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  3. Consultation on expiring class legislative notices

Consultation on expiring class legislative notices

Page last updated: 10 Jul 2020

Throughout 2020 and 2021 we will be consulting on a range of class exemption and other legislative notices that are due to expire before the end of 2022. This page will be updated as new consultations are published, or you can subscribe to our updates to receive email alerts about new consultations.

Current consultations

The following notices that support the regime under the Financial Markets Conduct Act 2013:

  1. Employee share purchase schemes
  2. Licensed independent trustees of restricted schemes
  3. Overseas subsidiary balance date alignment
  4. Communal facilities in real property developments
  5. Equine bloodstock
  6. Forestry schemes
  7. Property schemes – custody of assets
  8. Employee share purchase schemes shares offered under Securities Act 1978
  9. Small co-operatives
  10. Disclosure using overseas GAAP
  11. Overseas FMC reporting entities
  12. Overseas registered banks and licensed insurers
  13. Incidental offers
  14. Recognised exchanges
  15. Securities Offered under Securities Act 1978 Exemptions Recognising Overseas Regimes
  16. Overseas Banks offering simple debt products 
Related documents

Download the consultation document

Download the submission form

Submissions close Thursday 20 August 2020
Make a submission Email consultation@fma.govt.nz

 

Review of 16 FMC Act class exemption notices

9 July 2020

We are seeking feedback on our review of 16 class exemption notices that support the regime under the Financial Markets Conduct Act 2013 (FMC Act). These notices (listed above) will expire between August and December 2021.

We would like feedback on these class notices. We invite your comments on the matters discussed in this paper. Please use the feedback form provided. Your feedback will help inform our view of whether to renew these notices and, if so, whether any amendments may be needed.

Proposed extensions for three class exemption notices supporting the Financial Advisers Act regime

9 July 2020

After carefully considering the submissions, the FMA has agreed in principle to approve the extension of the FA Act exemptions for Non-NZX brokers and NZX brokers, subject to certain conditions, from the requirement to hold client money and property separately from firm money.  

FMA has also agreed to approve an extension of the FMC Act exemption relating to offers of financial products made through AFAs who are providing DIMS. The notice exempts the offer from the disclosure requirements in Part 3 of the FMC Act and provides that exempted offers are not considered to be regulated offers.

We are currently drafting the exemption notices that will give effect to these decisions and our intention is to have the notices in place by September 2020.  It is proposed that these exemptions will continue until the new financial advice regime legislative changes in the FSLAA have been brought fully into effect on 15 March 2021. 

We would like to thank everyone for their feedback and engagement.

22 May 2020

Consultation on notices supporting the Financial Advisers Act regime is now closed. Our response on the proposed extensions is pending.

The Government has announced that the start of the new financial advice regime will be delayed as a result of the impact of the COVID-19 outbreak. The start date is now 15 March 2021. As the Financial Advisors Act 2008 will continue until the start date for the new regime, we are proposing to continue the exemptions under the following notices (that are due to expire in November this year) up until the start of the new regime:

Financial Advisers (Non-NZX Brokers – Client Money) Exemption Notice 2017
This notice exempts non-NZX brokers, subject to certain conditions, from the requirement to hold client money and property separately from firm money. This allows firms to hold a buffer of firm money in the client money trust account where it is reasonably necessary to reduce the risk of client money shortfalls. New regulations under the new financial advice regime are expected to allow brokers to hold firm money or property together with client money or property in certain circumstances, such as to reduce the risk of the client account being overdrawn due to delays processing payments. We do not expect continued exemption relief will be required once the new regime commences.

Financial Advisers (NZX Brokers – Client Money and Client Property) Exemption Notice 2015
This notice exempts NZX brokers, subject to certain conditions from the requirement to hold client money and property separately from firm money. The exemption permits the operation of gateway accounts for transacting with particular settlement systems. It also allows NZX participants to keep a limited buffer of firm money in their client account where it is reasonably necessary to reduce the risk of temporary client money shortfalls or facilitate settlements in a prudent or orderly fashion. As noted above, regulations under the new regime are expected to allow brokers to hold firm money or property together with client money or property in certain circumstances. We do not expect continued exemption relief will be required once the new regime commences.

Financial Markets Conduct (Offers of Financial Products Through Authorised Financial Advisers Supplying Personalised DIMS) Exemption Notice 2015
This notice applies to offers of financial products made through authorised financial advisers (AFAs) who are providing personalised discretionary investment management services (DIMS). It exempts the offer from the disclosure requirements in Part 3 of the FMC Act and provides that exempted offers are not considered to be regulated offers. The effect is to put offers made through these AFAs in the same position as offers made through DIMS licensees under Part 6 of the FMC Act, that benefit from a Schedule 1 exclusion. We do not expect continued exemption relief will be required once the new regime commences. AFAs providing personalised DIMS will be deemed to hold a DIMS licence under Part 6 on commencement of that regime (unless they opt out).