Post-Settlement Governance Entity

Many iwi have concluded their Treaty of Waitangi settlements but a number are still in the process of doing so.  Establishment of a Post-Settlement Governance Entity (PSGE) is an integral step in the settlement journey and important for the future success of iwi claimant groups.

What is a Post-Settlement Governance Entity?

A PSGE is the entity that receives and manages the settlement assets on behalf of the iwi claimant group.  Establishing a PSGE is required for settlement; the Crown will not complete settlement until a PSGE is established and ratified by the claimant group.

Key Requirements

Although a PSGE is designed by an iwi group to suit the iwi and their wider context, the Crown must approve the final PSGE to ensure, from its perspective, that the settlement redress is going to be held for the right people and in a responsible way.  There is a set of key Crown requirements that a PSGE must satisfy. A PSGE must be:          

• Representative of the iwi/claimant group
• Transparent in its decision-making and dispute resolution procedures
• Accountable to the iwi/claimant group
• For the benefit of the members of the iwi/claimant group
• Ratified by the iwi/claimant group

Start Discussions Early

Generally the main focus during settlement negotiations is achieving an Agreement in Principle followed by a Deed of Settlement.  However, given the significance of the PSGE and the Crown process to approve and ratify the proposed PSGE, we advise that iwi should start discussions early during the negotiation process as to what would be the most suitable PSGE to represent iwi members post-settlement.

Early discussions about the PSGE are important for the following reasons:

• Keeping iwi members informed so that they are part of shaping the PSGE to reflect their reality, and that iwi members understand and accept the proposed PSGE. Early involvement and hui with iwi members increases the likelihood that the claimant group will buy into, accept and ratify the final PSGE proposal.
• Gaining Crown acceptance; practically this means working with the Crown at an early stage in the development of the PSGE. This is important in gaining the Crown’s final acceptance of the proposed PSGE. It also provides time to work through any bespoke arrangements to ensure the proposed PSGE model can be achieved. 

PSGE Structures

The most common form of PSGE is a private trust that is governed by a trust deed.  The trustees are generally members of the claimant group, and the initial trustees will be appointed/elected at the same time the PSGE is established.  While a private trust is recommended as the PSGE itself, other potential structures will inevitably form part of the wider post settlement governance structure to hold commercial assets and/or manage charitable functions.Within the Crown framework, there is more than one way to structure a PSGE and it is not a ‘one-size fits all’ exercise.  Our team can assist iwi/claimant groups in working through a variety of issues pragmatically and in context, to ensure that a PSGE will best serve its members in the future.

Katia is a Senior Solicitor in our Commercial Team and can be contacted on 07 958 7443.