On 12 June 2025, the Financial Markets Conduct Amendment Regulations 2025 (Amendment Regulations) will amend the Financial Markets Conduct Regulations 2014 (FMCR).

This Financial Markets article outlines the suite of amendments to be made to the FMCR by the Amendment Regulations, including some of the lower profile – but very helpful – technical changes designed to make life easier for managers of managed investment schemes.

Removal of PFI requirement for IPOS

The highest profile change to be made by the Amendment Regulations is the removal of the requirement for prospective financial information (PFI) for an initial public offering (IPO).

The Amendment Regulations amend Schedule 3 of the FMCR to remove the requirement to include PFI in an IPO product disclosure statement (PDS), and instead makes the inclusion of PFI optional.
In addition, the Amendment Regulations also remove the prescriptive requirements relating to the preparation and presentation of PFI. Now, where IPO issuers choose to include PFI, they will have a discretion as to how the PFI is prepared and presented in the PDS.

Incorporation of current class exemption notices

The Amendment Regulations incorporate into the body of the FMCR the policy of a number of current class exemption notices.

The exemption notices which now form a part of the FMCR are the following:

• Financial Markets Conduct (Restricted Schemes—Disclosure and Reporting) Exemption Notice 2022: This exempts defined benefit restricted schemes from annual fund update requirements, and all restricted schemes from certain quarterly reporting requirements.
• Financial Markets Conduct (Restricted Schemes—Custodian Assurance Engagement) Exemption Notice 2024: This exempts certain eligible restricted schemes from the requirement to obtain an assurance engagement.
• Financial Markets Conduct (Market Index) Exemption Notice 2024: This exempts managers from certain PDS and fund update requirements relating to ‘appropriate market indices’ where no appropriate index exists.
• Financial Markets Conduct (Wholesale Investor Exclusion—$750,000 Minimum Investment in Kauri Bonds) Exemption Notice 2021: This exempts offerors of Kauri bonds from warning and investor acknowledgement requirements for the $750,000 wholesale investor exemption.

The upshot of incorporating these class exemption notices into the FMCR is that these exemptions will no longer need to be renewed every five years.

Technical amendments to administrative requirements

A number of the amendments to be made by the Amendment Regulations will remove administrative issues faced by managers of managed investment schemes. These amendments relate broadly to administrative requirements on managers, including reporting and provision of information requirements.

In particular, the Amendment Regulations:

• Extend the deadline for fund managers to provide 6-monthly confirmation information to product holders from 10 working days to 20 working days. This change does not apply to managers of KiwiSaver schemes, superannuation schemes, or workplace savings schemes, which are subject to different member statement requirements.
• Extend the deadline for restricted schemes that are KiwiSaver, superannuation, or workplace savings schemes to provide annual confirmation information to members to align with the deadline for providing the annual report.
• Provide for a process under which the manager of a ‘closed-ended scheme’ (such as a property syndication) can waive annual meeting requirements if it is consistent with the scheme’s interests and the scheme’s supervisor consents.
• Remove the requirement to include a risk indicator calculated up to the latest quarter-end in a replacement managed fund PDS if the PDS is being lodged after a quarter (or reporting year) ending but before the deadline for making the fund update available for that period. This removes an issue that arose where a PDS needed to be lodged shortly after the end of a quarter but before the data required to calculate the risk indicator was available.
• Remove the corresponding requirement to update certain information on the fund’s online Disclose register entry in the same circumstances.

Although of more general application, the Amendment Regulations also remove the requirement for disclosure of names of counterparties to derivative relevant interest transactions for substantial product holders in listed issuers.

Takeaways from the Amendment Regulations

The removal of PFI requirements for IPOs are getting the most attention (and deservedly so). However, it’s important not to lose sight of the positive impact that some of the more technical amendments to be made by the Amendment Regulations will have on managers’ day-to-day lives. We appreciate that the Government has recognised issues in the FMCR that have been bugging providers for some time, and has moved to correct these issues.

Start a conversation

If you would like to discuss any aspect of the amendment regulations or any other financial services matter, please contact David Ireland on +64 4 498 0840, Catriona Grover on +64 4 498 0816 or Mark Schroder on +64 9 375 1120 or email the team at bankingandfinancialmarkets.nz@dentons.com