Financial Markets Authority (Levies) Amendment Regulations (No 2) 2017

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2017/211

Coat of Arms of New Zealand

Financial Markets Authority (Levies) Amendment Regulations (No 2) 2017

Patsy Reddy, Governor-General

Order in Council

At Wellington this 7th day of August 2017

Present:
Her Excellency the Governor-General in Council

These regulations are made under section 68 of the Financial Markets Authority Act 2011—

(a)

on the advice and with the consent of the Executive Council; and

(b)

on the recommendation of the Minster of Commerce and Consumer Affairs.

Regulations

1 Title

These regulations are the Financial Markets Authority (Levies) Amendment Regulations (No 2) 2017.

2 Commencement

These regulations come into force on 8 September 2017.

3 Principal regulations

These regulations amend the Financial Markets Authority (Levies) Regulations 2012 (the principal regulations).

4 Regulation 3 amended (Interpretation)

(1)

In regulation 3, revoke the definitions of authorised dealer, authorised futures dealer, custodian, manager, scheme, and superannuation trustee.

(2)

In regulation 3, insert in their appropriate alphabetical order:

custodian means—

(a)

a custodian, as defined in section 6(1) of the Financial Markets Conduct Act 2013; or

(b)

a person who provides a custodial service, as defined in section 77B of the Financial Advisers Act 2008

debt collection costs, in relation to a person, means costs actually incurred by the FMA in recovering, or attempting to recover, unpaid levy money that is payable by the person

DIMS wholesale provider means a person who provides a DIMS and is not a DIMS retail provider

fund has the same meaning as in regulation 5(1) of the Financial Markets Conduct Regulations 2014

life cycle stage has the same meaning as in regulation 5(1) of the Financial Markets Conduct Regulations 2014

manager has the same meaning as in section 6(1) of the Financial Markets Conduct Act 2013

multi-fund investment option has the same meaning as in regulation 5(1) of the Financial Markets Conduct Regulations 2014

scheme means—

(a)

a registered scheme in which managed investment products have been issued pursuant to an FMC offer; or

(b)

a scheme that is treated as being a registered scheme under clause 22(1)(a) of Schedule 4 of the Financial Markets Conduct Act 2013

5 Regulation 7 amended (Meaning of total managed assets (class 5))

Replace regulation 7(1) with:

(1)

In these regulations, total managed assets, in relation to a person in class 5, means the total value of the assets of all schemes for which the person is the manager.

6 Regulation 9 amended (Persons deemed to be included in classes 4 and 5)

In relation 9(3), delete “or superannuation trustee”.

7 Regulation 13 replaced (Requirements relating to FMA invoicing for levies)

Replace regulation 13 with:

13 Requirements relating to FMA invoicing for levies

(1)

This regulation applies to a levy, or any part of a levy, payable by a person in class 8, 10, or 13 on being issued with an invoice under this regulation.

(2)

A person in class 8 must be invoiced for the levy (other than any debt collection costs) by an annual invoice that must be issued as soon as practicable after the end of a financial year of the licensed market operator with which the person has a listing agreement.

(3)

A person in class 13 must be invoiced for the levy (other than any debt collection costs) by an annual invoice that may be issued before or after the FMA makes the annual confirmation required by section 43 of the Auditor Regulation Act 2011.

(4)

A person in class 8, 10, or 13 may be invoiced for any debt collection costs included in the levy by 1 or more invoices issued at any time after the costs to which the invoice relates have been incurred.

(5)

An invoice for the purposes of this regulation must be issued by or on behalf of the FMA.

8 Schedule 2 amended

(1)

In Schedule 2, item relating to class 6, column 2, replace paragraph (c) with:

(c)

persons registered for the financial service described in section 5(1)(k) of the FSP Act, other than—

(i)

persons included in class 6A, 6B, 6C, or 6D; and

(ii)

DIMS wholesale providers; or

(2)

In Schedule 2, replace the item relating to class 8 with the item relating to that class set out in the Schedule of these regulations.

(3)

In Schedule 2, item relating to class 9, column 5, replace “(per fund (as defined in regulation 5(1) of the Financial Markets Conduct Regulations 2014) covered by the PDS, in the case of a managed fund)” with “per fund, multi-fund investment option, or life cycle stage covered by the PDS, in the case of a managed fund”.

(4)

In Schedule 2, replace the items relating to classes 10 and 13 with the items relating to those classes set out in the Schedule of these regulations.

Schedule Items replaced in Schedule 2

r 8

8Listed issuers (as defined in section 6(1) of the Financial Markets Conduct Act 2013)Being issued with an invoice under regulation 13FMA

$2,990 plus any debt collection costs incurred in relation to the person

10Licensed market operators (other than those licensed under section 317 of the Financial Markets Conduct Act 2013)

For the levy other than debt collection costs, giving a report on compliance to the FMA under section 337 of the Financial Markets Conduct Act 2013

For debt collection costs, being issued with an invoice under regulation 13

FMA

$33,350 plus any debt collection costs incurred in relation to the person

13Overseas auditors holding a specified licence (as defined in regulation 3)Being issued with an invoice under regulation 13FMA

$2,990 plus any debt collection costs incurred in relation to the person

Michael Webster,
Clerk of the Executive Council.

Explanatory note

This note is not part of the regulations, but is intended to indicate their general effect.

These regulations amend the Financial Markets Authority (Levies) Regulations 2012 and come into force on 8 September 2017.

Currently, providers of wholesale discretionary investment management services are in levy class 6(c), for which the levy is $6,095. These amendments will move those providers into levy class 7, for which the levy is $529.

Currently, the levy for class 9 (payable on lodgement of a product disclosure statement (PDS) for managed investment products in a managed fund) is $609.50 per fund covered by the PDS. These amendments will result in the same amount being payable for each multi-fund investment option or life cycle stage of a life cycle investment option covered by the PDS.

For most levy classes, the levy is payable to the Registrar of Financial Service Providers. If the levy is not paid, the Registrar may deregister the person under the Financial Service Providers (Registration and Dispute Resolution) Act 2008. This serves as a deterrent against non-payment of the levy. There is no equivalent sanction for classes 8, 10, and 13, where the levy is payable to the Financial Markets Authority (FMA). If persons in those classes do not pay their levies, the FMA has to take debt recovery action, which results in it incurring costs. New regulation 13 and the related changes to Schedule 2 will allow the FMA to recover those costs from the people who do not pay their levies on time.

These regulations also make a number of minor amendments to update terminology in consequence of the coming into force of the Financial Markets Conduct Act 2013 and to revoke the definitions of terms that are no longer used.

Issued under the authority of the Legislation Act 2012.

Date of notification in Gazette: 10 August 2017.

These regulations are administered by the Ministry of Business, Innovation, and Employment.