The consent of the Overseas Investment Office is required for transactions involving sensitive land. The information on this page relates to sensitive land that is not residential.
A transaction will require consent if it results in an “overseas investment in sensitive land”. The definition of sensitive land is complex with the legislation defining sensitive land by several different types of land, each with an area threshold.
Consent is only required if you are an “overseas person” as defined under the Overseas Investment Act 2005. For details, see Do I need consent to invest in New Zealand? or consult a lawyer with significant experience in overseas investments.
A national interest assessment may be applied to transactions involving strategically important businesses or an overseas government investor.
Overseas investments in sensitive land are defined in section 12 of the Act. The two tables that list the types of land and area thresholds for sensitive land are found in Part 1 of Schedule 1 in the Act.
Section 16(1)(a), 16(1)(c), 16(1)(f), and 16(2) set out the criteria for consent for overseas investments in sensitive land that is not residential.
The Overseas Investment Amendment Bill (No 3) was introduced for ‘sensitive adjoining land’ and other changes.
Non-residential sensitive land is determined by the types of land and area thresholds detailed in the legislation. While determining non-residential sensitive land is sometimes straightforward, often significant legal and land expertise is required, particularly if there are any nearby waterways.
In short, non-residential sensitive land includes land of a particular type, such as farm land, that exceeds a particular area threshold. For example, five hectares of farm land is considered sensitive land, but three hectares of the same land is not.
Land is also sensitive if it adjoins land of a particular type and exceeds an area threshold. For example, three hectares of farm land would be considered sensitive if it adjoined a recreation reserve on the edge of a lake.
An interest in sensitive land is a freehold estate or a lease, or any other interest, for a term of 3 years or more, including rights of renewal, and is not an exempted interest.
You will need to read and understand the legislation to determine if non-residential land is sensitive. If in any doubt, the OIO strongly recommends that you consult a lawyer (or other land professional) with significant experience in overseas investments.
Please note that the OIO is not mandated to provide legal advice. While there are a limited number of circumstances in which the OIO may be willing to offer advice (in cases of extreme difficulty or uncertainty, for example), the responsibility remains with the applicant. In cases of genuine doubt, the only safe approach is to seek consent.
Sensitive land researchers should see land types and areas for information about:
- assessing the non-urban status of land
- aggregating areas of land
- exempted interests
- farm land
- land held under the Unit Titles Act 1972
- associated land
- multi-story buildings
- identifying cultural sites, historic places and conservation land.
Land in a class listed as a reserve, a public park, or other sensitive area under section 37
These rules do not apply to transactions entered into after 2 June 2020. The second table in Part 1 of Schedule 1 includes a reference to the regulator’s (the OIO) list of additional properties (PDF 38KB) (attachment below) for which apply to past transactions that required consent if the adjoining land is sensitive.
Applicants for consent to acquire non-residential sensitive land must satisfy a number of criteria. In addition to the core criteria (the investor test), consent will only be granted if either:
- in the case of an individual, the relevant overseas person intends to reside in New Zealand indefinitely (see lifestyle properties and new migrants),
- in the case of a non-individual, all the individuals with control of that overseas person are New Zealand citizens, ordinary New Zealand residents or are intending to reside in New Zealand indefinitely or
- the transaction will, or is likely to, benefit New Zealand (and in some cases, that benefit is substantial and identifiable).
Special land and farm land also have specific consent criteria (see below).
The investor test sets out 12 character and capability factors including convictions resulting in imprisonment, tax evasion, corporate fines, and civil pecuniary penalties. The test is met when an investor establishes none of these factors or, if a factor is established, we can be satisfied that this does not make them unsuitable to own or control a sensitive New Zealand asset.
Benefit to New Zealand
Benefit to New Zealand is measured against a large number of economic and conservation factors listed in section 17 of the Act.
If the relevant land includes non-urban land that exceeds five hectares (either alone or with associated land), the relevant Ministers or the regulator must determine that the benefit will or is likely to be “substantial and identifiable”.
See benefit to New Zealand for more information about the OIO’s approach to the factors.
The offer back of special land is one of the factors under section 17 used to assess if an overseas investment in sensitive land will or is likely to benefit New Zealand. Where applicable, special land (qualifying foreshore, seabed, riverbed or lakebed) must be offered back to the Crown and the Crown must decide whether to accept the offer.
For information about special land and the offer back procedure, see offer back of special land.
Farm land advertising
Farm land must be offered for acquisition on the open market before consent can be granted. The Regulations establish the minimum standards for advertising farm land.
The OIO also requires details about the proposed acquisition, including the nature of the investment, why the acquisition requires consent, and consideration and financing.
Obtaining a sensitive land certificate can help you to assess whether non-residential land is sensitive under the Act. We also require a certificate containing the details of the land involved in any transaction where an application is made, including whether or not you consider the land is sensitive.
Who can produce a certificate?
The certificate should be produced by an experienced land professional with knowledge of the Overseas Investment Act. The land professionals who regularly provide certificates are:
- Grayson Neal Limited
- Port Glen Limited
- The Property Group Limited
- Steven Schwarz
- WSP New Zealand Limited
A number of larger law firms along with LINZ accredited Crown property service providers may also have the knowledge required to produce a certificate.
For transactions entered into prior to the commencement of the Overseas Investment (Urgent Measures) Amendment Act 2020, use: Certificate for the purpose of Schedule 1 of the Overseas Investment Act (Pre June 2020)
For transactions entered into on or after the commencement of the Overseas Investment (Urgent Measures) Amendment Act 2020, use: Certificate for the purpose of Schedule 1 of the Overseas Investment Act 2005 (Post June 2020)
The Minister of Finance and the Minister for Land Information have delegated to the regulator (the OIO) many of the powers to grant consent under the Act. In these delegated cases, the regulator fees apply.
The relevant Ministers generally grant consent where:
- the relevant land is or includes special land, land on other islands, the marine and coastal area or the bed of a lake, or adjoins the marine and coastal area or bed of a lake
- the substantial and identifiable benefits criterion (section 16A(1)(b)) applies.
However, even if the substantial and identifiable criterion applies, decisions will be delegated where:
- the land is leasehold (other than pastoral lease land) or the interest being acquired is an interest as mortgagee or encumbrancee, or
- the only ‘sensitivity’ is that the land is non-urban and more than five hectares.
These tables illustrate the methods for determining sensitive land. Please note these have not yet been updated for the 16 June 2020 changes.
Non-residential land is sensitive if it is or includes a type of land listed in Table 1 and that type exceeds the area threshold.
|Non-urban land||5 ha|
|Land on islands specified in Part 2 of this schedule||0.4 ha|
|Land on other islands (other than North or South Island, but including the islands adjacent to the North or South Island)||0 ha|
|Foreshore or seabed||0 ha|
|Bed of a lake||0.4 ha|
|Land held for conservation purposes under the Conservation Act 1987||0.4 ha|
|Land that a district plan or proposed district plan under the Resource Management Act 1991 provides is to be used as a reserve, as a public park, for recreation purposes, or as open space||0.4 ha|
|Land subject to a heritage order, or a requirement for a heritage order, under the Resource Management Act 1991 or by Heritage New Zealand Pouhere Taonga under the Heritage New Zealand Pouhere Taonga Act 2014||0.4 ha|
|A historic place, historic area, wahi tapu, or wahi tapu area that is registered or for which there is an application or proposal for registration under the Heritage New Zealand Pouhere Taonga Act 2014||0.4 ha|
Land is sensitive if it adjoins a type of land listed in Table 2 and exceeds the area threshold.
|marine and coastal area||0.2 ha|
|bed of a lake||0.4 ha|
|land held for conservation purposes under the Conservation Act 1987 (if that conservation land exceeds 0.4 hectares in area)||0.4 ha|
|any reserve under the Reserves Act 1977 that is administered by the Department of Conservation (if that reserve land exceeds 0.4 hectares in area)||0.4 ha|
|any regional park or part of a regional park that is subject to a declaration under section 139 of the Local Government Act 2002 (if that park or part of the park exceeds 80 hectares)||0.4 ha|
|any national park held under the National Parks Act 1980||0.4 ha|
|land that adjoins the sea or a lake and is a Māori reservation to which section 340 of Te Ture Whenua Maori Act 1993 applies (if that land/reservation exceeds 0.4 hectares in area)||0.4 ha|
|land over 0.4 hectares that includes a wahi tapu or wahi tapu area that is entered on the New Zealand Heritage List/Rārangi Kōrero or for which there is an application that is notified under section 67(4) or 68(4) of the Heritage New Zealand Pouhere Taonga Act 2014||0.4 ha|
|land over 0.4 hectares that is set apart as Māori reservation and that is wahi tapu under section 338 of Te Ture Whenua Maori Act 1993||0.4 ha|
|land (if that land exceeds 0.4 hectares in area) that, pursuant to an enactment specified in Schedule 3 of the Treaty of Waitangi Act 1975 or in regulations,—|
is owned by the governance entity of a collective group of Māori such as an iwi or a hapū; and
is managed in accordance with the Conservation Act 1987 or an enactment referred to in Schedule 1 of that Act
|any reserve under the Reserves Act 1977 (if that reserve exceeds 0.4 hectares in area) that, pursuant to an enactment specified in Schedule 3 of the Treaty of Waitangi Act 1975 or in regulations, is managed wholly or jointly by the governance entity of a collective group of Māori such as an iwi or a hapū||0.4 ha|
|Te Urewera land (as defined in section 7 of the Te Urewera Act 2014)||0.4 ha|
|Whanganui River (as defined in section 7 of the Te Awa Tupua (Whanganui River Claims Settlement) Act 2017)||0.4 ha|
|Maungatautari Mountain Scenic Reserve (as defined in section 71(1) of the Ngāti Koroki Kahukura Claims Settlement Act 2014)||0.4 ha|
This website provides general information only. The OIO and LINZ do not assume any responsibility for giving legal or other professional advice and disclaim any liability arising from the use of the information. If you require legal or other expert advice you should seek assistance from a professional adviser.
The Overseas Investment Office encourages you to seek legal advice about whether your obligations have changed as a result of the Overseas Investment (Urgent Measures) Amendment Act 2020.