After consulting feedback, the Financial Markets Authority (FMA) of New Zealand is introducing a new standard condition for certain market license holders, focusing on business continuity and technical systems, effective from July 1, 2024.

This standard condition applies to the following types of market service licenses:

• Managers of registered schemes (excluding restricted schemes)
• Providers of discretionary investment management services
• Issuers of derivative products
• Prescribed intermediary services (peer-to-peer lending service providers and crowdfunding service providers)

The new standard condition requires license holders to develop and maintain business continuity plans appropriate to their service scale and scope, and ensure that their critical technical systems have business recovery capabilities.

In the event of an incident severely affecting the provision of their services, license holders must promptly notify the Financial Markets Authority, or notify the Authority within 72 hours of determining the incident as significant.

Most market service license holders must inform the FMA of any events significantly affecting the recovery capabilities of their critical technical systems, including events causing serious disruptions or affecting the provision of licensed market services, or events causing significant adverse effects on recipients of these services.

Peter Taylor, Director of Expert Supervision and Response at the Financial Markets Authority, said: "Feedback from the consultation on the new standard conditions indicates support from the market. We have utilized this feedback to refine our approach, aiding in alleviating regulatory burden."