The Ministry of Business, Innovation and Employment (MBIE) is seeking comments on whether regulations need to be developed under new uninvited direct sales provisions in the Fair Trading Act 1986 (FTA) introduced by the Fair Trading Amendment Act 2013.
From 17 June 2014, the FTA will regulate uninvited direct sales (UDS) to consumers in place of the provisions in the Door to Door Sales Act 1967.
Similar UDS provisions are also part of the Financial Markets Conduct Act 2013 (FMCA). These relate to offers of financial products to persons who are not acting in trade in the course of unsolicited meetings.
In response to concerns raised by some stakeholders, MBIE is consulting on whether regulations are required to exempt from the UDS provisions in the FTA some (but not all) sales of financial products that are already exempt from the unsolicited meetings provisions of the FMCA. Of particular concern is whether exemptions should be granted from the UDS provisions in the FTA where:
- the offer is to “wholesale investors” who are experienced, closely connected to the issuer, or were considered in the FMCA context to not need protections from pressure selling, but only in relation to offers that do not require disclosure because of one of the specified exclusions in Schedule 1 of the FMCA;
- the financial product offer is made through an authorised financial adviser or “QFE adviser”;
- the offer is of financial products quoted on the NZX or another market and the offer is made through a person who is permitted under the Financial Advisers Act to give advice on that offer.
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