Chamber Welcomes Review Outcome
1 October 2008
Chamber Welcomes Review Outcome of Overseas Investment Regulations
The next government should take account of the Regulations Review Committee’s recommendation that in future Cabinet consult with relevant parties before ammending overseas investment applications.
The recommendations were in response to a joint complaint made by the Wellington Regional Chamber of Commerce and the New Zealand Business Roundtable to the committee about the process Cabinet took to amend the Overseas Investment Regulations half way through the Canadian Pension Plan’s offer to shareholders in Auckland International Airport.
Cabinet made changes to the criteria Ministers have to consider when approving or declining overseas investment applications
“The Chamber was very critical of the government changing the rules half way through the offer and was concerned about the signal it sent that the government is anti-foreign investment,” said Chamber CEO Charles Finny.
“We remain concerned about the consistency of this action with our international legal obligations.
“The changes to the regulations were in our view so significant that they should have been made through legislative change, not regulation. This would have allowed full scrutiny by select committee and submissions from outside interests
The Committee has upheld our complaint. Its key conclusion is as follows:
"In our view the Overseas Investment Regulations 2008 constitute an unusual and unexpected use of the regulation-making power. The regulations also contain matters that can be argued to be more appropriate for parliamentary enactment."
“The Committee recommends that the government reviews the regulations, amends the primary legislation, and does not allow future regulations to be made adding factors or criteria to those in primary legislation.
“This is a satisfactory outcome and the next government must act on this recommendation,” Mr Finny concluded.