criteria (see for example the evidence given in rail access matters in the Competition Tribunal and related Federal Court proceedings).
Australian trade remedies - increasing use of experts
Trade remedies are a form of regulation that impact a variety of industries. The officials and decision makers administering Australia's trade remedy rules are typically schooled in law or accounting but do not have in-depth knowledge of the industries impacted by their decisions. On that basis, the reader might be surprised to learn that industry experts have not commonly been used in Australian trade remedies matters (particularly given the prompting of the Productivity Commission in this respect - see recommendation 7.4, Productivity Commission Inquiry Report No. 48).
That now appears to be changing, particularly in the recent kraft paperboard investigation (Investigation 548), where substantial expert evidence was presented by parties and the Anti-Dumping Commission (ADC). However expert evidence was also presented in the wire ropes anti circumvention inquiry (Inquiry 483) and a power transformers investigation (Investigation 507).
Wire rope anti-circumvention
The ADC retained the Mining Electrical and Mining Mechanical Engineering Society (MEMMES) to provide a report on differences between certain wire ropes in anti-circumvention Inquiry 483. The report was duly provided by MEMMES but was disavowed by the ADC in its statement of essential facts (SEF) on the basis that the report did "not contain expert opinion regarding wire rope that is relevant to the inquiry". The ADC placed no weight on the report and claimed it was confidential when the SEF was first published.
The responding party to the inquiry understandably insisted that the MEMMES report be made available. The ADC made the MEMMES report public, contradicting its earlier claim of confidentiality. Parties made submissions on the MEMMES report and the ADC was forced to detail its reasons for disregarding the MEMMES report in the ADC's final report (Report 483 at chapter 4).
The ADC does not appear to have provided any detailed guidance to the author of the MEMMES report (at least no such guidance was published). The ADC's treatment of the MEMMES report was untidy to say the least.
Power transformers investigation
The company representing the Australian industry retained expert opinion in international transfer pricing to address whether transactions between related exporters and importers should be treated as arms length. The expert was retained on the basis that she read and agree to be bound by the Federal Court practice note. The expert report was provided complete with the questions the expert was required to answer and with assumptions and facts she should consider in preparing her report.
The expert report addressed a key issue in the investigation. However, the ADC did not give itself time to consider the expert report but rather terminated the investigation without considering the expert report. The ADC did not consider the expert report because "the Commissioner is required to terminate the investigation [...] if satisfied of one or more of the matters in section 269TDA. When the Commissioner reached the requisite state of satisfaction, he took steps to terminate the investigation and did not consider any further submissions" (Termination Report 507 at section 2.5).
The ADC's reasons for disregarding the expert report seem less than satisfactory. Is an administrative decision maker entitled at some unspecified time to disregard new and relevant evidence because he or she reached a state of satisfaction? That seems unlikely (Judicial Review of Administrative Action and Government Liability at [4.130]).
Kraft paperboard investigation
A pivotal issue in the kraft paperboard investigation (Investigation 548) was whether the Australian industry produced goods that were like goods to those being exported to Australia. Exporter Graphic Packaging International (GPI) put on expert evidence stating that the Australian produced goods were not like goods; the Australian industry and the ADC obtained expert evidence that said they were like goods. (See the Kinsman Legal blog entry discussing like goods in this matter.)
The ADC ultimately found GPI's evidence (expert evidence and other evidence) more persuasive and terminated the investigation on the basis that there was no Australian industry that produced like goods.
The ADC expert guideline
The ADC deserves credit for expressly stating in the ADC expert guideline how its experts should present evidence and (at least in the kraft paperboard investigation) transparently providing the detailed instructions that were given to its expert.
However there are problems with the ADC's approach.
Kinsman Legal's involvement with briefing experts and deploying expert evidence in trade remedies and other matters
Kinsman Legal assisted with obtaining and deploying expert evidence in matters mentioned in this article (the power transformer and kraft paperboard investigations) and before other agencies, tribunals and courts. Kinsman Legal can advise and assist parties to investigations, inquiries and litigation in respect of expert evidence.
Edit: minor clarifications
Federal Court practice note GPN-EXPT (practice note) is a touchstone for expert evidence in Australian federal proceedings. The practice note is of course compulsory in Federal Court proceedings but is also often referred to before administrative decision makers in Australia. No doubt this is because the decisions of Australian administrative decision makers are reviewable by the Federal Court under the Administrative Decisions Judicial Review Act 1977 and section 39B of the Judiciary Act 1903.
The stated purpose of expert evidence under the practice note is for the Court to receive the benefit of the objective and impartial assessment of an issue from a witness with specialised knowledge based on training, study or experience (practice note at paragraph 2.2). The practice note applies to expert evidence provided by any party or to an expert appointed by the Court.
Competition and regulatory matters - economists at 50 paces
It is common for parties to competition and regulatory matters to engage expert economists to assist both administrative decision makers and the Courts. But experts from other disciplines are also used in competition and regulatory matters where decision makers need to understand how technical matters might impact the decision making criteria (see for example the evidence given in rail access matters in the Competition Tribunal and related Federal Court proceedings).
Australian trade remedies - increasing use of experts
Trade remedies are a form of regulation that impact a variety of industries. The officials and decision makers administering Australia's trade remedy rules are typically schooled in law or accounting but do not have in-depth knowledge of the industries impacted by their decisions. On that basis, the reader might be surprised to learn that industry experts have not commonly been used in Australian trade remedies matters (particularly given the prompting of the Productivity Commission in this respect - see recommendation 7.4, Productivity Commission Inquiry Report No. 48).
That now appears to be changing, particularly in the recent kraft paperboard investigation (Investigation 548), where substantial expert evidence was presented by parties and the Anti-Dumping Commission (ADC). However expert evidence was also presented in the wire ropes anti circumvention inquiry (Inquiry 483) and a power transformers investigation (Investigation 507).
Wire rope anti-circumvention
The ADC retained the Mining Electrical and Mining Mechanical Engineering Society (MEMMES) to provide a report on differences between certain wire ropes in anti-circumvention Inquiry 483. The report was duly provided by MEMMES but was disavowed by the ADC in its statement of essential facts (SEF) on the basis that the report did "not contain expert opinion regarding wire rope that is relevant to the inquiry". The ADC placed no weight on the report and claimed it was confidential when the SEF was first published.
The responding party to the inquiry understandably insisted that the MEMMES report be made available. The ADC made the MEMMES report public, contradicting its earlier claim of confidentiality. Parties made submissions on the MEMMES report and the ADC was forced to detail its reasons for disregarding the MEMMES report in the ADC's final report (Report 483 at chapter 4).
The ADC does not appear to have provided any detailed guidance to the author of the MEMMES report (at least no such guidance was published). The ADC's treatment of the MEMMES report was untidy to say the least.
Power transformers investigation
The company representing the Australian industry retained expert opinion in international transfer pricing to address whether transactions between related exporters and importers should be treated as arms length. The expert was retained on the basis that she read and agree to be bound by the Federal Court practice note. The expert report was provided complete with the questions the expert was required to answer and with assumptions and facts she should consider in preparing her report.
The expert report addressed a key issue in the investigation. However, the ADC did not give itself time to consider the expert report but rather terminated the investigation without considering the expert report. The ADC did not consider the expert report because "the Commissioner is required to terminate the investigation [...] if satisfied of one or more of the matters in section 269TDA. When the Commissioner reached the requisite state of satisfaction, he took steps to terminate the investigation and did not consider any further submissions" (Termination Report 507 at section 2.5).
The ADC's reasons for disregarding the expert report seem less than satisfactory. Is an administrative decision maker entitled at some unspecified time to disregard new and relevant evidence because he or she reached a state of satisfaction? That seems unlikely (Judicial Review of Administrative Action and Government Liability at [4.130]).
Kraft paperboard investigation
A pivotal issue in the kraft paperboard investigation (Investigation 548) was whether the Australian industry produced goods that were like goods to those being exported to Australia. Exporter Graphic Packaging International (GPI) put on expert evidence stating that the Australian produced goods were not like goods; the Australian industry and the ADC obtained expert evidence that said they were like goods. (See the Kinsman Legal blog entry discussing like goods in this matter.)
- The GPI expert duly stated that he had read and would be bound by the terms of the Federal Court practice note (report by Charles Klass at page 2) and set out the questions he had been asked to opine on by GPI.
- The Australian industry expert did not refer to the Federal Court practice note, nor did he state the questions that he had been asked to opine on.
- The ADC appears to have provided its expert with the Federal Court practice note but the ADC instructed its expert to follow an ADC document entitled Guideline - Persons Giving Independent Expert Opinion (ADC expert guideline - discussed further below).
The ADC ultimately found GPI's evidence (expert evidence and other evidence) more persuasive and terminated the investigation on the basis that there was no Australian industry that produced like goods.
The ADC expert guideline
The ADC deserves credit for expressly stating in the ADC expert guideline how its experts should present evidence and (at least in the kraft paperboard investigation) transparently providing the detailed instructions that were given to its expert.
However there are problems with the ADC's approach.
- Firstly, the ADC expert guideline is not published on its website (except attached to the ADC expert's report on the electronic public register for Investigation 548). Parties to ADC investigations are entitled to know the basis on which the ADC conducts its investigations and inquiries. The ADC would be well advised to publish the ADC expert guideline prominently on its website.
- Secondly, the ADC expert guideline is only addressed to experts retained by the ADC. It does not address nor does it appear to anticipate that parties to ADC investigations might retain experts in support of their respective positions. That is unhelpful to parties and may even suggest that evidence from an ADC appointed expert would be given more weight than other experts. The ADC expert guideline appears to be based on the Administrative Appeals Tribunal expert guideline (AAT guideline) but with an important omission: the AAT guideline expressly anticipates and addresses how parties to proceedings should prepare their experts (see AAT guideline at sections 1.3 and 1.7). The ADC expert guideline would be better for including that omitted part of the AAT guideline.
Kinsman Legal's involvement with briefing experts and deploying expert evidence in trade remedies and other matters
Kinsman Legal assisted with obtaining and deploying expert evidence in matters mentioned in this article (the power transformer and kraft paperboard investigations) and before other agencies, tribunals and courts. Kinsman Legal can advise and assist parties to investigations, inquiries and litigation in respect of expert evidence.
Edit: minor clarifications
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