Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698838887270.pdf (New Zealand)
Reprint as at 7 July 2010 Financial Advisers Act 2008 Public Act Date of assent Commencement 2008 No 91 27 September 2008 see section 2 Contents Title Commencement Part 1 Preliminary provisions Purpose of Act Overview of Act Interpretation Who are clients Who are retail clients Who are wholesale clients Who are eligible investors Acceptance of certification Revocation of certification How to opt out of being wholesale client Giving revocation of certification or notification of opt out Meaning of acting on behalf of B’s business and acting through A Page 13 13 13 15 15 28 28 29 30 31 31 31 32 32 5A 5B 5C 5D 5E 5F 5G 5H 5I Note Changes authorised by section 17C of the Acts and Regulations Publication Act 1989 have been made in this reprint.
A general outline of these changes is set out in the notes at the end of this reprint, together with other explanatory material about this reprint.

This Act is administered by the Ministry of Economic Development.
1 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Act binds the Crown Part 2 Financial advisers and their disclosure and conduct obligations Outline Subpart 1—Key definitions for financial adviser services What are financial adviser services Who is financial adviser What is financial adviser service When person gives financial advice When person provides investment planning service When person provides discretionary investment management service Exemption for incidental service Other exemptions When financial adviser service is personalised service or class service When financial adviser service is personalised service or class service Subpart 1A—Restrictions on providing financial adviser services Types of financial adviser Restrictions on providing financial adviser services Who may provide financial adviser service Who is permitted to provide personalised service to retail clients Who is permitted to provide class service to retail clients Who is permitted to provide financial adviser service to wholesale clients 20A Who may hold themselves out as authorised financial Restrictions on holding out adviser 20B Who may hold themselves out as financial planner or investment planner 20C Who may hold themselves out as QFE or having QFE status 33 33 34 34 34 35 36 36 37 39 40 41 41 42 42 43 43 43 2 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Persons acting in course of business of employers and principals 20D Application of FSP Act to employees, etc 20E
 Who must be member of dispute resolution scheme 20F Who is responsible for financial adviser obligations Subpart 2—Financial advisers’ disclosure and conduct obligations Disclosure obligations for personalised services for retail clients What is disclosure obligation and when does it apply Financial adviser must make disclosure before providing personalised service to retail client What financial adviser must disclose Disclosure statement QFE must make disclosure before personalised service provided to retail
 client Disclosure by qualifying financial entity Disclosure must not be misleading, deceptive, or confusing Disclosure of additional information No compliance with disclosure obligations if disclosure out of date Advertisement advertising financial adviser services by authorised financial adviser must refer to disclosure statement Disclosure by 2 or more financial advisers in joint disclosure statement 26 27 28 29 30 31 32 What is conduct obligation and when does it apply Conduct obligations Conduct obligations that apply to all financial advisers [Repealed] Financial adviser must exercise care, diligence, and skill Financial adviser must not engage in misleading or deceptive conduct Advertisement by financial adviser must not be misleading, deceptive, or confusing Regulations may impose specific conduct obligations for class services to retail clients 33 34 35 36 44 44 44 45 45 46 46 47 47 48 49 49 50 50 50 51 51 52 52 3 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Conduct obligations that apply to authorised financial advisers only Authorised financial adviser must comply with code Authorised financial adviser must not recommend acquisition of securities if offer for subscription illegal Authorised financial adviser must pay client’s money into separate trust account [Repealed] Authorised financial adviser must account for client’s money or property [Repealed] Authorised financial adviser must keep records of client’s money and other
 property [Repealed] Restrictions on use of client’s money or property [Repealed] Protection of client’s money or property held on trust [Repealed] Meaning of received or held [Repealed] Authorised financial adviser must comply with terms and conditions of his or her authorisation Authorised financial adviser may report breach of Act to Commission Conduct obligations related to QFEs QFE must comply with terms and conditions of grant of QFE status QFE or member of QFE group must not engage in misleading or
 deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative Advertisement by QFE or member of QFE group in relation to financial adviser service must not be misleading, deceptive, or confusing Commission’s direction in respect of breach of disclosure or conduct obligation Commission may give financial adviser direction in respect of breach of disclosure or conduct obligation Part 3 Authorised financial advisers and qualifying financial entities Outline of this Part Subpart 1—Authorised financial advisers Who is authorised financial adviser 52 52 53 53 53 53 53 54 54 54 55 55 56 56 57 57 37 38 39 40 41 42 43 44 45 45A 46 47 48 49 50 51 4 Reprinted as at 7 July 2010 Financial Advisers Act 2008 52 53 54 55 55A 56 57 58 59 60 61 62 63 64 65 66 67 67A 68 69 70 71 72 73 74 Who may apply to be authorised Application to be authorised Eligibility to be authorised Commission must approve or decline application for authorisation Variation of terms and conditions and period of authorisation Commission must notify Registrar of authorisation Termination of authorisation Renewal of authorisation Commission’s powers in relation to default by authorised financial adviser Commission’s powers in relation to default by authorised financial adviser Reasonable opportunity to be heard Commission may give authorised financial adviser direction Other provisions concerning Commission’s powers in relation to default by authorised financial
 adviser Subpart 2—Qualifying financial entities What is qualifying financial entity (QFE) Who may apply for QFE status Application for QFE status Eligibility for QFE status Commission must approve or decline application for QFE status Associated entities may be subject to special terms and conditions in certain cases Determination of application Name of QFE group Commission must notify Registrar of grant of QFE status Commission’s powers in relation to default by QFE [Repealed] Addition of associated entities
 Termination of status of associated entity Certification of QFE group Nominated representatives of QFEs or partner entities 57 57 57 58 59 60 60 61 62 62 63 64 64 64 64 65 66 67 67 68 68 69 69 70 70 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Liability of employee or agent [Repealed] Variation of terms and conditions and period of grant of QFE status Termination of QFE status Commission may designate certain QFE products as beyond scope of QFE advisers Renewal of QFE status Commission’s powers in relation to default by QFE or by members of QFE group Commission’s powers in relation to QFE default Reasonable opportunity to be heard Commission may give QFE direction Other provisions concerning Commission’s powers in relation to QFE default 75 75A 75B 75C 75D 75E 75F 75G QFE’s obligations 76 77 Ongoing obligations of QFEs and of partner entities QFE must provide annual report to Commission Part 3A Brokers’ disclosure and conduct obligations Who is broker and what is broking service 77A Who is broker 77B What is broking service Other exemptions 77C Disclosure obligations for services for retail clients 77D What is disclosure obligation and when does it apply Broker must make disclosure before receiving client 77E money or client property from retail client 77F What broker must disclose and form of disclosure Disclosure must not be misleading, deceptive, or 77G confusing Disclosure of additional information No compliance with disclosure obligation if
 disclosure out of date 77H 77I Brokers’ conduct obligations 77J What is conduct obligation and when does it apply 77K 77L Broker must exercise care, diligence, and skill Broker must not engage in misleading or deceptive conduct 6 71 72 72 73 73 75 75 76 76 77 78 79 79 80 81 81 81 82 82 82 83 83 Reprinted as at 7 July 2010 Financial Advisers Act 2008 77M Advertisement of broking services must not be misleading, 77N 77O 77P 77Q 77R 77S 77T deceptive, or confusing Restriction on use of term sharebroker Broker
 must not receive client money if offer for subscription illegal Trust accounting obligations for services for retail clients Broker must pay client money into separate trust account Broker must account for client money and client property Broker must keep records of client money and client property Restrictions on use of client money and client property Protection of client money and client property held on trust Persons acting in course of business of employers or principals 77U Who is responsible for broker obligations Commission’s direction in respect of breach of disclosure or conduct obligation 77V Commission may give broker direction in respect of breach of disclosure or conduct obligation Part 4 How financial advisers and brokers are regulated 78 Outline of this Part Subpart 1—Commissioner for Financial Advisers, code of professional conduct, and code committee Commissioner for Financial Advisers 79 80 81 82 83 84 85 Commissioner for Financial Advisers Functions of Commissioner Code committee Commissioner must establish code committee Functions of code committee Membership of code committee Proceedings of code committee Certain provisions of Crown Entities Act 2004 apply to members of code committee Code of professional conduct for authorised financial advisers 86 Content of code 83 84 84 84 85 85 86 86 86 87 88 88 89 89 89 90 90 91 91 7 Financial Advisers Act 2008 Reprinted as at 7 July 2010 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 Code committee
 must prepare code Commissioner’s approval of draft code Commissioner may require revision or consultation Commissioner’s approval of revised draft code Deadline for Commissioner’s approval of draft code Minister’s approval required Deadline for Minister’s approval of draft code Code comes into force by Gazette notice Changes to code Changes to code Subpart 2—Complaints and disciplinary proceedings Who deals with complaints Complaint about financial adviser Investigation by Commission Complaint about
 authorised financial adviser Reference of complaint to disciplinary committee Disciplinary committee must give notice of complaint to financial adviser concerned Content of disciplinary committee’s notice of complaint Disciplinary committee may discipline authorised financial adviser for breach of code Reasonable opportunity to be heard Disciplinary committee 108 Functions of disciplinary committee 103 Minister must establish disciplinary committee 104 105 Membership of disciplinary committee Proceedings of disciplinary committee 106 Disciplinary committee may hear evidence in disciplinary 107 proceeding District Court may authorise disciplinary committee to summon witnesses on disciplinary matters Issuing of summons by disciplinary committee Serving of summons 109 110 111 Witnesses’ fees, allowances, and expenses 112 Protection for witnesses and counsel in disciplinary proceeding Certain provisions of Crown Entities Act 2004 apply to members of disciplinary committee 113 8 92 92 92 93 93 93 94 94 94 95 95 95 96 96 96 97 97 98 98 98 99 99 100 100 101 101 101 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Subpart 3—Offences Offences: Restrictions on providing services and holding out Offence of providing financial adviser service without being permitted to do so Offence of holding out as authorised financial adviser, financial planner, investment planner, or QFE Offences in relation to employer or principal failing to maintain registration Disclosure offences:
 Financial advisers, QFEs, and brokers Failure to make disclosure under or in accordance with disclosure obligation Conduct offences: Financial advisers and brokers Offence of misleading or deceptive conduct by financial adviser or broker Offence of misleading, deceptive, or confusing advertisement by financial adviser or broker Offence of contravening restrictions on use of term sharebroker Offences: Authorised financial advisers only Offence of recommending offer of securities when subscription illegal
 Offence of contravening requirement that authorised financial adviser pay client’s money into separate trust account [Repealed] Offence of failing to account for client’s money or other property [Repealed] Offence in relation to records of client’s money or property [Repealed] Offence of breaching restrictions on use of client’s money or property [Repealed] Offence of failing to comply with terms and conditions of authorisation Offence of failing to comply with Commission’s direction Offence of contravening condition of disciplinary committee’s order Offences: QFEs and QFE groups only Offence of failing to comply with terms and conditions of QFE status Financial Advisers Act 2008 Reprinted as at 7 July 2010 130 131 132 133 Offence of misleading or deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative Offence of misleading, etc, advertisement of financial adviser service by employee, agent, or nominated representative Offence of failing to comply with Commission’s direction Offence of failing to comply with obligations in relation to authorised financial advisers Offence of failing to provide annual report 134 134A Defence to offences relating to entities in QFE groups 106 106 107 107 107 108 134B Offence of receiving client money if offer for subscription 108 Offences: Broking services
 only illegal 134C Offence of contravening requirement to pay client money 108 into separate trust account 134D Offence of failing to account for client money and client property 134E Offence in relation to records of client money and client property 134F Offence of breaching restrictions on use of client money and client property 134G Offence of failing to comply with Commission’s direction Offence of failing to comply with Commission’s direction 135 in respect of breach of disclosure or conduct obligation
 Miscellaneous offences [Repealed] Offence of false declaration, etc, in support of application for authorisation or grant of QFE status Failure to comply with summons by Commissioner to attend disciplinary committee hearing 136 137 Subpart 4—Injunctions, banning orders, and other remedies Injunctions 137A Injunctions against contraventions 137B Undertaking as to damages not required by Commission 137C When court may make banning order 137D Terms of banning orders 137E Offence of contravening banning order 108 109 109 109 110 110 110 111 112 112 113 113 10 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Orders to preserve assets to satisfy claims 137F When High Court may prohibit payment or transfer of money, securities, or other property 137G What orders may be made 137H Interim orders 137I Relationship with other law 137J Offence of breaching orders 114 114 116 117 117 Pecuniary and compensatory orders for contravening wholesale certification requirement 137K Pecuniary order for contravening wholesale certification 117 requirement 137L Compensation for contravention of wholesale certification 118 requirement Temporary banning orders against financial adviser and broker 137M When Commission may make temporary banning orders for financial adviser services or broking services 137N Terms of temporary banning order Process for Commission’s orders 137O Commission must follow steps before making orders 137P Commission may shorten steps for specified orders 137Q
 Commission must give notice after making orders 137R General provisions on temporary banning orders 137S Offence of failing to comply with Commission’s orders Part 5 General provisions Appeal of decisions 138 139 140 141 142 143 144 145 146 147 Right of appeal Notice of right of appeal Decision to have effect pending determination of appeal Procedure on appeal Court’s decision final Court may refer matter back for reconsideration Orders as to costs Orders as to publication of names Appeal on question of law
 Securities Commission: General powers Commission may exercise powers under Securities Act 1978 119 119 120 120 121 121 122 122 123 123 123 124 124 124 124 125 125 11 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Standard conditions for incorporation in authorisation and grants 147A Approval of standard conditions for incorporation in authorisations and grants of QFE status 147B Requirement to consult on proposal to incorporate material by reference 147C Variation or revocation of standard conditions 147D When standard conditions come into force 147E Incorporation of changed standard conditions into existing authorisations or grants Exemptions Commission may grant exemptions 148 148A Commission may vary or revoke exemption 148B Status of exemptions, variations, or revocations 149 Commission must notify reasons for exemption other than class exemption Commission may vary or revoke exemption [Repealed] 151 Information sharing Information sharing Fees and levies Commission’s fees, charges, and costs Levy Regulations General regulations Regulations relating to fees, charges, and costs Other matters No contracting out Territorial scope Breach of exemption conditions Exemption or regulation in respect of specified overseas jurisdictions [Repealed] Time for laying information for summary offences 160 161 Ministry must review and report on operation of Act 161A Financial Service Providers (Registration and Dispute Other legislation affected Resolution) Act 2008
 amended KiwiSaver Act 2006 amended Securities Act 1978 amended Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 3 164 165 166 167 168 1 2 (1) Securities Markets Act 1988 amended Sharebrokers Act 1908 repealed Securities Markets (Investment Advisers and Brokers) Regulations 2007 revoked Transitional provisions Transitional provisions for existing
 offences and contravention under Securities Markets Act 1988 Grant of authorisations in transitional period without prior inquiry into convictions 139 139 140 140 140 Title This Act is the Financial Advisers Act 2008.
Commencement This Act comes into force on a date to be appointed by the Governor-General by Order in Council.

(2) One or more Orders in Council may be made appointing dif- ferent dates for the commencement of different provisions.

(3) Despite subsection (1), sections 8 to 15 (as enacted by the Fi- nancial Advisers Amendment Act 2010) come into force on the day after the date on which the Financial Advisers Amend- ment Act 2010 receives the Royal assent.
Section 2: Part 1 and sections 7–13, 78–95, 152–155, and 163(1)–(6) brought into force, on 5 December 2008, by the Financial Advisers Act Commencement Order 2008 (SR 2008/412).

Section 2(3): added, on 1 July 2010, by section 5 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Part 1 Preliminary provisions 3 (1) Purpose of Act The purpose of this Act is to promote the sound and efficient delivery of financial adviser and broking services, and to en- courage public confidence in the professionalism and integrity of financial advisers and brokers.
13 Part 1 s 3 Financial Advisers Act 2008 Reprinted as at 7 July 2010 [Repealed] (a) [Repealed] (b) (c) [Repealed] To this end, the Act— (a) (b) requires financial advisers and brokers to take an appro- priate degree of care in providing services to investors and consumers and prohibits certain conduct by finan- cial advisers and brokers; and in addition,— (i) requires disclosure by financial advisers and bro- kers to retail clients, so ensuring that clients can make informed decisions about whether to use the financial adviser or broker and, in the case of an adviser, whether to follow a financial ad- viser’s advice; and imposes competency requirements on certain fi- nancial advisers who deal with retail clients, so ensuring that there are available to retail clients financial advisers who have the experience, ex- pertise, and integrity to match effectively a per- son to a financial product that best meets that per- son’s need and risk profile; and ensures that financial advisers are held account- able for the services that they give to retail clients and that there are incentives for financial advis- ers to manage conflicts of interest appropriately.
Section 3(1): amended, on 1 July 2010, by section 6(1)(a) of the Financial Ad- visers Amendment Act 2010 (2010 No 40).

(iii) (ii) Section 3(1): amended, on 1 July 2010, by section 6(1)(b) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 3(1)(a): repealed, on 1 July 2010, by section 6(1)(c) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 3(1)(b): repealed, on 1 July 2010, by section 6(1)(c) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 3(1)(c): repealed, on 1 July 2010, by section 6(1)(c) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 3(2): added, on 1 July 2010, by section 6(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 14 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 4 5 Overview of Act This Act is divided into 6 Parts, which are— Part 1 (Preliminary provisions): (a) Part 2 (Financial advisers and their disclosure and con- (b) duct obligations): Part 3 (Authorised financial advisers and qualifying fi- nancial entities): (c) (ca) Part 3A (Brokers’ disclosure and conduct obligations): (d) (e) Section 4: amended, on 1 July 2010, by section 7(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Part 4 (How financial advisers are regulated): Part 5 (General provisions).

Section 4(ca): inserted, on 1 July 2010, by section 7(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Interpretation In this Act, unless the context otherwise requires,— acting through has the meaning set out in section 5I(2) advertisement means a form of communication that is to be, or has been, distributed to a person and— (a) in relation to a financial adviser service,— (i) refers to a financial adviser or financial adviser service or is reasonably likely to induce persons to seek a financial adviser service; and is authorised or instigated by, or on behalf of, a financial adviser, a QFE, or a member of a QFE group, or prepared with the co-operation of, or by arrangement with, a financial adviser, a QFE, or a member of a QFE group; and (b) in relation to a broker service,— (i) refers to a broker or broking service or is reason- ably likely to induce persons to seek a broking service; and is authorised or instigated by, or on behalf of, a broker or prepared with the co-operation of, or by arrangement with, a broker (ii) (ii) approved dispute resolution scheme has the same meaning as in section 4 of the FSP Act, but also includes the reserve scheme within the meaning of section 71 of the FSP Act 15 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 approved rating agency means a rating agency nominated or approved under the Reserve Bank of New Zealand Act 1989 or section 17 of the Insurance Companies (Ratings and Inspec- tions) Act 1994 associated entity, in relation to a QFE, means an entity that, under an approval given under section 67(4) or 71, is an asso- ciated entity of that QFE
 authorised means authorised by the Commission under sec- tion 55 authorised financial adviser means a person described in sec- tion 51 bank in New Zealand means a registered bank that carries on in New Zealand the business of banking bank term deposit means a fixed term deposit product offered by a registered bank in New Zealand bonus bond means a unit in an approved unit trust within the meaning of section 3(1) of the Finance Act (No 2) 1990 broker has the meaning set out in section 77A broker obligation means an
 obligation of a broker under this Act or the regulations broking service has the meaning set out in section 77B building society has the same meaning as in section 2(1) of the Building Societies Act 1965 business includes any profession, trade, or undertaking, whether or not carried on with the intention of making a profit call building society share or call credit union share means a share issued by a building society or credit union under which— (a) the shareholder, in the case of a building society, or member, in the case of a credit union, has a right to demand repayment of the value of the share in full at any time; and the building society or credit union has an obligation to repay the value of the share in full not later than 1 working day after the demand is made; and the rate of dividend or interest payable or any other benefit provided does not alter as a result of the demand being made; and (b) (c) 16 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 (d) no fee or other amount is payable as a result of the prin- cipal sum not having been held by the building society or credit union for a particular period of time call debt security means a debt security under which— (a) the security holder has a right to demand repayment of the principal sum in full at any time; and the issuer has an obligation to repay the principal sum in full not later than 1 working day after the demand is made; and the rate of interest payable or any other benefit provided does not alter as a result of the demand being made; and no fee or other amount is payable as a result of the prin- cipal sum not having been held by the issuer for a par- ticular period of time (b) (c) (d) category 1 product means any of the following products (other than a product that is a category 2 product): (a) (b) a security; or a land investment product (as defined in the regula- tions); or a futures contract; or an investment-linked contract of insurance; or any other product specified
 by the regulations; or a renewal or variation of the terms or conditions of an existing category 1 product (c) (d) (e) (f) category 2 product means any of the following products: (a) (b) (c) (d) (e) (f) a bank term deposit; or a bonus bond; or a call building society share; or a call credit union share; or a call debt security; or a share in a co-operative company (as defined in section 2(1) of the Co-operative Companies Act 1996); or a unit in a cash or term portfolio investment entity (as defined in the regulations); or a consumer credit contract within the meaning of the Credit Contracts and Consumer Finance Act 2003; or a contract of insurance (other than an investment-linked contract of insurance); or (g) (h) (i) 17 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (j) (k) (l) a life insurance policy (within the meaning of section 2(1) of the Securities Act 1978) issued before 1 January 2009; or any other product specified by the regulations; or a renewal or variation of the terms or conditions of any existing category 2 product chartered accountant has the same meaning as in section 2 of the New Zealand Institute of Chartered Accountants Act 1996 class of financial products means a group of financial prod- ucts with similar characteristics class service has the meaning set out in section 15(3) client has the meaning set out in section 5A client money means money received from, or on account of, a client in relation to acquiring, holding, or
 disposing of a fi- nancial product client property means property received from, or on account of, a client in relation to acquiring, holding, or disposing of a financial product code means the code of professional conduct brought into force under section 94 college of education has the same meaning as in section 159 of the Education Act 1989 Commission means the Securities Commission established under the Securities Act 1978 Commissioner for Financial Advisers or Commissioner means the person appointed under
 section 79(3) conduct obligation means,— (a) in relation to a financial adviser, a QFE, or a member of a QFE group, an obligation described in section 32: in relation to a broker, an obligation described in section 77J (b) controlling owner has the meaning set out in section 4 of the FSP Act conveyancing practitioner has the same meaning as in sec- tion 6 of the Lawyers and Conveyancers Act 2006 credit union has the meaning set out in section 2 of the Friendly Societies and Credit Unions Act 1982 18 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 Crown organisation has the same meaning as in section 6 of the Lawyers and Conveyancers Act 2006 director means a director as defined in section 126 of the Com- panies Act 1993 disclosure obligation means,— (a) in relation to a financial adviser, a QFE, or a member of a QFE group, an obligation described in section 21: in relation to a broker, an obligation described in section 77D (b) discretionary investment management service has the meaning set out in section 12 dispose of includes— (a) dispose of by allotting, withdrawing from, or terminat- ing; and agree to dispose of (b) document means— (a) any material, whether or not it is signed or otherwise authenticated, that bears symbols (including words and figures), images, or sounds from which symbols, images, or sounds can be derived, and includes— (i) a label, marking, or other writing that identifies or describes a thing of which it forms part, or
 to which it is attached: a book, map, plan, graph, or drawing: a photograph, film, or negative; or (ii) (iii) information electronically recorded or stored, and infor- mation derived from that information (b) entity— (a) includes a body corporate and an unincorporated body (including partners in a partnership, members of a joint venture, or the trustees of a trust) and the sole trustee of a trust acting in his, her, or its capacity as trustee of that trust; but does not include an individual (b) exempt
 provider means— (a) a person to whom both of the following 2 subparagraphs apply (an overseas financial adviser): 19 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (i) (ii) the person is not ordinarily resident in New Zealand (within the meaning of section 4 of the Crimes Act 1961) and does not have a place of business in New Zealand; and no financial adviser services provided by the per- son are received by retail clients in New Zealand; and a person who is exempted under section 148 of this Act or the regulations from the obligation to register by virtue of providing financial adviser services; and a person who is excluded from the application of the FSP Act under section 7(2) and (3) of that Act or who is exempted, under the FSP Act, from the obligation to register (unless the exclusion or exemption is limited so that it does not apply in respect of financial adviser services) (b) (c) financial adviser has the meaning set out in section 8 financial adviser obligation means an obligation of a finan- cial adviser under this Act, the regulations, or the code financial adviser service has the meaning set out in section 9 financial product means a category 1 product or a category 2 product financial service means a financial service as defined in sec- tion 5 of the FSP Act (but excluding financial services pro- vided by a person to whom section 7(2) or (3) of that Act ap- plies) FSP Act means the Financial Service Providers (Registration and
 Dispute Resolution) Act 2008 futures contract has the same meaning as in section 37(1) of the Securities Markets Act 1988 general education system has the same meaning as in section 120 of the Education Act 1989 incorporated law firm has the meaning given by section 6 of the Lawyers and Conveyancers Act 2006 individual means a natural person investment-linked contract of insurance has the meaning set out in the regulations 20 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 investment planning
 service has the meaning set out in sec- tion 11 investment statement has the same meaning as in section 38C of the Securities Act 1978 issuer has the same meaning as in section 2(1) of the Securities Act 1978 lawyer has the same meaning as in section 6 of the Lawyers and Conveyancers Act 2006 lecturer means a person who is employed by a university, polytechnic, or college of education to teach or instruct stu- dents of the university, polytechnic, or college of education licensed service has the same meaning as in section 4 of the FSP Act local authority has the same meaning as in section 5(1) of the Local Government Act 2002 member of a QFE group means a partner entity or an asso- ciated entity Minister means the Minister of the Crown who, under the au- thority of any warrant or with the authority of the Prime Min- ister, is for the time being responsible for the administration of this Act Ministry means the department of State that, with the author- ity of the Prime Minister, is for the time being responsible for the administration of this Act nominated representative means an individual who has been nominated by a QFE or by a partner entity in accordance with section 74 and whose nomination has not been terminated under that section non-profit organisation means any organisation, whether in- corporated or not, that is carried on other than for the purposes of profit or gain to an owner, member, or shareholder on behalf of the business of another person or on behalf of another person’s business has the meaning set out in section 5I(1) overseas regulator means a body in another country with functions corresponding to those of the Commission under this Act 21 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (c) partner entity, in relation to a QFE, means an entity that is part of the QFE personalised service has the meaning set out in section 15 polytechnic has the same meaning as in section 159(1) of the Education Act 1989 prescribed means
 prescribed by regulations made under this Act principal officer means a director or a person who occupies a position equivalent to that of a director (such as a trustee or partner) product provider means— (a) (b) the issuer, in the case of a security: the creditor, in the case of a consumer credit contract (within the meaning of the Credit Contracts and Con- sumer Finance Act 2003): the insurer, in the case of a contract of insurance (other than an investment-linked contract of insurance): the person specified by regulations, in any other case (d) promoter has the same meaning as in section 2(1) of the Se- curities Act 1978 prospectus has the same meaning as in section 2(1) of the Securities Act 1978 QFE or qualifying financial entity means an entity described in section 63(1)(a) or a number of partner entities described in section 63(1)(b) QFE adviser means an individual who is not an authorised financial adviser and who is— (a) an employee of a QFE or any member of a QFE group; or a nominated representative of a QFE or a partner entity (b) QFE group means a group of entities that consists of— (a) the partner entities that are part of a QFE and the asso- ciated entities of that QFE, if any; or in the case of a QFE that does not come within para- graph (a), that QFE and its associated entities (b) real estate agent means a person who is a licensee under the Real Estate Agents Act 2008 22 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 record
 includes— (a) any file, register, ledger, book of account, or passbook, and any reproduction or copy of them or any entry in any of them; and any apparatus or equipment in or on which information is recorded, stored, or embodied in any form so as to be capable of being retrieved, reproduced, or processed by any means; and any material by means of which information is supplied to, or derived from, any such apparatus or equipment (b) (c) register means the register of financial service providers main- tained
 under the FSP Act registered means registered under the FSP Act in respect of a financial adviser service, and registration has a corresponding meaning registered bank has the same meaning as in section 2(1) of the Reserve Bank of New Zealand Act 1989 registered exchange has the same meaning as in section 2(1) of the Securities Markets Act 1988 registered legal executive means a person who is a member of the New Zealand Institute of Legal Executives Incorporated and holds a current annual registration certificate issued by that body registered valuer has the same meaning as in section 2 of the Valuers Act 1948 Registrar means the Registrar of Financial Service Providers regulations means regulations made under this Act related body corporate has the meaning set out in section 5B(2) of the Securities Markets Act 1988 relevant service has the meaning set out in section 14(3) retail client has the meaning set out in section 5B security— (a) means— (i) any interest in, or right to participate in, any cap- ital, assets, earnings, royalties, or other property of any person: any interest in, or right to be paid, money that is, or is to be, deposited with, lent to, or otherwise (ii) 23 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 owing by any person (whether or not the interest or right is secured by a charge over any property); but (b) does not include— (i) a security exempted from Part 2 of the Securities Act 1978 under any of paragraphs (b) to (h) of
 section 5(1) of that Act; or an investment-linked contract of insurance; or a life insurance policy (within the meaning of section 2(1) of the Securities Act 1978) issued before 1 January 2009 (ii) (iii) standard conditions means standard terms and conditions for the time being approved by the Commission under section 147A or 147C and in force under section 147D State services has the meaning given to it in section 2 of the State Sector Act 1988 State services employee means an employee or chief execu-
 tive in any part of the State services, whether paid by salary, wages, or otherwise statutory officer means a person— (a) holding or performing the duties of an office established by an enactment; or performing duties expressly conferred on that person by virtue of his or her office by an enactment; or holding office as the chief executive of a Crown organ- isation (b) (c) Takeovers Code means the takeovers code in force under the Takeovers Act 1993 tax agent has the same meaning as in section 3(1) of the Tax Administration Act 1994 teacher means a person in a teaching position in the general education system teaching position has the same meaning as in section 120 of the Education Act 1989 trust account records— (a) means records relating to a trust account; and (b) includes any information that relates to a trust account and that is recorded or stored by means of any tape 24 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 recorder, computer, or other device, and any material subsequently derived from information so recorded or stored trustee corporation means Public Trust, the Māori Trustee, or any corporation authorised by an Act to administer the estates of deceased persons and other trust estates (and any wholly owned subsidiary of that corporation that is guaranteed by the corporation) university has the same meaning as in section 159 of the Edu- cation Act 1989 wholesale client has the meaning set out in section 5C.
Section 5 acting through: inserted, on 1 July 2010, by section 8(1) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).

Section 5 advertisement: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 approved dispute resolution scheme: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 approved rating agency: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 associated entity: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 authorised advertisement: repealed, on 1 July 2010, by section 8(3) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 bonus bond: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 broker: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 broker obligation: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 broking service: Financial Advisers Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 8(1) of the Section 5 building society: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 call building society share or call credit union share: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 call debt security: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 category 1 product: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 category 2 product: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

25 Part 1 s 5 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Section 5 chartered accountant: amended, on 7 July 2010, by section 10 of the New Zealand Institute of Chartered Accountants Amendment Act 2010 (2010 No 74).
Section 5 class of financial products: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 class service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 client: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 client money: inserted, on 1 July 2010, by section 8(1) of the Finan- cial Advisers Amendment Act 2010 (2010 No 40).

Section 5 client property: inserted, on 1 July 2010, by section 8(1) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).

Section 5 conduct obligation: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 controlling owner: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 conveyancing practitioner: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 credit union: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 disclosure obligation: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 discretionary investment management service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 entity: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 exempt provider: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 financial adviser service: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 financial planning service: repealed, on 1 July 2010, by section 8(3) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 financial service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 incorporated law firm: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 investment-linked contract of insurance: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 investment planning service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 investment transaction: repealed, on 1 July 2010, by section 8(3) of the Financial Advisers Amendment Act 2010 (2010 No 40).

26 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5 Section 5 life insurance policy: repealed, on 1 July 2010, by section 8(3) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 local authority: inserted, on 1 July 2010, by section 8(1) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).

Section 5 member of a QFE group: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 nominated representative: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 non-profit organisation: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 on behalf of the business of another person or on behalf of another person’s business: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 partner entity: inserted, on 1 July 2010, by section 8(1) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).
Section 5 personalised service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 product provider: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 promoter: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 QFE or qualifying financial entity: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 QFE adviser: inserted, on 1 July 2010, by section 8(1) of the Finan- cial Advisers Amendment Act 2010 (2010 No 40).

Section 5 QFE group: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 registered: substituted, on 1 July 2010, by section 8(2) of the Finan- cial Advisers Amendment Act 2010 (2010 No 40).

Section 5 registered legal executive: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 related body corporate: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 related company: repealed, on 1 July 2010, by section 8(3) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 relevant service: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 retail client: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 security: substituted, on 1 July 2010, by section 8(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 5 standard conditions: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 statutory officer: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

27 Part 1 s 5A Financial Advisers Act 2008 Reprinted as at 7 July 2010 Section 5 trust account: repealed, on 1 July 2010, by section 8(3) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).
Section 5 trustee corporation: inserted, on 1 July 2010, by section 8(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 5 wholesale client: added, on 1 July 2010, by section 8(1) of the Fi- nancial Advisers Amendment Act 2010 (2010 No 40).
5A Who are clients (1) For the purposes of this Act, a client— (a) means a person who receives a service (whether or not (b) (c) on payment of a charge); and in relation to a broking service, means the person on whose behalf the financial product is acquired or dis- posed of or the client money or client property is held (but excludes the product provider); but does not include a person who receives any service from another person if the service is both provided and re- ceived in the course of, and for the purposes of,— (i) (ii) (iii) the same business; or the businesses of related bodies corporate; or the businesses of members of a QFE group.
Example If a company employee (A) gives financial advice to the board of directors on investments to be made by the com- pany, the directors are not clients of A.

However, if A, in the course of business, gives that same financial advice to another employee (B) in relation to B’s own investments, B would be a client of A for the purposes of this Act.
(2) Subsection (1) applies whether the person providing or receiv- ing the service is the person carrying on the business, a con- trolling owner, a director, an agent, or any other person.

Section 5A: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).

5B Who are retail clients A retail client is a client of a financial adviser or broker who is not a wholesale client.
Section 5B: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).
28 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5C 5C Who are wholesale clients (1) The following clients of a financial adviser or broker are wholesale clients in respect of a financial adviser service or a broking service (unless the person has opted out from being a wholesale client under section 5G): (a) (b) (c) (d) (e) (f) (g) any other financial adviser or broker who receives the service in the course of business as a financial adviser or broker: a person who is in the business of providing any other financial service and receives the financial adviser ser- vice or broking service in the course of that business: a person whose principal business is the investment of money or who, in the course of and for the purposes of the person’s business, habitually invests money: an entity to which at least 1 of the following applied at the end of each of the last 2 completed accounting periods: (i) at the balance date, the net assets of the entity exceeded $1 million: the turnover of the entity for the accounting period exceeded $1 million: (ii) a related body corporate of an entity to which paragraph (d) applies: a local authority, a Crown entity, a State enterprise, the Reserve Bank of New Zealand, and the National Provident Fund (and a company appointed under clause 3(1)(b) of Schedule 4 of the National Provident Fund Restructuring Act 1990): a person who falls within 1 or more of the categories listed in section 3(2), 5(2CB), or 5(2CBA) of the Secur- ities Act 1978 if the service relates to securities that may be offered to that person, or that have been subscribed for by that person, in a private offer of securities: an eligible investor under section 5D.
(2) (h) If subsection (1) applies to a person (A), it applies equally to any controlling owner, director, employee, agent, or other person acting in the course of, and for the purposes of, A’s business to the same extent as it applies to A.
29 Part 1 s 5D Financial Advisers Act 2008 Reprinted as at 7 July 2010 (3) In this section, a private offer of securities means an offer of securities that— (a) does not constitute an offer of securities to the public under section 3 of the Securities Act 1978; or is exempt from Part 2 (other than sections 38B and 58) of that Act under section 5(2CB) or 5(2CBA) of that Act.

(b) Section 5C: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).
5D Who are eligible investors (1) A client is an eligible investor if— (a) the client certifies in writing that— (i) (ii) the client has sufficient knowledge, skills, or ex- perience in financial matters to assess the value and risks of financial products and the merits of the service or services to be provided; and the client understands the consequences of certi- fying himself, herself, or itself to be an eligible investor (including that the competency stand- ards and requirements of the code will not be ap- plicable (if relevant) and that the financial adviser or broker may not be a member of an approved dispute resolution scheme); and (b) (c) the client states the reasons for this certification; and a financial adviser, a QFE, or a broker signs a written acceptance of the certification in accordance with sec- tion 5E.
(2) A certification may be specific to a particular service or class of services or may be general (but is effective only in relation to services provided after all of the requirements of subsection (1)(a) to (c) are met).

(3) A certification relating only to a discretionary investment man- agement service or a broking service (or both) does not need to certify as to the matters referred to in subsection (1)(a)(i).
Section 5D: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).
30 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 1 s 5G 5E Acceptance of certification (1) A financial adviser, a QFE, or a broker must not accept a cer- tification unless he, she, or it, having considered the client’s reasons for the certification,— (a) is satisfied that the client has been sufficiently advised of the consequences of the certification; and has no reason to believe that the certification is incorrect or that further information or investigation is required as to whether or not the certification is correct.
(b) (2) The person who accepts the certification of a client may be the financial adviser or broker for the client (but does not need to be).

(3) A financial adviser (other than an authorised financial adviser or QFE) or broker who accepts a certification without having complied with subsection (1) contravenes a wholesale certifi- cation requirement.

Contravention of this section may give rise to a pecuniary penalty order or compensatory order (see sections 137K and 137L).
Section 5E: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(4) Revocation of certification 5F (1) A client who is an eligible investor may revoke a certification, in relation to a financial adviser or broker to whom the certifi- cation has been given, by giving the financial adviser or broker a signed notification to that effect.

(2) A revocation is effective only in relation to services provided after it is given.
Section 5F: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).

5G How to opt out of being wholesale client (1) A person may opt out of being a wholesale client, in relation to a financial adviser or broker, by giving the financial adviser or broker a signed notification to that effect.
(2) A notification may be specific to a particular service, or class of services, or may be general for all services provided by the financial adviser or broker to whom it is given.

31 Part 1 s 5H Financial Advisers Act 2008 Reprinted as at 7 July 2010 (3) A person may vary or revoke a notification in the same way as the notification may be given.

(4) A notification (or variation or revocation of a notification) under this section is effective only in relation to services pro- vided after it is given.
This section does not apply if a person is a wholesale client by reason of being an eligible investor.

Section 5G: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(5) 5H Giving revocation of certification or notification of opt out (1) A revocation of a certification under section 5F or a notifica- tion under section 5G is sufficiently given to a financial adviser or broker if— (a) (b) provided to the financial adviser or broker; or delivered or posted to the financial adviser or broker at the person’s business address stated on the register under the FSP Act or (if not registered) the person’s last known place of business in New Zealand; or sent by fax or email to the person’s fax number or email address stated on the register under the FSP Act.
The revocation or notification is treated as received by the per- son no later than 7 days after it is posted or 2 days after it is faxed or emailed, unless the person to whom it is posted or sent proves that it was not received (otherwise than through fault on the person’s part).

Section 5H: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) (c) 5I Meaning of acting on behalf of B’s business and acting through A In this Act, a person (A) provides services acting on behalf of the business of another person (B) or on behalf of B’s business if— (a) A is a director, an employee, or an agent (including a nominated representative or a contractor) of B and is acting within the scope of his or her actual or apparent authority; or (1) 32 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 7 (b) A is acting at the direction or with the consent or agree- ment (whether express or implied) of— (i) (ii) B; or a director, an employee, or an agent (including a nominated representative or a contractor) of B and the direction, consent, or agreement given is within the scope of the actual or apparent author- ity of the director, employee, or agent.
(2) If A is providing services on behalf of B’s business, then B is acting through A to provide those services.

Section 5I: inserted, on 1 July 2010, by section 9 of the Financial Advisers Amendment Act 2010 (2010 No 40).

6 Act binds the Crown This Act binds the Crown.

Part 2 Financial advisers and their disclosure and conduct obligations 7 (1) (2) (3) (4) Outline This Part is divided into 3 subparts.
Subpart 1 defines what a financial adviser service is and what financial advice is, and other key related definitions.

Subpart 1A sets out the restrictions on providing financial ad- viser services and the restrictions on persons holding them- selves out as certain kinds of advisers.

Subpart 2 describes the disclosure and conduct obligations of a financial adviser under this Act and when they apply.
Section 7: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Subpart 1—Key definitions for financial adviser services Subpart 1: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

33 Part 2 s 8 Financial Advisers Act 2008 Reprinted as at 7 July 2010 What are financial adviser services inserted, on 1 July 2010, by section 10 of the Financial Advisers Heading: Amendment Act 2010 (2010 No 40).
Who is financial adviser 8 (1) A financial adviser is a person who provides a financial adviser (2) service.

See section 16 for the types of financial advisers and sections 20D to 20F for how the Act’s requirements apply in the case of a person who provides a financial adviser service on behalf of another person’s business.

Section 8: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
What is financial adviser service 9 (1) A person (A) provides a financial adviser service if, in the ordinary course of a business, A provides any of the services listed in subsection (3) to a client.

(3) (2) A person (A) also provides a financial adviser service if, in the course of business of a financial service provider registered under the FSP Act, A provides any of the services in subsection (3) to a client.
The services are— (a) (b) giving financial advice (see section 10): providing an investment planning service (see section 11): providing a discretionary investment management ser- vice (see section 12).

(c) (4) A person does not provide a financial adviser service for the purposes of this Act if exempted under section 13, 14, or 148 or in the regulations.

Section 9: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
10 When person gives financial advice (1) A person (A) gives financial advice if A makes a recommen- dation or gives an opinion in relation to acquiring or disposing of (including refraining from acquiring or disposing of) a fi- nancial product.

34 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 11 (2) Whether or not advice is financial advice for the purposes of this Act is not affected by how the advice is given or commu- nicated.
(3) However, a person does not give financial advice for the pur- poses of this Act merely by— (a) providing information (for example, the cost or terms and conditions of a financial product); or (b) making a recommendation or giving an opinion relating to a class of financial products; or (d) (c) making a recommendation or giving an opinion about the procedure for acquiring or disposing of a financial product; or transmitting the financial advice of another person (un- less A gives A’s own financial advice in doing so or holds out the transmitted financial advice as A’s own financial advice); or (e) recommending that a person consult a financial adviser.
Section 10: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
11 When person provides investment planning service (1) A person (A) provides an investment planning service if A designs, or offers to design, a plan for an individual that— (a) is based on, or purports to be based on, an analysis of the individual’s current and future overall financial situ- ation (which must include his or her investment needs) and identification of the individual’s investment goals; and includes 1 or more recommendations or opinions on how to realise those goals (or 1 or more of them).
(b) (2) A service may be an investment planning service regardless of whether the analysis and identification is of the individual’s particular financial situation and goals or of the financial situ- ations and goals attributable to the class of persons that the individual is identified as coming within.

Section 11: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
35 Part 2 s 12 Financial Advisers Act 2008 Reprinted as at 7 July 2010 12 When person provides discretionary investment management service (1) A person (A) provides a discretionary investment management service if A— (a) (b) decides which financial products to acquire or dispose of on behalf of a client (B); and in doing so is acting under an authority granted to A (or A’s employer or principal) to manage some or all of B’s holdings of financial products.
(2) In determining whether A has that authority, it does not matter if B has the right to be consulted on, or to countermand, A’s decisions.

Section 12: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Exemption for incidental service 13 (1) A service is not a financial adviser service for the purposes of this Act if the service is provided only as an incidental part of another business that is not otherwise a financial service or does not have, as its principal activity, the provision of another financial service.
In addition, a service is not a financial adviser service if— (a) (2) it is provided in connection with providing credit under a credit contract; and both the service and the credit are provided as an inci- dental part of another business that is not otherwise a financial service or does not have, as its principal activ- ity, the provision of another financial service.
(b) In this section, a service is incidental to another business if it is carried on to facilitate the carrying out of another business, or is ancillary to another business.

Regulations may declare a class of service provided in the course of a class of business to be incidental, or that a class of business is not a financial service, for the purposes of sub- section (1).

Section 13: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(3) (4) 36 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 14 Other exemptions 14 (1) None of the following is a financial adviser service for the purposes of this Act: (a) (b) (c) (d) (e) (f) Other occupations a teacher, lecturer, journalist, or State services employee providing a relevant service in the course of that occu- pation: a Minister of the Crown providing a relevant service in the course of his or her duties as a Minister of the Crown: a member of Parliament providing a relevant service in the course of his or her duties as a member of Parlia- ment: a lawyer, incorporated law firm, conveyancing prac- tax agent, real estate titioner, chartered accountant, agent, registered legal executive, registered valuer, or any other exempted class of service provider (as speci- fied in the regulations) providing a relevant service in the ordinary course of business of that kind: Crown-related organisations and other statutory officers and organisations a statutory officer, a Crown organisation (other than Public Trust), or the Reserve Bank of New Zealand— discharging any duties or exercising any powers (i) of the statutory officer, the Crown organisation, or the Reserve Bank of New Zealand under any enactment; or doing anything that is incidental to the discharge of the functions of the statutory officer, the Crown organisation, or the Reserve Bank of New Zealand under any enactment: (ii) Non-profit organisations, workplace financial products, and trustee corporations a non-profit organisation providing a relevant service if the relevant service is provided, without charge, in the course of the organisation’s activities: 37 Part 2 s 14 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (g) (h) (i) (j) (k) (l) (m) an employer providing a relevant service to an em- ployee in connection with a financial product made available through the employee’s workplace: a trustee corporation providing a relevant service in the ordinary course of providing— (i) legal or financial services relating to the
 prepar- ation or drafting of a will; and estate management and administration services (and associated legal, financial, and other ser- vices carried out under the relevant enactment governing the trustee corporation): (ii) Activities governed by other regulatory frameworks a principal officer of any entity providing a relevant ser- vice in the person’s capacity as a principal officer: the offeror or target company providing a relevant service in the course of a takeover offer under the Takeovers Code: an independent adviser providing a relevant service in the course of that person’s functions under the Takeovers Code: an approved rating agency providing a relevant service in connection with a rating given or to be given by it: any form of communication made by or on behalf of an issuer that is contained in, or given in connection with, an offer of securities that— (i) does not constitute an offer of securities to the public under section 3 of the Securities Act 1978; or is exempt from Part 2 (other than sections 38B and 58) of that Act under section 5(2CB) or 5(2CBA) of that Act: (ii) (n) (o) a person providing a relevant service in the course of carrying on a business of dealing in futures contracts within the scope of an authorisation under section 38(1)(a) of the Securities Markets Act 1988 or an approval under section 38(1)(b) of that Act: Documents required by law providing or making available to a person any of the following documents or information: 38
 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 15 (i) (ii) (iii) a prospectus, an investment statement, or an ad- vertisement within the meaning of section 2A of the Securities Act 1978: a document or information that is required by law to be provided or made available (for example, an annual report of a company), whether directly or as a condition of carrying out any activity or as a condition of an exemption from any enactment: any other exempted document or information (as specified in
 the regulations): Services provided to product provider a person providing a relevant service to a product provider in connection with a financial product of that provider in the course of an appointment by, or under a contract for services with, the product provider: Other exemptions in regulations any other person providing a relevant service in circum- stances exempted under the regulations.
(p) (q) (2) (3) If subsection (1) applies to a person (A), it applies equally to any controlling owner, director, employee, agent, or other person acting in the course of, and for the purposes of, A’s business to the same extent as it applies to A.

In this section, relevant service means a service that, but for subsection (1), would be a financial adviser service.

Section 14: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
When financial adviser service is personalised service or class service Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 10 of the Financial Advisers 15 When financial adviser service is personalised service or class service (1) A financial adviser service is a personalised service if— (a) (b) it is given to, or in respect of, a named client or a client that is otherwise readily identifiable by the financial ad- viser; and either— 39 Part 2 s 16 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (i) (ii) the financial adviser has taken into account the client’s particular financial situation or goals (or any 1 or more of them) in providing the service; or a client would, in the circumstances in which the service is provided, reasonably expect the finan- cial adviser to take into account the client’s par- ticular financial situation or goals (or any 1 or more of them).
(2) A service is not personalised merely because the client comes within a class of persons having predefined characteristics and the financial adviser takes the fact that the client comes within that class into account.

(3) A financial adviser service is a class service if it is not a per- sonalised service.

Section 15: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Subpart 1A—Restrictions on providing financial adviser services Subpart 1A: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Types of financial adviser Under this Act, there are the following types of financial ad- viser: (a) (b) (c) (d) an authorised financial adviser: an individual who is registered but not authorised: a QFE adviser: a QFE or any other entity that is registered but does not have QFE status: any other person (whether an individual or an entity) who is an exempt provider.

(e) Section 16: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
16 40 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 18 Restrictions on providing financial adviser services Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 10 of the Financial Advisers (a) 17 Who may provide financial adviser service (1) A person must not provide a financial adviser service unless— the person is permitted to provide that service under sections 18 to 20; or the person is— (i) (ii) registered or an exempt provider; and acting through a person to whom paragraph (a) applies (other than a QFE adviser); or (b) (2) (c) the person is a QFE or a member of a QFE group acting through a QFE adviser to whom paragraph (a) applies.
Contraventions of this section may give rise to an offence (see section 114).

Section 17: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
18 Who is permitted to provide personalised service to retail (1) clients The following individuals are permitted to provide a person- alised service to a retail client: (a) if giving financial advice or providing a discretionary investment management service in relation to a cat- egory 1 product,— (i) (ii) an authorised financial adviser: a QFE adviser (but only if the QFE or a member of the QFE group is the product provider (or, in the case of a security, a promoter) of the relevant category 1 product): (b) (c) if providing an investment planning service, an author- ised financial adviser: if giving financial advice or providing a discretionary investment management service in relation to a cat- egory 2 product,— (i) (ii) an authorised financial adviser: a registered individual: 41 Part 2 s 19 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (iii) a QFE adviser.
(2) Subsection (1)(a)(ii) is subject to any limitation on the scope of services that may be provided by the QFE adviser under the terms and conditions for the QFE under section 67A or a determination under section 75B(4).

Section 18: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
19 Who is permitted to provide class service to retail clients The following persons are permitted to provide a class service to a retail client: (a) (b) (c) (d) an authorised financial adviser: a QFE adviser: a registered person (whether an individual or an entity): an exempt provider (whether an individual or an entity), other than an overseas financial adviser (see paragraph (a) of the definition of exempt provider in section 5).
Section 19: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

20 Who is permitted to provide financial adviser service to wholesale clients The following persons are permitted to provide a financial ad- viser service to a wholesale client: an authorised financial adviser: (a) a QFE adviser: (b) a registered person (whether an individual or an entity): (c) (d) an exempt provider (whether an individual or an entity).
Section 20: substituted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Restrictions on holding out Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 10 of the Financial Advisers 42 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 20C 20A Who may hold themselves out as authorised financial adviser (1) A person (A) must not hold out (whether directly or indirectly) that A or any other person (B) is an authorised financial adviser unless A or B (as applicable) is an authorised financial adviser.

Contraventions of this section may give rise to an offence (see section 115).
Section 20A: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 20B Who may hold themselves out as financial planner or investment planner (1) A person (A) must not hold out (whether directly or indirectly) (b) that A or any other person (B) is— (a) a financial planner or an investment planner unless A or B (as applicable) is an authorised financial adviser who is authorised to provide investment planning services under section 55: offering a financial or an investment planning service unless A or B (as applicable) is— (i) an authorised financial adviser who is authorised to provide investment planning services under section 55; or acting through an authorised financial adviser who is so authorised.
(ii) (2) Contraventions of this section may give rise to an offence (see section 115).

Section 20B: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

20C Who may hold themselves out as QFE or having QFE status (1) A person (A) must not hold out (whether directly or indirectly) that A or any other person (B) is a QFE or has QFE status unless A or B (as applicable) is a QFE or a partner entity.
Contraventions of this section may give rise to an offence (see section 115).

Section 20C: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(2) 43 Part 2 s 20D Financial Advisers Act 2008 Reprinted as at 7 July 2010 Persons acting in course of business of employers and principals Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 10 of the Financial Advisers 20D Application of FSP Act to employees, etc Any person required, by this Act, to register to provide a fi- nancial adviser service must be treated, under the FSP Act, as being in the business of providing a financial service for the purposes of that Act (even if the person does not carry on that business).

Section 20D: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
20E Who must be member of dispute resolution scheme A person (A) who provides a financial adviser service on be- half of the business of another person (B) is exempt from the obligation under section 48 of the FSP Act to be a member of an approved dispute resolution scheme for the purposes of registration if— (a) B is a member of an approved dispute resolution scheme; and (b) A’s obligation to be a member of an approved dispute resolution scheme arises only by virtue of the financial adviser services provided on behalf of B’s business.
Section 20E: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).
20F Who is responsible for financial adviser obligations (1) If a financial adviser service is provided by a person (A) on behalf of the business of another person (B), the following persons are treated as the financial adviser having the financial adviser obligation under this Act: (a) if it is a personalised service provided to a retail client (unless paragraph (b) applies), both A and B: if A is a QFE adviser and B is the QFE or a member of a QFE group, B only: in any other case, B only.
(c) If B has a financial adviser obligation under subsection (1),— (b) (2) 44 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 22 (a) (b) any act or omission by A is also treated as being done by B; and if it is necessary to show the state of mind of B, it is sufficient to show that A had that state of mind.

(3) However, subsection (1) does not apply to the financial adviser (4) obligations in sections 37 and 45 (which apply to A only).
Subsections (1) to (3) do not affect the liability of A or B under any other Act or rule of law for A’s actions.

Section 20F: inserted, on 1 July 2010, by section 10 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Subpart 2—Financial advisers’ disclosure and conduct obligations Disclosure obligations for personalised services for retail clients Heading: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).
21 What is disclosure obligation and when does it apply (1) A disclosure obligation under this Part is an obligation to make disclosure under or in accordance with sections 22 to 31.

(2) A disclosure obligation applies only to a personalised service (3) provided to a retail client.

Contravention of a disclosure obligation may give rise to an offence (see section 117).

Section 21: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).
22 Financial adviser must make disclosure before providing personalised service to retail client (1) A financial adviser who provides a personalised service to a retail client must disclose prescribed information to the client, in accordance with this Act and the regulations,— (a) (b) before providing the service; or if not practicable before, as soon as practicable after providing the service.

(2) Subsection (1) does not apply to a QFE adviser acting in that capacity.
45 Part 2 s 23 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Section 22: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).

23 What financial adviser must disclose (1) Regulations for the purposes of prescribing disclosure for fi- nancial advisers under section 22 may require disclosure,— (a) for authorised financial advisers, in relation to any or all of the matters referred to in subsection (2).
for other financial advisers, in relation to any or all of the matters referred to in subsection (2)(a) to (g).
(b) (2) The matters are— (a) (b) (c) contact details: the type of financial adviser: financial adviser services provided (including financial products in relation to which a financial adviser service is provided): fees: (d) (e) material interests, relationships, or associations: (f) (g) (h) remuneration: dispute resolution arrangements: professional or business experience relevant to per- formance of a financial adviser service: criminal convictions: disciplinary proceedings: adverse findings by a court or the Commission: bankruptcy or other insolvency proceedings: indemnity insurance: (i) (j) (k) (l) (m) (n) matters required to be disclosed by the authorised finan- cial adviser’s terms and conditions of authorisation.
Section 23: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Disclosure statement 24 (1) Disclosure under section 22(1) must be made by 1 or more disclosure statements in accordance with the regulations.
(2) A disclosure statement must— (a) (b) be in writing; and state when it was prepared; and 46 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 26 (c) (d) state the name, address, trading name (if any), telephone number, fax number, and email address of the financial adviser; and be— (i) (ii) provided to the client; or delivered or sent to the client at the client’s last known address or an address (including an elec- tronic address) specified by the client for that pur- pose.
(3) Regulations may provide for the form that a disclosure state- ment must take.

Section 24: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).
25 QFE must make disclosure before personalised service provided to retail client (1) A QFE or a member of a QFE group that, acting through a QFE adviser, provides a personalised service to a retail client must ensure that prescribed information is disclosed to the client, in accordance with this Act and the regulations,— before the service is provided; or (a) if not practicable before, as soon as practicable after the (b) service is provided.
(2) (3) Regulations for the purposes of this section may require dis- closure in relation to any or all of the following matters: (a) (b) (c) (d) matters required to be disclosed by the QFE’s terms and contact details: the type of financial adviser: dispute resolution arrangements: (e) conditions of a grant of QFE status: whether the QFE or member of the QFE group provides any other licensed service.

Regulations may provide for the form that the disclosure must take.
Section 25: substituted, on 1 July 2010, by section 11 of the Financial Advisers Amendment Act 2010 (2010 No 40).
26 (1) Disclosure by qualifying financial entity This section applies— 47 Part 2 s 27 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (a) (b) if a financial adviser (A)— (i) (ii) (iii) is not an authorised financial adviser; and is an employee or agent of a QFE; and performs a financial adviser service in relation to a category 2 product in the course of the QFE’s business; or if a financial adviser (A)— (i) (ii) (iii) is not an authorised financial adviser; and is an employee of a QFE; and performs a financial adviser service in relation to a category 1 product of which the QFE is the issuer in the course of the QFE’s business.
In this section, the financial adviser service means a financial adviser service referred to in— subsection (1)(a)(iii); or (a) subsection (1)(b)(iii).

(b) In any case to which this section applies,— (a) before (or, if not practicable before, as soon as practic- able after) A performs the financial adviser service, the QFE must disclose the information prescribed by regu- lations to the person for whom the financial adviser ser- vice is performed; and (b) A has no obligation of disclosure.
For the purposes of this section, regulations may prescribe dis- closure in relation to any or all of the following matters: the QFE’s dispute resolution arrangements: (a) (b) matters required to be disclosed by the QFE’s terms and conditions of grant of QFE status: whether the QFE provides any other licensed service.

(c) Regulations may prescribe the form of disclosure.

Section 26(1): substituted, on 28 July 2009, by section 7 of the Financial Ad- visers Amendment Act 2009 (2009 No 24).
Section 26(1A): inserted, on 28 July 2009, by section 7 of the Financial Advisers Amendment Act 2009 (2009 No 24).

Disclosure must not be misleading, deceptive, or confusing Disclosure under a disclosure obligation must not be mislead- ing, deceptive, or confusing at the time that the disclosure is made.
(1A) (2) (3) (4) 27 48 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 29 Disclosure of additional information 28 (1) Disclosure of the matters that must be disclosed under a dis- closure obligation may be accompanied by disclosure of addi- tional information.

(2) Additional disclosure that accompanies disclosure under a dis- closure obligation must not be deceptive, misleading, or con- fusing at the time that it is made.
29 (1) (2) (3) No compliance with disclosure obligations if disclosure out of date Previous disclosure does not discharge a person’s disclosure obligation if the previous disclosure is out of date when the financial adviser service is performed.
The previous disclosure is out of date if— (a) since the date of the disclosure there has been a material change in any matter that must be disclosed; and a reasonable person in the position of the person for whom the financial adviser service is performed (A) would consider that the change would materially affect any of the following decisions by A: (i) (b) to proceed with a financial adviser service by the financial adviser in question (B): to proceed with financial advice already given by B: about the weight that A gives to financial advice by B: to postpone or countermand the performance of a financial adviser service.
(ii) (iii) (iv) (b) Subsection (1) does not apply if— (a) the previous disclosure was by way of a disclosure state- ment; and before the financial adviser service is performed, B gives A— (i) (ii) a new disclosure statement that is up to date; or additional written information that, when read with the original disclosure statement, updates the disclosure statement.
49 Part 2 s 30 Financial Advisers Act 2008 Reprinted as at 7 July 2010 30 31 (1) Advertisement advertising financial adviser services by authorised financial adviser must refer to disclosure statement Any advertisement advertising financial adviser services by an authorised financial adviser must state that a disclosure state- ment is available, on request and free of charge.
Disclosure by 2 or more financial advisers in joint disclosure statement Subject to regulations being made under subsection (3), dis- closure may be made by 2 or more financial advisers in a joint disclosure statement.
(2) A joint disclosure statement must— (a) (b) (c) comply with section 24(2)(a) to (c); and comply with regulations prescribing the form of the joint disclosure statement; and be— (i) (ii) provided to the client; or delivered or sent to the client at the client’s last known address or an address (including an elec- tronic address) specified by the client for that pur- pose.
Regulations may prescribe— (a) when, and subject to what terms and conditions, disclos- ure may be made in a joint disclosure statement; and the form of a joint disclosure statement.

(b) Section 31(2)(c): substituted, on 1 July 2010, by section 12 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(3) Conduct obligations 32 What is conduct obligation and when does it apply (1) A conduct obligation under this Part is an obligation under sections 33 to 48.
The conduct obligations in— (a) (b) sections 33 to 35 apply to all financial adviser services: section 36 applies to a class service provided to a retail client: (2) 50 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 34 (c) (d) sections 37, 38, 45, and 45A apply to an authorised financial adviser, irrespective of the type of service: sections 46 to 48 apply to a QFE and (in some cases) members of a QFE group, irrespective of the type of service.
Section 32: substituted, on 1 July 2010, by section 13 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Conduct obligations that apply to all financial advisers [Repealed] Heading: repealed, on 1 July 2010, by section 13 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) Financial adviser must exercise care, diligence, and skill 33 (1) A financial adviser, when providing a financial adviser service, must exercise the care, diligence, and skill that a reasonable financial adviser would exercise in the same circumstances.
In determining the degree of care, diligence, and skill that a reasonable financial adviser would exercise, the following matters must be taken into account (without limitation): (a) the nature and requirements of the financial adviser’s client or (if it is a class service) of the clients intended to receive the service; and the nature of the service provided and the circumstances in which the service is provided; and the type of financial adviser.
(c) Section 33: substituted, on 1 July 2010, by section 13 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(b) 34 Financial adviser must not engage in misleading or deceptive conduct (1) A financial adviser must not engage in conduct in relation to the provision of a financial adviser service that is misleading or deceptive or likely to mislead or deceive.

(2) A person who knowingly or recklessly contravenes subsection (1) commits an offence (see section 118).
Compare: 1988 No 234 s 13(1) Section 34(1): amended, on 1 July 2010, by section 14 of the Financial Advisers Amendment Act 2010 (2010 No 40).

51 Part 2 s 35 Financial Advisers Act 2008 Reprinted as at 7 July 2010 35 Advertisement by financial adviser must not be misleading, deceptive, or confusing (1) A financial adviser must not advertise a financial adviser ser- vice in a way that is misleading, deceptive, or confusing.
(2) A person who knowingly or recklessly contravenes subsection (1) commits an offence (see section 119).
36 37 38 Regulations may impose specific conduct obligations for class services to retail clients A financial adviser must, when providing a class service to a retail client, comply with any 1 or more of the following requirements that apply under the regulations (if any): (a) ensure that the prescribed warning is given in the pre- scribed manner that the class service is not personalised: ensure compliance with the prescribed requirements re- lating to the competency of, or the use of adequate care, diligence, and skill by, the persons involved in provid- ing the service (for example, a requirement to obtain a certificate from the principal officers of the adviser or a requirement to obtain the approval of financial advice by an authorised financial adviser or individual regis- tered financial adviser): comply with any prescribed record-keeping or proced- ural requirements relating to those matters.
(b) (c) Section 36: substituted, on 1 July 2010, by section 15 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Conduct obligations that apply to authorised financial advisers only Authorised financial adviser must comply with code An authorised financial adviser must comply with the code.
Authorised financial adviser must not recommend acquisition of securities if offer for subscription illegal (1) An authorised financial adviser (A) must not recommend to a person that that person acquire securities if— (a) when the securities were or are offered for subscription, the offer was or is illegal; and the illegality has not been remedied; and (b) 52 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 43 (c) A knows or ought to know that, when the securities were or are offered for subscription, the offer was or is illegal.
(2) A person who contravenes subsection (1) commits an offence (see section 121).

Compare: 1988 No 234 s 41S Section 38 heading: amended, on 1 July 2010, by section 16(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 38(1): amended, on 1 July 2010, by section 16(2) of the Financial Ad- visers Amendment Act 2010 (2010 No 40).
Authorised financial adviser must pay client’s money into separate trust account [Repealed] Section 39: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Authorised financial adviser must account for client’s money or property [Repealed] Section 40: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Authorised financial adviser must keep records of client’s money and other property [Repealed] Section 41: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Restrictions on use of client’s money or property [Repealed] Section 42: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Protection of client’s money or property held on trust [Repealed] Section 43: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).

39 40 41 42 43 53 Part 2 s 44 Financial Advisers Act 2008 Reprinted as at 7 July 2010 44 Meaning of received or held [Repealed] Section 44: repealed, on 1 July 2010, by section 17 of the Financial Advisers Amendment Act 2010 (2010 No 40).
45 Authorised financial adviser must comply with terms and conditions of his or her authorisation (1) An authorised financial adviser must comply with the terms and conditions of his or her authorisation.

(2) A person who contravenes subsection (1) commits an offence (see section 126).
45A Authorised financial adviser may report breach of Act to Commission If an authorised financial adviser (A) reasonably believes that a person has breached this Act or an obligation imposed under this Act (including the code) in a material respect, A may, as soon as practicable, report the breach to the Commission.
If A makes a report under subsection (1) in good faith,— (a) (b) (c) (d) no civil, criminal, or disciplinary proceedings may be brought against A in respect of the report: no person may terminate the appointment or employ- ment of A by reason of the report: no tribunal, body, or authority that has jurisdiction in respect of the professional conduct of A may make an order against, or do any act in relation to, A in respect of the report: the Commission must not disclose information that might identify A unless— (i) A consents in writing to the disclosure of the in- formation; or the Commission believes that disclosure of the information is essential to the effective investi- gation of the alleged breach or is otherwise es- sential, having regard to the principles of natural justice.
(ii) If A makes a report under subsection (1) (whether or not in good faith), the Commission must not disclose information that might identify a client of A unless— (1) (2) (3) 54 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 2 s 47 (a) (b) the client consents in writing to the disclosure of the information; or the Commission believes that disclosure of the infor- mation is essential to the effective investigation of the alleged breach or is otherwise essential, having regard to the principles of natural justice.
Section 45A: inserted, on 1 July 2010, by section 18 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Conduct obligations related to QFEs Heading: substituted, on 1 July 2010, by section 19 of the Financial Advisers Amendment Act 2010 (2010 No 40).

QFE must comply with terms and conditions of grant of QFE status Every QFE and every partner entity of a QFE must comply with the terms and conditions of the QFE’s grant of QFE status.
Contraventions of this section give rise to the offences de- scribed in section 129.

Section 46: substituted, on 1 July 2010, by section 19 of the Financial Advisers Amendment Act 2010 (2010 No 40).
QFE or member of QFE group must not engage in misleading or deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative 46 (1) (2) 47 (1) A QFE or a member of a QFE group must not, in acting through an employee, agent, or nominated representative, engage in conduct in relation to a financial adviser service that is misleading or deceptive or likely to mislead or deceive.

Contraventions of this section give rise to the offences de- scribed in section 130.
Section 47: substituted, on 1 July 2010, by section 19 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(2) 55 Part 2 s 48 Financial Advisers Act 2008 Reprinted as at 7 July 2010 48 Advertisement by QFE or member of QFE group in relation to financial adviser service must not be misleading, deceptive, or confusing (1) A QFE or a member of a QFE group must not advertise a financial adviser service in a way that is misleading, deceptive, or confusing.
Contraventions of this section give rise to the offences de- scribed in section 131.

Section 48: substituted, on 1 July 2010, by section 19 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) Commission’s direction in respect of breach of disclosure or conduct obligation 49 (1) (2) (3) (4) Commission may give financial adviser direction in respect of breach of disclosure or conduct obligation This section applies if the Commission has reason to believe that a financial adviser is in breach of a disclosure or conduct obligation.
The Commission may give the financial adviser notice of his or her alleged breach and, if the Commission does give a notice of breach, the Commission must also give the financial adviser a reasonable opportunity to respond.

If the Commission concludes, after considering the financial adviser’s response, that the financial adviser is in breach, the Commission may give the financial adviser a direction in writ- ing.
The direction may— (a) direct the financial adviser to comply with the conduct or disclosure obligation: stipulate any steps that the financial adviser must take in order to comply with the obligation: require the financial adviser to report to the Commis- sion within 28 days of the date of the direction stating how and when the Commission’s direction will be im- plemented.

(b) (c) (5) A financial adviser who fails to comply with a direction by the Commission commits an offence (see section 135).
56 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 54 (6) Nothing in this section precludes the Commission from exer- cising any of its other powers under this Act against a financial adviser.

Part 3 Authorised financial advisers and qualifying financial entities 50 (1) (2) (3) Outline of this Part This Part is divided into 2 subparts.
Subpart 1 describes who is an authorised financial adviser, how a person is authorised, and the powers of the Commis- sion in relation to an authorised financial adviser.

Subpart 2 describes what is a qualifying financial entity (a QFE), how an entity achieves QFE status, and the powers of the Commission in relation to a QFE.

Subpart 1—Authorised financial advisers 51 Who is authorised financial adviser An authorised financial adviser is an individual who is— (a) (b) registered; and authorised.
52 Who may apply to be authorised Any individual may apply to the Commission to be authorised.

53 54 Application to be authorised An application to be authorised must be— in the prescribed form (if any); and (a) accompanied by the prescribed fee (if any).
(b) Eligibility to be authorised A person (A) is eligible to be authorised if— the Commission is satisfied that— (a) (i) A is registered or complies with section 13(a) and (b) of the FSP Act; and (ii) A is a person of good character; and 57 Part 3 s 55 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (iii) A meets the levels of competency, knowledge, and skills specified in the code for an authorised financial adviser; and (iv) A is not debarred from applying for authorisa- tion; and (b) the Commission— (i) is not aware, after making any inquiries that it considers appropriate, that A has been convicted by a court in New Zealand or elsewhere of an offence punishable by imprisonment for a term of 6 months or more; or if the Commission is so aware, is satisfied that the commission of the offence does not reflect adversely on A’s fitness to act as an authorised financial adviser.
(ii) Section 54(b)(i): amended, on 1 July 2010, by section 20 of the Financial Ad- visers Amendment Act 2010 (2010 No 40).
Commission must approve or decline application for authorisation If an applicant for authorisation is eligible, the Commission must authorise that person in respect of 1 or more of the fol- lowing for a specified period: (a) providing any financial adviser service, or specified kinds of financial adviser services, in relation to any category 1 product, specified category 1 products, or specified classes of category 1 product: providing a discretionary investment management ser- vice on behalf of clients, generally or in specified cases, in relation to any category 1 product, specified category 1 products, or specified classes of category 1 product: providing investment planning services generally or in specified cases: providing, in any case that is specified in the regula- tions for the purposes of this paragraph, services of the kind referred to in paragraph (a) or (b) or both, but in relation to any category 2 product, specified category 2 products, or specified classes of category 2 products.
(b) (c) (d) 55 (1) 58 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 55A (2) (3) (4) (5) (6) the authorisation; and the terms and conditions (if any); and the period of authorisation.

The authorisation may be subject to terms and conditions relat- ing to financial adviser services or broking services or to both.
If the Commission approves the application, the Commission must notify the applicant in writing of— (a) (b) (c) The Commission may incorporate, with any modifications it considers appropriate, the standard conditions.

If an applicant for authorisation is not eligible, the Commis- sion must— (a) (b) decline the application; and notify the applicant in writing of— (i) (ii) the decision and the reasons for it; and the applicant’s right of appeal against the deci- sion.
Subsection (1)(d) does not limit or affect anything in section 18.

Section 55: substituted, on 1 July 2010, by section 21 of the Financial Advisers Amendment Act 2010 (2010 No 40).

55A Variation of terms and conditions and period of authorisation (2) (3) (1) An authorised financial adviser may apply to the Commission for a variation of the terms and conditions of the adviser’s authorisation.

The Commission may grant or decline the application.
The Commission may, by notice to an authorised financial ad- viser, propose a variation of the terms and conditions of the adviser’s authorisation or the period of the adviser’s author- isation, or both, on either or both of the following grounds: (a) the business of the adviser has changed in a way that poses a material risk to consumers: the adviser has been involved in market practices that are, in material respects, inconsistent with the purpose of this Act.
(b) (4) The Commission must specify in the notice a reasonable period for the adviser to respond in writing.

59 Part 3 s 56 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (5) After considering any response received within the period spe- cified in the notice, the Commission may, by notice to the ad- viser, vary the terms and conditions of the adviser’s authorisa- tion or the period of the adviser’s authorisation, or both.
The Commission may, in the notice under subsection (5), vary terms and conditions on a provisional basis and, if it does so, must, in the light of any changes in risk posed by the adviser’s business or market practices, review those terms and condi- tions by a date stated in the notice.
(6) (7) On completion of the review, the Commission may do any of the following: (a) (c) (b) confirm 1 or more of the variations effected by subsec- tion (5): cancel 1 or more of the variations effected by subsection (5): propose further terms and conditions by giving the au- thorised financial adviser a notice under subsection (3).

The Commission must give the authorised financial adviser notice of any decision taken under subsection (7)(a) or (b).
Section 55A: inserted, on 1 July 2010, by section 21 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Commission must notify Registrar of authorisation If the Commission authorises the applicant, the Commission must notify the Registrar in writing of— (a) (b) the name and business address of the applicant; and the terms and conditions (if any) of the authorisation; and the period of authorisation.
(c) The Commission may publicly notify the authorisation and the other matters referred to in subsection (1) as it thinks fit.
(8) 56 (1) (2) Termination of authorisation 57 (1) A person’s authorisation as an authorised financial adviser ter- minates when— (a) the period of authorisation (including any extension under section 58(5)) expires; or 60 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 58 (b) (c) (d) the Commission receives a written request from the per- son requesting the Commission to cancel his or her au- thorisation; or the person ceases to be registered; or the Commission cancels his or her authorisation under section 59(2).
(2) The Commission must notify the Registrar in writing of ter- mination of authorisation under subsection (1)(a), (b), or (d).

Renewal of authorisation 58 (1) An authorised financial adviser may apply for renewal of au- thorisation.

(3) accompanied by the prescribed fee (if any).


(2) An application for renewal of authorisation must be— (a) made in the prescribed form (if any); and (b) Subject to subsection (4), sections 52 to 56 apply, with any necessary modifications, to an application for renewal of au- thorisation.
In addition to the matters specified in section 54, the Commis- sion must be satisfied that— (a) (4) the applicant for renewal of authorisation has complied with the Act, the terms and conditions of authorisation, and the minimum professional standards for authorised financial advisers prescribed by the code; or any failure, on the part of the applicant, to comply is not sufficiently serious or recent to preclude the renewal of the applicant’s authorisation.
(b) (5) (6) If an application for renewal of authorisation has been made but not determined before the date on which the authorisation is due to expire, the authorisation continues in force until the application is determined.

The renewal of authorisation takes effect from the date of ex- piry of the previous authorisation.

Section 58(4): substituted, on 1 July 2010, by section 22 of the Financial Ad- visers Amendment Act 2010 (2010 No 40).
61 Part 3 s 59 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Commission’s powers in relation to default by authorised financial adviser Commission’s powers in relation to default by authorised financial adviser This section applies if the Commission is satisfied that an au- thorised financial adviser (A)— (a) (b) has ceased to be eligible for authorisation; or has breached or is in breach of this Act (excluding sec- tion 37) or the regulations; or has breached or is in breach of a term or condition of his or her authorisation; or is the subject of a recommendation by the disciplinary committee under section 101(3)(a), (b), or (c); or has failed to pay a fee or levy as required by this Act or the regulations.
(c) (d) (e) (c) In any case to which this section applies, the Commission may, after following the procedure set out in section 60 and subject to subsection (3),— (a) (b) cancel the authorisation; or cancel the authorisation and debar A for a specified period from re-applying for authorisation; or suspend the authorisation for a specified period or until A does any thing that the Commission may specify; or amend the terms and conditions of the authorisation; or (d) (e) make no order.
The Commission may only take 1 of the actions specified in subsection (2).

If the Commission cancels or suspends the authorisation of an authorised financial adviser, the Commission must notify the Registrar in writing of the cancellation or suspension, and, in the case of suspension, the period of suspension.

The Commission may publicly notify the action it takes under subsection (2) as it sees fit.
Reasonable opportunity to be heard The Commission must not take any of the actions specified in section 59(2) unless it has first— 59 (1) (2) (3) (4) (5) 60 62 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 61 (a) (b) informed the person concerned in writing as to why it may take any of those actions; and given that person or his or her representative a reason- able opportunity to make written submissions and be heard on the question.
61 (1) (2) (3) (4) Commission may give authorised financial adviser direction This section applies if the Commission has reason to believe that an authorised financial adviser is in breach of the terms and conditions of his or her authorisation (the terms and con- ditions).

The Commission may give the financial adviser notice of his or her alleged breach and, if the Commission does give a notice of breach, the Commission must also give the financial adviser a reasonable opportunity to respond.
If the Commission concludes, after considering the financial adviser’s response, that the financial adviser is in breach, the Commission may give the financial adviser a direction in writ- ing.
The direction may— (a) direct the financial adviser to comply with the terms and conditions: stipulate any steps that the financial adviser must take in order to comply with the terms and conditions: require the financial adviser to report to the Commis- sion within 28 days of the date of the direction stating how and by when the Commission’s direction will be implemented.
(b) (c) (5) An authorised financial adviser who fails to comply with a direction by the Commission commits an offence (see section 127).

(6) Nothing in this section precludes the Commission from exer- cising any of its other powers under this Act against an author- ised financial adviser.
63 Part 3 s 62 Financial Advisers Act 2008 Reprinted as at 7 July 2010 62 Other provisions concerning Commission’s powers in relation to default by authorised financial adviser (1) At the end of a period of suspension of authorisation, the person’s authorisation is immediately revived, unless his or her authorisation has been further suspended or has been cancelled.
Suspension or cancellation under section 59(2) is effective when a written notice of the suspension or cancellation is sent to the person concerned by the Commission.

(2) Subpart 2—Qualifying financial entities 63 What is qualifying financial entity (QFE) (1) A QFE is— (2) (3) (a) (b) an entity that is registered and has QFE status; or a number of partner entities that are each registered and jointly have QFE status.
For the purposes of any powers or rights conferred, or obliga- tions or liabilities imposed, on QFEs by this Act, a QFE de- scribed in subsection (1)(b) is taken to be a separate entity and a person.

Subsection (2) does not limit any obligation or liability im- posed on a partner entity.

Section 63: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
64 Who may apply for QFE status An application may be made to the Commission by— a single entity for QFE status; or (a) (b) 2 or more related bodies corporate for joint QFE status.

Section 64: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Application for QFE status 65 (1) An application for QFE status must— be in the prescribed form (if any); and (a) (b) be accompanied by the prescribed fee (if any).
If the applicant or applicants seek to have 1 or more entities approved as associated entities of the proposed QFE, the ap- (2) 64 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 66 (3) 66 (1) (2) plication must state the name of each entity sought to be ap- proved as an associated entity and how that entity is connected to the applicant or applicants.
The application must set out the procedures that the applicant or applicants have for— (a) (b) training employees and nominated representatives; and setting standards for employees and nominated repre- sentatives; and (c) monitoring those standards.

Section 65: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(b) (c) Eligibility for QFE status The Commission may confer QFE status on a single entity applying under section 64(a) or on 2 or more entities applying under section 64(b) if it is satisfied that— (a) each entity is registered or is entitled to be registered; and no entity is debarred from applying for QFE status; and on the grant of QFE status and at all times while a QFE, the single entity that will be the QFE has, or the partner entities that will be the QFE together have, the capacity to, and will,— (i) discharge its or their ongoing compliance obliga- tions under section 76 and all other obligations on it under this Act or the regulations (other than any broker obligations); and comply with the terms and conditions (if any) of the grant of QFE status; and (ii) (iii) maintain procedures to ensure that retail clients of the QFE receive adequate consumer protec- tion.
In determining under subsection (1)(c) whether clients receive adequate consumer protection, the Commission must, in rela- tion to QFE advisers who provide personalised services that relate to category 1 products,— (a) consider whether the clients will receive protection of a similar standard to that provided by advisers who are subject to the code; and 65 Part 3 s 67 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (b) in doing so, take into account the scope of category 1 products in respect of which those QFE advisers pro- vide financial adviser services.
Section 66: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Commission must approve or decline application for QFE status If an applicant under section 64(a) is eligible, or if applicants under section 64(b) are eligible, for QFE status, the Commis- sion must approve the application and grant the applicant or the applicants QFE status.

The grant of QFE status is subject to the terms and conditions specified or incorporated in the grant.
The Commission may incorporate, with any modifications it considers appropriate, the standard conditions.

If the application also asks for the approval of 1 or more en- tities as associated entities of the QFE, the Commission may approve an entity as an associated entity of the QFE if that en- tity— (a) (b) is registered or is entitled to be registered; or is, under the FSP Act, an affiliated entity of one of the applicants; or is an exempt provider.
(c) Even though an entity is eligible under subsection (4), the Commission may decline to approve the entity for any reason, including, without limitation,— (a) the absence of a direct connection between the entity and the QFE or any of its partner entities; or concerns specified under section 67A(2) that cannot be adequately addressed by the imposition of terms and conditions under section 67A(4).
(b) The Commission is not precluded from approving an entity as an associated entity of a QFE merely because the entity is, or is proposed to be, the associated entity of another QFE.

Section 67: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
67 (1) (2) (3) (4) (5) (6) 66 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 68 67A Associated entities may be subject to special terms and (1) (2) (3) conditions in certain cases This section applies if— (a) (b) an application for QFE status asks for the approval of an entity as an associated entity; but the Commission has concerns about the provision of personalised services in relation to certain category 1 products by individuals who would, following the ap- proval of the entity, be the entity’s QFE advisers.
The Commission may specify its concerns in a notice to the applicant or applicants.

The Commission must specify in the notice a reasonable period for the applicant or applicants to respond in writing and must ask the applicant or applicants to satisfy the Commission that the QFE advisers of the proposed associated entity are able to, and will, provide financial adviser services in relation to the category 1 product concerned with the appropriate level of professionalism and competence.
(4) After considering the entity’s response, the Commission may make its approval of the entity as an associated entity subject to special terms and conditions, which form part of the terms and conditions specified under section 67(2).
The terms and conditions referred to in subsection (4) may, without limitation, relate to— (a) (5) the kinds of financial adviser services that may be pro- vided by or on behalf of the associated entity: any conditions and restrictions that are to apply to the provision of those services: the way in which the QFE is to supervise the associated entity.

(b) (c) Section 67A: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
68 (1) Determination of application If the Commission approves an application for a grant of QFE status, the Commission must notify the entity or entities in writing of— (a) (b) the grant of QFE status; and the terms and conditions; and 67 Part 3 s 69 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (2) the period for which QFE status has been granted.
(c) If an applicant under section 64(a) is not, or 1 or more of the applicants under section 64(b) are not, eligible for QFE status, the Commission must— (a) (b) decline the application; and notify the entity or entities of— (i) (ii) the decision and the reasons for it; and the right of an applicant under section 64(a) to appeal, and the right of applicants under section 64(b) jointly to appeal, against the decision.
Section 68: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(2) Name of QFE group 69 (1) A QFE group has the name that is approved by the Commis- sion and chosen by the applicant or applicants for QFE status that results in the formation of the group.

Every application for QFE status that would, if approved, re- sult in the formation of a QFE group must submit a name for the proposed group.
The Commission may ask the applicant or applicants to submit another name.

Section 69: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(3) Commission must notify Registrar of grant of QFE status If the Commission grants an entity or entities QFE status, the Commission must notify the Registrar in writing of— (a) the name of the entity, or the names of the partner en- tities, granted QFE status: the period for which QFE status has been granted: if a QFE group has been formed, the name of the group: if associated entities of the QFE have been approved, the names of those entities.
(b) (c) (d) The Commission may publicly notify the grant of QFE status and the other matters referred to in subsection (1) as it thinks fit.

Section 70: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
70 (1) (2) 68 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 72 71 (1) (2) (3) (4) (5) 72 Commission’s powers in relation to default by QFE [Repealed] Heading: repealed, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Addition of associated entities The QFE of a QFE group may apply to the Commission to approve the addition of 1 or more entities as associated entities of the QFE.
The application must— (a) (b) (c) be in the prescribed form (if any); and be accompanied by the prescribed fee (if any); and name the entities sought to be added as associated en- tities.

Sections 67(3) to (5) and 67A apply with any necessary modi- fications.

The QFE may withdraw the application at any time before it is determined.
If the Commission approves an entity as an associated entity under this section, the Commission— (a) must notify the Registrar in writing of the name of the entity; and (b) may publicly notify the inclusion of the associated en- tity in the QFE group as it thinks fit.

Section 71: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Termination of status of associated entity The status of an associated entity terminates when— (a) (b) the entity ceases to be registered; or the Commission receives a written request from the en- tity or from the relevant QFE or any partner entity to cancel its status as associated entity; or (c) the QFE status of the relevant QFE is terminated.

Section 72: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
69 Part 3 s 73 Financial Advisers Act 2008 Reprinted as at 7 July 2010 73 (1) Certification of QFE group The Commission may issue a certificate stating that named entities are, as at the date of the certificate, a QFE group or that named entities were, during a specified period, a QFE group.

(2) A certificate issued under subsection (1) is, in the absence of proof to the contrary, evidence of its contents.
Section 73: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Nominated representatives of QFEs or partner entities 74 (1) A QFE or a partner entity may nominate an individual as one (b) of its nominated representatives by— (a) complying with the method (if any) prescribed for that purpose in the terms and conditions of the relevant grant of QFE status; or if those terms and conditions do not prescribe a method for that purpose, recording the nomination in a written instrument that— (i) nominates the individual as a nominated repre- sentative of the QFE or of the partner entity; and is dated and, if the nomination is to take effect on a later date, specifies that later date.
(ii) (3) (2) An individual may not be the nominated representative of 2 or more entities unless the entities are related bodies corporate.

The nomination of an individual as nominated representative is terminated if the entity that nominated the individual— (a) gives written notice to the individual and to the Com- mission to that effect; or as a result of the termination of QFE status, ceases to be a QFE or part of a QFE.

(b) (4) Every QFE must keep an up-to-date record of its nominated representatives.
Section 74: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Liability of employee or agent [Repealed] Heading: repealed, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
70 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 75 75 Variation of terms and conditions and period of grant of QFE status (1) A QFE may apply to the Commission for a variation of the (2) (3) terms and conditions of the grant of QFE status.

The Commission may grant or decline the application.
The Commission may, by notice to a QFE, propose a variation of the terms and conditions of the QFE’s grant of QFE status or the period of the grant on either or both of the following grounds: (a) the business of the QFE or of the QFE group has changed in a way that poses a material risk to con- sumers: the QFE or any member of the QFE group has been in- volved in market practices that are, in material respects, inconsistent with the purpose of this Act.
(b) (4) The Commission must specify in the notice a reasonable period for the QFE to respond in writing.

(6) (5) After considering any response received within the period spe- cified in the notice, the Commission may, by notice to the QFE, vary the terms and conditions of the QFE’s grant of QFE status or the period of the grant, or both.
The Commission may, in the notice under subsection (5), vary terms and conditions on a provisional basis and, if it does so, the Commission must, in the light of any changes in risk posed by the business or market practices of the QFE or any member of the QFE group, review those terms and conditions by a date stated in the notice.
(7) On completing the review, the Commission may do any of the following: (a) (b) (c) confirm 1 or more of the variations effected by subsec- tion (5): cancel 1 or more of the variations effected by subsection (5): propose new terms and conditions or a new period of grant by giving the QFE a further notice under subsec- tion (3).

Section 75: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
71 Part 3 s 75A Financial Advisers Act 2008 Reprinted as at 7 July 2010 75A Termination of QFE status (1) The QFE status of an entity or of partner entities terminates when— (a) the period of a grant of QFE status expires and the QFE fails for 60 clear days after that expiry to apply for re- newal of QFE status; or the Commission receives a written request from the QFE or from any partner entity requesting the Commis- sion to cancel the QFE status; or the entity that forms, or any of the partner entities that jointly form, the QFE ceases to be registered; or the Commission cancels its QFE status under section 75D(2).
(b) (c) (d) (2) The Commission must notify the Registrar in writing of the termination of QFE status under subsection (1)(a), (b), or (d).

Section 75A: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
75B Commission may designate certain QFE products as (1) beyond scope of QFE advisers If, because of the complexity of a particular category 1 prod- uct, the Commission has concerns about the provision of per- sonalised services in relation to that product by QFE advisers, the Commission may specify those concerns in a notice to the QFE or the partner entity whose QFE advisers provide those services.

(2) A notice under subsection (1) may be given only in exceptional (3) circumstances.
The Commission must specify in the notice a reasonable period for the relevant entity to respond in writing and must ask the entity to satisfy the Commission that the QFE advisers are able to, and will, provide financial adviser services in rela- tion to the category 1 product concerned with the appropriate level of professionalism and competence.
(4) After considering the entity’s response, the Commission may, by notice to the entity, determine that the QFE advisers may not provide personalised services to retail clients in relation to the specified category 1 product.

72 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 75D (5) A determination under subsection (4) has effect according to (6) its tenor despite anything in section 18.
The Commission may at any time, by notice to the entity, re- voke a determination under subsection (4).

Section 75B: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(3) (4) accompanied by the prescribed fee (if any).

75C Renewal of QFE status (1) A QFE may apply for renewal of QFE status.
(2) An application for renewal of QFE status must be— (a) made in the prescribed form (if any); and (b) Sections 64 to 70 apply, with any necessary modifications, to an application for renewal of QFE status.

If an application for renewal of QFE status has been made but not determined before the close of the 60th day after the date on which the period for which QFE status has been granted expires, the QFE status continues until the application is de- termined.
The renewal of QFE status takes effect from the date of expiry of the previous grant of QFE status.

Section 75C: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(5) Commission’s powers in relation to default by QFE or by members of QFE group inserted, on 1 July 2010, by section 23 of the Financial Advisers Heading: Amendment Act 2010 (2010 No 40).
75D Commission’s powers in relation to QFE default (1) This section applies if the Commission is satisfied that— (a) a QFE or any partner entity of a QFE has ceased to be eligible for QFE status; or the QFE or any member of the QFE group has breached or is in breach of this Act or the regulations; or the QFE or any member of the QFE group is in breach of a term or condition of the grant of QFE status; or (b) (c) 73 Part 3 s 75D Financial Advisers Act 2008 Reprinted as at 7 July 2010 (d) (e) the QFE or any partner entity of the QFE has failed to comply with a direction given to it by the Commission under section 75F; or the QFE or any partner entity of the QFE has failed to pay a fee or levy as required by this Act or the regula- tions.
(2) (3) (c) (d) In any case to which this section applies, the Commission may, after following the procedure set out in section 75E and subject to subsections (3) and (4),— (a) (b) cancel the QFE’s status; or cancel the QFE’s status and debar, for a specified period, the entity, any partner entity, and any associated entity of the former QFE from re-applying for QFE status; or suspend the QFE’s status for a specified period or until the suspended QFE or any partner entity, or any asso- ciated entity of the suspended QFE, does any thing that the Commission requires; or amend the terms and conditions of the QFE’s grant of status; or order that the QFE pay a fine not exceeding $50,000; or censure the QFE; or take no further action.
(e) (f) (g) The Commission may take only 1 of the actions specified in subsection (2), except that it may order the QFE to pay a fine not exceeding $50,000 in addition to taking an action under subsection (2)(d) or (f).

(5) (4) All partner entities of a QFE are jointly and severally liable for the payment of a fine that the QFE is ordered to pay under subsection (2)(e).
The Commission must not order the QFE to pay a fine in rela- tion to an act or omission that constitutes an offence for which the QFE or any partner entity of the QFE has been convicted by a court.

If the Commission cancels or suspends the QFE status of an entity, the Commission must notify the Registrar in writing of the cancellation or suspension, and, in the case of suspension, the period of suspension.
(6) 74 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 75F (7) The Commission may publicly notify the action it takes under subsection (2) as it sees fit.

Section 75D: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
75E Reasonable opportunity to be heard The Commission must not take any of the actions specified in section 75D(2) unless it has first— (a) informed the QFE and any partner entities of the QFE in writing of the reasons for taking any of those actions; and given the QFE and any partner entities of the QFE or their representatives a reasonable opportunity to make written submissions and be heard on the question.
Section 75E: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(b) 75F Commission may give QFE direction (1) (2) (3) (4) This section applies if the Commission has reason to believe that a QFE is in breach of a disclosure or conduct obligation or any obligation under section 76 or 77 (the obligation).
The Commission may give the QFE, and every partner entity of the QFE, notice of its alleged breach and, if the Commission does give a notice of breach, the Commission must also give the QFE a reasonable opportunity to respond.

If the Commission concludes, after considering the QFE’s re- sponse, that the QFE is in breach, the Commission may give the QFE a direction in writing.
The direction may— (a) (b) direct the QFE or any partner entity, or both, to comply with the obligation: stipulate any steps that the QFE or any partner entity, or both, must take in order to comply with the obligation: require the QFE to report to the Commission within 28 days of the date of the direction stating how and by when the Commission’s direction will be implemented.

(5) A QFE or a partner entity that fails to comply with a direction (c) by the Commission commits an offence (see section 132).
75 Part 3 s 75G Financial Advisers Act 2008 Reprinted as at 7 July 2010 (6) Nothing in this section precludes the Commission from exer- cising any of its other powers under this Act against a QFE.

Section 75F: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).

75G Other provisions concerning Commission’s powers in relation to QFE default (1) A fine imposed by the Commission under section 75D(2)(e) is recoverable in any court as a debt due to the Commission.
(3) (2) At the end of a period of suspension of QFE status, a QFE’s status is immediately revived, unless its QFE status has been further suspended or has been cancelled.

Suspension or cancellation is effective when a written notice of the suspension or cancellation is sent to the QFE by the Commission.

Section 75G: inserted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
QFE’s obligations Ongoing obligations of QFEs and of partner entities 76 (1) A QFE, and every partner entity of a QFE, must— (a) ensure compliance by the QFE and, where the QFE is part of a QFE group, by every member of that group, and by each employee and nominated representative of the QFE and of every member of that group, with the terms and conditions of the grant of QFE status; and (c) (b) where an associated entity is the associated entity not only of the QFE but also of another QFE, ensure com- pliance by the associated entity and by each employee of the associated entity with the terms and conditions of the grant of QFE status of that other QFE; and in relation to QFE advisers who are employees of the QFE or of a member of the QFE group, ensure compli- ance by each of those persons with his or her financial adviser obligations; and in relation to QFE advisers who are nominated repre- sentatives of the QFE or of a partner entity, ensure com- pliance by each of those persons with his or her financial adviser obligations, whether or not the nominated rep- (d) 76 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3 s 77 (e) (f) resentative acts for the QFE or for the partner entity or for any related body corporate of the QFE or the partner entity; and in relation to advisers of the QFE or of a member of the QFE group who perform a financial adviser service that, by virtue of sections 17 and 18 only an authorised financial adviser is permitted to perform, ensure that each of those persons is
 authorised; and provide the Commission, whenever reasonably required by the Commission and in any case in accordance with any requirements specified in the terms and conditions of its grant of QFE status, with an up-to-date list of the names of— (i) the authorised financial advisers of the QFE and of any members of the QFE group; and the nominated representatives of the QFE and of any partner entity; and (ii) (g) (h) (i) provide an annual report to the Commission in accord- ance with section 77; and comply with a direction by the Commission given under section 75F; and comply with its other obligations under this Act and the regulations.
(2) A contravention of subsection (1)(e) gives rise to the offences described in section 133.

Section 76: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
QFE must provide annual report to Commission 77 (1) Within 5 months after the end of its financial year, a QFE must send to the Commission a written report in respect of that year (the reporting year)— (a) certifying that the QFE and every member of the QFE group has complied with its obligations under this Act and the regulations, and with the terms and conditions of the grant of QFE status; and if the QFE or any member of the QFE group has not complied with its obligations under this Act and the regulations, and with the terms and conditions of the (b) 77 Part 3A s 77A Financial Advisers Act 2008 Reprinted as at 7 July 2010 (c) (d) (e) grant of QFE status, stating those respects in which it has failed to comply; and if the QFE is aware of any breach of a financial adviser obligation by an employee, agent, or nominated repre- sentative of the QFE or of a member of the QFE group, stating— (i) (ii) the name of that person; and the nature of that person’s breach or breaches; and containing any other information required by the regu- lations; and containing the information (if any) that is required to be contained in the report by the terms and conditions of the grant of QFE status.
(2) (3) (4) The report may be submitted by any partner entity of the QFE.

The report must be signed by either— a principal officer of the QFE; or (a) (b) a principal officer of a partner entity of the QFE.

Contraventions of subsection (1) give rise to the offences de- scribed in section 134.

Section 77: substituted, on 1 July 2010, by section 23 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Part 3A Brokers’ disclosure and conduct obligations Part 3A: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Who is broker and what is broking service Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 24 of the Financial Advisers 77A Who is broker (1) A broker is an individual or an entity who carries on a business of providing or offering to provide a broking service to a client (whether or not the business is the provider’s only business or the provider’s principal business).
78 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3A s 77C (2) See section 77U for how the Act’s requirements apply in the case of a person who provides a broking service on behalf of another person’s business.

Section 77A: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
77B What is broking service (1) A broking service is the receipt, holding, payment, or transfer of client money or client property by a person acting as an intermediary for a client.

(2) A person acts as an intermediary if the person does not receive, hold, pay, or transfer the money or property on the person’s own account.

The mere transmission of a non-transferable instrument payable to another person is not a broking service.
Section 77B: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(3) 77C Other exemptions (1) None of the following is a broking service for the purposes of this Act: (a) (b) a lawyer, incorporated law firm, conveyancing practi- tioner, chartered accountant, tax agent, real estate agent, registered legal executive, or other exempted class of service provider (as specified in the regulations) provid- ing a relevant service in the ordinary course of business of that kind: a statutory officer, a Crown organisation (other than Public Trust), or the Reserve Bank of New Zealand— discharging any duties or exercising any powers (i) of the statutory officer, the Crown organisation, or the Reserve Bank of New Zealand under any enactment; or doing anything that is incidental to the discharge of the functions of the statutory officer, the Crown organisation, or the Reserve Bank of New Zealand under any enactment: (ii) (c) an operator of a designated settlement system under sec- tion 156N of the Reserve Bank of New Zealand Act 79 Part 3A s 77D Financial Advisers Act 2008 Reprinted as at 7 July 2010 1989 providing a relevant service by the receipt, hold- ing, payment, or transfer of money or property in ac- cordance with the rules of that settlement system: a person providing a relevant service in the course of carrying on the business of dealing in futures contracts within the scope of an authorisation under section 38(1)(a) of the Securities Markets Act 1988 or an approval under section 38(1)(b) of that Act: an employer providing a relevant service to an em- ployee in connection with a financial product made available through the person’s workplace: any other person providing a relevant service in circum- stances exempted under the regulations.
(d) (e) (f) (2) (3) If subsection (1) applies to a person (A), it applies equally to any controlling owner, director, employee, agent, or other person acting in the course of, and for the purposes of, A’s business to the same extent as it applies to A.

In this section, relevant service means a service that, but for subsection (1), would be a broking service.

Section 77C: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Disclosure obligations for services for retail clients Heading: Amendment Act 2010 (2010 No 40).

inserted, on 1 July 2010, by section 24 of the Financial Advisers 77D What is disclosure obligation and when does it apply (1) A disclosure obligation under this Part is an obligation to make disclosure under or in accordance with sections 77E to 77I.

(2) A disclosure obligation applies only to a broking service pro- vided for a retail client.
Contravention of a disclosure obligation may give rise to an offence (see section 117).

Section 77D: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(3) 80 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3A s 77G 77E Broker must make disclosure before receiving client money or client property from retail client A broker must disclose prescribed information to a retail client, in accordance with this Act and the regulations,— (a) before receiving client money or client property from or on behalf of the client; or if not practicable before, as soon as practicable after receiving client money or client property from or on behalf of the client.
(b) Section 77E: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
77F What broker must disclose and form of disclosure (1) contact details: fees: Regulations for the purposes of prescribing disclosure for bro- kers under section 77E may require disclosure in relation to any or all of the following matters: (a) (b) (c) material interests, relationships, or associations: (d) (e) (f) remuneration: dispute resolution arrangements: in relation to the broker and, if the broker is an entity, each principal officer,— (i) (ii) (iii) (iv) procedures for handling client money or client property: indemnity insurance.
criminal convictions: disciplinary proceedings: adverse findings by a court or the Commission: bankruptcy or other insolvency proceedings: (g) (h) Regulations for the purposes of this section may provide for the form that the disclosure must take.

Section 77F: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 77G Disclosure must not be misleading, deceptive, or confusing Disclosure under a disclosure obligation must not be mislead- ing, deceptive, or confusing at the time that the disclosure is made.

Section 77G: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
81 Part 3A s 77H Financial Advisers Act 2008 Reprinted as at 7 July 2010 77H Disclosure of additional information (1) Disclosure of the matters that must be disclosed under a dis- closure obligation may be accompanied by disclosure of addi- tional information.

(2) Additional disclosure that accompanies disclosure under a dis- closure obligation must not be misleading, deceptive, or con- fusing at the time it is made.
Section 77H: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

77I No compliance with disclosure obligation if disclosure out (1) (2) of date Previous disclosure does not discharge a broker from a disclos- ure obligation if the previous disclosure is out of date when the client money or client property is received by the broker.
The previous disclosure is out of date if,— (a) since the date of the disclosure, there has been a material change in any matter that must be disclosed; and a reasonable person in the position of the client would consider that the change would materially affect any of the following decisions by the client: (i) to proceed with the broking service by the broker in question (B): to postpone or countermand the performance of a broking service by B.
(ii) (b) Section 77I: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Brokers’ conduct obligations Heading: Amendment Act 2010 (2010 No 40).

inserted, on 1 July 2010, by section 24 of the Financial Advisers 77J What is conduct obligation and when does it apply (1) A conduct obligation under this Part is an obligation under sections 77K to 77T.

The conduct obligations in sections 77K to 77O apply to all broking services.
The conduct obligations in sections 77P to 77T— (2) (3) 82 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3A s 77M (a) (b) apply only to broking services provided for a retail client; and do not apply to a broker within the meaning of the Insur- ance Intermediaries Act 1994 in relation to any money to which section 14 or 15 of that Act applies.

Section 77J: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 77K Broker must exercise care, diligence, and skill (1) A broker must, when providing a broking service, exercise the care, diligence, and skill that a reasonable broker would exercise in the same circumstances.
In determining the degree of care, diligence, and skill that a reasonable broker would exercise, the following matters must be taken into account (without limitation): (a) (b) the nature and requirements of the broker’s client; and the nature of the service provided and the circumstances in which the service is provided.

Section 77K: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
77L Broker must not engage in misleading or deceptive conduct (1) A broker must not engage in conduct in relation to the pro- vision of a broking service that is misleading or deceptive or likely to mislead or deceive.

Contravention of this section may give rise to an offence (see section 118).

Section 77L: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 77M Advertisement of broking services must not be misleading, deceptive, or confusing (1) A broker must not advertise a broking service in a way that is (2) misleading, deceptive, or confusing.

Contravention of this section may give rise to an offence (see section 119).

Section 77M: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
83 Part 3A s 77N Financial Advisers Act 2008 Reprinted as at 7 July 2010 77N Restriction on use of term sharebroker (1) In any advertising or promotional material, the term sharebro- ker must not be used in connection with a person unless the person, or the person’s employer, is a member of a registered exchange.

Contravention of this section may give rise to an offence (see section 120).

Section 77N: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 77O Broker must not receive client money if offer for subscription illegal (1) A broker (A) must not receive client money or client property (b) (c) from a person for the acquisition of securities if— (a) when the securities were or are offered for subscription, the offer was or is illegal; and the illegality has not been remedied; and A knows or ought to know that, when the securities were or are offered for subscription, the offer was or is illegal.
Contravention of this section may give rise to an offence (see section 134B).

Section 77O: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(2) Trust accounting obligations for services for retail clients Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 24 of the Financial Advisers 77P Broker must pay client money into separate trust account (1) A broker who receives client money or client property, in his, her, or its capacity as a broker for a retail client,— (a) must hold the client money or client property, or ensure the client money or client property is held, on trust for the client; and (b) must ensure that the client money is paid promptly into a bank in New Zealand (or into any other prescribed entity) to a trust account of the broker or of a related person or entity specified in the regulations.
84 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3A s 77R (2) Contravention of this section may give rise to an offence (see section 134C).

Section 77P: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
77Q Broker must account for client money and client property (1) A broker who receives or holds client money and client prop- erty on trust for a retail client must account properly, or en- sure that account is properly made, to the client for that client money or client property.

Contravention of this section may give rise to an offence (see section 134D).

Section 77Q: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 77R Broker must keep records of client money and client property (1) A broker who receives or holds client money on trust for a re- tail client must keep, or ensure that there are kept, trust account records that disclose clearly the position of the client money in the trust account.
(2) A broker who receives or holds client property on trust for a retail client must keep, or ensure that there are kept, records that— (a) (b) identify the client property; and show the date when the client property was received; and if the client property has been disposed of, show where the client property was disposed of and to whom.
(c) (3) A broker must keep the records required by this section, or en- sure that they are kept, in a manner that enables those records to be conveniently and properly audited or inspected.

Contravention of any of subsections (1) to (3) may give rise to an offence (see section 134E).

Section 77R: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(4) 85 Part 3A s 77S Financial Advisers Act 2008 Reprinted as at 7 July 2010 77S Restrictions on use of client money and client property (1) A person must not use or apply client money or client property received or held on trust for a retail client by a broker in any way except— (a) as expressly directed by the client (either generally or specifically); or in accordance with section 77P (which relates to pay- ment of client money into a trust account).
(b) (2) Contravention of this section may give rise to an offence (see section 134F).

Section 77S: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).
77T Protection of client money and client property held on (1) trust The client money or client property that is received or held by a broker on trust for a retail client— (a) is not available for the payment of the debts of any other creditor of the broker; and is not liable to be attached or taken in execution under the order or process of any court at the instance of an- other creditor of the broker.
(b) (2) Nothing in section 77S or this section takes away or affects any lawful lien or claim that a broker who holds client money or client property has against the client money or client property.

Section 77T: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Persons acting in course of business of employers or principals Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 24 of the Financial Advisers 77U Who is responsible for broker obligations (1) If a broking service is provided by a person (A) on behalf of the business of another person (B), B (and not A) is treated as the broker having the broker obligations under this Act.
If B has a broker obligation under subsection (1)— (2) 86 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 3A s 77V (a) (b) any act or omission by A is also treated as being done by B; and if it is necessary to show the state of mind of B, it is sufficient to show that A had that state of mind.

Subsections (1) and (2) do not affect the liability of A or B under any other Act or rule of law for A’s actions.
Section 77U: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(3) Commission’s direction in respect of breach of disclosure or conduct obligation Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 24 of the Financial Advisers 77V Commission may give broker direction in respect of (1) (2) (3) (4) breach of disclosure or conduct obligation This section applies if the Commission has reason to believe that a broker is in breach of a disclosure or conduct obligation under this Part.
The Commission may give the broker notice of his, her, or its alleged breach and, if the Commission does give a notice of breach, the Commission must also give the broker a reasonable opportunity to respond.

If the Commission concludes, after considering the broker’s response, that the broker is in breach, the Commission may give the broker a direction in writing.
The direction may— (a) (b) direct the broker to comply with the disclosure or con- duct obligation: stipulate any steps that the broker must take in order to comply with the obligation: require the broker to report to the Commission within 28 days of the date of the direction stating how and when the Commission’s direction will be implemented.

(5) A broker who fails to comply with a direction by the Commis- (c) sion commits an offence (see section 134G).
(6) Nothing in this section precludes the Commission from exer- cising any of its other powers under this Act against a broker.

87 Part 4 s 78 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Section 77V: inserted, on 1 July 2010, by section 24 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Part 4 How financial advisers and brokers are regulated Part 4 heading: amended, on 1 July 2010, by section 25 of the Financial Advis- ers Amendment Act 2010 (2010 No 40).
Outline of this Part This Part is divided into 3 subparts.

Subpart 1 deals with— (a) (b) the appointment and role of the Commissioner for Fi- nancial Advisers; and the establishment of a code of professional conduct for authorised financial advisers; and the establishment and functions of a code committee.

(c) Subpart 2 deals with— (a) the procedure for dealing with complaints in relation to an authorised financial adviser; and the establishment of a disciplinary committee.
(b) Subpart 3 deals with offences under this Act.

Subpart 1—Commissioner for Financial Advisers, code of professional conduct, and code committee Commissioner for Financial Advisers Commissioner for Financial Advisers There must be a Commissioner for Financial Advisers (the Commissioner).

The Commissioner is a member of the Commission as pro- vided in section 11(3C) of the Securities Act 1978.

The Commissioner must be appointed by the Governor-Gen- eral on the recommendation of the Minister.
The Minister must not recommend a person for appointment as Commissioner unless, in the Minister’s opinion, that person is qualified for appointment, having regard to the functions and 78 (1) (2) (3) (4) 79 (1) (2) (3) (4) 88 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 82 (5) (6) 80 81 82 duties of the Commission, whether under this Act or any other enactment.
For the purposes of subsection (4), a person is qualified for ap- pointment by virtue of that person’s knowledge of, or experi- ence in, the financial adviser industry or any other industry, commerce, economics, law, accountancy, public administra- tion, or securities.
This section must be read subject to the following: (a) subsection (3) applies despite section 28(1)(b) of the Crown Entities Act 2004; and subsection (4) applies despite section 11(4) of the Se- curities Act 1978; and subsections (4) and (5) do not limit section 29 of the Crown Entities Act 2004.
(b) (c) Compare: 2001 No 103 s 9 Functions of Commissioner The functions of the Commissioner are as follows: to appoint members of the code committee: (a) to review the code and propose changes to the code as (b) required: to act as chairperson of the disciplinary committee: to exercise and perform such other functions, powers, and duties as are conferred or imposed on the Commis- sioner by or under this Act or any other enactment.
(c) (d) Code committee Commissioner must establish code committee The Commissioner must establish a code committee.

Functions of code committee The functions of the code committee are— (a) first, to produce a draft code for approval by the Com- missioner; and subsequently, to review the code from time to time; and to recommend to the Commissioner changes to the code as the code committee thinks fit.
(b) (c) 89 Part 4 s 83 Financial Advisers Act 2008 Reprinted as at 7 July 2010 83 Membership of code committee (1) (2) (3) (4) appoint a member of the code committee; or discharge a member of the code committee.

The Commissioner may at any time— (a) (b) The appointment of a member of the code committee must be for a specified period, but a member may be discharged under subsection (1)(b) before his or her period of appointment has expired.
The code committee must have not less than 7 members and not more than 11 members, and the Commissioner must ensure that the number of current members does not fall below 7.
The Commissioner must appoint as members of the code com- mittee— (a) 1 person who, in the Commissioner’s opinion, is quali- fied for appointment by virtue of his or her knowledge of, and experience and competency in relation to, con- sumer affairs; and other persons who, in the Commissioner’s opinion, are each qualified for appointment by virtue of their indi- vidual knowledge of, and experience and competency in relation to, the financial adviser industry.
(5) A member of the code committee may resign by notice in writ- (b) ing to the Commissioner.

(2) Proceedings of code committee 84 (1) Meetings of the code committee must be held at the times and places as the code committee or the chairperson from time to time decides.

The code committee must elect 1 of its members as chairper- son.

The quorum for a meeting of the code committee is 5 members.
Every question before the code committee must be determined by a majority of the votes of the members present or otherwise.

The chairperson of the code committee has a deliberative vote and, in the case of an equality of votes, a casting vote.

(3) (4) (5) 90 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 86 (6) 85 86 (1) (2) (3) (4) Except as provided in this section and in any regulations made under this Act, the code committee may regulate its own pro- cedure.
Compare: 2006 No 60 s 56 Certain provisions of Crown Entities Act 2004 apply to members of code committee Clause 15 of Schedule 5 of the Crown Entities Act 2004 (Schedule 5) applies as if the code committee were a commit- tee appointed by the Commission under clause 14 of Schedule 5 and with all other necessary modifications.

Code of professional conduct for authorised financial advisers of competence; and of knowledge and skills; and of ethical behaviour; and of client care.
Content of code The code must provide for minimum standards of professional conduct that must be demonstrated by authorised financial ad- visers, including minimum standards— (a) (b) (c) (d) The code must also provide for continuing professional train- ing for authorised financial advisers, including specification of minimum requirements that an authorised financial adviser must meet for the purpose of continuing professional training.
The code may specify different standards for different classes of authorised financial adviser.

The code may limit or modify standards, or provide for separ- ate standards, for the duration of 1 or more periods of transi- tion.

(5) Despite subsection (1), the code may provide for different min- imum standards for individuals training to be authorised finan- cial advisers.

Section 86(4): added, on 1 July 2010, by section 26 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Section 86(5): added, on 1 July 2010, by section 26 of the Financial Advisers Amendment Act 2010 (2010 No 40).

91 Part 4 s 87 Financial Advisers Act 2008 Reprinted as at 7 July 2010 87 (1) (2) Code committee must prepare code The code committee must prepare a draft code.
In preparing the draft code, the code committee must— (a) consult any persons that it reasonably considers to be representative of the financial adviser industry; and consult with interest groups within the financial adviser industry; and allow an opportunity for any person affected by the code to make submissions to the code committee.
(b) (c) Commissioner’s approval of draft code 88 (1) After receiving the draft code prepared by the code committee, (2) the Commissioner must— approve it; or (a) decline to approve it.

(b) The Commissioner must approve the draft code prepared by the code committee if the Commissioner is satisfied that— (a) a majority of the code committee has approved the draft code; and the code committee has complied with its obligations under section 87(2); and the draft code is consistent with this Act.
(3) A failure by the code committee to comply with its obligations (b) (c) under section 87(2) does not affect the validity of the code.

This section is subject to section 89.

Section 88(3): amended, on 28 July 2009, by section 9 of the Financial Advisers Amendment Act 2009 (2009 No 24).
Commissioner may require revision or consultation If the Commissioner is not satisfied as to a matter specified in section 88(2),— (a) the Commissioner must direct the code committee to revise the draft code or undertake further consultation or receive submissions, as necessary; and the code committee must as soon as practicable comply with the Commissioner’s direction.
(b) If the Commissioner considers that the draft code is not con- sistent with this Act, the Commissioner must, in directing the (4) 89 (1) (2) 92 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 92 code committee to revise the draft code, state in what respects he or she considers that the draft code is not consistent.
Commissioner’s approval of revised draft code 90 (1) After receiving a revised draft code, the Commissioner must— (ii) (a) (b) approve the revised draft code; or if the Commissioner considers that the draft code re- quires further amendment to be consistent with this Act,— (i) make any amendments to the draft code that the Commissioner considers necessary; and approve the draft code as amended.
Before making any amendment to the draft code under this section, the Commissioner must— (a) advise the code committee of the Commissioner’s in- tention to do so; and give the code committee a reasonable opportunity to make submissions on the matter; and consider those submissions.

(b) (c) Deadline for Commissioner’s approval of draft code The Commissioner must approve the draft code within 90 days of receiving the draft code or, if section 89 applies, within 90 days of receiving the revised draft code.
(2) 91 (2) 92 Minister’s approval required (1) After approving the draft code or after the 90-day deadline for approval specified in section 91 has expired, the Commis- sioner must forward the draft code to the Minister for the Min- ister’s approval.

The Minister must approve the draft code unless the Minister considers that it is not consistent with this Act.
If the Minister is not satisfied that the draft code is consistent with this Act, the Minister must implement the procedure set out in sections 89 and 90 with necessary modifications.

For the purposes of subsection (3), a reference in sections 89 and 90 to the Commissioner must be read as a reference to the Minister.
(4) (3) 93 Part 4 s 93 Financial Advisers Act 2008 Reprinted as at 7 July 2010 93 Deadline for Minister’s approval of draft code The Minister must approve the draft code within 90 days of receiving the draft code or, if section 92(3) applies, within 90 days of receiving the revised draft code.
(2) Code comes into force by Gazette notice 94 (1) After the Minister has approved the draft code or after the 90-day deadline for approval specified in section 93 has ex- pired, the Commissioner must give notice in the Gazette of the date or dates on which the provisions of the code come into force.

The notice may state different dates for different provisions, but no date may be before the 28th day after the date on which the notice is published in the Gazette.
Each provision in the code comes into force on the date stated in the notice that applies to the provision.

The code and the notice are each regulations for the purposes of the Regulations (Disallowance) Act 1989 and the Acts and Regulations Publication Act 1989.

Section 94: substituted, on 1 July 2010, by section 27 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(3) (4) Changes to code Changes to code 95 (1) A change to the code may be proposed by— the code committee; or the Commissioner; or the Minister.

(a) (b) (c) The procedure for changing the code is the same as the proced- ure set out in sections 87 to 94 for the preparation and approval of the draft code.
(2) 94 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 98 Subpart 2—Complaints and disciplinary proceedings Who deals with complaints Complaint about financial adviser 96 (1) Any person may complain to the Commission about the con- duct of another person in that second person’s capacity as a financial adviser.

The Commissioner may initiate a complaint.


(2) Investigation by Commission 97 (1) After receiving a complaint, the Commission must investigate (2) 98 (b) the complaint if it is practicable to do so having regard to— (a) the nature and number of complaints to be investigated; and the Commission’s regulatory priorities as reflected in its statement of intent; and the Commission’s available resources.
(c) The Commission need not investigate a complaint if it is sat- isfied that— (a) (b) the complaint is vexatious; or the complaint is not sufficiently serious to warrant in- vestigation.

Section 97(2): amended, on 28 July 2009, by section 10 of the Financial Ad- visers Amendment Act 2009 (2009 No 24).
Complaint about authorised financial adviser Reference of complaint to disciplinary committee When the Commission has, under section 97, investigated a complaint about an authorised financial adviser, it must refer the complaint to the disciplinary committee if, in the Commis- sion’s opinion, the conduct complained of amounts to a breach of the code.

Section 98: substituted, on 1 July 2010, by section 28 of the Financial Advisers Amendment Act 2010 (2010 No 40).
95 Part 4 s 99 Financial Advisers Act 2008 Reprinted as at 7 July 2010 99 Disciplinary committee must give notice of complaint to financial adviser concerned If the Commission refers a complaint about an authorised fi- nancial adviser to the disciplinary committee, and the discip- linary committee considers that a hearing is necessary to deal with the complaint, the disciplinary committee must serve a written notice of the complaint on the financial adviser.
100 Content of disciplinary committee’s notice of complaint The disciplinary committee’s notice of complaint to the finan- cial adviser concerned (A) must— (a) state that the disciplinary committee considers that there is reason to believe that A may have breached the code; and contain the particulars that are reasonably necessary to clearly inform A of the nature of the contravention; and specify a date, which must not be sooner than 20 work- ing days after the date of service of the notice, on which the disciplinary committee intends to hear the matter.
(b) (c) Section 100: amended, on 28 July 2009, by section 11 of the Financial Advisers Amendment Act 2009 (2009 No 24).

101 Disciplinary committee may discipline authorised financial adviser for breach of code In this section, A is the person who is the subject of the com- plaint.

The disciplinary committee may take any of the actions re- ferred to in subclause (3) if it is satisfied that A has breached the code.
In any case to which subsection (2) applies, the disciplinary committee may— (a) recommend that the Commission cancels A’s authorisa- tion: recommend that the Commission— cancels A’s authorisation; and (i) debars A for a specified period from applying to (ii) be re-authorised: recommend that the Commission suspends A’s author- isation for a period of no more than 12 months or until (b) (c) (1) (2) (3) 96 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 103 A meets specified conditions relating to the authorisa- tion (but, in any case, not for a period of more than 12 months): censure A: order that A may, for a period not exceeding 3 years, perform a financial adviser service only subject to any conditions as to employment, supervision, or otherwise that the disciplinary committee may specify in the order: order that A undertake training specified in the order: order that A must pay a fine not exceeding $10,000: take no action.
(d) (e) (f) (g) (h) (5) (4) No fine may be imposed under subsection (3)(g) in relation to an act or omission that constitutes an offence for which A has been convicted by a court.

In any case to which subsection (2) applies, the disciplinary committee may order that A must pay costs and expenses of, and incidental to, the investigation by the Commission and the disciplinary committee’s proceeding.

The disciplinary committee may publicly notify the action in any way that it thinks fit.
This section applies whether or not A is an authorised financial adviser at the time of the complaint, the investigation, or the disciplinary proceeding.
(7) (6) 102 Reasonable opportunity to be heard The disciplinary committee must not take any of the actions specified in section 101(3) unless it has first— (a) informed the person concerned in writing as to why it may take any of those actions; and given that person or his or her representative a reason- able opportunity to make written submissions and be heard on the question.
(b) Disciplinary committee 103 Minister must establish disciplinary committee The Minister must establish a disciplinary committee.
97 Part 4 s 104 Financial Advisers Act 2008 Reprinted as at 7 July 2010 104 Functions of disciplinary committee The functions of the disciplinary committee are to— (a) conduct disciplinary proceedings arising out of com- plaints regarding authorised financial advisers referred to it by the Commission; and take any of the actions referred to in section 101(3) as a result of disciplinary proceedings.
(b) 105 Membership of disciplinary committee (1) The Minister may at any time appoint a member of the discip- linary committee.

The appointment of a member of the disciplinary committee must be for a specified period.

The Minister must appoint the Commissioner as the chairper- son of the disciplinary committee.
The disciplinary committee must have between not less than 4 members and not more than 6 members including the chairper- son, and the Minister must ensure that the number of current members does not fall below 4.
(2) (3) (4) (5) Apart from the chairperson, the Minister must appoint as mem- bers of the disciplinary committee— (a) at least 1 member who works or has worked in the fi- nancial adviser industry; and at least 1 member who is independent of the financial adviser industry; and at least 1 member who is a lawyer with not less than 7 years’ legal experience.

(b) (c) (6) A member of the disciplinary committee may resign by notice in writing to the Minister.
106 Proceedings of disciplinary committee (1) Meetings of the disciplinary committee must be held at the times and places as the disciplinary committee or the chair- person from time to time decides.

The quorum for a meeting of the disciplinary committee is 3 members.

(2) 98 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 108 (3) (4) (5) Every question before the disciplinary committee must be de- termined by a majority of the votes of the members present at the meeting.
The chairperson of the disciplinary committee has a delibera- tive vote and, in the case of an equality of votes, a casting vote.

Except as provided for in this Act and in any regulations made under this Act, the disciplinary committee may regulate its own procedure.
Compare: 2006 No 60 s 56 107 Disciplinary committee may hear evidence in disciplinary (1) proceeding In a disciplinary proceeding the disciplinary committee may— receive evidence on oath (and for that purpose a member (a) of the disciplinary committee may administer an oath): permit a person appearing as a witness before it to give evidence by tendering a written statement and verifying that statement by oath, statutory declaration, or other- wise.
(b) (2) A hearing before the disciplinary committee in a disciplinary proceeding is a judicial proceeding for the purposes of sections 108 and 109 of the Crimes Act 1961.
Compare: 2005 No 38 s 30 108 District Court may authorise disciplinary committee to summon witnesses on disciplinary matters (1) A District Court Judge may, on the application of the discip- linary committee or the person to whom the proceedings re- late, give a certificate authorising the disciplinary committee to issue a summons under section 109.
(2) A District Court Judge must not give a certificate under sub- section (1) unless satisfied that— (a) the evidence of the witness is or may be material to the hearing of a disciplinary matter by the disciplinary committee; and it is necessary or desirable that the summons be issued to compel the attendance of the witness at the hearing.
(b) Compare: 2005 No 38 s 31 99 Part 4 s 109 Financial Advisers Act 2008 Reprinted as at 7 July 2010 109 (1) (2) (3) Issuing of summons by disciplinary committee The disciplinary committee must, on production of a certifi- cate referred to in section 108, issue a summons to a person requiring that person to attend a hearing before the disciplin- ary committee and to do all or any of the following: (a) (b) (c) give evidence: give evidence under oath: produce documents, things, or information, or any spe- cified documents, things, or information, in the posses- sion or control of that person, that are relevant to the hearing.
(b) (c) The summons must be in writing, be signed by the chairperson of the disciplinary committee, and state— (a) the date and time when, and the place where, the person must attend; and the documents, things, or information that the person is required to bring and produce to the disciplinary com- mittee; and the entitlement to be tendered or paid a sum in respect of witnesses’ fees, allowances, and expenses; and the penalty for failing to attend.
(d) The disciplinary committee may require that any documents, things, or information produced under this section be verified by oath, statutory declaration, or otherwise.

Compare: 2005 No 38 s 32 110 Serving of summons (1) A summons may be served— (a) (b) by delivering it personally to the person summoned; or by posting it to the person summoned at that person’s usual place of residence.
(2) A summons must,— (a) (b) if it is to be served under subsection (1)(a), be served at least 48 hours before the attendance of the witness is required: if it is to be served under subsection (1)(b), be served at least 10 days before the attendance of the witness is required.

100 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 113 (3) A summons that is posted is treated as having been served when it would have been delivered in the ordinary course of post.
Compare: 2005 No 38 s 33 111 Witnesses’ fees, allowances, and expenses (1) A witness appearing before the disciplinary committee under a summons is entitled to be paid witnesses’ fees, allowances, and expenses in accordance with the scales prescribed by regu- lations under the Summary Proceedings Act 1957.

The person requiring attendance of the witness must pay or tender to the witness the fees, allowances, and expenses at the time the summons is served or at some other reasonable time before the hearing.
Compare: 2005 No 38 s 34 (2) 112 Protection for witnesses and counsel in disciplinary (1) (2) proceeding Every person who does the following things has the same priv- ileges as witnesses have in a court: (a) provides documents, things, or information to the dis- ciplinary committee in relation to a disciplinary matter; or gives evidence or answers questions at a hearing of the disciplinary committee in relation to a disciplinary mat- ter.
(b) Every counsel appearing before the disciplinary committee in relation to a disciplinary matter has the same privileges and immunities as counsel in a court.

Compare: 2005 No 38 s 36 113 Certain provisions of Crown Entities Act 2004 apply to members of disciplinary committee Clause 15 of Schedule 5 of the Crown Entities Act 2004 (Schedule 5) applies as if the disciplinary committee were a committee appointed by the Commission under clause 14 of Schedule 5 and with all other necessary modifications.
101 Part 4 s 114 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Subpart 3—Offences Offences: Restrictions on providing services and holding out Heading: substituted, on 1 July 2010, by section 29 of the Financial Advisers Amendment Act 2010 (2010 No 40).
114 Offence of providing financial adviser service without being permitted to do so (b) (1) A person who provides a financial adviser service set out in section 18 when not permitted to do so under that section and section 17 commits an offence and is liable on summary con- viction,— (a) in the case of an individual, to a fine not exceeding $10,000: in the case of an entity, to a fine not exceeding $50,000.
(2) A person who provides a financial adviser service set out in section 19 or 20 when not permitted to do so under those sec- tions and section 17 commits an offence and is liable on sum- mary conviction,— (a) in the case of an individual, to a fine not exceeding $5,000: in the case of an entity, to a fine not exceeding $10,000.
(3) A person (A) has a defence to a charge under subsection (1) or (2) if A proves on the balance of probabilities that A did not know, and ought not reasonably to have known, that A did not come within the requirements of the relevant section or sections.

Section 114: substituted, on 1 July 2010, by section 29 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(b) 115 Offence of holding out as authorised financial adviser, financial planner, investment planner, or QFE A person who knowingly or recklessly contravenes section 20A, 20B, or 20C commits an offence and is liable on sum- mary conviction,— (a) in the case of an individual, to a fine not exceeding $10,000: in the case of an entity, to a fine not exceeding $50,000.
(b) 102 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 118 Section 115: substituted, on 1 July 2010, by section 29 of the Financial Advisers Amendment Act 2010 (2010 No 40).

116 Offences in relation to employer or principal failing to maintain registration (1) A person who contravenes section 18(2)(a) commits an of- fence and is liable on summary conviction to a fine not ex- ceeding $5,000.
(2) A person who contravenes section 18(2)(b) commits an of- fence and is liable on summary conviction to a fine not ex- ceeding $10,000.

Disclosure offences: Financial advisers, QFEs, and brokers Heading: amended, on 1 July 2010, by section 30 of the Financial Advisers Amendment Act 2010 (2010 No 40).
117 Failure to make disclosure under or in accordance with disclosure obligation A person who knowingly or recklessly contravenes a disclos- ure obligation commits an offence and is liable on summary conviction to a fine,— in the case of an individual, not exceeding $100,000: (a) (b) in the case of an entity, not exceeding $300,000.

Section 117(b): amended, on 1 July 2010, by section 31 of the Financial Advis- ers Amendment Act 2010 (2010 No 40).
Conduct offences: Financial advisers and brokers Heading: amended, on 1 July 2010, by section 32 of the Financial Advisers Amendment Act 2010 (2010 No 40).

118 Offence of misleading or deceptive conduct by financial adviser or broker A person who knowingly or recklessly contravenes sec- tion 34(1) or section 77L commits an offence and is liable on summary conviction to a fine,— (a) (b) in the case of an individual, not exceeding $100,000: in the case of an entity, not exceeding $300,000.
103 Part 4 s 119 Financial Advisers Act 2008 Reprinted as at 7 July 2010 Section 118: substituted, on 1 July 2010, by section 33 of the Financial Advisers Amendment Act 2010 (2010 No 40).
119 Offence of misleading, deceptive, or confusing advertisement by financial adviser or broker A person who knowingly or recklessly contravenes sec- tion 35(1) or section 77M commits an offence and is liable on summary conviction to a fine,— in the case of an individual, not exceeding $100,000: (a) (b) in the case of an entity, not exceeding $300,000.

Section 119: substituted, on 1 July 2010, by section 33 of the Financial Advisers Amendment Act 2010 (2010 No 40).
120 Offence of contravening restrictions on use of term sharebroker A person who knowingly or recklessly contravenes section 77N commits an offence and is liable on summary conviction to a fine,— (a) in the case of an individual, not exceeding $10,000: in the case of an entity, not exceeding $50,000.

(b) Section 120: substituted, on 1 July 2010, by section 33 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Offences: Authorised financial advisers only 121 Offence of recommending offer of securities when subscription illegal A person who contravenes section 38(1) commits an offence and is liable on summary conviction to a fine not exceeding $100,000.

Section 121 heading: amended, on 1 July 2010, by section 34 of the Financial Advisers Amendment Act 2010 (2010 No 40).
122 Offence of contravening requirement that authorised financial adviser pay client’s money into separate trust account [Repealed] Section 122: repealed, on 1 July 2010, by section 35 of the Financial Advisers Amendment Act 2010 (2010 No 40).

104 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 128 123 Offence of failing to account for client’s money or other property [Repealed] Section 123: repealed, on 1 July 2010, by section 35 of the Financial Advisers Amendment Act 2010 (2010 No 40).
124 Offence in relation to records of client’s money or property [Repealed] Section 124: repealed, on 1 July 2010, by section 35 of the Financial Advisers Amendment Act 2010 (2010 No 40).

125 Offence of breaching restrictions on use of client’s money or property [Repealed] Section 125: repealed, on 1 July 2010, by section 35 of the Financial Advisers Amendment Act 2010 (2010 No 40).
126 Offence of failing to comply with terms and conditions of authorisation A person who contravenes section 45(1) commits an offence and is liable on summary conviction to a fine not exceeding $5,000.

127 Offence of failing to comply with Commission’s direction A person who fails to comply with a direction of the Com- mission given under section 61(3) commits an offence and is liable on summary conviction to a fine not exceeding $5,000.
128 Offence of contravening condition of disciplinary committee’s order A person who contravenes a condition of an order made by the disciplinary committee under section 101(3)(e) commits an offence and is liable on summary conviction to a fine not exceeding $5,000.

Offences: QFEs and QFE groups only Heading: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).
105 Part 4 s 129 Financial Advisers Act 2008 Reprinted as at 7 July 2010 129 Offence of failing to comply with terms and conditions of (1) (2) the QFE: every partner entity of the QFE.
QFE status If a QFE contravenes section 46(1), each of the following per- sons commits an offence and is liable on summary conviction to a fine not exceeding $25,000: (a) (b) If a partner entity of a QFE contravenes section 46(1), every partner entity of the QFE commits an offence and is liable on summary conviction to a fine not exceeding $25,000.

Section 129: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(1) the QFE: every partner entity of the QFE.
130 Offence of misleading or deceptive conduct in relation to financial adviser service by employee, agent, or nominated representative If a QFE knowingly or recklessly contravenes section 47(1), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $300,000: (a) (b) If an associated entity of a QFE knowingly or recklessly contravenes section 47(1), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $300,000: (a) (b) (c) Section 130: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).
the associated entity of the QFE: the QFE: every partner entity of the QFE.

(2) 131 Offence of misleading, etc, advertisement of financial adviser service by employee, agent, or nominated representative If a QFE knowingly or recklessly contravenes section 48(1), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $300,000: (a) (b) the QFE: every partner entity of the QFE.
(1) 106 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 134 (2) If an associated entity of a QFE knowingly or recklessly contravenes section 48(1), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $300,000: (a) (b) (c) Section 131: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).

the associated entity of the QFE: the QFE: every partner entity of the QFE.
132 Offence of failing to comply with Commission’s direction If a QFE fails to comply with a direction of the Commis- sion given under section 75F(3), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $25,000: (a) (b) Section 132: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).

the QFE: every partner entity of the QFE.


133 Offence of failing to comply with obligations in relation to authorised financial advisers If a QFE or a partner entity contravenes section 76(1)(e), each of the following persons commits an offence and is liable on summary conviction to a fine not exceeding $50,000: (a) (b) Section 133: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).

the QFE: every partner entity of the QFE.


134 Offence of failing to provide annual report If a QFE contravenes section 77(1), each of the following per- sons commits an offence and is liable on summary conviction to a fine not exceeding $25,000: (a) (b) Section 134: substituted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).

the QFE: every partner entity of the QFE.
107 Part 4 s 134A Financial Advisers Act 2008 Reprinted as at 7 July 2010 134A Defence to offences relating to entities in QFE groups An entity, being the QFE of a QFE group or a partner entity, has a defence to an offence under any of sections 129 to 134 if the entity proves that the entity— (a) was not involved in the contravention that constitutes the offence; and took all reasonable steps to ensure that the members of the QFE group complied with the requirements of this Act.
(b) Section 134A: inserted, on 1 July 2010, by section 36 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Offences: Broking services only Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 37 of the Financial Advisers 134B Offence of receiving client money if offer for subscription illegal A person who contravenes section 77O commits an offence and is liable on summary conviction to a fine,— in the case of an individual, not exceeding $100,000: (a) (b) in the case of an entity, not exceeding $300,000.

Section 134B: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
134C Offence of contravening requirement to pay client money into separate trust account A person who contravenes section 77P commits an offence and is liable on summary conviction to a fine,— (a) in the case of an individual, not exceeding $5,000: in the case of an entity, not exceeding $25,000.

(b) Section 134C: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
134D Offence of failing to account for client money and client property A person who contravenes section 77Q commits an offence and is liable on summary conviction to a fine,— (a) in the case of an individual, not exceeding $5,000: 108 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 134G in the case of an entity, not exceeding $25,000.

(b) Section 134D: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
134E Offence in relation to records of client money and client property A person who contravenes any of section 77R(1) to (3) commits an offence and is liable on summary conviction to a fine,— in the case of an individual, not exceeding $5,000: (a) (b) in the case of an entity, not exceeding $25,000.

Section 134E: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
134F Offence of breaching restrictions on use of client money and client property A person who contravenes section 77S commits an offence and is liable on summary conviction to a fine,— (a) in the case of an individual, not exceeding $5,000: in the case of an entity, not exceeding $25,000.

(b) Section 134F: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
134G Offence of failing to comply with Commission’s direction A person who fails to comply with a direction of the Commis- sion given under section 77V commits an offence and is liable on summary conviction to a fine,— in the case of an individual, not exceeding $5,000: (a) (b) in the case of an entity, not exceeding $25,000.

Section 134G: inserted, on 1 July 2010, by section 37 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Miscellaneous offences Heading: inserted, on 1 July 2010, by section 38(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

109 Part 4 s 135 Financial Advisers Act 2008 Reprinted as at 7 July 2010 135 Offence of failing to comply with Commission’s direction in respect of breach of disclosure or conduct obligation A person who fails to comply with a direction of the Com- mission given under section 49(3) commits an offence and is liable on summary conviction to a fine not exceeding $5,000.
Miscellaneous offences [Repealed] Heading: repealed, on 1 July 2010, by section 38(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).
136 Offence of false declaration, etc, in support of application for authorisation or grant of QFE status (1) A person (A) commits an offence if A has, for the purpose of obtaining authorisation or the grant of QFE status, either for A or for any other person,— (a) either orally or in writing, made any declaration or rep- resentation knowing it to be false or misleading in a ma- terial particular; or produced to the Commission or made use of any docu- ment knowing it to contain a declaration or representa- tion referred to in paragraph (a); or produced to the Commission or made use of any docu- ment knowing that it was not genuine.
(b) (c) (2) A person who commits an offence under this section is liable on summary conviction to a fine,— (a) (b) in the case of an individual, not exceeding $100,000: in the case of an entity, not exceeding $300,000.
137 Failure to comply with summons by Commissioner to attend disciplinary committee hearing (1) A person summoned under section 109 commits an offence if he or she, without sufficient cause,— (a) (b) (c) fails to attend in accordance with the summons; or does not give evidence when required to do so; or does not give evidence under oath when required to do so; or does not answer any question that is lawfully asked by the disciplinary committee; or (d) 110 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137A (e) does not provide any documents, things, or information that the summons requires the person to provide.
(2) A person who commits an offence under this section is liable on summary conviction to a fine not exceeding $5,000.

(3) A person must not be convicted of an offence under this sec- tion if witnesses’ fees, allowances, and expenses to which the person is entitled under section 111 have not been paid or ten- dered to him or her.
Compare: 2005 No 38 s 35 Subpart 4—Injunctions, banning orders, and other remedies Subpart 4: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Injunctions Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 39 of the Financial Advisers 137A Injunctions against contraventions (1) The High Court may, on application by the Commission, grant an injunction restraining a person from engaging in conduct that constitutes or would constitute a contravention of a pro- vision of this Act if— (a) the court is satisfied that the person has engaged in con- duct of that kind; or it appears to the court that, if an injunction is not granted, it is likely that the person will engage in con- duct of that kind.
(b) (2) (3) (4) In subsection (1), contravention includes aiding, abetting, counselling, or procuring the contravention.

The court may grant an interim injunction restraining a person from engaging in conduct of a particular kind if in its opinion it is desirable to do so.

Subsections (1)(a) and (3) apply whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind.
111 Part 4 s 137B Financial Advisers Act 2008 Reprinted as at 7 July 2010 (5) (6) Subsections (1)(b) and (3) apply whether or not the person has previously engaged in conduct of that kind or there is an imminent danger of substantial damage to any other person if that person engages in conduct of that kind.

In this section, engaging in conduct means doing or refusing to do an act, and includes— (a) (b) making it known that an act will or will not be done.
Compare: 1988 No 234 ss 2, 42K, 42L omitting to do an act; or Section 137A: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

137B Undertaking as to damages not required by Commission If the Commission applies to the High Court for the grant of (1) an interim injunction under section 137A, the court must not, as a condition of granting an interim injunction, require the Commission to give an undertaking as to damages.
(2) However, in determining the Commission’s application for the grant of an interim injunction, the court must not take into ac- count that the Commission is not required to give an undertak- ing as to damages.

Compare: 1988 No 234 s 42M Section 137B: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137C When court may make banning order The High Court may, on application by the Commission, make an order (a banning order) against a person if the court is satisfied that— (a) the person has been convicted of an offence against any of the following sections: (i) section 118 (misleading or deceptive conduct by financial adviser or broker): section 119 (misleading, deceptive, or confusing advertisement by financial adviser or broker): section 134B (receiving client money if offer for subscription illegal); or (ii) (iii) (b) the person has been convicted of an offence against any of sections 58, 59, and 59A of the Securities Act 1978 112 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137E (c) (d) (e) or a pecuniary penalty order has been made against the person under that Act; or the person has been convicted of a crime involving dis- honesty as defined in section 2(1) of the Crimes Act 1961; or the person has persistently contravened this Act or the Securities Act 1978; or the person has been prohibited in an overseas jurisdic- tion from carrying on activities that the court is satisfied are substantially similar to any of the activities referred to in section 137D.
Compare: 1988 No 234 s 43K Section 137C: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137D Terms of banning orders A banning order may prohibit or restrict the person against whom it is made from doing all or any of the following things, without the leave of the High Court, for a period stated in the order of 10 years or less: (a) (b) providing financial adviser services or broking services: being a director or promoter of, or in any way, whether directly or indirectly, being concerned or taking part in the management of, any incorporated or unincorporated body that provides financial adviser services or broking services (other than an overseas company, or an incorp- orated or unincorporated body, that does not carry on business in New Zealand): contributing, as employee or agent, to the provision of financial adviser services or broking services.
(c) Compare: 1988 No 234 s 43L Section 137D: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137E Offence of contravening banning order A person who acts in contravention of a banning order com- mits an offence and is liable on conviction on indictment,— (a) in the case of an individual, to imprisonment for a term not exceeding 3 years or to a fine not exceeding $100,000, or to both: 113 Part 4 s 137F Financial Advisers Act 2008 Reprinted as at 7 July 2010 (b) in the case of a body corporate, to a fine not exceeding $300,000.
Compare: 1988 No 234 ss 43E(2), 43M Section 137E: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Orders to preserve assets to satisfy claims Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 39 of the Financial Advisers 137F When High Court may prohibit payment or transfer of (1) (2) (3) money, securities, or other property This section applies if— (a) an investigation is being carried out under the Securities Act 1978 in relation to an act or omission by a person, being an act or omission that constitutes or may consti- tute a contravention of this Act; or a prosecution has begun against a person for a contra- vention of this Act.
(b) The High Court may, on application by the Commission or by an aggrieved person, make 1 or more of the orders listed in section 137G if the court considers it necessary or desirable to do so for the purpose of protecting the interests of an aggrieved person.
In this section and section 137G,— aggrieved person means any person to whom a relevant per- son is liable associated person has the same meaning as in section 2(2) of the Securities Markets Act 1988 liable means liable, or may be or become liable, to pay money (whether in respect of a debt, by way of damages or compensa- tion, or otherwise) or to account for securities or other property relevant person means a person referred to in subsection (1).
Compare: 1988 No 234 s 43P Section 137F: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137G What orders may be made (1) The orders that may be made under section 137F are— 114 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137G (a) (b) (c) (d) (e) (f) (g) an order prohibiting the relevant person from transfer- ring, charging, or otherwise dealing with money, secur- ities, or other property held or controlled by the relevant person: an order prohibiting a person who is indebted to the rele- vant person or to an associated person of the relevant person from making a payment in total or partial dis- charge of the debt to, or to another person at the direc- tion or request of, the person to whom the debt is owed: an order prohibiting a person holding money, securities, or other property, on behalf of the relevant person, or on behalf of an associated person of the relevant person, from paying all or any of the money, or transferring, or otherwise parting with possession of, the securities or other property, to, or to another person at the direction or request of, the person on whose behalf the money, securities, or other property, is or are held: an order prohibiting the taking or sending out of New Zealand by a person of money of the relevant person or of an associated person of the relevant person: an order prohibiting the taking, sending, or transfer by a person of securities or other property of the relevant person, or of an associated person of the relevant per- son, from a place in New Zealand to a place outside New Zealand (including the transfer of securities from a register in New Zealand to a register outside New Zealand): an order requiring the relevant person, or any person holding money, securities, or other property on behalf of the relevant person or an associated person of the relevant person, to pay or transfer money, securities, or other property to a specified person to be held on trust pending determination of the investigation or prosecu- tion: an order appointing,— (i) if the relevant person is a natural person, a re- ceiver or trustee, having any powers that the
 court orders, of the property or of part of the property of that person; or 115 Part 4 s 137H Financial Advisers Act 2008 Reprinted as at 7 July 2010 (ii) if the relevant person is a body corporate, a receiver or receiver and manager, having any powers that the court orders, of the property or of part of the property of that person: if the relevant person is a natural person, an order re- quiring that person to deliver up to the court his or her passport and any other documents that the court thinks fit: if the relevant person is a natural person, an order pro- hibiting that person from leaving New Zealand, without the consent of the court.
(h) (i) (2) A reference in subsection (1)(e) or (g) to property of a person includes a reference to property that the person holds other- wise than as sole beneficial owner, for example,— (a) as trustee for, as nominee for, or otherwise on behalf of or on account of, another person; or in a fiduciary capacity.

(b) (3) An order may be expressed to operate for a specified period or until the order is discharged by a further order under this section.
Compare: 1988 No 234 s 43Q Section 137G: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

137H Interim orders (1) If an application is made to the High Court for an order under section 137F, the court may, if in the opinion of the court it is desirable to do so, before considering the application, grant an interim order, being an order of the kind applied for that is expressed to have effect pending the determination of the application.
The court must not require the applicant or any other person, as a condition of granting an interim order under this section, to give an undertaking as to damages.

In determining an application for the grant of an interim order, the court must not take into account that the applicant is not required to give an undertaking as to damages.
Compare: 1988 No 234 s 43R (2) (3) 116 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137K Section 137H: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

137I Relationship with other law (1) Nothing in sections 137G and 137H affects the powers that the (2) court has apart from those sections.

This section has effect subject to the Insolvency Act 2006.
Compare: 1988 No 234 s 43S Section 137I: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137J Offence of breaching orders A person commits an offence who contravenes an order by the court under sections 137G or 137H that is applicable to the person and is liable on conviction on indictment,— (a) in the case of an individual, to imprisonment for a term not exceeding 3 years or to a fine not exceeding $100,000, or to both: in the case of a body corporate, to a fine not exceeding $300,000.
Compare: 1988 No 234 s 43T (b) Section 137J: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Pecuniary and compensatory orders for contravening wholesale certification requirement Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 39 of the Financial Advisers 137K Pecuniary order for contravening wholesale certification (1) requirement The High Court may, on application by the Commission, order a person to pay a pecuniary penalty to the Crown if the court is satisfied that the person has, without reasonable excuse, contravened a wholesale certification requirement under sec- tion 5E.
117 Part 4 s 137L Financial Advisers Act 2008 Reprinted as at 7 July 2010 (2) (3) The amount of the pecuniary penalty must not, in respect of each act or omission, exceed $100,000 in the case of an indi- vidual or $300,000 in the case of an entity.
In setting the amount of the pecuniary penalty, the court must take into account all of the following matters: (a) (b) the nature and extent of the contravention: the nature and extent of any loss or damage suffered by a person as a result of the contravention, including the effect on a person of the loss of an opportunity to make a complaint to an approved dispute resolution scheme: the circumstances in which the contravention took place (including whether the contravention was intentional, inadvertent, or caused by negligence): (c) (d) whether the person has previously been found by the court in proceedings under this Act to have engaged in similar conduct.
(4) A financial adviser or broker may not be liable to more than (5) 1 pecuniary penalty in respect of the same conduct.

Proceedings under this section may be commenced at any time within 3 years after the contravention occurred.

Section 137K: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137L Compensation for contravention of wholesale certification (1) requirement If the court orders a person to pay a pecuniary penalty under section 137K in respect of the contravention of a wholesale certification requirement, the court may, in addition, order a person to pay compensation to any person who has suffered, or is likely to suffer, loss or damage as a result of the contra- vention (the aggrieved person).
(2) An application for orders under this section may be made by the Commission or any aggrieved person.

The application must be made within 1 year of the date of the pecuniary penalty order.

The court may make an order under this section whether or not any aggrieved person is a party to the proceedings.

(3) (4) 118 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137N (5) In proceedings under this section, the court may make such orders as it thinks fit.
Section 137L: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Temporary banning orders against financial adviser and broker Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 39 of the Financial Advisers 137M When Commission may make temporary banning orders for financial adviser services or broking services The Commission may make an order (a temporary banning order) against a person in accordance with sections 137N to 137R if the Commission is satisfied that— (a) the person has persistently contravened this Act or the Securities Act 1978; or the person has been prohibited in an overseas jurisdic- tion from carrying on activities that the Commission is satisfied are substantially similar to any of the activities referred to in section 137N.
(b) Compare: 1988 No 234 s 42D Section 137M: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137N Terms of temporary banning order A temporary banning order may prohibit or restrict a person from doing all or any of the following things, without the leave of the Commission, for a period stated in the order of 14 days or less: (a) (b) providing financial adviser services or broking services: being a director or promoter of, or in any way, whether directly or indirectly, being concerned or taking part in the management of, any incorporated or unincorporated body that provides financial adviser services or broking services (other than an overseas company, or an incorp- orated or unincorporated body, that does not carry on business in New Zealand): 119 Part 4 s 137O Financial Advisers Act 2008 Reprinted as at 7 July 2010 (c) contributing, as employee or agent, to the provision of financial adviser services or broking services.
Compare: 1988 No 234 s 42E Section 137N: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).

Process for Commission’s orders inserted, on 1 July 2010, by section 39 of the Financial Advisers Heading: Amendment Act 2010 (2010 No 40).
137O Commission must follow steps before making orders (1) Unless section 137P applies, the Commission may make a temporary banning order only if it first takes the following steps: (a) the nature of the alleged contravention; and the proposed terms of the order; and the reasons for the proposed order; and gives the person to whom the order is directed written notice of— (i) (ii) (iii) gives that notice at least 24 hours before the Commis- sion makes the order; and gives the person an opportunity to make written submis- sions within that notice period; and has regard to any written submissions made to it within that notice period and (if applicable) written or oral sub- missions made at a meeting of the Commission.
(b) (c) (d) (2) However, the Commission may shorten these steps in accord- ance with section 137P in the circumstances specified in that section.

Compare: 1988 No 234 s 42F Section 137O: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137P Commission may shorten steps for specified orders (1) If the Commission thinks it necessary or desirable in the pub- lic interest for a temporary banning order to be made more urgently than section 137O permits, it— (a) may give less than 24 hours’ notice before it makes the order, and the notice may be oral, not written; and 120 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 4 s 137R (b) may give persons an opportunity to make only oral sub- missions, not written, to a member, officer, or employee of the Commission (as the Commission determines).
(2) However, the Commission must include in the notice under section 137O the reasons for acting urgently and must other- wise comply with the steps set out in that section.

Compare: 1988 No 234 s 42G Section 137P: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137Q Commission must give notice after making orders (1) If the Commission makes a temporary banning order, the Commission— (a) must, as soon as is reasonably practicable, give written notice to the person to whom the order is directed of— (i) (ii) the terms of the order; and the reasons for the order; and (b) may also give notice to any other person of those mat- ters.
(2) The Commission must also, as soon as practicable after mak- ing the temporary banning order, give notice on an Internet site maintained by or on behalf of the Commission (and may give public notice by any other means also) of the name of the person against whom the order is made and the period or dates for which the ban applies.

Compare: 1988 No 234 s 42H Section 137Q: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137R General provisions on temporary banning orders (1) The Commission may make a temporary banning order on the terms and conditions that the Commission thinks fit.

The Commission may vary a temporary banning order in the same way as it makes such an order under section 137O to 137Q.

The Commission may revoke a temporary banning order or suspend it on the terms and conditions it thinks fit.
(2) (3) 121 Part 4 s 137S Financial Advisers Act 2008 Reprinted as at 7 July 2010 (4) A temporary banning order is subject to appeal only in accord- ance with section 69P of the Securities Act 1978.

Compare: 1988 No 234 s 42I Section 137R: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
137S Offence of failing to comply with Commission’s orders (1) A person who contravenes a temporary banning order commits an offence and is liable on summary conviction to a fine not exceeding $30,000.
(2) No person may be convicted of an offence against subsection (1) if— (a) (b) (c) the person proves that the contravention occurred with- out the person’s knowledge or without the person’s knowledge of the order; or the contravention was in respect of matters that, in the court’s opinion, were immaterial; or the court thinks that the contravention, in the circum- stances of the case, ought reasonably to be excused.
Compare: 1988 No 234 s 42J Section 137S: inserted, on 1 July 2010, by section 39 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Part 5 General provisions Appeal of decisions 138 Right of appeal (1) A person affected may appeal to a District Court against any decision of— (a) the Commission to— (i) (ii) (iii) decline authorisation under section 55(4); or decline QFE status under section 67(4); or take any action referred to in section 59(2) or 71(2); or give a direction under section 49, 61, 75F, or 77V; or (iv) (b) the disciplinary committee to take any action referred to in section 101(3) or (5).
122 Reprinted as at 7 July 2010 (2) An appeal— Financial Advisers Act 2008 Part 5 s 141 (a) must be brought to the District Court by way of notice of appeal in accordance with the rules of court; and (b) must be lodged within 20 working days after notice of the decision is communicated to the appellant, or within any further time a District Court Judge allows on appli- cation made before or after the period expires.
Compare: 2005 No 38 s 38 Section 138(1)(a)(ii): amended, on 28 July 2009, by section 13 of the Financial Advisers Amendment Act 2009 (2009 No 24).

Section 138(1)(a)(iv): amended, on 1 July 2010, by section 40 of the Financial Advisers Amendment Act 2010 (2010 No 40).
139 Notice of right of appeal When notifying a person under this Act of any decision against which section 138 gives him or her a right of appeal, the Com- mission or the disciplinary committee must also notify the per- son in writing of the right of appeal and the time within which an appeal must be lodged.
Compare: 2005 No 38 s 39 140 Decision to have effect pending determination of appeal A decision against which an appeal is lodged under this Part continues in force unless the District Court orders otherwise.

Compare: 2005 No 38 s 40 141 Procedure on appeal (1) An appeal under this Part must be heard as soon as is reason- ably practicable after it is lodged.

(2) An appeal under this Part is by way of rehearing.
(3) On hearing the appeal, the District Court— (a) may confirm, reverse, or modify the decision appealed against; and (b) may make any other decision that the person or body that made the decision appealed against could have made.

(4) The court must not review— (a) any part of a decision not appealed against; or 123 Part 5 s 142 Financial Advisers Act 2008 Reprinted as at 7 July 2010 any decision not appealed against at all.
(b) Compare: 2005 No 38 s 41 142 Court’s decision final Except as provided in section 146, the decision of the District Court on an appeal under this Part is final.

Compare: 2005 No 38 s 42 143 Court may refer matter back for reconsideration (1) Instead of determining an appeal under this Part, the District Court may direct the person or body whose decision is under appeal to reconsider, either generally or in respect of any spe- cified aspect, the whole or any part of the decision.
In giving a direction under subsection (1), the court— (a) must state its reasons for the direction; and (b) may give any other directions it thinks just in relation to the matter referred back for reconsideration.

(2) (3) Upon being directed to reconsider a matter, the person or body whose decision is under appeal— (a) must reconsider the matter; and (b) in doing so, must— (i) (ii) take the court’s reasons into account; and give effect to the court’s directions.
Compare: 2005 No 38 s 43 144 Orders as to costs On an appeal under this Part, the District Court may order any party to the appeal to pay to any other party to the appeal any or all of the costs incurred by the other party in respect of the appeal.
Compare: 2005 No 38 s 44 145 Orders as to publication of names (1) On any appeal under this Part, the District Court may, if in its opinion it is proper to do so, prohibit the publication of the name or particulars of the affairs of a financial adviser or any other person.
124 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 147 (2) In deciding whether to make an order under subsection (1), the court must have regard to— (a) the interests of any person (including, without limita- tion, the privacy of any complainant); and the public interest.

(b) Compare: 2005 No 38 s 45(1), (2) (2) 146 Appeal on question of law (1) A party to an appeal under this Part may appeal to the High Court against any determination of law arising in the appeal.
The appeal must be heard and determined in accordance with the appropriate rules of court.

Part 4 of the Summary Proceedings Act 1957 (together with the other provisions of that Act that are applied in that Part) applies to the appeal— (a) so far as it is applicable and with all necessary modifi- cations; but only so far as it relates to appeals on questions of law.

(3) (4) (b) Subsection (3) overrides subsection (2).
Compare: 2005 No 38 s 46 Securities Commission: General powers 147 Commission may exercise powers under Securities Act (1) (2) 1978 The Commission may exercise any of its powers under the Securities Act 1978 in performing its functions under this Act.

Part 3 of the Securities Act 1978 applies to the exercise by the Commission of any of its powers under the Securities Act 1978 in the performance of its functions under this Act.
Compare: 1988 No 234 s 44 Standard conditions for incorporation in authorisation and grants Heading: Amendment Act 2010 (2010 No 40).
inserted, on 1 July 2010, by section 41 of the Financial Advisers 125 Part 5 s 147A Financial Advisers Act 2008 Reprinted as at 7 July 2010 147A Approval of standard conditions for incorporation in (1) (2) authorisations and grants of QFE status The Commission may, by notice in the Gazette,— (a) approve standard conditions for incorporation in author- isations of financial advisers under section 55: approve standard conditions for incorporation in grants of QFE status under section 67.
(b) The notice may state a date in relation to any specified standard condition on which the standard condition is incorporated into the authorisations of financial advisers or into the grants of QFE status.
(3) However, if a standard condition proposed to be approved does not relate to a reporting or accounting requirement, a date may be stated under subsection (2) in relation to that standard con- dition only if that standard condition— (a) will, in the opinion of the Commission, have little or no effect on authorised financial advisers or, as the case requires, on QFEs, or will be solely beneficial; or is made in response to an emergency; or is necessary to comply with statutory or international obligations; or is necessary to avoid an unfair commercial advantage being taken; or is necessary to avoid the defeat of the purpose of this Act.
(b) (c) (d) (e) (4) The notice in the Gazette need not set out the standard condi- tions, but those conditions must be— (a) published on an Internet site maintained by or on behalf of the Commission; and (b) made available in printed form for purchase on request by members of the public.

Section 147A: inserted, on 1 July 2010, by section 41 of the Financial Advisers Amendment Act 2010 (2010 No 40).
147B Requirement to consult on proposal to incorporate material by reference Before the Commission approves standard conditions under section 147A, the Commission must— (1) 126 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 147C (a) make copies of the proposed standard conditions avail- able for inspection during working hours for a reason- able period, free of charge; and state where copies of the proposed standard conditions are available for purchase; and (b) (c) make copies of the proposed standard conditions avail- able on an Internet site maintained by or on behalf of the Commission; and give notice in the Gazette stating— (i) (d) (ii) how the proposed standard conditions can be in- spected, purchased, or accessed on the Internet site address; and specifying a period within which any person may make a written submission to the Commission on the proposed standard conditions and, if applic- able, on the date on which the standard condition is to be incorporated.
(2) (3) If the Commission proposes that any standard condition should be incorporated on a specified date, the notice given under subsection (1)(d) must also state why the Commission considers that the standard condition should apply to current authorisations of financial advisers or to current grants of QFE status ahead of the renewal of those authorisations or grants.

The Commission must consider any submissions received within the period specified under subsection (1)(d)(ii).
Section 147B: inserted, on 1 July 2010, by section 41 of the Financial Advisers Amendment Act 2010 (2010 No 40).

147C Variation or revocation of standard conditions (1) The Commission may approve variations or revocations of any standard conditions under section 147A in the same way as standard conditions are approved under that section.

section 147A and 147B apply to any proposed approval of variation or revocation of standard conditions, with any ne- cessary modifications.
Section 147C: inserted, on 1 July 2010, by section 41 of the Financial Advisers Amendment Act 2010 (2010 No 40).

(2) 127 Part 5 s 147D Financial Advisers Act 2008 Reprinted as at 7 July 2010 147D When standard conditions come into force The approval of standard conditions, or of variation or revoca- tion of standard conditions, comes into force on the 28th day after the date on which the approval is notified in the Gazette.
Section 147D: inserted, on 1 July 2010, by section 41 of the Financial Advisers Amendment Act 2010 (2010 No 40).
147E Incorporation of changed standard conditions into existing authorisations or grants A standard condition, or a variation or revocation of a standard condition, that has come into force is incorporated into the au- thorisation of an authorised financial adviser or into the grant of QFE status of a QFE— (a) if the notice approving the condition, variation, or revo- cation states a date under section 147A(2), on that date; and in any other case, when, and to the extent that, the condi- tion is incorporated on the renewal of the authorisation or grant under section 58 or 75C.
(b) Section 147E: inserted, on 1 July 2010, by section 41 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Exemptions 148 Commission may grant exemptions (1) (b) The Commission may, in its discretion and on any terms and conditions as it thinks fit, exempt any person or class of per- sons, service or class of service, or any transaction or class of transactions from— (a) compliance with any obligation under this Act, the regu- lations, or the code: the obligation to register under the FSP Act by virtue of providing financial adviser services or broking services.
The Commission must be satisfied, before it grants an exemp- tion (except as provided in subsection (3)), that— (a) the costs of compliance with the relevant obligation— (i) (ii) would not be justified by the benefit of compli- would be unreasonable; or ance; or (2) 128 Reprinted as at 7 July 2010 (b) Financial Advisers Act 2008 Part 5 s 148B the relevant person, service, or transaction is subject to the regulations of an overseas jurisdiction and the Commission is satisfied that, in the circumstances, the protection of the New Zealand public is unlikely to be prejudiced.
(3) If a proposed exemption would exempt a person applying to be an authorised financial adviser from obligations imposed by the code in respect of competence, the Commission must be satisfied that the exemption would not undermine consumer protection and that— (a) the applicant has qualifications that are comparable to standards required by the code; or the costs of compliance with the obligation would be— (i) (ii) unreasonable; or not justified by the benefit of compliance.
(b) Section 148: substituted, on 1 July 2010, by section 42 of the Financial Advisers Amendment Act 2010 (2010 No 40).

148A Commission may vary or revoke exemption (1) The Commission may vary the exemption in the same way as it may grant the exemption under section 148.

The Commission may revoke the exemption.

Section 148A: inserted, on 1 July 2010, by section 42 of the Financial Advisers Amendment Act 2010 (2010 No 40).
(2) 148B Status of exemptions, variations, or revocations (1) An exemption under section 148, or a variation or revocation of an exemption under section 148A, is a regulation for the purposes of the Regulations Disallowance Act 1989, but is not a regulation for the purposes of the Acts and Regulations Publication Act 1989 unless it is a class exemption.
(2) An exemption that is not a class exemption must, as soon as practicable after being granted, be— (a) published on an Internet site maintained by or on behalf of the Commission; and notified in the Gazette; and (b) (c) made available in printed form for purchase on request by members of the public.
129 Part 5 s 149 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (3) In this section and in section 149, class exemption means an exemption that— (a) (b) (c) is not an exemption from the code; and applies to a class of persons or transactions; but does not include an exemption granted in relation to a particular person, service, or transaction.

Section 148B: inserted, on 1 July 2010, by section 42 of the Financial Advisers Amendment Act 2010 (2010 No 40).
149 Commission must notify reasons for exemption other than class exemption (1) When the Commission grants an exemption other than a class exemption, the Commission must notify the reasons for grant- ing the exemption (including why the exemption is appropri- ate) in the Gazette.

(2) However, the Commission may defer notifying or not notify the reasons for granting an exemption if the Commission is satisfied that it is proper to do so on the ground of commercial confidentiality.
Compare: 1988 No 234 s 48A Section 149 heading: amended, on 1 July 2010, by section 43(1) of the Financial Advisers Amendment Act 2010 (2010 No 40).

Section 149(1): substituted, on 1 July 2010, by section 43(2) of the Financial Advisers Amendment Act 2010 (2010 No 40).

150 Commission may vary or revoke exemption [Repealed] Section 150: repealed, on 1 July 2010, by section 44 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Information sharing Information sharing The Commission may communicate to any of the agencies re- ferred to in subsection (4) any information that the Commis- sion— (a) holds in relation to the exercise of the Commission’s powers, or the performance of its functions and duties, under this Act; and 151 (1) 130 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 153 (2) (3) (4) (5) (b) considers may assist the agency in the exercise of its powers or the performance of its functions and duties.
The Commission may use any information communicated to it by an agency referred to in subsection (4) in the exercise of the Commission’s powers, or the performance of its functions and duties, under this Act.

This section applies no matter what any enactment, contract, deed, or document may say.
The agencies to which this section applies are the following: (a) (b) (c) (d) (e) (f) The Commission may impose any conditions in relation to communicating information to an agency to which this sec- tion applies, including (without limitation) conditions relating to— (a) maintaining the confidentiality of the information (in information the Registrar: the Commerce Commission: the New Zealand Police: an approved dispute resolution scheme: a licensing authority listed in Schedule 2 of the FSP Act: an overseas regulator.
information that particular, within the meaning of the Privacy Act 1993): the storing of, use of, or access to the information: the copying, returning, or disposing of the information: payment of the costs incurred by the Commission in communicating the information.

is personal (b) (c) (d) Fees and levies 152 Commission’s fees, charges, and costs (1) Regulations may be made under section 155 for the payment to the Commission of fees, charges, and costs.
If regulations have been made under section 155(2) author- ising the Commission to do so, the Commission may require payment of any costs incurred by the Commission.

(2) 153 Levy (1) The Governor-General may, by Order in Council made on the recommendation of the Commission, make regulations requir- 131 Part 5 s 153 Financial Advisers Act 2008 Reprinted as at 7 July 2010 ing authorised financial advisers and QFEs to pay a levy to the Commission.
The purpose of the levy is to meet, in whole or in part, the costs of the Commission, the Commissioner, the code committee, and the disciplinary committee in performing their functions and duties under this Act (and the costs of collecting the levy).
Regulations under this section may— (a) specify an amount payable as the levy or a method of calculating or ascertaining the levy (which may be based on the estimated costs): include or provide for including in the levy any shortfall in recovering the actual costs: refund or provide for refunds of any over-recovery of those actual costs: specify the financial year or part financial year to which the levy applies, and apply the levy to that financial year or part financial year and each subsequent financial year until the levy is revoked or repealed: for the first financial year to which the levy applies, include in the levy costs from 1 January 2009: require payment of a levy for a financial year or part financial year irrespective of the fact that the regulations may be made after that financial year has commenced: provide for the collection and payment of the levy, in- cluding the time by which the levy must be paid: exempt a person or class of persons from liability to pay the levy, in whole or in part: provide for a waiver or refund of the levy, in whole or in part, for a person or class of persons: provide for interest to be paid if a person fails to pay the levy by the due date: provide for the cancellation of authorisation of an au- thorised financial adviser who fails to pay the levy by the due date: provide for the cancellation of QFE status of a QFE who fails to pay the levy by the due date.
(b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Regulations under this section may make different provision for authorised financial advisers and QFEs and for different classes of authorised financial adviser and QFE.

(2) (3) (4) 132 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 154 (5) The levy is recoverable as a debt due to the Commission.

Section 153: substituted, on 1 July 2010, by section 45 of the Financial Advisers Amendment Act 2010 (2010 No 40).
Regulations 154 General regulations (1) The Governor-General may, by Order in Council made on the recommendation of the Minister in accordance with subsec- tions (4) to (8), make regulations— (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) exempting any person, service, document, information, or product or class of persons, services, documents, in- formation, or products from all or any of the provisions of this Act or the regulations, and prescribing the terms and conditions (if any) of the exemption: specifying the person that is the product provider in re- lation to a financial product other than a security, con- sumer credit contract, or contract of insurance: specifying a product as a category 1 product: specifying a product as a category 2 product: defining investment-linked contract of insurance, land investment product, and cash or term portfolio invest- ment entity: providing for disclosure by financial advisers under sec- tions 22 to 24 and for QFEs under section 25: prescribing the form of disclosure that (in addition to the matters set out in subsection (2)) may include a maxi- mum length of a form and that some or all of the in- formation that must be disclosed must be included in 1 disclosure statement: specifying, for the purposes of section 55(1)(d), cases in which an authorisation under that paragraph may be granted: providing for disclosure by brokers under sections 77E and 77F: prescribing when, and subject to what terms and con- ditions, disclosure may be made in a joint disclosure document (whether
 by financial advisers or by brokers jointly, or by 1 or more persons in different capacities) and the form of a joint disclosure document: 133 Part 5 s 154 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (ii) (iii) prescribing requirements relating to class services pro- vided to retail clients for the purposes of section 36: prescribing the following matters in relation to Part 3A: the duties of brokers in relation to their trust ac- (i) counts (including who may be a related person or entity for
 the purposes of section 77P and what entities are prescribed for the purposes of the trust account), and other provisions regulating their establishment and use: provisions regulating the keeping, inspection, and audit of trust account records or other records in connection with the receipt, holding, payment, and transfer of client money and client property, and prescribing the duties in relation to those records: any other requirements necessary or desirable to ensure that trust accounts are duly kept and that persons on whose behalf client money and client property are held by brokers are informed of the client money and client property held and of the transactions made in connection with it: prescribing the form of an application for authorisation: prescribing the form of an application for the grant of QFE status: prescribing information that must be contained in a QFE’s annual report: prescribing the procedure of the code committee: prescribing the procedure of the disciplinary commit- tee: providing that, subject to any conditions stated in transitional or savings provisions the regulations, prescribed by the regulations that relate to the imple- mentation of this Act or the Financial Service Providers (Registration and Dispute Resolution) Act 2008 (in addition to any other transitional provisions in those Acts) apply during the whole or any part of the transi- tional implementation period ending on 30 June 2013: providing that, subject to any conditions stated in the regulations, specified provisions of this Act or the (k) (l) (m) (n) (o) (p) (q) (r) (s) 134 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 154 Financial Service Providers (Registration and Dis- pute Resolution) Act 2008 (including definitions), or provisions of other Acts amended by this Act or the Financial Service Providers (Registration and Dispute Resolution) Act 2008, do not apply, or apply with modifications or additions, or both, during the whole or any part of the
 transitional implementation period ending on 30 June 2013: providing for any other matters contemplated by this Act, necessary for its administration, or necessary for giving it full effect.
(t) (2) (3) (4) (5) (6) In subsection (1), prescribing the form includes specifying additional content, means of communication, or any other re- quirement of form without necessarily specifying the use of a particular form.
Regulations for the purposes of subsection (1) may make dif- ferent provision for different classes of financial adviser or broker, financial adviser service or broking service, and client, and for different circumstances in which a financial adviser service or broking service is provided.

The Minister must consult with the Commission before mak- ing a recommendation under subsection (1).
The Minister must not recommend the making of regulations under subsection (1)(a) unless the Minister is satisfied that— the exemption is consistent with the purposes of the Act; (a) and the costs of compliance with the provision or provisions to which the exemption relates would be unreasonable or not justified by the benefit of compliance; and the extent of the exemption is not broader than what is reasonably necessary to address the matters that gave rise to the exemption.
(b) (c) The Minister must not recommend the making of regulations under paragraph (r) or (s) of subsection (1) unless the Minister is satisfied that the regulations— (a) are necessary or desirable for the orderly implemen- tation of this Act or the Financial Service Providers (Registration and Dispute Resolution) Act 2008; and 135 Part 5 s 155 Financial Advisers Act 2008 Reprinted as at 7 July 2010 (b) are consistent with the purposes of this Act or of the Financial Service Providers (Registration and Dispute Resolution) Act 2008.
(7) Paragraphs (r) and (s) of subsection (1) expire, and are re- pealed, on the close of 30 June 2013.

(8) Any regulations made under paragraph (r) or (s) of subsection (1) that are in force on 30 June 2013 expire, and are revoked, on the close of that day.

Section 154: substituted, on 1 July 2010, by section 46 of the Financial Advisers Amendment Act 2010 (2010 No 40).
155 Regulations relating to fees, charges, and costs (1) The Governor-General may from time to time, by Order in Council, make regulations— (a) requiring the payment to the Commission of fees and charges— (i) in connection with the performance by the Com- mission of any function or duty, or the exercise of any power, under this Act; or on an application to the Commission to perform any function or duty, or exercise any power, under this Act; and (ii) (2) (b) (c) prescribing the amounts of the fees and charges payable to the Commission; and prescribing the amount of any other fee required to be paid under this Act.
The Governor-General may from time to time, by Order in Council, make regulations authorising the Commission to re- quire payment to it of any costs incurred by the Commission in the performance by the Commission of any function or duty, or the exercise of any power, under this Act.

156 No contracting out Other matters The provisions of this Act have effect no matter what any agreement may say.
Compare: 1988 No 234 s 41V 136 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 161 157 Territorial scope (1) (2) This Act applies to a financial adviser service or broking ser- vice received by a client in New Zealand, regardless of where the person providing the service is resident, is incorporated, or carries on business.
Sections 33, 34, 49, 77K, 77L, 77V, and 118 also extend to any financial adviser service or broking service received by a client outside New Zealand if it is provided by a person who is ordinarily resident in New Zealand (within the meaning of section 4 of the Crimes Act 1961) or is incorporated or has a place of business in New Zealand.

Section 157: substituted, on 1 July 2010, by section 47 of the Financial Advisers Amendment Act 2010 (2010 No 40).
158 Breach of exemption conditions The breach of a term or condition of an exemption provided by regulations made under this Act or by notice under section 148 is a breach of the obligation to which the exemption applies.

Compare: 1988 No 234 s 49E 159 Exemption or regulation in respect of specified overseas jurisdictions [Repealed] Section 159: repealed, on 1 July 2010, by section 48 of the Financial Advisers Amendment Act 2010 (2010 No 40).
160 Time for laying information for summary offences (1) Any information for an offence against this Act punishable on summary conviction may be laid at any time within 3 years after the date of the offence.

Subsection (1) applies despite section 14 of, or anything else to the contrary in, the Summary Proceedings Act 1957.
Compare: 1988 No 234 s 43U (2) 161 Ministry must review and report on operation of Act (1) The Ministry must, not later than 5 years after the commence- ment of this section,— (a) review the operation of this Act since the commence- ment of this section; and 137 Part 5 s 161A Financial Advisers Act 2008 Reprinted as at 7 July 2010 (2) prepare a report on the review for the Minister.
(b) The report on the review must include recommendations to the Minister on whether any amendments to the Act are necessary or desirable.

(3) As soon as practicable after receiving the report, the Minister must present a copy of that report to the House of Representa- tives.

Other legislation affected 161A Financial Service Providers (Registration and Dispute (1) (2) Resolution) Act 2008 amended This section amends the Financial Service Providers (Regis- tration and Dispute Resolution) Act 2008.
Section 7(2)(m) is amended by adding “, except to the extent that an individual may be required to be registered in order to perform a financial adviser service under the Financial Advis- ers Act 2008”.

Section 161A: inserted, on 28 July 2009, by section 15 of the Financial Advisers Amendment Act 2009 (2009 No 24).

162 KiwiSaver Act 2006 amended (1) (2) This section amends the KiwiSaver Act 2006.
The heading to section 206 is amended by omitting “invest- ment advice” and substituting “financial adviser service”.

Section 206 is amended by omitting “give investment advice and is not an investment broker or a broker, for the purposes of the Investment Advisers (Disclosure) Act 1996” and sub- stituting “perform a financial adviser service for the purposes of the Financial Advisers Act 2008”.

(3) 163 Securities Act 1978 amended (1) (2) This section amends the Securities Act 1978.
Section 10(1)(b) is amended by inserting “financial advisers,” after “securities,” in the first place where it appears.

Section 10(1)(c) is amended by inserting “and financial advis- ers” after “securities”.

(3) 138 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 165 (4) (5) (6) Section 10(1)(d) is amended by inserting “and the law and practice relating to financial advisers” after “securities”.

Section 11(1) is amended by omitting “10” and substituting “11”.
Section 11 is amended by inserting the following subsection after subsection (3B): “(3C) One of the members must be appointed by the Governor-Gen- eral as Commissioner for Financial Advisers under section 79(3) of the Financial Advisers Act 2008.” Schedule 1 is amended by omitting the item “Securities Mar- kets Act 1988 Part 4” and substituting the item “Financial Ad- visers Act 2008”.

(7) 164 Securities Markets Act 1988 amended (1) (2) This section amends the Securities Markets Act 1988.
Section 2(1) is amended by repealing the following def- initions: advertisement, advice advertisement, broker advertisement, investment advice and advice, investment adviser and adviser, investment advisers’ disclosure obli- gations and investment advisers’ obligations, investment broker and broker, investment brokers’ disclosure obli- gations and investment brokers’ obligations, investment brokers’ service, investment money and money, and in- vestment property and property.
Paragraph (e) of the definition of security in section 2(1) is repealed.

Part 4 is repealed.

Sections 42B(d), 42D, 42E, 42G(3)(b), 42N(b), 42P(c), 42S(f), 42T(2)(b), 42ZC, 42ZD, 43D, 43E(1)(a), 43E(3)(a) and (b), and 43K to 43N are repealed.

[Repealed] Sections 48(1)(c) and 49C are repealed.

Section 164(6): repealed (without coming into force), on 28 July 2009, by sec- tion 16 of the Financial Advisers Amendment Act 2009 (2009 No 24).
(3) (4) (5) (6) (7) 165 Sharebrokers Act 1908 repealed The Sharebrokers Act 1908 (1908 No 176) is repealed.

139 Part 5 s 166 Financial Advisers Act 2008 Reprinted as at 7 July 2010 166 Securities Markets (Investment Advisers and Brokers) Regulations 2007 revoked The Securities Markets (Investment Advisers and Brokers) Regulations 2007 (SR 2007/374) are revoked.
Transitional provisions (1) 167 Transitional provisions for existing offences and contravention under Securities Markets Act 1988 This section applies to an offence committed under, or a contravention of, the Securities Markets Act 1988 before section 164 comes into force.
The Securities Markets Act 1988 continues to have effect as if it had not been amended by this Act for the purpose of— (a) (2) investigating an offence or contravention to which this section applies: commencing or completing proceedings for an offence or contravention to which this section applies: imposing a penalty or other remedy, or making an order, in relation to an offence or contravention to which this section applies.
(b) (c) 168 Grant of authorisations in transitional period without (1) (2) prior inquiry into convictions In this section, transitional period means the period that com- mences on the commencement of section 55 and ends on the commencement of section 17.

In the transitional period, the Commission may authorise a person under section 55 even though it has not yet undertaken or completed its inquiries in relation to section 54(b).
(3) An authorisation granted in reliance on subsection (2) is sub- ject to the condition that it ceases to have effect if, before the expiry of the transitional period, the Commission notifies the applicant for authorisation that he or she is, given section 54(b), ineligible to be authorised.
If, at any time after the expiry of the transitional period, the Commission is satisfied that an authorised financial adviser is, given section 54(b), ineligible to be authorised, but that the ad- viser has been granted authorisation in reliance on subsection (4) 140 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Part 5 s 168 (2), section 59(1)(a) applies to that adviser as if he or she had ceased to be eligible for authorisation.
Section 168: added, on 1 July 2010, by section 49 of the Financial Advisers Amendment Act 2010 (2010 No 40).

141 Notes Financial Advisers Act 2008 Reprinted as at 7 July 2010 Contents 1 2 3 4 General Status of reprints How reprints are prepared Changes made under section 17C of the Acts and Regulations Publication Act 1989 List of amendments incorporated in this reprint (most recent first) General This is a reprint of the Financial Advisers Act 2008.
The reprint incorporates all the amendments to the Act as at 7 July 2010, as specified in the list of amendments at the end of these notes.

Relevant provisions of any amending enactments that contain transitional, savings, or application provisions that cannot be compiled in the reprint are also included, after the principal enactment, in chronological order.

For more information, see http://www.pco.parliament.govt.nz/reprints/.
Status of reprints Under section 16D of the Acts and Regulations Publication Act 1989, reprints are presumed to correctly state, as at the date of the reprint, the law enacted by the principal enactment and by the amendments to that enactment.

This presumption applies even though editorial changes authorised by section 17C of the Acts and Regulations Publication Act 1989 have been made in the reprint.
This presumption may be rebutted by producing the official volumes of statutes or statutory regulations in which the principal enactment and its amendments are contained.

How reprints are prepared editorial A number in the preparation of enacting words are of conventions reprints.

not included are For example, in Acts, followed the and 5 Notes 1 2 3 142 Reprinted as at 7 July 2010 Financial Advisers Act 2008 Notes that are repealed or revoked are omitted.
provisions For a detailed list of see http://www.pco.parliament.govt.nz/editorial-conventions/ or Part 8 of the Tables of New Zealand Acts and Ordinances and Statutory Regulations and Deemed Regulations in Force.
the editorial conventions, 4 Changes made under section 17C of the Acts and Regulations Publication Act 1989 Section 17C of the Acts and Regulations Publication Act 1989 authorises the making of editorial changes in a reprint as set out in sections 17D and 17E of that Act so that, to the extent permitted, the format and style of the reprinted enactment is consistent with current legislative drafting practice.

Changes that would alter the effect of the legislation are not permitted.
A new format of legislation was introduced on 1 January 2000.

Changes to legislative drafting style have also been made since 1997, and are ongoing.

To the extent permitted by section 17C of the Acts and Regulations Publication Act 1989, all legislation reprinted after 1 January 2000 is in the new format for legislation and reflects current drafting practice at the time of the reprint.
In outline, the editorial changes made in reprints under the authority of section 17C of the Acts and Regulations Publication Act 1989 are set out below, and they have been applied, where relevant, in the preparation of this reprint: • omission of unnecessary referential words (such as “of this section” and “of this Act”) typeface and type size (Times Roman, generally in 11.5 point) layout of provisions, including: • • indentation position of section headings (eg, the number and heading now appear above the section) format of definitions (eg, the defined term now appears in bold type, without quotation marks) format of dates (eg, a date formerly expressed as “the 1st day of January 1999” is now expressed as “1 January 1999”) 143 • • • • Notes Financial Advisers Act 2008 Reprinted as at 7 July 2010 • • • • • • • position of the date of assent (it now appears on the front page of each Act) punctuation (eg, colons are not used after definitions) Parts numbered with roman numerals are replaced with arabic numerals, and all cross-references are changed accordingly case and appearance of letters and words, including: • followed by small capital format of headings (eg, headings where each word formerly appeared with an initial capital letter letters are amended so that the heading appears in bold, with only the first word (and any proper nouns) appearing with an initial capital letter) small capital letters in section and subsection references are now capital letters • schedules are renumbered (eg, Schedule 1 replaces First Schedule), and all cross-references are changed accordingly running heads (the information that appears at the top of each page) format of amendments, and schedules of are rearranged into alphabetical order, chronological).
two-column schedules of consequential they rather than repeals (eg, List of amendments incorporated in this reprint (most recent first) New Zealand Institute of Chartered Accountants Amendment Act 2010 (2010 No 74): section 10 Financial Advisers Amendment Act 2010 (2010 No 40) Financial Advisers Amendment Act 2009 (2009 No 24) Financial Advisers Act Commencement Order 2008 (SR 2008/412) Wellington, New Zealand: Published under the authority of the New Zealand Government—2010 5 12 144