The site in Tahingamanu Rd, Hobsonville Point, was the subject of an application to the Overseas Investment Office. Photo / Google Street View
The site in Tahingamanu Rd, Hobsonville Point, was the subject of an application to the Overseas Investment Office. Photo / Google Street View
A 4ha Hobsonville Point site has been sold by one Hong Kong investor to another in a $9.2 million trade approved retrospectively by the Overseas Investment Office.
Sanvi Properties, 80% owned by Hong Kong’s Sanco Trading, owns the land at Tahingamanu Rd in the newly created suburb in Auckland’s northwest.
The site is undeveloped, the decision says, but it is planned to be a 120-home subdivision.
Naiyu Wang and Ching Ip Ko, of Hong Kong, sold the land to Ho Ng via shares in Sanvi Propeties, the decision says.
But Ho Ng had not sought consent via the official channels, so needed approval in hindsight, which is allowed.
“This was a retrospective application as consent was not obtained prior to the transaction occurring due to the applicant not being aware the land interests had become sensitive at the time that further shares in Sanco were acquired,” the decision says.
The transaction was self-reported to Toitū Te Whenua-Land Information New Zealand (Linz) and retrospective consent was considered to be appropriate given the inadvertent nature of the breach.
Retrospective consent was granted because Ho Ng met the investor test criterion and the investment was likely to result in an increased housing outcome.
The land was deemed sensitive because it was zoned residential.
Only Singaporeans and Australians can buy New Zealand residential land without seeking Overseas Investment Office approval.
So, although the value was only $9,238,000, consent had to be given.
Associate Finance Minister David Seymour wants the law on overseas investors liberalised. Photo / George Heard
In June, Associate Finance Minister David Seymour issued a ministerial directive to the OIO to speed up consent timeframes and minimise the compliance burdens.
In October, the Government announced plans to liberalise the Overseas Investment Act after Cabinet agreed.
Changes are:
Retaining the scope of what we now screen, including farmland, so the Government keeps the legal option of screening all investments;
Fast-tracking the assessment process with the starting assumption that deals can proceed unless there are risk factors identified, by consolidating the act’s core tests;
Providing the Government with flexibility to call in these investments for detailed scrutiny case by case and impose conditions or block the investment where there are risks to the national interest.
Treasury is leading work on the reforms, with operational support and advice from Linz.
Detailed proposals are now being developed, to pass a law change before the end of this year.
Seymour said on October 12: “Cabinet has agreed to the principles for reforming our overseas investment law.
“At the core of these principles is reversing the presumption that investing in New Zealand is a privilege and that investors must justify their transaction to the Government. The new starting point is that investment can proceed unless there is an identified risk to New Zealand’s interests.”
Commentary from Bell Gully said the Government continued to signal that overseas investors were welcome.
“We expect to be actively involved in the reforms and will advocate for sensible legislative changes to alleviate many of the pain points currently faced by overseas investors needing consent,” Bell Gully’s specialists said.
Seymour said nearly every other developed country had less-obstructive laws than New Zealand.
He said those countries benefited from the flow of money and the ideas that came with overseas investment.
“Attracting more overseas investment is a vital part of the Government’s economic strategy. The decisions Cabinet has taken will ensure that New Zealand is a player once again, instead of sitting on the bench,” Seymour said.
