Forestry investor gets formal warning
18 December 2019
Forestry investor gets formal warning for breaking overseas investment rules
The Overseas Investment Office (OIO) has issued a formal warning to forestry investor Roger Dickie for breaking the overseas investment rules.
OIO Group Manager, Vanessa Horne, says Mr Dickie and his companies specialise in finding land for forestry investors to buy.
“In May 2018, Mr Dickie was involved in the sale and purchase of Hadleigh Station in Wairarapa by an overseas investor,” Ms Horne says.
“During the transaction Mr Dickie’s company, Roger Dickie Hadleigh Limited (RDHL), breached the rules by agreeing to acquire a property on behalf of an overseas investor without consent under the Overseas Investment Act.
“In this case, the associate provision of the Act was breached because RDHL entered an agreement to purchase Hadleigh Station on behalf of the overseas investor without prior consent from the OIO.
“After RDHL entered into the agreement, the agreement was transferred into the overseas investor’s name, which was subject to OIO approval.
“The OIO has investigated and found the intention was always for the overseas investor to acquire the property.
“The associate provision is in place to ensure overseas investors don’t side-step the OIO by using intermediaries during transactions.”
The OIO required the overseas investor to apply for retrospective consent to the acquisition and pay a retrospective penalty of $10,000.
“We are satisfied that the overseas investor relied upon Mr Dickie’s advice and the failure to obtain consent on their part was inadvertent,” Ms Horne says.
“Mr Dickie has shown that he has improved his business practices since the sale and purchase of Hadleigh Station.
“We have put Mr Dickie on notice that if he breaks the rules again we will be taking further action.”
Ms Horne says the OIO takes breaches of the Overseas Investment Act very seriously.
Why did the OIO conclude RDHL was acting as an associate for the overseas investor?
The OIO found RDHL was acting as an associate of the overseas investor because correspondence between them discussed the offer and consulted on details, including the price.
Correspondence also showed there was an expectation Mr Dickie was securing the land on the overseas investor’s behalf. In addition, the deposit for the land paid by RDHL was backed by a guarantee from the overseas investor.