All crowdfunding service providers have a number of obligations, in addition to the minimum standards and standard conditions set out in their licence. These obligations include meeting the relevant professional standard of care; monitoring your compliance; identifying material changes of circumstances; meeting reporting obligations and notifying the FMA of certain events and providing us with information. A list of your obligations can be viewed below.
Read the Standard Conditions for crowd funding service licences to fully understand these obligations.
Your licence may also have specific conditions attached to it, additional to the above. Entities should understand all conditions that apply. Individual licences, including specific conditions, can be found on the Disclose register.
Changes to directors or senior managers
Forms to be completed if there are changes to directors or senior managers
Download Notification of change of director or senior manager by licensee and/or key personnel of authorised body PDF. (Refer Financial Markets Conduct Regulations 2014 r 191).
Licensed crowd funding service providers will have to meet and maintain certain minimum standards. The key standards in section 396 of the FMC Act including the following:
- You must be a fit and proper person for the role of independent trustee.
- You or your business must be capable of performing the service effectively and in keeping with your licence conditions.
- We must have no reason to think you’re likely to contravene your licensee obligations.
- There are other important requirements.
Download the crowd funding licensing guide to understand the minimum standards you’ll need to show you meet, and information about the details and supporting documents you’ll need to provide.
The fair dealing provisions of the FMC Act prohibit misleading or deceptive conduct, false, misleading or unsubstantiated representations, and offers of financial products in the course of an unsolicited meeting.
The FMA has issued a guide to fair dealing in advertising and communications specific to crowd funding and peer-to-peer lending service licence. The purpose of this guidance document is to ensure licensed crowd funding and peer-to-peer lending service providers understand their obligations when advertising or communicating with customers.
Crowdfunding issuers fair dealing
Under exemptions in financial markets law, crowdfunding issuers don't need to prepare a product disclosure statement if you are using a licensed crowdfunding service provider. Instead, you will provide more limited information about your business when you make offers.
You will need to comply with the general fair dealing provisions in Part 2 of the FMC Act. The basic obligations you will have include not making:
- false or misleading representations, for example, you must be honest about who you are and what you're going to use the money for
- unsubstantiated representations, for example, you must ensure you have a reasonable grounds for any financial projections provided to potential investors.
Other laws will also apply. For example, you will need to provide financial information to your shareholders under the Companies Act. And, where you have 50 or more shareholders those shareholders may have to comply with the Takeovers Code when buying shares.
Anti-money laundering and countering financing of terrorism
The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 imposes several obligations on crowd funding licence holders;
- You must provide a written risk assessment of the money laundering and financing of terrorism activity you could expect in the course of running your business.
- You are required to implement an anti-money laundering and countering financing of terrorism programme that includes procedures to detect, deter, manage and mitigate money laundering and the financing of terrorism.
- You are required to appoint a compliance officer to administer and maintain your programme.
- You are required to perform due diligence processes on your customers. This includes customer identification and verification of identity.
- You are required to report suspicious transactions.
Read more about AML/CFT reporting obligations
Crowd funding service providers are FMC reporting entities and must comply with the following:
- Keep proper accounting records to assist with the preparation of compliant financial statements. Records must be kept in English and a copy must be kept in New Zealand.
- Prepare financial statements for the group's operation. Financial statements must comply with generally accepted accounting practices in New Zealand.
- Ensure that financial statements are audited by a licensed auditor or registered audit firm.
- Lodge financial statements and the auditor’s report with the Companies Office within 4 months of the balance date.
Every licensed crowd funding provider is required to complete and submit an annual regulatory return which is a series of questions about your business and how your licensed service is used. The information you provide us through the annual return helps us to:
- better understand your business and the services you offer;
- ensure the information we have on your business is current; and
- focus our monitoring activities more effectively.
Submit your regulatory returns online at FMA's Online Services portal
To complete the return, you will need to log into Real Me. After logging in you should select “Complete a regulatory return” and enter the FSPR number of the entity the return is being completed for. Please follow the instructions included in the form to complete the return, you may save and come back to the form at any time.
If you have any questions on completing the new form, any questions, please contact the FMA on [email protected].
Notifying the FMA
Licensee obligations include notifying the FMA of certain events and providing us with information. All notifications should be emailed to [email protected], noting the relevant obligation in the subject line of your email.