The Securities Act (Charitable and Religious Purposes) Exemption Notice 2003 expired at the end of November 2013 and was replaced by the Securities Act (Charity Debt Securities) Exemption Notice 2013 and the Securities Act (Commodity and Recreational Purposes) Exemption Notice 2013.

Both of the notices came into force on 1 December 2013, although charities will have until 1 February 2014 (during which time they will be able to continue to rely on the exemptions in the 2003 notice) to transition to the new requirements under the Securities Act (Charity Debt Securities) Exemption Notice 2013.

Key changes to the Securities Act (Charity Debt Securities) Exemption Notice (which exempts registered charities from the trustee, registered prospectus, investment statement, and advertising certificate requirements in respect of offers of debt securities) include the following:

  • the exemptions are only available to registered charities;
  • a new information document and warning statement must be provided to investors, ensuring they understand there is no independent supervision, the implications of this, and recommending investors seek financial advice;
  • the introduction of a financial limit of NZ$15 million total debt securities outstanding at any one time and applying to all organisations; and
  • the introduction of a notification and reporting requirement to FMA.

The Securities Act (Community and Recreational Purposes) Exemption Notice 2013 grants exemptions that are substantially the same as those contained in the 2003 notice to non-profit organisations such as community-based recreational clubs from the statutory supervisor, registered prospectus, investment statement, and advertising certificate requirements in respect of offers of participatory securities.

Further information on FMA's decisions relating to these notices is available here.