Overseas investment shake-up sees extra step for water bottling consents

New rules around water bottling will see an extra hoop to jump through for overseas investors, the Government announced today while also touting a number of changes around granting consents for critical infrastructure. 

Source: 1 NEWS

Associate Finance Minister David Parker said the Government will now "require consideration of the impact on water quality and sustainability of a water bottling enterprise, when assessing an investment in sensitive land". 

It will look at the positive and negative impacts on water quality and sustainability. The Government is still looking at whether to put royalties on bottled water exports.

It comes along with the introduction of "a number of new powers, consistent with global best practice, to protect New Zealands' best interests". 

The second wave of changes to the Overseas Investment Act will bring in a "national interest test", introduce a national security "call in power", and add another step for overseas water bottling companies to get consent. 

The national interest test will let ministers consider potential risks when deciding to grant consent to overseas investments. If it is found to be against the national interest of New Zealand, consent can be declined or conditions imposed. 

The call in power is set to screen "high-risk critical national infrastructure". If found to pose risks to national security, then it can be blocked or conditions can be applied. 

"These tests would only be used to control investments in significant media entities where these are likely to damage our security or democracy," Mr Parker said. 

"These powers will be used rarely and only where necessary for protecting New Zealand."

Fixed penalties for not complying will be brought in, rising from $300,000 to $10 million for corporates. 

The bill will be introduced early next year. 

In April, the Government hinted it would bring in a national interest test, and Mr Parker was exploring more rules around water bottling.

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.