Securities Amendment Act 1996

1: Short Title and commencement
1: This Act may be cited as the Securities Amendment Act 1996, and shall be read together with and deemed part of the Securities Act 1978
2: Subject to subsections (3) (4)
3: Subject to subsection (4) subsection (2)
4: Sections 37 38
2: Transitional provision relating to application of this Act
Notwithstanding the commencement of this Act, an offer of securities (within the meaning of section 2D section 4
a: The principal Act as amended by this Act; or
b: The law in force immediately before the commencement of this Act,— and the principal Act as amended by this Act or the law in force immediately before the commencement of this Act, as the case may be, shall apply in respect of any offer so made.
3: Interpretation
1: Section 2(1) advertisement section 2(1) of the Securities Amendment Act 1982 section 13(1) of the Reserve Bank of New Zealand Amendment Act 1995 Advertisement section 2A of this Act .
2: Section 2(1) associated persons section YB 1 of the Income Tax Act 1994 Associated persons persons associated with each other
a: Persons who are relatives within the meaning of the Income Tax Act 1994
b: Persons who are partners to whom the Partnership Act 1908
c: Bodies corporate that consist substantially of the same members or shareholders or that are under the control of the same persons; or
d: A body corporate and a person who has the power, directly or indirectly, to exercise, or control the exercise of, the rights to vote attached to 25 percent or more of the voting securities of the body corporate; or
e: A body corporate and a person who is a director of the body corporate: .
3: Section 2(1) authorised advertisement section 38 or section 38AA
4: Section 2(1) authorised life insurance company section 42 Securities Amendment Act 1988 books and papers books or papers
5: Section 2(1) building society Bonus bond section 3(1) of the Finance Act (No 2) 1990 .
6: Section 2(1) debt security section 2(6) of the Securities Amendment Act 1982 Debt security
a: A debenture, debenture stock, bond, note, certificate of deposit, and convertible note; and
b: An interest or right that is declared by regulations to be a debt security for the purposes of this Act; and
c: A renewal or variation of the terms or conditions of any such interest or right or of a security referred to in paragraph (a) or paragraph (b) of this definition but does not include—
d: An interest in a contributory mortgage where the interest is offered by a contributory mortgage broker; or
e: Any such interest or right or a security referred to in paragraph (a) or paragraph (c) of this definition .
7: Section 2(1) distribute Distribute
a: Make available, publish, and circulate; and
b: Communicate by letter, newspaper, broadcasting, sound recording, television, cinematographic film, video, or any form of electronic or other means of communication: Document
a: Any writing on or in any material; and
b: Information recorded or stored by means of a tape-recorder, computer, or other device; and material subsequently derived from information so recorded or stored; and
c: A record, book, graph, or drawing; and
d: A photograph, film, negative, tape, disk, or other device in which one or more visual images are embodied or stored so as to be capable (with or without the aid of equipment) of being reproduced: .
8: Section 2(1) equity security Equity security
a: A preference share, and company stock; and
b: A security that is declared by regulations to be an equity security for the purposes of this Act; and
c: A renewal or variation of the terms or conditions of any such interest or right or a security referred to in paragraph (a) or paragraph (b) of this definition but does not include any such interest or right or a security referred to in paragraph (a) or paragraph (c) of this definition .
9: Section 2(1) Government department Interest in a superannuation scheme
a: Any interest or right that is declared by regulations to be an interest in a superannuation scheme for the purposes of this Act; and
b: Any renewal or variation of the terms or conditions of any such interest or right or a security referred to in paragraph (a) of this definition but does not include any such interest or right, or a security referred to in paragraph (b) of this definition Investment statement section 38C of this Act .
10: Section 2(1) issuer section 2(8) of the Securities Amendment Act 1982 Issuer
a: In relation to an equity security or a debt security, or to an advertisement, investment statement, prospectus, or registered prospectus that relates to an equity security or a debt security, or to a trust deed that relates to a debt security, the person on whose behalf any money paid in consideration of the allotment of the security is received:
b: In relation to a participatory security, or to an advertisement, investment statement, prospectus, or registered prospectus, or to a deed of participation that relates to a participatory security, the manager:
c: In relation to an interest in a contributory mortgage offered by a contributory mortgage broker, or to an advertisement that relates to such an interest, the contributory mortgage broker:
d: In relation to a unit in a unit trust, or to an advertisement, investment statement, prospectus, or registered prospectus that relates to such a unit, the manager:
e: In relation to a life insurance policy, or to an advertisement, investment statement, prospectus, or registered prospectus that relates to a life insurance policy, the life insurance company that is liable under the policy:
f: In relation to an interest in a superannuation scheme, or to an advertisement, investment statement, prospectus, or registered prospectus that relates to such an interest, the superannuation trustee of the scheme: .
11: Section 2(1) life insurance policy section 42 Securities Amendment Act 1988 Life insurance policy
a: A policy of insurance that is declared by regulations to be a life insurance policy for the purposes of this Act; and
b: A renewal or variation of the terms or conditions of any such policy or a security referred to in paragraph (a) of this definition but does not include any such policy, or a security referred to in paragraph (b) of this definition .
12: Section 2(1) manager Manager
a: In relation to a participatory security, means the person or persons acting in the promotion or management of the arrangement or scheme to which the security relates; and
b: In relation to a unit in a unit trust, has the same meaning as in section 2(1) of the Unit Trusts Act 1960 .
13: Section 2(1) participatory security Participatory security
a: An equity security; or
b: A debt security; or
c: A unit in a unit trust; or
d: An interest in a superannuation scheme; or
e: A life insurance policy: .
14: Section 2(1) promoter Prospective investor .
15: Section 2(1) qualified auditor Qualified auditor section 2C of this Act Receive .
16: Section 2(1) Registrar Regulations section 70 of this Act .
17: Section 2(1) relative Scheme
a: In relation to a participatory security, the arrangement or scheme to which the security relates; and
b: In relation to an interest in a superannuation scheme, that superannuation scheme; and
c: In relation to a unit in a unit trust, that unit trust: .
18: Section 2(1) security Security section 2D of this Act .
19: Section 2(1) security holder Send .
20: Section 2(1) subscribe Superannuation scheme section 2(1) of the Superannuation Schemes Act 1989 Superannuation trustee trustees Superannuation Schemes Act 1989 Trust deed section 33(2)(a) of this Act .
21: Section 2(1) Unit
a: Any interest or right that is declared by regulations to be a unit for the purposes of this Act; and
b: Any renewal or variation of the terms or conditions of any such interest or right;— but does not include any such interest or right or a security referred to in paragraph (b) of this definition Unit trust section 2(1) of the Unit Trusts Act 1960 Unit trustee trustee section 2(1) of the Unit Trusts Act 1960 Working day
a: Saturday, Sunday, Good Friday, Easter Monday, Anzac Day, the Sovereign's Birthday, Labour Day, and Waitangi Day; and
b: A day in the period commencing with the 25th day of December in any year and ending with the 2nd day of January in the following year; and
c: If the 1st day of January in any year falls on a Friday, the following Monday; and
d: If the 1st day of January in any year falls on a Saturday or a Sunday, the following Monday and Tuesday: Writing
a: The recording of words in a permanent and legible form; and
b: The display of words by any form of electronic or other means of communication in a manner that enables the words to be readily stored in a permanent form and, with or without the aid of any equipment, to be retrieved and read;— and written
22: Section 2 subsection (2)
23: The following enactments are hereby consequentially repealed:
a: Subsections (1), (6), and (8) of section 2 of the Securities Amendment Act 1982
b: Section 42 Securities Amendment Act 1988
c: Section 13(1) of the Reserve Bank of New Zealand Amendment Act 1995
4: New sections inserted
The principal Act is hereby amended by inserting, after section 2
2A: Meaning of
advertisement
1: In this Act, unless the context otherwise requires, advertisement
a: That—
i: Contains or refers to an offer of securities to the public for subscription; or
ii: Is reasonably likely to induce persons to subscribe for securities of an issuer, being securities to which the communication relates and that have been, or are to be, offered to the public for subscription; and
b: That is authorised or instigated by, or on behalf of, the issuer of the securities or prepared with the co-operation of, or by arrangement with, the issuer of the securities; and
c: That is to be, or has been, distributed to a person.
2: The following are also advertisements:
a: A statement relating to an interest in a contributory mortgage required to be distributed to a person by regulations:
b: An investment statement.
3: None of the following is an advertisement:
a: A registered prospectus:
b: A statement made in accordance with section 3(6) of this Act
c: A statement or report made in accordance with section 3(7) of this Act
d: A disclosure statement published by a registered bank under section 81 of the Reserve Bank of New Zealand Act 1989
4: A communication is an advertisement whether or not consideration is to be, or has been, paid for the distribution of the communication.
5: The definition of the term advertisement advertisement section 3(1)(c) of this Act
6: Where—
a: An advertisement within the meaning of this section appears in association with another advertisement that is not an advertisement within the meaning of this section; and
b: Both advertisements are authorised or instigated by, or on behalf of, the same person or prepared with the co-operation of, or by arrangement with, the same person,— those advertisements are deemed to be a single advertisement within the meaning of this section.
7: Unless this Act or regulations provide otherwise, nothing in this Act or regulations limits the information, statements, and other matters that may be contained in an advertisement.
2B: Meaning of
due enquiry
1: For the purposes of this Act, a person who is required to make due enquiry about a matter does not fail to do so if—
a: He or she receives information or advice about the matter from another person whom he or she believes on reasonable grounds is reliable and competent; and
b: The information or advice received—
i: Is of the same kind and standard as that which it would be reasonable to expect to be supplied in the ordinary course of management of businesses of the same kind to persons in the same kind of position; and
ii: Does not state or indicate that further information, advice, or investigation is or may be required; and
c: He or she has no reason to believe that the information or advice is or may be incorrect.
2: Nothing in subsection (1) of this section
2C: Meaning of
qualified auditor
1: For the purposes of this Act, a person is a qualified auditor only if—
a: The person is a chartered accountant (within the meaning of section 19 of the Institute of Chartered Accountants of New Zealand Act 1996
b: The person is an officer of the Audit Department authorised in writing by the Controller and Auditor-General to be an auditor for the purposes of this Act; or
c: The person is a member, fellow, or associate of an association of accountants constituted outside New Zealand where—
i: The association is, by notice in the Gazette
ii: The person is entitled to act as an auditor in the country, state, or territory in which the association is constituted; or
d: The person, not being a person referred to in paragraph (c) of this subsection
i: Entitled to act as an auditor in a country, state, or territory outside New Zealand; and
ii: Approved for the time being for the purposes of this Act by the Registrar by notice in the Gazette
2: None of the following persons is qualified for appointment as an auditor of the accounting or other records of an issuer of securities:
a: The issuer, or a principal officer, officer, or employee of the issuer:
b: A person who is a partner of or in the employment of a person specified in paragraph (a) of this subsection
c: A body corporate.
3: A person is not qualified for appointment as auditor of an issuer of securities if the person is, by virtue of subsection (2) of this section
2D: Meaning of
security
1: In this Act, unless the context otherwise requires, the term security
a: An equity security; and
b: A debt security; and
c: A unit in a unit trust; and
d: An interest in a superannuation scheme; and
e: A life insurance policy; and
f: Any interest or right that is declared by regulations to be a security for the purposes of this Act; and
g: Any renewal or variation of the terms or conditions of any such interest or right;— but does not include any such interest or right (other than a security referred to in paragraph (f) of this subsection
2: Where the terms of a security require or allow the subscriber to pay separate amounts of money at different times, each such payment shall, for the purposes of this Act, be treated as payment for the same security as each other payment.
5: Application of this Act
1: Section 4(3) trustee , superannuation trustee, unit trustee,
2: Section 4
4: Nothing in this section or in any other provision of this Act limits the Illegal Contracts Act 1970
6: Exemptions from this Act
1: Section 5 subsections (2) (2A) section 181(1) Reserve Bank of New Zealand Act 1989
2: Section 5 subsection (2B) section 181(4) Reserve Bank of New Zealand Act 1989
3: Section 5 subsection (2C) section 181(8) Reserve Bank of New Zealand Act 1989
2C: Nothing in sections 33(2), 37, 37A(1)(c) and (d), 39 to 44, 45 to 52, 54, and 54B(3) of this Act
2D: Nothing in sections 37A(1)(a) and 38C to 38F of this Act
a: An interest in a call debt security as defined in regulations made under this Act; or
b: An interest in a call building society share as defined in regulations made under this Act; or
c: An interest in a bonus bond.
2E: Nothing in sections 37, 37A(1)(c), and 39 to 44 of this Act
2F: Subsection (2E) of this section
4: Section 5(3) section 5(4) of the Securities Amendment Act 1982 37A 37A(1)(c) and (d) and (2)
5: Section 5(4) section 5(5) of the Securities Amendment Act 1982 37A, 38C to 38F,
6: Subsections (1) (3) (4) (5) (7) to (9) Reserve Bank of New Zealand Act 1989
7: Previously allotted securities
1: Section 6(1) section 2(1) of the Securities Amendment Act 1993 37 to 44 37 to 38A, 38C to 44
2: Section 6 subsection (2)
2A: All the provisions of this Act shall apply in respect of a unit in a unit trust that has previously been allotted (whether in New Zealand or elsewhere) and that is being offered, sold, or otherwise disposed of to the public for subscription by the manager or unit trustee of the unit trust or by an associated person of that manager or unit trustee.
3: Section 6(7) or subsection (2A)
8: Term implied in certain offers of previously allotted securities
1: Section 6A(1)(a) section 2 of the Securities Amendment Act 1994 37 to 44 37 to 38A, 38C to 44
2: Section 6A(1)(b) subsection (2) or subsection (3) any of subsections (2), (2A), or (3)
9: Exemption for authorised life insurance companies
1: The principal Act is hereby amended by repealing sections 7A 7B section 44 Securities Amendment Act 1988
2: Section 44 Securities Amendment Act 1988
10: Appeals to High Court on questions of law
Section 26 subsections (3) (4) (7) 14 10 working
11: Restrictions on offer of securities to the public
1: Section 33 subsection (1) section 13 of the Securities Amendment Act 1982
1: No security shall be offered to the public for subscription, by or on behalf of an issuer, unless—
a: The offer is made in, or accompanied by, an authorised advertisement that is an investment statement that complies with this Act and regulations; or
b: The offer is made in an authorised advertisement that is not an investment statement; or
c: The offer is made in, or accompanied by, a registered prospectus that complies with this Act and regulations.
2: Section 13 of the Securities Amendment Act 1982
12: Restrictions on distribution of prospectuses
Section 34 section 14 of the Securities Amendment Act 1982
2: A registered prospectus shall not be distributed by or on behalf of an issuer unless it is accompanied by,—
a: If the registered prospectus refers to, but does not contain, financial statements registered under the Financial Reporting Act 1993
b: A copy of any documents registered under this Act for the purpose of extending the period during which allotments may be made under the registered prospectus.
13: Restrictions on door-to-door sales
Section 35 subsection (3)
3: In this section, the term securities
14: Void irregular allotments
1: Section 37(2) section 15 of the Securities Amendment Act 1982 participatory security or a unit in a unit trust
2: Section 37(3) holds a written statement signed by has received a written statement from
15: Voidable irregular allotments
1: Section 37A section 16 of the Securities Amendment Act 1982 subsection (1)
1: No allotment of a security offered to the public for subscription shall be made if—
a: The subscriber did not receive any investment statement relating to the security before subscribing for the security; or
b: At the time of allotment, any investment statement or registered prospectus relating to the security is known by the issuer of the security, or any director of the issuer, to be false or misleading in a material particular by reason of failing to refer, or give proper emphasis, to adverse circumstances (whether or not the investment statement or registered prospectus became so false or misleading as a result of a change of circumstances occurring after the date of the investment statement or registered prospectus); or
c: The date of allotment would be more than,—
i: Where the registered prospectus relating to the security contains or refers to a balance sheet or interim balance sheet in accordance with regulations and no certificate has been registered in relation to that prospectus under subsection (1A) of this section, 9 months after the date of that balance sheet or interim balance sheet (whichever is the later); or
ii: Where the registered prospectus relating to the security contains or refers to a balance sheet (but not an interim balance sheet) in accordance with regulations and a certificate has been registered in relation to that prospectus under subsection (1A) of this section
iii: In any other case, 6 months after the date of the registered prospectus; or
d: In the case of an equity security, debt security, or participatory security, after the allotment, the total amount of securities allotted under the registered prospectus relating to the security would (after deducting, in the case of an allotment of debt securities, the total amount of debt securities of the issuer redeemed since the date of the registered prospectus) exceed the amount specified in the registered prospectus as the maximum amount that will be so allotted.
1A: For the purposes of subsection (1)(c) of this section
a: Is signed on behalf of all the directors by at least 2 directors of the issuer (or, where the issuer has only 1 director, by that director); and
b: Is dated no later than 9 months after the date of the balance sheet contained or referred to in the registered prospectus; and
c: States that, in the opinion of all directors of the issuer after due enquiry by them,—
i: The financial position shown in the balance sheet referred to in paragraph (b) of this subsection
ii: The registered prospectus is not, at the date of the certificate, false or misleading in a material particular by reason of failing to refer, or give proper emphasis, to adverse circumstances; and
d: Where the registered prospectus relates to equity securities, debt securities, or participatory securities, is accompanied by financial statements—
i: For the 6-month period from the date of the balance sheet referred to in paragraph (b) of this subsection
ii: Prepared in accordance with regulations as if they were required to be contained or referred to in a registered prospectus for those securities, except that they need not be audited.
2: Section 37A(3) wound up in liquidation
16: Meaning of
authorised advertisement
1: The principal Act is hereby amended by repealing section 38 section 17(1) of the Securities Amendment Act 1982 section 181(10) Reserve Bank of New Zealand Act 1989 Advertisements
38: Meaning of
authorised advertisement In this Act, the term authorised advertisement
a: In relation to an offer of securities to the public in respect of which an investment statement is required, an advertisement—
i: That is an investment statement that relates to the securities and that complies with this Act and regulations; or
ii: That refers to an investment statement that relates to the securities referred to in the advertisement and that complies with this Act and regulations:
b: In any other case, an advertisement that complies with this Act and regulations.
2: The following enactments are hereby consequentially repealed:
a: Section 17 of the Securities Amendment Act 1982
b: Section 181(10) Reserve Bank of New Zealand Act 1989
17: New sections inserted
The principal Act is hereby amended by inserting, after section 38A
38B: Prohibition of advertisements
1: Where, at any time, the Commission is of the opinion that an advertisement—
a: Is likely to deceive, mislead, or confuse with regard to any particular that is material to the offer of securities to which it relates; or
b: Is inconsistent with any registered prospectus referred to in it; or
c: Does not comply with this Act and regulations,— the Commission may make an order prohibiting the distribution of that advertisement or any advertisement which relates to the offer of securities.
2: Without limiting subsection (1) of this section section 81 of the Reserve Bank of New Zealand Act 1989
3: An order may be made on such terms and conditions as the Commission thinks fit.
4: Where the Commission makes an order under this section,—
a: It shall forthwith notify the issuer of the securities that the order has been made and the reasons for making it; and
b: It may notify any other person that the order has been made and the reasons for making it.
5: Every person who contravenes an order made under this section commits an offence and is liable on summary conviction to a fine not exceeding $5,000.
6: It is a defence to a charge under subsection (5) of this section
a: Without the defendant's knowledge; or
b: Without the defendant's knowledge of the order.
7: At any time after an order has been made under this section, the issuer of the securities to which the advertisement relates shall be entitled to appear and be represented before the Commission.
8: The Commission, if it is satisfied that the order should not continue in force, may revoke the order.
9: In this section, the term advertisement Investment statements
38C: Meaning of
investment statement In this Act, the term investment statement
a: Contains or refers to one or more offers of securities to the public for subscription; and
b: States that it is an investment statement for the purposes of this Act.
38D: Purpose of investment statement
The purpose of an investment statement is to—
a: Provide certain key information that is likely to assist a prudent but non-expert person to decide whether or not to subscribe for securities; and
b: Bring to the attention of such a person the fact that other important information about the securities is available to that person in other documents.
38E: Form and content of investment statement
1: Every investment statement shall—
a: Be in writing; and
b: State, in a prominent place, the date as at which the investment statement is prepared; and
c: Where a registered prospectus is required in respect of the securities referred to in the investment statement, refer to that registered prospectus and state the date of its registration; and
d: Contain all information, statements, and other matters that it is required to contain by regulations.
2: An investment statement may relate to any or all of the following:
a: One or more kinds of securities:
b: One or more offers of or subscriptions for securities of a particular kind.
3: Unless this Act or regulations provide otherwise, nothing in this Act or in regulations limits the information, statements, or other matters that may be contained in an investment statement.
38F: Suspension and prohibition of investment statement
1: Where, at any time, the Commission is of the opinion that an investment statement—
a: Is likely to deceive, mislead, or confuse with regard to any particular that is material to the offer of securities to which it relates; or
b: Is inconsistent with any registered prospectus referred to in it; or
c: Does not comply with this Act and regulations,— the Commission may exercise either or both of the following powers in respect of the investment statement:
d: If it considers that suspension of the investment statement is desirable in the public interest, the Commission may make an order suspending the investment statement for a period not exceeding 14 days:
e: After giving the issuer of the investment statement not less than 7 days' written notice of the meeting at which the matter will be considered by the Commission, the Commission may, at that meeting, make an order prohibiting the distribution of the investment statement.
2: An order may be made on such terms and conditions as the Commission thinks fit.
3: Where the Commission suspends an investment statement pursuant to this section,—
a: It shall forthwith notify the issuer of the suspension and the reasons for it; and
b: None of the following persons shall, except for the purposes of paragraph (a) of this subsection
i: A member of the Commission or an officer or employee of the Commission:
ii: A person appointed under section 21 of this Act
4: Subject to subsection (6) of this section
a: No allotment shall be made of any securities subscribed for whether before or after the suspension order is made:
b: All subscriptions received for such securities, not being subscriptions for securities which have been allotted before the suspension, shall be held in trust for the subscribers.
5: The Commission, if it is satisfied that the suspension of an investment statement should not continue in force, may revoke the suspension.
6: Subsection (4) of this section
i: The Commission revokes the suspension of an investment statement; or
ii: The period of suspension of an investment statement expires and the distribution of the investment statement has not been prohibited under this section.
7: Where the Commission revokes the suspension of an investment statement pursuant to this section,—
a: It shall forthwith notify the issuer of the revocation of the suspension; and
b: None of the following persons shall, except for the purposes of paragraph (a) of this subsection
i: A member of the Commission or an officer or employee of the Commission:
ii: A person appointed under section 21 of this Act
8: Where the Commission prohibits the distribution of an investment statement pursuant to this section,—
a: It shall forthwith notify the issuer of the prohibition and the reasons for it; and
b: It may notify any other person of the prohibition and the reasons for it.
9: Subject to subsection (11) of this section
a: No allotment shall be made of any securities subscribed for whether before or after the prohibition order is made:
b: All subscriptions held in trust pursuant to subsection (4)(b) of this section
c: All subscriptions received for securities pursuant to the investment statement, not being subscriptions for securities which have been allotted before the prohibition order was made and not being subscriptions required to be held in trust for the subscribers pursuant to subsection (4)(b) of this section
10: The Commission, if it is satisfied that the prohibition of the distribution of an investment statement should not continue in force, may revoke the prohibition.
11: Subsection (9) of this section
12: Where the Commission revokes the prohibition of the distribution of an investment statement pursuant to this section, it shall forthwith notify the issuer of the revocation of the prohibition.
13: Subject to subsection (14) of this section
14: A director of an issuer shall not be liable to repay any subscriptions and interest pursuant to subsection (13) of this section
18: Form and content of prospectus
Section 39 section 19 of the Securities Amendment Act 1982
2: A prospectus or registered prospectus may form part of, or be combined with, any annual report or other document that is required by any enactment; and, in any such case, the provisions of this Act and of all regulations made under this Act shall apply to that annual report or other document.
3: Unless this Act or regulations provide otherwise, nothing in this Act or in regulations made under this Act limits the information, statements, certificates, or other matters that may be contained in a prospectus or registered prospectus.
19: Suspension and cancellation of registration of registered prospectus
1: Section 44 section 11 Securities Amendment Act 1986 subsection (2)
2: Where the Commission suspends the registration of a registered prospectus pursuant to this section,—
a: It shall forthwith notify the issuer named in the prospectus of the suspension and the reasons for it; and
b: It may notify the Registrar of the suspension and the reasons for it; and
c: None of the following persons shall, except for the purposes of paragraph (a) or paragraph (b) of this subsection
i: A member of the Commission or an officer or employee of the Commission:
ii: A person appointed under section 21 of this Act
iii: The Registrar.
2: Section 44(3) subsection (4) subsection (4A)
3: Section 44 subsection (4)
4: The Commission, if it is satisfied that the suspension of the registration of a registered prospectus should not continue in force, may revoke the suspension.
4A: Subsection (3) of this section
i: The Commission revokes the suspension of registration of a registered prospectus; or
ii: The period of suspension of registration of a registered prospectus expires and the registration of that registered prospectus is not cancelled under this section.
4B: Where the Commission revokes the suspension of the registration of a registered prospectus pursuant to this section,—
a: It shall forthwith notify the issuer named in the prospectus of the revocation of the suspension; and
b: It may notify the Registrar of the revocation of the suspension; and
c: None of the following persons shall, except for the purposes of paragraph (a) or paragraph (b) of this subsection
i: A member of the Commission or an officer or employee of the Commission:
ii: A person appointed under section 21 of this Act
iii: The Registrar.
4: Section 44(6)(b) on in
5: Section 44(7) the rate of 10 percent per annum a rate prescribed from time to time by regulations made under this Act
20: Prohibition of advertisements
1: Section 44A section 49 Securities Amendment Act 1988 section 13(5) of the Reserve Bank of New Zealand Amendment Act 1995
2: The following enactments are hereby consequentially repealed:
a: Section 49 Securities Amendment Act 1988
b: Section 13(5) of the Reserve Bank of New Zealand Amendment Act 1995
21: New heading inserted
The principal Act is hereby amended by inserting, after section 44 Contributory Mortgages
22: Powers and duties of persons appointed to act as broker
Section 44C(4) section 24 of the Securities Amendment Act 1982 books or records or
23: Powers and duties of persons appointed to act as directors or secretary of nominee company
Section 44D(2) section 24 of the Securities Amendment Act 1982 books, records, or
24: New sections substituted
The principal Act is hereby amended by repealing section 50 51 52 section 2 Company Law Reform (Transitional Provisions) Act 1994 section 53 section 25 of the Securities Amendment Act 1982 section 2 Company Law Reform (Transitional Provisions) Act 1994 Duties of auditors
50: Duty of auditor to report to trustee or statutory supervisor
1: Whenever the auditor of an issuer of debt securities or participatory securities offered to the public (being securities that are held by members of the public) furnishes to the issuer or its members or shareholders or the security holders any report, financial statements, certificate, or other document that is required by any Act or by any deed relating to the securities to be so furnished, the auditor shall forthwith send a copy to the trustee or statutory supervisor of the securities.
2: Whenever, in the performance of the auditor's duties, the auditor of an issuer of debt securities or participatory securities offered to the public (being securities that are held by members of the public) becomes aware of any matter that, in the auditor's opinion, is relevant to the exercise or performance of the powers or duties of the trustee or statutory supervisor of the securities, the auditor shall, within 7 working days of becoming aware of the matter, send—
a: To the issuer, a report in writing on the matter; and
b: To the trustee or statutory supervisor, as the case may be, a copy of that report.
3: The auditor of an issuer of debt securities or participatory securities offered to the public (being securities that are held by members of the public) shall from time to time, at the request of the trustee or statutory supervisor, furnish to the trustee or statutory supervisor such information or particulars relating to the issuer as are requested and are within the auditor's knowledge and are, in the auditor's opinion, relevant to the exercise or performance of the powers or duties of the trustee or statutory supervisor.
4: Nothing in this section affects the duties or liability of a trustee or statutory supervisor.
50A: Duty of auditor to report to unit trustee
1: Whenever the auditor of an issuer of units in a unit trust furnishes to the issuer any report, financial statements, certificate, or other documents required by any Act or any trust deed relating to the unit trust, the auditor shall forthwith send a copy to the unit trustee.
2: Whenever, in the performance of the auditor's duties, the auditor of a unit trust that has units held by members of the public becomes aware of any matter that, in the auditor's opinion, is relevant to the exercise or performance of the powers or duties of the unit trustee, the auditor shall, within 7 working days of becoming aware of the matter, send—
a: To the issuer of the units, a report in writing on the matter; and
b: To the unit trustee, a copy of that report.
3: The auditor of an issuer of units in a unit trust that has units held by members of the public shall from time to time, at the request of the unit trustee, furnish to the unit trustee such information or particulars relating to the issuer as are requested and are within the auditor's knowledge and are, in the auditor's opinion, relevant to the exercise or performance of the powers or duties of the unit trustee.
4: Nothing in this section affects the duties or liability of an issuer of units in a unit trust or a unit trustee. Obligations of issuers
51: Issuers to keep registers of securities
1: Every issuer of securities offered to the public shall keep in New Zealand—
a: A register of all equity securities; and
b: Where the issuer is a company, a register of all debentures, debenture stock, bonds, notes, certificates of deposit, and convertible notes; and
c: A register of all participatory securities; and
d: A register of all units in unit trusts; and
e: A register of all interests in superannuation schemes; and
f: A register of all life insurance policies— of which it is the issuer.
2: Every register kept for the purposes of this section shall contain, in respect of every security entered in it,—
a: The name and address of the holder; and
b: The date on which the security was allotted or transferred to the holder, as the case may be; and
c: The nature of the security; and
d: The amount of the security (if any); and
e: The due date of the security (if any); and
f: Such other particulars as are required to be entered in the register by regulations.
3: Nothing in paragraphs (a) and (b) of subsection (2) of this section
4: No notice of any trust, expressed, implied, or constructive, shall be entered on a register kept under any of paragraphs (a) to (c), and (f) of subsection (1) of this section
5: Every register kept under this section is prima facie evidence of the matters required by this Act to be entered in it.
6: Every issuer of securities offered to the public (other than securities that have been redeemed) shall ensure that every register kept by it under this section is audited at least once a year by a qualified auditor.
7: Nothing in subsection (6) of this section section 13(2) of the Superannuation Schemes Act 1989
8: If the auditor considers at any time that this section is not being complied with, the auditor shall forthwith advise the issuer and,—
a: In the case of equity securities, the security holders at their next meeting:
b: In the case of debt securities, the trustee:
c: In the case of participatory securities, the statutory supervisor:
d: In the case of units in a unit trust, the unit trustee.
9: Every issuer shall send a notice to the Registrar of the place where its registers are kept and of any change in that place.
10: Subsection (9) of this section
11: Nothing in this section derogates from the Life Insurance Act 1908 Companies Act 1955 Companies Act 1993
52: Rights of inspection of registers of securities and to copies of registers and deeds
1: The registers kept under paragraphs (a) to (d) of section 51(1) of this Act
2: The registers kept under paragraphs (e) and (f) of section 51(1) of this Act
3: Any person may require a copy of a register kept under paragraphs (a) to (d) of section 51(1) of this Act
4: A holder of securities may require a copy of that part of a register kept under paragraph (e) or paragraph (f) of section 51(1) of this Act
5: For the purposes of this section, a register shall be deemed to be duly closed if closed in accordance with provisions contained in the rules of the issuer or in the securities or any trust deed or deed of participation relating to the securities, during a period or periods not exceeding in aggregate 30 days in any year.
6: Nothing in this section derogates from the Life Insurance Act 1908 Companies Act 1955 Companies Act 1993
53: Issuers to keep proper accounting records
1: Every issuer of securities offered to the public (other than securities that have been redeemed) shall ensure that there are kept at all times accounting records that—
a: Correctly record and explain the transactions,—
i: In the case of an issuer of equity securities, debt securities, or life insurance policies, of the issuer; and
ii: In the case of an issuer of participatory securities, units in a unit trust, or interests in a superannuation scheme, of the scheme; and
b: Will at any time enable the financial position of the issuer or scheme, as the case may be, to be determined with reasonable accuracy; and
c: Will enable the issuer to ensure that the financial statements of the issuer or scheme, as the case may be, comply with the Financial Reporting Act 1993
d: Will enable the financial statements of the issuer or scheme, as the case may be, to be readily and properly audited.
2: The accounting records referred to in subsection (1) of this section
3: Without limiting subsection (1) of this section
a: Entries of money received and spent each day and the matters to which those entries relate:
b: A record of the assets and liabilities of the issuer or scheme:
c: If the business of the issuer or scheme involves dealing in goods,—
i: A record of goods bought or sold, except goods sold for cash in the ordinary course of carrying on a retail business, that identifies the goods and buyers and sellers and relevant invoices; and
ii: A record of stock held at the end of the financial year together with records of any stocktakings during the year:
d: If the business of the issuer or scheme involves providing services, a record of services provided and relevant invoices.
53A: Place where accounting records to be kept
1: Subject to subsection (2) of this section section 53 of this Act
2: The accounting records may be kept at a place outside New Zealand only if there is sent to, and kept at a place in, New Zealand such documents in respect of the business dealt with in those accounting records as will disclose with reasonable accuracy the financial position of that business at intervals not exceeding 6 months and will enable to be prepared the financial statements of the issuer or scheme, and any document annexed to any of those documents giving information that is required by any enactment.
53B: Accounting records to be in English
Accounting records required by section 53 of this Act section 53A of this Act
53C: Period for which accounting records to be kept
1: Accounting records kept under section 53A of this Act
2: Nothing in subsection (1) of this section
53D: Inspection of accounting records
Every issuer shall make the accounting records required to be kept under section 53 of this Act section 53A of this Act
53E: Financial statements to be audited
1: Every issuer of equity securities or debt securities or life insurance policies offered to the public (other than securities that have been redeemed) shall ensure that its financial statements are audited at least once a year by a qualified auditor.
2: Every issuer of participatory securities offered to the public shall ensure that, if the statutory supervisor so requires, the financial statements relating to the arrangement or scheme to which the securities relate are audited at least once a year by a qualified auditor.
3: Every issuer of units in a unit trust or interests in a superannuation scheme offered to the public shall ensure that the financial statements relating to the unit trust or superannuation scheme, as the case may be, are audited at least once a year by a qualified auditor.
4: Nothing in subsection (3) of this section section 13(2) of the Superannuation Schemes Act 1989
53F: Application of other Acts not affected
Nothing in sections 53 to 53E of this Act Companies Act 1955 Companies Act 1993
25: Consequential repeals
The following enactments are hereby consequentially repealed:
a: Section 25 of the Securities Amendment Act 1982
b: So much of Schedule 1 Company Law Reform (Transitional Provisions) Act 1994 sections 51 to 53
26: Issuers to issue certificates evidencing securities
Section 54(1) a security an equity security, a debt security, a unit, or a participatory security
27: New sections inserted
The principal Act is hereby amended by inserting, after section 54
54A: Information to be sent periodically to security holders
Every issuer of securities offered to the public for subscription shall send, or cause to be sent, to each security holder, at the times prescribed by regulations, the documents, information, and other matters required to be sent by those regulations.
54B: Information to be disclosed by issuers on request
1: Every issuer of securities offered to the public shall, at the request of a security holder and on payment of any prescribed fee, send, or cause to be sent, to the security holder such documents, information, and other matters of a kind prescribed by regulations as are requested by the security holder.
2: The documents, information, and other matters must be sent to the security holder as soon as practicable but, in any event, within 5 working days of the issuer receiving the request.
3: Every issuer of securities offered to the public shall, upon the request of a security holder or a prospective investor for a copy of the registered prospectus relating to the securities, without fee, send, or cause to be sent, to that security holder or prospective investor,—
a: A copy of that registered prospectus; and
b: A copy of any financial statements of the issuer or scheme concerned that have been registered under the Financial Reporting Act 1993
c: A copy of any documents registered under this Act for the purpose of extending the period during which allotments may be made under the registered prospectus.
4: The documents referred to in subsection (3) of this section
28: Interpretation of provisions relating to advertisements, prospectuses, and registered prospectuses
1: The principal Act is hereby amended by repealing section 55 section 26 of the Securities Amendment Act 1982
55: For the purposes of this Act,—
a: A statement included in an advertisement or registered prospectus is deemed to be untrue if—
i: It is misleading in the form and context in which it is included; or
ii: It is misleading by reason of the omission of a particular which is material to the statement in the form and context in which it is included:
b: A statement is deemed to be included in an advertisement or registered prospectus if it is—
i: Contained in the advertisement or registered prospectus; or
ii: Appears on the face of the advertisement or registered prospectus; or
iii: Contained in any financial statements, report, memorandum, or document that accompany, or are incorporated by reference or referred to in, or distributed with, the advertisement or registered prospectus:
c: A certificate registered under section 37A(1A) of this Act
2: Section 26 of the Securities Amendment Act 1982
29: Civil liability for misstatements in advertisement or registered prospectus
Section 56(3) section 27 of the Securities Amendment Act 1982 supervisor or unit trustee
30: Civil liability for misstatements by expert
Section 57(2)(b) section 28 of the Securities Amendment Act 1982 supervisor or unit trustee
31: Other offences
Section 60(2) section 32 of the Securities Amendment Act 1982 and 53 53 to 53E, 54A, and 54B
32: Liability of officers and auditors of issuer
Section 61 association or constitution
33: Registrar's powers of inspection
1: Section 67(1) paragraphs (a) (b)
a: Require any issuer or promoter of securities offered to the public or any investment adviser or investment broker (within the meaning of the Investment Advisers (Disclosure) Act 1996
b: Require any person to produce for inspection any document that contains information relating to any money or other property that is managed, supervised, controlled, or held in trust by any such issuer, promoter, investment adviser, or investment broker; .
2: Paragraphs (c) (d) book or paper or other
34: Appeals against Registrar's powers of inspection
Section 68(1) 21 15 working
35: Appeals against other decisions of Registrar
Section 69(1) section 34 of the Securities Amendment Act 1982 section 25(1) Official Information Amendment Act 1987 21 15 working
36: Appeals from decisions under
section 67A Section 69A(1) section 25(1) Official Information Amendment Act 1987 21 15 working
37: Regulations and Orders in Council
1: Section 70(1)(b) section 35 of the Securities Amendment Act 1982 advertisements, investment statements,
2: Section 70(1)(b)(iii) advertisement, investment statement,
3: Section 70(1)(c) advertisement, , investment statement,
4: Section 70(1) paragraph (c)
ca: Prescribing, in respect of securities offered to the public, the kinds of information that must be sent to security holders periodically or on request; and different kinds of information may be prescribed in respect of different kinds of securities: .
5: Without limiting section 12 of the Acts Interpretation Act 1924 section 70
38: Action taken by Working Group on Improved Product and Investment Adviser Disclosure
Any action taken by or on behalf of the body of persons known as the Working Group on Improved Product and Investment Adviser Disclosure before the commencement of this Act in consulting with persons or organisations on proposed amendments to the Securities Regulations 1983 section 70(3)(a) subsection (1) section 37
39: Schedule 1 Schedule 1 section 47(1) Financial Reporting Act 1993 Industrial and Provident Societies Act 1908 Investment Advisers (Disclosure) Act 1996