This section contains information about the assessment of the likely benefit to New Zealand arising from the factor relating to additional investment for development purposes.
Will the overseas investment result in, or is it likely to result in, the introduction into New Zealand of additional investment for development purposes (section 17(2)(a)(v))?
Key elements of this factor
There are four key elements to this factor.
- The investment must be additional investment.
- The additional investment must be introduced into New Zealand.
- The additional investment must be for development purposes.
- The additional investment that is likely to result from the overseas investment must be additional to that which is likely to occur without the overseas investment.
Additional investment occurs after the initial purchase and is distinct from the purchase price. Projects or investments that have commenced prior to settlement of the purchase of the overseas investment are unlikely to result from the overseas investment.
Introduced into New Zealand
The additional investment must be introduced into New Zealand. This may include using retained earnings that would otherwise be remitted overseas.
The additional investment must have the effect of increasing the productive capacity of the assets being acquired.
For example, building a new woolshed or new yards on a farm may constitute investment for development purposes. Ongoing maintenance or repairs to an existing woolshed or yards would not usually constitute investment for development purposes.
The building of a residential dwelling for an applicant’s personal use does not constitute additional investment for development purposes.
Making a claim
Provide the following information when making a claim under this factor:
An explanation of the development that the additional investment will be used for (for example, a short description of the new factory that the applicant intends to build). It should also be clear why the additional investment is for development purposes and not ongoing repairs or maintenance.
- Additional Investment:
The budget for or value, in New Zealand dollars, of the additional investment likely to occur with the overseas investment.
How the additional investment will be introduced into New Zealand.
When the additional investment is likely to occur. If the additional investment is to be spread over a particular timeframe, specify the financial years over which the additional investment is to be spent and the amount to be spent in each of those financial years.
The budget for or value of any additional investment that is likely to occur without the overseas investment. For the avoidance of doubt this should include additional investment that is likely to be sourced from within New Zealand and that which is likely to be introduced into New Zealand.
Any precondition that may prevent the delivery of the additional investment (for example, resource consents).
Conditions of consent
All consents are granted subject to conditions. Consent conditions will generally require consent holders to deliver, and report on, the benefits claimed in their application. The OIO monitors all consents to ensure that conditions are complied with.