Talleys' foreign quota case fails

By IRENE CHAPPLE

Talleys Fisheries is calling for a law change after the High Court at Wellington roundly rejected its case against a Government decision allowing a foreign-owned company to lease quota rights.

Talleys said quota ownership by Ceebay and its subsequent lease of some quota to shareholder Maruha (NZ), wholly owned by Maruha Corporation of Japan, was against the Fisheries Act's policy of encouraging local ownership.

Maruha's leasing of the quota was allowed through the Overseas Investment Commission, with ministerial consent, which applied the test of "national interest" for foreign ownership.

Talleys sought a judicial review of the decision, arguing it was against 1999 law changes that replaced restrictions on foreign ownership with the discretionary test.

The judgment said Talleys had erred in thinking local control was the equivalent of national interest.

"They effectively submit that New Zealand ownership of all quota no matter what the circumstances will automatically be in the national interest. This is misconceived.

"The [investment commission] and the ministers have far broader questions than that plaintiff's narrow focus on New Zealanders owning quota," said Justice Ronald Young.

"Theoretically, this means all quota could be held in foreign ownership if it was deemed in the national interest."

Talleys' director Andrew Talley said the test made the law unclear.

"The judgment goes against the intention of Government to restrict foreign ownership," he said.

However, a spokesperson for Finance Minister Michael Cullen said it was not credible that any government would think all foreign ownership was in the national interest, and Talleys was the only company confused by the legislation.

There were mitigating factors for Maruha to hold quota, including its fishing history in New Zealand that began in the 1950s.

Maruha's lawyer, Zane Kennedy, said the decision was as expected. His client had a history of contributing positively to the fishing industry and this would continue.

The law suit listed Dr Cullen as first defendant with Fisheries Minister Pete Hodgson, then the Overseas Investment Commission as second defendant, the Ministry of Fisheries third and finally Maruha (NZ) fourth defendant.

Other rejected allegations included the decision falling outside the jurisdiction of the minister and the investment commission.

Mr Talley said he was disappointed and surprised by the decision, and was considering an appeal. Talleys would lobby for a law change. Costs have been reserved.