New Zealand Legislation: Regulations
Regulations are laws made under Acts
The exemptions in clause 5 are subject to the conditions that—
(a) subscribers for specified securities have, before subscription, received from the developer a copy of each of the following documents:
(i) the rules and any agreement for the management of the Society's affairs:
(ii) a specimen of all deeds or agreements providing for the transfer of communal facilities from the developer to the Society or for the lease or license of communal facilities by the Society:
(iii) a specimen of the sale agreement:
(iv) a specimen of all material instruments that will be executed by subscribers for specified securities, deeds, or agreements that contain provisions concerning the rights and obligations referred to in paragraph (b)(iii):
(v) a copy of the lease agreement; and
(b) subscribers for specified securities have, before subscription, received from the developer a document that sets out—
(i) a description of the areas of land that make up the development:
(ii) a description of the communal facilities that are intended to be owned, leased, licensed, maintained, administered, or operated in whole or in part by the Society at the completion of the development:
(iii) a description of the rights and obligations of members of the Society in relation to the communal facilities and the specified securities:
(iv) a description of the voting rights of the subscriber, as a member of the Society, in respect of the specified securities (including a statement as to whether the rules provide for voting by classes of members, or by a representative, in relation to particular matters); and
(c) if the developer represents or agrees that the development will be completed in stages, subscribers for specified securities have, before subscription, received from the developer a document that sets out,—
(i) for each stage of the development, the intended communal facilities and when those facilities are intended to be transferred, leased, or licensed to, or completed or constructed by or for, or procured by, the Society; and
(ii) the material risks of those communal facilities not being transferred, leased, or licensed to, or completed or constructed by or for, or procured by, the Society at each stage; and
(iii) a statement as to what stage the development is at, or expected to be at, at the end of each calendar year within the period beginning on the date of commencement of the development and ending on the estimated date of the completion of the development; and
(d) subscribers for specified securities have, before subscription, received from the developer a statement of levies, fees, or charges that are estimated to be, or were, payable by members of the Society in relation to the development and the developed properties for each calendar year in the period beginning on the date of commencement of the development and ending on the estimated date of the completion of the development that—
(i) comprises estimates, historical data, or both; and
(ii) is itemised in relation to each of the different communal facilities; and
(iii) contains a statement as to whether the levies, fees, or charges payable are fixed, variable, or based on the capital value of the developed property; and
(iv) contains, if a levy, fee, or charge is variable, a statement of the factors that influence how the levy, fee, or charge can vary; and
(v) contains, if a levy, fee, or charge is based on the capital value of a developed property, a statement of a formula by which the levy, fee, or charge can be calculated, together with a worked example; and
(vi) contains a statement of the principal assumptions on which any estimates are based; and
(vii) contains a statement as to whether the estimates have been reviewed by an independent third party acting in his or her professional capacity or consist only of the expression of an opinion of the developer; and
(e) subscribers for specified securities have, before subscription, received from the developer a document that sets out,—
(i) in summary, the main terms of the agreement for the lease of the farm park, including the term of the lease and the expected annual earnings from that lease; and
(ii) the material risks associated with that lease, including the risk of the lease not being renewed at the end of its term; and
(iii) the effect of a reduction in rental income on the fees and levies payable by members, and on the communal facilities and services provided to members by the Society; and
(f) it is a term of the offer that the rules provide that the specified securities may be subscribed for by entering into an agreement to purchase a developed property; and
(g) it is a term of the offer that the rules provide that only an owner of a developed property or an incorporation member may be a member of the Society; and
(h) it is a term of the offer that the rules provide that incorporation members may continue as members of the Society only for so long as is reasonably necessary to satisfy the membership requirements of the Incorporated Societies Act 1908 but, in any event, must cease to be members of the Society on or before the sale of the last developed property by the developer; and
(i) it is a term of the offer that the rules provide that every owner of a developed property is entitled to be a member of the Society; and
(j) deposit moneys paid by a subscriber for specified securities are held in any of the following trust accounts until the sale agreement becomes unconditional:
(i) a nominated trust account operated by a lawyer, an incorporated law firm, a conveyancing practitioner, or an incorporated conveyancing firm under the Lawyers and Conveyancers Act 2006; or
(ii) a trust account operated by a real estate agent under the Real Estate Agents Act 1976; or
(iii) a trust account operated by a trustee company under the Trustee Companies Act 1967; and
(k) no settlement of a sale agreement is completed until,—
(i) if the developer represents or agrees that certain communal facilities will be owned, leased, or licensed by the Society at the time of settlement of the sale agreement, those communal facilities are owned, leased, or licensed in accordance with that representation or agreement; and
(ii) if any interest in land is included in the communal facilities to be owned or leased by the Society at the time of settlement of the sale agreement, that interest is registered on the computer register for that land at that time; and
(iii) if the developer represents or agrees that certain communal facilities will be completed or constructed by or for, or procured by, the Society at the time of settlement of the sale agreement, those communal facilities have been completed, constructed, or procured in accordance with that representation or agreement; and
(l) in respect of any communal facility that the developer represents or agrees will be owned, leased, or licensed by the Society at the completion of a certain stage of the development or at the completion of the development, it is a term of the offer that—
(i) a deed of transfer, lease, or licence for that communal facility has been executed in favour of the Society; and
(ii) in respect of a communal facility that is an interest or estate in land, the transfer or lease is registered immediately after the subdivision of the land and the issue or creation of a separate computer register for an estate in fee simple or leasehold in respect of the land on which the communal facilities are to be located; and
(iii) the deed of transfer, lease, or licence has been provided to the Society; and
(m) if the development is advertised on the basis that the Society will own, lease, license, maintain, administer, or operate certain communal facilities in whole or in part at the completion of certain stages of the development or at the completion of the development, it is a term of the offer that the Society owns, leases, licenses, maintains, administers, or operates those communal facilities in whole or in part at the completion of those stages or at the completion of the development (as the case may be); and
(n) it is a term of the offer that if a representation or agreement is made by the developer to the effect that the developer or an associated person of the developer will make a contribution or payment to the Society for the purposes of the Society's activities,—
(i) a deed has been executed to this effect in favour of the Society; and
(ii) the deed has been provided to the Society; and
(o) if communal facilities that are estates or interests in land are leased, or to be leased, by the Society, the fee simple estate in those communal facilities are, or will be, owned by all of the members of the Society; and
(p) it is a term of the offer that the rules provide that the Society is only permitted to carry on 1 or more of the following activities:
(i) owning, leasing, licensing, maintaining, administering, or operating the communal facilities:
(ii) issuing licences to members of the Society that confer rights on those members to use the communal facilities, and administering and enforcing those licences in accordance with the rules:
(iii) owning, leasing, licensing, maintaining, administering, or operating land outside of the development if the Society is required to own, lease, license, maintain, administer, or operate that land in accordance with a resource consent for the development:
(iv) managing and administering the Society and administering and enforcing the rules:
(v) administering and enforcing a scheme for the regulation and control of matters relating to the use, repair, decoration, and landscaping of, and provision of services to, developed properties:
(vi) providing and maintaining services, utilities, facilities, and benefits to developed properties or for the development:
(vii) leasing the farm park on terms set out in the lease agreement:
(viii) any incidental activities that the Society considers are beneficial for members of the Society; and
(q) it is a term of the offer that the rules provide that—
(i) all moneys paid to the Society by its members are applied only for 1 or more of the activities referred to in paragraph (p); and
(ii) all moneys paid to the Society in respect of a lease of the farm park are applied only for 1 or more of the activities referred to in paragraph (p); and
(iii) members of the Society have the right to use the communal facilities in accordance with the rules; and
(iv) members of the Society have the right to vote at meetings of members of the Society; and
(v) on a liquidation of the Society, each member of the Society has the right to share pro rata with all other members of the Society in a distribution of any surplus assets of the Society; and
(vi) levies, fees, or charges payable to the Society by its members are determined only by a resolution of the members, or of a committee of the members, passed in accordance with the rules; and
(vii) the Society provides to a prospective purchaser of a developed property, within 5 working days after receiving a request, a copy of the most recent financial statements of the Society; and
(viii) financial statements of the Society complying with the Financial Reporting Act 1993 are audited annually and are distributed to members of the Society as soon as is reasonably practicable after each audit is completed and, in any event, no later than 5 months after the balance date of the Society; and
(r) the Society does not have as objects—
(i) the carrying on of trading activities; or
(ii) the carrying on of business for profit, except to the extent that the Society may lease the farm park on terms set out in the lease agreement.