Feedback is sought on a proposed fee structure under the Financial Markets Conduct Act (FMCA).

The Ministry of Business, Innovation and Employment (MBIE) wants submissions by 27 June 2014.

General approach

The proposals cover registration fees for registering offers on the new online register to come into operation on 1 December, and FMA levies and fees for ongoing approvals, particularly for continuously offered products, and managed investment schemes (MIS).

The Government made decisions on licensing fees in conjunction with commencement of Phase 1 of the FMCA from 1 April.

The discussion document states that the fee model is designed to have as few charging points as possible. The register costs have been split 75:25 between the issuers of financial products and MIS managers.

MBIE is modelling that 25% of MIS will transition to the new regime in the first year with the rest moving across in the second year.

Proposals in summary

Service/function Current Proposed (GST inc)
FMC register fees
Lodging offer documents No fee $3,000 flat fee
Annual confirmation offer documents No fee $3,000 flat fee
Registering an MIS No fee $775 flat fee
Lodging an MIS annual report No fee $275 flat fee
FMA levy and other FMA fees
Registering an offer document $2,000 levy $2,000 levy
Reviewing offer documents $327.11 flat fee Fee removed
Permission relating to the governance of regulated products No fee $178.25 per hour
Approval of retirement scheme transfers $255.55 per hour $178.25 per hour
Consent to reversion of retirement scheme assets to an employer $255.55 per hour $178.25 per hour
Cancellation retirement scheme registration $255.55 flat fee $178.25 per hour
Filing annual accounts of a wound up superannuation scheme $255.55 flat fee $178.25 per hour
Providing annual report for superannuation scheme From $102.22 flat fee From $178.25 per hour
Registering a superannuation scheme $102.22 flat fee $178.25 per hour
Amendments to trust deed $51.11 flat fee $178.25 per hour
Financial Advisers Act variation fees No fee $115 application fee and $178.25 per hour
Filing financial statements $255.55 flat fee $255.55 flat fee
Financial market operator licensing fees
Licence applications/variations No fee $178.25 per hour
Market rule applications/changes $115 admin fee and $178.25 per hour $178.25 per hour

Costs comparison for issuers

Type of issuer Now Year 1 Out Years
One off equity issuer $2,327 $5,000 N/A
Continuous debt issuer $2,327 (each year) $5,000 $3,000
Fund manager (1 KiwiSaver scheme and 2 PDSs) $4,501 $10,775 $6,275 (compared to $4,756 now)

The information in this article is for informative purposes only and should not be relied on as legal advice. Please contact Chapman Tripp for advice tailored to your situation.