1、Doing Business in New ZealandLegal guidelines and informationGrow|Protect|Operate|FinanceDecember 2023Contents1.About New Zealand5.Banking and finance in New Zealand11.Buying real estate in New Zealand19 .Competition and antitrust in New Zealand25.Construction and major projects in New Zealand31.Con
2、sumer protection in New Zealand42.Contracting in New Zealand47.Corporate law in New Zealand55.Corporate restructuring and insolvency in New Zealand61.Employment and Health&Safety in New Zealand69.Environment and planning in New Zealand79.Financial markets in New Zealand89.Immigrating to New Zealand9
3、6.Intellectual property in New Zealand102.Investing in New Zealand111.Superannuation in New Zealand116.Tax in New ZealandAbout New ZealandAbout New ZealandKey points about New ZealandGeographyNew Zealand is a small country,made up of two main islands,with a total land area of 268,021 square kilometr
4、es.It is similar in size to Japan or Britain and has a population of 5.2 million.1 The official languages are English,Mori and New Zealand sign language.Wellington is the capital city,while Auckland is the most populous.Political and legal systemNew Zealand has a common law system inherited from Eng
5、land.The system is similar to that found in many British Commonwealth countries and comprises of statute law made by Parliament,supplemented by a collection of common law or case law made by the courts.The New Zealand Court system has four tiers;District Court;High Court;Court of Appeal and Supreme
6、Court.In additional to the Courts,New Zealand has a large number of specialist tribunals and bodies.EconomyDue to its geographic location and the size of its population,New Zealand is a trade dependent economy,is reliant on Foreign Direct Investment and is a big proponent of a free and open market.A
7、round 60%of its economic activity is made up from international trade.2The currency is based on the New Zealand dollar,which is freely floated against all major currencies.The major industries are agriculture(pastoral farming),horticulture and tourism.On a global scale New Zealand is the 12th larges
8、t agriculture exporter by value,the 2nd largest dairy exporter by value,the biggest sheep meat exporter and second biggest wool exporter.Other major industries include forestry,natural resources and fishing.2 Vital statisticsPopulation5.2 millionArea268,021km2GDPNZD$395 bn As at June 2023Supreme Cou
9、rtCourt of AppealHigh CourtDistrict CourtCourt System1 https:/www.stats.govt.nz/indicators/population-of-nz/2 https:/www.mfat.govt.nz/en/trade/nz-trade-policy/2 Doing Business in New Zealand Free trade agreementsNew Zealand economy depends on trade and is a strong advocate for free trade and the reg
10、ional and international institutions that support it.New Zealand is party to a large number of free trade agreements,including with Australia,China,the EU,the UK,Hong Kong,Chinese Taipei,South Korea,ASEAN,Singapore,Thailand,Malaysia,Brunei and Chile.We are also signatories to the Comprehensive and P
11、rogressive TransPacific Partnership(CPTPP)and to the Regional Comprehensive Economic Partnership(RCEP).Information on New Zealands international trading agreements can be found on the Ministry of Foreign Affairs and Trade website:www.mfat.govt.nz.New Zealands Top 10 Exports in 2022313.46.33.32.41.63
12、1.561.551.151.131.05Dairy,eggs,honeyMeatWoodFruits,nutsBeverages,spirits,vinegarModified starches,glues,enzymesCereal/milk preparationsFishMachinery including computersAluminium*Figures above are in USD3 http:/ bn(30.4%)Doing Business in New Zealand 3ServicesGovernment,education and healthManufactur
13、ingPrimary(agriculture,mining,fishing,forestry)New Zealand Sectors by GDP(2020)44 http:/sectorsdashboard.mbie.govt.nz/5 World economic forum,global competitiveness report 20196 Annual report,New Zealand Trade and Enterprise,20227 Corruptions perceptions index,transparency international,20218Annual r
14、eports 2017-2022 New Zealand Trade and Enterprise1st out of 141 countries for Macroeconomic Stability51st in the world for corruption transparency7450+companies supported in a successful capital raise8$11.6bn of live New Zealand investment opportunities64 Doing Business in New Zealand Banking and fi
15、nance in New ZealandBanking and finance in New ZealandThe team are alive to the market and aware of business and regulatory developments and how they impact their clients.They are an expert,experienced and thoughtful team.Banking&Finance,Chambers and Partners Asia Pacific,20233 partners8 professiona
16、lsRanked with:Specialists in:Acquisition FinancingTrade and Receivables Retirement Village FinancingProject FinancingProperty FinancingSecuritisationsRegulatorySyndicated LendingFinancial Product DevelopmentDebt Capital MarketsStructured FinanceConsumer FinanceSpecialists in:Acquisition FinancingTra
17、de and ReceivablesRetirement Village FinancingProject FinancingProperty FinancingSecuritisationsRegulatorySyndicated LendingFinancial Product DevelopmentDebt Capital MarketsStructured FinanceConsumer FinanceThe Reserve Bank of New Zealand (Reserve Bank)is New Zealands central bank.Banks operating in
18、 New Zealand must be registered with the Reserve Bank.Certain non-bank deposit takers(NBDTs)operating in New Zealand must be licensed by the Reserve Bank.Key points about banking and finance in New ZealandDoing Business in New Zealand 7The detailReserve bank of New ZealandThe banking industry in New
19、 Zealand is prudentially supervised by the Reserve Bank.The Reserve Banks purpose,objectives and powers are set out in the Reserve Bank of New Zealand Act 2021(the RBNZ Act)and the Banking(Prudential Supervision)Act 1989 respectively.In general,the Reserve Bank:formulates and implements monetarypoli
20、cy to maintain price stability andsupport sustainable employment;promotes the maintenance of a soundand efficient financial system;andsupplies and manages theNew Zealand currency.Fundamental to the Reserve Banks roles are managing the registration and prudential supervision of banks,and monitoring t
21、he financial system with the intention of preventing,or mitigating the consequences of,institutional distress or failure.Bank registrationAll banks operating in New Zealand must be registered with the Reserve Bank.There are currently 27 registered banks in New Zealand,most of which are subsidiaries
22、or branches of overseas-incorporated banks.Only an entity whose business substantially consists of borrowing or lending money,or the provision of financial services,may be registered as a bank in New Zealand.In general,for registration,the Reserve Bank will have regard for:Qualitative criteria:the a
23、pplicantsfinancial standing and its ability toprudently manage its business;andQuantitative criteria:evidence of theapplicants ability to meet the qualitativecriteria,and of its ability to consistentlycarry on business in a prudent manner onan ongoing basis following registration.In addition,applica
24、nts that are incorporated overseas are required to have the approval of their home supervisor to conduct banking business in New Zealand.The applicant must also meet the prudential requirements imposed on it by its overseas home supervisor.Any person or entity carrying on any activity in New Zealand
25、 and that includes Bank,Banker,or Banking in its name must be a registered bank or authorised to use that name by the Reserve Bank or otherwise be exempt under the Banking(Prudential Supervision)Act 1989.Non-bank deposit takers and the new Deposit Takers Act 2023An NBDT is an entity which is not a r
26、egistered bank but which offers debt securities(a deposit-taker)and carries on the business of borrowing and lending money,or providing financial services,or both.In general,every NBDT which makes a regulated offer of debt securities to retail investors requires to be licensed in New Zealand.If a li
27、cence is granted,it may be subject to conditions imposed by the Reserve Bank.NBDTs are prudentially regulated by the Reserve Bank under the Non-bank Deposit Takers Act 2013(NBDT Act)and the new Deposit Takers Act 2023(DTA)which was passed into law in July 2023(among other regulations).The DTA applie
28、s to all deposit takers(including banks and NBDTs)and introduces the following significant changes to New Zealands prudential settings:Introduction of a DepositorCompensation Scheme.Integration of separate prudential regimesfor the licensing of deposit takers.Strengthening of New Zealands deposittak
29、er crisis management framework.8 Doing Business in New Zealand The relevant provisions of the NBDT Act will remain in force until the DTA fully comes into effect.The new Depositor Compensation Scheme is expected to come into force first,in late 2024,but there will be a staggered implementation of th
30、e rest of the DTA until July 2028.Currently,the Reserve Bank proposes to develop and consult on new standards from early 2024 until 2026,with the new DTA licensing regime to be rolled out in 2027.For other regulatory requirements that may be relevant to banks,NBDTs and financial markets participants
31、,refer to Financial Markets in NZ.Doing Business in New Zealand 9We represent some of the largest financial institutions and corporate trustees in New Zealand and globally on matters including:Corporate financing,including acquisitionfinance,property development,trade finance,and receivables financi
32、ngs.Asset and asset based financing.Specialist retirement village development financing.Debt capital markets.Financial services regulatory advice.Consumer finance and PPSA advice.New product structuring and development,includingassisting major New Zealand and international bankswith developing corpo
33、rate finance,transactionalbanking,trade finance,receivables financing products.Structured finance arrangementsincluding securitisations.Restructuring.ContactHow we can help youLiz LimPartner D+64 9 909 6341M+64 21 190 Buying real estate in New ZealandBuying real estate in New ZealandProminent practi
34、ce with experience across the commercial property space,highlighted for its impressive public sector work and its work with the New Zealand government.The firm is adept at representing investors and funds on a range of real estate matters,including property acquisitions and building projects.Real Es
35、tate,Chambers and Partners Asia Pacific,20234 partners14 professionalsRanked with:Specialists in:Commercial leasingCommercial property and developmentOverseas InvestmentConstructionPublic Works and InfrastructureResidential ConveyancingAll titles in New Zealand are registered at Land Information New
36、 Zealand(LINZ),and their accuracy is guaranteed by the government.When purchasing real estate,it is common to use a standard form base contract customised for the particular real estate.Agreements for sale and purchase of real estate are usually conditional on the purchaser carrying out a due dilige
37、nce investigation and being satisfied with the real estate after that investigation.Overseas investors(or New Zealand entities with at least 25%overseas control)will be subject to restrictions on acquiring land in New Zealand.Investors need to be aware of certain rules when purchasing real estate in
38、 New Zealand,including government consents for certain purchases,the seismic rating system,and tax implications when investing in residential real estate.Key points about buying real estate in New ZealandDoing Business in New Zealand 13The detailNew Zealand has a well-established and transparent lan
39、d ownership system.Investing and trading in real estate assets has always played a key role in New Zealands economy.Equally important for those acquiring or establishing a business in New Zealand is to understand the accommodation requirements for the business regardless of the sector in which it op
40、erates.Registered title systemNew Zealand operates under the Torrens land registration system.All legal interests in land under the system are created by registration under the Land Transfer Act 2017 and are recorded against the title to the land.A copy of the title register to the land is readily a
41、ccessible and carrying out this search is often the first step in reviewing what affects the land.New Zealand has converted almost all titles,plans,and instruments into an electronic format,through a system run through LINZ called Landonline.Landonline allows up to date searching and electronic regi
42、stration of land transactions.The three most common forms of title in New Zealand are:Particular care should be taken when acquiring leasehold or unit title property,as well as other less common forms of title.Land is sensitive if it is or includes this type of landand exceeds an area threshold of:F
43、reeholdPurchase of freehold title gives you outright ownership of the land in question.This may also be referred to as fee simple.These terms are used interchangeably.LeaseholdPurchase of leasehold gives you the benefit of a long-term lease of the real estate.Commercial leases are not usually regist
44、ered.Unit TitlesA form of strata or sectional title ownershipPurchase of unit titles gives you title to adefined part of a larger real estate.These are a common form of title forapartment buildings.They are subject to certain rules under theUnit Titles Act 2010.14 Doing Business in New Zealand The O
45、IA sets out a procedure for overseas investors to seek consent to acquire sensitive land.Examples of the categories of land(subject to,in certain cases,a minimum area threshold)that are considered sensitive land typically include the following:Residential land(being land that has a propertycategory
46、of residential or lifestyle in therelevant district valuation roll);Farm land or non-urban land;Lake bed;Historic land;Conservation land;Heritage ordered land;Reserve land,public parks,land used forrecreational purposes or open spaces;Mori reservation land;Marine and coastal area land;Land on numero
47、us New Zealand Islands;andLand adjoining certain types of sensitive land.In order to obtain consent to acquire residential land,an overseas investor needs to meet one or more of the following tests(depending on the nature of the investment and whether the land contains other sensitive characteristic
48、s):The commitment to reside in New Zealandtest(which is the only pathway that allowsan overseas person to live in the acquiredresidential property);The increased housing test;The non-residential use test;The incidental residential use test;orThe benefit to New Zealand test.The OIA also provides exem
49、ptions for investingin sensitive land,such as:Mori landIn many instances Mori land ownership and use is governed by the Te Ture Whenua Mori Act 1993.This Act contains a range of restrictions on the disposal of various types of Mori owned land which can make dealing with Mori land very complicated.Co
50、ntracts for sale and purchase of real estateTo be enforceable,a contract for sale and purchase of real estate must:be in writing,andsigned by the parties(or theirauthorised agents).There is a high reliance on standard form documents for transacting more straightforward assets.Contracts are often tai
51、lored to reflect the commercial terms and nature of the assets involved.In New Zealand it is common to undertake a relatively limited due diligence process before entering into a contract,which will then include more detailed conditions for the parties to satisfy before the agreement becomes uncondi
52、tional and settlement occurs.Subject to the satisfaction of conditions,written agreements are binding.Typical conditions include due diligence,the satisfaction of regulatory consents,building inspection,valuation,obtaining finance,and board or CEO approval.Overseas Investment ActOverseas investors(w
53、hether individuals or corporate entities with more than 25%overseas control)need government consent under the Overseas Investment Act 2005 and the Overseas Investment Regulations 2005(together,the OIA),when acquiring an interest in sensitive land or any other significant business asset(including sha
54、res in a New Zealand company)for a consideration of more than NZ$100 million.Residential land in New Zealand is automatically sensitive land,which means that overseas persons are generally required to obtain consent to acquire residential land.Australian and Singaporean nationals and corporate inves
55、tors are exempt from the consent requirements relating to residential land.Doing Business in New Zealand 15Periodic leases;Residential tenancies of less than five years;Off-the-plans large apartment developmentswhich has received an exemption certificate tosell to foreign investors;Hotel units acqui
56、red and leased back;andForestry rights of less than 1,000 hectares.The OIA is managed and enforced by the Overseas Investment Office.The OIA sets out numerous powers and penalties for contravening the OIA.Seismic rating of commercial buildingsFollowing several major earthquakes in New Zealand over t
57、he past decade,purchasers of commercial buildings are advised to include the seismic rating of those buildings in their due diligence investigation.While all new buildings are required to be constructed to at least 100%of the current building code,older buildings are unlikely to have been constructe
58、d to that standard.Recent amendments to the Building Act have brought in changes to manage earthquake prone buildings.One of those initiatives included creating a register of earthquake-prone buildings.Purchasers need to be aware that older buildings with seismic ratings of less than 34%of the curre
59、nt building code are classified as“earthquake prone”and strengthening works will be required by statute.Notices may be issued by the Council requiring work to be completed.Any strengthening works completed will usually be at a cost to the landowner.There are other alternatives,such as demolition alt
60、hough it is important to ascertain whether the building is subject to a Historic Places Order,preventing demolition.Seismic rating of commercial buildingsIncome Tax must be paid on the sale of residential properties purchased on or after 27 March 2021 where the real estate is sold within ten years o
61、f purchasing it,unless the real estate was:used as the owners main home,inherited from a deceased estate,orsold as part of a relationship breakdown.Residential properties purchased between 29 March 2018 and 26 March 2021,are subject to the same tax if sold within 5 years of purchase unless one of th
62、e exceptions set out above apply.Residential properties with a qualifying“new build”which are purchased or acquired on or after 27 March 2021 will also be subject to a 5-year bright-line period.This new build bright-line applies if it is a“new build land”acquired within 12 months after it became a n
63、ew build land,and there is a dwelling at the time of disposal or settlement.Generally,a“new build land”means land that:a self-contained residence or abode has beenadded to;andhas received its code compliance certificate(CCC)issued under the Building Act 2004on or after 27 March 2020(subject tosome e
64、xceptions).Residential land withholding tax(RLWT)applies where the seller is an offshore acquisition person or entity and the land is sold within the bright-line periods stated above.RLWT also applies to sales by New Zealand entities that are more than 25%owned or controlled by offshore persons.The
65、sellers lawyer is required to deduct the RLWT and pay it to Inland Revenue on the sellers behalf.From 1 October 2021,interest deductibility rules limit what can be claimed as interest incurred by residential property investors in disallowed residential properties(DRP)unless an exclusion or an exempt
66、ion applies.DRPs generally include land in New Zealand which is commonly and will be foreseeably used as a residential accommodation.This can apply to properties that are rented out long 16 Doing Business in New Zealand or short term,used for short-stay accommodation some or all the time,or left vac
67、ant.Some loans which were first drawn before 27 March 2021 may also be partially deductible as part of the transitional phasing-out of interest deductibility.However,interest deductions will be phased-out completely from 1 April 2025.Building and developing real estateBuilding work and the use of bu
68、ildings is regulated by the Building Act 2004.New buildings,as well as most additions or alterations to existing buildings,will require a building consent.After completion of building work under a building consent,a code compliance certificate will need to be obtained.It is important to check when p
69、urchasing real estate that any building work carried out has had the relevant code compliance certificate issued.Landowners should hold records of any work or maintenance completed,and any inspections undertaken.Most properties,other than stand-alone residential homes,are also required to hold a bui
70、lding warrant of fitness.These are issued annually and confirm that the building complies with certain Building Act criteria,which for the most part relate to health and safety.Both code compliance certificates and building warrants of fitness can be checked during a due diligence investigation by r
71、eviewing a Land Information Memorandum(LIM)report for the real estate.Resource Management Act and district plans The Resource Management Act 1991(RMA)is the primary source of environmental law in New Zealand.Under the RMA,territorial authorities have responsibility for the control,use,development an
72、d protection of land.Territorial authorities are also required to have district plans which contain rules relating to land use and subdivision activities in that authoritys area.The RMA and district plans can have major implications for real estate developments and other construction projects.A larg
73、e development may require multiple consents under the RMA before its commencement.The Government announced that the RMA would be repealed and replaced with three new pieces of legislation:the Natural and Built Environment Act,the Spatial Planning Act and the Climate Adaptation Act.The new Acts are i
74、ntended to speed up and simplify the planning process,reduce costs and to protect our environment.Some changes in the new law began coming into effect on 24 August 2023.The legislations will gradually phase in over a 10-year period and many parts of the RMA will remain in place until then.LeasingThe
75、 physical day-to-day operations of most businesses in New Zealand are carried out under a lease of the land and buildings that the business occupies.The lease terms are negotiated between the contracting parties,being in this case the landlord and the tenant.However,there are also numerous other rig
76、hts and obligations implied into leases by statutes,principally under the Property Law Act 2007.There is a high reliance on standard lease forms,at least as a starting point,with tailored special conditions to reflect the particular premises and the commercial terms.Most leases are for a specified t
77、erm and may allow the tenant the right to renew for an additional term or terms.When acquiring an existing business that occupies premises on a leasehold basis,it is very likely that the lease will include terms controlling the transfer of the lease to the buyer.These terms often cover both the acqu
78、isition of business assets where shares are being acquired or there is an effective change of management or control.Residential tenanciesResidential tenancies are governed by the Residential Tenancies Act 1986,which imposes minimum standards for properties,and processes for managing and terminating
79、tenancies.These requirements and processes are strictly enforced.Doing Business in New Zealand 17Businesses acquiring or disposing of real estate interestsneed input from advisers who know the industry as wellas the law advisers who can identify the many risks,andmanage them in a way that is commerc
80、ially appropriate,legally sound,and cost-effective.Dentons real estate team has a wealth of experiencein all aspects of property and real estate law.Our teamworks closely with clients to get a good understanding oftheir business and their present and future needs.We are supported by colleagues in ot
81、her teams,such asenvironment and planning,construction,infrastructure,health and safety,public law,banking and finance,corporate and commercial,employment,private wealth,tax,and dispute resolution.ContactHow we can help youMichelle HillPartnerD+64 9 916 6374M+64 27 4582 Competition and antitrust in
82、New ZealandThe firm has a strong knowledge of New Zealand law,is very practical in its application and is cost-effective.Chambers and Partners Asia Pacific,20233 partners5 professionalsSpecialists in:Conduct adviceMerger adviceClearance applicationsAuthorisation applicationsDealing with investigatio
83、nsLitigationCompetition and antitrust in New ZealandKey points about competition law in New ZealandCompetition law is governed in New Zealand by the Commerce Act 1986.The purpose of the Commerce Act is to promote competition in markets for the long-term benefits of New Zealand consumers.To this end,
84、the Act sets out a number of prohibitions on various f orms of anti-competitive behaviour,and provides for significant financial penalties for a breach of those provisions.The Commerce Commission is the regulatory body that administers and enforces the Commerce Act.Doing Business in New Zealand 21Th
85、e detailMergers and AcquisitionsThe Commerce Act sets out the rules which apply to mergers and acquisitions affecting markets in New Zealand.The Act prohibits an acquisition of shares or business assets which would result in a substantial lessening of competition in any market.The Commission has pub
86、lished guidelines indicating that competition is unlikely to be substantially lessened where,should an acquisition proceed,either of the following conditions exist:in markets where the three largest firms(post-transaction)comprise less than 70%of themarket,the merged firm would have a marketshare of
87、 less than 40%in markets where the three largest firms(post-transaction)comprise more than 70%,themerged firm would have a market share of lessthan 20%.Obtaining Commission ApprovalParties to a proposed acquisition have a choice as to whether to apply for and implement their proposal in accordance w
88、ith the prior approval of the Commission,or to proceed without approval.Applications are voluntary,so are normally only made where the safe harbour guidelines above are not met.Obtaining the prior approval of the Commission provides protection against the Commission or any other person taking legal
89、action under the Commerce Act provided the merger or acquisition is completed within 12 months from the date of the Commissions approval.The Commission is able to issue one of two types of approval to a proposal:A clearance,which is a confirmation that theacquisition is not unlawful(i.e.that it will
90、 notresult in a substantial lessening of competitionin any market).An authorisation,which is an approval foran acquisition which would otherwise beprohibited.An authorisation will only be grantedif the Commission is satisfied that there isenough public benefit in the acquisition tooutweigh the detri
91、ments of the substantiallessening of competition caused by it.The normal time frame for the Commission to decide on a straightforward application for clearance is about eight weeks,though it is normal to engage with the Commission informally before submitting an application.An application for author
92、isation will usually take at least three months.Penalties for breach of business acquisition provisionsThe maximum penalty for a company for a breach of the business acquisition provisions of the Commerce Act is a fine of NZ$10 million or three times the commercial gain resulting from the breach(or
93、10%of turnover if this cannot be easily established).The maximum penalty for an individual is a fine of NZ$500,000.In addition,the High Court may order a person or company to dispose of specified assets or shares acquired in breach of the Commerce Act.Individuals or companies may also take private l
94、egal action,for example,by applying for an injunction to stop an acquisition or seeking damages for loss suffered as a result of an acquisition.Restrictive trade practicesThe Commerce Act prohibits the following collective restrictive trade practices:Practices substantially lessening competition The
95、 Commerce Act prohibits a contract,arrangement or understanding that has thepurpose,or has or is likely to have the effect,of substantially lessening competition inthe market.This section is very broad in itsapplication and it is not necessary for thereto be a legally binding contract for there to b
96、ea breach.22 Doing Business in New Zealand Cartel provisions The Commerce Act also prohibits the entering into,or giving effect to,a contract,arrangement or understanding containing a cartel provision.A cartel provision is a provision that has the purpose,effect or likely effect,of:price fixing wher
97、e competitors fix,control,or maintain the price of a product or service.restricting output where competitors prevent,restrict or limit the production,supply or acquisition of a particular good or service.market allocating an example of market allocating is where competitors allocate a market between
98、 themselves,for example according to geographical area.Individuals involved in cartel conduct are committing a criminal offence.The Commerce Act prohibits the following unilateral restrictive trade practices:Taking advantage of market power Where a company has substantial market power,it must not ta
99、ke advantage of that market power with the purpose,effect,or likely effect of substantially lessening competition.The Commerce Act prohibits a company with a substantial degree of market power from taking advantage of that power to:restrict the entry of a competitor prevent or deter a competitor eng
100、aging in competitive conduct eliminate a competitor from the market.An example of where an abuse of market power might arise is predatory pricing.This is where a business sells its products below market value in order to chase its competitors out of the market due to an inability to compete.Resale P
101、rice Maintenance Suppliers cannot fix the price of their goods sold by other retailers.Furthermore a supplier cannot enforce a minimum price for resale(whether by specifying a minimum price or by setting restrictions on the ability to discount).Penalties for restrictive trade practicesThe Commission
102、 has a range of enforcement options available to it depending on the extent and severity of a breach and the public interest involved.In some cases the Commission will merely issue a warning;in more serious cases prosecution in the High Court can occur.As with breaches of the acquisition provisions,
103、an individual can face penalties of up to NZ$500,000 per breach and,for companies,the penalty can be up to the greater of NZ$10 million,three times the value of any commercial gain resulting from the contravention,or 10%of the turnover of the company(and any interconnected companies).Doing Business
104、in New Zealand 23ContactHow we can help youDavid CampbellPartnerD+64 9 375 1115M+64 21 678 Understanding and reviewing the Commerce Actcompliance requirements for your business,including inrespect of planned acquisitions.Employee/management training materials for CommerceAct compliance.Drafting or r
105、eviewing of contracts with competitors.Drafting or reviewing supply agreements.Drafting and filing clearance or authorisation applications.Assisting in responding to Commission investigations.Bringing or defending a claim under the Commerce Act.Construction and major projects in New ZealandConstruct
106、ion and major projects in New ZealandNothing is too difficult for them,the advice is presented in a simple,direct way,and they understand the commercial side of things and seamlessly incorporate this into their advice.Construction,Chambers and Partners Asia Pacific,2023Specialists in:Construction Co
107、ntract drafting and negotiationConstruction Contract AdministrationConstruction Contracts ActDispute ResolutionVertical and horizontal infrastructureMajor Building ProjectsPower InfrastructureCivil constructionTransport InfrastructureWater and Waste Infrastructure4 partners16 professionalsRanked wit
108、h:Specialists in:Construction Contract drafting and negotiationConstruction Contract AdministrationConstruction Contracts ActDispute ResolutionVertical and horizontal infrastructureMajor Building ProjectsPower InfrastructureCivil constructionTransport InfrastructureWater and Waste InfrastructureKey
109、points about construction law in New ZealandBuilding and construction projects are almost always carried out in New Zealand under a negotiated contractual arrangement,the form of which will be determined by the type,size and complexity of the particular project.Building and construction contracts ar
110、e governed by the general law of contract subject to specific legislative controls,primarily under the Resource Management Act 1991,Health and Safety at Work Act 2015 (both dealt with in other sections of this guide),Building Act 2004,and the Construction Contracts Act 2002.Doing Business in New Zea
111、land 27The detailProcurementTender processes are commonly used by principals(particularly public agencies)and head contractors to create a competitive bid environment.Traditional contracting models still prevail in the market although in recent years,some large-scale infrastructure projects have bee
112、n procured under a public private partnership(PPP)structure or on the basis of other alliancing models.Standard Form ContractsThe New Zealand Standard(NZS)suite of contracts are the most commonly used construction contracts in the market,primarily:NZS 3910(traditional build only);NZS 3916(design and
113、 build);and NZS 3917(fixed-term or maintenance).These are often tailored to specific projects through the inclusion of special conditions.NZS 3910 has been significantly updated with the new version to be released in December 2023.There are also other standard forms including:New Zealand:the NZIAs S
114、CC1 2018 contractand a Master Builders contract,andInternational:FIDIC and NEC 3 and 4.Building Act 2004All building work in New Zealand must comply with the Building Code(contained in Schedule 2 to the Building Act).The Code prescribes minimum performance standards which a building must meet and me
115、thods by which a builder can establish compliance.The Code is being constantly updated.The Building Act also:requires work affecting the structural integrityor weathertightness of a building to be carriedout or super-vised by a Licensed BuildingPractitioner,and;implies warranties relating to the per
116、formanceof contract works into all residentialbuilding contracts.Payment SecurityThe Construction Contracts Act 2002(CCA)is designed to assist contractors in securing their right to payment via:statutory right to progress payments;right to claim as a statutory debt dueamounts owing;right to obtain a
117、 charging order(or lien)over a construction site;rendering invalid pay-if-paid andpay-when-paid clauses;right to suspend work for unjustifiednon-payment;all retentions to be held on trust or viaa financial instrument.The Construction Contracts(RetentionMoney)Amendment Act 2023 hasmarkedly improved t
118、he retentions regimeunder the CCA.These changes come intoforce in October 2023.Tortious LiabilityNew Zealand recognises an extra-contractual duty of care on the part of contractors,subcontractors,suppliers and consultants(amongst others)to owners and subsequent purchasers with respect to building de
119、fects,including weathertightness requirements,and the parties responsible can be sued in tort for breaching this duty of care.Duration of LiabilityLegal proceedings must be commenced within the relevant statutory limitation period which,in short,requires a claim to be brought within 6 years from the
120、 date of the act or omission in question.However,if the claimant has late knowledge of the damage,the claim can be brought outside the 6 year limitation period provided it is lodged within three years of discovery of the damage.In relation to building work covered by the Building Act,this is subject
121、 to an overarching 10 year long-stop period.28 Doing Business in New Zealand Seismic activityThe Building(Earthquake-prone Buildings)Amendment Act 2016(EPB Act)was passed in response to the numerous seismic events that have occurred in New Zealand since 2010.In short,it requires building owners to c
122、arry out strengthening work to commercial and apartment buildings identified by territorial authorities(and confirmed via an engineering assessment)as prone to collapse in a moderate earthquake.The Ministry of Business Innovation and Employment is in the process of reviewing the technical standard(N
123、ZS 1170.5)against which a buildings performance is measured.This review comes after the release of the updated National Seismic Hazard Model in 2022,which highlighted the need to boost national seismic resilience.However,the current EPB Act requires that buildings are assessed against the version of
124、 NZS 1170.5 which applied at 1 July 2017.This means any update to NZS1170.5 will not effect the assessment of earthquake prone buildings under the EPB Act,unless the EPB Act is amended to reflect the updated understanding of seismic risk following the release of the National Seismic Hazard Model(202
125、2).Dispute resolutionStatutory adjudication of disputes under the CCA is by far the most popular mode of dispute resolution,however construction contracts will usually provide for arbitration as the final step.Dispute Review Boards remain relatively uncommon in New Zealand,save on some larger public
126、 projects.New Zealand has no specialist construction law courts.Mediation also remains a popular mechanism for resolving disputes.Doing Business in New Zealand 29Negotiating,advising on standard formdocumentation and drafting bespoke contracts ofall procurement models to minimise client risk.Advisin
127、g on residential and commercial buildingprojects and a wide range of infrastructure projectssuch as road and rail projects,schools,prisons,stadiums,civil and earthworks,and water andenergy projects.Advising on large-scale joint venture projects andcomplex procurement processes such as PPPs,project a
128、lliances and early contractorinvolvement(ECI)arrangements.Providing strategic project delivery advice andcontract administration support,including tosecure the right to payment through contractualmeans and under the CCA.Preparing,defending and resolving commercialand residential claims brought by wa
129、y of CCAadjudication,arbitration and in the Courts,andthrough ADR such as expert determination,conciliation and mediation.ContactHow we can help youStuart RobertsonPartner D+64 9 375 1151M+64 21 846 Consumer protection in New ZealandConsumer protection in New ZealandThe team has great attention to d
130、etail,can deliver on required timelines,always with a smile and can act as external advisers or another pair of hands in an in-house environment,depending on the clients needs.Legal 500 Asia Pacific,2023Specialists in:The Fair Trading Act Consumer Guarantees Act and other consumer legislationReviewi
131、ng marketing collateral for compliance with both the Fair Trading Act and Advertising Standards Codes3 partners9 professionalsRanked with:Key points about consumer protection in New ZealandConsumers in New Zealand are protected by six key sources of law:Fair Trading Act 1986Consumer Guarantees Act 1
132、993Credit Contracts andConsumer Finance Act 2003Privacy Act 2020Unsolicited Electronic Messages Act 2007The sales promotion scheme regimein the Gambling Act 2003.There are also voluntary codes such as the Advertising Standards.Doing Business in New Zealand 33The detailFair Trading Act 1986(FTA)The F
133、TA promotes trading which is fair,honest,and transparent.It applies to the supply of goods or services in trade.The FTA prohibits:Deceptive or misleading conduct:Consumers must not be misled or deceivedabout the nature,manufacturing process,characteristics,suitability to purpose,or quantityof goods
134、or services.False,misleading and unsubstantiatedrepresentations:Representations made toconsumers about goods or services must notbe false or misleading.Representations madewithout reasonable grounds,even if they arebelieved to be true(or are in fact true),will alsobreach the FTA.Unfair contract term
135、s:A contract term isunenforceable if a court declares that it is unfair.An unfair contract term is one that causessignificant imbalance in the parties rights andobligations,is not reasonably necessary toprotect the legitimate interests of the businessand causes detriment if enforced.The scope ofthis
136、 applies to:standard form consumer contracts involving the supply of goods orservices of a kind ordinarily acquired forpersonal,domestic,or household use orconsumption;andsmall trade contracts where each partyis engaged in trade,the contract is not aconsumer contract and it does not compriseor form
137、part of a trading relationshipthat exceeds an annual value thresholdof NZ$250,000 when the contractualrelationship first arose.Unfair practices:The FTA lists a number ofactivities which are considered to be unfair andwhich are prohibited.Some examples of thelisted activities include pyramid selling
138、schemes,bait advertising,and requiring payment forunsolicited goods or services.Contracting out In most cases,the FTA cannot be contracted out of.In some business-to-business transactions,contracting out is possible in writing if both parties are in trade and the goods or services are both supplied
139、and acquired in trade and it is fair and reasonable to do so.Other matters dealt with under the FTA include:compliance with safety standards for certainproducts and services offered to consumers,toprevent or reduce risk of injury to a person;compliance with consumer informationrequirements for certa
140、in products and servicesoffered to consumers;layby sale agreements and disclosurerequirements to consumers;uninvited direct sale agreements and disclosurerequirements to consumers;extended warranties;andauctions.Penalties for breaching the FTAa maximum fine for breach by an individual ofNZ$200,000 p
141、er offence,or NZ$600,000 peroffence for a business;compensation to affected consumers;injunctions;andmanagement banning orders.Consumer Guarantees Act 1993(CGA)Provides consumers with a number ofguarantees that apply to goods or servicespurchased from a supplier in trade.Has a broad scope defining a
142、 consumer as aperson who acquires goods or services of a kindordinarily acquired for personal,domestic orhousehold use or consumption,provided that34 Doing Business in New Zealand the person does not represent themselves as acquiring the goods or services for resupplying them in trade,consuming them
143、 in the course of a process of production or manufacture,or in the case of goods,repairing or treating in trade other goods or fixtures on land.Applies to certain business-to-businesstransactions,giving the business consumerthe benefit of the same guarantees as anindividual consumer.The guarantees g
144、enerally cannot be contractedout of,but as with the FTA,there is a limitedexception for parties to a business-to-businesstransaction where the goods or services arepurchased for business purposes and it wouldbe fair and reasonable to contract out ofthe CGA.In relation to the supply of goods,the CGA
145、implies the following guarantees:the supplier has the legal right to sell thegoods,the goods are free of any undisclosedsecurity interests and that the consumer has theundisturbed possession of the goods;the goods will be delivered at the time agreedor within a reasonable time if the supplier is tod
146、eliver the goods;the goods are of acceptable quality;the goods are fit for a particular purpose madeknown by the consumer or represented bythe supplier;the goods match the suppliers description ofthe goods or any sample;the goods are sold at a reasonable price wherethe price is not pre-determined by
147、 the contract,left to be determined in a manner agreed by thecontract nor left to be determined by the courseof dealing between the parties;andrepairs and spare parts will be made reasonablyavailable for a reasonable period after the goodsare so supplied.In relation to the supply of services,the CGA
148、 implies the following guarantees for services.The services will be:performed with reasonable care and skill;reasonably fit for any particular purpose that theconsumer makes known to the supplier;completed within a reasonable time wherethe time has not been pre-determined by thecontract,left to be f
149、ixed in a manner agreed bythe contract nor left to be fixed by the course ofdealing between the parties;andsupplied at a reasonable price where the priceis not pre-determined by the contract,left to bedetermined in a manner agreed by the contractnor left to be determined by the course ofdealing betw
150、een the parties.Liabilities and PenaltiesWhere goods do not comply with a guarantee,a consumer may seek redress against the supplier or,in the case of goods supplied,the manufacturer or importer,at the consumers election.If the failure is capable of remedy,the consumer must first give the supplier(o
151、r otherwise)the right to rectify the breach.If the failure is minor,the supplier can choose to either repair the goods,replace the goods or refund the consumer.If the supplier refuses to repair faulty goods or fails to do so within a reasonable time,the consumer may have them repaired elsewhere and
152、recover the costs from the supplier.If the failure cannot be remedied or cannot be put right within a reasonable time,or is substantial,the consumer may reject the goods or cancel the service contract,or obtain damages for any reduction in value of the good or service.In addition,the consumer can al
153、so claim for any other reasonably foreseeable loss that results from the failure.Doing Business in New Zealand 35Credit Contracts and Consumer Finance Act 2003(CCCFA)Places strict requirements on lenders whoprovide credit to consumers for personal,domestic or household purposes under creditcontracts
154、 and consumer leases,and buy-backtransactions of land.Requires lenders to comply with the lenderresponsibility principles,some of which include:exercising care,diligence and skill inadvertising credit services,before enteringinto credit arrangements with a borrowerand in all subsequent dealings with
155、 aborrower in relation to an agreement orrelevant insurance contract or a guarantorin relation to a relevant guarantee;making reasonable inquiries into aborrowers requirements and objectives;considering a borrowers repayment abilities;assisting a borrower to make an informeddecision;andtreating a bo
156、rrower reasonably and in anethical manner.PenaltiesLenders can be fined up to NZ$200,000 for individuals and NZ$600,000 for businesses for breaching the CCCFA.Courts can also reopen oppressive contracts which are unjustly burdensome,unconscionable or breach reasonable standards of commercial practic
157、e.Privacy Act 2020(Privacy Act)Governs the collection,storage,use anddisclosure of personal information by requiringcompliance with thirteen InformationPrivacy Principles(IPPs).Personal information is broadly defined asinformation about an identifiable individual.The Privacy Act applies to agencies,
158、whichinclude any person or body of persons,whethercorporate or unincorporated and whether inthe public sector or private sector(unless anexception applies).It applies to New Zealand agencies as well as overseas agencies carrying on business in New Zealand.The IPPs,among other things,specify that an
159、agency:Must not collect personal information unless it isnecessary for a lawful purpose connected witha function or activity of the agency(and mustnot require identifying information if the purposedoes not require it);must collect personal information fromthe individual concerned(unless anexception
160、applies);should take reasonable steps to ensure theindividual is aware of the collection of personalinformation,and other information in relationto the collecting agency and the purpose forsuch collection,who the information will bedisclosed to,the consequences(if any)for theindividual if the inform
161、ation is not provided,and the individuals rights of access to,andcorrection of,information;may only collect personal information by lawfulmeans,and by fair and not unreasonablyintrusive means(particularly in the case ofchildren or young persons);ensure that the personal information is protectedby re
162、asonable security safeguards to protect theinformation from loss,unauthorised access,use,modification or disclosure and other misuse;upon request from an individual,giveconfirmation of whether or not the agencyholds,and give access to,their personalinformation,and also advise the individual thatthey
163、 may request correction of any personalinformation,and,if the agency does not correctthe information,it must attach a statement ofcorrection to the information if the individual hasprovided it;must not use or disclose personal informationwithout taking reasonable steps to ensurethat the information
164、is accurate,up to date,complete,relevant and not misleading;36 Doing Business in New Zealand must not to keep personal information longer than necessary;should only use or disclose personal information for the purposes it was collected for,unless the individual consents or another of the exceptions
165、applies;may only disclose personal information to a foreign entity in certain circumstances,essentially where the information will be protected by similar safeguards to those provided under the Privacy Act;and may only use unique identifiers when it is necessary,may not use a unique identifier assig
166、ned by another agency,and must take reasonable steps to protect unique identifiers from misuse.The Privacy Act requires mandatory reporting of privacy breaches where it is reasonable to believe the breach has caused serious harm or is likely to do so.PenaltiesBreach of any of the IPPs is grounds for
167、 a complaint to the Privacy Commissioner.The Privacy Commissioner may investigate the complaint and may refer matters to the Director of the Human Rights Review Tribunal,who may award remedies such as damages,a declaration that the actions interfere with privacy,a compliance order,costs,or other rel
168、ief deemed appropriate.The Privacy Commissioner may issue compliance notices and binding decisions on access requests.Privacy Act fines of up to NZ$10,000 may be imposed for offences.The Human Rights Review Tribunal has jurisdiction to award damages of up to NZ$350,000 in respect of the interference
169、 with the privacy of an individual.However,in practice,awards by the Human Rights Review Tribunal in relation to breaches of the IPPs tend to be much lower,and the highest awards(closer to NZ$100,000)are reserved for only the most egregious breaches where significant harm has been caused to the aggr
170、ieved individual.See here for more information about claims and damages awarded by the Human Rights Review Tribunal.Unsolicited Electronic Messages Act 2007(UEMA)An individual or organisation(person)must comply with the UEMA when sending emails(and SMS messages)to consumers.The UEMA prohibits the se
171、nding of unsolicited commercial electronic messages.Essentially,in order to send commercial electronic messages,the person must first obtain consent from the recipient.Consent can either be:express(for example by way of a tick the box opt in when a person provides their contact details);inferred(fro
172、m the conduct,business and other relationships of the person concerned);or deemed(where an email address has been published by a person in a business or official capacity,they have not expressly said they do not wish to receive unsolicited electronic messages and the message sent to that address is
173、relevant to the business or duties of the person in a business or official capacity).Electronic messages that are subject to the UEMA include emails,faxes,instant messages,SMS(txt),multimedia messages,and other mobile phone messages,but not voice calls or voice messages.Commercial electronic message
174、s are defined to include electronic messages that market or promote goods,services,land,an interest in land,or a business or investment opportunity.Common electronic messages that are not considered Commercial electronic messages include those that:provide a quote or estimate of goods or services,if
175、 that quote was requested by the recipient;facilitate,complete or confirm a commercial transaction which was previously agreed to with the person sending the message;provide notification of factual information about a subscription,membership,account,loan,or similar relationship involving the ongoing
176、 purchase or use by the recipient of goods or services offered by the person who authorised Doing Business in New Zealand 37the sending of the message or the recipients ongoing subscription,membership,account,loan,or similar relationship;ordeliver goods or services,including productupdate or upgrade
177、s,that the recipient isentitled to receive under the terms of atransaction that the recipient has previouslyentered into with the person who authorisedthe sending of the message.The person,when sending a commercial electronic message,must also:identify itself clearly as the sender of eachcommercial
178、electronic message;andinclude a functional unsubscribe facility inall commercial electronic messages which isfunctional and valid for at least 30 days after theprincipal message is sent.PenaltiesAn individual can be liable to pay a penalty not exceeding NZ$200,000 in respect of a civil breach and an
179、 organisation can be liable to pay a penalty not exceeding NZ$500,000.The Department of Internal Affairs is active in this space,and if a complaint is made it is very likely to be investigated.Gambling Act 2003 (Gambling Act)Businesses may use sales promotions or competitions as a marketing techniqu
180、e to promote the goods and/or services they offer to consumers.However,a business will be prohibited from running a promotion in New Zealand if the promotion is considered gambling.The exception to this is if the promotion is expressly permitted under the Gambling Act.Gambling is defined as the payi
181、ng or staking of consideration,directly or indirectly,on the outcome of something and seeking to win money,where that outcome depends wholly or partly on chance.For this purpose,money includes moneys worth,whether or not convertible into money.A promotion or competition may be authorised if it is co
182、nsidered a sales promotion scheme.A sales promotion scheme is defined under the Gambling Act as gambling that meets the following criteria:a promotion which does not involve a gamingmachine,nor a prize restricted or prohibitedunder the Gambling Act;a promotion which is used by a creator,distributor,
183、or vendor of goods or services topromote the sale of those goods or services,in that:participation in the gambling requires aperson to purchase the goods or servicespromoted for a price not exceeding theusual retail price;andthe date or period on or over which theoutcome of the gambling will be dete
184、rminedis clear to the participant at the time andplace of sale;the person is not required to pay direct orindirect consideration other than to purchasethe goods or services promoted(except thecost,at the standard rate,incurred in submittingan entry into the promotion,for example,thecost of sending a
185、 telecommunication by amobile phone at the standard rate);andthe outcome is determined:random or wholly by chance;orpartly by chance(whether chance playsthe greater or lesser part)and partly by theapplication of some knowledge or skill).PenaltiesIn the case of an individual,an offence under the Gamb
186、ling Act can hold a person liable to imprisonment for a term not exceeding 1 year or to a maximum fine of NZ$20,000.In the case of a body corporate,a business may be liable to pay a maximum fine of NZ$50,000.38 Doing Business in New Zealand Advertising StandardsAdvertising in New Zealand is regulate
187、d by the Advertising Standards Authority(the self-regulatory body,ASA)under the Advertising Standards Code,Children and Young Peoples Advertising Code,Alcohol Advertising and Promotion Code and several others(Advertising Standards).Although the Advertising Standards are not laws per se,they set impo
188、rtant expectations for how businesses in New Zealand should operate when advertising their goods and/or services.ASA members consist of associations and incorporations representing the majority of the media and advertising industries in New Zealand.The ASA will consider complaints about any advertis
189、ement in any medium,and any person can complain.The ASA can make orders as to the removal or amendment of any advertisement and publicise its decisions.Compliance with the ASAs decisions are voluntary,but the rate of compliance in the industry is extremely high and enforced by media and advertisers(
190、i.e.TV stations,advertising agencies,outdoor marketers,etc).The Advertising Standards Code aims to ensure that every advertisement is a responsible advertisement,and all advertising is legal,decent,honest and respects the principles of fair competition.Of relevance,the Advertising Standards Code est
191、ablishes two broad principles which are linked to 17 rules.These include:Principle 1:Social Responsibility Advertisements must be prepared and placedwith a due sense of social responsibility toconsumers and to society.Principle 2:Truthful Presentations Advertisements must be truthful,balancedand not
192、 misleading.Doing Business in New Zealand 39FTA and CGADraft or review your consumer contracts and terms of trade.Draft or review your business-to-business contracts.Review your marketing material.Advise you on your obligations under the FTA and CGA.Defend a claim for an alleged breach of the FTA.Pr
193、ovide training on the CGA and FTA to avoid staff breaching it.CCCFADraft or review your credit contract terms,consumer leases or buy-back agreements.Advise you on advertising requirements under the CCCFA.Draft or review your disclosure statements to borrowers.Register and enforce security interests.
194、Defend a claim for an alleged breach of the CCCFA.Provide training on the CCCFA to avoid staff breaching it.Privacy ActAdvise you on how to safely hold,collect,store,use and disclose information.Draft or review your Privacy Notices for New Zealand and Australian law;and GDPR.Prepare templates and gu
195、idance on data audits and privacy impact assessments.Prepare policies for various aspects of privacy compliance,for example,in relation to HR matters,front-line staff,breach protocols and procedures.Provide training for your staff about how they can comply with their Privacy Act obligations.Assist y
196、ou in responding to requests for information.How we can help youContactHow we can help youHayley MillerPartner D+64 9 915 3366M+64 21 870 UEMAAdvise you on whether your methods of obtaining consent to send commercialelectronic messages are adequate for the purposes of the UEMA.Prepare internal polic
197、ies and provide training on the UEMA to avoid staffbreaching it.Assist you in responding to investigations by the Department of Internal Affairs.Gambling ActReview your competition formats and terms to ensure they comply with theGambling Act sales promotion scheme.Advertising StandardsReview your ma
198、rketing material.Defend a claim for an alleged breach of the standards.Provide training on the standards to avoid staff breaching them.Contracting in New ZealandContracting in New ZealandDentons is highly-skilled,always solution-focused and really pragmatic.The team has a wealth of international exp
199、erience and skill-sets,having practised in different parts of the world.They care about diversity and inclusivity.Legal 500 Asia Pacific,2023Specialists in:Distribution,supply and customer contracts Terms of tradeCommercialisation and licensing arrangements Technology,data and Intellectual property
200、arrangements and implicationsCommercial and online channels9 partners11 professionalsRanked with:Key points about contract law in New ZealandContract law is at the heart of all commercial transactions in New Zealand.New Zealands contract law has its origins in common law,but has been subject to prog
201、ressive legislative codification,particularly since the middle of the 20th century.The Contract and Commercial Law Act 2017(CCLA)is the central piece of legislation applying to contracts that are subject to New Zealand law but there remains many matters which are covered on by the common law rules,i
202、n other words“judge made law”.The CCLA applies in full to all contracts entered into after 1 September 2017.Except for certain minor changes in legal effect,the CCLA also applies to contracts made before 1 September 2017.The detailChoice of Law for International ContractsDetermining which countrys l
203、aw is applicable to an international contract can have important implications for when and how a contract was formed,whether the parties had capacity to enter into the contract,whether the contract conferred benefits on third parties and even whether the contract was formally valid for the particula
204、r transaction.A choice of law made by the parties in their contractual arrangements will generally be respected by the Courts,provided that the choice is genuine and legal,and does not need to be avoided for reasons of public policy.When the parties have not expressly chosen an applicable law,the Co
205、urts will need to determine what law applies based on the details of the contract and the surrounding circumstances.The Court will seek to establish which legal system has the closest and most real connection with the contract in question.The Court may consider factors such as where the contract was
206、 concluded,where performance of the contract was to occur,where the parties reside and the subject matter of the contract.Any substantive dispute between the parties will generally not be able to be resolved until the applicable law has been determined.For this reason,it is advisable to include a ch
207、oice of law clause in all international commercial agreements.The United Nations Convention on Contracts for the International Sale of GoodsNew Zealand is a party to the United Nations Convention on Contracts for the International Sale of Goods(CISG).The CISG is an international treaty that has been
208、 signed by over 90 states.The purpose of the CISG was to harmonise the law applying to contracts for the international sale of goods.Generally speaking,the CISG will apply to contracts for the international sale of goods where both of the parties have their place of business in contracting states or
209、 where the rules of private international law lead to the application of the law of a contracting state.This means that,even if the parties have not made any choice of law,the CISG may automatically be the law applying to their contract.It is,however,possible to contractually agree to expressly excl
210、ude the application of the CISG.Before entering into an international commercial contract,it is important to consider which law should or would apply to the contract in question.We can help your business to ensure that the law applicable to the contract is certain and that it is consistent with the
211、commercial needs and expectations of the parties.Settlement of disputesThe default dispute resolution mechanism for international commercial transactions is international litigation.Where the parties have not specified which countrys courts will have jurisdiction over matters arising from the contra
212、ct,a New Zealand Court will first need to determine whether or not it has jurisdiction to hear a particular matter.Therefore,it is generally preferable to ensure that any international commercial agreement has a well-drafted choice of forum or alternative dispute resolution clause.An international c
213、ommercial contract can also specify that one or more method of international dispute resolution mechanisms will be used to resolve any disputes which arise under the contract,for example,mediation or arbitration.The New Zealand Courts will generally honour such clauses and refuse jurisdiction where
214、the parties have chosen an alternative method of dispute resolution.However,it is important to ensure that such clauses are drafted carefully to avoid any potential for a dispute about what the applicable dispute resolution mechanism is.Doing Business in New Zealand 45ContactHow we can help youHayle
215、y MillerPartner D+64 9 915 3366M+64 21 870 Drafting,reviewing and modifying internationalcommercial contracts to avoid common pitfallsthat can be costly later down the track.Drafting,negotiating and advising on a range ofcommercial arrangements,including distribution,supply and customer contracts an
216、d terms of trade.Resolving commercial disputes of all sizes.Corporate law in New ZealandCorporate law in New ZealandThey are solid very committed,hard-working and easy to work with.Corporate and Commercial,Chambers and Partners Asia Pacific,20239 partners19 professionalsRanked with:Specialists in:Re
217、gulatoryCorporate StructuringPrivate Equity and Capital RaisingCorporate GovernanceDistribution and SupplyProcurement and OutsourcingBrand Promotion and SponsorshipsMergers and AcquisitionsJoint Ventures and Strategic AlliancesFranchisingWarranty and IndemnityInsuranceSpecialists in:RegulatoryCorpor
218、ate StructuringPrivate Equity and Capital RaisingCorporate GovernanceDistribution and SupplyProcurement and OutsourcingBrand Promotion and SponsorshipsMergers and AcquisitionsJoint Ventures and Strategic AlliancesFranchisingWarranty and IndemnityInsuranceKey points about corporate law in New Zealand
219、Overseas entities proposing to set up business in New Zealand have four main structures available to them:register a branchform a subsidiary companyacquire an existing New Zealand companyform a partnership,including alimited partnership.The most effective way for an overseas company to operate in Ne
220、w Zealand will depend upon the nature of its intended business activities in New Zealand,the method of cooperation intended to be formed between the overseas company(or its New Zealand registered entity)and local partners,as well as each methods respective tax consequences.Doing Business in New Zeal
221、and 49The detailRegistered branchAn overseas company wishing to register a branch in New Zealand must:reserve its name with the Registrar ofCompanies,andfile an application for registration within tenworking days of commencing business inNew Zealand.Australian companies wishing to register a branch
222、in New Zealand benefit from:an information sharing arrangementbetween the Companies Office and theAustralian Securities and InvestmentsCommission(ASIC),andreduced compliance requirements on anongoing basis.Forming and registering a subsidiary companyCompanies incorporated in New Zealand are register
223、ed under the Companies Act 1993(the Act).Some of the major features of the Act are set out below.Directors and shareholdersA company must have:a nameat least one director living in New Zealand orliving in an enforcement country and beinga director of a company incorporated in thatenforcement country
224、.At present only Australiahas been confirmed as an enforcement country.at least one shareholder.Unlike for directors,there is no residency requirements forshareholders.The rights and powers of theshareholders are laid out in the Act and maybe modified to the extent allowed by the Actby the companys
225、constitution(if it has one).Shareholders liability is generally limited tothe price payable for the shares for which they subscribe.The same person can be both shareholder and director.ConstitutionUnder the Act there is no distinction between a public or private company.Additionally,there is no obli
226、gation to have a constitution.If no constitution is adopted,then the provisions of the Act govern the conduct of the affairs of the company.Most companies elect to have a constitution in order to take advantage of certain powers not otherwise permitted under the Act,such as the ability to take out d
227、irectors and officers liability insurance.Each company must maintain registers of shareholders,directors,directors interests,and certificates given by directors and such other company records as directors and shareholders resolutions and financial statements,all of which must be kept at the companys
228、 registered office unless otherwise approved by the Registrar of Companies.CapitalUnder the Act,shares have no par value and there is no concept of nominal capital.There may be different classes of shares.Financial assistance to purchase shares and,if expressly authorised by the constitution,share b
229、uybacks are permitted if certain procedural requirements are followed.One procedural requirement is the directors must certify that the company passes the solvency test.Creditors are protected from inappropriate reduction of capital by the need for the directors of the company to certify that the co
230、mpany will remain solvent at the time distributions are made to shareholders.Directors may be personally liable if a distribution is made when the company cannot pass the solvency test.ManagementIn New Zealand,the ownership and management of the company are distinctly separate.A director must be a n
231、atural person,and a shareholder can be 50 Doing Business in New Zealand a natural person or a legal entity.A natural person shareholder does not necessarily have to be a director,and vice versa.The board of directors is responsible for managing the companys business affairs.The board must keep minut
232、es of their meetings.Subject to a companys constitution,the Act sets out the methods by which a company may enter into contracts and other obligations.This method is dependent on the type of obligation and the form of the contract.There is no requirement for a company seal and most companies do not
233、execute documents under seal.Directors duties are set out in the Act.Where expressly allowed by a companys constitution,the Act also permits directors of wholly-owned subsidiaries or joint venture companies to take into account the interests of the holding company or the shareholder,in priority to t
234、he interests of the company itself.Importantly,the Act allows for directors to consider matters other than the maximisation of profit when determining whether an action is in the best interests of the company.The Act provides that environmental,social and governance(ESG)matters may be considered whe
235、n determining the best interests of the companyPublic disclosureThe Act and the Financial Reporting Act 2013 prescribe the requirements for companies to prepare,have audited and file with the Registrar of Companies financial statements.The requirement to audit and file will differ between companies
236、depending on factors such as the level of overseas ownership of the company,the size and scale(measured on the basis of revenue and value of assets)of the company and other relevant factors.Generally speaking,most New Zealand incorporated companies that are owned by large overseas persons and have a
237、 substantial business presence will need to prepare and file audited financial statements.Shareholder rightsUnder the Act,unless the constitution provides otherwise,shareholders have pre-emptive rights on the issue of new shares but not in respect of the transfer of shares.However,it is common for c
238、onstitutions of closely held companies to incorporate pre-emptive rights on the transfer of shares.Companies cannot undertake transactions with a value exceeding 50%of the gross assets of the company without approval by a special resolution(which requires the vote of at least 75%of shareholders).In
239、such cases,dissenting minority shareholders whose dissenting votes have been recorded may require the company to purchase their shares.Acquire an existing New Zealand companyShare sale versus an asset saleBefore commencing an acquisition it is important to decide on how the acquisition is structured
240、.The two most common types of structures are:acquisition of the shares in thetarget business;oracquisition of the assets of thetarget business.A share purchase is typically a simpler transaction as all contracts,employees and assets remain with the target business with only the ownership of the busi
241、ness shares changing.However,the downside to a share purchase is that a purchaser has to acquire all the assets of the business(and also the business liabilities)and is unable to cherry-pick those it wants.There are a range of factors to consider when structuring an acquisition so it is important to
242、 consult your legal and financial advisors before entering into a transaction.Merger or takeover proposal An overseas person considering merging with or buying a New Zealand company must be aware of the restrictions on business acquisitions contained in the Commerce Act 1986 and the Overseas Investm
243、ent Act 2005(OIA).If the New Zealand Doing Business in New Zealand 51company is listed on the New Zealand Stock Exchange,or has more than 50 shareholders,the Takeovers Code is also likely to apply.The Takeovers Code The Takeovers Code(Code)regulates the conduct of takeovers in New Zealand.The Code a
244、pplies to companies(Code Companies)which meet one of the following:are listed on the New Zealand Exchange(NZX)were listed on the NZX and have ceased to be listed for less than 12 months before the date of the relevant event referred to in the Code have 50 or more shareholders who hold voting rights,
245、and have 50 or more share parcels in a company that in the most recently completed accounting period and either or both of the following is true:The total assets of the company and its subsidiaries is at least NZ$30 million and/or the total revenue of the company and its subsidiaries is at least NZ$
246、15 million.The main feature of the Code(fundamental rule)restricts the ability of a person and that persons associates,to increase or acquire voting rights in a Code Company beyond 20%.Under the Code:a person who holds or controls less than 20%of the voting rights in a Code Company cannot acquire an
247、 increased percentage of voting rights if such an acquisition would put that person and their associates over the 20%threshold,unless such acquisition is by way of one of the permitted exceptions listed in the Code(and summarised below).a person already holding or controlling more than 20%of the vot
248、ing rights of a Code Company cannot acquire an increased percentage of voting rights other than by way of one of the permitted exceptions.once a person holds 90%or more of the shares in a Code Company,they become a Dominant Owner.Upon becoming a Dominant Owner:The Dominant Owner has the right to acq
249、uire all the outstanding shares The outstanding security holders have the right to sell their shares to the Dominant Owner.The Code does not distinguish between voluntary or involuntary increases in voting rights.Therefore,a person whose voting rights cross the 20%threshold by involuntary means(e.g.
250、a non-pro rata buyback,transfers by operation of law,or an undersubscribed rights issue),will be in the same position as if they had actively purchased shares,although some general exemptions allow a period for the holder to reduce their holding back to where it was.The Takeovers Panel is able to gr
251、ant exemptions from the Code where appropriate.Code permitted exceptions A full offer to acquire all the voting and non-voting equity securities in a Code Company will comply with the Code so long as the offer is fair and reasonable between all classes of shares held in the company.A partial offer t
252、o acquire a specific percentage of all voting securities will comply with the Code so long as the offer will have the effect of the offeror owning more than 50%of the voting rights in the company.A partial offer must be for the same percentage in each share class and be fair and reasonable between a
253、ll share classes.Shareholders of the target company may resolve by ordinary resolution to approve a particular issue of new shares or the acquisition of existing shares that would otherwise be restricted by the Code.The intended purchaser,and any other interested person,are not permitted to take par
254、t in the vote.Where a person has an existing holding of between 50%and 90%of voting rights,they are permitted to increase their holdings by up to 5%of the total voting rights in any one 12-month period.The maximum increase permitted is calculated from the lowest percentage of voting rights held by t
255、hat person in that 12-month period.52 Doing Business in New Zealand The Code sets out more fully the procedure as to what is required to be in the offer,what the target company must do upon receipt of the offer,and certain restrictions upon the offeror and the target company during this process.Part
256、nership and limited partnershipsPartnershipThe definition of partnership is provided in the Partnership Law Act 2019,as the relationship that subsists between persons(which can be companies)who carry on a business in common with a view to profit.The relationship between shareholders or members of ce
257、rtain entities,including a limited partnership,is not a partnership.Unlike companies,a partnership is not considered a separate legal entity.Each partner is liable jointly and severally for the liabilities of the partnership with no limited liability.This means that a claim made against a partnershi
258、p can be enforced against any partner in the partnership.The partnership relationship is ordinarily documented by way of a partnership agreement,which is governed by the Partnership Law Act 2019 and common law.Partners can,in writing,contract out of certain general provisions in the Partnership Act.
259、Limited PartnershipThe Limited Partnership Act 2008 introduced a limited partnership model into New Zealand similar to those in some Australian states,Delaware,and the Channel Islands.Effectively,the model provides investors with the protection of limited liability,with some of the flow-through tax
260、and confidentiality advantages of a partnership.A limited partnership must be registered with the Companies Office and must be composed of at least one general partner and at least one limited partner,both of which can be companies.General partners are:responsible for the management of thegeneral pa
261、rtnership.jointly and severally liable with the limitedpartnership for the debts and liabilities and forany wrongs or omissions of the partnership.General partners liability for the debts andliabilities is limited(subject to the partnershipagreement)to the debts and liabilities that thelimited partn
262、ership cannot pay.Limited partners are:passive investors and are not entitled totake part in management outside certainspecified activities.not liable for the debts and liabilities of thelimited partnership,provided that they donot take part in the management of thelimited partnership.Both general a
263、nd limited partners may make capital contributions to the limited partnership.Doing Business in New Zealand 53Structure your investment in the way that best suits yourbusiness model and investment plans.Advise on compliance and best practice,on all aspectsof a merger or acquisition,from initial plan
264、ning to post-completion,including undertaking due diligence,negotiating terms,providing regulatory advice(includingconsent applications to the Overseas Investment Officeunder the OIA),enabling ongoing project management,aswell as helping you understanding shareholder rights andnegotiate and resolve
265、disputes.Our Takeovers Code experts provide specialist advice tocompanies,investors,stock brokers,and other marketparticipants.We can help you to understand yourobligations,whether youre a Code Company,a substantialproduct holder,a holder of voting rights,or an offeror.Navigate the Financial Markets
266、 Conduct Act and ongoingcompliance with relevant listing rule and market participantrequirements to become listed on the NZX.ContactHow we can help youChris ParkePartner D+64 9 375 1157M+64 21 382 Corporate restructuring and insolvency in New ZealandThe team regularly acts for banks,insolvency pract
267、itioners and creditors on a range of issues,including receiverships,administrations and risk management.The firm is especially respected for its work on insolvency mandates arising in the construction and property sectors,and for advising on debt recovery.Restructuring and Insolvency,Chambers and Pa
268、rtners Asia Pacific,20233 partners5 professionalsRanked with:Specialists in:Receiverships Administrations Liquidations Restructuring solutions Creditors compromises Debt recovery Securities enforcement Priority disputes Advice on director liability Voidable transactionsCorporate restructuring and in
269、solvency in New ZealandKey points about corporate insolvency law in New ZealandThere are three key procedures which are used in corporate restructurings and insolvencies in New Zealand:Liquidation;Receivership;andVoluntary administration.Other options available in New Zealand include formal and info
270、rmal compromises.In rare circumstances,statutory management may also be appropriate.Doing Business in New Zealand 57The detailLiquidationA liquidator is appointed to wind up the affairs of a company.The principal duty of a liquidator is to take possession of,protect,realise,and distribute the assets
271、(or their proceeds)of the company to its creditors and to distribute any remaining surplus to the companys shareholders or whomever else is entitled to such surplus.The process of liquidation is governed by Part 16 of the Companies Act 1993.A liquidator can be appointed by the High Court,by special
272、resolution of shareholders,by a resolution of directors upon the occurrence of an event specified in the companys constitution,or by resolution of the creditors passed at the watershed meeting.Once a company is in liquidation,an unsecured creditor cannot,without the permission of either the court or
273、 the liquidator,start or continue any legal proceedings against the company or its property,or start or continue to enforce rights against the property of the company.Liquidation does not prevent secured creditors from exercising their rights,although certain preferential creditors are paid before g
274、eneral security holders from the proceeds of inventory and accounts receivable.A liquidator will investigate the affairs of the company(to the extent that funding allows)and may bring claims for the purpose of recovering additional funds to increase the overall dividend to creditors.The liquidator m
275、ust give regular reports to every known creditor,shareholder,and to the Registrar of Companies.A liquidation is complete when the liquidator sends a final report and various other documents to all creditors,shareholders and the Registrar of Companies.ReceivershipReceivership is the appointment of a
276、receiver under the terms of a security agreement to manage or realise secured assets for the benefit of the security holder that appointed the receiver.In some circumstances,receivers can also be appointed by the Court.The legislation governing receiverships in New Zealand is the Receiverships Act 1
277、993.In a private receivership,assets are realised by the receiver for the benefit of the secured creditor who made the appointment of the receiver,but certain preferential creditors are paid before general security holders from the proceeds of inventory and accounts receivable.A receiver is required
278、 to give public notice of their appointment and must provide reports during and at the end of the receivership.Voluntary administrationVoluntary administration involves the appointment of an administrator to assess a companys affairs and options going forward.Voluntary administration is governed by
279、Part 15A of the Companies Act 1993.The objective of voluntary administration is to provide for the affairs of an insolvent company,or one that may become insolvent,to be administered in a way that:maximises the chances of the company,or asmuch as possible of its business,continuing inexistence;orif
280、it is not possible for the company or itsbusiness to continue in existence,would result ina better return for the companys creditors thanwould result from an immediate liquidation.An administrator may be appointed by the Court,a liquidator(if the company is in liquidation),the companys directors,or
281、a secured creditor holding a charge over the whole,or substantially the whole,of the companys property.If a company is in liquidation,the appointment of an administrator will suspend the liquidation.The appointment of an administrator does not remove a receiver from office.58 Doing Business in New Z
282、ealand Once an administrator has been appointed,a moratorium comes into force,preventing anyone from bringing or continuing proceedings against the company or enforcement processes in relation to the companys property without the administrators consent or court permission(with some exceptions).This
283、is to give the company breathing space to allow the administrator time to assess whether the company should enter into a deed of company arrangement(an agreement setting out how the company will be run and how it will pay creditors),be placed into liquidation,or come out of administration.Doing Busi
284、ness in New Zealand 59ContactHow we can help youJames McMillanPartnerD+64 9 375 1154M+64 27 432 Our team are specialists in all areas of restructuring and insolvency,including:Acting for insolvency practitioners in relation to all aspectsof their appointments,including advising on prioritydisputes a
285、nd claims against directors and other parties.Acting for creditors in relation to claims and other matters.Acting for directors and business owners on turnaroundand liability issues.Advising foreign creditors and foreign insolvencypractitioners on cross-border insolvency issues,andassisting them wit
286、h recovery of assets in New Zealand.Employment and Health&Safety in New ZealandEmployment and Health&Safety in New ZealandDentons is in demand for its depth of expertise in health and safety regulatory compliance,including dealing with investigations by regulatory bodies.The firm advises on various
287、aspects of employment law,including restructurings,contractual issues and performance management,while also boasting extensive litigation experience.Employment,Chambers and Partners,2023Specialists in:Occupational Safety and Health Employment relations Investigations Collective bargaining Dispute re
288、solution4 partners10 professionalsRanked with:Employment relationships in New Zealand are structured around binding contracts negotiated and entered into between employers and employees,but with their terms and the legal framework extensively regulated by legislation.Key points about employment law
289、in New ZealandDoing Business in New Zealand 63The detailThe Employment Relations ActThe Employment Relations Act 2000(the Act)is the principal statute that governs all employment relationships and agreements.The key features of the Act are:the underlying duty of good faith,which is acrucial element
290、of the employer/employeerelationship,including bargaining for individualand collective employment agreements;unions have rights of access to workplaces inrelation to union matters and workplace safety;employers must hold a copy of signedemployment agreements,and maintain accurateand up-to-date wage
291、and time records;minimum entitlements and standards must beincluded in employment agreements;certain categories of vulnerable employeeshave special protections if an employer sells,transfers,or contracts out all or part of itsbusiness(which may include a right to transferto a new employer);workers m
292、ay request flexible workingarrangements,and employers must considerrequests in good faith;andall employees may raise a personal grievanceif they consider the employer has breached itsobligations,and these can be pursued aslegal claims.There are a number of other statutes which contribute to the land
293、scape of employment law,among which are the Minimum Wage Act 1983,the Human Rights Act 1993(which contains laws against discrimination on a range of protected characteristics),the Holidays Act 2003 and the Health and Safety Work Act 2015.TerminationGenerally,an employer cannot terminate employment e
294、xcept for cause,for example where the employees position is redundant,or for poor performance or misconduct.Any termination must be the act of a fair and reasonable employer,both substantively and procedurally.This generally requires employers to investigate any concerns,to raise concerns with the e
295、mployee,and provide the employee an opportunity to respond(with a representative or support person present if they wish).The employer should genuinely consider the employees response prior to making a decision.An employee can terminate an employment relationship by resigning,provided that they give
296、notice as required by their employment agreement.RedundancyRestructuring the business may result in an employee being dismissed.Employers are entitled to make employees redundant as part of their right to manage their business as they see fit(provided they act fairly and reasonably).The Act protects
297、 the jobs of certain vulnerable employees during a restructure,ensuring their employment is maintained even where the work is transferred to another business.Dispute resolution and personal grievancesEmployees can raise a personal grievance against their employer on a number of grounds,including whe
298、re they believe that they have been subject to an unjustified disadvantage,or if they have been unjustifiably dismissed.The Act encourages employers and employees to attend mediation to resolve any disputes in the first instance.If unsuccessful at mediation,the parties can file proceedings in the Em
299、ployment Relations Authority,which makes decisions based on the merits of a case.If a party is dissatisfied with an Authority determination,they can appeal to the Employment Court.The Employment Relations Authority and the Employment Court can order a range of remedies,including reinstatement to the
300、 employees former position,payment of lost wages,and compensation for injury to feelings or loss of another benefit.Reinstatement is the primary remedy under the Act,and so where an employee asks to be reinstated,64 Doing Business in New Zealand the Authority or Court will respect that wish where pr
301、acticable and reasonable to do so.Collective bargainingThe Employment Relations Act actively promotes collective bargaining,however individual agreements are permitted and are common outside traditionally unionised industries.Unions have exclusive rights to represent their members in matters relatin
302、g to the collective interests of the workers,including collective bargaining.In accordance with specific procedural requirements,unions may call employees out on strike to garner leverage during collective bargaining,or in relation to health and safety concerns.Union membership is optional,and emplo
303、yees who are not members will remain on individual employment agreements.Union members can also be employed on individual employment agreements,provided the terms are no less favourable than those of the collective agreement.The Fair Pay Agreements Act allows employees to initiate bargaining with em
304、ployers for a minimum standard for all employees within that industry.Employees can apply to initiate the bargaining process if there is agreement from at least 10%of their workforce,or 1000 staff.If a successful agreement is reached between the bargaining parties,the Fair Pay Agreement will need to
305、 be vetted and approved by the Employment Relations Authority before being brought into force by the Ministry of Business,Innovation and Employment.Once in force,the Fair Pay Agreement will apply to all employees within the industry.DiscriminationEmployers have a number of obligations under the Huma
306、n Rights Act 1993,including not to discriminate against employees on any of the following grounds:SexMarital statusReligious or ethical beliefsRaceEthnic or national originsDisabilityAgePolitical opinionEmployment statusFamily statusSexual orientation.Discrimination claims will commonly arise out of
307、 situation involving:Job applicationsThe drafting of terms and conditions ofemploymentThe provision of trainingPromotions or transfersTermination of an employees employmentThe retirement of an employee.Key points about Health and Safety in New ZealandThe Health and Safety at Work Act 2015(HSWA),impo
308、ses obligations on a range of people and entities in respect of work,workplaces,and people in or near places of work.The business or other organisation that is doing the work is known as a PCBU.The PCBUs and any other persons with management or control of a workplace(whether they are an employer or
309、not),are primarily Doing Business in New Zealand 65responsible for the health and safety of the workplace and those within it,or otherwise affected by the work.Each PCBU must ensure,so far as is reasonably practicable,that the health and safety of workers,and others within the vicinity of the place
310、of work,is not put at risk.PCBUs that exercise certain activities,for example,if they are involved in the design,manufacture or supply of plant,substances and structures,have further specific obligations in relation to those activities.PCBUs must engage with workers on matters that could affect thei
311、r health and safety and provide a reasonable opportunity for workers to participate in improving health and safety.Additionally,all PCBUs(regardless of size or industry)are required,when requested by workers,to hold elections for health and safety representatives and committees.Individuals in senior
312、 governance and leadership positions with significant influence over the management of a PCBU have personal duties as officers.Officers must exercise due diligence to ensure that the PCBU complies with its health and safety duties described above.The extent of the officers duty depends on the nature
313、 of the business,and the officers position and responsibilities within it.Workers have duties to take reasonable care for their own health and safety,the safety of others,and to comply with a PCBUs reasonable health and safety instructions,policies and procedures.WorkSafe New Zealand is the New Zeal
314、and health and safety regulator.Failure to comply with duties under the HSWA is a criminal office,investigated by WorkSafe and prosecuted in the District Court.The Act provides strong penalty provisions,with fines of up to NZ$3 million for companies,and up to NZ$600,000 and/or five years imprisonmen
315、t for individuals.Accident compensationNew Zealand has a comprehensive no-fault system of compensation provided by the Accident Compensation Act 2001(ACA).Those who suffer personal injuries are entitled to cover under the Act,regardless of whether the accident occurred in the workplace.However,they
316、are barred from claiming damages arising from their injury.Most physical injuries are covered,however mental injuries are only covered in very limited circumstances.The bulk of benefits provided under ACA constitute payments for medical treatment and weekly compensation.The scheme is administered by
317、 the Accident Compensation Corporation(ACC)and funded by levies paid by employers,employees,and self-employed people.Employers have two categories of obligations in respect of compensation:1.The payment of levies into the work account inrespect of every employee to cover the cost ofwork accidents;an
318、d2.The payment of 80%of wages to the injuredemployee for the first week an employee has offwork as a result of an accident.The levies that an employer must pay depend on the category of work undertaken.The levy determined by ACC may be adjusted in light of an audit of a particular employers safety m
319、anagement practices and the Accident Compensation(Earners Levy)Regulations 2015.This is intended to promote good health and safety practices.ACC is required to consult the public before implementing any changes in rates and regulations,and before making any recommendations to the Government.Deductio
320、ns for tax,Accident Compensation premiums,and KiwiSaverEmployers are required to deduct PAYE(Pay As You Earn)tax from employees remuneration.This includes deductions for income tax and accident compensation premiums(representing employee contributions to fund ACC cover).With limited exceptions,emplo
321、yers are also obliged to enrol employees into a compulsory pension savings scheme called KiwiSaver,and to make deductions from employee remuneration for that purpose as well as offering an employer contribution.Currently,employees must contribute a minimum of 3%of their salary or wages,with the empl
322、oyer also required to make a 3%contribution on top.66 Doing Business in New Zealand Other than the employer ACC levy,and the minimum employer contribution to KiwiSaver,New Zealand does not currently have any payroll or other employment tax which employers have to pay over and above an employees sala
323、ry and wages.Employers must account for PAYE to the Inland Revenue Department.Failure to do so can attract penalties,and may amount to a criminal offence.Independent Contractors in New ZealandIt is possible for individuals to be engaged as contractors rather than employees.Such individuals are recog
324、nised as being in business in their own right and having an arms-length relationship with those engaging them.Consequently they do not receive employment entitlements.For tax,ACC,levies,and holidays entitlements,it is important to accurately distinguish between employees and independent contractors.
325、Independent contractors are responsible for their own tax obligations and not entitled to the rights and protections provided to employees.However,the status of an independent contracting arrangement can be challenged,and it is the true nature of the relationship rather than that which is described
326、in any agreement which will be assessed by the courts.Those using contractors should bear in mind that if the status of the agreement is challenged,an employment relationship may be determined to exist for tax and entitlement purposes even if that was not intended by either party.Jurisdiction and ov
327、erseas employersForeign companies may employ staff in New Zealand but are required to be registered on the Companies Office Overseas Register if they are carrying out business in New Zealand and intend on hiring employees for that purpose.Overseas companies need to be aware that their activities in
328、New Zealand could lead to classification as a permanent establishment,requiring them to meet business tax obligations on any income-earning activity.Generally,employers may choose which law applies to any employment agreement.However,notwithstanding any different choice of law,employees who are base
329、d in New Zealand will generally be entitled to the minimum standards and benefits extended by domestic employment legislation.It is the employers responsibility to ensure that all of its employees are legally entitled to work in New Zealand.Employees who are not citizens or residents will generally
330、need a work visa.Such visas may limit the type of work undertaken by the worker and the length of any work in New Zealand.Foreign employees are generally subject to the same employment laws and tax requirements as domestic staff.Employers are subject to prosecution and/or the imposition of fines if
331、they employ a person who is not entitled to work under the Immigration Act,or in a manner inconsistent with that persons visa or fail to provide employment documents when requested by an Immigration Officer.Employment law post CovidThe last of the Covid public health requirements in New Zealand were
332、 removed by the Government in August 2023.The onus is now on employers to determine what action,if any,they take to deal with Covid risks,bearing in mind that both health and safety obligations and the statutory duty of good faith apply to their dealings with employees in this area.Doing Business in
333、 New Zealand 67We have a large specialist employment law team with deep experience and expertise in assisting businesses at the point they are considering their first employee or contractor engagements in New Zealand,and then in supporting their actual set up.Please feel free to contact us to discuss your plans and how we can help.ContactHow we can help youJames WarrenPartner D+64 9 375 1199 M+64
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