Dated at Wellington this 24th day of September 2012.
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 (Unit Trust Certificates) Exemption Notice 2002 (the 2002 notice).
The notice exempts, subject to conditions, issuers who in the ordinary course of their business continuously offer units in a unit trust to the public from the provision of the Securities Act 1978 relating to the issue of certificates evidencing securities.
The provisions of the 2002 notice have been carried forward with little change of substance. However, changes have been made to allow issuers to send a notice that makes information about the units of a unit holder available by electronic means.
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—
the exemption in the 2002 notice from the securities certificate requirements recognises the significant cost of, and unhelpful information provided by, the regular receipt of securities certificates in the case of securities issued on a continuous basis. In these circumstances, periodic consolidated statements are both more cost effective and more informative:
the exemption has been in place for a number of years and the policy reasons for it remain valid and relevant. While the changes introduced by the Securities Regulations 2009 have reduced costs of issuers, and improved information for investors, they have not attempted to tailor disclosure and conduct requirements to the extensive range of circumstances to which securities law requirements apply. Accordingly, the exemption continues to be required and remains appropriate in light of the policy of the 2002 notice and is continued in this notice on substantially the same basis:
the change to enable delivery of securities confirmation information by notice to the investors of where this information can be accessed on the Internet recognises the increased use by issuers and investors of Internet-based communications:
given the limited application of the notice to granting relief only to continuous issuers from the securities certificate requirement, and the conditions imposing alternative workable obligations that meet subscribers’ need to have up-to-date information about their securities holdings, the Financial Markets Authority considers that the exemption will not cause significant detriment to subscribers and that the exemption is not broader than is reasonably necessary to address the matters that gave rise to the exemption.
Date of notification in Gazette: 27 September 2012.
This notice is administered by the Financial Markets Authority.