When expanding your business into New Zealand, you’ll find that many regulations and laws differ to your home country. The New Zealand government has made efforts to simplify market entry for foreign businesses. While you’re busy managing other business operations, you may find it beneficial to use a legal representative for your company.

To ensure you comply with all the relevant legislation and requirements, it’s beneficial to find an in-country expert to act on your behalf. This is especially important for firms that don’t yet have a physical presence in New Zealand. Below, we’ll provide an overview of the benefits of using a legal representative for your business expansion into New Zealand.

What is a legal representative?

Legal representative NZ

A legal representative may be someone within the company, such as an executive director or general manager.

You can think of a legal representative as someone you have appointed to be the ‘legal face’ of your business. This means they can act on behalf of the company. This may be someone within the company, such as an executive director or general manager. However, a legal representative must be over 18, a national of the country, or a foreign national with the right to work and reside in that country. Therefore a company in New Zealand would require a New Zealand national, or foreigner with residency.

When choosing to expand your business operations to New Zealand, you may not have any staff or trusted contacts based there. In this circumstance, you would need to appoint a legal representative outside your company who fits the requirements. Your business may eventually grow and you may establish staff members in your chosen country who can obtain residency and live in your chosen expansion company. In this case, you can assign a legal representative to cover the company formation process and maintenance up until this staff member has been established abroad.

Why is a legal representative necessary?

When you register your business with authorities in New Zealand, you must choose a specific type of business structure. This process can be slightly complex, depending on the business structure chosen and the documentation required.

In New Zealand the 3 types of companies are:

  • Limited Liability Companies
  • Co-Operative Companies
  • Unlimited Companies

Additionally, foreign firms have the option to set up a New Zealand subsidiary or establish a New Zealand based branch for its domestic operations. There are pros and cons of each business structure.

These business structures differ in terms of their functions, and therefore require different documentation. Different structures also have different eligibility requirements. New Zealand’s government advises both nationals and foreigners to consult legal advice before deciding on and registering their company.

Stay compliant with commercial regulations 

Having a legal representative in New Zealand means your company is represented by someone who will act in the best interest of your business. Consulting an expert on what options you have as your business expands means a better chance of success. It also means you will comply with regulations and all the necessary paperwork to register your business.

Your legal representative can take care of the company formation process and sign documents in the country on your behalf. This is greatly beneficial if you’re based abroad saving time and money if legal documents need to be signed.

What can a legal representative do?

Formalized by a notarized document, a legal representative can:

  • Enter into binding contracts on the company’s behalf
  • Execute legal transactions
  • Sell assets
  • Perform all acts regarding the administration of the company that complies with the company purpose.

A legal representative can enter into binding contracts, execute legal transactions, sell assets and perform other tasks on the company’s behalf.

With the notarized document, a company can set limitations to a legal representative’s powers. 

What if I don’t work with a legal representative?

New Zealand holds exciting opportunities for firms looking to expand their operations abroad. It’s one of the best countries in the world to do business in, but it’s also well regulated. This means there’s a lot of paperwork to complete and processes to be followed carefully.

Working with a legal representative isn’t mandatory by law. However, choosing not to appoint a legal representative means you are individually responsible for making sure you’re following due process in the company formation phase. Without guidance from a legal expert, your incorporation process is prone to delays as a result of mistakes or information you might miss. Failing to stay compliant with commercial regulations could also result in financial penalties.

Choosing your legal representative

A legal representative carries great responsibilities for your company. Most importantly, you need to trust your legal representative as they have the power to make big decisions over operations. It’s also important to appoint someone who has a wealth of experience in managing businesses in New Zealand and Australia. When drafting the legal documents to appoint your legal representative, be aware of the extent of the powers granted. You may restrict these powers adequately to minimize risk however they need to cover the functions to perform the necessary legal duties.

Is it important that your chosen legal representative is also aware of their obligations and liabilities. They assume substantial risk themselves should the company fall into financial or legal problems.

A comfort net in the company formation process

Getting the help of a legal eye eases your responsibilities during company formation. New Zealand’s law experts are experienced in assisting individuals and businesses get off the ground, and can give you guidance on the complexities of local law.

Seek a trusted partner

Reduce risk of delays by consulting with professionals that have expertise in New Zealand. At Biz Latin Hub, we offer a range of commercial and legal representation services.

Additionally, we can take on the service of company formation in New Zealand. We offer a range of back-office services including accounting and tax services, due diligence, recruitment services and visa processing.

Reach out to us today at [email protected] to get the ball rolling on your expansion project to New Zealand.