Foss Craig: Securities Legislation Bill — In Committee 
Foss Craig: Securities Legislation Bill — In Committee 
[Volume:634;Page:5478] 
CRAIG FOSS (National—Tukituki) 
: 
 In continuing what we spoke of earlier I look forward to a speech from the Maori Party on this Securities Legislation Bill. I would be interested to hear its members’ thoughts on what was perhaps New Zealand’s earliest—perhaps even founding—piece of securities legislation which of course was the Treaty of Waitangi. So I look forward to 10 minutes on that one as we go through the night. I would also be interested in hearing that party’s opinions—and in fact the opinions of more members on the Labour side—of the securities legislation particularly the takeover side. I notice that members of United Future have obviously been through takeovers with their takeover of various small parties etc. I would be interested in seeing it in that context which is a bit from left field I appreciate but it is always worth looking at issues from the point of view of the other side. 
Takeovers equity markets and financial markets all have to operate in an environment of confidence and total transparency and with a free and full flow of information to all parties concerned—regardless of whether or not they have a stake—and in an environment full of integrity where as earlier speakers have said a handshake is as good as a bond. Yes that has to be backed up by legislation; I think we have 182 pages of legislation here plus two Supplementary Order Papers and plus the amendment that my colleague Pansy Wong is putting together. But confidence transparency and certainty are what financial markets are all about. Commitments must be delivered upon when promises have been made and consideration given. When I spoke earlier I touched on the pledge card. I would be interested to examine that in these circumstances but of course it is outside the realm of this bill. 
New Zealand is part of an international global capital market. We are talking about equity takeovers here and we talk about New Zealand and Australia in particular but we are only 2 percent of the world equity markets—only 2 percent. I find that interesting given that the Taxation (Annual Rates Savings Investment and Miscellaneous Provisions) Bill which is currently before the Finance and Expenditure Committee actually disincentivises New Zealand from going to 98 percent of the world’s equity market and encourages us—in fact essentially gives us a tax incentive—to operate within only 2 percent of the world’s equity market. 
Under this takeovers part of the bill many of those new entities that now have to be KiwiSaver-compliant will also have to deal under the taxation bill as it was prior to the suggestions and the changes the Minister of Finance announced the other day which were thrust upon us. They will also have to deal within the new certainty and the transparency that this bill will give. 
The incoming National Government will of course need robust and strong capital markets. As we are supporting this bill on its way through we will endorse it to help create the parameters we need to help New Zealand grow. The earlier part of the bill touched on insider trading. I realise that we are on to Part 2 now. I think the world has moved on an awful lot. As I mentioned earlier sadly and unfortunately problems will still happen. People will still deal outside the spirit of this legislation. 
I note that the Minister of Commerce and earlier speakers also mentioned that we are getting closer to the Australian examples. We are following its lead perhaps hand in hand around certain law on this issue. Of course being a good Hawke’s Bay MP I make the point that our apples are still not allowed into Australia. Hopefully one day our agricultural markets will follow our business tax law and our commercial law. Interestingly I think this convergence with Australia is a debate that New Zealand is yet to have. Almost every bill that is coming before the Commerce Committee and the Finance and Expenditure Committee touches on a closer economic relation with Australia. Of course we all know about Closer Economic Relations but the back office of New Zealand is starting to resemble another state of Australia. This bill is part of a portfolio of changes that the current Government is bringing through. There is this bill the Reserve Bank of New Zealand Amendment Bill taxation legislation and the Westpac New Zealand Bill that was passed the other night. All of those bills have a common theme of New Zealand getting closer to Australia with convergence of back office legislation etc. On its own I do not have a problem with that. But I do have a problem when that debate is not out in the public arena.