Schedule 9 Council-controlled organisations and transfer of undertakings

s 73

1 Transfer of leases, licences, etc, to council-controlled organisations

(1)

Despite anything in any enactment or rule of law, property that is fixed to, or under or over, any land may be transferred under this Act by a local authority to a council-controlled organisation in which it holds equity securities, whether or not any interest in the land is also transferred.

(2)

If any such property is so transferred, the property and the land must be regarded as separate property, each capable of separate ownership.

Compare: 1974 No 66 s 594ZE(2)

2 Modification of provisions of Public Works Act 1981

(1)

Nothing in sections 40 to 42 of the Public Works Act 1981 applies to the transfer of land to a council-controlled organisation under this Act.

(2)

However, after the transfer, sections 40 and 41 of that Act apply to that land as if the council-controlled organisation were a local authority and the land had not been transferred under this Act.

Compare: 1974 No 66 s 594ZF

3 Obligation to lodge caveat

(1)

The rights of persons from whom land was acquired and their successors to have land offered to them under section 40(2) of the Public Works Act 1981 are deemed interests in land for the purposes of section 138 of the Land Transfer Act 2017, and the local authority that transfers the land to a council-controlled organisation under this Act must lodge an appropriate caveat.

(2)

In stating the interest claimed by the caveator in a caveat lodged under subclause (1), it is sufficient to refer to sections 40 to 42 of the Public Works Act 1981 and to this clause.

Compare: 1974 No 66 s 594ZG

Schedule 9 clause 3(1): amended, on 12 November 2018, by section 250 of the Land Transfer Act 2017 (2017 No 30).

Schedule 9 clause 3(2): amended, on 12 November 2018, by section 250 of the Land Transfer Act 2017 (2017 No 30).

4 Transfer of liabilities in relation to undertakings

(1)

A local authority may transfer its liabilities in relation to an undertaking to a council-controlled organisation if the transfer is agreed to by—

(a)

the local authority; and

(b)

the council-controlled organisation; and

(c)

any other affected parties.

(2)

If an agreement is reached, the council-controlled organisation assumes the liabilities in relation to the undertaking as if it had entered into the contract or agreement that gave rise to the undertaking.

(3)

If an agreement cannot be reached, the liabilities in relation to the undertaking remain with the local authority.

Compare: 1974 No 66 ss 594ZI, 594ZK

5 Certain matters not affected by transfer of liabilities in relation to undertakings

A transfer of liabilities in relation to an undertaking from a local authority to a council-controlled organisation—

(a)

does not constitute a breach of contract or agreement, or a civil wrong; and

(b)

does not abrogate the right of any person to cancel or amend any contract or agreement pertaining to the undertaking; and

(c)

does not release any surety or guarantor from any obligation with respect to the undertaking.

Compare: 1974 No 66 s 594ZJ

6 Application of Income Tax Act 2007 and Goods and Services Tax Act 1985

(1)

Nothing in sections CB 6 to CB 23 of the Income Tax Act 2007 applies to any land or asset disposed of by the local authority to a council-controlled organisation under this Act.

(2)

For the purposes of sections CB 6 to CB 23 of the Income Tax Act 2007, if any land or asset is acquired by a council-controlled organisation from a local authority, that land or asset is deemed to have been acquired by the council-controlled organisation on the date on which it was acquired by that local authority.

(3)

Nothing in sections EE 40(1) to (3) and EZ 12 of the Income Tax Act 2007 applies to any property acquired by a council-controlled organisation from a local authority under this schedule.

(4)

For the purposes of the Goods and Services Tax Act 1985, a transfer of an undertaking from a local authority to a council-controlled organisation under this schedule is deemed to be a transfer of a part of a taxable activity as a going concern that is capable of separate operation.

Compare: 1974 No 66 s 594ZM

Schedule 9 clause 6 heading: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 9 clause 6(1): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 9 clause 6(2): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 9 clause 6(3): amended (with effect on 1 April 2008), on 7 September 2010 (applies for the 2008–09 and later income years), by section 211(2) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Schedule 9 clause 6(3): amended (with effect on 1 April 2005), on 7 September 2010 (applies for the 2005–06 and later income years), by section 211(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Schedule 9 clause 6(3): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).