Foreigners buying up Australia

The screening of foreign investment was fascinating and satisfying. It meant participating, even from the outside, in a facet of the real world. We met some of the movers and shakers of this world. We also met some of the legal people who ate well as intermediaries between that real world and the cushy world of government policy.

The Australian concept of screening foreign investment was questionable from the very start. First, it originated as a bipartisan policy and our office naturally ensured that it remained so. However, when both sides of Parliament agree on a policy, the people can be screwed – and could have no protection politically. Second, the screening was to ensure that a take-over or a new investment was not against the national interest.

What did that mean, asked everyone who came to us? We, too, asked the same question. Indeed, a foreign take-over would have to be demonstrated by us to be very damaging before it could be stopped. Could a new foreign investment be damaging? That would be the day! Third, we were working for the Treasury, the non-interventionists whose credo had been that all foreign capital is good capital.

My first case involved a man I had come to know well in my days on tariff matters. His foreign-owned company wanted to buy a small Australian-owned manufacturer. The owner of the Australian enterprise opened the batting: what right did the government have to stop him selling his business to anyone?

Seeking inspiration, while a senior colleague looked at me quizzically, I looked at my friend and said with a grin, “What right would an Australian manufacturer have if it allowed government to place one foot into its door – by accepting tariff protection – to say to that government that it cannot now place the other foot in the door to screen an intended foreign take-over?” That broke the ice that had been evident from the moment of their arrival. On the other hand, I could have said, “If a camel’s head gets in the tent, his body will follow,” but that would not have been proper.

I then explained that our job was not to defend government policy, which was a political decision, but merely to explain it. We could also explain our developing procedures. The government’s objectives were set out in Hansard (the record of Parliament’s deliberations) mainly in the Second Reading Speech. Decisions would be taken only at the political level, i.e. by the Minister. And both the decisions and our processes, including our interpretation of legislation, could be tested in the courts.

That approach seemed to satisfy them and others whose proposals came to us. Later, I was to brief lawyers and industrialists not only on a case-by-case basis but occasionally in small groups. It was satisfying to have the lawyers agree with the way we interpreted legislation (with the help of lawyers in the Attorney-General’s department) and, later, additional non-legislative policies. No one took us to court. That could also mean that the decisions taken were either acceptable or not worth contesting. Most proposals were approved.

It was rather a surprise for us when, in later years, the government passed legislation setting out how to interpret legislation. We presumed that this was for the benefit of certain judges and lawyers who apparently took a literal or semantic interpretation of specific words in legislation. Creative accounting was burgeoning into a major art form and some lawyers apparently became skilled in the deconstructionist analysis of the written word. Our interpretation of our legislation was validated.

One of the funniest experiences I had was when a European entrepreneur received an offer for his Australian company from a foreign corporation. The European was an Australian citizen, as I was, and so was the CEO of the Australian subsidiary of the foreign corporation. The CEO went through the usual argument that he and his management were true-blue Aussies and that his company was surely Australian too. The European and I agreed, adding that we were Aussies too, although obviously not local-born.

I was explaining the nature of our policy when, all of a sudden, the three of us saw the humour of the situation simultaneously, and we started to laugh. The true-blue Aussie had to satisfy a migrant Aussie that his company would not damage the national interest by buying the other migrant Aussie’s business. The CEO then kindly agreed that, when the appropriate foreign person snapped his fingers, only he would have to salute.

(These extracts from ‘Destiny Will Out’ will surely indicate that I am not just a pretty face. Personnel management, by taking me out of a hot fry-pan, had found the one person in the agency who had the necessary experience to operate the new policy. This was to deal with the movers and shakers of the private sector on a case-by-case basis, but yet within the umbrella of both the law and prevailing business practices.

The agency was extremely fortunate in this, because the 4 members of the team were, I knew, seen as surplus to need. Unfortunately for the high-nosed ones, I did not need to consult anyone to establish my procedural approach, and my case-recommendations; the near-retirement senior official set above me approved everything I put before him.

Progressively, 8 sections grew out of the work of my team, leaving me with the very diverse service industries, which suited my need for variety in my work and an on-going challenge. I just made sure that no one could better my work! A loyal and reliable team will ensure that.)