Penny Wong (SA, Australian Labor Party, Minister for Finance and Deregulation) Share this | Hansard source

I thank Senator Xenophon for the question. I will give him a response and, if there are further issues which I am not able to address in the time frame, I am happy to arrange for a more detailed briefing. First, as a general proposition, he would be aware that foreign investments that are subject to the Foreign Acquisitions and Takeovers Act or the government's foreign investment policy are examined against the national interest. The concept of national interest embodies a number of elements including considerations of issues such as national security, community interests and economic, development, competition and environmental issues.

In terms of the FIRB approval process, the government does not publicly comment or speculate on issues involving any particular foreign investment proposal, not even to comment on whether a specific proposal has been received. This is a longstanding practice of ministers. However, as I understand, the question in part relates to the 49 per cent foreign ownership limit for Australian designated international airlines, which is a specific issue with its own specific rules. I am advised that Virgin's international airlines will be restricted to 49 per cent foreign ownership and the constitution of the new company will contain provisions that require the selldown of foreign interests should they breach the 49 per cent limit.

I am also advised that all Australian companies subject to foreign ownership restrictions are required to comply with ASX rules including to notify the ASX if they come within five per cent of the relevant restriction. If unacceptable ownership of Virgin's international business arises, the government would obviously consider exercising its powers to prevent it. Provisions relating to ownership and control of Virgin are also enforced through the regulatory process such as the system of international airline licences.