IMPORTERS URGE DELIVERY

Southland Times, Issue 23828, 27 May 1939, Page 8

IMPORTERS URGE DELIVERY

RELEASE OF GOODS WANTED SEVERE CRITICISM IN AUCKLAND “PLACING POLICY ABOVE RULE OF LAW” (United Press Association) AUCKLAND, May 26. Strong resolutions addressed to the Government were passed today by 150 importers at a special meeting convened by the Bureau of Importers. The president (Mr W. A. Boucher) said it had been stated in sundry quarters that the victory arising from the Supreme Court judgment was a rather hollow one, but he did not think it should be so considered. More would be heard of it and eventually it would be regarded as the beginning of the return of the rights of importers. The success achieved must, however, be followed up. Hundreds of men in business had been ruined during the existence of the regulations, and thousands had lost their employment or were on the point of losing it. Mr Boucher said legal opinion indicated that any attempt to hold goods back in future was illegal. If the value of the goods lying on the wharves exceeded £3OO action to recover them must be taken through the Supreme Court, and probably it would be August before the case could be heard. If the goods were valued at less than £3OO action could be taken through the Magistrate’s Court. Importers who wished to have goods released should make the demand by letter to the Collector of Customs with notice that legal action would be taken if the goods were not delivered. He said many congratulatory telegrams had been received by Mr Gainor Jackson on the success of the Supreme Court action and by the Bureau of Importers. Mr Jackson was greeted with cheers and a storm of applause when he rose to speak. He said he would not comment in detail on the judgment. The learned judge had found the regulations were not valid and never had been valid. Mr Jackson claimed also that the restrictions against the export of funds to pay for imports should be removed.

Mr j. Hislop said he wanted to clear importers from the charge that they had been in any way responsible for the serious financial crisis which undoubtedly was facing the country. “We are not going to put our rights and liberties in pawn to get the Government out of that,” he said, adding that the responsibility for the shortage of the Dominion’s sterling funds rested entirely with the Government. Importers greeted the Prime Minister’s suggestion that they should offer the Government an alternative scheme and the Bureau of Importers could furnish a scheme that would achieve all that the Government had set out to achieve. He moved the following resolution: That this meeting desires to protest most emphatically against the action of the Government in insisting upon administration of import regulations which have been declared by the Supreme Court to be illegal. By such action the Government is placing State policy above the rule of law and is making the will of . the executive superior to the administration of justice. This meeting further protests against the _ threat of the Government to use its parliamentary majority to enforce a policy which has never received a mandate from the electors and it is a matter for grave public concern that such a threat will be given retrospective

operation. The resolution was carried unanimously. Another resolution moved by Mr Boucher was carried unanimously calling upon the Government to instruct the Customs officials to release goods now held pending the production of import licences. The meeting passed ■ a resolution thanking the Collector of Customs and his officers for the assistance and courtesy they had extended to importers. “BLACK MARKET” Free Exchange Funds In London IMPORTERS INTERESTED Fairly extensive dealings in free exchange, namely, in external funds that for various reasons are not subject to the Government’s control of exchange through the Reserve Bank, are disclosed by inquiries made in commercial circles in Wellington by The Evening Post. The interest of importers in this means of obtaining credits abroad to enable goods to be purchased for New Zealand without making a call on controlled London funds has been greatly stimulated by the announcement by the Minister of Customs (the Hon. W. Nash) that application for import licences by importers who could import goods without calling on sterling would receive favourable consideration, and now by the recent judgment on the import regulations, as delivered in Auckland. The accelerated demand for these free funds is indicated by a steady increase in the premiums charged One transaction involving the purchase of £40,000 of London money in January at a premium of 2| per cent, is mentioned as one of the earliest dealings in this so-called “black market’’; but since then the premium has risen sharply, and another transaction involving £lO,OOO at a premium of 10J per cent is said to have taken place this week. This means that the importer has agreed to pay in New Zealand currency this high premium together with the exchange, or £135/10/for every £lOO worth of London money purchased. Other transactions reported have been at £l3O to £132, equal £lOO in London.

The free exchange to supply this outside market has been made available from a number of sources, one of the principal of which is believed to be the private sale of exported produce abroad before December 5 when exchange control became operative. Other free money has come into existence from interest on foreign investments,

bequests under wills, and through the willingness of New Zealanders who have funds abroad to sell the title to them in New Zealand. The premium charged is partly a result of the strong competition for the limited credits available and partly the desire of sellers to receive some compensation for the added risk they may feel they incur by transferring their money to the Dominion, where it will become subject to Government control. It will be obvious that New Zealand residents who regularly receive funds from abroad in the form of interest on investments or annuities have every inducement to operate through this outside market which increases their remittances in terms of New Zealand currency by the amount of the premium charged. Proceeds from produce held in London up to December 5 must in time be exhausted and now be running low. Another and more simple method of obtaining free external credits is the purchase of Australian shares from New Zealand holders and then to have them disposed of on the Australian market. The New Zealand money to pay for those stocks was, of course, sent out of the country when the stock was originally purchased, in most cases long before exchange control was contemplated. That considerable dealings of this nature have been taking place is indicated by the higher price of some well-known Australian shares on the New Zealand stock market compared with their current prices in Australia.

The greater part of these dealings in free exchange is said to have taken place between merchants or as between the importers and representatives of owners of free credits abroad. Apart from dealings in Australian shares the New Zealand Stock Exchange has not been affected by such transactions.