Ministers follow OIO law

Land Information Minister Maurice Williamson and Associate Finance Minister Jonathan Coleman have approved the new recommendation of the Overseas Investment Office (OIO) to grant consent to Milk New Zealand Holding Limited to acquire the 16 Crafar farms.

“New Zealand has a transparent set of laws and regulations around overseas investment,” Mr Williamson says.

“Those rules recognise the benefits that appropriate overseas investment can bring, while providing a range of safeguards to protect New Zealanders’ interests. They are applied evenly to all applications, regardless of where they are from.

“We have sought to apply the law in accordance with the provisions of the Overseas Investment Act and the guidance of the High Court.

“We have carefully considered the OIO’s new recommendation. The OIO sought advice from Crown Law and independent legal advice from David Goddard QC. The Ministers also sought advice and clarification from Mr Goddard.

“We are satisfied that on even the most conservative approach this application meets the criteria set out in the Act and is consistent with the High Court’s judgment.”

The Ministers have followed the law, and the High Court’s stricter definition of it, as they are bound to do.

Opponents of land sale to foreigners won’t like it but the correct way to deal with that is to change the law, not to go against it.

Former Minister Chris Carter tried that with the Whangamata marina, was taken to court and lost.

Dr Coleman said the consent came with stringent conditions.

“These 27 conditions have been imposed to ensure Milk New Zealand’s investment delivers substantial and identifiable benefits to New Zealand,” Dr Coleman says.

The conditions require Milk New Zealand to invest $16 million into the farms and to protect and enhance heritage sites.

“The combined effect of the benefits being delivered to New Zealand as a result of this transaction is substantial.”

The land is already in foreign hands – that of the banks and the receivers are bound to get the best price for it.

I’m not convinced they went about that the best way – the farms were offered for sale individually or as a package but I don’t know if they actively tried to market them to locals.

Whether or not they did, the best offer on the table now is the one approved today.

If the land was sold to New Zealanders they would not be required to do anything with it at all, they would not have 27 conditions imposed on them nor be required to make any further investment as the purchasers, Shanghai Pengxin, are.

A copy of the OIO’s new recommendation is here.

A copy of the OIO’s decision summary is here.

11 Responses to Ministers follow OIO law

  1. inventory2 says:

    Interesting to note that the legislation that the two responsible Ministers will have followed is the Overseas Investment Act 2005. Yes; LABOUR disestablished the Overseas Investment Commission and replaced it with the OIO. It makes Labour’s opposition to the sale of land to foreigners now seem rather odd.

    And in view of the intense political and judicial scrutiny that this decision has already attracted, you can bet that Messrs Coleman and Williamson will have done everything completely by the book. But now there are howls of outrage because the Ministers DID indeed follow the law!

    Like

  2. robertguyton says:

    National and his apologists cite ‘by the book’ when it suits them, but look the other way and change the legislation when they find themselves blocked by ‘pesky’ laws.
    Selling chunks of New Zealand – just plain stupid.

    Like

  3. JC says:

    “Selling chunks of New Zealand – just plain stupid.”

    But something the Greens were quite happy to live with as Labour sold 600,000ha to foreigners over nine years.

    It only became a problem when the Chinese became a player.. hence Russel Norman is proposing legislation for a “White NZ” policy.

    Of course “Aussie Russel” isn’t going to call it that, but strangely the Crafer Farms is going to feature strongly in the buildup to the prposed legislation.

    Meantime, lets enjoy uber leftist Workers Party John Moore’s giving the long lefty history of racism against Chinese in NZ and its modern equivalent.

    http://liberation.typepad.com/liberation/2012/02/guest-blog-post-john-moore-leftwing-xenophobia-in-new-zealand.html

    JC

    Like

  4. jabba says:

    I love polls .. recent polls say that the public are against land sales to those awful foreigners (espec Chinese) and the Sky City pokkie/convention center thing .. people like our bOb love producing those results and fair enough, I guess. Now, a Roy Morgan poll comes out and shows an increased support for the Nats and drops for Labour and the dead loss Greens .. what say you Booby?

    Like

  5. robertguyton says:

    I was feeling quite challenged by your argument, jabba, trying to think of ways to explain this point and that, considering agreeing with you on a couple of things, perhaps a little praise to go the way of your favourite party. Then I got to the final sentence, where you descend to using an insulting word instead of my name and I realised I didn’t have to do any of the things I had been considering, as I was engaged in ‘discussion’ with a person who can’t debate at an adult level, so I stopped.

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  6. Paul Walker says:

    I still find myself asking, What is the economic case against foreign ownership? I don’t see a problem, in fact it seems to me that foreign ownership is a plus if only because it increases the set of potential buyers. So what is wrong with foreign ownership?

    Like

  7. robertguyton says:

    I still find myself explaining to you, that it’s not about economics it’s about sovereignty.
    So what’s wrong with foreign ownership?
    Loss of sovereignty.

    Like

  8. jabba says:

    sorry bOb, I put in an extra o instead of a b .. I was in a hurry.
    So, you would support a Govt buy back of all land owned by foreigners or do a bobby Mugabe and chase them off and or kill them?
    Or, like with your thoughts and mining and oil exporation, keep the status quo and stop ALL sales of land, and maybe companies from now on

    Like

  9. homepaddock says:

    JC – Fascinating reading. I found it a couple of days ago and a post on it is under construction.

    Paul – I’m with you and I don’t see how selling farmland threatens our sovereignty when selling urban land and any businesses doesn’t.

    Like

  10. JC says:

    Utter crap. Sovereignty is determined in international law as one country exercising control over a people and/or territory in accordance with it’s and international law.
    The fact is that NZ could sell 80% of its land to foreigners and it would make no difference to its sovereignty provided it retains its laws and authority over territory and people.

    Another fact is NZ has close to the most restrictive foreign ownership policies in the free world, in fact the more the restrictions, the more likely you are dealing with a dictatorship; and even here the World Bank shows a more enlightened attitude to FDI in land:

    “Relative to other regions, countries in the Middle East and North Africa are fairly restrictive on foreign equity ownership in many sectors. An
    exception is Tunisia, which has no limits on foreign ownership of firms in nearly all sectors measured by IAB. In several countries in the region,
    extractive industries (mining, oil, and gas) are much less open to foreign capital participation than in other regions, as are electricity and
    transportation. Morocco, Tunisia, and the Republic of Yemen restrict foreign equity ownership in electricity transmission and distribution. Equity
    restrictions also exist in port and airport operations. *On the other hand, no country in the region imposes limits on foreign participation in
    agriculture and forestry.”*

    JC

    Like

  11. Paul Walker says:

    “I still find myself explaining to you, that it’s not about economics it’s about sovereignty.”

    Ownership of productive assets is clearly an economic assets and if there are no economic issues with farm ownership then I don’t see what issues there can be.

    What exactly is a loss of sovereignty? The NZ government can always change any law in NZ, including those to do with asset ownership.. It could, for example, nationalise any foreign holding of land, or any other asset. Also why is there a problem with foreign ownership of land but not with other productive assets? In addition if foreigners can not own assets in NZ should we stop NZers owning assets overseas?

    Like

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