What is a Financial Service Provider (FSP)?
Any person or Company providing Financial Services from or within New Zealand.
How the laws in New Zealand points out a financial service provider?
According by the law, "financial service" means any of the following financial services:
- financial adviser service;
- - a broking service;
- acting as a deposit taker as defined in the Reserve Bank of New Zealand Act 1989;
- being a registered bank;
- keeping, investing, administering, or managing money, securities, or investment portfolios on behalf of other persons;
- providing credit under a credit contract;
- operating a money or value transfer service;
- issuing and managing means of payment (for example, credit and debit cards, cheques, travellers’ cheques, money orders, bankers’ drafts, and electronic money);
- giving financial guarantees;
- participating in an offer of securities to the public in either of the following capacities (within the meaning of those terms under section 2(1) of the Securities Act 1978);
- - as an issuer of the securities;
- - as a promoter;
- acting in any of the following capacities (within the meaning of those terms under section 2(1) of the Securities Act 1978) in respect of securities offered to the public;
- - as a trustee;
- - as a unit trustee;
- - as a superannuation trustee;
- - as a manager;
- changing foreign currency;
- entering into derivative transactions, or trading in money market instruments, foreign exchange, interest rate and index instruments, transferable securities (including shares), and futures contracts on behalf of another person;
- providing forward foreign exchange contracts;
- acting as an insurer;
- providing any other financial service that is prescribed for the purposes of New Zealand complying with the FATF Recommendations, other recommendations by FATF, or other similar international obligations that are consistent with the purpose of this Act
What is the Dispute Resolution Scheme (DRS)?
It is an arbitrary facility required by the government by a third party organisation duly licensed, in order to strengthen consumer protection and to assist any conflict between a retail customer and a Financial Institution.
Do all FSPs need apply for a Dispute Resolution Scheme?
No, only who's offering services to retail clients.
What is the difference between a retail client and a a wholesale client?
A retail client is any person who receives a financial service, while a wholesale clients is as follow, according with the law definitions:
- who provides financial services and receives financial services in the course of that business;
- who has as principal business invests money or habitually invests money;
- an entity to which at least 1 of the following applied at the end of each of the last 2 completed accounting periods;
- - at the balance date, the net assets of the entity exceeded $1 million;
- - the turnover of the entity for the accounting period exceeded $1 million;
- a related body corporate (within the meaning of section 5B(2) of the Securities Markets Act 1988) of an entity to which paragraph (c) applies;
- a local authority, a Crown entity, a State enterprise, the Reserve Bank of New Zealand, and the National Provident Fund (and a company appointed under clause 3(1)(b) of Schedule 4 of the National Provident Fund Restructuring Act 1990);
- a person who falls within 1 or more of the categories listed in section 3(2), 5(2CB), or 5(2CBA) of the Securities Act 1978 if the service relates to securities that may be offered to that person, or that have been subscribed for by that person, in a private offer of securities;
- an eligible investor under section 49A;
- if the financial service is a financial adviser service or a broking service, a person who is a wholesale client in respect of that service under the Financial Advisers Act 2008.
(3) If subsection (2) applies to a person (A), it applies equally to any controlling owner, director, employee, agent, or other person acting in the course of, and for the purposes of, A’s business to the same extent as it applies to A.
(4) In this section, entity;
- includes a body corporate and an unincorporated body (including partners in a partnership, members of a joint venture, or the trustees of a trust) and the sole trustee of a trust acting in his, her, or its capacity as trustee of that trust; but
- does not include an individualprivate offer of securities means an offer of securities that does not constitute an offer of securities to the public under section 3 of the Securities Act 1978; or is exempt from Part 2 (other than sections 38B and 58) of that Act under section 5(2CB) or 5(2CBA) of that Act
A FSP needs "regulatory capital"?
No, whether the services are provided to no-NZ residents.
Do my business need a credit rating?
No, whether the services are provided to no-NZ residents.
Any restriction about the directors or shareholders?
There are not restrictions. Anyone, resident anywhere, of any nationality.
Let's start then, what is the process?
Very simple, contact us.
What about the legal good standing and NZ Office?
Although many providers declare that you need to maintain only a physical registered office in New Zealand and file annual returns to the Companies Register as well as to the FSP Register. This is not true!! The Email below had been sent by the government to a person that formed, without competence, an FSP:
Dear Mr XXXXXXX,
Please be advised that the registration details of XXXXXX LIMITED (FSPXXXXX) have been suppressed from public view on the Financial Service Providers Register (www.fspr.govt.nz) because an incorrect business address was provided to the Registrar of Financial Service Providers in the application for registration. The Registrar’s understanding is that XXXXXX in XXXXXXX provides mail forwarding and virtual office services for a number of companies but it is unclear to us what business the above company does from that address. The Registrar is aware that a number of companies use suite addresses at XXXXXXXXX, as their registered office address and, while that may be legally permissible in some cases for the purposes of the Companies Act 1993, such a serviced office is not in our view (subject to receiving evidence to the contrary) a current or future place of business when given its ordinary meaning – the place where a company usually transacts its affairs or its business. Please advise by return the correct business address for XXXXXXXXXX Limited in New Zealand so that we can arrange for the register to be corrected. If the company does not have a genuine place of business here (we note you live in XXXXXX), then it does not need to be registered in New Zealand for the financial services it provides. Please be aware that the registration details of XXXXXXXX Limited will remain suppressed on the FSPR until this matter is resolved to the Registrar's satisfaction. If resolution is not achieved in the next 30 days, the Registrar will have no choice but to begin the deregistration process under section 18 of the Financial Service Providers (Registration and Dispute Resolution) Act 2008 on the grounds that the company was registered on the FSPR because of a false or misleading representation or omission. We look forward to hearing from you.
Regards
Why I should use Banking Solutions for this service?
Because we are not a software developer or an Introducer. We are duly regulated by the Government to provide companies formation, compliance and financial services.
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