Systems (Commercial Matters) Amendment Act has now been enacted and will
generally come into force on 30 May 2017.
It includes provisions which will reduce compliance costs for companies and for entities subject to the Financial Markets Conduct Act 2013 (FMCA).
Removing the requirement for listed issuers to send notices of
financial assistance to all of their shareholders. Instead they will be
able to provide the notice to NZX for release.
Allowing the board not to convene an AGM where there is no business
requiring an AGM and it is not in the company’s interests to hold one.
Removing the requirement for “large” companies to prepare or have
audited financial statements where the company is covered by group
financial statements prepared by the parent. The need to prepare an annual
report for such companies will also be removed where this is supported by 95%
Making minor changes to the “section 209” relief (refer to our
earlier commentary for more
detail). This change will be brought into effect by regulation and is
expected to be available for annual reports prepared by listed issuers
with a 30 June or later balance date. In the meantime, the Bill removes
the need to refer to a concise annual report if there isn’t one.
Allowing companies to accept proxies and postal votes closer to
meetings than the current 48 hour cut off if the company constitution
Extending the time for disclosure by directors or senior managers
who acquire a relevant interest in financial products as a result of being
the trustee of a testamentary trust or the executor or administrator of
the estate of a deceased person.
Allowing the Financial Markets Authority to grant exemptions in
relation to indemnities for overseas issuers.
Extending the same class offer regime to the offer of options to
acquire quoted financial products.
A new power for the Takeovers
Panel to expeditiously determine reimbursement of cost disputes in relation to
takeover offers (whether successful or unsuccessful) will commence on Royal
Assent, although the power will not apply to takeovers made prior to
commencement of the law change. This change is timely, given recent disputes over
the failed takeovers for Kathmandu and Abano will probably need the High Court
submitted to the Ministry of Business, Innovation and
Employment and the Commerce Select Committee, we generally support all of the
changes to the Companies Act 1993 and the FMCA.
There are a
few further regulatory issues under the FMCA in particular which could usefully
be addressed in future bills of this nature, including around employee share
schemes, the status of treasury stock under the FMCA and the treatment of the
issue of financial products for the purposes of insider trading.