Associate Finance Minister David Seymour has announced changes to our overseas investment laws to get New Zealand "off the bench" as a competitive destination for international investors.
While the categories of sensitive assets that will be screened are intended to remain the same (sensitive land, significant business assets, strategically important businesses), the core tests are proposed to be consolidated and the default position will be that an investment should proceed unless there is an identified risk to New Zealand's interests.
While the Overseas Investment Act 2005 was simplified in 2021 through changes to the investor test and benefit test, and the Overseas Investment Office has worked to streamline its assessment processes since Minister Seymour's June Ministerial Directive to (in essence) go faster, the change to the default position is more fundamental, and in our view would be the most significant change of the past two decades in terms of how investments are screened.
Detailed reform proposals will be developed through 2025, with the goal to pass legislation before the end of next year. We will be keeping a close eye on these developments, as will overseas investors and others interested in whether the changes will not only get New Zealand off the bench, but to being a consistent presence in the starting lineup.
This article was co-authored by Susie Kilty (partner), Hannah Lee (senior associate), Emily Tyler (senior solicitor) and Georgia Callaghan (solicitor).
