Foreign investment rules to be eased, says Govt

New Zealand's banking sector is dominated by overseas ownership. Photo/Herald on Sunday.

The Government has simplified overseas investment rules and is looking to ease up other restrictions, Finance Minister Bill English said today.

The changes are the first part of a two-part review, with the second part focusing on changes to the Overseas Investment Act itself.

Under the changes ministers have delegated greater decision-making powers to the Overseas Investment Office, which will be able to decide all applications barring rural sensitive land or land adjoining waterways.

The changes take effect immediately.

English said 98 per cent of all applications were approved anyway and the move would speed up approvals and cut red tape.

In addition, several types of transactions of a minor, technical or temporary nature have been exempted from the Act.

These include some underwriting transactions and sales within a group of companies with shared ownership.

In the next few weeks the Government is to consider the second part of the review, aimed at three main areas of the Act. Issues include:

* Whether the thresholds determining which land and business investments are screened are set at the right level -- so only genuinely sensitive assets are captured.

* Providing greater certainty for investors, by removing the ability to substantially change overseas investment rules during applications.

* Simplifying the screening of investments in sensitive land, while ensuring that overseas investors are subject to a higher standard than domestic investors.

-NZPA