Financial Markets Conduct Act

On 1 April the first phase of the Financial Markets Conduct Act reforms came into effect. Included in this phase are legislative changes facilitating:

  • Equity crowd funding, which businesses can use to raise capital from the public without the usual prospectus and investment statement disclosure documents. There are already at least a couple of operators positioning themselves to be the country’s leading equity crowd funding platform, and this is a development that’s sure to generate a lot of interest this year.
  • Peer-to-peer lending, which matches borrowers and lenders without the full securities law complications that have prevented this type of service operating to date.
  • Small offers, without the need to prepare a prospectus and investment statement. This exemption applies to offers of up to $2million from up to 20 investors in any 12 month period.
  • Employee share schemes, on a much more company-friendly basis. For further discussion on employee share schemes, see here.

These reforms have been widely anticipated. The Lowndes Jordan team has specialist expertise and significant experience in securities law and employee share schemes. If you or any of your clients are looking at raising capital or implementing an employee share scheme, or investing in a company or participating in an employee share scheme, please contact Michael Busch or Andrew Wallace.

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