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. S309 of the Financial Markets Conduct Act (the Act) sets out what is considered a financial product market and what is not.
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 the FMA. 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.
To ensure your application runs as smoothly as possible, make sure you understand what is required:
The application fee for a licence to operate a financial product market, vary an existing licence, or approve a market rule change is based on the amount of time spent on the application. This is charged at the FMA hourly rate.
For more information see the Financial Markets Conduct (Fees) Regulations 2014.
The Financial Markets Authority (Levies) Regulations 2012 (the Regulations), as amended in 2020, set out the levies payable by industry. The levies are set by the Ministry of Business, Innovation, and Employment (MBIE).
The FMA receives funding from the Crown and a proportion of our costs is recouped from industry through levies.
A financial markets participant falls within one or more levy ’class’, depending on what financial services they provide.
The table below (see levy class description) provides a high-level description of each levy class. For the full description of levy classes, see Schedule 2 in the Regulations.
The table below provides a high-level description of each levy class. For the full description of levy classes, see Schedule 2 in the Regulations.
Class | Description |
1 | Persons making an application for registration on the Financial Service Providers Register |
2 | Registered banks and licensed non-bank deposit takers |
3 | Licensed insurers |
4 | Licensed supervisors of debt securities and managed investment products in registered schemes |
5 | Managers (of registered schemes) |
6 | Persons who undertook trading activities on licensed markets, contributory mortgage brokers, trading financial products or foreign exchange on behalf of other persons (other than persons included in class 6A, 6B, 6C or 6D, authorised bodies that only provide the service under a market services licence held by a person in class 6A or 6D and DIMS wholesale providers) or licensed derivatives issuers |
6A | Licensed discretionary investment management service (DIMS) retail providers |
6B | Providers of a regulated client money or property service (as defined in section 6(1) of the FMC Act) other than persons included in class 6(a) or 6C |
6C | Custodians and persons providing custodial services |
6D | Crowdfunding service providers and peer-to-peer lending service providers |
6E | Licensed financial benchmark administrators |
6F | Authorised bodies |
6G | Financial advisers |
6H | Licensed financial advice providers |
7 | All other financial service providers that are not included in any of classes 2 – 6H |
8 | Listed issuers (other than persons included in class 8A) |
8A | Small listed issuers |
9 | Lodgement of a product disclosure statement (PDS) |
10 | Licensed market operators |
10A | Licensed market operators that operate growth markets (other than persons included in class 10) |
11 | FMC reporting entities that lodge financial statements (or group financial statements) and auditor’s reports |
12 | Accredited bodies |
13 | Licensed overseas auditors |
14 | Persons that apply for registration or incorporation under the Building Societies Act 1965; the Companies Act 1993; the Friendly Societies and Credit Unions Act 1982; or the Limited Partnerships Act 2008 |
15 | Persons that are registered or incorporated and required to make annual returns under the Building Societies Act 1965; the Companies Act 1993; the Friendly Societies and Credit Unions Act 1982; or the Limited Partnerships Act 2008 |
It is the responsibility of each financial service provider to ensure they are registered for the service(s) they provide and have paid the appropriate levies. As part of their online annual confirmation to the Registrar, they must select all of the applicable classes to determine the levies payable and confirm the information they have provided is true, correct and complete.
Under the Financial Service Providers (Registration and Dispute Resolution) Act 2008 (the FSP Act) it is an offence to:
These offences could result in a fine of up to $100,000 and/or imprisonment for individuals, and a fine of up to $300,000 for businesses.
It is also an offence under the FSP Act to fail to notify the Registrar if any of the details contained on the FSPR are no longer correct. Failure to notify could result in a fine of up to $10,000.
We have discretionary power to waive a levy (in whole or part).
We will only do so if we are satisfied that the circumstances or characteristics of the financial markets participant are exceptional when compared with the circumstances or characteristics of others in the same class, so that it would make it inequitable for the person to pay the levy. The threshold is deliberately high.
The waiver power is not intended to be used to revisit settled policy positions.
Once we receive a waiver application and the fee, we will assess it. If we decide to grant the waiver, we must notify our decision in the Gazette, and publish the decision and reasons for it on our website.
You will need to email the following information to compliance@fma.govt.nz with the subject line ‘Levy waiver application’.
How to pay your waiver application fee
You can pay by electronic deposit or internet banking. Payment can be made by applicants or law firms making applications on behalf of their clients.
The person paying the application fee must be the person who pays the subsequent fees and costs. For example, if a law firm pays the application fee, that law firm must also pay any additional fees and costs.
We recommend if law firms apply for waivers on behalf of their clients, the parties discuss and agree who will be responsible for paying the FMA’s fees before submitting a waiver application.
Payment option | How to pay | Additional information |
Electronic deposit or internet banking | Where bill pay is available please select ‘Financial Markets Authority - Other' Otherwise, our bank details are: Bank: Westpac Account name: Financial Markets Authority Account number: 03-0584-0198005-000 |
To ensure we process your payment correctly please provide the following information: Particulars: Payer’s name* Code: Waiver Reference: Applicant’s name You do not need to forward a hard copy of your application if paying electronically |
* This is the name of the person paying the application fee. This person will be invoiced for any subsequent fees and costs. Payment by credit card is not available for this application process.
What are the fees
How long does it take
As a market operator, you must make sure your licensed markets operate in a fair, orderly and transparent way (s314), and have arrangements in place for the following:
You must also ensure you have the resources required to operate your markets properly, and you are able to continue to meet any conditions of your licence.
Each year the FMA undertakes a review of how well NZX has complied with each of its statutory obligations during the review period. We are also required to report periodically on how well other market operators are meeting their licensed market operator obligations. See all the NZX reports, ASX 24 reports, Ice Futures Europe reports, and Ice Futures US reports.