Isaac Davison is a NZ Herald political reporter.

Government to raise Overseas Investment Office fees

John Key said the OIO needed more resources so it could check that investors were following through with their promises. Photo / Doug Sherring
John Key said the OIO needed more resources so it could check that investors were following through with their promises. Photo / Doug Sherring

The Government says it is hiking the fees for foreign investment applications to help the Overseas Investment Office increase its workforce and keep a closer eye on investors.

Prime Minister John Key said the fee increase would be "substantial" and would allow the foreign investment watchdog to lift its staff numbers by 25 per cent.

At present, application fees range from $10,000 to $20,000.

Mr Key said the OIO needed more resources so it could check that investors were following through with their promises.

"What we're in essence saying is that the office needs to have a better way, in our view, of making sure that those who make undertakings that they'll put in a walkway or whatever it might be actually fulfilling those commitments."

The changes would allow the Overseas Investment Office (OIO) to vet applications more thoroughly but also more quickly, Mr Key said.

"We want them to process things a bit more quickly because a lot of the applications are finalised very close to the cut-off date and it's quite frustrating for investors."

Mr Key said the changes to the OIO were not an admission that it had been performing poorly.

"You can always improve things and this is an attempt to do that," he said.

The OIO has been in the spotlight in the last week after it was revealed that it approved the sale in 2014 of a large farm in Taranaki to Argentine investors who had previously been found criminally responsible for toxic charges into a river in Buenos Aires.

http://www.nzherald.co.nz/business/news/article.cfm?c-id=3&objectid=11632825

The case has led to two separate reviews -- one of the consent itself, and another of the way the OIO provides information to ministers about potential breaches of "good character" requirements.

Labour MP David Cunliffe says the case is the "tip of a very nasty iceberg" and has promised to reveal more cases in Parliament today in which applicants had breached good character criteria.

Mr Key said that if the Argentine investors were found to have omitted information on their application, the OIO had power to force them to sell the $6 million farm.

Land Information Minister Louise Upston said that if anyone knew about misconduct by a foreign investor, they should raise it with her as soon as possible.

She said that the Taranaki farm case was a "one-off" in which "one individual dropped the ball". The minister would not comment on whether that OIO employee had been disciplined for their error.

Ms Upston also dismissed allegations by Labour that OIO staff were relying solely on Google searches to vet prospective investors' backgrounds.

Labour's finance spokesman Grant Robertson said the Government had "bowed to the inevitable".

Until now, the OIO had been too dependent on statutory declarations from prospective investors that they met good character requirements, he said.

"I don't think we can be confident that rigorous checks have been done on the background of all the applicants."

Labour's finance spokesman Grant Robertson said the Government had "bowed to the inevitable".

Until now, the OIO had been too dependent on statutory declarations from prospective investors that they met good character requirements, he said.

"I don't think we can be confident that rigorous checks have been done on the background of all the applicants."

- NZ Herald

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