US billionaire investor Peter Thiel's decision to invest $15 million in a Crown-owned venture fund had nothing to do with him gaining New Zealand citizenship, the fund says.
PayPal co-founder Peter Thiel - pictured at last year's Republican National Convention Photo: AFP
The New Zealand Herald revealed this week that Mr Thiel - a donor to Donald Trump's election campaign - has been a New Zealand citizen since June 2011, prompting questions over whether he spent the required amount of time living here.
Normally a permanent resident has to spend more than 70 percent of their time in New Zealand over five years before they can apply for citizenship.
Nathan Guy, who was Internal Affairs Minister at the time, told RNZ that Mr Thiel was granted citizenship under a provision of the Citizenship Act stating it would be "in the public interest due to exceptional circumstances of a humanitarian or other nature", even if the person did not meet normal criteria.
Mr Thiel has sunk millions of dollars into New Zealand companies, including accounting software start-up Xero, before and after being granted citizenship.
That included $15m he put into a partnership between his New Zealand-based company Valar Ventures and the New Zealand Venture Investment Fund (NZVIF), which was finalised in December 2011 - a few months after he gained citizenship - and publicly announced in March 2012.
He also donated $1m to the Christchurch earthquake appeal fund in April 2011 - a gesture then-Prime Minister John Key labelled "very generous" in a parliamentary debate in 2013.
In a written statement, an NZVIF spokesman said the partnership with Valar Ventures was "the result of discussions, negotiations and due diligence over quite a few months through 2011".
"We don't normally comment on the commercial negotiations we have with any of our investment partners as these are subject to confidentiality agreements, but citizenship was not a factor and was never discussed," the spokesman said.
Finance Minister Steven Joyce was Economic Development Minister at the time the partnership was announced.
When asked today if Mr Thiel's investment had been contingent on his having New Zealand citizenship, a spokeswoman for Mr Joyce said: "No."
Specialist immigration lawyer Simon Laurent said the "exceptional circumstances" clause that Mr Thiel had been granted citizenship under was very rarely used.
Mr Laurent had had little success with it himself - even when representing Somalian refugees who were effectively stateless, he said.
"They were refused that on the basis that their situation was not compelling enough to justify the grant of citizenship."
He expected Mr Thiel was granted the exception under the "other nature" category, rather than for humanitarian reasons - and that could include his substantial financial investments in New Zealand.
"The grounds for granting citizenship in this provision are deliberately broad and it could well be that financial contribution or some other kind of strategic contribution might also have been a significant enough factor."
Mr Laurent had no objection to someone getting granted citizenship if they were an "upstanding" person, he said.
"But I feel that if one is going to be generous on one side, perhaps there should be generosity to others whose situation may call out for a remedy, yet don't have the money or the connections to sway those in power."
The Department of Internal Affairs has so far not said why Mr Thiel was granted the exception, saying it would consider releasing details under the Official Information Act.
Current Minister of Internal Affairs Peter Dunne said he had not seen the case notes and knew very little about the matter.
Timeline
- 9 March, 2001 - A home in Auckland's affluent suburb of Parnell, 6 Alberon Place, is bought for $465,000. The home is listed as the registered address for two companies that Mr Thiel is a shareholder of.
- New Zealand-based company Second Star - of which Mr Thiel is the sole shareholder - is registered.
- 24 March, 2010 - 6 Alberon Place is sold for $2.5m by Second Star. Neighbours say they saw Mr Thiel "two or three times" in nine years.
- 22 October, 2010 - Mr Thiel invests $4m into accounting software company Xero - the first investment by his New Zealand-based company, Valar Ventures. Valar makes further multi-million-dollar investments in Xero in 2012.
- 12 January, 2011 - Mr Thiel invests an undisclosed amount in Pacific Fibre, the company behind an ultimately failed plan to build a second trans-Pacific fibre optic cable.
- 20 April, 2011 - Mr Thiel donates $1m to the Christchurch earthquake appeal fund.
- 30 June, 2011 - Department of Internal Affairs approves Mr Thiel's application for New Zealand citizenship, under a provision of the Citizenship Act stating it would be "in the public interest due to exceptional circumstances of a humanitarian or other nature".
- 20 December, 2011 - NZVIF (Valar) Ltd, a partnership between the New Zealand Venture Investment Fund and Valar Ventures, is incorporated under the Companies Act.
- 22 March, 2012 - The NZVIF-Valar partnership is publicly announced, with Mr Thiel contributing $15m to a total pool of $40m.
- 12 June, 2013 - Then-Prime Minister John Key responds to questions in Parliament about Mr Thiel, saying he had met Mr Thiel on "a few occasions" and their relationship was cordial. Mr Thiel was "extremely generous" after the Christchurch earthquakes, Mr Key said.
- 2015 - Mr Thiel purchases land in Wanaka. Due to his citizenship status, it does not require Overseas Investment Office approval.
- October 2016 - Mr Thiel donates $NZ1.7m to Donald Trump's presidential campaign.
- 25 January, 2017 - After The New Zealand Herald reveals Mr Thiel's citizenship, the Department of Internal Affairs confirms the date it was granted.