It’s always exciting when you’re thinking about expanding your business, and if you’re considering increasing your presence across the Tasman, you probably have a lot of questions. Private Box is here to help.
We’ve outlined a few of the legal and practical issues you should be aware of below, including different company types in New Zealand and relevant legislation.
1. Company registers
New Zealand has two company registers: one for local companies and another for overseas companies. Which register you end up using depends on whether you want to transfer your company’s incorporation to NZ, open a subsidiary company, or open a branch.
Here’s a quick overview:
If you want to open a New Zealand branch without giving up your Australian incorporation, the Overseas Register is the appropriate register.
The good news is that during the registration process you can import a lot of information from the Australian Securities and Investments Commission (ASIC) rather than having to provide records again.
ASIC provides details of your directors to the Companies Office, and it also provides a copy of your company constitution.
You can use your Australian Company Number (ACN) to retrieve the official name from the ASIC. Your official company name needs to be reserved at least ten days before you start business in New Zealand.
You also need to supply :
- Addresses for the person authorised to accept service and for communications in New Zealand (this could be a lawyer, accountant or Private Box)
- A principal place of business in New Zealand (Private Box can supply this also)
As an overseas company, you will need to file an annual return. This is not the same as a tax return—it’s more confirmation of your company’s details. You can choose any month of the year for this, apart from December and January.
New Zealand companies
If you want to transfer your incorporation to New Zealand or open a subsidiary company on the New Zealand Companies Register, you must have at least one director resident in New Zealand or Australia (the Australian resident director must also be a director in Australia).
Residential addresses may be checked, so it’s important to take this requirement seriously.
You will need to go through the process of formally incorporating your company and reserving a company name. Information about this can be found on the Companies Office website. You might like to speak to a lawyer who can guide you through this process. We can also help.
You will need to provide details about your directors and a share register, along with a company constitution. You will need:
- A registered office address
- An address for service and communications
- Addresses for your directors
2. Resident directors
If you don’t have a resident director, this arrangement is sometimes made on a contract basis. Your resident director might be a lawyer, an experienced business person, or another trusted professional. It’s important to get someone who is happy to abide by your company constitution. Private Box runs a quick introduction service, putting you in touch with potential candidates.
You might come across law firms or consultants who offer a nominee director service. Do your research before appointing a nominee director, as although they should be a director in name only, they can still potentially have a significant impact on the running of your company.
3. A New Zealand office
Private Box can provide you with a physical office address to fulfill your legal requirements – take a look at our website for pricing and different plans that may suit you.
At your office premises, you must keep records, including minutes of all meetings, a share register, certificates of directors, their full names and addresses, and all written communications to shareholders. You also need to keep accounting records and the share register at the premises.
If you’re looking to relocate physically, the major cities in New Zealand are Auckland, Wellington (the capital), and Christchurch (the largest city in the South Island).
With a population of just over 5 million people, New Zealand is small, but it’s not all the same. It’s a good idea to do some research into the industries and demographics of each area before you pick a location.
If you decide to go with an arrangement where your office is based from the premises of another business, think carefully about the set-up and the kind of experience your customers will receive.
4. Incorporating your company
To transfer your incorporation to New Zealand or to incorporate your subsidiary or new company, head to the Companies Office website.
The first thing you need if you want to incorporate a new company (or switch incorporation from Australia to New Zealand) is a Real Me Government login.
It’s a good idea to have someone familiar with New Zealand business practices to guide you through this process. Whether you’re trading as a New Zealand or an overseas company, you also need to acquire an IRD number for tax purposes.
5. Private or public?
Private companies: shares are held between a number of shareholders who usually know about one another. These companies are not listed on the New Zealand Stock Exchange.
There are some advantages to staying private. For instance, private companies can act strategically without needing to constantly think about disclosure obligations. But they can’t easily raise money from the general public.
Public companies: these companies are listed on the New Zealand Stock Exchange and are regulated by more extensive rules and regulations, for instance, around disclosure and financial reporting.
Just about anyone who is interested in your company can buy and sell stocks. If you want to be listed on the stock exchange, your company must be worth a minimum of $10 million.
6. Company liability
Under a limited liability company structure, the ownership of the company is held by one or more shareholders. Liability is limited to the amount of share capital the shareholder has contributed to the company; in other words, they are not personally responsible for paying debts the company can’t pay.
This type of company is very common in New Zealand, and you’ll see many company names followed by “Ltd”. While most New Zealand companies established under the Companies Act 1993 are “limited liability”, companies registered on the Overseas Register can be non-limited.
7. The legislation
Company law in New Zealand is governed by the Companies Act 1993. If you’re curious about any aspect of New Zealand company law, including:
- The registration of companies
- Rules for directors, officers, shareholders, and members
- Disclosure and reporting requirements
- Restructuring rules and insolvency rules
- Investigation and enforcement of the law
- Removal of companies from the Companies Register
Then the Act is a great place to start. Related legislation that you should be aware of includes the Financial Reporting Act 2013 and the Securities Act 1978. The Fair Trading Act 1986 and Consumer Guarantees Act 1993 will also shape aspects of how your business operates in New Zealand.
8. New Zealand domain names, phone numbers, and email addresses
New Zealand companies usually end in .co.nz or .nz—or even .kiwi! New Zealanders tend to be most comfortable visiting these websites.
If you have an Australian website already, it’s a good idea to tailor the site to show specific options for New Zealanders. Make sure you also have a New Zealand email address for your New Zealand-based company contacts.
Most companies have an 0800 number which is free for customers to call, and they also have a landline for business enquiries. It’s important to set up a good answering service or to have a receptionist who is willing to work according to NZ time.
9. Getting a New Zealand accountant and lawyer
Before setting up, it’s a great idea to engage the services of a New Zealand accountant, who can run through all your financial obligations with you and make sure you have a legal representative.
Private Box provides you with information about the requirements when it comes to getting your company started, but you should always seek appropriate professional advice when it comes to your business dealings.
Don’t be surprised if your accountant or lawyer asks for ID: this practice is about combating money laundering. Your address for service, if you’re registering as an overseas company, might be your accountant or lawyer (or us).
10. Creating a good impression
In addition to having a website and investing in advertising, look at little details such as being included in New Zealand’s Google Maps and being active on social media.
It’s helpful to have a presence in your local NZ community, particularly if the business you run is boutique or family-focused. A focus on professionalism and friendliness also never goes amiss, and word of mouth from happy customers will help your professional reputation grow.
We know that expanding or moving a business enterprise to a new country can be a stressful time, and at Private Box we want to help give you peace of mind.
We can help you set up some key practical aspects of your New Zealand operation – leaving you to focus on getting your business up and running.
Private Box can help you with the registration of your company, take care of details like forwarding your correspondence, and provide you with a virtual office space, as well as putting you in touch with potential resident directors.
Explore our wider website for the different options we offer, or contact us today to discuss your needs.