The New Zealand Law Society has released a new Practice Briefing, Advising overseas persons investing in New Zealand assets.
The briefing is intended to assist lawyers to identify whether their clients may need to obtain overseas investment consent before acquiring New Zealand land or business assets.
Before they invest in significant New Zealand business assets, or acquire certain types of New Zealand land, or fishing quota, overseas persons and entities may need consent under the Overseas Investment Act 2005.
Failure to obtain consent can lead to an investor having to sell their interest or having a transaction cancelled. There may also be criminal consequences or civil penalties.
The briefing notes that overseas persons require consent under the Act before they can acquire interests in sensitive land.
It says there is a common misunderstanding that "sensitive land" requiring consent is just farm land. However, sensitive land includes non-urban land larger than 5 hectares, foreshore and seabed, land larger than 0.2 ha adjoining the foreshore, land larger than 0.4 ha adjoining a lake, park or certain reserves, and land on some islands.