This article is from the Australian Property Journal archive
TREASURER Scott Morrison has given the greenlight for Chinese owned Moon Lake Investments to acquire the land and assets of the Tasmanian Land Company (TLC) from the New Plymouth District Council (NPDC), in a deal worth in excess of $250 million.
The TLC include the Van Diemen’s Land Company.
Morrison said Moon Lake’s bid was the first application to be subject to new conditions requiring it to comply with Australian taxation law.
“In forming my view I have carefully considered the national interest test and how it applies to this case, including the likely impact on local jobs and increased investment to support economic growth.
“The national interest test also considers a range of factors, including national security, the impact on competition, the character of the investor, and the impact on the economy and the community,” Morrison said.
“In particular, the national interest test requires consideration of the impact on taxation revenue.
“As a result, approval for Moon Lake’s foreign investment application is the first to be subject to new conditions requiring it to comply with Australian taxation law, Australian Taxation Office (ATO) directions to provide information in relation to the investment and to advise the ATO if it enters into any transactions with non-residents to which the transfer pricing or anti-avoidance measures of the tax law may potentially apply.
“A breach of these conditions could result in prosecution, fines and potentially divestment of the asset,” he added.
As part of the agreement, Moon Lake have given guarantees that all current VDL employees will be offered ongoing employment on terms no less favourable than their current employment arrangements.
Moon Lake has also committed to undertake a number of investment projects in the VDL farms, and based upon Moon Lake’s estimates will result in a near doubling of employment at VDL. This will guarantee more than 140 local jobs, generate an intended additional investment of over $100 million and an expected additional 95 jobs.
Moon Lake has advised that it intends to continue to supply the milk produced at VDL under the same contractual terms are currently in place.
“Given these considerations, I am satisfied that the Moon Lake proposal to purchase TLC is not contrary to the national interest. It will ensure increased employment and investment in an important industry sector in Tasmania, while the safeguards we have put in place will ensure they pay their tax,” Morrison concluded.
Australian Property Journal
