Thursday, 22 July 2021, 1:58 pm
The Auckland High Court has ordered Clevedon Kawakawa
Road Limited (CKRL) to pay $160,000 in penalties and $15,000
in costs for not seeking approval for a sensitive land
purchase it made on behalf of an overseas
investor.
This is the first time the court has
considered a penalty against an associate of an overseas
investor.
In February 2013 businessman Mr Zhaorong Mai
agreed to purchase two adjoining properties totalling just
over 87 hectares in Clevedon. The land is categorised as
sensitive land as it is non-urban land exceeding five
hectares and one of the properties adjoins the foreshore at
Kauri Bay and Kahuru Point in Auckland.
Mai nominated CKRL to complete the purchase before the transaction was settled. CKRL told the court it acted as Mai’s associate when it purchased the land and that it failed to seek Overseas Investment Office (OIO) consent, which breached the Overseas Investment Act 2005. Justice Sarah Katz said there is a “strong need” to deter any breaches of the act as they have the potential to alienate sensitive land, that could make it difficult to monitor or detect. OIO Group Manager Anna Wilson-Farrell said the regulator would pursue associates for breaches of the act as actively as overseas investors directly making purchases.
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The Auckland High Court has ordered an overseas investor to pay a penalty of $49,000 and $15,000 in costs for failing to get consent from the Overseas Investment Office (OIO) before entering a long-term lease.
This is the third court ordered penalty decision for breaches of the Overseas Investment Act in recent weeks, and the first court case involving an overseas investor leasing land in New Zealand.
Justice Edwards said “breaches involving leases should not generally be regarded as less serious than those involving the purchase of freehold land”.
In 2014, Mr Bin Zhao (the investor) agreed to buy 20.5 hectares of land in Coatesville for $6 million. The purchase agreement was conditional on OIO approval, however, approval was not sought and the sale did not go ahead at the time.
auckland scoop co nz » First Penalty Against An Overseas Investor Leasing Land Without Consent scoop.co.nz - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from scoop.co.nz Daily Mail and Mail on Sunday newspapers.