NZPA | 18 December 2009
The Green Party is calling on the government to tighten the rules over what it sees as a land grab by foreign interests.
Green co leader Russel Norman is worried about reports that a New Zealand buyer is acting as a proxy for a subsidiary of the Dubai government to buy thousands of hectares of South Island farmland.
Norman says the Overseas Investment Act needs to be strengthened to stop back door deals.
He says there needs to be a national interest analysis under the Act to look at the sale of land and marine farms.
Norman says New Zealand risks losing its sovereignty by selling its primary production to foreign investors.
Large areas of New Zealand land would effectively be controlled by a foreign government if the deal went ahead, says Russel Norman.
The benefits from selling the food would not kept within the New Zealand economy, but would instead be passed on to overseas interests.
Federated Farmers reaction
Federated Farmers is urging farmers to conduct strict due diligence checks before signing sale contracts in the wake of reports
"It goes against every commercial norm for major capital items to be sold on a 'no-deposit' basis and farms are as big a capital item as you can get," said David Rose, Federated Farmers rural security spokesman.
Federated Farmers told its own farmers considering selling that they could contact its lawyers to discuss the deals, and suggested non-members take independent advice.
"I am extremely nervous of reports that no-deposits are being taken," says Rose. "It's pretty fundamental that a deposit be exchanged as a tangible sign of good faith".
"We are naturally concerned that the supposed backer may not be prioritising the purchase of Southland farms," says Rose. "The fact that a reported deposit milestone has already been missed is further cause for alarm."
The Maori trust has contracted to buy nearly 30,000ha of dairy, sheep, beef and deer farms throughout Southland, but some sellers have raised queries ranging from delays confirming the sales contracts to deposits not being paid as expected.
Two of Southland's largest rural real estate companies, PGG Wrightson and Southern Wide, declined to deal with the trust, but the farms have been bought through other real estate agents.
A spokesman for the purchasers, Wynn Murray, told the Otago Daily Times the trust was a serious buyer.
It had financial backing, including from overseas, and sales contracts would be made final in late February or early March.
The delay was because of dairy farmers wanting to see out the milking season and deposits would be paid when contracts were finalised, he said.
Murray, from Invercargill, declined to name the trust he represented or confirm it was being funded from Dubai.
He did confirm that an option was for milk from the trust's farms to be processed specifically for Dubai markets.
Murray says the trust he represented was not aligned to a tribe, but made up of a group of individual Maori people from throughout New Zealand who had pooled their resources.
"We're just Maori people who have got together and decided, `Let's do this'."
There was no Treaty of Waitangi settlement money involved.
He has been buying farms for the past three or four months and, while he had been told to stop, expected to resume again in the new year.
Murray says farm managers and staff would keep their jobs under the new ownership, and product would be supplied to existing processors.
