Dated at Wellington this 9th day of July 2012.
Head of Primary Regulatory Operations.
Statement of reasons
This notice, which comes into force on the day after the date of its notification in the Gazette and expires on 30 November 2016, exempts managers of KiwiSaver schemes and employers that enter into participation agreements in respect of those schemes from various provisions of the Securities Act 1978 (the Act) and the Securities Regulations 2009 (the 2009 regulations).
The exemptions are similar to exemptions in the Securities Act (Multiple Participants Superannuation Schemes) Exemption Notice 2011.
The notice includes exemptions from—
section 41(1)(b)(ii) of the Act. This provision requires the prospectus to be signed by the promoters (which may include employer participants and directors of employer participants):
regulation 21 of the 2009 regulations (which requires matters in the investment statement to be set out under particular questions):
various requirements in Schedule 5A of the 2009 regulations (which relate to the content of a prospectus for a KiwiSaver scheme). The exemptions mainly relate to information that would otherwise be required to be disclosed about employer participants and directors of employer participants (as promoters) and participation agreements entered into by those participants:
clause 3(6) of Schedule 13 of the 2009 regulations (which requires the investment statement to specify the names and addresses of employer participants and directors of employer participants as promoters).
The Financial Markets Authority, after satisfying itself of the matters set out in section 70B(2) of the Act, considers it appropriate to grant the exemptions set out in this notice for the following reasons:
employers who provide branded KiwiSaver schemes may be promoters as defined in the Act. If so, those participants and their directors would need to sign and include their details in the prospectus. This is likely to be impractical for schemes with numerous participants and involve significant compliance costs:
the exemptions recognise that KiwiSaver schemes are subject to a high degree of legislative prescription. There is limited scope for employers to modify the benefits or requirements of a particular scheme. There is, accordingly, limited information about the employer, or the agreement under which the employer has signed up for the scheme, that is relevant to subscribers. The notice provides for the limited information that remains relevant specifically about a particular participating employer to instead be included in a supplement to the investment statement. This provides for each investor to receive information that is relevant to their investment decision without having to review information relating to other participants in the scheme, which might be confusing:
in light of the prescriptive nature of disclosure for KiwiSaver schemes, and the conditions of the notice requiring alternative disclosures in a supplementary investment statement, the Financial Markets Authority considers that the exemptions will not cause significant detriment to subscribers, and that the exemptions are not broader than reasonably necessary to address the matters that gave rise to the exemptions.
Date of notification in Gazette: 12 July 2012.
This notice is administered by the Financial Markets Authority.