Financial Markets Conduct (Financial Reporting – Precinct Properties Group) Exemption Notice 2024

The Financial Markets Conduct (Financial Reporting - Precinct Properties Group) Exemption Notice 2024 (Notice) exempts Precinct Properties New Zealand Limited (PPNZ) and Precinct Properties Investments Limited (PPIL), which are part of the stapled group comprising PPNZ, PPIL and their respective subsidiaries (Precinct Properties Group) from certain provisions of Part 7 of the Financial Markets Conduct Act 2013 (Act). 

The Notice permits the Precinct Properties Group to prepare consolidated group financial statements for the purposes of Part 7 of the Act instead of each of PPNZ and PPIL having to prepare separate group financial statements.

The Notice is subject to a number of conditions including that PPNZ and PPIL must ensure that their group financial statements are prepared on a consolidated basis in respect of the Precinct Properties Group, the shares of PPNZ and PPIL must remain stapled, PPNZ and PPIL must ensure that they have the same balance date and the consolidated group financial statements for the Precinct Properties Group must disclose relevant transactions between PPNZ and PPIL and their respective subsidiaries.

The key reasons for granting the exemption (as set out in full in the Statement of Reasons in the Notice) are that –

• shares of PPNZ and PPIL are stapled and traded as the single Precinct Properties Group on the NZX Main Board of NZX Limited. Given the nature of the stapled group, in that PPNZ and PPIL operate as a single economic enterprise and the shareholders of PPNZ and PPIL are identical, the financial performance of the Precinct Properties Group as a whole, rather than the separate underlying entities, is of particular relevance to shareholders and potential investors. The nature of interests in PPNZ, PPIL and the Precinct Properties Group are such that financial reporting requirements need to be tailored to ensure that shareholders and potential investors receive meaningful disclosure;
• it is desirable to grant the exemption in order to promote the purposes of the Act, specifically, it –
  • removes unnecessary compliance costs, namely the preparation of two sets of group financial statements when consolidated group financial statements in relation to the Precinct Properties Group will provide more meaningful information in respect of the stapled group and the individual entities comprising it, and thereby also promoting flexibility in financial markets by facilitating the efficient operation of the Precinct Properties Group structure;
  • promotes the confident and informed participation of shareholders and potential investors of the Precinct Properties Group in the financial markets;
  • promotes greater transparency in relation to the Precinct Properties Group, thereby contributing to the development of fair, efficient, and transparent financial markets; and
  • provides timely, accurate, and understandable information to shareholders and potential investors to assist them to make decisions relating to the Precinct Properties Group.

Download the Financial Markets Conduct (Financial Reporting  – Precinct Properties Group) Exemption Notice 2024