Final Crafar hurdle defeated
October 18th, 2012 at 10:00 am by David FarrarThe Herald reports:
Chinese company Shanghai Pengxin’s bid to buy the Crafar dairy farms passed its final legal hurdle today after an attempt to block the deal in the Supreme Court was dismissed.
King Country iwi Ngati Rereahu last month initiated a Supreme Court challenge against the approval for the purchase of the sixteen farms granted by the Overseas Investment Office, associate Finance Minister Jonathan Coleman and Land Information Minister Maurice Williamson.
However the court refused to hear the case saying the claim relied on an examination of the Overseas Investment Act’s provisions around the buyers’ required business acumen and experience.
The ministers’ decision to approve the deal the involved “matters of fact and degree rather than the true meaning of the statute” the judges who considered the application said in their decision.
In other words, you can’t appeal just because you didn’t like the decision as you were trying to pick the farms up cheap.
I hope the partnership between Landcorp and Shanghai Pengxin leads to more opportunities for Landcorp to expand.
I’m also glad it has sent a signal out that investment decisions will be based on the law and the national interest test in the law – not on xenophobic scaremongering.
Related posts:
- Fay loses on Crafar farms at Court of Appeal
- Crafar sale approved
- Crafar deal ordered to reconsideration
- Dom Post on Crafar
October 18th, 2012 at 10:10 am
The “New Zealand Initiative ” (Business Round Table/ NZ institute combined under the leadership of agw denying Dr Oliver Marc) is railing against NZ’s restrictive business environment when it involves foriegn direct investment. Land is something the single out.
Vote:http://www.nzinitiative.org.nz/fdirestrictiveness.html
October 18th, 2012 at 10:14 am
A Quote from the sponsors (i.e the organisation headed by AGW denier Dr Oliver Hartwich)
“All New Zealanders can be expected to bear the cost of these foreign investment barriers through lower property
values, a higher cost of capital, and weaker economic growth.”
http://www.nzinitiative.org.nz/fdirestrictiveness.html
lower property values is a cross the public will not have to bear under the National NZ For Sale Party.
Vote:October 18th, 2012 at 10:23 am
Globalisation is a move towards one world economy where national bounderies are ignored. It would be fine in a world where each nation had similar ratios of people to resources. The truth, however, is that populations increase exponentially and over population is a reality. The directors of this property development company have managed to capture a good chunk of China’s resources in land, buoyed by an enormous pool of cheap labour. NZ is now their farm. National is their bitch.
Vote:http://www.uvm.edu/~jdericks/EEtheory/Daly_on_Globalization.pdf
October 18th, 2012 at 10:28 am
“I hope the partnership between Landcorp and Shanghai Pengxin leads to more opportunities for Landcorp to expand.”
Really? You think the expansion of a state owned farmer is a good thing? National really has stood only for nationalisation so far this term.
Vote:October 18th, 2012 at 10:29 am
No doubt the iwi was looking for some koha to smooth things over.
DPF, why would you want “Landcorp to expand”? Is statism a new hobby of yours?
Vote:October 18th, 2012 at 10:30 am
@ manolo they wanted 2 of the farms sold to them for a price somewhat less than Pengxin were paying.
Vote:October 18th, 2012 at 10:36 am
I agree with Kiwi Greg, Landcorp should be divesting themselves of land not becoming as leviathan collective.
Vote:October 18th, 2012 at 10:38 am
Yeah, that’s why countries like Singapore and Hong Kong who have no natural resources at all are doing so badly.
Vote:Countries should play to their strengths.
October 18th, 2012 at 10:40 am
Yes hj, greg and others nailed it. The only reason that New Zealand farmers cant afford to buy farms is because our land is an export commodity.
But I guess we’re still a free country – we have the choice of who screws us – Foreign investors, Iwi or the Government. We could call it “Hobson’s Choice”.
Vote:October 18th, 2012 at 11:07 am
@ kevin plenty of New Zealand farmers CAN afford to buy farms and plenty do. In this particular case the highest bidder was foreign (but then so was the effective owner – Ozzy banks).
Vote:October 18th, 2012 at 11:12 am
Kevin – the land isn’t getting exported. It’s staying right where it always has been.
Vote:October 18th, 2012 at 11:25 am
@ gazzmaniac and ironically NZers access to the land typically goes up when sold to foreigners (it’s private property after all). Look at the conditions associated with recent OIO rulings.
Vote:October 18th, 2012 at 12:35 pm
I can’t believe a National party blogger is calling for the expansion of the Govt owned landcorp at the expense of the private business sharemilkers who currently run some of the farms. I have long given up on seeing a return of the principles that founded the National Party, now I know all hope is lost. The Govt through Landcorp is now competing in the sharemilking business. What is more it is not a fair contest with National Govt Ministers making it a conditition of the sale that the Chinese must use the Govt owned Landcorp to run the farm. I believe this to be corrupt at most, anticompetitive at least. Either way it is a blow to business and enterprise in NZ and it stinks. Sharemilkers who run their own businesses will lose their business thanks to this Govt’s anti business and anticompetitive requirement to force the Chinese to use Landcorp.
Vote:As for Landcorp itself, I can’t think of a single reason for it to exist. It has assets of $1.6billion and made a profit last year of 1%. All its farms would be better run in private hands and the taxpayer would be better off if it was sold.
October 18th, 2012 at 12:40 pm
I may be optimistic but looking at this Supreme Court decision and other goings on are we not seeing a swing of the pendulum against Maori greed. Every day now there are more strident demands (kohanga Reo today, water yesterday) for preferential treatment and payouts; perhaps the increase in noise is a response to a growing resistance to the demands. Like most things it is all a game; up until now Governments have been infused with guilt and vulnerable to intimidation; the water demands may be a game changer. Certainly the Iwi leaders forum were not happy with the maori council initiative in going to the Waitangi tribunal, preferring instead to make back room deals with soft touches in Government (Finlayson in particular). Now that the play for water is in the open the Government has been forced to grow a pair. The offer of power shares to Iwi sends a rather transparent message that maori are not special; they can line up with other investors on equal terms and participate in the share float. I just hope that there is not another soft deal in the offing (shares for free).
Vote:October 18th, 2012 at 1:19 pm
gazzmaniac (1,314) Says:
Yeah, that’s why countries like Singapore and Hong Kong who have no natural resources at all are doing so badly.
Vote:Countries should play to their strengths.
…………………………..
Singapore and HK have geography on their side.
October 18th, 2012 at 1:19 pm
@rg you nailed it!
Vote:October 18th, 2012 at 1:28 pm
Well said, rg.
Today’s National Party moral compass has been pointing West (left) for the past two decades. Labour lite has bugger all chances of changing course with its current “leadership”.
Just look at Neville Key and weep.
Vote:October 18th, 2012 at 1:33 pm
The myth embedded here is all boats rise when we have foreign direct investment (in this case in land). In fact the vendors boat rises and those who own comparable properties.
Vote:October 18th, 2012 at 3:04 pm
So if you question NZ freehold land buying by a Communist State that doesn’t allow foreigners to buy land, you are “xenophobic scaremongering”?
Not only does China bar foreigners from owning its land, foreigners are unable to get a signficant stake in the Chinese steel industry, the Chinese equivalent as a leading industry to dairying in NZ. By DPF’s logic that means the Chinese are being xenophobic towards NZ. In fact 95 per cent of them have never heard of New Zealand.
The real beneficiaries of the Chinese buying of the farms are the real estate agents, the PR’s on a fat ticket from Beijing, and journalists shouted “junket” tours to China.
Dreamers who think New Zealand will prosper by supplying food to China should read Der Spiegel (English language version). Click on link below. The article will help NZ supermarket shoppers enjoy their Chinese garlic, too.
Some quotes:
and
The link:
http://www.spiegel.de/international/world/europe-worries-about-health-hazards-of-cheap-food-from-china-a-861406.html
Vote:October 18th, 2012 at 3:37 pm
hj – New Zealand also has geography on its side, with reasonable proximity to big markets (Asia) and a climate conducive to agriculture.
HK and Singapore both allow foreign investment and that’s amongst the reasons why they are consistently two of the best performing economies.
Vote:October 18th, 2012 at 3:53 pm
The Singapore Government, through sovereign funds such as Temasek, owns stakes in companies that contribute about two-thirds of Singapore’s GDP. It’s sort of socialist.
Singapore is closer to a beneficial dictatorship than it is to a free society. NZ could boom if it was prepared to sacrifice some democratic rights, and if we were led by people as bright as the Singoreans are (or were).
Our present Parliament would have fewer than 10 people smart enough to take the economic ship out of Sargasso sea we’re in.
Where else could we find the brains?
The Reserve Bank? After fiddling through the finance companies firestorm and playing dumb in the currency explosion? Not a chance
Vote:.
Treasury? Bill English is an example of their graduates, so, hmmm.
October 18th, 2012 at 3:56 pm
Doug Graham?
Vote:October 18th, 2012 at 4:08 pm
Doug Graham? Nice one, Kevin.
Sir Doug, outwitted by Ngai Tahu’s legal eagle, Chris Finlayson, into giving the blue-eyed iwi a sweetheart deal, and then the disaster of the Lombard finance company, of which he was a director.
Who else? Winston Peters? Catherine Delahunty?
To the Chinese, dealing with NZ must be like negotiating with a progressive school for the mentally retarded, run by the senior pupils.
Vote:October 18th, 2012 at 4:12 pm
Amnesia Keys?
Vote:October 18th, 2012 at 4:14 pm
Any relation to Yan Ki?
Vote:October 18th, 2012 at 4:27 pm
I do shudder when I think of one of our politicians in charge of a country of 1 billion people.
“Wharrever you doo, dont push the wed burron”
Key: “Sorry I’ve forgotten what colour red is”
Vote:October 18th, 2012 at 4:52 pm
I’d do it, but I couldn’t deal with parliamentary bullshit. I’d offend too may people before I ever got into a position of power.
Vote:I really do not like arse kissing.
October 18th, 2012 at 6:37 pm
gazzmaniac (1,322) Says:
hj – New Zealand also has geography on its side, with reasonable proximity to big markets (Asia) and a climate conducive to agriculture.
HK and Singapore both allow foreign investment and that’s amongst the reasons why they are consistently two of the best performing economies.
………..
HK and Singapore are at a trading nexus. HK capitalised on it’s large population. The point here is comparing apples with apples and the whole point about the Crafar Farm is that farming is a way of life for many New Zealanders and by limited selling to foreigners land is kept in the family (as it were).
The government likes to pretend that what it is doing is good economic policy and it is you take the position that we aren’t a national community but one world community, in which case the voters don’t matter and there is no social contract between the NZ citizen and it’s politicians..
Vote:October 18th, 2012 at 6:57 pm
Would you object if I was the purchaser of Crafers? I’m not a NZ resident (although I was born there and am a citizen) and have no intention of coming back. It’s still foreign investment since I am a foreign resident and nearly everything I own is derived from foreign sourced income. Or a more likely scenario, what about a rich expat/tax exile like Michael Fay or Owen Glenn?
What about a foreign person/corporate who is resident in NZ?
What about a corporate or businessman who is Australian, say James Packer?
What about a British person?
An American?
How is that any different to someone from China buying it?
Vote:October 18th, 2012 at 7:00 pm
OHMYGODTHEASIANSARECOMINGANDTAKINGOURJOBS
Vote:October 18th, 2012 at 7:18 pm
But I guess we’re still a free country – we have the choice of who screws us – Foreign investors, Iwi or the Government. We could call it “Hobson’s Choice”.
Well that’s how Hobson left things.
Vote:October 18th, 2012 at 7:31 pm
gazzmaniac (1,326) Says:
Vote:October 18th, 2012 at 7:00 pm
OHMYGODTHEASIANSARECOMINGANDTAKINGOURJOBS
………..
that’s happening in tourism where there are more Chinese driving tour buses than Kiwis.
October 18th, 2012 at 7:40 pm
gazzmaniac (1,326):
Your argument puts forward individual cases yet it is the cumulative effect that matters. Also you are trying to demonstrate that there are grey areas but that doesn’t preclude an (albeit) clumsy line. The point is governments work on behalf of the interests of the national community not the Omaha Beach crowd.
Vote:October 18th, 2012 at 7:56 pm
hj – nothing is stopping someone from becoming a bus driver if they want. There is a reason why there are chinese bus drivers and that is because kiwis demand too much money for what in reality is an unskilled job.
As for Hobson, if you believe the conspiracy then his final version of the Treaty of Waitangi was fine, we just haven’t adopted it in more “modern” law.
Vote:October 18th, 2012 at 8:41 pm
gazzmaniac (1,329) Says:
Vote:October 18th, 2012 at 7:56 pm
hj – nothing is stopping someone from becoming a bus driver if they want. There is a reason why there are chinese bus drivers and that is because kiwis demand too much money for what in reality is an unskilled job.
……..
and the world has a large pool of labour which the government allows in.
October 18th, 2012 at 9:02 pm
“I’m also glad it has sent a signal out that investment decisions will be based on the law and the national interest test in the law – not on xenophobic scaremongering.”
…………………………
someone remind me how it is in the national interest that Shanghai Pengxion purchase the Crafar Farm’s (and I don’t mean “Nationals interests”):
5 October 2009: Crafar Farms placed into receivership, owing $216 million to creditors.
2 December 2009: KIWI DAIRY CORPORATION LIMITED registered. (Then changes to ORAVIE LIMITED, 20 December 2010. Then changes to ORAVIDA LTD, 20 January 2011. Then changes to ORAVIDA NZ LIMITED, 13 May 2011. ) Shareholders: Jing Huang, Julia Jiyan Xu, and Deyi Shi. (Source)
11 June 2010: National Party receives $50,000.00 donation from Susan Chou. (Source)
30 July 2010: National Party receives $150,000 donation from Susan Chou. (Source)
18 November 2010: MILK NEW ZEALAND CORPORATION LIMITED* registered. Directors: Terry Lee and Jiang Zhaobai. (Source)
22 December 2010: Government blocks bid by Natural Dairy to buy the 16 Crafar farms on ‘good character’ grounds.
27 January 2011: KordaMentha accepts offer from Shanghai Pengxin International Group Ltd to buy Crafar Farms.
31 May 2011: National Party receives $100,000 donation from Susan Chou. (Source)
22 July 2011: ORAVIDA LTD registered. Shareholders: Jing Huang, Julia Jiyan Xu, and Deyi Shi. (Source)
27 July 2011: ORAVIDA PROPERTY LTD changes name to KIWI DAIRY INDUSTRY LTD. Shareholder: Deyi Shi (Source)
13 April 2011: Shanghai Pengxin lodges application with the Overseas Investment Office (OIO) to buy the Crafar farms.
26 September 2011: Crafar farms receiver KordaMentha rejects a conditional NZ$171.5 million offer for 16 central North Island dairy farms from a group led by controversial former merchant banker Michael Fay.
22 November 2011: National Party receives $50,0000 donation from Citi Financial Group. Shareholders: Yan Yang and Qiang Wei. (Source) (Source)
22 November 2011: National Party receives $1,600 from Oravida NZ. (Source) (Source)
26 November 2011: NZ General Election
30 November 2011: National Party receives further $55,000 donation from Oravida NZ. (Source) (Source)
27 January 2012: Government ministers approve Shanghai Pengxin’s application to purchase 16 Crafar farms.
15 February 2012: High Court delays sale of Crafar farms to Shanghai Pengxin.
20 April 2012: Government ministers , Land Information Minister Maurice Williamson and Associate Finance Minister Jonathan Coleman approve the Overseas’ Investment Office’s (OIO) new recommendation to allow the sale of the 16 Crafar farms to Shanghai Pengxin.
* “Milk New Zealand Holding Limited” is the official applicant and purchaser of the 16 Crafar farms. It is supposedly a subsidiary of Shanghai Pengxin,
“ Applicant
3. The Applicant is Milk New Zealand Holding Limited (“the Applicant”), a Hong Kong incorporated company which is an overseas person under the Act.
4. The Applicant will register as an overseas company under the New Zealand Companies Act 1993 prior to acquiring the Investment. The Applicant does not have any current interests in New Zealand as at the date of this Application.1
1 The 99% ultimate owner of the Applicant, Zhaobai Jiang, has a [redacted]% interest in a company ([redacted*])that has applied for consent to acquire development land at [redacted] . No decision has yet been made on this application.” – Source
(*Note: Despite OIO redacting the second company, this blogger has found that it is actually “NATURE PURE LIMITED“. Terry Lee and Zhaobai Jiang are both listed as Directors.)
Despite numerous company name changes; newly registered companies; and a lengthy trail of shareholders, the one link that does stand out between Shanghai Pengxin and financial donations to the National Party is Terry Lee.
Mr Lee, along with Deyi Shi and Xing Hong, registered KIWI DAIRY CORPORATION LIMITED on 2 December 2009, which, after several name changes, ended up as ORAVIDA NZ LIMITED on 13 May 2011. Xing Hong was also a one time Director of ORAVIDA NZ LIMITED and ORAVIDA PROPERTY LIMITED.
Deyi Shi is still a current Director of both ORAVIDA NZ LIMITED and ORAVIDA PROPERTY LIMITED.
On 22 and 30 November, 2011, the National Government received donations totalling $56,600 from Oravida NZ Ltd.
A further $300,000 was donated to National by Auckland businesswoman, Susan Chou, who, through her husband Zhaowu Shen, had a connection with Jack Chen and NZ Natural Dairy Ltd – the first unsuccessful attempt by Chinese investors to gain control of the Crafar farms.
Two months later, on 27 January 2012, National approved the sale of 16 Crafar farms to Shanghai Pengxin subsidiary, Milk New Zealand Holding Limited.
Readers are invited to draw their own conclusions from the facts presented.
.
*
Vote:.
http://fmacskasy.wordpress.com/tag/oio/
October 18th, 2012 at 10:08 pm
A chinese lady whose husband knows somebody who is doing a business deal gives a political party some money.
Wow.
Vote:October 19th, 2012 at 6:46 am
I know it’s bit late but. . .
Based upon the Zimbabwe experience, I would suggest that it is unlikely that there will be much real co-operation / contact between the Chinese owners and New Zealand’s Landcorp. The new owners will bring in their own staff from teh homeland and these will have very little contact with the locals and will be effectively ‘corralled’. Local iwi will probably be placated by koha of a generous amount and frequency, but the farms will effectively become self-contained ‘little China’s’. The Chinese are here to learn and profit from our stupidity. Co-operation? yes, but only on Chinese terms and for as long as they see that they can gain. Once they know it all (which won’t take long), all bets will be off. We are now part of the empire folks – get used to it.
Vote:October 19th, 2012 at 9:08 am
hj – nothing is stopping someone from becoming a bus driver if they want. There is a reason why there are chinese bus drivers and that is because kiwis demand too much money for what in reality is an unskilled job.
…………………………..
So they gained their work permits under the “needed unskilled” category? Or perhaps the “shenanigans” categoury?
Vote:October 19th, 2012 at 9:18 am
A chinese lady whose husband knows somebody who is doing a business deal gives a political party some money.
Wow.
…………..
admittedly correlation isn’t the same as causality. I say we give them the benefit of the doubt: don’t want to be called “xenophobes”….. by the self interested rentier class and their lackies (the revolving door- the Jenny Shipley’s,…. )…..
[Revolving door (politics)
Vote:From Wikipedia, the free encyclopedia
In politics, the "revolving door" is the movement of personnel between roles as legislators and regulators and the industries affected by the legislation and regulation]
October 19th, 2012 at 10:42 am
10:05 Hugh Fletcher – a look back over his business career
http://www.radionz.co.nz/national/programmes/ninetonoon
“the only foreign investment we should be allowing is investment in new productive capacity”.
Vote: