Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698751380996.pdf (New Zealand)
2011/212 Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 Anand Satyanand, Governor-General Order in Council At Wellington this 20th day of June 2011 Present: His Excellency the Governor-General in Council Pursuant to section 154(1)(a), (d), and (e) of the Financial Advisers Act 2008, His Excellency the Governor-General, acting on the advice and with the consent of the Executive Council, and on the recommen- dation of the Minister of Commerce made after consulting the Finan- cial Markets Authority in accordance with section 154(4) of that Act and being satisfied of the matters specified in section 154(5) of that Act, makes the following regulations.
Contents 1 2 3 4 Title Commencement Principal regulations amended Meaning of cash or term portfolio investment entity Page 2 2 2 2 1 r 1 Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 2011/212 Meaning of investment-linked contract of insurance New regulations 7A to 7C inserted 7A 7B 7C Public Trust term deposit is category 2 product Bank notice product is category 2 product Certain building society fixed term redeemable shares are category 2 products New regulation 12 added 12 Exemption for retirement village operators 2 3 3 3 4 4 4 Regulations Title These regulations are the Financial Advisers (Definitions, Vol- untary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011.
Commencement These regulations come into force on 1 July 2011.

Principal regulations amended These regulations amend the Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemp- tions) Regulations 2011.

Meaning of cash or term portfolio investment entity Paragraph (b) of the definition of specified PIE in regulation 4(2) is amended by inserting “debt securities that are bank no- tice products,” after “bank term deposits,”.
Meaning of investment-linked contract of insurance Regulation 5 is amended by revoking subclause (2) and sub- stituting the following subclauses: In subclause (1), pure risk contract of insurance means a contract of insurance— “(a) for the payment of money on the happening of a contin- gency not dependent on the continuance of human life; and 5 6 7 “(2) 2 2011/212 “(b) Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 r 6 that does not, and never will, have a value on its cancel- lation or surrender that is greater than the value of— “(i) an unexpired premium relating to a period after the date of cancellation or surrender; or the sum of the premiums paid to the insurer.
“(ii) “(3) Subclause (2)(b)(ii) is revoked on the close of 30 June 2016.” 6 New regulations 7A to 7C inserted The following regulations are inserted after regulation 7: “7A Public Trust term deposit is category 2 product For the purposes of paragraph (k) of the definition of category 2 product in section 5 of the Act, a fixed term deposit product offered by Public Trust is a category 2 product.
“7B Bank notice product is category 2 product “(1) For the purposes of paragraph (k) of the definition of category 2 product in section 5 of the Act, a bank notice product is a category 2 product.
In subclause (1), bank notice product means a debt security issued by a registered bank in New Zealand or a specified unit (as defined in regulation 4) under which— “(a) “(2) “(b) the security holder has the right to demand, at any time, repayment in full of the principal sum or withdrawal in full of the unit price or value of the units; and the issuer has an obligation to pay the amount demanded not later than any period (specified in the terms of issue) after the demand being made; and the rate of interest payable or any other benefit provided does not alter as a result of the demand being made; and “(d) no fee or other amount is payable as a result of the amount demanded not having been held by the issuer for a particular period of time.
“(c) “(3) Paragraphs (a) to (d) of subclause (2) may, in the case of a specified unit, be subject to the rights and requirements set out in paragraph (a)(i) to (viii) of the definition of PIE call fund unit in regulation 4(2) to the extent that they are described in the investment statement for the specified units.

“(4) This regulation is revoked on the close of 30 June 2016.
3 r 7 Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 2011/212 “7C Certain building society fixed term redeemable shares are category 2 products For the purposes of paragraph (k) of the definition of category 2 product in section 5 of the Act, a share issued by a building society that is a registered bank is a category 2 product if— “(a) it is redeemable in cash at the end of a fixed term or on the liquidation of the building society; and it bears a rate of dividend set on the issue of the share; and on liquidation of the building society, the former holder ranks ahead of all other classes of shareholders for the consideration payable on redemption.” “(b) “(c) 7 New regulation 12 added The following regulation is added: “12 Exemption for retirement village operators “(1) An operator of a retirement village is exempt from the appli- “(b) cation of the Act in respect of a service if— “(a) the retirement village is registered under the Retirement Villages Act 2003; and the service is provided in the ordinary course of busi- ness of an operator of a retirement village; and the service relates to acquiring or disposing of an occu- pation right agreement for that retirement village.
In this regulation, occupation right agreement, operator, and retirement village have the meanings set out in the Re- tirement Villages Act 2003.” “(c) Rebecca Kitteridge, Clerk of the Executive Council.

“(2) 4 2011/212 Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 Explanatory note Explanatory note This note is not part of the regulations, but is intended to indicate their general effect.
These regulations, which come into force on 1 July 2011, amend the Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Regulations 2011.

These regulations do the following things: • extend the existing definition of pure risk contracts of insur- ance.

These insurance contracts are classified as category 2 products under section 5 of the Financial Advisers Act 2008 by virtue of being excluded from being investment-linked con- tracts of insurance.
The extended definition allows pure risk contracts of insurance to provide for premium refunds.
The extended definition is limited initially to 5 years, providing an opportunity to review its operation: reclassify the following products as category 2 products under section 5 of the Financial Advisers Act 2008: • • fixed term deposit products offered by Public Trust: bank notice products (which are deposit products issued by a registered bank under which funds are on call, but subject to a minimum advance notice period).

These products may also be issued through a PIE structure.
This reclassification is limited initially to 5 years, pro- viding an opportunity to review its operation: building society redeemable shares (which are akin to term deposits) if the building society is also a registered bank: • provide a new exemption from the Financial Advisers Act 2008 for operators of registered retirement villages that pro- vide advice or other services in the ordinary course of their business relating to the acquiring or disposing of occupation right agreements for their retirement village.
This conduct is regulated under the Retirement Villages Act 2003.

The ex- emption extends (under section 14(1)(q) of the Financial Ad- visers Act 2008) to employees and other persons acting in the course of, and for the purposes of, the operator’s business.

5 • • Financial Advisers (Definitions, Voluntary Authorisation, Prescribed Entities, and Exemptions) Amendment Regulations 2011 2011/212 Issued under the authority of the Acts and Regulations Publication Act 1989.
Date of notification in Gazette: 23 June 2011.

These regulations are administered by the Ministry of Economic Development.

12 6 Wellington, New Zealand: Published under the authority of the New Zealand Government—2011