The new category is called the Active Investor Plus Category (AI+). The focus is on direct investment into New Zealand firms to assist them to become more internationally competitive. It replaces both the Investor 1 (“Investor Plus”) and Investor 2 categories. The existing investor categories were closed to new applicants on 27 July 2022 and the new category will open on 19 September 2022. Those submitted before 27 July 2022 are not affected by the closure and will be assessed under previous visa settings.
Full details are yet to be announced at time of writing (August 2022) but here’s what we know so far:
- AI+ replaces off acts both the Investor 1 (NZD $10m minimum investment ) and the Investor 2 categories (NZD $3m minimum investment).
- AI+ will see an increase to the minimum level of funds required from NZ$3 million to $5 million minimum along with a change in the type of investments that need to be made.
- The aim is to attract active investment, where those willing to invest solely and directly in to NZ businesses can do so with a minimum of NZD$5.0 million and those looking at more passive or indirect investments will need to commit a higher amount of up to NZD$15 million.
- Different investment types will be given different weightings. We don’t yet have the details of the weightings but the announcement by the government indicated that those making indirect investments will have to do invest $15 million.
Bonds and property are gone
Two very important changes are being made to the permitted types of investments:
- Bonds (government and private) are being removed as an acceptable investment.
- Property is being entirely removed as an acceptable investment.
Less weight given to indirect investment
This category will give lower weightings for indirect investments, such as private equity or venture capital funds (2x) and listed equities and philanthropy (1x). It also limits the scope for indirect investment by capping investment in listed equities to 50% of total investments. See Immigration New Zealand’s announcement for more information.
Currently, niche investment advisors are well set up to advise on bonds and equities. The somewhat volatile economic situation means that investors will need to obtain quality advice on any companies that they choose to invest in.
The new category will offer a 3 year window in which to make the required investments with a 4 year investment period following the investments being made.
There will be a slight increase in the English language requirement to IELTS (International English Language Testing System) level 5. “Modest user, … has a partial command of the language and copes with overall meaning in most situations.”
Time in New Zealand
Investors will need to spend at least 117 days, or around a month a year, in New Zealand over the four-year investment period. This is an increase from 88 days in the previous Investor 1 category but is a decrease in the requirement for investor 2 which is either 146 days in NZ in each of years 2, 3, and 4 or 438 days over the entire 4 year investment period.
Update to follow
We’ll provide an update as soon as detailed instructions are released.
Pacific Legal already acts for many clients who make direct investments into New Zealand companies. We have excellent connections with accountants and financial advisors and will be well placed to assist you with this new category.
Contact us today.