US billionaire Peter Thiel demonstrated his commitment to New Zealand by investing in companies and making high-profile financial contributions before being granted citizenship, the prime minister says.
Immigration New Zealand (INZ) area manager Darren Calder confirmed to Newshub that Mr Theil was granted residence in 2006 under the Investor category.
After satisfying the conditions of his visa was granted permanent residence in 2009.
It was revealed this week he purchased another New Zealand property, a lakefront estate at Wanaka in 2015 and the sale did not require Overseas Investment Office approval because he a New Zealand citizen.
Bill English has denied assertions that citizenship is for sale, saying on Thursday there had to be a balance between fairness and encouraging people who make positive differences to the nation.
"If people come here and invest and get into philanthropy and are supportive of New Zealand, then we're better off for their interest in our country," he told reporters in Christchurch.
"And as a small country at the end of the world, that's not a bad thing."
Mr Thiel, who was also one of the fist investors in Facebook, has invested in Xero and the New Zealand Venture Investment Fund and made a $1 million donation to the Christchurch earthquake appeal fund.
Up to 300 citizenship applications a year are passed on to the internal affairs minister for consideration where a person doesn't fit the criteria or there is an overriding public interest in approving applications, Mr English said.
Nathan Guy, who was minister at the time, says while he recall the specific application he has been advised he "officials recommended granting citizenship in this particular case".
Rather than meeting the requirements that a person must live in New Zealand for at least 70 per cent of the five years preceding their application, it's understood citizenship was granted because it was either in the public interest or because of exceptional circumstances of humanitarian or other nature.
Labour MP Iain Lees-Galloway has questioned what both New Zealand and Mr Thiel have to gain from citizenship that wouldn't be achieved by permanent residency, which he gained in 2006.
"It's not unreasonable to think that a reason might be that it's easier to purchase sensitive land without making an application to the Overseas Investment Office," he said.
He admitted there was no evidence of impropriety but said New Zealanders pride themselves on being an egalitarian nation where citizenship is not for sale, an idea that must be upheld.
Mr Lees-Galloway has submitted formal questions to current internal affairs minister Peter Dunne including asking for details of the evidence considered in Mr Thiel's application.
The 49-year-old has not commented on his dual citizenship since the news broke.
This week Mr Thiel, a prominent supporter of US President Donald Trump, has been rumoured to be considering a political run of his own, seeking to become governor of California.
There's also speculation he is being considered as an ambassador to Germany.