Financial Markets Authority funding
This page explains how the Financial Markets Authority (FMA) is funded and the changes to its funding following a review in 2016.
How the FMA is funded
The Financial Markets Authority (FMA) is funded in part by a levy charged to financial market participants.
The levies are set in the Financial Markets Authority (Levies) Regulations 2012(external link). These regulations were amended in 2017 following a review of the FMA’s funding and levies.
The FMA also charges fees for certain services that it completes for market participants.
These fees are set in the Financial Markets Authority (Fees) Regulations 2011(external link) and the Financial Markets Conduct (Fees) Regulations 2014(external link)
Changes to the FMA’s funding
In October 2016, Cabinet approved a number of changes to the funding of the Financial Markets Authority, the External Reporting Board and the Companies Office as follows:
- additional funding of $9.816 million for the FMA
- changes to the structure of the FMA levy
- return historical over-recovery of the existing FMA and External Reporting Board levies and revise levies payable to incorporate new projected volumes of levy payers
- a number of changes to Companies Office fees.
2016 review of fees and levies
The Ministry of Business, Innovation and Employment and the FMA publicly consulted on these proposed changes throughout July and August 2016.
Read the consultation document: Review of FMA funding levies [PDF, 1.1 MB]
The consultation process asked for feedback following our review of the FMA’s funding and levy, the External Reporting Board levy and the Companies Office fees. The objectives of the reviews were to:
- Review the FMA’s expenditure and funding requirements to ensure that the FMA can adequately carry out its statutory responsibilities and maintain confidence in New Zealand’s financial markets. Since the FMA’s budget was approved in 2011, the overhaul of New Zealand’s securities legislation has increased the scope of the FMA’s regulatory remit and responsibilities.
- Ensure that levy and fee settings remain appropriate:
- for the structure of the FMA levy, align the levy for each stakeholder with the benefits they receive from well-regulated financial markets. Not dis-incentivising the supply of financial products or services was another key goal
- for both the FMA and External Reporting Board levies, key objectives were administrative simplicity, ease of implementation and collection and the avoidance of large over and under-collection
- for the Companies Office fees, ensuring fees for services reflected the cost of providing those services.
- Ensure these regulatory entities are funded sustainably while ensuring third parties meet an appropriate proportion of the cost given the benefits they receive.