The World Trade Organisation's (WTO) Dispute Settlement Body has started its investigation into New Zealand's ongoing battle with Australia over its tough rules on apple imports. This is the first time New Zealand and Australia have had a dispute heard by the WTO.

New Zealand applied to have the dispute heard by the WTO in December of last year, saying Australia's rules on apple imports, which date from 1921, are not scientifically justified and break global trading rules. However the application to appear in front of a WTO panel was rejected by Australia who said talks between the two countries were the best way to settle the dispute. But under WTO rules Australia cannot block a second request, which New Zealand has now put on the agenda of the organisation's Dispute Settlement Body meeting for January 21.

The WTO document shows New Zealand is challenging a decision in March of 2006 which keeps strict controls on imports of New Zealand apples under Australia's 1908 Quarantine Act and further measures introduced in November 2006. Although the March decision lifted a ban on imports of New Zealand apples imposed in 1921 to prevent the spread of a disease called fire blight, New Zealand apple exporters argue that the restrictions it left in place are excessive. Japan, the United States, Chile, the European Union and Taiwan have all signed on as third-party observers to the case.