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Duties Amendment Bill 2019

Cassy O'Connor MP  -  Tuesday, 26 November 2019

Tags: Foreign Investment, Legislation

Ms O'CONNOR (Clark - Leader of the Greens) - Mr Deputy Speaker, that was an unusually shallow contribution from the shadow treasurer, who did not touch on any of the issues that this bill encompasses.

We will not be opposing the Duties Amendment Bill 2019. We regard this legislation as a sop to growing public concern about the level of foreign ownership in Australia and in Tasmania - and a pretty lame one at that. According the ABS statistics, around a quarter of Tasmania's agricultural land is foreign owned. In the north-west coast region of Tasmania, more than 30 per cent of our prime agricultural land is owned by foreign interests. We agree that we need to be able to attract foreign investors but we need to keep a careful eye on this. We need to be mindful of our sovereignty and our future food security, our capacity to manage our natural resources, our water resources and the like.

This is an issue that has provoked a growing level of concern within the Tasmanian community as people see all around them evidence of increased foreign company investment in Tasmania. There is no doubt whatsoever, that since Chairman Xi's visit in November 2014, there has been a feeding frenzy of investment from mainland China in Tasmania's agricultural lands and residential properties. Someone in the House has to get up and say this, because it is true. It is a matter of public concern.

Only last Friday, at the same time as the minister responsible for Parks was quietly slipping out news of the Bruny Island lighthouse expressions of interest, the Tasmanian Planning Commission handed down its determination on the Cambria Green development. The process of the development's journey through the planning system caused enormous stress on the east coast of Tasmania. The Greens were a representor and what we learned in that process is that there was very clearly an attempt by the individuals and entities involved to get around our foreign investment rules.

There are 12 parcels of land, totalling more than 3000 hectares that comprise the proposed development footprint. Nine separate companies, which the developer's advocate admitted to the Planning Commission, were set up in order to progress this development. Of those nine separate companies, seven of them are registered on the Hong Kong Stock Exchange. There was a deliberate attempt to establish a company structure and structures to get around our foreign investment rules and buy a very substantial area of land on the east coast of Tasmania, important agricultural land, in an area that is drying and very near to Moulting Lagoon, which is an internationally significant wetland.

What happened with that development proposal is that all the previous Glamorgan Spring Bay Council saw were the dollar signs. They did not do any due diligence on who owns those parcels of land - none at all. It is very clear from the Planning Commission's judgment that the previous Glamorgan Spring Bay Council was negligent in its responsibilities as a planning authority under LUPAA. The previous Glamorgan Spring Bay Council waved through the specific area plan proposal without even doing the basics on the documentation that was provided by the planner on behalf of the agent for the mystery proponents.

What our independent planning system found was that they did not have jurisdiction to determine on that development, basically because the previous Glamorgan Spring Bay Council could not see past the dollar signs and the promises that were made by the developer's proponent and waved it up to the planning commission.

The people of Dolphin Sands and Swansea have been let down by the previous Glamorgan Spring Bay Council. Thank goodness for our independent Tasmanian Planning Commission, which did drill down, to the greatest extent possible, into the details of this opaque company structure; a whole lot of companies, set up by a foreign entity to buy Tasmanian agricultural land, to get a carve out of the planning system to build God knows what really. Once you have a specific area plan, all bets are off really. It was going to be a massive tourism/palliative care/resort-type development with an airstrip where we are reassured by the proponents there would be no more than 20 flights a day.

It is a problem we have in Tasmania. Often planning authorities and major parties cannot see past the promised dollar signs. There really is an outstanding and sad example of that from relatively recent history. I am reading an article written by the ABC's Georgie Burgess back in February 2014, so it was before the 2014 state election. We have the then shadow treasurer cheering on a proposed massive development at Musselroe that ends up being part of a Chinese money laundering scam. Doesn't it? Again, this is a classic example of not seeing past the dollar signs. Georgie Burgess wrote at the time,

North-east Tasmania is set to receive a tourism and job boost with one of the biggest construction projects in Tasmania ready to go ahead. The $ 185 million Musselroe eco-tourism development is now in the detailed design stage after receiving development approval in November. The project is expected to create 970 new jobs during stage one of construction and 360 full-time jobs after completion.

Well, yeah, yeah. Ended up creating precisely zero jobs. Ended up being a massive money laundering scam involving our beautiful, prime agricultural land at Musselroe Bay in north-east Tasmania. The story goes on,

Construction is planned to start as early as May and will take five years to complete. Liberal Treasury spokesman, Peter Gutwein, said the Liberals would back in the project, promising $5.5 million to upgrade roads in the area if his party won government.

Sound familiar? Well, yes, it does because this is the same now Treasurer who spent public money upgrading a facility on Bruny Island just before announcing a private developer is going to operate the lighthouse. We have the then shadow treasurer promising $5.5 million in public funding to a dodgy development in north-east Tasmania that is now the subject of an AFP investigation. I quote from the then shadow treasurer -

Upgrading unsealed sections of the main access roads to the site is regarded as crucial to the long-term success of the development.

'… crucial to the long-term success of' this money-laundering operation. Mr Gutwein goes on to say -

World-class facilities like Musselroe Bay will help drive regional tourism growth in addition to creating much-needed jobs.

No, it was a massive criminal operation and that land has now been seized.

What happened to that $5.5 million road upgrade promise? We need to be clear here that state Labor had already committed to giving $5.5 million to improving the road network, provided it was matched by a federal government commitment to complete the $11 million upgrade. Are you all in on the money-laundering scam, then? The Dorset Council pledged $500 000 of ratepayers' money. The development, which was the subject of a money- laundering scam, is situated on a 1900-hectare former grazing property near Great Musselroe River and wukalina/Mt William National Park. The story says, 'Melbourne Resort Development is the company behind the project and it has appointed CBM Sustainability Growth Group to project manage'. Melbourne Resort Development was a bunch of crooks, Madam Deputy Speaker, but they had the Liberal Party, the Labor Party and the local council slavering all over them because of the promise, which ended up being an empty promise made by criminals. Nice work, both of you.

The proportion of foreign ownership of agricultural land has increased every year since reporting began in 2015-16. Tasmania now has 362 000 hectares of agricultural land held by foreign interests. This is 24.5 per cent of all Tasmania's agricultural land, second only to the Northern Territory. In the north-west, the proportion of ownership is more than one-third. In 201516 the United Kingdom had by far the largest share in Australian agricultural land with 27.5 million hectares. China was the fifth largest with 1.4 million hectares. In 2016-17 this changed significantly. The United Kingdom's interests dropped to 9.7 million hectares and China's interest increased to 9.1 million hectares, far ahead of the third-placed United States with 2.5 million hectares, a dramatic shift in just one year.

This is unsurprising, as China's Belt and Road Initiative in Australia focuses on, amongst other sectors, agribusiness. It needs to be pointed out here that the Belt and Road Initiative, which Victorian Labor Premier Daniel Andrews has signed Victoria up to, has led to Sri Lanka having its Hambantota Port seized by the Chinese government because they could not pay their debts under the Belt and Road agreement they had struck with the Chinese government. Now the main port in Mombasa in Kenya is about to be seized by the Chinese government as part of its payback for the Kenyan government not being able to service its debts under the Belt and Road Initiative.

We should not have any part of the Belt and Road Initiative as a country. We should never have leased the Port of Darwin to a Chinese company. That was an act of stupidity. This is what the Chinese government does, of course. In the words of Mao Zedong, 'You use the countryside to surround the city'. That is what they did with the Northern Territory government, that is what they are doing with Daniel Andrews' government and that is what they are doing down here, courting the Premier and his ministers, because they know that in Canberra there is growing awareness about the problem, particularly in the past week or so when there have been a number of significant developments.

We have a person who claims to have worked for Chinese intelligence seeking asylum in Australia who has direct testimony of attempts to interfere in Hong Kong politics, Taiwan's democracy and Australia's democracy. We had an allegation go to air on Sunday night on 60 Minutes about an attempt by the Chinese government to install a proxy, if you like, in the federal parliament. That ended in the most tragic circumstances for the person who made that allegation. It is worth pointing out that the Liberal member for Chisholm, Gladys Liu, has never explained herself in the federal parliament and the evidence of her deep ties to the Chinese government and the work of the United Front Work Department.

We also have had in the past week the largest ever leak coming out of the Chinese government, 400-odd pages straight out of the heart of the CCP, detailing its cultural genocide in Xinjiang, where it is estimated anywhere between 1 million to 3 million Uyghur Muslims have been incarcerated in concentration camps, and the word 'concentration' was used in those documents. Madam Deputy Speaker, we are dealing here with a government that is trying to wipe out the culture of the Uyghur people, taking their children away from them.

Madam DEPUTY SPEAKER - I remind the member that we are on the Duties Amendment Bill.

Ms O'CONNOR - Absolutely. It is entirely relevant because in this place we have facile contributions from both the major parties on this issue which are completely out of touch with the facts and reality and public opinion.

I was talking about the Belt and Road Initiative. The China-Australia Free Trade Agreement which we have signed up to also provides duty-free or favourable rates for 85 per cent of goods exported to China. The value of food products exported to China has increased from $93.3 million in 2015- 16 to $190.9 million in 2017-18. To anyone who asks why the increase in the value of exports to China is of concern, I refer them to the debate on a Greens motion to ban impersonation of foreign law enforcement on 4 September this year. I will simply remind the House again that every single mainland Chinese company that is operating in Tasmania is bound by article 7 of the National Intelligence Law, which requires them to work with the Chinese government on national intelligence. Extraterritorially, it requires of them to spy for the Chinese government. We need to be aware of that. We need to go into these situations and these policy areas with our eyes wide open, but instead what we get from the old parties in here is a glossing over which serves not the Tasmanian people or Tasmania's interests.

During that debate in September this year on the impersonation of a feared Chinese law enforcement agency, both the Attorney-General and Labor's police spokesperson, Dr Shane Broad, cited the importance of our trade relationship with China as the reason to be cautious about challenging some of the behaviours being carried out in the Chinese government's name here in Tasmania. When China ramps up their investment in Australia and Tasmania, the Chinese government does so knowing they are buying the silence and inaction of our major political parties.

The Foreign Investment Review Board has a range of rules for foreign investment in agricultural land or agribusiness. Depending on a range of factors, there are a variety of thresholds that require approval. The approval requires satisfaction that the investment is in the national interest. I do not understand how it could be in the national interest to sell Bellamy's Organics and Pura Milk to Mengniu Dairy. I do not understand how that could be in the national interest and I am sure a lot of Tasmanians do not understand either.

Mr Gutwein - Who owned Pura Milk before? I think it was the Japanese.

Ms O'CONNOR - It is probably not a company that is subject to article 7 of the National Intelligence Law.

Mr Gutwein - The Japanese.

Ms O'CONNOR - Do they have a national intelligence law that requires their companies to spy extra-territorially for the Chinese Communist Party?

Mr Gutwein - You are having a broad swing at foreign ownership.

Ms O'CONNOR - No, I am not. You can try to spin it that way.

Mr Gutwein - That is what it sounds like.

Ms O'CONNOR - Well, you keep being a shill.

Mr Gutwein - A what?

Ms O'CONNOR - Keep being a shill - a mouthpiece for vested interests.

The approval requires satisfaction that the investment is in the national interest. The national interest test stems from the Foreign Acquisitions and Takeovers Act 1975, which provides that the federal treasurer has the authority to review certain investments and approve them if they are satisfied that it is in the national interest. The act does not establish what the national interest means - readily. The national interest test is established in Australia's foreign investment policy. As such it is not legally binding.

While the Foreign Investment Review Board can advise the Treasurer on these matters, authority lies with the Treasurer who, only two weeks ago, gave permission for the takeover of Bellamy's Organic.

Madam DEPUTY SPEAKER - Can I ask you to come back to the bill, please?

Ms O'CONNOR - I am on the bill. Can you explain to me how I am not on the bill, Madam Deputy Speaker?

Madam DEPUTY SPEAKER - It is about the Duties Amendment Bill 2019.

Ms O'CONNOR - Thank you for explaining to me what I know. The Duties Amendment Bill applies to foreign natural persons and foreign persons. That is an issue that comes within the orbit of the Foreign Investment Review Board. There is a connection between the work of the Foreign Investment Review Board and the amendments that we are debating here to the Duties Act 2001. There is a very clear connection. For example, these amendments give the commissioner the authority to decide a foreign person or foreign natural person is not a foreign person or a foreign natural person for the purpose of an exemption, potentially, under the Duties Act to the surcharge that we are debating here today.

There is nothing in this legislation that will do anything to curb the level of foreign ownership of prime agricultural land and residential property in Tasmania. Nothing. It is simply a modest revenue-raising exercise on the part of the Tasmanian Government and a sop to growing community concern about the level of foreign ownership in Tasmania and in Australia.

It is a matter that is not being adequately dealt with by either level of government when you can have nine separate companies established to buy 12 parcels of land on the east coast of Tasmania to try to step through a massive project.

Clause 30L states -

Determination that transferee not a foreign person

(1) A transferee who -

(a) is a foreign person for the purposes of this Part; and

(b) as a result of being a foreign person, is liable to pay duty under this Part on a dutiable transaction

may apply to the Commissioner, in writing, for the Commissioner to determine that the transferee is not to be taken to be a foreign person for the purposes of this Part.

The principal act's definition of 'foreign natural person' means -

… a natural person who is not any of the following:

(a) an Australian citizen within the meaning of the Australian Citizenship Act 2007 of the Commonwealth;

(b) the holder of a permanent visa within the meaning of the Migration Act 1958 of the Commonwealth;

(c) a New Zealand citizen who is the holder of a special category visa within the meaning of the Migration Act 1958 of the Commonwealth; [OK]

A 'foreign person' means the following:

(a) a foreign corporation (other than as a trustee acting in its capacity as trustee);

(b) a foreign natural person (other than as a trustee acting in its capacity as

(c) a foreign trustee acting in its capacity as trustee;

I would like the Treasurer to explain why it is necessary, first of all, to have a clause that allows a foreign person or a foreign natural person -

that is, a foreign company or a foreign investor - to argue that they are not foreign for the purposes of getting around paying a modest duty on their purchase of agricultural land or residential property in Tasmania.

While the Commission may make a determination that a foreign person or a foreign natural person is neither of those things for the purposes of this act, they will remain a foreign person or a foreign natural person. That is a perversity in this amendment. I would like the House to understand why it was necessary to provide that carve out for a foreign company or a foreign investor, wherever they have come from.

There are countries in the world, for example, China, where it is illegal, you cannot buy land, you cannot buy your own house in China. Yet here we are as a country selling out our agricultural land with abandon. It would be good to understand why that carve out was provided.

The Treasurer says in his second reading speech, in order to explain why the original position on a foreign investor surcharge was crab-walked away from, that he consulted with key stakeholders. Is he prepared to provide some information to the House about who those key stakeholders were? And not an abbreviated list that you choose, but it would be good to have something formal on the table about how that was arrived at.

There are carve outs, as I was discussing, to foreign investment rules on residential property but there has been a buy-up of established Tasmanian homes by foreign investors. The Foreign Investment Review Board has not been able to stem that. People were sleeping at the showgrounds last year . We do not have enough homes here. Surely, there should be some rigor around the rules for established properties, but there is not. You only have to talk to real estate agents in Tasmania to understand that foreign buyers are investing very heavily in the residential real estate in Tasmania, particularly in Greater Hobart. It is an issue and we should be prepared to name it up.

I expect the Treasurer to get up shortly and roll out his tired old tropes about racism and xenophobia. I am deaf to them because the Greens are on the right side of history on this issue. The Treasurer would cheer on any and every foreign investment in Tasmania as he did back in 2014 when he promised money-laundering criminals from China $5.5 million in public funds to further development on a massive parcel of prime agricultural land in north east Tasmania.

Somebody in this place has to tell the truth about these issues and it will be the Greens. We will speak truth to power. That is what we do. We are not compromised by the donations that come from our corporate mates and vested interests in foreign companies. We will tell the truth in here . We did not take $25 000 from the now banished and disgraced businessman Huang Xiangmo. It was the Tasmanian Liberals who took that money. That is why they are compromised on these issues. That is why the Treasurer gets up and makes his shrill accusations. They are utterly compromised. They took money from an entity which ASIO had warned the major parties about in 2015. The Tasmanian Liberals took that money. Mr Huang Xiangmo is never coming back to Australia; he has been banished because of his connections that our security agencies obviously recognised as a potential security threat.