Thursday 7th April 2011
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Commerce Minister Simon Power has announced the Financial Markets Authority (FMA) will be up and running on May 1, after the Bill to establish it was passed unanimously in Parliament today.
"'m proud the FMA will be up and running almost a year to the day after the Government announced it would be picking up the recommendation from the Capital Market Development Taskforce," Power said.
"I'm confident it will have the tools it needs to help restore mum and dad investor confidence in our financial markets, after issues were raised following the global financial crisis, and the failure of a number of finance companies."
The Financial Markets (Regulators and KiwiSaver) Bill established the FMA as the single market conduct regulator, taking over the functions of the Securities Commission and Government Actuary which are being disestablished, and consolidates other regulatory functions fragmented across the Ministry of Economic Development.
The Bill gives the FMA powers, functions and duties that are new to the regulator, including the power to exercise an investor's right to take civil action against a financial market participant, act against low-ball share offers and prevent products being structured to avoid regulatory supervision.
"If we are to develop the kind of vibrant capital markets needed to lift New Zealand's economic performance, and benefit companies looking to raise capital, our financial sector must be subject to clear rules, and visible and proactive enforcement," Power said.
Parliament also unanimously approved The Securities Trustees and Statutory Supervisors Bill, which closes gaps that were exposed in the recent finance company collapses.
The Bill requires all corporate trustees, including those for non-restricted KiwiSaver schemes, to be licensed, along with certain statutory supervisors.
"This Bill will protect the interests of investors by requiring trustees and statutory supervisors to be competent, perform their functions effectively and be held accountable by the FMA if they fail to meet expected standards," Power said.
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