Coalition senators want Australian foreign investment rules strengthened amid reports of a plan from China's largest food company to buy a South Australian winery.
COFCO, a Chinese government-owned entity, is set to bid for a Barossa Valley winery and market it under the Great Wall label, News Limited reported on Wednesday.
The Foreign Investment Review Board (FIRB) requires overseas governments and their related entities to apply for approval before making an investment in Australia.
The FIRB also considers whether a sale is in the national interest when it is worth more than $248 million. However NSW Nationals senator Fiona Nash says the national interest test for the sale of Australian land or companies to overseas firms is not strong enough.
Australia's tax system also put local companies at a disadvantage to their international rivals, Senator Nash told reporters in Canberra on Wednesday.
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NSW Liberal senator Bill Heffernan agreed, saying under current tax laws a foreign government investor, "as opposed to a corporate investor" could "bypass the tax system".
"It is time Australia woke up," Senator Heffernan told reporters. Senator Heffernan said the FIRB board should redefine the rules and regulations about foreign investment as Australia was losing revenue under the current system.
Opposition frontbencher Barnaby Joyce said it was not about stopping foreign ownership in Australia.
"It is the role of state-owned enterprises and making sure Australia has proper control over this issue," Senator Joyce said.
The federal government said there is a rigorous national interest test and it welcomes foreign investment because it provides jobs, business opportunities and economic growth.
"Importantly we screen every dollar of direct investment from foreign governments," a spokesman for assistant treasurer David Bradbury said in a statement.
The government announced last October a national foreign ownership register for agricultural land would be established.
The Coalition released a discussion paper last August outlining a plan to reduce the sales threshold at which the FIRB applies a national interest test on transactions from $248 million to $15 million.
