The move to take Australia to the WTO disputes panel in Geneva in October follows last-ditch discussions held yesterday in Canberra between Thai officials and the Australian regulator Biosecurity Australia (BA).
A spokesman for BA confirmed the meeting. "We explained the new measures," he said. By the end of September all raw prawn imports will be banned and additional environmental safety tests will be required for prawn cutlets and prawn meat. According to Thai officials, the requirements are unnecessary, onerous and scientifically unsound.
Bangkok-based shrimp biologist Tim Flegel, with Mahidol University, accompanied the three Thai officials to the meeting. He said it was "very likely" that Australia would lose the case, especially as the WTO's World Animal Health Organisation (OIE) was revising its guidelines on transferable diseases to specifically exclude prawns sold for human consumption from the so-called "disease-risk pathway".
A member of the Thai delegation told The Australian that the Association of Southeast Asian Nations group was likely to seek compensation for losses.
If Australia loses the dispute, it may face compensation payments of $500 million for every year the restrictions last, according to an estimate by Harry Peters, president of the Seafood Importers Association of Australia, an industry body whose 40 members handle about 80 per cent of seafood imports.
"This won't be the first WTO challenge Australia has lost in regard to seafood imports," Mr Peters said, pointing to the 1999-2000 salmon war between Australia and Canada.
In that case, the Tasmanian salmon industry pushed the state to unilaterally ban imported Canadian salmon on the grounds that it posed a risk of disease to local fish. Two shires in Victoria and one in NSW also threatened bans on Canadian fish because of fears that disease would strike local trout.
After the WTO found that Australia had breached its free trade obligations, Canada threatened to retaliate against $53million worth of Australian products. Canberra was forced to intervene.
A spokesman for Trade Minister Warren Truss said the Government would robustly defend any action brought against Australia by the prawn exporters.
"Every decision we make is science-based and WTO-compliant," he said.
Source: The Australian