Lawyers involved in conveyancing will be delighted with recommended changes to a bill introducing greater limitations on property purchases by overseas buyers, the New Zealand Law Society says.
The Finance and Expenditure select committee has released its final report on the Overseas Investment Amendment Bill, with a recommendation that the bill be passed with amendments.
“The committee has recommended major changes to a provision which would have placed onerous certification requirements on lawyers,” Law Society Property Law Section chair Duncan Terris says.
“This would have required a lawyer to certify, to the best of their knowledge, that a purchaser would not contravene or commit an offence under the Act. Anyone who failed to comply with that could have been convicted of an offence and fined up to $20,000.”
Mr Terris says the Property Law Section presented a submission to the committee which stated the proposed requirement did not reflect the reality of the majority of residential property sales.
“It’s very common for lawyers to become involved in residential property sales well after the buyers and sellers have entered into a binding contract. The proposed law change would have exposed lawyers to the risk of innocently breaking the law, and this would probably have been reflected in increased conveyancing fees.”
He says the Law Society agrees with the committee’s comment that the burden placed on lawyers in the bill is too high and too subjective.
“The committee has proposed a change which will place the primary responsibility for compliance on the purchaser, who will need to advise the lawyer whether the transaction needs consent under the Act. This is a sensible and realistic change.”