$847,000 penalty, a warning to overseas investors
A High Court decision ordering the former owners of an Auckland cliff-top property to pay $847,000 for failing to get consent under the Overseas Investment Act before buying the property, has been welcomed by Land Information New Zealand (LINZ).
LINZ says Wenbing Tang, an overseas person under the Overseas Investment Act purchased the property in 2013 and then transferred it to other overseas people.
LINZ says neither transaction went through the required Overseas Investment Act consent process.
“The High Court Judgment is a timely reminder that overseas people must get consent under the Overseas Investment Act if they want to buy sensitive land in New Zealand. Justice Lang stated that the defendants should have been aware of the restrictions on purchasing property in New Zealand.”
“This is a great example of how the Overseas Investment Office’s enforcement programme is making sure people who should get consent, do so. Getting consent ensures New Zealand benefits from the overseas investment and that promises made by overseas buyers are kept,” says Lisa Barrett, Deputy Chief Executive, Policy and Overseas Investment.
Mr Tang has been penalised $110,000 for his role in the transaction and the further 3 defendants (Xianghua Huang, Binghan Zhou and Binzhi Ouyang) have received a penalty based on the gain they otherwise stood to make from disposing of the property.
The penalties imposed on Xianghua Huang, Binghan Zhou and Binzhi Ouyang included a deduction to recognise their co-operation once proceedings were filed.
“The judgment establishes that where an overseas person stands to make gain from buying sensitive land without consent, any penalty imposed will focus on the gain they make by failing to follow the overseas investment rules,” says Ms Barrett.
Last updated on the 14th March 2018