The National Party is denying allegations then-Cabinet minister Todd McClay helped facilitate a donation of $150,000 to the party in 2016 from a company owned by a Chinese billionaire.
Todd McClay Photo: RNZ / Rebekah Parsons-King
The allegations have been made by former National MP Jami-Lee Ross, who provided documents to the New Zealand Herald, including an invoice showing the donation was paid into the party's Rotorua electorate bank account, and details of a cluster of calls to and from Mr McClay around correspondence with the donor.
Mr McClay said he met the donor, Lang Lin, in July 2016 when he travelled to China as Trade Minister.
He said ministry officials were with him at both meetings and there was no discussion of a political donation.
Mr McClay later met Mr Lang in his Rotorua electorate where he indicated that his New Zealand business, Inner Mongolia Rider Horse Industry NZ Limited, would like to support the National Party.
"My understanding is that it's a New Zealand company that made the donation, that it is within the rules - both of the Electoral Act and New Zealand law,'' he said.
Mr McClay said he was present when a phone call was made between Mr Ross and Mr Lang to organise the donation.
He said at the time he was there as a National MP - not as a minister or the MP for Rotorua.
Electoral law does not allow foreign donations above $1500, but New Zealand-registered companies are considered local even if they're foreign-owned.
Prime Minister Jacinda Ardern said the donation is outside the spirit of the law.
"We have a law in place that's meant to prevent that yet we have an example here of where something lawful might have happened but it's outside of the spirit of what we're trying to achieve,'' she said.
Ms Ardern wants the Justice Select Committee to look at whether there's a loophole when foreigners use New Zealand companies to make donations.
National Party leader Simon Bridges said the party and its MP have not broken any rules by accepting the donation.
Mr Bridges said Mr McClay was not seeking donations while he was a government minister.
He said the donation was "old news".
"This was disclosed a couple of years ago. It was all there for anyone to see, in fact there have been questions about it in the past, but there was no conflict and it is a New Zealand company legally."
Mr Bridges said he has never met Mr Lang, the man behind the donation.