Plain language law

New Zealand law explained for everyone

Financial Markets Conduct Act 2013

Enforcement, liability, and appeals - Civil liability - Other civil liability orders

498: Terms of other civil liability orders

You could also call this:

"What happens if you break the rules: the court's orders to fix things"

Illustration for Financial Markets Conduct Act 2013

If you break the rules under the Financial Markets Conduct Act 2013, a court can make an order against you. The court can order you to refund money or return property to someone who has been hurt by what you did. This person is called the aggrieved person.

If you made an agreement with the aggrieved person, the court can change the agreement or cancel it. The court can also order you to do something to put things back the way they were before.

The court can stop you from using certain rights related to financial products. It can also stop you from issuing or transferring financial products, or from getting money from them. You might be ordered to get rid of financial products or interests, and to pay the money from the sale to someone else. In some cases, the court can even take away your financial products and cancel them. It can also cancel agreements you made to buy or sell financial products.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4091726.

Topics:
Money and consumer rights > Banking and loansMoney and consumer rights > Consumer protectionBusiness > Industry rulesBusiness > Fair trading
Previous

497: When court may make other civil liability orders, or

"The court can make a special order if someone breaks or plans to break a rule."

Next

499: General defences for person in contravention, or

"Excuses for breaking financial rules that might let you off"

Part 8Enforcement, liability, and appeals
Civil liability: Other civil liability orders

498Terms of other civil liability orders

  1. A civil liability order under section 497 may—

  2. direct the person in contravention, or the person involved in the contravention, to refund money or return property to a person who has suffered, or is likely to suffer, loss or damage because of the contravention (the aggrieved person):
    1. if an agreement has been entered into between the person in contravention, a person involved in the contravention, or an associated person of either of those persons (A), and the aggrieved person,—
      1. vary the agreement or any collateral arrangement as specified in the order and, if the court thinks fit, declare the agreement or arrangement to have had effect as so varied on and after a date before the order was made, as specified in the order:
        1. cancel the agreement and, if the court thinks fit, declare the cancellation to have had effect on and after a date before the order was made, as specified in the order:
          1. require A to take any action the court thinks fit to reinstate the parties as near as may be possible to their former positions:
          2. restrain the exercise of rights attaching to financial advice products, or the exercise of relevant interests, or declare an exercise of those rights or relevant interests to be void and of no effect:
            1. restrain the issue or transfer of financial products or restrain any distribution due in relation to financial products:
              1. restrain the acquisition or disposal of financial advice products or of relevant interests, or restrain the registration of any transfer of that kind:
                1. direct the disposal of financial products or of relevant interests (including the person or class of persons to which the products or interests must, or must not, be disposed of) and direct the payment of the proceeds of any disposal:
                  1. require financial products to be forfeited and require the issuer to cancel the forfeited financial products:
                    1. cancel an agreement for the acquisition or disposal of financial products or relevant interests.

                      Compare
                      Notes
                      • Section 498(c): amended, on , by section 18 of the Financial Markets (Conduct of Institutions) Amendment Act 2022 (2022 No 36).
                      • Section 498(e): amended, on , by section 18 of the Financial Markets (Conduct of Institutions) Amendment Act 2022 (2022 No 36).