Overseas Investment Law – Forestry Changes Now in Effect

On 6 March 2026, the new regime under the Overseas Investment (National Interest Test and Other Matters) Amendment Act came into effect, including significant changes for investments in the forestry sector.

In addition to the changes relating to the Overseas Investment Act allowing Active Investor Plus (AIP) visa holders to purchase residential land (see our article here for further information), a number of other changes have been made which significantly alter the overseas investment process, specifically in terms of forestry investments.

The previous special forestry test has now been repealed in full. Forestry investments will instead be assessed under a new consolidated national interest test. Under this framework, the Minister of Finance has broad discretion to decline consent if an investment is considered contrary to New Zealand’s national interest.

The new consolidated national interest test applies a three-stage framework to consider whether an overseas investment raises risks for New Zealand, including to national security, public order, and broader policy considerations. The assessment can be quick where no risks are identified and the OIO has advised that it will aim to assess 80% of such applications within 5 working days. However, assessments will be escalated where concerns arise, ultimately allowing the Minister to decline an investment that is contrary to New Zealand’s national interest. The OIO has advised that applicants should expect applications that require additional assessment or Ministerial involvement to be assessed within 55 working days or longer where further information is requested.

However, a new Ministerial Directive Letter (MDL) issued on 6 March 2026 confirms that many of the elements of the special forestry will continue to apply in practice. For consenting existing forestry assets, the MDL directs the OIO to impose conditions that largely mirror the previous special forestry test’s focus on residential non-occupation, ongoing forestry use, and maintaining existing arrangements on the land.

The MDL highlights that these conditions may be waived in limited circumstances, such as where the requirement is addressed elsewhere, where less intensive forestry may be appropriate, or where the investor does not have sufficient ownership or control to ensure compliance. The OIO and MPI have also been directed to develop further forestry specific guidance, including how the new regime will apply to different types of forestry assets.

Conversion of farm land to forestry

Conversions of farm land to forestry remain subject to the existing farm land benefit test. Investors must continue to demonstrate that the economic benefits and New Zealander oversight or participation resulting from the investment represent a substantial benefit to New Zealand. The requirement remains for farmland to be advertised on the open market before an overseas purchaser can enter into a contract to buy the land.

New forestry specific materials available

The OIO has now released updated production forestry standard and special conditions so that investors have a degree of certainty as to what the conditions will be if consent is granted. The new conditions are substantially similar to what has been previously required.

An updated production forestry investment plan has also been published.

These documents can be found on the OIO website.

Want to know more?

Get in touch with our specialist Forestry Team to discuss any of the above further.