The Financial Markets Conduct Act's implementation, by Eugene Duhovnikoff BA/LLB

The New Zealand Government has decided to implement its new  Financial Markets Conduct Act 2013 in two phases. While the second phases is will be brought in to force in December 2014 the first phase entered force on the 1st of April 2014.

What has changed:

  1. There are some new mechanisms in place to facilitate smaller fundraising initiatives including peer-to-peer landing;
  2. There is a mew “small offers” regime which has the reduced disclosure requirements for offers made under employee share schemes;
  3. Akin to the “cleansing notice regime” which is in place in Australia the listed issuers are now able to conduct rights issues through market announcements instead of simplified disclosure prospectuses.

What to expect from the second phase:

  1. An introduction of the separate trust account obligations for brokers, prohibiting them from placing “buffers” of broker funds in client money trust accounts;
  2. A new regime of disclosure requirements for offers of securities; 
  3. A new “Product Disclosure Statement” model; and
  4. A new online offer registers.



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Reeves/Duhovnikoff & Associates Ltd. 2017