Pursuant to section 38 of the Securities Markets Act 1988, the Securities Commission gives the following notice.
N o t i c e
Clause 1: Title, commencement, and expiry—(1) This notice is the Authorised Futures Dealers (JPMorgan Chase Bank, N.A., and J.P. Morgan Australia Limited) Notice 2008.
(2) This notice comes into force on the day after the date of its publication in the New Zealand Gazette.
(3) This notice expires on the close of 31 October 2013.
Clause 2: Interpretation—(1) In this notice, unless the context otherwise requires:
“Act” means the Securities Markets Act 1988.
“AFS License” means an Australian Financial Services License granted under the Corporations Act.
“ASIC” means the Australian Securities and Investments Commission.
“Corporations Act” means the Corporations Act 2001 of the Commonwealth of Australia.
“JPMAL” means J.P. Morgan Australia Limited.
“JPMCB” means JPMorgan Chase Bank, National Association.
“recognised exchange” means an authorised futures exchange or any exchange in a country other than
New Zealand which is authorised by the laws of that country to operate as a futures exchange.
“specified futures contracts” means a futures contract which is a foreign currency futures contract to which JPMCB is or intends to be a party.
“wholesale client” means any client that is:
(a) a person who controls at least $10 million; or
(b) a trustee of a trust or a funds manager, acting in that capacity, who has under that person’s control, as trustee or funds manager, net assets of at least $10 million; or
(c) a person who is authorised to carry on the business of dealing in futures contracts under
the Act; or
(d) a person authorised in another jurisdiction by the competent authority of that jurisdiction to deal in futures contracts; or
(e) Her Majesty the Queen in right of New Zealand, a Crown entity named in the Crown Entities Act 2004, or a State enterprise named in the First or Second Schedule to the State-Owned Enterprises Act 1986 (each as amended from time to time); or
(f) a person who is a statutory corporation or a registered bank; or
(g) a person whose principal business is the investment of money or who, in the course of and for the purposes of their business, habitually invests money; or
(h) a person who is a related body corporate of any of the persons mentioned in subparagraphs (a) to (g) above.
(2) Any term or expression that is defined in the Act and used, but not defined, in this notice has the same meaning as in the Act.
Clause 3: Authorisation for JPMAL—(1) JPMAL is authorised to carry on the business of dealing in futures contracts generally.
(2) The authorisation in clause 3(1) is subject to the conditions that:
(a) in respect of any futures contract to which the authorisation applies that is not a futures contract that is effected on a recognised exchange, JPMCB is a party to the futures contract; and
(b) JPMAL deals only on behalf of its wholesale clients; and
(c) before dealing in any futures contract in respect of which the authorisation applies, JPMAL is satisfied on reasonable grounds that the wholesale client is contracting:
(i) as principal on its own account; or
(ii) on behalf of a related body corporate; or
(iii) as trustee of a trust or manager of a managed fund; and
(d) in respect of any futures contract that is not made on or effected through a recognised exchange, the terms of the futures contract:
(i) create obligations that cannot be transferred or terminated by either party to the futures contract without the consent of the other party; and
(ii) require that any transfer of obligations under the futures contract can be made only to a person who meets the criteria described in paragraphs (b) and (c) above; and
(e) in respect of any futures contract that is made on or effected through a recognised exchange, any acquisition or disposal of the contract is effected through a person who is an authorised participant or member of the recognised exchange and who is authorised or licensed by the laws of the country in which it operates to deal in futures contracts on behalf of that person and to hold client money for that purpose; and
(f) JPMAL does not hold client money or client property in connection with dealing in futures contracts; and
(g) JPMAL is licensed as an Australian Financial Services Licensee under the Corporations Act and holds an AFS License which authorises JPMAL to provide futures advisory services to wholesale clients; and
(h) JPMAL notifies the Commission if JPMAL’s AFS Licence is varied or revoked and notifies the Commission of any regulatory action taken by ASIC in relation to JPMAL’s AFS Licence; and
(i) JPMAL provides the Commission with a copy
of JPMAL’s annual financial statements no later than 3 months after the end of each financial year
for JPMAL; and
(j) JPMAL notifies the Commission of any material matter concerning JPMAL’s authorisation as a futures dealer.
Clause 4: Authorisation for JPMCB—(1) JPMCB is authorised to carry on the business of dealing in specified futures contracts.
(2) The authorisation in clause 4(1) is subject to the conditions that:
(a) JPMCB deals only on behalf of its wholesale clients; and
(b) before dealing in any futures contract in respect of which the authorisation applies, JPMCB is satisfied on reasonable grounds that the wholesale client is contracting:
(i) as principal on its own account; or
(ii) on behalf of a related body corporate; or
(iii) as trustee of a trust or manager of a managed fund; and
(c) the terms of any specified futures contract:
(i) create obligations that cannot be transferred or terminated by either party to the futures contract without the consent of the other party; and
(ii) require that any transfer of obligations under the futures contract can be made only to a person who meets the criteria described in paragraphs (a) and (b) above; and
(d) JPMCB is licensed as an Australian Financial Services Licensee under the Corporations Act and holds an AFS License which authorises JPMCB to provide futures advisory services to wholesale clients; and
(e) all client money and property held by JPMCB in connection with dealing in futures contracts is held
in accordance with the client money and property protection provisions of the Corporations Act and the conditions of JPMCB’s AFS License; and
(f) JPMCB notifies the Commission if JPMCB’s AFS Licence is varied or revoked and notifies the Commission of any regulatory action taken by ASIC in relation to JPMCB’s AFS Licence; and
(g) JPMCB provides the Commission with a copy
of JPMCB’s annual financial statements no later than 3 months after the end of each financial year
for JPMCB; and
(h) JPMCB notifies the Commission of any material matter concerning JPMCB’s authorisation as a futures dealer.
Clause 5: Revocation—The Authorised Futures Dealers Notice 2007, published in the New Zealand Gazette,
8 February 2007, No. 14, page 266, is revoked.
Dated at Wellington this 22nd day of October 2008.
The Common Seal of the Securities Commission was affixed in the presence of:
[L.S.]
JANE DIPLOCK, Chairman.