Licensed crowdfunding service providers have a number of on-going obligations, in addition to the minimum standards and standard conditions set out in their licence.
Notifying the FMA
Licensees obligations include notifying the FMA of certain events and providing us with information. For example, you must notify us when a new director or senior manager is appointed by completing a declaration form.
All notifications should be emailed to the FMA at email@example.com, noting the relevant obligation in the subject line of your email.
Minimum licensing standards and conditions
To become a licensed crowdfunding service provider you'll have to meet and maintain certain minimum standards. The key standards in the Act (section 396) are mentioned below, see our licensing guide for more info.
Your directors and senior managers (current or proposed) must be fit and proper for their positions
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.
As a licensee, you'll also have a number of other important on-going obligations. For example, you must:
have a written client agreement with investors
have arrangements so investors get information to help with share buying decisions
monitor your compliance, identify material changes of circumstance, and meet reporting obligations.
Standard conditions for crowdfunding service licences
The licence is subject to a condition that the licensee or authorised body may, under the licence, provide only the market services or class of market services to which the licence relates and for which each person is authorised under the licence; and the conditions imposed by the FMA under section 403– these will generally include the standard conditions and/or any specific conditions; andthe conditions imposed by regulations (if any). Read more in the attached document.
Completing your annual regulatory return
Every licensed crowdfunding 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
focus our monitoring activities more effectively.
All licensees will need to submit their return to us by 31 August, for the 12 months to 30 June.
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.