Doing business in New Zealand
Before entering the New Zealand business market, there are a number of factors to take into account including culture, politics and business etiquette.
Austrade can help Australian companies familiarise themselves with local market conditions, as well as assist in developing export opportunities through a range of in-market and Australian-based services.
There is extensive information about doing business in New Zealand on this website. Please check the New Zealand profile under 'Country Profiles.'
For further information, go to the following:
Full Text of the Agreement
Related Agreements
While ANZCERTA is the principal agreement supporting the trans-Tasman economic relationship, there are many other agreements and arrangements which complement it:
Trade in Services Protocol
This 1989 Trade in Services Protocol included ‘services’ in the Agreement. Today, almost all trans-Tasman trade in services is open. For further information go to the New Zealand section on the Australian Department of Foreign Affairs and Trade website: www.dfat.gov.au.
Trans-Tasman Mutual Recognition Arrangement (TTMRA)
The TTMRA, a 1998 Arrangement between the Australian and New Zealand Governments and the Governments of the Australian States and Territories, provides that goods (with some exceptions) legally sold in one country may be sold in the other.
In addition, a person who is registered to practice an occupation in either country is entitled to practice an equivalent occupation in the other (with the exception of medical practitioners). In the case of doctors trained in Australia and New Zealand, mutual recognition arrangements apply.
A Users Guide to the Trans-Tasman Mutual Recognition Arrangement is available for download: www.coag.gov.au/mra/mutual_recofnition_users%27_Guide.pdf
Agreed Minute on Industry Assistance
Signed in 1988 and later amplified by correspondence, this Minute provides for consultation between the Australian and New Zealand Governments on changes to industry assistance. For further information go to: www.dfat.gov.au.
The Open Skies Agreement
This Memorandum of Understanding (MOU) was signed in 2000. It allows Australian and New Zealand international airlines to operate across the Tasman – and then beyond to third countries – without restriction.
In addition, international airlines of both countries are able to operate dedicated freight services using what are known as ‘seventh freedom’ rights. For example, a New Zealand dedicated freight carrier can operate services directly from Australia to third countries without operating out of New Zealand.
The Open Skies Agreement also formalized the 1996 Single Aviation Market arrangements which allowed all Australian and New Zealand owned airlines to operate trans-Tasman services and domestic services in either country, subject to the necessary safety approvals. For further information go to: www.infrastructure.gov.au.
Customs Cooperation Arrangement
This 1996 Arrangement provides for cooperation to harmonise customs policies and procedures, assist in the prevention, investigation and repression of offences, and resolve problems of customs administration and enforcement, particularly in the Asia Pacific Region.
For further information go to: www.customs.gov.au.
Protocol on the Harmonisation of Quarantine Procedures
The Harmonisation of Quarantine Procedures Protocol, signed in 1988, provides for work towards common administrative procedures for quarantine. For further information go to: www.aqis.gov.au.
Joint Accreditation System Australia and New Zealand JAS-ANZ
Established in 1991 under the Agreement on Standards, Accreditation and Quality, this joint accreditation body covers the certification of management systems, products and personnel. For further information go to: www.jas-anz.com.au
Arrangement on Food Inspection Measures
Under the Imported Food Control Act 1992, and following a 1996 exchange of letters between Trade Ministers, all food traded between Australia and New Zealand, with the exception of that identified as ‘risk food’, is exempt from import inspection. For further information go to: www.aqis.gov.au
Food Standards Australia New Zealand (formerly ANZFA)
This bi-national statutory authority develops common food standards to cover the whole of the food chain ‘from paddock to plate’. FSANZ operates under the Food Standards Australia and New Zealand Act 1991. The Joint Australia New Zealand Food Standards Code became the sole food standards code in operation in Australia and New Zealand in 2002. For further information go to: www.foodstandards.gov.au.
Memorandum of Understanding (MOU) on Business Law Coordination
This MOU from 2000 provides a framework for work on the alignment of business laws in order to increase the ease of capital flows and trans-Tasman business integration. For further information go to: www.treasury.gov.au.
Trans-Tasman Travel Arrangement
This Arrangement covers a number of Ministerial understandings which allow Australians and New Zealanders to visit, live and work in the other country. For further information go to: www.immigration.gov.au.
Social Security Agreement 2002
This is a cost sharing Arrangement covering aged pensions, disability support pensions and carer payments for partners of disabled persons. For further information go to: www.centrelink.gov.au.
Reciprocal Health Care Agreement
This 1998 Agreement deals with access to health care by Australians and New Zealanders travelling in the other country. For further information go to: www.health.gov.au.
The Double Taxation Agreement
The 1995 Double Taxation Agreement contains provisions for the avoidance of double taxation and the prevention of fiscal evasion in relation to income flowing between Australia and New Zealand.
In February 2003, imputation regimes were extended to include certain companies resident in the other country. This reform addressed the `triangular tax' problem, whereby Australian and New Zealand shareholders who invested through a company resident in the other country, who then went on to earn income and pay taxes in their own jurisdiction, found they were unable to benefit from imputation credits.
Since 2003, Australian shareholders of New Zealand companies have been able to access franking credits arising from the payment of Australian tax by these companies. For further information go to: www.ato.gov.au.
Trade in Goods
ANZCERTA has provided for the elimination of all tariffs and quantitative restrictions for goods meeting ANZCERTA Rules of Origin. Under the Agreement both governments have also sought to harmonise a range of non-tariff measures that affect the free flow of goods and services, including in respect of quarantine and customs issues, standards and business law.
Trade in Services
The ‘1988 CER Trade in Services Protocol’ provides for free trans-Tasman trade in services, with the exception of a number of services which were subject to government regulations when the Protocol was signed and which are inscribed in the Annex to the Protocol. In many cases, inscriptions only exclude certain aspects of a service industry from the operation of Protocol.
The basic provisions of the Protocol are national treatment, market access, rights of commercial presence and most favoured nation treatment. The Protocol operates subject to both countries’ foreign investment policies.
Australia currently has inscribed domestic air services, coastal shipping (cabotage policy), broadcasting and television (limits on foreign ownership), broadcasting and television (short-wave and satellite broadcasting), third party insurance (compulsory third party motor vehicle insurance), and postal services (letters weighing 250 grams or less).
New Zealand currently has inscribed airways services and coastal shipping.
The Governments of Australia, its States and Territories, and New Zealand are parties to the 1997 Australia New Zealand Government Procurement Agreement (ANZGPA). The first ANZGPA was signed in 1991, which superseded the 1986 National Preference Agreement (NPA) under which the governments of Australia agreed to reciprocal non-discriminatory treatment. New Zealand joined the NPA in 1989.
The ANZGPA gives Australian and New Zealand suppliers access to the government procurement market of the other country on an equal value for money footing, ensuring the absence of inter-state and trans-Tasman preference schemes and other forms of discrimination based on place of origin. The arrangement also promotes cooperation and consistency in Australian and New Zealand procurement policy. For further information go to: www.apcc.gov.au.
While the Agreement does not include a specific chapter on investment, nor are there specific provisions on investment in the Services Protocol, ANZCERTA has facilitated cooperation between Australia and New Zealand on the issue of investment.
Australia and New Zealand both operate pre-establishment screening processes for foreign investment in a liberal manner. This has contributed to consistently high levels of trans-Tasman direct investment.
In 1999, the Joint Prime Ministerial Taskforce on Australia New Zealand Bilateral Economic Relations was established to address a number of issues including impediments to trans-Tasman investment. The review resulted in significant liberalisations to the investment regimes of Australia and New Zealand. Ongoing flows of new investment are high and there are no substantive barriers to trans-Tasman foreign direct investment.
The national foreign investment review agencies (for Australia, the Foreign Investment Review Board, and for New Zealand, the Overseas Investment Commission) are well aware of the bilateral importance of trans-Tasman investment and of both governments’ commitment to ensuring that investment review procedures remain at least as liberal as existing practice. In the spirit of CER, Australia and New Zealand have agreed to avoid to the fullest possible extent the imposition of new restrictions on investors and have confirmed that trans-Tasman investment should be subject to minimum constraint.
For further information go to the Australian Foreign Investment Review Board at www.firb.gov.au and the New Zealand Overseas Investment Office at www.oio.linz.govt.nz.
Under ANZCERTA, preferential rates of duty have been set at zero since 1990. The preferential rate is determined by each country’s produce or manufacture in accordance with the Rules of Origin provisions of ANZCERTA, administered through each country's domestic legislation.
Australia businesses considering exporting to New Zealand should find out if the goods or produce for export qualify as originating from Australia, and then acquire necessary supporting documentation in order to obtain the preferential rate.
Details of the duty rates imposed on imports into New Zealand are detailed in ‘The Working Tariff of New Zealand’. Go to: www.customs.govt.nz/library/Working+Tariff+of+New+Zealand/default.htm
This document is a consolidation sourced from two legislative bases: the Tariff Act 1988 (which provides for implementation, at the border, of the Government’s policies on Tariff Industry Assistance), and the Customs & Excise Act 1996, the Third Schedule of which provides for the imposition of an excise tax on certain goods (for example – alcoholic beverages, tobacco, fuel). Such taxes are applied equally to such goods whether they are locally manufactured or imported.
The structure of the Tariff meets New Zealand’s obligations under the international Convention on the Harmonized Commodity Description and Coding System (commonly known as the Harmonised System).
For further information on the rules and requirements of people, goods and craft arriving in New Zealand, go to: www.customs.govt.nz.
ANZCERTA provides for concessional (duty free) access for goods that would normally attract duty but meet the Rules of Origin test which determine that a good has been made in either Australia or New Zealand.
Prior to 1 January 2007, to attain the preferential rate of tariff, exported goods had to qualify under the 50 per cent rule, calculated at the last process in the manufacture.
On 1 January 2007, new Rules of Origin based on a Change of Tariff Classification (CTC) approach, became effective. Under the CTC approach, a product will generally be covered by the CER agreement and gain duty free entry as long as the manufacturing process in Australia or New Zealand involves a specified change in its classification under the global Harmonized Commodity Description and Coding System.
The new approach, which simplifies administration and reduces compliance costs, reflects similar Rules adopted in Australia’s recent Free Trade Agreements with Thailand and the United States.
The new rules provide for a five year transition period during which importers will be able to claim origin under the factory cost rules should they prefer. A review of the revised rules by the two Governments is to be completed within three years of 1 January 2007.
This new approach does not change the rules relating to the treatment of ‘wholly obtained goods’; that is, goods that are obtained or produced entirely in the country, such as minerals extracted there, vegetable goods harvested there, and live animals born and raised there. A small number of products – for example, clothing, auto products and chemicals – include a secondary requirement, such as a regional value content threshold.
The Customs (New Zealand Rules of Origin) Regulations 2006, which contain the new product-specific rules, are available at the Australian Customs web site: www.customs.gov.au/site/page.cfm?u=5339.
Exceptions
As is the case with most international trade agreements, this Agreement allows standard exceptions from its provisions for specified purposes, provided they are not used ‘as a means of arbitrary or unjustified discrimination or as a disguised restriction on trade’.
Some of the specified purposes include:
- protection of essential security interests;
- protection of public morals and prevention of disorder or crime;
- protection of human, animal or plant life or health;
- protection of intellectual or industrial property rights or to prevent unfair, deceptive, or misleading practices; and
- the application of standards or of regulations for the classification, grading or marketing of goods.
Rates of duty for goods not meeting the ANZCERTA Rules of Origin
Details of the duty rates imposed on imports into New Zealand are detailed in ‘The Working Tariff Document of New Zealand’, (see above under ‘Rates of duty for goods not meeting ANZCERTA Rules of Origin’.)
The New Zealand Customs Service website can provide further information on the rules and requirements for people, goods and craft arriving in New Zealand.
In 1988 a joint review deepened ANZCERTA by substantially harmonising quarantine procedures between the two countries in the Protocol on Harmonisation of Quarantine Administrative Procedures. This Protocol sought to improve the speed and efficiency of the flow of goods between the two countries.
Where relevant international codes (such as those of the Office International des Epizooties (OIE)) and standards exist or their completion is imminent, both countries use those codes and standards, or the relevant parts of them, as a basis for quarantine and related inspection standards and procedures, except in special circumstances.
ANZCERTA allows both countries to adopt measures necessary to protect human, animal or plant life or health, including the protection of indigenous or endangered animal or plant life.
Each country may impose quarantine requirements on imports, but such requirements must not be used as a means of arbitrary or unjustified discrimination or a disguised restriction on trade.
In the Protocol, the two countries, among other things, agreed:
- to use relevant international codes and standards where appropriate;
- to work towards arrangements to advance, among other things:
(a) the harmonisation of quarantine standards and procedures; and
(b) the adoption of common inspection standards and procedures;
- where appropriate, to apply any quarantine or related import restrictions on the basis of individual regions, rather than nationwide;
- to develop a consistent approach to pest risk assessment and quarantine requirements for imports from third countries; and,
- to establish a Consultative Group to help resolve outstanding technical differences and provide overall impetus and direction for harmonisation.
- A Quarantine Consultative Group has since been established, and the quarantine relationship between the two countries has developed significantly through regular contact between officials.
Failure to declare goods which have restricted entry into New Zealand could result in the owner of the goods being fined up to $100,000 or a company being fined up to $200,000. Goods that are taken into New Zealand without the required certificates or with incomplete certificates will be destroyed when they reach New Zealand or sent back to the country where they came from.
For further information
The ‘Trans Tasman Mutual Recognition Arrangement TTMRA (1998)’, is one of a number of arrangements and agreements which complement ANZCERTA.
The standards of Australia and New Zealand have been harmonised to the extent that the TTMRA provides that goods that can be legally be sold in either country (with some exceptions) can be sold in the other.
A person who is registered to practise an occupation in either country is entitled to practise an equivalent occupation in the other (with the exception of medical practitioners). In the case of doctors trained in Australia and New Zealand, mutual recognition arrangements apply.
For further information
Department of Innovation, Industry, Science and Research – www.innovation.gov.au
Under the ‘Trans-Tasman Travel Arrangement’, citizens of both countries (who do not have certain criminal convictions) may visit, live and work in the other country indefinitely.
For further information
The Australian Department of Immigration and Citizenship – www.immigration.gov.au
The New Zealand Immigration Service (NZIS) – www.immigration.govt.nz
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