Section 5: Proposed fees and total charges for all registers

Questions have been included, and your feedback is sought for any or all registers.

Companies

The Companies register is the most comprehensive and searched register administered by the Companies Office. It provides the infrastructure for registered companies and the Registrar of Companies to meet the requirements of the Companies Act. Table 9 on the next page shows the proposed adjustments to current fees paid by companies on the register.

Table 9: Proposed fees and charges for Companies register services

*CO levy $15.00, NZBN levy $12.00, IP levy $1.00

Name approval

This fee was changed from $8.89 to $10.00 in 2017. The proposed fee reflects the general increase in the cost of the service since that time.

Company incorporation

Since 2017, a portion of the cost of the NZBN register has been included in the company incorporation fee. These costs will now be recovered within the proposed NZBN levy (see Section 4: Who would pay the levy and when), removing them from the company incorporation unit cost, resulting in a lower fee.

Annual return

In 2017, the annual return fee was set below cost to significantly reduce the surplus balance in the memorandum account. This fee was reduced at that time because, for the most part, companies had contributed towards this surplus over time due to increasing volumes and a stable cost structure. The NZBN costs previously recovered from the fee have been reapportioned to the NZBN levy, resulting in the proposed fee portion reducing from $21.00 to $9.00 (and from $18.00 to $6.00 for Annual return - API transactions). The proposed total charge for annual returns now reflects full cost recovery with the fee and inclusion of the NZBN and CO levies resulting in a net increase.

Amalgamation

An increase in the proposed amalgamation fee reflects full cost recovery for this service. The nature of the work required to support this service is labour-intensive. While there are only about 370 amalgamation applications per year, it is important that these applications are reviewed thoroughly, requiring significant resource. This service will not attract any levies as they will be charged when the newly formed company pays its annual return fee.

Restoration

The proposed fee is comparatively high because this service requires the Companies Office to consider applications, advertise proposed restorations, and consider any objections that may be received before determining whether a company should be restored. The process across the Companies and Incorporated Societies registers is the same and therefore it is proposed to provide the same fee of $225.00 for both registers.

Fees to be revoked

Over time Companies Office services have moved from paper-based to online. The Companies Act 1993 Regulations 1994 currently prescribe fees for services that are no longer delivered by the Companies Office or are delivered differently compared to when they were introduced. Table 10 below summarises the fees proposed to be revoked from those regulations.

Table 10: Proposed Companies register fees to be revoked

Personal Property Securities

The Personal Property Securities register (PPSR) was established under the Personal Property Securities Act 1999 to provide an efficient system to register security interests in personal property and for this information to be easily searchable. Table 11 below shows the proposed adjustments to current fees paid for services on the PPSR register.

Table 11: Proposed fees for Personal Property Securities register services

Registration and renewal fees (including API)

We propose a decrease in the PPSR registration and renewal fees for single and API transactions. The current fees set in 2017 included a level of IT development cost to replace the register and that work has now been completed. In addition, forecast higher registration and renewal volumes have resulted in a lower unit cost.

Search fee (including API)

Basic internet searches of the PPSR and API searches are charged at different amounts. The unit cost has remained stable with cost increases offset by the increase in volumes. The difference in fees reflects the cost of the search functionality using the API being spread over 3.2 million searches, versus the lower volume of 570,000 public basic searches.

Fees to be revoked

The Personal Property Securities Regulations 2001 currently prescribe fees for services that are no longer delivered by the Companies Office or are delivered differently compared to when they were introduced. Table 12 below summarises the fees proposed to be revoked.

Table 12: Proposed PPSR register fees to be revoked

Disclose

The Disclose register was established by the Financial Markets Conduct Act 2013 (FMC Act) and provides for the registration and ongoing reporting obligations relating to offers of financial products and managed investment schemes. Its functions relate to managed investment schemes, other investment offers and financial statement filing.

All fees are proposed to increase, reflecting planned investment in the Disclose register over the next 2 years to upgrade this register and reduced forecast volumes.

The current fees were set in 2014 and were based on the estimated cost and volumes over a 7-year period, which included one-off volumes of schemes being re-registered. Though the cost of the register has remained relatively stable, current annual volumes have declined which has resulted in an increased unit cost.

The proposed fees are based on the unit cost for each service which has been calculated from the average time it takes staff to complete the various services within the register. The unit costs in Table 13 on the next page are then derived from the cost of service divided by the forecast volumes.

The most significant proposed increase is for the lodgment of Product Disclosure Statements (PDS). This increase is due to the additional time now taken to process the requested updates to existing products on the register and various compliance obligations throughout the year.

Table 13: Proposed fees for Disclose register services

Financial Statement filing

Entities that meet certain criteria under the Companies Act, and under the FMC Act are required to file financial statements with the Companies Office. Table 14 on the next page shows the proposed decrease in the financial statement filing fee.

Table 14: Proposed fee for financial statement filing

Financial Service Providers

The Financial Service Providers (FSP) register was established under the Financial Service Providers (Registration and Dispute Resolution) Act 2008.

Several legislative changes have been introduced to the FSP register since its introduction in 2010. In March 2021 significant changes included the implementation of a new financial advice regime and, before that, introduction of new licensed services, such as non-bank deposit takers and insurers and extending the register to include new financial markets, including registered and licenced services such as peer-to-peer lending and crowd funding. Table 15 below shows the proposed adjustments to current services paid for services on the FSP register.

Table 15: Proposed fees for Financial Service Providers register services

Registration and annual renewal fees

The additional investment in the register over the past 4 years has resulted in an increase in the overall cost of the register. This recent work to enhance the register has had a positive flow-on effect by creating new system approaches to software development that could be utilised by other registers administered by the Companies Office. For this reason, that benefit for all Companies Office registers has meant that the annual return fee for the FSP register can be maintained at the current level of $75.00 and the registration fee can be reduced.

Incorporated Societies

The Incorporated Societies register provides the infrastructure for incorporated societies and the Registrar of Incorporated Societies to meet legislative requirements.

The Incorporated Societies Act 2022 (2022 Act) came fully into force on 5 October 2023 and will co-exist with the Incorporated Societies Act 1908 (1908 Act) until 5 April 2026 when the latter is revoked.

Societies registered under the 1908 Act will not be subject to the new legislation until they reregister under the 2022 Act. If an existing society does not reregister during the transition period from
5 October 2023 to 5 April 2026, it will cease to be incorporated. In August 2023, Cabinet agreed to set registration and restoration fees under the 2022 Act at the same level as those under the 1908 Act:

• Registration fee: $88.89; and
• Restoration fee: $177.78

These fees have now been set in the Incorporated Societies Regulations 2023, which came into force on 5 October 2023, and are intended to cover the period until the new fees and levies are in place.

Fees under the 1908 Act were last updated in 1999. Since then, the overall cost of running the register has increased. This is because electronic functionality of the register has improved, as well as increasing costs related to contact centre support services and services that ensure compliance.

The proposals incorporate education and awareness costs forecasted over the next 4 years related to the introduction of new legislation to ensure existing entities understand their filing obligations under the new 2022 Act (see Section 3: Proposed additional expenditure). Table 16 below outlines the proposed new fees and levies.

Table 16: Proposed fees for Incorporated Societies register services

*CO$15.00, NZBN levy $12.00

Registration fee

It is proposed that the fee for registration is $45.00. This is less than the current fee of $88.89 and reflects the direct costs of registration. The CO and NZBN levies (which would be applied to and annual return registration fees across entity registers) will be applied to this service for a total charge of $72.00.

Restoration fee

It is proposed that the fee for restoration is $225.00. This reflects the level of work undertaken to restore an incorporated society to the register as if it had never been removed. This fee is the same as for company restorations. This service will not attract any levies.

Annual return fee – NEW

Under the 2022 Act, incorporated societies will be required to file an annual return for the first time. An annual return fee of $9.00 is proposed to recover the administrative costs of processing returns. Annual returns were not required to be filed under the 1908 Act, so there is no current fee for this service.

Incorporated societies registered as ‘charities’ with Charities Services under the Charities Act 2005 do not need to file an annual return with the Companies Office and so will not be required to pay this fee. Charities file their annual return with Charities Services and therefore would pay any annual return fees to the Department of Internal Affairs according to the fees that they charge.

In the same transaction as the annual return fee (which recovers the direct cost of that service) incorporated societies will be charged the $12.00 NZBN levy and the $15.00 CO levy, to recover shared system costs, in line with the proposed annual return charges for other entity registers. The proposed total annual return charge is $36.00.

Amalgamation fee – NEW

Section 191 of the 2022 Act provides for 2 or more societies to amalgamate as 1 society. There was no equivalent provision under the 1908 Act.

As this is a new function, we do not know how much time it will take, although we expect it to be simpler than amalgamating 2 companies for which $745.00 is charged. We also do not expect there will be many applications to amalgamate, but if 2 or more societies do wish to do so, this should not be prohibitively expensive for them. Therefore, we propose to set the fee at the same level as the restoration fee for an incorporated society of $225.00.

Conversion fee – NEW

Section 257 of the 2022 Act provides for conversion of a body corporate or other association that is formed or incorporated by or under an Act that is specified by the regulations into an incorporated society. There was no equivalent provision under the 1908 Act.

It is anticipated that the workflow to convert certain entities into an incorporated society is similar to the registration of an incorporated society and therefore the fee is proposed to be set at the same level of $45.00. As this service forms a new incorporated society, a CO levy and NZBN levy is proposed to be charged in addition to the fee.

Limited Partnerships

The Limited Partnerships Act 2008 established a modern regulatory regime for limited partnerships that gives the business community in New Zealand the option of a flexible and internationally recognised business structure, similar to limited partnerships used in overseas jurisdictions. Table 17 on the next page shows the proposed adjustments to the existing limited partnerships registration fee, and the proposed amount for 2 new levies applied to the annual return service.

Table 17: Proposed fee for Limited Partnerships register services

* CO Levy $15, NZBN Levy $12.00

Registration fee

When the current fee was set in 2012 the number of limited partnerships that register was expected to be in the low hundreds. Over time the recognised benefits of registering as a limited partnership under the Limited Partnerships Act 2008 have been recognised, with approximately 380 new registrations annually. This in turn has resulted in approximately 4,600 annual returns now being filed. It is proposed that the cost of processing the annual returns is recovered through the registration fee as the Limited Partnerships Act 2008 does not currently allow a fee to be charged for an annual return service. Accordingly, the charge for registration is proposed to increase from $217.39 to $415.00.

Annual return fee

No annual return fee is proposed. However, limited partnerships will be charged the CO and NZBN levies when they file their annual return. The Limited Partnerships Act 2008 may be reviewed later to include the ability to charge an annual return fee.

Fees to be revoked

The Limited Partnerships Regulations 2008 currently prescribes fees for services that are no longer delivered by the Companies Office or are delivered differently compared to when they were introduced. Table 18 summarises the fee proposed to be revoked in the regulations.

Table 18: Proposed Limited Partnerships register fee to be revoked

Currently, regulation 11 of the Limited Partnerships Regulations 2008 refers to how fees and penalties may be paid. We propose that fees and penalties can no longer be paid by cheque, in line with financial service providers and government departments phasing out cheque payments in 2021.^[4]

Building Societies, Friendly Societies and Credit Unions

The Companies Office maintains a series of small registers for building societies, friendly societies and credit unions to meet the requirements of the Building Societies Act 1965 and the Friendly Societies and Credit Unions Act 1982 (the Act).

Table 19: Proposed fees for Building Societies, Friendly Societies, and Credit Unions register services

*CO levy $15.00, NZBN levy $12.00

Registration and annual return fee

The changing business landscape has resulted in less of these types of entities, meaning fewer registrations and annual returns. This review has highlighted that, as the registered number of these types of entities decline, the entities that remain have to cover costs. The annual return fee portion of the total charge is proposed at $9.00, making this equitable with other entity register annual return fees. It is proposed to align the registration of an association of a credit union with the registration fee for the other registers under the 2 Acts.

Proposed changes specific to Credit Unions and Friendly Societies process fees

Tables 20 and 21 on the next page outline amendments to fees specific to processes for credit unions and friendly societies under the Friendly Societies and Credit Unions Act. These changes are outlined as follows:

For Credit Unions, there are 2 new fees that were enabled under changes to the Act in 2019 (Table 20):

• A new fee for filing a request to remove a credit union under section 140(2)(b) reflects the change to the Act for a dissolution action for credit unions. The existing fee under 82(3) (as applied by section 135(4)) is being revoked. The new fee is based on the cost of dissolution for a friendly society.
• A new fee for filing under section 135C(2) for amalgamations or transfers of the Act.

For Friendly Societies (Table 21) rounding has been applied to a variety of fees other than those in Table 19 to reflect the GST exclusive amount, and then converted back to be GST inclusive for the purpose of inclusion in the new regulations.

No levies are proposed to be added to these services.

Table 20: New Proposed fees for specific Credit Unions register services

Table 21: Proposed fees for specific Friendly Societies register services and rounding

Fees to be revoked

The Friendly Societies and Credit Unions (Fees) Regulations 1992 currently prescribe fees for services that are no longer delivered by the Companies Office. Updates are also required to the description of some fees in the Regulations following a change to the Act in 2019. Table 22 on the next page shows the fees proposed to be revoked or to have their description updated in those regulations.

Table 22: Proposed Friendly Societies and Credit Union register fees to be revoked

Retirement Villages

Retirement villages must register with the Companies Office under the Retirement Villages Act 2003. They must also confirm key information and provide financial statements annually. The current fees were last adjusted in 2011.

The fees for retirement villages are made up of 2 components:

• fees paid by retirement village operators to the Registrar of Retirement Villages (the Registrar) to cover all costs incurred from setting up and maintaining the Retirement Villages register along with all duties and functions required by the Retirement Villages Act 2003; and
• land transfer fees which enable the Registrar to notify the Registrar-General of Land of a retirement village’s registration. The notification is the trigger for the Registrar-General to place a memorial on land titles, providing priority for the rights of residents ahead of the rights of holders of security interests.

Table 23 on the next page shows the proposed adjustments to the 2 components of fee paid by retirement villages. Land transfer fee amounts are not included as they are out of scope of this review, but a change is required to how these are prescribed in regulations.

Table 23: Proposed fees for Retirement Villages register services

*includes the financial statement filing cost of $170.00

Registration and application annual return fees

There is currently a single application fee, and fees for the annual return are set using a tiered system based on the number of units available for occupation by residents (i.e. less than 35 units; 35 to 84 units; or more than 85 units).

The overall cost to manage the register has risen since 2007. However, the cost of delivering these services has shifted from being incurred mainly by processing registration applications, to the processing of key information and reviewing financial statements in the form of an annual return. There are fewer than 12 new registrations per year, but approximately 450 annual returns.

When fees were last set in 2011 the cost for the Companies Office to review annual financial statements was not included. It was incorrectly assumed that these costs would be able to be recovered through the financial reporting statement filing fee under the Companies Act. Therefore, the proposed annual return fee now includes the cost of filing financial statements ($170.00 regardless of the number of units). We propose to increase the annual return fees but reduce the application fee.

We propose that retirement villages continue to pay a tiered annual return fee according to the number of units they have, because it remains more equitable for larger retirement villages to pay a higher fee as they have a larger base by which to recover that cost.

Land transfer fees

It is proposed that sections 4 (b)(c), 6 (a)-(c) and 7 of the Retirement Villages (Fees) Regulations 2006 are amended to refer to fees charged by the Registrar-General of Land, as set out in the Land Transfer Act 2017, and the regulations thereunder

Under the Retirement Villages (Fees) Regulations 2006, registration of Retirement Villages on property titles (regulation 4), notifying the Registrar of any changes to the property, building or premises comprising a retirement village (regulation 6), and any request to cancel the registration of a village (regulation 7) has prescribed fees equivalent to amounts charged by Land Information New Zealand (LINZ) under an outdated version of the Land Transfer Regulations 2018. These fees should align with the fees set routinely by LINZ for comparable transactions, currently set out in Schedule 7, Part 2 of the Land Transfer Regulations 2018.

It is likely that the Land Transfer Regulations 2018 will be reviewed and amended again in the future. To reflect the current fee and avoid a future misalignment of fees between the Retirement Villages (Fees) Regulations 2006 and Land Transfer Regulations 2018, it is proposed that instead of stating a specific fee, the Retirement Villages regulations refer to fees charged by the Registrar-General of Land, as set out in the Land Transfer Act 2017^[5] and the regulations made under the Act.

Method of payment

Currently the Retirement Villages (Fees) Regulations 2006 section 10 refers to how fees and penalties may be paid. We propose that fees and penalties can no longer be paid by cheque, in line with financial service providers and government departments phasing out cheque payments in 2021.^[6]

Insolvency Practitioners

Under the Insolvency Practitioners Regulation Act 2019 the Companies Office is responsible for maintaining a register that captures key information about licensed insolvency practitioners that is provided to accredited bodies. The current fees and levy came into effect on 1 September 2020.

Section 4 proposes no change in the levy amount of $1.00 that is collected from users on the Companies register. Table 24 below shows the proposed adjustments to current fees for insolvency practitioners.

Table 24: Proposed fees for Insolvency Practitioners register services

Registration and annual return fees

The registration fee was first established using the higher volume of practitioners becoming licensed under the Insolvency Practitioners Regulation Act 2019. Now that the scheme has been established the register operating cost is less than forecast, but the annual forecast of new practitioners has also decreased resulting in a proposed increased registration fee. On the other hand, overall, there are more practitioners licensed than forecast, with reduced operating costs related to the annual confirmation process resulting in a proposed decrease in the annual confirmation fee.

Auditors

Under the Auditor Regulation Act 2011 the Companies Office is responsible for maintaining a register that captures key information of licensed auditors received from accredited bodies. The fees have not been adjusted since 2011. The proposed fees in Table 25 on the next page reflect the general increase of the cost of the service since that time.

Table 25: Proposed fees for Auditors register services

Footnotes

[1] Application to register a company under s12(1) and register an overseas company under s336(1) of the Companies Act.

Companies Act 1993(external link) — New Zealand Legislation

[2] Registration of an annual return under s214(1) and overseas company under s340(1) of the Companies Act.

Companies Act 1993(external link) — New Zealand Legislation

[3] Application Processing Interface (API).

[4] For example, the Ministry of Justice stopped processing incoming and outgoing cheques after 31 May 2021.

The Ministry is phasing out payment by cheque(external link) — New Zealand Ministry of Justice

[5] Land Transfer Act 2017(external link) — New Zealand Legislation

[6] The Ministry of Justice stopped processing incoming and outgoing cheques after 31 May 2021.

The Ministry is phasing out payment by cheque(external link) — New Zealand Ministry of Justice

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