Government sets sights on water bottlers in next round of overseas investment restrictions

Water bottlers are in the Government’s sights as it seeks to make yet more changes to overseas investment rules.

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Water bottlers are among those in the crosshairs as officials mull a national interest test for investments from overseas. Source: 1 NEWS

Associate Finance Minister David Parker has announced proposals that would see red tape cut for foreigners who wish to invest in New Zealand businesses.

But he also wants to introduce a "national interest test" for anyone from overseas who wished to invest here.

The test would look at whether the investment could threaten our national security, affected iwi or water rights, or if it involves essential infrastructure such as power lines or airports.

Mr Parker says ministers would like “more discretion”.

In Australia, a very broad test is available but used rarely, he says.

The other option is to have a much narrower national interest test.

Bell Gully lawyer Andrew Petersen says it’s no surprise the Government is looking at issues around water or iwi rights.

But the test could be controversial and difficult to administer.

“How that translates into normal applications for normal investors could be a concern, because a national interest test gives ministers a lot more discretion than they currently have to say no to an application,” Mr Petersen told 1 NEWS.

The Greens say they pushed Labour to include water extraction in the latest round of changes to the Overseas Investment Act.

The first round of changes, introduced late last year, saw foreigners banned from buying existing properties. Data provided by Land Information NZ shows that has led to a decline in the number of foreigners buying houses here.