Individuals and businesses who provide financial services must comply.
Registration of financial service providers
Financial service providers must be registered on the Financial Service Providers Register in order to legally conduct a financial services business. This is in addition to any other licences or authorisations they may be required to hold under other laws.
Financial service providers include financial advisers, brokers, building societies, credit providers, credit unions, money changers, finance companies, foreign currency exchange dealers, fund managers, insurers, investment portfolio managers, issuers and registered banks.
The Financial Service Providers Register website has additional information about 'what is a financial service'. For a full description see section 5 of the Financial Service Providers (Registration and Dispute Resolution) Act 2008.
Some exemptions apply. For example, lawyers, chartered accountants, tax agents and real estate agents who only provide financial services in the ordinary course of their business do not need to register. For a full list of exemptions see section 7 of the Act.
The requirement to register is generally directed at entities and individuals who have a place of business in New Zealand or who live in New Zealand. However other legislation may require overseas people to be registered on the Financial Service Providers Register (see for example the Financial Advisers Act).
Do I need to register as an individual if my employer is registered?
The Act requires the person or entity that carries on the business to be registered. Therefore if you are an employee of a financial services provider company you don't have to be registered unless you are offering certain financial adviser services as explained below.
If you provide financial adviser services the requirement to register will depend on the types of financial adviser services you provide. If it's only class services or services to wholesale clients and your employer is a registered financial service provider, then you do not have to register individually. If you are not a QFE adviser but are providing personalised financial adviser services to retail clients then you will need to be registered. You may also need to be authorised. See guidance question and answers.
Does my entity need to register if it is only servicing its outstanding loans?
The Act requires credit providers to be registered. Providing credit generally means providing a loan or having a debt due to you. The requirement covers credit provided under a credit contract, as set out in the Credit Contracts and Consumer Finance Act 2003 (with some additional exclusions set out in the Financial Service Providers Act). This covers lending to businesses as well as to retail customers.
Your entity provides credit (and needs to be registered) until the credit is completely repaid (or forgiven). Providing credit includes having a loan due to you that was originally made by another provider. For example, you will usually need to register if you have bought or been assigned a loan.
Credit providers providing credit to retail customers will also need to belong to a dispute resolution scheme (see below).
Who must be a member of a dispute resolution scheme?
Financial service providers who have retail clients must belong to either an approved dispute resolution scheme or the reserve scheme established by the government. If you are a financial adviser employee or agent (including a QFE adviser) and your employer or principal is a member of a scheme you will be covered by their membership for the services you provide on their behalf. The Ministry of Consumer Affairs administers the government's reserve scheme and has information on approved schemes.
Do I need to register if I am a one-off or occasional issuer?
Generally not. One-off or occasional instances of issuing by a business that otherwise is not a financial service provider would not normally be sufficient to constitute being in the business of providing a financial service. There are some exceptions to the general rule where the issuing of securities is closely tied to the core business of the issuer. See our information sheet for more details.
What are the regulation and registration requirements for marinas?
Marinas will not be regulated under the FMC Act and will no longer need to register on the Financial Service Providers Register. See our information sheet for more details.
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