NZ Herald
NZPA.

Foreign companies would face no legal barrier if they wanted to buy all of New Zealand's fishing quota, a High Court judge has ruled. Justice Ronald Young found that the Government's policy of "New Zealandising" the industry was not enshrined in law. Changes were made to the law in 1999 with the intent of tightening sales of quota to foreigners. A national-interest test had to be applied by the Overseas Investment Commission (OIC) and ministers when approving such sales.

But Justice Young said it was still possible for foreign companies to buy quota. It was an error to assume "New Zealandisation equates with the natural interest" and wrong to argue that "New Zealand ownership of all quota, no matter what the circumstances, will automatically be in the national interest". "This is misconceived. The OIC and ministers have far broader questions.

"Parliament could have prohibited overseas ownership absolutely. It did not do so. "While I imagine no Government would allow it to happen, all quota could be controlled by overseas companies."

To fulfil Justice Young's hypothetical scenario of 100 per cent overseas ownership, all New Zealand owners of quota would have to want to sell and the OIC and the Government would have to approve those sales.

Justice Young had been asked to rule on a dispute between Talleys Fisheries and its Japanese partner, Mahura. The two companies have a stake in Ceebay Holdings. Ceebay, a quota leasing company, has been in business for a decade with some component of foreign ownership.

Talleys went to court to see whether Ceebay could legally hold quota after the 1999 law changes. In his judgment, Justice Young upheld the approvals of the OIC and the Government to grant Ceebay 8500 tonnes of hoki quota in 2000. Talleys argued that the quota decision was contrary to the law and the "New Zealandisation" policy.

The company also contended that there had been a lack of consultation and the decisions were based on flawed advice about the company and its record. Justice Young rejected the complaint.

The general manager of the Seafood Industry Council, Alistair Macfarlane, said he could not comment on the judgment or its implications until he had seen it.