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Financial Markets Conduct Act 2013

Disclosure of offers of financial products - Procedure for making regulated offers - Product disclosure statement must be prepared and lodged

48: PDS must be prepared and lodged

You could also call this:

"Before selling financial products, you must create and submit a special document called a Product Disclosure Statement."

If you want to make a regulated offer, the person selling the financial products must prepare a product disclosure statement, or PDS, for the offer. They must also lodge the PDS with the Registrar and give the Registrar all the information required by the Financial Markets Conduct Act 2013. You cannot make a regulated offer or give out application forms unless the issuer has done these things.

If you break this rule and you know you are making a regulated offer, or you do not care if it is a regulated offer, you can commit an offence. If you are found guilty, you can be punished with a fine or imprisonment, depending on who you are.

As an individual, you can be imprisoned for up to 5 years, or fined up to $500,000, or both, if you commit this offence. If you are not an individual, you can be fined up to $2.5 million.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4090981.

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47: Territorial scope of Part, or

"When financial products are offered in New Zealand, this part of the law applies, no matter where they come from."

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49: Purpose of PDS, or

"What a Product Disclosure Statement is meant to do: help you decide on a financial product."

Part 3Disclosure of offers of financial products
Procedure for making regulated offers: Product disclosure statement must be prepared and lodged

48PDS must be prepared and lodged

  1. A person must not make a regulated offer, or distribute an application form for a regulated offer, unless the issuer of the financial products has—

  2. prepared a product disclosure statement (PDS) for the offer; and
    1. lodged the PDS with the Registrar; and
      1. supplied to the Registrar all of the information that the register entry (if any) is required to contain by this Act or the regulations.

        1. A person who contravenes subsection (1) commits an offence if the person knows that, or is reckless as to whether, the offer is a regulated offer.

        2. A person who commits an offence under subsection (2) is liable on conviction,—

        3. in the case of an individual, to imprisonment for a term not exceeding 5 years, a fine not exceeding $500,000, or both; and
          1. in any other case, to a fine not exceeding $2.5 million.