Financial Markets (Conduct of Institutions) Amendment Bill

Hon Kris Faafoi

Financial Markets (Conduct of Institutions) Amendment Bill

Government Bill

203—2

Contents

Commentary
Key
1Title
2Commencement
Part 1
Amendments to Financial Markets Conduct Act 2013
3Principal Act
4Section 6 amended (Interpretation)
5Section 386 amended (Overview)
6Section 388 amended (When provider of market services needs to be licensed)
6ASection 389 amended (Exemptions from need for market services licence)
7Section 403 amended (When FMA may impose permitted conditions)
8New section 409A inserted (Restriction on suspending or cancelling licence to act as financial institution)
409ARestriction on suspending or cancelling licence to act as financial institution
9New subpart 6A of Part 6 inserted
Subpart 6A—Regulating conduct of financial institutions
446AOverview
Fair conduct principle
446BWhat is the fair conduct principle
446CWhen fair conduct principle applies
Key definitions
446DMeaning of financial institution
446EMeaning of intermediary
446FMeaning of relevant service and associated product
Fundamental duties to meet fair conduct principle
446GDuty to establish, implement, and maintain effective fair conduct programme
446HDuty to make fair conduct programme available
446HFinancial institution must provide copy of programme to FMA
446HADuty to make information about fair conduct programme publicly available
446IDuty to comply with fair conduct programme
446IDuty to comply with fair conduct programme
446JFair conduct programme does not apply to other financial institutions acting as intermediaries
446KDuty to ensure intermediaries comply with fair conduct programme
446LDuty to ensure intermediary’s compliance does not apply in relation to financial advice providers or other financial institutions
446MMinimum requirements for fair conduct programme
Duties relating to incentives regulations
446NFinancial institution must comply with incentives regulations
446OIntermediary must comply with incentives regulations
446PMeaning of incentive
Miscellaneous provisions
446QFMA must obtain consent of Commerce Commission before commencing certain proceedings
446RPecuniary penalty order may not be made if failure relates only to certain legal obligations
446SOther definitions used in subpart
446TProtection of person who reports contravention or failure to comply
446UPresumption relating to consumer insurance contract
446VEffect of certificate from policyholder or client
446WRevocation of certification
446XReview of subpart and licensing requirement for financial institutions
10Section 449 amended (Part 6 services provisions)
10ASection 468 amended (When FMA may make direction orders)
11Section 489 amended (When court may make pecuniary penalty orders)
12Section 498 amended (Terms of other civil liability orders)
13Section 499 amended (General defences for person in contravention)
14Section 506 replaced (Only 1 pecuniary penalty order may be made for same conduct)
506Only 1 pecuniary penalty may be imposed for same conduct
15Section 507 amended (No pecuniary penalty and fine for same conduct)
16Section 546 amended (Regulations for purposes of Part 6 (market services))
17Section 550 amended (Procedural requirements for regulations relating to exemptions, exclusions, and definitions)
18New Part inserted in Schedule 4
Part 2
Other amendments
Subpart 1—Amendment to Credit Contracts and Consumer Finance Act 2003
19Amendment to Credit Contracts and Consumer Finance Act 2003
20New section 113A inserted (Sharing of information and documents with Financial Markets Authority)
113ASharing of information and documents with Financial Markets Authority
Subpart 2—Consequential amendments
21Consequential amendments to other enactments
Schedule 1
New Part inserted into Schedule 4
Schedule 2
Consequential amendments
Legislative history

The Parliament of New Zealand enacts as follows: