Under the Financial Advisers (Australian Licensees) Exemption Notice 2011, Australian-regulated financial services firms (Australian Licensees) can apply to the Financial Markets Authority to be temporarily exempt from key provisions of the New Zealand financial services regulatory regime.

The exemption will apply in respect of services provided from Australia to the Australian Licensee’s New Zealand clients if the relevant firm is licensed by the Australian Securities and Investments Commission to provide financial product advice to retail clients, and has no place of business here.

Relief is given in respect of the following requirements under the Financial Advisers Act 2008 (FAA) and the Financial Service Providers (Registration and Dispute Resolution) Act 2008 (FSPA):

  • The requirement under the FAA to act only through registered or authorised individual advisers (in the case of Australian Licensees), or to be registered or authorised (in the case of specified representatives of an Australian Licensee)
  • The restriction under the FAA on a person holding themselves out as a financial planner or investment planner
  • The requirement under the FAA to make disclosure before providing personalised service to retail clients
  • The obligation for specified representatives acting on behalf of an Australian Licensee to be registered under the FSPA before providing financial services, or holding themselves out as being in the business of providing financial services (the Australian Licensee itself must be registered as a financial service provider).

The exemption is subject to various conditions, in particular, that no relevant New Zealand retail client is solicited in New Zealand (firms wishing to actively build their New Zealand client base will need to comply fully with the FAA and FSPA).  Written disclosure must be made to New Zealand retail clients, notifying them of the exemption and setting out the matters required to be disclosed by the relevant Australian regulations.

The Financial Markets Authority has noted that it considers the exemption a temporary measure to assist Australian-regulated firms to service their clients on an offshore basis while long-term mutual arrangements for trans-Tasman recognition are considered.  The exemption notice expires on 30 June 2013.

For more information on the exemption notice visit the FMA's website here.