Securities Act (Brokers) Exemption Notice 2012


Coat of Arms of New Zealand

Securities Act (Brokers) Exemption Notice 2012

Pursuant to section 70B of the Securities Act 1978, the Financial Markets Authority gives the following notice (to which is appended a statement of reasons of the Financial Markets Authority).


1 Title
  • This notice is the Securities Act (Brokers) Exemption Notice 2012.

2 Commencement
  • This notice comes into force on 1 October 2012.

3 Expiry
  • This notice expires on the close of 30 September 2017.

4 Interpretation
  • (1) In this notice, unless the context otherwise requires,—

    Act means the Securities Act 1978

    broker has the same meaning as in section 77A of the Financial Advisers Act 2008

    Regulations means the Securities Regulations 2009.

    (2) Any term or expression that is defined in the Act or the Regulations and used, but not defined, in this notice has the same meaning as in the Act or the Regulations.

3 Issuers exempted from regulation 30 of Regulations
  • Every issuer and every person acting on its behalf are exempted from regulation 30 of the Regulations in respect of any advertisement distributed by a broker on behalf of that issuer.

Dated at Wellington this 24th day of September 2012.

Sue Brown,
Head of Primary Regulatory Operations.

Statement of reasons

This notice, which comes into force on 1 October 2012 and expires on 30 September 2017, replaces the Securities Act (Sharebrokers) Exemption Notice 1984 (the 1984 notice).

This notice exempts an issuer from regulation 30 of the Securities Regulations 2009 in respect of advertisements distributed on its behalf by a broker. Regulation 30 requires a certificate in relation to an advertisement.

The provisions of the 1984 notice have been carried forward with little change of substance. However, changes have been made to—

The Financial Markets Authority, after satisfying itself as to the matters set out in section 70B(2) of the Securities Act 1978, considers it appropriate to grant the exemption because,—

  • where a broker underwrites or is otherwise associated with the issue or the issuer, an offer of securities that is made in a broker’s letter may be an advertisement (as defined in the Securities Act 1978). Accordingly, without an exemption, any such letter could not be distributed without prior submission to the issuer for review and the completion of an advertisement certificate. In providing relief from this requirement, the 1984 notice recognised that this is an impractical impediment to brokers communicating with their clients and the responsibilities brokers already have in relation to their clients:

  • despite minor changes introduced by the Securities Regulations 2009 to advertising requirements, without an exemption, a certificate would still be required in these circumstances. Accordingly, this exemption continues to be required and remains appropriate in light of the policy of the notice:

  • changes made in this notice also recognise the repeal of the Sharebrokers Act 1908 and the alternative relevance of the Financial Advisers Act 2008:

  • given the limited application of the notice to advertisements distributed by brokers on behalf of an issuer, and the obligations imposed on brokers to their clients, the Financial Markets Authority considers that the exemption is not broader than is reasonably necessary to address the matters that gave rise to the exemption and will not cause significant detriment to subscribers.

Issued under the authority of the Acts and Regulations Publication Act 1989.

Date of notification in Gazette: 27 September 2012.

This notice is administered by the Financial Markets Authority.