[ Last Updated 31 July 2008 ]
Short Description
Consultation on Draft Regulations for the Securities Markets (Disclosure of Relevant Interests by Directors and Officers) Amendment Regulations 2008.
On 7 July 2008 Cabinet agreed to amend the Securities Markets (Disclosure of Relevant Interests by Directors and Officers) Regulations 2003 (the Regulations) to reduce compliance costs associated with a relatively wide definition of "officer" and introduce some operational improvements to the Regulations.
Under the Securities Markets Act 1988, directors and officers of public issuers (that is, issuers whose securities are listed on a registered exchange) are required to disclose to the public, relevant interests and dealings in securities of the public issuer and any related body corporate. The disclosed information is used to assist in the monitoring of possible insider trading activities and market manipulation. It also is designed to encourage transparency and good corporate governance in securities dealings. The disclosure regime has been in operation since 2004 and the industry interpreted the requirements to apply to a significant number of employees thereby increasing compliance costs.
The proposed amendment regulations will reduce the number of people included in the definition of "officer" to people who are within two tiers of direct reporting to the Board of Directors. This amendment would target the legislation at the area where the insider trading risk is perceived to be the most acute. The recently introduced insider trading regime has also reduced the need for the disclosure regime in its current form.
For operational efficiency, and to align the disclosure mechanics with the Substantial Security Holder disclosure obligations, several minor improvements and simplifications to the current disclosure regime are also proposed, e.g. the redesign of the disclosure form. This will provide greater uniformity across the sector further reducing compliance costs associated with the disclosure obligations.
How to make a submission
Written submissions are invited from all interested parties, and will be considered prior to the final Cabinet approval.
The closing date for submissions is Friday 15 August 2008 at 5pm.
Submissions should be directed to:
Email: financialsectorsubmissions@med.govt.nz
Post: Sailesh Khandu
Ministry of Economic Development
PO Box 1473
Wellington
Delivery address: Level 8, 33 Bowen Street, Wellington
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