The Overseas Investment (National Interest Test and Other Matters) Amendment Bill passed its Third Reading under urgency on Friday 12 December (during a continuation of the 9 December sitting day when the House went into urgency). While the actual date is yet to be determined, the changes are expected to come into force in the first quarter of 2026.
The Amendment Bill is the coalition government's flagship set of reforms to New Zealand's overseas investment regime, targeted at reducing compliance costs and facilitating timelier decision-making by the Overseas Investment Office. As passed, the Bill in substance delivers on those objectives through the new streamlined national interest test, covered in our June update on the Bill.
However, overseas investors should take note of the following changes that were made to the Bill during its passage through Parliament.
Active Investor visa pathway
Most significant are the changes put forward by Deputy Prime Minister and Associate Finance Minister, the Hon David Seymour, as an amendment to the Bill after being reported back by the Finance and Expenditure Committee. Those changes give effect to the coalition government's decision to allow holders of an Active Investor Plus visa to acquire residential land (or construct a new home) where the purchase price (or construction costs) exceeds NZ$5m.
While the introduction of a clear, less onerous pathway for Active Investor Plus visa-holders will be a welcome addition, investors will still need to navigate a consent process before entering into an unconditional agreement to purchase land.
Changes from the Finance and Expenditure Committee
The Finance and Expenditure Committee also made a number of changes to the Bill during the select committee stage. Most changes were minor and technical, and made in response to issues raised by submitters (including some changes that adopted suggestions made by Buddle Findlay's specialist Overseas Investment team), and include the following:
- The Overseas Investment Office will not be required to have regard to the purpose of the Act when conducting a national interest assessment. Given the Act's multifaceted purpose, the Committee agreed with submitters that the requirement (as introduced) to have regard to the purpose of the Act was likely to be difficult and confusing to apply considering the differing purposes of the Act.
- As introduced, one of the non-mandatory factors for the Overseas Investment Office to consider when undertaking a national interest assessment under section 19C was any "investor risk factors, including character and capability". The Committee deleted the reference to "character and capability", finding the reference to "investor risk factors" would be sufficient in terms of assessing risks to the national interest. Including reference to character and capability would have had the effect of reintroducing a similar standard to that under the existing investor test which is intended to largely be removed as a result of these reforms.
For more information about the reforms, contact one of our specialists.
Co-authored by Hugo Schwarz (Solicitor) and Stephen Jannink (Law Clerk).
