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Investor Visas NZ: What Are Acceptable Investments?

NZ Investor Visas requirements promote migrants to invest directly in the economy and fund Kiwi companies. Read Immigration NZ’s acceptable investments here.
October 19, 2022
|
5
 min read
Investor Visa Acceptable Investment | Malcolm Pacific Immigration

New Zealand is a desirable country for migrants to invest in due to its stable political structure, innovative approach to business, and overall quality of life.

The Government is actively seeking successful entrepreneurs, business people and investors willing to invest in the New Zealand economy.

There is a wide range of NZ investor migrant visa options. However, they need to meet specific investment obligations and requirements.

What Is the New Active Investor Plus Visa (AIPV)?

Acceptable investments carry different weightings towards the Active Investor Plus Visa's new guidelines with an increase to the threshold, now at NZ$15 million. Migrant investors can invest across a combination of different investment types.

Immigration New Zealand opened the Active Investor Plus Visa category on 19 September 2022. This visa attracts experienced, high-value investors to help build globally successful Kiwi businesses.

AIPV Acceptable Investments

Four eligible investment classes both direct and indirect. They carry different weightings towards the NZ$15 million investment threshold. Investors may be able to invest across a combination to meet the threshold.

Is There a Difference Between Direct & Indirect Investments?

When a migrant makes a direct investment, they put money into one or more specific New Zealand businesses. 

When a migrant makes an indirect investment, they put money into a managed fund or venture capital fund, which then makes investments in NZ businesses. It can also take the form of investments made through the purchase of shares, or securities investment funds, in which migrant investors don't actively manage their investments.

Direct Investments

  • Listed equities that are considered an acceptable investment as set out in Immigration New Zealand instructions, reference BN7.10.1(a), as a wholesale investor.
  • An equity security in an investee entity.
  • A financial product will be converted or may become convertible into an equity security in an investee entity.

As part of the conditions, the NZTE must confirm that either the applicant is investing in acceptable listed equities that were pre-approved by NZTE before funds were invested or that the investee entity is an acceptable direct investment. 

Direct investments into private businesses receive the highest weighting (3x). For example, you can meet the required amount by investing NZ$5 million into direct investments.

Managed Funds

Investments in managed funds are acceptable when they meet either:

  • The managed investment products issued by a managed investment scheme which is on the acceptable managed fund list maintained by NZTE.
  • A discretionary investment management service on the acceptable managed fund list maintained by NZTE.

Investments in managed funds such as private equity or venture capital are upweighted (2x). For example, you can meet the required amount by investing NZ$7.5 million into private funds.

Contact our specialist Investor team for licensed immigration advice to help you understand your AIPV investment options.

Philanthropy

Acceptable philanthropic investments must be registered charities with at least two years of annual returns and have an approved donee status from Inland Revenue which has not ceased.

Investments in philanthropy receive no additional weighting. However, it is capped at 50% of the NZ$15 million investment requirement. For example, you can meet the required amount by putting NZ$7.5 million into eligible philanthropic causes and NZ$7.5 million into listed equities.

Listed Equities

For an investment in listed equities to be considered acceptable, the funds must be invested directly or through an exchange-traded or managed fund. An exchange-traded or managed fund must be handled by someone that is licensed by the Financial Markets Authority to provide that service in the equities of a New Zealand resident entity that:

  • Are listed by a market operator licensed by the Financial Markets Authority.
  • Are offered through a crowdfunding provider licensed by the Financial Markets Authority.
  • Is not engaged in the acquisition, ownership, leasing, management, and operation of commercial or residential property development except if the below applies.

Equities in entities engaged in managing property assets may be counted towards the principal applicant's investment in listed equities, provided they comprise no more than 20 per cent of the value of the total assets held by the fund.

Investments into listed equities receive no additional weighting. However, they are also capped at 50% of the NZ$15 million investment requirement. For example, you can meet the required amount by putting NZ$7.5 million into listed equities and NZ$7.5 million into eligible philanthropic causes.

Investments That Can Not Be Included

Bonds and Property are not considered an acceptable investment. However, INZ has noted that as part of listed equity investments, AIPV holders can invest in exchange-traded funds or managed funds that own companies engaged in the acquisition, development, ownership, leasing, management, and operation of property assets as long as it accounts for only 20% of the investment.

Changes In Your Acceptable Investments

Acceptable investments can be changed during the investment period in some circumstances. 

An investment may become ineligible during the investment period. For example, if a company goes out of business and ceases operations. In this case, contact Malcolm Pacific Immigration today, and we'll work with you and NZTE to ensure your investment continues to be acceptable.

Do You Need to Have All the Money at the Time of Application?

After an application is approved in principle, applicants have six months to make a minimum initial investment and invest the remainder of the funds into holding or other acceptable investments. The total value of the investments must be at least NZ$15 million or the weighted equivalent. The acceptable holding investments are:

  • Bonds issued by the New Zealand government or a local authority.
  • A term deposit with a New Zealand-registered bank.
  • Deposits in a New Zealand registered bank.

Funds invested in a holding investment must be in the applicant's name, remain separate from any other funds and are not for personal use. They should only be withdrawn to make an acceptable investment.

Is There Another NZ Investor Resident Visa Option?

There is a range of other visas that allow you to start a business or get involved in the entrepreneurial environment in New Zealand. You can read more about NZ investor visa pathways here. However, here we discuss the parent retirement visa, which includes investment requirements and can lead to residency, much like the AIPV.

Learn about the changing NZ Investor Visa requirements for residency here.

Investment Under the Parent Retirement Visa

The NZ parent retirement visa enables parents to join their adult children in New Zealand. To be eligible, applicants must meet INZ's financial requirements of keeping at least NZ$1 million invested in an acceptable investment in New Zealand for four years.

While allowing migrant parents to live, work and study in New Zealand, it also allows them to apply for permanent residence after four years of keeping their funds invested in New Zealand.

Parent Retirement Visa Acceptable Investments

Beyond New Zealand's standard acceptable investments, as listed at the beginning of this article, the Parent Retirement visa is unique in that it considers a residential property development to be an acceptable investment. 

However, it must be a new development, not a renovation or extension to an existing residential property, and have the necessary approvals and consents. Furthermore, it must be to make a commercial return on the open market – it must not be for the applicant or the applicant's family or friends to live in.

Parent Retirement Visa Acceptable Investments Changes

Loss in investment value can happen. If an investment decreases in value below INZ's required investment level, the applicant does not need to invest more to top it up.

Applicants may want to reinvest part of their acceptable investment. In the case of selling investments during the investment period, the principle and any capital gains must be reinvested. However, applicants can reinvest part of their acceptable investments into other business ventures or expansions.

What Investor Visas Are Being Discontinued?

The new Active Investor Plus visa category replaced two existing categories, Investor 1 and Investor 2 visas, that have been running for over 12 years. These visas closed to new applications on 27 July 2022, while the current pipeline of applications continues to be processed by INZ. 

Investor Plus Visa (Category 1)

Previously, the applicant had to meet the following criteria:

  • Have NZ$10 million to invest in NZ.
  • Prove investment dollars lawfully earned.
  • Be of good health and character.
  • Hold investment in NZ for three years.

Investor Two Resident Visa

Previously, the applicant had to meet the following criteria:

  • Be under 66 years of age.
  • Speak English to a basic standard.
  • Be of good health and character.
  • Prove three years of business experience.
  • Show net worth of NZ$3 million or more
  • Have NZ$3 million to invest in NZ.
  • Prove investment dollars were lawfully earned.
  • Hold Investment in NZ for four years.

The 'Old' Acceptable Investments

Migrant investors that previously gained residence under the Investor 1 and Investor 2 category were required to invest in acceptable investments, as listed below:

  • Bonds issued by the New Zealand government or local authorities
  • Bonds issued by New Zealand firms traded on the New Zealand Debt Securities Market
  • Bonds issued by New Zealand firms with at least a BBB
  • Bonds issued by registered New Zealand banks
  • Equities in registered New Zealand banks
  • Bonds in finance companies
  • Equity in New Zealand firms
  • Residential property development
  • Commercial property
  • Eligible New Zealand venture capital funds
  • Philanthropic investment
  • "Angel funds or networks" investments

Do You Meet the Acceptable Investment Requirements?

Malcolm Pacific Immigration has one of the most skilled Investor Visa teams in the business. Our Investor Visa team regularly travels overseas with major New Zealand banks, investment advisers, tax experts and government officials to meet with and advise high-net-worth individuals planning on moving to New Zealand.

Contact our specialist Investor Immigration Team for answers to your questions and find out if you are eligible to apply.

Get started with a FREE consultation today

Our highly experienced licensed Immigration team will take away the stress and worry of navigating the complicated world of New Zealand Immigration. All you need to do is get in touch. Our team is on standby, ready to help.

Get started with a FREE consultation today

Our highly experienced licensed Immigration team will take away the stress and worry of navigating the complicated world of New Zealand Immigration. All you need to do is get in touch. Our employer team is on standby, ready to help.

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July 12, 2022
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