Legal and regulatory review for the life and health insurance sector

29 Apr 2021 – The international Financial Action Task Force released its latest Mutual Evaluation Report on New Zealand’s Anti-money Laundering and Counter-terrorist Financing Measures. https://www.fatf-gafi.org/publications/mutualevaluations/documents/mer-new-zealand-2021.html

29 Apr 2021 – The IRD released the corrected Special report on the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021. https://taxpolicy.ird.govt.nz/publications/2021/2021-sr-arferm-act

30 Apr 2021 - Minister of Commerce and Consumer Affairs, Hon David Clark, March 2021 diary released with the following potential financial services sector related meetings noted:

  • 3 Mar 2021 – ASB (Vittoria Short, CE & Gavin Walker, Chair)
  • 3 Mar 2021 – Banking Ombudsman Event (Video conference – various attendees not listed)
  • 8 Mar 2021 – Payments NZ (Steve Wiggins, Chief Executive, Jane Retimana, GM Strategy and Corporate Affairs, Jamie Wood, Manager Clearing Systems, Sarah Hensen, General Counsel and Company Secretary)
  • 9 Mar 2021 - FinCap and NZBA Event (Speaking)
  • 11 Mar 2021 – IAG (Bryce Davies, Executive Manager Corporate Relations)
  • 17 Mar 2021 – Farmers Mutual Group (FMG) (Chris Black, CE, Dave Kibblewhite, Chief Financial, Investment & Risk Officer and Lisa Murray, Head of Compliance, Risk Quality, and General Counsel FMG)
  • 17 Mar 2021 – Financial Services Federation General Meeting (Speaking)
  • 17 Mar 2021 – Suncorp (David Flacks, Chair, Jimmy Higgins, CE, Suncorp NZ; Chris Curtain, CE, AA Insurance; Adrian Tulloch, MD Vero Liability Insurance, Hon Clayton Cosgrove)
  • 18 Mar 2021 – Tower Insurance (Blair Turnbull - CEO)
  • 24 Mar 2021 – ANZ (Sir John Key, Chair, Antonia Watson, CEO)
  • 24 Mar 2021 – BNZ (Doug McKay, Chair, Angela Mentis CE BNZ)
  • 24 Mar 2021 – Ando Insurance (John Lyon, CE Ando Insurance)
  • 24 Mar 2021 – Commission for Financial Capability (Jane Wrightson, Retirement Commissioner)
  • 30 Mar 2021 – Financial Markets Authority (FMA Chair, CE)
  • 30 Mar 2021 – Financial Markets Authority Board (FMA Board)
  • 31 Mar 2021 – Christians Against Poverty (Sam Garaway, CE, Francis Okapaleke, External Engagement Manager)
  • 31 Mar 2021 – Kiwibank (Steve Jurkovich, CE)
  • 31 Mar 2021 – Westpac (CE David McLean; Chair: Jon Dawson)

Weblink to the diary release https://www.beehive.govt.nz/sites/default/files/2021-04/Hon%20Dr%20David%20Clark%20Proactive%20Diary%20Release%20March%202021_0.pdf

28 Apr 2021 – Privacy Commissioner published commentary on its website titled, “That was close! How to respond when you narrowly avoid a serious privacy breach.” https://privacy.org.nz/blog/how-to-respond-privacy-breach/

29 Apr 2021 – RBNZ announced that the RBNZ has joined the Bank of Canada and the Reserve Bank of Australia forming a voluntary network to foster ongoing dialogue and raise awareness of Indigenous economic and financial issues. https://www.rbnz.govt.nz/news/2021/04/te-putea-matua-becomes-inaugural-member-of-new-international-central-bank-network

29 Apr 2021 – Treasury and the Ministry of Housing and Urban Development (HUD) proactively released Cabinet material and advice relating to the Government’s Housing Package announced on 23 March 2021. https://www.treasury.govt.nz/news-and-events/news/housing-package-proactive-release


Legal and regulatory review for the life and health insurance sector

19 Apr 2021 – Dentons Kensington Swan advised that the international Financial Action Task Force (FATF) had consulted private sector stakeholders on an update to FATF guidance on the risk-based approach to virtual assets and virtual asset service providers, with consultation having opened on 19 March 2021 and with submissions closing on 20 April 2021.

https://www.fatf-gafi.org/publications/fatfrecommendations/documents/public-consultation-guidance-vasp.html

20 Apr 2021 – APRA and ASIC released a Life Insurance Claims and Disputes Statistics publication, covering a rolling 12-month period from 1 January 2020 to 31 December 2020. https://www.apra.gov.au/news-and-publications/apra-and-asic-publish-latest-data-on-life-insurance-claims-and-disputes-3

21 Apr 2021 – FMA media release stating that it was warning the funds management industry to avoid advertising large investment returns for the 12-month period to March 31, 2021, as this could mislead investors. https://www.fma.govt.nz/news-and-resources/media-releases/advertising-investment-returns-could-mislead-investors/

21 Apr 2021 – MBIE opened consultation on outstanding aspects of the upcoming regime governing conduct in the financial sector, including consulting on regulations covering matters such as requirements for claims handling and complaints processes, prohibitions of certain types of sales incentives, and the treatment of intermediaries, with submissions closing on 4 June 2021. https://www.mbie.govt.nz/about/news/consultation-opens-on-additional-measures-in-new-financial-conduct-regime/

21 Apr 2021 – Parliamentary website updated for the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill, showing submission closing date as 28 May 2021 and report date as 16 Aug 2021. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_109905/financial-sector-climate-related-disclosures-and-other

21 Apr 2021 – IRD advised that it has identified several errors in the recent special report on the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021, and is currently in the process of updating it. An updated version will be published by early next week. https://taxpolicy.ird.govt.nz/news/2021/2021-04-21-updates-required-special-report


Legal and regulatory review for the life and health insurance sector

9 Apr 2021 - The Commerce Commission has issued its revised cartel leniency and immunity policy and revised template leniency agreement. The cartel leniency and immunity policy has been updated to reflect changes to the Commission’s cartel leniency policy resulting from the introduction of the new Commerce (Criminalisation of Cartels) Amendment Act 2019 which came into effect on 8 April. Cartel conduct can now be punished with a term of imprisonment of up to 7 years. https://comcom.govt.nz/news-and-media/media-releases/2021/commission-issues-updated-cartel-leniency-policy

9 Apr 2021 – Submission closing date on the Incorporated Societies Bill set as 28 May 2021. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_109429/incorporated-societies-bill

9 Apr 2021 – IRD advised that, following attachment of Royal Assent to the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 on 30 March 2021, IRD released a special report on the Act. The report covers:

  • early information on land-related amendments (including the extension to the bright-line test)
  • feasibility expenditure
  • purchase price allocation
  • unclaimed money, and
  • other changes.

Web link at https://taxpolicy.ird.govt.nz/publications/2021/2021-sr-arferm-act


Legal and regulatory review for the life and health insurance sector

29 Mar 2021 – IRD released via an e-mail an AEOI update to the CRS Reportable and Participating Jurisdictions showing additions, with New Caledonia added to Reportable Jurisdictions and Albania, New Caledonia, Nigeria, Peru and Turkey added to Participating Jurisdictions.

29 Mar 2021 – Police Financial Intelligence Unit released the February 2021 Suspicious Activity Report. https://www.police.govt.nz/sites/default/files/publications/fiu-monthly-report-feb2021.pdf

29 Mar 2021 - Protected Disclosures (Protection of Whistleblowers) Bill reported back from Select Committee. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_99238/protected-disclosures-protection-of-whistleblowers-bill

Financial Markets Conduct (US Futures Commission Merchants) Exemption Notice 2021. The exemption notice temporarily extends exemptions currently in place for US registered futures commission merchants that are accredited NZX derivatives participants with the notice expiring on 3 December 2021. https://www.fma.govt.nz/compliance/exemptions/current-exemption-notices/financial-markets-conduct-act-exemptions/financial-markets-conduct-us-futures-commission-merchants-exemption-notice-2021/

24 Mar 2021 – RBNZ announced that it had made a number of amendment orders to revise the requirements for banks’ published disclosure statements. https://www.rbnz.govt.nz/regulation-and-supervision/banks/consultations-and-policy-initiatives/completed-policy-development/public-disclosure-of-bank-breaches

25 Mar 2021 – FMA updated and closed the consultation on the content of regulatory returns for licensed DI, MIS managers and DIMS providers, including a “response to submissions” document and release of regulatory returns data templates. https://www.fma.govt.nz/compliance/consultation/consultation-paper-content-of-regulatory-returns-for-licensed-di-mis-managers-and-dims-providers/

29 Mar 2021 - NZX gave notice of amendments to the NZX Derivatives Market Rules (Rules) pursuant to Rule 1.6. The amendments to the Rules were approved by the Financial Markets Authority on 15 February 2021, following consultation with the market in April 2020. These amendments involve updates to bring the Rules in conformance with the 2019 amendments to the NZX Participant Rules. https://www.nzx.com/announcements/369841

29 Mar 2021 – RBNZ advised that it had submitted a response to the Climate Change Commission’s Climate Action for Aotearoa consultation. https://www.rbnz.govt.nz/news/2021/03/reserve-bank-responds-to-call-for-climate-change-consultation


Legal and regulatory update for the life and health insurance sector

23 Mar 2021 – The IRD advised that the changes to property taxation announced by the Government today will be included in Supplementary Order Paper to the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Bill. https://taxpolicy.ird.govt.nz/news/2021/2021-03-23-government-property-announcements


Legal and regulatory review for the life and health insurance sector

4 Mar 2021 - Overseas Investment Amendment Bill (No 3), introduced on 14 May 2020, reported back to Parliament. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_97807/overseas-investment-amendment-bill-no-3

4 Mar 2021 – APRA released separately the statistics for December 2020 for life insurance and general insurance. Weblinks are https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-december-2020 and https://www.apra.gov.au/news-and-publications/apra-releases-general-insurance-statistics-for-december-2020

4 Mar 2021 – Financial Advisers Disciplinary Committee issued its penalty determination on the case decision released in Jan 2021 regarding Code Standard breaches. The FADC imposed the penalty that the Respondent is censured for the Code breaches together with permanent suppression of identity. https://fadc.govt.nz/decisions/

4 Mar 2021 – Commission for Financial Capability announced that it had launched achievement standard resources through its Sorted in Schools programme. The resources are designed to be taught by teachers as part of day to day classes in Statistics and Economics for students studying toward NCEA Levels 1 and 2. https://cffc.govt.nz/news-and-media/news/money-lessons-offer-ncea-excellence-grades/

5 Mar 2021 – FMA issued a public warning to the adviser for KiwiSaver advice given generally to switch funds in the wake of COVID-19 and market volatility in March 2020. https://www.fma.govt.nz/news-and-resources/media-releases/fma-warns-financial-adviser-kiwisaver-covid19/

5 Mar 2021 – IRD advised that the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Bill, introduced on 4 June 2020, was reported back to Parliament on 4 March 2021. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_98047/taxation-annual-rates-for-2020-21-feasibility-expenditure


Legal and regulatory update for the life and health insurance sector

22 Feb 2021 - KiwiSaver (Life-shortening Congenital Conditions) Amendment Regulations 2021 (‘Regulations’) were released, coming into force on 26 March 2021. This is an important component of planning life risk - especially as KiwiSaver balances rise. It isn't quite the predictable model for early withdrawals we would have liked, but valuable for those it does cover, enabling some access to funds where a person's life expectancy is going to be shortened due to our of the listed conditions.  https://www.legislation.govt.nz/regulation/public/2021/0025/latest/LMS449982.html

1 Mar 2021 - The Minister of Revenue indicated an intention to introduce legislation to relax New Zealand’s loss continuity rules to allow businesses better access to capital via a supplementary order paper to the Taxation (Annual Rates for 2020-21, Feasibility Expenditure, and Remedial Matters) Bill later in March. https://taxpolicy.ird.govt.nz/news/2021/2021-03-01-introduction-new-business-continuity-test-tax-losses

1 Mar 2021 – IRD FATCA email update covered:

  • S. IRS announced voluntary changes to the FATCA schema for reporting of missing US TINs with application to this coming 2021 FATCA reporting period ended 31 March 2021; and
  • A general reminder to New Zealand Financial Institutions ("NZFIs") about the (aggregated) account balance reporting thresholds that apply to whether a person’s financial accounts are reportable. 

2 March 2021 – IRD sought feedback on 10 proposed remedial changes to the foreign trust disclosure rules, which were enacted in the Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017. Submissions close on 23 March 2021. https://taxpolicy.ird.govt.nz/news/2021/2021-03-02-feedback-sought-foreign-trust-remedials

Feb 2021 - Insurance (Prudential Supervision) Act 2010 (IPSA) RBNZ Review – New submission closing date set of 19 March 2021.

1 March 2021 – NZ Police Financial Intelligence Unit released its Dec 2020-Jan 2021 “Suspicious Activity Report.” https://www.police.govt.nz/sites/default/files/publications/fiu-monthly-report-dec2020-jan2021.pdf


Legal and regulatory review for the life and health insurance sector

23 Feb 2021 – IRD released a special report on the new resurgence support payment legislation. https://taxpolicy.ird.govt.nz/news/2021/2021-02-23-special-report-resurgence-support-payment

24 Feb 2021 – Companies Office published the following notice on it FSPR website: https://fsp-register.companiesoffice.govt.nz/

FSPR online services will be unavailable from 5pm Tuesday 2 March 2021 to 8am Monday 15 March 2021 while we update the register to support the new financial advice regime that comes into effect on 15 March 2021.

During this period, you will be able to search the public register, but you won't be able to log in to your online services account to file, update, or access information regarding your financial service provider.

However, FSP’s wishing to give notice of their intention to apply for a transitional licence during this period can still do so. Shortly we will publish forms and information on how to apply during the outage.

23 Feb 2021 – Hone David Clark, Minister of Commerce and Consumer Affairs, diary released for January 2021, containing just 9 items, none identified as directly relevant to financial services. https://www.beehive.govt.nz/sites/default/files/2021-02/Min%20Clark%20Ministerial%20Diary%20January%202021.pdf

23 Feb 2021 – The Department of Internal Affairs advised that it is undertaking a review of sector specific guidelines for accountants, lawyers and conveyancers, and real estate agents, and is offering a survey for completion as a means to provide feedback on the guidelines. https://www.dia.govt.nz/AML-CFT-DNFBPs---Help-us-improve-our-guidance

15 Feb 2021 - The FMA released the Financial Markets Conduct (NZX Derivatives Market Rules) Approval of Rule Change Notice 2021. The notice came into effect from 15 February 2021.


Legal and regulatory update for the life and health insurance sector

2 Dec 2020 – IRD advised that the Minister of Revenue David Parker introduced the Taxation (Income Tax Rate and Other Amendments) Bill into Parliament on 1 Dec 2020. Parliament agreed to accord the Bill urgency. The Bill contains four main measures:

  • introducing a new top personal income tax rate of 39%
  • introducing increased disclosure requirements for trusts
  • increasing the Minimum Family Tax Credit threshold for the 2020–21 tax year, and
  • clarifying more generally that Inland Revenue can request information solely for tax policy development purposes.

All parliamentary stages, including the Third Reading, were completed on 2 Dec 2020. https://taxpolicy.ird.govt.nz/news/2020/2020-12-02-introduction-taxation-income-tax-rate-other-amendments-bill

2 Dec 2020 – Financial Services Council released the third and final part in its Money and You research series - ‘Breaking through the Advice Barrier’ - focused on what is stopping people from getting financial advice, and why it’s important that more New Zealanders have access to it. https://www.fsc.org.nz/bulletin_display/x_blog_code/2121.html

2 Dec 2020 – Good Returns story on an Australian report released by Key Person Risk Management on the potential costs and implications for the life insurance industry of removing commissions and replacing them with a fee for service basis. https://www.goodreturns.co.nz/article/976517905/australian-report-raises-alarm-over-life-insurance-s-future.html

3 Dec 2020 – Department of Internal Affairs issued an AML/CFT update on expiring regulations timeframe and the impact on independent audit obligations. The Ministry of Justice has advised that the timeframes for amending these regulations has changed and the Ministry now aims to have new regulations in force by July 2021. Note the resultant impact on timeframes for reporting entities with an independent audit due prior to July 2021. https://www.dia.govt.nz/AML-CFT-Update-to-expiring-regulations-timeframe


Legal and regulatory update for the life and health insurance sector

23 Nov 2020 – IRD advised of technical changes to the OECD Common Reporting Standard (CRS) for 2021 relating to the Automatic Exchange of Information (AEOI) for Tax Purposes, which may have an impact on reporting New Zealand financial institutions. CRS reporting for the 31 March 2021 year, due to be filed with Inland Revenue by 30 June 2021, will need to comply with the new standard. https://www.ird.govt.nz/international-tax/exchange-of-information/crs/registration-and-reporting/changes-crs-2021