Financial Advisers Amendment Act 2010

  • repealed
  • Financial Advisers Amendment Act 2010: repealed, on 15 March 2021, pursuant to section 97(1) of the Financial Services Legislation Amendment Act 2019 (2019 No 8).

Reprint as at 15 March 2021

Coat of Arms of New Zealand

Financial Advisers Amendment Act 2010

Public Act
 
2010 No 40
Date of assent
 
30 June 2010
Commencement
 
see section 2

Financial Advisers Amendment Act 2010: repealed, on 15 March 2021, pursuant to section 97(1) of the Financial Services Legislation Amendment Act 2019 (2019 No 8).

Note

Changes authorised by subpart 2 of Part 2 of the Legislation Act 2012 have been made in this official reprint.

Note 4 at the end of this reprint provides a list of the amendments incorporated.

This Act is administered by the Ministry of Economic Development.

Contents

1Title
2Commencement
3Principal Act amended
4Purpose
5Commencement
6Purpose of Act
7Overview of Act
8Interpretation
9New sections 5A to 5I inserted
5AWho are clients
5BWho are retail clients
5CWho are wholesale clients
5DWho are eligible investors
5EAcceptance of certification
5FRevocation of certification
5GHow to opt out of being wholesale client
5HGiving revocation of certification or notification of opt out
5IMeaning of acting “on behalf of B’s business” and “acting through A”
10New section 7 and subparts 1 and 1A of Part 2 substituted
7Outline
8Who is financial adviser
9What is financial adviser service
10When person gives financial advice
11When person provides investment planning service
12When person provides discretionary investment management service
13Exemption for incidental service
14Other exemptions
15When financial adviser service is personalised service or class service
16Types of financial adviser
17Who may provide financial adviser service
18Who is permitted to provide personalised service to retail clients
19Who is permitted to provide class service to retail clients
20Who is permitted to provide financial adviser service to wholesale clients
20AWho may hold themselves out as authorised financial adviser
20BWho may hold themselves out as financial planner or investment planner
20CWho may hold themselves out as QFE or having QFE status
20DApplication of FSP Act to employees, etc
20EWho must be member of dispute resolution scheme
20FWho is responsible for financial adviser obligations
11New heading and sections 21 to 25 substituted
21What is disclosure obligation and when does it apply
22Financial adviser must make disclosure before providing personalised service to retail client
23What financial adviser must disclose
24Disclosure statement
25QFE must make disclosure before personalised service provided to retail client
12Disclosure by 2 or more financial advisers in joint disclosure statement
13New sections 32 and 33 substituted
32What is conduct obligation and when does it apply
33Financial adviser must exercise care, diligence, and skill
14Financial adviser must not engage in misleading or deceptive conduct
15New section 36 substituted
36Regulations may impose specific conduct obligations for class services to retail clients
16Authorised financial adviser must not recommend or receive money for acquisition of securities if offer for subscription illegal
17Sections 39 to 44 repealed
18New section 45A inserted
45AAuthorised financial adviser may report breach of Act to Commission
19New heading and sections 46 to 48 substituted
46QFE must comply with terms and conditions of grant of QFE status
47QFE or member of QFE group must not engage in misleading or deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative
48Advertisement by QFE or member of QFE group in relation to financial adviser service must not be misleading, deceptive, or confusing
20Eligibility to be authorised
21New sections 55 and 55A substituted
55Commission must approve or decline application for authorisation
55AVariation of terms and conditions and period of authorisation
22Renewal of authorisation
23New sections 63 to 77 substituted
63What is qualifying financial entity (QFE)
64Who may apply for QFE status
65Application for QFE status
66Eligibility for QFE status
67Commission must approve or decline application for QFE status
67AAssociated entities may be subject to special terms and conditions in certain cases
68Determination of application
69Name of QFE group
70Commission must notify Registrar of grant of QFE status
71Addition of associated entities
72Termination of status of associated entity
73Certification of QFE group
74Nominated representatives of QFEs or partner entities
75Variation of terms and conditions and period of grant of QFE status
75ATermination of QFE status
75BCommission may designate certain QFE products as beyond scope of QFE advisers
75CRenewal of QFE status
75DCommission’s powers in relation to QFE default
75EReasonable opportunity to be heard
75FCommission may give QFE direction
75GOther provisions concerning Commission’s powers in relation to QFE default
76Ongoing obligations of QFEs and of partner entities
77QFE must provide annual report to Commission
24New Part 3A inserted
77AWho is broker
77BWhat is broking service
77COther exemptions
77DWhat is disclosure obligation and when does it apply
77EBroker must make disclosure before receiving client money or client property from retail client
77FWhat broker must disclose and form of disclosure
77GDisclosure must not be misleading, deceptive, or confusing
77HDisclosure of additional information
77INo compliance with disclosure obligation if disclosure out of date
77JWhat is conduct obligation and when does it apply
77KBroker must exercise care, diligence, and skill
77LBroker must not engage in misleading or deceptive conduct
77MAdvertisement of broking services must not be misleading, deceptive, or confusing
77NRestriction on use of term sharebroker
77OBroker must not receive client money if offer for subscription illegal
77PBroker must pay client money into separate trust account
77QBroker must account for client money and client property
77RBroker must keep records of client money and client property
77SRestrictions on use of client money and client property
77TProtection of client money and client property held on trust
77UWho is responsible for broker obligations
77VCommission may give broker direction in respect of breach of disclosure or conduct obligation
25Heading to Part 4 amended
26Content of code
27New section 94 substituted
94Code comes into force by Gazette notice
28New section 98 substituted
98Reference of complaint to disciplinary committee
29New heading and sections 114 and 115 substituted
114Offence of providing financial adviser service without being permitted to do so
115Offence of holding out as authorised financial adviser, financial planner, investment planner, or QFE
30Heading above section 117 amended
31Failure to make disclosure under or in accordance with disclosure obligation
32Heading above section 118 amended
33New sections 118 to 120 substituted
118Offence of misleading or deceptive conduct by financial adviser or broker
119Offence of misleading, deceptive, or confusing advertisement by financial adviser or broker
120Offence of contravening restrictions on use of term sharebroker
34Offence of recommending or receiving money in connection with offer of securities when subscription illegal
35Sections 122 to 125 repealed
36New heading and sections 129 to 134A substituted
129Offence of failing to comply with terms and conditions of QFE status
130Offence of misleading or deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative
131Offence of misleading, etc, advertisement of financial adviser service by employee, agent, or nominated representative
132Offence of failing to comply with Commission’s direction
133Offence of failing to comply with obligations in relation to authorised financial advisers
134Offence of failing to provide annual report
134ADefence to offences relating to entities in QFE groups
37New heading and sections 134B to 134G inserted
134BOffence of receiving client money if offer for subscription illegal
134COffence of contravening requirement to pay client money into separate trust account
134DOffence of failing to account for client money and client property
134EOffence in relation to records of client money and client property
134FOffence of breaching restrictions on use of client money and client property
134GOffence of failing to comply with Commission’s direction
38New heading inserted
39New headings and sections 137A to 137S inserted
137AInjunctions against contraventions
137BUndertaking as to damages not required by Commission
137CWhen Court may make banning order
137DTerms of banning orders
137EOffence of contravening banning order
137FWhen High Court may prohibit payment or transfer of money, securities, or other property
137GWhat orders may be made
137HInterim orders
137IRelationship with other law
137JOffence of breaching orders
137KPecuniary order for contravening wholesale certification requirement
137LCompensation for contravention of wholesale certification requirement
137MWhen Commission may make temporary banning orders for financial adviser services or broking services
137NTerms of temporary banning order
137OCommission must follow steps before making orders
137PCommission may shorten steps for specified orders
137QCommission must give notice after making orders
137RGeneral provisions on temporary banning orders
137SOffence of failing to comply with Commission’s orders
40Right of appeal
41New heading and sections 147A to 147E inserted
147AApproval of standard conditions for incorporation in authorisations and grants of QFE status
147BRequirement to consult on proposal to incorporate material by reference
147CVariation or revocation of standard conditions
147DWhen standard conditions come into force
147EIncorporation of changed standard conditions into existing authorisations or grants
42New sections 148 to 148B substituted
148Commission may grant exemptions
148ACommission may vary or revoke exemption
148BStatus of exemptions, variations, or revocations
43Commission must notify reasons for exemption
44Section 150 repealed
45New section 153 substituted
153Levy
46New section 154 substituted
154General regulations
47New section 157 substituted
157Territorial scope
48Section 159 repealed
49New section 168 added
168Grant of authorisations in transitional period without prior inquiry into convictions
50Enactments amended consequential on principal Act
Reprint notes

The Parliament of New Zealand enacts as follows: