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Financial Markets Conduct Act 2013

Enforcement, liability, and appeals - Civil liability - Defences for person in contravention of civil liability provisions

501A: Additional defence for licensees who are treated as contravening

You could also call this:

"A defence for licensees blamed for others' mistakes"

Illustration for Financial Markets Conduct Act 2013

If you are a licensee and someone else does something wrong, you might be treated as if you did it. This can happen if an authorised body, let's call it A, breaks a rule that licensees must follow, and you, let's call you B, are the licensee who is affected by what A did, under section 400(3). You can use this as a defence if you can prove you took all reasonable steps to make sure A followed the rules.

You can say you did everything you could to ensure A complied with the rules. If you can prove this, it can be a defence for you.

This defence does not stop you from using other defences you might have under section 499 or section 500, which are about being treated as if you broke a rule that licensees must follow.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7398728.

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Part 8Enforcement, liability, and appeals
Civil liability: Defences for person in contravention of civil liability provisions

501AAdditional defence for licensees who are treated as contravening

  1. This section applies if—

  2. an authorised body (A) contravenes any market services licensee obligation; and
    1. a person (B) is the licensee who is treated as being in contravention under section 400(3).

      1. In any proceeding under this subpart against B, it is a defence if B proves that B took all reasonable and proper steps to ensure that A complied with the market services licensee obligation.

      2. Subsection (2) does not limit any defence that B may have under section 499 or 500 (as a person who is treated as contravening a market services licensee obligation).

      Notes
      • Section 501A: inserted, on , by section 87 of the Regulatory Systems (Commercial Matters) Amendment Act 2017 (2017 No 12).