8 Sep 2015

Govt to review overseas investment process

3:19 pm on 8 September 2015

The Government is looking at ways to speed up the Overseas Investment Office (OIO) process after a number of complaints from applicants, the Finance Minister says.

Bill English during caucus run 23/06/2015

Finance Minister Bill English Photo: RNZ / Alexander Robertson

Bill English made the comment while responding to questions about a possible foreign investment in Silver Fern Farms, New Zealand's largest meat company.

Silver Fern Farms has been seeking $100 million in new funding to help reduce its debt.

It has been refusing to comment on the prospect of foreign investors, possibly from China, seeking to buy a 50 percent stake.

Mr English said whatever happened was totally up to the farmer-shareholders.

'If the New Zealand shareholders want to maintain 100 percent ownership of that company then they need to put up their money to secure that ownership."

But more generally, he said, the Government was looking at whether it takes too long for the OIO to consider applications.

"We get feedback from people who use it and it takes a bit long, now the hurdles are pretty high, now some of that is intentional, the Overseas Investment Act is there to test the propositions.

"For people coming buying land, particularly, there are 23 tests that have to be met legally, recent court decisions, over the Crafar farms, have raised the bar.

"So we can't and we're not going to reduce those hurdles, but there are some issues about whether the processes take too long."

He said the process could only be sped up with more staff and more money, and he was considering the options.

Labour Party Leader, Andrew Little.

Labour leader Andrew Little Photo: RNZ / Alexander Robertson

Labour leader Andrew Little said the problem with the OIO was not how fast it was processing applications, it was how it was doing its job.

"If the OIO puts conditions on applications for investors then we expect those to be followed up and monitored to make sure that conditions they put on it, and the promises that are made by potential investors, are actually being met."

Mr Little said there was a risk the OIO provisions could be watered down.

"The type of controls and and checks and balances New Zealanders expect us to have to preserve and protect interests and industries."

Mr Little said government ministers would also have the power to prevent a 50 percent foreign shareholding, if it came to that.

He said there was a broader issue of providing capital to New Zealand companies.

"And the question is whether it is blowing air up a horse's backside by just continuing to find new debt to sustain companies and an industry that is struggling to make itself viable in the long-term."

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