FMA Update - 11 November 2015

Bringing it all together

Garth Stanish, director of the newly formed Capital Markets team, offers a glimpse of how the restructure will improve our support of the financial industry and investors.

The FMA has created a new Capital Markets team to make sure we are staying true to our main objective — to promote and encourage fair, efficient and transparent financial markets.

To help encourage capital market growth and support market integrity, we have decided to blend our primary, secondary and issuer disclosure teams. The new structure will have oversight of capital market conduct, market infrastructure (exchanges, platforms and clearing), disclosure and issuers, and auditor oversight. This will allow us to intensify our focus and use common skills to identify risks, diagnose problems and troubleshoot.

This consolidation is a positive step in our evolution. There won’t be a sea change in how we substantively consider capital market issues and nor will there be a change to specific areas of focus, such as the streamlining of capital raising, secondary market conduct, and tailoring regulation to reduce regulatory burden.

However, we will be more efficient in our responses. The old structure meant that firms with capital markets issues could find themselves dealing with people across three different teams. The new structure means there is better scope for us to support firms and improve the efficiency of regulation – which ultimately benefits investors.

As a result of the restructure, businesses can expect a deeper level of engagement with us. We often have to choose where to focus our efforts. In doing that, we will focus on activities that will make capital markets attractive to investors.

Garth Stanish
Director of Captial Markets, FMA

AFA renewals 

If you’re an AFA we encourage you to make a note of your authorisation expiry date before the pre-Christmas rush sets in.

We have published a renewal guide on our website and if you need to talk to someone about your application renewal, please email us at renewals@fma.govt.nz or call us on 0800 434 567 (+64 3 943 4222 for overseas callers).

QFE renewal guide published

We have published our renewal guide for QFEs on the QFE licensing forms and resources page of our website and will be publishing the application forms early next week.

We encourage QFEs to make a note of their expiry date and plan ahead for their renewal application.

Reminders 

20 November

Consultation closes – Code Committee’s consultation on the Code of Professional Conduct for Authorised Financial Advisers

27 November 

Consultation closes - Draft guidance on disclosure of certain fees and returns by managed funds

30 November

Offers under the Securities Act

Only continuous issuers and entities that did not require a prospectus as a result of an FMA exemption can continue to offer under the Securities Act.

Authorised Financial Advisers who are personalised DIMS providers

AFAs who are personalised DIMS providers must comply with their statutory annual reporting obligations, including sending notices to their clients describing the service and scope of investment authority.

1 December 2015

Derivatives issuers

All derivative issuers (including those under a transitional licence with disclosure conditions) must use an FMC PDS for regulated offers of derivatives.

Also, all derivatives issuers (including those with a transitional licence who have been complying with the Futures Industry (Client Funds) Regulations 1990), have to comply with the derivatives investor money and property provision in the FMC Regulations (Regulations 238-250).

Fraud Awareness Week 15-21 November

Scams are a growing international problem. As part of a global initiative, Fraud Awareness Week will help highlight the dangers of scams and how consumers can protect themselves. Throughout next week, we will be posting tips on our LinkedIn Investor Information page about what to look out for, and the steps investors can take to avoid becoming a victim.

More

Consultation

Have your say in shaping the future of New Zealand’s financial markets.

Open consultation

Draft guidance on disclosure of certain fees and returns by managed funds 

Closes Friday 27 November.

Upcoming consultation

Next week

Proposed annual declaration of compliance for FMC Act licensees

We are proposing to add a new standard condition that will require all FMC Act market service licensees to declare to us, on an annual basis, their compliance with each condition of their licence.

Proposed variations to standard conditions of market services licences

In seeking feedback on this consultation, we also consider that the largest potential impact is a reduction in the audit requirements on derivative issuers.  There are also amendments proposed to the financial resources conditions and minor changes to terminology or clarification amendments.

Late November

Recognition of overseas financial reporting and offers 

We are considering offering more relief for overseas issuers; recognising foreign financial statements and audit regimes, provided they meet certain standards.  

Forestry schemes

Our consultation paper will seek input on possible exemptions from some FMC Act obligations, with appropriate conditions. We are also asking for comments on our approach to licensing forestry schemes.

AFA guidance note archived

Old Code Standard 6 (d) – Analysis Before Recommendation

Code Standard 6(d) of the Code of Professional Conduct for AFAs  has been replaced by Code Standard 6(c).  

Our Guidance Notice on Code Standard 6(d) is not applicable to Code Standard 6(c) in the current Code of Professional Conduct, and has been archived.  A copy of the old guidance note is available on our website.

What’s coming up?

Mid November

  • Sales and advice report
  • Guidance note on risk indicators and descriptions of managed funds

December

Audit quality review report

FMA news

5 November  - FMA confirms Paul Gregory in the role of director of external communications and investor resources

27 October - SPG and SPGI director Andrew Robinson sentenced

16 October - FMA confirms new organisation structure and appointments to leadership team

 

Feedback?

Email us at communications@fma.govt.nz