Offers under the FMC Act

The Financial Markest Conduct Act (FMC Act) offer regime is simpler and more efficient than the previous Securities Act regime. Most issuers and offerors will be able to make offers under either:

However in some cases businesses may encounter difficulties offering financial products under the FMC Act regime. In some circumstances exemptive relief from a regulatory or disclosure requirement may be appropriate. For example:

  • Instances where the standard offer information, or ongoing compliance, requirements are not effectively tailored for a unique financial product
  • Instances where specific information usually required in an offer document can’t be obtained, but alternative information that can be provided instead
  • Overseas issuers seeking to offer on the basis of an appropriate recognised foreign regime
  • Interests caught within the definition of financial products that are not financial products in the conventional sense such that the offer information requirements usually applying to financial products is not justified
  • Offers made in similar circumstances to offers under the Schedule 1 excluded offer regime, or an overseas recognition regime, which for technical reasons cannot rely on the statutory relief

For additional information about FMA exemptions click here.

If you think there may be a basis for relief from the standard regulated offers regime, and that is not provided for by a Schedule 1 exclusion, consider:

  • Can you rely on a current FMC Act exemption?
  • Are you interested in an FMC Act exemption already under consideration by the FMA?
  • Do you have a sound basis to apply for a new FMC Act exemption?

FMC Act exemptions in place

You can find information on FMC Act exemptions that have already been granted here.

FMC Act exemptions under consideration

Exemptions that may be required

The FMA is aware there are a number of issues that may arise for market participants operating under the FMC Act regime. Exemptions may be required in some cases so please see our Consultation section for more information.

In some cases, while the opportunity for submissions has closed, the FMA may still be in the process of finalising any exemptions determined appropriate.  In cases where you cannot see an update please call us if you are interested in the direction being taken, or position reached, on any matter.

Exemptions that are no longer required

Many of the technical difficulties participants encounter operating under the Securities Act regime are avoided or addressed by the FMC Act regime. Exemptions covering these difficulties will no longer be required.

Our table, Issues that no longer arise under the FMC Act regime, summarises why we believe new equivalent FMC Act exemptions are not required.

Businesses can continue to rely on these Securities Act exemptions, to the extent they still apply and have not expired, during the transition period for any offers made under the Securities Act regime. (Please note, regardless of the expiry date of these exemptions, all these exemptions become redundant at the end of the relevant transition period (30 November 2015 or 30 November 2016) because you will no longer be able to offer or manage securities under the Securities Act regime.)

Please contact us if you would like to discuss these exemptions.

Do you have a sound basis to apply for a new FMC Act exemption?

We have wide powers to exempt persons (or types of persons) or transactions (or types of transactions) from some requirements in the FMC Act and associated regulations. Any exemptions we grant must promote one or more of the purposes of the FMC Act regime:

  • confident and informed participation in financial markets
  • development of fair, efficient and transparent financial markets
  • to provide for timely, accurate, and understandable information to assist investment decisions
  • to ensure appropriate governance arrangements apply to financial products and services that allow for effective monitoring and reduce governance risks
  • to avoid unnecessary compliance costs
  • to promote innovation and flexibility in the financial markets Additionally the extent of the exemption must not be broader than necessary to address the matters than gave rise to it.

Additionally, the extent of the exemption must not be broader than necessary to address the matters than gave rise to it. 

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