The federal government says it accepts a World Trade Organisation decision overturning restrictions on New Zealand apples and says it will now undertake a full import risk assessment.
Agriculture Minister Joe Ludwig and Trade Minister Craig Emerson said Australia depended on exports and had no choice but to accept the decision of the independent umpire.
This follows a longrunning dispute over Australian imports of New Zealand apples.
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"The government has accepted the decision and will now proceed with a science-based review of the import risk analysis for New Zealand apples. The review will be conducted by Biosecurity Australia," they said in a statement.
Australia has long imposed restrictions on New Zealand apples, first imposing a ban in the early 1920s over an outbreak of fireblight, a disease affecting fruit trees.
Canberra lifted the outright ban in 2006 but imposed strict conditions which New Zealand said it made its exports uneconomic.
It complained to the WTO in 2007.
In its decision, the WTO ordered Australia to ease the restrictions.
"The appellate body upheld the panel's findings that ... Australia's measures regarding fireblight and apple leafcurling midge, as well as the general measures, are inconsistent," the WTO's appeal body said in a statement.
The WTO backed most of New Zealand's claims that Australian quarantine measures breached WTO rules.
Under WTO plant and human health rules, any restrictions on trade must be based on a proper assessment of the risks using internationally recognised methods, as well as "relevant" scientific evidence.
New Zealand growers estimate exports to Australia could be worth $A37.4 million a year.
Senator Ludwig and Dr Emerson defended the integrity of Australia's quarantine regime.
They said the review will ensure Australia remains appropriately protected from pests and diseases.
"With our strong belief in the benefits of liberal trade, the Gillard government will accept the independent umpire's decision of the WTO," Dr Emerson said.
"As a country dependent on exports, we cannot turn our backs on the WTO rules that support our nation's prosperity and that we used to gain access to other countries' markets."
Senator Ludwig said the review would be based on the best available science and the apple industry and other stakeholders would be properly consulted.
"The Australian apple industry will be given an opportunity to present its views on this matter," he said.
"Just as for any other product, no trade in New Zealand apples can occur until quarantine measures that appropriately protect Australia and our agricultural producers have been determined. That will occur following the completion of the review."
