Since 1 May 2015, a New Zealand company must have at least one director who either: “lives in” New Zealand; or lives in Australia and is also the director of an Australian company - excluding a branch (“Residency Requirement”).

Until July 2016, the New Zealand Companies Office’s (“Regulator’s”) sole focus in determining whether a director “lived in” New Zealand was whether he was physically present here for at least 183 days of each relevant year. In Re Carr [2016] NZHC 1470, the High Court agreed that such physical presence would conclusively satisfy the Residency Requirement. However, it also decided that a director failing to meet that requirement could still be found to “live in” New Zealand depending on the manner of how he/she lived in New Zealand and if he/she had strong connections and ties to New Zealand.

Mr Carr’s business interests meant that he had only been physically present here for, on average, 122 days per year - and for just 69 days in 2015. Despite this, the Court ruled that Mr Carr’s did “live in” New Zealand, being influenced by some key factors, including, amongst others, that:
• his partner lives here most of the year;
• he has a home and other land here;
• his primary doctor is here; and
• he presents as a New Zealand business person would.

On 17 August 2016, the Regulator announced that it had changed its approach in line with the case’s findings.

Our team would be happy to help you or your clients with this or any other corporate compliance issue.