NEW ZEALAND Law and Practice Contributed by: David Weavers, Alex MacDuff, Matt Consedine and Verniel Virtucio, Russell McVeagh
There are limited reporting and compliance requirements under the FSPA, but, again, these are not considered to be onerous. Local funds will likely be subject to the AMLA, which includes requirements in relation to customer due diligence, suspicious activities reports, record keeping and maintenance of an AML programme and compliance officer. Other than the general provisions above, there are no statutory compliance and reporting requirements that apply specifically to private credit providers. Other requirements would arise if funds are being raised from retail investors. Foreign Private Credit Lenders If a foreign private credit lender is required to be registered as an overseas company under the Companies Act or registered under the FSPA (see 2.1 Licensing and Regulatory Approval ) then it will be subject to limited notification, com - pliance and financial reporting requirements. The AMLA may also apply. The AMLA does not specify a territorial scope. However, guidance from the relevant regulators states that: • an overseas financial institution carrying on business in New Zealand (including if required to be registered under the Companies Act) will be a reporting entity under the AMLA and subject to the general requirements noted above; and • a financial institution that is not registered or required to be registered under the Compa - nies Act is unlikely to be a reporting entity under the AMLA. 2.5 Club Lending and Antitrust There are no general restrictions on club lend - ing by private credit providers in New Zealand.
Although the Commerce Commission (New Zealand’s antitrust regulator) has recently taken interest in the broader banking and finance sec - tor, it does not appear to be specifically focused on club lending arrangements. That said, there are certain provisions of the Commerce Act 1986 (Commerce Act) that will be relevant to how club lending arrangements are initiated and structured. In particular, the Commerce Act prohibits con - tracts, arrangements and understandings that either: • contain a “cartel provision”, being a provision that has the purpose, effect or likely effect of fixing prices, restricting output or allocat - ing markets for goods and services that two or more parties to the agreement supply or acquire in competition with each other; and/or • have the purpose, effect or likely effect of substantially lessening competition in a mar - ket in New Zealand. The threshold for finding an “understanding” is low, and includes any informal conversations or information exchanges that give rise to an expectation (on the part of the other parties to the understanding) that a particular party will act or refrain from acting in a particular manner. Nonetheless, the Commerce Act recognises that competitors may have legitimate reasons to collaborate, and, in such cases, the inclusion of a cartel provision in that collaboration may be appropriate. Accordingly, the Commerce Act provides an exception for cartel provisions that are reasonably necessary for the purpose of a “collaborative activity”, being an enterprise, ven - ture or other activity in trade that is carried on in co-operation by two or more parties, provided
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