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Choosing an executor for your Will - a trap to be wary of

By Steven Lee and Rika Louw - 15 Jun 2020

If the executor of your Will or administrator of your estate is an overseas person, they must apply to the Overseas Investment Office for an exemption for any residential property to be transmitted to them. Changes made in October 2018 to the Overseas Investment Act 2005 (OIA) mean that an estate with an overseas executor/administrator is likely to be affected by the regime.

An overseas person is unable to take an interest in residential land without the consent of the Overseas Investment Office (OIO), unless they fall under an exemption.

There are two classes of transactions to consider:

  • first, the transmission of an interest in sensitive land (or shares in a company that owns sensitive land) to the trustee, executor, or administrator of the estate ("Administrator"); and
  • second, the transfer of those assets to the beneficiary of the estate.

While Regulation 40(1)(b) of the Overseas Investment Regulations 2005 exempts the second step, no such statutory or regulatory exemption currently exists for the first step, being the transmission to an Administrator who is an overseas person.

Equally, no clear consent pathway exists which will permit a transmission to the Administrator.

Pursuant to the powers under section 61B of the OIA to manage impractical, inefficient, or burdensome issues with the OIA, the OIO has created a (special) exemption pathway for transmissions to Administrators.  As this is not a standard exemption, the Administrator must complete an application to obtain such an exemption.  This process involves completing a short application form and submitting it electronically to the OIO.

The OIO advises that an exemption should be sought before Probate or Letters of Administration are granted by the High Court.

Martelli Mckegg Lawyers specialise in overseas investment laws and trust and estate matters. It is important for overseas Administrators to seek legal advice from lawyers with overseas investment expertise given that the OIO has the power to impose penalties on those people who do not comply with the OIA.


Steven Lee

Rika Louw


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