Dated at Auckland this 16th day of November 2016.
Statement of reasons
This notice comes into force on 18 November 2016 and is revoked on the close of 17 November 2021.
The notice exempts issuers from the disclosure and governance requirements in Parts 3 and 4 of the Financial Markets Conduct Act 2013 (the Act) in relation to the following offers:
offers of financial products that are or will be listed on an overseas market (overseas listed products) where the offers are made to existing holders of the issuer’s financial products:
offers of overseas listed products where, for example, the financial products are offered as the consideration for the acquisition or cancellation of any other overseas listed products:
offers of interim financial products that are offered as all or part of the consideration for the acquisition or cancellation of any overseas listed products or are offered to holders of overseas listed products in another issuer under an arrangement that results in a capital reduction of that issuer.
This notice also exempts issuers from disclosure requirements in clauses 33 to 35 of Schedule 8 of the Financial Markets Conduct Regulations 2014 for offers of variations of overseas listed products.
The notice also provides that the offers exempted by this notice are not regulated offers under the Act. This means that other requirements of the Act, or other Acts, that apply in connection with regulated offers (such as the financial reporting requirements) do not apply. Any other financial market conduct obligations that the exempted issuer may have, including obligations under Part 2 of the Act, are not affected.
The Financial Markets Authority (the FMA), after satisfying itself as to the matters set out in section 557 of the Act, considers it appropriate to grant the exemptions because—
this notice applies only to offers made to people who already hold financial products listed on exchanges in jurisdictions with a level of regulation broadly comparable to New Zealand and who can be taken to have assumed the degree of risk that might accompany overseas investment. This notice cannot be used for an offer of financial products to New Zealand investors more generally. The notice allows New Zealanders who hold financial products on recognised overseas markets to participate in rights offers and offers arising from reconstructions that might otherwise not be extended to shareholders in this country due to the cost of compliance:
the exemptions recognise the adequacy of the regulation of financial product offerings in certain overseas jurisdictions. The regulations in those jurisdictions have the following characteristics:
the laws of the jurisdiction require disclosure of information for investors to an extent broadly equivalent with New Zealand financial markets conduct law:
the overseas issuer is subject to financial reporting (including overseas generally accepted accounting practice or principles) and audit standards that are broadly comparable to New Zealand:
the regulatory body in the jurisdiction is an ordinary member of the International Organization of Securities Commissions (IOSCO) and a signatory to the IOSCO Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information. This means that the FMA will be able to obtain co-operation from the securities regulator in the jurisdiction if any compliance concerns arise in relation to the issuer:
as such, the FMA is satisfied that the granting of the exemptions is desirable in order to promote the purposes of the Act; specifically, it will avoid unnecessary compliance costs and promote flexibility in the financial markets:
given that the exemptions will be limited to exempt issuers subject to regulatory oversight broadly equivalent to New Zealand and making offers that only incidentally target New Zealand investors, the FMA is satisfied that the exemptions are not broader than is reasonably necessary to address the matters that gave rise to them.
Date of notification in Gazette: 17 November 2016.
This notice is administered by the Financial Markets Authority.