MACQUARIE NETWORK WEEKLY BROADCAST
BY THE PRI111 MINISTER4 THE RT. HON.
WILLIAM McMAHON, CH, MP.
OVERSEAS INVESTMENT IN AUSTRALIA 27 SEPTEMBER 1972
Interviewer Paul Lynch
Q. Prime Minister, there has been much agitation in
Australia, of course, over the last year about foreign
takeovers. It has been suggested that some of the takeovers
of the past year have not been in the interests of this country.
Do you feel that that is so?
PM: Many of them, in my opinion, have not been in the best
interests of Australia, or perhaps I could put it differently.
Attempts, in many cases, have not been in the interests of
Australia. And I personally intervened in those cases to fire
a shot across their bows to stop the takeovers taking place
until I was able to introduce legislation into the House.
Q. Which cases would they have been, Prime Minister?
PM: Well I mentioned them before and it created a bit of a
furore, but I didn't like the idea of , e International Telegraph
and Telephone Company taking over Fresh Foods. That was one
example. And while they might not have been directly influenced
by political consieeratons, they must in some respects have been
influenced by them and the takeover didn't take place.
Q. Now, with the announcement of this new Board, this
independent Board, hiow exactly would a foreign company wanting
to take over an Australian company have to approach it to the
Board?
PM: First, the company attempting to make the takeover could
notify the Goverr: ient, or could notify its intention publicly.
As soon as that w.-is done, we would refer the matter to the
independent authority and we would give them a timetable within
which they would have to make r commendations to the Government.
They would make their report and the Government would then decide
what action it should take, either to prevent the takeover
completely or tD take some other kind of remedial action. Until
the act is passed and we have 3stablished this independent
authority, the Government will do exactly the same as the
independent aut: hority would do, but this occasion we would
be advised by a: i interdepartmei. tal committee. / 2
Q. As '-understand it, Prime-Minister, you do not fntend
to stop all foreign -takeovers. Youhave to chart a course
between the ones which you think are acceptable gxthe ones
which you think are not acceptable. How wil-ou chart that
course?
PM: That is correct. Your statement is correct. But it is
a kind of a syncopation of what we have-done. We have set out
guidelines and there are about ten of them that have to be
complied with. If they are not in the public interest,
manifestly not in the public interest, and there are other
qualifications that cannot be met, then we will prevent the
takeover. But if it is felt that the qualificatins can be
met, a recommendation can be made accordingly, and we will
look at it and it will be for the Government to make the
final decision.
Q. Sir, you as Prime Minister, and Prime Ministers over the
last few years have said that the inflow of foreign investment
capital into Australia, in some cases takeover capital, is a
good thing. Do you still feel this?
PM: Yes, I do, because circumstances can change so quickly.
At the moment we don't need large amounts of overseas capital
in the way we needed it say, two, three, four, five years ago.
But you can never tell when circumstances will change again
and we may need it again. Under present circumstances, we
would like, if we think it is in the nation's intzrosts, to
reduce the quantity of the flow into Australia and we are
attempting to do sc.
Q. Sir, do you feel that any takeovers that there have been
in the last few years, without n. aming n. ms, are takeovers
which have damaged Australia?
PM: I couldn't say " damaged" in an economic sense, because
they have brought know-how, and they have permitted the
Australians who have been the investors in the taken-over
company to be able to invest their money somewhere else. But
I don't think that is the point today. The point today is
that we have an abundance of overseas reserves and, much more
importantly, Australians want to own Australian companies and
they want an increasing share of ownership in overseas
cornorations. I think it is this attitude of Australianism
that is of vital importance to us now.
Q. Sir, can you see a situation in % hich you might in the
future adopt a practice or the board might adopt a practice
which has been recommended by various authorities which would
be that foreign comipanies would be allowed to buy in to Australia
but they would not be allowed to control what they buy in?
PM: Yes, we would have no exception to them buying in, and
in fact, the law will provide that they can have a shareholding
of up to 15 per cent without it being regarded as a takeover.
Or, if there are a number of corporations involved, they could
have up to 40 per cent without it being regarded as a takeover.
So we are not excluding them completely and for all time.
We will set out in the legislation the conditions under which
they can have a shareholding in Australian companies.
Q. Prime Minister, thank you very much.