Who needs to register as a log trader

What is a log trader?

A log trading business:

• buys logs grown in New Zealand, or
• exports logs grown in New Zealand, or
• processes logs they have grown themselves, or
• acts as an agent for another business doing any of those things.

A log trader can also be a company that transfers ownership of logs grown in New Zealand to or from a related company. The logs can be:

• trees already harvested, or
• trees to be harvested at an agreed time.

A log trading business is also known as a “person in trade”. Log trading businesses can be:

• a sole trader
• a company
• a trust
• a government agency (national or local), or
• another organisation.

Employees that work for a business that is registered as a log trader do not need to register as an individual log trader.

The legislation has the full definition of a log trader.

Forests (Registration of Log Traders and Forest Advisers) Amendment Act 2020 (Section 631) – NZ Legislation

Threshold volume of logs

To register as a log trader, the log trading business must trade at least 2,000 cubic metres of logs each financial year (1 July to 30 June). This is known as the “threshold volume”.

What are log trading activities?

Businesses that buy, export, or process New Zealand logs (or act as an agent) need to register as log traders.

Find out how to register as a log trader

Buying New Zealand logs

A log trading business buys New Zealand logs when it enters a contract to buy or sell New Zealand logs. The contract may be made:

• after harvest, when harvested trees have been cut into logs, or
• before harvest, as trees to be harvested at an agreed time.

They are a log trader from when they agree to buy the logs and for the period the logs are supplied.

What is meant by "agreed time"?

If the contract is made before the harvest, the agreed time for harvest should be specifically rather than generally agreed. A specifically agreed time will identify the month, season, or financial quarter and year that harvest will begin. If this agreed time cannot be met, reasons must be provided why.

Exporting New Zealand logs

A log trading business exports New Zealand logs when they take New Zealand logs out of New Zealand to another country. An exporter includes:

• the owner of the logs, or
• anyone entitled to own the logs, or
• anyone with a beneficial interest in the logs, or
• someone acting as an agent in New Zealand for a buyer who lives overseas permanently.

A log trading business does not need to register if:

• their only log trading activity is shipping or transporting the logs, or logistical activities around this
• they export wood or timber products that are not New Zealand logs.

Processing New Zealand logs a person has grown themselves

A log trading business processes logs they have grown themselves when:

• they own the logs being processed without having to buy them, and
• they modify the logs in some way. For example, they:
  • change the shape of the log, or
  • modify the log on a different site to where it was harvested.

A person does not need to register if they are only doing these things during harvesting:

• on site removal of tops, branches, and limbs
• on site debarking
• cutting stems into log or logs to length
• sorting and loading logs.

Acting as an agent

A business is considered to be a log trader when they act as an agent for another business to:

• buy New Zealand logs
• export New Zealand logs, or
• process New Zealand logs that the business they are acting for has grown themselves.

Companies transferring logs

A company that transfers ownership of New Zealand logs to a related company is a log trader. A company is related to another company if:

• the other company is its holding company or subsidiary, or
• more than half of the issued shares of the company are held by the other company, or
• more than half of the issued shares of each of them are held by members of the other, or
• company business has been conducted in a way that makes it hard to identify what was done by each business, or
• there is another company that both companies are related to.

Read the full definition of a related company in section 2(3) of the Companies Act 1993 – NZ Legislation

Log trader activities that can be done without needing to register

A log trading business does not need to register as a log trader if:

• they trade less than 2,000 cubic metres of logs in a financial year
• their only activity is shipping or transporting logs
• there is an exemption for the class of transactions or transfers of their log trading activity.

When does a person's trade in logs not meet the volume threshold?

The volume threshold is 2,000 cubic metres per year of logs in a financial year. This includes the combined total of all of a person’s log trading activities.

The volume threshold includes logs that change hands or are processed in the financial year. The volume can be:

• the volume at the gate, based on loading documents
• at mill, when logs are weighed for levy payments, or
• at the wharf, when logs are assessed for levy payments.

For example, a person would meet the volume threshold if they:

• buy 1,500 cubic metres of New Zealand logs, and
• process 600 cubic metres of New Zealand logs they have grown themselves.

Exemptions

The Ministry for Primary Industries (MPI) can make log trading activities exempt from registration by creating an exemption for a class of transactions or transfers. Policy decisions have been made that create some classes of exemptions, outlined below. The notice setting out the exemptions will be published soon and come into effect by 6 August 2023.

Final policy decisions to make exemptions from log traders and forestry advisers registration requirements [PDF, 156 KB]

When does a person only ship or transport logs?

A person is not a log trader if their only activity is shipping or transporting logs, or associated logistical activities. These activities include:

• loading and unloading logs at pickup and delivery points
• stevedoring logs
• marshalling logs
• scaling logs
• transporting logs by road, rail, or another method
• being the importer of logs or timber products.

Someone who only ships or transports logs is not considered to be an exporter of New Zealand logs.

Do I need to register as a log trader?

Use this chart to help you decide whether you need to register as a log trader:

The flowchart asks: Do you as a business or sole trader buy logs in New Zealand (including logs already harvested, or to be harvested at an agreed date), export New Zealand logs, process logs you have grown yourself, or do any of these activities on behalf of someone else? If no, you do not need to register as a log trader. If yes, it asks: Do you trade more than 2,000 cubic metres of logs per year? If yes, you need to register as a log trader.

Subscribe to email updates

Get the latest news and updates on the registration system and what you need to do to register.

Subscribe to email updates about the registration of log traders and forestry advisers

Who to contact

For more information about the registration system for log traders and forestry advisers, email forestryregister@mpi.govt.nz