Air NZ should be re-named Air Asia
Tue Oct 26 1999
Act party deeply involved in thwarting kiwi share
The government has allowed Air New Zealand to fall into foreign control in a way which makes a mockery of 'kiwi-share'
provisions, Alliance leader Jim Anderton says.He says Air New Zealand has lost the moral right to call itself New
Zealand's national flag carrier because it's controlled by Asian-owned BIL.'Air New Zealand should be renamed 'Air Asia'
because it is no longer a New Zealand airline in any meaningful sense,' Jim Anderton said.He has revealed that changes
to Air New Zealand's ownership structure designed to thwart the kiwi share were drafted by the corporate lawyer ranked
Number 3 on the Act party list, Steven Franks.When Air New Zealand was privatised in 1988, the government retained a
'kiwi share' which it claimed would ensure that 65% of the airline remained in New Zealand hands. Over half of Air NZ's
issued shares were made 'A' shares, which have to be New Zealand-owned. But a majority of Air New Zealand's A shares are
now ultimately owned by Brierley Investments Limited (BIL), which also owns a controlling 30% of Air New Zealand's 'B'
shares. BIL is 70% foreign-owned.At the time BIL became foreign-owned, it sought to get around the requirement for 'A'
shares to be kiwi-controlled by placing them in a subsidiary company, BIL NZ Assets. The directors of BIL NZ Assets are
appointed by a so-called charitable trust. The trust and subsidiary company structure was designed by Steven Franks.The
Government has told parliament that it accepts Air NZ is New Zealand owned because 'the Overseas Investment Commission
is satisfied that BIL NZ Assets is suitably 'ring-fenced' from Brierley Investments and is a New Zealand controlled
identity.' But Jim Anderton says the trust is a sham.'When the trust was established Mr Franks told the Overseas
Investment Commission that it would have a charitable purpose and would be a vehicle for BIL's
'philanthropy'.'Investigations by the Alliance show that the trust has never filed accounts as most trusts established
for a charitable purpose would do as a matter of course. 'The charitable trust has never made a pay-out for a charitable
purpose. 'The trustees are all appointed by BIL. They appoint themselves as directors of a subsidiary company which owns
two subsidiary companies that actually hold the shares in Air NZ and determine the votes of the A shares.'The whole
structure is simply a device to subvert the requirement that Air NZ remain in New Zealand hands, but it is nothing more
than a legal fiction.' When Brierley's fell into foreign ownership, it claimed that the trust meant Air New Zealand
complied with the New Zealand ownership requirement. Since the trust is a mirage, Air New Zealand is not a New Zealand
company. It should be renamed Air Asia.'It would be more honest to have the Malaysian rugby team painted on the side of
Air NZ planes, rather than the All Blacks.''New Zealand must be the only developed country in the world whose so-called
national airline is foreign-owned. Most other countries give special access rights to airlines on the basis that they
are national flag carriers. If Air New Zealand is no longer a New Zealand airline, then there must be international
question-marks over its rights under international air transport agreements.'The deal that saw New Zealand's national
airline whipped away from New Zealanders was masterminded by a senior Act Party activist. In government, Act would sell
everything they could get their hands onto overseas, including our hospitals, roads, TVNZ, NZ Post and probably their
own grandmothers.' The foreign ownership webBIL ultimately owns 54.56% of Air NZ A class shares - ordinary shares which
must be held by New Zealanders.158 million Air NZ 'A' shares, or 54.56% of the company are owned by Anafi Investments.
Anafi is a BIL company: It is wholly owned by BIL NZ Assets. BIL NZ Assets is wholly owned by BIL NZ Holdings. The
directors of BIL NZ Assets are appointed by a 'charitable trust.' The trustees are appointed by BIL and appoint
themselves as directors of BIL NZ Assets.BIL NZ Holdings is owned by BIL and Oxmoor Investments. Oxmoor is wholly owned
by Lenville Investments, which in turn is wholly owned by BIL.BIL owns 29.4% of B class shares - ordinary shares15.49%
of B class shares are owned by Urtica Investments.13.92% are owned by Portfolio Management Ltd.Both Urtica and Portfolio
Management Ltd are wholly owned by BIL NZ Holdings.BIL NZ Holdings is owned by BIL and Oxmoor Investments. Oxmoor is
wholly owned by Lenville Investments, which in turn is wholly owned by BIL.Under the 'kiwi share', the government holds
one share which carries no voting rights but allows the government to veto actions of the company including a change of
name, relocation of its head office overseas or the sale of the company's principal business.
ENDS