Wholesale Investor Requirements (New Zealand)
In addition to government agencies, the following persons are considered to be a wholesale investor under the Financial Markets Conduct Act:
- A person who is an investment business.
- A person who meets the investment activity criteria.
- A person who is large.
- A person who is an eligible investor.
- A person who invests at least NZ$750,000 in the offer.
Further detail on the above categories is set out below.
A person who is an investment business:
In addition to banks, non-bank deposit takers, licensed insurers, licensed managers, derivatives issuers and financial advisers, this category encompasses entities whose principal business consists of any of the following:
- Investing in financial products;
- Acting as an underwriter;
- Providing a financial advice, client money or property service; or
- Trading in financial products on behalf of other persons.
A person who meets the investment activity criteria:
- They (or the entities they control) own (or during the previous 2 year period have owned) a portfolio of financial products of a total value of at least $1 million;
- They (or the entities they control) have (or during the previous 2 year period have) carried out transactions to acquire financial products where the total amount payable was at least $1 million; or
- They, within the last 10 years, have been employed or engaged in an investment business and have, for at least 2 years during that 10 year period, participated to a material extent in the investment decisions made by the investment business.
In counting financial products towards the $1 million threshold, bank deposits, bonus bonds, building society investments (and other similar investments) as well as interests in a retirement scheme (e.g. KiwiSaver or other superannuation scheme) cannot be counted. Any products offered by the investor’s associated persons are also excluded.
A person who is large:
As at the last day of the 2 most recently completed financial years, they and their controlled entities had net assets exceeding $5 million; or
- In the 2 most recently completed financial years, they and their controlled entities had consolidated turnover which exceeded $5 million.
A person who is an eligible investor:
Eligible investors are investors who self-certify that:
- They have previous experience to assess the merits of the transaction, their information needs and the adequacy of the information provided; and
- They understand the consequences of certifying themselves to be an eligible investor,
Their certificate must set out the grounds for the above certification.
In addition, a financial adviser, qualified statutory accountant or lawyer must sign a written confirmation of the above certification. That person must not sign the certificate, unless having considered the investor’s grounds for their certificate:
- They are satisfied the investor has been sufficiently advised of the consequences of the certification; and
- Have no reason to believe that the certification is incorrect or that further information or investigation is required.
A person who invests at least NZ$750,000 in the offer.