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24 July 2009

News release

Hon Simon Power, Minister of Commerce

Securities and Financial Advisers Amendment Bills passed

A bill that will make it easier for businesses to raise capital while ensuring prospective investors have all the appropriate information was passed by Parliament last night, Commerce Minister Simon Power said.

The Securities (Disclosure) Amendment Bill amends the Securities Act 1978 on the recommendation of the Capital Market Development Taskforce.

"The bill allows businesses to issue a simplified disclosure prospectus that will help do away with a lot of duplicated information that many businesses listed on the Stock Exchange face when making a securities offer," Mr Power said.

"Listed companies will be able to use this new type of prospectus for offers of certain securities, instead of a full registered prospectus and investment statement. This will significantly reduce the need to duplicate information that is already publicly available under the continuous disclosure obligations.

"The bill will help reduce costs and time for companies raising capital in this financially challenging environment while ensuring the timely disclosure of information to investors.

"It also makes technical changes relating to categories of people exempt from disclosure requirements, which will make it easier for all companies, listed and unlisted, to raise capital.

"These amendments will particularly benefit small and medium-size businesses that traditionally seek capital by 'shoulder-tapping' known investors.

"I'm confident that the passing of this bill will help New Zealand respond to the current financial crisis," Mr Power said.

"The Financial Advisers Amendment Bill has also passed its third reading. This bill makes some relatively minor changes to the Financial Advisers Act which will ensure that the regime works as effectively as possible."