There is an established need for an inflow of foreign capital if New Zealand is to meet projected growth rates. The Government recognises this and encourages capital inflows especially where there are allied economic benefits such as the access to specialised know-how or export markets. The Government has promulgated certain Regulations which are administered by the Reserve Bank. Under the Capital Issues (Overseas) Regulations 1965, consent is required before any company incorporated overseas can commence business in New Zealand or before an overseas person can borrow or raise any money in New Zealand. A New Zealand company is deemed to be an overseas person if more than 25% of the voting power is held by non-residents. In terms of current policy, overseas companies are permitted to borrow in New Zealand only a limited amount of working capital and some longer term capital calculated on the ratio that their New Zealand owned equity capital bears to their overseas owned equity capital._x000D_
Wholly owned overseas companies are expected to bring all of their Fixed term capital from overseas.