Equity or debt issuers
Issuers are involved in first making a financial product available. See Section 11 of the FMC Act. They include:
Issuers have a number of obligations depending on the type of issue or offer. For more information on offers, please see offers under the FMC Act.
We offer a pre-registration review service to help issuers and their directors feel more confident that their offer documents are likely to satisfy our expectations. We focus on reviewing new, novel and complex offers.
To get your pre-registration review underway please contact us at compliance@fma.govt.nz (ensure you insert "PDS HELP" in your subject line) or call us on 0800 434 566 (+64 3 962 2698 for overseas callers).
Schedule 1 of the FMC Act sets out a series of statutory exclusions where lighter compliance paths are appropriate.
We have developed an information sheet for brokers, issuers and research providers to encourage wider publication of research on IPOs for retail clients.
It clarifies that under NZ law there are no required black-out periods and that the FMC Act has a more flexible regime for retail advertising. It also provides examples of the typical controls we expect investment banking firms to have in place to manage conflicts of interest.
Download Research reports for IPOs under the FMCA 2013 Information Sheet PDF, 395KB.
These obligations vary depending upon the type of issuer or offer, but generally include:
As an FMC reporting entity, you must do all of the following:
If you are an FMC reporting entity at any point during an accounting period, you are required to comply with these requirements for the full accounting period.
This handbook assists directors, executives and advisers of non-listed and public-sector companies, and other entities, to apply corporate governance principles to their particular entity. The principles do not impose any new legal obligations, and reporting against them is voluntary. However, the principles do set out standards for corporate governance that we believe directors and executives should apply, and report on, to their investors, shareholders and stakeholders.
Download Corporate governance in New Zealand - Principles and guidelines PDF, 320KB.
This information sheet goes into detail around how to:
Download the Reporting Duties under Part 4 of the FMA Act Information sheet PDF, 780KB.
A listed issuer is one who is party to a listing agreement with a licensed market operator for a licensed market.
Listed issuers must comply with the listing rules of the relevant licensed market, as set by the licensed market operator. These issuers, and certain persons related to them, also have ongoing disclosure obligations.
The FMC Act encourages and expects increased supervisor interaction. The FMC Act supports this through the accountability and reporting framework it establishes. On an ongoing basis, your supervisor has a requirement to engage and monitor you more actively. You also have obligations to engage and interact effectively and collaboratively with your supervisor. We expect you to work effectively with your supervisor to ensure governing documents are effective and fit for purpose.
Your supervisor is your ‘front line’ compliance supervision relationship. This means you will first need to address issues raised by your supervisor directly with them, not with FMA. Your supervisor may seek our involvement if necessary or desirable. We will have an increased focus on working with and through your supervisor in the first instance wherever appropriate, rather than directly with you. In some circumstances, it may be appropriate for us to engage directly with you and in those cases, we will keep your supervisor informed.
Normally if you want to borrow money direct from the public, the FMC Act requires you to issue a product disclosure statement (PDS).
Under exemptions in financial markets law:
The FMC Act sets out minimum compliance standards of behaviour for people operating in the financial markets.
It prohibits:
The Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (the Act) imposes several obligations:
The FMA supervises designated business groups (DBGs) and reporting entities listed in Section 130 of the Act.
Read more about the Anti-Money Laundering and Countering Financing of Terrorism Act AML/CFT.
The FMC Act offer regime is simpler and more efficient than the previous Securities Act regime. Most issuers and offerors will be able to make offers under either:
Issuers who are not an FMC reporting entity may be exempt from certain reporting obligation. See below:
If an issuer making a regulated offer of equity securities that is a voting product is not an FMC reporting entity, if they have:
Instead, the obligations in the Companies Act 1993 apply.
Note:
There are exclusions under Schedule 1 of the FMC Act that allow some offers to be made without having to provide all the usual documentation required, ie product disclosure statements.
One of those exclusions is for small personal offers of debt and equity - see clause 12 of Schedule 1. It allows you to make small offers over a 12-month period that can, in total, involve up to 20 investors and raise up to $2 million without having to produce full documentation. Any offer that would result in you exceeding either or both those limits requires full documentation under part 3 of the FMC Act.
If, over several 12-month periods, you gain more than 50 shareholders from small offers, you'll become a FMC reporting entity.
Companies that raise capital through a licensed crowdfunding platform, relying on classe 6 of Schedule 1, are not considered FMC reporting entities. This is because the offer is not considered a ‘regulated offer’ under the FMC Act.
Instead, these companies will be subject to the financial reporting requirements under the Companies Act 1993.