Draft regulations covering the implementation of Phase 2 of the Financial Markets Conduct Act 2013 (FMC Act) have been released by the Ministry of Business Innovation and Employment (MBIE) in time for everyone to read over the holiday period. Fortunately, MBIE have provided a longer than usual consultation period so there should still be time to follow these up in the New Year. Submissions close on 14 March 2014.

What's in this second exposure draft of the regulations?

The exposure draft of the regulations covers the regulations required for the governance of financial products (Part 4 of the FMC Act), dealing in financial products on licensed markets (Part 5 of the FMC Act), and the conduct obligations for discretionary investment management services (Part 6 of the FMC Act). A copy of the draft regulations is available here.

MBIE has also released a commentary to accompany the draft regulations which contains an outline of the regulations as well as notes on particular issues that MBIE are seeking feedback on.

The regulations implement Cabinet decisions on the FMC Regulations made in June 2013. For a copy of Bell Gully's detailed outline of Cabinet's key decisions, click here.

What's next?

MBIE are still analysing the submissions on the exposure draft of disclosure requirements released as part of the Phase 1 regulation consultation round. These will be the basis for the third exposure draft of the FMC regulations which are expected to be released in April-May 2014.

The full set of regulations (which will incorporate all three exposure drafts) will be made in mid-2014. These will replace the earlier Phase 1 regulations which will come into force on 1 April 2014.

Click here for further information and to access MBIE's online submission questionnaire for this exposure draft of the regulations.