The Directive Letter provides guidance as to the benefit factors that are considered to be of higher relative importance when assessing applications to acquire rural land or forest land.

Rural land directive

The Government has acknowledged, through the Directive Letter, that the primary sector and the rural land it is based on, forms an important part of the New Zealand economy. The privilege associated with the ownership or control of rural land is greater than for urban land, as evidenced by the higher benefit threshold of substantial and identifiable. The Government is therefore concerned to ensure that the benefits from overseas investments in rural land are genuinely substantial and identifiable.

Rural land is land that is non-urban and over five hectares in size (excluding any associated land).  However it does not include land where the existing principal use of the land is forestry. 

The Minister has directed the OIO that the following factors will generally be of high relative importance for overseas investments in rural land:

  1. The ‘jobs’ factor (section 17(2)(a)(i))
  2. The ‘new technology or business skills’ factor (section 17(2)(a)(ii))
  3. The ‘increased exports’ factor (section 17 (2)(a)(iii))
  4. The ‘increased processing of primary products’ factor (section 17(2)(a)(vi))
  5. The ‘oversight and participation by New Zealanders’ factor (regulation 28(j))

There may be circumstances where it is not appropriate to apply the rural land directive, such as where the overseas investment involves minor changes in shareholdings.

Forest land directive

Forest land is any land that is non-urban and over five hectares in size (excluding any associated land) where the existing principle use of the land is forestry. The Government recognises that overseas investment in the forestry sector, and the associated downstream processing industries, has the potential to add significant value to the overall economy and the environment. A separate directive has been given to the OIO in regard to forest land.

The Minister has directed the OIO that the following factors will generally be of high relative importance for overseas investments in forest land:

  1. the ‘increased processing of primary products’ factor (section 17(2)(a)(vi))
  2. the ‘advance significant government policy or strategy’ factor (regulation 28(f))

Specific conditions of consent are likely to be imposed on overseas investors whose investment plan involves processing in New Zealand. Conditions of consent may also be imposed for longer periods as forestry investments are often long-term in nature.

There may be circumstances where it is not appropriate to apply the forest land directive, such as where the overseas investment involves minor changes in shareholdings.

View the Directive Letter

Learn more about investing in forestry

Last Updated: 3 December 2018