Committee recommends dairy bill be passed into law
Updated at 7:26 pm on 7 June 2012
Parliament's Primary Production Committee is recommending a bill that would allow Fonterra dairy farmers to trade shares be passed into law.
The Dairy Industry Restructuring Amendment Bill will oversee how Fonterra sets the price it pays farmers and require public disclosure of information on its milk price setting.
The bill also includes changes that will allow Fonterra to introduce share trading amongst its farmer shareholders.
The committee recommends the legislation be passed into law, however with several amendments.
Those include preventing Fonterra from purposely manipulating trading among farmers share and fund markets.
It says that would safeguard farmers' freedom to enter and exit Fonterra, and maintain the contestability of the farm gate milk price.
The select committee reported back to Parliament two days earlier than it said it would, after a shortened committee process.
But Opposition parties say the proposed law changes will not be sufficient to protect the industry.
Labour MP, Damien O'Connor, says the committee did not have enough time to properly consider the very complicated bill.
Green Party MP, Steffan Browning, says some of the risks of allowing farmers to sell the dividend rights to some of their shares to outside investors, also weren't explored enough.
But the committee chair, and National MP, Shane Ardern, says three substantial changes have been made to the legislation to safeguard farmers and Fonterra.
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