NZAX-listed Vetilot, which was formerly Investment Research Group and is now a shell company, was ordered to pay $40,000 and costs, and publicly censured for failing to file its 2013 annual report by July 31 last year, leading to a week-long suspension in August, NZX's disciplinary tribunal said in a statement on Friday after the close of trading. The fine would have been higher had the breach been longer and the company been larger, the regulator said.
"The Tribunal was dismayed to find the company in breach of Rule 10.5.1 for a second time in a relatively short period - with VET (or IRG as it then was) having already been the subject of disciplinary action by the Tribunal for breaches of obligations under the Rule with respect to the periodic reporting in March 2011," the tribunal said. "It is completely unsatisfactory that VET has again failed to release its annual report when due."
Vetilot's repeated breach raised an issue for the tribunal as to how the NZX should respond to serial offending, and recommended the stock market operator should consider whether a pattern of behaviour should spark other remedial action.
"The Tribunal also suggests that the drivers for taking such a proactive approach are, if anything, amplified in the case of 'shell' companies," it said. "Specifically, it is important that need for compliance must be actively encouraged not only to ensure market integrity but also to maintain another mechanisms for businesses to list without the cost of an IPO."
In a separate notice today, the tribunal said financial services group NZF will be fined $35,000 and publicly censured after settling with the disciplinary board after failing to file its 2013 annual report, leading to four-and-a-half month trading suspension last year.
The aggravating factors in the NZF case were the four-and-a-half month delay in releasing the annual report, and that NZF failed to meet its earlier guidance on when it would release the statements.