Key
1 Title
2 Commencement
Part 1
Preliminary provisions
Purposes
3 Main purposes
4 Additional purposes
Overview
5 Overview
Interpretation
6 Interpretation
7 Meaning of financial product
8 Definitions relating to kinds of financial products
9 Definitions of financial benefit and of managed investment scheme
9A Miscellaneous matters relating to definition of derivative
10 Definitions of issued and issuer
11 Meaning of associated person and related body corporate
12 Miscellaneous interpretation provisions relating to statements and information
13 Status of examples
Act binds the Crown
14 Act binds the Crown
General application provision
15 Application of Act
Part 2
Fair dealing
15A Interpretation in this Part
Misleading or deceptive conduct and false or misleading representations
16 Misleading or deceptive conduct generally
17 Misleading conduct in relation to financial products
18 Misleading conduct in relation to financial services
19 False or misleading representations
20 Certain conduct does not contravene various provisions
21 Limited application of provisions in relation to newspapers, magazines, broadcasting, etc
22 Defence for publisher
23 Defence for reasonable reliance on information supplied by another person
24 Licensed market operator does not contravene by notifying disclosures
25 Other exceptions
26 Territorial scope of sections 16 to 19
Offers in course of unsolicited meetings
26A Prohibition of offers in course of unsolicited meetings with persons acting otherwise than in trade
26B Right to withdraw
26C Offeror obligations if notice of withdrawal given
26D Director not liable if no misconduct or negligence
Civil liability
26E Civil liability for certain contraventions of this Part
Part 3
Disclosure of offers of financial products
Subpart 1—Application
27 Issue offers that need disclosure
28 Sale offers that need disclosure
29 Meaning of regulated offer and of regulated product
30 Regulated offers that need to meet additional governance requirements
31 Options over financial products
32 Treatment of offers of convertible financial products
33 Treatment of offers of renewals and variations
33A Offers of financial products involving customised terms
34 Territorial scope of Part
Subpart 2—Procedure for making regulated offers
Product disclosure statement must be prepared and lodged
35 PDS must be prepared and lodged
36 Purpose of PDS
Disclosure to investors
37 PDS must be given if offer requires disclosure
38 Certain situations in which section 37 does not need to be complied with
39 PDS treated as having been given if application form used was included in, or accompanied by, PDS
40 Offence to knowingly or recklessly contravene section 37
41 Right to withdraw
41A Offeror obligations if notice of withdrawal given
41B Director not liable if no misconduct or negligence
Content and presentation of product disclosure statements and register entries
42 Disclosure of material information and content of PDS and register entry
42A Register entry not required in prescribed circumstances
43 Meaning of material information in this Part
44 Consent of experts and persons who make endorsements
45 PDS must be worded and presented in clear, concise, and effective manner
46 PDS must comply with prescribed requirements relating to form and presentation
Other provisions relating to lodging of PDS and other documents
47 Supply of prescribed information and documents
48 Registrar must notify FMA of lodgement of PDS
49 Waiting period after lodgement before processing applications for financial products
50 FMA may extend period
51 Waiting period restriction does not prevent offeror from acting under another PDS
52 FMA may remove restrictions if its consideration complete or consideration or further consideration unnecessary
53 Waiting period does not usually apply to continuous issue PDSs
54 No guarantee or representation as to compliance
55 When supplementary document or replacement PDS may be lodged
56 Supplementary document
57 Replacement PDS
58 Registrar must notify FMA of lodgement of supplementary document or replacement PDS
59 Publication of lodgement
Amending register entry
60 When register entry may be amended
Conditions referred to in PDS
61 Minimum number or amount condition must be fulfilled before issue or transfer
62 Issue or transfer void if quotation condition not fulfilled
Dealing with applications where condition referred to in PDS is not met or disclosure is defective
63 Application of section 64
64 Choices open to offeror
64A Director not liable if no misconduct or negligence
Prohibition of offers where defective disclosure in PDS or register entry
65 False or misleading statements, omissions, and new matters requiring disclosure
66 Persons who must inform offeror about disclosure deficiencies
Expiry
67 Expiry
68 How offeror must deal with applications on expiry
68A Director not liable if no misconduct or negligence
Money for financial products must be held in trust
69 Money for financial products must be held in trust
Offering financial products in entity that does not exist
70 Offering financial products in entity that does not exist
71 Prohibition of offers in course of unsolicited meetings with persons acting otherwise than in trade
72 Right to withdraw and have money returned
Subpart 3—Advertising
73 Advertising for regulated offers
74 Inducements to apply
75 Distribution of PDS or registered documents
76 Advertising before PDS lodged
77 Advertising after PDS lodged
78 General exceptions
78 Documents to which subpart does not apply
79 Defence for publishers
Subpart 4—Ongoing disclosure and updating of registers
Duty to update register of offers of financial products and register of managed investment schemes
80 Duty to notify changes to Registrar
Disclosure to particular persons
81 Information to be made available to investors or other prescribed persons
Public disclosure
82 Information to be made publicly available
82A Issuer must provide document, information, and matters to Registrar
Defective ongoing disclosure
83 Defective ongoing disclosure
Confirmation
83A Issuer or offeror must provide confirmation
Subpart 5—Civil liability for certain contraventions of this Part
84 Part 3 offer provisions
Part 4
Governance of financial products
86 Overview
Subpart 1—Application and overview
85 Part applies to all regulated products
86 Regulated offers of debt securities need governing document and supervisor
87 Regulated offers of managed investment products need to be in registered scheme
88 All regulated products have other accountability requirements under this Part
Subpart 2—Governance of debt securities
89 Need for governing document and supervisor for regulated offer of debt security
Governing document requirements
90 Contents of trust deed for debt securities
91 Limits on permitted exemptions and indemnities
92 Trust deed must be legally enforceable
93 Effect of trust deed
94 Changes to trust deed
95 Power to make FMA-approved changes to trust deeds
96 Lodging of changes to trust deed
Role of supervisor
97 Functions of supervisor
98 General duties applying in exercise of supervisor's functions
99 Duty of supervisor to comply with professional standard of care
100 Duty of issuer to provide reports to supervisor
101 Duty of issuer to provide requested information and reports to supervisor
102 Issuer must report contravention or possible contravention of issuer obligations
103 Restriction on section 102
104 Duty of issuer to report serious financial problems
105 Power of supervisor to engage expert
Meetings of product holders
106 Meetings of product holders
107 Power of supervisor to attend meetings and appoint chair
107 Supervisor's attendance at meetings of product holders and power to appoint chair
Change of supervisor
108 Change of supervisor
109 Lodging of notice of change of supervisor
Subpart 3—Governance of managed investment products
110 Overview
Need to register
111 Need to register managed investment scheme for regulated offer of managed investment product
Registration
112 Application for registration
113 Initial and ongoing registration requirements for all managed investment schemes
114 Additional initial and ongoing registration requirements for KiwiSaver schemes
115 Additional initial and ongoing registration requirements for superannuation schemes
116 Extent to which superannuation scheme may provide non-retirement benefits
117 Additional ongoing registration requirements for restricted schemes
118 Additional initial and ongoing registration requirements for locked-in superannuation schemes
119 Additional prescribed registration requirements for other particular prescribed types of schemes
120 Manager must ensure that ongoing registration requirements are complied with
121 Changes to registration as particular type of registered scheme
Governing document requirements
122 Contents of governing document for registered scheme
123 Limits on permitted exemptions and indemnities
124 Governing document must be legally enforceable
125 Effect of governing document
126 Changes to governing document
127 Power to make FMA and court-approved changes to governing documents
128 Lodging of changes to governing document
Role of manager
129 Management and administration functions of manager
130 General duties applying in exercise of manager's functions
131 Duty of manager and investment manager to comply with relevant professional standard of care
132 Duties of directors and senior managers of manager
133 Contracting out of management functions
134 Duty of manager to provide reports to supervisor or FMA
135 Duty of manager to provide requested information and reports to supervisor
136 Duty of manager to report contravention or possible contravention of issuer obligations
137 Restriction on section 136
138 Duty of manager to report serious financial problems
Role of supervisor
139 Functions of supervisor
140 General duties applying in exercise of supervisor's functions
141 Duty of supervisor to comply with professional standard of care
142 Power of supervisor to engage expert
Custodianship of scheme property
143 Requirement to have supervisor or other independent person as custodian
144 Custodian holds scheme property on trust
145 Custodian must keep records of scheme property
146 Duty of supervisor to refuse to act on wrongful directions
Meetings of scheme participants
147 Meetings of scheme participants
148 Power of supervisor to attend meetings and appoint chair
148 Supervisor's attendance at meetings of scheme participants and power to appoint chair
149 Manager and associated persons cannot vote if interested in resolution
Management of scheme
150 Requirement for statement of investment policy and objectives
151 Changes to statement of investment policy and objectives
152 Lodging of statement of investment policy and objectives and changes to statement
153 Action that must be taken on limit breaks
154 Action that must be taken on pricing errors and failure to comply with pricing methodologies
155 Actuarial examination of defined benefit scheme or life benefit scheme
156 Power of manager to adjust financial benefits to comply with portfolio investment entity rules
157 Limits on reversion of scheme property in certain schemes to non-scheme participant contributor
Related party transactions
158 Definition of related party benefit
159 General prohibition on transactions giving related party benefits
160 Certain related party benefits permitted
160A Requirements for certificates as to related party benefits
161 Additional restrictions on related party transactions of restricted schemes
161 Additional restrictions on restricted schemes' holdings of in-house assets
Scheme participant transfer rules for KiwiSaver and superannuation schemes
162 Application of scheme participant transfer rules
163 Methods of transfer of scheme participants to another scheme or another section of scheme
164 Transfer of substantial numbers of scheme participants with scheme participant consent
165 Transfer with FMA consent
166 Transfers from KiwiSaver scheme
Provisions as to deferred benefits for superannuation schemes
167 Deferred benefits
Change of manager
168 Application of sections 169 to 176
169 Removal of manager of registered scheme
170 Supervisor or FMA may make temporary appointment
171 Term, powers, and duties of temporary manager
172 FMA's costs must be reimbursed from scheme
173 Supervisor or FMA must take reasonable steps to arrange for new appointment
174 Former manager must hand over records and give reasonable assistance
175 Statutory novation of rights, obligations, and liabilities of former manager
176 Lodging of notice of changes to manager
Change of supervisor
177 Change of supervisor
178 Lodging of notice of change of supervisor
Change of independent trustee
179 Change of independent trustee
Cancellation of registration
180 Cancellation of registration
181 Registrar must remove scheme from register on cancellation of registration
Subpart 4—Intervention in debt securities offered under regulated offer or registered schemes
Provisions assisting supervisor or FMA to intervene
182 Duty of auditor to report to supervisor or FMA
183 Duty of auditor, investment manager, administration manager, custodian, or actuary to report serious problems
184 What person must do if duty to report serious problem applies
185 Protections extend to volunteers of supporting information for other protected disclosures
186 FMA may require supervisor to attest as to issuer's compliance with issuer obligations
187 Duty of supervisor to report contravention or possible contravention of issuer obligations to FMA
188 Duty of supervisor to report serious financial problems to FMA
189 FMA's powers of direction
190 FMA's directions to supervisor (or issuer)
Powers to obtain court orders to intervene
191 Power of supervisor or FMA to apply for order to remedy problems
192 Court orders to remedy problems
193 Power of court to appoint new manager, provide for manager powers, and deal with changes of managers
194 Power of court to direct supervisor
194 Power of court to direct supervisor
195 Court power to order winding up of scheme
196 Initial steps in winding up of registered scheme
197 Winding-up report
Miscellaneous
198 Offence of false or misleading statements
199 Protection for persons in respect of disclosure under this subpart or subpart 5
Subpart 5—Registers and keeping copies of documents
Registers
200 Issuers must keep registers of regulated products
201 Manner of keeping registers
202 Contents of registers
203 Audit of registers
204 Auditor must advise if auditor considers that subpart is not being complied with
205 Issuer must notify Registrar of registers
206 Public inspection of register
207 Manner of inspection
208 Copies of documents
209 Reasons for request must be given and FMA may authorise non-compliance
210 Restriction on use of information in registers
211 Issuer to send confirmation of financial products
212 Requirement for confirmation document does not apply in certain circumstances
213 Certain provisions prevail over Companies Act 1993
Copies of documents to be retained
213A Copies of documents must be retained for 7 years
Subpart 6—Accounting records, copies of documents, and audit of financial statements
Accounting records
214 Issuer must keep proper accounting records
215 Place where accounting records to be kept
216 Accounting records to be in English
217 Period for which accounting records to be kept
218 Inspection of accounting records
Copies of documents to be retained
219 Copies of documents must be retained for 7 years
Audit requirement
220 Financial statements to be audited
221 Meaning of qualified auditor
Miscellaneous
222 Application of other Acts not affected
Subpart 7—Civil liability for certain contraventions of this Part
223 Part 4 governance provisions
Part 5
Dealing in financial products on markets
Subpart 1—Purposes, overview, and interpretation
224 Additional purposes of Part
225 Overview
Material information and generally available to the market
226 Meaning of material information
227 Meaning of generally available to the market
Certain derivatives treated as being quoted financial products of listed issuer
228 Certain derivatives treated as being quoted financial products of listed issuer
Insider conduct
229 Meaning of information insider, inside information, and adviser
Relevant interests
230 Relevant interests in financial products (basic rule)
231 Extension of basic rule to powers or controls exercisable through trust, agreement, etc
232 Extension of basic rule to interests held by other persons under control or acting jointly
233 Situations not giving rise to relevant interests
Subpart 2—Insider trading
Insider conduct prohibited
234 Prohibition of insider conduct
235 Information insider must not trade
236 Information insider must not disclose inside information
237 Information insider must not advise or encourage trading
238 Criminal liability for insider conduct
When prohibition on insider conduct does not apply
239 Exception for trading required by enactment or rule of law
240 Exception for disclosure required by enactment or rule of law or by FMA
241 Exception for disclosure in connection with preparing PDS or disclosure document
242 Exceptions in respect of underwriting agreements
243 Exception in case of knowledge of person's own intentions or activities
244 Exception in case of knowledge in relation to derivatives
245 Exception for agent executing trading instruction only
246 Exceptions from section 235 for takeovers
247 Exceptions from sections 236 and 237 for takeovers
248 Exceptions for schemes of arrangement approved under Companies Act 1993
249 Exception for redemption of managed investment products
250 Exception for Reserve Bank
Defences
251 Absence of knowledge of trading
252 Inside information obtained by independent research and analysis
253 Equal information
254 Options and trading plans
255 Chinese wall defence
Subpart 3—Market manipulation
256 Misleading or deceptive conduct generally in dealings in quoted financial products
257 False or misleading statement or information
258 Exception for takeovers
259 Criminal liability for false or misleading statement or information
260 False or misleading appearance of trading
261 Exception for short selling and crossings
262 Persons treated as contravening false or misleading appearance of trading prohibition
263 Defence
264 Criminal liability for false or misleading appearance of trading
Subpart 4—Continuous disclosure
265 Listed issuers must disclose in accordance with listing rules if continuous disclosure listing rules apply
266 What are continuous disclosure provisions
267 No contravention of continuous disclosure provisions by person who takes reasonable steps to ensure listed issuer complies
Subpart 5—Disclosure of interests of substantial product holders in listed issuers
Substantial holding disclosure obligations
268 Purpose of subpart
269 Meaning of substantial product holder, substantial holding, and percentage
270 Persons must disclose if begin to have substantial holding
271 Substantial product holders must disclose if subsequent movement of 1% or more in holdings
272 Substantial product holders must disclose if subsequent changes in nature of relevant interests
273 Persons must disclose if cease to have substantial holding
274 What disclosure required
275 Form and method of disclosure
276 Listed issuer must give acknowledgement of disclosure
277 How to ascertain total financial products in class for purposes of disclosure
Exemptions
278 Exemption for persons with interest in other substantial product holders who comply
279 Exemption for corporate trustees and nominee companies
280 Conditions of exemption for corporate trustees and nominee companies
281 Exemption for persons under control or acting jointly with corporate trustees and nominee companies
282 Extended time for disclosure for trustees, executors, and administrators
Tracing and disclosure of interests in listed issuers
283 FMA may require persons to disclose to market relevant interests and powers to get relevant interests
284 Listed issuer may require registered holder to disclose relevant interests to it
284 Listed issuer may require registered holder or relevant interest holder to disclose relevant interests to it
285 Listed issuer may require person who has relevant interest to disclose information to it
286 Form and method of notice requiring disclosure
Register and publication of substantial holdings
287 Listed issuers must maintain register of disclosures of substantial holdings
288 Public inspection of register
289 Copies of documents
290 Offences relating to substantial holdings register
291 Listed issuers must make available information on substantial holdings
292 No liability for publication of substantial holdings
293 Notice under this subpart not to affect incorporation of listed issuer or constitute notice of trust
Subpart 6—Disclosure of relevant interests in quoted financial products by directors and senior managers of listed issuers
294 Purpose of subpart
295 Directors and senior managers of listed issuers must disclose relevant interests and dealings in relevant interests
296 Disclosure of relevant interests and dealings in relevant interests in relation to specified derivatives
297 What disclosure required
298 Form and method of disclosure
299 Disclosure obligation applies for 6 months after ceasing to hold office
300 Exemption for directors or senior managers who disclose substantial holdings
301 Exemption for overseas listed issuers
302 Listed issuer must keep interests register
303 Public inspection of interests register
304 Copies of documents
305 Offences relating to interests register
Subpart 7—Licensing of markets for trading financial products
306 Principles guiding exercise of powers under this subpart
Need for financial product market licence
307 What is a financial product market
308 Need for financial product market licence
309 Prohibitions on holding out
310 Exemptions
311 When financial product market taken to be operated in New Zealand
General obligations of licensed market operator
312 General obligations in respect of licensed markets
Issue of licence
313 Application for licence
314 When licence may be issued
315 When licence may be issued for overseas-regulated market
316 Conditions of licence
317 Procedural requirements
318 Licence may cover more than 1 financial product market
319 Licence may cover subsidiaries
320 FMA must maintain list of licensed markets on Internet site
Changes to licences
321 Variation of conditions
322 Minister may suspend or cancel licence
323 Procedure for varying of conditions or suspension or cancellation of licence
324 Effect of suspension
325 Variation or revocation of suspension
Approval of contractual market rules
326 Licensed markets must be operated under market rules that comply with this subpart
327 Required matters for market rules
328 When market rules have effect
329 Approval process for proposed market rules and rule changes
330 Approval of proposed market rules and changes
331 Notice of decision on rules
332 Power of FMA to request changes to market rules on certain matters
333 Overseas-regulated markets must give notice of market rules and rule changes to FMA
334 Market rules must be available for public inspection
335 Application of Acts relating to regulations to contractual market rules
Monitoring of market operator obligations
336 Licensed market operator must give report on compliance with market operator obligations to FMA
337 FMA to carry out market operator obligations reviews
338 FMA must make written report on market operator obligations review
339 FMA may require licensed market operator to submit action plan on failure to meet market operator obligations
340 Approval, amendment, or rejection of action plan
341 Minister may give market operator obligations direction to licensed market operator
342 Minister may vary, suspend, or cancel licence
Control limits on licensed market operators
343 Power to impose control limits on licensed market operators
344 Control limit not to be exceeded
345 Effect of exceeding control limit
346 Application for approval to exceed control limit
347 Revocation or amendment of approval
Other provisions relating to licensing of financial product markets
348 FMA may give advice to Minister
349 Delegation of Minister's licensing functions and powers to FMA
350 Regulations modifying Part for licensed markets
Subpart 8—Operation of licensed markets
351 Licensed market operator must notify FMA of disciplinary actions and suspected contraventions
352 When notification required
353 Details and method of notification
354 Licensed market operator must ensure FMA has access to real-time trading and other information
355 Licensed market operator must give FMA material information given to market participants
356 Waiver of notification and disclosure obligations
357 Licensed market operator must give FMA or Takeovers Panel other information and assistance on request
358 Power to disclose further information
359 Licensed market operator must give notice and have regard to submissions on continuous disclosure determinations
360 Limited notice and submissions for urgent determinations
361 FMA may give directions to licensed market operators
362 Grounds for continuous disclosure direction
363 Grounds for other directions
364 Notice, opportunity for licensed market operator to act, and submissions before FMA gives directions
365 Limited notice and submissions for urgent continuous disclosure directions
366 Notice and opportunity to be heard and represented after FMA gives direction
367 Effect of directions to licensed market operator
368 Provisions as to directions
369 Contracting out of or modification of continuous disclosure process requirements
370 Offence for failing to comply with direction
Subpart 9—Transfer of transferable financial products
371 Financial products to which this subpart applies
Transfer of specified financial products using transfers in prescribed form or containing prescribed information
372 Transfer of specified financial products by transfer
373 Transfer of specified financial products by products transfer and brokers transfer
374 Products transfer does not need to be witnessed
375 Transfers to be instruments of transfer for purposes of other enactments and instruments
Transfer of specified financial products by electronic means
376 Approval of electronic transfer system
377 Specified financial products may be transferred under approved system
378 Minor technical modifications to system
Registration may not be refused
379 Registration may not be refused on ground that financial products have been transferred under this subpart
380 Effect of this Act on other enactments
Subpart 10—Unsolicited offers to purchase financial products off-market
381 Definitions relating to unsolicited offer regulations and related provisions
382 Regulations concerning unsolicited offers
383 Specific provisions for regulations concerning unsolicited offers
384 Protection from liability in connection with unsolicited offer provisions
Subpart 11—Civil liability for certain contraventions of this Part
385 Part 5 market provisions
Part 6
Licensing and other regulation of market services
386 Overview
386A Territorial scope for licensing of certain market services
Subpart 1—Key provisions
387 When provider of market services needs to be licensed
387A Exemptions from need for market services licence
388 When providers of other market services may be licensed
389 Meaning of licensed market services
390 Prohibitions on holding out
390A Meaning of discretionary investment management service and related terms
Subpart 2—Issue of licences, conditions, and duration
391 Principles guiding the exercise of FMA powers
Issue of licences
392 FMA may issue licence
393 Application for licence
394 When licence must be issued
395 Procedural requirements
396 Notice of decision
397 Licence must be issued for particular market services
398 Licence may cover subsidiaries
398 Licence may cover related bodies corporate as authorised bodies
399 FMA must send licence details to Registrar
Conditions of licence
400 Conditions of licence
401 When FMA may impose permitted conditions
402 Licensee may apply for variation of conditions
403 Procedure for variation of conditions
404 Consequences of contravening conditions
Expiry, suspension, or cancellation of licences
405 Duration of licence
406 When FMA may suspend or cancel licence
407 Effect of expiry, suspension, or cancellation of licence on appointments
Subpart 3—Monitoring and enforcement of licences
408 Meaning of material change of circumstances
Reports
409 Licensee must deliver reports to FMA
410 Licensee must report certain matters
411 Restriction on section 410
FMA's powers in case of contravention of market services licensee obligation, material change, etc
412 FMA's powers in case of contravention of market services licensee obligation, material change, etc
413 Procedure for exercising powers
414 Notice requirements
Action plan
415 Action plan
416 Approval, amendment, or rejection of action plan
417 Consequences of failure to submit action plan, rejection of action plan, or failure to comply with action plan
Directions
418 Directions
419 Consequences of failure to comply with directions
Subpart 4—Disclosure obligations for certain services provided to retail investors
420 Application of subpart
421 Disclosure must be made before providing service to retail investor
422 Timing and method of disclosure
423 Purpose of disclosure statement
424 Disclosure statement
425 False or misleading statements and omissions
426 Further prescribed information to be made available
Subpart 5—Requirement for certain services to be provided under client agreements
427 Application of subpart
427A Need for client agreement
428 Contents, form, and effect of client agreement
Subpart 6—Additional regulation of discretionary investment management services
429 Application of subpart
430 Meaning of provider of discretionary investment management service and related terms
Duties of DIMS licensee
431 DIMS licensee's duties
432 Duties of directors and senior managers of DIMS licensee
433 Duty of DIMS licensee to comply with professional standard of care
434 Limits on permitted indemnities
435 Requirement for agreed investment mandate
436 Action that must be taken on limit breaks
Related party transactions
437 Definition of related party benefits
438 General prohibition on transactions giving related party benefits
439 Certain related party benefits permitted
439A Requirements for certificates as to related party benefits
DIMS licensees must hold investor money in trust
440 Money paid by, or on account of, investors must be held in trust
Custodial service performed as part of discretionary investment management service
441 Application of sections 442 and 443
442 Requirements for custodian
443 Certain broker obligations of Financial Advisers Act 2008 apply under this Act
Subpart 7—Holding and application of investor funds and property by derivatives issuers
444 Application of regulations made under this subpart
445 Regulations regulating holding and application of investor funds and property by derivatives issuers
Subpart 8—Miscellaneous provisions
Civil liability
446 Part 6 licence provisions
Part 6A
Financial reporting
Subpart 1—Overview
446A Overview
446B Interpretation
Subpart 2—Accounting records
446C Issuer must keep proper accounting records
446D Place where accounting records to be kept
446E Accounting records to be in English
446F Period for which accounting records to be kept
446G Inspection of accounting records
Subpart 3—Audit of financial statements
446H Financial statements to be audited
446I Meaning of qualified auditor
446J Appointment of registered audit firm
446K Application of other Acts not affected
Subpart 4—Civil liability for certain contraventions of this Part
446L Part 6A financial reporting provisions
Part 7
Enforcement, liability, and appeals
447 Meaning of contravene
Subpart 1—FMA's enforcement powers
Stop orders
448 When FMA may make stop orders
449 Terms of stop order
450 Meaning of restricted communication
451 FMA may make interim stop order pending exercise of powers
452 Persons to whom stop orders and interim stop orders may apply
452A Extended application of subpart
Direction orders
453 When FMA may make direction orders
454 Terms of direction orders
Unsolicited offer orders
455 When FMA may make unsolicited offer orders
456 Terms of unsolicited offer orders
Orders that exclusion does not apply
456A FMA may order that exclusion for offers of products of same class as quoted products does not apply
Process for FMA's orders
457 FMA must follow steps before making orders
458 FMA may shorten steps for specified orders
459 FMA must give notice after making orders
General provisions
460 General provisions on FMA's orders
461 Consequences of failing to comply with FMA's orders
Subpart 2—High Court's enforcement powers
Injunctions
462 Court may grant injunctions
463 When court may grant injunctions and interim injunctions
464 Undertaking as to damages not required by FMA
Court may make FMA orders under this Part
465 Court may make FMA orders under this Part
Subpart 3—Civil liability
Overview of civil liability
466 Overview of civil liability
467 What are civil liability provisions
Declarations of contravention and pecuniary penalty orders
468 When court may make declarations of contravention
469 Purpose and effect of declarations of contravention
470 What declarations of contravention must state
471 When court may make pecuniary penalty orders
472 Directors treated as having contravened in case of defective disclosure and may be ordered to pay pecuniary penalty
473 Maximum amount of pecuniary penalty
474 Guidance for court on how to determine gains made or losses avoided for purposes of maximum amount
475 Considerations for court in determining pecuniary penalty
476 Court must order that recovery from pecuniary penalty be applied to FMA's or Commerce Commission's actual costs
Compensatory orders
477 When court may make compensatory orders
478 Terms of compensatory orders
479 Director has due diligence defence
480 Person treated as suffering loss or damage in case of defective disclosure
Other civil liability orders
481 When court may make other civil liability orders
482 Terms of other civil liability orders
Defences for person in contravention of civil liability provisions
482A General defences for person in contravention
482B Disclosure defences for person in contravention
482C Additional disclosure defence for directors who are treated as contravening
482D Conduct still contravenes even if defence is available
Defences for person involved in contravention of civil liability provisions
482E General defences for person involved in contravention
Miscellaneous provisions relating to defences
482F Defendant must identify other person
Interrelationship of civil liability orders
483 More than 1 civil liability order may be made for same conduct
484 Only 1 pecuniary penalty order may be made for same conduct
485 No pecuniary penalty and fine for same conduct
Limitation defences
485A Limitation defences
Due diligence defence
486 Defence for persons other than primary person in contravention
General
487 Rules of civil procedure and civil standard of proof apply to civil liability
487A Commerce Commission may apply for order in relation to Part 2
Subpart 4—Offences relating to defective disclosure and false statements
488 Offence of knowingly or recklessly contravening prohibition on offers where defective disclosure in PDS or register entry
489 Offence of knowingly or recklessly contravening other provisions relating to defective disclosure
489A General offence for false or misleading statements
Subpart 5—Infringement offences
490 Infringement offences
491 Infringement notices
492 Procedural requirements for infringement notices
493 Payment of infringement fee
Subpart 6—Banning orders
494 When court may make banning orders
495 Terms of banning orders
496 Offence of contravening banning order
497 Only 1 banning order may be made for same conduct
498 General provisions for banning orders
Subpart 7—Orders to protect interests of aggrieved persons in case of financial markets investigations or proceedings
499 When court may make order to protect interests of aggrieved persons
500 What orders may be made
501 Interim orders
502 Relationship with other law
Subpart 8—Indemnities or insurance for directors, employees, and auditors of issuers, offerors, and licensees
503 Prohibition on indemnities or insurance for directors or employees of issuers, offerors, or licensees that are not New Zealand companies
504 Permitted indemnities for certain liabilities or costs
505 Permitted insurance for certain liability or costs
505A Prohibition on indemnity or insurance for auditors of issuers, offerors, or licensees
506 Interpretation for this subpart
Subpart 9—Appeals
507 Appeals against market services licence decisions
508 Appeals against other decisions of FMA on questions of law only
Subpart 10—Miscellaneous
509 Time for laying information for summary offences
Accessories and attribution of liability
509 Involvement in contraventions
509A Directors treated as having contravened in case of defective disclosure
509B State of mind of directors, employees, or agents attributed to body corporate or other principal
509C Conduct of directors, employees, or agents attributed to body corporate or other principal
Miscellaneous
509D Time for filing charging document for certain offences
510 Jurisdiction of courts in New Zealand
511 Orders to secure compliance
512 General provisions as to court's orders
513 Persons entitled to appear before court
514 State of mind of directors, employees, or agents attributed to body corporate or other principal
515 Conduct of directors, employees, or agents attributed to body corporate or other principal
516 Saving of liability under Crimes Act 1961 and general law
Part 8
Regulations, transitional provisions, and miscellaneous provisions
Subpart 1—Regulations
517 Regulations for purposes of Part 3 (disclosure of offers of financial products)
518 Regulations for purposes of Part 4 (governance of financial products)
519 Regulations for purposes of Part 5 (dealing in financial products on markets)
520 Regulations for purposes of Part 6 (market services)
521 Transitionals, savings, and orderly implementation of Act and related enactments
522 Other regulations
522A Minister must consult FMA about regulations
523 Procedural requirements for regulations relating to exemptions, exclusions, and definitions
524 Miscellaneous provisions relating to exemptions
525 Miscellaneous provisions relating to fees and charges
526 Regulations or exemptions may require compliance with generally accepted accounting practice, financial reporting standards, or FMA frameworks or methodologies
527 Different matters may be prescribed in respect of different circumstances
Subpart 2—Exemptions
528 FMA may grant exemptions
529 Restriction on FMA's exemption power
530 Exemption in force for not more than 5 years
531 Breach of exemption conditions
532 Exemptions in respect of specified overseas jurisdictions
532A Effect of exemptions on regulated offers
Subpart 3—FMA's designation power
533 FMA may designate financial products and offers
534 Procedural requirements
535 Transitional matters
536 FMA may make interim orders pending exercise of powers
537 Period in which interim order is in force
Subpart 4—Frameworks or methodologies
537A Purpose
538 FMA may specify frameworks or methodologies
539 Consultation
Subpart 5—General provisions relating to certain FMA instruments
540 Application of subpart
541 Status and publication of instruments
542 Variation and revocation
Subpart 6—Recognition and application regimes
543 Purpose of this subpart
544 Definition of country in this subpart
Exemption from Act and regulations for New Zealand offers under recognition regime
545 Exemption from Act and regulations for New Zealand offers under recognition regime
546 Power to exempt from Act and regulations under recognition regime
547 Matters that must be stated in regulations implementing recognition regime
548 Offence for breach of regulations implementing recognition regime
Extension of Act and regulations to overseas offers under application regime
549 Extension of Act and regulations to overseas offers under application regime
550 Power to extend Act and regulations under application regime
551 Matters that must be stated in regulations implementing application regime
Subpart 7—Enforcement of overseas pecuniary penalties under application regime
552 Purpose of this subpart
553 Enforcement of overseas pecuniary penalties under application regime
554 Power to enforce overseas penalties under application regime
555 Interpretation
556 Registration of judgment
557 Effect of registration
558 Enforceability of registered judgment
559 Stay may be granted
560 Costs
561 Interest
562 Rules of private international law not to apply
563 Other regulations for registration of judgments under application regime
Subpart 8—Transitional and miscellaneous provisions
563A Registers
563B Transitional provisions
Part 9
Repeals and amendments
Subpart 1—Repeals and revocations
564 Repeals
565 Revocations
Subpart 2—Amendments to Fair Trading Act 1986
566 Principal Act amended
567 New section 5A substituted
567A New section 48B inserted (Commission's powers in relation to Part 2 of Financial Markets Conduct Act 2011)
567B Transitional provision for existing offences and contraventions
Subpart 3—Amendments to Financial Advisers Act 2008
568 Principal Act amended
569 Interpretation
570 Who are wholesale clients
571 When person provides discretionary investment management service
572 Other exemptions
573 When financial adviser service is personalised service or class service
574 Who is permitted to provide personalised service to retail clients
575 Who is permitted to provide class service to retail clients
576 Financial adviser must make disclosure before providing personalised service to retail client
577 What financial adviser must disclose
578 QFE must make disclosure before personalised service provided to retail client
579 No compliance with disclosure obligation if disclosure out of date
580 New section 29A inserted
581 What is conduct obligation and when does it apply
581A Financial adviser must exercise care, diligence, and skill
582 New sections 36A to 36D inserted
583 New section 38 substituted
584 Other exemptions
585 What is conduct obligation and when does it apply
586 Restriction on use of term sharebroker
587 New section 77O substituted
588 Offence of recommending offer of securities when subscription illegal
589 Offences of receiving client money if offer for subscription illegal
590 Heading to subpart 4 of Part 4 amended
591 Sections 137C to 137J and heading repealed
592 Pecuniary order for contravening wholesale certification requirement
593 When FMA may make temporary banning orders for financial adviser services or broking services
594 General regulations
Subpart 4—Financial Markets Authority Act 2011
595 Principal Act amended
596 Interpretation
597 FMA's functions
597A Power to enter and search place, vehicle, or other thing
598 FMA may exercise person’s right of action
599 FMA may accept undertakings
600 New section 46A inserted
601 New heading and section 48A inserted
602 FMA may require its warning to be disclosed
603 Schedule 1 amended
Subpart 5—Amendments to KiwiSaver Act 2006
604 Principal Act amended
605 Purpose
606 Interpretation
607 Meaning of provider
608 Outline
609 Outline of how people become members of overall KiwiSaver scheme
610 Extension of opt-out period
611 Sections 24 to 32 and heading repealed
612 Employer must also supply investment statement for employer’s chosen KiwiSaver scheme (if any)
613 Effect of employer choice of KiwiSaver scheme
614 Commissioner provisionally allocates certain people to default KiwiSaver schemes and sends investment statement
615 New section 52 substituted
616 Notification of transfers and requirement to transfer funds and information
617 Compulsory employer contribution amount: general rule
618 Sections 101H to 101K and heading repealed
619 Part 4 substituted
620 Sections 205 to 206 repealed
621 Sections 209 and 210 and heading repealed
622 Duty of Commissioner under section 50 modified in certain cases in which section 210 applies
623 Section 220 substituted
624 Administration of Act
625 Section 225 repealed
626 Status of Crown contribution and fee subsidy for tax purposes
627 Section 228 substituted
628 Regulations relating to default KiwiSaver providers
629 Sections 231 to 237 repealed
630 Amendments to Schedule 1 (KiwiSaver scheme rules)
631 Further amendments to Schedule 1 (KiwiSaver scheme rules)
632 Schedules 2 and 3 repealed
Subpart 6—Amendments to Securities Trustees and Statutory Supervisors Act 2011
633 Principal Act amended
634 Name of principal Act changed
635 New section 3 substituted
636 Interpretation
637 Heading to Part 2
638 Heading to subpart 1 of Part 2
639 New section 6 substituted
640 New section 8 substituted
641 Requirement to be licensed: exception for certain FMA appointees
642 New section 10 substituted
643 FMA may impose conditions on licence
644 Information to be stated in licence
645 FMA must send licence and details to licensee and others
646 Decision on application for, or to vary, licence
647 Application to cancel licence
648 Notice, consultation, and submissions concerning decision under section 16(1)
649 Appeal to High Court against FMA's decision on application
649A Cross-heading amended
650 Effect of expiry of licence
651 Licensee must apply for new licence or notify issuer or operator before licence expires
652 Rejection of application for new licence: FMA may replace existing appointee
653 Expiry of licence: issuer or operator may replace existing appointee or FMA appointee
654 Expiry of licence: existing appointee must provide documents
655 FMA may vary licence because of material change of circumstances, etc
656 FMA's powers if action plan not submitted, etc
657 Removal notice
658 Removal notice: FMA may give direction to existing appointee
659 Removal notice: FMA may replace existing appointee
660 Replacement notice: affected person may replace existing appointee or FMA appointee
661 Notice requiring documents: existing appointee, etc, must provide documents
662 New section 41 substituted
663 Compensation orders
663 Compensation orders
664 Part 3 repealed
665 FMA may vary or cancel direction
666 New section 52 substituted
Transitional provisions
667 FMA may vary licences under Financial Markets Supervisors Act 2011
668 Appeal against licence decision
Subpart 7—Amendments to other enactments
669 Amendments to other enactments
Subpart 8—Transitional provisions for offers of financial products
670 Act applies to offer unless former enactments continue to apply
671 Former enactments continue to apply if prospectus registered before commencement
672 Issuer may elect to comply with former enactments instead of this Act if prospectus registered within 12 months of commencement
673 Former enactments apply if no prospectus is required unless issuer elects otherwise
674 Transitional provisions that apply after 12-month date in respect of registered prospectuses
675 This Act and 1978 Act are (on transitional basis) alternative means of compliance
676 All offers and allotments under old law must cease
677 All offers and allotments under old law must cease within 2 years of commencement
678 FMA may continue to perform and exercise functions, duties, and powers
679 Subpart does not prevent PDS from being lodged
680 Transitional and application provisions subject to exemption
Subpart 9—Transitional provisions relating to securities offered under Securities Act 1978
681 Subpart applies to securities offered under Securities Act 1978
682 Interpretation in this subpart
683 Former enactments continue to apply until effective date
684 KiwiSaver schemes, superannuation schemes, and unit trusts continue under former enactments until effective date
685 Transition period
686 Ongoing requirements of this Act apply on and after effective date
687 Issuer of debt security must lodge trust deed and supply information
688 Managed investment scheme treated as being registered and issuer must supply information
689 Type of registration
690 Registrar to amend register
691 Restriction on making regulated offers and accepting contributions if requirements have not been complied with
692 Issuer may amend or replace governing document with FMA's consent
693 Conversion of governing documents to separate governing documents
694 Amalgamation of schemes
695 Amended enactments continue to apply or have effect in connection with securities
696 Issuer must send notification to security holders
697 PDS treated as having been given
698 FMA may continue to perform and exercise functions, duties, and powers
699 Transitional and application provisions subject to exemption
Subpart 10—Other transitional provisions
Unit trusts and superannuation schemes in relation to which offers to the public have not been made
700 Unit trusts in relation to which offers to public have not been made
701 Superannuation schemes in relation to which offers to public have not been made
Amended enactments continue to apply or have effect in connection with schemes
702 Amended enactments continue to apply or have effect in connection with schemes
Extra transitional provisions relating to managed investment schemes
703 Remaining trustees (if any) cease to hold office
704 Restricted schemes have 3 years to comply with related party asset cap rule
705 Savings related to Superannuation Schemes Act 1976
Repealed enactments continue to be financial markets legislation
706 Repealed enactments continue to be financial markets legislation
Licensing of financial product markets
707 Transition process for existing financial product markets
Market services licences
708 Authorised dealers treated as holding market services licence
709 FMA may exercise powers in respect of licences
Approval of electronic transfer systems continues
710 Approval of electronic transfer systems continues
References to banning orders under this Act include references to banning orders under former enactments
711 References to banning orders under this Act include references to banning orders under former enactments
Financial Reporting Act 1993
712 Issuers continue to be issuers under Financial Reporting Act 1993
713 External Reporting Board must review tiers of financial reporting
Schedule 1
Provisions relating to when disclosure is required and exclusions for offers and services
Schedule 2
Registers
Schedule 3
Schedule 3 schemes
Schedule 4
Consequential amendments
Schedule 5
Transitional provisions
Legislative history