2 November, 2012
Commerce Minister Craig Foss today welcomed the introduction of new regulations to help rein in unsolicited 'predatory' share offers.
"Predatory or low ball offers damage the health of our capital markets," says Mr Foss.
Lowball offers are unsolicited approaches to shareholders offering to buy their shares or other securities. The offer letters put pressure on people to sell their shares quickly, often with little information and using unconventional business practices.
"The new regulations govern how unsolicited offers can be made and protect shareholders from misleading offers," says Mr Foss.
A person who does not comply with an order made by the Financial Markets Authority commits an offence and is liable on summary conviction to a fine not exceeding $30,000.
"The new regulations will require greater disclosure requirements from the person or company that makes an offer, and ensure stronger rights and remedies for shareholders," says Mr Foss.
The new regulations include:
The regulations come into force on 1 December 2012 and can be found at http://www.legislation.govt.nz/regulation/public/2012/0331/latest/DLM4817557.html