The Overseas Investment (National Interest Test and Other Matters) Amendment Bill was passed by Parliament on Friday marking a significant shift in New Zealand's foreign investment framework. It is expected to receive Royal Assent later this week, meaning it will come into force in mid to late April 2026.

To recap, this will mean that:

• significant business assets transactions will only be subject to the national interest assessment, a new streamlined 15 working day process, and consent must be granted if the national interest test is met and the transaction is not contrary to the national interest;
• land applications will remain subject to the investor test (to show that the investor has the appropriate character and capability) but no benefit submissions will be required for sensitive land (other than for farm land, residential land and, as commented on further below, acquisitions of mixed land types) and, instead, the national interest assessment will apply.

Since we reported on the Bill here (New Zealand is open for business - NZ Government introduces major scaling down of foreign direct investment requirements), there have been a few key changes:

• The OIO does not need to have regard to the purpose of the Act when carrying out a national interest assessment. This is because of the difficulty in applying the new dual purposes of the Act which are to acknowledge that it is a privilege for overseas persons to own or control sensitive New Zealand assets but also to recognise the role of overseas investment in increasing economic opportunity.
• Where land is both residential and otherwise sensitive (which is not uncommon), applicants will not be able to rely on the new streamlined national interest assessment will instead have to go through the benefit to New Zealand test (or the commitment to reside test, which will not be applicable to most investors). This requirement will not apply where land includes residential land but is to be used exclusively or nearly exclusively for forestry activities. Those investors will be able to rely on the new national interest assessment, we assume with conditions around residential land use as imposed currently under the special forestry test.
• Holders of the Investor Plus (formerly Active Investor Plus) visa can now acquire an existing residential property, or construct/renovate one over a value/cost of $5 million, under the national interest assessment. The timing for any works will be manged through conditions, although there is no indication at this stage of how long will be permitted for works to be undertaken. This does carry the risk of overseas persons acquiring lower-value land on the promise of extensive building works but not ever undertaking those works and then requiring the OIO to undertake enforcement action in the event of breach.

What we don’t yet know is the detail of the application forms or the fees that will be charged for these changed applications. We understand that a comprehensive review of the fees for all applications will be imposed via regulations before the Bill comes into effect.

Given the new tests will result in significant time savings for many investors, it will be important to consider the timing for filing any application for consent. The regime applicable will depend on the timing of submission of the application.

In Simpson Grierson’s seventh annual Expanding Horizons M&A Report where the firm surveyed 90 international investors who have recently invested in New Zealand, a striking 89% of respondents indicated that reform of the Overseas Investment Act will increase their investment intentions into NZ. Read our full report here. 

Get in touch

If you would like to discuss transaction timing, the implications of the Bill for you generally, or any other aspect of New Zealand’s foreign investment regime, please get in touch with one of our experts.