Financial Services Legislation Amendment Act 2019

Coat of Arms of New Zealand

Financial Services Legislation Amendment Act 2019

Public Act
 
2019 No 8
Date of assent
 
8 April 2019
Commencement
 
see section 2

Contents

1Title
2Commencement
3Principal Act
4Section 5 amended (Overview)
5Section 6 amended (Interpretation)
6Section 8 amended (Definitions relating to kinds of financial products)
7Section 9 amended (Definitions of financial benefit and of managed investment scheme)
8New section 14A and cross-heading inserted
14ATransitional, savings, and related provisions
9Section 18 amended (Interpretation in this Part)
10Section 28 amended (Certain conduct does not contravene various provisions)
11Section 34 amended (Prohibition of offers in course of unsolicited meetings with persons acting otherwise than in trade)
12Section 351 amended (Regulations modifying this Part or Part 7 for licensed markets)
13Section 386 amended (Overview)
14Section 387 amended (Territorial scope for licensing of certain market services)
15New section 387A inserted (Other provisions relating to financial advice services and client money or property services)
387AOther provisions relating to financial advice services and client money or property services
16Section 388 amended (When provider of market services needs to be licensed)
17Section 389 amended (Exemptions from need for market services licence)
18Section 392 repealed (Meaning of discretionary investment management service and related terms)
19Section 393 amended (Principles guiding the exercise of FMA powers)
20Section 395 amended (Application for licence)
21Section 397 amended (Procedural requirements)
22Section 398 amended (Notice of decision)
23Section 400 amended (Licence may cover related bodies corporate as authorised bodies)
24Section 403 amended (When FMA may impose permitted conditions)
25New section 406A inserted (Effect of condition requiring giver of advice or interposed person to be authorised by licence or registered)
406AEffect of condition requiring giver of advice or interposed person to be authorised by licence or registered
26Section 410 amended (Meaning of material change of circumstances)
27Section 414 amended (FMA’s powers in case of contravention of market services licensee obligation, material change, etc)
28Section 426 amended (Disclosure statement)
29New subparts 5A and 5B of Part 6 inserted
431AOverview of financial advice and financial advice services regime
431BAdditional purpose of subpart
431CMeaning of financial advice and regulated financial advice
431DWhen financial advice service is provided
431EMeaning of engaged
431FLimitation on who can give regulated financial advice to retail clients on behalf of financial advice provider
431GProhibitions on holding out in relation to giving financial advice
431HLiability for duties
431IDuty to meet standards of competence, knowledge, and skill
431JDuty to ensure client understands nature and scope of advice
431KDuty to give priority to client’s interests
431LDuty to exercise care, diligence, and skill
431MDuty to comply with code of conduct
431NDuty relating to offer that contravenes Act or regulations
431ODuty to make prescribed information available
431PFalse or misleading statements and omissions
431QPersons engaging others to give advice must ensure compliance with duties
431RDuties of persons who engage nominated representatives
431SProtection of individual who reports breach
431TNomination of nominated representatives
431ULimitation on pecuniary penalty orders against financial advice providers
431VOverview of client money or property services regime
431WMeaning of client money or property service and certain other terms
431XProvider must make disclosure before receiving client money or client property from retail client
431YFalse or misleading statements and omissions
431ZApplication of conduct obligations
431ZAProvider must exercise care, diligence, and skill
431ZBProvider must not receive client money if offer contravenes Act or regulations
431ZCProvider must pay client money into separate trust account and hold client property on trust
431ZDProvider must account for client money and client property
431ZEProvider must keep records of client money and client property
431ZFProvider must report on client money and client property
431ZGRestrictions on use of client money and client property
431ZHProtection of client money and client property held on trust
431ZIWho is responsible for obligations
30New section 432A inserted (Meaning of discretionary investment management service and related terms)
432AMeaning of discretionary investment management service and related terms
31Section 446 replaced (Certain broker obligations of Financial Advisers Act 2008 may be enforced also under this Act)
446Certain client money or property service obligations under subpart 5B apply
32Section 449 amended (Part 6 services provisions)
33Section 451 amended (Meaning of FMC reporting entity)
34Section 452 amended (Company that issues equity securities not FMC reporting entity if fewer than 50 shareholders)
35Section 462 amended (When FMA may make stop orders)
36Section 469 amended (Terms of direction orders)
37Section 475 amended (FMA must follow steps before making orders)
38Section 489 amended (When court may make pecuniary penalty orders)
39Section 499 amended (General defences for person in contravention)
40Section 500 amended (Disclosure defences for person in contravention)
41Section 501 amended (Additional disclosure or financial reporting defence for directors who are treated as contravening)
42Section 503 amended (General defences for person involved in contravention)
43Section 507 amended (No pecuniary penalty and fine for same conduct)
44Section 511 amended (Offence of knowingly or recklessly contravening other provisions relating to defective disclosure)
45Section 518 amended (Terms of banning orders)
46New sections 532A to 532C inserted
532AAppeals against decisions of disciplinary committee
532BOrders as to publication of names
532CAppeal on question of law
47Section 543 amended (Regulations for purposes of Part 3 (Disclosure of offers of financial products))
48Section 546 amended (Regulations for purposes of Part 6 (market services))
49Section 548 amended (Other regulations)
50Section 550 amended (Procedural requirements for regulations relating to exemptions, exclusions, and definitions)
51Section 562 amended (FMA’s designation power)
52Section 563 amended (Procedural requirements)
53New section 571A inserted (Deferral of obligations to publish, notify, and make available non-class exemptions)
571ADeferral of obligations to publish, notify, and make available non-class exemptions
54Heading to subpart 8 of Part 9 amended
55Section 597 repealed (Transitional provisions)
56Schedule 1 amended
57Schedule 2 amended
58Schedule 3 amended
59Schedule 4 amended
60New Schedule 5 inserted
61Principal Act
62Section 4 amended (Interpretation)
63Section 5 amended (Meaning of financial service)
64Section 6 amended (Meaning of in the business of providing a financial service)
65Section 7 amended (Application of Act)
66New section 7A inserted (Application of Act)
7AApplication of Act
67Section 8A replaced (Territorial scope)
8ATransitional, savings, and related provisions
68Section 10 amended (Registration and deregistration)
69Heading to subpart 1 of Part 2 replaced
70Section 11 amended (No being in business of providing financial service unless registered and member of approved dispute resolution scheme)
71Section 12 amended (No holding out that in business of providing financial service unless registered and member of approved dispute resolution scheme)
72New section 12A inserted (Registration for certain overlapping services not required)
12ARegistration for certain overlapping services not required
73Section 14 amended (Disqualified person)
74Section 15 amended (Application to be registered as financial service provider)
75Section 16 amended (Registration of financial service provider)
76Section 17 amended (Duty to notify changes relating to financial service provider)
77Section 18 amended (Deregistration of financial service provider)
78Section 20 amended (Objection to proposed deregistration of financial service provider)
79Section 21 amended (Notification of deregistration of financial service provider)
80Section 22 amended (Reregistration of financial service provider)
81New sections 22A to 22D and cross-headings inserted
22ARegistrar must not reregister financial adviser if direction has been made
22BSuspension of registration
22CRegistration of financial advisers
22DFinancial adviser may be deregistered if not engaged by provider for extended period
82Section 26 amended (Purposes of register)
83Section 27 amended (Contents of register)
84Section 29 amended (Registrar must amend register in certain circumstances)
85Section 34 amended (Sharing information with other persons or bodies)
86Section 37 amended (Registrar’s inspection powers)
87Section 42 amended (Appeals from Registrar’s decisions and FMA directions)
88Section 44 amended (Regulations under Part 1 and this Part)
89New sections 44A and 44B inserted
44AWho financial adviser is treated as engaged by when engaged indirectly
44BFMA acts as licensing authority in relation to operators of financial product markets
90Section 48 amended (Financial service provider must be member of dispute resolution scheme)
91New section 48A inserted (When financial adviser is exempt from being member)
48AWhen financial adviser is exempt from being member
92Section 49 amended (Who are retail clients)
93Section 67 replaced (Duty to co-operate and communicate information in certain circumstances)
67Duty to co-operate and communicate information in certain circumstances
94Section 79 amended (Regulations under this Part)
95New Schedule 1AA inserted
96Schedule 2 amended
97Repeals and revocations
98Consequential amendments
Legislative history
Administrative information

The Parliament of New Zealand enacts as follows: