Foreign Development Cooperation in New Zealand
New Zealand is a highly developed country and as such does not receive any development aid. However, like Australia, it is a regionally important provider of aid, especially to the countries of the Asia-Pacific region. According to the “New Zealand Aid Programme” strategic plan, 60% of foreign aid was provided to the Pacific region in the years 2015-2018.
More information on the development assistance provided can be found on the website: www.nzaid.govt.nz.
|The most important beneficiaries of direct aid|
|state||Indicative aid volume for the period 2018/19 + 2019/20 + 2020/21|
|Solomon Islands||NZD 114.48 million|
|Tokelau||NZD 86.70 million|
|Papua New Guinea||NZD 112.64 million|
|cooks Islands||NZD 67.57 million|
|Niue||70.69 million NZD|
|The Independent State of Samoa||NZD 79.77 million|
|Cribbing||91.17 million NZD|
|Tonga||NZD 64.77 million|
|Fiji||NZD 60.71 million|
|Tuvalu||NZD 38.33 million|
|Nauru||NZD 10.47 million|
Market entry: distribution and sales channels, use of local representatives, other factors affecting sales
From the point of view of Czech exporters to the New Zealand market, the most important entity is the importer (distributor) with connections to the main local customers or dealers, who chooses their own sales technique according to local customs for the given type of goods (own dealer network, direct mailing, etc.). The geographical size of New Zealand and the direct business costs of a representative cannot be underestimated, especially the cost of distributing goods.
The largest local importers usually represent important global companies, and choosing a suitable partner for newly introduced products is complex. A Czech company can appoint its own agent or representative or appoint a local registered company as a representative. For the sale of machinery, engineering technologies and components, cooperation with local engineering firms (engineering consultants) can be recommended, as in this respect close cooperation with the investor is necessary based on the solution of specific projects.
Even in New Zealand, the pressure of end users to buy goods directly from the manufacturing plants is intensifying. Supermarket chains with food and consumer goods (Woolworths, etc.) and some department stores have their own import departments and also use their own brands (home brands, private brands) and direct links to production.
A number of Czech exporters use the connection of Australian companies to the New Zealand market and conclude agency contracts with Australian partners for New Zealand as well. Considering the geographical distance between NZ and Australia, consideration should be given to the suitability of this solution and consideration should be given to an agency agreement directly with the New Zealand entity. For accessible contact with New Zealand importers without the need to travel to New Zealand, it is possible to use important European exhibition events, which representatives from New Zealand regularly visit.
Lists of importers/distributors, resellers are available from Chambers of Commerce based in New Zealand’s most important business centres, industry associations, consultancy and marketing firms and market research consultants.
Import conditions and documents, customs system, export control, domestic market protection
A commercial invoice, sea or air bill of lading, packing slips are required upon importation – if the goods are subject to physical inspection and customs declaration. No form of commercial invoice, accompanying clause or other special documents is prescribed for customs purposes.
Customs supervision is carried out by the New Zealand Customs Department. The customs administration has an electronic system for processing customs declarations (New Zealand Customs’ Casper Enhancements System), which was put into operation in the mid-1990s. Over 90% of declarations are processed automatically and in a very short time. More detailed information can be found at: www.customs.govt.nz
The customs system also includes a permit procedure for the import of products that are subject to special health regulations, including links to the Ministry of Agriculture and Fisheries and the Ministry of Health.
The New Zealand customs tariff is based on the CCC (Customs Co-operation Council) harmonized customs tariff and the Brussels nomenclature for customs declarations. Duty and tax are paid automatically and it is possible to use a twenty-day payment deferral. For the correct determination of the declared goods, it is recommended to use the services of a qualified customs agent. Customs rates are often zero, with some goods having rates of 5 or 10%.
New Zealand provides preferential treatment to countries with a Free Trade Agreement.
The export of strategic agricultural products is controlled by marketing organizations NZ Dairy Board, NZ Apple and Pear Marketing Board, NZ Meat Producers Board, NZ Wool Board, NZ Fishing Industry Board, NZ Kiwifruit Board. The main task of these organizations is assistance in the application of important export commodities on foreign markets, creation of a unified marketing strategy, promotion, including the introduction of trade marks on the world market, and quality control of exported goods. The Dairy Board, Apple and Pear Board and Kiwifruit Board maintain a monopoly position and export dairy products, milk, apples, pears and kiwifruit. Others grant permission to export abroad to companies with a guarantee of quality assurance and export techniques. Obtaining a license is a formal matter and is not restrictive in nature.
New Zealand is a small open economy that protects its market especially in the area of sanitary and phytosanitary.
As of October 1, 2018, an amendment to the Customs Declaration and Procedure Act – Customs and Values Act 2018 is in force. As part of the new arrangement, there was:
- modernization of the system (new items for customs clearance, automatic removal of typos and ambiguities, in accordance with the changing business environment),
- the introduction of so-called provisional values - in the event that it is not possible to determine the final value to be cleared, after a previous request or for goods with automatic entitlement to a provisional value, you can apply for customs clearance of a part and subsequent customs clearance of the remaining part,
- new rules on customs value (in the previous adjustment of the tariff classification of goods),
- storing business documents online or abroad, if possible (exceptions for documents kept in NZ or using a third party for safekeeping)
- clarification of the scheme of sanctions and penalties
- amending related legislation
Conditions for setting up an office, representative office, joint venture
The legal forms of companies are determined by the Partnership Act 1908 and the Companies Act 1993. Business activities are regulated by the Fair Trading Act 1986. All companies must be registered in the Registrar of Companies and receive a tax registration number from the Inland Revenue Department, the so-called IRD number.
Several forms of business are used in New Zealand:
- limited liability companies – Limited (Ltd.) – the most prevalent form of business,
- companies with unlimited liability,
- partnership (partnership), or limited partnership,
- businesses of individuals (individual proprietors),
- joint ventures.
Foreign companies can also operate in New Zealand in the form of their own branch registered in the corporate (business) register and with an established authorized person. Every foreign company must submit an annual accounting report under the Companies Act. The accounting report must contain all the company’s activities – i.e. also in the country of origin or other countries.
A special type of activity is a representative – an agent. If a foreign firm appoints an agent whose duties are only to obtain orders, provide sample storage and provide technical assistance to New Zealand customers, this activity is not considered to be carrying on business by a New Zealand entity and the activity of the agent is not subject to local authority control. Considering the above conditions and the volume of deliveries, it is more practical for Czech companies to appoint an agent on a commission basis.
Requirements for promotion, marketing, advertising (use of HSP), important fairs and exhibitions in the territory
We recommend taking advantage, in particular, of participating in specialized exhibitions, ideally repeatedly. We consider participation in large professional trade fairs, both in Australia and New Zealand, to be a suitable form of promotion and contact with distributors when entering the New Zealand market, although the cost of renting an exhibition space is very high. A detailed calendar of trade fairs and conferences is available on the website of the Consulate General in Sydney.
We recommend paying close attention to the formal aspect of all promotional materials, especially the linguistic correctness verified by a native speaker. Great emphasis must be placed on the precision of the processing, the correct use of professional English expressions and the regular updating of published data on the website.
In 2018, the Consulate General in Sydney and the Foreign Office of the PaulTrade Agency in Sydney supported the participation of Czech companies at the Fieldays fair as part of an economic diplomacy project.
Issues of intellectual property protection
New Zealand entities usually require a clause in business contracts that the contract is governed by New Zealand law. The establishment of the International Arbitration at the Chamber of Commerce in Paris as the competent institution to resolve the dispute is considered a compromise solution. A practical out-of-court solution is a settlement through a law firm specializing in commercial law.
In New Zealand, there is no association of commercial arbitrators or arbitration proceedings at chambers of commerce, which apparently results from the high correctness and solidity of business relations. New Zealand business partners are internationally recognized as honest business people who meet their commitments.
Like Australia, New Zealand is among the countries that carefully guard and observe the protection of intellectual property rights. The Intellectual Property Office of New Zealand is responsible for the protection of intellectual property rights in New Zealand. More detailed information on this issue can be found on the following website: www.iponz.govt.nz.