More complex questions on CrafarJOHN HARTEVELT
The strange tale of the Crafar Farms sale drags on and on with no hint of anything like a resolution arriving soon.
The latest, today, has the Michael Fay-led consortium that's vying for the farms looking to bite off yet another win from the courts. It already won out of last week's ruling by having the adequacy of the economic test for the Shanghai Pengxin bid for the farms struck down by Justice Miller. But his ruling did not uphold the "business acumen" part of the Fay group's judicial review, so they're now having a crack at winning that point as well, via the Court of Appeal.
All of which is even more expensive and time consuming for everyone concerned. So what is Fay up to? And what on earth can the Government do to deal with this interminable issue?
Almost any way John Key turns on this issue, he is confronted with difficulty.
If the Overseas Investment Office - in its second-round recommendation - again backs the Shanghai Pengxin bid, ministers will almost certainly have that recommendation peer-reviewed by an outside legal entity. A subsequent rejection by ministers could only be on the basis that a peer review threw up red-flag discrepancies on legal points with the OIO (and Crown Law) view. That seems unlikely. Renewed OIO backing will almost certainly equal renewed ministerial backing. And given their uber-litigious record to date, that would almost certainly equal renewed legal action from the Fay group. In that scenario, the Government is back to bickering away in an argument it doesn't want to have.
The other possibilities are little more attractive for Key. If either the OIO or ministers reject the renewed Chinese bid, that would raise serious questions about where New Zealand's position on foreign investment now stands. How could Key defend a further tightening of the law when he has spent the past couple of months arguing there is no real problem, notwithstanding widespread public concern on the question? Moreover, a Key-led Government may well be seriously concerned about the economic implications of strangling or at the very least scaring off foreign investment.
At this point, only one thing about this saga seems clear. Politics, the law and economics have collided spectacularly and with each passing day the Key Government is suffering. At this point, they would most likely take any of your suggestions on how to extract themselves from this mess ...
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