One of the Flag Consideration Panel members who helped to pick the final four options sits on a government board where her job is to help promote the Fern Mark logo.
Julie Christie is an advisory board member on New Zealand Story, a NZ Trade and Enterprise body which approves the use of the Fern Mark image used on the black-and-white version of the final four flag options.
She declared a conflict of interest at the same meeting at which the flag panel was told the NZ Story board had cleared the path for the Fern Mark to be used on a new flag.
The details are revealed in papers released under the Official Information Act and have led to the revelation former National Party campaign director Grant McLachlan, who is fronting a competing entry, Black and Silver, has sought legal advice which could halt the referenda.
The OIA papers show Ms Christie declared two conflicts of interest at a July 30 meeting of the flag panel. She declared her link to the Fern Mark and as a member of the commercial committee of the NZ Rugby Union.
The minutes said "the panel noted these conflicts of interest as minor".
They also show the board of NZ Story - to which Ms Christie was appointed by Economic Development Minister Steven Joyce in November 2013 - had discussed the NZ Trade and Enterprise logo and "had formally agreed to support the use of the NZ Way Fern Mark in any flag design". The NZRU had ruled out a similar arrangement.
The papers show Saatchi boss Nicky Bell also declared a conflict but officials withheld the details.
The declarations came after flag submissions closed in mid-July but before the "longlist" of 40 flags was revealed in August. The list included a number of Fern Mark ferns.
Ms Christie referred questions last night to the secretariat of the Flag Consideration Panel for a response.
A spokeswoman for the panel said: "Ms Christie excluded herself from any discussions in relation to designs that included those particular ferns." She said the conflict had also been raised earlier. She said Ms Bell's conflict had nothing to do with NZTE but because she "has occasion to meet and work with professional designers".
Any conflict was managed properly, the panel spokeswoman said.
A spokeswoman for Mr Joyce said he had "no concern" about Ms Christie being on the NZ Story board and selecting fern flags. He said he was not consulted before the NZ Story board told the flag panel it could use the logo.
Mr McLachlan said he had sought legal advice on having the process reviewed by the courts, based on conflicts of interest and the panel not seeking proper expert advice.
Ms Christie should never have been appointed to the panel, Mr McLachlan said. "That's more than a minor conflict of interest."
Labour's Jacinda Ardern said she had concerns about the quality of advice the panel had had and the way at which the "longlist" was reached.
The fern on Mr McLachlan's flag was based on the fern on the original All Black jersey from 1908.
For Grant McLachlan's opinion, see http://tinyurl.com/nzhflagviews