Rex Patrick (SA, Centre Alliance) | Link to this | Hansard source

My question is to the Leader of the Government in the Senate, representing the Treasurer. Is it not the case that Australian organic infant milk formula, IMF, producer Bellamy's Australia has been waiting on the Chinese government's approvals to sell its product in Chinese retail stores for more than 20 months? Is it not the case that the Chinese government announced in June new rules to further tighten the sale of overseas IMF while encouraging Chinese companies to buy out foreign IMF producers? Is it not the case that the Chinese government's strategic regulatory delays have severely impacted Australia's IMF producers, including Bellamy's, putting significant downward pressure on their share prices? Is it not the case that the Chinese company Mengniu, the company seeking to acquire Bellamy's, is partly owned and closely linked to China's state owned COFCO group? Will the Foreign Investment Review Board and the Treasurer investigate the role of the Chinese government in manipulating market access to support Chinese company buyouts?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) | Link to this | Hansard source

The first point I would make in relation to the broader issue is that the government is aware of the announcement by Bellamy's to the ASX. The government does not comment on matters that are before the Foreign Investment Review Board. Let me make the general point that foreign investment is a key driver of Australia's economic growth. It creates skilled jobs, improves access to overseas markets and enhances productivity in Australia, which benefits Australian businesses and Australian consumers. Without foreign investment, production, employment and income would all be lower. The government recognises community concerns about foreign ownership of certain Australian assets, which is why the foreign investment review framework allows the government to consider these concerns when assessing Australia's national interest, while ensuring Australia remains an attractive place to invest. Where the government finds that a proposal is contrary—

Scott Ryan (President) | Link to this | Hansard source

Order! Senator Patrick, on a point of order?

Rex Patrick (SA, Centre Alliance) | Link to this | Hansard source

My question goes to the point of market manipulation by the Chinese government to suppress the share price.

Scott Ryan (President) | Link to this | Hansard source

Senator Patrick, that was the last part of a long question that contained a lot of information. The minister is entitled to answer part of the question. He is being directly relevant.

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) | Link to this | Hansard source

Maybe I can assist the senator by describing the role of the Foreign Investment Review Board. The board's function is advisory only. The responsibility for making decisions on policy and proposals rests with the Treasurer. The role of the board, including through its secretariat, is to examine proposed investments in Australia that are subject to the policy, the Foreign Acquisitions and Takeovers Act and supporting legislation; make recommendations to the Treasurer; advise the Treasurer on the operation of the policy and the act; foster an awareness and an understanding, both in Australia and abroad, of the policy and the act; provide guidance to foreign persons and their representatives or agents on the policy and the act; monitor and ensure compliance with the policy and the act; and provide advice to the Treasurer on the policy and related matters. Where the government finds that a proposal is contrary to the national interest, it will not receive approval. Significant reforms to the foreign investment framework came into effect on 1 December 2015, which improved the monitoring of foreign investment and which means we're now better able to measure the benefits of foreign investment for all Australians.

Scott Ryan (President) | Link to this | Hansard source

Senator Patrick, a supplementary question?

Rex Patrick (SA, Centre Alliance) | Link to this | Hansard source

Will the Australian government, through ASIC or FIRB, investigate the allegation that the Chinese government has manipulated the Australian stock market in respect of this takeover?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) | Link to this | Hansard source

Senator Patrick mentions ASIC. ASIC is an independent non-statutory agency. It is not up to the government to determine which areas or which action ASIC may or may not take. In the end, ASIC has got responsibilities that are well understood and well known. Consistently under the Corporations Act, they've got responsibilities in relation to market integrity and related matters, but it's entirely a matter for ASIC as an independent statutory agency to make these sorts of judgements based on the facts. That is not a matter for political decision-making, and I don't think that businesses around Australia ever would want this to be the subject of political decision-making. In relation to the Foreign Investment Review Board, I think I've answered that in my previous answer.

Scott Ryan (President) | Link to this | Hansard source

Senator Patrick, a final supplementary question?

Rex Patrick (SA, Centre Alliance) | Link to this | Hansard source

Is it not the case that China Mengniu Dairy is actually incorporated in the notorious tax haven of the Cayman Islands? Will the FIRB and Treasurer investigate China Mengniu Dairy corporation's structure and obvious international tax minimisation strategies in determining whether their acquisition of Bellamy's is in our national interest? How can this Chinese takeover of a successful Australian export business be in Australia's national interest?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) | Link to this | Hansard source

The government will ensure that any foreign investment proposal in relation to any asset that falls under the foreign investment review framework is assessed consistently with our laws to ensure it is not contrary to our national interests. We will not have that consideration play out in public. We will have that consideration appropriately, professionally in private and, when a decision has been made, the government will explain that decision that's been made and the reasons why.