Legal challenges to Crafar decision

ANDREA FOX
Last updated 12:02 09/05/2012

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Two legal challenges to the Government's consent for Chinese company Shanghai Pengxin to buy the Crafar farms are to be heard together in the High Court in July.

Businessman Sir Michael Fay, whose group of farmers and iwi want to buy the 16 North Island dairy farms, said the group's appeal over a High Court ruling earlier this year around Pengxin's proposed purchase, and its new, more recent challenge against the Government's second green light for the Chinese deal, are to be rolled into one hearing in Wellington on July 2.

The Government early this year allowed the $200 million-plus Pengxin purchase on the recommendation of the Overseas Investment Agency. A judicial review challenge against that decision by Fay's group, which has offered $171.5 million for the in-receivership farming estate, resulted in the High Court effectively sending the decision back to the OIO and Government ministers for a rethink. 

Fay's group challenged the OIO's recommendation on two fronts: that the Pengxin purchase was of economic benefit to New Zealand and that Pengxin had the necessary business acumen and farming experience to operate the farms. 

The court supported the economic benefit challenge, but not the business acumen question.

Fay's group has asked the Court of Appeal to rule on the High Court's latter decision.

Since then, the OIO has again recommended that Pengxin be allowed to buy the farms, which have been in receivership for more than two years, and the Government has again consented, sparking a fresh legal challenge from Fay's group.

A spokesman for Pengxin has said the company intends to have its proposed farms manager, state-owned enteprise Landcorp, on the farms by spring, but will not say whether the deal with the receivers is unconditional.


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- Waikato Times

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