Restrictions eased on sensitive forestry investments
Investments in sensitive land involving forestry rights will be brought into the scope of the Overseas Investment Act under changes proposed this week by Associate Finance Minister David Parker.
The changes introduce a light-handed “checklist” screening regime, which will make it easier for overseas investors to gain approval to buy forestry rights than if they were subject to the current screening regime.
Overseas buyers of existing freehold and leasehold forestry land, who already face screening, would also be able to use the light-handed checklist.
Currently, any forest can in effect be purchased as a forestry registration right. This means that a screening regime that covers only freehold and leasehold is ineffective, says Minister Parker.
Under the proposed changes investors buying up to 1000 hectares of forestry rights each year will not need consent, but purchases above that level would be screened. This would apply to all forestry rights, including bare land planting.
New Zealand’s forestry sector is reliant on overseas investment. Currently, 70 per cent of plantation trees is in overseas ownership.
The amendments have been submitted to the Finance and Expenditure Select Committee. The Government will also be consulting further with Māori.
Minister Parker says the changes need to be made before the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP) comes into force, “or [New Zealand] will lose the chance to screen such sales forever”.
More information, including the draft regulations, can be found at: