Mr Key said the minister informed him on April 1 about the charges and offered to stand down.
The Prime Minister sought advice from the Cabinet Office as to whether a conflict of interest existed.
He said "further, deeper advice" was sought by the Cabinet Office and that advice confirmed there was no conflict of interest.
He would not say where the further advice came from but it could have been from the Solicitor General, a QC, an academic or another specialist in such matters. "I am quite confident the position is correctly assessed and thorough," Mr Key said.
The minister's brother is due to appear in court today.
The accused's lawyer, Jonathan Eaton, QC, successfully sought an injunction against Fairfax on Saturday preventing the Sunday Star Times from naming his client or the minister.
Labour leader Andrew Little said if the public thought there was a conflict of interest, then the Prime Minister should act accordingly.
"If a family member is embroiled in an issue which may be seen by the public as conflict of interest, the Prime Minister must take every action required as soon as possible."
Mr Little compared it to the case of former MP Mike Sabin being kept on as chairman of the law and order select committee last December even after Mr Key found out he was the subject of a police investigation.
- NZ Herald
