The New Zealand Herald yesterday reported that Key is considering introducing a Private Members Bill to Parliament amending the 1993 Takeovers Act, to ensure New Zealand and overseas investors are treated equally and that companies have stronger grounds to appeal panel rulings.

At present companies can only appeal a panel ruling under the act by questioning the process that led to the ruling rather than question the ruling itself.

The panel recently blocked Auckland networks company Vector’s bid to buy AGL’s NZ holding company that owns 64.2% of NGC; while earlier this year it allowed Origin Energy to do a similar thing in gaining Edison Mission Energy’s controlling stake of Contact Energy.

Many in the industry have also criticised the panel’s “preferential treatment” of foreign Powerco shareholders, which saw a flood of Powerco shares to overseas registered addresses, through it granting Prime Infrastructure an exemption allowing Prime to pay cash only to foreign Powerco shareholders, but a mix of cash and bonds to local registered shareholders.

Key said the panel appeared "gun shy" following criticism by Finance Minister Michael Cullen over the Powerco ruling and its subsequent Vector ruling. Cullen reluctantly approved the Powerco deal but described some aspects of it as a shambles.

However, panel chairman John King says there is nothing wrong with either the Takeovers Code or Takeovers Act. The panel had expected to deal with a “miniscule” number of offshore Powerco shareholders and not investors exploiting the situation by registering overseas to receive cash only. "We will make sure it doesn't happen again."

King said Cullen's criticism was aimed at Powerco sellers rather than his panel.