New regulations for financial markets

The Government has decided on regulations needed to bring the Financial Markets Conduct (FMC) Bill into force, Commerce Minister Craig Foss announced today.

“These regulations are part of the most significant reform of financial market regulation in a generation. The FMC Bill is a key pillar in the Capital Markets work stream of the Government’s Business Growth Agenda. The Bill is aimed at increasing investment in our capital markets so our firms can grow.

“It is aimed at creating confident and informed investors and fair, efficient and transparent financial markets. These regulations will provide the detail needed to fully implement key aspects of the Bill,” says Mr Foss.

The regulations were the subject of public consultation and will be consulted on further before they are finalised in 2014.

The regulations include:

• how to make disclosure documents more useful and accessible to retail investors
• detail around the governance rules for managed funds such as KiwiSaver
• licensing criteria for fund managers, discretionary investment management services and derivatives issuers
• permitting new forms of capital raising, such as person-to-person lending services and crowd-funding platforms.

“Regulation needs to work for both issuers and investors. Investors must have accessible and useful information to make informed decisions and must be confident that their investments will be well-governed,” says Mr Foss.

To view the Cabinet papers outlining the proposed regulations, visit www.med.govt.nz/business/business-law/current-business-law-work/review-of-securities-law