Overseas Investment Law Passed, Slashing Approval Times to Boost Growth

The new law significantly speeds up overseas investment decision-making, with most applications now required to be processed within 15 working days.

Associate Finance Minister David Seymour has welcomed the passage of the Overseas Investment (National Interest Test and Other Matters) Amendment Act, describing it as a major step toward unlocking international investment, lifting productivity, and supporting higher wages for New Zealand workers.

The new law significantly speeds up overseas investment decision-making, with most applications now required to be processed within 15 working days. This represents a substantial reduction from the previous 70-day statutory timeframe under the former “benefit to New Zealand” test. Exceptions will remain for investments involving residential land, farmland, and fishing quota, or where a potential national interest concern is identified.

“New Zealand has been turning away opportunities for growth for too long,” Mr Seymour said. “Having one of the most restrictive foreign investment regimes in the OECD has meant lost opportunities, lower productivity, and stagnant wages. We are fixing that.”

Under the reforms, overseas investments will be screened through a simplified and consolidated national interest test, replacing the existing benefit test and investor test for less sensitive assets. This change allows regulators to triage low-risk transactions more efficiently, while still retaining strong powers to protect New Zealand’s national interest where risks are identified. These powers include the ability to impose conditions on investments or block transactions entirely.

Mr Seymour said international investment plays a critical role in economic growth by providing capital, technology, and expertise that help businesses expand, improve productivity, and create higher-paying jobs.

New Zealand’s productivity challenges were a key driver behind the reforms. Between 2013 and 2023, the country’s capital-to-labour ratio grew by just 0.7 percent annually, compared with 2.2 percent per year in the previous decade. Over the same period, average productivity growth fell sharply from 1.4 percent a year (1993–2013) to just 0.2 percent.

“This slowdown happened because workers haven’t had enough capital behind them,” Mr Seymour said. “International investment helps close that gap.”

The legislation builds on earlier administrative changes introduced last year, when Mr Seymour directed the Overseas Investment Office, administered by Land Information New Zealand (LINZ), to significantly accelerate consent processing. He set an expectation that 80 percent of applications should be processed in half the statutory timeframe.

In the 12 months to 30 November, LINZ exceeded that target. Nearly 82.6 percent of consent applications were processed in half the statutory timeframe, while overall processing times improved by 60 percent, with the average decision time falling from 71 working days to 28 working days. LINZ achieved this by adopting a risk-based approach, recognising that most applications are low risk and do not require lengthy assessment.

Despite the reforms, existing screening rules will remain unchanged for farmland, fishing quota, and most residential land investments, reflecting their strategic and sensitive nature. However, an important change has been made for high-value investor migrants.

The new law allows overseas-based investors holding a New Zealand investor residence visa to purchase or build a home in New Zealand, provided strict criteria are met. Immigration Minister Erica Stanford said the change aligns with the Government’s goal of attracting high-quality investment alongside skills and global connections.

“The Government is focused on smart immigration settings that bring additional investment, skills, and connections to New Zealand,” Ms Stanford said. “If a migrant invests a minimum of $5 million to help grow the economy, passes good character and health requirements, they will now be able to buy or build a home.”

To limit impacts on the housing market, the home must be valued at $5 million or more, placing it among less than one percent of New Zealand homes.

“New investors don’t just bring capital,” Ms Stanford said. “They bring experience, knowledge, and networks that will help drive future economic development. New Zealand is open for business.”