Economy Profile 2015 Doing Business 2015
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Doing Business 2015 New Zealand
Economy Profile 2015
New Zealand
Doing Business 2015 New Zealand 2
© 2014 The International Bank for Reconstruction and Development /
The World Bank
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ISBN (paper): 978-1-4648-0351-2
ISBN (electronic): 978-1-4648-0352-9
DOI: 10.1596/978-1-4648-0351-2
ISSN: 1729-2638
Cover design: Corporate Visions, Inc.Doing Business 2015 New Zealand 3 CONTENTS Introduction .................................................................................................................................. 4 The business environment .......................................................................................................... 6 Starting a business ..................................................................................................................... 16 Dealing with construction permits ........................................................................................... 21 Getting electricity ....................................................................................................................... 28 Registering property .................................................................................................................. 34 Getting credit .............................................................................................................................. 39 Protecting minority investors ................................................................................................... 46 Paying taxes ................................................................................................................................ 56 Trading across borders .............................................................................................................. 61 Enforcing contracts .................................................................................................................... 65 Resolving insolvency .................................................................................................................. 72 Labor market regulation ........................................................................................................... 75 Distance to frontier and ease of doing business ranking ...................................................... 82 Resources on the Doing Business website .............................................................................. 85
Doing Business 2015 New Zealand 4
INTRODUCTION
Doing Business sheds light on how easy or difficult it is 1, 2014 (except for the paying taxes indicators, which
for a local entrepreneur to open and run a small to cover the period January–December 2013).
medium-size business when complying with relevant
The Doing Business methodology has limitations. Other
regulations. It measures and tracks changes in
areas important to business—such as an economy’s
regulations affecting 11 areas in the life cycle of a
proximity to large markets, the quality of its
business: starting a business, dealing with construction
infrastructure services (other than those related to
permits, getting electricity, registering property, getting
trading across borders and getting electricity), the
credit, protecting minority investors, paying taxes,
security of property from theft and looting, the
trading across borders, enforcing contracts, resolving
transparency of government procurement,
insolvency and labor market regulation.
macroeconomic conditions or the underlying strength of
In a series of annual reports Doing Business presents institutions—are not directly studied by Doing Business.
quantitative indicators on business regulations and the The indicators refer to a specific type of business,
protection of property rights that can be compared generally a local limited liability company operating in
across 189 economies, from Afghanistan to Zimbabwe, the largest business city. Because standard assumptions
over time. The data set covers 47 economies in Sub- are used in the data collection, comparisons and
Saharan Africa, 32 in Latin America and the Caribbean, 25 benchmarks are valid across economies. The data not
in East Asia and the Pacific, 26 in Eastern Europe and only highlight the extent of obstacles to doing business;
Central Asia, 20 in the Middle East and North Africa and they also help identify the source of those obstacles,
8 in South Asia, as well as 31 OECD high-income supporting policy makers in designing regulatory reform.
economies. The indicators are used to analyze economic
More information is available in the full report. Doing
outcomes and identify what reforms have worked, where
Business 2015 presents the indicators, analyzes their
and why.
relationship with economic outcomes and presents
This economy profile presents the Doing Business business regulatory reforms. The data, along with
indicators for New Zealand. To allow useful comparison, information on ordering Doing Business 2015, are
it also provides data for other selected economies available on the Doing Business website at
(comparator economies) for each indicator. The data in http://www.doingbusiness.org.
this report are current as of JuneDoing Business 2015 New Zealand 5
CHANGES IN DOING BUSINESS 2015
As part of a 2-year update in methodology, Doing Finally, the name of the employing workers indicator set
Business 2015 incorporates 7 important changes. First, has been changed to labor market regulation, and the
the ease of doing business ranking as well as all topic- scope of this indicator set has also been changed. The
level rankings are now computed on the basis of indicators now focus on labor market regulation
distance to frontier scores (see the chapter on the applying to the retail sector rather than the
distance to frontier and ease of doing business ranking). manufacturing sector, and their coverage has been
Second, for the 11 economies with a population of more expanded to include regulations on labor disputes and
than 100 million, data for a second city have been added on benefits provided to workers. The labor market
to the data set and the ranking calculation. These regulation indicators continue to be excluded from the
economies are Bangladesh, Brazil, China, India, aggregate distance to frontier score and ranking on the
Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian ease of doing business.
Federation and the United States. Third, for getting
Beyond these changes there are 3 other updates in
credit, the methodology has been revised for both the
methodology. For paying taxes, the financial statement
strength of legal rights index and the depth of credit
variables have been updated to be proportional to 2012
information index. The number of points has been
income per capita; previously they were proportional to
increased in both indices, from 10 to 12 for the strength
2005 income per capita. For enforcing contracts, the
of legal rights index and from 6 to 8 for the depth of
value of the claim is now set at twice the income per
credit information index. In addition, only credit bureaus
capita or $5,000, whichever is greater. For dealing with
and registries that cover at least 5% of the adult
construction permits, the cost of construction is now set
population can receive a score on the depth of credit
at 50 times income per capita (before, the cost was
information index.
assessed by the Doing Business respondents). In addition,
Fourth, the name of the protecting investors indicator set this indicator set no longer includes the procedures for
has been changed to protecting minority investors to obtaining a landline telephone connection.
better reflect its scope—and the scope of the indicator
For more details on the changes, see the “What is
set has been expanded to include shareholders’ rights in
changing in Doing Business?” chapter starting on page
corporate governance beyond related-party transactions.
24 of the Doing Business 2015 report. For more details
Fifth, the resolving insolvency indicator set has been
on the data and methodology, please see the “Data
expanded to include an index measuring the strength of
Notes” chapter starting on page 114 of the Doing
the legal framework for insolvency. Sixth, the calculation
Business 2015 report. For more details on the distance to
of the distance to frontier score for paying taxes has
frontier metric, please see the “Distance to frontier and
been changed. The total tax rate component now enters
ease of doing business ranking” chapter in this profile.
the score in a nonlinear fashion, in an approach different
from that used for all other indicators (see the chapter
on the distance to frontier and ease of doing business
ranking).Doing Business 2015 New Zealand 6
THE BUSINESS ENVIRONMENT
For policy makers trying to improve their economy’s
regulatory environment for business, a good place to start ECONOMY OVERVIEW
is to find out how it compares with the regulatory
environment in other economies. Doing Business provides
an aggregate ranking on the ease of doing business
Region: OECD high income
based on indicator sets that measure and benchmark
regulations applying to domestic small to medium-size Income category: High income
businesses through their life cycle. Economies are ranked
from 1 to 189 by the ease of doing business ranking. This Population: 4,470,800
year's report presents results for 2 aggregate measures:
the distance to frontier score and the ease of doing GNI per capita (US$): 40,481
business ranking. The ranking of economies is determined
by sorting the aggregate distance to frontier (DTF) scores. DB2015 rank: 2
The distance to frontier score benchmarks economies
with respect to regulatory practice, showing the absolute DB2014 rank: 2*
distance to the best performance in each Doing Business
Change in rank: 0
indicator. An economy’s distance to frontier score is
indicated on a scale from 0 to 100, where 0 represents the
DB 2015 DTF: 86.91
worst performance and 100 the frontier. (See the chapter
on the distance to frontier and ease of doing business). DB 2014 DTF: 86.37
The 10 topics included in the ranking in Doing Business
2015: starting a business, dealing with construction Change in DTF: 0.54
permits, getting electricity, registering property, getting
credit, protecting minority investors, paying taxes, trading * DB2014 ranking shown is not last year’s published
across borders, enforcing contracts and resolving ranking but a comparable ranking for DB2014 that
insolvency. The labor market regulation indicators captures the effects of such factors as data
(formerly employing workers) are not included in this corrections and the changes in methodology. See
year’s aggregate ease of doing business ranking, but the the data notes starting on page 114 of the Doing
data are presented in this year’s economy profile. Business 2015 report for sources and definitions.
The aggregate ranking on the ease of doing business
benchmarks each economy’s performance on the
indicators against that of all other economies in the Doing
Business sample (figure 1.1). While this ranking tells much
about the business environment in an economy, it does
not tell the whole story. The ranking on the ease of doing
business, and the underlying indicators, do not measure all
aspects of the business environment that matter to firms
and investors or that affect the competitiveness of the
economy. Still, a high ranking does mean that the
government has created a regulatory environment
conducive to operating a business.Doing Business 2015 New Zealand
THE BUSINESS ENVIRONMENT
Figure 1.1 Where economies stand in the global ranking on the ease of doing business
Source: Doing Business database.Doing Business 2015 New Zealand THE BUSINESS ENVIRONMENT For policy makers, knowing where their economy regional average (figure 1.2). The economy’s rankings stands in the aggregate ranking on the ease of doing (figure 1.3) and distance to frontier scores (figure 1.4) business is useful. Also useful is to know how it ranks on the topics included in the ease of doing business relative to comparator economies and relative to the ranking provide another perspective. Figure 1.2 How New Zealand and comparator economies rank on the ease of doing business Note: The rankings are benchmarked to June 2014 and based on the average of each economy’s distance to frontier (DTF) scores for the 10 topics included in this year’s aggregate ranking. The distance to frontier score benchmarks economies with respect to regulatory practice, showing the absolute distance to the best performance in each Doing Business indicator. An economy’s distance to frontier score is indicated on a scale from 0 to 100, where 0 represents the worst performance and 100 the frontier. For the economies for which the data cover 2 cities, scores are a population-weighted average for the 2 cities. Source: Doing Business database.
Doing Business 2015 New Zealand 9 THE BUSINESS ENVIRONMENT Figure 1.3 Rankings on Doing Business topics - New Zealand (Scale: Rank 189 center, Rank 1 outer edge) Figure 1.4 Distance to frontier scores on Doing Business topics - New Zealand (Scale: Score 0 center, Score 100 outer edge) Note: The rankings are benchmarked to June 2014 and based on the average of each economy’s distance to frontier (DTF) scores for the 10 topics included in this year’s aggregate ranking. The distance to frontier score benchmarks economies with respect to regulatory practice, showing the absolute distance to the best performance in each Doing Business indicator. An economy’s distance to frontier score is indicated on a scale from 0 to 100, where 0 represents the worst performance and 100 the frontier. For the economies for which the data cover 2 cities, scores are a population-weighted average for the 2 cities. Source: Doing Business database.
Doing Business 2015 New Zealand 10
THE BUSINESS ENVIRONMENT
Just as the overall ranking on the ease of doing business tells Doing Business introduced the distance to frontier score. This
only part of the story, so do changes in that ranking. Yearly measure shows how far on average an economy is from the
movements in rankings can provide some indication of best performance achieved by any economy on each Doing
changes in an economy’s regulatory environment for firms, Business indicator.
but they are always relative.
Comparing the measure for an economy at 2 points in time
Moreover, year-to-year changes in the overall rankings do allows users to assess how much the economy’s regulatory
not reflect how the business regulatory environment in an environment as measured by Doing Business has changed
economy has changed over time—or how it has changed in over time—how far it has moved toward (or away from) the
different areas. To aid in assessing such changes, most efficient practices and strongest regulations in areas
covered by Doing Business (figure 1.5).
Figure 1.5 How far has New Zealand come in the areas measured by Doing Business?
Note: The distance to frontier score shows how far on average an economy is from the best performance achieved by any economy on
each Doing Business indicator since 2010, except for getting credit, paying taxes, protecting minority investors and resolving insolvency
which had methodology changes in 2014 and thus are only comparable to 2013. The measure is normalized to range between 0 and 100,
with 100 representing the best performance (the frontier). See the data notes starting on page 114 of the Doing Business 2015 report for
more details on the distance to frontier score.
Source: Doing Business database.Doing Business 2015 New Zealand 11
THE BUSINESS ENVIRONMENT
The absolute values of the indicators tell another part of regulation—such as a regulatory process that can be
the story (table 1.1). The indicators, on their own or in completed with a small number of procedures in a few
comparison with the indicators of a good practice days and at a low cost. Comparison of the economy’s
economy or those of comparator economies in the indicators today with those in the previous year may
region, may reveal bottlenecks reflected in large numbers show where substantial bottlenecks persist—and where
of procedures, long delays or high costs. Or they may they are diminishing.
reveal unexpected strengths in an area of business
Table 1.1 Summary of Doing Business indicators for New Zealand
United Kingdom DB2015
Best performer globally
New Zealand DB2015
New Zealand DB2014
Singapore DB2015
Germany DB2015
Australia DB2015
Canada DB2015
Ireland DB2015
Indicator
DB2015
Starting a Business
1 1 7 2 114 19 6 45 New Zealand (1)
(rank)
Starting a Business (DTF
99.96 99.96 96.47 98.82 81.38 94.17 96.48 91.23 New Zealand (99.96)
Score)
Procedures (number) 1.0 1.0 3.0 1.0 9.0 4.0 3.0 6.0 New Zealand (1.0)*
Time (days) 0.5 0.5 2.5 5.0 14.5 6.0 2.5 6.0 New Zealand (0.5)
Cost (% of income per
0.3 0.3 0.7 0.4 8.8 0.3 0.6 0.3 Slovenia (0.0)
capita)
Paid-in min. capital (%
0.0 0.0 0.0 0.0 35.8 0.0 0.0 0.0 112 Economies (0.0)*
of income per capita)
Dealing with
Hong Kong SAR,
Construction Permits 13 14 19 118 8 128 2 17
China (1)
(rank)
Dealing with
Hong Kong SAR,
Construction Permits 85.67 85.63 84.30 67.12 87.42 65.61 92.84 85.06
China (95.53)
(DTF Score)Doing Business 2015 New Zealand 12
United Kingdom DB2015
Best performer globally
New Zealand DB2015
New Zealand DB2014
Singapore DB2015
Germany DB2015
Australia DB2015
Canada DB2015
Ireland DB2015
Indicator
DB2015
Hong Kong SAR,
Procedures (number) 10.0 10.0 10.0 12.0 8.0 10.0 10.0 9.0
China (5.0)
Time (days) 93.0 93.0 112.0 249.0 96.0 150.0 26.0 105.0 Singapore (26.0)
Cost (% of warehouse
0.7 0.8 0.5 1.3 1.1 9.5 0.3 1.2 Qatar (0.0)*
value)
Getting Electricity
48 44 55 150 3 67 11 70 Korea, Rep. (1)
(rank)
Getting Electricity (DTF
81.90 81.88 80.59 59.27 98.37 78.84 92.45 78.42 Korea, Rep. (99.83)
Score)
Procedures (number) 5.0 5.0 5.0 7.0 3.0 5.0 4.0 4.0 12 Economies (3.0)*
Time (days) 64.0 64.0 75.0 142.0 28.0 85.0 31.0 126.0 Korea, Rep. (18.0)*
Cost (% of income per
78.7 84.3 8.6 131.0 44.4 83.3 26.3 90.1 Japan (0.0)
capita)
Registering Property
2 2 53 55 89 50 24 68 Georgia (1)
(rank)
Registering Property
97.05 97.04 76.87 76.20 67.78 78.34 84.78 72.55 Georgia (99.88)
(DTF Score)
Procedures (number) 2.0 2.0 5.0 6.0 5.0 5.0 4.0 6.0 4 Economies (1.0)*
Time (days) 1.0 1.0 4.5 16.5 40.0 31.5 4.5 21.5 3 Economies (1.0)*
Cost (% of property
0.1 0.1 5.2 3.3 6.7 2.6 2.8 4.6 4 Economies (0.0)*
value)
Getting Credit (rank) 1 1 4 7 23 23 17 17 New Zealand (1)
Getting Credit (DTF
100.00 95.00 90.00 85.00 70.00 70.00 75.00 75.00 New Zealand (100)
Score)
Strength of legal rights
12 12 11 9 6 7 8 7 3 Economies (12)*
index (0-12)Doing Business 2015 New Zealand 13
United Kingdom DB2015
Best performer globally
New Zealand DB2015
New Zealand DB2014
Singapore DB2015
Germany DB2015
Australia DB2015
Canada DB2015
Ireland DB2015
Indicator
DB2015
Depth of credit
8 7 7 8 8 7 7 8 23 Economies (8)*
information index (0-8)
Credit registry coverage
0.0 0.0 0.0 0.0 1.3 0.0 0.0 0.0 Portugal (100.0)
(% of adults)
Credit bureau coverage
100.0 100.0 100.0 100.0 100.0 100.0 50.8 100.0 23 Economies (100.0)*
(% of adults)
Protecting Minority
1 1 71 7 51 6 3 4 New Zealand (1)
Investors (rank)
Protecting Minority
81.67 81.67 56.67 72.50 59.17 73.33 80.00 78.33 New Zealand (81.67)
Investors (DTF Score)
Extent of conflict of
interest regulation 9.3 9.3 6.0 8.7 5.0 8.3 9.3 8.3 Singapore (9.3)*
index (0-10)
Extent of shareholder
governance index (0- 7.0 7.0 5.3 5.8 6.8 6.3 6.7 7.3 France (7.8)*
10)
Strength of minority
investor protection 8.2 8.2 5.7 7.3 5.9 7.3 8.0 7.8 New Zealand (8.2)
index (0-10)
United Arab Emirates
Paying Taxes (rank) 22 21 39 9 68 6 5 16
(1)*
Paying Taxes (DTF United Arab Emirates
88.04 88.02 82.48 93.00 77.02 95.07 97.19 90.52
Score) (99.44)*
Payments (number per Hong Kong SAR,
8.0 8.0 11.0 8.0 9.0 9.0 5.0 8.0
year) China (3.0)*
Time (hours per year) 152.0 152.0 105.0 131.0 218.0 80.0 82.0 110.0 Luxembourg (55.0)
Trading Across Borders
27 27 49 23 18 5 1 15 Singapore (1)
(rank)
Trading Across Borders 85.41 85.25 80.53 86.07 87.67 93.01 96.47 88.32 Singapore (96.47)Doing Business 2015 New Zealand 14
United Kingdom DB2015
Best performer globally
New Zealand DB2015
New Zealand DB2014
Singapore DB2015
Germany DB2015
Australia DB2015
Canada DB2015
Ireland DB2015
Indicator
DB2015
(DTF Score)
Documents to export
4 4 5 3 4 2 3 4 Ireland (2)*
(number)
Time to export (days) 10.0 10.0 9.0 8.0 9.0 8.0 6.0 8.0 5 Economies (6.0)*
Cost to export (US$ per
870.0 870.0 1,200.0 1,680.0 1,015.0 1,160.0 460.0 1,005.0 Timor-Leste (410.0)
container)
Cost to export (deflated
870.0 895.6 1,200.0 1,680.0 1,015.0 1,160.0 460.0 1,005.0
US$ per container)
Documents to import
6 6 7 3 4 2 3 4 Ireland (2)*
(number)
Time to import (days) 9.0 9.0 8.0 10.0 7.0 9.0 4.0 6.0 Singapore (4.0)
Cost to import (US$ per
825.0 825.0 1,220.0 1,680.0 1,050.0 1,121.0 440.0 1,050.0 Singapore (440.0)
container)
Cost to import (deflated
825.0 849.2 1,220.0 1,680.0 1,050.0 1,121.0 440.0 1,050.0
US$ per container)
Enforcing Contracts
9 9 12 65 13 18 1 36 Singapore (1)
(rank)
Enforcing Contracts
77.84 77.84 77.06 63.76 76.74 75.47 89.54 68.08 Singapore (89.54)
(DTF Score)
Time (days) 216.0 216.0 395.0 570.0 394.0 650.0 150.0 437.0 Singapore (150.0)
Cost (% of claim) 27.2 27.2 21.8 22.3 14.4 26.9 25.8 39.9 Iceland (9.0)
Procedures (number) 30.0 30.0 28.0 36.0 31.0 21.0 21.0 29.0 Singapore (21.0)*
Resolving Insolvency
28 26 14 6 3 21 19 13 Finland (1)
(rank)
Resolving Insolvency
71.56 71.40 81.60 89.17 91.78 76.90 77.94 82.04 Finland (93.85)
(DTF Score)Doing Business 2015 New Zealand 15
United Kingdom DB2015
Best performer globally
New Zealand DB2015
New Zealand DB2014
Singapore DB2015
Germany DB2015
Australia DB2015
Canada DB2015
Ireland DB2015
Indicator
DB2015
Time (years) 1.3 1.3 1.0 0.8 1.2 0.4 0.8 1.0 Ireland (0.4)
Cost (% of estate) 3.5 3.5 8.0 7.0 8.0 9.0 3.0 6.0 Norway (1.0)
Outcome (0 as
piecemeal sale and 1 as 1 1 1 1 1 1 1 1
going concern)
Recovery rate (cents on
83.6 83.3 81.9 87.3 83.4 87.7 89.7 88.6 Japan (92.9)
the dollar)
Strength of insolvency
8.5 8.5 12.0 13.5 15.0 9.5 9.5 11.0 5 Economies (15.0)*
framework index (0-16)
Note: DB2014 rankings shown are not last year’s published rankings but comparable rankings for DB2014 that capture the effects of such
factors as data corrections and changes to the methodology. Trading across borders deflated and non-deflated values are identical in
DB2015 because it is defined as the base year for the deflator. The best performer on time for paying taxes is defined as the lowest time
recorded among all economies in the DB2015 sample that levy the 3 major taxes: profit tax, labor taxes and mandatory contributions, and
VAT or sales tax. If an economy has no laws or regulations covering a specific area—for example, insolvency—it receives a “no practice”
mark. Similarly, an economy receives a “no practice” or “not possible” mark if regulation exists but is never used in practice or if a
competing regulation prohibits such practice. Either way, a “no practice” mark puts the economy at the bottom of the ranking on the
relevant indicator.
* Two or more economies share the top ranking on this indicator. A number shown in place of an economy’s name indicates the number
of economies that share the top ranking on the indicator. For a list of these economies, see the Doing Business website
(http://www.doingbusiness.org).
Source: Doing Business database.Doing Business 2015 New Zealand 16
STARTING A BUSINESS
Formal registration of companies has many WHAT THE STARTING A BUSINESS
immediate benefits for the companies and for
business owners and employees. Legal entities can INDICATORS MEASURE
outlive their founders. Resources are pooled as
several shareholders join forces to start a company. Procedures to legally start and operate a
Formally registered companies have access to company (number)
services and institutions from courts to banks as well
Preregistration (for example, name
as to new markets. And their employees can benefit
verification or reservation, notarization)
from protections provided by the law. An additional
benefit comes with limited liability companies. These Registration in the economy’s largest
limit the financial liability of company owners to their business city1
investments, so personal assets of the owners are not
Postregistration (for example, social security
put at risk. Where governments make registration
registration, company seal)
easy, more entrepreneurs start businesses in the
formal sector, creating more good jobs and Time required to complete each procedure
generating more revenue for the government. (calendar days)
What do the indicators cover? Does not include time spent gathering
information
Doing Business measures the ease of starting a
business in an economy by recording all procedures Each procedure starts on a separate day (2
officially required or commonly done in practice by procedures cannot start on the same day).
an entrepreneur to start up and formally operate an Procedures that can be fully completed
industrial or commercial business—as well as the online are recorded as ½ day.
time and cost required to complete these procedures. Procedure completed once final document is
It also records the paid-in minimum capital that received
companies must deposit before registration (or
within 3 months). The ranking of economies on the No prior contact with officials
ease of starting a business is determined by sorting Cost required to complete each procedure
their distance to frontier scores for starting a (% of income per capita)
business. These scores are the simple average of the
distance to frontier scores for each of the component Official costs only, no bribes
indicators. No professional fees unless services required
To make the data comparable across economies, by law
Doing Business uses several assumptions about the Paid-in minimum capital (% of income
business and the procedures. It assumes that all per capita)
information is readily available to the entrepreneur
and that there has been no prior contact with Deposited in a bank or with a notary before
officials. It also assumes that the entrepreneur will registration (or within 3 months)
pay no bribes. And it assumes that the business:
Is a limited liability company, located in the Has a start-up capital of 10 times income per
largest business city and is 100% domestically capita.
owned1.
Has a turnover of at least 100 times income per
Has between 10 and 50 employees. capita.
Conducts general commercial or industrial Does not qualify for any special benefits.
activities.
Does not own real estate.
1
For the 11 economies with a population of more than 100 million, data for a second city have been added.Doing Business 2015 New Zealand 17 STARTING A BUSINESS Where does the economy stand today? What does it take to start a business in New Zealand? largest business city of an economy, except for 11 According to data collected by Doing Business, starting a economies for which the data are a population-weighted business there requires 1.0 procedures, takes 0.5 days, average of the 2 largest business cities. See the chapter costs 0.3% of income per capita and requires paid-in on distance to frontier and ease of doing business minimum capital of 0.0% of income per capita (figure ranking at the end of this profile for more details. 2.1). Most indicator sets refer to a case scenario in the Figure 2.1 What it takes to start a business in New Zealand Paid-in minimum capital (% of income per capita): 0.0 Note: Time shown in the figure above may not reflect simultaneity of procedures. Online procedures account for 0.5 days in the total time calculation. For more information on the methodology of the starting a business indicators, see the Doing Business website (http://www.doingbusiness.org). For details on the procedures reflected here, see the summary at the end of this chapter. Source: Doing Business database.
Doing Business 2015 New Zealand 18 STARTING A BUSINESS Globally, New Zealand stands at 1 in the ranking of 189 average ranking provide other useful information for economies on the ease of starting a business (figure 2.2). assessing how easy it is for an entrepreneur in New The rankings for comparator economies and the regional Zealand to start a business. Figure 2.2 How New Zealand and comparator economies rank on the ease of starting a business Source: Doing Business database.
Doing Business 2015 New Zealand 19
STARTING A BUSINESS
What are the details?
Underlying the indicators shown in this chapter for
STANDARDIZED COMPANY
New Zealand is a set of specific procedures—the
bureaucratic and legal steps that an entrepreneur
must complete to incorporate and register a new Legal form: Limited Liability Company
firm. These are identified by Doing Business through
collaboration with relevant local professionals and Paid in minimum capital requirement: NZD 0
the study of laws, regulations and publicly available City: Auckland
information on business entry in that economy.
Following is a detailed summary of those procedures, Start-up Capital: 10 times GNI per capita
along with the associated time and cost. These
procedures are those that apply to a company
matching the standard assumptions (the
“standardized company”) used by Doing Business in
collecting the data (see the section in this chapter on
what the indicators measure).
Table 2.2 Summary of time, cost and procedures for starting a business in New Zealand
Time to
No. Procedure Cost to complete
complete
Apply online for registration with the Companies Office (including
IRD number application and registration for GST)
To reserve a company name online, entrepreneurs can visit the New
Zealand Companies Office Web site (www.business.govt.nz/companies).
A new company’s name must be unique and can be reserved for up to
20 working days with the Companies Office. The applicant(s) can then
apply for company registration online by completing forms on
company details (such as names of shareholders and directors and
company addresses and address of communication) and paying the
registration fee using a credit card or an account set up with the
Companies Office. When the application is processed, the founder(s)
will receive a notification by email along with the appropriate director NZD 10.22 name
and shareholder consent forms, which are generated by the Companies Less than one day reservation + NZD
1
Office. The applicant must then fax the signed director and shareholder (online procedure) 150 company
consent forms within 20 working days, after which the application will incorporation
expire. The certificate of incorporation will be issued via email in a few
minutes when the last consent form is accepted.
To be incorporated under the Companies Act 1993, a company must
have a name reserved by the Registrar of Companies, at least one share,
at least one shareholder, at least one director, a registered office, and
an address for service.
Promoters can apply online for a company IRD (Inland Revenue
Department) number and register for the GST (Good and Service Tax) at
the same time as incorporating a company online with the New Zealand
Companies Office.
The list of the information needed when applying for a company IRDDoing Business 2015 New Zealand 20
Time to
No. Procedure Cost to complete
complete
number or registering for GST is as follows:
• IRD number – IRD number of each Director and all individual
shareholders that are NZ residents, Main Business Activity, Place of
Business and Postal Address, Trading Name of the company (if different
from the Business Name), Company Contact details, a Business Industry
Description and Code, and whether or not the Fringe Benefit Tax for
employees is applicable.
• GST number – GST accounting method, frequency of filing returns,
business activity code, details of how you would like refunds to be paid,
whether or not the company will be making tax exempt supplies,
Business Industry Description and Code, and whether or not the
company will be making imports/exports and ACC uses the business
activity code to calculate levies for personal injury cover and residual
claims (see www.businessdescription.co.nz for more information).
Since 1 July 2008, it has been mandatory to file most documents with
the Companies Office online. The introduction of this policy has seen
the removal of many of the paper based processes that the Companies
Office previously supported.
Since 2013, all newly established companies on the Companies Register
are assigned a New Zealand Business Number (NZBN) upon
incorporation. The introduction of NZBNs is the first step toward
creating a single searchable public register of businesses.
Agency: New Zealand Companies Office
* Takes place simultaneously with another procedure.
Note: Online procedures account for 0.5 days in the total time calculation.
Source: Doing Business database.Doing Business 2015 New Zealand 21
DEALING WITH CONSTRUCTION PERMITS
Regulation of construction is critical to protect the WHAT THE DEALING WITH CONSTRUCTION
public. But it needs to be efficient, to avoid excessive
PERMITS INDICATORS MEASURE
constraints on a sector that plays an important part in
every economy. Where complying with building
regulations is excessively costly in time and money, Procedures to legally build a warehouse
many builders opt out. They may pay bribes to pass (number)
inspections or simply build illegally, leading to Submitting all relevant documents and
hazardous construction that puts public safety at risk. obtaining all necessary clearances, licenses,
Where compliance is simple, straightforward and permits and certificates
inexpensive, everyone is better off. Submitting all required notifications and
What do the indicators cover? receiving all necessary inspections
Doing Business records the procedures, time and cost Obtaining utility connections for water and
for a business in the construction industry to obtain sewerage
all the necessary approvals to build a warehouse in Registering the warehouse after its
the economy’s largest business city, connect it to completion (if required for use as collateral or
basic utilities and register the warehouse so that it for transfer of the warehouse)
can be used as collateral or transferred to another Time required to complete each procedure
entity. (calendar days)
The ranking of economies on the ease of dealing with Does not include time spent gathering
construction permits is determined by sorting their information
distance to frontier scores for dealing with
Each procedure starts on a separate day.
construction permits. These scores are the simple
Procedures that can be fully completed online
average of the distance to frontier scores for each of
are recorded as ½ day.
the component indicators.
Procedure considered completed once final
To make the data comparable across economies, document is received
Doing Business uses several assumptions about the
business and the warehouse, including the utility No prior contact with officials
connections. Cost required to complete each procedure (%
The business: of warehouse value)
Official costs only, no bribes
Is a limited liability company operating in
the construction business and located in Will have complete architectural and
the largest business city. For the 11 technical plans prepared by a licensed
economies with a population of more than architect or engineer.
100 million, data for a second city have
Will be connected to water and sewerage
been added. Is domestically owned and
(sewage system, septic tank or their
operated.
equivalent). The connection to each utility
Has 60 builders and other employees. network will be 150 meters (492 feet) long.
The warehouse: Will be used for general storage, such as of
books or stationery (not for goods requiring
Is valued at 50 times income per capita.
special conditions).
Is a new construction (there was no
Will take 30 weeks to construct (excluding all
previous construction on the land).
delays due to administrative and regulatory
requirements).Doing Business 2015 New Zealand 22 DEALING WITH CONSTRUCTION PERMITS Where does the economy stand today? What does it take to comply with the formalities to build business city of an economy, except for 11 economies for a warehouse in New Zealand? According to data which the data are a population-weighted average of the collected by Doing Business, dealing with construction 2 largest business cities. See the chapter on distance to permits there requires 10.0 procedures, takes 93.0 days frontier and ease of doing business ranking at the end of and costs 0.7% of the warehouse value (figure 3.1). this profile for more details. Most indicator sets refer to a case scenario in the largest Figure 3.1 What it takes to comply with formalities to build a warehouse in New Zealand Note: Time shown in the figure above may not reflect simultaneity of procedures. Online procedures account for 0.5 days in the total time calculation. For more information on the methodology of the dealing with construction permits indicators, see the Doing Business website (http://www.doingbusiness.org). For details on the procedures reflected here, see the summary at the end of this chapter. Source: Doing Business database.
Doing Business 2015 New Zealand 23 DEALING WITH CONSTRUCTION PERMITS Globally, New Zealand stands at 13 in the ranking of 189 other useful information for assessing how easy it is for economies on the ease of dealing with construction an entrepreneur in New Zealand to legally build a permits (figure 3.2). The rankings for comparator warehouse. economies and the regional average ranking provide Figure 3.2 How New Zealand and comparator economies rank on the ease of dealing with construction permits Source: Doing Business database.
Doing Business 2015 New Zealand 24
DEALING WITH CONSTRUCTION PERMITS
Smart regulation ensures that standards are met while an effort to ensure building safety while keeping
making compliance easy and accessible to all. Coherent compliance costs reasonable, governments around the
and transparent rules, efficient processes and adequate world have worked on consolidating permitting
allocation of resources are especially important in sectors requirements. What construction permitting reforms has
where safety is at stake. Construction is one of them. In Doing Business recorded in New Zealand (table 3.1)?
Table 3.1 How has New Zealand made dealing with construction permits easier—or not?
By Doing Business report year from DB2010 to DB2015
DB year Reform
New Zealand made dealing with construction permits more
DB2010
costly by raising fees.
Note: For information on reforms in earlier years (back to DB2006), see the Doing Business reports
for these years, available at http://www.doingbusiness.org.
Source: Doing Business database.Doing Business 2015 New Zealand 25
DEALING WITH CONSTRUCTION PERMITS
What are the details?
The indicators reported here for New Zealand are
BUILDING A WAREHOUSE
based on a set of specific procedures—the steps that
a company must complete to legally build a
warehouse—identified by Doing Business through Estimated cost of
information collected from experts in construction NZD 2,523,792
construction :
licensing, including architects, civil engineers,
construction lawyers, construction firms, utility
City : Auckland
service providers and public officials who deal with
building regulations. These procedures are those The procedures, along with the associated time and cost,
that apply to a company and structure matching the are summarized below.
standard assumptions used by Doing Business in
collecting the data (see the section in this chapter on
what the indicators cover).
Table 3.2 Summary of time, cost and procedures for dealing with construction permits in New Zealand
Time to
No. Procedure Cost to complete
complete
Obtain resource consent (planning) from District Council
If the warehouse considered in the Doing Business case study does not
comply with zoning regulations, this procedure would take 100 days
1 and cost NZD 15,000.00. 30 days NZD 2,750
Agency: District Council
* Obtain works over CCTV approval by Watercare Services
If the warehouse considered in the Doing Business case study does not
comply with zoning regulations, this procedure would take 100 days
and cost NZD 15,000.00. This procedure may not be required, 7 days no charge
2
depending on the warehouse location.
Agency: Watercare Services Ltd.
Obtain building consent from District Council
3 30 days NZD 13,044
Agency: Unitary Authority: Auckland Council
Receive foundation inspection by a building inspector from the
Auckland Council
Private certified inspectors were abolished in 2006. Because of the
4 current lack of experienced certifiers at the local government’s district 1 day no charge
council level, there may be delays in obtaining council inspections.
Agency: Unitary Authority: Auckland CouncilDoing Business 2015 New Zealand 26
Time to
No. Procedure Cost to complete
complete
Receive structural inspection by a building inspector from the
Auckland Council
A detailed inspection of the timber structure of the building is required
5 before the roof cladding and building wraps are installed. 1 day no charge
Agency: Unitary Authority: Auckland Council
Receive plumbing inspection by a building inspector from the
Auckland Council
An inspection of plumbing works in any part of the building is required. 1 day no charge
6
Agency: Unitary Authority: Auckland Council
Receive cladding inspection by a building inspector from the
Auckland Council
An inspection of the building wrap and cavity construction is required
7 before the cladding is installed. 1 day no charge
Agency: Unitary Authority: Auckland Council
Receive fire protection inspection by a building inspector from the
Auckland Council
An inspection of any installation of a fire-related product is required in
order to check for compliance with the building consent and the 1 day no charge
8
building code.
Agency: Unitary Authority: Auckland Council
Receive final inspection for a code compliance certificate (CCC)
A final inspection is conducted to confirm that the building work
covered by the approved building consent has been completed and
9 that it complies with the consent and the building code. 20 days no charge
Agency: Unitary Authority: Auckland Council
* Obtain water and sewerage connection
10 The request for water and wastewater service connections is processed 28 days NZD 2,780
within 10 days after receipt of the application. BuildCo will be provided
with a quote to be paid (1 day) and the approval to connect to theDoing Business 2015 New Zealand 27
Time to
No. Procedure Cost to complete
complete
services is issued within 2 days.
The water meter is installed by Watercare’s approved contractor within
15 days, as is the connection to the sewerage system.
Agency: Watercare Services Ltd.
* Takes place simultaneously with another procedure.
Note: Online procedures account for 0.5 days in the total time calculation.
Source: Doing Business database.Doing Business 2015 New Zealand 28
GETTING ELECTRICITY
Access to reliable and affordable electricity is vital for WHAT THE GETTING ELECTRICITY
businesses. To counter weak electricity supply, many
firms in developing economies have to rely on self- INDICATORS MEASURE
supply, often at a prohibitively high cost. Whether
electricity is reliably available or not, the first step for Procedures to obtain an electricity
a customer is always to gain access by obtaining a connection (number)
connection.
Submitting all relevant documents and
What do the indicators cover? obtaining all necessary clearances and permits
Doing Business records all procedures required for a Completing all required notifications and
local business to obtain a permanent electricity receiving all necessary inspections
connection and supply for a standardized warehouse,
as well as the time and cost to complete them. These Obtaining external installation works and
procedures include applications and contracts with possibly purchasing material for these works
electricity utilities, clearances from other agencies Concluding any necessary supply contract and
and the external and final connection works. The obtaining final supply
ranking of economies on the ease of getting
electricity is determined by sorting their distance to Time required to complete each procedure
frontier scores for getting electricity. These scores are (calendar days)
the simple average of the distance to frontier scores Is at least 1 calendar day
for each of the component indicators. To make the
data comparable across economies, several Each procedure starts on a separate day
assumptions are used. Does not include time spent gathering
The warehouse: information
Is owned by a local entrepreneur, located Reflects the time spent in practice, with little
in the economy’s largest business city, in follow-up and no prior contact with officials
an area where other warehouses are Cost required to complete each procedure
located. For the 11 economies with a (% of income per capita)
population of more than 100 million, data
Official costs only, no bribes
for a second city have been added.
Excludes value added tax
Is not in a special economic zone where
the connection would be eligible for
subsidization or faster service. Is to either the low-voltage or the medium-
voltage distribution network and either
Is located in an area with no physical
overhead or underground, whichever is more
constraints (ie. property not near a railway).
common in the area where the warehouse is
Is a new construction being connected to located. Included only negligible length in the
electricity for the first time. customer’s private domain.
Is 2 stories, both above ground, with a total Requires crossing of a 10-meter road but all
surface of about 1,300.6 square meters the works are carried out in a public land, so
(14,000 square feet), is built on a plot of there is no crossing into other people's
929 square meters (10,000 square feet), is private property.
used for storage of refrigerated goods
Involves installing one electricity meter. The
The electricity connection: monthly electricity consumption will be
26880 kilowatt hour (kWh). The internal
Is 150 meters long and is a 3-phase, 4-wire
electrical wiring has been completed.
Y, 140-kilovolt-ampere (kVA) (subscribed
capacity) connection.Doing Business 2015 New Zealand 29
GETTING ELECTRICITY
Where does the economy stand today?
What does it take to obtain a new electricity connection Most indicator sets refer to a case scenario in the largest
in New Zealand? According to data collected by Doing business city of an economy, except for 11 economies for
Business, getting electricity there requires 5.0 procedures, which the data are a population-weighted average of the
takes 64.0 days and costs 78.7% of income per capita 2 largest business cities. See the chapter on distance to
(figure 4.1). frontier and ease of doing business ranking at the end of
this profile for more details.
Figure 4.1 What it takes to obtain an electricity connection in New Zealand
Note: Time shown in the figure above may not reflect simultaneity of procedures. For more information on the methodology of the
getting electricity indicators, see the Doing Business website (http://www.doingbusiness.org). For details on the procedures reflected
here, see the summary at the end of this chapter.
Source: Doing Business database.Doing Business 2015 New Zealand 30 GETTING ELECTRICITY Globally, New Zealand stands at 48 in the ranking of 189 average ranking provide another perspective in assessing economies on the ease of getting electricity (figure 4.2). how easy it is for an entrepreneur in New Zealand to The rankings for comparator economies and the regional connect a warehouse to electricity. Figure 4.2 How New Zealand and comparator economies rank on the ease of getting electricity Source: Doing Business database.
Doing Business 2015 New Zealand 31
GETTING ELECTRICITY
What are the details?
The indicators reported here for New Zealand are based
OBTAINING AN ELECTRICITY CONNECTION
on a set of specific procedures—the steps that an
entrepreneur must complete to get a warehouse
connected to electricity by the local distribution utility— Name of utility: Vector Limited
identified by Doing Business. Data are collected from the
distribution utility, then completed and verified by
City: Auckland
electricity regulatory agencies and independent
professionals such as electrical engineers, electrical The procedures are those that apply to a warehouse and
contractors and construction companies. The electricity electricity connection matching the standard
distribution utility surveyed is the one serving the area assumptions used by Doing Business in collecting the
(or areas) in which warehouses are located. If there is a data (see the section in this chapter on what the
choice of distribution utilities, the one serving the largest indicators cover). The procedures, along with the
number of customers is selected. associated time and cost, are summarized below.
Table 4.2 Summary of time, cost and procedures for getting electricity in New Zealand
Time to
No. Procedure Cost to complete
complete
Customer contacts the line company (distribution utility), Vector,
and requests a new connection account, and Vector contractor does
site visit to prepare estimate
Vector is the lines company servicing the greater Auckland Region.
Vector installs and maintains the reticulation network which is generally
located within the public domain and carries out the works necessary to
connect customers. Vector charges the customer monthly line charges
according to published rates. These are recovered by the customer's
chosen retailer through the retailer's invoice.
1 Once Vector receives the request for a new Commercial connection via 21 calendar days NZD 0
the call centre or directly, then the request is logged into our Customer
management database and issued to the Service Provider for pricing.
Pricing with the Service Provider takes approx. two weeks. The Service
Provider will conduct a site visit with the customer and often a Vector
representative. Once the job is designed and scoped a price will be
provided to Vector who will complete a contract (this takes approx. 1
week)
Agency: Vector Electricity Network
* Submit application for electricity connection with retailer (Mercury
Energy) and receive, sign and submit electricity supply contract.
Application can be submitted via faxed form or via telephone with the 6 calendar days NZD 240
2
business center. The business team then runs a credit check on the
customer. Depending on the credit check, the retailer will decide whether
the customer has to provide a bond or not. This supply contract can be
received either online or by mail (as per customer’s instructions). It canDoing Business 2015 New Zealand 32
Time to
No. Procedure Cost to complete
complete
be signed, scanned and sent back or mailed back. The customer has a
choice of some 8 retailers. Mercury is the encumbant retailer in the
Auckland (Vector) area.
Agency: Mercury Energy
Receive quotation from Vector via email, and make payment and
Vector conducts external connection works
Contract is emailed and posted to the customer. The contract is then
signed and returned to Vector who approve with the contribution
received from the customer as requested in the contract. Approval
process takes 7 days. The project is then issued to the Service provider
responsible to complete the onsite work. All approvals and resource
consents are requested by the Service Provider who schedules the work
3 dependent on the expected date of these consents being issued 34 calendar days NZD 39,500
(Generally 3-4 weeks). This work is then coordinated and completed by
the Service provider in coordination with the customer. The customer
dictates the dates for the work to be completed. The utility also obtains
a specific Resource Consent application for crossing a road (from
Auckland Council).
Agency: Vector Electricity Network
Electrician provides Certificate of compliance (CoC) to retailer and
requests meter installation
Electrician must issue a Certificate of Compliance (CoC) to customer and
retailer when doing any fixed wiring work, including fitting new power
points. CoC's are not issued for maintenance work, such as replacing
sockets and light fittings or repairing appliances. The CoC indicates that
the work done is electrically safe and has been carried out in accordance
4 with New Zealand’s electrical safety standards and codes. It also shows 8 calendar days NZD 0
they have tested their work once completed. A CoC guarantees that the
work has been completed by a licensed electrician; meets safety
standards set by law, and has been tested. The retailer has private meter
distribution contractors who do the installation
Agency: Electrician
Customer contacts Vector and requests and receives final inspection
and electricity is turned on
5 The customer, electrician or retailer requests livening of the supply. 1 calendar day NZD 0
Vector will then inspect the COC before livening the supply through to
the customer fuse pillar on the boundary. The inspector will then liven
the customer premises when the installation is complete, including theDoing Business 2015 New Zealand 33
Time to
No. Procedure Cost to complete
complete
meter installation.
Agency: Vector Electricity Network
* Takes place simultaneously with another procedure.
Source: Doing Business database.You can also read
