Since its establishment in 2011, the Financial Markets Authority's (FMA) role, responsibilities and statutory functions have increased significantly. There have been previous reviews and funding increases, including in 2016 and in 2019/20. There are now three new regimes requiring new regulatory activities from the FMA:
- Conduct of Financial Institutions (COFI)
- Insurance Contract Law (ICL)
- Climate-Related Disclosures (CRD)
Ministry of Business, Innovation and Employment (MBIE) and the FMA are consulting on proposed changes to the FMA’s funding and the FMA levy. The funding review has been subject to a Deloitte independent assessment and Deloitte’s findings are published alongside the consultation materials on the MBIE website.
A summary of the three regimes is set out below.
- Conduct of Financial Institutions (CoFI) Regime: This regime will require all registered banks, licensed insurers and licensed non-bank deposit takers that provide relevant services and associated products to consumers to be licensed by the Financial Markets Authority. It will also require these institutions to have “fair conduct programmes” in place across their business that are designed to ensure compliance with a principle to treat consumers fairly.
- Insurance Contract Law (ICL) Regime: This regime will reform insurance contract law so that insurance better meets consumer and insurer expectations. This includes strengthening protections for consumers against unfair contract terms in insurance contracts and measures to assist consumers understanding of insurance policies.
- Climate-Related Disclosures Regime (CRD): This regime will make climate-related disclosures mandatory for affected reporting entities under the Financial Markets Conduct Act 2013.
What we are seeking feedback on:
The discussion document seeks feedback on:
- two different funding options under each of the CoFI, ICL and CRD regimes
- the approach to implementation of the CoFI regime, including the proposed licensing window and
- the options for recovering the FMA’s funding, including proposed changes to the FMA levies paid by financial market participants who are in the scope of the CoFI, ICL and CRD regimes.
The discussion document, submission report and Deloitte report can be viewed on the MBIE website.
MBIE has published the outcome of the 2021 review of the FMA’s funding and levies. More details can be found on the MBIE website.