Government clamps down on foreigners buying up New Zealand assets

The Government is clamping down on foreigners buying up New Zealand assets.

Some water bottling companies could be prevented from setting up shop under a new 'national interest' test for foreign investments. The proposed changes could also mean foreigners are prevented from purchasing monopolies.

A Christchurch protest against foreign-owned water bottlers last month was just the latest sign of public anger over water rights.

Associate Finance Minister David Parker is now taking aim at large foreign-owned companies, proposing new checks on foreign ownership on Tuesday - including water assets.

"It does address the issue in respect to water attached to rural land."

But bottlers could still set up in urban centres.

"So there's limited room for us to move," Parker says.

Foreign investors will have to prove their presence in New Zealand is in the national interest. Officials will take into account national security, if assets include water rights and Māori cultural values. 

Other controversial foreign investments include the sale of New Zealand's second-largest dairy co-op, Westland Milk.

Newshub tried to speak to Yili, the Chinese company that wants to purchase Westland Milk for $588 million, but was unsuccessful.

The sale of Westland Milk goes against everything New Zealand First stands for - it thinks it's an erosion of New Zealand ownership.

"After all my years of campaigning, don't ask me that ridiculous question," Winston Peters said when asked if the sale is in the national interest.

The sale will need overseas investment office approval to go ahead.

It's a political powder keg for this Government. Both Labour and New Zealand First have long been opposed to foreigners buying up significant national assets.

These new rules can't stop that sale, but they're hoping it will stop others in the future.