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Venture Capital Fund Act 2019

Directions for winding up VCF

32: Process for directions for winding up

You could also call this:

"How the Minister decides to close the Venture Capital Fund"

Illustration for Venture Capital Fund Act 2019

The Minister can give a direction to wind up the Venture Capital Fund (VCF) only if some conditions are met. You need to know that the Minister must get a report on how much venture capital would be available to New Zealand businesses if the VCF were wound up. The Minister also needs to think about whether New Zealand's venture capital markets would work well if the VCF were wound up. The Minister must look at the report, talk to the Guardians, and be happy that the markets would work well. The Minister must also try to agree with the Guardians on a plan to sell the VCF's investments, which is called a divestment programme. The Minister can give directions on how long the divestment programme should take. When making this plan, the Minister and the Guardians must think about how to get the best returns from selling the investments. You should understand that the venture capital markets are likely to function effectively if there is enough venture capital for New Zealand businesses to grow and succeed.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS211002.

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31: Minister may give directions for winding up, or

"The Minister can give instructions on how to close the Venture Capital Fund."

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33: Amendment or replacement of policy statement or directions, or

"Changing or Replacing Rules or Guidelines"

32Process for directions for winding up

  1. The Minister may give a direction under section 31 only if—

  2. a person or persons (including any department) appointed by the Minister has prepared a report on—
    1. the amount of venture capital available to New Zealand entities if the VCF or part of the VCF were to be wound up; and
      1. whether, if the VCF or part of the VCF were to be wound up, New Zealand’s venture capital markets would be likely to function effectively; and
      2. the Minister has taken the report into account; and
        1. the Minister has consulted the Guardians; and
          1. the Minister is satisfied that, if the VCF or part of the VCF were to be wound up, New Zealand’s venture capital markets would be likely to function effectively; and
            1. the Minister has made reasonable efforts to agree with the Guardians on a programme for the realisation of the investments of the VCF or part of the VCF (a divestment programme).

              1. The Minister may, after subsection (1)(a) to (d) has been satisfied, give directions to the Guardians relating to the Government’s expectations as to the time frame for the divestment programme.

              2. When making efforts to agree on a divestment programme,—

              3. the Minister must have regard to the desirability of divesting the investments of the VCF over a time period that is most likely to maximise returns; and
                1. the Guardians must have regard to—
                  1. any directions under subsection (2); and
                    1. the desirability of divesting the investments of the VCF over a time period that is most likely to maximise returns.

                    2. In this section, New Zealand’s venture capital markets would be likely to function effectively if adequate venture capital were available to New Zealand entities to enable them to grow into successful and sustainable businesses.