Investment and Residence in the Cook Islands

Business opportunities

NON-COOK Islanders seeking permission to reside or do business in the Cook Islands have to take account of three statutes:-

• The Development Investment Act 1995-6.
• The Leases Restrictions Act 1976.
• The Entry Residence and Departure Act 1977.

   The most important is the Development Investment Act which lays down that all foreign organisations or companies that want to set up an enterprise must first obtain approval and register their planned activities.
   The Leases Restrictions Act does not allow freehold ownership of land. Any person/s may lease land for up to five years. Any longer period up to a maximum of 60 years has to be approved by a Committee established under the Act. The Committee's principal function is to regulate leasehold to people other than Cook Islanders and permanent residents.
   The Entry Residence and Departure Act demands that anyone other than Cook Islanders and permanent residents who wish to live and work in the islands must first obtain a work and residence permit.


   Section 17 of the Development Investment Act states:-

"No foreign enterprise shall carry on business in the Cook Islands in any activity unless that foreign enterprise is registered in respect of that activity pursuant to this Act".

'Foreign enterprise' means business with more than one-third foreign ownership. Registration applications must be made to the Cook Islands Development Investment Board. There are various incentives and concessions for tariff protection, import duty and levy concessions, tax concessions by way of accelerated depreciation, allowance for counterpart training and recruitment of Cook Islanders from overseas.
   The Board takes account of an Investment Code which spells out the Government's general investment policy. The Code states:-

"Generally provision should be made in the case of a new foreign investment for the acquisition of equity by or on behalf of Cook Islanders, or for joint ventures with enterprises owned or controlled by Cook Islanders".

The term "Cook Islanders" includes Cook Island Maoris and Permanent Residents. The Development Investment Board Monetary Board may waive these requirements if the investor can demonstrate that attempts were not successful to attract Cook Islanders' participation.
   If the enterprise wishes to lease land to carry on its business and if the land is central to the activity, for instance, hotel/motel accommodation, the Board may require the lease arrangement to provide for the lessors to be paid a share from the activity. This is a brief guide only and a solicitor should be consulted for advice.


Development Investment Act

The Development Investment Act does not allow any foreign enterprise (a business with more than one-third foreign ownership) to carry on business in the Cook Islands in any activity unless it is registered.
     Registration applications must be made to the Cook Islands Development Investment Board. There are various incentives and concessions for tariff protection, import duty and levy concessions, tax concessions by way of accelerated depreciation, allowance for counterpart training and recruitment of Cook Islanders from overseas.
     The board's investment code says that generally provision should be made in the case of a new foreign investment for the acquisition of equity by or on behalf of Cook Islanders, or for joint ventures with enterprises owned or controlled by Cook Islanders.

Foreign investment in the Cook Islands
The Business Trade Investment Board outlines as follows the steps and information required for the successful registration of a foreign enterprise in the Cook Islands.
Foreign Enterprise Registration Checklist
Foreign company:-


• Business plan
• Completed registration application form
• Completed due diligence form
• Two references (from lawyer, accountant, banker)
• Police character reference from home country
• Health report form (includes HIV report; avian flu report if from Asian countries)
• Copy of passport details and photo
• Curriculum Vitae
• NZ$750.00 fee
Joint venture foreign company:-

• Copy of articles of association
• Copy of memorandum of association
• Land involved
• Copy of deed of lease
• Purchase an existing business
• Copy of sale and purchase agreement
Reserved investment areas:-
Some areas of investment are reserved for Cook Islanders only:-
Agriculture

• Commercial agricultural or food production Marine resources
  
• Pearl farming
• Commercial aquaculture or harvesting of pearl shell, shell fish or other reef or lagoon products
• Fresh fish processing
• Fresh fish exporting Manufacturing and production
  
• Food processing including freezing and drying, or drink bottling
• Screen printing of fabrics or other piece goods
• Making of traditional or cultural handicrafts and artefacts (including commercial reproductions)
• Recordings of cultural performances Tourism
  
• Visitor accommodation
• Motor vehicle rentals
• Tourist tours or transfers
• Eco-tourism Other areas
  
• Cinema operations
• Bakeries or pastry shops
• Grocery retail outlets (including sundry stores, superettes, and supermarkets)
• Ownership of galleries for paintings or other visual arts
• Restaurants, cafés, or other food preparation and sale operations
• Retail of traditional or cultural handicrafts and artifacts (including commercial reproductions)
• Sale or supply of computer hardware or related services
• Trucking and cartage operations
• Laundry or drycleaning
• Audio or video production, hire, or sale
  Exceptions
  The following exceptions have been established in cases where foreigners may wish to invest into the Cook Islands economy, specifically in the Reserved Investment Areas:-
  1. The foreign enterprise wishes to acquire an existing business, notwithstanding that it may be listed in Reserved Investment areas, where the owner of the business has made a genuine and demonstrable effort to the satisfaction of the BTIB to sell the business to Cook Islanders, but
  • Has been unable to do so; or
  • Has been able to do so only at a price so far below the price obtainable by selling to the foreign enterprise, that in all the circumstances it would be unreasonable to require the owner of the business to sell to a Cook Islander.
  2. The foreign enterprise wishes to establish a new business in an activity where
  • There is a demonstrable demand for that activity; and
  • No Cook Islander is currently carrying on business in that activity.
  3. Existing Cook Islands enterprises do not have the resources to carry out the specific project (eg specialised construction project) comprising the activity.
  4. The foreign enterprise is a joint venture involving Cook Islanders (the greater the ownership and participation by Cook Islanders, the more likely it is to obtain approval).
  Joint venture
  Local partners seeking foreign assistance, in terms of financial investment, asset-based investment or expertise, may do so but must register with BTIB.
  Registry of business and investment opportunities
  Through this registry, the Business Trade Investment Board aims to link local partners with an international network of buyers, investors and financing sources, and to increase economic growth and employment in the Cook Islands.
  The BTIB is developing a registry of investment opportunities, expansion programmes needing partners and new ideas.
  It can also help with applications for development funding from regional and international agencies like the Marketing Support Fund from the Pacific Forum Secretariat.
  Unit titles
  In the Cook Islands the ownership of a building requires that you either own the freehold title to the land on which the building is situated or you have a lease of that land.
  The Unit Titles Act enables ownership of a defined part of a building (referred to as a 'unit') without the owner having to be the lessee of the land.
  The form of subdivision known as a unit title was created under the Unit Titles Act 1972. Used to create a number of different properties (which may be flats, units or semi-detached dwellings) over an existing parcel of land, it is specially useful in situations where there are upper and lower limits to the property such as in a high-rise development where levels are an intrinsic part of the definition of the title. Unit titles are also useful in smaller single level developments as the boundaries between buildings or dwellings and can be easily defined.

  Solicitors in the Cook Islands include:-

  Browne Gibson Harvey PC, PO Box 123, Rarotonga. Phone: 682 24 567 Fax: 682 21 567 or 682 25 567, Email: law@clarkes.co.ck
  Miller Howard and Lynch, PO Box 39, Panama, Rarotonga. Phone: 682 21 043 Fax: 682 21 143.
  Stevenson Nelson and Mitchell, PO Box 552, Avarua, Rarotonga. Phone: 682 21 080 Fax No: 682 21 087.
  Tim Arnold, PO Box 486, Rarotonga. Phone: 682 23 565 Fax: 682 23 568.
  Tony Manarangi, PO Box 514, Rarotonga. Phone: 682 23 840 Fax No: 682 23 843.

  Accountants in the Cook Islands include:-

  Carolyn Short and Associates, PO Box 632, Rarotonga. Phone: 682 24 530 Fax: 682 24 531
  KPMG Peat Marwick, PO Box 691, Rarotonga. Phone: 682 20 486 Fax: 682 21 486
  Trends Limited, PO Box 1040, Rarotonga. Phone 682 20 537 Fax: 682 24 537
  Wood & Co, PO Box 67, Rarotonga. Phone: 22 371 Fax: 682 20 932

  Banks in the Cook Islands include:-

  ANZ Banking Group Ltd, PO Box 907, Rarotonga. Phone: 682 21 750 Fax: 682 21 760
  Bank of the Cook Islands, PO Box 113, Rarotonga. Phone: 682 29341 Fax: 682 29343 e-mail: cash@bci.co.ck
  Westpac Banking Corporation, PO Box 42, Rarotonga. Phone: 682 22 014 Fax: 682 20 802 e-mail: bank@westpac.co.ck
  

  Real Estate Agents and Property Consultants in the Cook Islands include:-

  Cook Islands Commercial Realty Brokers Ltd, PO Box 779, Rarotonga. Fax: 682 25265. property@realty.co.ck
  Cook Islands Real Estate, PO Box 3159, Rarotonga, Cook Islands. Phone: 682 55289. info@cookislands-realestate.com
  Rarotonga Realty, PO Box 149, Rarotonga. Cook Islands. Fax: 682 26665. john@taakokavillas.co.ck

  The Cook Islands is a neutral tax country for offshore banking. See Offshore industry in the Cook Islands

  Investment opportunities

  It's best to get your financial house in order before you invest in more property. This includes paying off debts like credit cards and vehicles if you can, which will not only improve your credit score but give you extra liquidity should you need it for your new property. Also, if you own timeshare and aren't using it, consider selling. If you don't use your vacation property you are essentially paying your maintenance fee every year with no benefit. It's time to sell timeshare and free up your funds for other pursuits.

  Black Rock Villas offers two self-contained villa accommodation (spacious accomodation for 4 comfortably in each ), plus private residence with plenty of room for future expansion. Located on the sunset side of the island of Rarotonga in the Cook Islands, these villas have magnificent views over the Pacific ocean and are only a stone's throw from the famous Rarotongan landmark of Black Rock. This area is known locally for the ever changing sunsets and spectacular swimming and recreational area. E-mail cafe@oyster.net.ck for more info.

  Hideaway Café + Bar: To be sold jointly. These two businesses are perfectly located at the Cooks corner bus-stop in Avarua, Rarotonga. The café has a brisk breakfast and lunch trade, and the bar is an exceptionally well patronaged night spot. Both businesses come as walk in-walk-out situation - completely turnkey operation including the existing long term staff. E-mail mad-runner@live.com for further details.

  A magnificent one-year old two-storey block home that is as solid as a rock. This two-storey house is located off the backroad on the island of Rarotonga and is set among a tropical garden of fruit trees and exotic plants and flowers. Featured floors and plenty of timber work throughout the house. Second bedroom is loft style, and is able to sleep four comfortably with own private balcony and ensuite. Single car port with extra large laundry area with plenty of storage space It sits on 1000 square metres. E-mail jandp@oyster.co.ck for details

  Time for a lucrative Rarotonga lifestyle change?
  GREAT POTENTIAL PROFITS!
  A lifestyle dream and labour of love has seen the refurnishing, rebuilding, adding and beautifying of the complex which is now a modern, immaculate oasis of four cottages, three apartments and a villa - all ready to go! This immaculate turnkey operation can now be yours. Only NZ$1.3m ono. E-mail and quote "oasis ck " info@cookislands-realestate.com

  Aitutaki Property For Sale or Investment Partnership
  Approximately 1.00 Ha (2.25 acres) of prime, largely undeveloped, lagoon edge property with unsurpassed panoramic views across the 'prettiest lagoon in the world'. Current improvements include: Two storey residence; six accommodation bungalows. Beautiful large restaurant building with feature stone works, mahogany bar tops, large sun deck and incredible lagoon views (a perfect wedding venue); office building-cum-second residence. Tropical gardens with numerous lush mango, coconut and other fruit trees and lots of space still begging to be developed. Ideally situated on a volcanic (not white sand) beach for development as a boutique resort and water sports haven - lagoon cruises, windsurfing, kitesurfing, fishing lodge, upmarket restaurant. Or keep it as your very own private home and getaway. A unique opportunity to enjoy tropical life on the edge of paradise. (55 year leasehold title) Asking price: NZ$1,350,000.00 (+ VAT) o.n.o. Would consider an investment partnership. Please direct enquiries to: Wayne Blake aitlodge@aitutaki.net.ck

Site designed, constructed and maintained by
Jarvy Web
Revised: January 12 2010
URL: http://www.ck/invest.htm