OIO beefs up decision system

Farm land, property owned by Andy Orton and Robyn Orton, Mangatahi Rd, Havelock North, sold for $8m, subject to the OIO Overseas Investment Office. Photo / Duncan Brown

The Overseas Investment Office is taking a harder line in rejecting applications that need more work and has expanded its team in a bid to speed up the process for potential offshore investors.

So far this financial year the office has sent back a quarter of applications to potential investors, saying they didn't meet the required standard, up from 14 per cent in the year ended June 30, 2015, and just 6 per cent the year before that, according to the OIO's website.

Manager Annelies McClure says the office decided to reject more applications that don't stand up, to improve the overall quality and to accelerate the process for those buyers who meet the desired standard.

"We've taken in the past a lighter touch in terms of rejection, but you'll see from our statistics that they've gone up exponentially," McClure said. "We are confident that if we can get these good quality applications in first, we should be able to drive down those timeframes."

At the same time, the OIO is expanding its team to 14 from nine.

The office has been working closely with local law firms to get them on board, particularly those with multiple rejections, to raise the standard of applications before they are lodged, she said.

The OIO aims to assess 90 per cent of applications within a certain timeframe, based on the way it classifies the transaction.

The office is often criticised for the time it takes to process applications, most recently by NZX-listed industrial automation firm Scott Technology over a more than six-month wait for Brazilian meat processor JBS to buy a controlling stake. And ASX-listed Broadspectrum's board cited it earlier this year as a reason its shareholders should reject a takeover offer from Spain's Ferrovial.