Strategi Limited (Strategi) reports that an increasing number of offshore companies are considering establishing a presence in New Zealand, then using that to raise funds from investors around the world. David Greenslade, the Managing Director of Strategi, attributes this interest to New Zealand’s new 0% PIE tax rate for offshore investors, the relative ease and simplicity of doing business in New Zealand, our relatively low level of corruption, and the low cost of professional advice fees. Add to this the fact that we are a fantastic place to visit or live in, and you have an almost perfect recipe for setting up a New Zealand-based financial services company.”
However, it is not all plain sailing. New Zealand now has a heightened regulatory regime that is long overdue. It is not as onerous or draconian as that of many other jurisdictions, reports Greenslade, but it is certainly going to be pretty vigilant, especially towards any company that has the slightest taint of being associated with financing terrorism or money laundering. In New Zealand, FMA subscribes to IOSCO Standards and is particularly focused on protecting the investor and raising the professionalism of the financial services industry.
A foreign entity that plans to establish an operation in New Zealand, and provide financial advice, will need to seek quality legal and accounting advice.
Once the legal structure (usually a limited liability company) has been established, then the new company will need to:
- Apply to be registered as a financial service provider.
- Join an approved dispute resolution scheme or the reserve scheme.
- Apply for QFE (Qualifying Financial Entity) status. This involves the development of an ABS that describes for the FMA how the business will operate and what systems and processes are in place to prove that the customer is protected and that the business complies with all relevant legislation, regulation and the Code.
Strategi is active in the QFE and the ABS space and works with a multitude of companies (normally after a referral from their lawyer or accountant) to help them develop their ABS and obtain QFE status. Strategi is unique in this field as it is a specialist in providing both compliance and training services and support to the financial services industry, both in New Zealand and overseas.
For more information please phone Strategi on +64 9 414 1300 or contact us via email.