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New Zealand is increasingly seen as an attractive location for international investors.  Recently there has been an influx of people from all over the world seeking to take advantage of the myriad of business and lifestyle opportunities New Zealand offers.  Such people are often particularly drawn to a “non-urban” lifestyle, and seek the solitude of the countryside or the coast.  The sale of these kinds of properties to overseas persons is regulated by the New Zealand government.

The Overseas Investment Act sets out a consent procedure for overseas persons and their associates who wish to invest in “sensitive land” in New Zealand.  The consent will usually impose conditions that require ongoing monitoring by the Overseas Investment Office.

An “overseas person” is:

• A person who is neither a New Zealand citizen nor ordinarily resident in New Zealand
• A company incorporated outside New Zealand
• A company that is 25% or more owned or controlled by an “overseas person”.

If you are an overseas person and are considering purchasing “non-urban” land greater than five hectares in size, land on certain islands, foreshore or seabed, or certain conservation, reserve, historic or heritage land, you will need to apply to the Overseas Investment Office for consent.

There are a number of criteria used by the Overseas Investment Office in assessing whether to grant consent.  These criteria include whether the overseas person:

• has business experience relevant to the purchase
• has a demonstrated financial commitment to the purchase
• is of good character
• is a New Zealand resident or intends to reside in New Zealand permanently
• can show that the purchase will benefit New Zealand and whether that benefit will be substantial and identifiable.

The assessment of “benefit” will also include several criteria, including whether:

• the purchase will create new jobs, allow for the retention of jobs that would otherwise be lost, introduce new technologies or new business skills, increase New Zealand exports, enhance competition, efficiency or productivity in the market and introduce additional investment into New Zealand
• the purchase will put mechanisms in place for the protection of flora, fauna and the environment
• there will be adequate protection for historic heritage and historic places
• walking access for members of the public is provided
• foreshore, seabed, riverbed or lakebed has first been offered for sale to the Crown.
• Although these criteria can seem onerous, the submission of your application by lawyers experienced in the Overseas Investment Act will maximise your opportunity to obtain consent.  Rogers & Rutherford act for a number of overseas persons and can provide you with all of the advice you need concerning the best strategy and presentation for your application.

For further information please contact Steve Rutherford on +64 9 970 2750 or steve@r-r.co.nz.