The Companies Amendment Act 2014 (formerly part of the Companies and Limited Partnership Amendment Bill) was enacted last week and brings in a number of changes for companies. Most of the changes will not come into force until July 2015 (unless they are brought in earlier by an Order in Council) to allow time for companies and the regulators to prepare for compliance with the new provisions.
The changes address various government policies that have received media attention over the last few years, but have taken a while to make their way into legislation. Three of the more publicised changes relate to:
two additional criminal offences for directors (which have been introduced to fill perceived gaps in New Zealand’s enforcement regime following a series of finance company collapses in the aftermath of the global financial crisis);
new ‘resident director’ requirements for all New Zealand incorporated companies to assist with the prevention of misuse of New Zealand companies by overseas criminal organisations and to meet New Zealand’s obligations as a member of the international Financial Action Task Force; and
amendments to Part 13 and Part 15 of the Companies Act 1993 relating to schemes and amalgamations for companies subject to the Takeovers Code to align the Companies Act provisions more closely with the Takeovers Code regime requirements.
The new criminal offences and the changes to reconstruction provisions in Parts 13 and 15 of the Companies Act came into force last week.
The ‘resident director’ requirements will not take effect until 2 July 2015 (unless the requirement is brought into effect earlier by an Order in Council). At the time the requirement comes into effect, existing companies will have a further 180 days to comply with this requirement.
For more information on the above amendments and details of other changes made by the Companies Amendment Act see our June client update: New rules for companies and limited partnerships in operation soon.
For further details on the new criminal offences see our earlier client update:Criminalisation of directors’ duties – the final outcome.