|These requirements relate to the Securities Act regime. From 1 December 2014, offers of financial products can be made under the new Financial Markets Conduct Act (FMC Act) regime. However it is important that market participants understand that different requirements will apply to offers under the new FMC Act regime. See here for the latest news and information.|
Prospectuses must be registered with the Registrar of Financial Service Providers, through the Companies office website.
Once a prospectus is registered, it may be reviewed by FMA, to confirm that it complies with the Securities Act 1978 and the Securities Regulations.
Except where the registered prospectus is a continuous issue prospectus, issuers may not allot (or accept subscriptions) for a period of five working days after registration.
The purpose of this period (called the consideration period) is to provide FMA with the opportunity if it so chooses to review the prospectus. FMA can extend this period for a further five working days. It can also waive some or all of the consideration period, allowing securities to be allotted earlier.
How do you register a prospectus?
For information on how to register a prospectus see the Companies Office website.
What do issuers have to do once a prospectus is registered?
Within five working days of registration, issuers need to update their websites to let the public know that the prospectus has been registered.
The website needs to contain a reasonably prominent statement, or reasonably prominent link to a statement, that the prospectus has been registered, and describe where a copy of that prospectus can be found.
Pre-registration review of offer documents (Prospectuses and Investment Statements)
For more information on pre-registration review of offer documents click here.
Post-registration review by FMA
Once a prospectus is registered, FMA may review the document to determine whether it:
- complies with the Securities Act and the Securities Regulations
- contains any material incorrect descriptions or errors, or any material matter that is not clearly legible
- is false or misleading, or omits any material particular.
FMA is not obliged to review every registered prospectus, and may choose not to review in some circumstances. FMA takes a risk-based approach to selecting prospectuses for review.
During the review of a prospectus, FMA may contact the issuer to ask questions about its disclosure and may ask the issuer to correct or improve its prospectus.
Following a review, or at any time later, if FMA thinks a registered prospectus does not comply with the Securities Act and the Securities Regulations or does not contain satisfactory disclosures, we can prohibit allotment and/or cancel the registered prospectus.
If FMA is considering whether to cancel a prospectus we can make an interim order which can be in force for 15 to 30 working days.
Securities cannot be allotted while an interim order is in force. FMA can make an interim order without giving notice to the issuer, though if we do this we will allow the issuer to make submissions after we have made the order.
Under the Financial Markets Authority Act 2011, nothing FMA does can be taken as a guarantee or representation that a prospectus complies with the law, or that FMA has reviewed a prospectus. FMA can exercise its powers to cancel a prospectus at any time, even if it has undergone pre-registration vetting or post-registration review.
When can you allot?
Unless your registered prospectus is a continuous issue prospectus, you cannot allot (or accept subscriptions) until the end of the consideration period. Usually this is five working days after the prospectus is registered, although FMA can extend this to 10 working days. We may also notify you that the period has been shortened, and securities can be allotted.
If your registered prospectus is a continuous issue prospectus you may allot from the date of registration. FMA may determine (by advance notice) that certain classes of continuous issue prospectuses are still subject to the post-registration stand down period for allotment.
If your registered prospectus relates to securities for which there is already a registered prospectus, securities may be allotted and subscribed for under that original prospectus, despite the replacement registered prospectus still being subject to review.
How do you register an amendment to a registered prospectus?
You register an amendment to a registered prospectus in the same way you would register a prospectus. See the Companies Office website.
There is no stand down period for allotment in these circumstances.
Issuers will also be required to update their websites within five working days of registration, to notify the details of the amendment.
How do you register trust deeds and deeds of participation?
See the Companies Office website for information on registering trust deeds and deeds of participation, and any amendments to those deeds.
FMA is notified when a trust deed or deed of participation is registered. We may, at any time, prohibit allotment or cancel a prospectus where we determine that a trust deed or deed of participation:
- does not comply with the Securities Act or the Securities Regulations
- contains any material incorrect descriptions or errors, or any material matter that is not clearly legible.
What about prospectuses and deeds registered under the old registration regime?
These will continue to be treated as registered prospectuses and deeds.
An issuer with an existing registered prospectus won't have to notify registration on its website. But they will need to comply with the new process for amending an existing registered prospectus.