The Government is tightening the rules around the sale of farmland larger than five hectares to foreigners.
Associate Finance Minister David Parker and Minister for Land Information Eugenie Sage announced this morning they will strengthen New Zealand's overseas investment regime by issuing a new Directive Letter to the Overseas Investment Office.
This new directive tightens restrictions on overseas investment in farms.
"The existing directive is too loose," says Mr Parker. "It only applied to very large farms more than 10 times the average farm size.
"In practice this meant restrictions in sales generally applied to sheep and beef farms over 7,146 ha or a dairy farm more than 1,987ha."
"Today's announcement raises the bar for overseas investments in sensitive land by replacing the existing large farm directive, with a new and much broader, rural land directive which applies to all rural land larger than five hectares other than forestry," says Ms Sage.
The new Directive Letter will come into force on 15 December.
All applications which are being assessed by the OIO at, and from, this date will be subject to the new directive letter.
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