In June 2016 Land Information NZ released the independent review of the Overseas Investment Office’s “good character” process that the Government had ordered in the wake of the OIO’s 2014 approval of the sale of Onetai Station to buyers who figure in the Panama Papers (and who were later revealed to have been guilty of environmental pollution charges in Argentina). Once again the people in question were deemed to be of good character by the OIO, despite evidence to the contrary.

And the review caught the OIO out, stating that its’ search of the Internet for anything relevant to the good character of the Onetai applicants had actually found something of relevance but it did not advise the respective Ministers of that. Nor could the actual online item be found when the independent reviewer requested it. The review, described by Labour as a “whitewash”, has made some minor procedural recommendations.

Process: Individuals Only & Self-Reporting

But the review was only ordered in the first place because the OIO was caught out by the massive Panama Papers leak. It does nothing to address the larger problems of the OIO. The major “good character” weakness is that it only applies to individuals. In the case of transnational corporate applicants it only applies to the individuals who own or control the company. Not to the corporation itself.

As far as the Overseas Investment Act is concerned, it doesn’t matter if the transnational corporation has a record as long as your arm.  It’s all above board so long as the people owning and/or controlling it are good blokes. Another major weakness is that it is a “self-reporting” process, which relies heavily on the applicant signing a statutory declaration, filed by an NZ lawyer on his or her behalf, saying “I’m of good character”. Presumably the Onetai Station applicants signed one of those.

Don’t take our word for it. To quote Martin van Beynen in the Press (7/5/16, “OIO Useless For A Reason”, http://www.stuff.co.nz/national/politics/opinion/79663424/governments-have-wanted-the-overseas-investment-office-to-be-useless): “The tireless Murray Horton and Bill Rosenberg, at the Campaign Against Foreign Control of Aotearoa, have been making lack of good character complaints to the OIO and its predecessor for nearly 20 years”.

Go to the CAFCA Website and type keywords “good character” into the Sitelevel Search part of the Search tool (this is the link http://www.sitelevel.com/query?query=good+character&crid=0c76d290&B1=SiteLevel+Search). The result is pages and pages and pages of articles we’ve written about different cases over many, many years. And what is the common denominator to all our “good character” complaints?  The OIO has never upheld any single one of them.

Even in the case of individual applicants who have a record overseas, the OIO has gone into bat for them to urge the Ministers to put to one side the “not of good character”  evidence and approve the application. The classic recent example of that was Kim Dotcom. Refresh your memory with James Ayers’ article “Kim Dotcom And The Good Character Test: Money Versus Power” in Watchdog 130, August 2012 (http://www.converge.org.nz/watchdog/30/06.html). Our source for that was the complete OIO file on Dotcom’s application.

Review Says OIO Must Not Offend “High Profile Persons”

And the review shies away from anything that might really work. There is a most revealing section headed “Police Checks”, which says, in part: “…Police checks are used internationally in immigration matters and Police authorities around the world are equipped to provide such a document. This suggestion is put forward for consideration by the OIO and is not put forward as a recommendation”.

“….An added difficulty for OIO is that applications for investment often involve high profile persons and the request for a Police check could create tensions and be perceived as offensive. To provide OIO with a discretion whether or not to require a Police check creates an awkward situation where refusal to exercise the discretion could increase the tension. This therefore is a matter that is best left to the OIO to consider having regard to all relevant factors”.

So, the OIO must not offend “high profile persons” (like Kim Dotcom, presumably) or use any tools that might actually work. Martin van Beynen was spot on with his headline “OIO Useless For A Reason”. That reason is quite simple – both the Government and the OIO see its function as being that of a doorman (doormat would be more accurate), a facilitator of the transnational corporations and other foreign applicants. Definitely not an overseer, regulator or investigator.

This role has been delegated to the OIO by successive governments headed by both major parties throughout the 40+ years of its existence (first as the Overseas Investment Commission). It has fulfilled the role with exemplary enthusiasm: of the very few applications where Ministers have exercised their rights to make the final decision, the OIO has always argued for approval, even when the arguments for refusal are overwhelming.

Let’s have a bouncer, not a doorman. But the OIO is only part of the problem of NZ’s incredibly laissez faire foreign “investment” policy (which translates as “come on in and help yourselves”). The whole regime, not just the rubber stampers, needs an overhaul. And to be replaced by one which puts the interests of the New Zealand people first and foremost. 

When the Crafar Farms sale to Chinese buyers first became a major political issue several years ago, John Key said that he didn’t want to see New Zealanders “become tenants in our own country”. CAFCA very rarely agrees with anything Key says but we’re happy to quote him on that one. In the owner-tenant relationship, there is no doubt about who holds the upper hand. Ownership means political power. Foreign control means recolonisation, but by company this time, not country.