Find out what the investor test is, who needs to meet it, and how it is assessed.

Purpose of the investor test

The purpose of the investor test is to determine whether investors are not unsuitable to own or control sensitive New Zealand assets. The investor test forms part of the assessment of most consent applications.

What the test includes

The investor test sets out the types of behaviour and history we consider show that the overseas investor is likely to pose a risk to New Zealand. It is made up of 2 groups of factors: character and capability.

The character factors include:

  • convictions resulting in imprisonment or significant fines
  • corporate fines both in New Zealand and overseas
  • being ineligible to come to New Zealand.

The capability factors include:

  • prohibitions on being a director, promotor, or manager of a company
  • penalties for tax avoidance or evasion
  • unpaid tax of $5 million or more.

Investor test factors are detailed in section 18A of the Overseas Investment Act 2005.

Overseas Investment Act 2005, section 18A

Assessment criteria

When you apply for consent, you will be asked if any of the investor test factors are established. If you answer ‘Yes’ to any factor, you will need to provide details of what this was and sufficient evidence to show why this does not make you unsuitable to own or control sensitive New Zealand assets. We will consider the event or behaviour in the context in which the situation occurred and your actions afterwards, based on the information you provide and our own investigations.

You will meet the test if either:

  • none of the investor test factors are established, or
  • one or more of the investor test factors are established, but the decision-maker is satisfied that this does not make you unsuitable to own or control sensitive New Zealand assets.

Who needs to meet the investor test

The relevant overseas person (ROP) and all individuals with control of the relevant overseas person (IWCs) must meet the investor test. We decide who the ROP and/or IWCs are for each application.

People who are not overseas persons do not need to meet the investor test.

Relevant overseas person and individuals with control

Overseas person definition

Repeat investors and standalone investor approval

If you have previously met the investor test and your circumstances have not changed, then the investor test component of your consent application will not need to be reassessed. As a result, your application fee will be lower, and the assessment process may be shorter.

Fees and penalties

You have already met the investor test if you have:

  • been granted consent following an application lodged with us on or after 22 March 2021, or
  • met the standalone investor test.

Standalone investor test

Changes in circumstances

If you make a consent application after you have met the investor test you will be asked if there have been any changes since your previous approval. There are 2 situations in which the investor test component of a consent application may need to be revisited.

  • Any of the people or entities we identify as ROPs and or IWCs in your consent application have not previously met the investor test. In this case, the new persons will be assessed against investor test criteria.
  • Any of the persons included in your consent application have established any of the 12 investor test factors since last meeting the investor test. In this case, they will need to satisfy the decision-maker that the event or behaviour does not make them unsuitable to own or control sensitive New Zealand assets. Again, we will consider the event or behaviour in the context in which the situation occurred and the actions taken afterwards, based on the information provided and our own investigations.
Last Updated: 5 July 2021