New Zealand QROPS status under threat

New Zealand’s newly created Financial Markets Authority (FMA) could jeopardise the country's future as a QROPS jurisdiction, Premier Pensions Solutions(PPS) has warned.

The company reports a new provision in the proposed pensions bill decrees local pension schemes may only be open to New Zealand residents. 

If such a proposal were to go ahead, New Zealand's eligibility as a QROPS jurisdiction would come under threat.

Premier Pensions Solutions said the proposals fly in the face of the upcoming  tax-free treatment of New Zealand superannuation funds for non-New Zealand residents. This legislation is currently in its final stages of parliamentary scrutiny before passing into law in the coming weeks. 

“So we could have a highly attractive jurisdiction for long term pension fund investment which attracts many members into superannuation schemes registered as QROPS, whilst on the other hand the draft Financial Markets Conduct Bill will not permit such membership once enacted as it currently stands,” PPS said.

PPS is now calling on legislators to resolve this contradiction, suggesting this might be accomplished through the creation of a specific exemption associated with schemes which are, or become, registered as QROPS.

“We and others will be responding to the draft Bill and making representations to the FMA and to ministers at this and every ongoing stage pressing for change so as to enable New Zealand to continue to benefit from its participation in a multi-billion New Zealand dollar QROPS market,” said director Stephen Ward.