Friday, March 29, 2024

LIC sheds legal shackles

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Farmer co-operative LIC is being unleashed from legal limits to help it chase its global growth strategy.
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The Ministry for Primary Industries (MPI) said the law will no longer require LIC to provide herd testing nationwide at uniform prices within regions or to need ministerial consent to amend or revoke its constitution regarding shareholding and voting.

LIC will also no longer have to get written ministerial consent before applying to shed its co-operative status.

MPI said the changes followed consultation and a review which found the regulations imposed undue costs on LIC and limited its ability to implement its global growth strategy.

The ministry would be doing further work that could lead to different requirements for the dairy herd improvement industry.

It said new regulations could be put on the industry after next year’s government review of the Dairy Industry Restructuring Act, the legislation governing the $18 billion dairy industry.

While LIC will be free of some regulations, any changes to its constitution and any bid to demutualise would require 75% farmer support, MPI said.

The ministry would retain oversight of LIC’s historical copy of the industry core database and new data collected for three years after the imminent transfer to DairyNZ. During that time MPI would review the panel deciding access to the database.

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