More muscle, more money: FMA levies up for debate

Whether FMA funding levies should be paid by all companies in New Zealand, or just those under the investor watchdog’s eye, is up for debate with the government.

A discussion document proposing options for third-parties to fund the broadened scope and responsibility of the Financial Markets Authority (FMA) was released by government today.

Proposed levies would also extend to the External Reporting Board, the Companies Office and the Insolvency Trustee Service.

Commerce Minister Simon Power said government had given the FMA more powers to help restore confidence in financial markets and entice investors back, so businesses had access to the capital for growth.

Investors could now take civil action against a financial market player and the FMA had been given greater warning power to deal with low-ball, unsolicited offers and ability to stop financial products from being structured to avoid its supervision.

But more money was needed to deliver that, he said.

Third-party payments would be on top of the FMA’s budget increase to $26 million by 2014/2015 – an increase of about 44% from the current $18 million.Proposals up for discussion include:

• New charges to fund the FMA’s responsibilities for the new auditor oversight regime, which is a core element of financial market confidence. 

• A levy to cover some of the operational costs of the additional functions of the External Reporting Board, which will be responsible for all financial reporting, audit, and assurance standards-setting.

 • Changes to the fee structure of the Companies Office and the Insolvency and Trustee Service, to cover the costs of providing these services to companies.

Submissions on the document close on July 8.

Georgina Bond
Fri, 10 Jun 2011

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More muscle, more money: FMA levies up for debate