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Building Societies Act 1965

Miscellaneous provisions

122D: Power of FMA to require actuary's certificate as to appropriations by ballot

You could also call this:

"FMA can ask for a special money report when groups use ballots to share money"

The FMA (Financial Markets Authority) can ask a terminating society that uses ballots for giving out money to its members to get a special document. This document is called an actuary's certificate. An actuary is a person who is good at maths and working out money risks. The Minister must approve the actuary.

The certificate needs to say that if members pay their shares properly, they have a good chance of getting money within 30 years from when their group started. The FMA can also ask for this certificate from companies that used to be terminating societies and still use ballots to decide who gets loans.

If the society or company doesn't give the FMA the certificate within a month (or a bit longer if the FMA allows), the FMA will tell them to change their rules. They have three months to do this so they can get the certificate.

If the society or company still doesn't give the certificate after those three months, the FMA can ask for the society or company to be closed down. This is called being put into liquidation. The FMA would use the Companies Act 1993 to do this.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM372383.

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Part 9Miscellaneous provisions

122DPower of FMA to require actuary's certificate as to appropriations by ballot

  1. The FMA may at any time by notice in writing to a terminating society, being a society whose rules provide for shareholders to receive appropriations by ballot, call upon the society to supply the FMA with a certificate from an actuary, approved for the purposes of this section by the Minister, certifying that every member of a terminating group of the society, if that member's share or shares are properly paid up in accordance with the rules, has a reasonable prospect of receiving appropriations within not more than 30 years from the date of the formation of the group in which that member's share or shares were originally issued.

  2. The FMA may at any time by notice in writing to a company into which a terminating society has become converted that conducts ballots for the purpose of determining entitlement to loans call upon the company to supply the FMA with a certificate from an actuary, approved for the purposes of this section by the Minister, certifying that every person entitled to participate in any ballot conducted for that purpose, if that person complies with any terms and conditions to which that entitlement is subject, has a reasonable prospect of receiving appropriations within not more than 30 years from the date of the formation of the terminating group of the society that has become so converted in which that person's share or shares were originally issued.

  3. If the society or the company, as the case may be, fails to supply the certificate within 1 month after the date of the notice, or within such further time as the FMA may in the FMA's discretion allow, the FMA shall, by a further notice to the society or the company, call upon the society or the company so to amend its rules within 3 months after the date of the further notice as to enable such a certificate to be given.

  4. If a society or the company, as the case may be, fails to comply with a further notice under subsection (3) and to supply the certificate within the said period of 3 months, the FMA may,—

  5. in the case of a society, apply to have the society put into liquidation under the Companies Act 1993; or
    1. in the case of a company, apply to have the company put into liquidation under the Companies Act 1993.

      Notes
      • Section 122D: inserted, on , by section 29 of the Building Societies Amendment Act 1987 (1987 No 175).
      • Section 122D heading: amended, on , by section 82 of the Financial Markets Authority Act 2011 (2011 No 5).
      • Section 122D(1): amended, on , by section 82 of the Financial Markets Authority Act 2011 (2011 No 5).
      • Section 122D(2): amended, on , by section 82 of the Financial Markets Authority Act 2011 (2011 No 5).
      • Section 122D(3): amended, on , by section 82 of the Financial Markets Authority Act 2011 (2011 No 5).
      • Section 122D(4): replaced, on , by section 2 of the Company Law Reform (Transitional Provisions) Act 1994 (1994 No 16).
      • Section 122D(4): amended, on , by section 82 of the Financial Markets Authority Act 2011 (2011 No 5).
      • Section 122D(4)(b): replaced, on , by section 14 of the Companies Amendment Act 2013 (2013 No 111).