NEW ZEALAND Government Bonds

Transcription

1 NEW ZEALAND Government Bonds INVESTMENT STATEMENT DATED 15 FEBRUARY 2007 FOR THE PURPOSE OF THE SECURITIES ACT 1978 IMPORTANT INFORMATION (The information in this section is required under the Securities Act 1978.) Investment decisions are very important. They often have long-term consequences. Read all documents carefully. Ask questions. Seek advice before committing yourself. C HOOSING A N I NVESTMENT When deciding whether to invest, consider carefully the answers to the following questions that can be found on the pages noted below: What sort of investment is this? Who is involved in providing it for me? How much do I pay? What are the charges? What returns will I get? What are my risks? Can the investment be altered? How do I cash in my investment? Who do I contact with enquiries about my investment? Is there anyone to whom I can complain if I have problems with the investment? What other information can I obtain about this investment? Page C HOOSING A N I NVESTMENT A DVISER You have the right to request from any investment adviser a written disclosure statement stating his or her experience and qualifications to give advice. That document will tell you - Whether the adviser gives advice only about particular types of investments; and Whether the advice is limited to the investments offered by 1 or more particular financial organisations; and Whether the adviser will receive a commission or other benefit from advising you. You are strongly encouraged to request that statement. An investment adviser commits an offence if he or she does not provide you with a written disclosure statement within 5 working days of your request. You must make the request at the time the advice is given or within 1 month of receiving the advice. In addition - If an investment adviser has any conviction for dishonesty or has been adjudged bankrupt, he or she must tell you this in writing; and 1

2 If an investment adviser receives any money or assets on your behalf, he or she must tell you in writing the methods employed for this purpose. Tell the adviser what the purpose of your investment is. This is important because different investments are suitable for different purposes. WHAT SORT OF INVESTMENT IS THIS? This Investment Statement relates to New Zealand Government Bonds ( Bonds ) which have been previously allotted by Her Majesty the Queen in right of New Zealand ( the Crown ) to successful registered bidders in a Government Bond tender or to financial or other institutions in a private placement. Bonds are fixed-term debt securities, secured by a charge upon and payable out of the revenues of the Crown. Bonds are denominated in New Zealand dollars with a fixed coupon paid semi-annually in arrears. Bonds are redeemable at face value on maturity. The Bonds were issued in terms of Part 6 of the Public Finance Act The Crown may specify from time to time intended uses (such as investment in infrastructure) for funds it raises through the issue of Bonds, or issue Bonds branded in a particular way (such as "Infrastructure Bonds ). Regardless of any such statements of intention or branding, the Crown reserves its ongoing discretion to assess its priorities and use any funds raised for any purpose it considers appropriate. Any bonds issued with such statements of intention or branding will be New Zealand Government Bonds and will be issued on the same terms as other New Zealand Government Bonds. WHO IS INVOLVED IN PROVIDING IT FOR ME? The Bonds are issued by Her Majesty the Queen in right of New Zealand ( the Crown ), through the New Zealand Debt Management Office of the Treasury ( NZDMO ). The party offering to sell the Bonds to you ( the Seller ) will either have been a successful registered bidder in a Government Bond tender or will have purchased the Bonds in a private placement or on the secondary market. Under the Securities Act 1978, the Crown and the Seller of the Bonds are the issuers of the Bonds. Every Seller, as an offeror, has obligations as an issuer under the Securities Act 1978 and the Securities Regulations The Securities Act (Crown Wholesale Debt Securities) Exemption Notice 2004 ( Exemption Notice ) provides exemptions in relation to the content of this Investment Statement. The effect of the exemption in clause 5 of the Exemption Notice is that this Investment Statement contains information about the Crown as the issuer of the Bonds, but is not required to also contain information about the Sellers who are offerors of the Bonds. The Securities Act 1978 requires the Seller and the Crown to provide members of the public with a copy of this Investment Statement prior to subscription for the Bonds, when the Bonds offered for sale by the Seller have not previously been offered to the public. The Seller is required to provide you with details of its name and address before selling the Bonds to you. Communications to the Seller should be sent to that address. Computershare Investor Services Limited ( Computershare ), acting as agent for the NZDMO, is the Registrar. The Crown reserves the right to appoint another person as its registrar or a paying agent or for the NZDMO to perform those functions. In such circumstances, Bondholders will be advised at the relevant time. Communications to Computershare should be addressed to the Registrar, Level 2, 159 Hurstmere Road, Takapuna, Private Bag 92119, Auckland 1020, or Freephone , Tel (09) , Fax (09) or enquiry@computershare.co.nz. The Crown s address is c/- the Information Services Manager, New Zealand Debt Management Office, The Treasury, 1 The Terrace, PO Box 3724, Wellington, Tel (04) or (04) , Fax (04) or info@nzdmo.govt.nz. 2

3 New Zealand is a sovereign state whose constitutional history dates back to the signing of the Treaty of Waitangi in New Zealand has a market economy with sizeable manufacturing and service sectors that complement a highly efficient, export-orientated agricultural sector. HOW MUCH DO I PAY? You may purchase the Bonds from the Seller upon completion of a transfer request in the form prescribed by the Registrar, in parcels having a minimum Principal of $10,000 and multiples of $1,000 thereafter. The price that must be paid for the Bonds will be calculated by reference to the market for such securities, and will be agreed by you with the Seller at the time of sale. Details of the person to whom, and the place(s) at which, payment for the Bonds offered to you are to be or may be made are required to be provided to you before the Bonds are sold to you. If the Seller has not already provided you with this information, you should ask for it. The Crown will not receive any of the proceeds of the sale of the Bonds to you by the Seller. The offer of Bonds under this Investment Statement is made only to New Zealand residents. No offer or invitation is to be made under this Investment Statement in any jurisdiction outside New Zealand. No person may offer, sell or deliver any Bonds or distribute any documents (including this Investment Statement) to any person outside New Zealand except in accordance with all of the legal requirements of the relevant jurisdiction. Unless otherwise agreed with the Crown, any person or entity purchasing Bonds will, by virtue of the purchase, be deemed to represent that he, she or it is not in a jurisdiction that does not permit the making of an offer or invitation of the kind contained in this document and is not acting for the account or benefit of a person within such a jurisdiction. WHAT ARE THE CHARGES? No fees, duty, charges, deductions or levies (except to the extent required by law) are payable by you to the Crown or the Registrar for the registration, transfer, Coupon Interest payment, Principal repayment, issue of certificates of title and certifications of transfers (markings) of Bonds. Transaction fees or charges may be payable to the Seller, which should be calculated at the Seller s rates for the sale of Bonds. You should ask the Seller for details of any such fees and charges. WHAT RETURNS WILL I GET? You are entitled to repayment of the Principal amount of your Bonds by the Crown at the Maturity Date for your Bonds. You will receive Coupon Interest on your Bonds at the Coupon Interest Rate. Coupon Interest is payable semiannually (half the annual amount) in arrears on each Coupon Interest Payment Date up to and including the Maturity Date. You should contact the Seller to obtain details of the Maturity Date, Coupon Interest Rate and Coupon Interest Payment Dates for the Bonds. The notice of registration issued to you by the Registrar will also contain this information. The first Coupon Interest payment will be for a full semi-annual period and will be payable on the Coupon Interest Payment Date next following the issue of the Bonds. However, if the date on which the Bonds are issued is in the period from the Record Date up to, but not including, the Coupon Interest Payment Date, the payment (which will only be for a full semi-annual period) will be made on the next succeeding Coupon Interest Payment Date. Coupon Interest will cease to accrue on the Bonds from the Maturity Date. Coupon Interest payments are domiciled for payment in New Zealand and will be paid to the Bondholder Registered on the Record Date by crediting an account at any Registered Bank in New Zealand. 3

4 If a bank account has not been provided, the Coupon Interest and Principal will be withheld until account details have been provided. No interest will be paid on any amounts withheld. If the Coupon Interest Payment Date is not a Banking Day, payment will be made on the next succeeding Banking Day without payment of additional interest. Her Majesty the Queen in right of New Zealand ( the Crown ) is the person liable to pay the returns to investors. No other person or persons are liable to pay the returns if the Crown is unable to repay all or any of your Principal and/or Coupon Interest when it becomes due. The return on the Bonds is not quantifiable as at the date of this Investment Statement, and no amount of returns is promised. The key factors that will determine your overall rate of return are the Coupon Interest Rate for the Bonds and the price that you agree with the Seller for the Bonds. You should contact the Seller for details of the overall rate of return. TAXATION Taxation is likely to affect returns to investors. The Issuer and the Registrar will be entitled to rely upon information given by a Bondholder as to that Bondholder s residency when making any necessary deductions or withholdings from interest payable to you for Tax including, but not limited to, Resident Withholding Tax and Non-Resident Withholding Tax. The Registrar will assume a Bondholder (and any other person who beneficially derives Interest under the Bonds jointly with a Bondholder) is either Resident in New Zealand or carries on business in New Zealand through a Fixed Establishment. Resident Withholding Tax will be deducted from Interest paid to Bondholders, unless an original or certified copy of a valid exemption certificate for the purposes of Resident Withholding Tax is produced to the Registrar before the Record Date of the relevant Interest Payment Date. A Bondholder who provides its IRD number to the Registrar may elect for Resident Withholding Tax to be deducted at the rate of 19.5%, 33% or 39% (although the 19.5% rate cannot be elected by a corporate Bondholder, unless it is a trustee company). Resident Withholding Tax will be deducted at 19.5% if a Bondholder provides its IRD number to the Registrar but makes no election, unless it is a corporate, in which case 33% will apply. If a Bondholder does not provide its IRD number to the Registrar, Resident Withholding Tax will be deducted at a rate of 39%. A Bondholder who is not a New Zealand Resident or who does not carry on business in New Zealand through a Fixed Establishment should notify the Registrar. If the Registrar is satisfied a Bondholder is not a New Zealand Resident and does not carry on business in New Zealand through a Fixed Establishment, the Registrar will deduct Non-Resident Withholding Tax from Interest at the applicable rate (at the date of this Investment Statement, 15%, or 10% if the Bondholder is resident in a country with which New Zealand has a double tax treaty providing for such a reduction). The Bonds are Registered Securities for the purposes of the Approved Issuer Levy regime in Part VI B of the Stamp and Cheque Duties Act Upon request, the Registrar may agree to reduce the Non-Resident Withholding Tax to 0% and instead the Crown will pay on its account the Approved Issuer Levy (at the date of this Investment Statement, 2% of the amount of gross Interest paid). Interest derived by Bondholders may be subject to tax under the New Zealand accrual rules. The accrual rules apply to New Zealand Residents, and to non-residents to the extent the Bonds relate to a business carried on by the non-resident through a Fixed Establishment in New Zealand. 4

5 Under the accrual rules, gains on the sale of Bonds will be taxable to New Zealand Residents and non- Residents to the extent the Bonds relate to a business carried on by the Bondholder through a Fixed Establishment in New Zealand. Other non-residents may also be subject to tax on such gains. You should consult your own taxation adviser about the effect of any taxes on your investment. WHAT ARE MY RISKS? Because the Crown is the issuer of Bonds and uses the proceeds of Bonds for general or specific Crown purposes, there are no particular investment risks that are relevant. The only risk you have of not recovering the money you pay for Bonds (other than if you pay an amount greater than the Principal, as described below), receiving repayment of the Principal amount on maturity, or receiving Coupon Interest payments is that the Crown could default on its obligations under the Bonds. This is a most unlikely event. The Crown has always paid when due the full amount of principal, interest and amortisation requirements on its debt. Reflecting the Crown s creditworthiness, at the date of this Investment Statement, the Bonds are rated AAA by Standard and Poor s Ratings Group and Aaa by Moody s Investors Service. There are no circumstances in which you could be required to pay any more money for Bonds than the agreed purchase price for the Bonds. The Crown will repay the Principal amount of your Bonds on the maturity of those Bonds without regard to the amount that you paid to the Seller for the Bonds. Therefore, if the price paid by you to the Seller was higher than the Principal amount of the Bonds, it is reasonably foreseeable that the Principal repaid to you on the maturity of the Bonds will be less than that purchase price. C ONSEQUENCES OF I NSOLVENCY Although the Crown could in theory (see What Are My Risks? above) default on its obligations under the Bonds, it cannot be put into liquidation or wound up. Accordingly, the provisions of general New Zealand law which give priority to certain creditors over other creditors in the liquidation or winding up of a debtor do not apply to the Crown. Claims of all creditors of the Crown would be brought under, and governed by, the Crown Proceedings Act CAN THE INVESTMENT BE ALTERED? The Crown or agencies of the Crown may at any time offer to purchase, beneficially, Bonds from any person. Any Bonds so purchased may be lent, retained, sold or cancelled at the discretion of the Crown. The Issuer may, on application by Bondholders, permit the separation of Bonds into the Principal and the Coupon Interest components (Bond STRIPS (Separate Trading of Registered Coupon Interest and Principal Securities)). Bondholders may sell or transfer some or all of their Bonds to any other person. See How do I cash in my investment? for details. 5

6 HOW DO I CASH IN MY INVESTMENT? Bonds are not repayable prior to the Maturity Date. Bonds are domiciled for payment in New Zealand and will be repaid to the Bondholder Registered on the Record Date immediately prior to the Maturity Date by crediting an account at any Registered Bank in New Zealand. Payment will be made on the Maturity Date, but if the Maturity Date is not a Banking Day, payment will be made on the next succeeding Banking Day without payment of additional interest. Holders of the Coupon Interest component of Bonds will not be entitled to any repayment of Principal, but will be paid Coupon Interest as referred to above in the section entitled What Returns will I Get? Bondholders may sell or transfer any or all of their Bonds to any person, at any time prior to the Record Date immediately prior to the Maturity Date, provided transfers are in multiples of $1,000 and the Principal of the Bonds Registered in the name of the transferor or the transferee after the transfer will be at least $10,000. The Crown believes that there is an established market for the sale of Bonds. WHO DO I CONTACT WITH ENQUIRIES ABOUT MY INVESTMENT? In the first instance, you should contact the Registrar with any enquiries about your investment, at: The Manager, Fixed Interest Registry Computershare Investor Services Limited Level 2, 159 Hurstmere Road Takapuna Private Bag Auckland 1020 Freephone: Tel: (09) Fax: (09) enquiry@computershare.co.nz If your enquiry is not resolved, you may contact the Issuer, at: The Information Services Manager New Zealand Debt Management Office The Treasury 1 The Terrace PO Box 3724 Wellington Tel: (04) or (04) Fax: (04) info@nzdmo.govt.nz IS THERE ANYONE TO WHOM I CAN COMPLAIN IF I HAVE PROBLEMS WITH THE INVESTMENT? If you have any complaints or problems with your investment, you should contact the Manager, Fixed Interest Registry at Computershare Investor Services Limited, Level 2, 159 Hurstmere Road, Takapuna, Private Bag 92119, Auckland 1020, Freephone , Tel (09) , Fax (09) , or enquiry@computershare.co.nz. If you are unhappy with the response you receive, you can contact the Crown, c/- Information Services Manager, New Zealand Debt Management Office, The Treasury, 1 The Terrace, PO Box 3724, Wellington, Tel (04) or (04) , Fax (04) or info@nzdmo.govt.nz. If the Seller is a participant of the Insurance and Savings Ombudsman Scheme ( ISO Scheme ), you may contact the Insurance and Savings Ombudsman, Level 7, BDO House, Customhouse Quay, PO Box , Wellington, Freephone As at the date of this Investment Statement, a list of participants of the ISO Scheme is available at 6

7 If the Seller is a Bank you may contact the Banking Ombudsman, 109 Featherston Street, PO Box , Wellington, Tel (04) Complaints in relation to the Bonds can also be made to the Ombudsmen. The Ombudsmen can be contacted at Level 14, 70 The Terrace, PO Box 10152, Wellington, Telephone (04) W HAT O THER I NFORMATION C AN I O BTAIN A BOUT T HIS I NVESTMENT? Further information about the Crown is detailed in the Crown s financial statements. A copy of the Crown s financial statements and additional information can be obtained free of charge from the NZDMO website, Investors can request free of charge a certificate which evidences title to their Bonds as recorded on the Register. They may request free of charge a certified extract from the Register which confirms the details of their investment. Requests should be made to the Registrar, at the address or on the telephone number given above. A notice of registration for Bonds will be issued by the Registrar to the transferee following the registration of a transfer. These notices do not constitute a certificate of title but merely advise the registration of Bonds. A notice will be issued by the Registrar to the transferor following the registration of a transfer of Bonds. P RIVACY Computershare Investor Services Limited, as Registrar and agent for the Crown and the NZDMO, collects and holds personal information about Bondholders for the purposes of administering this investment. This information may be disclosed to the Crown and the NZDMO. Investors may request access to any personal information held about them by contacting the Manager Fixed Interest Registry on or (09) , fax (09) or enquiry@computershare.co.nz. Investors may also request correction of any personal information held about them. Depending on the nature of an investor s request, the Registrar may impose a charge for providing or correcting any personal information. Failure to provide the requested information on the transfer form may result in a delay in processing the transfer and further information being sought from the investor. GLOSSARY OF TERMS For the purposes of this Investment Statement, the following definitions apply: Approved Issuer Levy Banking Day Bondholder Bonds Coupon Interest Coupon Interest Payment Dates Has the meaning ascribed to that term in Part VI of the Stamp Duty Act Means a day not being a Saturday or Sunday on which Registered Banks are open for general banking business in Wellington, New Zealand. Means, in respect of any Bond, the person whose name from time to time is entered in the Register as the holder of that Bond. Means the New Zealand Government Bonds covered by this Investment Statement. Means the amount paid or due to be paid on the Coupon Interest Payment Date. Means the dates in each year on which Coupon Interest is to be paid on the Bonds, as recorded in the Register and includes the Maturity Date. 7

8 Coupon Interest Rate Crown Dollars and $ Fixed Establishment Interest Issuer Maturity Date Means the interest rate payable in respect of Bonds, expressed as a percentage per annum, as recorded in the Register. Means Her Majesty the Queen in right of New Zealand. Means the lawful currency of New Zealand. Has the meaning ascribed to that term in the Income Tax Act 1994 or the Income Tax Act 2004, as applicable (as modified by any double taxation treaty to which New Zealand is a party). Means a payment defined as such in the Income Tax Act 1994 or the Income Tax Act 2004 as applicable. Means Her Majesty the Queen in right of New Zealand ( the Crown ). Means the date on which the Bonds are to be repaid, as recorded in the Register. Non-Resident Withholding Tax Has the meaning ascribed to that term in the Income Tax Act 1994 or the Income Tax Act 2004, as applicable. NZDMO Person Principal Record Date Register Registered Bank Registrar Resident Resident Withholding Tax Tax Means the New Zealand Debt Management Office of the Treasury. Includes an individual, firm, company, corporation or any state or Government or any agency thereof (in each case, whether or not having separate legal personality). Means the face, or nominal, amount of the Bond on which Coupon Interest is calculated. Means close of business on the 10th day before the relevant Coupon Interest Payment Date or the Maturity Date or, if this is not a Banking Day, the preceding Banking Day. Means the Register of Bonds maintained by the Registrar and Registered has a corresponding meaning. Has the meaning given to that term in the Reserve Bank of New Zealand Act Means Computershare Investor Services Limited acting as agent for the NZDMO. Means a Person defined as Resident in New Zealand pursuant to the Income Tax Act 1994 or the Income Tax Act 2004, as applicable. Has the meaning ascribed to that term in the Income Tax Act 1994 or the Income Tax Act 2004, as applicable. Means any tax, levy, duty, rate or tariff of any nature, including withholding taxes, which is imposed or collected by a Government Agency. 8