FMA seeks more feedback on disclosure rules

BUSINESSDESK: The Financial Markets Authority will go back to industry for a second time as it seeks feedback on how issuers should prepare offer documents.

Chief executive Sean Hughes yesterday said the market watchdog met with more than 30 stakeholders and received 60 submissions on its consultation paper after the first round closed last week, and will seek further guidance on what should be in investment statements and prospectuses.

“We are genuine about engaging fully and frankly with the market,” Hughes said at the launch of the Financial Services Council.

The FMA, which replaced the Securities Commission as a super-regulator last year, put out the consultation paper in January to gauge what the industry thinks should be minimum disclosure requirements for offer documents. That comes as the government overhauls securities legislation with the Financial Markets Conduct Bill, which passed its first reading last week.

In the consultation paper, the watchdog proposed giving all existing issuers until the end of the year to get their offer documents in order, while new investment statements would need to comply from May 1.

The FMA also urged the use of ‘plain English’, while discouraging the use of pictures and brand imagery unless it was necessary to explain the offer.

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