Financial Markets Authority funding

This page explains how the Financial Markets Authority (FMA) is funded, and the includes information about the 2019/20 review and consultation on proposed changes to its funding following a review in 2016.

How the FMA is funded

The Financial Markets Authority (FMA) is funded through a combination of Crown funding and 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).

2019/20 funding and levy review

In 2019, MBIE and the FMA initiated a review of the FMA’s funding requirements and the FMA levy. In addition, MBIE commissioned an independent report to assess different funding options for the FMA and the FMA’s efficiency and effectiveness. The review was commenced in response to cost pressures resulting from the FMA’s evolving regulatory environment and remit. The objectives of the review were to:

  • review the FMA’s funding requirements to ensure it can continue to meet its statutory functions under the financial markets legislation it administers (including the new financial advice regime), and can operate as a credible and effective financial markets regulator
  • consider the level of Crown and third-party levy funding that is appropriate to reflect the FMA’s role in serving the public good
  • ensure that the FMA levy settings remain appropriate and proportionate to the benefit levy payers receive from operating in well-regulated financial markets.

In early 2020, MBIE and the FMA consulted on changes to the FMA’s funding and the FMA levy. Cabinet subsequently agreed to increase the FMA’s funding over three years up to an increase of $24.805 million per annum and that the majority of this increase is to be met through increases in the FMA levy.

In May 2020 changes were confirmed in the Financial Markets Authority (Levies) Regulations 2012(external link) to implement the new levies for the first year of the FMA’s phased increase in funding (2020/21).

Work on the new levies for the second and third year of the phased increase in FMA funding, as well as levy changes needed ahead of the commencement of the new financial advice regime, will continue in 2020.

More information about the funding and levy review is available in the documents below.

2016 review of FMA funding, fees and levies

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.
Last updated: 02 June 2020