Asset Purchase Agreement (New Zealand)
Asset Purchase Agreement
This Asset Purchase Agreement (Agreement) is entered into on [Agreement Date] between [Vendor Name] (NZBN [Vendor NZBN]) of [Vendor Address], represented by [Vendor Representative] (Vendor) and [Purchaser Name] (NZBN [Purchaser NZBN]) of [Purchaser Address], represented by [Purchaser Representative] (Purchaser).
This Agreement is governed by the laws of New Zealand, including the Contract and Commercial Law Act 2017 (CCLA), the Goods and Services Tax Act 1985, the Employment Relations Act 2000, and the Commerce Act 1986 where applicable.
1. Sale and Purchase of Assets
1.1 Sale. The Vendor agrees to sell, and the Purchaser agrees to purchase, the following assets (Assets) on the terms and conditions of this Agreement: [Assets Description].
1.2 Assigned contracts. The following contracts are assigned from the Vendor to the Purchaser as part of this Agreement (subject to obtaining any required counterparty consent under the Contract and Commercial Law Act 2017): [Included Contracts].
1.3 Excluded assets. The following assets are specifically excluded from this sale and are retained by the Vendor: [Excluded Assets].
1.4 Assumed liabilities. The Purchaser assumes only the following liabilities of the Vendor, and no others: [Assumed Liabilities]. Save as expressly stated in this clause, the Purchaser does not assume, and the Vendor retains, all other liabilities of the Vendor including all debts, accounts payable, tax liabilities, and other obligations arising prior to completion.
2. Purchase Price, GST, and Deposit
2.1 Purchase price. The total purchase price for the Assets is [Purchase Price] (Purchase Price).
2.2 GST. [GST Treatment]. The parties agree to comply with all requirements of the Goods and Services Tax Act 1985 in relation to this transaction, including issuing a valid tax invoice.
2.3 Deposit. A deposit of [Deposit Amount] is payable on execution of this Agreement. The deposit shall be held by the vendor's lawyer in trust until completion.
2.4 Balance. The balance of [Balance Payable] is payable on the completion date in cleared funds.
2.5 Price allocation. The Purchase Price is allocated between the asset classes as follows: [Price Allocation]. The parties agree to adopt this allocation for tax purposes (including depreciation under the Income Tax Act 2007) and to file consistent tax positions with Inland Revenue.
3. Conditions Precedent and Completion
3.1 Conditions. This Agreement is conditional on the following conditions being satisfied or waived by [Satisfaction Date]: [Conditions].
3.2 Satisfaction. Each party must use reasonable endeavours to satisfy the conditions. If a condition has not been satisfied or waived by the satisfaction date, either party may cancel this Agreement by written notice, and the deposit shall be refunded to the Purchaser without deduction (unless the failure to satisfy the condition is due to the Purchaser's default).
3.3 Completion. Completion of the sale and purchase of the Assets shall occur on [Completion Date] at [Completion Place]. At completion: (a) the Vendor shall deliver to the Purchaser executed transfers and all documents of title and records relating to the Assets; and (b) the Purchaser shall pay the balance of the Purchase Price in cleared funds.
4. Employees
4.1 Employee transfer. Employees are being transferred to the Purchaser: [Employees Transferred]. Where employees are being transferred, the Purchaser acknowledges its obligations under section 69I of the Employment Relations Act 2000 in relation to the restructuring provisions applicable to a business sale. Transferred employees: [Employee Details].
5. Restraint of Trade
5.1 Restraint. A restraint of trade applies: [Restraint of Trade]. For the period of [Restraint Period], the Vendor must not within [Restraint Area]: [Restraint Activities]. The Vendor acknowledges that this restraint is reasonable and necessary to protect the legitimate business interests of the Purchaser in the goodwill and confidential information of the business being purchased.
6. Representations and Warranties
6.1 Vendor warranties. The Vendor represents and warrants to the Purchaser that: (a) the Vendor has full power and authority to sell the Assets; (b) the Vendor holds clear legal and beneficial title to the Assets free from all encumbrances (other than as disclosed); (c) the Assets are in good working order and condition, fair wear and tear excepted; (d) the business has been conducted in the ordinary course since the date of the most recent financial statements; (e) all material contracts assigned under this Agreement are valid and subsisting; (f) there are no pending or threatened legal proceedings relating to the Assets or the business; and (g) the Vendor is not aware of any fact or circumstance that would constitute a material breach of any warranty in this Agreement.
6.2 Disclosure. The Vendor must disclose in writing all matters that may make any warranty in clause 6.1 incorrect or misleading. Disclosed matters do not give rise to a warranty claim.
6.3 Limitations. Claims for breach of warranty must be notified in writing within 12 months after completion. No claim may be made for an amount less than NZD $5,000. The total liability of the Vendor for warranty claims is limited to the Purchase Price.
7. General Terms
7.1 Governing law. This Agreement is governed by and construed in accordance with the laws of New Zealand. The parties submit to the non-exclusive jurisdiction of the New Zealand courts.
7.2 Entire agreement. This Agreement constitutes the entire agreement between the parties in relation to the purchase and sale of the Assets and supersedes all prior representations, negotiations, and agreements.
7.3 Amendment. This Agreement may only be amended by written agreement signed by both parties.
7.4 Special conditions. The following special conditions apply: [Special Conditions].
Vendor
________________
Signature
Purchaser
________________
Signature
Witness to Vendor's signature
________________
Signature
Witness to Purchaser's signature
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Signature
What Is a Asset Purchase Agreement (New Zealand)?
An Asset Purchase Agreement in New Zealand transfers ownership of a business or its assets from seller to buyer and records the price, assets included, and warranties given, with the sale governed by the Companies Act 1993.
The Contract and Commercial Law Act 2017 replaced and consolidated the Contractual Remedies Act 1979, the Contracts (Privity) Act 1982, and the Illegal Contracts Act 1970. The CCLA governs formation, performance, breach, and remedies. Additional statutes that apply to New Zealand asset purchases include the Goods and Services Tax Act 1985 (for GST treatment and the going concern zero-rating under section 11(1)(m)), the Employment Relations Act 2000 (for employee transfer obligations under sections 69I to 69OA), the Commerce Act 1986 (for merger clearance by the Commerce Commission where required), the Fair Trading Act 1986, and the Health and Safety at Work Act 2015. Where the target business includes land, the Overseas Investment Act 2005 may require consent from the Overseas Investment Office (OIO).
Asset purchases are a common transaction structure in New Zealand because they allow the purchaser to acquire the commercial benefit of a business — customer relationships, goodwill, intellectual property, plant, and equipment — without inheriting the vendor company's historical liabilities. The Inland Revenue Department (IRD) requires purchase price allocation between asset classes, and the Goods and Services Tax Act 1985 zero-rating for going concern supplies requires both parties to be GST-registered and to include an express going concern agreement in writing.
A well-drafted New Zealand Asset Purchase Agreement covers: description of purchased and excluded assets; assumed liabilities; purchase price, GST treatment, and price allocation; conditions precedent including due diligence, landlord consent, and Commerce Commission or OIO clearance; completion mechanics; employee transfer under the Employment Relations Act 2000; restraint of trade; and vendor warranties with limitation of liability. The forms-legal.com Asset Purchase Agreement (New Zealand) template addresses all of these requirements.
When Do You Need a Asset Purchase Agreement (New Zealand)?
An Asset Purchase Agreement is needed whenever a business, company, or individual wishes to purchase specific assets from another business or individual in New Zealand. The following circumstances commonly require a formal Asset Purchase Agreement.
Business acquisition (asset deal): When a purchaser wishes to acquire a business without taking on the vendor's historical liabilities, an asset purchase is the preferred structure. This is particularly common where the vendor's company has unknown tax liabilities, employment disputes, or other contingent obligations that the purchaser does not wish to assume.
Division or partial sale: When a company wishes to sell a division, business unit, or product line (but not the entire business or company), an asset purchase agreement allows it to sell the specific assets associated with that division while retaining the rest of the company.
Distressed or insolvency sales: Receivers, liquidators, and voluntary administrators in New Zealand commonly sell business assets under asset purchase agreements as part of realising value from an insolvent estate. These transactions are often conducted under the Companies Act 1993 or the Receiverships Act 1993.
Going concern acquisitions: When a purchaser wants to acquire a business as a going concern (including staff, contracts, and all necessary assets to continue operating), an asset purchase agreement should include specific provisions for GST zero-rating, employee transfer under the ERA 2000, and the assignment of key customer and supplier contracts.
Intellectual property transfers: When a company is transferring a specific brand, patent, copyright, or other intellectual property asset (with or without the underlying business), a dedicated asset purchase agreement can provide appropriate warranty and assignment provisions.
Property and equipment acquisitions: When a company is purchasing specific plant, equipment, vehicles, or other moveable assets from another business, an asset purchase agreement provides the legal framework for the transfer of title and any applicable warranties as to condition.
What to Include in Your Asset Purchase Agreement (New Zealand)
A thorough New Zealand Asset Purchase Agreement should address the following key elements.
Identification of assets: The agreement must clearly identify all assets being transferred — tangible assets (plant, equipment, stock, vehicles), intangible assets (goodwill, intellectual property, domain names, trade secrets), and contractual rights (customer contracts, supplier agreements). Excluded assets retained by the vendor must be expressly listed. Where assets are registered on the Personal Property Securities Register (PPSR) under the Personal Property Securities Act 1999, the vendor must discharge any security interests before or at settlement.
Assumed liabilities: The agreement must expressly state which liabilities the purchaser assumes. An asset purchase does not automatically transfer liabilities. Attention should be paid to employee entitlements (holiday pay, sick leave accrued under the Holidays Act 2003), GST obligations to Inland Revenue (IRD), and any PPSR-registered creditors.
Purchase price and GST: The purchase price must be specified together with the GST treatment. Where the transaction is a going concern zero-rated supply under section 11(1)(m) of the Goods and Services Tax Act 1985, both parties must be GST-registered and the agreement must state that the supply is a going concern. The Inland Revenue Department (IRD) requires allocation of the purchase price between asset classes (trading stock, depreciable property, goodwill) for tax purposes using the method prescribed by the Income Tax Act 2007.
Conditions precedent: Common conditions in New Zealand asset purchases include: satisfactory due diligence; landlord consent to lease assignment; Commerce Commission clearance under section 66 of the Commerce Act 1986 (for transactions that may substantially lessen competition); and Overseas Investment Office (OIO) consent under the Overseas Investment Act 2005 where overseas persons are acquiring sensitive New Zealand assets.
Employee transfer: Sections 69I to 69OA of the Employment Relations Act 2000 govern employee rights on restructuring. Affected employees have the right to transfer to the purchaser on the same or no less favourable terms. The vendor must notify affected employees and the Employment Relations Authority (ERA) has jurisdiction over disputes.
Restraint of trade: A restraint prevents the vendor competing with the acquired business for a defined period and area. New Zealand courts, applying principles from Dymocks Franchise Systems v Todd [2002] NZLR 685 and related High Court decisions, will enforce restraints that protect a legitimate interest and are reasonable in scope, duration, and geography.
Vendor warranties: The agreement should include warranties from the vendor as to title (free from encumbrances), asset condition, compliance with laws including the Health and Safety at Work Act 2015 and Fair Trading Act 1986, financial position, and absence of undisclosed liabilities. Warranty liability is typically capped, time-limited, and subject to a disclosure letter.
Governing law: The agreement is governed by the laws of New Zealand, including the Contract and Commercial Law Act 2017, with disputes subject to the jurisdiction of the High Court of New Zealand or, for smaller claims, the District Court. The forms-legal.com Asset Purchase Agreement (New Zealand) provides a ready-to-use template that meets all of these requirements.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Asset Purchase Agreement (New Zealand) (New Zealand) [Legal document template]. Forms Legal. https://forms-legal.com/new-zealand/business/corporate/asset-purchase-agreement-new-zealand
"Asset Purchase Agreement (New Zealand) (New Zealand)." Forms Legal, 2026, https://forms-legal.com/new-zealand/business/corporate/asset-purchase-agreement-new-zealand.
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year = {2026},
howpublished = {\url{https://forms-legal.com/new-zealand/business/corporate/asset-purchase-agreement-new-zealand}},
note = {Free legal document template. Based on Companies Act 1993}
}Also available for these jurisdictions:
Frequently Asked Questions
In an asset purchase, the purchaser acquires specific identified assets of the business (such as plant, equipment, stock, goodwill, intellectual property, and customer lists) without acquiring the shares of the company that owns those assets. This means the purchaser does not automatically inherit the vendor company's historical liabilities, tax debts, or contingent obligations. In a share purchase, the purchaser acquires the shares of the company itself, taking on all of the company's assets and liabilities (both known and unknown). The key advantage of an asset purchase for the purchaser is that it allows them to cherry-pick the assets they want and leave behind any liabilities they do not want to assume. The key advantage for the vendor of a share purchase is that all capital gain on the company's shares is generally not subject to income tax in New Zealand (as New Zealand does not have a general capital gains tax), whereas the asset sale proceeds may be taxable to the extent they relate to depreciable assets or trading stock. The choice between an asset and share sale is a significant commercial and tax decision and should be made with the assistance of a New Zealand lawyer and chartered accountant.
The sale of business assets in New Zealand is generally subject to GST at 15% under the Goods and Services Tax Act 1985. However, if the transaction constitutes a 'supply of a going concern', it may be zero-rated (charged at 0% GST) under section 11(1)(m) of the GST Act. For the going concern zero-rating to apply, all of the following conditions must be met: (1) both the vendor and purchaser must be registered for GST; (2) the supply must be of an ongoing business or a part of it that is capable of being operated independently; (3) the vendor must supply the purchaser with all of the assets necessary to carry on the taxable activity being transferred; and (4) the parties must agree in writing in the sale and purchase agreement that the supply is a going concern. If the transaction is not zero-rated, the vendor must charge GST at 15% on the purchase price (unless specific assets such as residential land are GST-exempt). The GST treatment of individual asset classes may differ, and the parties should allocate the purchase price between asset classes in the agreement to establish the GST treatment of each component. Tax advice from a New Zealand chartered accountant is strongly recommended before finalising the GST treatment of any asset sale.
Under section 69I of the Employment Relations Act 2000 (ERA 2000), where a business or part of a business is sold and the work performed by employees is to continue within the purchaser's business (a 'restructuring'), affected employees have the right to transfer to the purchaser on the same or no less favourable terms and conditions of employment. This is sometimes called the 'continuity of employment' or 'transmission of business' provision. In practice, the vendor must notify affected employees of the proposed restructuring and their right to be consulted, and the purchaser must offer to employ the affected employees on their existing terms. Employees are not compelled to transfer to the purchaser — they may choose to remain with the vendor (where available), or they may negotiate a redundancy package. The transfer of employees in an asset sale requires careful planning to comply with the ERA 2000, the Employment Relations (Flexible Working Arrangements) Act 2007, and any applicable collective agreements. The vendor also remains responsible for all outstanding employee entitlements (holiday pay, sick leave, etc.) up to the completion date unless the purchaser expressly agrees to assume these liabilities.
A going concern is a business that is operating and capable of continuing to operate after the sale with all necessary assets, staff, and systems in place. The concept of a going concern is important in New Zealand asset purchase transactions for two main reasons. First, it determines whether the transaction qualifies for zero-rating under the Goods and Services Tax Act 1985, which can represent a significant cash flow benefit to the purchaser (avoiding the need to fund a 15% GST payment on a large purchase price). Second, it is relevant to the Employment Relations Act 2000, which provides special protections for employees where a business is sold as a going concern (see the previous FAQ about employee transfers). For a transaction to qualify as a zero-rated going concern under section 11(1)(m) of the GST Act, the purchaser must acquire all of the assets necessary to continue to carry on the taxable activity being transferred. This means the purchaser generally cannot cherry-pick individual assets and still claim the going concern zero-rating — the essential infrastructure of the business must transfer. The parties should document their agreement that the sale is a supply of a going concern in the Asset Purchase Agreement, and both parties must be registered for GST at the time of the transaction.
In a New Zealand asset purchase, the purchaser should seek thorough warranties from the vendor to protect against undisclosed liabilities, defects in assets, and other risks. Key warranties include: (1) title — the vendor warrants that it holds clear legal and beneficial title to all assets being transferred, free from encumbrances; (2) asset condition — the assets are in good working order and condition; (3) compliance — the business has been conducted in compliance with all applicable laws, including the Commerce Act 1986, the Fair Trading Act 1986, the Health and Safety at Work Act 2015, and applicable employment legislation; (4) financial — the vendor's most recent financial statements fairly represent the financial position of the business and all liabilities have been disclosed; (5) contracts — all material contracts assigned under the agreement are valid, enforceable, and subsisting; (6) employees — all employee entitlements have been properly accrued and there are no outstanding personal grievance claims under the Employment Relations Act 2000; (7) intellectual property — the vendor has the right to use and transfer all intellectual property being sold; and (8) tax — all tax obligations have been met. The vendor will typically seek to limit liability under warranties through disclosure (in a disclosure letter), minimum claim thresholds, time limits for claims, and a cap on total warranty liability equal to the purchase price.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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