Anyone operating a financial product market needs to be licenced unless the market is exempt. A financial product market is a facility where financial products are bought or sold, or where offers or invitations to buy or sell financial products are made.
See s309 of the FMC Act (Act) for the definition of what is, and what is not, considered a facility, and s312 for more on exemptions from the licensing requirements.
The Minister of Commerce and Consumer Affairs issues financial product market licences, with advice from us. The Minister and the FMA must consider the following before issuing a licence to a financial product market operator:
The Minister must also be satisfied that an applicant will be able to meet the general obligations of licensed market operators, found in s314 of the Act, and is a body corporate registered on the FSPR.
A market operator must not operate markets that are not specified in a licence, but a licence may cover more than one financial product market.
The standard conditions for a licence include:
The Minister may also place other conditions on the licence. The market operator can subsequently request changes to the conditions of its licence, or the Minister may vary the conditions on his or her own initiative.
A licence may be suspended or cancelled under certain circumstances, set out in s323 of the Act.
A person who wants a licence to operate a financial product market should apply to us in writing. You can contact us, either by email fmcapplications@fma.govt.nz or phone 0800 434 566. We will assess your application and ensure you have provided all relevant information, before giving the Minister advice about the application, which we must do within a reasonable time.
The information included with your application should clearly demonstrate:
A financial product market licence may be issued if the Minister is satisfied that you will meet and comply with the general obligations of a licensed market operator (s314 of the Act), taking any proposed conditions of the licence into account. You must also be a body corporate and register on the FSPR.
For more information on the approval of market rules, see s327 to 336 of the Act.
The information we require to assess your application will vary depending on the features of the market, but should also include:
We will liaise with you to seek further information or clarification as required.