Dalziel Lianne: Securities Disclosure and Financial Advisers  Amendment Bill — First Reading 
Dalziel Lianne: Securities Disclosure and Financial Advisers  Amendment Bill — First Reading 
[Volume:652;Page:1547] 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 I begin my contribution to the debate on the first reading of the Securities Disclosure and Financial Advisers Amendment Bill by simply noting that I am very pleased it was not introduced under urgency. A number of bills were dealt with under urgency during the first 2 parliamentary weeks this year in order to meet the Government’s—what was it called? 
Moana Mackey 
: The 100 days of action. 
Hon LIANNE DALZIEL 
: Yes the action plan. But I do want to make this point seriously because tabling a bill and giving that 3 days’ time for scrutiny is always a preferable course of action when it can be achieved. Obviously because this bill will be referred to a select committee it was able to be achieved and I am very pleased that it could be done. I think this is particularly the case where we talk about securities law reform because confidence lies at the heart of everything that we do in respect of securities law. Therefore it is very important that we get the framework right when we make changes. I listened very carefully to the Minister of Commerce’s comments and as the chair of the Commerce Committee I will certainly undertake to ensure that full scrutiny is applied to this bill—as indeed I would with any bill. 
That being said Labour generally supports the bill. As the Minister said it is designed to provide for the use and regulation of a simplified disclosure prospectus by stock exchange - listed issuers offering certain debt and equity securities. In that regard it does not reduce the information required to be disclosed. In many respects it merely removes the duplication of information already provided pursuant to continuous disclosure obligations. Although the stock exchange has those obligations around continuous disclosure the information that needs to be provided in a prospectus is essentially provided anyway so this bill removes duplication. I guess that is why the Minister is able to say with reasonable confidence that the bill is designed to remove impediments to capital-raising without undermining investor protection. 
I think the Minister’s point though about why it is so important that close scrutiny is applied to this legislation is important because the substance of this particular reform lies within the Review of Financial Products and Providers and it was to be included in the current review of the Securities Act. I am certainly pleased to see that the Government is proceeding with that. In many respects this bill is simply bringing forward something that would have happened otherwise. 
We have already had a number of bills go through this House that have failed their regulatory impact statement requirements. So I will give praise to this Minister for having an excellent regulatory impact statement even though this brings forward something that has not been fully consulted on yet. I will give him 10 out of 10 for this regulatory impact statement. It will be a relief to Rodney Hide I would imagine to— 
Moana Mackey 
: Finally. 
Hon LIANNE DALZIEL 
:—finally have legislation introduced that meets the requirements of the framework that the previous Government put in place around regulatory impact statements. 
What I like about this regulatory impact statement is that it acknowledges that in fact this issue was part-way through a process of consultation because the Capital Market Development Taskforce had suggested a mechanism for bringing this forward in order to improve access to capital under the current conditions. I think that the way it has been presented in this report and undertaken in this consultation beyond that in a very short time frame has been excellent. I take my hat off to the people involved. 
According to the regulatory impact statement the Ministry of Economic Development consulted with a targeted group of industry experts in order to agree technical details to give proper effect to the policy and worked very closely with the Securities Commission in the development of the policy. Given the role of the commission in terms of oversight that it will pick up as a result of this legislation I think the right people have certainly been chosen to meet and discuss this bill. 
The other thing I will comment on is that officials have notified Australian authorities of the proposals in the context of the Agreement Between the Government of Australia and the Government of New Zealand in relation to Mutual Recognition of Securities Offerings. Again this is a vital piece of making the relationship between Australia and New Zealand work and that is to give advance warning of any changes that we make in our legislative framework. Having been the Minister who signed that agreement with the Australians I am very pleased that that has been picked up and that the notification has been made. I know that the Commerce Committee will want to know what the Australian Government’s response to the proposals in the legislation has been because how that mutual agreement works will be very dependent on the answer that is given. 
The other thing the regulatory impact statement does—and it is an excellent approach one that is required by the process that the previous Government put in place—is to set out the alternative options with option 1 being the status quo. That is not an option if we really do have a desire to bring down the barriers to capital-raising. The fact that the regulatory impact statement starts with the words “The world is currently in the midst of the worst financial crisis for many decades. The most immediate and pressing financial sector issue has been the breakdown in credit markets.” really does get to the nub of the problem. I think it is a little bit better than the Job Summit’s cycle track idea which is probably why it came from the Capital Market Development Taskforce. 
The next option was “listed issuers may offer securities with only an investment statement”. The third option was “listed issuers may use a term sheet for debt offerings”. The preferred option was “to provide for a new prospectus that may be issued by listed issuers of designated debt or equity securities who are subject to continuous disclosure requirements and to amend the provisions for exemptions from standard disclosure requirements.” 
As I say the regulatory impact statement does exactly what the regulatory impact process was designed to achieve. It alerts people to all of the options that are available. It critiques each one of them. Then it sets out a preferred path which is based on the information that has been collated from the consultation process. It really is a very good process. So I say 10 out of 10 to the Government for its regulatory impact statement. Given that it got nought out of 10 for all of its other bills this is a marked improvement and I hope to see all of the Government’s subsequent legislation meeting the very high standard that the Hon Simon Power has set for this House. The Labour Opposition will support the referral of the Securities Disclosure and Financial Advisers Amendment Bill to the Commerce Committee.