New Zealand tightens rules on foreign investment

Source:AFP Published: 2019/11/19 21:08:41

Arrowtown in New Zealand Photo: IC

Foreign investors hoping to buy New Zealand's strategic ­assets will now have to convince the government it is in the national interest, officials said ­Tuesday.

New rules will for the first time give the government power to reject overseas investments in sensitive areas if it decides they could be detrimental to the country, Associate Finance Minister David Parker said.

He said the test would apply to crucial infrastructure including ports and airports, telecommunication and electricity networks, as well as firms developing military technology or supplying intelligence agencies.

"These powers will be used rarely and only where necessary for protecting New Zealand," Parker said, citing investments that could "pose a significant risk to our national security or public ­order."

He said the new government power could also be used to veto foreign investments in media firms if they were a threat to democracy.

Previously, foreign investments have been screened on the basis of the buyer's character and financial capability to complete a proposed transaction. 

However, intelligence agencies can already vet some infrastructure projects on the basis of national security.

The Government Communications Security Bureau did this last year when it barred ­local telecoms firm Spark from using Chinese giant Huawei's equipment in its planned 5G network.

"The reforms will apply to all overseas investors, ­irrespective of where they are from," he said.


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