Government-owned land disposal simplified

Cabinet has rescinded the Land of Potential Interest Process, which governed and restricted the disposal by Crown entities and State Owned Enterprises (SOEs) of land with special values.

Responsibility for protecting those values is now vested with the agency holding the land, rather than a process involving Land Information New Zealand and Cabinet.

This Brief Counsel looks at how the new regime will work.

In 2007, the previous Labour Government introduced a process for the disposal of "land of potential interest" by Crown entities and SOEs, which was intended to ensure that conservation, recreation, heritage or cultural values were considered.  The proposed sale or long-term lease of the land had to be referred to Land Information New Zealand (LINZ) to determine whether there were any such values that required protection.  A committee of Cabinet Ministers then had the final decision on whether the disposal could proceed or how those values could be protected.  The result was much double-handling and duplication of existing statutory processes.  Cabinet has now abandoned that policy, and will require the SOE or Crown entity holding the land to make its own inquiries and ensure that these values are protected. 

Criteria for protection

Values include:

  • conservation values (such as endangered flora and fauna, wetlands, coastal sand dunes and biodiversity)

  • historic places (archaeological sites, historic sites and structures and wahi tapu sites and areas, whether registered or not)

  • potential recreational uses, including walking access

  • sites of heritage and cultural significance to Māori, and

  • land of potential use in Treaty settlements.


Agencies who are proposing to sell or grant long-term leases of land they hold are now responsible for making their own assessment of whether that land has values that require protection.  Agencies seeking expert advice are advised to contact the Department of Conservation (DOC), the Historic Places Trust, Sport and Recreation (SPARC), Te Puni Kokiri (TPK) and/or the Office of Treaty Settlements, as appropriate.

If significant values are identified, the appropriate oversight agency should be notified (such as Crown Companies Monitoring Unit for SOEs).  The shareholding or responsible Minister should also be informed on a “no surprises” basis.

Other disposal mechanisms such as the Mechanism for the Protection of Māori Interests, the Sites of Significance procedure, notification to DOC, Housing Corporation and the Historic Places Trust will continue to apply to the agencies subject to those processes.

LINZ is developing best practice guidelines that will apply under the revised process.  The new regime will be reviewed by December 2010.


This change in process is a very sensible and welcome one.  It confirms that responsibility for appropriate land disposal decisions rests with the SOE or Crown entity holding the land, rather than prescribing a slow and complicated process that duplicates existing processes.

For further information, please contact the lawyers featured.

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