RESIDENCE FOR INVESTORS
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New Zealand is an open, market-oriented economy with a stable political system. As New Zealanders we pride ourselves on being honest and hard working and we value ease and simplicity in doing business. Over the last two decades, successive governments have made investing in and trading with New Zealand more and more transparent and attractive.
Here are just some of the factors that make New Zealand a sound investment:
New Zealanders are renowned for innovation and flexibility - two things which play a central part in our national psyche. The term “Kiwi ingenuity” often describes the New Zealand approach to business. Here’s how The Economist magazine recently described New Zealand:
“New Zealand, despite its geographical isolation, has turned itself into an entrepreneurial powerhouse, leading the world in the creation of small and medium-sized enterprises, thanks in part to enlightened government policies.”
Over the last few decades, New Zealand has transformed itself from one of the world’s most regulated economies into one of the most free. American libertarian Professor Floy Lilley, an attorney and adjunct faculty member of the Mises Institute, says New Zealand sets an example that debt-ridden countries like the USA could follow:
“Each of us crippled by debt has a thing or two hundred to learn from the small country down under that did the impossible – New Zealand trimmed the size of its coercive, regulating, and taxing government and not only lived to tell about it, but flourished. While we have been fattening into the most engorged leviathan state on the planet, New Zealand slimmed down on a healthy diet of fiscal restraint in the mid-1980s. In short order, New Zealand threw out the parasites and opened the wide door of opportunity for producers and entrepreneurs to create wealth and raise the standard of living for all.”
Fewer restrictions on foreign investment
New Zealand's regulations monitoring foreign investment are liberal by international standards. There are no restrictions on the movement of funds into or out of New Zealand, or on repatriation of profits, and no additional performance measures imposed on foreign-owned enterprises.
Foreign investment in New Zealand is monitored by the Overseas Investment Act. A full review of this Act is currently underway, aiming to make foreign investment even simpler and more attractive, and to produce a more streamlined process that allows faster decisions. However the review also promises to ensure that land of particular significance or importance to New Zealand continues to be protected. Overseas investments are screened by the Government and will require consent only if they are categorised as “sensitive”.
A simple, investor-friendly tax system
There are many aspects of New Zealand’s taxation system that make our country an attractive place to invest.
New Zealand’s Migrant Investment Policy offers a fast route to New Zealand permanent residence for investors. Investors can secure permanent residence in one of two ways:
This could be the category for you if you are aged 65 years or under, have at least 3 years of business experience and invest NZ$1.5 million in New Zealand for 4 years, as well as show that you have NZ$1 million as personal “settlement” funds for you and your family. Only a low level of English language ability (an IELTS score of 3.0) is required. Everyone included in your residence application must meet Immigration New Zealand health, character, and English language requirements.
Immigration requirements around the location and source of your investment funds are quite stringent. You will need to be able to provide evidence showing that your nominated investment and settlement funds and/or assets are owned either by you or jointly by you and your partner and/or dependent children. The funds must also be unencumbered and have been earned or acquired legally, and must be transferable through the banking system.
The Investor 2 category is a two-step process. To start the ball rolling, you will need to submit an “Expression of Interest” (EOI) to Immigration New Zealand. Selections of EOIs occur each fortnight with a maximum of 300 residence applications permitted each year. Once your residence application is approved in principle, you will then be given 12 months to transfer your nominated investment funds to New Zealand and place them in an acceptable investment. To be acceptable, the investment must be either equity in New Zealand firms (public or private including managed funds); bonds issued by the New Zealand government or local authorities; bonds issued by New Zealand firms traded on the New Zealand Debt Securities Market (NZDX); or bonds issued by New Zealand firms with at least a BBB- or equivalent rating from internationally recognised credit rating agencies (for example, Standard and Poor's). Funds may be invested in commercial but not in residential property development.
Once your residence is finally approved, you will then need to retain your investment funds in an acceptable investment(s) for four years, and spend at least 146 days each year in New Zealand in years two, three and four of your four-year investment period.
If you would like to set up, or invest in, and work in, your own business in New Zealand, you can find out more about these options at www.investmentnow.govt.nz
Contact us to find out more about gaining fast-tracked residence under this exciting investment category.
If you have investment funds totalling NZ$10 million or more, the requirements of the Investor Plus category are even more accommodating. Under this category there are no age requirements, business experience requirements or English language requirements at all. You will only need to invest in New Zealand for a maximum of 3 years and spend only 73 days in New Zealand per year in the second and third years of that period.
Contact us for advice on securing permanent residence under the Investor Plus category.
For more information on New Zealand’s performance in the World Bank’s Doing Business in 2010 report, click here. Also, check out the New Zealand Trade and Enterprise Invest in New Zealand website, which connects international investors with investment opportunities in New Zealand.
The following websites are helpful:
Invest in New Zealand
The Securities Commission, an independent crown entity of the New Zealand government and New Zealand's main regulator of investments.