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NEW ZEALAND GAZETTE, No. 123

15 NOVEMBER 2007

Matters for Consideration

28. Advice to Ministers must specify whether a view or value attributed to New Zealanders is one that may be attributable to all New Zealanders or specifically to a group of New Zealanders and should include but not be limited to:

(a) The Purpose of the Act

In making its recommendations to Ministers, the advice must take into account the purpose of the Act.

(b) Protection

Advice that considers the purchase of special land for the purpose of protection should consider the costs, benefits, and effectiveness of providing this protection through ownership. Some factors that advice should consider include but are not limited to:

i Protection of indigenous biodiversity and valued exotic species and their habitats

The regulator may recommend that special land be acquired in order to protect or enhance significant habitats for trout, salmon, wildlife and/or significant indigenous vegetation and fauna. Where the regulator recommends that Ministers acquire the special land, the regulator must advise Ministers in what way the acquisition will protect or enhance such areas.

ii Protection of public access and use

The regulator may recommend Crown acquisition of special land for the purpose of protecting or promoting public use of or access to special land. This advice should consider the feasibility of providing for public access, and the size of the group or portion of New Zealanders that are reasonably likely to access or use the land. Where there is currently no provision made for access to the special land, or to travel along the edge of the special land (special land is in most cases below the high water tine)¹, the regulator should note the potential costs (both present and ongoing) associated with the provision, protection, and maintenance of public access across, along, or to special land.

iii The interrelationship with the surrounding area

The acquisition of special land provides the Crown, as owner, with rights only within that area section of special land. Where special land has been acquired for the purpose of protecting a specific characteristic of that land, the regulator should consider the interrelationship between the land in question and the surrounding land. Advice should recognise when this interrelationship may compromise the ability of the Crown, as an owner, to protect the sensitive characteristic that acquisition is supposed to protect.

iv The cost effectiveness and purpose of protection

The regulator’s advice should consider in a qualitative sense whether ownership is likely to be the most cost effective form of protection of the special land and whether ownership can achieve the purpose for which the land might be acquired. For this reason the regulator should consider and include in the advice whether there are any more effective protective mechanisms (in addition to or apart from Crown ownership) which could be utilised, for the Ministers’ consideration.

(c) Costs and Potential Associated Liabilities

Advice to Ministers must consider the costs of acquiring the land and whether ownership of the land may bring liabilities that outweigh the estimated benefits of ownership. Costs include the cost of acquisition and ongoing or associated costs, including contingent liabilities. Examples of such ongoing costs include, but are not limited to:

• the cost of monitoring and maintaining the use of the special land;
• costs associated with repairs, maintenance and management of special land;
• costs associated with clean up of pre-existing contaminates, and any other environmental or hazardous substances or structures; and
• the cost of regulatory compliance.

(d) The Public Interest

Advice to Ministers should consider whether the acquisition is in the public interest, by considering whether the overall benefit of acquiring the special land exceeds both the cost of purchasing the land and any associated liabilities.

(e) Information About the Overseas Investment Transaction

Advice to Ministers should consider the details of the substantive application. Whether special land has been offered to the Crown in accordance with the regulations is only one of the factors that must be considered by Ministers in determining whether an overseas investment is likely to benefit New Zealanders. Thus advice should place the public interest in acquiring special land in the context of the wider benefits that the overall investment is likely to provide to New Zealand. Relevant information could include:

• to whom the land will be sold;
• the size and nature of the investment;
• past ownership history of the land (including special land);
• whether the special land constitutes a significant proportion of the investment; and
• whether the investment may create significant economic benefits to New Zealand or New Zealanders.

Consultation

29. The regulator must consult with the Department of Conservation in preparing advice on decisions relating to special land, unless there is clearly no reason to do so. The regulator should clearly specify the time frame by which comments are to be provided, taking into account the time limits as set out in the Regulations. If no comments are received within that time frame, it can be assumed that the Department of Conservation agrees with proposed advice.

Revocation of Previous Letter

30. The Ministerial directive letter dated 1 August 2005* is revoked on and from the date this Ministerial directive letter takes effect.

Date Letter Takes Effect

31. This Ministerial directive letter shall come into effect on and from 31 October 2007.

Yours sincerely

HON. DR MICHAEL CULLEN, Minister of Finance.

¹ Exact definitions of what land is included within foreshore, seabed, river and lakebed are included in the Overseas Investment Act 2005.

*New Zealand Gazette, 11 August 2005, No. 123, page 3017