A Senate inquiry into foreign investment will scrutinise the investment approval process.
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Bellamy's, VDL Dairy and Musselroe Bay in Tasmania will all be case studies for the inquiry.
Tasmanian Greens senator Peter Whish-Wilson, who established the inquiry on Wednesday, said recent investment approvals have revealed flaws in the current system.
"There have significant concerns about market manipulation ahead of the takeover of Bellamy's and around the government's unwillingness the revisit the voluntary undertakings made when it approved the purchase of VDL Dairy," Senator Whish-Wilson said.
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"The government's failure to ensure the integrity of the foreign investment approval process is undermining what faith the public has that these takeovers are being approved in the national interest."
Senator Whish-Wilson said money-laundering through property has been allowed to run rife.
"In particular, the recent bust of the $23 million property purchase in Tasmania of Musselroe Bay needs to be examined," he said.
"Is this just a one-off or is there something systematic going on? Is money-laundering on the Foreign Investment Review Board's radar given the loophole for real estate agents, lawyers and accountants?"
Premier and Trade Minister Will Hodgman said the government welcomes foreign investment in Tasmania but also believes it must be balanced with the best interests of Tasmanians.
"Tasmania needs both domestic and foreign investment to deliver jobs, growth and opportunities for our state, with foreign direct investment playing an important role in our state's economy," Mr Hodgman said.
"Foreign investment brings much needed capital, technology and innovation, which are key to enhancing the productivity and competitiveness of Tasmanian industry. It also facilitates access to new markets."
Mr Hodgman said Australia has a robust foreign investment framework to ensure foreign investment benefits the community.
"Any allegation of money laundering is taken extremely seriously, however is ultimately a matter for the Australian Federal Police," he said.
The inquiry will review:
- the protection of Australia's market-based system from manipulation that would benefit proposed foreign investment,
- the assessment of the impact of proposed foreign investment on market concentration and competition,
- the imposition of conditions on foreign investors,
- the extent to which the risk of foreign investment proposals are being used for money laundering,
- the role of the Foreign Investment Review Board, and
- any other related matters.