
	Advanced Search

How to Apply for an Exemption

The most commonly asked questions about seeking an exemption, and answers to them are detailed below.

What laws can the Commission give an exemption from?

You may apply to the Commission for an exemption from compliance with any provision of:

Part II of the Securities Act 1978
any regulations made under section 70(1) of the Act
Part II of the Securities Markets Act 1988
any regulations made under Part II of the Markets Act

and the following provisions of the Financial Reporting Act 1993:

in the case of issuers who are incorporated or constituted overseas: sections 8 to 11, 13 to 16, 18, 36, 36A or 38; and
in the case of recipients of money from conduit issuers: section 4(1)(ba).

When is an exemption required?

The Commission does not generally offer advice or give legal rulings on how securities law applies and whether in the circumstances an exemption may be required. The applicant makes its own interpretation of the law when deciding whether to apply for an exemption. In difficult cases the Commission will ask for the applicant's reasons for concluding that the law applies. This is for the purpose of ensuring that it has jurisdiction to act.

However the Commission considers that its exemption power only extends to the compliance provisions of the Act, and does not extend to the liability provisions. It has not been willing to approve an exemption from any of sections 55 to 65 of the Securities Act. For the same reasons, the Commission is also unlikely to exempt issuers from sections 36, 36A or 38 of the Financial Reporting Act.

Also the Commission is unlikely to exempt issuers from any general advertising provision of the Securities Act or Regulations which would remove the issuer's obligation to ensure that its advertising was not likely to deceive, mislead or confuse, or from section 18 of the Financial Reporting Act, which requires issuers to register financial statements with the Registrar.

Do I need a lawyer to apply for an exemption?

Compliance with securities law more often than not involves complex issues about the interpretation and application of the law. Questions about liability arise. The matter can be complex. Generally we recommend that you seek legal advice before making an application.

How do we apply for an exemption?

Your application should be in writing and addressed to the General Counsel, Securities Commission. Our postal and fax addresses are listed below. If you prefer you can send your application on disk in Word format or by e mail to seccom@seccom.govt.nz. A hard copy of your application should also be forwarded together with the cheque for the application fee.

What is required in an application for an exemption?

Formats for exemption applications from the securities legislation and Financial Reporting Act are available. We recommend that you follow the format so that all the necessary information is provided and delays are avoided. The formats can be downloaded in Word. In preparing an exemption application you should consider the interests of the issuers and the prospective investor.

Conflicts of Interest

Individual Commission Members sometimes may have a conflict of interest with a matter that comes before the Commission. If you think any Commission Member may be conflicted in the matter you are dealing with for exemption it would be helpful to note this in your application. Commission Members and their professional details are available here.

What are the charges?

Exemption applications under Securities Act

A cheque for $1,237.50 should accompany each application for an exemption. This represents the application fee of $100 prescribed under the Securities (Fees) Regulations 1998 and an advance of $1,000 in respect of fees and costs to be incurred, plus GST.

The Securities (Fees) Regulations 1998 prescribe charging rates of $200 plus GST per hour for time spent by Members of the Commission and $145 plus GST per hour for time spent by professional staff.

Exemption applications under Financial Reporting Act

A cheque for $1237.50 should accompany each application for an exemption. This represents the application fee of $112.50, including GST, prescribed under the Financial Reporting (Fees and Forms) Regulations 2007 and an advance of $1125, including GST, in respect of fees and costs to be incurred.

The Financial Reporting (Fees and Forms) Regulations 2007 prescribe charging rates of $225, including GST, per hour for time spent by Members of the Commission and $163, including GST, per hour for time spent by professional staff.

We are also empowered under both sets of Regulations to obtain independent expert assistance relating to particular applications and to recover the cost of this although we will consult beforehand if we think this is necessary. We are willing to provide estimates for our work. While we endeavour to provide reliable estimates we do not consider ourselves bound to limit our charges to the amount of the estimate and will seek payments at the prescribed rates.

You will be sent an account for costs, where required, each month and at the conclusion of our work. If the cost of work done at the prescribed rates does not exceed the amount paid in advance a refund will be made when our work is finished. Our experience is, however, that this will only arise in a few cases.

If the application is granted the applicant also reimburses the Commission for the costs of printing and gazetting the exemption notice at the rate of 55 cents per word including GST.

How long does it take?

It generally takes us approximately four to six weeks from the time we receive an application until an exemption is gazetted. This may be much longer if difficult questions of policy arise. You need to let us have all the information promptly and allow us sufficient time to process the application. Processing time depends on the nature and quality of the application and the resources available within the Commission when you apply. Time must also be allowed for referral to Parliamentary Counsel Office, notification in the New Zealand Gazette and publishing. If your application is urgent you must provide a time frame within which (a) a decision is needed, and (b) any exemption granted needs to be gazetted. You must also provide reasons for any request for urgent consideration.

What steps are involved?

Application considered by staff
Your application is considered by Commission staff, who prepare a memorandum for Members of the Commission to consider. You may be asked to provide further information at this stage. This process is speeded up when the applicant provides quality information at the time of application, and responds to queries promptly.
Consideration by Commission Members
When the memorandum is finalised it is put to a Commission meeting. Exemptions that raise significant policy questions are considered by a full meeting of the Commission, usually held every third Thursday of the month. Other exemptions can be considered by a quorum of Members as the need arises.
Notice drafted by Parliamentary Counsel Office
If the application is approved the Commission instructs the Parliamentary Counsel Office to prepare the exemption notice. Parliamentary Counsel Office (which is not an arm of the Commission) drafts all legislation and delegated legislation including exemption notices. One to two weeks should be allowed for Parliamentary Counsel to prepare a draft, but complex notices may take longer. You will generally be invited to comment on a draft notice before the final form of the exemption is settled. You should not deal directly with Parliamentary Counsel Office.
Notification in the New Zealand Gazette
Each exemption notice is signed under seal by the Chairman or other Member of the Commission. The Commission must give notice of the exemption in the Gazette, which is published each Thursday. If a notice is not ready in time to meet the midday Tuesday deadline for the Gazette, it may be possible to arrange for a supplementary Gazette to be published at your cost. A supplementary Gazette costs approximately $700 including GST. In most cases an exemption does not come into force until the day after it has been notified in the Gazette.

How do we know that an approved exemption has been gazetted?

You should check the Gazette before seeking to rely on an exemption notice.

Where can we get a copy of the notice?

Exemption notices are sold by Bennetts Bookshops and some Whitcoulls stores.

Bennetts Bookshop in Wellington has all legislation and provides a mail service throughout the country. Contact them by phone 04 499 3433 or fax 04 499 3375.

Exemption Policy Note
Check this policy note if you are applying for an exemption to exclude commercially sensitive information from material contracts.

Also see formats for applying for exemptions.

HOW TO CONTACT US

Securities Commission
Level 8
Unisys House
56 The Terrace
P O Box 1179
Wellington

Tel:(64-4) 472 9830
Fax:(64-4) 472 8076
Email: seccom@seccom.govt.nz
Web page: www.seccom.govt.nz