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New Derivatives Regulations in Effect for Issuers to NZ Clients

Posted on December 4th, 2017 by Sophie Gerber in Licensing

Starting today, all derivatives issuers (issuers) who make regulated offers to New Zealand clients must be licensed by the New Zealand Financial Markets Authority (FMA).

Previously, financial services entities were able to obtain Financial Services Provider (FSP) registration and offer short-term derivative contracts (i.e. those that are settled within 3 days) to both retail and wholesale clients based in New Zealand without the need to be formally licensed by the FMA.

This meant that these entities could operate a trading platform with limited regulation in a respected jurisdiction. However, the lack of regulation around short-term derivative trading and other derivative products led to a vast number of retail client complaints to the FSP.

Read More on Finance Magnates or in PDF on our Media Page.