A timely reminder to ensure all purchasers are compliant with the Overseas Investment Act
An overseas investor has been convicted under the Overseas Investment Act and fined $100,000 for falsifying information and obstructing an investigation by the Overseas Investment Office (OIO).
Although people have been fined under the Overseas Investment Act, this is the first conviction. The case reflects the strengthening of the OIO’s enforcement team and shows the OIO is not afraid to use its powers to convict foreign buyers who breach the Overseas Investment Act.
In 2016, Dr Won Joo Hur, a Korean national, paid a substantial deposit for a property in Helensville. Dr Hur did not have the required consent under the Overseas Investment Act to complete the purchase. In order to complete the sale, a company associated with his Auckland-based lawyer, Dr Jaeho Choi (who is set to be the second person convicted under the OIA) purchased the property on Dr Hur’s behalf.
The transaction required consent under the Overseas Investment Act because the company that purchased the property did so on behalf of Dr Hur. Dr Choi and Dr Hur then created false loan agreements to support their story and submitted those documents to the OIO. Providing this false information to the OIO was a clear breach of the Overseas Investment Act.
Vanessa Horne, the Group Manager for the OIO, stated “we take enforcing New Zealand’s overseas investment rules very seriously and we will continue to take strong action against anyone who breaks the rules.”
If you have any questions about investing overseas then please do not hesitate to contact one of the Todd & Walker Law Overseas Investment team members:
We are experts in managing the consenting process under the Overseas Investment Act from inception to completion, as well as responding to concerns imposed by the OIO following acquisition. Find out more information about our overseas investment services here.