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Financial Markets Conduct Act 2013

Dealing in financial products on markets - Civil liability for certain contraventions of this Part

385: Part 5 market provisions

You could also call this:

"Rules for buying and selling financial products on markets"

Illustration for Financial Markets Conduct Act 2013

When you deal with financial products on markets, you need to know about Part 5 market provisions. These provisions are rules that you must follow when dealing with financial products on markets. You can find these rules in sections like sections 241 to 243, sections 262 and 265, and section 270.

If you break these rules, you may have to pay a penalty, which is a fine. The penalty can be up to $1 million for an individual or $5 million for a company, depending on the case. You can read more about penalties in subpart 3 of Part 8.

There are more rules you need to follow, like those in sections 276 to 279, section 286, and sections 297 and 298. If you break these rules, you may have to pay a penalty of up to $200,000 for an individual or $600,000 for a company. You can also read about these penalties in subpart 3 of Part 8.

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Part 5Dealing in financial products on markets
Civil liability for certain contraventions of this Part

385Part 5 market provisions

  1. All of the provisions specified in subsections (3) and (4) are Part 5 market provisions.

  2. A contravention of any of the provisions listed in subsection (3) may give rise to civil liability (see subpart 3 of Part 8), including a pecuniary penalty not exceeding the greatest of the consideration for the relevant transaction, 3 times the amount of the gain made or the loss avoided, and $1 million in the case of an individual or $5 million in any other case.

  3. The provisions are the following:

  4. sections 241 to 243 (insider conduct prohibited):
    1. sections 262 and 265 (market manipulation):
      1. section 270 (continuous disclosure):
        1. section 310 (need for financial product market licence):
          1. section 311 (prohibition on holding out):
            1. any provision of regulations made under section 351 that is stated by those regulations to be a Part 5 market provision and to give rise to civil liability under this subsection.

              1. A contravention of any of the following may give rise to civil liability (see subpart 3 of Part 8), including a pecuniary penalty not exceeding $200,000 in the case of an individual or $600,000 in any other case:

              2. sections 276 to 279 and sections 289 to 291 (substantial holding disclosure obligations):
                1. section 286 (conditions of exemption for corporate trustees and nominee companies):
                  1. sections 297 and 298 (directors' and senior managers' disclosure obligations):
                    1. section 327 (licensed markets must be operated under market rules that comply with subpart):
                      1. section 334 (overseas-regulated markets must give notice of market rules and rule changes to FMA):
                        1. section 342 (Minister may give market operator obligations direction to licensed market operator):
                          1. section 346(1)(a) (effect of exceeding control limit):
                            1. any provision of regulations made under section 351 that is stated by those regulations to be a Part 5 market provision and to give rise to civil liability under this subsection:
                              1. sections 352, 355, 357, 359, and 367 (requirements applying in operation of licensed market):
                                1. unsolicited offer provisions imposed under section 382.