Onshore or Offshore Investments in New Zealand – Biotechnology vs NZOFC
New Zealand is an English-speaking, democratic Commonwealth country. It has a free market economy, political stability, a first-rate education system and strong research, business and entrepreneurial communities. New Zealand offers the foreign investor an opportunity for attractive onshore investment and a legal means of operating a New Zealand offshore finance company, NZOFC, on its shores. Onshore investments in New Zealand can be traded locally or linked to New Zealand’s robust export economy. Offshore investment in New Zealand will benefit from business opportunities and what are essentially bank customers around the world, but not in the country.
New Zealand is located in the south and west of the Pacific Ocean on two large islands. The majority of New Zealanders are of European descent and the most common language is English. It is a developed country with high international rankings for economic freedom, lack of corruption and education. International surveys of the world’s most liveable cities always see New Zealand’s urban areas at or near the top of the list. Its heritage from the British Empire is still evidenced by the fact that its head of state is Elizabeth II, Queen of England. The Queen is represented by the Governor-General, but administrative power rests in the hands of the New Zealand Cabinet.
New Zealand is well known in the business world for a culture of innovation and a stable political environment, especially when it comes to doing business. New Zealand consistently ranks highly in ease of doing business surveys. Various factors combine to make New Zealand a great place to invest. Specifically, there are a number of business areas in which New Zealand stands out. These are biotechnology and agricultural technology, creative activities such as digital and creative arts, fashion design, publishing, textiles and digital content.
Specialized manufacturing is thriving in New Zealand with companies specializing in clean technology, defence, light and heavy engineering, plastics, composites and metal technologies. Much of this stems from the country’s strong educational and research base.
New Zealand’s economic powerhouse is its food and drink industry, which has tripled exports over the past two decades. Its technical strength is manifested in the computer and software industry. New Zealand is involved in wireless infrastructure, health information technology, transportation, logistics and supply chain management technology, and communications technology with geospatial applications.
With a healthy environment and large forests, New Zealand has a thriving business for exporting timber and other forest products. The other aspect of New Zealand’s healthy environment and natural beauty is that the country is a tourist destination, attracting over two million visitors a year and billions of tourism dollars.
During the wave of deregulation that swept many developed countries in the 1980s, New Zealand developed consultancy services to help the business and social environment adapt. These advisory services are particularly useful for those who wish to invest onshore in New Zealand or establish and offshore business licensed and based there. Whether investing in world-class biotech research focused on genomics, reproduction, cloning or molecular techniques aimed at increasing animal productivity, New Zealand has a local industry ready to assist the interested investor.
For those interested in international business but with New Zealand as a base, there is one particularly attractive option. A bank is not a bank. This is New Zealand Offshore Finance Company, NZOFC. These types of operations can accept interest-bearing deposits, make loans, offer credit and debit card services, provide trust services, and much more. NZOFC can effectively function as an offshore bank. However, it cannot do business in New Zealand. Also, since it is governed by a different set of laws compared to banks, it cannot be called a bank. An attractive aspect of the NZOFC is that it has no capital requirements and is not subject to regulation by the central bank of New Zealand.
Useful information for investors is that companies doing business in New Zealand are generally taxed. However, a New Zealand special purpose vehicle that is an offshore company can be set up as the trustee of a non-resident trust in New Zealand. This type of offshore business arrangement is not taxed in New Zealand, except to the extent that the income is received in the country of New Zealand.
As with many offshore companies, a New Zealand international business company typically does business worldwide, holding bank accounts and investing anywhere outside of New Zealand. Such a business will be a tax-free offshore company.
Once registered, the company is usually free to do business, open bank accounts or invest anywhere in the world. If a company wishes to take advantage of the type of asset protection features often available overseas, connecting the business to the trust is beneficial.
If an investor is interested in a bank that is not a bank, namely a New Zealand offshore finance company, such an institution can be licensed and established by anyone, regardless of nationality. Directors do not need to be resident in New Zealand, although it is not unusual for an NZOFC to have at least one shareholder, officer or manager who is a New Zealand resident, just because sometimes there may be issues that are more easily dealt with by someone physically present in the country.
When investing in New Zealand or choosing to license an offshore company in New Zealand, the investor will usually want to consider what business opportunities are available onshore as well as offshore. To the extent that the tax advantages or asset protection and privacy features of an offshore business are important, business principals may choose the full “offshore” route. To the extent that New Zealand domestic business opportunities are attractive, principals will be able to seek advice on onshore investment opportunities rather than overseas.
#Onshore #Offshore #Investments #Zealand #Biotechnology #NZOFC