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Wednesday, 11 August 2004
Page: 26240

Senator ELLISON (Minister for Justice and Customs) (10:22 PM) —While a number of issues have been raised, it is important that the government put on record the position on schedule 5, which deals with foreign acquisitions and takeovers. Firstly, the negotiated outcomes on foreign investment screening in the agreement will deliver significant benefits to Australia by enhancing Australia's attractiveness as a nation for foreign investment. The agreement, however, successfully preserves the core features of Australia's investment policy. The government has retained the right to examine significant foreign investment proposals in all sectors to ensure they do not raise issues contrary to the national interest. I note that is an issue which senators opposite have raised.

Acquisitions of a substantial interest in an Australian business valued at over $800 million will need to be notified and examined. Foreign investments by foreign governments in urban land, including residential properties, will continue to be screened regardless of value. Foreign investments in sensitive sectors such as the telecoms, transport and defence related industries will continue to be subject to screening above the existing threshold of $50 million. Furthermore, existing foreign investment limits relating to the media, Telstra, CSL, Qantas and other Australian and international airlines, federal leased airports and shipping have all been preserved. Moreover, to address national interest concerns the government has retained the right to impose conditions on screened investments. Australia's strengthened environmental laws, introduced in 2000, mean the government no longer has to rely on foreign investment policy to address environmental issues. The Australia-United States free trade agreement will not affect the right of governments at both the state and territory level to require new investments, whether by foreign or domestic investors, to meet appropriate standards and requirements on issues such as environmental health and planning matters.

This section of the bill is essential to bring Australia into compliance with the agreement, and it must be passed. We cannot cherry pick aspects of this. This schedule is important for the agreement, and it has to remain for Australia to comply with the agreement. Senator Ridgeway asked a question about film and television. Existing and future measures in the film area, such as Film Finance Corporation activities, are fully protected. This advice has been provided to the industry. There are no limits on subsidies and funding for investment in full production. Senator Nettle asked a question about these provisions applying multilaterally. We will assess the merits of any free trade agreement with any country against the national interests of Australia. There are provisions in this agreement which might not be applicable to any particular agreement in the future. We are not saying that this is something that will apply willy-nilly across the board.

I think Senator Ridgeway asked a question about how this interacts with reservations. The investment chapter includes strong protections for investors from the two countries. Reservations in the chapter, as well as other safeguards in the chapter, fully protect areas important to the public interest. There are already strong two-way investment flows between the United States and Australia, and this strengthened framework will further enhance this. Australian businesses have significant investments in the United States. That is a fact; you cannot escape it. Our foreign ownership limits in the media sector and other areas have been fully protected. The provisions in this schedule that deal with foreign acquisitions and takeovers preserve the integrity of our investments screening in relation to investments in sensitive sectors, which I have outlined. The agreement will provide a strong framework for promoting high levels of two-way investment flows between Australia and the United States, and these have been strongly endorsed by the community.