Dated at Wellington this 23rd day of April 2020.
Sarah Vrede,
Director of Capital Markets.
Statement of reasons
The exemptions only apply to the extent that the market participant is required to comply with the obligation within a time frame (for example, within 4 months after the market participant’s balance date). The exemptions apply if the market participant believes, on reasonable grounds, that it is not reasonably practicable for it to comply within that time frame because of the outbreak of COVID-19. The exemptions are subject to conditions that the market participant—
complies within an extended period of 2 months; and
notifies the Financial Markets Authority (the FMA) that it is relying on the exemption; and
in some cases, lodges the notice to the FMA with the Registrar of Financial Service Providers.
This notice also amends a number of class exemptions issued by the FMA under the Act (the class notices). To similar effect, the amendments extend the time frame for complying with certain conditions by 2 months if the exempt person believes, on reasonable grounds, that it is not reasonably practicable for it to comply within that time frame because of the outbreak of COVID-19.
The FMA, after satisfying itself as to the matters set out in section 557 of the Act and after consulting the Reserve Bank in accordance with section 561A(2) of the Act, considers it appropriate to grant the exemptions, and to amend the class notices, because—
compliance with certain financial reporting, audit, and other duties under the Act, the Regulations, and the class notices within current required time frames has or is likely to become practically difficult for some market participants as a consequence of the outbreak of COVID-19; and
in these circumstances, some market participants will require additional time to comply with their obligations; and
taking a flexible approach and granting extended time for compliance will assist market participants to meet their obligations in a safe, efficient, and orderly manner and without unnecessary compliance costs and promote flexibility in the financial markets. This will also help ensure that the information provided to investors is appropriately prepared, accurate, and audited and that there is continued confidence and informed participation by investors and businesses in the financial markets; and
as such, it is satisfied that the granting of the exemptions, and the amending of the class notices, is desirable in order to promote the purposes of the Act, specifically to provide for accurate information to be provided to persons to assist them to make decisions relating to financial products or the provision of financial services, avoid unnecessary compliance costs, promote the confident and informed participation of businesses, investors, and consumers in the financial markets, and promote flexibility in those markets; and
it is satisfied that the extent of the exemptions and the amendments is not broader than reasonably necessary to address the matters that gave rise to the exemptions and amendments, given that relief will only apply to market participants with balance dates or relevant dates, as the case may be, between 31 December 2019 and 1 August 2020 where it is not reasonably practicable for them to meet current reporting or audit time frames because of the outbreak of COVID-19.
Issued under the authority of the Legislation Act 2012.
Date of notification in Gazette: 28 April 2020.
This notice is administered by the Financial Markets Authority.