This round of questioning occurred in the October/November Hearings of Budget Estimates, focusing on large concerns I had brought to my attention over the sale of CuDeco. FIRB provides recommendations to the Government in relation to the risk of certain foreign investments.
Transcript
Senator ROBERTS: Thank you for appearing today. My questions are with regard to the sale of assets of the delisted stock exchange minor CuDeco Limited. The receivers have claimed on 12 June 2020 that approval had been recommended by FIRB for this. Would FIRB confirm whether or not it recommended that Copper Resources Australia may purchase CuDeco assets, including its major copper mine, on or shortly before that date of 12 June?
Mr Hamilton: Certainly, we’ve been following media articles in relation to CuDeco, which, as you know, entered voluntary administration in July 2019 and, as you said, was delisted from the ASX in February 2020. As you know, we don’t comment on the specifics of individual cases, but we do understand that ASIC has looked into this matter. Questions about some of the concerns that have been raised in the public around allegations of phoenixing by CuDeco should be directed to ASIC.
Senator ROBERTS: Are you aware that this copper mine is reputedly one of the largest in the world—or the copper reserves, sorry?
Mr Hamilton: Senator, I was not aware of that myself.
Senator ROBERTS: Was FIRB aware that Copper Resources Australia was only incorporated on 20 May 2020?
Mr Hamilton: Senator, again, I’m not aware of these details. But, as I said, we would be limited in what we would wish to talk about in a public forum in relation to these entities.
Senator ROBERTS: I’ll just ask the other questions, because they raise important points, and whatever you can answer, you can answer, and whatever you can’t, tell me. Was FIRB aware that Copper Resources Australia is basically a shell company with no significant assets and lacks the funds to buy the firm, and that it had no mining experience or funds of its own to complete such a purchase?
Ms Kelley: I think that’s the matter that we said ASIC was looking into.
Senator ROBERTS: Was there a recommendation made by FIRB?
Mr Hamilton: Personally I’m not aware of that, but we would not comment on that in any case, as we’ve said.
Senator ROBERTS: Is FIRB aware that a change of beneficial ownership form 484 was submitted on 14 July 2020, shortly after the approval was given, assigning the beneficial ownership to Chinese controlled company Dragon Field International Ltd?
Mr Hamilton: I refer you to my previous answer.
Senator ROBERTS: Was FIRB aware that it has been suggested that collusion of the Chinese directors and their actions brought the company into liquidation through fraudulent conduct intended to make the company fail and make it a cheap buy?
Mr Hamilton: I refer you to my previous answer.
Senator ROBERTS: Is FIRB aware that the bid of $30 million from Copper Resources Australia promises to be paid to only non-Australian creditors when an Australian bid of $60 million—double the price—to purchase was declined by the receiver?
Mr Hamilton: Again I refer you to what I said previously.
Senator ROBERTS: Is FIRB aware that, if this purchase is allowed to proceed, Chinese interests will allegedly acquire more than $100 million of Australian assets for less than $30 million, leaving Australian investors and creditors unpaid, with reportedly the plant valued as scrap metal?
Mr Hamilton: Again I refer you to my previous answer.
Senator ROBERTS: Can you explain how this recommendation—if you made that recommendation—could be in Australia’s best interest?
Ms Kelley: We’ve noted in previous hearings that we’re very happy to discuss these sorts of matters in a private hearing. The legislation has particular constraints on us around sharing protected information, but we have previously discussed particulars of certain matters in private hearings with senators. We’re happy to consider making that offer. There is another committee looking at foreign investment. We’ve appeared before them and we anticipate we will appear before them again.
Senator ROBERTS: Could you tell me when that would be?
Ms Kelley: I’m not sure when the next one is, but I think we are scheduled to appear.
Senator ROBERTS: Can my office get a briefing from you at all? Ms Kelley: We can certainly put that to the Treasurer’s office.
Senator ROBERTS: So you’ll get back to my office?
Ms Kelley: We’ll talk to the Treasurer’s office about that.
Senator ROBERTS: And then get back, thank you.
